Presidio Property Trust Narrows Loss Amid Asset Sales, Impairments

TL;DR

**SQFTW is shedding assets and cutting losses, but watch those impairments – a turnaround or just treading water?**

AI Summary

Presidio Property Trust, Inc. (SQFTW) reported a net loss attributable to common stockholders of $4.16 million for the six months ended June 30, 2025, a significant improvement from the $18.16 million loss in the prior-year period. Total revenue decreased to $8.50 million for the first six months of 2025, down from $9.38 million in the same period of 2024, primarily due to a reduction in rental income. The company experienced a substantial increase in impairment of goodwill and real estate assets, rising to $4.34 million in H1 2025 from $196,793 in H1 2024. However, this was offset by a significant gain on sales of real estate, net, which surged to $4.78 million in H1 2025 from $2.83 million in H1 2024, and a reduced net loss in Conduit Pharmaceuticals marketable securities, falling to $184,459 from $13.89 million. Total assets declined to $128.40 million as of June 30, 2025, from $142.57 million at December 31, 2024, largely due to a decrease in real estate assets held for sale from $22.19 million to $7.29 million. The company also repurchased $1.53 million of Series A Common Stock and $327,787 of Series D Preferred Stock during the six months ended June 30, 2025.

Why It Matters

This filing reveals Presidio Property Trust is actively managing its portfolio through asset sales and stock repurchases, which could signal a strategic shift to optimize its real estate holdings and improve shareholder value. The significant reduction in net loss, despite lower revenue, suggests improved operational efficiency and a more favorable outcome from its Conduit Pharmaceuticals investment compared to the previous year. For investors, the increased impairment charges on goodwill and real estate assets indicate potential underlying issues with certain properties or a re-evaluation of asset values, which could impact future profitability and competitive standing in the real estate market. Employees and customers might see stability if the company's financial health continues to improve, but the declining asset base warrants close monitoring.

Risk Assessment

Risk Level: medium — The company reported a significant impairment of goodwill and real estate assets totaling $4.34 million for the six months ended June 30, 2025, up from $196,793 in the prior year, indicating potential overvaluation or underperformance of certain assets. Total assets decreased by over $14 million from December 31, 2024, to June 30, 2025, reflecting a shrinking asset base. While the net loss improved, the substantial impairment charges and declining total assets suggest ongoing challenges in asset valuation and portfolio management.

Analyst Insight

Investors should closely monitor Presidio Property Trust's future asset disposition strategies and the impact of these sales on long-term revenue generation. Evaluate the specific properties subject to impairment to understand if these are isolated incidents or indicative of broader portfolio weakness. Consider the company's ability to generate sustainable cash flow from its remaining properties to cover dividends and debt obligations.

Key Numbers

• $4.16M — Net Loss Attributable to Common Stockholders (Decreased from $18.16M in H1 2024, a significant improvement.)
• $8.50M — Total Revenue (Decreased from $9.38M in H1 2024, indicating lower rental income.)
• $4.34M — Impairment of Goodwill and Real Estate Assets (Increased significantly from $196,793 in H1 2024, signaling asset revaluation.)
• $4.78M — Gain on Sales of Real Estate, Net (Increased from $2.83M in H1 2024, contributing to loss reduction.)
• $184,459 — Net Loss in Conduit Pharmaceuticals Marketable Securities (Substantially reduced from $13.89M in H1 2024, a major positive swing.)
• $128.40M — Total Assets (Decreased from $142.57M at Dec 31, 2024, reflecting asset sales.)
• $7.29M — Real Estate Assets Held for Sale, Net (Decreased from $22.19M at Dec 31, 2024, indicating significant sales activity.)
• $1.53M — Repurchase of Series A Common Stock (Executed during H1 2025, impacting outstanding shares.)
• $327,787 — Repurchase of Series D Preferred Stock (Executed during H1 2025, impacting preferred equity.)
• $5.13 — Net Loss Per Share (Basic & Diluted) for Q2 2025 (Improved from $9.97 in Q2 2024.)

