Alpine Income Property Trust Swings to Loss Amid Rising Impairment, Interest Costs

TL;DR

**PINE's Q3 loss is a red flag; rising interest and impairment costs are eating into revenue gains, making it a risky bet right now.**

AI Summary

Alpine Income Property Trust, Inc. (PINE) reported a significant net loss of $1.423 million for the three months ended September 30, 2025, a sharp decline from a net income of $3.354 million in the same period of 2024. For the nine months ended September 30, 2025, the company posted a net loss of $4.483 million, compared to a net income of $3.293 million in the prior year. Total revenues increased to $14.563 million for the quarter, up from $13.480 million year-over-year, and to $43.632 million for the nine months, up from $38.436 million. This revenue growth was primarily driven by increased lease income and interest income from commercial loans and investments. However, operating expenses surged, with a notable provision for impairment of $1.915 million for the quarter (up from $422,000) and $6.749 million for the nine months (up from $1.110 million). Interest expense also rose significantly to $3.910 million for the quarter and $11.822 million for the nine months, reflecting increased debt. The company's strategic outlook includes continued investment in real estate, with acquisitions totaling $67.514 million in the nine months ended September 30, 2025, alongside $32.644 million in asset dispositions.

Why It Matters

PINE's shift from net income to a substantial net loss, driven by increased impairment charges and higher interest expenses, signals potential headwinds for investors. While revenue growth from lease income and commercial loans is positive, the escalating costs could erode future profitability and dividend sustainability, impacting investor returns. The competitive landscape for net lease properties and commercial loans means PINE must manage its cost structure effectively to maintain its market position. Employees and customers may see indirect impacts through potential operational adjustments or changes in investment strategy if financial performance continues to decline, while the broader market will watch how rising interest rates affect other REITs with similar debt profiles.

Risk Assessment

Risk Level: high — The company reported a net loss of $1.423 million for the three months ended September 30, 2025, a significant reversal from a $3.354 million net income in the prior year. This loss is exacerbated by a substantial increase in the provision for impairment, which jumped from $422,000 to $1.915 million quarter-over-quarter, and a rise in interest expense from $3.167 million to $3.910 million, indicating higher borrowing costs and potential asset value concerns.

Analyst Insight

Investors should exercise caution and thoroughly review PINE's debt maturity schedule and asset quality. Consider reducing exposure or holding off on new investments until there's clear evidence of improved profitability and a reduction in impairment charges and interest expense pressure.

Financial Highlights

debt To Equity

1.54

revenue

$14,563,000

operating Margin

N/A

total Assets

$621,424,000

total Debt

$358,155,000

net Income

-$1,423,000

eps

N/A

gross Margin

N/A

cash Position

$1,183,000

revenue Growth

+8.0%

Revenue Breakdown

Key Numbers

• $1.423M — Net Loss (for the three months ended September 30, 2025, compared to $3.354M net income in 2024)
• $4.483M — Net Loss (for the nine months ended September 30, 2025, compared to $3.293M net income in 2024)
• $14.563M — Total Revenues (for the three months ended September 30, 2025, up from $13.480M in 2024)
• $6.749M — Provision for Impairment (for the nine months ended September 30, 2025, significantly up from $1.110M in 2024)
• $11.822M — Interest Expense (for the nine months ended September 30, 2025, up from $8.933M in 2024)
• $67.514M — Acquisition of Real Estate (for the nine months ended September 30, 2025, indicating continued investment)
• $358.155M — Long-Term Debt—Net (as of September 30, 2025, up from $301.466M as of December 31, 2024)
• 14,164,662 — Common Shares Outstanding (as of October 16, 2025)

Key Players & Entities

• Alpine Income Property Trust, Inc. (company) — registrant
• CTO Realty Growth, Inc. (company) — external manager's parent company
• John P. Albright (person) — executive officer and director of Alpine Income Property Trust, Inc. and CTO Realty Growth, Inc.
• Alpine Income Property Manager, LLC (company) — external manager
• Alpine Income Property OP, LP (company) — operating partnership
• Alpine Income Property GP, LLC (company) — sole general partner of the Operating Partnership
• Securities and Exchange Commission (regulator) — filing oversight
• New York Stock Exchange (regulator) — exchange where common stock is registered

