10q10k10q10k.net

What changed in Safehold Inc.'s 10-K — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of Safehold Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+244 added−260 removedSource: 10-K (2026-02-12) vs 10-K (2025-02-06)

Top changes in Safehold Inc.'s 2025 10-K

244 paragraphs added · 260 removed · 188 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

36 edited+5 added−21 removed64 unchanged
Biggest changeWe track the UCA in our owned residual portfolio over our basis because we believe it provides relevant information with regard to the three key investment characteristics of our Ground Leases: (1) the safety of our position in a tenant’s capital structure; (2) the quality of the long-term cash flows generated by our portfolio rent that increases over time; and (3) increases and decreases in the Combined Property Value of the portfolio that reverts to us pursuant to such residual rights. 3 Table of Contents We believe that, similar to a loan to value metric, tracking changes in the value of our owned residual portfolio is useful as an indicator of the quality of our cash flows and the safety of our position in a tenant’s capital structure, which, in turn, supports our objective to pay and grow dividends over time.
Biggest changeWe track the UCA in our owned residual portfolio over our basis because we believe it provides relevant information with regard to the three key investment characteristics of our Ground Leases: (1) the safety of our position in a tenant’s capital structure; (2) the quality of the long-term cash flows generated by our portfolio rent that increases over time; and (3) increases and decreases in the Combined Property Value of the portfolio that reverts to us pursuant to such residual rights.
Our structure as a holding company gives us the ability to acquire Ground Leases from owners, particularly estates and high net worth individuals, using GL units or Caret units that may provide the seller with tax advantages, as well as liquidity, portfolio diversification and professional management. ​ We generally intend to target Ground Leases that meet some or all of the following investment criteria: ● Properties of any type that are located in the top 30 metropolitan areas; ● Properties that we believe are well located in markets with high barriers to entry and that have durable cash flow; ● Transaction sizes between $10 million and $500 million or more; ● Average remaining initial lease terms that are typically 30 to 99 years; ● Periodic contractual rent escalators or percentage rent participations; ● Ground Rent Coverage, defined as the ratio of the Property’s NOI to the annualized rental payment due us, of approximately 2.0x to 4.5x.
Our structure as a holding company gives us the ability to acquire Ground Leases from owners, particularly estates and high net worth individuals, using GL units or Caret units that may provide the seller with tax advantages, as well as liquidity, portfolio diversification and professional management. ​ We generally intend to target Ground Leases that meet some or all of the following investment criteria: ● Properties of any type that are located in the top 30 metropolitan areas; ● Properties that we believe are well located in markets with high barriers to entry and that have durable cash flow; ● Transaction sizes between $10 million and $500 million or more; ● Average remaining initial lease terms that are typically 30 to 99 years; ● Periodic contractual rent escalators or percentage rent participations; 5 Table of Contents ● Ground Rent Coverage, defined as the ratio of the Property’s NOI to the annualized rental payment due us, of approximately 2.0x to 4.5x.
These programs include an employee assistance program that offers confidential assessment, counseling and referral services at no cost to the employee. We seek to provide a safe workplace for our employees and have established emergency procedures that address emergency health and safety situations. 8 Table of Contents Additional Information We maintain a website at www.safeholdinc.com .
These programs include an employee assistance program that offers confidential assessment, counseling and referral services at no cost to 7 Table of Contents the employee. We seek to provide a safe workplace for our employees and have established emergency procedures that address emergency health and safety situations. Additional Information We maintain a website at www.safeholdinc.com .
See “SAFE Proposal 2: The SAFE Caret 4 Table of Contents Amendment Proposal” in our Registration Statement on Form S-4, filed with the SEC on December 16, 2022, for more information on the Caret program. ​ During the third quarter of 2018, Old SAFE adopted, and in the second quarter of 2019, its stockholders approved, the Caret Performance Incentive Plan (the “Original Caret Performance Incentive Plan”).
See “SAFE Proposal 2: The SAFE Caret Amendment Proposal” in our Registration Statement on Form S-4, filed with the SEC on December 16, 2022, for more information on the Caret program. ​ During the third quarter of 2018, Old SAFE adopted, and in the second quarter of 2019, its stockholders approved, the Caret Performance Incentive Plan (the “Original Caret Performance Incentive Plan”).
See "Risk Factors – Risks Related to Our Relationship with Star Holdings – “There are various potential conflicts of interest in our relationship with Star Holdings, which could result in decisions that are not in the best interest of our shareholders.” ​ Competition We compete with numerous commercial developers, real estate companies (including other REITs), financial institutions (such as banks and insurance companies) and other investors (such as pension funds, investment funds, private companies and individuals) for investment opportunities and tenants.
See "Risk Factors – Risks Related to Our Relationship with Star Holdings – “There are various potential conflicts of interest in our relationship with Star Holdings, which could result in decisions that are not in the best interest of our shareholders.” ​ 6 Table of Contents Competition We compete with numerous commercial developers, real estate companies (including other REITs), financial institutions (such as banks and insurance companies) and other investors (such as pension funds, investment funds, private companies and individuals) for investment opportunities and tenants.
Property NOI is defined as the trailing twelve month net operating income of 6 Table of Contents the building and improvements being operated at the property without giving effect to any rent paid or payable under our Ground Lease, and for this purpose we use estimates of the stabilized Property NOI if we don’t receive current tenant information and for properties under construction or in transition, in each case based on leasing activity at the property and available market information, including leasing activity at comparable properties in the relevant market; ● Value of approximately 30% to 45% of the Combined Property Value at the commencement of the lease or the acquisition date; and ● First year cash return on asset of between 2.5% and 5.5% and effective yields between 4.5% and 7.5%.
Property NOI is defined as the trailing twelve month net operating income of the building and improvements being operated at the property without giving effect to any rent paid or payable under our Ground Lease, and for this purpose we use estimates of the stabilized Property NOI if we don’t receive current tenant information and for properties under construction or in transition, in each case based on leasing activity at the property and available market information, including leasing activity at comparable properties in the relevant market; ● Value of approximately 30% to 45% of the Combined Property Value at the commencement of the lease or the acquisition date; and ● First year cash return on assets of between 2.5% and 5.5% and effective yields between 4.5% and 7.5%.
As a result, as of December 31, 2024, vested and unvested Caret units beneficially owned by our officers and other employees represent approximately 14.4% of the outstanding Caret units and 11.4% of the authorized Caret units, including 6.1% held directly and indirectly by Jay Sugarman, our Chairman and Chief Executive Officer. ​ In addition to the Caret units awarded or reserved for issuance under our Caret Performance Incentive Plan, we have sold 122,500 Caret units to third-party investors, including affiliates of MSD Partners, that remain outstanding as of December 31, 2024.
As a result, as of December 31, 2025, vested and unvested Caret units beneficially owned by our officers and other employees represent approximately 14.9% of the outstanding Caret units and 11.9% of the authorized Caret units, including 6.1% held directly and indirectly by Jay Sugarman, our Chairman and Chief Executive Officer. ​ In addition to the Caret units awarded or reserved for issuance under our Caret Performance Incentive Plan, we have sold 122,500 Caret units to third-party investors, including affiliates of MSD Partners that remain outstanding as of December 31, 2025.
We intend to capture this market opportunity by utilizing multiple sourcing and origination channels, including manufacturing new Ground Leases with third-party owners and developers of commercial real estate and originating Ground Leases to provide capital for development and 5 Table of Contents redevelopment.
We intend to capture this market opportunity by utilizing multiple sourcing and origination channels, including manufacturing new Ground Leases with third-party owners and developers of commercial real estate and originating Ground Leases to provide capital for development and redevelopment.
The combined value of the land and buildings and improvements thereon subject to a Ground Lease (the "Combined Property Value") typically significantly exceeds the Ground Lease landlord’s investment in the Ground Lease; therefore, even if the landlord takes over the property following a tenant default or upon expiration of the Ground Lease, the landlord is reasonably likely to recover substantially all of its Ground Lease investment, and possibly amounts in excess of its investment, depending upon prevailing market conditions.
The combined value of the land and buildings and improvements thereon subject to a Ground Lease (the "Combined Property Value") typically significantly exceeds the Ground Lease landlord’s investment in the Ground Lease; therefore, even if the landlord takes over the property following a tenant default or upon expiration of the Ground Lease, the landlord may recover substantially all of its Ground Lease investment, and possibly amounts in excess of its investment, depending upon prevailing market conditions.
Under the Original Caret Performance Incentive Plan, 1,500,000 Caret units were reserved for grants of performance-based awards to Original Caret Performance Incentive Plan participants, including certain executives of the Company, or its affiliates, directors of Old SAFE and service providers of Old SAFE.
Under the Original Caret Performance Incentive Plan, 1,500,000 Caret units were reserved for grants of performance-based awards to Original Caret 3 Table of Contents Performance Incentive Plan participants, including certain executives of the Company, or its affiliates, directors of Old SAFE and service providers of Old SAFE.
This competition may result in higher costs for 7 Table of Contents properties, lower returns and impact our ability to grow. Some of these competitors have greater financial and other resources and access to more attractive capital than we do.
This competition may result in higher costs for properties, lower returns and impact our ability to grow. Some of these competitors have greater financial and other resources and access to more attractive capital than we do.
In connection with the Merger, each Award Agreement (as defined in the Original Caret Performance Incentive Plan) related to outstanding Caret unit awards was assigned to Portfolio Holdings, and Old SAFE amended and restated the Original Caret Performance Incentive Plan (the “Caret Performance Incentive Plan”).
In connection with the Merger (refer to Merger Transaction below), each Award Agreement (as defined in the Original Caret Performance Incentive Plan) related to outstanding Caret unit awards was assigned to Portfolio Holdings, and Old SAFE amended and restated the Original Caret Performance Incentive Plan (the “Caret Performance Incentive Plan”).
Ground Leases typically provide that at the end of the lease term or upon tenant default and the termination of the Ground Lease upon such default, the land, 2 Table of Contents building and all improvements revert to the landlord.
Ground Leases typically provide that at the end of the lease term or upon tenant default and the termination of the Ground Lease upon such default, the land, building and all improvements revert to the landlord.
As of December 31, 2024, the Company had 74 employees. The Company believes it has good relationships with its employees. Substantially all of our employees are full time employees and they are not represented by any collective bargaining agreements.
As of December 31, 2025, the Company had 72 employees. The Company believes it has good relationships with its employees. Substantially all of our employees are full-time employees and they are not represented by any collective bargaining agreements.
As we have transitioned the focus of our business to growing our Ground Lease platform, we have sought to recruit new talent and provide training to existing employees to support our business strategy. In our recruiting efforts, we generally strive to draw from the largest feasible pool of candidates to consider for roles.
As we focus on our business of growing our Ground Lease platform, we seek to recruit new talent and provide training to existing employees to support our business strategy. In our recruiting efforts, we generally strive to draw from the largest feasible pool of candidates to consider for roles.
Combined Property Value excludes the term loan to Star Holdings, the assets in the Leasehold Loan Fund (refer to Note 7 to the consolidated financial statements), the rest of the assets in the Ground Lease Plus Fund and amounts attributable to noncontrolling interests.
Combined Property Value excludes the term loan to Star Holdings, the assets in the Leasehold Loan Fund (refer to Note 8 to the consolidated financial statements), the assets in the Ground Lease Plus Fund and amounts attributable to noncontrolling interests.
Following the Merger, 76,801 Caret units were awarded to executive officers and other employees under such plan that are subject to cliff vesting on the fourth anniversary of their grant date if our common stock has traded at an average price of $60.00 or more for at least 30 consecutive trading days during that four-year period.
Following the Merger, 76,801 Caret units were awarded to executive officers and other employees under such plan that are subject to cliff vesting on March 31, 2027 if our common stock has traded at an average price of $60.00 or more for at least 30 consecutive trading days during that four-year period.
The table below shows the current estimated UCA as of December 31, 2024 and 2023 ($ in millions): (1) ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2024 December 31, 2023 Combined Property Value (2) ​ $ 15,523 ​ $ 16,001 Ground Lease Cost (2) ​ 6,395 ​ 6,174 Unrealized Capital Appreciation in Our Owned Residual Portfolio ​ 9,128 ​ 9,827 (1) Please review our Current Report on Form 8-K filed on February 5, 2025 for a discussion of the valuation methodology used and important limitations and qualifications of the calculation of UCA.
The table below shows the current estimated UCA in our owned residual portfolio as of December 31, 2025 and 2024 ($ in millions): (1) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2025 ​ ​ ​ December 31, 2024 Combined Property Value (2) ​ $ 15,947 ​ $ 15,523 Ground Lease Cost (2) ​ 6,675 ​ 6,395 Unrealized Capital Appreciation in Our Owned Residual Portfolio ​ 9,272 ​ 9,128 (1) Please review our Current Report on Form 8-K filed on February 11, 2026 for a discussion of the valuation methodology used and important limitations and qualifications of the calculation of UCA.
Ground Lease Cost excludes the term loan to Star Holdings, the assets in the Leasehold Loan Fund, the rest of the assets in the Ground Lease Plus Fund and amounts attributable to noncontrolling interests.
Ground Lease Cost excludes the term loan to Star Holdings, our leasehold loans, the assets in the Leasehold Loan Fund, the assets in the Ground Lease Plus Fund and amounts attributable to noncontrolling interests.
As of December 31, 2024, our gross book value as a percentage of combined property value was 49%. ​ In 2018, Old SAFE established the Caret program (as defined below).
As of December 31, 2025, our gross book value as a percentage of combined property value was 52%. ​ In 2018, Old SAFE (refer to Merger Transaction below) established the Caret program (as defined below).
In April 2024, all of the investors in the February 2022 transaction exercised this right and elected to have their Caret units redeemed at the original purchase price less the amount of distributions previously made on such units. ​ On March 31, 2023, Old SAFE sold 100,000 Caret units to affiliates of MSD Partners for an aggregate purchase price of $20.0 million (refer to Note 1 to the consolidated financial statements) pursuant to a subscription agreement entered into on August 10, 2022 and sold an aggregate of 22,500 Caret units to third-party investors for an aggregate $4.5 million pursuant to a subscription agreement entered into in November 2022. ​ In September 2022, Old SAFE sold a Ground Lease in the Washington, D.C. market for $136.0 million to a third-party purchaser.
In April 2024, all of the investors in the February 2022 transaction exercised this right and elected to have their Caret units redeemed at the original purchase price less the amount of distributions previously made on such units. ​ On March 31, 2023, Old SAFE sold 100,000 Caret units to affiliates of MSD Partners for an aggregate purchase price of $20.0 million pursuant to a subscription agreement entered into on August 10, 2022 and sold an aggregate of 22,500 Caret units to third-party investors for an aggregate $4.5 million pursuant to a subscription agreement entered into in November 2022. ​ Market Opportunity : We believe that there is a significant market opportunity for a dedicated provider of Ground Lease capital like us.
We further believe that Ground Leases generally represent an attractive source of capital for our tenants and may allow them to generate superior returns on their invested equity as compared to utilizing alternative sources of capital.
We further believe that Ground Leases generally represent an attractive source of capital for our tenants and may allow them to generate superior returns on their invested equity as compared to utilizing alternative sources of capital. Additionally, we have created additional channels and products that allow us to build a larger, captive pipeline.
The Caret program is designed to recognize the two distinct components of value in our Ground Lease portfolio by separating them into: ​ ● the “bond component,” which consists of the bond-like income stream we receive from contractual rent payments under our Ground Leases, plus the return of our investment basis in each asset; and ● the “Caret component,” which consists of the UCA above our investment basis in our Ground Leases due to our ownership of the land and improvements at the end of the term of the applicable Ground Lease. ​ Portfolio Holdings’ two classes of limited liability company interests are designed to track these two components: “GL units” are intended to track the bond component and “Caret units” are designed to track the Caret component (the “Caret program”).
The Caret program is designed to recognize the two distinct components of value in our Ground Lease portfolio by separating them into: ​ ● the “bond component,” which consists of the bond-like income stream we receive from contractual rent payments under our Ground Leases, plus the return of our investment basis in each asset; and ● the “Caret component,” which consists of the UCA above our investment basis in our Ground Leases due to our ownership of the land and improvements at the end of the term of the applicable Ground Lease. ​ We conduct all of our business and own all of our properties through Safehold GL Holdings LLC (“Portfolio Holdings”) and are its managing member.
The Ground Lease Plus Fund includes three assets and targets high quality projects in pre-construction development phase with institutional developers. The Leasehold Loan Fund currently includes four assets and allows for customers to receive their full capital structure needs in one place. Customers are able to receive a mortgage leasehold loan as well as a Ground Lease through us.
The Leasehold Loan Fund currently includes three assets and allows customers to receive their full capital structure needs in one place. Customers are able to receive a mortgage leasehold loan as well as a Ground Lease through us.
As of December 31, 2024, the Company owned 84.3% of the outstanding Caret units.
As of December 31, 2025, the Company owned 83.8% of the outstanding Caret units.
Additionally, our product “SAFExSELL” provides clients with an opportunity to enter into a Ground Lease at the time of the sale of a real estate asset, generating greater proceeds than would normally be expected in connection with a fee simple sale. ​ We are a Maryland corporation and our common stock is listed on the New York Stock Exchange under the symbol "SAFE." The Company, then known as iStar, elected to be taxed as a real estate investment trust ("REIT") for U.S. federal income tax purposes, commencing with the tax year ended December 31, 1998. ​ Investment Strategy Our primary investment objective is to construct a diversified portfolio of Ground Leases that will generate attractive high-quality risk-adjusted returns and support stable and growing distributions to our shareholders.
