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What changed in BRT Apartments Corp.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of BRT Apartments Corp.'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.

+138 added−141 removedSource: 10-K (2026-03-13) vs 10-K (2025-03-12)

Top changes in BRT Apartments Corp.'s 2025 10-K

138 paragraphs added · 141 removed · 108 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

8 edited+8 added−0 removed26 unchanged
Biggest changeIf the shared services agreement is terminated or the executives performing Services are unwilling to continue to do so, we will have to obtain such services from other sources or hire employees to perform them.
Biggest changeIf the shared services agreement is terminated, the executives performing Services are unwilling to continue to do so, or if we are dissatisfied with the services provided pursuant to these arrangements, we will have to obtain such services from other sources or hire personnel to perform them.
Certain provisions of the Maryland General Corporation Law (the “MGCL”) may impede a third party from making a proposal to acquire us or inhibit a change of control under circumstances that otherwise could be in the best interest of holders of shares of our common stock, including: 22 Table of Contents • “business combination” provisions that, subject to certain exceptions and limitations, prohibit certain business combinations between us and an “interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our outstanding voting stock or an affiliate or associate of BRT who, at any time within the two-year period immediately prior to the date in question, was the beneficial owner of 10% or more of the voting power of our then outstanding voting stock) or an affiliate thereof for five years after the most recent date on which the stockholder becomes an interested stockholder, and thereafter impose two super-majority stockholder voting requirements on these combinations; • “control share” provisions that provide that, subject to certain exceptions, holders of “control shares” of BRT (defined as voting shares which, when aggregated with other shares controlled by the stockholder, entitle the holder to exercise voting power in the election of directors within one of three increasing ranges) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of issued and outstanding “control shares,” subject to certain exceptions) have no voting rights with respect to the control shares except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares; and • additionally, Title 3, Subtitle 8 of the MGCL permits our board of directors, without stockholder approval and regardless of what is currently provided in the Charter or the Bylaws, to implement certain corporate governance provisions.
Certain provisions of the Maryland General Corporation Law (the “MGCL”) may impede a third party from making a proposal to acquire us or inhibit a change of control under circumstances that otherwise could be in the best interest of holders of shares of our common stock, including: • “business combination” provisions that, subject to certain exceptions and limitations, prohibit certain business combinations between us and an “interested stockholder” (defined generally as any person who beneficially owns 22 Table of Contents 10% or more of the voting power of our outstanding voting stock or an affiliate or associate of BRT who, at any time within the two-year period immediately prior to the date in question, was the beneficial owner of 10% or more of the voting power of our then outstanding voting stock) or an affiliate thereof for five years after the most recent date on which the stockholder becomes an interested stockholder, and thereafter impose two super-majority stockholder voting requirements on these combinations; • “control share” provisions that provide that, subject to certain exceptions, holders of “control shares” of BRT (defined as voting shares which, when aggregated with other shares controlled by the stockholder, entitle the holder to exercise voting power in the election of directors within one of three increasing ranges) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of issued and outstanding “control shares,” subject to certain exceptions) have no voting rights with respect to the control shares except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares; and • additionally, Title 3, Subtitle 8 of the MGCL permits our board of directors, without stockholder approval and regardless of what is currently provided in the Charter or the Bylaws, to implement certain corporate governance provisions.
As a result, the acquisition by each of four other individuals of 6.0% of our outstanding common stock, when combined with the ownership of our common stock of Gould Investors, Fredric H. Gould, Matthew J. Gould and Jeffrey A. Gould, generally would not result in a violation of the Five or Fewer Limit.
As a result, the acquisition by each of four other individuals of 6% of our outstanding common stock, when combined with the ownership of our common stock of Gould Investors, Fredric H. Gould, Matthew J. Gould and Jeffrey A. Gould, generally would not result in a violation of the Five or Fewer Limit.
Any loss of this information or unauthorized distribution of funds as a result of a breach of information technology systems may result in loss of funds to which we are entitled, legal liability and costs (including damages and penalties), as well as damage to our reputation, that could materially and adversely affect our business and financial performance. 24 Table of Contents
Any loss of this information or unauthorized distribution of funds as a result of a breach of information technology systems may result in loss of funds to which we are entitled, legal liability and costs (including damages and penalties), as well as damage to our reputation, that could materially and adversely affect our business and financial performance.
Gould, or their affiliates, acquire additional shares or our stock, or any other event occurs (including a repurchase of shares of our stock), that results in an individual beneficially or constructively owning 26.0% or more of the outstanding shares of our stock within the meaning of the Charter, the acquisition by four other individuals of 6.0% or less of our outstanding stock would violate the Five or Fewer Limit and, therefore, could cause the stock acquired by one or more of these other individuals to be transferred to the charitable trust, despite their compliance with the 6.0% ownership limits.
Gould, or their affiliates, acquire additional shares or 23 Table of Contents our stock, or any other event occurs (including a repurchase of shares of our stock), that results in an individual beneficially or constructively owning 24.0% or more of the outstanding shares of our stock within the meaning of the Charter, the acquisition by four other individuals of 6.0% or less of our outstanding stock would violate the Five or Fewer Limit and, therefore, could cause the stock acquired by one or more of these other individuals to be transferred to the charitable trust, despite their compliance with the 6.0% ownership limits.
We may not be able to replace these services or hire such employees in a timely manner or on terms, including cost and level of expertise, that are equivalent to or better than those we receive pursuant to the Services and the shared services agreement.
We may not be able to replace these services or hire such employees in a timely manner or on terms that are equivalent to or better than those we receive pursuant to the Services and the shared services agreement.
However, there is no limitation on Gould Investors, 23 Table of Contents Fredric H. Gould, Matthew J. Gould or Jeffrey A.
However, there is no limitation on Gould Investors, Fredric H. Gould, Matthew J. Gould or Jeffrey A.
Based on information supplied to us, as of December 31, 2024, Gould Investors owns approximately 20.5% of the outstanding shares of common stock and, by virtue of the applicable attribution rules under the Code, these individuals beneficially own approximately 24.9% of outstanding shares of common stock.
Based on information supplied to us, as of December 31, 2025, Gould Investors owns approximately 21.6% of the outstanding shares of common stock and, by virtue of the applicable attribution rules under the Code, these individuals beneficially own approximately 26.4% of outstanding shares of common stock.
Added
Artificial intelligence and other machine learning techniques could increase competitive, operational, legal and regulatory risks to our business in ways that we cannot predict. The use of artificial intelligence (“AI”) by us and others, and the overall adoption of AI throughout society, may exacerbate or create new and unpredictable competitive, operational, legal and regulatory risks to our business.
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There is substantial uncertainty about the extent to which AI will result in dramatic changes throughout the world, and we may not be able to anticipate, prevent, mitigate or remediate all of the potential risks, challenges or impacts of such changes. These changes could 24 Table of Contents potentially disrupt, among other things, our business and operational processes.
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Our competitors may be more successful than us in the development and implementation of services and platforms based on AI to improve their operations. If we are unable to adequately use AI, or do so at a slower pace than others in our industry, we will be at a competitive disadvantage.
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If the data we, or third parties whose services we rely on and over whom we have limited oversight, use in connection with the possible development or deployment of AI is incomplete, inadequate or biased in some way, the performance of our business could suffer.
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Data in technology that uses AI may contain a degree of inaccuracy and error, which could result in in flawed decision-making on our part or the part of our property managers and other service providers.
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This could reduce the effectiveness of AI technologies and adversely impact us and our operations to the extent that we rely on the AI's work product.
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There is also a risk that we or our service providers may improperly disclose confidential information, including material non-public information or personally identifiable information, into AI applications, resulting in such information becoming a part of a dataset that is accessible by third parties.
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Our and our service providers use of AI may require compliance with legal or regulatory frameworks that are not fully developed or tested, and we may face litigation and regulatory actions related to our or our service providers use of AI.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

39 edited+2 added−7 removed75 unchanged
Biggest changeThe disposition of our properties or assets at below our carrying value may adversely affect our net income, reduce our stockholders’ equity and adversely affect our ability to pay dividends. 17 Table of Contents We may not have sufficient funds to make required or desired capital improvements. Our multi-family properties face competition from newer and updated properties.
Biggest changeWe may not have sufficient funds to make required or desired capital improvements. Our multi-family properties face competition from newer and updated properties. At December 31, 2025 the weighted average age (based on the number of units) of our multi-family properties is approximately 22 years.
These conditions include: • changes in national, regional and local economic conditions, which may be negatively impacted by concerns about inflation, deflation, government deficits, unemployment rates and decreased consumer confidence particularly in markets in which we have a high concentration of properties; • increases in interest rates, which could adversely affect our ability to obtain financing or to buy or sell properties on favorable terms or at all; • the inability of tenants to pay rent; • the existence and quality of the competition, such as the attractiveness of our properties as compared to our competitors' properties based on considerations such as convenience of location, rental rates, amenities and safety record; • increased operating costs, including increased real property taxes, maintenance, insurance and utility costs (including increased prices for fossil fuels); • weather conditions that may increase or decrease energy costs and other weather-related expenses; • oversupply of apartments or single-family housing or a reduction in demand for real estate in the markets in which our properties are located; • a favorable interest rate environment that may result in a significant number of residents or potential residents of our multi-family properties deciding to purchase homes instead of renting; • changes in, or increased costs of compliance with, laws and/or governmental regulations, including those governing usage, zoning, the environment and taxes; and • rent control or stabilization laws, or other laws regulating rental housing, which could prevent us from raising rents to offset increases in operating costs.
These conditions include: • changes in national, regional and local economic conditions, which may be negatively impacted by concerns about inflation, deflation, government deficits, unemployment rates and decreased consumer confidence particularly in markets in which we have a high concentration of properties; • increases in interest rates, which could adversely affect our ability to obtain financing or to buy or sell properties on favorable terms or at all; • the inability of tenants to pay rent; • the existence and quality of the competition, such as the attractiveness of our properties as compared to our competitors' properties based on considerations such as convenience of location, rental rates, amenities and safety record; • increased operating costs, including increased real property taxes, maintenance, insurance and utility costs (including increased prices for fossil fuels); • weather conditions that may increase or decrease energy costs and other weather-related expenses; • oversupply of competitive housing opportunities, including apartments or single-family housing, or a reduction in demand for real estate in the markets in which our properties are located; • a favorable interest rate environment that may result in a significant number of residents or potential residents of our multi-family properties deciding to purchase homes instead of renting; • changes in, or increased costs of compliance with, laws and/or governmental regulations, including those governing usage, zoning, the environment and taxes; and • rent control or stabilization laws, or other laws regulating rental housing, which could prevent us from raising rents to offset increases in operating costs.
