Loans Held For Investment, Net (Tables)

12 Months Ended

Dec. 31, 2024

Loans Held For Investment, Net [Abstract]

Schedule of Loans Held for Investment by Interest Rate Type

The following tables present summarized information regarding our loans held for investment by interest rate type as of December 31, 2024 and 2023:

	As of December 31, 2024
		Total Principal		Original Issue Discount			Carrying Value		Percentage of loans held for investment
Fixed-rate loans		$	149,771,871	$	(545,081	)	$	149,226,790		37.0	%
Floating-rate loans			254,949,683		(1,699,427	)		253,250,256		63.0	%
Total		$	404,721,554	$	(2,244,508	)	$	402,477,046		100.0	%

Schedule of Loans Held for Investment

The following tables summarize the Company’s aggregate portfolio of loans held for investment, net of current expected credit loss reserve as of December 31, 2024 and 2023:

	As of December 31, 2024
	Outstanding Principal		Original Issue Discount			Carrying Value			Weighted Average Remaining Life (Years) (1)
Senior Term Loans	$	404,721,554	$	(2,244,508	)	$	402,477,046			2.2
Current expected credit loss reserve		-		-			(4,346,869	)
Total loans held at carrying value, net	$	404,721,554	$	(2,244,508	)	$	398,130,177

	As of December 31, 2023
	Outstanding Principal		Original Issue Discount			Carrying Value			Weighted Average Remaining Life (Years) (1)
Senior Term Loans	$	355,745,305	$	(2,104,695	)	$	353,640,610			2.1
Current expected credit loss reserve		-		-			(4,972,647	)
Total loans held at carrying value, net	$	355,745,305	$	(2,104,695	)	$	348,667,963

(1)Weighted average remaining life is calculated based on the carrying value of the loans as of December 31, 2024 and 2023, respectively.

Schedule of Activity Related to the CECL Reserve for Outstanding Balances

The following tables present changes in loans held at carrying value as of and for the years ended December 31, 2024 and 2023:

	Principal			Original Issue Discount			Current Expected Credit Loss Reserve			Carrying Value
Balance at December 31, 2023	$	355,745,305		$	(2,104,695	)	$	(4,972,647	)	$	348,667,963
New fundings		161,289,523			(1,836,952	)		-			159,452,571
Principal repayment of loans		(102,461,111	)		-			-			(102,461,111	)
Accretion of original issue discount		-			1,697,139			-			1,697,139
Transfer of loan held for investment to loan held for sale		(19,000,000	)					213,913			(18,786,087	)
PIK Interest		9,147,837			-			-			9,147,837
Decrease in provision for current expected credit losses		-			-			411,865			411,865
Balance at December 31, 2024	$	404,721,554		$	(2,244,508	)	$	(4,346,869	)	$	398,130,177

	Principal			Original Issue Discount			Current Expected Credit Loss Reserve			Carrying Value
Balance at December 31, 2022	$	343,029,334		$	(3,755,796	)	$	(3,940,939	)	$	335,332,599
New fundings		93,533,516			(1,332,340	)		-			92,201,176
Principal repayment of loans		(76,876,048	)		-			-			(76,876,048	)
Accretion of original issue discount		-			2,983,441			-			2,983,441
Transfer of loan held for investment to loan held for sale		(13,399,712	)		-			-			(13,399,712	)
PIK Interest		9,458,215			-			-			9,458,215
Increase in provision for current expected credit losses		-			-			(1,031,708	)		(1,031,708	)
Balance at December 31, 2023	$	355,745,305		$	(2,104,695	)	$	(4,972,647	)	$	348,667,963

Schedule of Loans Held at Carrying Value Based on Information

A more detailed listing of the Company’s loans held at carrying value based on information available as of December 31, 2024, is as follows:

