FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2025

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

Cash and cash equivalents, restricted cash, accounts payable, accrued expenses, and other liabilities are carried at amounts that reasonably approximate their fair value due to their short-term nature. For variable rate line of credit debt that re-prices frequently, fair values are based on carrying values.

In determining the fair value of other financial instruments, Centerspace applies FASB ASC 820, “Fair Value Measurement and Disclosures.” Fair value hierarchy under ASC 820 distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (Levels 1 and 2) and the reporting entity’s own assumptions about market participant data (Level 3). Fair value estimates may differ from the amounts that may ultimately be realized upon sale or disposition of the assets and liabilities.

Fair Value Measurements on a Recurring Basis

		(in thousands)
	Balance Sheet Location	Total		Level 1	Level 2	Level 3
March 31, 2025
Assets
Real estate related notes receivable	Other assets	$	25,406	—	—	$	25,406
December 31, 2024
Assets
Real estate related notes receivable	Other assets	$	25,092	—	—	$	25,092

Centerspace utilizes an income approach with Level 3 inputs based on expected future cash flows to value the notes receivable. The unobservable inputs include market transactions for similar instruments, management estimates of comparable interest rates (range of 5.00% to 9.00%), and instrument specific credit risk (range of 0.5% to 1.0%). Changes in the fair value of these receivables from period to period are reported in interest and other income on the Condensed Consolidated Statements of Operations.

	(in thousands)
	Fair Value Measurement		Other Gains		Interest Income		Total Changes in Fair Value Included in Current-Period Earnings
Three months ended March 31, 2025
Real estate related notes receivable	$	25,406	$	9	$	531	$	540
Three months ended March 31, 2024
Real estate related notes receivable	$	14,103	$	5	$	208	$	213

As of March 31, 2025 and December 31, 2024, Centerspace had investments totaling $2.9 million and $2.7 million, respectively, in real estate technology venture funds consisting of privately held entities that develop technology related to the real estate industry. These investments appear within other assets on the Condensed Consolidated Balance Sheets. The investments are measured at net asset value (“NAV”) as a practical expedient under ASC 820. As of March 31, 2025, the Company had unfunded commitments of $850,000.

Fair Value Measurements on a Nonrecurring Basis

There were no non-financial assets or liabilities measured at fair value on a nonrecurring basis at March 31, 2025 and December 31, 2024.

Financial Assets and Liabilities Not Measured at Fair Value

The fair value of unsecured senior notes and mortgages payable is estimated based on the discounted cash flows of the loans using market research and management estimates of comparable interest rates, excluding any prepayment penalties (Level 3).

The estimated fair values of the Company’s financial instruments as of March 31, 2025 and December 31, 2024, respectively, are as follows:

		(in thousands)
		March 31, 2025				December 31, 2024
	Balance Sheet Location	Amount		Fair Value		Amount		Fair Value
FINANCIAL ASSETS
Cash and cash equivalents	Cash and cash equivalents	$	11,916	$	11,916	$	12,030	$	12,030
Restricted cash	Restricted cash	$	6,144	$	6,144	$	1,099	$	1,099
FINANCIAL LIABILITIES
Revolving lines of credit	Revolving lines of credit	$	48,734	$	48,734	$	47,359	$	47,359
Unsecured senior notes(1)	Notes payable	$	300,000	$	260,468	$	300,000	$	253,808
Mortgages payable - Fannie Mae credit facility	Mortgages payable	$	198,850	$	172,735	$	198,850	$	166,679
Mortgages payable - other(1)	Mortgages payable	$	418,508	$	393,049	$	420,414	$	383,213

(1)Excludes deferred financing costs, debt premiums, and discounts