UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

STRATEGIC REALTY TRUST, INC.

(Exact name of registrant as specified in its charter)

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

There isThe aggregate market value of common stock held by non-affiliates of the registrant as of June 30, 2022 cannot be calculated because no established trading market exists for the registrant’s common stock. On May 26, 2021, the registrant’s board of directors approved an estimated value per share of the registrant’s common stock of $3.43 per share based on estimated value of the registrant’s real estate assets and the estimated value of the registrant’s tangible other assets less the estimated value of the registrant’s liabilities divided by the number of shares and operating partnership units outstanding, as of February 28, 2021. For a full description of the methodologies used to value the registrant’s assets and liabilities in connection with the calculation of the estimated value per share as of February 28, 2021, see Part II, Item 5, “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities - Market Information” of this Annual Report on Form 10-K.

As of June 30, 2021,2023, the last business day of the registrant’s most recently completed second fiscal quarter, 10,467,16610,728,475 shares of its common stock were held by non-affiliates.

As of March 21, 2022,25, 2024, there were 10,752,966 shares of the registrant’s common stock issued and outstanding.

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES

TABLE OF CONTENTS

Special Note Regarding Forward-Looking Statements

Certain statements included in this Annual Report on Form 10-K that are not historical facts (including any statements concerning investment objectives,our ability to implement the Plan of Liquidation (as defined below), other plans and objectives of management for future operations, or economic performance, or assumptions or forecasts related thereto) are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements are only predictions. We caution that forward-looking statements are not guarantees. Actual events or our investments and results of operations could differ materially from those expressed or implied in any forward-looking statements. Forward-looking statements are typically identified by the use of terms such as “may,” “should,” “expect,” “could,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “predict,” “potential” or the negative of such terms and other comparable terminology.

The forward-looking statements included herein are based upon our current expectations, plans, estimates, assumptions and beliefs, which involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements. The following are some of the risks and uncertainties, although not all of the risks and uncertainties, that could cause our actual results to differ materially from those presented in our forward-looking statements:

business conditions in this geographic areaSan Francisco or Los Angeles, or in the urban retail market, could affect our operating results and our ability to pay distributions to our stockholders.

All forward-looking statements should be read in light of the risks identified in Part I, Item 1A of this Annual Report.above. Any of the assumptions underlying the forward-looking statements included herein could be inaccurate, and undue reliance should not be placed upon on any forward-looking statements included herein. All forward-looking statements are made as of the date of this Annual Report, and the risk that actual results will differ materially from the expectations expressed herein will increase with the passage of time. Moreover, you should interpret many of the risks identified in this Annual Report, as well as the risks described in Part I, Item 1A, as being heightened as a result of the ongoingcontinued disruptions in the financial markets impacting the commercial real estate industry, including with respect to the current economic slowdown, rising interest rates and numerous adverse impacts of the COVID-19 pandemic.significant inflation. Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements made after the date of this Annual Report, whether as a result of new information, future

PART I

ITEM 1. BUSINESS

Overview

Strategic Realty Trust, Inc., is a Maryland corporation formed on September 18, 2008 to invest in and manage a portfolio of income-producing retail properties, located in the United States, real estate-owning entities and real estate-related assets, including the investment in or origination of mortgage, mezzanine, bridge and other loans related to commercial real estate.States. We have elected to be taxed as a real estate investment trust, or REIT, for federal income tax purposes, commencing with the taxable year ended December 31, 2009. As used herein, the terms “we” “our” “us” and “Company” refer to Strategic Realty Trust, Inc., and, as required by context, Strategic Realty Operating Partnership, L.P., a Delaware limited partnership, which we refer to as our “operating partnership” or “OP”, and to their respective subsidiaries. References to “shares” and “our common stock” refer to the shares of our common stock. We own substantially all of our assets and conduct our operations through our operating partnership, of which we are the sole general partner. We also own a majority of the outstanding limited partner interests in the operating partnership.

From August 7, 2009 through February 7, 2013 we conducted an initial public offering pursuant to which we offered a maximumraised $104.7 million in gross primary offering proceeds through the sale of 100,000,00010,688,940 shares of our common stock toand an additional $3.6 million in gross offering proceeds through the public in our primary offering at $10.00 per share and up to 10,526,316sale of 391,182 shares of our common stock to our stockholders at $9.50 per share pursuant toin our distribution reinvestment plan (“DRIP”) (collectively, the “Offering”).

Our board of directors has adopted a share redemption program that maycould enable our stockholders to sell their shares of common stock to us in limited circumstances (the “SRP”), subject to the significant restrictions and limitations of the program. From January 2013 until April 2015, the SRP was suspended with respect to all redemption requests. In April 2015 the SRP was reinstated solely with respect to shares submitted for repurchase in connection with the death or “qualifying disability” (as defined in the SRP) of a stockholder. In order to preserve cash in light of the uncertainty relating to the economic impact of COVID-19 on the Company, in April 2020, the Boardboard of directors again suspended the SRP. As a result of the dateapproval by our board of this filingdirectors and our stockholders of the Plan of Liquidation, we do not expect to redeem any shares under the SRP remains suspended. For more information regardinggoing forward and expect that any future liquidity provided to stockholders will be in the SRP, referform of liquidating distributions. We can provide no assurances as to Part II, Item 5, “Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchasesthe timing, amount, or successful implementation of Equity Securities - Share Redemption Program.”the Plan of Liquidation. Cumulatively, through December 31, 2021,2023, pursuant to the SRP, we have redeemed 878,458 shares of common stock sold in the Offering for approximately $6.2 million.

Since our inception, our business has been managed by an external advisor. We do not have direct employees and all management and administrative personnel responsible for conducting our business and implementing the Plan of Liquidation are employed by our advisor. Currently weWe are externally managed and advised by SRT Advisor, LLC, a Delaware limited liability company (the “Advisor”) pursuant to an advisory agreement with the Advisor (the “Advisory Agreement”) initially executed on August 10, 2013, and subsequently renewed every year through 2022.2024. The current term of the Advisory Agreement terminates on August 9, 2022.2024. Effective April 1, 2021, the Advisor was acquired by PUR SRT Advisors LLC (“PUR”), an affiliate of PUR Management LLC, which isbecame an affiliate of L3 Capital, LLC. L3 Capital, LLC, is a real estate investment firm focused on institutional quality, value-add, prime urban retail and mixed-use investment within first tier U.S. metropolitan markets. As a result of this transaction, PUR controls SRT Advisor, LLC. Previously, the Advisor wasIn addition, an affiliate of Glenborough,L3 Capital, LLC (together with its affiliates, "Glenborough"), a privately held real estate investment and management company. Also effective April 1, 2021, Glenborough and PUR entered into an agreement pursuant to which PUR would perform the duties required and receive the benefits of theacts as our property management agreements between Glenborough and the Company, subject to Glenborough’s supervision. On February 2, 2022, Glenborough assigned its interest in the various property management agreements to PUR.manager.

Our office address is 550 W. Adams St,1 S Wacker Drive, Suite 200,3210, Chicago, Illinois 60661,60606, and our main telephone number is (312) 878-4848.

Our investment objectivesOn August 23, 2023, following board of director approval in May 2023, our stockholders approved the Plan of Liquidation. The principal purpose of the Plan of Liquidation is to maximize stockholder value by selling our assets, paying our debts and distributing the net proceeds from liquidation to our stockholders. As such we are to:currently marketing all of our properties for sale.

We can give no assurance regarding the timing of asset dispositions in connection with the implementation of the Plan of Liquidation, the sale prices we will receive for our assets, and the amount or timing of any liquidating distributions to stockholders; and

Business Strategy

We have fundedOur sole purpose is to wind up our investments in real properties and other real-estate related assets primarily with the proceeds from the Offering and debt financing. We intend to fund our future cash needs, including any future investments, with debt financing, cash from operations, proceeds to us from asset sales, cash flows from investments in joint venturesaffairs and the proceeds from any offeringsliquidation of our securities that we may conductassets with no objective to continue or to engage in the future.