Joint venture investments involve risks not otherwise present when acquiring real estate directly, including the following: • our joint venture partners may have economic or business interests or objectives which are or become inconsistent with our business interests or objectives, including differing objectives relating to the sale or refinancing of properties held by the joint venture or the timing of the termination or liquidation of the joint venture; • the more successful a joint venture project, the more likely that profits or distributions generated above a negotiated threshold will be allocated disproportionately in favor of our joint venture partner at a rate greater than that implied by our partner's equity interest in the venture; • several of our joint venture partners have other competing real estate interests in the markets in which our properties are located that could influence such partners to take actions favoring their properties to the detriment of the jointly owned properties; • our joint venture partners obtain blanket property casualty and business interruption insurance insuring properties we own jointly and other properties in which we have no ownership interest and as a result, claims or losses with respect to properties owned by our joint venture partners but in which we have no interest could significantly reduce or eliminate the insurance available to properties in which we have an interest; • our joint venture partner might become bankrupt, insolvent or otherwise refuse or be unable to meet their obligations to us or the venture (including their obligation to make capital contributions or property distributions when due); • we may incur liabilities as a result of action taken by our joint venture partner; • our joint venture partner may not perform its property oversight responsibilities; • our joint venture partner may be in a position to take action or withhold consent contrary to our instructions or requests, including actions that may make it more difficult to maintain our qualification as a REIT; • our joint venture partner might engage in unlawful or fraudulent conduct with respect to our jointly owned properties or other properties in which they have an ownership interest; • changes in personnel managing our joint venture partners have resulted in greater difficulty in working with the new personnel; • our joint venture partner may trigger a buy-sell arrangement, which could cause us to sell our interest, or acquire our partner's interest, at a time when we otherwise would not have initiated such a transaction; • disputes between us and our joint venture partners may result in litigation or arbitration that would increase our expenses and divert management's attention from operating our business; and • disagreements with our joint venture partners with respect to property management (including with respect to whether a property should be sold, refinanced, or improved) could result in an impasse resulting in the inability to operate the property effectively.
Joint venture investments involve risks not otherwise present when acquiring real estate directly, including the following: • our joint venture partners may have economic or business interests or objectives which are or become inconsistent with our business interests or objectives, including differing objectives relating to the sale or refinancing of properties held by the joint venture or the timing of the termination or liquidation of the joint venture; • the more successful a joint venture project, the more likely that profits or distributions generated above a negotiated threshold will be allocated disproportionately in favor of our joint venture partner at a rate greater than that implied by our partner's equity interest in the venture; • several of our joint venture partners have other competing real estate interests in the markets in which our properties are located that could influence such partners to take actions favoring their properties to the detriment of the jointly owned properties; • our joint venture partners obtain blanket property casualty and business interruption insurance insuring properties we own jointly and other properties in which we have no ownership interest and as a result, claims or losses with respect to properties owned by our joint venture partners but in which we have no interest could significantly reduce or eliminate the insurance available to properties in which we have an interest; • our joint venture partner might become bankrupt, insolvent or otherwise refuse or be unable to meet their obligations to us or the venture (including their obligation to make capital contributions or property distributions when due); • we may incur liabilities as a result of action taken by our joint venture partner; • our joint venture partner may not perform properly its property oversight responsibilities; • our joint venture partner may be in a position to take action or withhold consent contrary to our instructions or requests, including actions that may make it more difficult to maintain our qualification as a REIT; • our joint venture partner might engage in unlawful or fraudulent conduct with respect to our jointly owned properties or other properties in which they have an ownership interest; • changes in personnel managing our joint venture partners have resulted in greater difficulty in working with the new personnel; • our joint venture partner may trigger a buy-sell arrangement, which could cause us to sell our interest, or acquire our partner's interest, at a time when we otherwise would not have initiated such a transaction; 15 Table of Contents • disputes between us and our joint venture partners may result in litigation or arbitration that would increase our expenses and divert management's attention from operating our business; and • disagreements with our joint venture partners with respect to property management (including with respect to whether a property should be sold, refinanced, or improved) could result in an impasse resulting in the inability to operate the property effectively.
If the costs associated with real estate taxes, utilities and insurance premiums should rise, without being offset by a corresponding increase in revenues, our results of operations could be negatively impacted, and our ability to make payments on our debt and to make distributions could be adversely affected.
If the costs associated with real estate taxes, utilities and insurance premiums should rise, without being offset by a corresponding increase in revenues, our results of operations could be negatively impacted, and our ability to make payments on our debt and to make distributions would be adversely affected.
Should our access to financing provided through Fannie Mae and Freddie Mac loan programs be reduced or impaired, it would significantly reduce our access to debt capital and/or increase borrowing costs and could significantly limit our ability to acquire properties on acceptable terms and reduce the values to be realized upon property sales.
Should access to financing provided through Fannie Mae and Freddie Mac loan programs be reduced or impaired, it would significantly reduce our access to debt capital and/or increase borrowing costs and would significantly limit our ability to acquire properties on acceptable terms and reduce the values to be realized upon property sales.
If we do not continue to pay cash dividends, the price of our common stock will decline. Our business and operations are subject to physical and transition risks related to climate change. Several of our multi-family properties are located along or near coastal areas that have historically been subject to the risk of extreme weather events.
If we do not continue to pay cash dividends, the price of our common stock may decline. Our business and operations are subject to physical and transition risks related to climate change. Several of our multi-family properties are located along or near coastal areas that have historically been subject to the risk of extreme weather events.
Compliance or failure to comply with the ADA or other safety regulations and requirements could result in substantial costs. The ADA generally requires that public buildings, including the public areas at our properties, be made accessible to disabled persons. Non-compliance could result in the imposition of fines by governmental authorities or the award of damages to private litigants.
Compliance or failure to comply with the ADA or other safety regulations and requirements could result in substantial costs. The ADA generally requires that the public areas at our properties be made accessible to disabled persons. Non-compliance could result in the imposition of fines by governmental authorities or the award of damages to private litigants.
The concentration of our properties in the Southeast United States 13 Table of Contents and Texas exposes us to risks of adverse developments which are greater than the risks of owning properties with a more geographically diverse portfolio. The failure of property management companies to properly manage our properties could adversely impact our results of operations.
The concentration of our properties in the Southeast United States 14 Table of Contents and Texas exposes us to risks of adverse developments which are greater than the risks of owning properties with a more geographically diverse portfolio. The failure of property management companies to properly manage our properties could adversely impact our results of operations.
Principal factors of competition include rent or price charged, attractiveness of the location of multi-family properties, and the quality and breadth of services. The number of competitive properties relative to demand in a particular area has a material effect on our ability to lease our properties and on the rents we charge.
Principal factors of competition include rent or price charged, attractiveness of the location of multi-family properties, and the quality and breadth of services. The number of competitive properties relative to demand in a particular area has a material effect on our ability to lease our properties, on the rents we charge and our occupancy levels.
Our inability to reconfigure our portfolio to profitably reinvest the proceeds of property sales promptly could adversely affect our financial condition and results of operations. We may incur impairment charges in 2025. We evaluate on a quarterly basis our real estate portfolio for indicators of impairment.
Our inability to reconfigure our portfolio to profitably reinvest the proceeds of property sales promptly could adversely affect our financial condition and results of operations. We may incur impairment charges in 2026. We evaluate on a quarterly basis our real estate portfolio for indicators of impairment.
Our ability to lease units at our multifamily properties at favorable rates is adversely affected by the increase in supply in the multifamily and other rental markets and other housing alternatives, and is dependent upon the overall level in the economy, which may continue to be adversely affected by, among other things, inflationary conditions, job losses and unemployment levels, personal debt levels, a downturn in the housing market, stock market volatility, and uncertainty about the future.
Our ability to lease units at our multi-family properties at favorable rates is adversely affected by the increase in supply in the multi-family and other rental markets and other housing alternatives, and is dependent upon the overall level in the economy, which may continue to be adversely affected by, among other things, inflationary conditions, job losses and unemployment levels, personal debt levels, a downturn in the housing market, stock market volatility, and uncertainty about the future.
In the event such a claim were made against us under a “bad boy” carve out guarantee, following foreclosure on mortgages or related loans, and such claim were successful, our business and financial results could be materially adversely affected.
In the event such a claim were made against us under a “bad boy” carve out guarantee, following foreclosure on mortgages or related loans, and such claim were successful, our business and financial results would be materially adversely affected.
From time-to-time claims may be asserted against us with respect to some of our properties under the ADA. If, under the ADA, we are required to make substantial alterations and capital expenditures in one or more of our properties, it could adversely affect our financial condition and results of operations.
From time-to-time, claims have been, and may continue to be, asserted against us with respect to some of our properties under the ADA. If, under the ADA, we are required to make substantial alterations and capital expenditures in one or more of our properties, it could adversely affect our financial condition and results of operations.
We and our 18 Table of Contents stockholders could be adversely affected by any such change in the U.S. federal income tax laws, regulations or administrative interpretations. Liabilities relating to environmental matters may impact the value of our properties. We may be subject to environmental liabilities arising from the ownership of properties.
We and our stockholders could be adversely affected by any such change in the U.S. federal income tax laws, regulations or administrative interpretations. Liabilities relating to environmental matters may impact the value of our properties. We may be subject to environmental liabilities arising from the ownership of properties.
Accordingly, adverse developments in such markets, including economic developments, pandemics, or natural or man-made disasters, could adversely impact the cash flow and value of these properties.
Accordingly, adverse developments in such markets, including economic developments, pandemics, or natural or man-made disasters, would adversely impact the cash flow and value of these properties.
Short-term leases expose us to the effects of declining market rents and we may be unable to renew leases or relet units as leases expire. Our multi-family leases are generally for a term of one year or less.
Short-term leases expose us to the effects of declining market rents and we may be unable to renew leases or relet units as leases expire. 16 Table of Contents Our multi-family leases are generally for a term of one year or less.
Our estimates and judgments are based on a number of factors, including projected cash flow from the collateral securing our loans, debt structure, including the availability of reserves and recourse guarantees, likelihood of repayment in full at the maturity of a loan, potential for refinancing and expected market discount rates for varying property types, and other macro economic data, all of which are uncertain and highly subjective.
Our estimates and judgments are based on a number of factors, including projected cash flow from the collateral, if any, securing our investments, the structure of our investment, including the availability of reserves and recourse guarantees, likelihood of repayment in full at the maturity of a loan, potential for refinancing and expected market discount rates for varying property types, and other macro economic data, all of which are uncertain and highly subjective.
