EDGAR 10-K Filing

Company CIK: 712770
Filing Year: 2025
Filename: 712770_10-K_2025_0001558370-25-002406.json

---

ITEM 1. BUSINESS
Item 1. Business.
General
We are a self-administered and self-managed real estate investment trust, also known as a REIT. We acquire, own and manage a geographically diversified portfolio consisting of industrial and, to a lesser extent, retail properties, many of which are subject to long-term leases. Most of our leases are “net leases” under which the tenant, directly or indirectly, is responsible for paying the real estate taxes, insurance and ordinary maintenance and repairs of the property. As of December 31, 2024, we own 100 properties and participate in joint ventures that own two properties. These 102 properties are located in 31 states and have an aggregate of approximately 10.9 million square feet (including an aggregate of approximately 46,000 ­square feet at properties owned by our joint ventures).
As of December 31, 2024:
● our 2025 contractual rental income (as described in “- Our Tenants”) is $72.0 million;
● the occupancy rate of our properties is 99.2% based on square footage;
● the weighted average remaining term of our mortgage debt is 6.1 years and the weighted average interest rate thereon is 4.56%; and
● the weighted average remaining term of the leases generating our 2025 contractual rental income is five years.
We maintain a website at www.1liberty.com. The reports and other documents that we electronically file with, or furnish to, the SEC pursuant to Section 13 or 15(d) of the Exchange Act can be accessed through this site, free of charge, as soon as reasonably practicable after we electronically file or furnish such reports. These filings are also available on the SEC’s website at www.sec.gov. The information on our website is not part of this report.
2024 and Recent Developments
In 2024:
● we acquired three industrial properties for an aggregate purchase price of $44.7 million. These properties account for $3.0 million, or 4.1%, of our 2025 contractual rental income.
● we sold 11 properties (i.e., six retail, two industrial, two health and fitness, and one restaurant) and one parcel at a multi-tenant retail property, for an aggregate net sales proceeds of $38.2 million and an aggregate net gain on sale of real estate of $18.0 million. The properties sold accounted for $2.7 million, or 3.0%, and $5.1 million, or 5.6%, of 2024 and 2023 rental income, net, respectively.
● as of December 31, 2024 and February 28, 2025, no amounts were outstanding on our $100.0 million credit facility.
Subsequent to December 31, 2024, we:
Purchases
● acquired, on January 16, 2025, two Class A industrial properties located in Theodore, Alabama, (the “Alabama Purchase”), for $49.0 million, including a $29.0 million mortgage maturing in 2035 and bearing an interest rate of 6.12% (interest only for five years and then amortizing on a 30-year schedule). The two properties comprise an aggregate of 371,586 square feet, are located on approximately 31 acres and are leased to a total of four tenants with a weighted average remaining lease term of approximately seven years. We estimate that in 2025, these properties will generate an
aggregate of approximately $3.0 million of contractual rental income and $1.7 million of interest expense.
● acquired, on February 6, 2025, a Class A industrial property located in Wichita, Kansas (the “Kansas Purchase”), for $13.3 million, including a $7.5 million mortgage maturing in 2030 and bearing an interest rate of 6.09% (interest only through maturity). The property comprises 138,000 square feet, is located on approximately 9.5 acres, is leased to one tenant and the lease expires in 2028. We estimate that in 2025, this property will generate approximately $800,000 of contractual rental income and $413,000 of interest expense.
● signed a contract, on February 6, 2025, to acquire a Class A industrial property located in Council Bluffs, Iowa (the “Council Bluffs II Purchase”; and together with the Alabama Purchase and the Kansas Purchase, the “New Properties”), for $26.0 million, including a $15.6 million mortgage maturing in 2035 and bearing an interest rate of 6.42% (interest only for five years and then amortizing on a 30-year schedule). The property comprises 236,324 square feet, is located on approximately 23.5 acres and is adjacent to a 302,347 square foot industrial property we acquired in 2024. The property is leased to two tenants and the weighted average remaining lease term is approximately six years. We estimate that the purchase will be completed in the first quarter of 2025 and that this property will generate, in 2025, approximately $1.5 million of contractual rental income and $800,000 of interest expense.
We estimate that after giving effect to the purchase of New Properties, 2025 contractual rental income will be approximately $77.3 million.
Sale
● sold, on January 21, 2025, a restaurant property located in Concord, North Carolina (the “Concord Sale”) for $3.3 million and generated net proceeds of $3.1 million. This property accounted for $211,000 and $209,000 of rental income, net, $54,000 and $51,000 of depreciation and amortization expense, and $36,000 and $56,000 of mortgage interest expense for 2024 and 2023, respectively. We anticipate that we will recognize, during the quarter ending March 31, 2025, a gain of approximately $1.1 million from the sale of this property.
In January 2025, we terminated the previously announced contract to sell a multi-tenant retail center located in St. Louis Park, Minnesota.
Our Business Objective
Our business objective is to increase stockholder value by:
● identifying opportunistic and strategic property acquisitions consistent with our portfolio and our acquisition strategies;
● monitoring and maintaining our portfolio, and as appropriate, working with tenants to facilitate the continuation or expansion of their tenancies;
● managing our portfolio effectively, including opportunistic and strategic property sales;
● obtaining mortgage indebtedness (including refinancings) on favorable terms, ensuring that the cash flow generated by a property exceeds the debt service thereon and maintaining access to capital to finance property acquisitions; and
● maintaining and, over time, increasing our dividend.
Acquisition Strategies
We seek to acquire properties throughout the U.S. that have locations, demographics and other investment attributes that we believe to be attractive. We believe that long-term leases provide a predictable income stream over the term of the lease, making fluctuations in market rental rates and in real estate values less significant to achieving our overall investment objectives. Our primary objective is to acquire single-tenant properties, and in particular, industrial properties, that are subject to long-term net leases that include periodic contractual rental increases or rent increases based on increases in the consumer price index. Periodic contractual rental increases provide reliable increases in future rent payments and rent increases based on the consumer price index provide protection against inflation. Historically, long-term leases have made it easier for us to obtain longer-term, fixed-rate mortgage financing with principal amortization, thereby moderating the interest rate risk associated with financing or refinancing our property portfolio and reducing the outstanding principal balance over time. We have, however, acquired properties, and may continue to acquire properties, that are subject to short-term leases when we believe that such properties represent a favorable opportunity for generating additional income from its re-lease or has significant residual value.
Generally, we hold the properties we acquire for an extended period of time. Our investment criteria are intended to identify properties from which increased asset value and overall return can be realized from an extended period of ownership. Although our investment criteria favor an extended period of ownership, we will dispose of a property if we regard the disposition of the property as an opportunity to realize the overall value of the property sooner or to avoid future risks by achieving a determinable return from the property.
We identify properties through the network of contacts of our senior management, which contacts include real estate brokers, private equity firms, banks and law firms. In addition, we attend industry conferences and engage in direct solicitations.
Our charter documents do not limit the number of properties in which we may invest, the amount or percentage of our assets that may be invested in any specific property or property type, or the concentration of investments in any region in the U.S. We do not intend to acquire properties located outside of the U.S. We will continue to form entities to acquire interests in real properties, either alone or with other investors, and we may acquire interests in joint ventures or other entities that own real property.
It is our policy, and the policy of our affiliated entities, that any investment opportunity presented to us or to any of our affiliated entities that involves the acquisition of a net leased property, a ground lease (other than a ground lease of a multi-family property) or a community shopping center, will first be offered to us and may not be pursued by any of our affiliated entities unless we decline the opportunity. Further, to the extent our affiliates are unable or unwilling to pursue an acquisition of a multi-family property (including a ground lease of a multi-family property), we may pursue such transaction if it meets our investment objectives.
Investment Evaluation
In evaluating potential investments, we consider, among other criteria, the following:
● the current and projected cash flow of the property;
● the estimated return on equity to us;
● an evaluation of the property and improvements, given its location and use;
● an evaluation of the credit quality of the tenant;
● alternate uses or tenants for the property;
● local demographics (population and rental trends);
● the purpose for which the property is used (i.e., industrial, retail or other);
● the terms of tenant leases, including co-tenancy provisions and the relationship between current rents and market rents;
● the potential to finance and/or refinance the property;
● the projected residual value of the property;
● the ability of a tenant, if a net leased property, or major tenants, if a multi-tenant property, to meet operational needs and lease obligations;
● potential for income and capital appreciation;
● occupancy of and demand for similar properties in the market area; and
● the ability of a tenant and the related property to withstand changing economic conditions and other challenges.
Our Tenants
The following table sets forth information about our tenants by industry sector as of December 31, 2024:
Percentage of
Number of
Number of
2025 Contractual
2025 Contractual
Type of Property
Tenants
Properties
Rental Income (1)
Rental Income
Industrial
$
52,103,000
72.4
Retail-General
10,254,000
14.2
Retail-Furniture
3,449,000
4.8
Other (2)
1,992,000
2.8
Retail-Office Supply (3)
1,505,000
2.1
Theater
1,177,000
1.6
Health & Fitness
1,026,000
1.4
Restaurant
520,000
0.7
$
72,026,000
100.0
(1) Our 2025 contractual rental income represents, after giving effect to any abatements, concessions, deferrals or adjustments, the base rent payable to us in 2025 through the stated expiration of such leases, under leases in effect at December 31, 2024. Our 2025 contractual rental income:
● Includes $686,000 from Burlington Coat Factory, a tenant at our multi-tenant retail property in St. Louis Park, Minnesota, which, subsequent to December 31, 2024, terminated their lease effective as of July 31, 2025. After giving effect to such termination, this tenant will contribute approximately $400,000 to 2025 contractual rental income.
● Excludes an aggregate of $5.9 million comprised of: (i) an aggregate of $5.3 million attributable to the New Properties, (ii) $233,000 representing our share of the base rent payable to our joint ventures, (iii) $220,000 from the Concord Sale, and (iv) $188,000 from a tenant, Party City, at our Lake Charles, Louisiana property which filed for bankruptcy protection in December 2024.
(2) Includes an office property located in Brooklyn, New York, leased to one tenant and that accounts for $1.3 million, or 1.9%, of 2025 contractual rental income.
(3) Includes five properties which are net leased to Office Depot pursuant to five separate leases. Four of the Office Depot leases contain cross-default provisions.
Our Leases
Most of our leases are net leases under which the tenant, in addition to its rental obligation, typically is responsible, directly or indirectly, for expenses attributable to the operation of the property, such as real estate taxes and assessments, insurance and ordinary maintenance and repairs. The tenant is also generally responsible for maintaining the property and for restoration following a casualty or partial condemnation. The tenant is typically obligated to indemnify us for claims arising from the property and is responsible for maintaining insurance coverage for the property it leases and naming us an additional insured. Under some net leases, we are responsible for structural repairs, including foundation and slab, roof repair or replacement and restoration following a casualty event, and at several properties we are responsible for certain expenses related to the operation and maintenance of the property.
Leases representing 71.9% of our 2025 contractual rental income provide for either periodic contractual rent increases or a rent increase based on the consumer price index. Some leases provide for minimum rents supplemented by additional payments based on sales derived from the property subject to the lease (i.e., percentage rent). Percentage rent contributed $117,000, $107,000 and $85,000 of rental income, net, in 2024, 2023 and 2022, respectively.
Generally, our strategy is to acquire properties that are subject to existing long-term leases or to enter into long-term leases with our tenants. Our leases generally provide the tenant with one or more renewal options. The weighted average remaining term of our leases was 5.0 years, 5.5 years and 5.9 years at December 31, 2024, 2023 and 2022, respectively.
The following table sets forth scheduled expirations of leases at our properties as of December 31, 2024:
Percentage of
Approximate
2025 Contractual
Number of
Square Footage
2025 Contractual
Rental Income
Expiring
Subject to
Rental Income Under
Represented by
Year of Lease Expiration (1)
Leases
Expiring Leases (2)
Expiring Leases
Expiring Leases
360,260
$
1,518,000
2.1
1,050,078
6,205,000
8.6
2,127,122
14,253,000
19.8
1,679,934
11,637,000
16.2
1,624,682
9,311,000
12.9
743,527
7,647,000
10.6
1,080,408
5,909,000
8.2
407,013
3,352,000
4.7
853,179
7,644,000
10.6
225,884
2,395,000
3.3
2035 and thereafter
634,629
2,155,000
3.0
10,786,716
$
72,026,000
100.0
(1) Lease expirations do not give effect to the exercise of existing renewal options.
(2) Excludes an aggregate of 83,569 square feet of vacant space.
Financing, Re-Renting and Disposition of Our Properties
Our credit facility provides us with a source of funds that is used to acquire properties, payoff existing mortgages, and to a more limited extent, invest in joint ventures, improve properties and for working capital purposes. Generally, net proceeds received from the sale, financing or refinancing of properties are required to be used to repay amounts outstanding under our facility. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Liquidity and Capital Resources-Credit Facility”.
We mortgage specific properties on a non-recourse basis, subject to standard carve-outs to enhance the return on our investment in a specific property. Generally, the proceeds of mortgage loans are first applied to reduce indebtedness on our credit facility and the balance may be used for other general purposes, including property acquisitions, investments in joint ventures or other entities that own real property, and working capital.
With respect to properties we acquire on a free and clear basis, we usually seek to obtain long-term fixed-rate mortgage financing, when available at acceptable terms, shortly after the acquisition of such property to avoid the risk of fluctuating (i) interest rates and (ii) supply and demand in the credit and mortgage markets. We also will acquire a property that is subject to (and will assume) a fixed-rate mortgage. Many of our mortgages provide for amortization of part of the principal balance during the term, thereby reducing the refinancing risk at maturity. Some properties are financed on a cross-defaulted or cross-collateralized basis, and we may collateralize a single financing with more than one property.
Prior to the termination or expiration of leases relating to our properties, we explore re-renting or selling such property to maximize our return, considering, among other factors, the income potential and market value of such property. We acquire properties for long-term investment for income purposes and do not typically engage in the turnover of investments. We will consider the sale of a property if a sale appears advantageous in view of our investment objectives. If there is a substantial tax gain, we may seek to enter into a tax deferred transaction and reinvest the proceeds in another property. Cash realized from the sale of properties, net of required payoffs of the related mortgage debt, if any, required paydowns of our credit facility, and distributions to stockholders, is available for general working capital purposes and the acquisition of additional properties.
In 2024, we sold 11 properties (i.e., six retail, two industrial, two health and fitness, and one restaurant) and one parcel at a multi-tenant retail property. Generally, we sold these properties due to one or more of the following considerations: our belief that such property had achieved its maximum potential value; our concern with respect to the long-term prospects for the tenant or the geographic sub-market; or our concern in our ability, on acceptable terms, to refinance the property’s mortgage debt or re-lease the property. We used a significant portion of the net proceeds from these sales for working capital purposes (including dividend payments) and the acquisition of additional properties in 2024 and early 2025.
Competition
The U.S. commercial real estate investment market, and in particular, the market for industrial properties, is highly competitive. We compete with many entities engaged in the acquisition, leasing and operation of commercial properties. As such, we compete with other investors to acquire, and obtain financing for, a limited supply of properties. Competitors include traded and non-traded public REITs, private equity firms, institutional investment funds, insurance companies and private individuals, many of which have greater financial and other resources than we have, and the ability or willingness to accept more risk than we believe appropriate for us. We can provide no assurance that we will be able to compete successfully in the commercial real estate industry.
Regulation
Environmental
Investments in real property create the potential for environmental liability on the part of the owner or operator of such real property. If hazardous substances are discovered on or emanating from a property, the owner or operator of the property may be held strictly liable for all costs and liabilities relating to such hazardous substances. We generally obtain a Phase I environmental study (which involves inspection without soil sampling
or ground water analysis) conducted by independent environmental consultants prior to acquiring a property and, in certain instances, have conducted additional investigations.
We do not believe that there are hazardous substances existing on our properties that would have a material adverse effect on our business, financial position or results of operations. We do not carry insurance coverage for the types of environmental risks described above.
We believe that we are in compliance, in all material respects, with all federal, state and local ordinances and regulations regarding hazardous or toxic substances. Furthermore, we have not been notified by any governmental authority of any noncompliance, liability or other claim in connection with any of our properties, that we believe would have a material adverse effect on our business, financial position or results of operations.
Americans with Disabilities Act of 1990
Our properties are required to comply with the Americans with Disabilities Act of 1990 and similar state and local laws and regulations (collectively, the “ADA”). The primary responsibility for complying with the ADA, (i.e., either us or our tenant) generally depends on the applicable lease, but we may incur costs if the tenant is responsible and does not comply. As of December 31, 2024, we have not been notified by any governmental authority, nor are we otherwise aware, of any non-compliance with the ADA that we believe would have a material adverse effect on our business, financial position or results of operations.
Other Regulations
State and local governmental authorities regulate the use of our properties. While many of our leases mandate that the tenant is primarily responsible for complying with such regulations, the tenant’s failure to comply could result in the imposition of fines or awards of damages on us, as the property owner, or restrictions on the ability to conduct business on such properties.
Human Capital Resources
As of December 31, 2024, we had ten full-time employees (including five full-time executive officers), who devote substantially all of their business time to our activities. In addition, certain (i) executive, administrative, legal, accounting, clerical, property management, property acquisition, consulting (i.e., sale, leasing, brokerage, and mortgage financing), and construction supervisory services, which we refer to collectively as the “Services”, and (ii) facilities and other resources, are provided pursuant to a compensation and services agreement between us and Majestic Property.
In 2024, pursuant to the compensation and services agreement, we paid Majestic Property approximately $3.3 million for the Services plus $336,000 for our share of all direct office expenses, including rent, telephone, postage, computer services, internet usage and supplies. Included in the $3.3 million is $1.4 million for property management services-the amount for the property management services is based on 1.5% and 2.0% of the rental payments (including tenant reimbursements) actually received by us from net lease tenants and operating lease tenants, respectively. We do not pay Majestic Property for property management services with respect to properties managed by third parties. Based on our portfolio of properties at December 31, 2024, we estimate that the property management fee in 2025 will be approximately $1.4 million.
We provide a competitive benefits program to help meet the needs of our employees. In addition to salaries, the program includes annual cash bonuses, stock awards, contributions to a pension plan, healthcare and insurance benefits, health savings accounts, paid time off and family leave. Employees are offered great flexibility to meet personal and family needs and regular opportunities to participate in professional development programs. Most of our employees have a long tenure with us, which we believe is indicative of our employees’ satisfaction with the work environment we provide.
We maintain a work environment that is free from discrimination or harassment on the basis of color, race, sex, national origin, ethnicity, religion, age, disability, sexual orientation, gender identification or expression or any other status protected by applicable law, and our employees are compensated without regard to any of the foregoing.
Information about our Executive Officers
Set forth below is a list of our executive officers whose terms expire at our 2025 annual board of directors’ meeting. The business history of our executive officers, who are also directors, will be provided in our proxy statement to be filed with the SEC not later than April 30, 2025:
NAME
AGE
POSITION WITH THE COMPANY
Matthew J. Gould*
Chairman of the Board
Fredric H. Gould*
Vice Chairman of the Board
Patrick J. Callan, Jr.
President, Chief Executive Officer and Director
Lawrence G. Ricketts, Jr.
Executive Vice President and Chief Operating Officer
Jeffrey A. Gould*
Senior Vice President and Director
Isaac Kalish**
Senior Vice President and Chief Financial Officer
David W. Kalish**
Senior Vice President-Financial
Mark H. Lundy
Senior Vice President
Israel Rosenzweig
Senior Vice President
Richard M. Figueroa
Senior Vice President
Justin Clair
Executive Vice President
Mili Mathew
Vice President-Financial and Chief Accounting Officer
Alysa Block
Treasurer
*
Matthew J. Gould and Jeffrey A. Gould are Fredric H. Gould’s sons.
**
Isaac Kalish is David W. Kalish’s son.
Lawrence G. Ricketts, Jr. Mr. Ricketts has been our Chief Operating Officer since 2008, Executive Vice President since 2006 and served as Vice President from 1999 through 2006.
Isaac Kalish. Mr. Kalish has served as our Chief Financial Officer since 2023 as Senior Vice President since 2022 and as Vice President from 2013 through 2022. He has served as Treasurer of the managing general partner of Gould Investors since 2013 and as its Assistant Treasurer from 2012, as Senior Vice President since 2023, as Vice President and Treasurer of BRT Apartments Corp. since 2013 and 2014, respectively, and as its Assistant Treasurer from 2009 through 2013. He is a certified public accountant.
David W. Kalish. Mr. Kalish has served since 2023 as our Senior Vice President-Financial, and from 1990 to 2023, as Chief Financial Officer and Senior Vice President. Since 1998, he has served as Senior Vice President, Finance and from 1990 to 1998, as Chief Financial Officer of BRT Apartments. Since 1990, he has served as Senior Vice President and Chief Financial Officer of the managing general partner of Gould Investors. Mr. Kalish is a certified public accountant.
Mark H. Lundy. Mr. Lundy has served as our Senior Vice President since 2006 and as Vice President from 2000 through 2006. He has served as Senior Vice President of BRT Apartments since 2006, and as its Vice President from 1993 to 2006. Mr. Lundy has served as President and Chief Operating Officer of the managing general partner of Gould Investors since 2013 and as its Vice President from 1990 through 2012. He is an attorney admitted to practice in New York and the District of Columbia.
Israel Rosenzweig. Mr. Rosenzweig has served as our Senior Vice President since 1997. He has served as Chairman of the Board of Directors of BRT Apartments since 2013, as Vice Chairman of its Board of Directors from 2012 through 2013, and as its Senior Vice President from 1998 through 2012. Since 1997, he has served as a Vice President of the managing general partner of Gould Investors.
Richard M. Figueroa. Mr. Figueroa has served as our Senior Vice President since 2019, as Vice President from 2001 through 2019, as Vice President of BRT Apartments from 2002 through 2019 and as Vice President of the managing general partner of Gould Investors since 1999. Mr. Figueroa is an attorney admitted to practice in New York.
Justin Clair. Mr. Clair has served as Executive Vice President since 2023, as Senior Vice President-Acquisitions from 2019 through 2023, as Vice President from 2014 through 2019, as Assistant Vice President from 2010 through 2014, and has been employed by us since 2006.
Mili Mathew. Ms. Mathew has served as Chief Accounting Officer since 2023, Vice President-Financial, since 2022, as Assistant Vice President-Financial, from 2020 through 2022, and has been employed by us since 2014. Ms. Mathew is a certified public accountant.
Alysa Block. Ms. Block has been our Treasurer since 2007 and served as Assistant Treasurer from 1997 to 2007. Ms. Block also served as the Treasurer of BRT Apartments from 2008 through 2013, and as its Assistant Treasurer from 1997 to 2008.