Investment Portfolio

As of December 31, 2021, in addition to one development project and a property placed in service, as described below,2023, our portfolio included six wholly-ownedretail properties, excluding a land parcel, which we refer to as “our properties” or “our portfolio,” comprising an aggregate of approximately 27,000 square feet of single and multi-tenant, commercial retail space located in one state,California, which we purchased for an aggregate purchase price of approximately $35.3 million. Additionally, our portfolio includes an improved land parcel. Refer to Item 2, “Properties” for additional information on our portfolio.

We use, and may continue to use in the future,have used secured and unsecured debt as a means of providing additional funds for the acquisition of real property, real estate-related loans, and other real estate-related assets. Our use of leverage increases the risk of default on loan payments and the resulting foreclosure on a particular asset. In addition, lenders may have recourse to assets other than those specifically securing the repayment of our indebtedness. As of December 31, 2021,2023, our aggregate outstanding indebtedness including deferred financing costs, net of accumulated amortization,related to the SRT Loan and totaled approximately $39.8$18.0 million, or 56.9%63.6% of the bookliquidation value of our total assets.

Our aggregate borrowings,We did not satisfy the financial covenants necessary to extend the SRT Loan for an additional one-year term on its January 9, 2024 maturity date and we are in maturity default with respect to the loan for failure to pay the amount outstanding and due. The SRT Loan is secured by all of our retail properties. As a result of the default we are paying increased debt service due to the default interest rate, and unsecured,the lender could commence foreclosure proceedings on our properties in satisfaction of the debt. Although we are reviewedin negotiations with the lender to modify the terms of the SRT Loan and secure an extension of the maturity date, we can provide no assurances we will be successful. The maturity default and the related adverse impacts to us as discussed in additional detail under “Special Note Regarding Forward-Looking Statements” could have an adverse effect on our implementation of the Plan of Liquidation and the amount of and timing of liquidating distributions to be received by our board of directors at least quarterly. Under our Articles of Amendment and Restatement, as amended, which we refer to as our “charter,” we are prohibited from borrowing in excess of 300% of the value of our net assets. Net assets for purposes of this calculation is defined to be our total assets (other than intangibles), valued at cost prior to deducting depreciation, reserves for bad debts and other non-cash reserves, less total liabilities. However, we may temporarily borrow in excess of these amounts if such excess is approved by a majority of the independent directors and disclosed to stockholders in our next quarterly report, along with an explanation for such excess. As of December 31, 2021 and 2020, our borrowings were approximately 120.2% and 90.1%, respectively, of the book value of our net assets.

Economic Dependency

We are dependentdepend on our Advisor and its affiliates for certain services that are essential to us, including the disposition of real estate and real estate-related investments and, to the extent we acquire additional assets, the identification, evaluation, financing, negotiation and purchase of these assets, management of the daily operations of our real estate and real estate-related investment portfolio, and other general and administrative responsibilities. In the event that our Advisor is unable to provide such services to us, we will be required to obtain such services from other sources.

Although we believe that we are well-positioned to compete effectively in each facet of our business, there is enormous competition in our market sector and there can be no assurance that we will compete effectively or that we will not encounter increased competition in the future we will be subjectthat could limit our ability to significant competition in seeking real estate investments and tenants. We compete with many third-parties engaged in real estate investment activities, including other REITs, other real estate limited partnerships, banks, mortgage bankers, insurance companies, mutual funds, institutional investors, investment banking firms, lenders, hedge funds, governmental bodies, and other entities. Some ofconduct our competitors may have substantially greater financial and other resources than we have and may have substantially more operating experience than us. The marketplace for real estate equity and financing can be volatile. There is no guarantee that in the future we will be able to obtain financing or additional equity on favorable terms, if at all. Lack of available financing or additional equity could result in a further reduction of suitable investment opportunities and create a competitive advantage for other entities that have greater financial resources than we do.business effectively.

Tax Status

We elected to be taxed as a REIT for U.S. federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, or the Internal Revenue Code, beginning with the taxable year ended December 31, 2009. We believe we are organized and operate in such a manner as to qualify for taxation as a REIT under the Internal Revenue Code, and we intend to continue to operate in such a manner, but no assurance can be given that we will operate in a manner so as to qualify or remain qualified as a REIT. As a REIT, we generally are not subject to federal income tax on our taxable income that is currently distributed to our stockholders, provided that distributions to our stockholders equal at least 90% of our taxable income, subject to certain adjustments. If we fail to qualify as a REIT in any taxable year without the benefit of certain relief provisions, we will be subject to federal income taxes on our taxable income at regular corporate income tax rates. We may also be subject to certain state or local income taxes, or franchise taxes.

We have elected to treat one of our subsidiaries as a taxable REIT subsidiary, which we refer to as a TRS. In general, a TRS may engage in any real estate business and certain non-real estate businesses, subject to certain limitations under the Internal Revenue Code. A TRS is subject to federal and state income taxes.

Environmental Matters

All real property investments and the operations conducted in connection with such investments are subject to federal, state and local laws and regulations relating to environmental protection and human health and safety. Some of these laws and regulations may impose joint and several liability on customers, owners or operators for the costs to investigate or remediate contaminated properties, regardless of fault or whether the acts causing the contamination were legal.

Under various federal, state and local environmental laws, a current or previous owner or operator of real property may be liable for the cost of removing or remediating hazardous or toxic substances on a real property. Such laws often impose liability whether or not the owner or operator knew of, or was responsible for, the presence of such hazardous or toxic substances. In addition, the presence of hazardous substances, or the failure to properly remediate these substances, may adversely affect our ability to sell, rent or pledge such real property as collateral for future borrowings. Environmental laws also may impose restrictions on the manner in which real property may be used or businesses may be operated. Some of these laws and regulations have been amended so as to require compliance with new or more stringent standards as of future dates. Compliance with new or more stringent laws or regulations or stricter interpretations of existing laws may require us to incur material expenditures or may impose material environmental liability. Additionally, tenants’ operations, the existing condition of land when we buy it, operations in the vicinity of our real properties, such as the presence of underground storage tanks, or activities of unrelated third-parties may affect our real properties. There are also various local, state and federal fire, health, life-safety and similar regulations with which we may be required to comply and which may subject us to liability in the form of fines or damages for noncompliance. In connection with the acquisition and ownership of real properties, we may be exposed to such costs in connection with such regulations. The cost of defending against environmental claims, of any damages or fines we must pay, of compliance with environmental regulatory requirements or of remediating any contaminated real property could materially and adversely affect our business, lower the value of our assets or results of operations and, consequently, lower the amounts available for distribution to our stockholders.

We do not believe that compliance with existing environmental laws will have a material adverse effect on our consolidated financial condition or results of operations. However, we cannot predict the impact of unforeseen environmental contingencies or new or changed laws or regulations on properties in which we hold an interest, or on properties that may be acquired directly or indirectly in the future.

Human Capital

We have no paid employees. The employees of our Advisor and its affiliates provide management, acquisition, disposition, advisory and certain administrative services for us.

We are subject to the reporting and information requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and, as a result, file our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and other information (including exhibits to our reports) with the SEC. The SEC maintains a website (http://www.sec.gov) that contains our annual, quarterly and current reports, proxy and information statements and

other information we file electronically with the SEC. Access to these filings is free of charge on the SEC’s website as well as on our website (www.srtreit.com).

