~~PART I.~~

~~FINANCIAL INFORMATION~~

PART I. FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements (unaudited)

TRINITY PLACE HOLDINGS INC.

~~CONDENSED~~ CONSOLIDATED BALANCE SHEETS (unaudited)

(In thousands, except par value and share amounts)

September 30,
2017 December 31,
2016
(unaudited) (audited)
ASSETS

Real estate, net $ 58,762 $ 60,384
Cash and cash equivalents 34,876 4,678
Restricted cash 12,519 3,688
Investment in unconsolidated joint venture 12,860 13,939
Receivables, net 145 220
Deferred rents receivable 577 543
Prepaid expenses and other assets, net 2,770 2,149
Total assets $ 122,509 $ 85,601

LIABILITIES

Loans payable, net $ 48,294 $ 48,705
Secured line of credit - -
Accounts payable and accrued expenses 4,997 2,935
Pension liabilities 4,867 5,936
Total liabilities 58,158 57,576

Commitments and Contingencies

STOCKHOLDERS' EQUITY

Preferred stock, 40,000,000 shares authorized; no shares issued and outstanding - -
Preferred stock, $0.01 par value; 2 shares authorized, no shares issued and outstanding at September 30, 2017 and December 31, 2016 - -
Special stock, $0.01 par value; 1 share authorized, issued and outstanding at September 30, 2017 and December 31, 2016 - -
Common stock, $0.01 par value; 79,999,997 shares authorized; 36,806,915 and 30,679,566 shares issued at September 30, 2017 and December 31, 2016, respectively; 31,451,796 and 25,663,820 shares outstanding at September 30, 2017 and December 31, 2016, respectively 368 307
Additional paid-in capital 130,275 87,521
Treasury stock (5,355,119 and 5,015,746 shares at September 30, 2017 and December 31, 2016, respectively) (53,666 ) (51,086 )
Accumulated other comprehensive loss (3,161 ) (3,161 )
Accumulated deficit (9,465 ) (5,556 )

Total stockholders' equity 64,351 28,025

Total liabilities and stockholders' equity $ 122,509 $ 85,601


	June 30,		December 31,
	2023		2022

ASSETS

Real estate, net	$	63,312	$	64,651
Residential condominium units for sale		192,698		202,999
Cash and cash equivalents		4,395		1,548
Restricted cash		11,020		20,507
Prepaid expenses and other assets, net		1,882		3,774
Investments in unconsolidated joint ventures		—		4,386
Receivables		171		262
Deferred rents receivable		211		163
Right-of-use asset		753		945
Intangible assets, net		7,322		7,692
Total assets	$	281,764	$	306,927

LIABILITIES

Loans payable, net	$	195,547	$	208,762
Corporate credit facility, net		37,922		34,429
Secured line of credit, net		11,750		9,750
Note payable		—		5,863
Accounts payable and accrued expenses		24,559		19,018
Pension liability		651		651
Lease liability		824		1,037
Warrant liability		17		76
Total liabilities		271,270		279,586

Commitments and Contingencies

STOCKHOLDERS’ EQUITY

Preferred stock, $0.01 par value; 40,000,000 shares authorized; no shares issued and outstanding		—		—
Preferred stock, $0.01 par value; 2 shares authorized; no shares issued and outstanding at June 30, 2023 and December 31, 2022		—		—
Special stock, $0.01 par value; 1 share authorized, issued and outstanding at June 30, 2023 and December 31, 2022		—		—
Common stock, $0.01 par value; 79,999,997 shares authorized; 44,804,002 and 43,448,384 shares issued at June 30, 2023 and December 31, 2022, respectively; 38,038,305 and 36,907,862 shares outstanding at June 30, 2023 and December 31, 2022, respectively		448		435
Additional paid-in capital		145,114		144,879
Treasury stock (6,765,697 and 6,540,522 shares at June 30, 2023 and December 31, 2022, respectively)		(57,637)		(57,461)
Accumulated other comprehensive loss		(3,389)		(3,626)
Accumulated deficit		(74,042)		(56,886)

Total stockholders’ equity		10,494		27,341

Total liabilities and stockholders’ equity	$	281,764	$	306,927

See Notes to ~~Condensed~~ Consolidated Financial Statements

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TRINITY PLACE HOLDINGS INC.