The Company and Star Holdings also entered into a governance agreement that places certain restrictions on the transfer and voting of the shares of the Company owned by Star Holdings, and a registration rights agreement under which the Company agreed to register such shares for resale in accordance with applicable securities laws. ​ We are a Maryland corporation and our common stock is listed on the New York Stock Exchange under the symbol "SAFE." The Company, then known as iStar, elected to be taxed as a real estate investment trust ("REIT") for U.S. federal income tax purposes, commencing with the tax year ended December 31, 1998. ​ Investment Strategy Our primary investment objective is to construct a diversified portfolio of Ground Leases that will generate attractive high-quality risk-adjusted returns and support stable and growing distributions to our shareholders.
We currently hold all of the issued and outstanding GL units of Portfolio Holdings. ​ In general, all of our Ground Leases are subject to the Caret program, except for non-commercial Ground Leases and pre-development Ground Leases.
(“MSD Partners”) and other outside investors. ​ In general, all of our Ground Leases are subject to the Caret program, except for non-commercial Ground Leases and pre-development Ground Leases.
(2) Combined Property Value as of December 31, 2023 includes one investment in our Ground Lease Plus Fund (which we acquired from the Ground Lease Plus Fund in January 2024 - refer to Note 7 to the consolidated financial statements), and for both periods includes our applicable percentage interests in our unconsolidated Ground Lease ventures and $319.8 million and $1,357.4 million related to transactions with remaining unfunded commitments as of December 31, 2024 and 2023, respectively.
(2) Combined Property Value as of December 31, 2025 and 2024 includes our applicable percentage interests in our unconsolidated Ground Lease ventures and $616.2 million and $319.8 million related to transactions with remaining unfunded commitments as of December 31, 2025 and 2024, respectively.
We have engaged an independent valuation firm to prepare: (a) initial reports of the Combined Property Value associated with our Ground Lease portfolio; and (b) periodic updates of such reports, which we use, in part, to determine the current estimated value of our owned residual portfolio.
The value may be realized by us at the relevant time by entering into a new lease reflecting then current market terms and values, selling the building, selling the building with the land, or operating the building directly and leasing the spaces to tenants at prevailing market rates. 2 Table of Contents We have engaged an independent valuation firm to prepare: (a) initial reports of the Combined Property Value associated with our Ground Lease portfolio; and (b) periodic updates of such reports, which we use, in part, to determine the current estimated value of our owned residual portfolio.
In connection with the Spin-Off, Safehold Management Services Inc. (“SpinCo Manager”), a Delaware corporation and a subsidiary of the Company, entered into a management agreement with Star Holdings effective as of March 31, 2023, pursuant to which SpinCo Manager will continue to operate and pursue the orderly monetization of Star Holding’s assets.
Following the Merger, the Company, through its subsidiary, Safehold Management Services Inc. (“SpinCo Manager”), a Delaware corporation, serves as external manager to Star Holdings. SpinCo Manager is party to a management agreement with Star Holdings pursuant to which SpinCo Manager operates and pursues the orderly monetization of Star Holding’s assets.
Ground Lease Cost as of December 31, 2023 includes one investment in our Ground Lease Plus Fund (which we acquired from the Ground Lease Plus Fund in January 2024), and for both periods includes our applicable percentage interests in our unconsolidated Ground Lease ventures and $46.2 million and $135.6 million (including amounts paid to the Ground Lease Plus Fund in January 2024 to acquire the investment) of unfunded commitments as of December 31, 2024 and 2023, respectively.
Ground Lease Cost as of December 31, 2025 and 2024 includes our applicable percentage interests in our unconsolidated Ground Lease ventures and $142.3 million and $46.2 million of unfunded commitments as of December 31, 2025 and 2024, respectively.
Our portfolio is comprised of Ground Leases and one master lease (relating to five hotel assets that we refer to as our “Park Hotels Portfolio”) that provide for contractual periodic rent escalations and in some cases percentage rent participations in gross revenues generated at the relevant properties.
As of December 31, 2025, our portfolio is comprised of Ground Leases that provide for contractual periodic rent escalations and in some cases percentage rent participations in gross revenues generated at the relevant properties. 1 Table of Contents We have chosen to focus on Ground Leases because we believe they meet an important need in the real estate capital markets for our customers.
In assessing all forward-looking statements, readers are urged to read carefully all cautionary statements contained in this Form 10-K. Merger Transaction and Spin-Off On August 10, 2022, Safehold Inc. (“Old SAFE”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with iStar Inc.
(“Old SAFE”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with iStar Inc.
We believe that our business has characteristics comparable to a high-grade, fixed income investment business, but with certain unique advantages.
In assessing all forward-looking statements, readers are urged to read carefully all cautionary statements contained in this Form 10-K. Business We are a publicly-traded company that operates our business through one reportable segment by acquiring, managing and capitalizing ground leases. We believe that our business has characteristics comparable to a high-grade, fixed income investment business, but with certain unique advantages.
Following the restructuring, 100% of the equity interests in Caret Ventures is held by Portfolio Holdings, and Portfolio Holdings is owned by the Company, management of the Company, employees and former employees of the Company, affiliates of MSD Partners, L.P. (“MSD Partners”) and other outside investors.
We currently hold all of the issued and outstanding GL units of Portfolio Holdings, and the issued and outstanding Caret units are held by us, our management, our employees and former employees, affiliates of MSD Partners, L.P.
Additionally, we have created additional channels and products that allows us to build a larger, captive pipeline. In connection with the Merger, Old SAFE acquired iStar’s interests in iStar’s two Ground Lease ecosystem funds, Ground Lease Plus Fund and Leasehold Loan Fund (refer to Note 7 to the consolidated financial statements).
We have interests in two Ground Lease ecosystem funds, the Ground Lease Plus Fund and the Leasehold Loan Fund (refer to Note 8 to the consolidated financial statements), and in 2025, we also began originating leasehold loans individually. The Ground Lease Plus Fund includes two assets and targets high quality projects in pre-construction development phase with institutional developers.
Removed
For accounting purposes, the Merger is treated as a “reverse acquisition” in which iStar is considered the legal acquirer and Old SAFE is considered the accounting acquirer. As a result, the historical financial statements of Old SAFE became the historical financial statements of Safehold Inc.
Added
We believe that, similar to a loan to value metric, tracking changes in the value of our owned residual portfolio is useful as an indicator of the quality of our cash flows and the safety of our position in a tenant’s capital structure, which, in turn, supports our objective to pay and grow dividends over time.
Removed
Unless the context otherwise requires, references to “iStar” refer to iStar prior to the Merger, and references to “we,” “our” and “the Company” refer to the business and operations of Old SAFE and its consolidated subsidiaries prior to the Merger and to Safehold Inc. (formerly known as iStar Inc.) and its consolidated subsidiaries following the consummation of the Merger.
Added
Portfolio Holdings’ two classes of limited liability company interests are designed to track these two components: “GL units” are intended to track the bond component and “Caret units” are designed to track the Caret component (the “Caret program”).
Removed
Periods presented prior to the Merger date of March 31, 2023 reflect the operations of Old SAFE and periods presented subsequent to March 31, 2023 represent the financial statements of the Company.
Added
In December 2025, we granted 50,000 Caret units to an employee that will vest pro rata annually over a five-year period, subject to continued employment and service conditions.
Removed
Additionally, in connection with the Merger, Safehold Operating Partnership LP converted from a Delaware limited partnership into a Delaware limited liability company and changed its name to “Safehold GL Holdings LLC” (“Portfolio Holdings”), with the Company as its managing member. The Company conducts all of its business and owns all of its properties through Portfolio Holdings.
Added
Additionally, our product “SAFExSELL” provides clients with an opportunity to enter into a Ground Lease at the time of the sale of a real estate asset, generating greater proceeds than would normally be expected in connection with a fee simple sale. ​ 4 Table of Contents Merger Transaction: On August 10, 2022, Safehold Inc.
Removed
In addition, holders of Caret units in Old SAFE’s subsidiary, Caret Ventures LLC (“Caret Ventures”), contributed their interests in Caret Ventures to Portfolio Holdings in return for Caret units issued by Portfolio Holdings.
Added
Star Holdings was capitalized in part with an 8.0% term loan from the Company having an initial principal amount of $115.0 million (refer to Note 7 to the consolidated financial statements).
Removed
Following the Merger, the Company serves as external manager to Star Holdings. 1 Table of Contents Other Merger and Spin-Off related transactions ​ On August 10, 2022, iStar entered into an agreement (the “MSD Stock Purchase Agreement”) with MSD Partners pursuant to which MSD Partners agreed to purchase 5,405,406 shares of Old SAFE’s common stock then owned by iStar (the “MSD Stock Purchase”) for an aggregate purchase price of approximately $200 million, or $37.00 per share, payable in cash.
Removed
MSD Partners’ rights and obligations under the MSD Stock Purchase Agreement were subsequently assigned to certain of its affiliates. The MSD Stock Purchase closed on March 31, 2023, shortly before the closing of the Merger.
Removed
MSD Partners has the right to designate an observer to the board of directors of the Company, a top-up right on future equity issuances (subject to certain exceptions) and registration rights. MSD Partners is subject to a customary standstill and certain restrictions on sales of its shares of the Company’s common stock.
Removed
On August 10, 2022, MSD Partners also agreed to purchase 100,000 Caret units (refer to Note 12 to the consolidated financial statements) from the Company for an aggregate purchase price of $20.0 million (the “MSD Caret Purchase”).
Removed
MSD Partners received a credit against their purchase price for Caret units equal to the amount they would have received had they held Caret units at the time of a December 2022 distribution to other Caret unit holders, which was equal to $0.6 million.
Removed
MSD Partners’ rights and obligations under the purchase agreement were subsequently assigned to certain of its affiliates.
Removed
The closing of the MSD Caret Purchase took place in conjunction with the closing of the Merger on March 31, 2023. ​ Star Holdings was capitalized in part with an 8.0%, four-year term loan from the Company having an initial principal amount of $115.0 million, as well as SOFR plus 3.00% bank debt with an initial principal balance of $140.0 million from Morgan Stanley Bank, N.A. which is secured by approximately 12.9 million shares of the Company as of December 31, 2024.
Removed
Star Holdings paid SpinCo Manager an annual management fee of $25.0 million for the term ended March 31, 2024.
Removed
The annual fee declines to $15.0 million, $10.0 million and $5.0 million, respectively, in each of following annual terms, and adjusts to 2.0% of the gross book value of Star Holdings’ assets, excluding shares of the Company’s common stock held by Star Holdings, thereafter.
Removed
The Company and Star Holdings also entered into a governance agreement that places certain restrictions on the transfer and voting of the shares of the Company owned by Star Holdings, and a registration rights agreement under which the Company agreed to register such shares for resale in accordance with applicable securities laws. ​ Business We are a publicly-traded company that operates our business through one reportable segment by acquiring, managing and capitalizing ground leases.
Removed
We have chosen to focus on Ground Leases because we believe they meet an important need in the real estate capital markets for our customers.
Removed
The value may be realized by us at the relevant time by entering into a new lease reflecting then current market terms and values, selling the building, selling the building with the land, or operating the building directly and leasing the spaces to tenants at prevailing market rates.
Removed
In connection with the Merger, certain of Old SAFE’s executive officers entered into re-vesting agreements pursuant to which the executives agreed to subject 25% of their previously vested Caret units to additional vesting conditions which will be satisfied on March 31, 2025 (the second anniversary of the Merger), subject to the applicable executive’s continued employment through such date.
Removed
The transaction generated a net book gain for us of approximately $46.4 million. After paying closing costs, establishing reserves for Caret-related expenses and deducting the original $76.7 million cost basis to us, the remaining proceeds were distributed approximately 84% to Old SAFE and approximately 16% to the minority holders of Caret units.
Removed
In addition, the affiliates of MSD Partners received a credit against their purchase price for Caret units equal to the amount they would have received had they held Caret units at the time of the distribution. ​ Market Opportunity : We believe that there is a significant market opportunity for a dedicated provider of Ground Lease capital like us.
Removed
Prior to the Merger, we relied on the extensive investment origination and sourcing platform of iStar, the parent company of our former manager, to actively promote the benefits of the Ground Lease structure to prospective Ground Lease tenants. Subsequent to the Merger and the acquisition of iStar and its employees, we are internally managed.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

76 edited+24 added−30 removed161 unchanged
Biggest changeCertain tenant rights under our Ground Leases may limit the value we are able to realize upon lease expiration, sale of our land or other events, including, among others: (i) our Park Hotels Portfolio master lease gives the tenant the right to purchase one or more of the hotels at fair market value if the hotel suffers a major casualty or condemnation event, as defined under the master lease; (ii) prior to the expiration of the Ground Lease relating to an office property that represents 1.1% of the gross book value of our portfolio as of December 31, 2024, the tenant has the right to demolish the building and improvements on the property, although it cannot do so during the last five years of the lease without our prior consent.
Biggest changeCertain tenant rights under our Ground Leases may limit the value we are able to realize upon lease expiration, sale of our land or other events, including, among others: (i) our Park Hotels Portfolio master lease gives the tenant the right to purchase one or more of the hotels at fair market value if the hotel suffers a major casualty or condemnation event, as defined under the master lease; (ii) prior to the expiration of the Ground Lease relating to an office property that represents 1.0% of the gross book value of our portfolio as of December 31, 2025, the tenant has the right to demolish the building and improvements on the property, although it cannot do so during the last five years of the lease without our prior consent and rent under our Ground Lease must continue to be paid through the end of the lease, even if the tenant demolishes the building and any improvements on the property; (iii) the tenant under one of our Ground Leases has a buy-out option in year 49 of the lease; (iv) the Lock Up Self Storage Facility lease gives the tenant the right to purchase our interest in the underlying land at fair market value as of the expiration of the lease in 2037; (v) the tenants under certain of our Ground Leases have a right of first offer or a right of first refusal to purchase the land underlying the Ground Lease should we decide to sell the land together with the Ground Lease to a third party; and (vi) the third party ownership of a majority of the land underlying our Doubletree Seattle Airport property, as described above.
We may directly own one or more commercial properties, which will expose us to the risks of ownership of operating properties. There may be instances where we take ownership of a commercial property for a period of time prior to the separating it into fee and leasehold interests.
We may directly own one or more commercial properties, which will expose us to the risks of ownership of operating properties. There may be instances where we take ownership of a commercial property for a period of time prior to separating it into fee and leasehold interests.
Our management’s ownership of Caret units creates potential conflicts of interest. ● The Portfolio Holdings LLCA sets forth certain limitations on our ability to make changes to such agreement that could be beneficial to us and our stockholders without the consent of certain of the Caret unitholders. ● The Portfolio Holdings LLCA contains provisions that may delay, defer or prevent a change in control. ● Future issuances of debt or preferred equity securities could adversely affect our common shareholders and result in conflicts of interest. ● Our failure to remain qualified as a REIT would subject us to taxes, which would reduce the amount of cash available for distribution to our shareholders. ● The REIT distribution requirements could require us to borrow funds or take other actions that may be disadvantageous to our shareholders. ● Even if we qualify as a REIT, we may incur tax liabilities that reduce our cash flow. ​ 11 Table of Contents Risks Related to Our Portfolio and Our Business The market for Ground Lease transactions and the availability of investment opportunities may not meet our growth objectives.
Our management’s ownership of Caret units creates potential conflicts of interest. ● The Portfolio Holdings LLCA sets forth certain limitations on our ability to make changes to such agreement that could be beneficial to us and our stockholders without the consent of certain of the Caret unitholders. ● The Portfolio Holdings LLCA contains provisions that may delay, defer or prevent a change in control. ● Future issuances of debt or preferred equity securities could adversely affect our common shareholders and result in conflicts of interest. ● Our failure to remain qualified as a REIT would subject us to taxes, which would reduce the amount of cash available for distribution to our shareholders. ● The REIT distribution requirements could require us to borrow funds or take other actions that may be disadvantageous to our shareholders. ● Even if we qualify as a REIT, we may incur tax liabilities that reduce our cash flow. 10 Table of Contents ​ Risks Related to Our Portfolio and Our Business The market for Ground Lease transactions and the availability of investment opportunities may not meet our growth objectives.
For example, our office assets and business growth prospects may be adversely affected, including adverse impacts on our rents collected, Ground Rent Coverage and UCA as a result of reduced demand for office space and/or reduction in rents at our office properties as a result of an economic downturn or permanent shift in office space demand as a result of the COVID-19 pandemic or other health crises.
For example, our office assets and business growth prospects may be adversely affected, including adverse impacts on our rents collected, Ground Rent Coverage and UCA as a result of reduced demand for office space and/or reduction in rents at our office properties as a result of an economic downturn or permanent shift in office space demand following the COVID-19 pandemic or other health crises.
Certain other aspects of the Caret program could further impact the economic interests of our common stockholders, including the following: ● A lease extension (other than in accordance with the original terms of a Ground Lease) or other “GL Material Change,” as defined in the Portfolio Holdings LLCA, will result in accelerating the amounts SAFE is entitled to on account of the GL units it owns; ● Portfolio Holdings may be obligated to sell Ground Lease Assets (thereby triggering a distribution to holders of Caret units and GL units) upon any Ground Lease expiration or termination, as well as upon SAFE’s receipt of all amounts it is entitled to after a lease extension or other GL Material Change, and will be required to sell either to an affiliate via an arm’s length marketed process (and, following specified liquidity transactions, as agreed by a majority of a committee of independent directors) or to an unaffiliated third party; ● SAFE, as owner of the GL units, does not have a redemption right with respect to GL units; and ● Caret distributions are not reduced for interest and principal repayment obligations of indebtedness (other than certain debt defined in the Portfolio Holdings LLCA as a “Caret Financing”).