Loan (1)	Location(s)	Initial Funding Date (1)	Maturity Date (2)	Principal Balance		Original Issue Discount			Carrying Value		Percentage of Our Loan Portfolio			Future Fundings		Interest Rate (3)	Periodic Payment (4)	YTM IRR (5)
1	Various	10/27/2022	10/30/2026	$	19,324,557	$	(314,110	)	$	19,010,447		4.7	%		-	P+6.5% Cash (8)	P&I	17.1%
2	Michigan	12/31/2021	12/31/2025		27,110,506		-			27,110,506		6.7	%		-	P+3% Cash (13)(20)	I/O	17.3%
3	Various	11/18/2021	1/29/2027		21,248,176		(523,689	)		20,724,487		5.1	%		-	P+10.375% Cash, 2.75% PIK (11)(14)(15)	I/O	22.2%
4	Arizona	4/19/2021	6/17/2026		6,626,809		-			6,626,809		1.6	%		-	11.91% Cash	I/O	17.0%
5	Massachusetts	4/19/2021	4/30/2025		2,564,180		-			2,564,180		0.6	%		-	P+12.25% Cash (6)	P&I	22.6%
6	Michigan	8/20/2021	1/30/2026		4,958,123		-			4,958,123		1.2	%		-	P+6.5% Cash (13)	I/O	17.2%
7	Illinois, Arizona	8/24/2021	6/30/2025		24,293,793		(54,413	)		24,239,380		6.0	%		-	P+6% Cash, 2% PIK (9)	P&I	19.3%
8	West Virginia	9/1/2021	12/31/2025		8,491,943		-			8,491,943		2.1	%		-	10% Cash	I/O	15.0%
9	Pennsylvania	9/3/2021	6/30/2024		16,402,488		-			16,402,488		4.1	%		-	P+20.75% Cash(6)(16)	P&I	17.5%
12	Various	11/8/2021	10/31/2027		11,159,358		(35,634	)		11,123,724		2.8	%		-	P+7% Cash, 2% PIK (10)	I/O	19.3%
16	Florida	12/30/2021	8/29/2025		6,557,500		(25,236	)		6,532,264		1.6	%		-	16.75% Cash	I/O	31.2%
18	Ohio	2/3/2022	12/31/2025		45,024,611		(433,918	)		44,590,693		11.1	%		-	P+1.75% Cash, 5% PIK (9)(17)	I/O	16.1%
19	Florida	3/11/2022	12/31/2025		18,892,211		(23,850	)		18,868,361		4.7	%		-	11% Cash, 5% PIK	P&I	16.5%
20	Missouri	5/9/2022	11/28/2025		22,243,402		(65,969	)		22,177,433		5.5	%		-	11% Cash, 2% PIK	P&I	14.7%
21	Illinois	7/1/2022	7/29/2026		6,583,891		(34,755	)		6,549,136		1.6	%		-	P+7% Cash, 2% PIK (9)	P&I	23.3%
23	Arizona	3/27/2023	3/31/2026		1,620,000		(20,682	)		1,599,318		0.4	%		-	P+7.5% Cash (12)	P&I	18.7%
24	Oregon	9/27/2022	9/27/2026		580,000		-			580,000		0.1	%		-	P+10.5% Cash (7)	P&I	21.7%
25	New York	8/1/2023	6/29/2036		25,093,595		-			25,093,595		6.2	%		-	15% Cash	P&I	16.6%
27	Nebraska	8/15/2023	6/30/2027		17,400,000		-			17,400,000		4.3	%		-	P+6.5% Cash (18)	I/O	15.7%
28	Ohio	9/13/2023	3/13/2025		2,466,705		-			2,466,705		0.6	%		-	15% Cash	I/O	17.4%
29	Illinois	10/11/2023	10/9/2026		1,943,217		-			1,943,217		0.5	%		-	11.4% Cash, 1.5% PIK	P&I	14.7%
30	Missouri, Arizona	12/19/2023	12/31/2026		19,000,000		(139,306	)		18,860,694		4.7	%		-	P+7.75% Cash (13)	P&I	18.7%
31	California, Illinois	5/3/2023	5/3/2026		6,680,000		-			6,680,000		1.7	%		-	P+8.75% Cash (10)	I/O	18.3%
32	Nevada	4/15/2024	8/15/2027		6,000,000		(27,982	)		5,972,018		1.5	%		-	P+6.5% Cash (12)	I/O	16.1%
33	Minnesota	5/20/2024	5/28/2027		1,116,000		(4,776	)		1,111,224		0.3	%		-	12% Cash (14)	P&I	12.9%
34	Arizona	6/17/2024	5/29/2026		10,000,000		-			10,000,000		2.5	%		-	11.91% Cash	I/O	12.8%
35	California	8/23/2024	8/23/2027		24,256,045		-			24,256,045		6.0	%		-	12% Cash, 3% PIK	I/O	16.3%
36	Illinois	10/28/2024	1/1/2027		25,000,000		(114,937	)		24,885,063		6.2	%		2,000,000	P+6.25% Cash (10)	I/O	15.2%
37	Various	11/26/2024	11/24/2028		20,019,444		(390,404	)		19,629,040		4.9	%		10,000,000	12% Cash, 1% PIK (19)	I/O	15.2%
38	Minnesota	12/13/2024	12/13/2025		2,065,000		(34,847	)		2,030,153		0.5	%		2,935,000	10% Cash (19)	I/O	14.7%
			Total	$	404,721,554	$	(2,244,508	)	$	402,477,046		100	%	$	14,935,000		Wtd Average	17.2%

(1)Loan numbering in the table above is maintained from origination for purposes of comparability and may not be sequential due to maturities, payoffs, or refinancings.