~~CONDENSED~~ CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (unaudited)

(In thousands, except per share amounts)


	Three Months Ended		Three Months Ended		Six Months Ended		Six Months Ended
	June 30,		June 30,		June 30,		June 30,
	2023		2022		2023		2022

Revenues
Rental revenues	$	1,425	$	1,231	$	2,936	$	2,491
Other income		24		10		144		26
Sales of residential condominium units		5,224		5,118		18,321		11,187

Total revenues		6,673		6,359		21,401		13,704

Operating Expenses
Property operating expenses		811		766		2,078		1,570
Real estate taxes		451		416		914		806
General and administrative		1,835		1,503		3,279		3,005
Pension related costs		143		157		287		315
Cost of sales - residential condominium units		5,169		4,803		17,478		10,524
Transaction related costs		—		—		113		—
Depreciation and amortization		1,003		1,004		2,003		2,007

Total operating expenses		9,412		8,649		26,152		18,227

Operating loss		(2,739)		(2,290)		(4,751)		(4,523)

Equity in net income (loss) from unconsolidated joint ventures		—		70		(4)		816
Equity in net gain on sale of unconsolidated joint venture property		7		4,490		3,065		4,490
Unrealized (loss) gain on warrants		(10)		1,300		56		931
Interest expense, net		(7,194)		(3,295)		(13,522)		(6,064)
Interest expense - amortization of deferred finance costs		(933)		(378)		(1,825)		(814)

Loss before taxes		(10,869)		(103)		(16,981)		(5,164)

Tax expense		(51)		(120)		(175)		(190)

Net loss attributable to common stockholders	$	(10,920)	$	(223)	$	(17,156)	$	(5,354)

Other comprehensive (loss) income:

Unrealized gain on pension liability		118		118		237		237
Comprehensive loss attributable to common stockholders	$	(10,802)	$	(105)	$	(16,919)	$	(5,117)

Loss per share - basic and diluted	$	(0.29)	$	(0.01)	$	(0.45)	$	(0.14)

Weighted average number of common shares - basic and diluted		37,993		37,186		37,800		37,145

Three
Months
Ended
September
30, 2017 Three
Months
Ended
September
30, 2016 Nine
Months
Ended
September
30, 2017 Nine
Months
Ended
September
30, 2016
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues
Rental revenues $ 336 $ 328 $ 1,017 $ 974
Tenant reimbursements 171 208 445 435

Total revenues 507 536 1,462 1,409

Operating Expenses
Property operating expenses 178 144 549 445
Real estate taxes 124 63 345 167
General and administrative 1,509 1,529 4,200 5,272
Transaction related costs 9 49 77 99
Depreciation and amortization 145 121 394 334
Write-off of costs relating to demolished asset 3,426 - 3,426 -

Total operating expenses 5,391 1,906 8,991 6,317

Operating loss (4,884 ) (1,370 ) (7,529 ) (4,908 )

Equity in net loss from unconsolidated joint venture (296 ) - (804 ) -
Interest income (expense), net 20 (12 ) (89 ) 83
Amortization of deferred finance costs (145 ) (39 ) (345 ) (60 )
Reduction of claims liability - (2 ) 1,043 132

Loss before gain on sale of real estate and taxes (5,305 ) (1,423 ) (7,724 ) (4,753 )

Gain on sale of real estate 3,853 - 3,853 -

Tax expense - - (38 ) -

Net loss available to common stockholders $ (1,452 ) $ (1,423 ) $ (3,909 ) $ (4,753 )

Loss per share - basic and diluted $ (0.05 ) $ (0.06 ) $ (0.13 ) $ (0.19 )

Weighted average number of common shares - basic and diluted 31,446 25,483 30,114 25,409