Certain other aspects of the Caret program could further impact the economic interests of our common stockholders, including the following: ● A lease extension (other than in accordance with the original terms of a Ground Lease) or other “GL Material Change,” as defined in the Portfolio Holdings LLCA, will result in accelerating the amounts SAFE is entitled to on account of the GL units it owns; ● Portfolio Holdings may be obligated to sell Ground Lease Assets (thereby triggering a distribution to holders of Caret units and GL units) upon any Ground Lease expiration or termination, as well as upon SAFE’s receipt of all amounts it is entitled to after a lease extension or other GL Material Change, and will be required to sell either to an affiliate via an arm’s length marketed process (and, following specified liquidity transactions, as agreed by a majority of a committee of independent directors) or to an unaffiliated third party; ● SAFE, as owner of the GL units, does not have a redemption right with respect to GL units; and 23 Table of Contents ● Caret distributions are not reduced for interest and principal repayment obligations of indebtedness (other than certain debt defined in the Portfolio Holdings LLCA as a “Caret Financing”).
We regard the difference between the initial Ground Lease value and the Combined Property Value as UCA in our owned residual portfolio that we may realize at the end of the lease through a releasing or sale transaction, or perhaps by operating the property directly.
We regard the difference between the initial Ground Lease value and the Combined Property Value as UCA in our owned residual portfolio that we may realize at the end of the lease through a releasing or sale transaction, or by operating the property directly.
Our estimates of Ground Rent Coverage for properties in development or transition, or for which we do not receive current tenant financial information, may prove to be incorrect. Certain of the Ground Leases in our portfolio relate to properties that are under development or in transition.
Our estimates of Ground Rent Coverage for properties in development or transition, or for which we do not receive current tenant financial information, may prove to be incorrect. Certain Ground Leases in our portfolio relate to properties that are under development or in transition.
Our level of debt, the costs of our debt and the limitations imposed on us by our debt agreements could have significant adverse consequences, including, without limitation, the following: ● our cash flow may be insufficient to meet our required principal and interest payments; ● we may be unable to borrow additional funds as needed on favorable terms, or at all; ● we may be unable to refinance our indebtedness at maturity or the refinancing terms may be less favorable than the terms of our original indebtedness; ● increases in interest rates could materially increase our interest expense and adversely affect our growth by significantly increasing the costs of future investments; ● we may be forced to dispose of one or more of our assets, possibly on disadvantageous terms; ● restricting us from making strategic acquisitions, developing properties, or exploiting business opportunities; ● our credit agreements prohibit us from paying distributions if there is a default thereunder, subject to limited exceptions relating to the maintenance of our REIT qualification; ● the actions or omissions of our tenants over which we have no direct control, such as a failure to pay required taxes, may trigger an event of default under certain of our mortgages (refer to Note 9 to the consolidated financial statements); ● our default under debt agreements could trigger cross-default or cross acceleration of our other debt; ● exposing us to potential credit rating downgrades; ● increasing our vulnerability to a downturn in general economic conditions; and 21 Table of Contents ● limiting our ability to react to changing market conditions in our industry.
Our level of debt, the costs of our debt and the limitations imposed on us by our debt agreements could have significant adverse consequences, including, without limitation, the following: ● our cash flow may be insufficient to meet our required principal and interest payments; ● we may be unable to borrow additional funds as needed on favorable terms, or at all; ● we may be unable to refinance our indebtedness at maturity or the refinancing terms may be less favorable than the terms of our original indebtedness; ● increases in interest rates could materially increase our interest expense and adversely affect our growth by significantly increasing the costs of future investments; ● we may be forced to dispose of one or more of our assets, possibly on disadvantageous terms; ● restricting us from making strategic acquisitions, developing properties, or exploiting business opportunities; ● our credit agreements prohibit us from paying distributions if there is a default thereunder, subject to limited exceptions relating to the maintenance of our REIT qualification; ● the actions or omissions of our tenants over which we have no direct control, such as a failure to pay required taxes, may trigger an event of default under certain of our mortgages (refer to Note 10 to the consolidated financial statements); ● our default under debt agreements could trigger cross-default or cross acceleration of our other debt; ● exposing us to potential credit rating downgrades; ● increasing our vulnerability to a downturn in general economic conditions; and ● limiting our ability to react to changing market conditions in our industry.
Additionally, on March 31, 2023, we, as a lender and an administrative agent, and Star Holdings, as a borrower, entered into a senior secured term loan facility, which was amended on October 4, 2023, in an aggregate principal amount of $115.0 million (the “Secured Term Loan Facility”) and an additional commitment amount of up to $25.0 million (the “Incremental Term Loan Facility, and together with the Secured Term Loan Facility, as amended, the “Term Loan Facility”) at Star Holdings’ election.
Additionally, on March 31, 2023, we, as a lender and an administrative agent, and Star Holdings, as a borrower, entered into a senior secured term loan facility, which was amended on October 4, 2023 and March 28, 2025, in an aggregate principal amount of $115.0 million (the “Secured Term Loan Facility”) and an additional commitment amount of up to $25.0 million (the “Incremental Term Loan Facility, and together with the Secured Term Loan Facility, as amended, the “Term Loan Facility”) at Star Holdings’ election.
In addition, tenants may fail to properly maintain their improvements, and certain improvements may become obsolete 12 Table of Contents over the long terms of our Ground Leases, which may impair the value and the UCA that we are able to realize upon a sale or re-leasing, or require us to make significant investments in order to restore the property to a suitable condition.
In 11 Table of Contents addition, tenants may fail to properly maintain their improvements, and certain improvements may become obsolete over the long terms of our Ground Leases, which may impair the value and the UCA that we are able to realize upon a sale or re-leasing, or require us to make significant investments in order to restore the property to a suitable condition.
In addition, periods of economic slowdown or recession, rising interest rates or declining demand for real estate, or the public perception that such events may occur or have occurred, could result in a general decline in attractive investment opportunities, the availability of financing for buyers and lessees of our properties or an increased incidence of defaults under our existing leases.
In addition, periods of economic slowdown or recession, elevated interest rates or declining demand for real estate, or the public perception that such events may occur or have occurred, could result in a general decline in attractive investment opportunities, the availability of financing for buyers and lessees of our properties or an increased incidence of defaults under our existing leases.
For purposes of these risk factors, the terms "our Company," "we," "our" and "us" refer to Safehold Inc. and its consolidated subsidiaries, unless the context indicates otherwise. ​ 9 Table of Contents Summary Risk Factors – ● The market for Ground Lease transactions and the availability of investment opportunities may not meet our growth objectives. ● Our operating performance and the market value of our properties are subject to risks associated with real estate assets. ● The rental payments under our leases may not keep up with changes in market value and inflation. ● We may be unable to renew expiring Ground Leases, re-lease the land or sell the properties on favorable terms or at all. ● Counterparty, geographic and industry concentrations may expose us to financial credit risk. ● A lack of recourse to creditworthy counterparties may adversely affect us and our tenants. ● Percentage rent payable under our master lease relating to the Park Hotels Portfolio is calculated on an aggregate portfolio-wide basis. ● Certain tenant rights under our Ground Leases may limit the value and the UCA we are able to realize upon lease expiration, sale of our land and Ground Leases or other events. ● We rely on Property NOI as reported to us by our tenants. ● Our estimates of Ground Rent Coverage for properties in development or transition, or for which we do not receive current tenant financial information, may prove to be incorrect. ● Our estimates of Combined Property Value are based on various assumptions and information supplied to us by our tenants, and accordingly may not be indicative of actual values. ● There can be no assurance that we will realize any incremental value from the UCA in our owned residual portfolio or that the market price of our common stock will reflect any value attributable thereto. ● Ground Leases with developers expose us to risks associated with property development and redevelopment that could materially and adversely affect us. ● We may be materially and adversely affected by the exercise of leasehold mortgagee protections. ● We are subject to the risk of bankruptcy of our tenants. ● We may directly own one or more commercial properties, which will expose us to the risks of ownership of operating properties. ● Competition may adversely affect our ability to acquire and originate investments. ● Cybersecurity risk and cyber incidents may adversely affect our business. ● Our business and growth prospects could be adversely affected by future epidemics, pandemics or other health crises. ● Our estimated UCA, Combined Property Value and Ground Rent Coverage, may not reflect current market values, including the decline in office values, and may decline materially in future periods. ● Our success depends in part on our ability to attract, retain and develop talented employees, and our failure to do so, including the loss of any of our key employees, could adversely impact our business. ● We may decide to further expand our operations through acquisitions, development opportunities and other strategic transactions. ● We are party to several agreements with Star Holdings, and may be unable to collect amounts to which we are contractually entitled, which could negatively affect our performance, financial condition, results of operations and cash flow. 10 Table of Contents ● Star Holdings owns a significant amount of our common stock, some of which serves as collateral for a margin loan. ● The concentration of our voting power may adversely affect the ability of investors to influence our policies. ● There are various potential conflicts of interest in our relationship with Star Holdings, which could result in decisions that are not in the best interest of our shareholders. ● Our management agreement with Star Holdings could distract management time and attention and give rise to disputes or other unfavorable effects, which could materially and adversely affect our business, financial position or results of operations. ● Our debt obligations will reduce cash available for distribution and expose us to the risk of default. ● Our failure to hedge interest rates effectively could materially and adversely affect us. ● Joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on partners’ or co-venturers’ financial position and liquidity and disputes between us and our co-venturers. ● Our depreciation expenses are expected to be limited for financial and tax reporting purposes, with the result that we will be highly dependent on external capital sources to fund our growth. ● Our credit ratings will impact our borrowing costs and our access to debt capital markets. ● We are a holding company and will rely on funds from Portfolio Holdings to pay our obligations and distributions to our shareholders. ● Certain provisions of Maryland law and our organizational documents could inhibit changes in control of our company. ● Certain provisions of our organizational documents limit shareholder recourse and access to judicial fora. ● Cash available for distribution may not be sufficient to make distributions to our shareholders at expected levels, or at all. ● The availability of shares for future sale could adversely affect the market price of our common stock. ● Distributions to holders of Caret units will reduce distributions to us upon certain transactions, and sales of additional Caret units may dilute the economic interests of our common stockholders. ● The changes to the Caret program in connection with the Merger may fail to improve the recognition of SAFE’s two distinct components of value by market participants. ● The terms of Caret units could result in conflicts of interest between holders of our common stock and holders of Caret units.
For purposes of these risk factors, the terms "our Company," "we," "our" and "us" refer to Safehold Inc. and its consolidated subsidiaries, unless the context indicates otherwise. ​ 8 Table of Contents Summary Risk Factors – ● The market for Ground Lease transactions and the availability of investment opportunities may not meet our growth objectives. ● Our operating performance and the market value of our properties are subject to risks associated with real estate assets. ● The rental payments under our leases may not keep up with changes in market value and inflation. ● We may be unable to renew expiring Ground Leases, re-lease the land or sell the properties on favorable terms or at all. ● Counterparty, geographic and industry concentrations may expose us to financial credit risk. ● A lack of recourse to creditworthy counterparties may adversely affect us and our tenants. ● Percentage rent payable under our master lease relating to the Park Hotels Portfolio is calculated on an aggregate portfolio-wide basis. ● Certain tenant rights under our Ground Leases may limit the value and the UCA we are able to realize upon lease expiration, sale of our land and Ground Leases or other events. ● We rely on Property NOI as reported to us by our tenants. ● Our estimates of Ground Rent Coverage for properties in development or transition, or for which we do not receive current tenant financial information, may prove to be incorrect. ● Our estimates of Combined Property Value are based on various assumptions and information supplied to us by our tenants and accordingly may not be indicative of actual values. ● There can be no assurance that we will realize any incremental value from the UCA in our owned residual portfolio or that the market price of our common stock will reflect any value attributable thereto. ● Ground Leases with developers expose us to risks associated with property development and redevelopment that could materially and adversely affect us. ● We may be materially and adversely affected by the exercise of leasehold mortgagee protections. ● We are subject to the risk of bankruptcy of our tenants. ● We may directly own one or more commercial properties, which will expose us to the risks of ownership of operating properties. ● Competition may adversely affect our ability to acquire and originate investments. ● Cybersecurity risk and cyber incidents may adversely affect our business. ● Our business and growth prospects could be adversely affected by future epidemics, pandemics or other health crises. ● Our estimated UCA, Combined Property Value and Ground Rent Coverage, may not reflect current market values, including the decline in office values, and may decline materially in future periods. ● Our success depends in part on our ability to attract, retain and develop talented employees, and our failure to do so, including the loss of any of our key employees, could adversely impact our business. ● We may decide to further expand our operations through acquisitions, development opportunities and other strategic transactions. ● We are party to several agreements with Star Holdings and may be unable to collect amounts to which we are contractually entitled, which could negatively affect our performance, financial condition, results of operations and cash flow. 9 Table of Contents ● Star Holdings owns a significant amount of our common stock, all of which serves as collateral for a margin loan. ● The concentration of our voting power may adversely affect the ability of investors to influence our policies. ● There are various potential conflicts of interest in our relationship with Star Holdings, which could result in decisions that are not in the best interest of our shareholders. ● Our debt obligations will reduce cash available for distribution and expose us to the risk of default. ● Our failure to hedge interest rates effectively could materially and adversely affect us. ● Joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on partners’ or co-venturers’ financial position and liquidity and disputes between us and our co-venturers. ● Our depreciation expenses are expected to be limited for financial and tax reporting purposes, with the result that we will be highly dependent on external capital sources to fund our growth. ● Our credit ratings will impact our borrowing costs and our access to debt capital markets. ● We are a holding company and will rely on funds from Portfolio Holdings to pay our obligations and distributions to our shareholders. ● Certain provisions of Maryland law and our organizational documents could inhibit changes in control of our company. ● Certain provisions of our organizational documents limit shareholder recourse and access to judicial fora. ● Cash available for distribution may not be sufficient to make distributions to our shareholders at expected levels, or at all. ● The availability of shares for future sale could adversely affect the market price of our common stock. ● Distributions to holders of Caret units will reduce distributions to us upon certain transactions, and sales of additional Caret units may dilute the economic interests of our common stockholders. ● The design of the Caret program may not result in the recognition of SAFE’s two distinct components of value by market participants. ● The terms of Caret units could result in conflicts of interest between holders of our common stock and holders of Caret units.
Borrowings under the Term Loan Facility bear interest at a fixed rate of 8.00% per annum, which may increase to 10.00% per annum if any loans remain outstanding under the Incremental Term Loan Facility. The Term Loan Facility has certain prepayment obligations, and a maturity of March 31, 2027.
Borrowings under the Term Loan Facility bear interest at a fixed rate of 8.00% per annum, which may increase to 10.00% per annum if any loans remain outstanding under the Incremental Term Loan Facility. The Term Loan Facility has certain prepayment obligations, and a maturity of March 31, 2028.
This creates potential conflicts of interest when management is faced with decisions that could have different implications for holders of Caret units and holders of our common stock, as management may be incentivized to make decisions that benefit holders of Caret units as opposed to holders of our common stock. ​ The Portfolio Holdings LLCA sets forth certain limitations on our ability to make changes to such agreement that could be beneficial to us and our stockholders without the consent of certain of the Caret unitholders.
This creates potential conflicts of interest when management is faced with decisions that could have different implications for holders of Caret units and holders of our common stock, as management may be incentivized to make decisions that benefit holders of Caret units as opposed to holders of our common stock. ​ 24 Table of Contents The Portfolio Holdings LLCA sets forth certain limitations on our ability to make changes to such agreement that could be beneficial to us and our stockholders without the consent of certain of the Caret unitholders.
Thus, while we believe we have been organized and operated and intend to continue to operate so that we will qualify as a REIT, given the highly complex nature of the 27 Table of Contents rules governing REITs, the ongoing importance of factual determinations, and the possibility of future changes in our circumstances, no assurance can be given that we have qualified or will continue to so qualify for any particular year.
Thus, while we believe we have been organized and operated and intend to continue to operate so that we will qualify as a REIT, given the highly complex nature of the rules governing REITs, the ongoing importance of factual determinations, and the possibility of future changes in our circumstances, no assurance can be given that we have qualified or will continue to so qualify for any particular year.
In addition, we will be subject to U.S. federal income tax at regular corporate rates to the extent that we distribute less than 100% of our net taxable income (including net capital gains) and will be subject to a 4% nondeductible excise tax on the amount by which our distributions in any calendar year are less than a minimum amount specified under U.S. federal income tax laws.
In addition, we will be subject to U.S. federal income tax at regular corporate rates to the extent that we distribute less than 100% of our net taxable income (including net capital gains) and will be subject to a 4% nondeductible excise tax on the amount by which our distributions in any calendar year are less than a minimum amount specified under U.S. federal income tax 26 Table of Contents laws.
Additionally, immediately following the Merger, 76,801 Caret units were awarded to executive officers and other employees that are subject to cliff vesting on the fourth anniversary of their grant date if our common stock has traded at an average per share price of $60.00 or more for at least 30 consecutive trading days during that four-year period. ​ As a result, as of December 31, 2024, vested and unvested Caret units beneficially owned by our officers and other employees represent approximately 11.4% of the authorized Caret units, including 6.1% held directly and indirectly by Jay Sugarman, our Chairman and Chief Executive Officer.
