MacKenzie Realty Capital Files Q3 2024 10-Q

TL;DR

MacKenzie Realty Capital's Q3 2024 10-Q is in. Check financials.

AI Summary

MacKenzie Realty Capital, Inc. filed its 10-Q for the period ending September 30, 2024. The filing details financial performance and operational updates for the real estate investment trust. Key financial data and disclosures relevant to investors are presented in this quarterly report.

Why It Matters

This filing provides investors with an update on MacKenzie Realty Capital's financial health and operational performance for the third quarter of 2024, crucial for investment decisions.

Risk Assessment

Risk Level: medium — As a real estate investment trust, MacKenzie Realty Capital is subject to market fluctuations and interest rate risks inherent in the real estate sector.

Key Numbers

• 2024-09-30 — Period End Date (Indicates the end of the reporting quarter for the 10-Q filing.)
• 2024-11-14 — Filing Date (The date MacKenzie Realty Capital, Inc. submitted this 10-Q to the SEC.)

Key Players & Entities

• MacKenzie Realty Capital, Inc. (company) — Filer of the 10-Q
• 2024-09-30 (date) — End of the reporting period
• 2024-11-14 (date) — Filing date
• 0001550913 (company) — Central Index Key for MacKenzie Realty Capital, Inc.

FAQ

Key Financial Figures

• $0.0001 — ange on which registered Common Stock, $0.0001 par value per share MKZR Nasdaq Cap
• $1 — $ 105,940,170 * Amount is less than $1. The accompanying notes to consolidat

Filing Documents

• ef20036685_10q.htm (10-Q) — 2662KB
• ef20036685_ex31-1.htm (EX-31.1) — 12KB
• ef20036685_ex31-2.htm (EX-31.2) — 12KB
• ef20036685_ex32-1.htm (EX-32.1) — 4KB
• ef20036685_ex32-2.htm (EX-32.2) — 4KB
• 0001140361-24-046881.txt ( ) — 13203KB
• mrc-20240930.xsd (EX-101.SCH) — 106KB
• mrc-20240930_cal.xml (EX-101.CAL) — 75KB
• mrc-20240930_def.xml (EX-101.DEF) — 462KB
• mrc-20240930_lab.xml (EX-101.LAB) — 1137KB
• mrc-20240930_pre.xml (EX-101.PRE) — 608KB
• ef20036685_10q_htm.xml (XML) — 2492KB

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 5 Item 2.

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

Management's Discussion and Analysis of Financial Condition and Results of Operations 33 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 48 Item 4.

Controls and Procedures

Controls and Procedures 48 PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 49 Item 1A.

Risk Factors

Risk Factors 49 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 49 Item 3. Defaults Upon Senior Securities 49 Item 4. Mine Safety Disclosures 49 Item 5. Other Information 49 Item 6. Exhibits 50 Table of Contents

FINANCIAL INFORMATION

Part I. FINANCIAL INFORMATION Item 1. Consolidated Financial Statements MacKenzie Realty Capital, Inc. Consolidated Balance Sheets (Unaudited) September 30, 2024 June 30, 2024 Assets Real estate assets Land $ 35,690,148 $ 34,053,565 Building, fixtures and improvements 170,102,235 157,251,012 Intangible lease assets 12,174,178 10,976,549 Less: accumulated depreciation and amortization ( 14,922,760 ) ( 12,684,205 ) Total real estate assets, net 203,043,801 189,596,921 Cash and cash equivalents 10,693,380 11,777,930 Restricted cash 778,923 778,330 Investments, at fair value 1,763,318 2,138,104 Unconsolidated investment (non-security), at fair value 1,784,470 3,906,326 Investments income, rents and other receivables 1,601,868 1,239,666 Deferred offering costs, net 465,500 - Prepaid expenses and other assets 1,181,326 1,254,722 Assets held for sale, net 22,221,715 22,395,769 Total assets $ 243,534,301 $ 233,087,768 Liabilities Mortgage notes payable, net $ 127,281,972 $ 113,687,699 Notes payable 1,780,913 1,635,773 Deferred rent and other liabilities 1,362,654 1,193,209 Finance lease liabilities 2,431,963 1,887,984 Dividend payable 2,378,697 2,313,822 Accounts payable and accrued liabilities 4,255,449 2,311,554 Below-market lease liabilities, net 1,354,541 1,284,832 Due to related entities 114,561 171,260 Capital pending acceptance 96,700 297,000 Liabilities held for sale 442,702 355,543 Total liabilities 141,500,152 125,138,676 Equity Common stock, $ 0.0001 par value, 80,000,000 shares authorized; 13,435,656.79 and 13,302,572.99 shares issued and outstanding as of September 30, 2024 and June 30, 2024, respectively. 1,344 1,330 Preferred stock, $ 0.0001 par value, 20,000,000 shares authorized: Series A Preferred stock, 765,429.60 and 761,370.46 shares issued and outstanding as of September 30, 2024 and June 30