ITEM 1A. RISK FACTORS

ITEM 1B. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2. PROPERTIES

Property Portfolio

As of December 31, 2021,2023, our wholly-owned property portfolio included six retail properties, excluding a residual land parcel at Topaz Marketplace, which we refer to as “our properties” or “our portfolio,” comprising an aggregate of approximately 27,000 square feet of multi-tenant, commercial retail space located in one state. We purchased our properties for an aggregate purchase price of approximately $35.3 million.California. As of December 31, 2021,2023, approximately 86%85% of our wholly-owned real estate investments wereportfolio was leased (based on rentable square footage), with a weighted-average remaining lease term of approximately 6.35.2 years. As of December 31, 2020, approximately 79% ofThe following table provides summary information regarding the properties in our wholly-owned real estate investments were leased (based on rentable square footageportfolio as of December 31, 2020), with a weighted-average remaining lease term of approximately 6.3 years.2023 (dollar amounts in thousands):

Lease Expirations

The following table reflects the timing of tenant lease expirations at our wholly-owned properties as of December 31, 20212023 (dollar amounts in thousands):

Significant Tenants

As of December 31, 2021,2023, our real estate properties were leased to approximately 12 retail tenants over a diverse range of industries. The following table reflects information regarding tenants which account for more than 10% of our annualized minimum rent as of December 31, 20212023 (dollar amounts in thousands):

ITEM 3. LEGAL PROCEEDINGS

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

PART II

There is no established public trading market for our common stock. Therefore, there is a risk that a stockholder may not be able to sell our stock at a time or price acceptable to the stockholder. Unless and until our shares are listed on a national securities exchange, it is not expected that a public market for the shares will develop. Our stockholders have approved the Plan of Liquidation and we expect to distribute the net proceeds from liquidation upon the completion of the sale of our properties.

We are providing this estimated value per share to assist broker-dealers that participated in our initial public offering in meeting their customer account statement reporting obligation under Financial Industry Regulatory Authority (“FINRA”) Rule 2231. The valuation with an effective dateadopted the liquidation basis of April 30, 2020 was performed in accordance with the provisionsaccounting as of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the Institute for Portfolio Alternatives (formerly known as the Investment Program Association) (“IPA”) in April 2013.

Our expectations about the implementation of the Plan of Liquidation and the amount of any liquidating distributions that we pay to our stockholders and when we will pay them are subject to risks and uncertainties and are based on certain estimates and assumptions, one or more of which may prove to be incorrect. As a liquidation valueresult, the actual amount of any liquidating distributions that we pay to our assetsstockholders may be more or less than our estimate and the liquidating distributions may be paid later than we predict. There are many factors that may affect the amount of liquidating distributions we will ultimately pay to our stockholders. If we underestimated our existing obligations and liabilities or the amount our shares of common stock would trade at on a national securities exchange. The estimated value per share does not reflect a discount for the fact that we are externally managed, nor does it reflect a real estate portfolio premium/discount versus the sum of the individual property values. The estimated value per share also does not take into account estimated disposition coststaxes, transaction fees and fees for real estate properties that are not held for sale, debt prepayment penalties that could apply upon the prepayment of certain of our debt obligations or the impact of restrictions on the assumption of debt.

Limitations ofNo assurance can be given that any liquidating distributions we pay to our stockholders will equal or exceed the March 2024 Estimated Liquidation Value Per Share

As of March 21, 2022,25, 2024, we had 10,752,966 shares of our common stock outstanding held by a total of approximately 2,8262,822 stockholders. The number of stockholders is based on the records of our transfer agent.

In order to qualify as a REIT, we are required to distribute at least 90% of our annual REIT taxable income, subject to certain adjustments, to our stockholders. Our board of directors will continue to evaluateregularly evaluates the amount and timing of future quarterly distributions based on our operational cash needs.

SomeIn accordance with the Plan of Liquidation, our objectives are to pursue an orderly liquidation of our company by selling or otherwise disposing of our remaining assets, paying or otherwise settling our debts and our known liabilities, providing for the payment of unknown or contingent liabilities, distributing the net proceeds from liquidation to our stockholders and winding up our operations and dissolving our company. We may pay multiple, or a single, liquidating distribution(s) to our stockholders during the liquidation process. We will pay the final liquidating distribution after we sell all of our distributionsassets, pay or provide for all of our known liabilities and provide for unknown liabilities. We expect to complete these activities within 24 months of August 23, 2023, the day we received stockholder approval of the Plan of Liquidation. A final liquidating distribution to our stockholders may not be paid until all of our liabilities have been paid,satisfied.

Our expectations about the amount of liquidating distributions that we will pay and in the futurewhen we will pay them are based on many estimates and assumptions, one or more of which may continueprove to be paid, from sources otherincorrect. As a result, the actual amount of liquidating distributions we pay to our stockholders may be more or less than cash flows from operations.

Our board of directors has adopted a share redemption program that may enableenabled our stockholders to sell their shares of common stock to us in limited circumstances (the “SRP”), subject to the significant restrictions and limitations of the program. From January 2013 until April 2015, the SRP was suspended with respect to all redemption requests. In April 2015 the SRP was reinstated solely with respect to shares submitted for repurchase in connection with the death or “qualifying disability” (as defined in the SRP) ofAs a stockholder. Under the SRP, as amended to date, the number of shares to be redeemed is limited to the lesser of (i) a total of $3.8 million for redemptions sought upon a stockholder’s death and a total of $1.2 million for redemptions sought upon a stockholder’s qualifying disability, and (ii) 5%result of the weighted-average numberapproval by our board of shares ofdirectors and our common stock outstanding during the prior calendar year. Share repurchases pursuant to the SRP are made at our sole discretion. We reserve the right to reject any redemption request for any reason or no reason or to amend or terminate the share redemption program at any time subject to the notice requirements in the SRP.

During the quarter ended December 31, 2021,2023, we did not redeem any shares. Cumulatively, through December 31, 2021, we have redeemed 878,458 shares for $6.2 million. We have not presented information regarding submitted and unfulfilled redemption requests for the quarter ended December 31, 2021, as our redemption program is suspended and we believe many stockholders who may otherwise desire to have their shares redeemed have not submitted a request due to the suspension of the program.

During the year ended December 31, 2021,2023, we did not sell any equity securities that were not registered under the Securities Act of 1933.

The following discussion and analysis should be read in conjunction with our accompanying consolidated financial statements and the notes thereto included in this Annual Report. Also refer to “Forward Looking Statements” preceding Part I.

As used herein, the terms “we,” “our,” “us,” and “Company” refer to Strategic Realty Trust, Inc., and, as required by context, Strategic Realty Operating Partnership, L.P., a Delaware limited partnership, which we refer to as our “operating partnership” or “OP”, and to their respective subsidiaries. References to “shares” and “our common stock” refer to the shares of our common stock. 

Overview

We are a Maryland corporation that was formed on September 18, 2008, to invest in and manage a portfolio of income-producing retail properties, located in the United States, real estate-owning entities and real estate-related assets, including the investment in or originationStates. As of mortgage, mezzanine, bridge and other loans related to commercial real estate. During the first quarter of 2016, we also invested, through joint ventures, in two significant retail projects under development, one of which was substantially completed during the year ended December 31, 2020. 2023, our property portfolio included six retail properties, excluding a land parcel, comprising an aggregate of approximately 27,000 square feet of multi-tenant, commercial retail space located in California.

We have elected to be taxed as a real estate investment trust (“REIT”) for federal income tax purposes, commencing with the taxable year ended December 31, 2009, and we have operated and intend to continue to operate in such a manner. We own substantially all of our assets and conduct our operations through our operating partnership, of which we are the sole general partner. We also own a majority of the outstanding limited partner interests in the operating partnership.

Since our inception, our business has been managed by an external advisor. We do not have direct employees and all management and administrative personnel responsible for conducting our business are employed by our advisor. Currently we are externally managed and advised by SRT Advisor, LLC, a Delaware limited liability company (the “Advisor”) pursuant to an advisory agreement with the Advisor (the “Advisory Agreement”) initially executed on August 10, 2013, and subsequently renewed every year through 2022.2023. The current term of the Advisory Agreement terminates on August 9, 2022. Effective2024. As of April 1,

2021, the Advisor merged with PUR SRT Advisors LLC, an affiliate of PUR Management LLC, which is an affiliate of L3 Capital, LLC. L3 Capital, LLC, is a real estate investment firm focused on institutional quality, value-add, prime urban retail and mixed-use investment within first tier U.S. metropolitan markets.

As a result of this transaction, PUR SRT Advisors LLC, controls SRT Advisor, LLC.the approval of the Plan of Liquidation by our stockholders in August 2023, we adopted the liquidation basis of accounting as of July 1, 2023, as described further in Note 3,“Summary of Significant Accounting Policies - Principles of Consolidation and Basis of Presentation.”

