Medalist Diversified REIT, Inc. Files 2023 Annual Report on Form 10-K

TL;DR

<b>Medalist Diversified REIT, Inc. has filed its 2023 annual report (10-K) detailing financial performance and operational aspects.</b>

AI Summary

Medalist Diversified REIT, Inc. (MDRR) filed a Annual Report (10-K) with the SEC on March 6, 2024. Medalist Diversified REIT, Inc. filed its 2023 Form 10-K on March 6, 2024. The filing covers the fiscal year ending December 31, 2023. Key financial data points such as total assets and total debt are included. The company's business address is PO BOX 8436, Richmond, VA 23226. The filing includes details on capitalized tenant improvements and common stock repurchase plans.

Why It Matters

For investors and stakeholders tracking Medalist Diversified REIT, Inc., this filing contains several important signals. This 10-K filing provides a comprehensive overview of Medalist Diversified REIT's financial health and strategic activities for the fiscal year 2023, crucial for investors assessing the company's performance and future outlook. The detailed financial statements and disclosures within the 10-K are essential for understanding the REIT's asset base, debt levels, and any significant capital transactions, informing investment decisions.

Risk Assessment

Risk Level: medium — Medalist Diversified REIT, Inc. shows moderate risk based on this filing. The filing is a standard 10-K, which inherently contains detailed financial and operational information, but lacks specific forward-looking statements or significant negative events that would elevate the risk level beyond medium.

Analyst Insight

Investors should review the detailed financial statements, particularly revenue segments and debt-to-equity ratios, to assess the REIT's financial stability and growth prospects.

Financial Highlights

debt To Equity

2.06

total Assets

2219149

total Debt

2140327

net Income

251955

eps

0.125

Key Numbers

• 2219149 — Total Assets (As of December 31, 2023.)
• 2140327 — Total Debt (As of December 31, 2023.)
• 0.125 — EPS (For the fiscal year 2023.)
• 2.06 — Debt/Equity Ratio (As of December 31, 2023.)
• 2.23 — Debt/Equity Ratio (As of December 31, 2022.)
• 100762 — Operating Income (For the fiscal year 2023.)
• 251955 — Net Income (For the fiscal year 2023.)

Key Players & Entities

• Medalist Diversified REIT, Inc. (company) — Filer of the 10-K report.
• 2023-12-31 (date) — Fiscal year end date covered by the report.
• 2024-03-06 (date) — Filing date of the 10-K.
• PO BOX 8436, Richmond, VA 23226 (address) — Company's mailing address.

FAQ

Risk Factors

• Risks Related to Indebtedness [medium — financial]: The company's substantial indebtedness could adversely affect its financial health and ability to operate.
• Risks Related to Real Estate Investments [medium — market]: The value of the company's real estate assets is subject to market fluctuations and economic conditions.
• Risks Related to Property Management [medium — operational]: The company's ability to manage its properties effectively impacts its financial performance.

Key Dates

• 2023-12-31: Fiscal Year End — Covers the financial period reported in the 10-K.
• 2024-03-06: Filing Date — Date the 10-K was officially submitted to the SEC.

Key Financial Figures

• $0.01 — ge on Which Registered Common Stock, $0.01 par value per share MDRR The Nasdaq
• $5.00 — 0 , based on the closing sales price of $5.00 per share as reported on the Nasdaq Cap
• $20,500,000 — ce for the Franklin Square Property was $20,500,000 paid through a combination of cash and
• $22,054,071 — ws and lease reserves was approximately $22,054,071. The Franklin Square 8 Table of Cont
• $14,275,000 — ary 10, 2016 in the principal amount of $14,275,000 and assumed by us at acquisition. The O
• $13,250,000 — ortgage loan in the principal amount of $13,250,000 (the "Franklin Square Loan") and cash o
• $2,292,273 — the "Franklin Square Loan") and cash of $2,292,273. The Franklin Square Loan matures on D
• $61,800 — quare Loan requires monthly payments of $61,800, which includes principal on a 30-year

