0001104659-26-050395
SEC filingNet loss narrowed sharply to $9.5M from $21.4M a year ago, but revenue slipped 3.3% and operating cash flow remained negative as office leasing headwinds persist.
Net cash used in operating activities was $5.2 million, compared to $5.5 million in the prior year, reflecting the narrower net loss partially offset by changes in working capital. Capital expenditures totaled $2.7 million, down from $4.5 million in the prior year, as the company focused on preserving liquidity. Free cash flow was negative $7.8 million. Management believes the company has adequate funds to cover unusual expenses and capital improvements, in addition to normal operating expenses. The acquisition of new properties, capital improvements, debt service, and distribution requirements place demands on liquidity. The company anticipates generating funds from continuing real estate operations, use of its Delayed Draw Term Loans, and proceeds from property dispositions.
In May 2025, the Board initiated a strategic alternatives review, which was expanded in April 2026 to include BofA Securities and JLL as co-advisors. The company is evaluating corporate transactions, asset sales, and refinancing. In March 2026, the Board suspended quarterly cash dividends to redeploy capital into leasing efforts and preserve liquidity. The credit agreement restricts dividends to the greater of $0.01 per share or the amount needed to maintain REIT status. Management believes the combination of an active strategic review, disciplined execution, and continued leasing progress will maximize shareholder value, though the office market remains challenged by economic conditions and the lingering effects of the pandemic.