---

ITEM 1A. RISK FACTORS
Item 1A. Risk Factors.
Set forth below is a discussion of certain risks affecting our business. The categorization of risks set forth below is meant to help you better understand the risks facing our business and is not intended to limit your consideration of the possible effects of these risks to the listed categories. Any impacts from the realization of any of the risks discussed, including our financial condition and results of operations, may, and likely will, adversely affect many aspects of our business. In addition to the other information contained or incorporated by reference in this Form 10-K, readers should carefully consider the following risk factors:
Risks Related to Our Business
If we are unable to re-rent properties upon the expiration of our leases or if our tenants default or seek bankruptcy protection, our revenues and operating cash flows will be reduced and we would incur additional costs.
Substantially all of our revenue and operating cash flow is derived from rent paid by our tenants pursuant to leases. From 2025 through 2030, the following leases expire:
Percentage of
Number of
2025 Contractual
2025 Contractual
Leases Expiring December 31,
Leases
Rental Income
Rental Income
2025 - 2027 (1)
$
21,976,000
30.5
2028 - 2030
28,595,000
39.7
(1)Eight leases accounting for 2.1% of contractual rental income expire in 2025, and we believe or have been advised that tenants with respect to $560,000 of 2025 contractual rental income intend to allow their leases to expire.
If our tenants, and in particular, our significant tenants, (i) do not renew their leases upon lease expiration, (ii) default on their obligations or (iii) seek rent relief, lease renegotiation or other accommodations, our revenues would decline and, in certain cases, co-tenancy provisions (i.e., a tenant’s right to reduce their rent or terminate their lease if certain key tenants vacate a property) may be triggered possibly allowing other tenants at the same property to reduce their rental payments or terminate their leases. At the same time, we would remain responsible for the payment of the mortgage obligations with respect to the related properties, would become responsible for the operating expenses (e.g., real estate taxes, maintenance and insurance) related to these properties, and, in the event of tenant defaults, would incur expenses in enforcing our rights as landlord. Our efforts to find replacement tenants may be challenged as there are a limited number of tenants interested in certain types of properties, such as our theaters (i.e., Regal Cinemas) and a health and fitness center (i.e., LA Fitness) which account in the aggregate for $2.2 million, or 3.0%, of 2025 contractual rental income and the cost of reconfiguring such properties to make them more attractive to a broader set of potential tenants may be prohibitive. Finding replacement tenants for retail properties or incentivizing retail tenants to renew their leases is challenging as retail tenants often require that we pay for improvements to their facility (i.e., tenant improvements) - these improvements are often very costly and makes the prospect of entering into such lease less attractive to us. Even if we find replacement tenants or renegotiate leases with current tenants, the terms of
the new or renegotiated leases, after giving effect to tenant concessions or the cost of required renovations/ reconfigurations may be less favorable than current lease terms and could reduce the amount of cash available to meet expenses and pay dividends. If we are unable to re-rent properties on favorable terms with respect to properties at which tenants default on their rent obligation or do not renew their leases at lease expiration, our results of operations, cash flow and financial condition will be adversely affected.
Approximately 21.1% of our 2025 contractual rental income is derived from five tenants. The default, financial distress or failure of any of these tenants, or such tenant’s determination not to renew or extend their lease, would significantly reduce our revenues.
FedEx, Northern Tool, NARDA Holdings, Inc., Havertys and Ferguson account for approximately 5.2%, 4.3%, 4.2%, 3.9% and 3.5%, respectively, of our 2025 contractual rental income, and the weighted average remaining lease term for such tenants is 2.7 years, 4.3 years, 8.7 years, 3.7 years and 2.6 years, respectively. The default, financial distress or bankruptcy of any of these or other significant tenants or such tenant’s determination not to renew or extend their lease, would significantly reduce our revenues, would cause interruptions in the receipt of, or the loss of, a significant amount of rental income and would require us to pay operating expenses (including real estate taxes) currently paid by the tenant. This could also result in the vacancy of the property or properties occupied by the defaulting or non-renewing tenant, which would significantly reduce our rental revenues and net income until the re-rental of the property or properties and could decrease the ultimate sale value of the property.
The concentration of our properties in certain states makes our revenues and the value of our portfolio vulnerable to adverse changes in local economic conditions.
Approximately 46.9% of our 2025 contractual rental income is derived from properties located in six states - South Carolina (11.7%), New York (9.5%), Texas (7.9%), Pennsylvania (7.9%), Maryland (5.2%) and Iowa (4.7%). As a result, a decline in the economic conditions in these states or in regions where our properties are concentrated, may have an adverse effect on the rental and occupancy rates for, and the property values of, these properties, which could lead to a reduction of our rental income and/or impairment charges.
Our portfolio of properties is concentrated in the industrial and retail real estate sectors, and our business would be adversely affected by an economic downturn in either of such sectors.
Approximately 72.4% and 21.1% of our 2025 contractual rental income is derived from industrial and retail tenants, respectively, and we are vulnerable to economic declines that negatively impact these sectors of the economy, which would have an adverse effect on our results of operations, liquidity and financial condition.
Write-offs of unbilled rent receivables and intangible lease assets will reduce our net income, total assets and stockholders’ equity and may result in breaches of financial covenants under our credit facility.
At December 31, 2024, the aggregate of our unbilled rent receivable and intangible lease assets is $30.6 million (including $13.6 million of intangible lease assets): five tenants (i.e., NARDA Holdings, Inc., Northern Tool, Famous Footwear, The Lion Brewery, and Q.E.P. Co., Inc.) account for 30.2% of such sum. We are required to assess the collectability of our unbilled rent receivables and the remaining useful lives of our intangible lease assets. Such assessments, which are highly subjective, take into consideration, among other things, a tenant’s payment history, financial condition, and the likelihood of collectability of future rent. If we determine that the collectability of a tenant’s unbilled rent receivable is not probable or that the useful life of a tenant’s intangible lease asset has changed, write-offs would be required. Such write-offs result in a reduction of our net income, total assets and stockholders’ equity and in certain circumstances may result in the breach of our financial covenants under the credit facility.
Declines in the value of our properties could result in impairment charges.
When we are presented with indicators of impairment in the value of a particular property or group of properties, we are required to perform an impairment analysis for such property or properties. When we determine that any of our properties at which indicators of impairment exist have undiscounted cash flows below the net book value of such property, we are required to recognize an impairment charge for the difference between the fair value and the book value during the quarter in which we make such determination. Impairment charges reduce our net income and stockholder’s equity.
Our ability to fully control the maintenance of our net-leased properties may be limited.
The tenants of our net-leased properties are responsible for maintenance and other day-to-day management of the properties. If a property is not adequately maintained in accordance with the terms of the applicable lease, we may incur expenses for deferred maintenance or other liabilities once the property is no longer leased. While we visit our properties on an intermittent basis, these visits are not comprehensive inspections and deferred maintenance items may go unnoticed. While our leases generally provide for recourse against the tenant in these instances, a bankrupt or financially-troubled tenant may be more likely to defer maintenance, and it may be more difficult to enforce remedies against such a tenant.
Traditional retail tenants account for 21.1% of our 2025 contractual rental income and the competition that such tenants face from e-commerce retail sales could adversely affect our business.
Approximately 21.1% of our 2025 contractual rental income is derived from retail tenants, including 4.8% from tenants engaged in selling furniture (i.e., Havertys Furniture accounts for 3.9% of 2025 contractual rental income) and 2.1% from a tenant engaged in selling office supplies (i.e., Office Depot, a tenant at five properties, two of which are currently closed but for which the tenant continues to pay rent and the lease expires in May 2025). Because e-commerce retailers (unlike “bricks and mortar” or “traditional” retailers) may be able to provide customers with better pricing and the ease, comfort and safety of shopping from their home or office, our retail tenants face extensive competition from e-commerce retailers. E-commerce sales decrease the need for traditional retail outlets and reduce retailers’ space and property requirements. This adversely impacts our ability to rent space at our retail properties and increases competition for retail tenants thereby reducing the rent we would receive at these properties and adversely affecting our results of operations, cash flow and financial condition.
Risks Related to Our Financing Activities, Indebtedness and Capital Resources
If we are unable to refinance our mortgage loans at maturity, we may be forced to sell properties at disadvantageous terms, which would result in the loss of revenues and in a decline in the value of our portfolio.
We had, as of December 31, 2024, $425.0 million in mortgage debt outstanding (all of which is non-recourse subject to standard carve-outs). The risks associated with our mortgage debt, include the risks that cash flow from properties securing the indebtedness and our available cash and cash equivalents will be insufficient to meet required payments of principal and interest.
Generally, only a portion of the principal of our mortgage indebtedness will be repaid prior to or at maturity and we do not plan to retain sufficient cash to repay such indebtedness at maturity. Accordingly, to meet these obligations if they cannot be refinanced at maturity, we will have to use funds available under our credit facility, if any, and our available cash and cash equivalents to pay our mortgage debt or seek to raise funds through the financing of unencumbered properties, sale of properties or the issuance of additional equity. From 2025 through 2029, approximately $189.0 million of our mortgage debt matures. If we are unsuccessful in refinancing or extending existing mortgage indebtedness or financing unencumbered properties, selling properties on favorable terms or raising additional equity, our cash flow will be insufficient to repay all maturing mortgage debt when payments become due, and we may be forced to dispose of properties on disadvantageous terms or convey properties secured by mortgages to the mortgagees, which would lower our revenues and the value of our portfolio.
We may find that the value of a property could be less than the mortgage secured by such property. We may also have to decide whether we should refinance or pay off a mortgage on a property at which the mortgage matures prior to lease expiration and the tenant may not renew the lease. In these types of situations, after evaluating various factors, including among other things, the tenant’s competitive position in the applicable sub-market, our and our tenant’s estimates of its prospects, consideration of alternative uses and opportunities to re-purpose or re-let the property, we may seek to renegotiate the terms of the mortgage, or to the extent that the loan is non-recourse and the terms of the mortgage cannot be satisfactorily renegotiated, forfeit the property by conveying it to the mortgagee and writing off our investment.
Volatile or increasing interest rates, or credit market tightening, may make it more difficult for us to secure financing, which may limit our ability to finance or refinance our real estate properties, reduce the number of properties we can acquire, sell certain properties, and decrease our stock price.
Increases or volatility in interest rates, or reduced access to credit markets, may make it difficult for us to obtain financing, refinance mortgage debt, limit the mortgage debt available on properties we wish to acquire and limit the properties we can acquire. Even in the event that we are able to secure mortgage debt on, or otherwise finance our real estate properties, due to increased costs associated with securing financing and other factors beyond our control, we may be unable to refinance the entire outstanding loan balance or be subject to unfavorable terms (such as higher loan fees, interest rates and periodic payments). In addition, increasing interest rates could decrease the amount third parties are willing to pay for our assets, thereby limiting our ability to dispose of assets on more favorable terms.
Interest rates have been volatile as the interest rate on the ten-year treasury notes ranged from 1.51% to 5.02% during the three years ended December 31, 2024. At February 28, 2025, the interest rate on such notes was 4.22%. If we are required to refinance mortgage debt that matures over the next several years at higher interest rates than such mortgage debt currently bears, the funds available for dividends may be reduced. The following table sets forth, as of December 31, 2024, the principal balance of the mortgage payments due at maturity on our properties and the weighted average interest rate thereon (dollars in thousands):
Principal
Balances
Weighted Average
Due at
Interest Rate
Year
Maturity
Percentage
$
22,458
4.17
18,461
3.91
38,525
3.64
30,155
4.64
79,386
4.41
2030 and thereafter
159,172
5.02
We manage a substantial portion of our exposure to interest rate risk by accessing debt with staggered maturities, obtaining fixed rate mortgage debt and by fixing the interest rate on substantially all of our variable rate debt through the use of interest rate swap agreements. However, no amount of hedging activity can fully insulate us from the risks associated with volatile changes in interest rates. Swap agreements involve risk, including that counterparties may fail to honor their obligations under these arrangements, and these arrangements have caused us to pay higher interest rates on our debt obligations than would otherwise be the case. Failure to hedge effectively against interest rate risk could adversely affect our results of operations and financial condition.
Because REIT stocks are often perceived as high-yield investments, investors may perceive less relative benefit to owning REIT stocks as interest rates and the yield on government treasuries and other bonds increase or are especially volatile. Accordingly, increases and volatility in interest rates may reduce the amount investors are willing to pay for our common stock.
If our borrowings increase, the risk of default on our repayment obligations and our debt service requirements will also increase.
At December 31, 2024, we had $425.0 million of debt outstanding all related to our mortgage debt and no debt outstanding on our credit facility. Increased leverage, whether pursuant to our credit facility or mortgage debt, could result in increased risk of default on our payment obligations related to borrowings and in an increase in debt service requirements, which could reduce our net income and the amount of cash available to meet expenses and to pay dividends.
A breach of our credit facility could occur if a significant number of our tenants default or fail to renew expiring leases, or we take impairment charges against our properties.
Our credit facility includes covenants that require us to maintain certain financial ratios and comply with other requirements. If our tenants default under their leases or fail to renew expiring leases, we may recognize impairment charges against our properties, and our financial position could be adversely affected causing us to be in breach of the financial covenants contained in our credit facility.
Failure to meet interest and other payment obligations under our revolving credit facility or a breach by us of the covenants to maintain the financial ratios could place us in default under our credit facility. In such event, if no amounts were outstanding under the facility, we would not be entitled to draw on the facility which could impede our ability, among other things, to acquire properties or fund working capital requirements. If we defaulted on the facility while amounts were outstanding, the lenders could require us to repay the full amount outstanding, and we might be required to rapidly dispose of our properties, which could have an adverse impact on the amounts we receive on such dispositions. If we are unable to dispose of our properties in a timely fashion to the satisfaction of the banks, the banks could foreclose on that portion of our collateral pledged to the banks, which could result in the disposition of our properties at below-market values. The disposition of our properties at below our carrying value would adversely affect our net income, reduce our stockholders’ equity and adversely affect our ability to pay dividends.
Certain of our leases require us to pay property related expenses that are not the obligations of our tenants.
In addition to satisfying their rent obligations, our tenants are generally responsible for the payment of real estate taxes, insurance and ordinary maintenance and repairs. However, under the provisions of certain leases, we are required to pay some expenses, such as the costs of environmental liabilities, roof and structural repairs, insurance premiums, and certain non-structural repairs and maintenance. If our properties incur significant expenses that must be paid by us under the terms of our leases, our business, financial condition and results of operations will be adversely affected and the amount of cash available to meet expenses and pay dividends may be reduced.
Our failure to comply with our obligations under our mortgages may reduce our stockholders’ equity, and adversely affect our net income and ability to pay dividends.
Several of our mortgages include covenants that require us to maintain certain financial ratios, including various coverage ratios, and comply with other requirements. Failure to meet interest and other payment obligations under these mortgages or a breach by us of the covenants to comply with certain financial ratios would place us in non-compliance under such mortgages. If a mortgagee called a default and required us to repay the full amount outstanding under such mortgage, we might be required to rapidly dispose of the property subject to such mortgage which could have an adverse impact on the amounts we receive on such disposition. If we are unable to satisfy the covenants of a mortgage, the mortgagee could exercise remedies available to it under the applicable mortgage and as otherwise provided by law, including the possible appointment of a receiver to manage the property, application of deposits or reserves maintained under the mortgage for payment of the debt, or foreclose and/or cause the forced sale of the property or asset securing such debt. A foreclosure or other forced disposition of our assets could result in the disposition of such assets at below such assets’ carrying values. The disposition of our properties or assets at below their carrying values may adversely affect our net income, reduce our stockholders’ equity and adversely affect our ability to pay dividends.
Risks Related to Real Estate Investments
Our revenues and the value of our portfolio are affected by a number of factors that affect investments in leased real estate generally.
We are subject to the general risks of investing in leased real estate. These include the non-performance of lease obligations by tenants, leasehold improvements that will be costly or difficult to remove should it become necessary to re-rent the leased space for other uses, covenants in certain retail leases that limit the types of tenants to which available space can be rented (which may limit demand or reduce the rents realized on re-renting), rights to terminate leases due to co-tenancy provisions, events of casualty or condemnation affecting the leased space or the property or due to interruption of the tenant’s quiet enjoyment of the leased premises, obligations of a landlord to restore the leased premises or the property following events of casualty or condemnation, adverse changes in economic conditions and local conditions (e.g., changing demographics, retailing trends and traffic patterns), declines in rental rates, changes in the supply and price of quality properties and the market supply and demand of competing properties, the impact of environmental laws, security concerns, prepayment penalties applicable under mortgage financings, changes in tax, zoning, building code, fire safety and other laws and regulations, the type of insurance coverage available, and changes in the type, capacity and sophistication of building systems. The occurrence of any of these events could adversely impact our results of operations, liquidity and financial condition.
Real estate investments are relatively illiquid and their values may decline.
Real estate investments are relatively illiquid. Therefore, we will be limited in our ability to reconfigure our real estate portfolio in response to economic changes. We may encounter difficulty in disposing of properties when tenants vacate either at the expiration of the applicable lease or otherwise. If we decide to sell any of our properties, our ability to sell these properties and the prices we receive on their sale may be affected by many factors, including the number of potential buyers, the number of competing properties on the market and other market conditions, as well as whether the property is leased and if it is leased, the terms of the lease. As a result, we may be unable to sell our properties for an extended period of time without incurring a loss, which would adversely affect our results of operations, liquidity and financial condition.
Uninsured and underinsured losses may affect the revenues generated by, the value of, and the return from a property affected by a casualty or other claim.
Most of our tenants obtain, for our benefit, comprehensive insurance covering our properties in amounts that are intended to be sufficient to provide for the replacement of the improvements at each property. However, the amount of insurance coverage maintained for any property may be insufficient (i) to pay the full replacement cost of the improvements at the property following a casualty event or (ii) if coverage is provided pursuant to a blanket policy and the tenant’s other properties are subject to insurance claims. In addition, the rent loss coverage under the policy may not extend for the full period of time that a tenant may be entitled to a rent abatement as a result of, or that may be required to complete restoration following, a casualty event. In addition, there are certain types of losses, such as those arising from earthquakes, floods, hurricanes and terrorist attacks, that may be uninsurable or that may not be economically insurable. Changes in zoning, building codes and ordinances, environmental considerations and other factors also may make it impossible or impracticable for us to use insurance proceeds to replace damaged or destroyed improvements at a property. If restoration is not or cannot be completed to the extent, or within the period of time, specified in certain of our leases, the tenant may have the right to terminate the lease. If any of these or similar events occur, it may reduce our revenues, the value of, or our return from, an affected property.