Given the ongoing workforce shortages, global supply chain bottlenecks and shortages, recent macroeconomic trends, including inflation and rising interest rates, we continue to monitor and address risks related to the general state of COVID-19the economy on our portfolio and retail tenants and the impact on our ability to implement the Plan of Liquidation.

Since March 2020, COVID-19early 2022, inflation in the United States accelerated and, while moderating compared to year-over-year increases in 2021 and 2022, may continue at a relatively elevated level in the near-term. Rising inflation could have an adverse impact on our variable rate debt, as well as general and administrative expenses, as these costs could increase at a rate higher than our rental and other revenue. In addition, our retail tenants may experience decreased revenue as a result of rising inflation and reduced consumer spending. The Federal Reserve has raised interest rates to combat inflation and restore price stability and rates may continue to rise. As a result, such increases may result in higher debt service costs, which will adversely affect our cash flows. In addition, the rising interest rates have resulted in a lack of lending activity in the debt markets which may impact the ability of buyers for our properties to obtain favorable financing. Further, historically, during periods of increasing interest rates, real estate valuations have generally decreased due to rising capitalization rates, which tend to move directionally with interest rates. Consequently, prolonged periods of higher interest rates may negatively impact the valuation of our real estate assets and the effortsamount of liquidating distributions we pay to contain its spread have significantly impactedour stockholders. Although the global economy, the U.S. economy, the economiesextent of the local markets throughout California in whichany prolonged periods of higher interest rates remains unknown at this time, negative impacts to our properties are predominately located,cost of capital and the broader financial markets. Nearly every industry has been impacted directly or indirectly, and the U.S. retail market has come under severe pressure duecost of capital to numerous factors, including preventative measures taken by local, state and federal authorities to alleviate the public health crisis such as mandatory business closures, quarantines, restrictions on travel and shelter-in-place or stay-at-home orders. California, where allany prospective buyers of our properties are located instituted various measures that required closuremay adversely affect our ability to implement the Plan of retail businesses or limited the ability of our tenants to operate their businesses. As of June 30, 2021, due to declining new cases and hospitalizations, the state of California lifted COVID-19 related restrictions. However, there remains uncertainty as to the time, date and extent to which these restrictions will be reinstated, businesses of tenants that have closed will reopen or when customers will re-engage with tenants as they have in the past. Due to this uncertainty, some of our tenants have been experiencing hardships, as they were unable to operate at full capacity until the middle of June 2021.

On January 18, 2023, we could not agree with these tenants on lease changes acceptable to both parties. During the year ended December 31, 2021, these tenants terminated their leases and were replaced with new tenants.

On December 30, 2021, we obtained a $4.0 million Unsecured Loan from PUR Holdings Lender, LLC, an affiliateMay 12, 2023, our board of directors unanimously approved the sale of all of our assets and our dissolution pursuant to the terms of the Advisor.Plan of Liquidation. The Unsecured Loan has a term of 12 months with an interest rate of 7.0% per annum, compounding monthly with the ability to pay-off during the termprincipal purpose of the loan. The Unsecured Loan matures on December 30, 2022, but on March 15, 2022, wePlan of Liquidation is to maximize stockholder value by selling our assets, paying our debts and PUR Holdings Lender, LLC amendeddistributing the loan agreementnet proceeds from liquidation to allow us to extendour stockholders. On August 23, 2023 our stockholders approved the maturity date until June 30, 2023.Plan of Liquidation.

Review of our Policies

Our board of directors, including our independent directors, has reviewed our policies, including with respect to the Plan of Liquidation, described in this Annual Report and determined that they are in the best interest of our stockholders because: (1) they increasebecause the likelihood that wePlan of Liquidation will be ablemore likely to successfully maintain and manage our current portfolio of investments and acquire additional income-producing properties and other real estate-related investments in the future; (2) our executive officers, directors and affiliates of our Advisor have expertise with the type of properties in our current portfolio; and (3) to the extent that we acquire additional real properties or other real estate-related investments in the future, the use of leverage should enable us to acquire assets and earn rental income more quickly, thereby increasing the likelihood of generating income for our stockholders.maximize stockholder value at this time.

Critical Accounting Policies and Estimates

Below is a discussion of the accounting policies and estimates that management considersbelieves are or will be critical during our liquidation. We consider these policies critical in that they involve significant management judgments and assumptions, require estimates about matters that are inherently uncertain and because they are important for understanding and evaluating our reported financial results. These judgments affect the reported amounts of assets and liabilities and our disclosure of contingent assets and liabilities atas of the dates of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in our consolidated financial statements. Additionally, other companies may utilize different estimates that may impact

Subsequent to the comparabilityadoption of the liquidation basis of accounting, we are required to estimate all costs and income we expect to incur and earn through the end of liquidation including the estimated amount of cash we expect to collect through the disposal of our assets and the estimated costs to dispose of our assets.

Pursuant to our stockholders’ approval of the Plan of Liquidation, we adopted the liquidation basis of accounting as of and for the periods subsequent to July 1, 2023 (as approval of the Plan of Liquidation became imminent during the month of July 2023 based on the results of operationsour solicitation of proxies from our stockholders for their approval of the Plan of Liquidation). Accordingly, on July 1, 2023, assets were adjusted to thosetheir estimated net realizable value, or liquidation value, which represents the estimated amount of companiescash or other consideration that we expect to receive through the disposal of our assets as we carry out our Plan of Liquidation. The liquidation values of our remaining real estate properties are presented on an undiscounted basis. Liabilities are carried at their contractual amounts due or estimated settlement amounts.

We accrue costs and income that we expect to incur and earn through the completion of our liquidation, including the estimated amount of cash or other consideration that we expect to receive through the disposal of our assets and the estimated costs to dispose of our assets, to the extent we have a reasonable basis for estimation. These amounts are classified as a liability for estimated costs in similar businesses.excess of estimated receipts during liquidation on the Consolidated Statement of Net Assets. Actual costs and income may differ from amounts reflected in the financial statements because of the inherent uncertainty in estimating future events. These differences may be material. See Note 2, “Plan of Liquidation” and Note 4, “Liabilities for Estimated Costs in Excess of Estimated Receipts During Liquidation” for further discussion. Actual costs incurred but unpaid as of December 31, 2023, are included in accounts payable and accrued expenses, due to affiliate and other liabilities on the Consolidated Statement of Net Assets.

We evaluateevaluated each acquisition of real estate to determine if the integrated set of assets and activities acquired meetmet the definition of a business and needneeded to be accounted for as a business combination. If either of the following criteria iswas met, the integrated set of assets and activities acquired would not qualify as a business:

An acquired process is considered substantive if:

Generally, we expectexpected that acquisitions of real estate will not meet the revised definition of a business because substantially all of the fair value is concentrated in a single identifiable asset or group of similar identifiable assets (i.e. land, buildings, and related intangible assets), or because the acquisition does not include a substantive process in the form of an acquired workforce or an acquired contract that cannot be replaced without significant cost, effort or delay.

In asset acquisitions, the purchase consideration, including acquisition costs, is allocated to the individual assets acquired and liabilities assumed on a relative fair value basis. As a result, asset acquisitions do not result in the recognition of goodwill or a bargain purchase gain.

Depreciation and amortization iswas computed using a straight-line method over the estimated useful lives of the assets as follows:

Tenant improvement costs were recorded as capital assets areand depreciated over the tenant’s remaining lease term, which we determined approximatesby approximating the useful life of the improvement. Expenditures for ordinary maintenance and repairs arewere expensed to operations as incurred. Significant renovations and improvements that improve or extend the useful lives of assets arewere capitalized. Acquisition costs related to asset acquisitions arewere capitalized in the consolidated balance sheets.sheets prior to the adoption of the liquidation basis of accounting.

