Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): August 14, 2024

Presidio Property Trust, Inc.

(Exact name of registrant as specified in its charter)

Maryland

001-34049

33-0841255

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

4995 Murphy Canyon Road, Suite 300

San Diego, California 92123

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (760) 471-8536

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

	☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

	☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

	☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

	☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered

Series A Common Stock, $0.01 par value per share	SQFT	The Nasdaq Stock Market LLC

9.375% Series D Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share	SQFTP	The Nasdaq Stock Market LLC

Series A Common Stock Purchase Warrants to Purchase Shares of Common Stock	SQFTW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02

Results of Operations and Financial Condition

Press Release

On August 14, 2024, Presidio Property Trust, Inc. (the “Company”) issued a press release announcing its financial results for the thee months ended June 30, 2024, and made the press release available on its website, www.PresidioPT.com. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

The Company also made available on its website a financial supplement containing financial data of the Company (“Supplemental Financial Information”) for the quarter ended June 30, 2024, and such Supplemental Financial Information is attached hereto as Exhibit 99.2 and is incorporated by reference herein.

The information in this Item 2.02 of this Current Report on Form 8-K, including the information contained in the exhibits, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 7.01

Regulation FD Disclosure.

The Supplemental Financial Information furnished by the Company and posted to its website as described above under Item 2.02 is hereby incorporated by reference into this Item 7.01.

Item 9.01

Financial Statements and Exhibits.

(d)		Exhibits

99.1		Press Release dated August 14, 2024
99.2		Supplemental Financial Information for the quarter ended June 30, 2024
104		Cover Page Interactive Data File (embedded with the inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: August 14, 2024	PRESIDIO PROPERTY TRUST, INC.

	By:	/s/ Ed Bentzen
	Name:	Ed Bentzen
	Title:	Chief Financial Officer

Exhibit 99.1

Presidio Property Trust, Inc. Announces Earnings for

the Second Quarter Ended June 30, 2024

San Diego, California, August 14, 2024 – Presidio Property Trust, Inc. (Nasdaq: SQFT, SQFTP, SQFTW) (the “Company”), an internally managed, diversified real estate investment trust (“REIT”), today reported earnings for its quarter ended June 30, 2024.

“During the first and second quarters, we entered into 10 leases with new tenants totaling nearly 36,000 sf. Our tenant retention activity has been particularly noteworthy, as we successfully renewed 78% of expiring square footage during this same period. Our overall leasing outlook is positive” said Gary Katz, the Company’s Chief Investment Officer.

Three Months Ended June 30, 2024, Financial Results

Net loss attributable to the Company’s common stockholders for the three months ended June 30, 2024 was approximately $12.4 million, or ($1.00) per basic and diluted share, compared to a net loss of approximately $1.8 million, or ($0.15) per basic and diluted share for the three months ended June 30, 2023. The change in net income attributable to the Company’s common stockholders was a result of:

	●	Total revenues were approximately $4.6 million for the three months ended June 30, 2024, compared to approximately $4.5 million for the same period in 2023. As of June 30, 2024, we had approximately $130.9 million in net real estate assets including 80 model homes, compared to approximately $138.9 million in net real estate assets including 105 model homes at June 30, 2023. The average number of model homes held during the six months ended June 30, 2024 and 2023 was 84 and 101, respectively. The change in revenue is directly related to the average real estate assets held during the period, new commercial real estate leases, and model home transaction fees earned by the Company during the current period.

	●	General & Administrative (“G&A”) expenses for the three months ended June 30, 2024 and 2023 totaled approximately $2.2 million and $1.8 million, respectively. G&A expenses as a percentage of total revenue was 48.0% and 39.9% for the three months ended June 30, 2024 and 2023, respectively. G&A expenses increased by approximately $0.4 million mainly related to the 2024 annual meeting and settlement with Zuma Capital Management LLC (“Zuma Capital”) and certain individuals and entities affiliated or associated with Zuma Capital. This included additional consulting fees, higher proxy solicitation fees and legal fees.

	●	During the three months ended June 30, 2024, we recognized a non-cash impairment charge of approximately $0.1 million related to three model homes. The new impairment charges for the three model homes reflects the estimated sales prices for these specific model homes in July and August 2024 as a result of an abnormally short hold period, less than two years, on model homes purchased in 2022. The builder changed its product style in the neighborhoods where these model homes are located, in Texas, after we had purchased the homes. We do not believe these losses are indicative of our overall model home portfolio. During the three months ended June 30, 2024, we sold 15 model homes for approximately $7.4 million and the Company recognized a net gain of approximately $0.8 million. We expect to record a net gain on model home sales in the third quarter of 2024 as well. The Company did not recognize a non-cash impairment to our real estate assets during the three months ended June 30, 2023.