The aggregate fees to be paid for the Services in 2025, and paid in 2024 and 2023, are $1.7 million, $1.62 million and $1.54 million, respectively. We obtain certain executive, administrative, legal, accounting and clerical personnel and the use of certain facilities pursuant to the shared services agreement.
The aggregate fees to be paid for the Services in 2026, and paid in 2025 and 2024, are $1.8 million, $1.7 million and $1.6 million, respectively. We obtain certain executive, administrative, legal, accounting and clerical personnel and the use of certain facilities pursuant to the shared services agreement.
During 2024 and 2023, we reimbursed Gould Investors $698,000 and $642,000, respectively, for the personnel and facilities provided pursuant to the shared services agreement. We also obtain certain insurance in conjunction with Gould Investors and reimbursed Gould Investors $28,000 and $22,000, in 2024 and 2023, respectively, for our share of the insurance cost.
During 2025 and 2024, we reimbursed Gould Investors $750,000 and $698,000, respectively, for the personnel and facilities provided pursuant to the shared services agreement. We also obtain certain insurance in conjunction with Gould Investors and reimbursed Gould Investors $30,000 and $28,000, in 2025 and 2024, respectively, for our share of the insurance cost.
As of December 31, 2024: (i) our wholly-owned properties generated approximately 75% and 10% of our 2024 revenues from properties located in the Southeast and Texas, respectively, and (ii) the properties owned by unconsolidated joint ventures at December 31, 2024, generated 54% and 46% of our 2024 JV Rental and Other Revenues at properties located in the Southeast and Texas, respectively.
As of December 31, 2025: (i) our wholly-owned properties generated approximately 75% and 9% of our 2025 revenues from properties located in the Southeast and Texas, respectively, and (ii) the properties owned by unconsolidated joint ventures at December 31, 2025, generated 59% and 41% of our 2025 JV Rental and Other Revenues at properties located in the Southeast and Texas, respectively.
At February 28, 2025, we had approximately $62.7 million of cash and cash equivalents (of which a significant portion is at the property level for day-to-day operating expenses) and up to $40 million available to us under our credit facility.
At February 27, 2026, we had approximately $24.8 million of cash and cash equivalents (of which a significant portion is required for day-to-day operating expenses at the property level) and up to $40 million available to us under our credit facility.
From time to time we have failed to comply with certain debt covenants.
From time to time we have failed to comply with certain debt 17 Table of Contents covenants.
Although the properties purchased by Gould Investors are much smaller than the properties in which we are interested, a conflict of interest could arise should Gould Investors or we decide to pursue the acquisition of similar sized properties in such regions.
Although the properties purchased by Gould Investors are generally smaller than the properties in which we are interested, a conflict of interest will arise should Gould Investors decide to pursue the acquisition of large properties in such region.
The cost of future improvements and deferred maintenance is uncertain and the amounts earmarked for specific properties may be insufficient to effectuate needed improvements. Our results of operations and financial conditions may be adversely affected if we are required to expend significant funds (other than funds earmarked for such purposes) to repair or improve our properties.
Our results of operations and financial conditions may be adversely affected if we are required to expend significant funds (other than funds earmarked for such purposes) to repair or improve our properties.
The loss of our property managers, and in particular, the managers that manage multiple properties, could result in a decrease in occupancy rates, rental rates or both or an increase in expenses.
Three properties are managed by a management company owned by or affiliated with a joint venture partner. The loss of our property managers, and in particular, the managers that manage multiple properties, could result in a decrease in occupancy rates, rental rates or both or an increase in expenses.
Unfavorable market and economic conditions may significantly affect our occupancy levels, our rental rates and collections, the value of our properties and our ability to acquire or dispose of multifamily properties on economically favorable terms.
General economic conditions in the U.S. have fluctuated significantly in recent quarters. Unfavorable market and economic conditions significantly affect our occupancy levels, our rental rates and collections, the value of our properties and our ability to acquire or dispose of multi-family properties on favorable terms.
As a result, we are subject to risks inherent in investments in a single industry, and a decrease in the demand for multi-family properties would likely have a greater adverse effect on our rental revenues than if we owned a more diversified real estate portfolio. 15 Table of Contents Our operating results and assets may be negatively affected if our insurance coverage is insufficient to compensate us for casualty events occurring at our properties.
As a result, we are subject to risks inherent in investments in a single industry, and a decrease in the demand for multi-family properties would likely have a greater adverse effect on our rental revenues than if we owned a more diversified real estate portfolio.
The following table sets forth, as of December 31,2024, the principal balance of the mortgage payments due at maturity on our wholly owned and unconsolidated joint venture properties and the weighted average interest rate thereon (dollars in thousands): Consolidated Properties Unconsolidated Properties Year Principal Balances Due at Maturity Weighed Average Interest Rate Principal Balances Due at Maturity (1) Weighed Average Interest Rate 2025 $ 15,375 4.42 % $ — — % 2026 69,531 4.12 60,835 5.64 2027 42,795 3.96 23,108 4.15 2028 37,951 4.47 67,631 4.26 2029 53,817 3.94 — — 2030 and thereafter 193,266 4.10 86,132 3.46 Total $ 412,735 $ 237,706 _____________ (1) Includes our joint venture partner's "share" of such debt.
The following table sets forth, as of December 31, 2025, the principal balance of the mortgage payments due at maturity on our wholly-owned and unconsolidated joint venture properties and the weighted average interest rate thereon (dollars in thousands): Consolidated Properties Unconsolidated Properties Year Principal Balances Due at Maturity Weighed Average Interest Rate Principal Balances Due at Maturity (1) Weighed Average Interest Rate 2026 $ 27,767 3.73 % $ 60,910 5.18 % 2027 42,795 3.96 % 23,108 4.15 % 2028 37,951 4.47 % 67,631 4.26 % 2029 54,390 3.94 % — — 2030 21,265 4.71 % — — 2031 and thereafter 259,605 4.34 % 124,834 3.75 % Total $ 443,773 $ 276,483 _____________ (1) Includes our joint venture partner's "share" of such debt.
Therefore, in the event of our bankruptcy, liquidation or reorganization, our assets and those of our subsidiaries will be able to satisfy your claims as stockholders only after all our and our subsidiaries' liabilities and obligations have been paid in full.
Therefore, in the event of our bankruptcy, liquidation or reorganization, our assets and those of our subsidiaries will be able to satisfy your claims as stockholders only after all our and our subsidiaries' liabilities and obligations have been paid in full. 18 Table of Contents Regulatory and Tax Risks Changes to the U.S. federal income tax laws could have an adverse impact on our business and financial results.
A foreclosure or other forced disposition of our assets could result in the disposition of same at below the carrying value of such asset.
A foreclosure or other forced disposition of our assets could result in the disposition of same at below the carrying value of such asset. The disposition of our properties or assets at below our carrying value may adversely affect our net income, reduce our stockholders’ equity and adversely affect our ability to pay dividends.
Regulatory and Tax Risks Changes to the U.S. federal income tax laws could have an adverse impact on our business and financial results. At any time, the U.S. federal income tax laws governing REITs or the administrative interpretations of those laws may be amended.
At any time, the U.S. federal income tax laws governing REITs or the administrative interpretations of those laws may be amended.
If we are unable to promptly renew the leases or relet the units, or if the rental rates upon renewal or reletting are significantly lower than expected rates, then our financial condition and results of operations may be adversely affected . 16 Table of Contents Risks Related to Our Financing Activities, Indebtedness and Capital Resources If we are unable to refinance our mortgage debt at maturity on acceptable terms, we may be forced to sell properties on disadvantageous terms.
If we are unable to promptly renew the leases or relet the units, or if the rental rates upon renewal or reletting are significantly lower than the previous rates, our financial condition and results of operations may be adversely affected .
Gould, only two other executive officers, Mitchell Gould, our executive vice president, and George Zweier, vice president and chief financial officer, devote all or substantially all of their business time to us.
Gould, only two other executive officers, Matthew Gibbons, our chief accounting officer, and Ryan Gould, a vice president, devote all or substantially all of their business time to us. Many of our executives, including Isaac Kalish, our chief financial officer (i) also provide the Services (see "
At December 31, 2024 the weighted average age (based on the number of units) of our multi-family properties is approximately 20 years. To remain competitive and increase occupancy at these properties and/or make them attractive to potential tenants or purchasers, we may have to make significant capital improvements and/or incur deferred maintenance costs with respect to these properties.
To remain competitive and increase occupancy at these properties and/or make them attractive to potential tenants or purchasers, we may have to make significant capital improvements and/or incur deferred maintenance costs with respect to these properties. The cost of future improvements and deferred maintenance is uncertain and the amounts earmarked for specific properties may be insufficient to effectuate needed improvements.
However, since our leases typically permit the residents to leave at the end of the lease term without penalty, our revenues are impacted by declines in market rents more quickly than if our leases were for longer terms.
Accordingly, our revenues are impacted by declines in market rents more quickly than if our leases were for longer terms.
The categorization of risks set forth below is meant to help you better understand the risks facing our business and is not intended to limit your consideration of the possible effects of these risks to the listed categories.Any adverse effects arising from the realization of any of the risks discussed, including our financial condition and results of operation, may, and likely will, adversely affect many aspects of our business.
Item 1A. Risk Factors. Set forth below is a discussion of certain risks affecting our business. The categorization of risks set forth below is meant to help you better understand the risks facing our business and is not intended to limit your consideration of the possible effects of these risks to the listed categories.
If we are unable to terminate an underperforming property manager on a timely basis, our occupancy and rental rates may decrease and our expenses may increase. Our efforts to buy properties directly may involve greater risks than buying properties with joint venture partners.
If we are unable to terminate an underperforming property manager on a timely basis, our occupancy and rental rates may decrease and our expenses may increase. Risks involved in conducting real estate activity through joint ventures. Ten of our multi-family properties are owned through joint ventures with other persons or entities.
Risks Related to Real Estate Investments and Our Operations Unfavorable market and economic conditions could adversely affect rental revenues, occupancy levels and the value of our properties. General economic conditions in the U.S. have fluctuated significantly in recent quarters.
Any adverse effects arising from the realization of any of the risks discussed, including our financial condition and results of operation, may, and likely will, adversely affect many aspects of our business. Risks Related to Real Estate Investments and Our Operations Unfavorable market and economic conditions could adversely affect rental revenues, occupancy levels and the value of our properties.
If these property management companies do not perform their duties properly, or, in the case of unconsolidated properties, we and/or our joint venture partners do not effectively supervise the activities of these managers, the occupancy rates and rental rates at the properties managed by such property managers may decline and the expenses at such properties may increase.
