Presidio Property Trust, Inc. Q4 FY2021 earnings call

• Jack Heilbron discussed raising capital, acquiring a single tenant triple net property in Baltimore leased to Johns Hopkins Bloomberg School of Public Health, and selling all California properties except the Genesis Plaza headquarters. - Adam Sragovicz highlighted core FFO growth, COVID impact on collections (collected slightly more than billed in 2021 due to past due rent from 2020 being brought current), and leveraging SPAC for potential value. - Gary Katz reported strong leasing in 2021 with 50 leases covering ~217,000 sq ft, property sales in 2021 totaling $33 million, and acquisition of a 30,000 sq ft building leased to Johns Hopkins Bloomberg School of Public Health. - Steve Hightower mentioned selling 44 Model Homes in 2021, acquiring 18 Model Home properties and leasing them back, and builders returning as price growth slows.

Core Performance: Core funds from operations (core FFO) was $2.5 million in 2021 compared to $1.5 million in 2020, with interest expense 45% lower in 2021. Model Home Division: In 2021, sold 44 Model Homes for approximately $21 million, recognizing a gain of about $3 million; acquired 18 Model Home properties and leased them back, with recent acquisition of four more. Revenue contribution details: Core FFO contributed based on the company's main cash flow measure, while Model Home Division's performance was based on sales, gains, and acquisitions.

• Jack Heilbron stated the company will continuously grow through smart acquisitions and raise more capital when the time is right and markets are favorable. - Gary Katz indicated the focus is on yield-driven, stable longer term lease properties with little capital expense exposure and little lease rollover expense, continuing the strategy embarked on in 2021.

• Forward-looking statements are subject to risks and uncertainties where actual results could differ materially. - Potential impact of market conditions on property acquisitions and sales. - Uncertainty regarding the effect of another lockdown on the tenant portfolio and collections.

Q: How much will you make from your shares in the SPAC if it is successful?

A: That depends on the negotiations with the target company. It could be as much as 30% to 40% of our total equity or it could be more. We really won't know the answer to that question until the negotiations are finalized and the shareholders of the SPAC have voted to approve the acquisition of the target company.

Q: What kinds of properties specifically are you looking at for new acquisitions?

A: We're going to continue the strategy that we embarked on last year, where given where we are in the real estate cycle and the economic cycle with the pandemic, bolstering all that, our focus is on yield driven, stable longer term lease properties with little capital expense exposure and little lease rollover expense. We're looking at a diversified property type; it could be industrial, it could be office, it could be retail. The most important thing for us right now is generating cash flow with some stability.

Q: If there were to be another lockdown in 2022, how much of an effect do you think it would have on the Presidio Property portfolio?

A: Well looking at the, historically looking at the last lockdown, I believe we had 13 tenants out of our portfolio of over 200 tenants who requested some sort of assistance on rents, some deferral or such. We got out of that, relatively unscathed. We were able to get concessions from tenants in return for a temporary rent break and we assume if that's the worst case and we have another locked down in the future, I would expect that given the diversification of our tenants businesses that we would have no worse of a situation and we already have.

Q: Do you have plans to raise more capital and what can we expect?

A: We always are looking at the capital markets and will take advantage of opportunities. Our plan is to continuously grow through smart acquisitions, so we will raise more capital when the time is right and the markets are favorable.