●

On April 22, 2024, the Company entered into a lockup agreement with Conduit Pharmaceuticals Inc. (“Conduit”) pursuant to which the Company agreed not to transfer or sell 2,700,000 of its 4,015,250 shares of Conduit common stock for a period of one year. In consideration for entering into the lockup agreement Conduit issued the Company warrants (“Private CDT Warrants”) to purchase 540,000 shares of common stock at an exercise price of $3.12 per share. The Private CDT Warrants have a two year term and are exercisable one year after the date of issue. The Private CDT Warrants meet the ASC 321 scope exception for derivative instruments and are accounted for as a derivative under ASC 815. As such, the Private CDT Warrants were recorded at fair value on the date of issuance and subsequently measured at fair value each period, with changes in fair value reported in gain or loss on Conduit Pharmaceuticals marketable securities. As of April 22, 2024, the Private CDT Warrants were valued at $891,000 based on a Level 3 fair value measurement. As of June 30, 2024, the Private CDT Warrants fair value was adjusted to $156,600, and is included in the total Investment in Conduit marketable securities on the June 30, 2024 condensed and condensed consolidated balance sheet. Our investments in Conduit’s common stock (3,990,319 shares of CDT) and public common stock warrants (709,000 warrants of CDTTW) presented on the condensed consolidated balance sheets were measured at fair value using Level 1 market prices, taking into account the adoption of ASU 2022-03 Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, and totaled approximately $4.3 million as of June 30, 2024. The combined value of our Investment in Conduit Pharmaceuticals marketable securities, including the Private CDT Warrants, totaled $4.4 million as of June 30, 2024. In connection with these fair market value adjustments during the three months ended June 30, 2024, we recorded a net loss on our investment in Conduit of approximately $10.0 million.

FFO (non-GAAP) decreased by approximately $0.8 million to approximately $(1.3 million) from $(0.5 million) for the three months ended June 30, 2024 and 2023, respectively. A reconciliation of FFO to net income, the most directly comparable GAAP financial measure, is attached to this press release. However, because FFO excludes depreciation and amortization as well as the changes in the value of the Company’s properties that result from use or market conditions, each of which have real economic effects and could materially impact the Company’s results from operations, the utility of FFO as a measure of the Company’s performance is limited.

We believe Core FFO (non-GAAP) provides a useful metric in comparing operations between reporting periods and in assessing the sustainability of our ongoing operating performance. Core FFO decreased by about $0.2 million, from approximately $(0.2 million) for the three months ended June 30, 2023, to approximately $(0.4 million) for the three months ended June 30, 2024. A reconciliation of Core FFO to net income, the most directly comparable GAAP financial measure, is attached to this press release.

Acquisitions and Dispositions for the three months ended June 30, 2024:

	●	The Company acquired seven model homes for approximately $3.5 million. The purchase price was paid through cash payments of approximately $1.1 million and mortgage notes of approximately $2.4 million.

	●	The Company sold 15 model homes for approximately $7.4 million, net of selling costs and recognized a gain of approximately $0.8 million.

Dividends paid during the three months ended June 30, 2024:

The following is a summary of distributions declared per share of our Series A Common Stock and for our Series D Preferred Stock for the three months ended June 30, 2024 and 2023.

Series A Common Stock

Quarter Ended	2024		2023
	Distributions Declared		Distributions Declared
June 30^th	$	-	$	0.023
Total	$	-	$	0.023

Series D Preferred Stock

Month	2024		2023
	Distributions Declared		Distributions Declared
April	$	0.19531	$	0.19531
May		0.19531		0.19531
June		0.19531		0.19531
Total	$	0.58593	$	0.58593

About Presidio Property Trust

Presidio is an internally managed, diversified REIT with holdings in model home properties which are triple-net leased to homebuilders, office, industrial, and retail properties. Presidio’s model homes are leased to homebuilders located in Arizona, Illinois, Texas, Wisconsin, and Florida. Our office, industrial and retail properties are located primarily in Colorado, with properties also located in Maryland, North Dakota, Texas, and Southern California. While geographical clustering of real estate enables us to reduce our operating costs through economies of scale by servicing several properties with less staff, it makes us susceptible to changing market conditions in these discrete geographic areas, including those that have developed as a result of COVID-19. Presidio owns approximately 6.5% of the outstanding common stock of Conduit Pharmaceuticals Inc., a disease agnostic multi-asset clinical-stage disease-agnostic life science company providing an efficient model for compound development. For more information on Presidio, please visit the Company’s website at https://www.PresidioPT.com.

Definitions

Non-GAAP Financial Measures

Funds from Operations (“FFO”) – The Company evaluates performance based on Funds From Operations, which we refer to as FFO, as management believes that FFO represents the most accurate measure of activity and is the basis for distributions paid to equity holders. The Company defines FFO as net income or loss (computed in accordance with GAAP), excluding gains (or losses) from sales of property, hedge ineffectiveness, acquisition costs of newly acquired properties that are not capitalized and lease acquisition costs that are not capitalized plus depreciation and amortization, including amortization of acquired above and below market lease intangibles and impairment charges on properties or investments in non-consolidated REITs, and after adjustments to exclude equity in income or losses from, and, to include the proportionate share of FFO from, non-consolidated REITs.