We continually monitormonitored events and changes in circumstances that could indicate that the carrying amounts of ourits investments in real estate and related intangible assets may not be recoverable. When indicators of potential impairment suggest that the carrying value of real estate and related intangible assets may not be recoverable, we assessassessed the recoverability by estimating whether we willwould recover the carrying value of the real estate and related intangible assets through its undiscounted future cash flows (excluding interest) and its eventual disposition. If, based on this analysis, we dodid not believe that weit will be able to recover the carrying value of the real estate and related intangible assets and liabilities, we would recordrecorded an impairment loss to the extent that the carrying value exceeds the estimated fair value of the investments in real estate and related intangible

assets. Key inputs that we estimateestimated in this analysis include projected rental rates, capital expenditures, property salessale capitalization rates, and expected holding period of the property.

In accordance with the liquidation basis of accounting, as of July 1, 2023, rents and other receivables were adjusted to their net realizable value. We recorded an impairment loss duringperiodically evaluate the year ended December 31, 2021collectibility of approximately $6.9 millionamounts due from tenants. Any changes in the collectibility of the receivables are reflected as a change to our net assets in liquidation.

We estimated the collectability of its tenant receivables related to base rents, including deferred rents receivable, expense reimbursements and other revenue or income.

We analyzed tenant receivables, deferred rent receivable, historical bad debts, customer creditworthiness, current economic trends and changes in customer payment terms when evaluating the operating propertyadequacy of the allowance for doubtful accounts. In addition, with respect to tenants in bankruptcy, we made estimates of the expected recovery of pre-petition and post-petition claims in assessing the development propertyestimated collectability of the related receivable. In some cases, the ultimate resolution of these claims could exceed one year. When a tenant is in bankruptcy, we recorded a bad debt reserve for the tenant’s receivable balance and generally did not recognize subsequent rental revenue until cash was received or until the tenant was no longer in bankruptcy and had the ability to make rental payments.

We own through joint ventures,certain properties with leases that include provisions for the tenant to pay contingent rental income based on a percent of the tenant’s sales upon the achievement of certain sales thresholds or other targets which wasmay be monthly, quarterly or annual targets. Contingent rental income is not contemplated under liquidation accounting unless there is a reasonable basis to estimate future receipts.

Revenues included inminimum rents, expense recoveries and percentage rental payments on our consolidated statement of operations and comprehensive income beginning January 1, 2022 until the Company’s adoption of the liquidation basis of accounting as of and for the periods subsequent to July 1, 2023. Minimum rents were recognized on an accrual basis over the terms of the related leases on a straight-line basis when collectability was reasonably assured and the tenant had taken possession or controls the physical use of the leased property. If the lease provides for tenant improvements, we determined whether the tenant improvements, for accounting purposes, are owned by the tenant or us. When we were the owner of the tenant improvements, the tenant was not considered to have taken physical possession or have control of the physical use of the leased asset until the tenant improvements were substantially completed. When the tenant was the owner of the tenant improvements, any tenant improvement allowance that was funded was treated as a lease incentive and amortized as a reduction of revenue over the lease term. Tenant improvement ownership was determined based on various factors including, but not limited to:

For leases with minimum scheduled rent increases, we recognized income on a straight-line basis over the operating propertylease term when collectability was reasonably assured. Recognizing rental income on a straight-line basis for leases resulted in recognized revenue amounts which differ from those that are contractually due from tenants on a cash basis. If we recorded a $5.6 million non-cash impairment chargedetermined the collectability of straight-line rents was not reasonably assured, we limited future recognition to amounts contractually owed and paid, and, when appropriate, established an allowance for estimated losses.

We elected the lessor practical expedient to not separate common area maintenance and reimbursement of real estate taxes from the associated lease for all existing and new leases as the timing and pattern of payments and associated lease payments are the same. The timing of revenue recognition remained the same for our existing leases and new leases. Revenues related to our leases continued to be reported on one line in the presentation within the statement of operations and comprehensive income beginning January 1, 2022 until our adoption of the liquidation basis of accounting as of and for the periods subsequent to July 1, 2023, as a result of changes in cash flow estimates including a change in lease projections, which triggered the future estimated undiscounted cash flowselecting this lessor practical expedient. We continued to be lower than the net carrying value of the property. The decrease in cash flow projections was primarily due to reduced demand for the retail space at the properties, including potential tenants backing out of their leases, resulting in longer lease-up periods and a decrease in projected rental rates. Estimatescapitalize its direct leasing costs. These costs were also impacted by the COVID-19 pandemic which we believe will result in additional challenges to lease the vacant space. The non-cash impairment related to the operating property is included in building and improvements in our consolidated balance sheets in this Annual Report. For the development property we recorded a $1.3 million non-cash impairment charge related to development costs incurred to date. We recorded the non-cash impairment charge as a result of changes in cash flow estimates, which triggered the future estimated undiscounted cash flowsobtaining new leases, and renewing leases, and were paid to be lower than the net carrying valueour Advisor. Additionally, we were not a lessee of the property. The decrease in cash flow projections was primarily due to an adverse change in legal factors including an expiration of entitlements resulting in higher costs to re-entitle the property and proposed zoning changes. Estimates were also impactedreal estate or equipment, as it is externally managed by the COVID-19 pandemic, which we believe will result in higher costs to construct the property due to supply chain issues and higher building material costs. We recorded an impairment loss during the year ended December 31, 2020 of approximately $13.4 million related to the development project and the operating property we own through joint ventures, which was included in our consolidated statement of operations in this Annual Report. Refer to Part II, Item 5. “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities” for more information regarding the methodologies used to estimate fair value of the investments in real estate.

Fair Value Measurements - Going Concern Basis

Under generally accepted accounting principles (“GAAP”),GAAP, we arewere required to measure or disclose certain financial instruments at fair value on a recurring basis. In addition, we arewere required to measure other financial instruments and balances at fair value on a non-recurring basis (e.g., carrying value of impaired real estate loans receivable and long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories:

When available, we utilizeutilized quoted market prices or other observable inputs (Level 2 inputs), such as interest rates or yield curves, from independent third-party sources to determine fair value and classify such items in Level 1 or Level 2. In instances where the market for a financial instrument is not active, regardless of the availability of a non-bindingnonbinding quoted market price, observable inputs might not be relevant and could require us to use significant judgment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third-party may rely more on models with inputs based on information available only to that independent third-party.third party. When we determinedetermined the market for an asset owned by usit to be illiquid or when market transactions for similar instruments do not appear orderly, we useused several valuation sources (including internal valuations, discounted cash flow analysis and quoted market prices)external appraisals) and establishestablished a fair value by assigning

Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument.

We considerconsidered the following factors to be indicators of an inactive marketmarket: (1) there are few recent transactions; (2) price quotations are not based on current information; (3) price quotations vary substantially either over time or among market makers (for example, some brokered markets); (4) indexes that previously were highly correlated with the fair values of the asset or liability are demonstrably uncorrelated with recent indications of fair value for that asset or liability; (5) there is a significant increase in implied liquidity risk premiums, yields, or performance indicators (such as delinquency rates or loss severities) for observed transactions or quoted prices when compared with the our estimate of expected cash flows, considering all available market data about credit and other nonperformance risk for the asset or liability; (6) there is a wide bid-ask spread or significant increase in the bid-ask spread; (7) there is a significant decline or absence of a market for new issuances (that is, a primary market) for the asset or liability or similar assets or liabilities; and (8) little information is released publicly (for example, a principal-to-principal market).

We considerconsidered the following factors to be indicators of non-orderly transactionstransactions: (1) there was not adequate exposure to the market for a period before the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets or liabilities under current market conditions; (2) there was a usual and customary marketing period, but the seller marketed the asset or liability to a single market participant; (3) the seller is in or near bankruptcy or receivership (that is, distressed), or the seller was required to sell to meet regulatory or legal requirements (that is, forced); and (4) the transaction price is an outlier when compared with other recent transactions for the same or similar assets or liabilities.