(2)Certain loans are subject to contractual extension options and may be subject to performance based on other conditions as stipulated in the loan agreement. Actual maturities may differ from contractual maturities stated herein and certain borrowers may have the right to prepay with or without a contractual prepayment penalty. The Company may also extend contractual maturities and amend other terms of the loans in connection with loan modifications.

(3)"P" = prime rate and depicts floating rate loans that pay interest at the prime rate plus a specific percentage; "PIK" = paid-in-kind interest.

(4)P&I = principal and interest. I/O = interest only. P&I loans may include interest only periods for a portion of the loan term. The frequency of loan payments may be monthly or quarterly as required by the respective credit agreement governing such loan.

(5)Estimated YTM, calculated on a weighted average principal basis, includes a variety of fees and features that affect the total yield, which may include, but is not limited to, OID, exit fees, prepayment fees, unused fees and contingent features. OID is recognized as a discount to the funded loan principal and is accreted to income over the term of the loan. The estimated YTM calculations require management to make estimates and assumptions, including, but not limited to, the timing and amounts of loan draws on delayed draw loans, the timing and collectability of exit fees, the probability and timing of prepayments and the probability of contingent features occurring. For example, certain credit agreements contain provisions pursuant to which certain PIK interest rates and fees earned by us under such credit agreements will decrease upon the satisfaction of certain specified criteria which we believe may improve the risk profile of the applicable borrower. To be conservative, we have not assumed any prepayment penalties or early payoffs in our estimated YTM calculation. Estimated YTM is based on current management estimates and assumptions, which may change. Actual results could differ from those estimates and assumptions.

(6)This Loan is subject to a prime rate floor of 3.25%

(7)This Loan is subject to a prime rate floor of 5.50%

(8)This Loan is subject to a prime rate floor of 6.25%

(9)This Loan is subject to a prime rate floor of 7.00%

(10)This Loan is subject to a prime rate floor of 7.50%

(11)This Loan is subject to a prime rate floor of 7.75%

(12)This Loan is subject to a prime rate floor of 8.00%

(13)This Loan is subject to a prime rate floor of 8.50%

(14)The borrower of Loan #33 is an affiliate of the borrower of Loan #3, a related party. The aggregate principal balance of these loans is included on the consolidated balance sheet as loans held for investment - related party. See Note 9 for further details.

(15)The aggregate principal balance outstanding of Loan #3 is comprised of two tranches. The first tranche has a principal balance of approximately $16.9 million, bears a floating interest rate of prime plus 10.375% cash and 2.75% PIK and has a maturity date of January 29, 2027. The second tranche has a principal balance of approximately $4.4 million, bears an interest rate of 15.00% cash and 2.00% PIK, and a maturity date of May 29, 2026. The statistics presented reflect the weighted average of the rate terms under both tranches for the total aggregate loan principal, however only the maturity date for the first tranche has been presented in the table above.

(16)As of May 1, 2023, Loan #9 was placed on non-accrual status and remains on non-accrual as of December 31, 2024. Loan #9 is included on the consolidated balance sheet as a loan held for investment – related party (Note 9). This loan had an original maturity date of June 30, 2024 and is included in amounts past due in the tables below.

(17)An affiliate under common control holds a controlling equity investment in this portfolio company (Note 9).

(18)This loan has floating grid pricing based on the Prime Rate plus a spread of 5.00% to 8.75% based on monthly annualized EBITDA performance. As of December 31, 2024, applied interest rate is Prime Rate + 6.50%.

(19)Loan #37 and Loan #38 bear unused fees on the unfunded commitment of 0.75% and 1.50% per annum, respectively.

(20)On September 27, 2024, $13.0 million of principal of Loan #2 was reclassified to held for sale, and was subsequently sold to a third party at a price of $13.0 million on September 30, 2024. The remaining balance presented is held for investment as of December 31, 2024.

