0000014846-26-000007
SEC filingBRT Apartments Corp. reported a net loss of $11.9 million for FY 2025, compared to a net loss of $11.8 million in FY 2024. Total revenues increased 1.5% to $97.0 million, driven by a 0.5% increase in rental revenue to $95.3 million and a 105.7% increase in loan interest and other income to $1.8 million. However, total expenses rose 1.5% to $109.5 million, primarily due to higher interest expense ($23.5 million, up 4.0%) and real estate operating expenses ($44.1 million, up 1.2%). The company generated positive operating cash flow of $14.1 million but used $21.5 million in investing activities for property improvements and joint venture contributions. Key challenges include inflationary pressures, oversupply in key markets, and $154.6 million of mortgage debt maturing through 2027 at higher interest rates.
BRT Apartments Corp. reported a net loss attributable to common stockholders of $11.9 million for FY 2025, slightly worse than the $11.8 million loss in FY 2024. Total revenues increased by $1.4 million (1.5%) to $97.0 million, primarily driven by rental and other revenue from real estate properties increasing $0.5 million (0.5%) to $95.3 million and loan interest and other income increasing $0.9 million (105.7%) to $1.8 million. However, total expenses also increased by $1.6 million (1.5%) to $109.5 million, with interest expense rising $0.9 million (4.0%) to $23.5 million and real estate operating expenses increasing $0.5 million (1.2%) to $44.1 million. The company reported equity in loss from unconsolidated joint ventures of $174,000, compared to earnings of $1.6 million in 2024, representing a $1.8 million decrease.
Rental and other revenue from real estate properties increased by $492,000 (0.5%) to $95.3 million. The increase was driven by a 0.74% net increase in average rental rates year-over-year ($510,000), an increase in average occupancy from 93.8% to 93.9% ($261,000), $149,000 in other rental income from tenant reimbursements, and a $114,000 increase at the Yonkers commercial property. These increases were partially offset by a $532,000 decrease in revenue from straight-line adjustments of rent concessions. Loan interest and other income increased by $906,000 (105.7%) to $1.8 million, primarily due to the inclusion of income from Preferred Equity Investments originated in Q4 2024 for the full year 2025.
The company's loss from continuing operations was $11.6 million, with a net loss after taxes of $11.8 million. Real estate operating expenses increased to $44.1 million (1.2% increase), driven by higher payroll ($564,000), utilities ($476,000), real estate taxes ($255,000), and other expenses ($354,000), partially offset by a $927,000 decrease in insurance expense. Interest expense increased to $23.5 million (4.0% increase) due to new mortgage financing and increased credit facility draws. General and administrative expenses decreased slightly to $15.5 million (0.4% decrease) due to reduced employee count and AFFO Award expenses.
Operating activities generated $14.1 million in cash flow, primarily from $26.4 million in depreciation and amortization adjustments to the $11.8 million net loss. Investing activities used $21.5 million, with $7.5 million for property improvements, $19.1 million in contributions to joint ventures, and $4.2 million in distributions received. Financing activities provided $2.4 million, including $87.7 million in mortgage proceeds offset by $58.0 million in mortgage payoffs, $18.9 million in dividends paid, and $5.0 million in share repurchases. The balance sheet shows total assets of $709.8 million, with real estate properties net of $596.8 million. Total liabilities are $532.6 million, including $471.1 million in mortgages payable, resulting in total equity of $177.2 million.
Management faces challenges from uncertain economic conditions, including inflation, potential recession, and oversupply in key markets like Atlanta, Dallas, and Nashville. The company anticipates mortgage interest expense will increase as it refinances $154.6 million of mortgage debt maturing through 2027, with current rates (4.97% on recent financings) higher than the weighted average rate on maturing debt (4.43%). Insurance premiums are expected to decrease by approximately $500,000 in 2026. The company may incur impairment charges in 2026 and continues to face risks from geographic concentration in the Southeast and Texas, joint venture relationships, and climate change impacts on coastal properties.