If these property management companies do not perform their duties properly, the occupancy and rental rates at such properties may decline and the expenses at such properties may increase. At December 31, 2025, one property manager manages 11 properties, a second property manager manages eight properties, and five other property managers manage three or fewer properties.
Removed
Item 1A. Risk Factors. Set forth below is a discussion of certain risks affecting our business.
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Our operating results and assets may be negatively affected if our insurance coverage is insufficient to compensate us for casualty events occurring at our properties.
Removed
At December 31, 2024, one property manager manages 11 properties, a second property manager manages eight properties, and four other property managers manage three or fewer properties. Three properties are managed by a management company owned by or affiliated with a joint venture partner.
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Risks Related to Our Financing Activities, Indebtedness and Capital Resources If we are unable to refinance our mortgage debt at maturity on acceptable terms, we may be forced to sell properties on disadvantageous terms.
Removed
Although historically we have acquired properties with joint venture partners with knowledge of the local markets in which we were acquiring properties, we are working to buy properties directly without joint venture partners.
Removed
In buying properties directly, we do not have the benefit of a partner’s understanding of the target markets nor the equity they would have contributed to the acquisition.
Removed
We cannot provide any assurance that we will properly evaluate the acquisition opportunities we pursue in buying properties directly. 14 Table of Contents Risks involved in conducting real estate activity through joint ventures. Eight of our multi-family properties are owned through joint ventures with other persons or entities.
Removed
The short-term nature of these leases generally serves to reduce our risk to adverse effects of inflation as our leases allow for adjustments in the rental rate at the time of renewal, which may enable us to seek rent increases.
Removed
Beginning January 2025, Mitchell Gould is working for us four days per week and George Zweier has advised that he intends to relocate to North Carolina by June 2026 and resign. Many of our executives (i) also provide the Services (see "

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur internal auditor perform certain procedures to test the integrity and functionality of our IT systems (which includes a high-level review of our cybersecurity defenses).
Biggest changeOur internal auditor performs certain procedures to test the integrity and functionality of our IT systems (which includes a high-level review of our cybersecurity defenses).

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. Our principal executive office is located at 60 Cutter Mill Road, Suite 303, Great Neck, NY. We believe that this facility is satisfactory for our current and projected needs. See "Item 1—Business" for additional information regarding our properties.
Biggest changeItem 2. Properties. Our principal executive office is located at 60 Cutter Mill Road, Suite 303, Great Neck, NY. We believe that this facility is satisfactory for our current and projected needs. See "Item 1—Business" for additional information regarding our properties. 13 Table of Contents

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeSee Note 14 of our Consolidated Financial Statements.
Biggest changeSee note 14 to our Consolidated Financial Statements.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Purchases of Equity Securities Period (a) Total Number of Shares Purchased (b) Average Price Paid per Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs October 1 - October 31, 2024 — $ — — $ 6,270,910 November 1 - November 30, 2024 — — — 6,270,910 December 1 - December 31, 2024 10,286 17.80 10,286 6,087,815 Total 10,286 $ 17.80 10,286 From January 1, 2025 through February 28, 2025 we purchased, pursuant to our publicly announced repurchase program, 65,018 shares at a weighted average price of $17.49 per share.
Biggest changePurchases by Issuer Period (a) Total Number of Shares Purchased (b) Average Price Paid per Share (c) Total Amount of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs October 1 - October 31, 2025 — $ — $ — $ 8,752,933 November 1 - November 30, 2025 96,572 14.47 1,396,983 7,355,045 December 1 - December 31, 2025 82,408 14.61 1,204,111 6,150,934 Total 178,980 $ 14.53 $ 2,601,094 Subsequent to December 31, 2025 we purchased, pursuant to our publicly announced repurchase program, 75,155 shares at an average price of $14.82 per share.
As of March 11, 2025, after giving effect to an increase in, and extension of, our share repurchase authorization, we are authorized to repurchase up to $10.0 million of shares through December 31, 2026.
As of March 11, 2026, after giving effect to an increase in, and extension of, our share repurchase authorization, we are authorized to repurchase up to $10.0 million of shares through December 31, 2028.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information; Holders Our shares of common stock are listed on the New York Stock Exchange, or the NYSE, under the symbol "BRT." As of February 28, 2025, there were approximately 704 holders of record of our common stock.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information; Holders Our shares of common stock are listed on the New York Stock Exchange, or the NYSE, under the symbol "BRT." As of February 27, 2026, there were approximately 679 holders of record of our common stock.
Added
Purchases of Equity Securities by Issuer and Affiliated Purchases The following tables summarize the purchases of our common stock during the three months ended December 31, 2025 by us and by Gould Investors (Gould Investors may be deemed to be an "affiliated purchaser" (as such term is used in Rule 10b-19a)(3) promulgated under the Exchange Act) of our company as Jeffrey A.
Added
Gould and Matthew J. Gould, our executive officers, are directly or indirectly, the managers of the managing general partner of Gould Investors):.
Added
Purchases by Affiliated Purchaser Period Total Number of Purchased Shares Average Price Paid per Share Total Cost October 1 - October 31, 2025 33,953 $14.93 $ 507,029 November 1 - November 30, 2025 — — — December 1 - December 31, 2025 — — — Total (1) 33,953 $14.93 $ 507,029 ______________________________ (1) Excludes 46,600 and 50,337 shares of common stock purchased at an average price of $15.62 and $14.70, respectively, pursuant to our dividend reinvestment plan with respect to dividends declared in September and December 2025, respectively.

Item 7. Management's Discussion & Analysis

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

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Biggest changeManagement also reviews the reconciliation of net income (loss) to FFO and AFFO. 32 Table of Contents The table below provides a reconciliation of net income determined in accordance with GAAP to FFO and AFFO for each of the indicated years (amounts in thousands): 2024 2023 GAAP Net income attributable to common stockholders $ (9,791) $ 3,873 Add: depreciation of properties 25,926 28,484 Add: our share of depreciation in unconsolidated joint venture properties 5,545 5,292 Add: provision for credit loss 270 — Add: casualty loss — 323 Deduct: gain on sales of real estate (806) (604) Deduct: our share of earnings in earnings from sale of unconsolidated joint venture properties (209) (14,744) Adjustment for non-controlling interests (16) (16) Funds from operations 20,919 22,608 Adjust for: straight line rent concession, net of amortization (801) 93 Adjust for: our share of straight-line rent concessionn, net of amortization from unconsolidated joint ventures (147) — Add: our share of loss on extinguishment of debt from unconsolidated joint venture properties — 212 Add: amortization of restricted stock and RSU expense 4,877 4,768 Add: amortization of deferred mortgage and debt costs 1,150 1,072 Add: our share of deferred mortgage costs from unconsolidated joint venture properties 120 106 Add: amortization of fair value adjustment for mortgage debt 558 613 Less: insurance recovery of casualty loss — (323) Less: gain on insurance recovery — (240) Less: our share of gain on insurance proceeds from unconsolidated joint venture properties — (30) Adjustment for non-controlling interests (8) (15) Adjusted funds from operations $ 26,668 $ 28,864 33 Table of Contents The table below provides a reconciliation of net income per common share (on a diluted basis) determined in accordance with GAAP to FFO and AFFO. 2024 2023 Net (loss) income attributable to common stockholders $ (0.52) $ 0.20 Add: depreciation of properties 1.38 1.50 Add: our share of depreciation from unconsolidated joint venture properties 0.30 0.28 Add: provision for credit loss 0.01 — Add: casualty loss — 0.02 Deduct: gain on sales of real estate (0.04) (0.03) Deduct: our share of earnings from sale of unconsolidated joint venture properties (0.01) (0.78) Adjustment for non-controlling interests — — Funds from operations 1.12 1.19 Adjust for: straight line rent concessions, net of amortization (0.04) — Adjust for: our share of straight-line rent concessionn, net of amortization from unconsolidated joint ventures — — Add: our share of loss on extinguishment of debt from unconsolidated joint ventures — 0.01 Add: amortization of restricted stock and RSU expense 0.25 0.25 Add: amortization of deferred mortgage and debt costs 0.06 0.06 Add: our share of amortization of deferred mortgage and debt costs from unconsolidated ventures 0.01 0.01 Add: amortization of fair value adjustment for mortgage debt 0.03 0.03 Less: insurance recovery of casualty loss — (0.02) Deduct: gain on insurance recovery — (0.01) Deduct: our share of gain on insurance proceeds from unconsolidated joint ventures — — Adjustment for non-controlling interests — — Adjusted funds from operations $ 1.43 $ 1.52 Diluted shares outstanding for FFO and AFFO 18,710,615 18,931,026 FFO for 2024 decreased $1.7 million, or 7%, to $20.9 million in 2024 from $22.6 million in 2023.
Biggest changeManagement also reviews the reconciliation of net income (loss) to FFO and AFFO. 31 Table of Contents The table below provides a reconciliation of net income determined in accordance with GAAP to FFO and AFFO for each of the indicated years (amounts in thousands): 2025 2024 GAAP Net loss attributable to common stockholders $ (11,946) $ (9,791) Add: depreciation of properties 26,396 25,926 Add: our share of depreciation in unconsolidated joint venture properties 7,625 5,545 Add: provision for credit loss 5 270 Deduct: gain on sales of real estate (755) (806) Deduct: our share of earnings in earnings from sale of unconsolidated joint venture properties (52) (209) Adjustment for non-controlling interests (17) (16) Funds from operations 21,256 20,919 Adjust for: straight line rent concession, net of amortization (315) (801) Adjust for: our share of straight-line rent concession, net of amortization from unconsolidated joint ventures (33) (147) Add: amortization of restricted stock and RSU expense 4,692 4,877 Add: amortization of deferred mortgage and debt costs 1,202 1,150 Add: our share of deferred mortgage costs from unconsolidated joint venture properties 119 120 Add: amortization of fair value adjustment for mortgage debt 525 558 Adjustment for non-controlling interests — (8) Adjusted funds from operations $ 27,446 $ 26,668 32 Table of Contents The table below provides a reconciliation of net income per common share (on a diluted basis) determined in accordance with GAAP to FFO and AFFO. 2025 2024 Net loss attributable to common stockholders $ (0.63) $ (0.52) Add: depreciation of properties 1.39 1.38 Add: our share of depreciation in unconsolidated joint venture properties 0.40 0.30 Add: provision for credit loss — 0.01 Deduct: gain on sales of real estate (0.04) (0.04) Deduct: our share of earnings from sale of unconsolidated joint venture properties — (0.01) Adjustment for non-controlling interests — — Funds from operations 1.12 1.12 Adjust for: straight line rent concessions, net of amortization (0.02) (0.04) Adjust for: our share of straight-line rent concession, net of amortization from unconsolidated joint ventures — — Add: amortization of restricted stock and RSU expense 0.25 0.25 Add: amortization of deferred mortgage and debt costs 0.06 0.06 Add: our share of amortization of deferred mortgage and debt costs from unconsolidated ventures 0.01 0.01 Add: amortization of fair value adjustment for mortgage debt 0.03 0.03 Adjustment for non-controlling interests — — Adjusted funds from operations $ 1.45 $ 1.43 Diluted shares outstanding for FFO and AFFO 18,930,284 18,710,615 FFO for 2025 increased $337,000, or 1.6%, to $21.3 million from $20.9 million in 2024.