Immediately following the Merger, 76,801 Caret units were awarded to executive officers and other employees that are subject to cliff vesting on the fourth anniversary of their grant date if our common stock has traded at an average per share price of $60.00 or more for at least 30 consecutive trading days during that four-year period. ​ As a result, as of December 31, 2025, vested and unvested Caret units beneficially owned by our officers and other employees represent approximately 11.9% of the authorized Caret units, including 6.1% held directly and indirectly by Jay Sugarman, our Chairman and Chief Executive Officer.
Our board of directors 25 Table of Contents intends to exercise its judgment from time to time, depending on the circumstances, as it believes the advantage of retaining flexibility in determining how to fulfill its responsibilities in any such circumstances as they may arise outweigh any perceived advantages of adopting additional specific procedures. ​ Additionally, our management’s ownership of Caret units creates potential conflicts of interest.
Our board of directors intends to exercise its judgment from time to time, depending on the circumstances, as it believes the advantage of retaining flexibility in determining how to fulfill its responsibilities in any such circumstances as they may arise outweigh any perceived advantages of adopting additional specific procedures. ​ Additionally, our management’s ownership of Caret units creates potential conflicts of interest.
The existence of these rights in existing and future leases may adversely affect the value and the UCA we are able to realize upon a sale of our Ground Leases and/or make it more difficult to re-let a property after the expiration of a lease. We rely on Property NOI as reported to us by our tenants.
The existence of these rights in existing and future leases may adversely affect the value and the UCA we are able to realize upon a sale of our Ground Leases and/or make it more difficult to re-let a property after the expiration of a lease. 13 Table of Contents We rely on Property NOI as reported to us by our tenants.
Negative publicity about the experience of tenants with non-Safehold Ground Leases may also discourage potential tenants. In addition, increases in interest rates have and may continue to result in a reduction in the availability or an increase in costs of leasehold financing, which is critical to the growth of a robust Ground Lease market.
Negative publicity about the experience of tenants with non-Safehold Ground Leases may also discourage potential tenants. In addition, elevated or increasing interest rates have and may continue to result in a reduction in the availability or an increase in costs of leasehold financing, which is critical to the growth of a robust Ground Lease market.
Though we estimate Combined Property Value using one or more valuation methodologies that we consider appropriate, there can be no assurance that this estimate or the amount of any UCA in our owned residual portfolio is accurate at the time we invest in a Ground Lease.
Though we estimate Combined Property Value using one or more valuation methodologies that we consider appropriate, there can be no assurance that this estimate or the amount of any UCA in our owned residual portfolio is accurate at the time we invest in a Ground 14 Table of Contents Lease.
Our executive officers have duties to our company under applicable Maryland law, and our executive officers who are also officers of Star Holdings have duties to Star Holdings under applicable Maryland law. Those duties may come in conflict from time to time.
Our executive officers have duties to our company under applicable Maryland law, and our executive officers who are also officers of Star Holdings have duties to Star Holdings under applicable Maryland law. Those duties may come into conflict from time to time.
As of December 31, 2024, the Term Loan Facility had an outstanding principal balance of $115.0 million and no borrowing had been made under the Incremental Term Loan Facility.
As of December 31, 2025, the Term Loan Facility had an outstanding principal balance of $115.0 million and no borrowing had been made under the Incremental Term Loan Facility.
In addition, if our tenant has obtained leasehold financing to complete construction, and the construction lender forecloses on the mortgage following a default, there is a risk that the 15 Table of Contents mortgagee or a new tenant may not have necessary or sufficient development experience to complete the project or to do so to the same standards as the original developer.
In addition, if our tenant has obtained leasehold financing to complete construction, and the construction lender forecloses on the mortgage following a default, there is a risk that the mortgagee or a new tenant may not have necessary or sufficient development experience to complete the project or to do so to the same standards as the original developer.
The bankruptcy or insolvency of a tenant may materially and adversely affect the income produced by our properties or could force us to "take back" a property as a result of a default or a rejection of the lease by a tenant in bankruptcy, any of which could materially and adversely affect us.
The bankruptcy or insolvency of a tenant may materially and adversely affect the income produced by our properties or could force us to "take back" a property as a result of a default or a rejection of the lease by a tenant in bankruptcy, any of which could materially and 15 Table of Contents adversely affect us.
We have interests in the Ground Lease Plus Fund (refer to Note 7 to the consolidated financial statements), which targets the origination and acquisition of pre-development phase Ground Leases, and the Leasehold Loan Fund (refer to Note 7 to the consolidated financial statements), which provides leasehold loans behind a Ground Lease (the “Ventures”).
We also have interests in the Ground Lease Plus Fund (refer to Note 8 to the consolidated financial statements), which targets the origination and acquisition of pre-development phase Ground Leases, and the Leasehold Loan Fund (refer to Note 8 to the consolidated financial statements), which provides leasehold loans behind a Ground Lease (the “Ventures”).
As of December 31, 2024, we had approximately $4.4 billion principal amount of outstanding indebtedness (which includes $100 million of trust preferred securities of a consolidated subsidiary that bear interest at a per annum rate equal to three-month adjusted term SOFR plus 1.50%, but excludes $272 million of mortgage debt, representing our pro rata share of debt associated with our non-consolidated joint ventures (equity method investments)), and $1.3 billion of borrowing capacity available (subject to customary conditions) under our unsecured credit facility.
As of December 31, 2025, we had approximately $4.6 billion principal amount of outstanding indebtedness (which includes $100 million of trust preferred securities of a consolidated subsidiary that bear interest at a per annum rate equal to three-month adjusted term SOFR plus 1.50%, but excludes $270 million of mortgage debt, representing our pro rata share of debt associated with our non-consolidated joint ventures (equity method investments)), and $1.2 billion of borrowing capacity available (subject to customary conditions) under our unsecured credit facility.
We have implemented processes, procedures and internal controls to help mitigate cybersecurity risks and cyber intrusions, but there can be no assurance that our cybersecurity risk management program and processes, including our policies, controls or procedures, will be fully implemented, complied with or effective in protecting our systems and information.
We have implemented processes, procedures and internal controls to help 16 Table of Contents mitigate cybersecurity risks and cyber intrusions, but there can be no assurance that our cybersecurity risk management program and processes, including our policies, controls or procedures, will be fully implemented, complied with or effective in protecting our systems and information.
We have established an equity incentive plan (the “Plan”) providing for grants of Caret units to our directors, officers and employees and other eligible participants representing up to 1,500,000 Caret units, 1,371,254 of which are currently outstanding.
We have established an equity incentive plan (the “Plan”) providing for grants of Caret units to our directors, officers and employees and other eligible participants representing up to 1,500,000 Caret units, 1,421,004 of which are currently outstanding.
Risks associated with development transactions include, without limitation: (i) the availability and pricing of financing for the developer on favorable terms or at all, due to rising interest rates or otherwise; (ii) counterparty risk with leasehold lenders that have future funding obligations; (iii) the availability and timely receipt by the developer of zoning and other regulatory approvals; (iv) the potential for the fluctuation of occupancy rates and rents, which could affect any percentage rents that we may receive; (v) development, repositioning and redevelopment costs may be higher than anticipated by the developer, which may cause the developer to abandon the project; and (vi) cost overruns and untimely completion of construction (including due to risks beyond the developer’s control, such as weather or labor conditions, inflationary pressures, supply chain disruptions or material shortages).
Risks associated with development transactions include, without limitation: (i) the availability and pricing of financing for the developer on favorable terms or at all, due to elevated or rising interest rates or otherwise; (ii) counterparty risk with leasehold lenders that have future funding obligations; (iii) the availability and timely receipt by the developer of zoning and other regulatory approvals; (iv) the potential for the fluctuation of occupancy rates and rents, which could affect any percentage rents that we may receive; (v) development, repositioning and redevelopment costs may be higher than anticipated by the developer, which may cause the developer to abandon the project; and (vi) cost overruns and untimely completion of construction (including due to risks beyond the developer’s control, such as weather or labor conditions, inflationary pressures, increases in the cost of imported goods and materials due to threatened or implemented tariffs and/or international trade disputes, supply chain disruptions or material shortages).
The availability of shares for future sale could adversely affect the market price of our common stock. We cannot predict whether future issuances of shares of our common stock or the availability of shares for resale in the open market will decrease the market price of our common stock. Under the terms of registration rights agreements, MSD Partners, L.P.
We cannot predict whether future issuances of shares of our common stock or the availability of shares for resale in the open market will decrease the market price of our common stock. Under the terms of registration rights agreements, MSD Partners, L.P.
For example, one of our tenants under our Park Hotels Portfolio master lease elected to not extend the leases underlying two of the five hotels past December 2025.
For example, the tenant under our Park Hotels Portfolio master lease elected to not extend the leases underlying two of the five hotels past December 2025.
Our tenant elected to not extend the master lease in connection with two of the five hotels past December 2025. The two hotels not extended were responsible for $1.1 million of the $3.5 million of percentage rent received in 2024.
Our tenant elected to not extend the master lease in connection with two of the five hotels past December 2025. The two hotels not extended were responsible for $1.2 million of the $3.9 million percentage rent received in 2025.
With respect to other properties, the property NOI available to us at December 31, 2024 may not be indicative of future periods, depending on the direction and magnitude of demand shifts for the entire period.
With respect to other properties, the property NOI available to us as of December 31, 2025 may not be indicative of future periods, depending on the direction and magnitude of demand shifts for the entire period.
We received $3.5 million of percentage rent payments from our Park Hotels Portfolio in 2024 (which reflect 2023 operations), $2.8 million of percentage rent payments from our Park Hotels Portfolio in 2023 (which reflect 2022 operations) and received no percentage rent payments in 2022 (which reflect 2021 operations).
We received $3.9 million of percentage rent payments from our Park Hotels Portfolio in 2025 (which reflect 2024 operations), $3.5 million of percentage rent payments from our Park Hotels Portfolio in 2024 (which reflect 2023 operations) and $2.8 million of percentage rent payments from our Park Hotels Portfolio in 2023 (which reflect 2022 operations).
We do not independently investigate or verify the information provided to us by our tenants and 14 Table of Contents no assurance can be given that the information is accurate.
We do not independently investigate or verify the information provided to us by our tenants and no assurance can be given that the information is accurate.
In addition to the Caret units reserved for issuance under the Plan, we have sold 122,500 Caret units to third-party investors, including affiliates of MSD Partners, that remain outstanding as of December 31, 2024. As a result, we currently own the remaining 84.3% of the outstanding Caret units.
In addition to the Caret units reserved for issuance under the Plan, we have sold 122,500 Caret units to third-party investors, including affiliates of MSD Partners, that remain outstanding as of December 31, 2025. As a result, we currently own the remaining 83.8% of the outstanding Caret units.
The Ventures are with an institutional third-party partner. The combined book value of the Ventures is less than 1% of our gross book value. The assets owned by these Ventures create higher returns but also may involve additional risk than our typical Ground Leases.
The Ventures are with an institutional third-party partner. The combined book value of the Ventures is less than 1% of our gross book value. The assets owned by these Ventures have the potential to create higher returns but also may involve additional risks than those faced with our typical Ground Leases.
Such subsidiary corporations will be subject to U.S. federal, state and local corporate income taxes, including potential penalty taxes, which would decrease the cash available for distribution to our shareholders. ​
Such subsidiary corporations will be subject to U.S. federal, state and local corporate income taxes, including potential penalty taxes, which would decrease the cash available for distribution to our shareholders. ​ Item 1B. Unresolved Staff Comments None.
Additionally, the rise in interest rates and increased 16 Table of Contents investment spreads to treasury bonds in the Ground Lease market may attract new competitors, which may result in higher costs for properties, lower returns and impact our ability to grow our business. Cybersecurity risk and cyber incidents may adversely affect our business.
Additionally, elevated or rising interest rates and increased investment spreads to treasury bonds in the Ground Lease market may attract new competitors, which may result in higher costs for properties, lower returns and impact our ability to grow our business. Cybersecurity risk and cyber incidents may adversely affect our business.
Star Holdings owns a significant amount of our common stock, some of which serves as collateral for a margin loan. As of December 31, 2024, Star Holdings owned approximately 18.9% of the outstanding shares of our common stock.
Star Holdings owns a significant amount of our common stock, all of which serves as collateral for a margin loan. As of December 31, 2025, Star Holdings owned approximately 18.8% of the outstanding shares of our common stock.
To qualify as a REIT, the subsidiary REIT must independently satisfy all of the REIT qualification requirements. The failure of a subsidiary REIT to qualify as a REIT could have an adverse effect on our ability to comply with the REIT income and asset tests, and thus our ability to qualify as a REIT.
The failure of a subsidiary REIT to qualify as a REIT could have an adverse effect on our ability to comply with the REIT income and asset tests, and thus our ability to qualify as a REIT.
We conduct substantially all of our operations through Portfolio Holdings. As a holding company, claims of shareholders are structurally subordinated to all existing and future creditors and preferred equity holders of Portfolio Holdings and its subsidiaries.
As a holding company, claims of shareholders are structurally subordinated to all existing and future creditors and preferred equity holders of Portfolio Holdings and its subsidiaries.
Our reported estimated UCA and Combined Property Value are based, in part, on valuations associated with each Ground Lease that occur every 12 to 24 months. Certain metrics that we report and monitor may not reflect current market values, including the decline in office values.
Our estimated UCA, Combined Property Value and Ground Rent Coverage, may not reflect current market values, including the decline in office values, and may decline materially in future periods. Our reported estimated UCA and Combined Property Value are based, in part, on valuations associated with each Ground Lease that occur every 12 to 24 months.
We may issue additional debt or equity securities in the future. Upon liquidation, holders of our debt and preferred stock will receive a distribution of our available assets before holders of our common stock.
Future issuances of debt or preferred equity securities could adversely affect our common shareholders and result in conflicts of interest. We may issue additional debt or equity securities in the future. Upon liquidation, holders of our debt and preferred stock will receive a distribution of our available assets before holders of our common stock.
Therefore, in the event of a bankruptcy, insolvency, liquidation or reorganization of Portfolio Holdings or its subsidiaries, assets of Portfolio Holdings or the applicable subsidiary will be available to satisfy our claims to us as an equity owner therein only after all of their liabilities and preferred equity have been paid in full and only to the extent of the Portfolio Holdings’ interests in the subsidiaries.
Therefore, in the event of a bankruptcy, insolvency, liquidation or reorganization of Portfolio Holdings or its subsidiaries, assets of Portfolio Holdings or the applicable subsidiary will be available to satisfy our claims to us as an equity owner therein only after all of their liabilities and preferred equity have been paid in full and only to the extent of the Portfolio Holdings’ interests in the subsidiaries. 21 Table of Contents Certain provisions of Maryland law and our organizational documents could inhibit changes in control of our company.
The ownership and operation of commercial properties will expose us to risks, including, without limitation, the risks described above under "— Our operating performance and the market value of our properties are subject to risks associated with real estate assets ." Additionally, we may be required to hold a commercial property in a taxable REIT subsidiary ("TRS"), and any gain from the subsequent sale of the property or a leasehold interest in it would be subject to corporate income tax.
The ownership and operation of commercial properties will expose us to risks, including, without limitation, the risks described above under "— Our operating performance and the market value of our properties are subject to risks associated with real estate assets ," “— We are subject to various risks common to the hotel industry with respect to any hotels that we are responsible for operating” and “— We depend on the ability of independent hotel operators to operate and manage the hotels that we are responsible for operating.” Additionally, we may be required to hold a commercial property in a taxable REIT subsidiary ("TRS"), and any gain from the subsequent sale of the property or a leasehold interest in it would be subject to corporate income tax.
The annual fee declines to $10.0 million and $5.0 million, respectively, for each of the following annual terms, and adjusts to 2.0% of the gross book value of Star Holdings’ assets, excluding shares of the Company’s common stock held by Star Holdings, thereafter. The management fee is payable in cash quarterly, in arrears.
The annual management fee adjusts to 2.0% of the gross book value of Star Holdings’ assets, excluding shares of the Company’s common stock held by Star Holdings, thereafter. The management fee is payable in cash quarterly, in arrears.
Our tenants do not, nor do we expect that future tenants will, provide us with full financial statements prepared in accordance with GAAP or audited or reviewed by an independent registered public accounting firm.
Our tenants do not, nor do we expect that future tenants will, provide us with full financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) or audited or reviewed by an independent registered public accounting firm.
Given the limitations of the information used in our estimates it is possible that the actual Ground Rent Coverage may be lower than our estimate, now or in the future. We are part of two joint ventures that have a different investment profile than our typical Ground Leases, which could materially and adversely affect us.
Given the limitations of the information used in our estimates it is possible that the actual Ground Rent Coverage may be lower than our estimate, now or in the future. We may explore investments other than our typical Ground Leases through joint ventures or otherwise, which could materially and adversely affect us.
The absence of the drag-along right after a liquidity transaction could make us a less attractive target for acquisition and therefore delay, deter or prevent a transaction or a change in control that might involve a premium price for our common stock or otherwise be in the best interests of our common stockholders. 26 Table of Contents Future issuances of debt or preferred equity securities could adversely affect our common shareholders and result in conflicts of interest.
The absence of the drag-along right after a liquidity transaction could make us a less attractive target for acquisition and therefore delay, deter or prevent a transaction or a change in control that might involve a premium price for our common stock or otherwise be in the best interests of our common stockholders.