Key Players & Entities

• Presidio Property Trust, Inc. (company) — registrant
• Conduit Pharmaceuticals (company) — investment
• Nasdaq Stock Market LLC (regulator) — exchange for listed securities
• Securities and Exchange Commission (regulator) — filing oversight
• $4.16 million (dollar_amount) — net loss attributable to common stockholders for H1 2025
• $18.16 million (dollar_amount) — net loss attributable to common stockholders for H1 2024
• $8.50 million (dollar_amount) — total revenue for H1 2025
• $9.38 million (dollar_amount) — total revenue for H1 2024
• $4.34 million (dollar_amount) — impairment of goodwill and real estate assets for H1 2025
• $4.78 million (dollar_amount) — gain on sales of real estate, net, for H1 2025

FAQ

Key Financial Figures

• $0.01 — ock , SQFT The Nasdaq Stock Market LLC $0.01 par value per share 9.375% Series D C
• $10.3 million — cember 31, 2024, includes approximately $10.3 million and $11.4 million, respectively, of ass
• $11.4 m — ncludes approximately $10.3 million and $11.4 million, respectively, of assets related
• $0.10 — stment post 1 for 10 reverse split from $0.10 to $0.01 — — 505 ( 96,206 ) 9

Filing Documents

• sqft20250630_10q.htm (10-Q) — 2115KB
• ex_822748.htm (EX-31.1) — 13KB
• ex_822749.htm (EX-31.2) — 12KB
• ex_822750.htm (EX-32.1) — 7KB
• 0001437749-25-026786.txt ( ) — 11238KB
• sqft-20250630.xsd (EX-101.SCH) — 78KB
• sqft-20250630_cal.xml (EX-101.CAL) — 57KB
• sqft-20250630_def.xml (EX-101.DEF) — 647KB
• sqft-20250630_lab.xml (EX-101.LAB) — 433KB
• sqft-20250630_pre.xml (EX-101.PRE) — 665KB
• sqft20250630_10q_htm.xml (XML) — 2409KB

FINANCIAL INFORMATION

Part I. FINANCIAL INFORMATION: 5

FINANCIAL STATEMENTS

Item 1. FINANCIAL STATEMENTS: 5 Consolidated Balance Sheets as of June 30, 2025 (unaudited) and December 31, 2024 5 Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024 (unaudited) 6 Consolidated Statements of Changes in Equity for the Three and Six Months Ended June 30, 2025 and 2024 (unaudited) 7 Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 (unaudited) 8

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 9

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 35

Quantitative and Qualitative Disclosures about Market Risk

Item 3. Quantitative and Qualitative Disclosures about Market Risk 45

Controls and Procedures

Item 4. Controls and Procedures 45

OTHER INFORMATION

Part II. OTHER INFORMATION 46

Legal Proceedings

Item 1. Legal Proceedings 46

Risk Factors

Item 1A. Risk Factors 46

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 46

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 48

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 48

Other Information

Item 5. Other Information 48

Exhibits

Item 6. Exhibits 49

Signatures

Signatures 50 2 Table of Contents CAUTIONARY LANGUAGE REGARDING FORWARD-LOOKING STATEMENTS This report contains "forward-looking statements" within the meaning of the federal securities laws that involve risks and uncertainties, many of which are beyond our control. Our actual results could differ materially and adversely from those anticipated in such forward-looking statements as a result of certain factors, including those set forth in this report and in our other filings with the Securities and Exchange Commission (the "SEC"). Forward-looking statements relate to matters such as our industry, business strategy, goals and expectations concerning our market position, future operations, margins, profitability, capital expenditures, financial condition, liquidity, capital resources, cash flows, results of operations and other financial and operating information. Forward-looking statements included in this report include, but are not limited to, statements regarding purchases and sales of properties, plans for financing and refinancing our properties, the adequacy of our capital resources, changes to the markets in which we operate, our business plans and strategies, and our payment of dividends. When used in this report, the words "will," "may," "believe," "anticipate," "intend," "estimate," "expect," "should," "project," "plan," and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Important factors that may cause actual results to differ from projections include, but are not limited to: inherent risks associated with real estate investments and with the real estate industry; significant competition may decrease or prevent increases in our properties' occupancy and rental rates and may reduce the value of our properties; a decrease in demand for commercial space and model homes and/or an increase in operating costs; failure by any major tenant (or a subs