However, because FFO excludes depreciation and amortization as well as the changes in the value of the Company’s properties that result from use or market conditions, each of which have real economic effects and could materially impact the Company’s results from operations, the utility of FFO as a measure of the Company’s performance is limited. In addition, other REITs may not calculate FFO in accordance with the NAREIT definition as the Company does, and, accordingly, the Company’s FFO may not be comparable to other REITs’ FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of the Company’s performance.

Core Funds from Operations (“Core FFO”) – We calculate Core FFO by using FFO as defined by NAREIT and adjusting for certain other non-core items. We exclude from our Core FFO calculation acquisition costs, loss on early extinguishment of debt, changes in the fair value of the earn-out, changes in fair value of contingent consideration, non-cash warrant dividends, other non-recuring expenses, and the amortization of stock-based compensation.

We believe Core FFO provides a useful metric in comparing operations between reporting periods and in assessing the sustainability of our ongoing operating performance. Other equity REITs may calculate Core FFO differently or not at all, and, accordingly, the Company’s Core FFO may not be comparable to such other REITs’ Core FFO.

Cautionary Note Regarding Forward-Looking Statements

This press release contains statements that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and other federal securities laws. Forward-looking statements are statements that are not historical, including statements regarding management’s intentions, beliefs, expectations, representations, plans or predictions of the future, and are typically identified by such words as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “may,” “will,” “should” and “could.” Because such statements include risks, uncertainties and contingencies, actual results may differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements also include statements relating to the closing of the business combination with Conduit within a certain timeframe or at all. These forward-looking statements are based upon the Company’s present expectations, but these statements are not guaranteed to occur. Except as required by law, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. Investors should not place undue reliance upon forward-looking statements. For further discussion of the factors that could affect outcomes, please refer to the “Risk Factors” section of the Company’s documents filed with the SEC, copies of which are available on the SEC’s website, www.sec.gov.

Investor Relations Contact:

Presidio Property Trust, Inc.
Lowell Hartkorn, Investor Relations
LHartkorn@presidiopt.com
Telephone: (760) 471-8536 x1244

Presidio Property Trust, Inc. and Subsidiaries

Consolidated Balance Sheets

	June 30,			December 31,
	2024			2023
	(Unaudited)
ASSETS
Real estate assets and lease intangibles:
Land	$	19,409,817		$	21,660,644
Buildings and improvements		126,439,142			133,829,416
Tenant improvements		18,823,656			17,820,948
Lease intangibles		3,776,654			4,110,139
Real estate assets and lease intangibles held for investment, cost		168,449,269			177,421,147
Accumulated depreciation and amortization		(39,951,401	)		(38,725,356	)
Real estate assets and lease intangibles held for investment, net		128,497,868			138,695,791
Real estate assets held for sale, net		2,394,363			5,459,993
Real estate assets, net		130,892,231			144,155,784
Other assets:
Cash, cash equivalents and restricted cash		8,534,881			6,510,428
Deferred leasing costs, net		1,565,169			1,657,055
Goodwill		1,574,000			1,574,000
Investment in Conduit Pharmaceuticals marketable securities (see Notes 2 & 9)		4,413,989			18,318,521
Deferred tax asset		346,762			346,762
Other assets, net (see Note 6)		3,211,251			3,400,088
Total other assets		19,646,052			31,806,854
TOTAL ASSETS	$	150,538,283		$	175,962,638
LIABILITIES AND EQUITY
Liabilities:
Mortgage notes payable, net	$	99,489,045		$	103,685,444
Mortgage notes payable related to properties held for sale, net		1,636,341			4,027,829
Mortgage notes payable, total net		101,125,386			107,713,273
Accounts payable and accrued liabilities		3,501,779			4,770,845
Accrued real estate taxes		1,097,854			1,953,087
Dividends payable		195,310			174,011
Lease liability, net		-			16,086
Below-market leases, net		10,779			13,266
Total liabilities		105,931,108			114,640,568
Equity:
Series D Preferred Stock, $0.01 par value per share; 1,000,000 shares authorized; 1,000,000 shares issued and outstanding (liquidation preference $25.00 per share) as of June 30, 2024 and 890,946 shares issued and outstanding as of December 31, 2023		10,000			8,909
Series A Common Stock, $0.01 par value per share, 100,000,000 shares authorized; 12,418,693 shares and 12,265,061 shares were issued and outstanding at June 30, 2024 and December 31, 2023, respectively		124,187			122,651
Additional paid-in capital		184,402,052			182,331,408
Dividends and accumulated losses		(149,663,851	)		(131,508,785	)
Total stockholders’ equity before noncontrolling interest		34,872,388			50,954,183
Noncontrolling interest		9,734,787			10,367,887
Total equity		44,607,175			61,322,070
TOTAL LIABILITIES AND EQUITY	$	150,538,283		$	175,962,638