If sufficient cash is not available for distribution from our operations, we may have to fund distributions from working capital or borrow funds, issue equity or sell assets to pay for such distribution, or eliminate or otherwise reduce the amount of such distribution. Any distributions we make in the future could differ materially from our past distributions or current expectations.
If sufficient cash is not available for distribution from our operations, we may have to fund distributions from working capital 22 Table of Contents or borrow funds, issue equity or sell assets to pay for such distribution, or eliminate or otherwise reduce the amount of such distribution.
We are obligated to pay the third-party owner of the Ground Lease $0.5 million, subject to adjustment for changes in the CPI, per year through 2044; however, we pass this cost on to our tenant under the terms of our master lease.
We are obligated to pay the third-party owner of the Ground Lease $0.5 million, subject to adjustment for changes in the CPI, per year through 2044.
A majority of the land underlying our Doubletree Seattle Airport property is owned by a third party and is ground leased to us.
A majority of the land underlying our Doubletree Seattle Airport property, which is one of the hotels we recently became responsible for operating, is owned by a third party and is ground leased to us.
Our partnerships or joint ventures may be subject to debt and we could be forced to fund our partners’ or co-venturers’ share of such debt if they fail to make the required payments in order to preserve our investment.
Our partnerships or joint ventures may be subject to debt and we could be forced to fund our partners’ or co-venturers’ share of such debt if they fail to make the required payments in order to preserve our investment. As of December 31, 2025, we had an aggregate $280.9 million of carrying value in joint venture investments.
For the year ended December 31, 2024, our two largest tenants by revenues accounted for approximately 4.5% and 4.4%, respectively, of our total revenues. For the year ended December 31, 2024, 36.9% of our total revenues came from multifamily properties, 36.4% came from office properties and 10.2% came from hotel properties.
For the year ended December 31, 2025, our two largest tenants by revenues each accounted for approximately 4.3% of our total revenues. For the year ended December 31, 2025, 41% of our total revenues came from multifamily properties, 35% came from office properties and 10% came from hotel properties.
Moreover, a collateral call or mandatory repayment may occur at a time when Star Holdings is subject to contractual or statutory prohibitions from selling. 19 Table of Contents The concentration of our voting power may adversely affect the ability of investors to influence our policies.
Moreover, a collateral call or mandatory repayment may occur at a time when Star Holdings is subject to contractual or statutory prohibitions from selling. The concentration of our voting power may adversely affect the ability of investors to influence our policies. As of December 31, 2025, Star Holdings owned approximately 18.8% of the outstanding shares of our common stock.
Lagging valuations may not accurately capture declines in our UCA and ratio of gross book value to Combined Property Value and such decline could be reflected in future periods, and any such decline could be material.
Certain metrics that we report and monitor may not reflect current market values, including the decline in office values. Lagging valuations may not accurately capture declines in our UCA and ratio of gross book value to Combined Property Value and such decline could be reflected in future periods, and any such decline could be material.
There can be no assurances as to the value that may be attributed to Caret units in the future. In addition, our ability to recognize value through reversion rights may be limited by the rights of our tenants under some of our Ground Leases.
In addition, our ability to recognize value through reversion rights may be limited by the rights of our tenants under some of our Ground Leases.
In addition, we may own and operate commercial properties that revert to us upon the expiration or termination of a Ground Lease.
In addition, we may own and operate commercial properties that revert to us upon the expiration or termination of a Ground Lease. For example, on January 1, 2026 we became responsible for operating two hotel properties.
In consideration for our management services, Star Holdings paid us an annual management fee of $25.0 million for the term ended March 31, 2024 and will pay an annual management fee of $15.0 million for the term ended March 31, 2025.
In consideration for our management services, Star Holdings paid us an annual management fee of $15.0 million for the one-year term ended March 31, 2025 and will pay us a management fee of $10.0 million and $7.5 million for the terms ending March 31, 2026 and 2027, respectively.
These provisions of our organizational documents may limit shareholder recourse for actions of our present and former directors and executive officers and limit their ability to obtain a judicial forum that they find favorable for disputes with our company or our directors, officers, employees, if any, or other shareholders. 23 Table of Contents Risks Related to Our Common Stock Cash available for distribution may not be sufficient to make distributions to our shareholders at expected levels, or at all.
These provisions of our organizational documents may limit shareholder recourse for actions of our present and former directors and executive officers and limit their ability to obtain a judicial forum that they find favorable for disputes with our company or our directors, officers, employees, if any, or other shareholders.
Any deterioration in the operating performance at any of the hotels in the Park Hotels Portfolio would adversely affect our ability to earn percentage rent under such hotels, and it is possible that poor operating performance at one or more such hotels could reduce or eliminate percentage rent for any annual period notwithstanding stable or improving operating performance at other hotels included in the Park Hotels Portfolio.
Any deterioration in the operating performance at any of the remaining hotels in the Park Hotels Portfolio for so long as they remain under the master lease would adversely affect our ability to earn percentage rent under such hotels, and it is possible that poor operating performance at one or more such hotels could reduce or eliminate percentage rent for any annual period notwithstanding stable or improving operating performance at other hotels included in the Park Hotels Portfolio. 12 Table of Contents We are subject to various risks common to the hotel industry with respect to any hotels that we are responsible for operating.
The agreements between Safehold and Star Holdings entered into in connection with the Spin-Off may not reflect terms that would have resulted from arm’s-length negotiations with unaffiliated third parties.
We also have duties as the manager of Star Holdings which may come into conflict with our duties to our shareholders from time to time. 19 Table of Contents The agreements between Safehold and Star Holdings entered into in connection with the Spin-Off may not reflect terms that would have resulted from arm’s-length negotiations with unaffiliated third parties.
Any downgrade in our credit ratings will increase our borrowing costs under our credit facilities and could have a material adverse effect on our ability to raise capital in the debt capital markets, which could in turn have a material adverse effect on our business, liquidity and the market price of our common stock. 22 Table of Contents Risks Related to Our Organization and Structure We are a holding company and will rely on funds from Portfolio Holdings to pay our obligations and distributions to our shareholders.
Any downgrade in our credit ratings will increase our borrowing costs under our credit facilities and could have a material adverse effect on our ability to raise capital in the debt capital markets, which could in turn have a material adverse effect on our business, liquidity and the market price of our common stock.
If the underlying Ground Lease is not renewed by the landlord on or before its expiration in 2044, our lease of the Doubletree Seattle Airport hotel to our tenant 13 Table of Contents would also terminate which would result in the loss to us of the rental income from this hotel as well as any UCA that had not been realized by that time.
If the underlying Ground Lease is not renewed by the landlord on or before its expiration in 2044, we would lose the income from this hotel as well as any UCA that had not been realized by that time.
As of September 30, 2024, the outstanding principal balance was $87.4 million. As of December 31, 2024, the Margin Loan Facility is secured by 12.9 million shares of our common stock held by Star Holdings.
LC, as sole custodian, calculation agent and collateral agent (the “Margin Loan Facility”). As of September 30, 2025, the outstanding principal balance was $89.3 million. As of December 31, 2025, the Margin Loan Facility is secured by the shares of our common stock held by Star Holdings.
If we fail to meet the market’s expectations with regard to future operating results and cash distributions, the market price of our common stock could be adversely affected. Stockholders of the Company have no contractual or other legal right to dividends that have not been declared by our board of directors.
Stockholders of the Company have no contractual or other legal right to dividends that have not been declared by our board of directors. The availability of shares for future sale could adversely affect the market price of our common stock.
We are the tenant of a Ground Lease underlying a majority of our Doubletree Seattle Airport property.
Replacing a property operator may also result in significant disruptions at the affected hotels. ​ We are the tenant of a Ground Lease underlying a majority of our Doubletree Seattle Airport property.
If the credit rating of a counterparty were downgraded and we were unable to renegotiate the credit rating condition with the lender or find an alternative counterparty with acceptable credit rating, we would be in default under the loan and the lender could seize that property securing the loan through foreclosure.
If the credit rating of a counterparty were downgraded and we were unable to renegotiate the credit rating condition with the lender or find an alternative counterparty with acceptable credit rating, we would be in default under the loan and the lender could seize that property securing the loan through foreclosure. 20 Table of Contents Joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on partners’ or co-venturers’ financial position and liquidity and disputes between us and our co-venturers.
We cannot assure you that any expansion or acquisition opportunities or other strategic transactions, will be successful, or that we will realize our expected operating efficiencies, cost savings, revenue enhancements, synergies or other benefits. ​ 18 Table of Contents Risks Related to Our Relationship with Star Holdings We are party to several agreements with Star Holdings and may be unable to collect amounts to which we are contractually entitled, which could negatively affect our performance, financial condition, results of operations and cash flow.
Risks Related to Our Relationship with Star Holdings We are party to several agreements with Star Holdings and may be unable to collect amounts to which we are contractually entitled, which could negatively affect our performance, financial condition, results of operations and cash flow.
Additionally, Star Holdings has entered into a margin loan facility in an aggregate principal amount of $140.0 million with Morgan Stanley Bank, N.A., as lender, Morgan Stanley Senior Funding, Inc., as administrative agent, and Morgan Stanley & Co. LC, as sole custodian, calculation agent and collateral agent (the “Margin Loan Facility”).
Future sales in the public market by Star Holdings, or the perception in the market that Star Holdings intends to sell shares, could reduce the market price of our common stock. 18 Table of Contents Additionally, Star Holdings has entered into a margin loan facility in an aggregate principal amount of $140.0 million with Morgan Stanley Bank, N.A., as lender, Morgan Stanley Senior Funding, Inc., as administrative agent, and Morgan Stanley & Co.
Furthermore, we own a direct or indirect interest in certain subsidiaries that have elected to be taxed as REITs for U.S. federal income tax purposes under the Code. Provided that each subsidiary REIT qualifies as a REIT, our interest in such subsidiary REIT will be treated as a qualifying real estate asset for purposes of the REIT asset tests.
Our compliance with the REIT income and quarterly asset requirements also depends upon our ability to manage successfully the composition of our income and assets on an ongoing basis. Furthermore, we own a direct or indirect interest in certain subsidiaries that have elected to be taxed as REITs for U.S. federal income tax purposes under the Code.
Leasehold loans differ from our typical Ground Leases in that they are serviced by the post-ground rent cash flows of the asset and, in a default scenario, only have recourse to our tenants’ leasehold interests. ​ Our success depends in part on our ability to attract, retain and develop talented employees, and our failure to do so, including the loss of any of our key employees, could adversely impact our business.
We have also originated leasehold loans without a third-party partner. ​ Our success depends in part on our ability to attract, retain and develop talented employees, and our failure to do so, including the loss of any of our key employees, could adversely impact our business.
In addition, as of December 31, 2024, our portfolio had regional geographic concentrations based on gross book value (refer to “Our Portfolio” in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations). Percentage rent payable under our master lease relating to the Park Hotels Portfolio is calculated on an aggregate portfolio-wide basis.
If our Ground Lease tenants at such assets fail to re-tenant the building such Ground Leases may default and we may suffer losses. In addition, as of December 31, 2025, our portfolio had regional geographic concentrations based on gross book value (refer to “Our Portfolio” in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations).
Repurchase activity could have a negative effect on our stock price, increase volatility, or fail to enhance stockholder value. Tax Risks Related to Ownership of Our Shares Our failure to remain qualified as a REIT would subject us to taxes, which would reduce the amount of cash available for distribution to our shareholders.
Repurchase activity could have a negative effect on our stock price, increase volatility, or fail to enhance stockholder value. 25 Table of Contents Tax Risks Related to Ownership of Our Shares Legislative, regulatory or administrative changes could adversely affect us, our stockholders or holders of our debt.
Removed
Moreover, certain office assets currently have material vacancies. If our Ground Lease tenants at such assets fail to re-tenant the building such Ground Leases may default and we may suffer losses.
Added
We have entered into a forbearance agreement with a tenant under a significant New York office asset. If the tenant defaults on such agreement, we may experience delays in enforcing our rights as a landlord, may suffer losses and may incur substantial costs in protecting our investment. Moreover, certain office assets currently have material vacancies.
Removed
For one such asset, located in Washington D.C., we entered into a discretionary commitment to fund up to $9.0 million of preferred equity in an entity that owns the leasehold interest.
Added
Percentage rent payable under our master lease relating to the Park Hotels Portfolio is calculated on an aggregate portfolio-wide basis.

… 50 more changes not shown on this page.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

3 edited+0 added−0 removed4 unchanged
Biggest changeBoard members receive presentations on cybersecurity topics from our Head of IT, internal technology staff or external experts as part of the Board’s continuing education on topics that impact public companies. ​ Certain members of our management team, including the Head of Risk Management and our General Counsel, are responsible for assessing and managing our material risks from cybersecurity threats.
Biggest changeBoard members receive presentations on cybersecurity topics from our Head of IT, internal technology staff or external experts as part of the Board’s continuing education on topics that impact public companies. ​ Certain members of our management team, including our Head of IT who has more than 20 years experience in IT infrastructure and information security, are responsible for assessing and managing our material risks from cybersecurity threats.
This does not imply that we meet any particular technical standards, specifications, or requirements, only that we use the NIST CSF 2.0 as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business. ​ Our cybersecurity risk management program is integrated into our overall enterprise risk management program , and shares common methodologies, reporting channels and governance processes that apply across the enterprise risk management program to other legal, compliance, strategic, operational, and financial risk areas. ​ Our cybersecurity risk management program includes: ​ ● risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment; ● a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; ● the use of external service providers to assess, test or otherwise assist with aspects of our security controls ; ● cybersecurity awareness training of our employees, incident response personnel, and senior management; ● a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and ● a third-party risk management process for service providers, suppliers, and vendors. ​ We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. ​ Cybersecurity Governance ​ Our Board considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit Committee (the “Committee”) oversight of cybersecurity and other information technology risks.
This does not imply that we meet any particular technical standards, specifications, or requirements, only that we use the NIST CSF 2.0 as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business. ​ Our cybersecurity risk management program is integrated into our overall enterprise risk management program , and shares common methodologies, reporting channels and governance processes that apply across the enterprise risk management program to other legal, compliance, strategic, operational, and financial risk areas. ​ Our cybersecurity risk management program includes: ​ ● risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment; ● a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; ● the use of external service providers to assess, test or otherwise assist with aspects of our security controls ; 27 Table of Contents ● cybersecurity awareness training of our employees, incident response personnel, and senior management; ● a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; ● simulated cyber-attack and penetration attempts along with phishing tests; and ● a third-party risk management process for service providers, suppliers, and vendors. ​ We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. ​ Cybersecurity Governance ​ Our Board considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit Committee (the “Committee”) oversight of cybersecurity and other information technology risks.
These individuals have primary responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and our retained external cybersecurity consultants. ​ 29 Table of Contents Our management team supervises efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the IT environment. ​
These individuals have primary responsibility for our overall cybersecurity risk management program and supervise both our internal cybersecurity personnel and our retained external cybersecurity consultants. ​ Our management team supervises efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the IT environment. ​

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

2 edited+2 added−0 removed0 unchanged
Biggest changeItem 3. Legal Proceedings We are not currently party to any pending legal proceedings, nor is any property of the Company subject to any pending legal proceedings, that we believe could have a material adverse effect on our business or financial condition.
Biggest changeAlthough we believe our claims are meritorious, there are no assurances that we will prevail in our litigation. ​ We are not currently party to any other pending legal proceedings, nor is any property of the Company subject to any pending legal proceedings, that we believe could have a material adverse effect on our business or financial condition.
However, we may be subject to various claims and legal actions arising in the ordinary course of business from time to time. ​ Item 4. Mine Safety Disclosures Not applicable. PART II
However, we may be subject to various claims and legal actions arising in the ordinary course of business from time to time. 28 Table of Contents ​ Item 4. Mine Safety Disclosures Not applicable. PART II
Added
Item 3. Legal Proceedings On October 22, 2025, we sent the tenant under the Park Hotels master lease (“Park Tenant”) a termination notice for all five hotels and commenced litigation against the Park Tenant and Park Intermediate Holdings LLC, guarantor under the master lease, for certain breaches, among other things, related to the maintenance and operations of the hotels.
Added
The litigation is captioned In re Park Hotels Litigation, C.A. No. 2025-1210-LWW, pending in the Delaware Court of Chancery. The Park Tenant has disputed our right to terminate the lease, and that issue, among others, is subject to the litigation, which includes counterclaims filed by the Park Tenant.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

3 edited+0 added−0 removed4 unchanged
Biggest changeRepurchases may be suspended, terminated or modified at any time for any reason. The share repurchase program does not have an expiration date. Any repurchased shares shall be returned to the status of authorized but unissued shares of commons stock. ​ Item 6. RESERVED 30 Table of Contents
Biggest changeRepurchases may be suspended, terminated or modified at any time for any reason. The share repurchase program does not have an expiration date. Any repurchased shares shall be returned to the status of authorized but unissued shares of common stock. ​ Item 6. RESERVED ​ 29 Table of Contents
Unregistered Sales of Equity Securities We did not have any sales of unregistered shares of our common stock during the three months ended December 31, 2024. Issuer Purchases of Equity Securities We did not purchase any shares of our common stock during the three months ended December 31, 2024.
Unregistered Sales of Equity Securities We did not have any sales of unregistered shares of our common stock during the three months ended December 31, 2025. Issuer Purchases of Equity Securities We did not purchase any shares of our common stock during the three months ended December 31, 2025.