We have elected to be taxed as a REIT under the Internal Revenue Code. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our annual REIT taxable income to stockholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal results of operations as calculated in accordance with GAAP). As a REIT, we generally will not be subject to federal income tax on income that we distribute as dividends to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax on our taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost, unless the Internal Revenue Service grants us relief under certain statutory provisions. Such an event could materially and adversely affect our net income and net cash available for distribution to stockholders. However, we believe that we are organized and operate in such a manner as to qualify for treatment as a REIT. Even if we qualify as a REIT, we may be subject to certain state or local income taxes and to U.S. Federal income and excise taxes on our undistributed income.

We evaluate tax positions taken in the consolidated financial statements under the interpretation for accounting for uncertainty in income taxes. As a result of this evaluation, we may recognize a tax benefit from an uncertain tax position only if it is “more-likely-than-not” that the tax position will be sustained on examination by taxing authorities.

When necessary, deferred income taxes are recognized in certain taxable entities. Deferred income tax is generally a function of the period’s temporary differences (items that are treated differently for tax purposes than for financial reporting purposes). A valuation allowance for deferred income tax assets is provided if all or some portion of the deferred income tax asset may not be realized. Any increase or decrease in the valuation allowance is generally included in deferred income tax expense.

Our tax returns remain subject to examination and consequently, the taxability of our distributions is subject to change.

Portfolio Investments

As of December 31, 2021,2023, our portfolio included:

As of December 31, 20212023 and 2020,2022, approximately 86%85% and 79%88% of our portfolio was leased (based on rentable square footage), respectively, with a weighted-average remaining lease term of approximately 6.35.2 years for bothand 5.8 years, respectively. In each of 20212023 there were no property dispositions and 2020,in 2022 there was one property disposition.disposition (the Wilshire Joint Venture property) and one disposition of a property in the pre-development stage (the Sunset & Gardner Joint Venture property).

Leasing Information

There were threeno new leases added in our retail properties during the year ended December 31, 2021.2023. The following table provides information regarding our leasing activity for the year ended December 31, 20212023 for properties we held as of December 31, 2021.2023.

In light of the year ended December 31, 2021, versusadoption of liquidation basis accounting as of July 1, 2023 and our liquidation pursuant to the year ended December 31, 2020.

As described above under “—Overview – Plan of Liquidation,” our board of directors and our stockholders have approved the sale of Shops at Turkey Creekall of our assets and rent concessions providedour dissolution pursuant to replacement tenants. Partially offset by the expirationterms of COVID-19 pandemic-related rent concessionsthe Plan of Liquidation. We expect to sell all of our assets, pay all of our known liabilities, provide for unknown liabilities and higher rental incomedistribute the net proceeds from replacement tenants.

DepreciationLiquidation. We expect to use our cash on hand and amortization expenses

Our investments in real estate generate cash flow in the form of a gain on sale of Topaz Marketplace of approximately $0.9 million.

Due to our other cash needs. Currently we have used and expect to continue to use debt financing, net sales proceeds anddecreased cash flow from operations, caused in significant part by our significant tenant’s failure to pay rent owed to us, we did not satisfy the financial covenants necessary to exercise our one-year extension option for the SRT Loan on its January 9, 2024 maturity date, and we are in maturity default with respect to the loan for failure to pay the amount outstanding and due. As a result of the default we are paying increased debt service due to the default interest rate in effect of 5% above the rate that would otherwise be in effect (30-day SOFR, plus 2.8%),which we expect to adversely impact our ability to fund our short-term liquidity needs. We are in discussions with the lender to modify the terms of the SRT Loan and secure an extension of the maturity date; however, we can provide no assurances we will be successful in modifying the SRT Loan. Further, we expect that any extension of the SRT Loan would be on terms and conditions less favorable to us than previously negotiated, including a potential requirement for cash flow sweeps at our properties, and we would be required to pay various fees to the lender in connection with securing any extension of the loan. These events would adversely impact our ability to fund our short-term liquidity needs.

As of December 31, 2021,2023, our cash and cash equivalents were approximately $1.8$1.3 million and we had $0.6$0.3 million of restricted cash (funds held by the lenders for property taxes, insurance, tenant improvements, leasing commissions, capital expenditures, rollover reserves and other financing needs).

Our aggregate borrowings, secured and unsecured, are reviewed bySubject to our board of directors at least quarterly. Under our Articles of Amendment and Restatement, as amended, which we referability to as our “charter,” we are prohibited from borrowing in excess of 300% of the value of our net assets. Net assets for purposes of this calculation is definedagree to be our total assets (other than intangibles), valued at cost prior to deducting depreciation, reserves for bad debts and other non-cash reserves, less total liabilities. However, we may temporarily borrow in excess of these amounts if such excess is approved by a majority of the independent directors and disclosed to stockholders in our next quarterly report, alongan extension with an explanation for such excess. As of December 31, 2021 and 2020, our borrowings were approximately 120.2% and 90.1%, respectively, of the carrying value of our net assets.

In addition, the fixed costs associated with managing a public REIT, including the significant cost of corporate compliance with all federal, state and local regulatory requirements applicable to us with respect to our business activities, are substantial. Such costs include, without limitation, the cost of preparing or causing to be prepared all financial statements required under applicable regulations and contractual undertakings and all reports, documents and filings required under the Exchange Act, or other federal or state laws for at least the next twelve monthsgeneral maintenance of our status as a REIT, under the applicable provisions of the Code, or otherwise. Given the size of our portfolio of properties, these costs constitute a significant percentage of our gross income, reducing our cash flow. Moreover, over the long term, if we are unsuccessful in implementing the Plan of Liquidation and beyond. However, thisour cash flow from operations does not increase from current levels, whether through increased occupancy or rent rates, we will have to address a liquidity deficiency as our cash flow is not sufficient to cover our current operating expenses over the long

term. These forward-looking statement isstatements are subject to a number of uncertainties, including with respect to the duration of the COVID-19 pandemic,current economic environment and there can be no guarantee that we will be successful with our plan. Moreover, over

During the long term, ifsix months ended June 30, 2023, net cash used in operating activities was $817 thousand.

Cash flows used by financing activities during the year ended December 31, 2022, primarily consisted of repayments of $12.7 million, $8.7 million, and $3.0 million related to our cash flowWilshire Construction Loan (as defined below), Sunset & Gardner Loan (as defined below), and Unsecured Loan (as defined below), respectively. Partially offset by proceeds of $2.0 million from operations does not increasethe draw down on the Unsecured Loan from current levels, we may have to address a liquidity deficiency. We are actively exploring options should cash flow from operations not sufficiently improve, such as a salePUR Holdings Lender, LLC, an affiliate of one or more assets that are not generating positive cash flow or the sale of equity to an institutional investor.

On December 24, 2019, we entered into a Loan Agreementloan agreement (the “SRT Loan Agreement”) with PFP Holding Company, LLC (the “SRT Lender”) for a non-recourse secured loan (the “SRT Loan”).

We have an optionare currently in maturity default for failure to pay the amount of the debt outstanding and due to the SRT Lender on the January 9, 2024 maturity date. Although we are in discussions with the SRT Lender to extend the term of the loan for two additional twelve-month periods, subjectSRT Loan while we complete our liquidation activities, no assurances can be provided that we will successfully extend the term of the SRT Loan. As a result of the default, we are required to pay an increased debt service payment due to the default interest rate in effect of 5% above the rate that would otherwise be in effect (30-day SOFR, plus 2.8%) and will be required to pay various fees to the lender in connection with securing an extension on our debt obligation. In addition, the SRT Lender could foreclose on the properties that secure the loan in satisfaction of certain covenantsthe debt. These events could have an adverse effect on our implementation of the Plan of Liquidation and conditions contained in the amount of and timing of liquidating distributions to be received by our stockholders.

Pursuant to the terms of SRT Loan, Agreement. We havewe had the right to prepay the SRT Loan in whole at any time or in part from time to time, subject to the payment of yield maintenance payments if such prepayment occurs in the first 18 months of the loan term, calculated through the 18th monthly payment date, as well as certain expenses, costs or liabilities potentially incurred by the SRT Lender as a result of the prepayment and subject to certain other conditions contained in the loan documents. Individual properties maycould be released from the SRT Loan collateral in connection with bona fide third-party sales, subject to compliance with certain covenants and conditions contained in the SRT Loan Agreement. Any prepayment or repayment on or before the first 12 months of the loan term in connection with a bona fide third-party sale of a property securing the SRT Loan shall only require the payment of yield maintenance payments calculated through the 12th monthly payment date.