Schedule of Presents Aging Analyses of Past Due Loans by Amortized Cost

The following tables present aging analyses of past due loans by amortized cost, excluding the CECL reserve, as of December 31, 2024 and 2023. As of both December 31, 2024 and 2023, there was one loan with principal greater than 90 days past due.

	As of December 31, 2024
	Current Loans (1)		31-60 Days Past Due		61-90 Days Past Due		90+ Days Past Due (2)		Total Past Due		Total Loans		Non- Accrual(2)
Senior Term Loans	$	386,074,558	$	-	$	-	$	16,402,488	$	16,402,488	$	402,477,046	$	16,402,488
Total	$	386,074,558	$	-	$	-	$	16,402,488	$	16,402,488	$	402,477,046	$	16,402,488

	As of December 31, 2023
	Current Loans (1)		31-60 Days Past Due		61-90 Days Past Due		90+ Days Past Due		Total Past Due		Total Loans		Non- Accrual(2)
Senior Term Loans	$	337,238,122	$	-	$	-	$	16,402,488	$	16,402,488	$	353,640,610	$	20,666,374
Total	$	337,238,122	$	-	$	-	$	16,402,488	$	16,402,488	$	353,640,610	$	20,666,374

(1)Loans 1-30 days past due are included in the current loans.

(2)On May 1, 2023, Loan #9 was placed on non-accrual status. On June 20, 2023, the Administrative Agent to Loan #9 issued an acceleration notice requesting immediate payment of all amounts outstanding and therefore is 90 days past due as of December 31, 2023. On December 1, 2023, Loan #6 was placed on non-accrual status. In March 2024, the Company entered into an amendment to Loan #6, which extended the maturity date to April 15, 2024. In the second quarter of 2024, the Company entered into an additional amendment to Loan #6, which extended the maturity date from April 15, 2024 to January 30, 2026 and restored Loan #6 to accrual status.

Schedule of Risk Rating

Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows:

Rating	Definition
1	Very low risk
2	Low risk
3	Moderate/average risk
4	High risk/potential for loss: a loan that has a risk of realizing a principal loss
5	Impaired/loss likely: a loan that has a high risk of realizing principal loss, has incurred principal loss or an impairment has been recorded

Schedule of Carrying Value of Loans Held for Investment

As of December 31, 2024 and 2023, the carrying value, excluding the current expected credit loss reserve (the “CECL Reserve”), of the Company’s loans within each risk rating category by year of origination is as follows:

	As of December 31, 2024(1)
Risk Rating	2024		2023		2022		2021		Total
1	$	1,111,224	$	580,000	$	41,045,793	$	-	$	42,737,017
2		63,823,279		64,896,824		90,874,764		24,239,380		243,834,247
3		34,653,247		2,466,705		27,110,506		13,687,904		77,918,362
4		10,000,000		-		-		27,987,420		37,987,420
5		-		-		-		-		-
Total	$	109,587,750	$	67,943,529	$	159,031,063	$	65,914,704	$	402,477,046

	As of December 31, 2023(1)
Risk Rating	2024		2023		2022		2021		Total
1	$	-	$	820,000	$	37,644,911	$	-	$	38,464,911
2		-		51,320,161		107,007,422		46,792,941		205,120,524
3		-		2,466,705		5,296,308		58,829,717		66,592,730
4		-		-		-		43,462,445		43,462,445
5		-		-		-		-		-
Total	$	-	$	54,606,866	$	149,948,641	$	149,085,103	$	353,640,610

(1)Amounts are presented by loan origination year with subsequent advances shown in the original year of origination.

Our loans are generally secured in whole or in part by real estate collateral which includes, but is not limited to; mortgages on industrial and retail real estate properties, leasehold mortgages, and other interests in real property. These forms of real estate collateral enable us to maintain our qualification as a REIT. Our loans are also generally secured by a combination of other forms of collateral, including licenses, accounts receivable, equipment, intellectual property, equity pledges of our borrowers, and personal or corporate guarantees which provide value incremental to our real estate collateral. While real estate collateral coverage is a significant indicator of the credit quality of our portfolio, the value of these other forms of collateral also contribute to the determination of the CECL reserve. Accordingly, changes in real estate collateral coverage alone may not present a direct correlation to the change in our CECL reserve.