See Notes to Consolidated Financial Statements

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TRINITY PLACE HOLDINGS INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (unaudited)

(In thousands)


FOR THE THREE MONTHS ENDED JUNE 30, 2023

											Accumulated
				Additional							Other
	Common Stock			Paid-In		Treasury Stock			Accumulated		Comprehensive
	Shares	Amount		Capital		Shares	Amount		Deficit		Loss		Total

Balance as of March 31, 2023	43,903	$	439	$	144,980	(6,740)	$	(57,610)	$	(63,122)	$	(3,507)	$	21,180

Net loss attributable to common stockholders	—		—		—	—		—		(10,920)		—		(10,920)
Settlement of warrants	750		8		(5)	—		—		—		—		3
Settlement of stock awards	151		1		—	(26)		(27)		—		—		(26)
Unrealized gain on pension liability	—		—		—	—		—		—		118		118
Stock-based compensation	—		—		139	—		—		—		—		139

Balance as of June 30, 2023	44,804	$	448	$	145,114	(6,766)	$	(57,637)	$	(74,042)	$	(3,389)	$	10,494


FOR THE SIX MONTHS ENDED JUNE 30, 2023

											Accumulated
				Additional							Other
	Common Stock			Paid-In		Treasury Stock			Accumulated		Comprehensive
	Shares	Amount		Capital		Shares	Amount		Deficit		Loss		Total

Balance as of December 31, 2022	43,448	$	435	$	144,879	(6,541)	$	(57,461)	$	(56,886)	$	(3,626)	$	27,341

Net loss attributable to common stockholders	—		—		—	—		—		(17,156)		—		(17,156)
Settlement of warrants	750		8		(5)	—		—		—		—		3
Settlement of stock awards	606		5		—	(225)		(176)		—		—		(171)
Unrealized gain on pension liability	—		—		—	—		—		—		237		237
Stock-based compensation	—		—		240	—		—		—		—		240

Balance as of June 30, 2023	44,804	$	448	$	145,114	(6,766)	$	(57,637)	$	(74,042)	$	(3,389)	$	10,494

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FOR THE THREE MONTHS ENDED JUNE 30, 2022

											Accumulated
				Additional							Other
	Common Stock			Paid-In		Treasury Stock			Accumulated		Comprehensive
	Shares	Amount		Capital		Shares	Amount		Deficit		Loss		Total

Balance as of March 31, 2022	43,388	$	434	$	144,451	(6,551)	$	(57,461)	$	(41,327)	$	(1,224)	$	44,873

Net loss attributable to common stockholders	—		—		—	—		—		(223)		—		(223)
Settlement of stock awards	3		—		—	10		—		—		—		—
Unrealized gain on pension liability	—		—		—	—		—		—		118		118
Stock-based compensation	—		—		129	—		—		—		—		129

Balance as of June 30, 2022	43,391	$	434	$	144,580	(6,541)	$	(57,461)	$	(41,550)	$	(1,106)	$	44,897


FOR THE SIX MONTHS ENDED JUNE 30, 2022

											Accumulated
				Additional							Other
	Common Stock			Paid-In		Treasury Stock			Accumulated		Comprehensive
	Shares	Amount		Capital		Shares	Amount		Deficit		Loss		Total

Balance as of December 31, 2021	43,024	$	430	$	144,282	(6,398)	$	(57,166)	$	(36,196)	$	(1,343)	$	50,007

Net loss attributable to common stockholders	—		—		—	—		—		(5,354)		—		(5,354)
Settlement of stock awards	367		4		—	(143)		(295)		—		—		(291)
Unrealized gain on pension liability	—		—		—	—		—		—		237		237
Stock-based compensation	—		—		298	—		—		—		—		298

Balance as of June 30, 2022	43,391	$	434	$	144,580	(6,541)	$	(57,461)	$	(41,550)	$	(1,106)	$	44,897

See Notes to Consolidated Financial Statements

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TRINITY PLACE HOLDINGS INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

(In thousands)


	For the		For the
	Six Months Ended		Six Months Ended
	June 30,		June 30,
	2023		2022