Presidio Property Trust, Inc. and Subsidiaries

Consolidated Statements of Operations

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2024			2023			2024			2023
Revenues:
Rental income	$	4,262,942		$	4,329,588		$	8,682,049		$	8,271,641
Fees and other income		323,599			214,284			694,554			393,723
Total revenue		4,586,541			4,543,872			9,376,603			8,665,364
Costs and expenses:
Rental operating costs		1,492,495			1,399,159			3,056,072			2,974,149
General and administrative		2,202,916			1,813,184			4,287,366			3,777,804
Depreciation and amortization		1,351,370			1,368,829			2,702,388			2,702,403
Impairment of real estate assets		101,245			—			196,793			—
Total costs and expenses		5,148,026			4,581,172			10,242,619			9,454,356
Other income (expense):
Interest expense - mortgage notes		(1,525,845	)		(1,336,415	)		(3,041,051	)		(2,204,182	)
Interest and other income, net		5,206			398,085			9,852			1,140,201
Gain on sales of real estate, net		811,903			1,119,952			2,829,998			1,537,289
Net change in Conduit Pharmaceuticals marketable securities (see footnote 9)		(10,027,433	)		—			(13,888,667	)		—
Income tax expense		(81,021	)		(349,074	)		(160,586	)		(497,527	)
Total other (expense) income, net		(10,817,190	)		(167,452	)		(14,250,454	)		(24,219	)
Net loss		(11,378,675	)		(204,752	)		(15,116,470	)		(813,211	)
Less: Income attributable to noncontrolling interests		(469,365	)		(1,094,852	)		(1,973,233	)		(1,481,933	)
Net loss attributable to Presidio Property Trust, Inc. stockholders	$	(11,848,040	)	$	(1,299,604	)	$	(17,089,703	)	$	(2,295,144	)
Less: Preferred Stock Series D dividends		(543,331	)		(532,285	)		(1,065,363	)		(1,067,733	)
Net loss attributable to Presidio Property Trust, Inc. common stockholders	$	(12,391,371	)	$	(1,831,889	)	$	(18,155,066	)	$	(3,362,877	)

Net loss per share attributable to Presidio Property Trust, Inc. common stockholders:
Basic & Diluted	$	(1.00	)	$	(0.15	)	$	(1.47	)	$	(0.28	)

Weighted average number of common shares outstanding - basic & dilutive		12,428,794			11,839,359			12,360,992			11,837,020

FFO AND CORE FFO RECONCILIATION

	For the Three Months Ended June 30,						For the Six Months Ended June,
	2024			2023			2024			2023
Net (loss) income attributable to Presidio Property Trust, Inc. common stockholders	$	(12,391,371	)	$	(1,831,889	)	$	(18,155,066	)	$	(3,362,877	)
Adjustments:
Income attributable to noncontrolling interests		469,365			1,094,852			1,973,233			1,481,933
Depreciation and amortization		1,351,370			1,368,829			2,702,388			2,702,403
Amortization of above and below market leases, net		(1,244	)		(1,244	)		(2,487	)		(2,487	)
Impairment of real estate assets		101,245			—			196,793			—
Net change in Conduit marketable securities		10,027,433			—			13,888,667			—
Loss (gain) on sale of real estate assets, net		(811,903	)		(1,119,952	)		(2,829,998	)		(1,537,289	)
FFO	$	(1,255,105	)	$	(489,404	)	$	(2,226,471	)	$	(718,317	)
Restricted stock compensation		343,107			260,845			885,029			540,501
Cost associated with Zuma Capital Management		469,552			—			565,534			—
Core FFO	$	(442,445	)	$	(228,558	)	$	(775,908	)	$	(177,816	)

Weighted average number of common shares outstanding - basic and diluted		12,428,794			11,839,359			12,360,992			11,837,020

Core FFO / Wgt Avg Share	$	(0.036	)	$	(0.019	)	$	(0.063	)	$	(0.015	)

Quarterly Dividends / Share	$	—		$	0.022		$	—		$	0.023

Exhibit 99.2

SUPPLEMENTAL FINANCIAL INFORMATION

As of June 30, 2024

FORWARD-LOOKING STATEMENTS

This presentation 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 the Quarterly Report on Form 10-Q. 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, dividends, results of operations and other financial and operating information. When used in this presentation, 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.

The forward-looking statements contained in this presentation are based on historical performance and management’s current plans, estimates and expectations in light of information currently available to it and are subject to uncertainty and changes in circumstances. There can be no assurance that future developments affecting us will be those that we have anticipated. Actual results may differ materially from these expectations due to the factors, risks and uncertainties described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as amended to date (“Annual Report”) and the Company’s Quarterly Report on Form 10-Q filed with the SEC on the date hereof (“Quarterly Report”), changes in global, regional or local political, economic, business, competitive, market, regulatory and other factors described in the “Risk Factors” section of the Annual Report and the Quarterly Report, many of which are beyond our control. Should one or more of these risks or uncertainties materialize or should any of our assumptions prove to be incorrect, our actual results may vary in material respects from what we may have expressed or implied by these forward-looking statements. We caution that you should not place undue reliance on any of our forward-looking statements. Any forward-looking statement made by us in this presentation speaks only as of the date on which we make it. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by applicable securities laws.