Our portfolio weighted average real estate collateral coverage for loans held for investment was 1.5x as of December 31, 2023 compared to 1.1x as of December 31, 2024. The decrease in real estate collateral coverage is primarily driven by portfolio composition given new originations during the year ended December 31, 2024 had weighted average real estate coverage of less than 1.5x. The below tables presents our r

Schedule of Real Estate Collateral Coverage

The below tables presents our real estate collateral coverage ratio, for loans held for investment, net as of December 31, 2024 and 2023:

As of December 31, 2024(1)
	< 1.0x		1.0x – 1.25x		1.25x – 1.5x		1.50x – 1.75x		1.75x – 2.0x		> 2.0x		Total
Fixed-rate	$	45,029,665	$	48,900,184	$	43,750,558	$	9,603,167	$	-	$	1,943,216	$	149,226,790
Floating-rate		155,364,941		16,402,488		6,549,135		-		24,885,063		50,048,629		253,250,256
	$	200,394,606	$	65,302,672	$	50,299,693	$	9,603,167	$	24,885,063	$	51,991,845	$	402,477,046

As of December 31, 2023(1)
	< 1.0x		1.0x – 1.25x		1.25x – 1.5x		1.50x – 1.75x		1.75x – 2.0x		> 2.0x		Total
Fixed-rate	$	2,466,706	$	-	$	49,041,867	$	17,613,043	$	-	$	-	$	69,121,616
Floating-rate		104,322,083		35,491,887		38,729,046		15,396,370		5,296,308		85,283,300		284,518,994
	$	106,788,789	$	35,491,887	$	87,770,913	$	33,009,413	$	5,296,308	$	85,283,300	$	353,640,610

(1)Real estate collateral coverage is calculated based upon the most recent third-party appraised values. The Company generally obtains new appraisals of all material real estate collateral at least once annually.

Summary of Geography Concentration of Loans Held for Investment

Geographic concentration of our loans held for investment is also a significant credit quality indicator. As of December 31, 2024 and 2023, our borrowers have operations in the jurisdictions in the table below:

As of December 31, 2024						As of December 31, 2023
Jurisdiction	Outstanding Principal (1)		Percentage of Our Loan Portfolio			Jurisdiction	Outstanding Principal (1)		Percentage of Our Loan Portfolio
Ohio	$	60,065,707		15	%	Ohio	$	27,902,362		8	%
Illinois		55,958,079		14	%	Illinois		25,599,133		7	%
Florida		42,712,285		11	%	Florida		48,815,066		14	%
Missouri		38,208,259		9	%	Missouri		25,191,575		7	%
Pennsylvania		35,727,045		9	%	Pennsylvania		21,674,160		6	%
Michigan		32,068,629		8	%	Michigan		56,466,635		16	%
Arizona		28,023,340		7	%	Arizona		24,466,609		7	%
California		26,057,479		6	%	California		—		-	%
New York		25,093,595		6	%	New York		22,611,938		6	%
Maryland		21,835,901		5	%	Maryland		53,907,352		15	%
Nebraska		17,400,000		4	%	Nebraska		13,061,667		4	%
West Virginia		8,491,943		2	%	West Virginia		11,706,059		3	%
Nevada		6,000,000		1	%	Nevada		5,764,439		2	%
Texas		2,756,870		1	%	Texas		—		-	%
Massachusetts		2,626,423		1	%	Massachusetts		12,308,310		3	%
Minnesota		1,116,000		0	%	Minnesota		—		-	%
Oregon		580,000		0	%	Oregon		820,000		0	%
Connecticut		—		-	%	Connecticut		5,450,000		2	%
Total	$	404,721,554		100	%	Total	$	355,745,305		100	%

(1) The principal balance of the loans not secured by real estate collateral are included in the jurisdiction representing the principal place of business.

Schedule of Activity Related to the CECL Reserve for Outstanding Balances

Activity related to the CECL Reserve for outstanding balances and unfunded commitments on the Company’s loans held at carrying value and loans receivable at carrying value as of and for the years ended December 31, 2024 and 2023 is presented in the table below.

	Outstanding			Unfunded		Total
Balance at December 31, 2023	$	4,972,647		$	3,092	$	4,975,739
(Benefit) provision for current expected credit losses		(625,778	)		42,480		(583,298	)
Balance at December 31, 2024	$	4,346,869		$	45,572	$	4,392,441

	Outstanding		Unfunded			Total
Balance at December 31, 2022	$	3,940,939	$	94,415		$	4,035,354
Provision for current expected credit losses		1,031,708		(91,323	)		940,385
Balance at December 31, 2023	$	4,972,647	$	3,092		$	4,975,739