We have been, and will continue to be, subject to significant competition and we may not be able to compete successfully for investments.
We have been, and will continue to face, significant competition for attractive investment opportunities, and in particular, opportunities to acquire industrial properties. Our competitors include publicly-traded REITs, non-traded REITs, insurance companies, commercial and investment banking firms, private institutional funds, hedge funds, private equity funds and other investors, many of whom have greater financial and other resources
than we have. We may not be able to compete successfully for investments. If we pay higher prices for investments, our returns may be lower and the value of our assets may not increase or may decrease significantly below the amount we paid for such assets. If such events occur, we may experience lower returns on our investments.
Our current and future investments in joint ventures could be adversely affected by the lack of sole decision making authority, reliance on joint venture partners’ financial condition or insurance coverage, disputes that may arise between our joint venture partners and us and our reliance on one significant joint venture partner.
Four properties in which we have an interest are owned through consolidated joint ventures (two properties) and unconsolidated joint ventures (two properties). We may continue to acquire properties through joint ventures and/or contribute some of our properties to joint ventures. Investments in joint ventures may, under certain circumstances, involve risks not present when a third party is not involved, including the possibility that joint venture partners might file for bankruptcy protection, fail to fund their share of required capital contributions or obtain insurance coverage pursuant to a blanket policy as a result of which claims with respect to other properties covered by such policy and in which we have no interest could reduce or eliminate the coverage available with respect to the joint venture properties. Further, joint venture partners may have conflicting business interests or goals, and as a result there is the potential risk of impasses on decisions, such as a sale and the timing thereof. Any disputes that may arise between joint venture partners and us may result in litigation or arbitration that would increase our expenses and prevent our officers and/or directors from focusing their time and effort on our business. Consequently, actions by or disputes with joint venture partners might result in subjecting properties owned by the joint venture to additional risk. With respect to our (i) consolidated joint ventures, we own, with two joint venture partners and their respective affiliates, properties that account for 3.9% of 2025 contractual rental income, and (ii) unconsolidated joint ventures, we own, with one joint venture partner and their affiliates, properties which account for our $233,000 share of 2025 base rent payable. We may be adversely affected if we are unable to maintain a satisfactory working relationship with these joint venture partners or if any of these partners becomes financially distressed.
Regulatory and Tax Risks
Compliance with environmental regulations and associated costs could adversely affect our results of operations and liquidity.
Under various federal, state and local laws, ordinances and regulations, an owner or operator of real property may be required to investigate and clean up hazardous or toxic substances or petroleum product releases at the property and may be held liable to a governmental entity or to third parties for property damage and for investigation and cleanup costs incurred in connection with contamination. The cost of investigation, remediation or removal of hazardous or toxic substances may be substantial, and the presence of such substances, or the failure to properly remediate a property, may adversely affect our ability to sell or rent the property or to borrow money using the property as collateral. In connection with our ownership, operation and management of real properties, we may be considered an owner or operator of the properties and, therefore, potentially liable for removal or remediation costs, as well as certain other related costs, including governmental fines and liability for injuries to persons and property, not only with respect to properties we own now or may acquire, but also with respect to properties we have owned in the past.
We cannot provide any assurance that existing environmental studies with respect to any of our properties reveal all potential environmental liabilities, that any prior owner of a property did not create any material environmental condition not known to us, or that a material environmental condition does not otherwise exist, or may not exist in the future, as to any one or more of our properties. If a material environmental condition does in fact exist, or exists in the future, the remediation costs could have a material adverse impact upon our results of operations, liquidity and financial condition.
Compliance with the Americans with Disabilities Act could be costly.
Under the Americans with Disabilities Act of 1990 (the “ADA”), all public accommodations must meet Federal requirements for access and use by disabled persons. A determination that our properties do not comply with the ADA could result in liability for both governmental fines and damages. If we are required to make unanticipated major modifications to any of our properties to comply with the ADA, which are determined not to be the responsibility of our tenants, we could incur unanticipated expenses that could have an adverse impact upon our results of operations, liquidity and financial condition.
Legislative or regulatory tax changes could have an adverse effect on us.
There are a number of issues associated with an investment in a REIT that are related to the Federal income tax laws, including, but not limited to, the consequences of our failing to continue to qualify as a REIT. At any time, the Federal income tax laws governing REITs or the administrative interpretations of those laws may be amended or modified. Any new laws or interpretations may take effect retroactively and could adversely affect us or our stockholders.
Risks Related to OLP’s Organization, Structure and Ownership of Stock
Our transactions with affiliated entities involve conflicts of interest.
From time to time we have entered into transactions with persons and entities affiliated with us and with certain of our officers and directors. Such transactions involve a potential conflict of interest and entail a risk that we could have obtained more favorable terms if we had entered into such transaction with an unaffiliated third party. We are a party to a compensation and services agreement with Majestic Property effective as of January 1, 2007, as amended. Pursuant to the compensation and services agreement, we pay an annual fee to Majestic Property which provides us with the Services. See “Item 1. Business-Human Capital Resources”. In 2024 we paid, and in 2025 we anticipate paying, Majestic Property, (i) a fee of $3.3 million and $3.4 million, respectively, and (ii) $336,000 and $350,000, respectively, for our share of all direct office expenses, including rent, telephone, postage, computer services, supplies, and internet usage. We also obtain our property insurance in conjunction with Gould Investors, an affiliated entity, and in 2024, reimbursed Gould Investors $1.2 million for our share of the insurance premiums paid by Gould Investors. At December 31, 2024, Gould Investors beneficially owns approximately 10.6% of our outstanding common stock and certain of our senior executive officers are also executive officers of the managing general partner of Gould Investors.
Our senior management and other key personnel, including those performing services on a part-time basis, are critical to our business and our future success depends on our ability to retain them.
We depend on the services of Matthew J. Gould, chairman of our board of directors, Fredric H. Gould, vice chairman of our board of directors, Patrick J. Callan, Jr., our president and chief executive officer, Lawrence G. Ricketts, Jr., our executive vice president and chief operating officer, Isaac Kalish, our chief financial officer and senior vice president and David W. Kalish, our senior vice president-financial, and other members of senior management to carry out our business and investment strategies. Of the foregoing executive officers, only Messrs. Callan and Ricketts devote all of their business time to us. Other members of senior management provide services to us either on a full-time or part-time, as-needed basis. The loss of the services of any of our senior management or other key personnel, the inability or failure of the members of senior management providing services to us on a part-time basis to devote sufficient time or attention to our activities or our inability to recruit and retain qualified personnel in the future, could impair our ability to carry out our business and investment strategies.
Certain provisions of our charter, our Bylaws, as amended, and Maryland law may inhibit a change in control that stockholders consider favorable and could also limit the market price of our common stock.
Certain provisions of our charter (the “Charter”), our Bylaws and Maryland law may impede, or prevent, a third party from acquiring control of us without the approval of our board of directors. These provisions:
● provide for a staggered board of directors consisting of three classes, with one class of directors being elected each year and each class being elected for three-year terms and until their successors are duly elected and qualify;
● impose restrictions on ownership and transfer of our stock (such provisions being intended to, among other purposes, facilitate our compliance with certain requirements under the Code, relating to our qualification as a REIT under the Code); and
● provide that directors may be removed only for cause and only by the vote of at least a majority of all outstanding shares entitled to vote.
Certain provisions of the Maryland General Corporation Law (the “MGCL”) may impede a third party from making a proposal to acquire us or inhibit a change of control under circumstances that otherwise could be in the best interest of holders of shares of our common stock, including:
● “control share” provisions that provide that, subject to certain exceptions, holders of “control shares” of our company (defined as voting shares which, when aggregated with other shares controlled by the stockholder, entitle the holder to exercise voting power in the election of directors within one of three increasing ranges) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of issued and outstanding “control shares,” subject to certain exceptions) have no voting rights with respect to the control shares except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares; and
● additionally, Title 3, Subtitle 8 of the MGCL permits our board of directors, without stockholder approval and regardless of what is currently provided in the Charter or the Bylaws, to implement certain corporate governance provisions.
Failure to qualify as a REIT could result in material adverse tax consequences and could significantly reduce cash available for distributions.
We operate so as to qualify as a REIT under the Code. Qualification as a REIT involves the application of technical and complex legal provisions for which there are limited judicial and administrative interpretations. The determination of various factual matters and circumstances not entirely within our control may affect our ability to qualify as a REIT. In addition, no assurance can be given that legislation, new regulations, administrative interpretations or court decisions will not significantly change the tax laws with respect to qualification as a REIT or the federal income tax consequences of such qualification. If we fail to quality as a REIT, we will be subject to federal, certain additional state and local income tax (including any applicable alternative minimum tax) on our taxable income at regular corporate rates and would not be allowed a deduction in computing our taxable income for amounts distributed to stockholders. In addition, unless entitled to relief under certain statutory provisions, we would be disqualified from treatment as a REIT for the four taxable years following the year during which qualification is lost. The additional tax would reduce significantly our net income and the cash available to pay dividends.
We are subject to certain distribution requirements that may result in our having to borrow funds at unfavorable rates.
To obtain the favorable tax treatment associated with being a REIT, we generally are required, among other things, to distribute to our stockholders at least 90% of our ordinary taxable income (subject to certain adjustments) each year. To the extent that we satisfy these distribution requirements but distribute less than 100% of our taxable income we will be subject to Federal and state corporate tax on our undistributed taxable income.
As a result of differences in timing between the receipt of income and the payment of expenses, and the inclusion of such income and the deduction of such expenses in arriving at taxable income, and the effect of nondeductible capital expenditures and the timing of required debt service (including amortization) payments, we may need to borrow funds in order to make the distributions necessary to retain the tax benefits associated with qualifying as a REIT, even if we believe that then prevailing market conditions are not generally favorable for such borrowings. Such borrowings could reduce our net income and the cash available to pay dividends.
Compliance with REIT requirements may hinder our ability to maximize profits.
In order to qualify as a REIT for Federal income tax purposes, we must continually satisfy tests concerning, among other things, our sources of income, the amounts we distribute to our stockholders and the ownership of our stock. We may also be required to make distributions to stockholders at disadvantageous times or when we do not have funds readily available for distribution. Accordingly, compliance with REIT requirements hinders our ability to operate solely on the basis of maximizing profits.
In order to qualify as a REIT, we must also ensure that at the end of each calendar quarter, at least 75% of the value of our assets consists of cash, cash items, government securities and real estate assets. Any investment in securities cannot include more than 10% of the outstanding voting securities of any one issuer or more than 10% of the total value of the outstanding securities of any one issuer. In addition, no more than 5% of the value of our assets can consist of the securities of any one issuer, other than a qualified REIT security. If we fail to comply with these requirements, we must dispose of such portion of these securities in excess of these percentages within 30 days after the end of the calendar quarter in order to avoid losing our REIT status and suffering adverse tax consequences. This requirement could cause us to dispose of assets for consideration that is less than their true value and could lead to an adverse impact on our results of operations and financial condition.
If we reduce or do not increase our dividend, the market value of our common stock may decline.
The dividends we pay are determined by our board of directors from time-to-time based on its assessment of, among other things, our short and long-term cash and liquidity requirements, prospects, debt maturities, maintenance of our REIT status, projections of our REIT taxable income, net income, funds from operations and adjusted funds from operations. Various factors could cause our board of directors to decrease or not increase our dividend, including tenant defaults or bankruptcies resulting in a material reduction in our funds from operations, a material loss resulting from an adverse change in the value of one or more of our properties, or insufficient income to cover our dividends. It is possible that a portion of the dividends we would pay in 2025 or thereafter would constitute a return of capital and in such event we would not be required to pay such sum to maintain our REIT status. If our board of directors determines to reduce or not increase our dividend for the foregoing or any other reason, the market value of our common stock could be adversely affected.
The stock market is volatile, and fluctuations in our operating results, removal from various indices and other factors could cause our stock price to decline.
The stock market has experienced, and may continue to experience, fluctuations that significantly impact the market prices of securities issued by many companies. Market fluctuations could adversely affect our stock price. These fluctuations have often been unrelated or disproportionate to the operating performance of particular companies. These broad market fluctuations, as well as general economic, systemic, political and market conditions, such as pandemics, recessions, loss of investor confidence, interest rate changes, government shutdowns, or trade wars, may negatively affect the market price of our common stock. Moreover, our operating results may fluctuate and vary from period to period due to the risk factors set forth herein.
Although our common stock is quoted on the New York Stock Exchange, the volume of trades on any given day has been limited historically, as a result of which stockholders might not have been able to sell or purchase our common stock at the volume, price or time desired. Further, if our common stock is removed from the Russell 3000® Index because it does not meet the criteria for continued inclusion in such index, index funds, institutional investors, or other holders attempting to track the composition of that index may be required to sell our common stock, which would adversely impact the price and frequency at which it trades.
General Business Risks
Enhanced market and economic volatility due to adverse economic and geopolitical conditions, health crises or dislocations in the credit markets, could have a material adverse effect on our results of operations, financial condition and ability to pay dividends.
Our business may be adversely affected by market and economic volatility experienced by the U.S. and global economies, the real estate industry as a whole and/or the local economies in the markets in which our properties are located. Such adverse conditions may be due to, among other issues, rising inflation and interest rates, volatility in the public equity and debt markets, labor market challenges and international economic and other conditions, including pandemics, geopolitical instability (such as the conflicts in Ukraine and the Middle East), sanctions and other conditions beyond our control. These current conditions, or similar conditions existing in the future, may adversely affect our results of operations, financial condition and ability to pay dividends as a result of one or more of the following, among other potential consequences:
• the financial condition of our tenants may be adversely affected, which may result in lower rents or tenant defaults;
• current or potential tenants may delay or postpone entering into long-term net leases with us;
• the ability to borrow on acceptable terms and conditions may be limited or unavailable, which could reduce our ability to pursue acquisitions, dispositions and refinance existing debt, reduce our returns from acquisition and disposition activities, increase our future interest expense and reduce our ability to make cash distributions to our stockholders;
• our ability to access the capital markets may be restricted at a time when we would like, or need, to access those markets, which could have an impact on our flexibility to react to changing economic and business conditions;
• the recognition of impairment charges on or reduced values of our properties, which may adversely affect our results of operations or limit our ability to dispose of assets at attractive prices and may reduce the availability of financing;
• our line of credit lenders could refuse to fund their financing commitment to us, or could fail, and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all; and
• one or more counterparties to our derivative financial instruments could default on their obligations to us, or could fail, increasing the risk that we may not realize the benefits of these instruments.
Breaches of information technology systems could materially harm our business and reputation.
We collect and retain on information technology systems, certain financial, personal and other sensitive information provided by third parties, including tenants, vendors, employees and joint venture partners. We also rely on information technology systems for the collection and distribution of funds. We have been, and continue to be, subject to cybersecurity attacks although we have not incurred any significant loss therefrom. There can be no assurance that we will be able to prevent unauthorized access to sensitive information or the unauthorized distribution of funds. Any loss of this information or unauthorized distribution of funds as a result of a cybersecurity attack may result in loss of funds to which we are entitled, legal liability and costs (including damages and penalties), as well as damage to our reputation, that could materially and adversely affect our business.
Actual or threatened epidemics, pandemics, outbreaks, or other public health crises may adversely affect our tenants’ financial condition and the profitability of our properties.
Our business and the businesses of our tenants could be materially and adversely affected by the risks, or the public perception of the risks, related to an epidemic, pandemic, outbreak, or other public health crisis, such as the COVID-19 pandemic. The risk, or public perception of the risk, of a pandemic or media coverage of infectious diseases could cause customers to avoid retail properties, and with respect to our properties generally, could cause temporary or long-term disruptions in our tenants’ supply chains and/or delays in the delivery of our tenants’ inventory. Moreover, an epidemic, pandemic, outbreak or other public health crisis, such as COVID-19, could cause the on-site employees of our tenants to avoid our tenants’ properties, which could adversely affect our tenants’ ability to adequately manage their businesses. Risks related to an epidemic, pandemic or other health crisis, such as COVID-19, could also lead to the complete or partial closure of one or more of our tenants’ stores or facilities. Such events could adversely impact our tenants’ sales and/or cause the temporary closure of our tenants’ businesses, which could severely disrupt their operations and the rental revenue we generate from our leases with them. The ultimate extent of the impact of any epidemic, pandemic or other health crisis on our business, financial condition and results of operations will depend on future developments, which are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of such epidemic, pandemic or other health crisis and actions taken to contain or prevent their further spread, among others. These and other potential impacts of an epidemic, pandemic or other health crisis, such as COVID-19, could therefore materially and adversely affect our business, financial condition and results of operations.
The failure of any bank in which we deposit our funds could have an adverse impact on our financial condition.
We have diversified our cash and cash equivalents between several banking institutions in an attempt to minimize exposure to any one of these entities. However, the Federal Deposit Insurance Corporation only insures accounts in amounts up to $250,000 per depositor per insured bank. We currently have cash and cash equivalents deposited in certain financial institutions significantly in excess of federally insured levels. If any of the banking institutions in which we have deposited funds ultimately fails, we may lose our deposits over $250,000. The loss of our deposits may have an adverse effect on our financial condition.
We are dependent on third party software for our financial reporting processes and systems.
We are dependent on third party software, and in particular, Yardi’s property management software, for generating tenant invoices, collecting receivables, paying payables and preparing financial reports. If the software does not perform as required (including non-performance resulting from the software vendors’ unwillingness or inability to maintain or upgrade the functionality of the software), our ability to conduct operations would be adversely affected.