The credit facility is secured by cash accounts maintained by us at VNB (and we are required to maintain substantially all of our bank accounts at VNB), and the pledge of our interests in the entities that own three unencumbered multi-family properties used in calculating the borrowing base.
The credit facility is secured by cash accounts maintained by us at VNB (we are required to maintain substantially all of our bank accounts at VNB), and the pledge of our interests in the entities that own three unencumbered multi-family properties used in calculating the borrowing base.
Net proceeds received from the sale, financing or refinancing of wholly-owned properties are generally required to be used to repay amounts outstanding under the credit facility. As of December 31, 2024, we were in compliance in all material respects with the requirements of the facility.
Net proceeds received from the sale, financing or refinancing of wholly-owned properties are generally required to be used to repay amounts outstanding under the credit facility. As of December 31, 2025, we were in compliance in all material respects with the requirements of the facility.
We anticipate that if we do not sell any multi-family properties this year, that a significant amount of the dividends we will pay in 2025 will be treated for federal income tax purposes as a return of capital.
We anticipate that if we do not sell any multi-family properties this year, that a significant amount of the dividends we will pay in 2026, if any, will be treated for federal income tax purposes as a return of capital.
We also consider information obtained about each 39 Table of Contents property as a result of its pre-acquisition due diligence, marketing and leasing activities in estimating the fair value of the tangible and intangible assets acquired.
We also consider information obtained about each 38 Table of Contents property as a result of its pre-acquisition due diligence, marketing and leasing activities in estimating the fair value of the tangible and intangible assets acquired.
Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe NOI provides an operating perspective not immediately apparent from GAAP operating income or net income (loss).
Other REIT’s may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REIT’s. We believe NOI provides an operating perspective not immediately apparent from GAAP operating income or net income (loss).
During 2024, we continued to experience inflationary pressures that drove higher operating expenses, primarily in personnel, repairs and maintenance, insurance and real estate taxes; such increases may continue in 2025 and thereafter, which would adversely affect our operating results. Inflation affects the overall cost of our debt.
During 2025, we continued to experience inflationary pressures that drove higher operating expenses, primarily in personnel, repairs and maintenance, and real estate taxes; such increases may continue in 2026 and thereafter, which would adversely affect our operating results. Inflation affects the overall cost of our debt.
We believe the accounting estimates listed below are the most critical to aid in 38 Table of Contents fully understanding and evaluating our reported financial results, and they require our most difficult, subjective or complex judgments, resulting from the need to make estimates about the effect of matters that are inherently uncertain.
We believe the accounting estimates listed below are the most critical to aid in fully understanding and evaluating our reported financial results, and they require our most difficult, subjective or complex judgments, resulting from the need to make estimates about the effect of matters that are inherently uncertain.
Comparison of Years Ended December 31, 2023 and 2022 As we are a smaller reporting company, this comparison is omitted in accordance with Instruction 1 to Item 303(a) of Regulation S-K. 31 Table of Contents Funds from Operations; Adjusted Funds from Operations; Net Operating Income.
Comparison of Years Ended December 31, 2024 and 2023 As we are a smaller reporting company, this comparison is omitted in accordance with Instruction 1 to Item 303(a) of Regulation S-K. 30 Table of Contents Funds from Operations; Adjusted Funds from Operations; Net Operating Income.
In March 2025, our board of directors increased the value of the shares that we can repurchase to up to $10 million and extended the repurchase program through December 31, 2026.
In March 2026, our board of directors increased up to $10 million the value of the shares that we can repurchase and extended the repurchase program through December 31, 2028.
Our operating cash flow and available cash is insufficient to fully fund the $317.2 million of balloon payments, and if we are unable to refinance such debt on acceptable terms, we may need to issue additional equity or dispose of properties, in each case on potentially unfavorable terms.
Our operating cash flow and available cash is insufficient to fully fund the $314.6 million of balloon payments, and if we are unable to refinance such debt on acceptable terms, we may need to issue additional equity or dispose of properties, in each case on potentially unfavorable terms.
At December 31, 2024, the carrying value of these investments was $17.7 million and these investments are subordinate to mortgage debt of $51.3 million, which debt is not reflected on our consolidated balance sheet. See " Item 1. Business-Mortgage Debt " for information regarding our mortgage debt at consolidated and unconsolidated subsidiaries.
At December 31, 2025, the carrying value of these investments was $17.7 million and these investments are subordinate to mortgage debt of $51.0 million, which debt is not reflected on our consolidated balance sheet. See " Item 1. Business-Mortgage Debt " for information regarding our mortgage debt at consolidated and unconsolidated subsidiaries.
Actual results could materially differ from any of our estimates under different assumptions or conditions. Our significant accounting policies are discussed in Note 1 of our consolidated financial statements in this report.
Actual results could materially differ from any of our estimates under different assumptions or conditions. Our significant accounting policies are discussed in Note 1 of our 37 Table of Contents consolidated financial statements in this report.
Includes all of the debt of unconsolidated joint ventures. See the following table for information regarding same. Assumes that the interest rate on the junior subordinated notes will be 6.85% per annum, which was the rate in effect at December 31, 2024.
Includes all of the debt of unconsolidated joint ventures. See the following table for information regarding same. Assumes that the interest rate on the junior subordinated notes will be 6.10% per annum, which was the rate in effect at December 31, 2025.
However, increasing interest rates, which generally correlates to increasing inflation, increases the interest expense on our junior subordinated notes and makes it less attractive to obtain mortgage debt (including the refinancing of an aggregate of $130.4 million of mortgage debt (including $60.8 million of mortgage debt at unconsolidated joint ventures, that matures in 2026) or use our credit facility in connection with acquisition and value add activities.
However, increasing interest rates, which generally correlates to increasing inflation, increases the interest expense on our junior subordinated notes and makes it less attractive to obtain mortgage debt (including the refinancing of an aggregate of $88.7 million of mortgage debt (including $60.9 million of mortgage debt at unconsolidated joint ventures, that matures in 2026)) or use our credit facility in connection with acquisition and value add activities.
Although BRT Apartments Corp. is not the obligor with respect to such mortgage debt, the loss of any of these properties due to mortgage foreclosure or similar proceedings would have a material adverse effect on our results of operations and financial condition. See note 6 to our consolidated financial statements.
Although BRT Apartments Corp. is not the obligor with respect to such mortgage debt, the loss of any of these properties due to mortgage foreclosure or similar proceedings would have a material adverse effect on our results of operations and financial condition.
(2) Assumes that the interest rate on the junior subordinated notes will be 6.85% per annum and that no amounts are outstanding under the credit facility. Corporate Level Financing Arrangements Junior Subordinated Notes As of December 31, 2024, $37.4 million (excluding deferred costs of $237,000) in principal amount of our junior subordinated notes is outstanding.
(2) Assumes that the interest rate on the junior subordinated notes will be 6.10% per annum and that no amounts are outstanding under the credit facility. Corporate Level Financing Arrangements Junior Subordinated Notes As of December 31, 2025, $37.4 million (excluding deferred costs of $217,000) in principal amount of our junior subordinated notes is outstanding.
The credit facility bears an annual interest rate, which resets monthly, equal to one-month term SOFR plus 250 basis points, with a floor of 6.00%. The interest rate at December 31, 2024 and February 28, 2025, was 6.96% and 6.83% respectively. There is an annual fee of 0.25% on the total amount committed by VNB and unused by us.
The credit facility bears an annual interest rate, which resets monthly, equal to one-month term SOFR plus 250 basis points, with a floor of 6.00%. The interest rate at December 31, 2025 and February 27, 2026, was 6.37% and 6.18% respectively. There is an annual fee of 0.25% on the total amount committed by VNB and unused by us.
The credit facility matures in September 2027. As of February 28, 2025, there was no balance outstanding and up to $40 million was available to be borrowed thereunder.
The credit facility matures in September 2027. As of February 27, 2026, there was no balance outstanding and up to $40 million was available to be borrowed thereunder.
We mitigate the risks presented by inflation through the use of long-term fixed interest rate debt and interest rate hedges and by paying down, when we deem appropriate, our credit facility debt.
We mitigate the risks presented by inflation through the use of fixed interest rate mortgage debt and by paying down, when we deem appropriate, our credit facility debt.
We anticipate that for the four years beginning January 1, 2025, our operating expenses, $118.2 million of mortgage amortization and interest expense (including $42.4 million from unconsolidated joint ventures) and $317.2 million of balloon payments due with respect to mortgages maturing through 2028 (including $151.6 million from unconsolidated joint ventures), anticipated capital expenditures (for 2025 only) of an aggregate of $11.1 million for consolidated and unconsolidated properties, estimated cash dividend payments of at least $75.1 million (assuming (i) the current quarterly dividend rate of $0.25 per share and (ii) 18.8 million shares outstanding), will be funded from cash generated from operations (including distributions from unconsolidated joint ventures), mortgage financings and re-financings, sales of properties, the issuance of additional equity and, if available, our $40 million credit facility.
We anticipate that for the four years beginning January 1, 2026, our operating expenses, $120 million of mortgage amortization and interest expense (including $38.8 million from unconsolidated joint ventures) and $314.6 million of balloon payments due with respect to mortgages maturing through 2029 (including $151.7 million from unconsolidated joint ventures), anticipated capital expenditures (for 2026 only) of an aggregate of $12.1 million for consolidated and unconsolidated properties, estimated cash dividend payments of at least $75.6 million (assuming (i) the current quarterly dividend rate of $0.25 per share and (ii) 18.9 million shares outstanding), will be funded from cash generated from operations (including distributions from unconsolidated joint ventures), mortgage financings and re-financings, sales of properties, the issuance of additional equity and, if available, our $40 million credit facility.
Other Financing Sources and Arrangements At December 31, 2024, we are joint venture partners in unconsolidated joint ventures which own eight multi-family properties which distributed $4.4 million to us in 2024. We may be required to make capital contributions with respect to these properties.