FAQ

Risk Factors

• Increased Provision for Impairment [high — financial]: The provision for impairment surged to $1.915 million for the three months ended September 30, 2025, a significant increase from $422,000 in the prior year. For the nine-month period, it rose to $6.749 million from $1.110 million. This indicates potential deterioration in the value of the company's real estate assets or commercial loans.
• Rising Interest Expense [high — financial]: Interest expense increased to $3.910 million for the quarter and $11.822 million for the nine months ended September 30, 2025. This is directly linked to the substantial increase in long-term debt, which grew from $301.466 million at the end of 2024 to $358.155 million as of September 30, 2025.
• Asset Dispositions [medium — market]: The company engaged in asset dispositions totaling $32.644 million during the nine months ended September 30, 2025. While this can be a strategy to optimize the portfolio, significant dispositions might signal challenges in certain market segments or a need to deleverage.
• External Management Structure [medium — operational]: The company is externally managed by Alpine Income Property Manager, LLC, a subsidiary of CTO Realty Growth, Inc. This structure, where executive officers also serve CTO, could present potential conflicts of interest or dependencies on the manager's performance.
• Net Loss Position [high — financial]: The company reported a net loss of $1.423 million for the three months ended September 30, 2025, a stark contrast to a net income of $3.354 million in the prior year. The nine-month period also resulted in a net loss of $4.483 million, compared to a net income of $3.293 million. This shift to losses is a significant concern.

Industry Context

Alpine Income Property Trust, Inc. operates within the net lease REIT sector, which is characterized by long-term leases where tenants bear most property operating expenses. The sector generally offers stable income streams, but is sensitive to interest rate environments and tenant creditworthiness. Recent performance indicates a challenging period for PINE, with increased operating expenses and a shift to net losses, despite revenue growth.

Regulatory Implications

As a publicly traded REIT, PINE is subject to SEC regulations and accounting standards (GAAP). The significant increase in impairment charges and debt levels may attract scrutiny from investors and analysts regarding asset quality and financial risk management. Compliance with reporting requirements is crucial.

What Investors Should Do

1. Analyze the drivers of the increased provision for impairment.
2. Scrutinize the impact of rising interest expenses on profitability.
3. Evaluate the sustainability of revenue growth in light of increased expenses.
4. Monitor future acquisition and disposition activities.

Key Dates

• 2025-09-30: Quarterly Report Filing (10-Q) — Provides updated financial performance and operational details for the period ending September 30, 2025, revealing a significant net loss and increased expenses.
• 2025-09-30: Consolidated Balance Sheet Date — Shows an increase in total assets to $621.424 million and a substantial rise in long-term debt to $358.155 million.
• 2024-12-31: Previous Fiscal Year End Balance Sheet — Serves as a baseline for comparison, showing long-term debt of $301.466 million and positive net income in the prior year's comparable periods.

Glossary

Net Lease

A type of commercial real estate lease where the tenant is responsible for paying most or all of the operating expenses of the property, including property taxes, insurance, and maintenance. (PINE's portfolio primarily consists of net leased properties, which impacts its revenue and expense structure.)

Provision for Impairment

An accounting charge that reflects a reduction in the carrying value of an asset when its fair value is less than its book value. This can occur due to economic conditions, property damage, or other factors. (A significant increase in this provision ($1.915 million for the quarter) indicates potential issues with the value of PINE's real estate or loan assets.)

Commercial Loans and Investments

Loans made by the company to businesses or individuals, often secured by real estate, and other investment-like financial instruments. (PINE has a growing portfolio of these assets ($102.772 million as of Sept 30, 2025), contributing to both interest income and potential impairment risks.)

External Management

A business structure where a company hires an external firm to manage its operations, rather than having an in-house management team. This is common for REITs. (PINE is externally managed by a subsidiary of CTO Realty Growth, Inc., which is a key aspect of its operational structure.)

Accumulated Depreciation

The total amount of depreciation expense that has been recorded for an asset since it was put into use. It reduces the book value of an asset on the balance sheet. (The increase in accumulated depreciation reflects the ongoing use and aging of PINE's real estate assets.)

Year-Over-Year Comparison

Compared to the prior year's comparable periods, Alpine Income Property Trust, Inc. has experienced a significant deterioration in profitability, shifting from net income to net losses for both the three and nine months ended September 30, 2025. While total revenues have grown, driven by lease and interest income, operating expenses have surged, particularly the provision for impairment and interest expense, reflecting increased debt levels. Total assets have grown to $621.424 million, but this is accompanied by a substantial increase in long-term debt to $358.155 million, raising concerns about financial leverage and risk.

Key Financial Figures

• $0.01 — ge on which registered: COMMON STOCK, $0.01 PAR VALUE PINE NYSE Indicate by c

Filing Documents

• pine-20250930x10q.htm (10-Q) — 2693KB
• pine-20250930xex31d1.htm (EX-31.1) — 15KB
• pine-20250930xex31d2.htm (EX-31.2) — 15KB
• pine-20250930xex32d1.htm (EX-32.1) — 9KB
• pine-20250930xex32d2.htm (EX-32.2) — 9KB
• 0001104659-25-101839.txt ( ) — 13108KB
• pine-20250930.xsd (EX-101.SCH) — 94KB
• pine-20250930_cal.xml (EX-101.CAL) — 103KB
• pine-20250930_def.xml (EX-101.DEF) — 317KB
• pine-20250930_lab.xml (EX-101.LAB) — 723KB
• pine-20250930_pre.xml (EX-101.PRE) — 567KB
• pine-20250930x10q_htm.xml (XML) — 2831KB