---

ITEM 1B. UNRESOLVED STAFF COMMENTS
Item 1B. Unresolved Staff Comments.
None.

---

ITEM 2. PROPERTIES
Item 2. Properties.
Our principal executive office is located at 60 Cutter Mill Road, Suite 303, Great Neck, New York. We believe that our facilities are satisfactory for our current and projected needs.
Our Properties
As of December 31, 2024, we own 100 properties with an aggregate net book value of $672.3 million. Our occupancy rate, based on square footage, was 99.2%, 98.8% and 99.8% as of December 31, 2024, 2023 and 2022, respectively. The following table details, as of December 31, 2024, certain information about our properties (except as otherwise indicated, each property is tenanted by a single tenant):
Percentage of
Approximate
2025 Contractual
2025 Contractual
Square Footage
Rental Income
Location
Type of Property
Rental Income
of Building
per Square Foot
Fort Mill, SC
Industrial
4.3
701,595
$
4.46
Hauppauge, NY
Industrial
4.2
201,614
$
14.98
Baltimore, MD
Industrial
3.5
367,000
$
6.87
El Paso, TX
Industrial
3.3
419,821
$
5.72
Royersford, PA (1)
Retail
3.3
194,600
$
12.46
Fort Mill, SC
Industrial
3.2
303,188
$
7.48
Council Bluffs, IA (2)
Industrial
3.0
302,347
$
7.18
Lebanon, TN
Industrial
3.0
540,200
$
3.93
Delport, MO (3)
Industrial
2.4
339,094
$
5.14
Littleton, CO (4)
Retail
2.2
94,166
$
19.25
Pittston, PA
Industrial
2.1
249,600
$
5.98
El Paso, TX (5)
Retail
2.0
110,179
$
13.32
McCalla, AL
Industrial
2.0
294,000
$
4.80
Brooklyn, NY
Office
1.9
66,000
$
20.39
Moorestown, NJ
Industrial
1.7
219,881
$
5.69
Ankeny, IA (3)
Industrial
1.7
208,234
$
5.92
Lowell, AR
Industrial
1.7
248,370
$
4.95
Joppa, MD
Industrial
1.7
258,710
$
4.69
St. Louis Park, MN (3)
Retail
1.7
131,710
$
9.00
Englewood, CO
Industrial
1.5
63,882
$
16.89
Tucker, GA
Health & Fitness
1.4
58,800
$
17.45
Pennsburg, PA (3)
Industrial
1.4
291,203
$
3.43
Dalton, GA
Industrial
1.3
212,740
$
4.46
Indianapolis, IN
Industrial
1.2
125,622
$
7.13
Greenville, SC (2)
Industrial
1.2
142,200
$
5.97
Bakersfield, CA
Industrial
1.1
218,116
$
3.78
Huntersville, NC
Industrial
1.1
78,319
$
10.47
Lehigh Acres, FL (3)
Industrial
1.1
103,044
$
7.43
Ronkonkoma, NY (3)
Industrial
1.0
90,599
$
8.34
Green Park, MO
Industrial
1.0
119,680
$
6.02
Greensboro, NC
Theater
1.0
61,213
$
11.41
Ashland, VA
Industrial
0.9
88,003
$
7.73
New Hope, MN (2)
Industrial
0.9
123,892
$
5.46
Memphis, TN
Industrial
0.9
224,749
$
2.94
New Hyde Park, NY
Industrial
0.9
38,000
$
17.18
Chandler, AZ
Industrial
0.9
62,121
$
10.44
Louisville, KY
Industrial
0.9
125,370
$
5.13
Northwood, OH (3)
Industrial
0.9
123,500
$
5.14
Moorestown, NJ
Industrial
0.9
64,000
$
9.80
Bensalem, PA (6)
Industrial
0.9
85,663
$
7.33
Northwood, OH (7)
Industrial
0.8
126,990
$
4.82
Omaha, NE
Industrial
0.8
101,584
$
5.85
Nashville, TN (8)
Industrial
0.8
99,500
$
9.11
Melville, NY
Industrial
0.8
51,351
$
11.56
Greenville, SC (2)
Industrial
0.8
128,000
$
4.44
Shakopee, MN
Industrial
0.8
114,000
$
4.97
Monroe, NC
Industrial
0.8
93,170
$
6.05
Blythewood, SC (3)
Industrial
0.8
177,040
$
3.15
Percentage of
Approximate
2025 Contractual
2025 Contractual
Square Footage
Rental Income
Location
Type of Property
Rental Income
of Building
per Square Foot
Greenville, SC
Industrial
0.8
88,800
$
6.26
Saco, ME
Industrial
0.7
131,400
$
3.92
Cedar Park, TX
Retail-Furniture
0.7
50,810
$
10.00
Tyler, TX
Retail-Furniture
0.7
72,000
$
6.75
Fort Myers, FL
Industrial
0.7
52,710
$
9.20
Lake Charles, LA (9)
Retail-Office Supply
0.7
54,229
$
11.23
Lexington, KY
Industrial
0.7
74,150
$
6.50
Rincon, GA
Industrial
0.7
95,000
$
5.06
Indianapolis, IN
Theater
0.7
57,688
$
8.28
Durham, NC
Industrial
0.7
46,181
$
10.30
Plymouth, MN
Industrial
0.6
82,565
$
5.58
Highland Ranch, CO (3)
Retail
0.6
42,920
$
10.39
Albuquerque, NM
Industrial
0.6
63,421
$
6.94
Eugene, OR
Retail-Office Supply
0.6
24,978
$
17.32
Deptford, NJ
Retail
0.6
25,358
$
16.90
Newark, DE
Other
0.6
23,547
$
18.13
Richmond, VA
Retail-Furniture
0.6
38,788
$
10.53
Hillside, IL (3)
Industrial
0.6
60,832
$
6.69
Amarillo, TX
Retail-Furniture
0.6
72,027
$
5.64
El Paso, TX
Retail-Office Supply
0.6
25,000
$
16.08
Champaign, IL (3)
Retail
0.6
50,940
$
7.85
Lexington, KY
Retail-Furniture
0.5
30,173
$
12.48
Savannah, GA
Industrial
0.5
35,249
$
10.64
Newport, VA
Retail-Furniture
0.5
49,865
$
7.09
LaGrange, GA
Industrial
0.5
80,000
$
4.39
Naples, FL
Retail-Furniture
0.5
15,912
$
20.57
Greensboro, NC
Retail
0.4
12,950
$
24.00
Somerville, MA
Retail
0.4
12,054
$
25.72
Gurnee, IL
Retail-Furniture
0.4
22,768
$
13.43
Selden, NY
Retail
0.4
14,555
$
21.00
Bluffton, SC
Retail-Furniture
0.4
35,011
$
7.92
Crystal Lake, IL
Retail
0.4
32,446
$
8.25
Pinellas Park, FL
Industrial
0.3
53,064
$
4.61
Chicago, IL
Retail-Office Supply
0.3
23,939
$
10.15
Hyannis, MA
Retail
0.3
9,750
$
24.85
Chandler, AZ
Industrial
0.3
25,035
$
9.58
Myrtle Beach, SC
Restaurant
0.3
6,734
$
34.85
Everett, MA
Retail
0.3
18,572
$
11.43
Cary, NC
Retail-Office Supply
0.3
33,490
$
6.09
Marston, MA
Retail
0.3
8,775
$
22.00
Monroeville, PA
Retail
0.2
6,051
$
27.83
West Palm Beach, FL
Industrial
0.2
10,634
$
15.04
Batavia, NY
Retail
0.2
23,483
$
6.60
South Euclid, OH
Retail
0.2
11,672
$
9.94
Cuyahoga Falls, OH
Retail
0.1
6,796
$
12.49
Seattle, WA
Retail
0.1
3,053
$
27.50
Rosenberg, TX
Retail
0.1
8,000
$
10.20
Port Clinton, OH
Retail
0.1
6,749
$
10.98
Louisville, KY
Industrial
0.1
9,642
$
7.10
Beachwood, OH (10)
Land
-
349,999
$
-
Bolingbrook, IL (11)
Retail
-
33,111
$
-
Concord, NC (12)
Restaurant
-
4,749
$
-
100.0
10,870,285
(1) This property, a community shopping center, is leased to 11 tenants. Contractual rental income per square foot excludes 3,125 square feet of vacant space.
(2) This property has three tenants.
(3) This property has two tenants.
(4) This property, a community shopping center, is leased to 19 tenants. Contractual rental income per square foot excludes 10,433 square feet of vacant space.
(5) This property has four tenants. Contractual rental income per square foot excludes 2,395 square feet of unleasable vacant space.
(6) This property has three tenants. Contractual rental income per square foot excludes 143 square feet of unleasable vacant space.
(7) This property has five tenants.
(8) This property has two tenants. Contractual rental income per square foot excludes 34,362 square feet of vacant space.
(9) This property has three tenants. One tenant, Party City, filed for Chapter 11 bankruptcy protection; as such, contractual rental income excludes $188,000 related to this tenant.
(10) This property is ground leased to a multi-unit apartment complex owner/operator. As the property has not generated specified levels of positive operating cash flows, the tenant has not been required to pay rent since October 2020. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Challenges and Uncertainties Facing The Vue - Beachwood, Ohio” and Note 6 of our consolidated financial statements.
(11) The tenant’s lease expired January 31, 2024 and we are pursuing the re-lease and/or sale of such property.
(12) This property was sold on January 21, 2025.
Properties Owned by Joint Ventures
As of December 31, 2024, we own a 50% equity interest in two joint ventures that own two properties. At December 31, 2024, our investment in these joint ventures was approximately $2.1 million and the occupancy rate at these properties, based on square footage, was 100%. Based on the leases in effect at December 31, 2024, we anticipate that our share of the base rent payable in 2025 to our joint ventures is approximately $233,000. The following table sets forth, as of December 31, 2024, information about the properties owned by these joint ventures:
Percentage of
Base Rent Payable
in 2025
Contributed by
Approximate
Type of
the Applicable
Square Footage
Base Rent
Location
Property
Joint Venture (1)
of Building
per Square Foot
Savannah, GA
Retail
85.8
46,058
$
4.34
Savannah, GA (2)
Restaurant
14.2
-
-
100.0
46,058
(1) Represents our share of the base rent payable in 2025 with respect to such joint venture property, expressed as a percentage of the aggregate base rent payable in 2025 by all of our joint venture properties.
(2) This property is a parking lot which is ground leased to a restaurant.
Geographic Concentration
As of December 31, 2024, the 100 properties owned by us are located in 31 states. The following table sets forth information, presented by state, related to our properties as of December 31, 2024:
Percentage of
Contractual
Contractual
Approximate
Number of
Rental
Rental
Building
State
Properties
Income
Income
Square Feet
South Carolina
$
8,440,000
11.70
1,582,568
New York
6,828,000
9.50
485,602
Texas
5,720,000
7.90
757,837
Pennsylvania
5,673,000
7.90
827,117
Maryland
3,736,000
5.20
625,710
Iowa
3,402,000
4.70
510,581
Tennessee
3,377,000
4.70
864,449
Georgia
3,181,000
4.40
481,789
Colorado
3,136,000
4.40
200,968
North Carolina
3,073,000
4.30
330,072
Minnesota
2,890,000
4.00
452,167
Missouri
2,462,000
3.40
458,774
New Jersey
2,306,000
3.20
309,239
Florida
1,982,000
2.80
235,364
Illinois
1,624,000
2.30
224,036
Kentucky
1,570,000
2.20
239,335
Ohio
1,521,000
2.10
625,706
Virginia
1,443,000
2.00
176,656
Alabama
1,411,000
2.00
294,000
Indiana
1,373,000
1.90
183,310
Arkansas
1,231,000
1.70
248,370
Massachusetts
958,000
1.30
49,151
Arizona
888,000
1.20
87,156
California
825,000
1.10
218,116
Nebraska
594,000
0.80
101,584
Maine
515,000
0.70
131,400
Louisiana
483,000
0.70
54,229
New Mexico
440,000
0.60
63,421
Oregon
433,000
0.60
24,978
Delaware
427,000
0.60
23,547
Washington
84,000
0.10
3,053
$
72,026,000
100.0
10,870,285
Mortgage Debt
At December 31, 2024, we had:
● 62 first mortgages secured by 63 of our 100 properties; and
● $425.0 million of mortgage debt outstanding with a weighted average interest rate of 4.56% and a weighted average remaining term to maturity of approximately 6.1 years. Substantially all of such mortgage debt bears fixed interest at rates ranging from 3.05% to 6.25% and contains prepayment penalties.
The following table sets forth scheduled principal mortgage payments due on our properties as of December 31, 2024 (dollars in thousands):
PRINCIPAL
YEAR
PAYMENTS DUE
$
33,542
29,499
48,524
39,511
86,670
Thereafter
187,232
Total
$
424,978
The mortgages on our properties are generally non-recourse, subject to standard carve-outs.

---

ITEM 3. LEGAL PROCEEDINGS
Item 3. Legal Proceedings.
Our subsidiary is a defendant in a lawsuit entitled Eastgate LLC, et al. v. OLP Beachwood OH LLC, in the U.S. District Court for the Northern District of Ohio, Eastern Division, with respect to our land parcel in Beachwood, Ohio. The plaintiffs own the office building adjacent to our parcel and, among other things, seek to declare as void and unenforceable, deed restrictions prohibiting the use of a portion of their property for multi-family residential purposes. The lawsuit is in the preliminary pleading stage and we believe we have meritorious defenses. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Challenges and Uncertainties Facing The Vue - Beachwood, Ohio.”

---

ITEM 4. MINE SAFETY DISCLOSURE
Item 4. Mine Safety Disclosures.
Not applicable.
Part II

---

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
Item 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Our common stock is listed on the New York Stock Exchange under the symbol “OLP.” As of February 28, 2025, there were approximately 235 holders of record of our common stock.
We qualify as a REIT for Federal income tax purposes. In order to maintain that status, we are required to distribute to our stockholders at least 90% of our annual ordinary taxable income. The amount and timing of future distributions will be at the discretion of our board of directors and will depend upon our financial condition, earnings, business plan, cash flow and other factors. We intend to make distributions in an amount at least equal to that necessary for us to maintain our status as a real estate investment trust for Federal income tax purposes.
Issuer Purchases of Equity Securities
As of February 28, 2025, we are authorized to repurchase up to $8.1 million of shares of our common stock through, among other things, open-market or privately negotiated transactions. There is no stated expiration date for our stock repurchase program. We did not repurchase any shares of our common stock in 2024.

---

ITEM 6. SELECTED FINANCIAL DATA
Item 6. [Reserved.]

