On June 7, 2024, the Company executed an agreement of purchase and sale with an unaffiliated third party for the sale of our final student property located in Fayetteville Arkansas (“Fayetteville property”). Please see Note 11 – Subsequent Events for additional details regarding the sale.

We concluded that the Fayetteville property qualified as discontinued operations as the property met the criteria of held for sale, and the disposal represents a strategic shift in our business as we will no longer own or operate student housing communities. As a result, certain items were reclassified as part of discontinued operations for comparative purposes. The amounts in the statement of operations that are included in discontinued operations are summarized in the following table:


	Three Months Ended June 30,						Six Months Ended June 30,
	2024			2023			2024			2023
Revenues:
Leasing and related revenues – student	$	1,431,553		$	1,186,239		$	2,870,730		$	2,403,190
Operating expenses:
Property operating expenses – student		617,514			595,807			1,246,590			1,246,210
Property operating expenses – affiliates		126,256			123,593			252,711			247,689
Depreciation		304,451			344,742			660,286			688,981
Total operating expenses		1,048,221			1,064,142			2,159,587			2,182,880
Other expenses:
Interest expense (1)		1,151,689			911,264			2,075,697			1,788,677
Derivative fair value adjustment (2)		147,284			—			147,284			—
Interest expense - debt issuance costs (3)		362,966			44,687			458,054			89,375
Total other expenses		1,661,939			955,951			2,681,035			1,878,052
Net loss from discontinued operations		(1,278,607	)		(833,854	)		(1,969,892	)		(1,657,742	)

(1)

Includes interest expense related to the Fayetteville JPM Mortgage Loan, Fayetteville Mortgage Loan, and the KeyBank Bridge Loan that are required to be repaid according to the terms of the loan, in conjunction with the sale of the Fayetteville property.

(2)

On April 10, 2024, in conjunction with the Fayetteville Mortgage Loan refinance, the Company entered into an interest rate cap agreement with a notional amount of $34.5 million, whereby SOFR was capped at 4.25% through the maturity of the Fayetteville Mortgage Loan, that capped the all in rate at 6.5%. We elected not to designate the interest cap as a hedge for GAAP purposes, and changes in the fair value are recorded in the statement of discontinued operations.

(3)

Includes interest expense - debt issuance costs related to the Fayetteville JPM Mortgage Loan, Fayetteville Mortgage, and the KeyBank Bridge Loan that are required to be repaid according to the terms of the loan, in conjunction with the sale of the Fayetteville property.

The amounts in the statement of cash flows that are included in discontinued operations are summarized in the following table:


	Six Months Ended June 30,
	2024			2023
Adjustments to reconcile net loss to net cash provided by discontinued operating activities:
Depreciation	$	660,286		$	688,981
Amortization of debt issuance costs		170,005			89,375
Derivative fair value adjustment		147,284			—
Increase (decrease) in cash, cash equivalents, and restricted cash from changes in assets and liabilities:
Purchase of interest rate cap		(366,000	)		—
Other assets		(170,117	)		118,325
Accounts payable and accrued liabilities		245,781			368,644
Due to affiliates		252,711			247,689
Net cash provided by discontinued operating activities		939,950			1,513,014
Cash flows from discontinued investing activities:
Additions to real estate		(193,341	)		(323,899	)
Net cash used in discontinued investing activities		(193,341	)		(323,899	)
Cash flows from discontinued financing activities:
Principal payments of KeyBank Bridge Loans		(300,000	)		(300,000	)
Proceeds from Fayetteville JPM refinance		5,000,000			—
Debt issuance costs		(362,439	)		—
Net cash used in discontinued financing activities		4,337,561			(300,000	)
Net change in cash, cash equivalents, and restricted cash discontinued operations	$	5,084,170		$	889,115