Lightstone REIT Swings to $10M Loss Amid Marketable Securities Hit

TL;DR

**Lightstone REIT's $10M loss is a clear signal to sell, as declining asset values and investment losses point to a challenging future.**

AI Summary

Lightstone Value Plus REIT I, Inc. reported a significant net loss of $10.014 million for the six months ended June 30, 2025, a sharp decline from a net income of $2.292 million in the prior year period. This was primarily driven by an unrealized loss on marketable equity securities of $2.293 million in 2025, compared to a gain of $2.063 million in 2024, and the absence of a $10.852 million gain on disposition of real estate recorded in 2024. Total revenues remained relatively flat at $29.647 million for the six months ended June 30, 2025, compared to $29.683 million in the same period of 2024. Hotel revenues decreased slightly from $24.360 million to $23.911 million, while rental revenues increased from $5.323 million to $5.736 million. The company also recognized a gain on debt extinguishment of $1.929 million in 2025. Net investment property decreased from $252.823 million as of December 31, 2024, to $249.762 million as of June 30, 2025, and total assets declined from $447.477 million to $416.376 million over the same period. Mortgages payable, net, also decreased from $221.252 million to $203.385 million.

Why It Matters

This significant swing to a net loss of $10.014 million for Lightstone Value Plus REIT I, Inc. is a red flag for investors, indicating potential challenges in its investment strategy and asset management. The absence of major real estate dispositions and unrealized losses on marketable securities suggest a tougher market environment or less favorable investment choices compared to the previous year. For employees, this could signal a period of cost-cutting or reduced growth opportunities. Customers of their properties might not see direct impacts immediately, but sustained losses could affect property maintenance or future development. In the broader market, this performance highlights the volatility in the REIT sector, especially for unlisted entities, and could influence investor sentiment towards similar non-traded REITs, particularly those with exposure to hotel and multifamily properties in competitive markets like New York City and Columbus, Ohio.

Risk Assessment

Risk Level: high — The company reported a net loss of $10.014 million for the six months ended June 30, 2025, a substantial deterioration from a net income of $2.292 million in the prior year. This is exacerbated by a $2.293 million unrealized loss on marketable equity securities and a decrease in total assets from $447.477 million to $416.376 million, indicating significant financial strain and asset value erosion.

Analyst Insight

Investors should consider divesting from Lightstone Value Plus REIT I, Inc. given the substantial net loss of $10.014 million and the decline in total assets. The lack of a public listing further limits liquidity and transparency, making it difficult to exit positions or accurately value the investment.

Financial Highlights

debt To Equity

1.69

revenue

$29.647M

operating Margin

-13.73%

total Assets

$416.376M

total Debt

$203.385M

net Income

$-10.014M

eps

$-0.48

gross Margin

N/A

cash Position

$32.352M

revenue Growth

-0.02%

Revenue Breakdown

Key Numbers

• $10.014M — Net loss attributable to Company's common shares (For the six months ended June 30, 2025, a significant decline from $2.243 million net income in the prior year.)
• $2.293M — Unrealized loss on marketable equity securities (For the six months ended June 30, 2025, compared to a $2.063 million gain in the prior year, contributing to the net loss.)
• $29.647M — Total revenues (For the six months ended June 30, 2025, relatively flat compared to $29.683 million in the prior year.)
• $249.762M — Net investment property (As of June 30, 2025, a decrease from $252.823 million as of December 31, 2024.)
• $416.376M — Total Assets (As of June 30, 2025, a decrease from $447.477 million as of December 31, 2024.)
• $203.385M — Mortgages payable, net (As of June 30, 2025, a decrease from $221.252 million as of December 31, 2024.)
• $1.929M — Gain on debt extinguishment (For the six months ended June 30, 2025, a positive financial event.)
• 21.096M — Common shares outstanding (As of June 30, 2025, a slight decrease from 21.257 million as of December 31, 2024.)
• $0.48 — Net loss per common share, basic and diluted (For the six months ended June 30, 2025, compared to $0.10 net income per share in the prior year.)
• $155.079M — Total Stockholders' Equity (As of June 30, 2025, a decrease from $168.319 million as of December 31, 2024.)