COMPANY OVERVIEW

●	Presidio Property Trust, Inc. (“Presidio” or the “Company”) was founded in 1999 as NetREIT

●	Presidio is an internally managed real estate company focused on commercial real estate opportunities in often overlooked and regionally dominant markets

●	The Company acquires, owns, and manages office and industrial real estate assets in markets with strong demographic and economic drivers with attractive going-in cap rates

●	Presidio’s commercial portfolio currently includes 12 commercial properties with a book value of approximately $92.6 million

●	In addition to its commercial real estate holdings, Presidio generates fees and rental income from affiliated entities, which manage and/or own a portfolio of model homes ⁽¹⁾

	(1)	The Company holds partial ownership interests in several entities which own model home properties

	(2)	Includes book value of model homes

COMMERCIAL PORTFOLIO

($ in000’s) Property Location	Sq., Ft.		Date Acquired		Year Property Constructed		Purchase Price (1)		Occupancy			Percent Ownership			Mortgage On property
Office/Industrial Properties:
Genesis Plaza, San Diego, CA (2)		57,807		08/10		1989	$	10,000		100.0	%		76.4	%	$	5,876
Dakota Center, Fargo, ND (3)		119,554		05/11		1982		9,575		46.1	%		100.0	%		9,091
Grand Pacific Center, Bismarck, ND (4)		94,943		03/14		1976		5,350		89.7	%		100.0	%		6,341
Arapahoe Center, Colorado Springs, CO		79,023		12/14		2000		11,850		100.0	%		100.0	%		7,336
West Fargo Industrial, West Fargo, ND		150,099		08/15		1998/2005		7,900		100.0	%		100.0	%		5,750
300 N.P., West Fargo, ND		34,517		08/15		1922		3,850		66.4	%		100.0	%		—
One Park Centre, Westminster CO		69,174		08/15		1983		9,150		81.1	%		100.0	%		5,982
Shea Center II, Highlands Ranch, CO		121,306		12/15		2000		25,325		69.0	%		100.0	%		16,808
Baltimore, Baltimore, MD		31,752		12/21		2006		8,892		100.0	%		100.0	%		5,670
Total Office/Industrial Properties		758,175					$	91,892		82.0	%				$	62,854

Retail Properties:
Union Town Center, Colorado Springs, CO		44,042		12/14		2003		11,212		88.1	%		100.0	%		7,791
Research Parkway, Colorado Springs, CO		10,700		08/15		2003		2,850		100.0	%		100.0	%		1,558
Mandolin, Houston, TX (5)		10,500		08/21		2021		4,892		100.0	%		61.3	%		3,541
Total Retail Properties		65,242					$	18,954		90.1	%				$	12,890

		823,417						110,846		82.6	%				$	75,744

(1)	Prior to January 1, 2009, “Purchase Price” includes our acquisition related costs and expenses for the purchase of the property. After January 1, 2009, acquisition related costs and expenses were expensed when incurred.
(2)	Genesis Plaza is owned by two tenants-in-common, each of which own 57% and 43%, respectively, and we beneficially own an aggregate of 76.4%, based on our ownership percentages of each tenant-in-common.
(3)	The loan on the Dakota Center matured on July 6, 2024. Management has been in negotiations with the special servicer of the loan in modifying and/or extending the loan or possibly selling the building. As of August 12, 2024, the Company and the lender have not yet agreed to the final outcome. The lender is expected to visit the property at the end of August.
(4)	Grand Pacific Center, Bismarck, ND, signed a major lease with KLJ Engineering on December 7, 2022 for approximately 33,296 usable square feet, a term of 122 months, and starting annualized rent of $532,736. KLJ Engineering moved into the building during December 2023, and rent commenced on February 28, 2024.
(5)	Mandolin is owned by NetREIT Palm Self-Storage LP, through its wholly owned subsidiary NetREIT Highland LLC, and the Company is the sole general partner and owns 61.3% of NetREIT Palm Self-Storage LP.