notes to consolidated financial statements are an integral part of these consolidated financial statements

notes to consolidated financial statements are an integral part of these consolidated financial statements. 3 Table of Contents MacKenzie Realty Capital, Inc. Consolidated Statements of Cash Flows (Unaudited) Three Months Ended September 30 , 2024 2023 Cash flows from operating activities: Net loss $ ( 7,408,269 ) $ ( 4,208,702 ) Adjustments to reconcile net loss to net cash from operating activities: Net unrealized loss on equity securities at fair value 2,553 729,793 Net loss from equity method investments at fair value 140,694 1,537,455 Net realized gain on investments ( 151,370 ) - Impairment loss 4,406,249 - Straight-line rent - ( 16,270 ) Depreciation and amortization 2,280,756 1,559,668 Amortization of deferred financing costs and debt mark-to-market 301,588 248,437 Accretion of above (below) market lease, net ( 67,324 ) ( 95,434 ) Changes in assets and liabilities: Investments income, rents and other receivables ( 319,497 ) 327,940 Prepaid expenses and other assets 101,663 12,522 Deferred rent and other liabilities 58,063 ( 19,896 ) Accounts payable and accrued liabilities 1,313,789 441,883 Due to related entities ( 14,536 ) ( 330 ) Net cash from operating activities 644,359 517,066 Cash flows from investing activities: Proceeds from sale of investments 670,727 - Investments in real estate assets ( 5,826,304 ) ( 5,055,288 ) Purchase of investments ( 171,064 ) ( 393,530 ) Return of capital distributions - 21,000 Net cash from investing activities ( 5,326,641 ) ( 5,427,818 ) Cash flows from financing activities: Proceeds from mortgage notes payable 5,889,891 2,945,715 Payments on mortgage notes payable ( 403,206 ) ( 294,927 ) Payments on notes payable ( 4,860 ) ( 4,676 ) Dividend to common stockholders ( 1,662,824 ) ( 1,345,908 ) Dividend to Series A preferred stockholders ( 238,403 ) -

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements September 30, 2024 (Unaudited) NOTE 1 – PRINCIPAL BUSINESS AND ORGANIZATION M acKenzie Realty Capital, Inc. (the "Parent Company" together with its subsidiaries as discussed below, collectively, the "Company," "we," "us," or "our") was incorporated under the general corporation laws of the State of Maryland on January 27, 2012. We have elected to be treated as a real estate investment trust ("REIT") as defined under Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"). We are authorized to issue 100,000,000 shares, of which (i) 80,000,000 are designated as common stock, with a $ 0.0001 par value per share; and (ii) 20,000,000 are designated as preferred stock, with a $ 0.0001 par value per share. We commenced our operations on February 28, 2013, and our fiscal year-end is June 30. We filed our initial registration statement in June 2012 with the Securities and Exchange Commission ("SEC") to register the initial public offering of 5,000,000 shares of our common stock. The initial public offering commenced in January 2014 and concluded in October 2016. We filed a second registration statement with the SEC to register a subsequent public offering of 15,000,000 shares of our common stock. The second offering commenced in December 2016 and concluded on October 28, 2019. We filed a third registration statement with the SEC to register a public offering of 15,000,000 shares of our common stock that was declared effective by the SEC on October 31, 2019. The third offering commenced shortly thereafter and expired on October 31, 2020. On April 29, 2024, o ur common stock became eligible for trading on the OTCQX Best Market under the ticker symbol of MKZR. In addition, on November 6, 2024, Nasdaq approved the listing of the Company's common stock, and trading commenced on November 11, 2024. We are externally managed by MacKenzie Capital Management, LP ("MacKenzie") under a turnkey administration agreem