Item 5. Market for Registrant’s Equity, Related Stock Matters and Issuer Purchases of Equity Securities Our common stock trades on the NYSE under the symbol "SAFE." Computershare is the transfer agent and registrar for our common stock. We had 1,501 holders of record of common stock as of February 5, 2025.
Item 5. Market for Registrant’s Equity, Related Stock Matters and Issuer Purchases of Equity Securities Our common stock trades on the NYSE under the symbol "SAFE." Computershare is the transfer agent and registrar for our common stock. We had 1,431 holders of record of common stock as of February 10, 2026.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

66 edited+25 added−21 removed49 unchanged
Biggest changeBelow is an overview of the top 10 assets in our portfolio as of December 31, 2024 (based on gross book value and excluding unfunded commitments): (1) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Lease ​ ​ ​ ​ ​ ​ Property ​ ​ ​ Expiration / ​ Rent Escalation ​ % of Gross ​ Property Name Type Location As Extended Structure Book Value ​ 425 Park Avenue (2) Office New York, NY 2090 / 2090 Fixed with Inflation Adjustments 5.4 % 135 West 50th Street Office New York, NY 2123 / 2123 Fixed with Inflation Adjustments 4.7 % 195 Broadway Office New York, NY 2118 / 2118 Fixed with Inflation Adjustments 4.5 % 20 Cambridgeside ​ Life Science ​ Cambridge, MA ​ 2121 / 2121 ​ Fixed with Inflation Adjustments ​ 4.4 % Park Hotels Portfolio (3) Hotel Various 2025 / 2035 % Rent 3.3 % Alohilani Hotel Honolulu, HI 2118 / 2118 Fixed with Inflation Adjustments 3.3 % 685 Third Avenue Office New York, NY 2123 / 2123 Fixed with Inflation Adjustments 3.0 % 1111 Pennsylvania Avenue Office Washington, DC 2117 / 2117 Fixed with Inflation Adjustments 2.3 % 100 Cambridgeside ​ Mixed Use and Other ​ Cambridge, MA ​ 2121 / 2121 ​ Fixed with Inflation Adjustments ​ 2.2 % Columbia Center ​ Office ​ Washington, DC ​ 2120 / 2120 ​ Fixed with Inflation Adjustments ​ 2.2 % (1) Gross book value represents the historical purchase price plus accrued interest on sales-type leases.
Biggest changeAs of December 31, 2025, our estimated portfolio Ground Rent Coverage was 3.4x (see the "Risk Factors - Our estimated UCA, Combined Property Value and Ground Rent Coverage, may not reflect current market values, including the decline in office values, and may decline materially in future periods , - We rely on Property NOI as reported to us by our tenants, -Our estimates of Ground Rent Coverage for properties in development or transition, or for which we do not receive current tenant financial information, may prove to be incorrect " in this Form 10-K for a discussion of our estimated Ground Rent Coverage). 31 Table of Contents Below is an overview of the top 10 Ground Leases in our portfolio as of December 31, 2025 (based on gross book value and excluding unfunded commitments): (1) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Lease ​ ​ ​ ​ ​ ​ Property ​ ​ ​ Expiration / ​ Rent Escalation ​ % of Gross ​ Property Name ​ ​ ​ Type ​ ​ ​ Location ​ ​ ​ As Extended ​ ​ ​ Structure ​ ​ ​ Book Value ​ 425 Park Avenue (2) Office New York, NY 2090 / 2090 Fixed with Inflation Adjustments 5.3 % 135 West 50th Street Office New York, NY 2123 / 2123 Fixed with Inflation Adjustments 4.6 % 195 Broadway Office New York, NY 2118 / 2118 Fixed with Inflation Adjustments 4.4 % 20 Cambridgeside ​ Life Science ​ Cambridge, MA ​ 2121 / 2121 ​ Fixed with Inflation Adjustments ​ 4.3 % Alohilani Hotel Honolulu, HI 2118 / 2118 Fixed with Inflation Adjustments 3.2 % Park Hotels Portfolio (3) Hotel Various 2025 / 2035 % Rent 3.2 % 685 Third Avenue Office New York, NY 2123 / 2123 Fixed with Inflation Adjustments 2.9 % Columbia Center ​ Office ​ Washington, DC ​ 2120 / 2120 ​ Fixed ​ 2.2 % 1111 Pennsylvania Avenue Office Washington, DC 2117 / 2117 Fixed with Inflation Adjustments 2.2 % 100 Cambridgeside ​ Mixed Use and Other ​ Cambridge, MA ​ 2121 / 2121 ​ Fixed with Inflation Adjustments ​ 2.1 % (1) Gross book value represents the historical purchase price plus accrued interest on sales-type leases.
The value of the tangible assets, consisting of land, buildings, building improvements and tenant improvements is determined as if these assets are vacant, using estimated cash flow projections of the properties acquired which incorporate market rent, growth, discount and terminal capitalization rates.
The value of tangible assets, consisting of land, buildings, building improvements and tenant improvements is determined as if these assets are vacant, using estimated cash flow projections of the properties acquired which incorporate market rent, growth, discount and terminal capitalization rates.
Critical Accounting Estimates Allowance for credit losses on net investment in sales-type leases, Ground Lease receivables and loan receivable – related party— Effective January 1, 2023, upon the adoption of ASU 2016-13, we implemented procedures to estimate our allowance for credit losses on net investment in sales-type leases and Ground Lease receivables, including unfunded commitments, using a quantitative analysis to estimate expected loss rates for our portfolio of net investment in sales-type leases and Ground Lease receivables.
Critical Accounting Estimates Allowance for credit losses on net investment in sales-type leases, Ground Lease receivables, loan receivable – related party and loans receivable, net— Effective January 1, 2023, upon the adoption of ASU 2016-13, we implemented procedures to estimate our allowance for credit losses on net investment in sales-type leases and Ground Lease receivables, including unfunded commitments, using a quantitative analysis to estimate expected loss rates for our portfolio of net investment in sales-type leases and Ground Lease receivables.
Under the Commercial Paper Program, we may issue the commercial paper notes from time to time and intend to use the proceeds for general corporate purposes. The Commercial Paper Program is backed by our 2024 Unsecured Revolver (see below). As of December 31, 2024, we had no outstanding balance under the Commercial Paper Program.
Under the Commercial Paper Program, we may issue the commercial paper notes from time to time and intend to use the proceeds for general corporate purposes. The Commercial Paper Program is backed by our 2024 Unsecured Revolver (see below). As of December 31, 2025, we had no outstanding balance under the Commercial Paper Program.
During the year ended December 31, 2024, we recorded income tax expense of $3.4 million. The provision for income taxes consists of current federal and state income taxes in the amount of $1.1 million and deferred federal and state taxes in the amount of $2.3 million with respect to our TRS.
The provision for income taxes consists of current federal and state income taxes in the amount of $1.2 million and deferred federal and state taxes in the amount of $1.7 million with respect to our TRS. During the year ended December 31, 2024, we recorded income tax expense of $3.4 million.
If the 6.10% Notes are redeemed on or after January 1, 2034, the redemption price will be equal to 100% of the principal amount of the 6.10% Notes being redeemed, plus accrued and unpaid interest thereon to, but not including, the applicable redemption date. ​ 38 Table of Contents In November 2024, Portfolio Holdings (as issuer) and us (as guarantor) issued $400.0 million aggregate principal amount of the 5.65% Notes (together with the 2.80% Notes, the 2.85% Notes, the 3.98% Notes, the 5.15% Notes and the 6.10% Notes, the “Senior Notes”).
If the 6.10% Notes are redeemed on or after January 1, 2034, the 37 Table of Contents redemption price will be equal to 100% of the principal amount of the 6.10% Notes being redeemed, plus accrued and unpaid interest thereon to, but not including, the applicable redemption date. ​ In November 2024, Portfolio Holdings (as issuer) and us (as guarantor) issued $400.0 million aggregate principal amount of the 5.65% Notes (together with the 2.80% Notes, the 2.85% Notes, the 3.98% Notes, the 5.15% Notes and the 6.10% Notes, the “Senior Notes”).
Our primary sources of liquidity going forward will generally consist of cash on hand and cash flows from operations, new financings, funds from our joint venture partners, unused borrowing capacity under our 2024 Unsecured Revolver (subject to the conditions set forth in the applicable loan agreement) and Commercial Paper Program, and common and/or preferred equity issuances.
Our primary sources of liquidity going forward will generally consist of cash on hand and cash flows from operations, new financings, asset sales, funds from our joint venture partners, unused borrowing capacity under our 2024 Unsecured Revolver (subject to the conditions set forth in the applicable loan agreement) and Commercial Paper Program, and common and/or preferred equity issuances.
Actual sales, if any, will depend on a variety of factors to be determined by us from time to time, including, among other things, market conditions, the trading price of our common stock, capital needs, and our determinations of the appropriate sources of funding. As of December 31, 2024, we had not sold any shares under the ATM.
Actual sales, if any, will depend on a variety of factors to be determined by us from time to time, including, among other things, market conditions, the trading price of our common stock, capital needs, and our determinations of the appropriate sources of funding. As of December 31, 2025, we had not sold any shares under the ATM.
The tenant under our Park Hotels Portfolio elected to extend the leases underlying three of the five hotels past the initial lease maturity of December 2025 (see the "Risk Factors - We may be unable to renew expiring Ground Leases, re-lease the land or sell the properties on favorable terms or at all , - Percentage rent payable under our master lease relating to the Park Hotels Portfolio is calculated on an aggregate portfolio-wide basis , - We are the tenant of a Ground Lease underlying a majority of our Doubletree Seattle Airport property " in this Form 10-K for a discussion of our Park Hotels Portfolio).
The tenant under our Park Hotels Portfolio master lease elected to extend the leases underlying three of the five hotels past the initial lease maturity of December 2025 (see the "Risk Factors - We may be unable to renew expiring Ground Leases, re-lease the land or sell the properties on favorable terms or at all , - Percentage rent payable under our master lease relating to the Park Hotels Portfolio is calculated on an 30 Table of Contents aggregate portfolio-wide basis , - We are the tenant of a Ground Lease underlying a majority of our Doubletree Seattle Airport property " in this Form 10-K for a discussion of our Park Hotels Portfolio).
In addition, during the years ended December 31, 2024 and 2023, we also recorded $0.5 million and $0.5 million, respectively, of real estate expense relating to a Ground Lease in which we are the lessee but our tenant at the property pays this expense directly under the terms of a master lease.
In addition, during the years ended December 31, 2025 and 2024, we also recorded $0.5 million and $0.5 million, respectively, of real estate expense relating to a Ground Lease in which we are the lessee but our tenant at the property pays this expense directly under the terms of a master lease.
As of December 31, 2024, there was $1.3 billion of undrawn capacity on the 2024 Unsecured Revolver. ​ 2021 Unsecured Revolver—In March 2021, Portfolio Holdings, then known as Safehold Operating Partnership LP, (as borrower) and us (as guarantor), entered into an unsecured revolving credit facility with an initial maximum aggregate principal amount of up to $1.0 billion (the “2021 Unsecured Revolver”), which amount was increased to $1.35 billion in December 2021.
As of December 31, 2025, there was $1.2 billion of undrawn capacity on the 2024 Unsecured Revolver. ​ 2021 Unsecured Revolver—In March 2021, Portfolio Holdings, then known as Safehold Operating Partnership LP, (as borrower) and us (as guarantor), entered into an unsecured revolving credit facility with an initial maximum aggregate principal amount of up to $1.0 billion (the “2021 Unsecured Revolver”), which amount was increased to $1.35 billion in December 2021.
Many of our Ground Leases have CPI lookbacks, generally starting between years 11 and 21 of the lease term, to mitigate the effects of inflation that 31 Table of Contents are typically capped between 3.0% - 3.5%; however, in the event cumulative inflation growth for the lookback period exceeds the cap, these rent adjustments may not keep up fully with changes in inflation.
Many of our Ground Leases have CPI lookbacks, generally starting between years 11 and 21 of the lease term, to mitigate the effects of inflation that are typically capped between 3.0% - 3.5%; however, in the event cumulative inflation growth for the lookback period exceeds the cap, these rent adjustments may not keep up fully with changes in inflation.
The rise in interest rates has also adversely affected the U.S. office sector, along with office vacancies and a decline in market liquidity following the onset of the COVID-19 pandemic, all of which could negatively impact our tenants, Ground Rent Coverages and estimated Combined Property Values. Moreover, certain office assets currently have material vacancies.
The rise in interest rates has also adversely affected the U.S. office sector, along with office vacancies and a decline in market liquidity that began with the onset of the COVID-19 pandemic, all of which could negatively impact our tenants, Ground Rent Coverages and estimated Combined Property Values. Moreover, certain office assets currently have material vacancies.
The obligations of Portfolio Holdings to pay principal, premiums, if any, and interest on the Senior Notes are guaranteed on a senior basis by us. The guarantee is full and unconditional, and Portfolio Holdings is a consolidated subsidiary of ours.
The obligations of Portfolio Holdings to pay principal, premiums, if any, and interest on these unsecured senior notes are guaranteed on a senior basis by us. The guarantee is full and unconditional, and Portfolio Holdings is a consolidated subsidiary of ours.
As of December 31, 2024, there was $1.3 billion of undrawn capacity on the 2024 Unsecured Revolver. ​ In April 2023, we entered into an at-the-market equity offering (the “ATM”) pursuant to which we may sell shares of our common stock up to an aggregate purchase price of $300.0 million.
As of December 31, 2025, there was $1.2 billion of undrawn capacity on the 2024 Unsecured Revolver. ​ In April 2023, we entered into an at-the-market equity offering (the “ATM”) pursuant to which we may sell shares of our common stock up to an aggregate purchase price of $300.0 million.
We expect our long-term liquidity requirements to include debt service on our debt obligations (refer to Note 9 to the consolidated financial statements), distributions to our shareholders, working capital, new acquisitions and originations of Ground Lease investments (including in respect of unfunded commitments – refer to Note 10 to the consolidated financial statements) and debt maturities.
We expect our long-term liquidity requirements to include debt service on our debt obligations (refer to Note 10 to the consolidated financial statements), distributions to our shareholders, working capital, new acquisitions and originations of Ground Lease and leasehold loan investments (including in respect of unfunded commitments – refer to Note 11 to the consolidated financial statements) and debt maturities.
For a discussion of other significant accounting policies, refer to Note 3 to the consolidated financial statements. ​ 41 Table of Contents
For a discussion of other significant accounting policies, refer to Note 3 to the consolidated financial statements. ​ 40 Table of Contents
We continue to consider comparable loan to value ratios, loss rates, timing of losses, vintage, property type and other statistics in its estimate of credit losses.
We continue to consider comparable loan to value ratios, loss rates, timing of losses, 39 Table of Contents vintage, property type and other statistics in its estimate of credit losses.
As of December 31, 2024, the percentage breakdown of the gross book value of our portfolio was 41% multi-family, 40% office, 11% hotels, 6% life science and 2% mixed use and other. The diversification by geographic location, property type and sponsor in our portfolio further reduces risk and enhances potential upside.
As of December 31, 2025, the percentage breakdown of the gross book value of our portfolio was 42% multi-family, 39% office, 11% hotels, 6% life science and 2% mixed use and other. The diversification by geographic location, property type and sponsor in our portfolio further reduces risk and enhances potential upside.
In addition, the 2024 Unsecured Revolver contains customary affirmative and negative covenants. Among other things, these covenants may restrict us or certain of our subsidiaries’ ability to incur additional debt or liens, engage in certain mergers, consolidations and other fundamental changes, make other investments or pay dividends.
In addition, the 2024 38 Table of Contents Unsecured Revolver and 2025 Unsecured Revolver contain customary affirmative and negative covenants. Among other things, these covenants may restrict us or certain of our subsidiaries’ ability to incur additional debt or liens, engage in certain mergers, consolidations and other fundamental changes, make other investments or pay dividends.
Our discussion related to the results of operations and changes in financial condition for 2023 compared to 2022 is included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023 . These historical financial statements may not be indicative of our future performance. Merger Transaction On August 10, 2022, Safehold Inc.
Our discussion related to the results of operations and changes in financial condition for 2024 compared to 2023 is included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024 . These historical financial statements may not be indicative of our future performance.
The Federal Reserve has indicated that the economic outlook is uncertain and it will continue to monitor incoming data on unemployment and inflation before adjusting monetary policy; however, high interest rates have, and any future increase in interest rates may continue to result in a reduction in the availability or an increase in costs of leasehold financing for Ground Lease tenants, which is critical to the growth of a robust Ground Lease market.
The Federal Reserve has indicated that the economic outlook, which could include any potential impact on the economy from changes to U.S. trade policy, is uncertain and it will continue to monitor incoming data on unemployment and inflation before adjusting monetary policy; however, high interest rates have, and any future increase in interest rates may continue to result in a reduction in the availability or an increase in costs of leasehold financing for Ground Lease tenants, which is critical to the growth of a robust Ground Lease market.
In April 2023, we and Portfolio Holdings filed a registration statement on Form S-3 with the SEC registering, among other securities, debt securities of Portfolio Holdings, which will be fully and unconditionally guaranteed by us.
The amendments became effective on January 4, 2021. In April 2023, we and Portfolio Holdings filed a registration statement on Form S-3 with the SEC registering, among other securities, debt securities of Portfolio Holdings, which will be fully and unconditionally guaranteed by us.
Real estate expense during the years ended December 31, 2024 and 2023 was $4.2 million and $4.7 million, respectively, and consisted primarily of the amortization of an operating lease right-of-use asset, property taxes, legal fees, 34 Table of Contents property appraisal fees and insurance expense.
