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Note 4 - Real Estate Assets

12 Months Ended

Dec. 31, 2025

4. REAL ESTATE ASSETS

The Company owns a diverse portfolio of real estate assets. The primary types of properties the Company invests in are office, industrial, retail, and triple-net leased model home properties. As of December 31, 2025, the Company owned or had an equity interest in:

•

Eight office buildings and one industrial building (“Office/Industrial Properties”);

•

One retail shopping center (“Retail Property”);

•

80 model home residential properties (“Model Homes” or “Model Home Properties”), leased back on a triple-net basis to homebuilders, which are owned by five affiliated limited partnerships and one wholly-owned corporation, all of which we control. As of December 31, 2025, all of the model homes in Dubose Model Home Investors #202, #203, and #206, LP had been sold.

Previously, the Company reported a portfolio for the year ended December 31, 2024 of:

• Eight office buildings and one industrial building,

• Three retail shopping centers, and

• 78 model homes.

A summary of the properties owned by the Company, including their lease intangibles, as of December 31, 2025 and 2024 is as follows:

	*Date*		*Real estate assets and lease intangibles, net*
Property Name	*Acquired*	*Location*	*December 31, 2025*		*December 31, 2024*
Genesis Plaza (1)	August 2010	San Diego, CA	$	7,274,600	$	7,363,571
Dakota Center (2)	May 2011	Fargo, ND		4,861,267		8,154,951
Grand Pacific Center (3)	March 2014	Bismarck, ND		8,082,202		8,413,926
Arapahoe Center	December 2014	Centennial, CO		8,874,198		9,298,534
Union Town Center (3)	December 2014	Colorado Springs, CO		—		8,922,943
West Fargo Industrial	August 2015	Fargo, ND		6,404,774		6,599,953
300 N.P.	August 2015	Fargo, ND		1,949,040		1,963,000
Research Parkway (3)	August 2015	Colorado Springs, CO		—		2,220,284
One Park Center	August 2015	Westminster, CO		5,740,065		5,580,950
Shea Center II (4)	December 2015	Highlands Ranch, CO		16,249,498		18,820,370
Mandolin (5)	August 2021	Houston, TX		4,508,851		4,600,562
Baltimore	December 2021	Baltimore, MD		8,016,747		8,241,456
Commercial properties				71,961,242		90,180,500
Model Home properties (6)	2020 - 2025			36,688,462		37,416,000
Total real estate assets and lease intangibles, net			$	108,649,704	$	127,596,500

(1)	Genesis Plaza is owned by two tenants-in-common, NetREIT Genesis and NetREIT Genessis II, each of which own 57% and 43%, respectively, and we beneficially own an aggregate of 92.0%, based on our ownership of each entity. We have 100% ownership of NetREIT Genesis and 81.5% ownership of NetREIT Genesis II, and we have control of both entities. During July 2024, the Company completed a minority ownership conversion option as result of a death in a noncontrolling trust within NetREIT Genesis II. The Company issued the trust 86,232 shares of SQFT Series A Common Stock in exchange for their 36.4% ownership in NetREIT Genesis II, as per the original exchange agreement.
(2)	The non-recourse loan on the Dakota Center property matured on July 6, 2024. During December 2024, the lender agreed to the broker the Company would use to sell the property to settle the non-recourse debt. At December 31, 2025, the property was included in the real estate assets held for sale, net on the consolidated balance sheet. During July 2025, the lender approved a purchase offer from a third party for $5,125,000. In connection with the approved sale, we have impaired the property’s book value and recorded an impairment charge of approximately $3.5 million for the year ended December 31, 2025. The sale was completed on January 14, 2026.
(3)	During February 2025, Union Town Center and Research Parkway were sold to a single buyer for a combined total of approximately $15.9 million, net of selling costs, and recognized a net gain of approximately $4.5 million, net of closing costs.
(4)	During the year ended December 31, 2025, the Company impaired Shea Center II for a total of approximately $2.5 million after low property occupancy triggered a cash management event under the terms of the loan agreement. Subsequent to the year ended December 31, 2025, the Company received notice that the Company's failure to repay in full by January 5, 2026 the indebtedness related to the loan agreement governing Shea Center II had triggered a default event. The Company has received notification that the Shea Center II property governed by this agreement will be moved into receivership, which will fulfill its obligation for this non-recourse loan.
(5)	A portion of the proceeds from the sale of Highland Court were used in like-kind exchange transactions pursued under Section 1031 of the Code for the acquisition of our Mandolin property. Mandolin is owned by NetREIT Palm Self-Storage LP, through its wholly owned subsidiary, NetREIT Highland LLC, and the Company is the sole general partner and owns 61.3% of NetREIT Palm Self-Storage LP.
(6)	Includes Model Homes listed as held for sale as of December 31, 2025 and December 31, 2024. During the year ended December 31, 2025, we recorded impairment charges for model homes of approximately $0.3 million, which reflects the estimated sales prices for these specific model homes; for the same period in 2024, we recorded $0.4 million in impairment. The short hold period, less than two years, and the builder changing their model style after we purchased the homes, contributed to the lower-than-expected sales price. As of December 31, 2025, we had model home properties held for sale in Alabama, Arizona, Tennessee, and Texas. As of December 31, 2024, we had model home properties held for sale in Arizona, Florida, and Texas.

For the years ended December 31, 2025 and 2024, depreciation and amortization expense, excluding amortization of deferred leasing cost, totaled approximately $4.4 million and $5.0 million, respectively. As of December 31, 2025 and 2024, construction in progress for tenant and building improvements totaled approximately $1.1 million and $0.4 million, respectively.