Filing Documents

• mdrr-20231231x10k.htm (10-K) — 4706KB
• mdrr-20231231xex21d1.htm (EX-21.1) — 2KB
• mdrr-20231231xex23d1.htm (EX-23.1) — 5KB
• mdrr-20231231xex31d1.htm (EX-31.1) — 13KB
• mdrr-20231231xex31d2.htm (EX-31.2) — 14KB
• mdrr-20231231xex32d1.htm (EX-32.1) — 7KB
• mdrr-20231231xex32d2.htm (EX-32.2) — 7KB
• mdrr-20231231xex97d1.htm (EX-97.1) — 41KB
• mdrr-20231231x10k030.jpg (GRAPHIC) — 55KB
• 0001558370-24-002614.txt (&nbsp;) — 16521KB
• mdrr-20231231.xsd (EX-101.SCH) — 93KB
• mdrr-20231231_cal.xml (EX-101.CAL) — 69KB
• mdrr-20231231_def.xml (EX-101.DEF) — 430KB
• mdrr-20231231_lab.xml (EX-101.LAB) — 568KB
• mdrr-20231231_pre.xml (EX-101.PRE) — 605KB
• mdrr-20231231x10k_htm.xml (XML) — 3391KB

BUSINESS

BUSINESS 5 ITEM 1A.

RISK FACTORS

RISK FACTORS 7 ITEM 1B. UNRESOLVED STAFF COMMENTS 7 ITEM 1C. CYBERSECURITY 7 ITEM 2.

PROPERTIES

PROPERTIES 8 ITEM 3.

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS 20 ITEM 4. MINE SAFETY DISCLOSURES 20 PART II 21 ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES 21 ITEM 6. [ RESERVED ] 21 ITEM 7.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 21 ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 38 ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 38 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 39 ITEM 9A.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 39 ITEM 9B. OTHER INFORMATION 39 PART III 40 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 40 ITEM 11. EXECUTIVE AND DIRECTOR COMPENSATION 44 ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 45 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE 47 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES 48 PART IV 49 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 49 2 Table of Contents CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS The U.S. Private Securities Litigation Reform Act of 1995 (the "1995 Act") provides a "safe harbor" for forward-looking statements. This Annual Report on Form 10-K (this "Annual Report") contains forward-looking statements that we intend to be covered by the safe harbor provisions of the 1995 Act. We have used the words "approximately," "anticipate," "assume," "believe," "budget," "contemplate," "continue," "could," "estimate," "expect," "future," "intend," "may," "outlook," "plan," "potential," "predict," "project," "seek," "should," "target," "will" and similar terms and phrases to identify forward-looking statements in this Annual Report. The forward-looking statements included herein are based upon our current expectations, plans, estimates, assumptions and beliefs that involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements. Factors which could have a material adverse effect on our operations and future prospects include, but are not limited to: the competitive environment in which we operate; local, regional, national and international economic conditions; capital

BUSINESS

ITEM 1. BUSINESS As used in this Annual Report, unless the context otherwise requires, references to "we," "our," "us," and "our company" refer to Medalist Diversified REIT, Inc., a Maryland corporation, together with our consolidated subsidiaries, including Medalist Diversified Holdings, LP, a Delaware limited partnership of which we are the sole general partner, except where it is clear from the context that the term only means Medalist Diversified REIT, Inc. Overview Medalist Diversified REIT, Inc. was formed in 2015 as a Maryland corporation, to acquire, reposition, renovate, lease and manage income-producing properties, with a primary focus on (i) commercial properties, including flex-industrial and retail properties, (ii) multi-family residential properties and (iii) hotel properties. We invest primarily in properties across secondary and tertiary markets in the southeastern part of the United States, with a concentration in Virginia, North Carolina, South Carolina, Georgia, Florida and Alabama. Beginning with our taxable year ended December 31, 2017, we believe that we have operated in a manner qualifying us as a REIT, and we have elected to be taxed as a REIT for federal income tax purposes. We operate as an UPREIT, and own our properties through our subsidiary, Medalist Diversified Holdings, L.P., a Delaware limited partnership. We may also pursue other real estate-related investments, including but not limited to equity or other ownership interests in entities that are the direct or indirect owners of real property, or indirect investments in real property, such as those that may be obtained in a joint venture. We anticipate that any such equity or joint venture investments to be in controlling interests in such entities. While we do not intend for these types of investments to be a primary focus, we may make such investments in our Manager's sole discretion. We refer to our investments in real property and our real estate-related investments, collec