Real estate expense during the years ended December 31, 2025 and 2024 was $4.8 million and $4.2 million, respectively, and consisted primarily of the amortization of an operating lease right-of-use asset, property taxes, legal fees, property appraisal fees and insurance expense.
Other income for the years ended December 31, 2024 and 2023 also includes $0.5 million and $0.5 million, respectively, of other income relating to a Ground Lease in which we are the lessee but our tenant at the property pays this expense directly under the terms of a master lease and $3.6 million and $3.3 million, respectively, of other ancillary income from our investments and interest income earned on our cash balances. ​ During the year ended December 31, 2024, we incurred interest expense from our debt obligations of $198.0 million compared to $181.0 million during the year ended December 31, 2023.
Other income for the years ended December 31, 2025 and 2024 also includes $0.5 million and $0.5 million, respectively, of other income relating to a Ground Lease in which we are the lessee but our tenant at the property pays this expense directly under the terms of a master lease, and $4.0 million and $3.6 million, respectively, of other ancillary income from our investments and interest income earned on our cash balances.
The increase was due primarily to acquisitions of Ground Leases and additional fundings on existing Ground Leases classified as sales-type leases and Ground Lease receivables. Operating lease income decreased to $71.1 million during the year ended December 31, 2024 from $71.3 million for the year ended December 31, 2023.
The increase was due primarily to originations of Ground Leases and additional fundings on existing Ground Leases classified as sales-type leases and Ground Lease receivables. Operating lease income increased to $72.1 million during the year ended December 31, 2025 from $71.1 million for the year ended December 31, 2024.
Beginning in the third quarter of 2024, we enhanced our policy to inform credit loss estimates by analyzing historical loss data for high-credit rated long-duration bonds, which we believe have similar risk profiles to our Ground Leases, provided by external third parties along with the historical data provided by Trepp.
We also inform credit loss estimates by analyzing historical loss data for high-credit rated long-duration bonds, which we believe have similar risk profiles to our Ground Leases, provided by external third parties along with the historical data provided by Trepp.
We expect our short-term liquidity requirements to include debt service on our debt obligations (refer to Note 9 to the consolidated financial statements), distributions to our shareholders, working capital, new acquisitions and originations of Ground Lease investments.
We expect our short-term liquidity requirements to include debt service on our debt obligations (refer to Note 10 to the consolidated financial statements), distributions to our shareholders, working capital, new acquisitions and originations of Ground Lease and leasehold loan investments and additional fundings on existing Ground Leases and leasehold loan investments.
Capital appreciation is realized though appreciation in the value of the land over time and through our typical rights as landlord to acquire the commercial buildings on our land at the end of a Ground Lease, which may yield substantial value to us.
Growth is realized through long-term leases with contractual periodic increases in rent. Capital appreciation is realized though appreciation in the value of the land over time and through our typical rights as landlord to acquire the commercial buildings on our land at the end of a Ground Lease, which may yield substantial value to us.
As of December 31, 2024, we had $8 million of unrestricted cash. We also have an aggregate $1.3 billion of undrawn capacity on our 2024 Unsecured Revolver (refer to Note 9 to the consolidated financial statements).
As of December 31, 2025, we had $21.7 million of unrestricted cash. We also have an aggregate $1.2 billion of undrawn capacity on our 2024 Unsecured Revolver (refer to Note 10 to the consolidated financial statements).
The 2024 Unsecured Revolver has a borrowing rate of Adjusted SOFR, as defined in the applicable agreement, plus 0.85%, subject to our credit ratings, with an extended maturity date of May 1, 2029, which includes two six-month extension options. We also pay a facility fee of 0.10%, subject to our credit ratings.
As a result of that amendment, the 2024 Unsecured Revolver has a borrowing rate of SOFR plus 0.85%, subject to our credit ratings, with an extended maturity date of May 1, 2029, inclusive of two six-month extension options. We also pay a facility fee of 0.10%, subject to our credit ratings.
For asset acquisitions, we recognize and measure identifiable assets acquired, liabilities assumed and any noncontrolling interest in the acquiree based on their relative fair values and acquisition-related costs are capitalized and recorded in "Real estate, net," "Real estate-related intangible assets, net" and "Real estate-related intangible liabilities, net" on our consolidated balance sheets. 40 Table of Contents We account for our acquisition of properties by recording the purchase price of tangible and intangible assets and liabilities acquired based on their relative fair values.
For asset acquisitions, we recognize and measure identifiable assets acquired, liabilities assumed and any noncontrolling interest in the acquiree based on their relative fair values and acquisition-related costs are capitalized and recorded in "Real estate, net," "Real estate-related intangible assets, net" and "Real estate-related intangible liabilities, net" on our consolidated balance sheets.
Depreciation and amortization was $9.9 million and $9.9 million during the years ended December 31, 2024 and 2023, respectively, and primarily relates to our ownership of the Park Hotels Portfolio and a multi-family property , the amortization of in-place lease assets, and beginning in the second quarter of 2023, depreciation on corporate fixed assets acquired in the Merger.
Depreciation and amortization was $8.5 million and $9.9 million during the years ended December 31, 2025 and 2024, respectively. Depreciation and amortization primarily relates to our ownership of the Park Hotels Portfolio and a multi-family property, the amortization of in-place lease assets and depreciation of corporate fixed assets.
(2) Gross book value for this property represents our pro rata share of the gross book value of our unconsolidated venture (refer to Note 7 to the consolidated financial statements). (3) The Park Hotels Portfolio consists of five properties and is subject to a single master lease.
(2) Gross book value for this property represents our pro rata share of the gross book value of our unconsolidated venture (refer to Note 8 to the consolidated financial statements). (3) The Park Hotels Portfolio consists of five properties as of December 31, 2025 and is subject to a single master lease, but with individual asset extension rights.
Our Portfolio Our portfolio of properties is diversified by property type and region. Our portfolio is comprised of Ground Leases and a master lease (relating to five hotel assets that we refer to as our “Park Hotels Portfolio”) that has many of the characteristics of a Ground Lease.
Our portfolio is comprised of Ground Leases, leasehold loans and a master lease (relating to an initial five hotel assets that we refer to as our “Park Hotels Portfolio”) that has many of the characteristics of a Ground Lease.
We expect that we will be able to meet our liquidity requirements over the next 12 months and beyond. ​ The following table outlines our cash flows provided by operating activities, cash flows used in investing activities and cash flows provided by financing activities for the years ended December 31, 2024 and 2023 ($ in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended ​ ​ ​ December 31, ​ ​ 2024 2023 Cash flows provided by (used in) operating activities ​ $ 37,855 ​ $ 15,391 ​ Cash flows provided by (used in) investing activities ​ (212,370) ​ (576,572) ​ Cash flows provided by (used in) financing activities ​ 144,893 ​ 559,531 ​ ​ The increase in cash flows provided by operating activities during 2024 was due primarily to an increase in distributions received from equity method investments in 2024 and the payment of Merger expenses in 2023, which was partially offset by the payment of annual performance awards in 2024.
We expect that we will be able to meet our liquidity requirements over the next 12 months and beyond. ​ The following table outlines our cash flows provided by operating activities, cash flows used in investing activities and cash flows provided by financing activities for the years ended December 31, 2025 and 2024 ($ in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended ​ ​ ​ December 31, ​ ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ Cash flows provided by (used in) operating activities ​ $ 47,814 ​ $ 37,855 ​ Cash flows provided by (used in) investing activities ​ (237,178) ​ (212,370) ​ Cash flows provided by (used in) financing activities ​ 202,982 ​ 144,893 ​ ​ The increase in cash flows provided by operating activities during 2025 was due primarily to proceeds received from the settlement of derivatives, which was partially offset by a decrease in distributions from equity method investments.
The provision for credit losses was due primarily to enhancements to our general provision for credit loss methodology (refer to Note 3 to the consolidated financial statements), current market conditions and growth in the portfolio during the period. During the year ended December 31, 2023, we recorded a provision for credit losses of $2.7 million.
During the year ended December 31, 2024, we recorded a provision for credit losses of $9.5 million. The provision for credit losses was due primarily to enhancements to our general provision for credit loss methodology in the third quarter of 2024, current market conditions and growth in the portfolio during the period.
As of December 31, 2024, we were in compliance with all of our financial covenants. 39 Table of Contents Supplemental Guarantor Disclosure In March 2020, the Securities and Exchange Commission (“SEC”) adopted amendments to Rule 3-10 of Regulation S-X and created Rule 13-01 to simplify disclosure requirements related to certain registered securities. The amendments became effective on January 4, 2021.
Our mortgages contain no significant maintenance or ongoing financial covenants. As of December 31, 2025, we were in compliance with all of our financial covenants. Supplemental Guarantor Disclosure In March 2020, the Securities and Exchange Commission (“SEC”) adopted amendments to Rule 3-10 of Regulation S-X and created Rule 13-01 to simplify disclosure requirements related to certain registered securities.
(4) For the years ended December 31, 2024 and 2023, general and administrative expenses were partially offset by $16.8 million and $19.4 million, respectively, of management fees earned from Star Holdings, which are included in “Other income” in our consolidated statements of operations.
(2) For the years ended December 31, 2025 and 2024, general and administrative expenses were partially offset by $11.7 million and $16.8 million, respectively, of management fees earned from Star Holdings, which are included in “Other income” in our consolidated statements of operations. During the year ended December 31, 2025, we recorded a provision for credit losses of $6.6 million.
Debt Covenants —We are subject to financial covenants under the 2024 Unsecured Revolver, including maintaining: (i) a ratio of total unencumbered assets to total unsecured debt of at least 1.33x; and (ii) a consolidated fixed charge coverage ratio of at least 1.15x, as such terms are defined in the documents governing the 2024 Unsecured Revolver.
Debt Covenants —We are subject to financial covenants under the 2024 Unsecured Revolver and 2025 Unsecured Term Loan, including maintaining: (i) a ratio of total unencumbered assets to total unsecured debt of at least 1.25x; (ii) a consolidated fixed charge coverage ratio of at least 1.15x, as such terms are defined in the documents governing the 2024 Unsecured Revolver and 2025 Unsecured Term Loan, as applicable; and (iii) limiting the incurrence of any secured debt that would cause the Company’s secured debt to total assets ratio to exceed 50%.
We believe the strong credit profile we have established utilizing our modern Ground Leases and our current investment-grade credit ratings from Moody's Investors Services of A3, Fitch Ratings of A- and S&P Global Ratings of BBB+ facilitates our ability to bring commercial real estate owners, developers and sponsors more efficiently priced capital and allows us significant operational and financial flexibility and supports our ability to scale our Ground Lease platform.
We believe the strong credit profile we have established utilizing our modern Ground Leases and our current investment-grade credit ratings from Moody's Investors Services of A3, Fitch Ratings of A- and S&P Global Ratings of A- facilitates our ability to bring commercial real estate owners, developers and sponsors more efficiently priced capital and allows us significant operational and financial flexibility and supports our ability to scale our Ground Lease platform. ​ Also in November 2025, we closed on a $400.0 million unsecured term loan with an extended maturity date of November 15, 2030, inclusive of two one-year extension options (the “2025 Unsecured Term Loan”).
A majority of the land underlying one of these properties is owned by a third party and is ground leased to us through 2044 subject to changes in the CPI; however, our tenant at the property pays this cost directly to the third party. 32 Table of Contents The following tables show our portfolio by top 10 markets and property type as of December 31, 2024, excluding unfunded commitments: ​ ​ ​ ​ ​ ​ % of Gross Market Book Value ​ Manhattan (1) 22 % Washington, DC 10 ​ Boston 8 ​ Los Angeles 7 ​ San Francisco 4 ​ Denver ​ 4 ​ Honolulu ​ 3 ​ Nashville ​ 3 ​ Miami ​ 3 ​ Atlanta 2 ​ (1) Total New York MSA including areas outside of Manhattan makes up 28% of gross book value. ​ ​ ​ ​ ​ ​ ​ % of Gross Property Type Book Value ​ Multifamily 41 % Office 40 ​ Hotel 11 ​ Life Science ​ 6 ​ Mixed Use and Other 2 ​ ​ Unfunded Commitments We have unfunded commitments to certain of our Ground Lease tenants related to leasehold improvement allowances that we expect to fund upon the completion of certain conditions.
The following tables show our portfolio by top 10 markets and property type as of December 31, 2025, excluding unfunded commitments: ​ ​ ​ ​ ​ ​ % of Gross Market ​ ​ ​ Book Value ​ Manhattan (1) 21 % Washington, DC 10 ​ Boston 8 ​ Los Angeles 7 ​ San Francisco 4 ​ Denver ​ 4 ​ Honolulu ​ 3 ​ Nashville ​ 3 ​ Miami ​ 3 ​ Atlanta 2 ​ (1) Total New York metropolitan statistical area including areas outside of Manhattan makes up 27% of gross book value. ​ ​ ​ ​ ​ ​ ​ % of Gross Property Type ​ ​ ​ Book Value ​ Multifamily 42 % Office 39 ​ Hotel 11 ​ Life Science ​ 6 ​ Mixed Use and Other 2 ​ ​ Unfunded Commitments We have unfunded commitments to certain of our Ground Lease tenants related to leasehold improvement allowances that we expect to fund upon the completion of certain conditions.
The following table presents our general and administrative expenses for the years ended December 31, 2024 and 2023 ($ in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ December 31, ​ 2024 2023 Public company and other costs (1) ​ $ 41,160 ​ $ 37,015 Stock-based compensation (2) ​ 13,757 ​ 23,230 Management fees (3) ​ ​ — ​ ​ 5,199 Expense reimbursements to the former manager (3) ​ — ​ 3,125 Total general and administrative expenses (4) ​ $ 54,917 ​ $ 68,569 (1) For the years ended December 31, 2024 and 2023, public company and other costs primarily includes compensation, occupancy, audit, legal, insurance and other office related costs.
The following table presents our general and administrative expenses for the years ended December 31, 2025 and 2024 ($ in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended ​ ​ December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 Public company and other costs (1) ​ $ 41,788 ​ $ 41,160 Stock-based compensation ​ 12,549 ​ 13,757 Total general and administrative expenses (2) ​ $ 54,337 ​ $ 54,917 (1) For the years ended December 31, 2025 and 2024, public company and other costs primarily includes compensation, occupancy, audit, legal, insurance and other office related costs.
We believe owning a portfolio of Ground Leases affords our investors the opportunity for safe, growing income. Safety is derived from a Ground Lease’s senior position in the commercial real estate capital structure. Growth is realized through long-term leases with contractual periodic increases in rent.
Business Overview We acquire, manage and capitalize Ground Leases and report our business as a single reportable segment. We believe owning a portfolio of Ground Leases affords our investors the opportunity for safe, growing income. Safety is derived from a Ground Lease’s senior position in the commercial real estate capital structure.
As of December 31, 2024, Portfolio Holdings had issued and outstanding the Senior Notes, which were registered on the Form S-3 filed in April 2023 or on a Form S-3 filed by Old SAFE and Portfolio Holdings (then known as Safehold Operating Partnership LP).
As of December 31, 2025, Portfolio Holdings had issued and outstanding four tranches of unsecured senior notes with varying fixed-rates and maturities ranging from June 2031 to January 2035, which were registered on the Form S-3 filed in April 2023 or on a Form S-3 filed by Safehold Inc. and Portfolio Holdings (then known as Safehold Operating Partnership LP) prior to its merger with the Company (then known as iStar Inc.).
As of December 31, 2024, our mortgages are full term interest only, bear interest at a weighted average interest rate of 3.99% and have maturities between April 2027 and November 2069. 37 Table of Contents Unsecured Notes —In May 2021, Portfolio Holdings, then known as Safehold Operating Partnership LP, (as issuer) and the Company (as guarantor), issued $400.0 million aggregate principal amount of 2.80% senior notes due June 2031 (the “2.80% Notes”).
Unsecured Notes —In May 2021, Portfolio Holdings, then known as Safehold Operating Partnership LP, (as issuer) and the Company (as guarantor), issued $400.0 million aggregate principal amount of 2.80% senior notes due June 2031 (the “2.80% Notes”). The 2.80% Notes were issued at 99.127% of par.
The 2023 Unsecured Revolver accrued interest at a rate of Adjusted SOFR, as defined in the applicable agreement, plus 0.90%, subject to our credit ratings. The 2024 Unsecured Revolver replaced the 2023 Unsecured Revolver. Trust Preferred Securities —We assumed trust preferred securities from iStar in connection with Merger.
The 2023 Unsecured Revolver accrued interest at a rate of Adjusted SOFR, as defined in the applicable agreement, plus 0.90%, subject to our credit ratings. The 2024 Unsecured Revolver replaced the 2023 Unsecured Revolver. 2025 Unsecured Term Loan — In November 2025, Portfolio Holdings, as borrower, and us (as guarantor) entered into a $400.0 million unsecured term loan.
Other income for the years ended December 31, 2024 and 2023 primarily includes $16.8 million and $19.4 million, respectively, of management fees from Star Holdings and for the year ended December 31, 2023 includes $15.2 million of income due to a hedge forecasted for permanent debt that did not occur.
Other income for the years ended December 31, 2025 and 2024 primarily includes $11.7 million and $16.8 million, respectively, of management fees from Star Holdings.
We expect to make quarterly cash distributions to our shareholders sufficient to meet REIT qualification requirements.
We expect to make quarterly cash distributions to our shareholders sufficient to meet REIT qualification requirements. In November 2025, we received a credit ratings upgrade from S&P Global Ratings to A- (from BBB+).
