MANAGEMENT AGREEMENTS	12 Months Ended
Jun. 30, 2025
Management Agreements
MANAGEMENT AGREEMENTS	NOTE 11 – MANAGEMENT AGREEMENTS Hotel Management Operating entered into a hotel management agreement (“HMA”) with Aimbridge Hospitality (“Aimbridge”) to manage the Hotel, along with its five-level parking garage, with an effective date of February 3, 2017. The term of the management agreement is for an initial period of ten years commencing on February 3, 2017 and automatically renews for successive one (1) year periods, not to exceed five years in the aggregate, subject to certain conditions. Under the terms of the HMA, base management fee (“Basic Fee”) payable to Aimbridge equals one and seven-tenths percent (1.70%) of total Hotel revenue. In addition to the Basic Fee, Aimbridge may earn an annual incentive fee for each fiscal year equal to ten percent (10%) of the amount by which Gross Operating Profit (“GOP”, as defined in the HMA) in the current fiscal year exceeds the previous fiscal year’s GOP. For the fiscal years ended June 30, 2025 and 2024, hotel management fees were $783,000 and $706,000, respectively with incentive fees of $0, for both years, offset by key money amortization of $250,000 for both years that is included in Hotel operating expenses in the consolidated statements of operations. Following discussions with Aimbridge regarding the impact of the COVID-19 pandemic on incentive fee eligibility, the parties agreed that no incentive fees were payable for fiscal years 2019 through 2023. Specifically, Aimbridge agreed to waive $1,030,134 in previously recorded incentive fees, and both parties established a performance threshold for future incentive fee eligibility of $15,257,301 in earnings before interest, taxes, depreciation, and amortization (“EBITDA”) representing the EBITDA in 2017 when Aimbridge began managing the Hotel. As a result, Operating recorded a reduction in Hotel operating expenses of $1,030,134 for the year ended June 30, 2025. Future incentive fees, if any, will be recognized when earned in accordance with the HMA. See also Note 9 – Other Financing Transactions for information of the key money arrangement and related amortization. Under the HMA, Aimbridge, through Kearny Street Parking, LLC, an indirect wholly owned subsidiary, manages the parking garage operations. InterGroup Real Estate Portfolio Management In contrast to the Hotel’s third-party HMA, InterGroup’s multifamily and commercial real estate portfolio is managed in-house. Property-level operations, leasing, maintenance, and capital planning are overseen by the Company personnel rather than an external property manager. This structure provides direct owner oversight and avoids third-party property management and asset management fees that would otherwise be incurred; related payroll and benefits are recorded within real estate operating expenses. With this approach, management has experienced enhanced responsiveness and cost control which are reflected in the consolidated operating statements.

MANAGEMENT AGREEMENTS

12 Months Ended

Jun. 30, 2025

NOTE 11 – MANAGEMENT AGREEMENTS

Hotel Management

Operating entered into a hotel management agreement (“HMA”) with Aimbridge Hospitality (“Aimbridge”) to manage the Hotel, along with its five-level parking garage, with an effective date of February 3, 2017. The term of the management agreement is for an initial period of ten years commencing on February 3, 2017 and automatically renews for successive one (1) year periods, not to exceed five years in the aggregate, subject to certain conditions. Under the terms of the HMA, base management fee (“Basic Fee”) payable to Aimbridge equals one and seven-tenths percent (1.70%) of total Hotel revenue. In addition to the Basic Fee, Aimbridge may earn an annual incentive fee for each fiscal year equal to ten percent (10%) of the amount by which Gross Operating Profit (“GOP”, as defined in the HMA) in the current fiscal year exceeds the previous fiscal year’s GOP.

For the fiscal years ended June 30, 2025 and 2024, hotel management fees were $783,000 and $706,000, respectively with incentive fees of $0, for both years, offset by key money amortization of $250,000 for both years that is included in Hotel operating expenses in the consolidated statements of operations. Following discussions with Aimbridge regarding the impact of the COVID-19 pandemic on incentive fee eligibility, the parties agreed that no incentive fees were payable for fiscal years 2019 through 2023. Specifically, Aimbridge agreed to waive $1,030,134 in previously recorded incentive fees, and both parties established a performance threshold for future incentive fee eligibility of $15,257,301 in earnings before interest, taxes, depreciation, and amortization (“EBITDA”) representing the EBITDA in 2017 when Aimbridge began managing the Hotel. As a result, Operating recorded a reduction in Hotel operating expenses of $1,030,134 for the year ended June 30, 2025. Future incentive fees, if any, will be recognized when earned in accordance with the HMA. See also Note 9 – Other Financing Transactions for information of the key money arrangement and related amortization. Under the HMA, Aimbridge, through Kearny Street Parking, LLC, an indirect wholly owned subsidiary, manages the parking garage operations.

InterGroup Real Estate Portfolio Management

In contrast to the Hotel’s third-party HMA, InterGroup’s multifamily and commercial real estate portfolio is managed in-house. Property-level operations, leasing, maintenance, and capital planning are overseen by the Company personnel rather than an external property manager. This structure provides direct owner oversight and avoids third-party property management and asset management fees that would otherwise be incurred; related payroll and benefits are recorded within real estate operating expenses. With this approach, management has experienced enhanced responsiveness and cost control which are reflected in the consolidated operating statements.