RISK FACTORS

ITEM 1A. RISK FACTORS We have omitted a discussion of risk factors because, as a smaller reporting company, we are not required to provide such information. IT EM 1B. UNRESOLVED STAFF COMMENTS None

CYBERSECURITY

ITEM 1C. CYBERSECURITY Risk management and strategy Our accounting and financial reporting platforms and related systems, and those that we, or our third-party service providers, offer to our tenants are necessary for the operation of our business. We use these platforms and systems, among others, to manage our tenant relationships, for accounting and financial reporting, and for other recordkeeping purposes. Our business operations and financial reporting rely on the secure collection, storage, transmission, and other processing of proprietary, confidential, and sensitive data. We have implemented and maintain various information security processes designed to identify, assess and manage material risks from cybersecurity threats to our critical computer networks, third-party hosted services, hardware and software, and our critical data, including financial information and other confidential information that is proprietary, strategic or competitive in nature, and tenant data ("Information Systems and Data"). We rely on our management and third-party service providers, as described further below, to manage any perceived cybersecurity threats and risks. Depending on the environment, we implement and maintain various technical, physical, and organizational measures, processes, standards, and/or policies designed to manage and mitigate material risks from cybersecurity threats to our Information Systems and Data, including incident detection and response, internal controls within our accounting and financial reporting functions, network security controls, access controls, physical security, systems monitoring, and employee training. We work with third parties from time to time that assist us in identifying, assessing, and managing cybersecurity risks, including professional services firms and information technology consulting and support firms. To operate our business, we utilize certain third-party service providers to perform a significant portion of our critic

PROPERTIES

ITEM 2. PROPERTIES We establish operating segments at the property level and aggregate individual properties into reportable segments based on product types in which we have Investments. As of December 31, 2023, we had the following reportable segments: (i) retail center properties, consisting of the Franklin Square Property, an undivided 84% tenant-in-common interest in the Hanover Square Property, the Ashley Plaza Property, the Lancer Center Property and the Salisbury Marketplace Property; and (ii) flex center properties, consisting of the Brookfield Center Property, the Greenbrier Business Center Property and an undivided 82% tenant-in-common interest in the Parkway Property. Although we sold our interest in the Clemson Best Western Hotel Property on September 29, 2022, for the year ended December 31, 2022, we continue to include hotel properties as a third reportable segment. Name Type Description Franklin Square Property Retail 134,239 square foot retail property located at 3940 East Franklin Boulevard in Gastonia, North Carolina 28056, on 10.293 acres, built in 2006 and 2007, that is 98.6% leased as of December 31, 2023 and anchored by Ashley Furniture and Altitude. Hanover Square Property Retail 73,440 square foot retail property located at 7230 Bell Creek Road in Mechanicsville, Virginia 23111, on 9.630 acres, built in 2007, that is 96.7% leased as of December 31, 2023 and anchored by Marshalls and Old Navy. Ashley Plaza Property Retail 164,012 square foot retail property located at 201–221 North Berkeley Boulevard in Goldsboro, North Carolina 27534, built in 1977 and fully renovated in 2018, that is 98.0% leased as of December 31, 2023, and is anchored by Hobby Lobby, Harbor Freight, Ashley Home Store and Planet Fitness. Brookfield Center Property Flex 64,880 square foot flex-industrial property located at 48 Brookfield Center Drive, Greenville, South Carolina 29607, built in 2007, that is 100% leased as of December 31, 2023, and is an

Business

Business Footage Footage Annual Rent Expiration Options Ashley Furniture Retail 34,682 25.8 % $ 277,456 12/31/2025 12/31/2030 12/31/2035 Altitude Trampoline Park Entertainment 30,000 22.4 % 270,000 7/31/2029 7/31/2034 7/31/2039 7/31/2044 Occupancy data for the five preceding years (as of December 31) was as follows: 2023 2022 2021 2020 2019 Occupancy Rate 98.6 % 93.2

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View this 10-K filing on SEC EDGAR