---

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Overview
We are a self-administered and self-managed REIT focused on acquiring, owning and managing a geographically diversified portfolio consisting of industrial and, to a lesser extent, retail properties, many of which are subject to long-term leases. Most of our leases are “net leases” under which the tenant, directly or indirectly, is responsible for paying the real estate taxes, insurance and ordinary maintenance and repairs of the property. As of December 31, 2024, we own, in 31 states, 102 properties, including two properties owned by consolidated joint ventures and two properties owned through unconsolidated joint ventures.
Challenges and Uncertainties as a Result of the Volatile Economic Environment
There is significant economic uncertainty due, among other things, to volatile interest rates, the challenges presented by an inflationary/potential recessionary environment and the proposed policies of the current administration. As a result of this uncertainty, volatility and the related causes, we may be cautious in pursuing acquisition opportunities in 2025 and our ability to grow revenue, net income and cash flow through acquisitions may be adversely affected.
General Challenges and Uncertainties
In addition to the challenges and uncertainties as also described under “Cautionary Note Regarding Forward-Looking Statements”, “Item 1A. Risk Factors”, and “- Challenges and Uncertainties as a Result of the Volatile Economic Environment”, we, among other things, face additional challenges and uncertainties, including the possibility we will not be able to: lease our properties on terms favorable to us or at all; collect amounts owed to us by our tenants; renew or re-let, on acceptable terms, leases that are expiring or otherwise terminating; acquire or dispose of properties on acceptable terms; or grow, through acquisitions or otherwise, our property portfolio so as to generate additional rental and net income. If we are unable to address these challenges successfully, we may be unable to sustain our current level of dividend payments.
Other than with respect to our continuing focus on acquiring industrial properties, we generally seek to manage the risk of our real property portfolio and the related financing arrangements by (i) diversifying among locations, tenants, scheduled lease expirations, mortgage maturities and lenders, and (ii) minimizing our exposure to interest rate fluctuations. As a result, as of December 31, 2024:
● our 2025 contractual rental income is derived from the following property types: 72.4% from industrial, 21.1% from retail, 1.6% from theaters, 1.4% from health and fitness, 0.7% from restaurant, and 2.8% from other properties,
● there are five states with properties that account for 5% or more of 2025 contractual rental income, and one state that accounts for more than 10.0% of 2025 contractual rental income (i.e., South Carolina at 11.7%),
● there is one tenant at five properties that accounts for more than 5% of 2025 contractual rental income (i.e., FedEx at 5.2%),
● through 2034, there are five years in which the percentage of our 2025 contractual rental income represented by expiring leases equals or exceeds 10% (i.e., 19.8% in 2027, 16.2% in 2028, 12.9% in 2029, 10.6% in 2030 and 10.6% in 2033) - approximately 3.0% of our 2025 contractual rental income is represented by leases expiring in 2035 and thereafter,
● after giving effect to interest rate swap agreements, substantially all of our mortgage debt bears interest at fixed rates,
● in 2025, 2026 and 2027, 7.9%, 6.9% and 11.4%, respectively, of our total scheduled principal mortgage payments (i.e., amortization and balances due at maturity) is due, and
● there are two different counterparties to our portfolio of interest rate swaps: one counterparty, rated A2 or better by a national rating agency (i.e., Moody’s Long-Term Debt Ratings), accounts for 82.3%, or $11.5 million, of the notional value of our swaps; and one counterparty, rated A- by another rating provider (i.e., Kroll), accounts for 17.7%, or $2.4 million, of the notional value of such swaps.
We monitor the risk of tenant non-payments through a variety of approaches tailored to the applicable situation. Generally, based on our assessment of the credit risk posed by our tenants, we monitor a tenant’s financial condition through one or more of the following actions: reviewing tenant financial statements or other financial information, obtaining other tenant related information, reviewing changes in tenant payment patterns, regular contact with tenant’s representatives, tenant credit checks and regular management reviews of our tenants. We may sell a property if the tenant’s financial condition is unsatisfactory.
We monitor, on an ongoing basis, our expiring leases and generally approach tenants with expiring leases (including those subject to renewal options) at least a year prior to lease expiration to determine their interest in renewing their leases. During the three years ending December 31, 2027, 57 leases for 49 tenants at 36 properties representing $22.0 million, or 30.5%, of 2025 contractual rental income expire.
In acquiring properties, we balance an evaluation of the terms of the leases and the credit of the existing tenants with a fundamental analysis of the real estate to be acquired, which analysis takes into account, among other things, the estimated value of the property, local demographics and the ability to re-rent or dispose of the property on favorable terms upon lease expiration or early termination.
At December 31, 2024, we have unhedged variable rate mortgage debt in the principal amount of $7.3 million which bears a weighted average interest rate of 3.88%. The table below provides information about such debt as of December 31, 2024.
Current
Interest Rate
Property
Principal Amount
Maturity Date
Interest Rate
Reset Date
Lexington, Kentucky
$
5,139,000
June 2047
3.85
%
June 2029
Deptford, NJ
2,186,000
February 2041
3.95
February 2026
$
7,325,000
Challenges and Uncertainties Facing The Vue - Beachwood, Ohio
A multi-family complex, which we refer to as The Vue, ground leases from us the underlying land located in Beachwood, Ohio. Since 2018, the property has faced, and we anticipate that the property will continue to face, occupancy and financial challenges. As the property has not generated specified levels of positive operating cash flows, the tenant has not been required to pay rent since October 2020, and we anticipate that it will not pay rent in the near future. After giving effect to debt service, the property, during the past several years (other than 2024), has been operating on a negative cash flow basis, although management believes that the property’s operating performance is improving.
Since 2022 (through February 28, 2025), we provided The Vue with an aggregate of $3.5 million (including $109,000 from January 1, 2024 through February 28, 2025) to cover, among other things, operating cash flow shortfalls and capital expenditures, and the amount to be funded in 2025, if any, has not been definitively determined. At December 31, 2024, (i) there are no unbilled rent receivables, intangibles or tenant origination costs associated with this property and (ii) the net book value of our land subject to this ground lease is $17.4 million and is subordinate to $62.3 million of mortgage debt incurred by the owner/operator. Our cash flow will be adversely impacted by our funding of additional capital expenditures and operating expense shortfalls at the property (including our payment of the tenant’s debt service obligations) and the continuing non-payment of rent. If we determine that under GAAP the property has been impaired, we may incur a substantial impairment charge and if we sell the property, we may recognize a substantial loss. See Note 6 to our consolidated financial statements.
2024 and Recent Developments
In 2024:
● we acquired three industrial properties for an aggregate purchase price of $44.7 million. These properties account for $3.0 million, or 4.1%, of our 2025 contractual rental income.
● we sold 11 properties (i.e., six retail, two industrial, two health and fitness, and one restaurant) and one parcel at a multi-tenant retail property, for an aggregate net sales proceeds of $38.2 million and an aggregate net gain on sale of real estate of $18.0 million. The properties sold accounted for $2.7 million, or 3.0%, and $5.1 million, or 5.6%, of 2024 and 2023 rental income, net, respectively.
● as of December 31, 2024 and February 28, 2025, no amounts were outstanding on our $100.0 million credit facility.
Subsequent to December 31, 2024, we:
Purchases
● acquired, on January 16, 2025, two Class A industrial properties located in Theodore, Alabama (the “Alabama Purchase”), for $49.0 million, including a $29.0 million mortgage maturing in 2035 and bearing an interest rate of 6.12% (interest only for five years and then amortizing on a 30-year schedule). The two properties comprise an aggregate of 371,586 square feet, are located on approximately 31 acres and are leased to a total of four tenants with a weighted average remaining lease term of approximately seven years. We estimate that in 2025, these properties will generate an aggregate of approximately $3.0 million of contractual rental income and $1.7 million of interest expense.
● acquired, on February 6, 2025, a Class A industrial property located in Wichita, Kansas (the “Kansas Purchase”), for $13.3 million, including a $7.5 million mortgage maturing in 2030 and bearing an interest rate of 6.09% (interest only through maturity). The property comprises 138,000 square feet, is located on approximately 9.5 acres, is leased to one tenant and the lease expires in 2028. We estimate that in 2025, this property will generate approximately $800,000 of contractual rental income and $413,000 of interest expense.
● signed a contract, on February 6, 2025, to acquire a Class A industrial property located in Council Bluffs, Iowa (the “Council Bluffs II Purchase”; and together with the Alabama Purchase and the Kansas Purchase, the “New Properties”), for $26.0 million, including a $15.6 million mortgage maturing in 2035 and bearing an interest rate of 6.42% (interest only for five years and then amortizing on a 30-year schedule). The property comprises 236,324 square feet, is located on approximately 23.5 acres and is adjacent to a 302,347 square foot industrial property we acquired in 2024. The property is leased to two tenants and the weighted average remaining lease term is approximately six years. We estimate that the purchase will be completed in the first quarter of 2025 and that this property will generate, in 2025, approximately $1.5 million of contractual rental income and $800,000 of interest expense.
We estimate that after giving effect to the purchase of New Properties, 2025 contractual rental income will be approximately $77.3 million.
Sale
● sold, on January 21, 2025, a restaurant property located in Concord, North Carolina for $3.3 million and generated net proceeds of $3.1 million. This property accounted for $211,000 and $209,000 of rental income, net, $54,000 and $51,000 of depreciation and amortization expense, and $36,000 and $56,000 of mortgage interest expense for 2024 and 2023, respectively. We anticipate that we will recognize, during the quarter ending March 31, 2025, a gain of approximately $1.1 million from the sale of this property.
In January 2025, we terminated the previously announced contract to sell a multi-tenant retail center located in St. Louis Park, Minnesota.
Comparison of Years Ended December 31, 2024 and 2023
Results of Operations -
Revenues
The following table compares total revenues for the periods indicated:
Year Ended December 31,
Increase
(Dollars in thousands)
(Decrease)
% Change
Rental income, net
$
90,313
$
90,646
$
(333)
(0.4)
Lease termination fees
-
n/a
Total revenues
$
90,563
$
90,646
$
(83)
(0.1)
Rental income, net.
The following table details the components of rental income, net, for the periods indicated:
Year Ended December 31,
Increase
(Dollars in thousands)
(Decrease)
% Change
Acquisitions (1)
$
3,356
$
$
2,744
448.4
Dispositions (2)
2,718
7,569
(4,851)
(64.1)
Same store (3)
84,239
82,465
1,774
2.2
Rental income, net
$
90,313
$
90,646
$
(333)
(0.4)
(1) The 2024 column represents rental income from properties acquired since January 1, 2023; the 2023 column represents rental income from properties acquired during the year ended December 31, 2023.
(2) The 2024 column represents rental income from properties sold during the year ended December 31, 2024; the 2023 column represents rental income from properties sold since January 1, 2023.
(3) Represents rental income from 96 properties that were owned for the entirety of the periods presented.
Changes at same store properties
The increase in same store rental income is due to increases of:
- $1.4 million of rental income from various lease amendments and extensions,
- $975,000 in tenant reimbursements, of which $705,000 relates to real estate tax expenses generally incurred in the same year, and
- $819,000 of rental income due to new and/or replacement tenants at several properties.
The increase was offset by decreases of:
- $723,000 of rental income from our two Regal Cinemas properties due to lease amendments effectuated in connection with its bankruptcy reorganization, and
- $501,000 of rental income from leases that expired in 2023 and 2024 at several properties.
Lease Termination Fee
In March 2024, a consolidated joint venture in Lakewood, Colorado, in which we hold a 90% interest, received a lease termination fee of $250,000 from a tenant due to the early termination of its lease in connection with the sale of the related restaurant parcel.
Operating Expenses
The following table compares operating expenses for the periods indicated:
Year Ended December 31,
Increase
(Dollars in thousands)
(Decrease)
% Change
Operating expenses:
Depreciation and amortization
$
24,291
$
24,789
$
(498)
(2.0)
Real estate expenses
17,904
16,444
1,460
8.9
General and administrative
15,388
15,822
(434)
(2.7)
Impairment loss
1,086
-
1,086
n/a
State taxes
(283)
(99.6)
Total operating expenses
$
58,670
$
57,339
$
1,331
2.3
Depreciation and amortization. The decrease is due primarily to:
- the inclusion, in 2023, of $1.2 million of such expense from the properties sold since January 1, 2023, and
- a decrease, in 2024, of $1.2 million related to tenant origination costs at several same store properties that prior to December 31, 2024 were fully amortized.
The decrease was offset by:
- $1.2 million of such expense from four properties acquired in 2024 and 2023 (including $470,000 from the property acquired in 2023),
- $539,000 of depreciation from improvements at several same store properties, and
- $142,000 of leasing commissions at several same store properties.
Real estate expenses.
The increase is primarily due to:
- an aggregate increase of $671,000 relating to real estate tax expense for several same store properties, none of which was individually significant,
- $581,000 from properties acquired in 2024 and 2023 (including $426,000 from the property acquired in 2023), and
- aggregate increases of $410,000 of other real estate expenses (i.e., insurance and common area maintenance) for several same store properties, none of which was individually significant.
The increase was offset primarily by a $202,000 decrease related to properties sold in 2023 and 2024.
A substantial portion of real estate expenses are rebilled to tenants and are included in Rental income, net, on the consolidated statements of income.
General and administrative. The decrease in 2024 is due primarily to decreases in (i) non-cash compensation expense primarily due to the inclusion, in 2023, of $233,000 from the retirement, and related accelerated vesting, of an executive officer’s restricted stock awards, and (ii) professional fees of $166,000 related to litigation that has been settled.