Other Financing Sources and Arrangements At December 31, 2025, we are joint venture partners in unconsolidated joint ventures which own ten multi-family properties which distributed $3.9 million to us in 2025. We may be required to make capital contributions with respect to these properties.
At December 31, 2024, we: (i) wholly-own 21 multi-family properties with an aggregate of 5,420 units and a carrying value of $614.2 million, (ii) have ownership interests, through unconsolidated entities, in eight multi-family properties with an aggregate of 2,527 units, with a carrying value of $31.3 million; (iii) have preferred equity investments in two multi-family properties with a carrying value of $17.7 million and (iv) own other assets, through consolidated and unconsolidated entities, with a carrying value of $1.7 million.
At December 31, 2025, we: (i) wholly-own 21 multi-family properties with an aggregate of 5,420 units and a carrying value of $595.2 million, (ii) have ownership interests, through unconsolidated entities, in ten multi-family properties with an aggregate of 2,891 units with a carrying value of $46.1 million; (iii) have preferred equity investments in two multi-family properties with a carrying value of $17.7 million; and (iv) own other assets, through consolidated and unconsolidated entities, with a carrying value of $1.6 million.
At December 31, 2024, our investment in these joint venture properties have a net equity carrying value of $31.3 million and are subject to mortgage debt, which is not reflected on our consolidated balance sheet, of $251.9 million.
At December 31, 2025, our investment in these joint venture properties have a net equity carrying value of $46.1 million and are subject to mortgage debt, which is not reflected on our consolidated balance sheet, of $286.5 million.
The benefit recorded in 2024 is the result of a $534,000 refund of Tennessee franchise tax received as a result of a change in Tennessee law offset by the 2024 estimated state tax expense of $318,000. The 2023 tax expense of $54,000 includes a reversal of a prior year over-accrual.
The benefit recorded in 2024 is the result of a $534,000 refund of franchise tax received as a result of a change in Tennessee law, offset by the 2024 estimated state tax expense of $318,000.
At December 31, 2024 and 2023, the interest rate on these notes was 6.85% and 7.65%, respectively.
At December 31, 2025 and 2024, the interest rate on these notes was 6.1% and 6.85%, respectively.
The 29 multi-family properties are located in 11 states; primarily in the Southeast United States and Texas.
The 31 multi-family properties are located in 11 states; primarily in the Southeast United States and Texas. 2025 and Recent Developments.
Excluding funds held at our unconsolidated subsidiaries, at December 31, 2024 and February 28, 2025, our available liquidity was approximately $67.9 million and $62.7 million, respectively, including $27.9 million and $22.7 million, respectively, of cash and cash equivalents, and subject to compliance with borrowing base and other requirements, up to $40 million available under our credit facility.
Excluding funds held at our unconsolidated subsidiaries, at December 31, 2025 and February 27, 2026, our available liquidity was approximately $65.1 million and $64.8 million, respectively, including $25.1 million and $24.8 million, respectively, of cash and cash equivalents, and subject to compliance with borrowing base and other requirements, up to $40 million available under our credit facility.
Inflation Substantially all of our multi-family property leases are for periods of one-year or less. The short-term nature of these leases generally serves to reduce our risk to adverse effects of inflation on our revenue.
Inflation Substantially all of our multi-family property leases are for periods of one-year or less. The short-term nature of these leases generally serves to reduce, but does not eliminate, the affect of inflation on our net income.
Generally, in 2024, our primary sources of capital and liquidity were the operations of our multi-family properties (including distributions of $4.7 million from the operations of our unconsolidated joint ventures), $27.4 million from the Woodland Trails Financing, and our available cash.
Generally, in 2025, our primary sources of capital and liquidity were the operations of our multi-family properties (including distributions of $4.2 million from the operations of our unconsolidated joint ventures), $29.7 million from the 2025 Financing, $1.2 million from interests in our Preferred Equity Investments and our available cash.
Grant date fair value is determined with respect to the (i) the restricted stock awards, by the closing stock price on the date of grant, (ii) TSR Awards, by using a Monte Carlo simulation relying upon various assumptions and (iii) AFFO Awards, by using the closing stock price on the grant date, subject to quarterly adjustment based upon management’s subjective projections as to the achievability of the specified metrics related to the AFFO Awards; changes in the projections related to the AFFO awards may have a significant impact on the expense we recognize on such awards.
Grant date fair value is determined with respect to the (i) the restricted stock awards, by the closing stock price on the date of grant, (ii) TSR Awards, by using a Monte Carlo simulation relying upon various assumptions and (iii) AFFO Awards, by using the closing stock price on the grant date, subject to quarterly adjustment based upon management’s subjective projections as to the achievability of the specified metrics related to the AFFO Awards (the “AFFO” Metrics).There is substantial subjectivity in (i) the inputs selected for the Monte Carlo simulation used in determining the grant date fair value of the TSR Awards and the use of different inputs would change the expense we recognize with respect to such awards and (ii) management’s projections as to the achievability of the AFFO Metrics and changes in such projections will cause fluctuations in our results of operations.
Liquidity and Capital Resources We require funds to pay operating expenses and debt service obligations, acquire properties, make capital and other improvements, fund capital contributions, pay dividends and repurchase shares of our common stock.
See " Results of Operations -Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024 " for a discussion of these changes. 34 Table of Contents Liquidity and Capital Resources We require funds to pay operating expenses and debt service obligations, acquire properties, make capital and other improvements, fund capital contributions, pay dividends and repurchase shares of our common stock.
At December 31, 2024, we had preferred equity investments in joint ventures that own multi-family properties. These joint ventures paid us $196,000 in 2024 and we anticipate that, subject to the underlying property generating sufficient cash flow, 37 Table of Contents that such joint ventures will pay us of $1.2 million in 2025.
These joint ventures paid us $1.2 million in 2025 and we anticipate that, subject to the underlying property generating sufficient cash flow, that such joint ventures will pay us $1.3 million in 2026.
The following table provides a reconciliation of net income attributable to common stockholders as computed in accordance with GAAP to NOI for the periods presented (dollars in thousands): For the year ended December 31, 2024 2023 GAAP Net (loss) income attributable to common stockholders $ (9,791) $ 3,873 Less: Loan interest and other income (857) (548) Add: Interest expense 22,596 22,161 General and administrative 15,595 15,433 Depreciation 25,926 28,484 Provision for credit loss 270 — (Benefit) provision for taxes (226) 54 Less: Gain on sale of real estate (806) (604) Casualty loss — 323 Adjust for: Equity in earnings loss of unconsolidated joint venture properties (1,644) (2,293) Less: Equity in earnings from sale of unconsolidated joint venture properties — (14,744) Insurance recovery of casualty loss — (793) Gain on insurance recovery — (240) Add: Net income attributable to non-controlling interests 155 142 Net Operating Income $ 51,218 $ 51,248 Less: Non same store and non multi family (1) Revenues 1,594 1,480 Operating Expenses 460 479 Non-same store NOI 1,134 $ 1,001 Same Store Net Operating Income $ 50,084 $ 50,247 _____________________________________ (1) Prior year amounts have been adjusted to reflect the current year composition to reflect only those properties that were same store for both the current and the prior year.
The following table provides a reconciliation of net income attributable to common stockholders as computed in accordance with GAAP to NOI for the periods presented (dollars in thousands): For the year ended December 31, 2025 2024 GAAP Net loss attributable to common stockholders $ (11,946) $ (9,791) Less: Loan interest and other income (1,763) (857) Add: Interest expense 23,511 22,596 General and administrative 15,530 15,595 Depreciation 26,396 25,926 Provision for credit loss 5 270 Provision (benefit) for taxes 174 (226) Less: Gain on sale of real estate (755) (806) Adjust for: Equity in loss (earnings) of unconsolidated joint venture properties 174 (1,644) Less: Insurance recovery of casualty loss (313) — Add: Net income attributable to non-controlling interests 170 155 Net Operating Income $ 51,183 $ 51,218 Less: Non same store and non multi-family Revenues $ 1,698 $ 1,594 Operating Expenses 461 460 Non-same store NOI 1,237 $ 1,134 Same Store Net Operating Income $ 49,946 $ 50,084 _____________________________________ In 2025, NOI decreased by $35,000 from 2024 due primarily to a $527,000 increase in real estate operating expenses, offset by a $389,000 increase in rental revenue at wholly-owned multi-family properties and a $114,000 increase in rental revenue at the Yonkers' Property.
Expenses The following table compares our expenses for the periods indicated: (Dollars in thousands) 2024 2023 Change % Change Real estate operating expenses $ 43,555 $ 41,821 $ 1,734 4.1 % Interest expense 22,596 22,161 435 2.0 % General and administrative 15,595 15,433 162 1.0 % Provision for credit loss 270 — 270 N/A Depreciation and amortization 25,926 28,484 (2,558) (9.0) % Total expenses $ 107,942 $ 107,899 $ 43 — % Real estate operating expenses.
Expenses The following table compares our expenses for the periods indicated: (Dollars in thousands) 2025 2024 Change % Change Real estate operating expenses $ 44,082 $ 43,555 $ 527 1.2 % Interest expense 23,511 22,596 915 4.0 % General and administrative 15,530 15,595 (65) (0.4) % Provision for credit loss 5 270 (265) (98.1) % Depreciation and amortization 26,396 25,926 470 1.8 % Total expenses $ 109,524 $ 107,942 $ 1,582 1.5 % Real estate operating expenses.
In 2023, we sold a cooperative apartment in New York for a sales price of $785,000 and a gain of $604,000. (Benefit) provision for taxes Income tax (benefit) provision for 2024 was ($226,000), a decrease from the $54,000 provision recorded in 2023.
In 2024, we sold a cooperative apartment in NY for a sales price of approximately $1.1 million and a gain of $806,000. 29 Table of Contents Provision (benefit) for taxes Income tax provision for 2025 was $174,000, a $400,000 increase from the $226,000 benefit recorded in 2024.
From January 1, 2025 through February 28, 2025, we purchased 65,018 shares of our common stock for an aggregate purchase price of approximately $1.1 million ( i.e., an average price of $17.49 per share).
Subsequent to December 31, 2025, we purchased 75,155 shares of our common stock for an aggregate purchase price of approximately $1.1 million ( i.e., an average price of $14.82 per share).
Business—Our Structure." (3) Assumes that approximately $4.0 million of property management fees will be paid annually to the property managers of our multi-family properties, including $1.4 million related to unconsolidated joint ventures. Such sum reflects the amount we anticipate paying in 2025 on the multi-family properties we own at December 31, 2024.