Key Players & Entities

• Lightstone Value Plus REIT I, Inc. (company) — Registrant and primary entity
• Lightstone Value Plus REIT, L.P. (company) — Operating Partnership
• David Lichtenstein (person) — Majority owner of Advisor and Sponsor, Chairman and CEO
• Lightstone Value Plus REIT, LLC (company) — Advisor to the REIT
• The Lightstone Group, LLC (company) — Sponsor of the REIT
• Lightstone SLP, LLC (company) — Affiliate of the Advisor, owner of SLP Units
• Marriott International, Inc. (company) — Brand for Moxy hotel
• 50-01 2nd St. Associates LLC (company) — Joint venture for Gantry Park Landing
• Columbus Portfolio Member LLC (company) — Joint venture for Columbus Portfolio
• LVP Holdco JV LLC (company) — Joint venture for Hotel JV Portfolio

FAQ

Risk Factors

• Marketable Securities Volatility [medium — financial]: The company experienced an unrealized loss of $2.293 million on marketable equity securities for the six months ended June 30, 2025, a significant swing from a gain of $2.063 million in the prior year. This volatility directly impacted net income, contributing to the substantial net loss.
• Dependence on Real Estate Dispositions [medium — financial]: The absence of a $10.852 million gain on disposition of real estate, which was recorded in the prior year period, significantly impacted the current period's net income. This highlights a potential reliance on one-time gains for profitability.
• Increased Interest Expense [low — financial]: Interest expense increased from $12.832 million to $13.129 million for the six months ended June 30, 2025, despite a decrease in total liabilities. This could indicate higher borrowing costs or a shift in debt structure.
• Declining Asset Base [medium — financial]: Total assets decreased from $447.477 million as of December 31, 2024, to $416.376 million as of June 30, 2025. Net investment property also declined from $252.823 million to $249.762 million, indicating a potential contraction in the company's real estate portfolio.
• Leverage Reduction [low — financial]: Mortgages payable, net, decreased from $221.252 million to $203.385 million. While this reduces leverage, it may also reflect asset sales or deleveraging strategies that impact overall asset size.
• Hotel Revenue Decline [low — operational]: Hotel revenues saw a slight decrease from $24.360 million to $23.911 million for the six months ended June 30, 2025. This could be due to market conditions, competition, or operational challenges within the hotel segment.

Industry Context

The REIT sector, particularly those focused on hospitality and rental properties, is sensitive to economic cycles and consumer spending. The slight decline in hotel revenues suggests potential headwinds in the travel and leisure sector, while the increase in rental revenues may indicate resilience in residential or commercial leasing markets. Competition and interest rate environments are key factors influencing profitability and property valuations.

Regulatory Implications

REITs are subject to specific tax regulations and reporting requirements. Changes in accounting standards or tax laws could impact financial reporting and profitability. Compliance with real estate and financial regulations is crucial for maintaining operations and investor confidence.

What Investors Should Do

1. Monitor the performance of the hotel segment closely.
2. Analyze the drivers of the unrealized loss on marketable securities.
3. Evaluate the sustainability of rental revenue growth.
4. Assess the impact of asset sales and deleveraging on future income.

Key Dates

• 2025-06-30: Six months ended — Reported a net loss of $10.014 million, a significant decline from the prior year's net income of $2.292 million.
• 2024-12-31: As of year-end — Total assets were $447.477 million and net investment property was $252.823 million.
• 2025-06-30: As of period-end — Total assets decreased to $416.376 million and net investment property to $249.762 million.

Glossary

Net investment property

The value of real estate owned by the company, net of accumulated depreciation. (Represents the core asset base of the REIT, and its decrease indicates a potential reduction in the company's real estate holdings.)

Unrealized loss on marketable equity securities

A decrease in the market value of equity securities that the company holds but has not yet sold. (This directly impacts the company's net income and reflects market volatility affecting its investment portfolio.)

Gain on debt extinguishment

A profit recognized when a company repays its debt for less than its carrying amount. (This is a one-time gain that positively impacted the current period's net income but is not a recurring revenue source.)

Noncontrolling interests

The portion of equity in a subsidiary that is not attributable to the parent company. (Fluctuations in noncontrolling interests can affect the net income and equity attributable to the parent company's shareholders.)