MODEL HOMES PORTFOLIO

Geographic Region	No. of Properties		Aggregate Square Feet		Approximate % of Square Feet			Current Base Annual Rent		Approximate of Aggregate % Annual Rent
Southeast		4		9,875		4.1	%	$	170,256		5.1	%
Southwest		76		231,434		95.9	%		3,181,860		94.9	%
Total		80		241,309		100.0	%	$	3,352,116		100.0	%

CONSOLIDATED BALANCE SHEET

Presidio Property Trust, Inc. and Subsidiaries

Consolidated Balance Sheets

	June 30,			December 31,
	2024			2023
		(Unaudited)
ASSETS
Real estate assets and lease intangibles:
Land	$	19,409,817		$	21,660,644
Buildings and improvements		126,439,142			133,829,416
Tenant improvements		18,823,656			17,820,948
Lease intangibles		3,776,654			4,110,139
Real estate assets and lease intangibles held for investment, cost		168,449,269			177,421,147
Accumulated depreciation and amortization		(39,951,401	)		(38,725,356	)
Real estate assets and lease intangibles held for investment, net		128,497,868			138,695,791
Real estate assets held for sale, net		2,394,363			5,459,993
Real estate assets, net		130,892,231			144,155,784
Other assets:
Cash, cash equivalents and restricted cash		8,534,881			6,510,428
Deferred leasing costs, net		1,565,169			1,657,055
Goodwill		1,574,000			1,574,000
Investment in Conduit Pharmaceuticals marketable securities (see Notes 2 & 9)		4,413,989			18,318,521
Deferred tax asset		346,762			346,762
Other assets, net (see Note 6)		3,211,251			3,400,088
Total other assets		19,646,052			31,806,854
TOTAL ASSETS	$	150,538,283		$	175,962,638
LIABILITIES AND EQUITY
Liabilities:
Mortgage notes payable, net	$	99,489,045		$	103,685,444
Mortgage notes payable related to properties held for sale, net		1,636,341			4,027,829
Mortgage notes payable, total net		101,125,386			107,713,273
Accounts payable and accrued liabilities		3,501,779			4,770,845
Accrued real estate taxes		1,097,854			1,953,087
Dividends payable		195,310			174,011
Lease liability, net		-			16,086
Below-market leases, net		10,779			13,266
Total liabilities		105,931,108			114,640,568
Equity:
Series D Preferred Stock, $0.01 par value per share; 1,000,000 shares authorized; 1,000,000 shares issued and outstanding (liquidation preference $25.00 per share) as of June 30, 2024 and 890,946 shares issued and outstanding as of December 31, 2023		10,000			8,909
Series A Common Stock, $0.01 par value per share, 100,000,000 shares authorized; 12,418,693 shares and 12,265,061 shares were issued and outstanding at June 30, 2024 and December 31, 2023, respectively		124,187			122,651
Additional paid-in capital		184,402,052			182,331,408
Dividends and accumulated losses		(149,663,851	)		(131,508,785	)
Total stockholders’ equity before noncontrolling interest		34,872,388			50,954,183
Noncontrolling interest		9,734,787			10,367,887
Total equity		44,607,175			61,322,070
TOTAL LIABILITIES AND EQUITY	$	150,538,283		$	175,962,638

CONSOLIDATED STATEMENT OF OPERATIONS

Presidio Property Trust, Inc. and Subsidiaries

Consolidated Statements of Operations

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2024			2023			2024			2023
Revenues:
Rental income	$	4,262,942		$	4,329,588		$	8,682,049		$	8,271,641
Fees and other income		323,599			214,284			694,554			393,723
Total revenue		4,586,541			4,543,872			9,376,603			8,665,364
Costs and expenses:
Rental operating costs		1,492,495			1,399,159			3,056,072			2,974,149
General and administrative		2,202,916			1,813,184			4,287,366			3,777,804
Depreciation and amortization		1,351,370			1,368,829			2,702,388			2,702,403
Impairment of real estate assets		101,245			—			196,793			—
Total costs and expenses		5,148,026			4,581,172			10,242,619			9,454,356
Other income (expense):
Interest expense - mortgage notes		(1,525,845	)		(1,336,415	)		(3,041,051	)		(2,204,182	)
Interest and other income, net		5,206			398,085			9,852			1,140,201
Gain on sales of real estate, net		811,903			1,119,952			2,829,998			1,537,289
Net change in Conduit Pharmaceuticals marketable securities (see footnote 9)		(10,027,433	)		—			(13,888,667	)		—
Income tax expense		(81,021	)		(349,074	)		(160,586	)		(497,527	)
Total other (expense) income, net		(10,817,190	)		(167,452	)		(14,250,454	)		(24,219	)
Net loss		(11,378,675	)		(204,752	)		(15,116,470	)		(813,211	)
Less: Income attributable to noncontrolling interests		(469,365	)		(1,094,852	)		(1,973,233	)		(1,481,933	)
Net loss attributable to Presidio Property Trust, Inc. stockholders	$	(11,848,040	)	$	(1,299,604	)	$	(17,089,703	)	$	(2,295,144	)
Less: Preferred Stock Series D dividends		(543,331	)		(532,285	)		(1,065,363	)		(1,067,733	)
Net loss attributable to Presidio Property Trust, Inc. common stockholders	$	(12,391,371	)	$	(1,831,889	)	$	(18,155,066	)	$	(3,362,877	)