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss attributable to common stockholders	$	(17,156)	$	(5,354)
Adjustments to reconcile net loss attributable to common stockholders to net cash provided by operating activities:
Depreciation and amortization and amortization of deferred finance costs		3,828		2,821
Other non-cash adjustment - paid-in-kind interest		(231)		—
Stock-based compensation expense		233		271
Gain on sale of joint venture real estate		(3,065)		(4,490)
Deferred rents receivable		(48)		(7)
Other non-cash adjustments - pension expense		237		237
Unrealized gain on warrants		(56)		(931)
Equity in net loss (income) from unconsolidated joint ventures		4		(816)
Distributions from unconsolidated joint ventures		—		1,183
Decrease (increase) in operating assets:
Residential condominium units for sale		10,386		5,676
Receivables		91		34
Prepaid expenses and other assets, net		1,641		(1,041)
Increase in operating liabilities:
Accounts payable and accrued expenses		5,956		2,787
Net cash provided by operating activities		1,820		370

CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to real estate		(43)		(68)
Net proceeds from sale of unconsolidated joint venture		7,240		17,418
Net cash provided by investing activities		7,197		17,350

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from loans and corporate credit facility		3,000		4,666
Proceeds from secured line of credit		2,000		—
Repayment of loans		(14,626)		(27,049)
Repayment of note payable		(5,863)		—
Repayment of secured line of credit		—		(3,500)
Settlement of stock awards		(171)		(291)
Settlement of warrants		3		—
Net cash used in financing activities		(15,657)		(26,174)

NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH		(6,640)		(8,454)
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD		22,055		24,845
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD	$	15,415	$	16,391

CASH AND CASH EQUIVALENTS, BEGINNING PERIOD	$	1,548	$	4,310
RESTRICTED CASH, BEGINNING OF PERIOD		20,507		20,535
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD	$	22,055	$	24,845

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	4,395	$	3,112
RESTRICTED CASH, END OF PERIOD		11,020		13,279
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD	$	15,415	$	16,391

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for: Interest	$	8,870	$	4,970
Cash paid during the period for: Taxes	$	120	$	251

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Capitalized amortization of deferred financing costs and warrants	$	78	$	1,272
Capitalized stock-based compensation expense	$	7	$	27

See Notes to Consolidated Financial Statements

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Trinity Place Holdings Inc.
Notes to Condensed Consolidated Financial Statements

(unaudited~~TRINITY PLACE HOLDINGS INC.~~)
June 30, 2023

~~CONDENSED CONSOLIDATED STATEMENT OF STOCKOLDERS' EQUITY~~

~~(In thousands)~~

Accumulated
Additional Other
Common Stock Paid-In Treasury Stock Accumulated Comprehensive
Shares Amount Capital Shares Amount Deficit Loss Total

Balance as of December 31, 2016 (audited) 30,680 $ 307 $ 87,521 (5,016 ) $ (51,086 ) $ (5,556 ) $ (3,161 ) $ 28,025

Net loss available to common stockholders - - - - - (3,909 ) - (3,909 )
Sale of common stock, net 5,472 55 40,506 - - - - 40,561
Settlement of stock awards 655 6 - (339 ) (2,580 ) - - (2,574 )
Stock-based compensation expense - - 2,248 - - - - 2,248

Balance as of September 30, 2017 (unaudited) 36,807 $ 368 $ 130,275 (5,355 ) $ (53,666 ) $ (9,465 ) $ (3,161 ) $ 64,351