The decrease in cash flows used in investing activities during 2024 was due primarily to the origination of the Star Holdings Term Loan Facility in 2023, consideration paid in connection with the Merger in 2023, a decrease in the funding of Ground Leases and an increase in net distributions received from equity method investments in 2024 and proceeds received from a derivative transaction in 2024.
The increase in cash flows used in investing activities during 2025 was due primarily to the origination of leasehold loans in 2025, a decrease in proceeds received from derivative transactions in 2025 and a decrease in distributions from equity method investments in 2025, which were all partially offset by a decrease in the origination of Ground Leases in 2025.
On February 4, 2025, our Board authorized the repurchase of up to $50.0 million of our common stock.
The 2025 Unsecured Term Loan also includes an accordion feature to increase the loan up to a maximum amount of $600.0 million, subject to certain conditions. ​ On February 4, 2025, our Board authorized the repurchase of up to $50.0 million of our common stock.
As of December 31, 2024, we had $119.6 million of such commitments. 33 Table of Contents Results of Operations for the Year Ended December 31, 2024 compared to the Year Ended December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended December 31, ​ ​ ​ ​ ​ 2024 ​ 2023 ​ $ Change ​ ​ (in thousands) Interest income from sales-type leases ​ $ 264,250 ​ $ 235,503 ​ $ 28,747 Operating lease income ​ ​ 71,061 ​ ​ 71,287 ​ ​ (226) Interest income - related party ​ ​ 9,482 ​ ​ 7,143 ​ ​ 2,339 Other income ​ 20,892 ​ 38,645 ​ (17,753) Total revenues ​ 365,685 ​ 352,578 ​ 13,107 Interest expense ​ 198,042 ​ 181,011 ​ 17,031 Real estate expense ​ 4,224 ​ 4,653 ​ (429) Depreciation and amortization ​ 9,947 ​ 9,936 ​ 11 General and administrative ​ 54,917 ​ 68,569 ​ (13,652) Impairment of goodwill ​ ​ — ​ ​ 145,365 ​ ​ (145,365) Provision for (recovery of) credit losses ​ ​ 9,489 ​ ​ 2,704 ​ ​ 6,785 Other expense ​ 1,983 ​ 17,862 ​ (15,879) Total costs and expenses ​ 278,602 ​ 430,100 ​ (151,498) Gain on sale of Ground Leases ​ ​ — ​ 447 ​ (447) Earnings (losses) from equity method investments ​ 22,977 ​ 24,229 ​ (1,252) Net income (loss) before income taxes ​ ​ 110,060 ​ ​ (52,846) ​ ​ 162,906 Income tax expense ​ ​ (3,445) ​ ​ (1,719) ​ ​ (1,726) Net income (loss) ​ $ 106,615 ​ $ (54,565) ​ $ 161,180 (1) For the years ended December 31, 2024 and 2023, general and administrative was partially offset by $16.8 million and $19.4 million, respectively, of management fees earned from Star Holdings, which are included in “Other income” in our consolidated statements of operations. ​ Interest income from sales-type leases increased to $264.3 million for the year ended December 31, 2024 from $235.5 million for the year ended December 31, 2023.
Results of Operations for the Year Ended December 31, 2025 compared to the Year Ended December 31, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended December 31, ​ ​ ​ ​ 2025 ​ 2024 ​ $ Change ​ (in thousands) Revenues: ​ ​ ​ ​ ​ ​ Interest income from sales-type leases $ 286,077 ​ $ 264,250 ​ $ 21,827 Operating lease income ​ 72,072 ​ ​ 71,061 ​ ​ 1,011 Interest income ​ 11,227 ​ ​ 9,482 ​ ​ 1,745 Other income 16,176 ​ 20,892 ​ (4,716) Total revenues 385,552 ​ 365,685 ​ 19,867 Costs and expenses: ​ ​ ​ ​ ​ Interest expense 206,686 ​ 198,042 ​ 8,644 Real estate expense 4,761 ​ 4,224 ​ 537 Depreciation and amortization 8,546 ​ 9,947 ​ (1,401) General and administrative (1) 54,337 ​ 54,917 ​ (580) Provision for (recovery of) credit losses ​ 6,564 ​ ​ 9,489 ​ ​ (2,925) Other expense 3,760 ​ 1,983 ​ 1,777 Total costs and expenses 284,654 ​ 278,602 ​ 6,052 Loss on early extinguishment of debt (2,224) ​ — ​ (2,224) Earnings (losses) from equity method investments 18,889 ​ 22,977 ​ (4,088) Net income (loss) before income taxes ​ 117,563 ​ ​ 110,060 ​ ​ 7,503 Income tax expense ​ (2,933) ​ ​ (3,445) ​ ​ 512 Net income (loss) $ 114,630 ​ $ 106,615 ​ $ 8,015 (1) For the years ended December 31, 2025, 2024 and 2023, general and administrative was partially offset by $11.7 million, $16.8 million and $19.4 million, respectively, of management fees earned from Star Holdings, which are included in “Other income” in our consolidated statements of operations. ​ Interest income from sales-type leases increased to $286.1 million for the year ended December 31, 2025 from $264.3 million for the year ended December 31, 2024.
We refer to these arrangements as performance-based commitments.
We refer to these arrangements as performance-based commitments. As of December 31, 2025, we had $154.8 million of such commitments.
At the time of termination, $916 million was drawn on the 2021 Unsecured Revolver, all of which rolled over into the 2024 Unsecured Revolver.
At the time of termination, $916 million was drawn on the 2021 Unsecured Revolver, all of which rolled over into the 2024 Unsecured Revolver. On September 12, 2025, we entered into an amendment to the 2024 Unsecured Revolver that modified the applicable interest rate thereunder by removing the credit spread adjustment to SOFR.
We may adopt alternative approaches to estimate our credit losses in the future based on factors such as, but not limited to, the loan to value ratios, property type and the availability of relevant historical market loss data for similar type financial instruments. ​ Real estate — Real estate assets are recorded at cost less accumulated depreciation and amortization, as follows: Purchase price allocation—Our acquisitions of properties are generally accounted for as an acquisition of assets.
We may adopt alternative approaches to estimate our credit losses in the future based on factors such as, but not limited to, the loan to value ratios, property type and the availability of relevant historical market loss data for similar type financial instruments. ​ We perform a quarterly analysis of our loans receivable that incorporates management’s current judgments about credit quality based on all known and relevant internal and external factors that may affect collectability.
The provision was primarily the result of the adoption of a new accounting standard (refer to Note 3 to the consolidated financial statements) in 2023, which resulted in a $2.4 million provision on our loan receivable, net – related party. During the year ended December 31, 2024, other expense consists primarily of costs related to our debt obligations.
During the year ended December 31, 2024 , other expense consists primarily of costs related to our debt obligations. During the year ended December 31, 2025, we recorded a $2.2 million loss on early extinguishment of debt in connection with the defeasance of $ 227.0 million principal amount of debt obligations (refer to Note 10 to the consolidated financial statements).
There can be no assurance that the conditions to closing for these transactions will be satisfied and that we will acquire the Ground Leases or fund the leasehold improvement allowances. ​ Through the Leasehold Loan Fund, we also fund construction and development loans and build-outs of space in real estate assets over a period of time if and when the borrowers and tenants meet established milestones and other performance criteria.
As of December 31, 2025, we had $142.3 million of such commitments, excluding commitments to be funded by noncontrolling interests. ​ 32 Table of Contents We also fund construction and development loans and build-outs of space in real estate assets over a period of time, both individually and through the Leasehold Loan Fund, if and when the borrowers and tenants meet established milestones and other performance criteria.
Borrowings under the Commercial Paper Program reduce amounts otherwise available under the 2024 Unsecured Revolver. In April 2024, we closed on a new $2.0 billion unsecured revolving credit facility (the “2024 Unsecured Revolver”), which replaced our 2021 Unsecured Revolver and 2023 Unsecured Revolver (refer to Note 9 to the consolidated financial statements), each of which were terminated.
Borrowings under the Commercial Paper Program reduce amounts otherwise available under the 2024 Unsecured Revolver. In April 2024, we closed on a $2.0 billion unsecured revolving credit facility (the “2024 Unsecured Revolver”). The 2024 Unsecured Revolver has an extended maturity date of May 1, 2029, inclusive of two six-month extension options.
The 2024 Unsecured Revolver has a borrowing rate of Adjusted SOFR, as defined in the applicable agreement, plus 0.85%, subject to our credit ratings, 36 Table of Contents with an extended maturity date of May 1, 2029, which includes two six-month extension options.
The 2025 Unsecured Term Loan has a borrowing rate of SOFR plus 0.90%, subject to our credit ratings, with an extended maturity date of November 15, 2030, inclusive of two one-year extension options.
During the year ended December 31, 2023, we recorded income tax expense of $1.7 million. The income tax expense was primarily the result of current federal and state income tax expense in the amount of $3.1 million, which was partially offset by a deferred tax benefit in the amount of $1.3 million with respect to our TRS.
The provision for income taxes consists of current federal and state income taxes in the amount of $1.1 million and deferred federal and state taxes in the amount of $2.3 million with respect to our TRS.
Mortgages —Mortgages consist of asset specific non-recourse borrowings that are secured by our real estate and Ground Leases.
The increase in cash flows provided by financing activities during 2025 was due primarily to net cash used in 2024 for the acquisition and redemption of noncontrolling interests and the payment of finance costs. Mortgages —Mortgages consist of asset specific non-recourse borrowings that are secured by our real estate and Ground Leases.
If our Ground Lease tenants at such assets fail to re-tenant the building such Ground Leases may default and we may suffer losses. See the "Risk Factors" section of this 10-K for additional discussion of certain potential risks to our business related to competition and industry concentrations .
See the "Risk Factors" section of this 10-K for additional discussion of certain potential risks to our business related to competition and industry concentrations. ​ On January 1, 2026, we became responsible for operating two hotel properties that reverted to us. We have not previously operated any hotel properties.
Operating lease income consists of rent from our operating leases and percentage rent from certain properties, including our Park Hotels Portfolio. Interest income – related party was $9.5 million and $7.1 million for the years ended December 31, 2024 and 2023, respectively, and relates to the Star Holdings Term Loan Facility that was originated on March 31, 2023.
Interest income was $11.2 million and $9.5 million for the years ended December 31, 2025 and 2024, respectively, and relates to the Star Holdings Term Loan Facility and leasehold loans we originated during the year ended December 31, 2025 in connection with Ground Leases. The increase in 2025 was due primarily to the origination and funding of leasehold loans.
To combat the increase in inflation, the Federal Reserve raised interest rates and has kept interest rates generally high. This increase in interest rates has produced progress on inflation and in September 2024, the Federal Reserve reduced the federal funds rate by 50 basis points, which marked the first interest rate cut in four years.
To combat the increase in inflation over the past few years, the Federal Reserve raised interest rates and has kept interest rates generally high, although recently they began to reduce rates.
During the year ended December 31, 2023 , other expense consists primarily of legal and consulting costs, transfer taxes associated with the Merger (refer to Note 1 to the consolidated financial statements) and $1.9 million from the derecognition of previously-capitalized deal structuring costs.
During the year ended December 31, 2025, other expense consists primarily of a full write-off of a $1.9 million preferred equity investment in an entity that owned the leasehold interest under one of our Ground Leases (refer to Note 15 to the consolidated financial statements) and costs related to our debt obligations.
Subsequent to the Merger closing on March 31, 2023, general and administrative expenses primarily includes public company costs such as compensation (including equity-based compensation), occupancy and other costs.
The decrease in 2025 was primarily the result of the tenant under our Park Hotels Portfolio electing to extend the leases underlying three of the five hotels under the lease past the initial lease maturity of December 2025. General and administrative expense primarily includes public company costs such as compensation (including equity-based compensation), occupancy and other costs.
Removed
(“Old SAFE”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with iStar Inc. (“iStar”), and on March 31, 2023, the Merger was completed in accordance with the terms of the Merger Agreement.
Added
If our Ground Lease tenants at such assets fail to re-tenant the building, such Ground Leases may default and we may suffer losses. We have entered into a forbearance agreement with a tenant under a significant New York office asset.
Removed
For accounting purposes, the Merger was accounted for as a business combination using the acquisition method of accounting under Accounting Standards Codification (“ASC”) 805, Business Combinations (“ASC 805”) and treated as a “reverse acquisition” in which iStar is considered the legal acquirer and Old SAFE is considered the accounting acquirer.
Added
If the tenant defaults on such agreement, we may experience delays in enforcing our rights as a landlord, may suffer losses and may incur substantial costs in protecting our investment.
Removed
The Company considered the following relevant facts for this determination: ● At the time of the Merger closing, Old SAFE shareholders, excluding the Old SAFE shares held directly by iStar, members of iStar management and Star Holdings, controlled a majority of the voting interests in the Company and the combined company operates under the name “Safehold Inc.;” ● The composition of the combined company’s board of directors, which includes three directors from Old SAFE, two directors from iStar, and two management members of both Old SAFE and iStar; ● Old SAFE was the larger entity by size when comparing the key metrics of total assets, total revenue and net income (loss) from continuing operations and allocable to common shareholders; and ● Substantially all of the assets and liabilities of the Company consist of the historical assets and liabilities of Old SAFE, and the go-forward business plan of the Company is to conduct the Ground Lease business conducted by Old SAFE prior to the Merger. ​ As a result, the historical financial statements of Old SAFE became the historical financial statements of Safehold Inc.
Added
We expect that going forward we will have revenues and expenses associated with room occupancy, food and beverage services and other ancillary income and expenses from hotel operations. ​ Our Portfolio Our portfolio of properties is diversified by property type and region.
Removed
Unless the context otherwise requires, references to “iStar” refer to iStar prior to the Merger, and references to “we,” “our” and “the Company” refer to the business and operations of Old SAFE and its consolidated subsidiaries prior to the Merger and to Safehold Inc. (formerly known as iStar Inc.) and its consolidated subsidiaries following the consummation of the Merger.
Added
On October 22, 2025, we sent the tenant under the Park Hotels master lease a termination notice for all five hotels and commenced litigation against our tenant and Park Intermediate Holdings LLC, guarantor under the master lease, for certain breaches, among other things, related to the maintenance and operations of the hotels.
Removed
Periods presented prior to the Merger date of March 31, 2023 reflect the operations of Old SAFE and periods subsequent to March 31, 2023 represent the financial statement of the Company. ​ Immediately before the closing of the Merger, iStar separated its remaining legacy non-ground lease assets and businesses, approximately $50.0 million of cash, exclusive of working capital reserves and restricted cash, and approximately 13.5 million shares of Old SAFE common stock into Star Holdings by distributing to iStar’s stockholders, on a pro rata basis, the issued and outstanding equity interests of Star Holdings (the “Spin-Off”). ​ Business Overview We acquire, manage and capitalize Ground Leases and report our business as a single reportable segment.
Added
There are no assurances that we will be able to terminate the master lease or prevail in our litigation.
Removed
The Federal Reserve further reduced the federal funds rate by 25 basis points in each of November 2024 and December 2024.
Added
A majority of the land underlying one of these properties is owned by a third party and is ground leased to us through 2044 subject to changes in the CPI; however, our tenant at the property pays this cost directly to the third party.
Removed
As of December 31, 2024, our estimated portfolio Ground Rent Coverage was 3.5x (see the "Risk Factors - Our estimated UCA, Combined Property Value and Ground Rent Coverage, may not reflect current market values, including the decline in office values, and may decline materially in future periods , - We rely on Property NOI as reported to us by our tenants, -Our estimates of Ground Rent Coverage for properties in development or transition, or for which we do not receive current tenant financial information, may prove to be incorrect " in this Form 10-K for a discussion of our estimated Ground Rent Coverage).
Added
The tenant under the Park Hotels master lease elected to extend the leases underlying three of the five hotels past the initial lease maturity of December 2025.

… 32 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+0 added−0 removed6 unchanged
Biggest changeEstimated Change In Net Income ($ in thousands) (1) ​ ​ ​ ​ Change in Interest Rates Net Income (Loss) -100 Basis Points ​ $ 2,556 -50 Basis Points ​ ​ 1,278 -10 Basis Points ​ ​ 256 Base Interest Rate ​ — +10 Basis Points ​ (256) + 50 Basis Points ​ (1,278) +100 Basis Points ​ (2,556) ​ (1) The table above includes the effect of interest rate swaps and our share of the impact of floating-rate loans in our Leasehold Loan Fund. ​ 42 Table of Contents
Biggest changeEstimated Change In Net Income ($ in thousands) (1) ​ ​ ​ ​ Change in Interest Rates ​ ​ ​ Net Income (Loss) -100 Basis Points ​ $ 7,656 -50 Basis Points ​ ​ 3,756 -10 Basis Points ​ ​ 703 Base Interest Rate ​ — +10 Basis Points ​ (703) + 50 Basis Points ​ (3,516) +100 Basis Points ​ (6,985) ​ (1) The table above includes the effect of our floating-rate debt obligations, interest rate swaps, floating-rate loans receivable and our share of the impact of floating-rate loans in our Leasehold Loan Fund. ​ 41 Table of Contents
As of December 31, 2024, we had $3.6 billion principal amount of fixed-rate debt outstanding and $789 million principal amount of floating-rate debt outstanding.
As of December 31, 2025, we had $3.4 billion principal amount of fixed-rate debt outstanding and $1.3 billion principal amount of floating-rate debt outstanding.

Other SAFE 10-K year-over-year comparisons