(3) Assumes that $1 million and $1.8 million will be paid annually through December 31, 2030 pursuant to the shared services agreement and for the Services, respectively. (4) Assumes that approximately $2.5 million of property management fees will be paid annually to the property managers of our multi-family properties, including $760,000 related to unconsolidated joint ventures.
No amount has been reflected as payable pursuant thereto after five years as such amount is not determinable. 36 Table of Contents The following table sets forth as of December 31, 2024 information regarding the components of our long-term debt obligations: Payment due by Period (Dollars in thousands) Less than 1 Year 1 - 3 Years 3 - 5 Years More than 5 Years Total Mortgages on consolidated properties (1) $ 38,309 $ 150,323 $ 119,315 $ 246,372 $ 554,319 Mortgages on unconsolidated properties (1) 14,442 106,012 78,034 91,020 289,508 Junior subordinated notes and credit facility(2) 2,562 5,124 5,124 53,617 66,427 Total $ 55,313 $ 261,459 $ 202,473 $ 391,009 $ 910,254 ___________________________ (1) Includes payments of principal (including amortization payments), and interest, and excludes deferred financing costs.
No amount has been reflected as payable pursuant thereto after five years as such amount is not determinable. 35 Table of Contents The following table sets forth as of December 31, 2025 information regarding the components of our long-term debt obligations: Payment due by Period (Dollars in thousands) Less than 1 Year 1 - 3 Years 3 - 5 Years More than 5 Years Total Mortgages on consolidated properties (1) $ 51,872 $ 121,376 $ 105,881 $ 321,320 $ 600,449 Mortgages on unconsolidated properties (1) 74,657 110,658 13,244 127,974 326,533 Junior subordinated notes and credit facility (2) 2,281 4,563 4,563 49,560 60,967 Total $ 128,810 $ 236,597 $ 123,688 $ 498,854 $ 987,949 ___________________________ (1) Includes payments of principal (including amortization payments), and interest, and excludes deferred financing costs.
VNB required these changes as a condition to our obtaining the Woodlands Financing. • We sold a cooperative apartment unit in New York, NY for a sales price of approximately $1.1 million and recognized a gain of $806,000. • We repurchased 193,529 shares of our common stock for an aggregate purchase price of approximately $3.50 million ( i.e ., an average price of $18.07 per share).
As a result of the 2025 Financing, our aggregate annual principal payments are expected to decrease by $1.2 million (until 2030), and our annual interest expense is expected to increase by $1.8 million from the corresponding amounts under the Prior Mortgages. • we sold a cooperative apartment unit in New York, NY for a sales price of approximately $1.0 million and recognized a gain of $755,000. • we repurchased 321,060 shares of our common stock for an aggregate purchase price of approximately $4.99 million ( i.e., an average purchase price of $15.53 per share).
Equity in earnings of unconsolidated joint ventures Equity in earnings from unconsolidated joint ventures declined $649,000 to $1.6 million in the year ended December 31, 2024 from $2.3 million for the 2023.
Equity in earnings of unconsolidated joint ventures Equity in earnings from unconsolidated joint ventures decreased $1.8 million, from $1.6 million in 2024, to a loss of $174,000 for the year ended December 31, 2025. The components of the decrease include: • $1.5 million from the 2025 Acquisitions, primarily due to the amortization of the lease intangibles acquired in such transactions.
These fees are typically charges based on a percentage of rental revenues from a property.
Such sum reflects the amount we anticipate paying in 2026 on the multi-family properties we own at December 31, 2025. These fees are typically charges based on a percentage of rental revenues from a property.
The decrease is primarily due to the factors impacting the changes in FFO other than the changes to: gain on insurance proceeds, net deferred concessions and early extinguishment of debt. 34 Table of Contents See “—Comparison of Years Ended December 31, 2024 and 2023” for further information regarding these changes. NOI is a non-GAAP measure of performance.
See “Comparison of Years Ended December 31, 2025 and 2024” for further information regarding these changes. 33 Table of Contents NOI is a non-GAAP measure of performance.
Contributing to the decline was a: • $1.7 million decrease in operating margins ( i.e., revenues less real estate operating expenses) across our portfolio ( i.e. consolidated and unconsolidated multi-family properties); • $793,000 decrease due to the inclusion, in 2023, of an insurance recovery from a casualty loss at an unconsolidated joint venture; • $586,000 increase in interest expense; and • $240,000 decrease due to the inclusion, in 2023, of a gain on insurance proceeds The decrease was offset by a: • $1.0 million increase in straight line rent concessions, net of amortization; • $309,000 increase in other income; • $280,000 decline in income tax expense; and • $212,000 decline due to the inclusion, in 2023, of early extinguishment of debt charges.
Contributing to the increase was a: • $1.6 million increase in operating margins ( i.e., rental and other revenues from real estate properties less real estate operating expenses) across our portfolio ( i.e. consolidated and unconsolidated multi-family properties); • $906,000 increase in loan interest and other income; • $314,000 increase in insurance recoveries; and • $184,000 decrease in equity-based compensation.
The increase was offset by a $344,000 decrease in average occupancy year-over-year at the multi-family portfolio from 94.2% to 93.7%. Loan interest and other income The increase is due primarily to interest income of $197,000 received from the preferred equity investments which were originated in the fourth quarter of 2024.
Loan interest and other income The $1 million increase is due primarily to the inclusion, for all of 2025, of the income earned from the Preferred Equity Investments originated in the fourth quarter of 2024.
We believe that due, among other things, to its vibrant economy, that over-time, the Nashville market will absorb the excess rental capacity, although we can provide no assurance in this regard. 28 Table of Contents Results of Operations Comparison of Years Ended December 31, 2024 and 2023 The term "same store properties" refers to 21 multi-family properties with an aggregate of 5,420 units that were owned for all of 2024 and 2023.
For comparison purposes, the weighted average interest rate on the mortgages on our consolidated and unconsolidated properties maturing through December 31, 2027 is 4.43% and the weighted average interest rate on the 2025 Financings that were completed in December 2025 was 4.97%. 27 Table of Contents Results of Operations Comparison of Years Ended December 31, 2025 and 2024 The term "same store properties" refers to 21 multi-family properties with an aggregate of 5,420 units that were owned for all of 2025 and 2024.
Disclosure of Known Material Contractual Obligations The following table sets forth as of December 31, 2024 our known material contractual obligations: Payment Due by Period (Dollars in thousands) Less than 1 Year 1 - 3 Years 3 - 5 Years More than 5 Years Total Long-Term Debt Obligations (1) $ 55,313 $ 261,459 $ 202,473 $ 391,009 $ 910,254 Operating Lease Obligations 251 517 540 2,703 4,011 Purchase Obligations (2)(3) 6,615 13,230 13,230 — 33,075 Total $ 62,179 $ 275,206 $ 216,243 $ 393,712 $ 947,340 ____________________________ (1) Reflects payments of principal (including amortization payments) and interest and excludes deferred costs.
Disclosure of Known Material Contractual Obligations The following table sets forth as of December 31, 2025 our known material contractual obligations: Payment Due by Period (Dollars in thousands) Less than 1 Year 1 - 3 Years 3 - 5 Years More than 5 Years Total Long-Term Debt Obligations (1) Interest and Principal Amortization $ 40,133 $ 65,112 $ 48,033 $ 114,414 $ 267,692 Balloon Principal Payments (2) 88,677 171,485 75,655 384,440 720,257 Operating Lease Obligations 392 586 552 2,425 3,955 Purchase Obligations (3) (4) 6,082 12,164 12,164 — 30,410 Total $ 135,284 $ 249,347 $ 136,404 $ 501,279 $ 1,022,314 ____________________________ (1) Reflects payments of principal (including amortization payments) and interest and excludes deferred costs.
Baltimore; • $120,000 decrease due to a reduction in our investor relations activities; and • $127,000 decrease due primarily to the inclusion, in 2023, of the write off of a deposit related to a terminated transaction. Provision for credit loss In 2024, we recorded a non-cash provision of $270,000 related to the preferred equity investments.
Provision for credit loss In 2025, we recorded a non-cash provision of $5,000 related to the Loan Receivables ( i.e. the Preferred Equity Investments) in comparison to $270,000 recorded in 2024. Depreciation and amortization The increase is related to property improvements in 2025 and 2024.
Same store NOI decreased $163,000 in 2024 from 2023 due to the factors impacting NOI, other than the Yonkers' lease extension. See "-Results 35 Table of Contents of Operations -Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023" for a discussion of these changes.
Same store NOI decreased $138,000 in 2025 from 2024 primarily due to the factors impacting NOI, other than the Yonkers' Property.
The increase was offset by a $208,000 decrease in credit facility interest expense as we did not use the facility in 2024 and a $169,000 decrease due to reduced mortgage balances from amortization. General and administrative.
The increase was offset by a $375,000 decrease on our floating rate junior subordinated notes due to the decrease in SOFR and a $275,000 decrease of mortgage interest due to the impact of amortization of mortgage principal amounts. General and administrative.
Revenues The following table compares our revenues for the years indicated: (Dollars in thousands): 2024 2023 Change % Change Rental and other revenue from real estate properties $ 94,773 $ 93,069 $ 1,704 1.8 % Loan interest and other income 857 548 309 56.4 % Total revenues $ 95,630 $ 93,617 $ 2,013 2.2 % Rental and other revenue from real estate properties.
Revenues The following table compares our revenues for the years indicated: (Dollars in thousands): 2025 2024 Change % Change Rental and other revenue from real estate properties $ 95,265 $ 94,773 $ 492 0.5 % Loan interest and other income 1,763 857 906 105.7 % Total revenues $ 97,028 $ 95,630 $ 1,398 1.5 % Rental and other revenue from real estate properties The components of the increase include: • $510,000 due to a 0.74% net increase in average rental rates year-over-year, • $261,000 due to an increase in average occupancy year-over-year from 93.8% to 93.9%, • $149,000 in other rental income (tenant reimbursements such as trash and utilities); and • $114,000 increase at our commercial property in Yonkers, NY (the "Yonkers' Property") due to an increase in the rental rate obtained in connection with a lease extension.
The increase was offset by a: • $169,000 due to reduced amortization associated with RSUs that vest upon satisfaction of performance metrics based on adjusted funds from operations, as we do not currently anticipate achieving the minimum level required for the vesting of such awards; • $120,000 related to the reversal of a non-cash amortization expense on restricted stock awards forfeited by Mr.