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements 3 Consolidated Balance Sheets – September 30, 2025 (Unaudited) and December 31, 2024 3 Consolidated Statements of Operations – Three and nine months ended September 30, 2025 and 2024 (Unaudited) 4 Consolidated Statements of Comprehensive Income – Three and nine months ended September 30, 2025 and 2024 (Unaudited) 5 Consolidated Statements of Stockholders' Equity – Three and nine months ended September 30, 2025 and 2024 (Unaudited) 6 Consolidated Statements of Cash Flows – Nine months ended September 30, 2025 and 2024 (Unaudited) 8

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 10

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 40

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 50

Controls and Procedures

Item 4. Controls and Procedures 50

—OTHER INFORMATION

PART II—OTHER INFORMATION 50

Legal Proceedings

Item 1. Legal Proceedings 50

Risk Factors

Item 1A. Risk Factors 51

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 51

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 51

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 51

Other Information

Item 5. Other Information 51

Exhibits

Item 6. Exhibits 52

SIGNATURES

SIGNATURES 53 2 Table of Contents

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS ALPINE INCOME PROPERTY TRUST, INC. CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share data) As of September 30, 2025 (Unaudited) December 31, 2024 ASSETS Real Estate: Land, at Cost $ 151,500 $ 147,912 Building and Improvements, at Cost 350,299 341,955 Total Real Estate, at Cost 501,799 489,867 Less, Accumulated Depreciation ( 53,955 ) ( 45,850 ) Real Estate—Net 447,844 444,017 Assets Held for Sale 9,816 2,254 Commercial Loans and Investments 102,772 89,629 Cash and Cash Equivalents 1,183 1,578 Restricted Cash 5,455 6,373 Intangible Lease Assets—Net 41,788 43,925 Straight-Line Rent Adjustment 1,936 1,485 Other Assets 10,630 15,734 Total Assets $ 621,424 $ 604,995 LIABILITIES AND EQUITY Liabilities: Accounts Payable, Accrued Expenses, and Other Liabilities $ 8,938 $ 8,445 Prepaid Rent and Deferred Revenue 5,310 2,412 Intangible Lease Liabilities—Net 3,804 4,774 Obligation Under Participation Agreement — 11,403 Long-Term Debt—Net 358,155 301,466 Total Liabilities 376,207 328,500 Commitments and Contingencies—See Note 20 Equity: Preferred Stock, $ 0.01 par value per share, 100 million shares authorized, no shares issued and outstanding as of September 30, 2025 and December 31, 2024 — — Common Stock, $ 0.01 par value per share, 500 million shares authorized, 14,158,190 shares issued and outstanding as of September 30, 2025 and 14,691,982 shares issued and outstanding as of December 31, 2024 142 147 Additional Paid-in Capital 253,162 261,831 Dividends in Excess of Net Income ( 32,067 ) ( 15,722 ) Accumulated Other Comprehensive Income 2,292 6,771 Stockholders' Equity 223,529 253,027 Noncontrolling Interest 21,688 23,468 Total Equity 245,217 276,495 Total Liabilities and Equity $ 621,424 $ 604,995 The accompanying notes are an integral part of these consolidated fin

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1. BUSINESS AND ORGANIZATION

BUSINESS

BUSINESS Alpine Income Property Trust, Inc. (the "Company" or "PINE") is a real estate investment trust ("REIT") that owns and operates a high-quality portfolio of commercial net lease properties. The terms "us," "we," "our," and "the Company" as used in this report refer to Alpine Income Property Trust, Inc. together with our consolidated subsidiaries. Our income property portfolio consists of 128 net leased properties located in 34 states. The properties in our portfolio are primarily subject to long-term, net leases, which generally require the tenant to pay directly or reimburse us for property operating expenses such as real estate taxes, insurance, assessments and other governmental fees, utilities, repairs and maintenance and certain capital expenditures. The Company may also acquire or originate commercial loans and investments. Our investments in commercial loans are generally secured by real estate or the borrower's pledge of its ownership interest in an entity that owns real estate. As more fully described in Note 4, "Commercial Loans and Investments," the three Tampa Properties (defined in Note 4 below), which were purchased during the year ended December 31, 2024 through a sale-leaseback transaction that includes a tenant repurchase option are, for GAAP purposes, accounted for as a financing arrangement. However, because the Tampa Properties constitute real estate assets for both legal and tax purposes, we include the Tampa Properties in the property portfolio when describing our property portfolio and for purposes of providing statistics related thereto. The Company operates in two primary business segments: income properties and commercial loans and investments. The Company has no employees and is externally managed by Alpine Income Property Manager, LLC, a Delaware limited liability company and a wholly owned subsidiary of CTO Realty Growth, Inc. (our "Manager"). CTO Realty Growth, Inc. (NYSE: CTO) is a Maryland corporation that is a publicly t

View Full Filing

View this 10-Q filing on SEC EDGAR