~~See Notes to Condensed Consolidated Financial Statements~~

~~TRINITY PLACE HOLDINGS INC.~~

~~CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS~~

~~(In thousands)~~

Nine Months
Ended
September 30,
2017 Nine Months
Ended
September 30,
2016
(unaudited) (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss available to common stockholders $ (3,909 ) $ (4,753 )
Adjustments to reconcile net loss available to common stockholders to net cash used in operating activities:
Depreciation and amortization 394 334
Amortization of deferred finance costs 345 60
Write-off of costs relating to demolished asset 1,585 -
Stock-based compensation expense 922 1,856
Gain on sale of real estate (3,853 ) -
Deferred rents receivable (34 ) (296 )
Reduction of claims liability - (135 )
Equity in net loss from unconsolidated joint venture 804 -
Distribution of cumulative earnings from unconsolidated joint venture 344 -
(Increase) decrease in operating assets:
Restricted cash, net (731 ) (102 )
Receivables, net 75 (208 )
Prepaid expenses and other assets, net (1,057 ) (81 )
Decrease in operating liabilities:
Accounts payable and accrued expenses (886 ) 450
Pension liabilities (1,069 ) (1,184 )
Obligation to former Majority Shareholder - (6,931 )
Net cash used in operating activities (7,070 ) (10,990 )

CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to real estate (7,080 ) (12,183 )
Investment in unconsolidated joint venture (69 ) -
Net proceeds from the sale of real estate 15,232 -
Restricted cash (8,100 ) (3,444 )
Net cash used in investing activities (17 ) (15,627 )

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from loan, net - 8,651
Deferred finance costs (702 ) -
Settlement of stock awards (2,574 ) (1,967 )
Net proceeds from sale of common stock 40,561 -
Net cash provided by financing activities 37,285 6,684

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 30,198 (19,933 )
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 4,678 38,173
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 34,876 $ 18,240

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ 1,810 $ 1,526
Taxes $ 37 $ 38

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Adjustment of liability related to stock-based compensation $ - $ (5,140 )
Adjustment to accumulated deficit for capitalized stock-based compensation expense $ - $ (541 )
Accrued development costs included in accounts payable and accrued expenses $ 2,943 $ (1,149 )
Capitalized amortization of deferred financing costs $ 178 $ 258
Capitalized stock-based compensation expense $ 1,326 $ 4,077

~~See Notes to Condensed Consolidated Financial Statements~~

~~Trinity Place Holdings Inc.~~

~~Notes to Condensed Consolidated Financial Statements (Unaudited)~~

~~September 30, 2017~~

Note 1 – Business

Overview

Trinity Place Holdings Inc. ~~(“Trinity,~~, which we refer to in these financial statements as “Trinity,” ~~“we”, “our”,~~“we,” “our,” or ~~“us”)~~“us,” is a real estate holding, investment, development and asset management company. ~~Our business is primarily to acquire, invest in, own, manage, develop or redevelop and sell real estate assets and/or real estate related securities.~~ Our largest asset is a property located at 77 Greenwich Street in Lower Manhattan (“77 Greenwich”) ~~in Lower Manhattan. 77 Greenwich~~, which is ~~a vacant building that was demolished and is under development~~substantially complete as a mixed-use project consisting of a 90-unit residential condominium tower, ~~that also includes plans for~~ retail space and a New York City elementary school. We also own a ~~retail strip center~~105-unit, 12-story multi-family property located at 237 11^th Street in ~~West Palm Beach, Florida,~~Brooklyn, New York (“237 11^th”), as well as a property ~~formerly~~ occupied by a retail tenant in Paramus, New Jersey, and, through a joint venture, a 50% interest in a newly constructed 95-unit multi-family property, known as The Berkley, located in Brooklyn, New York. We continue to evaluate new investment opportunities.

Jersey.

We also control a variety of intellectual property assets focused on the consumer sector, ~~including~~a legacy of our ~~on-line marketplace at~~predecessor, Syms Corp. (“Syms”), including FilenesBasement.com, our rights to the Stanley Blacker® brand, as well as the intellectual property associated with the Running of the Brides® event and An Educated Consumer is Our Best Customer® slogan. WeIn addition, we also had approximately ~~$230.3~~$293.4 million of federal net operating loss carryforwards (“NOLs”) at ~~September~~June 30, ~~2017.~~2023, which can be used to reduce our future taxable income and capital gains.