Impairment loss. During 2024, we recorded a $1.1 million impairment loss at our former Hamilton, Ohio property tenanted by LA Fitness. (See Note 5 to our consolidated financial statements).
State taxes. During 2024, our state tax expense was offset by a $238,000 refund from Tennessee related to franchise taxes paid during 2020 through 2022, as the state amended the method of calculating such taxes, resulting in overpayments in such years.
Gain on sale of real estate, net
The following table lists the sold properties and related gains, net, for the periods indicated:
Year Ended
December 31,
(Dollars in thousands)
Restaurant parcel - Lakewood, Colorado (1)
$
1,784
$
-
Restaurant property - Kennesaw, Georgia
-
Industrial property - Miamisburg, Ohio
1,507
-
Retail property - Wichita, Kansas
1,884
-
Retail property - Lawrence, Kansas
-
Retail property - Cape Girardeau, Missouri (2)
-
Vacant retail property - Kennesaw, Georgia
2,072
-
Vacant health and fitness property - Hamilton, Ohio
-
Vacant industrial property - Wauconda, Illinois
1,177
-
Retail property - Woodbury, Minnesota
-
Retail property - Hilliard, Ohio
-
Health and fitness property - Secaucus, New Jersey
6,436
-
Restaurant property - Hauppauge, New York
-
1,534
Retail property - Duluth, Georgia
-
3,180
Restaurant property - Greensboro, North Carolina
-
Land parcel - Lakewood, Colorado (3)
-
2,177
Restaurant property - Indianapolis, Indiana
-
Restaurant property - Richmond, Virginia
-
Restaurant properties - Cartersville & Carrollton, Georgia
-
2,581
Restaurant property - Lawrenceville, Georgia
-
Retail property - Virginia Beach, Virginia
-
1,727
Retail property - Fort Myers, Florida
-
3,997
Total Gain on sale of real estate, net
$
18,007
$
17,008
(1) This restaurant parcel, at a multi-tenant shopping center, was owned through a consolidated joint venture in which we have a 90% interest. The non-controlling interest’s share of this gain was $178.
(2) This property was owned through a consolidated joint venture in which we had a 95% interest. The non-controlling interest’s share of this gain was $105.
(3) This land parcel, at a multi-tenant shopping center, was owned through a consolidated joint venture in which we have a 90% interest. The non-controlling interest’s share of the gain is $218.
Other Income and Expenses
The following table compares other income and expenses for the periods indicated:
Year Ended December 31,
Increase
(Dollars in thousands)
(Decrease)
% Change
Other income and expenses:
Equity in earnings (loss) of unconsolidated joint ventures
$
$
(904)
$
1,047
(115.8)
Equity in loss from sale of unconsolidated joint venture property
-
(108)
(100.0)
Other income
1,186
406.8
Interest:
Expense
(19,463)
(18,780)
3.6
Amortization and write-off of deferred financing costs
(968)
(839)
15.4
Equity in earnings (loss) of unconsolidated joint ventures. The 2023 period includes our 50% share of (i) an $850,000 impairment charge and (ii) $103,000 debt prepayment charge, related to the early payoff of the mortgage, in connection with the sale of our former Manahawkin, New Jersey joint venture property (the “Manahawkin Property”). The Manahawkin Property was sold in December 2023 - see Note 7 to our consolidated financial statements.
Equity in loss from sale of unconsolidated joint venture property. The 2023 results represent a loss of $108,000 from the sale of the Manahawkin Property.
Other income. The change in 2024 is due to an increase of $778,000 in interest income primarily from investments in short-term U.S. treasury bills.
Interest expense. The following table compares interest expense for the periods indicated:
Year Ended December 31,
Increase
(Dollars in thousands)
(Decrease)
% Change
Interest expense:
Mortgage interest
$
19,209
$
17,514
$
1,695
9.7
Credit line interest
1,266
(1,012)
(79.9)
Total
$
19,463
$
18,780
$
3.6
Mortgage interest
The following table reflects the weighted average interest rate on the weighted average principal amount of outstanding mortgage debt during the applicable year:
Year Ended December 31,
Increase
(Dollars in thousands)
(Decrease)
% Change
Weighted average principal amount
$
426,916
$
416,517
$
10,399
2.5
Weighted average interest rate
4.47
%
4.18
%
0.29
%
6.9
The increase in 2024 is due primarily to the increase in the weighted average interest rate on the principal amount of mortgage debt outstanding. Among other things, the mortgages (i) that we refinanced generally bore a higher interest rate than the mortgages we paid off and (ii) obtained in connection with acquisitions generally bore a higher rate of interest than the mortgages on properties we sold.
Credit facility interest
The decrease in credit line interest in 2024 is due to the payoff of the principal balance outstanding on the credit facility. The interest expense of $254,000 for 2024 constitutes the unused facility fee.
The weighted average interest rate was 6.69% for 2023 and the weighted average principal amount outstanding was $15.7 million
Funds from Operations and Adjusted Funds from Operations
We compute funds from operations, or FFO, in accordance with the “White Paper on Funds From Operations” issued by the National Association of Real Estate Investment Trusts (“NAREIT”) and NAREIT’s related guidance. FFO is defined in the White Paper as net income (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, impairment write-downs of certain real estate assets and investments in entities where the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis. In computing FFO, we do not add back to net income the amortization of costs in connection with our financing activities or depreciation of non-real estate assets.
We compute adjusted funds from operations, or AFFO, by adjusting FFO for straight-line rent accruals and amortization of lease intangibles, deducting from income (i) additional rent from a ground lease tenant, (ii) income on settlement of litigation, (iii) income on insurance recoveries from casualties, (iv) lease termination and assignment fees, and adding back to income (i) amortization of restricted stock and restricted stock unit compensation expense, (ii) amortization of costs in connection with its financing activities (including its share of its unconsolidated joint ventures), (iii) debt prepayment costs, (iv) amortization of lease incentives and (v) mortgage intangible assets. Since the NAREIT White Paper does not provide guidelines for computing AFFO, the computation of AFFO varies from one REIT to another.
We believe that FFO and AFFO are useful and standard supplemental measures of the operating performance for equity REITs and are used frequently by securities analysts, investors and other interested parties in evaluating equity REITs, many of which present FFO and AFFO when reporting their operating results. FFO and AFFO are intended to exclude GAAP historical cost depreciation and amortization of real estate assets, which assumes that the value of real estate assets diminish predictably over time. In fact, real estate values have historically risen and fallen with market conditions. As a result, we believe that FFO and AFFO provide a performance measure that when compared year over year, should reflect the impact to operations from trends in occupancy rates, rental rates, operating costs, interest costs and other matters without the inclusion of depreciation and amortization, providing a perspective that may not be necessarily apparent from net income. We also consider FFO and AFFO to be useful in evaluating potential property acquisitions.
FFO and AFFO do not represent net income or cash flows from operating, investing or financing activities as defined by GAAP. FFO and AFFO should not be considered to be an alternative to net income as a reliable measure of our operating performance; nor an alternative to cash flows from operating, investing or financing activities (as defined by GAAP) as measures of liquidity. FFO and AFFO do not measure whether cash flow is sufficient to fund all of our cash needs, including principal amortization, capital improvements and distributions to stockholders.
Management recognizes that there are limitations in the use of FFO and AFFO. In evaluating our performance, management is careful to examine GAAP measures such as net income and cash flows from operating, investing and financing activities.
The following tables provide a reconciliation of net income and net income per common share (on a diluted basis) in accordance with GAAP to FFO and AFFO for the years indicated (dollars in thousands, except per share amounts):
Year Ended
December 31,
GAAP net income attributable to One Liberty Properties, Inc.
$
30,417
$
29,614
Add: depreciation and amortization of properties
23,495
24,063
Add: our share of depreciation and amortization of unconsolidated joint ventures
Add: impairment loss
1,086
-
Add: amortization of deferred leasing costs
Add: our share of amortization of deferred leasing costs of unconsolidated joint ventures
Add: our share of impairment loss of unconsolidated joint venture property
-
Add: equity in loss from sale of unconsolidated joint venture property
-
Deduct: gain on sale of real estate, net
(18,007)
(17,008)
Adjustments for non-controlling interests
NAREIT funds from operations applicable to common stock
38,027
38,996
Deduct: straight-line rent accruals and amortization of lease intangibles
(2,745)
(2,717)
Adjust: our share of straight-line rent accruals and amortization of lease intangibles of unconsolidated joint ventures
(19)
Deduct: lease termination fee income
(250)
-
Deduct: other income and income on settlement of litigation
(110)
(112)
Deduct: our share of unconsolidated joint venture lease termination fee income
-
(21)
Deduct: additional rent from ground lease tenant
-
(16)
Add: amortization of restricted stock and RSU compensation
4,962
5,367
Add: amortization and write-off of deferred financing costs
Add: amortization of lease incentives
Add: amortization of mortgage intangible assets
Add: our share of amortization of deferred financing costs of unconsolidated joint venture
-
Adjustments for non-controlling interests
Adjusted funds from operations applicable to common stock
$
41,157
$
42,595
Year Ended
December 31,
GAAP net income attributable to One Liberty Properties, Inc.
$
1.40
$
1.38
Add: depreciation and amortization of properties
1.10
1.13
Add: our share of depreciation and amortization of unconsolidated joint ventures
-
.02
Add: impairment loss
.05
-
Add: amortization of deferred leasing costs
.04
.03
Add: our share of amortization of deferred leasing costs of unconsolidated joint ventures
-
-
Add: our share of impairment loss of unconsolidated joint venture property
-
.04
Add: equity in loss from sale of unconsolidated joint venture property
-
.01
Deduct: gain on sale of real estate, net
(.84)
(.80)
Adjustments for non-controlling interests
.02
.01
NAREIT funds from operations per share of common stock (1)
1.77
1.82
Deduct: straight-line rent accruals and amortization of lease intangibles
(.13)
(.13)
Adjust: our share of straight-line rent accruals and amortization of lease intangibles of unconsolidated joint ventures
-
-
Deduct: lease termination fee income
(.01)
-
Deduct: other income and income on settlement of litigation
(.01)
(.01)
Deduct: our share of unconsolidated joint venture lease termination fee income
-
-
Deduct: additional rent from ground lease tenant
-
-
Add: amortization of restricted stock and RSU compensation
.23
.25
Add: amortization and write-off of deferred financing costs
.04
.04
Add: amortization of lease incentives
.01
.01
Add: amortization of mortgage intangible assets
.01
.01
Add: our share of amortization of deferred financing costs of unconsolidated joint venture
-
-
Adjustments for non-controlling interests
-
-
Adjusted funds from operations per share of common stock (1)
$
1.91
$
1.99
(1) The weighted average number of diluted common shares used to compute FFO and AFFO applicable to common stock includes unvested restricted shares that are excluded from the computation of diluted EPS.
The $969,000, or 2.5%, decrease in FFO is due primarily to:
● a $1.5 million increase in real estate operating expenses,
● a $683,000 increase in interest expense,
● a $333,000 decrease in rental income, net, and
● a $264,000 decrease in equity in earnings from our unconsolidated joint ventures due to the inclusion and exclusion, in 2023, of rent income and depreciation expense, respectively, from the Manahawkin Property which was sold in December 2023.
Offsetting the decrease is:
● a $952,000 increase in other income,
● a $434,000 decrease in general and administrative expenses,
● a $283,000 decrease in state tax expense, and
● $250,000 of lease termination fee income.
See “-Comparison of Years Ended December 31, 2024 and 2023” for further information regarding these changes.
The $1.4 million, or 3.4%, decrease in AFFO is due primarily to the factors impacting FFO as described immediately above, other than the (i) decrease in general and administrative expenses and (ii) lease termination fee income.
See “-Comparison of Years Ended December 31, 2024 and 2023” for further information regarding these changes.
Comparison of Years Ended December 31, 2023 and 2022
As we qualify as a smaller reporting company, this comparison is omitted in accordance with Instruction 1 to Item 303(a) of Regulation S-K.
Liquidity and Capital Resources
Our sources of liquidity and capital include cash flow from operations, cash and cash equivalents, borrowings under our credit facility, refinancing existing mortgage loans, obtaining mortgage loans secured by our unencumbered properties, issuance of our equity securities and property sales. In 2024, we obtained approximately (i) $38.2 million of net proceeds from property sales (after giving effect to $19.9 million of mortgage debt repayments) and (ii) $45.0 million of proceeds from mortgage financings (after giving effect to $33.1 million of refinanced amounts). Our available liquidity at February 28, 2025 was approximately $110.1 million, including approximately $10.1 million of cash and cash equivalents (including the credit facility’s required $3.0 million average deposit maintenance balance) and, subject to borrowing base requirements, up to $100.0 million available under our credit facility.
Liquidity and Financing
We expect to meet our short-term (i.e., one year or less) and long-term (i) operating cash requirements (including debt service and anticipated dividend payments) principally from cash flow from operations, our available cash and cash equivalents, proceeds from and, to the extent permitted and needed, our credit facility and (ii) investing and financing cash requirements (including an estimated aggregate of $3.5 million of capital expenditures) from the foregoing, as well as property financings, property sales and sales of our common stock.
The following table sets forth, as of December 31, 2024, information with respect to our mortgage debt that is payable from January 2025 through December 31, 2027:
(Dollars in thousands)
Total
Amortization payments
$
11,084
$
11,038
$
9,999
$
32,121
Principal due at maturity
22,458
(1)
18,461
38,525
79,444
Total
$
33,542
$
29,499
$
48,524
$
111,565
(1)Of such sum, $18,737 matures during the six months ending June 30, 2025. We anticipate that we will extend $5,790 and payoff $12,947 of the principal payments that mature during the six months ending June 30, 2025.
We intend to make debt amortization payments from operating cash flow and, though no assurance can be given that we will be successful in this regard, generally intend to refinance, extend or payoff the mortgage loans which mature in 2025 through 2027. We intend to repay the amounts not refinanced or extended from our existing funds and sources of funds, including our available cash, proceeds from the sale of our common stock and our credit facility (to the extent available).
