SRG · Seritage Growth Properties

Seritage Growth Properties reported a widened Q1 2026 net loss of $31.5 million attributable to common shareholders, or ($0.56) per diluted share, compared to $23.4 million or ($0.42) per share in the prior year quarter, driven primarily by $15.2 million in impairment charges on a consolidated property and a $5.2 million other-than-temporary impairment loss on an unconsolidated entity. CEO Adam Metz highlighted ongoing efforts to refinance the remaining $50 million corporate debt maturing end of July 2026, explore strategic transactions, and monetize remaining assets under the Plan of Sale approved in 2022. Q1 sale activity included a $5.7 million distribution from an unconsolidated entity property sale, with $11.0 million gross proceeds from a vacant asset sale post-quarter end. Investments were minimal at $0.1 million in consolidated and $2.4 million in unconsolidated properties, offset by $7.4 million in distributions received. Balance sheet shows $58.8 million total cash as of March 31, 2026 (including $14.3 million restricted), rising to $63.2 million by May 14, with term loan net at $48.7 million. The company explicitly raises substantial doubt about its ability to continue as a going concern, citing insufficient cash to fund operating expenses, G&A, and debt service on the term loan facility due July 31, 2026. Portfolio as of quarter-end includes 10 properties (5 consolidated, 5 unconsolidated) totaling ~0.8 million sq ft GLA and 154 acres at proportional share. Ongoing litigation includes a securities class action (Zhengxu He v. Seritage, SDNY) and stayed derivative suits alleging inadequate internal controls and misleading disclosures on impairments and asset values. Series A preferred dividends continue at $0.43750 per share. The strategic review under Plan of Sale persists amid challenging markets with high interest rates pressuring asset pricing and capital access.