Net loss per share attributable to Presidio Property Trust, Inc. common stockholders:
Basic & Diluted	$	(1.00	)	$	(0.15	)	$	(1.47	)	$	(0.28	)

Weighted average number of common shares outstanding - basic & dilutive		12,428,794			11,839,359			12,360,992			11,837,020

CONSOLIDATED STATEMENT OF CASH FLOWS

Presidio Property Trust, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

	For the Six Months Ended June 30,
	2024			2023
Cash flows from operating activities:
Net loss	$	(15,116,470	)	$	(813,211	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		2,702,388			2,702,403
Stock compensation		885,029			540,501
Bad debt expense		—			32,729
Gain on sale of real estate assets, net		(2,829,998	)		(1,537,289	)
Net change in Conduit Pharmaceuticals fair value marketable securities		13,888,667			—
Net change in fair value marketable securities		560			(190,327	)
Net change in fair value SPAC Trust Account		—			(939,522	)
Impairment of real estate assets		196,793			—
Amortization of financing costs		214,071			187,303
Amortization of below-market leases		(2,487	)		(2,487	)
Straight-line rent adjustment		(95,603	)		(240,007	)
Changes in operating assets and liabilities:
Other assets		588,867			(399,159	)
Accounts payable and accrued liabilities		(1,440,070	)		239,297
Accounts payable and accrued liabilities for the SPAC		—			(281,723	)
Accrued real estate taxes		(855,233	)		(902,217	)
Net cash used in operating activities		(1,863,486	)		(1,603,709	)
Cash flows from investing activities:
Real estate acquisitions		(5,740,918	)		(12,932,128	)
Additions to buildings and tenant improvements		(1,213,936	)		(1,001,836	)
Investment in marketable securities		—			(1,826,458	)
Proceeds from sale of marketable securities		60,467			1,951,095
Investment of SPAC IPO proceeds into Trust Account		—			(389,942	)
Withdrawals from Trust Account for SPAC taxes		—			792,480
Withdrawals from Trust Account for Redemption of SPAC Shares		—			114,068,280
Deferred leasing costs		3,872			3,872
Proceeds from sales of real estate, net		20,058,923			4,590,187
Net cash provided by investing activities		13,168,408			105,255,550
Cash flows from financing activities:
Proceeds from mortgage notes payable, net of issuance costs		10,663,089			12,848,849
Repayment of mortgage notes payable		(17,110,515	)		(6,417,278	)
Payment of deferred offering costs		(349,589	)		—
Distributions to noncontrolling interests, net		(2,606,333	)		(1,961,310	)
Redemption of SPAC shares		—			(114,068,280	)
Issuance of Series D Preferred Stock, net of offering costs		1,195,855			—
Repurchase of Series A Common Stock, at cost		(7,613	)		—
Repurchase of Series D Preferred Stock, at cost		—			(211,872	)
Dividends paid to Series D Preferred Stockholders		(1,065,363	)		(1,067,733	)
Dividends paid to Series A Common Stockholders		—			(590,151	)
Net cash used in financing activities		(9,280,469	)		(111,467,775	)
Net change in cash, cash equivalents and restricted cash		2,024,453			(7,815,934	)
Cash, cash equivalents and restricted cash - beginning of period		6,510,428			16,516,725
Cash, cash equivalents and restricted cash - end of period	$	8,534,881		$	8,700,791
Supplemental disclosure of cash flow information:
Interest paid-mortgage notes payable	$	2,810,393		$	2,351,642
Non-cash investing activities:
Private warrants from Conduit Pharmaceuticals	$	156,600		$	—
Non-cash financing activities:
Accrued excise tax on January 24, 2023 SPAC redemptions	$	—		$	1,140,683
Dividends payable - Preferred Stock Series D	$	195,310		$	177,145

EBITDAre RECONCILIATION

	For the Three Months Ended June 30,						For the Six Months Ended June,
	2024			2023			2024			2023
Net (loss) income attributable to Presidio Property Trust, Inc. common stockholders	$	(12,391,371	)	$	(1,831,889	)	$	(18,155,066	)	$	(3,362,877	)
Adjustments
Interest Expense		1,525,845			1,336,415			3,041,051			2,204,182
Depreciation and Amortization		1,350,126			1,367,585			2,699,901			2,699,916
Asset Impairment		101,245			—			196,793			—
Net loss (gain) on sale of real estate		(811,903	)		(1,119,952	)		(2,829,998	)		(1,537,289	)
Net change in Conduit marketable securities		10,027,433			—			13,888,667			—
Income Taxes		81,021			349,074			160,586			497,527