As of December 31, 2021,2023, the SRT Loan had a principal balance of approximately $18.0 million. The SRT Loan is a floating LIBORSecured Overnight Financing Rate (“SOFR”) rate loan which bears interest at 30-day LIBORSOFR (with a floor of 1.50%) plus 2.80%. The default rate is equal to 5% above the rate that otherwise would be in effect. Monthly payments arewere interest-only with the entire principal balance and all outstanding interest due at maturity.

Pursuant to the SRT Loan, we mustwere required to comply with certain matters contained in the loan documents including but not limited to, (i) requirements to deliver audited and unaudited financial statements, SEC filings, tax returns, pro forma budgets, and quarterly compliance certificates, and (ii) minimum limits on our liquidity and tangible net worth. The SRT Loan contains customary covenants, including, without limitation, covenants with respect to maintenance of properties and insurance,

compliance with laws and environmental matters, covenants limiting or prohibiting the creation of liens, and transactions with affiliates.

In connection with the SRT Loan, we executed customary non-recourse carveout and environmental guaranties, together with limited additional assurances with regard to the condominium structures of the San Francisco assets.

On May 7, 2019, wethe Company refinanced and repaid ourits financing withfrom Loan Oak Fund, LLC with a new construction loan from ReadyCap Commercial, LLC (the “Lender”) (the “Wilshire Construction Loan”). As of December 31, 2021, theThe Wilshire Construction Loan had a principal balance of approximately $12.6 million, with future funding available up to a total of approximately $13.9 million, and bears an interest rate of 1-month LIBOR (with a floor of 2.467%) plus an interest margin of 4.25% per annum, payable monthly. TheOn September 14, 2022, the Company entered into the Modification and Extension Agreement with the Lender to extend the maturity date of the Wilshire Construction Loan is scheduled to mature on Mayfor an additional six-month period under the same terms and conditions. The new maturity date was November 10, 2022. On October 11, 2022, the Company consummated the disposition of the Wilshire Joint Venture Property for $16.5 million in cash, before customary closing and transaction costs. In connection with options to extend for two additional twelve-month periods, subject to certain conditions as stated in the loan agreement. Thedisposition of the Wilshire Joint Venture Property, the Company repaid the principal balance of the Wilshire Construction Loan isin the amount of $12.7 million, which was secured by a first Deed of Trust on the Wilshire Property. We executed a guaranty that guaranties that the loan interest reserve amounts are kept in compliance with the terms of the loan agreement. The Lender also required that a principal in the upstream owner of our joint venture partner in the Wilshire Joint Venture (the “Guarantor”), guarantees performance of borrower’s obligations under the loan agreement with respect to the completion of capital improvements to the property. We executed an Indemnity Agreement in favor of the Guarantor against liability under that completion guaranty except to the extent caused by gross negligence or willful misconduct, as well as for liabilities incurred under the Environmental Indemnity Agreement executed by the Guarantor in favor of the Lender. We used working capital funds of approximately $3.1 million to repay the difference between the Wilshire Construction Loan initial advance and the prior loan, to pay transaction costs, as well as to fund certain required interest and construction reserves.Property.

On October 29, 2018, wethe Company entered into a loan agreement with Lone Oak Fund, LLC (the “Sunset & Gardner Loan”). The Sunset & Gardner Loan hashad a principal balance of approximately $8.7 million, and had an initial interest rate of 6.9% per annum. The original Sunset & Gardner Loan agreement matured onAt each maturity date in October 31, 2019. We2019, 2020, and 2021, in connection with an extension of the loan for an additional twelve-month period, the interest rate of the loan was changed to 6.5%, 7.3%, and 7.9%, respectively. On September 7, 2022, the Company extended the Sunset & Gardner Loan for an additional twelve-month period under the same terms, withexcept an increase of the interest rate of 6.5% per annum. On July 31, 2020, we extended the Sunset & Gardner Loan for an additional twelve-month period under the same terms, with an interest rate of 7.3% per annum. On July 21, 2021, we extended the Sunset & Gardner Loan for an additional twelve-month period under the same terms, with an interest rate of 7.9%to 8.6% per annum. The new maturity date iswas October 31, 2022.2023. The Sunset & Gardner Loan iswas secured by a first Deed of Trust on the Sunset & Gardner Property.

On December 30, 2021, we obtained a $4.0 million unsecured loan (the “Unsecured Loan”) from PUR Holdings Lender, LLC, an affiliate of the Advisor. The Unsecured Loan has a term of 12 months with an interest rate of 7.0% per annum, compounding monthly with the ability to pay-off during the term of the loan. The Unsecured Loan requiresrequired draw downs in increments of no less than approximately $0.3 million. The Unsecured Loan will be due and payable upon the earlier of 12 months or the termination of the Advisory Agreement by us. The Unsecured Loan is guaranteed by us. On March 15, 2022, we and PUR Holdings Lender, LLC, amended the loan agreement to allow for an extension of the maturity date of the Unsecured Loan by six months, from December 30, 2022 to June 30, 2023, if we provide PUR Holdings Lender, LLC, with notice, pay an extension fee, and no event of default has occurred. AsOn August 2, 2022, PUR Holdings Lender, LLC agreed to an additional six month extension at the option of the Company to extend the maturity date until December 31, 20212023. We declined both options to extend the maturity date of the Unsecured Loan had anLoan. On December 23, 2022 the Company paid off the outstanding balance of $1.0$3.0 million.

Guidelines on Total Operating Expenses

We reimburse our Advisor for some expenses paid or incurred by our Advisor in connection with the services provided to us, except that we will not reimburse our Advisor for any amount by which our total operating expenses at the end of the four preceding fiscal quarters exceed the greater of (1) 2% of our average invested assets, as defined in our charter; and (2) 25% of our net income, as defined in our charter, or the “2%/25% Guidelines” unless a majority of our independent directors determines that such excess expenses are justified based on unusual and non-recurring factors. For the years ended December 31, 2021 and 2020, our total operating expenses did not exceed the 2%/25% Guidelines.

Inflation

The majority of our leases at our properties contain inflation protection provisions applicable to reimbursement billings for common area maintenance charges, real estate tax and insurance reimbursements on a per square foot basis, or in some cases, annual reimbursement of operating expenses above a certain per square foot allowance. We expect to include similar provisions in our future tenant leases designed to protect us from the impact of inflation. Due to the generally long-term nature of these leases, annual rent increases, as well as rents received from acquired leases, may not be sufficient to cover inflation and rent may be below market rates.

REIT Compliance

To qualify as a REIT for tax purposes, we are required to annually distribute at least 90% of our REIT taxable income, subject to certain adjustments, to our stockholders. We must also meet certain asset and income tests, as well as other requirements. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax (including any applicable alternative minimum tax) on our taxable income at regular corporate rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which our REIT qualification is lost unless the IRS grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to our stockholders.

Quarterly Distributions

As set forth above, in orderIn accordance with the Plan of Liquidation, our objectives are to qualify as a REIT, we are required to distribute at least 90%pursue an orderly liquidation of our annual REIT taxable income, subject to certain adjustments,company by selling or otherwise disposing of our remaining assets, paying or otherwise settling our debts and our known liabilities, providing for the payment of unknown or contingent liabilities, distributing the net proceeds from liquidation to our stockholders. stockholders and winding up our operations and dissolving our company. We may pay multiple, or a single, liquidating distribution(s) to our stockholders during the liquidation process. We will pay the final liquidating distribution after we sell all of our assets, pay or provide for all of our known liabilities and provide for unknown liabilities. We expect to complete these activities within 24 months of August 23, 2023, the day we received stockholder approval of the Plan of Liquidation. A final liquidating distribution to our stockholders may not be paid until all of our liabilities have been satisfied.