Accumulated other comprehensive income

The cumulative amount of unrealized gains and losses that have not been reported in net income. (Includes items like holding gains on available-for-sale securities, which can impact overall equity.)

Year-Over-Year Comparison

For the six months ended June 30, 2025, Lightstone Value Plus REIT I, Inc. reported a substantial net loss of $10.014 million, a stark contrast to the $2.292 million net income in the prior year. This downturn was primarily driven by a $2.293 million unrealized loss on marketable equity securities, compared to a $2.063 million gain previously, and the absence of a $10.852 million gain on real estate disposition. Total revenues remained flat at $29.647 million, with hotel revenues slightly declining while rental revenues increased. Total assets and net investment property have decreased, reflecting a contraction in the company's balance sheet.

Filing Documents

• lvvr110q063025.htm (10-Q) — 895KB
• lvvr1ex31-1.htm (EX-31.1) — 10KB
• lvvr1ex31-2.htm (EX-31.2) — 10KB
• lvvr1ex32-1.htm (EX-32.1) — 4KB
• lvvr1ex32-2.htm (EX-32.2) — 4KB
• 0001185185-25-000990.txt ( ) — 5468KB
• lvp-20250630.xsd (EX-101.SCH) — 56KB
• lvp-20250630_cal.xml (EX-101.CAL) — 45KB
• lvp-20250630_def.xml (EX-101.DEF) — 241KB
• lvp-20250630_lab.xml (EX-101.LAB) — 439KB
• lvp-20250630_pre.xml (EX-101.PRE) — 256KB
• lvvr110q063025_htm.xml (XML) — 629KB

Financial Statements (unaudited)

Financial Statements (unaudited) 3 Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 3 Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024 4 Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2025 and 2024 5 Consolidated Statements of Stockholders' Equity for the Three and Six Months Ended June 30, 2025 and 2024 6 Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 8

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 9 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 27 Item 4.

Controls and Procedures

Controls and Procedures 46 PART II OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 47 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 47 Item 3. Defaults Upon Senior Securities 47 Item 4. Mine Safety Disclosures 47 Item 5. Other Information 47 Item 6. Exhibits 47 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION:

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS: LIGHTSTONE VALUE PLUS REIT I, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except per share data and where indicated in millions) As of June 30, 2025 As of December 31, 2024 (unaudited) Assets Investment property: Land and improvements $ 91,178 $ 91,177 Building and improvements 173,498 173,283 Furniture and fixtures 18,110 17,861 Construction in progress 146 133 Gross investment property 282,932 282,454 Less: accumulated depreciation ( 33,170 ) ( 29,631 ) Net investment property 249,762 252,823 Development project - 19,000 Investment in related party joint venture 415 430 Investment in unconsolidated affiliated entity 12,986 14,778 Cash and cash equivalents 27,941 27,819 Marketable securities 36,306 40,180 Restricted cash 4,411 7,300 Other assets 5,083 4,555 Assets held for sale 79,472 80,592 Total Assets $ 416,376 $ 447,477 Liabilities and Stockholders' Equity Mortgages payable, net $ 203,385 $ 221,252 Accounts payable, accrued expenses and other liabilities 14,199 15,718 Liabilities associated with assets held for sale 43,713 42,188 Total Liabilities 261,297 279,158 Commitments and contingencies Stockholders' equity: Company's Stockholders' Equity: Preferred shares, $ 0.01 par value, 10.0 million shares authorized, none issued and outstanding - - Common stock, $ 0.01 par value; 60.0 million shares authorized, 21.1 million and 21.3 million shares issued and outstanding, respectively 210 212 Additional paid-in-capital 155,357 157,178 Accumulated other comprehensive income 19 - Accumulated (deficit)/surplus ( 634 ) 9,449 Total Company's stockholders' equity 154,952 166,839 - - Noncontrolling interests 127 1,480 Total Stockholders' Equity 155,079 168,319 Total Liabilities and Stockholders' Equity $ 416,376 $ 447,477 The accompanying notes are an integral part of the

FINANCIAL INFORMATION, CONTINUED

PART I. FINANCIAL INFORMATION, CONTINUED:

FINANCIAL STATEMENTS, CONTINUED

ITEM 1. FINANCIAL STATEMENTS, CONTINUED: LIGHTSTONE VALUE PLUS REIT I, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except per share data) (Unaudited) For the Three Months Ended June 30, For the Six Months Ended June 30, 2025 2024 2025 2024 Revenues: Rental revenues $ 2,904 $ 2,707 $ 5,736 $ 5,323 Hotel revenues 14,375 14,341 23,911 24,360 Total revenues 17,279 17,048 29,647 29,683 Expenses: Property operating expenses 685 766 1,581 1,460 Hotel operating expenses 8,937 9,501 16,795 17,796 Real estate taxes 822 689 1,648 1,378 General and administrative costs 972 969 2,044 1,968 Depreciation and amortization 1,777 1,768 3,545 3,505 Total expenses 13,193 13,693 25,613 26,107 Interest and dividend income 686 576 1,355 1,098 Interest expense ( 6,547 ) ( 6,352 ) ( 13,129 ) ( 12,832 ) Gain on debt extingishemnt 1,929 - 1,929 - Gain on disposition of real estate - 10,852 - 10,852 Unrealized (loss)/gain on marketable equity securities ( 1,055 ) ( 1,030 ) ( 2,293 ) 2,063 Loss from investment in unconsolidated affiliated real estate entity ( 920 ) ( 902 ) ( 1,810 ) ( 1,773 ) Other expense, net ( 77 ) ( 21 ) ( 100 ) ( 692 ) Net (loss)/income ( 1,898 ) 6,478 ( 10,014 ) 2,292 Less: net income attributable to noncontrolling interests ( 639 ) ( 104 ) ( 69 ) ( 49 ) Net (loss)/income attributable to Company's common shares $ ( 2,537 ) $ 6,374 $ ( 10,083 ) $ 2,243 Net (loss)/income per Company's common share, basic and diluted $ ( 0.12 ) $ 0.30 $ ( 0.48 ) $ 0.10 Weighted average number of common shares outstanding, basic and diluted 21,116 21,433 21,157 21,477 The accompanying notes are an integral part of these consolidated financial statements. 4 Table of Contents

FINANCIAL INFORMATION, CONTINUED

PART I. FINANCIAL INFORMATION, CONTINUED:

FINANCIAL STATEMENTS, CONTINUED

ITEM 1. FINANCIAL STATEMENTS, CONTINUED: LIGHTSTONE VALUE PLUS REIT I, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in thousands) (Unaudited) For the Three Months Ended June 30, For the Six Months Ended June 30, 2025 2024 2025 2024 Net (loss)/income $ ( 1,898 ) $ 6,478 $ ( 10,014 ) $ 2,292 Other comprehensive income: Holding gain on available for sale debt securities 24 - 19 - Other comprehensive income: 24 - 19 - Comprehensive (loss)/income ( 1,874 ) 6,478 ( 9,995 ) 2,292 Less: Comprehensive income attributable to noncontrolling interests ( 639 ) ( 104 ) ( 69 ) ( 49 ) Comprehensive (loss)/income attributable to the Company's common shares $ ( 2,513 ) $ 6,374 $ ( 10,064 ) $ 2,243 The accompanying notes are an integral part of these consolidated financial statements. 5 Table of Contents

FINANCIAL INFORMATION, CONTINUED

PART I. FINANCIAL INFORMATION, CONTINUED:

FINANCIAL STATEMENTS, CONTINUED

ITEM 1. FINANCIAL STATEMENTS, CONTINUED: LIGHTSTONE VALUE PLUS REIT I, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Amounts in thousands) (Unaudited) Common Stock Additional Paid-In Accumulated Noncontrolling Total Stockholders' Shares Amount Capital Surplus Interests Equity BALANCE, March 31, 2024 21,499 $ 214 $ 160,177 $ 21,323 $ 12,231 $ 193,945 Net income - - - 6,374 104 6,478 Distributions paid to noncontrolling interests - - - - ( 18 ) ( 18 ) Redemption and cancellation of common shares ( 81 ) ( 1 ) ( 949 ) - - ( 950 ) BALANCE, June 30, 2024 21,418 $ 213 $ 159,228 $ 27,697 $ 12,317 $ 199,455 Common Stock Additional Paid-In Accumulated Noncontrolling Total Stockholders' Shares Amount Capital Surplus Interests Equity BALANCE, December 31, 2023 21,581 $ 215 $ 161,174 $ 25,454 $ 11,558 $ 198,401 Net income - - - 2,243 49 2,292 Distributions paid to noncontrolling interests - - - - ( 35 ) ( 35 ) Contributions received from noncontrolling interests - - - - 745 745 Redemption and cancellation of common shares ( 163 ) ( 2 ) ( 1,946 ) - - ( 1,948 ) BALANCE, June 30, 2024 21,418 $ 213 $ 159,228 $ 27,697 $ 12,317 $ 199,455 6 Table of Contents Common Stock Additional Paid-In Accumulated Other Comprehensive Accumulated Noncontrolling Total Stockholders' Shares Amount Capital Income Deficit Interests Equity BALANCE, March 31, 2025 21,176 $ 211 $ 156,230 $ ( 5 ) $ 1,903 $ ( 558 ) $ 157,781 Net loss - - - - ( 2,537 ) 639 ( 1,898 ) Other comprehensive income - - - 24 - - 24 Distributions paid to noncontrolling interests - - - - - ( 192 ) ( 192 ) Contributions received from noncontrolling interests - - - - - 238 238 Redemption and cancellation of common shares ( 80 ) ( 1 ) ( 873 ) - - - ( 874 ) BALANCE, June 30, 2025 21,096 $ 210 $ 155,357 $ 19 $ ( 634

FINANCIAL INFORMATION, CONTINUED

PART I. FINANCIAL INFORMATION, CONTINUED:

FINANCIAL STATEMENTS, CONTINUED

ITEM 1. FINANCIAL STATEMENTS, CONTINUED: LIGHTSTONE VALUE PLUS REIT I, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) (Unaudited) For the Six Months Ended June 30, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES: Net (loss)/income $ ( 10,014 ) $ 2,292 Adjustments to reconcile net (loss)/income to net cash used in operating activities: Depreciation and amortization 3,545 3,505 Gain on disposition of real estate - ( 10,852 ) Gain on debt extinguishment ( 1,929 ) - Loss from investment in unconsolidated affiliated real estate entity 1,810 1,773 Unrealized loss/(gain) on marketable equity securities 2,293 ( 2,063 ) Amortization of deferred financing costs 1,308 1,329 Other non-cash adjustments 117 32 Changes in assets and liabilities: Increase in other assets ( 609 ) ( 542 ) Increase/(decrease) in accounts payable, accrued expenses and other liabilities 173 ( 180 ) Net cash used in operating activities ( 3,306 ) ( 4,706 ) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of investment property ( 479 ) ( 1,128 ) Purchase of marketable securities ( 1,008 ) ( 187 ) Proceeds from sale of marketable securities 2,500 187 Proceeds from disposition of real estate - 14,780 Extension fees received in connection with disposition of real estate 1,300 - Investment in related party joint venture ( 7 ) ( 9 ) Distributions from related party joint venture 22 35 Investment in unconsolidated affiliated real estate entity ( 18 ) ( 10 ) Net cash provided by investing activities 2,310 13,668 CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from mortgage financing 67,478 2,630 Mortgage principal payments ( 65,439 ) ( 748 ) Proceeds from notes payable - 3,000 Payment of financing fees and expenses ( 1,718 ) ( 120 ) Redemption and cancellation of common shares ( 1,823 ) ( 1,948 ) Contributions received from noncontrolling interests 353 745