Liquidity and Going Concern; Management’s Plans; Recent Developments

~~Trinity is the successor to Syms Corp. (“Syms”), which also owned Filene’s Basement. Syms and its subsidiaries filed for relief under~~Our financial statements are prepared using accounting principles generally accepted in the United States ~~Bankruptcy Code~~of America applicable to a going concern, which contemplate the realization of assets and liquidation of liabilities in ~~2011.~~the normal course of business. The COVID-19 pandemic and related matters, including government actions, shifts in residential consumer sentiment and changes to the broader and local economies, had a significant adverse impact on our business. More recently, the economic downturn, increased interest rates, high inflation and current financial market challenges have also impacted our business. As of June 30, 2023, we had total cash and restricted cash of $15.4 million, of which approximately $4.4 million was cash and cash equivalents and approximately $11.0 million was restricted cash. The Company’s cash and cash equivalents will not be sufficient to fund the Company’s operations, debt service, amortization and maturities and corporate expenses over the next 12 months, unless we are able to extend or refinance our maturing debt and raise additional capital, creating substantial doubt about our ability to continue as a going concern. Management is exploring opportunities to secure additional funding through the sale of assets, refinancings of outstanding indebtedness, and equity or debt financings or other sources. The Company also continues to explore a range of strategic and financing alternatives. Potential strategic alternatives that are being evaluated include securing an equity and/or debt financing of the Company, refinancing of existing debt, and/or a sale or merger or reverse merger of the Company. In ~~September 2012,~~April 2023, the ~~Syms Plan~~Company reached an agreement with its CCF lender regarding, among other things, the deferment of ~~Reorganization (the “Plan”) became~~cash interest payments and a $7 million prepayment until August 31, 2023, subject to extension in certain circumstances, which also provided that the Company will enter into a strategic transaction that results in the repayment of the CCF or prepay the CCF by $5 million from equity proceeds by such date. In addition, effective in April 2023, the Company’s subsidiary borrower under the secured line of credit entered into an amendment to that agreement extending the maturity date to March 22, 2024 and ~~Syms~~reducing the interest rate to 2.5% until such date. In July 2023, the Company exercised its first extension option for the 237 11^th Loans (as defined below) which extended the maturity date of the debt to July 2024. Given the current financial market challenges and ~~its subsidiaries consummated their reorganization under Chapter 11 through~~ a ~~series of~~slowdown in lending and other transactions, ~~contemplated~~there can be no assurance that we will be able to enter into a strategic transaction or prepay the CCF by the ~~Plan~~agreed-upon date, or that our cash position will extend through that date or that we will be able to enter into any future extensions, amendments or waivers with these or other lenders, raise additional capital, refinance indebtedness or enter into other financing arrangements or engage in asset sales or strategic partnerships sufficient to fund our cash needs, on terms satisfactory to us, if at all. We are also evaluating additional alternatives in restructuring our business and ~~emerged~~our capital structure, including but not limited to filing for bankruptcy protection or seeking an out-of-court restructuring of our liabilities.

Table of Contents

contracts for our residential condominium units, including seven units since December 31, 2022, for a total of 35 units as of June 30, 2023. In addition, we closed on two residential condominium units between July 1, 2023 and August 14, 2023.

The financial statements do not include any adjustments that might result from ~~bankruptcy. As part~~the outcome of ~~those transactions, reorganized Syms merged with and into Trinity, with Trinity~~any uncertainty as ~~the surviving corporation and successor issuer pursuant~~ to ~~Rule 12g-3 under the Exchange Act. On or about March 8, 2016,~~our ability to continue as a General Unsecured Claim Satisfaction occurred under the Plan. On March 14, 2016, we made the final Majority Shareholder payment (as defined in the Plan) to the former Majority Shareholder in the amount of approximately $6.9 million. Together these satisfied our remaining payment and reserve obligations under the Plan. going concern.

Note 2 – Summary of Significant Accounting Policies

Basis of Presentation

The accompanying ~~condensed~~unaudited consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include our financial statements and the financial statements of our wholly-owned subsidiaries.