We continually seek to refinance existing mortgage loans on terms we deem acceptable to generate additional liquidity. Additionally, in the normal course of our business, we sell properties when we determine that it is in our best interests, which also generates additional liquidity. Further, although we have done so infrequently and primarily in the context of a tenant default at a property for which we have not found a replacement tenant, if we believe we have negative equity in a property subject to a non-recourse mortgage loan, we may convey such property to the mortgagee to terminate our mortgage obligations, including payment of interest, principal and real estate taxes, with respect to such property.
Typically, we utilize funds from our credit facility to acquire a property and, thereafter secure long-term, fixed rate mortgage debt on such property. We apply the proceeds from the mortgage loan to repay borrowings under the credit facility, thus providing us with the ability to re-borrow under the credit facility for the acquisition of additional properties.
Material Contractual Obligations
The following sets forth our material contractual obligations as of December 31, 2024:
Payment due by period
Less than
More than
(Dollars in thousands)
1 Year
1 - 3 Years
4 - 5 Years
5 Years
Total
Mortgages payable-interest and amortization
$
29,663
$
54,163
$
42,511
$
62,397
$
188,734
Mortgages payable-balances due at maturity
22,458
56,986
109,541
159,172
348,157
Credit facility (1)
-
-
-
-
-
Purchase obligations (2)
4,367
8,738
8,805
22,145
Total
$
56,488
$
119,887
$
160,857
$
221,804
$
559,036
(1) At December 31, 2024 and February 28, 2025, there was no balance outstanding on the credit facility. We may borrow up to $100,000 pursuant to such facility, subject to compliance with borrowing base requirements. At December 31, 2024 and February 28, 2025, after giving effect to such borrowing base requirements, $100,000 was available to be borrowed. The facility expires December 31, 2026. See “-Credit Facility”.
(2) Assumes that approximately $3,740 will be payable annually during the next five years pursuant to the compensation and services agreement. Excludes (i) approximately $3,500 of capital expenditures to be incurred in the ordinary course of business in connection with tenant improvements, (ii) amounts required to acquire properties, (iii) the potential funding in 2025 for capital expenditures and operating cash flow shortfalls at The Vue, which amount, if any, has not been definitively determined and (iv) subject to Board approval, $193,000 of dividend payments anticipated to be paid through December 31, 2029 (assuming no changes in the number of shares common stock outstanding and the dividend rate from December 31, 2024).
As of December 31, 2024, we had $425.0 million of mortgage debt outstanding, all of which is non-recourse (subject to standard carve-outs). We expect that mortgage interest and amortization payments (excluding repayments of principal at maturity) of approximately $83.8 million due through 2027 will be paid primarily from cash generated from our operations. We anticipate that principal balances due at maturity through 2027 of $79.4 million will be paid primarily from cash and cash equivalents and mortgage financings and refinancings. If we are unsuccessful in refinancing our existing indebtedness or financing our unencumbered properties, our cash flow, funds available under our credit facility and available cash, if any, may not be sufficient to repay all debt obligations when payments become due, and we may need to issue additional equity, obtain long or short-term debt, or dispose of properties on unfavorable terms.
Credit Facility
Our credit facility provides that subject to borrowing base requirements, we can borrow up to $100.0 million for the acquisition of commercial real estate, repayment of mortgage debt, and renovation and operating expense purposes; provided, that if used for renovation and operating expense purposes, the amount outstanding for such purposes will not exceed the lesser of $40.0 million and 40% of the borrowing base. See “-Liquidity and Capital Resources”. The facility matures December 31, 2026 and bears interest equal to 30-day SOFR plus the applicable margin. The applicable margin ranges from 175 basis points if our ratio of total debt to total value (as calculated pursuant to the facility) is equal to or less than 50%, increasing to a maximum of 275 basis points if such ratio is greater than 60%. The applicable margin was 175 basis points for each of 2024 and 2023. There is an unused facility fee of 0.25% per annum on the difference between the outstanding loan balance and $100.0 million. The credit facility requires the maintenance of $3.0 million in average deposit balances. As of February 28, 2025, the rate on the facility was 6.06%.
The terms of our credit facility include certain restrictions and covenants which may limit, among other things, the incurrence of liens, and which require compliance with financial ratios relating to, among other things, the minimum amount of tangible net worth, the minimum amount of debt service coverage, the minimum amount of fixed charge coverage, the maximum amount of debt to value, the minimum level of net income, certain investment limitations and the minimum value of unencumbered properties and the number of such properties. Net proceeds received from the sale, financing or refinancing of properties are generally required to be used to repay amounts outstanding under our credit facility.
Inflation
We are exposed to inflation risk as income from long-term leases is the primary source of our cash flows from operations. Approximately 72% of our leases contain provisions intended to mitigate the impact of inflation. These provisions generally increase rental rates during the terms of the leases either at fixed rates or indexed escalations (based on the Consumer Price Index or other measures). In addition, many of our leases require the tenant to pay, or reimburse us for our payment of, all or a majority of the property’s operating expenses, including real estate taxes, utilities, insurance and building repairs, which may also mitigate our risks associated with rising costs. However, these rent escalation provisions may not adequately offset the effects of inflation.
Inflation may also affect the overall cost of our unhedged debt (i.e., primarily debt incurred pursuant to our credit facility) and affects the mortgage debt we may incur in the future. (The interest rate risk associated with substantially all of our current mortgage debt is either mitigated through long-term fixed interest rate loans and interest rate hedges). Increasing interest rates on acquisition mortgage debt limits the acquisition opportunities we can pursue and reduces the prices at which we sell our properties.
Distribution Policy
We have elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended. Accordingly, to qualify as a REIT, we must, among other things, meet a number of organizational and operational requirements, including a requirement that we distribute currently at least 90% of our ordinary taxable income to our stockholders. It is our current intention to comply with these requirements and maintain our REIT status. As a REIT, we generally will not be subject to corporate federal, state or local income taxes on taxable income we distribute currently (in accordance with the Internal Revenue Code and applicable regulations) to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal, state and local income taxes at regular corporate rates and may not be able to qualify as a REIT for four subsequent tax years. Although we qualify for federal taxation as a REIT, we are subject to certain state and local taxes on our income and to federal income taxes on our undistributed taxable income (i.e., taxable income not distributed in the amounts and in the time frames prescribed by the Internal Revenue Code and applicable regulations thereunder) and are subject to Federal excise taxes on our undistributed taxable income.
It is our current intention to pay to our stockholders within the time periods prescribed by the Internal Revenue Code no less than 90%, and, if possible, 100% of our annual taxable income, including taxable gains from the sale of real estate. It will continue to be our policy to make sufficient distributions to stockholders in order for us to maintain our REIT status under the Internal Revenue Code.
Our board of directors will continue to evaluate, on a quarterly basis, the amount and nature (i.e., cash, stock or a combination of the foregoing) of dividend payments based on its assessment of, among other things, our short and long-term cash and liquidity requirements, prospects, debt maturities, maintenance of our REIT status, projections of our REIT taxable income, net income, funds from operations and adjusted funds from operations.
Critical Accounting Estimates
Our discussion and analysis of financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. On an ongoing basis, we reconsider and evaluate our estimates and assumptions.
We base our estimates on historical experience, current trends and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could materially differ from any of our estimates under different assumptions or conditions. Our significant accounting policies are discussed in Note 2 of our consolidated financial statements in this report. We believe the accounting estimates listed below are the most critical to aid in fully understanding and evaluating our reported financial results, and they require our most difficult, subjective or complex judgments, resulting from the need to make estimates about the effect of matters that are inherently uncertain.
Revenue Recognition
Our main source of revenue is rental income from our tenants. Rental income primarily includes: (i) base rents that our tenants pay in accordance with the terms of their respective leases reported on a straight-line basis over the non-cancellable term of each lease and (ii) reimbursements by tenants of certain real estate operating expenses. Since many of our leases provide for rental increases at specified intervals, straight-line basis accounting requires us to record as an asset and include in revenues, unbilled rent receivables which we will only receive if the tenant makes all rent payments required through the expiration of the term of the lease. Accordingly, our management must determine, in its judgment, that the unbilled rent receivable applicable to each specific tenant is collectable. We review unbilled rent receivables on a quarterly basis and take into consideration the tenant’s payment history and the financial condition of the tenant. In the event that the collectability of an unbilled rent receivable is unlikely, we are required to write-off the receivable, which has an adverse effect on net income for the year in which the direct write-off is taken, and will decrease total assets and stockholders’ equity.
Purchase Accounting for Acquisition of Real Estate
The fair value of real estate acquired is allocated to acquired tangible assets (which includes land, building and building improvements) and identified intangible assets and liabilities (which include the value of above, below and at-market leases, origination costs associated with in-place leases and above and below-market mortgages assumed) based in each case on their relative fair values. The fair value of the tangible assets of an acquired property is determined by valuing the property as if it were vacant, and the “as-if-vacant” value is then allocated to land, building and building improvements based on our determination of the relative fair values of these assets. We assess the fair value of the lease intangibles and assumed mortgages based on estimated cash flow projections that utilize appropriate discount rates and available market information. The fair values associated with below-market rental renewal options are determined based on our experience and the relevant facts and circumstances that existed at the time of the acquisitions. The portion of the values of the leases associated with below-market renewal options that we deem reasonably certain to be exercised by the tenant are amortized to rental income over the respective renewal periods. The allocation made by us may have a positive or negative effect on net income and may have an effect on the assets and liabilities on the balance sheet.
Carrying Value of Real Estate Portfolio
We review our real estate portfolio on a quarterly basis to ascertain if there are any indicators of impairment to the value of any of our real estate assets, including deferred costs and intangibles, to determine if there is any need for an impairment charge. In reviewing the portfolio, we examine the type of asset, the current financial statements or other available financial information of the tenant, the economic situation in the area in which the asset is located, the economic situation in the industry in which the tenant is involved and the timeliness of the payments made by the tenant under its lease, as well as any current correspondence that may have been had with the tenant, including property inspection reports. For each real estate asset owned for which indicators of impairment exist, we perform a recoverability test by comparing the sum of the estimated undiscounted future cash flows attributable to the asset to its carrying amount. Management’s assumptions and estimates include projected rental rates during the holding period and property capitalization rates in order to estimate undiscounted future cash flows. If the undiscounted cash flows are less than the asset’s carrying amount, an impairment loss is recorded to the extent that the estimated fair value is less than the asset’s carrying amount. The estimated fair value is determined using a discounted cash flow model of the expected future cash flows through the useful life of the property. Real estate assets that are expected to be disposed of are valued at the lower of carrying amount or fair value less costs to sell on an individual asset basis. We generally do not obtain any independent appraisals in determining value but rely on our own analysis and valuations. Any impairment charge taken with respect to any part of our real estate portfolio will reduce our net income and reduce assets and stockholders’ equity to the extent of the amount of any impairment charge, but it will not affect our cash flow or our distributions until such time as we dispose of the property.
Equity-Based Compensation
We grant shares of restricted stock and restricted stock units (“RSUs”) to eligible plan participants, subject to the recipient’s continued service over a specified period and, with respect to the RSUs, the satisfaction of specified conditions over a specified period. The RSUs vest based upon satisfaction of specified metrics with respect to the (i) average of our annual total stockholder return (“TSR Awards”) and/or (ii) average annual return of capital (“ROC Awards”), in each case as calculated pursuant to the applicable award agreement. We account for the restricted stock awards and RSUs in accordance with ASC 718, Compensation - Stock Compensation, which requires that such compensation be recognized in the financial statements based on its estimated grant date fair value. The value of such awards is recognized as compensation expense in general and administrative expenses in the accompanying consolidated statements of operations over the applicable service periods. Grant date fair value is determined with respect to the (i) restricted stock awards, by the closing stock price on the date of grant, (ii) TSR Awards, by using a Monte Carlo simulation relying upon various assumptions and (iii) ROC Awards, by the closing stock price on the date of grant, subject to quarterly adjustment based upon management’s projections as to the achievability of the specified metrics related to the ROC Awards (the “ROC Metrics”). There is substantial subjectivity in management’s projections as to the achievability of the ROC Metrics and changes in such projections will cause fluctuations in our results of operations. See Note 11 to our consolidated financial statements.