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION

Financial Statements

ITEM 1. Financial Statements Presidio Property Trust, Inc. and Subsidiaries Consolidated Balance Sheets June 30, December 31, 2025 2024 (unaudited) ASSETS Real estate assets and lease intangibles: Land $ 16,833,321 $ 15,983,323 Buildings and improvements 106,094,790 102,862,977 Tenant improvements 16,505,440 16,488,066 Lease intangibles 3,475,531 3,776,654 Real estate assets and lease intangibles held for investment, cost 142,909,082 139,111,020 Accumulated depreciation and amortization ( 35,619,708 ) ( 33,700,262 ) Real estate assets and lease intangibles held for investment, net 107,289,374 105,410,758 Real estate assets held for sale, net 7,286,923 22,185,742 Real estate assets, net 114,576,297 127,596,500 Other assets: Cash, cash equivalents and restricted cash 7,285,089 8,036,496 Deferred leasing costs, net 1,425,887 1,666,135 Goodwill 1,389,000 1,389,000 Investment in Conduit Pharmaceuticals marketable securities (see Notes 2 & 9) 7,728 206,177 Deferred tax asset 298,645 298,645 Other assets, net (see Note 6) 3,417,767 3,376,697 Total other assets 13,824,116 14,973,150 TOTAL ASSETS (1) $ 128,400,413 $ 142,569,650 LIABILITIES AND EQUITY Liabilities: Mortgage notes payable, net $ 84,003,364 $ 80,977,448 Mortgage notes payable related to properties held for sale, net 10,600,440 21,116,646 Mortgage notes payable, total net 94,603,804 102,094,094 Accounts payable and accrued liabilities 3,037,530 3,290,170 Accrued real estate taxes 1,133,318 1,972,477 Dividends payable 190,393 194,784 Lease liability, net 52,552 64,345 Below-market leases, net 5,803 8,625 Total liabilities 99,023,400 107,624,495 Commitments and contingencies (see Note 10) Equity: Series D Preferred Stock, $ 0.01 par value per share; 1,000,000 shares authorized; 974,823 shares issued and outstanding (liquidation preference $ 25.00 per share) as of June 30, 2025 and 997,082 shares issued and outstan

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) June 30, 2025 1. ORGANIZATION AND BASIS OF PRESENTATION Organization. Presidio Property Trust, Inc. ("we", "our", "us" or the "Company") is an internally-managed real estate investment trust ("REIT"), with holdings in office, industrial, retail and model home properties. We were incorporated in the State of California on September 28, 1999, and in August 2010, we reincorporated as a Maryland corporation. In October 2017, we changed our name from "NetREIT, Inc.," to "Presidio Property Trust, Inc." Through Presidio Property Trust, Inc., its subsidiaries, and its partnerships, we own 10 commercial properties in fee interest, two of which we own as a partial interest in various affiliates, in which we serve as general partner, member and/or manager, and a special purpose acquisition company (until deconsolidation in September 2023) as noted below. The Company or one of its affiliates operates the following partnerships during the periods covered by these consolidated financial statements: The Company is the sole general partner and limited partner in two limited partnerships (NetREIT Palm Self-Storage LP and NetREIT Casa Grande LP), both of which, at June 30, 2025 , had ownership interests in an entity that owns income producing real estate. The Company refers to these entities collectively as the "NetREIT Partnerships". The Company is the general and limited partner in six limited partnerships that purchase model homes and lease them back to homebuilders as commercial tenants (Dubose Model Home Investors #202, LP, Dubose Model Home Investors #203, LP, Dubose Model Home Investors #204, LP, Dubose Model Home Investors #205, LP, Dubose Model Home Investors #206, LP, and Dubose Model Home Investors #207, LP). The Company refers to these entities collectively as the "Model Home Partnerships". As of June 30, 2025 , Dubose Model Home Investors #202, LP and Dubose Model Home Investors #206, LP had no remaining as

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