The accompanying unaudited ~~condensed~~ consolidated interim financial information ~~has been prepared according to~~also conform with the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted in accordance with such rules and regulations. ~~Our management~~Management believes that the disclosures presented in these unaudited ~~condensed~~ consolidated financial statements are adequate to make the information presented not misleading. In management’s opinion, all adjustments and eliminations, consisting only of normal recurring adjustments, necessary to present fairly the financial position and results of operations for the reported periods have been included. The results of operations for such interim periods are not necessarily indicative of the results for the full year. The accompanying unaudited ~~condensed~~ consolidated interim financial information should be read in conjunction with our December 31, ~~2016~~2022 audited consolidated financial statements ~~as previously~~ filed ~~with the SEC in our 2016 Annual Report~~ on Form 10-K (the ~~“2016~~“2022 Annual Report”).

a. Principles of Consolidation - The consolidated financial statements include our accounts and those of our subsidiaries which are or were wholly-owned or controlled by us. Entities which we do not control through our voting interest and entities which are variable interest entities, but where we are not the primary beneficiary, are accounted for under the equity method. Accordingly, our share of the earnings or losses of our unconsolidated joint ventures, The Berkley, which was sold in April 2022, and 250 North 10^th, which was sold in February 2023, are included in our consolidated statements of operations and ~~other public information.~~

~~Principles of Consolidation -~~ The condensed consolidated financial statements include our accounts and those of our subsidiaries which are wholly-owned or controlled by us. Entities which we do not control through our voting interest and entities which are variable interest entities, but where we are not the primary beneficiary, are accounted for under the equity method. Accordingly, our share of the earnings (losses) of these unconsolidated joint ventures is included in our condensed consolidated statements of operations.comprehensive loss (see Note 13 – Investments in Unconsolidated Joint Ventures for further information). All significant intercompany balances and transactions have been eliminated.

We are required to consolidate a variable interest entity (the “VIE”) in which we are considered the primary beneficiary. The primary beneficiary is the entity that has (i) the power to direct the activities that most significantly impact the ~~entity's~~entity’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE. As of ~~September~~June 30, ~~2017,~~2023, we had no VIEs.

We assess the accounting treatment for joint venture investments. This assessment includes a review of the joint venture or limited liability company agreement to determine which party has what rights and whether those rights are protective or participating. For potential VIEs, we review such agreements in order to determine which party has the power to direct the activities that most significantly impact the entity's economic performance. In situations where we and our partner approve, among other things, the annual budget, receive a detailed monthly reporting package, meet on a quarterly basis to review the results of the joint venture, review and approve the joint venture's tax return before filing, and approve all leases that cover more than a nominal amount of space relative to the total rentable space at each property, we do not consolidate the joint venture as we consider these to be substantive participation rights that result in shared power of the activities that most significantly impact the performance of the joint venture. Our joint venture agreements may contain certain protective rights such as requiring partner approval to sell, finance or refinance the property and the payment of capital expenditures and operating expenditures outside of the approved budget or operating plan.

~~Investment~~Investments in Unconsolidated Joint ~~Venture~~Ventures -We ~~account~~accounted for our ~~investment~~investments in ~~our~~ unconsolidated joint ~~venture~~ventures, namely, The Berkley, which was sold in April 2022, and 250 North 10^th, which was sold in February 2023, under the equity method of accounting (see Note 1213 - ~~Investment~~Investments in ~~Our~~ Unconsolidated Joint ~~Venture). We also assess our investment in unconsolidated joint venture~~Ventures for recoverability, and if it is determined that a loss in value of the investment is other than temporary, we write down the investment to its fair value. We evaluate our equity investment for impairment based on the joint ventures' projected cash flows. We do not believe that the value of our equity investment was impaired at September 30, 2017 or December 31, 2016.further information).

c. Use of Estimates - The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Accordingly, actual results could differ from those estimates (see Note 2g. Residential Condominiums for Sale for further discussion).

d. Reportable Segments - We operate in one reportable segment, commercial real estate.

e. Concentrations of Credit Risk - Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents. We hold substantially all of our cash and cash equivalents in banks. Such cash balances at times exceed federally insured limits.