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) (Dollar amounts in thousands, except per share/unit data and where indicated in millions) 1. Business and Structure Lightstone Value Plus REIT I, Inc., is a Maryland corporation ("Lightstone REIT I"), formed on June 8, 2004, which has elected to be taxed and qualify as a real estate investment trust ("REIT") for United States ("U.S.") federal income tax purposes. Lightstone REIT I was formed primarily for the purpose of engaging in the business of investing in and owning commercial and multifamily residential real estate properties and making other real estate-related investments located throughout the U.S. Lightstone REIT I is structured as an umbrella partnership REIT, or UPREIT, and substantially all of its current and future business is and will be conducted through Lightstone Value Plus REIT, L.P. (the "Operating Partnership"), a Delaware limited partnership formed on July 12, 2004. As of June 30, 2025, Lightstone REIT I held a 98 % general partnership interest in the Operating Partnership's common units ("Common Units"). Lightstone REIT I, together with the Operating Partnership and its subsidiaries are collectively referred to as the "Company" and the use of "we," "our," "us" or similar pronouns refers to Lightstone REIT I, its Operating Partnership or the Company as required by the context in which such pronoun is used. Through its Operating Partnership, the Company owns, operates and develops commercial and multifamily residential properties and makes other real estate-related investments, principally in the U.S. The Company's real estate investments are held by it alone or jointly with other parties. The Company also originates or acquires mortgage loans secured by real estate. Although most of its investments are of these types, the Company may invest in whatever types of real estate or real estate-related investments that it believes is in its best interests. Since its inception, the Company

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) (Dollar amounts in thousands, except per share/unit data and where indicated in millions) The Company's advisor is Lightstone Value Plus REIT, LLC (the "Advisor"), which is majority owned by David Lichtenstein. On July 6, 2004, the Advisor contributed $ 2 to the Operating Partnership in exchange for 200 Common Units. The Company's Advisor also owns 20,000 shares of the Company's common stock ("Common Shares") which were issued on July 6, 2004 for $ 200 , or $ 10.00 per share. Mr. Lichtenstein also is the majority owner of the equity interests of The Lightstone Group, LLC (the "Sponsor"), which served as the Company's sponsor during its initial public offering (the "Offering"), which terminated on October 10, 2008. The Company's Advisor, pursuant to the terms of an advisory agreement, together with its board of directors (the "Board of Directors"), is primarily responsible for making investment decisions on the Company's behalf and managing its day-to-day operations. Through his ownership and control of the Sponsor, Mr. Lichtenstein is the indirect general partner interests ("SLP Units") in the Operating Partnership which were purchased, at a cost of $ 100,000 per unit, in connection with the Company's Offering. Mr. Lichtenstein also acts as the Company's Chairman and Chief Executive Officer. As a result, he exerts influence over but does not control Lightstone REIT I or the Operating Partnership. The Company has no employees. The Company is dependent on the Advisor and certain affiliates of its Sponsor for performing a full range of services that are essential to it, including asset management, property management (excluding its hospitality property, which is managed by unrelated third-party property managers) and acquisition, disposition and financing activities, and other ge

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) (Dollar amounts in thousands, except per share/unit data and where indicated in millions) Other Noncontrolling Interests in Consolidated Subsidiaries Other noncontrolling interests in consolidated subsidiaries include the joint venture ownership interests held by either the Sponsor or its affiliates in (i) Pro-DFJV Holdings LLC ("PRO") through its liquidation on December 26, 2024, (ii) the 2 nd Street Joint Venture and (iii) the LSC 1543 7th LLC (the "Santa Monica Joint Venture"). PRO's holdings principally consisted of common units ("Simon OP Units") of Simon Property Group, L.P., the operating partnership of Simon Property Group, Inc. ("Simon Inc."), a public REIT that is an owner and operator of shopping malls and outlet centers. The 2 nd Street Joint Venture owns Gantry Park Landing and the Santa Monica Joint Venture previously owned certain land parcels located in Santa Monica, California, on which a multifamily residential project (the "Santa Monica Project") had been proposed. The Santa Monica Joint Venture disposed of its ownership interest in the Santa Monic Project on June 18, 2025 (see Notes 3 and 6 for additional information). Current Environment The Company's operating results and financial condition are substantially impacted by the overall health of local, U.S. national and global economies and may be influenced by market and other challenges. Additionally, the Company's business and financial performance may be adversely affected by current and future economic and other conditions; including, but not limited to, availability or terms of financings, financial markets volatility and banking failures, political upheaval or uncertainty, natural and man-made disasters, terrorism and acts of war, unfavorable changes in laws, ordinances and regulations, outbreaks of contagious diseases, cybercrime, technological advances and challenges, such as the use and impact of artificial intelligence and

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