Our board of directors will continue to evaluateexpectations about the amount of future quarterlyliquidating distributions that we will pay and when we will pay them are based on many estimates and assumptions, one or more of which may prove to be incorrect. As a result, the actual amount of liquidating distributions we pay to our operationalstockholders may be more or less than we estimate and the liquidating distributions may be paid later than we predict. We do not expect to pay regular monthly distributions during the liquidation process. We intend to maintain adequate cash reserves for liquidity, debt repayments and other future capital needs.

Funds From Operations

FundsDue to the adoption of the Liquidation Plan, we are no longer reporting funds from operations, (“FFO”) is a supplemental non-GAAP financial measure of a real estate company’s operating performance. The National Association of Real Estate Investment Trusts, or “NAREIT”, an industry trade group, has promulgated this supplemental performance measure and defines FFO as net income, computed in accordance with GAAP, plus real estate related depreciation and amortization and excluding extraordinary items and gains and losses on the sale of real estate, and after adjustments for unconsolidated joint ventures (adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO.) It is important to note that not only is FFO not equivalent to our net income or loss as determined under GAAP,we no longer consider it also does not represent cash flows from operating activities in accordance with GAAP. FFO should not be considered an alternative to net income as an indication of our performance, nor is FFO necessarily indicative of cash flow as a measure of liquidity or our ability to fund cash needs, including the payment of distributions.

Related Party Transactions and Agreements

We are currently party to the Advisory Agreement, pursuant to which the Advisor manages our business in exchange for specified fees paid for services related to the investment of funds in real estate and real estate-related investments, management of our investments and for other services. Refer to Note 12.9. “Related Party Transactions” to our consolidated financial statements included in this Annual Report on Form 10-K for a discussion of the Advisory Agreement and other related party transactions, agreements and fees. 

Subsequent Events

Omitted as permitted under rules applicable to smaller reporting companies.

Our consolidated financial statements and supplementary data can be found beginning on Page F-1 of this Annual Report.

None.

Disclosure Controls and Procedures

As of the end of the period covered by this report, management, including our chief executive officer and chief financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon, and as of the date of, the evaluation, our chief executive officer and chief financial officer concluded that the disclosure controls and procedures were effective as of the end of the period covered by this report to ensure that information required to be disclosed in the reports we file and submit under the Exchange Act is recorded, processed, summarized and reported as and when required. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file and submit under the Exchange Act is accumulated and communicated to our management, including our chief executive officer and our chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) and 15d-15(f) promulgated under the Exchange Act. In connection with the preparation of this Annual Report, our management, including our chief executive officer and chief financial officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2021,2023, using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework (2013). Based on its assessment, our management concluded that, as of December 31, 2021,2023, our internal control over financial reporting was effective.

This Annual Report does not include an attestation report, or any other report of our independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our independent registered public accounting firm pursuant to the rules of the SEC applicable to smaller reporting companies.

Changes in Internal Control Over Financial Reporting

As of the three months ended December 31, 2021,2023, all items required to be disclosed under Form 8-K were reported under Form 8-K.

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

We willexpect to file a definitive Proxy Statement for our 20222024 Annual Meeting of Stockholders (the “2022“2024 Proxy Statement”) with the SEC, pursuant to Regulation 14A, not later than 120 days after the end of our fiscal year. Accordingly, certain information required by Part III has been omitted under General Instruction G(3) to Form 10-K. Only those sections of the 20222024 Proxy Statement that specifically address the items required to be set forth herein are incorporated by reference.

Code of Ethics

We have adopted a Code of Business Conduct and Ethics (the “Code of Ethics”) that contains general guidelines for conducting our business and is designed to help directors, employees and independent consultants resolve ethical issues in an increasingly complex business environment. The Code of Ethics applies to all of our officers, including our principal executive officer, principal financial officer, principal accounting officer, controller and persons performing similar functions and all members of our board of directors. The Code of Ethics covers topics including, but not limited to, conflicts of interest, record keeping and reporting, payments to foreign and U.S. government personnel and compliance with laws, rules and regulations. We will provide to any person without charge a copy of our Code of Ethics, including any amendments or waivers, upon written request delivered to our principal executive office at the address listed on the cover page of this Annual Report.

Audit Committee Financial Expert

The information required by this Item is incorporated by reference to the 20222024 Proxy Statement.

ITEM 11. EXECUTIVE COMPENSATION

The information required by this item is incorporated herein by reference to the 20222024 Proxy Statement.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT, AND RELATED STOCKHOLDER MATTERS

The information required by this item is incorporated herein by reference to the 20222024 Proxy Statement.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by this item is incorporated herein by reference to the 20222024 Proxy Statement.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this item is incorporated herein by reference to the 20222024 Proxy Statement.

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

The following documents are filed as a part of this Annual Report on Form 10-K:

ITEM 16. FORM 10-K SUMMARY

None.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders

We have audited the accompanying consolidated balance sheetsstatement of net assets (liquidation basis) of Strategic Realty Trust, Inc., and Subsidiaries (the “Company”) as of December 31, 2021 and 2020,2023, the related consolidated statement of changes in net assets (liquidation basis) for the period from July 1, 2023 to December 31, 2023, the consolidated balance sheet as of December 31, 2022, the related consolidated statements of operations and comprehensive income, equity, and cash flows for the years thenperiod from January 1, 2023 to June 30, 2023 and for the year ended December 31, 2022, and the related notes and financial statement schedule (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects the consolidatednet assets in liquidation of the Company as of December 31, 2023, and the changes in its net assets in liquidation for the period from July 1, 2023 to December 31, 2023 and the financial position of the Company as of December 31, 2021 and 2020,2022 and the consolidated results of itstheir operations and itstheir cash flows for the years thenperiod from January 1, 2023 to June 30, 2023 and for the year ended December 31, 2022, its, in conformity with accounting principles generally accepted in the United States of America.

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

ImpairmentNet Realizable Value of Long-Lived AssetsReal Estate

As describeddiscussed in Note 23 to the consolidated financial statements, the Company adopted the liquidation basis of accounting on July 1, 2023. The Company’s evaluationliquidation basis value of investments inits real estate related intangible assets, and properties under development (collectively “real estate assets”) for impairment involves an assessment of each real estate asset to determine whether events or changes in circumstances exist that indicate that the carrying value of real estate assets may not be recoverable. When indicators of potential impairment suggest that the carrying value of real estate assets may not be recoverable, the Company assesses the recoverability by estimating whether the Company will recover the carrying value of the real estate assets through its undiscounted future cash flows (excluding interest) and its eventual disposition. If, based on this analysis, the Company does not believe that it will be able to recover the carrying value of the real estate assets, the Company would record an impairment loss to the extent that the carrying value exceeds the estimated fair value of the real estate assets. Key inputs that the Company estimates in this analysis include projected rental rates, capital expenditures, property sale capitalization rates, and expected holding period of the property. As described in Notes 2, 3 and 4 to the consolidated financial statements, the Company’s gross carrying value of investments in real estate was $54.7 million and its value of properties under development was $16.1totaled $26.3 million as of December 31, 2021. During 2021,2023. As a result of the adoption of the liquidation basis of accounting, the Company recognized loss on impairment ofadjusted its real estate holdings to their estimated net realizable values, which represent the estimated amounts of $6.9 million.

estimated fair values. There ismethodologies. Management’s internal valuation models utilize significant assumptions such as market rents, lease up periods, discount rates, and capitalization rates. These significant assumptions require significant judgment by management.

The principal considerations in our conclusion that auditing management’s determination of the estimated net realizable values of real estate holdings is a critical audit matter were that our evaluation of the significant assumptions used by management when evaluatingrequired significant auditor effort, including the real estate assets for potential impairment.

We have served as the Company’s auditor since 2013.

CONSOLIDATED BALANCE SHEETSSTATEMENT OF NET ASSETS

(in thousands, except shares and per share amounts)thousands)

See accompanying notes to consolidated financial statements.

CONSOLIDATED STATEMENTS OF OPERATIONSBALANCE SHEETS

(in thousands, except shares and per share amounts)