INVESTMENTS IN REAL ESTATE

6 Months Ended

Jun. 30, 2025

3. INVESTMENTS IN REAL ESTATE

Investments in real estate consist of the following (in thousands):


	June 30, 2025		December 31, 2024
Land	$	175,682	$	175,682
Land improvements	5,595		5,863
Buildings and improvements	651,269		636,525
Furniture, fixtures, and equipment	12,221		12,844
Tenant improvements	16,038		26,942
Work in progress	28,315		36,929
Investments in real estate	889,120		894,785
Accumulated depreciation	(184,345)		(185,591)
Net investments in real estate	$	704,775	$	709,194

For both the three months ended June 30, 2025 and 2024, the Company recorded depreciation expense of $5.8 million. For both the six months ended June 30, 2025 and 2024, the Company recorded depreciation expense of $11.7 million.

Impairment—The Company performs quarterly impairment review procedures, primarily through continuous monitoring of events and changes in circumstances that could indicate that the carrying value of certain of its investments in real estate may not be recoverable. See Note 2 for a discussion of the Company’s accounting policies regarding impairment of investments in real estate.

During both the three and six months ended June 30, 2025, one office property in Austin, Texas, with a carrying value of $2.1 million, was deemed to be impaired and its carrying value was reduced to an estimated fair value of $1.9 million, resulting in impairment charges of $221,000, which were recorded in the consolidated statement of operations. The Company recorded no impairment charges during the three and six months ended June 30, 2024. See Note 2 for a discussion of the Company’s policies regarding impairment of real estate assets.

See Note 13 for a further discussion regarding these impairment charges during the three and six months ended June 30, 2025.

2025 and 2024 Transactions and Assets Held for Sale—There were no acquisitions or dispositions during the six months ended June 30, 2025 and 2024.