---

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
Our primary market risk exposure is the effect of changes in interest rates on the interest cost of draws on our revolving variable rate credit facility and the effect of changes in the fair value of our interest rate swap agreements. Interest rates are highly sensitive to many factors, including governmental monetary and tax policies, domestic and international economic and political considerations and other factors beyond our control.
We use interest rate swaps to limit interest rate risk on substantially all variable rate mortgages. These swaps are used for hedging purposes-not for speculation. We do not enter into interest rate swaps for trading purposes. At December 31, 2024, we had no liability in the event of the early termination of our swaps.
At December 31, 2024, we had eight interest rate swap agreements outstanding with an aggregate $13.9 million notional amount. The fair market value of the interest rate swaps is dependent upon existing market interest rates and swap spreads, which change over time. As of December 31, 2024, if there had been an increase of 100 basis points in forward interest rates, the fair market value of the interest rate swaps and the net unrealized gain on derivative instruments would have increased by $85,000. If there were a decrease of 100 basis points in forward interest rates, the fair market value of the interest rate swaps and the net unrealized gain on derivative instruments would have decreased by $86,000. These changes would not have any impact on our net income or cash.
The fair market value of our long-term debt is estimated based on discounting future cash flows at interest rates that our management believes reflect the risks associated with long-term debt of similar risk and duration.
The following table sets forth our debt obligations by scheduled principal cash flow payments and maturity date, weighted average interest rates and estimated fair market value at December 31, 2024:
For the Year Ended December 31,
Fair
Market
(Dollars in thousands)
Thereafter
Total
Value
Fixed rate:
Long-term debt
$
33,542
$
29,499
$
48,524
$
39,511
$
86,670
$
187,232
$
424,978
$
398,934
Weighted average interest rate
4.22
%
4.07
%
3.80
%
4.60
%
4.41
%
4.95
%
4.56
%
6.28
%
Variable rate:
Long-term debt (1)(2)
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
(1) As of December 31, 2024, there was no balance outstanding on our credit facility. Our credit facility matures on December 31, 2026 and bears interest equal to 30-day SOFR plus the applicable margin. The applicable margin varies based on the ratio of total debt to total value. See “Item 7. Management’s Discussion and Analysis of Financial Conditions and Results of Operations-Liquidity and Capital Resources-Credit Facility.”
(2) Excludes $7.3 million of variable rate mortgage debt.

---

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Item 8. Financial Statements and Supplementary Data.
This information appears in Item 15(a) of this Annual Report on Form 10-K and is incorporated into this Item 8 by reference thereto.

---

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
Not applicable.

---

ITEM 9A. CONTROLS AND PROCEDURES
Item 9A. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
A review and evaluation was performed by our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of the end of the period covered by this Annual Report on Form 10-K. Based on that review and evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures, as designed and implemented as of December 31, 2024, were effective.
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, a company’s principal executive and principal financial officers and effected by a company’s board, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP and includes those policies and procedures that:
● pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of a company;
● provide reasonable assurance that transactions are recorded as necessary to permit the preparation of financial statements in accordance with GAAP, and that receipts and expenditures of a company are being made only in accordance with authorizations of management and the board of directors of a company; and
● provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use or disposition of a company’s assets that could have a material effect on the financial transactions.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2024. In making this assessment, our management used criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013).
Based on its assessment, our management concluded that, as of December 31, 2024, our internal control over financial reporting was effective based on those criteria.
Changes in Internal Controls over Financial Reporting
There have been no changes in our internal controls over financial reporting, as defined in in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act, that occurred during the three months ended December 31, 2024 that materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

---

ITEM 9B. OTHER INFORMATION
Item 9B. Other Information.
None of our officers or directors had any contract, instruction, or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement” in effect at any time during the three months ended December 31, 2024.
On March 5, 2025, our board of directors adopted, subject to stockholder approval, our 2025 Incentive Plan pursuant to which up to 750,000 shares of the Company’s common stock (and certain cash payments pursuant to dividend equivalent rights) may be issued to our employees, officers, directors and certain others pursuant to grants of, among other things, stock options, restricted stock, RSUs, performance share awards and any one or more of the foregoing.

---

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Item 10. Directors, Executive Officers and Corporate Governance.
Apart from certain information concerning our executive officers which is set forth in Part I of this Annual Report, additional information required by this Item 10 shall be included in our proxy statement for our 2025 annual meeting of stockholders, to be filed with the SEC not later than April 30, 2025, and is incorporated herein by reference.

---

ITEM 11. EXECUTIVE COMPENSATION
Item 11. Executive Compensation.
The information required by this Item 11 will be included in our proxy statement for our 2025 annual meeting of stockholders, to be filed with the SEC not later than April 30, 2025, and is incorporated herein by reference.

---

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
Apart from the equity compensation plan information required by Item 201(d) of Regulation S-K which is set forth below, the information required by this Item 12 will be included in our proxy statement for our 2025 annual meeting of stockholders, to be filed with the SEC not later than April 30, 2025 and is incorporated herein by reference.
Equity Compensation Plan Information
The following table provides information as of December 31, 2024 about shares of our common stock that may be issued upon the exercise of options, warrants and rights under our 2022 Incentive Plan (the “2022 Plan”).
Number of
securities
remaining available
Number of
for future issuance
securities
Weighted average
under equity
to be issued
exercise price
compensation
upon exercise
of outstanding
plans (excluding
of outstanding
options,
securities
options, warrants
warrants
reflected in
Plan Category
and rights(1)
and rights
column(a))(2)
(a)
(b)
(c)
Equity compensation plans approved by security holders
256,740
-
189,245
Equity compensation plans not approved by security holders
-
-
-
Total
256,740
-
189,245
(1) Includes up to 83,240 shares, 85,250 shares and 88,250 shares of common stock issuable pursuant to RSUs that vest as of June 30, 2025, 2026 and 2027, respectively, if and to the extent specified performance (i.e., average annual return on capital) and/or market (i.e., average annual total stockholder return) conditions are satisfied by such vesting dates. Excludes shares of restricted stock issued pursuant to the 2019 Incentive Plan and the 2022 Incentive Plan as such shares, although subject to forfeiture, are outstanding. See Note 11 to our consolidated financial statements.
(2) Gives effect to outstanding restricted stock other than the 154,390 shares of restricted stock granted on January 14, 2025 pursuant to the 2022 Plan.

---

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Item 13. Certain Relationships and Related Transactions, and Director Independence.
The information required by this Item 13 will be included in our proxy statement for our 2025 annual meeting of stockholders, to be filed with the SEC not later than April 30, 2025 and is incorporated herein by reference.

---

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Item 14. Principal Accountant Fees and Services.
The information required by this Item 14 will be included in our proxy statement for our 2025 annual meeting of stockholders, to be filed with the SEC not later than April 30, 2025 and is incorporated herein by reference.
PART IV

---

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Item 15. Exhibits and Financial Statement Schedules.
(a) Documents filed as part of this Report:
(1) The following financial statements of the Company are included in this Annual Report on Form 10-K:
-Report of Independent Registered Public Accounting Firm (PCAOB ID 00042)
through
-Statements:
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Comprehensive Income
Consolidated Statements of Changes in Equity
Consolidated Statements of Cash Flows
through
Notes to Consolidated Financial Statements
through
(2) Financial Statement Schedules:
-Schedule III-Real Estate and Accumulated Depreciation
through
All other schedules are omitted because they are not applicable or the required information is shown in the consolidated financial statements or the notes thereto.
(b) Exhibits:
In reviewing the agreements included as exhibits to this Annual Report on Form10-K, please remember they are included to provide you with information regarding their terms and are not intended to provide any other factual or disclosure information about us or the other parties to the agreements. Certain agreements contain representations and warranties by each of the parties to the applicable agreement. These representations and warranties have been made solely for the benefit of the other parties to the applicable agreement and:
• should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;
• have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
• may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and
• were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments. Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any other time.
Exhibit
No. Title of Exhibit
1.1
Equity Distribution Agreement, dated September 21, 2023 by and between One Liberty Properties, Inc. (“OLP”) and B. Riley FBR, Inc. (“Riley”) (incorporated by reference to Exhibit 1.1 to our Current Report on Form 8-K filed on September 21, 2023).
3.1
Articles of Amendment and Restatement of OLP (incorporated by reference to Exhibit 3.1 to our Annual Report on Form 10-K filed on March 12, 2021).
3.2
Amended and Restated By-Laws of OLP effective as of December 7, 2022 (incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K filed on December 7, 2022).
4.1
Form of Common Stock Certificate (incorporated by reference to Exhibit 4.1 to our Registration Statement on Form S-2, Registration No. 333-86850, filed on April 24, 2002 and declared effective on May 24, 2002).
4.2*
OLP Amended and Restated 2019 Incentive Plan (incorporated by reference to Exhibit 4.3 to our Current Report on Form 8-K filed June 14, 2023).
4.3*
OLP 2022 Incentive Plan (incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed June 9, 2022).
4.4
Description of Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to Exhibit 4.5 to our Annual Report on Form 10-K filed on March 12, 2021).
10.1
Third Amended and Restated Loan Agreement dated as of November 9, 2016, between VNB New York, LLC, People’s United Bank, Bank Leumi USA and Manufacturers and Traders Trust Company, as lenders, and OLP (the “Loan Agreement”) (incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed November 10, 2016).
10.2
First Amendment to Loan Agreement dated July 1, 2019 (incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q filed on August 7, 2019).
10.3
Second Amendment to Loan Agreement dated as of July 8, 2020 (incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on July 14, 2020).
10.4
Third Amendment to Loan Agreement dated as of March 3, 2021 (incorporated by reference to Exhibit 10.4 to our Annual Report on Form 10-K filed on March 12, 2021).
10.5
Fourth Amendment to Loan Agreement dated as of November 8, 2022 (incorporated by reference to Exhibit 10.1 our Current Report on Form 8-K filed on November 9, 2022).
10.6*
Compensation and Services Agreement effective as of January 1, 2007 between OLP and Majestic Property Management Corp. (incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on March 14, 2007).
10.7*
First Amendment to Compensation and Services Agreement effective as of April 1, 2012 between OLP and Majestic Property Management Corp. (incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q filed on May 9, 2012).
10.8*
Form of Restricted Stock Award Agreement for awards granted in 2020 and 2021 pursuant to the 2019 Incentive Plan (incorporated by reference to Exhibit 10.11 to our Annual Report on Form 10-K filed on March 16, 2020).
10.9*
Form of Performance Award Agreement for grants in 2021 pursuant to the 2019 Incentive Plan (incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q filed on November 5, 2021).
10.10*
Form of Performance Award Agreement for grants in 2022 pursuant to the 2022 Incentive Plan (incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q filed on August 4, 2022).
10.11*
Form of Restricted Stock Award Agreement for awards granted in 2023 pursuant to the 2022 Incentive Plan (incorporated by reference to Exhibit 10.16 to our Annual Report on Form 10-K filed on March 14, 2023).
10.12*
Form of Performance Award Agreement for grants in 2023 pursuant to the 2022 Incentive Plan (incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q filed on August 4, 2023).
10.13*
Form of Performance Award Agreement for grants in 2024 pursuant to the 2022 Incentive Plan (incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q filed on August 7, 2024).
10.14*
Form of Restricted Stock Award Agreement for awards granted in 2024 pursuant to the 2022 Incentive Plan (incorporated by reference to Exhibit 10.14 to our Annual Report on Form 10-K filed on March 6, 2024).
10.15*
Form of Restricted Stock Award Agreement for awards granted in 2025 pursuant to the 2022 Incentive Plan.
19.1
Insider Trading Policy dated as of December 12, 2024.
21.1
Subsidiaries of the Registrant
23.1
Consent of Ernst & Young LLP
31.1
Certification of President and Chief Executive Officer
31.2
Certification of Senior Vice President and Chief Financial Officer
32.1
Certification of President and Chief Executive Officer
32.2
Certification of Senior Vice President and Chief Financial Officer
97.1
Registrant’s Clawback Policy effective October 2, 2023 (incorporated by reference to Exhibit 97.1 to our Annual Report on Form 10-K filed on March 6, 2024).
The following financial statements, notes and schedule from the One Liberty Properties, Inc. Annual Report on Form 10-K for the year ended December 31, 2024 filed on March 6, 2025 formatted in Inline XBRL: (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Income; (iii) Consolidated Statements of Comprehensive Income; (iv) Consolidated Statements of Changes in Equity; (v) Consolidated Statements of Cash Flows; (vi) Notes to the Consolidated Financial Statements; and (vii) Schedule III - Consolidated Real Estate and Accumulated Depreciation.
Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document and included in Exhibit 101).
*
Indicates a management contract or compensatory plan or arrangement.
The file number for all the exhibits incorporated by reference is 001- 09279 other than exhibit 4.1 whose file number is 333-86850.