EBITDAre	$	(117,604	)	$	101,233		$	(998,067	)	$	501,459

FFO AND CORE FFO RECONCILIATION

	For the Three Months Ended June 30,						For the Six Months Ended June,
	2024			2023			2024			2023
Net (loss) income attributable to Presidio Property Trust, Inc. common stockholders	$	(12,391,371	)	$	(1,831,889	)	$	(18,155,066	)	$	(3,362,877	)
Adjustments:
Income attributable to noncontrolling interests		469,365			1,094,852			1,973,233			1,481,933
Depreciation and amortization		1,351,370			1,368,829			2,702,388			2,702,403
Amortization of above and below market leases, net		(1,244	)		(1,244	)		(2,487	)		(2,487	)
Impairment of real estate assets		101,245			—			196,793			—
Net change in Conduit marketable securities		10,027,433			—			13,888,667			—
Loss (gain) on sale of real estate assets, net		(811,903	)		(1,119,952	)		(2,829,998	)		(1,537,289	)
FFO	$	(1,255,105	)	$	(489,404	)	$	(2,226,471	)	$	(718,317	)
Restricted stock compensation		343,107			260,845			885,029			540,501
Cost associated with Zuma Capital Management		469,552			—			565,534			—
Core FFO	$	(442,445	)	$	(228,558	)	$	(775,908	)	$	(177,816	)

Weighted average number of common shares outstanding - basic and diluted		12,428,794			11,839,359			12,360,992			11,837,020

Core FFO / Wgt Avg Share	$	(0.036	)	$	(0.019	)	$	(0.063	)	$	(0.015	)

Quarterly Dividends / Share	$	—		$	0.022		$	—		$	0.023

SEGMENT DATA

	June 30,		December 31,
Assets by Reportable Segment:	2024		2023
Office/Industrial Properties:
Land, buildings and improvements, net (1)	$	76,768,551	$	77,472,724
Total assets (2)	$	77,076,636	$	78,140,372
Model Home Properties:
Land, buildings and improvements, net (1)	$	38,253,777	$	50,790,147
Total assets (2)	$	39,538,041	$	51,456,292
Retail Properties:
Land, buildings and improvements, net (1)	$	15,863,447	$	15,877,190
Total assets (2)	$	16,541,354	$	16,539,399
Reconciliation to Total Assets:
Total assets for reportable segments	$	133,156,031	$	146,136,063
Other unallocated assets:
Cash, cash equivalents and restricted cash		2,469,278		277,143
Other assets, net		14,912,974		29,549,432
Total Assets	$	150,538,283	$	175,962,638

(1)	Includes lease intangibles and the land purchase option related to property acquisitions.

(2)	Includes land, buildings and improvements, cash, cash equivalents, and restricted cash, current receivables, deferred rent receivables and deferred leasing costs and other related intangible assets, all shown on a net basis.

DEFINITIONS – NON-GAAP MEASUREMENTS

EBITDAre - EBITDAre is defined by NAREIT as earnings before interest, taxes, depreciation, and amortization, gain or loss on disposal of depreciated assets, and impairment write-offs.

Funds from Operations (“FFO”) – The Company evaluates performance based on Funds From Operations, which we refer to as FFO, as management believes that FFO represents the most accurate measure of activity and is the basis for distributions paid to equity holders. The Company defines FFO, a non-GAAP measure, as net income or loss (computed in accordance with GAAP), excluding gains (or losses) from sales of property, hedge ineffectiveness, acquisition costs of newly acquired properties that are not capitalized and lease acquisition costs that are not capitalized plus depreciation and amortization, including amortization of acquired above and below market lease intangibles and impairment charges on properties or investments in non-consolidated REITs, and after adjustments to exclude equity in income or losses from, and, to include the proportionate share of FFO from, non-consolidated REITs.

Core Funds from Operations (“Core FFO”) – We calculate Core FFO by using FFO as defined by NAREIT and adjusting for certain other non-core items. We exclude from our Core FFO calculation acquisition costs, loss on early extinguishment of debt, changes in the fair value of the earn-out, changes in fair value of contingent consideration, non-cash warrant dividends, other non-recuring expenses, and the amortization of stock-based compensation.

Cover	Aug. 14, 2024
Document Type	8-K
Amendment Flag	false
Document Period End Date	Aug. 14, 2024
Entity File Number	001-34049
Entity Registrant Name	Presidio Property Trust, Inc.
Entity Central Index Key	0001080657
Entity Tax Identification Number	33-0841255
Entity Incorporation, State or Country Code	MD
Entity Address, Address Line One	4995 Murphy Canyon Road
Entity Address, Address Line Two	Suite 300
Entity Address, City or Town	San Diego
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92123
City Area Code	(760)
Local Phone Number	471-8536
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Series A Common Stock, $0.01 par value per share
Title of 12(b) Security	Series A Common Stock, $0.01 par value per share
Trading Symbol	SQFT
Security Exchange Name	NASDAQ
9.375% Series D Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share
Title of 12(b) Security	9.375% Series D Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share
Trading Symbol	SQFTP
Security Exchange Name	NASDAQ
Series A Common Stock Purchase Warrants to Purchase Shares of Common Stock
Title of 12(b) Security	Series A Common Stock Purchase Warrants to Purchase Shares of Common Stock
Trading Symbol	SQFTW
Security Exchange Name	NASDAQ