The components of the decrease include $521,000 due to the reduction in the number of employees and the inclusion, in 2024, of $141,000 of expense related to the vesting of restricted stock units that vest based on the satisfaction of metrics related to adjusted funds from operations (the "AFFO Awards"); no expense was recorded with respect to the AFFO Awards outstanding in 2025 as such awards are not expected to vest.
Challenges and Uncertainties as a Result of the Uncertain Economic Environment; Pursuit of Joint Venture Acquisition and Alternative Investment Opportunities As more fully described below, we face challenges ( e.g ., inflation, volatile interest rates, over-supply in certain markets, rental rates decreases, mispriced ( i.e. ,cap rates that do not, in our belief, correlate appropriately to interest rates and other market factors), and limited acquisition opportunities) due to the uncertain economic environment, which limits our ability or willingness to (i) acquire properties, (ii) grow rental income or (iii) control our real estate operating expenses, some of which, such as real estate taxes and insurance expense, we have a very limited ability to control.
These challenges and uncertainties have, and we anticipate will continue to adversely impact (i) the rental and occupancy rates at our properties, and (ii) our ability to grow rental income and/or control our real estate operating expenses, some of which, such as real estate taxes, we have a very limited ability to control and frequently increase, with limited notice of the increase.
Removed
During 2024: • We invested, in two separate and unrelated transactions, an aggregate of $18.3 million (with a carrying value of $17.7 million at December 31, 2024, after giving effect to deferred loan fees and allowance for credit loss) in joint ventures that purchased a 204-unit multi-family property in Wilmington, North Carolina and a 184-unit multi-family property in Kennesaw, Georgia.
Added
During 2025: • we acquired, through two unconsolidated joint ventures in two separate and unrelated transactions, an 80% interest in two multi-family properties (referred to collectively as the "2025 Acquisitions") with an aggregate of 364 units for an aggregate purchase price of $59.5 million, including $40.1 million of mortgage debt.
Removed
These investments are unsecured and are subordinate, including the payment of the returns thereon, to an aggregate of $51.3 million of mortgage debt on these properties. We estimate that in 2025, we will generate approximately $1.2 million of interest income on these investments.
Added
The mortgage debt bears a weighted average interest rate of 4.34% and a weighted average remaining term to maturity of 6.6 years. . • we refinanced four mortgages maturing in 2025 and 2026 in aggregate principal amount of $58.0 million (the “Prior Mortgages”) and bearing a weighted average fixed interest rate of 4.38% with four replacement mortgages in aggregate principal amount $87.7 million (the "2025 Financings").
Removed
For financial statement reporting purposes, these investments are treated as loans and are included in "Loan receivables, net of deferred loan fees and allowance for credit loss"on our consolidated balance sheet at December 31, 2024.
Added
The replacement mortgages (the “Replacement Mortgages”) have a weighted average remaining term to maturity of 8.5 years, a weighted average fixed interest rate of 4.97%, and unlike the Prior Mortgages, are interest only until maturity (other than with respect to a mortgage in principal amount of $15.8 million, which is interest only until 2030, one year prior to its maturity).
Removed
See "Item 1 Business - Preferred Equity Investments" and Notes 1 and 5 to our consolidated financial statements. • We obtained a $27.4 million mortgage on our Woodland Trails-LaGrange, GA property (the "Woodlands Financing").
Added
Challenges and Uncertainties as a Result of the Uncertain Economic Environment We face challenges due to the uncertain national economic environment ( e.g. , inflation, recession and/or stagflation, the potential impact of tariffs and trade wars, and/or interest rates), and the oversupply of multi-family properties in several markets in which we compete (including Atlanta, GA, Huntsville, AL, Dallas, TX, San Antonio, TX, Nashville TN, Pensacola, FL, LaGrange, GA and San Marcos, TX).
Removed
The debt matures in September 2031, bears interest at a fixed rate of interest of 5.22% and is interest only until maturity. • We and an affiliate of Valley National Bank ("VNB") amended our credit facility to, among other things, reduce the borrowing capacity from $60 million to $40 million, extend the maturity from September 2025 to September 2027 and revise certain financial and other covenents.
Added
In addition, we use concessions (and in particular, in markets that are especially competitive) as a means to improve occupancy. The use of concessions reduces our rental income and adds to the variability of our operating results.
Removed
In addition, several properties, (in particular, Bells Bluff and Crossings), face increasing competition due to additional supply in such markets which have and may continue to adversely impact rental rates and occupancy rates.
Added
We anticipate that our mortgage interest expense will increase as we refinance the aggregate $154.6 million of principal balances of mortgage debt maturing through 2027 (including $84.0 million of such principal balances at unconsolidated subsidiaries) because current comparable mortgage interest rates are generally higher than the weighted average interest rate on such maturing mortgages.
Removed
In light of the challenging acquisition environment and the limited funds available to us to acquire properties, we are pursuing (i) alternative investments in the multi-family property arena, including preferred loan investments ( e.g. , an investment entitling us to a fixed rate of return prior to distributions to more junior investors) or bridge loans (e.g., a loan secured by a first mortgage on the subject property) and/or (ii) the acquisition of multi-family properties through joint ventures.
Added
The increase was offset primarily by a $532,000 decrease in revenue recognized from straight line adjustments of rent concessions, net of amortization, with approximately 50% related to Bells Bluff.
Removed
We do not anticipate that in the near term, these type of investments (other than joint ventures already included in our portfolio), will constitute a significant part of our portfolio, and can provide no assurance that such investments will be profitable. 27 Table of Contents Nashville/West Nashville, TN Properties - Bells Bluff and Crossings These properties (“Bells Bluff” and "Crossings") have experienced, and continue to experience, competitive pressure due to the completion of construction of similar or higher-quality multi-family properties in Nashville and West Nashville, TN.
Added
The components of the increase include: • increases of $564,000 and $476,000 in payroll and utilities (primarily water/sewer charges), respectively, at several properties; • $354,000 increase in other expenses, including $100,000 related to advertising and $90,000 related to a loan modification; and • a net $255,000 increase in real estate taxes at several properties. 28 Table of Contents Offsetting the change was a $927,000 decrease in insurance expense due to reduced premiums in 2025 (and we estimate that 2026 insurance premiums will be approximately $500,000 less in 2026 than in 2025) and a $221,000 reduction in repairs and maintenance expenses.
Removed
To maintain occupancy levels, we have offered, and anticipate that we will continue to offer, short-term rent concessions and/or reduced rental rates. As a result, Bells Bluff's and Crossing's operating results have been and will continue to be, adversely impacted.
Added
Interest expense Approximately $1 million of the increase is due to the $27.4 million mortgage obtained in August 2024 on Woodland Trails-La Grange, GA (the "Woodlands Financing"), $318,000 due to the 2025 Financings, and $237,000 due to increased draws on the credit facility.
Removed
The components of the increase include: • a $1.0 million increase due to a 1.3% increase in average rental rates year-over-year in the portfolio, • an $855,000 increase in straight line of rent concessions,net of amortization, with approximately 50% of such concessions from Bells Bluff and Crossings; and • a $112,000 increase at our commercial property in Yonkers due to a lease extension.
Added
The decrease was offset due to a (i) $272,000 increase in internal and external audit costs, including approximately $100,000 in out of scope audit costs expensed in 2025 for the 2024 audit, and (ii) $294,000 increase due to higher levels of employee compensation.
Removed
We estimate that these investments will generate an aggregate of $1.2 million of interest income in 2025.
Added
We estimate that through the quarter ending September 30, 2026, approximately $1 million of expense will be recognized in connection with the amortization of these intangibles. • $408,000 at same store properties, due to a decrease in operating margins ( i.e.,a decrease in rental revenues, a decrease in straight-line rent adjustments of rent concessions, net of amortization, and an increase in operating expense primarily due to increased payroll and repairs and maintenance expense).
Removed
The components of the increase include: • $669,000 in real estate taxes, including $413,000 at our Newbridge Commons-Columbus, OH property due to a reassessment, and smaller increases at several other properties; • $641,000 in insurance costs, including $380,000 due to increases in our insurance premiums under our master policy and $260,000 from two properties that are not part of our master policy; • $293,000 in utility costs (primarily water/sewer charges) at many properties; and • $189,000 primarily related to increased replacement costs at several properties. 29 Table of Contents We estimate that in 2025, assuming no material changes to our current multi-family portfolio, that our insurance expense will decrease by approximately $750,000 to $1.0 million due primarily to more favorable premiums.
Added
Insurance recovery of casualty loss During 2025, we received an aggregate of $313,000 from insurance recoveries primarily related to the Silvana Oaks and Avalon properties. There were no comparable recoveries in 2024. Gain on sale of real estate In 2025, we sold a cooperative apartment in New York for a sales price of $995,000 and a gain of $755,000.
Removed
Interest expense The increase is due primarily to the additional $566,000 of interest expense related to the Woodlands Financing which took place in 2024, $155,000 from the Silvana Oaks financing which took place in 2023 and $91,000 due to an increased interest rate on our junior subordinated notes.
Added
The increase was offset by a: • $1.5 million increase in interest expense; • $607,000 decrease in straight line rent concessions, net of amortization; • $400,000 increase in income tax expense; and • $119,000 increase in general and administrative expense (excluding the impact of equity based compensation).
Removed
The components of the increase include: • $319,000 increase in non-cash restricted stock amortization, including $171,000 due to the higher price of the restricted stock awarded in 2024 in comparison to awards granted in prior years, and $147,000 due to the accelerated vesting of restricted stock awards of Ryan Baltimore, our former chief operating officer, who resigned in December 2024 to pursue another employment opportunity; and • $223,000 in cash compensation costs due to higher levels of compensation.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+0 added−0 removed1 unchanged
Biggest changeItem 7A. Quantitative and Qualitative Disclosures About Market Risk. All of our mortgage debt bears interest at fixed rates. Our credit facility bears interest at 30 day term SOFR plus 250 basis points, with an interest rate floor of 6%. At December 31, 2024, no amounts were drawn on the facility.
Biggest changeItem 7A. Quantitative and Qualitative Disclosures About Market Risk. All of our mortgage debt (other than $6.5 million in principal amount of construction financing at Stono Oaks) bears interest at fixed rates. Our credit facility bears interest at 30 day term SOFR plus 250 basis points, with an interest rate floor of 6%.
Our junior subordinated notes bear interest at the rate of three-month term SOFR plus 226 basis points. At December 31, 2024, the interest rate on these notes was 6.85%.
At December 31, 2025, no amounts were drawn on the facility. Our junior subordinated notes bear interest at the rate of three-month term SOFR plus 226 basis points. At December 31, 2025, the interest rate on these notes was 6.1%.

Other BRT 10-K year-over-year comparisons