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f. Real Estate - Real estate assets are stated at historical cost, less accumulated depreciation and amortization. All costs related to the improvement or replacement of real estate properties are capitalized. Additions, renovations and improvements that enhance and/or extend the useful life of a property are also capitalized. Expenditures for ordinary maintenance, repairs and improvements that do not materially prolong the useful life of an asset are charged to operations as incurred. Depreciation and amortization are determined using the straight-line method over the estimated useful lives as described in the table below:

~~Use of Estimates~~ - The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Accordingly, actual results could differ from those estimates.

~~Reportable Segments~~ ~~- We operate in one reportable segment, commercial real estate.~~

~~Concentrations of Credit Risk~~ - Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents. We hold substantially all of our cash and cash equivalents in banks. Such cash balances at times exceed federally-insured limits. We have not experienced any losses in such accounts.

~~Real Estate~~ - Real estate assets are stated at historical cost, less accumulated depreciation and amortization. All costs related to the improvement or replacement of real estate properties are capitalized. Additions, renovations and improvements that enhance and/or extend the useful life of a property are also capitalized. Expenditures for ordinary maintenance, repairs and improvements that do not materially prolong the normal useful life of an asset are charged to operations as incurred. Depreciation and amortization are determined using the straight-line method over the estimated useful lives described in the table below:

~~Category~~		~~Terms~~
Category		Terms
Buildings and improvements		10 - 39 years
Tenant improvements		Shorter of remaining term of the lease or useful life
Furniture and fixtures		5 - 8 years

~~Real Estate Under Development~~Residential Condominium Units for Sale - We capitalize certain costs related to the development and redevelopment of real estate including initial project acquisition costs, pre-construction costs and construction costs for each specific property. Additionally, we capitalize operating costs, interest, real estate taxes, insurance and compensation and related costs of personnel directly involved with the specific project related to real estate that is under development. Capitalization of these costs begin when the activities and related expenditures commence, and cease ~~when~~as the ~~property is held available for~~condominium units receives its temporary certificates of occupancy upon substantial completion of tenant improvements, but no later than one year from the completion of major construction activity at which time the project is placed in service and depreciation commences. Revenue earned under short-term license agreements at properties under development is offset against these capitalized costs.(“TCOs”).

77 Greenwich is a condominium development project which includes residential condominium units that are ready for sale. Residential condominium units for sale as of June 30, 2023 and December 31, 2022 includes 77 Greenwich, and in all cases, excludes costs of development for the residential condominium units at 77 Greenwich that were sold. The residential condominium units for sale are stated at the lower of cost or net realizable value. Management considers relevant cash flows relating to budgeted project costs and estimated costs to complete, estimated sales velocity, expected proceeds from the sales of completed condominium units, including any potential declines in market values, and other available information in assessing whether the 77 Greenwich development project is impaired. Residential condominium units are evaluated for impairment based on the contracted and projected sales prices compared to the total estimated cost to construct. Any calculated impairments are recorded immediately in cost of sales. No provision for impairment was recorded for our unsold residential condominium units during the six months ended June 30, 2023 or 2022, respectively.

Valuation of Long-Lived Assets - We periodically review long-lived assets for impairment whenever changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. We consider relevant cash flow, management’s strategic plans and significant decreases, if any, in the market value of the asset and other available information in assessing whether the carrying value of the assets can be recovered. When such events occur, we compare the carrying amount of the asset to the undiscounted expected future cash flows, excluding interest charges, from the use and eventual disposition of the asset. If this comparison indicates an impairment, the carrying amount would then be compared to the estimated fair value of the long-lived asset. An impairment loss would be measured as the amount by which the carrying value of the long-lived asset exceeds its estimated fair value. NoWe considered all the aforementioned indicators of impairment for our real estate for the six months ended June 30, 2023 and 2022, respectively, and no provision for impairment was recorded during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 or ~~September 30, 2016.~~2022, respectively.

~~Trademarks and Customer Lists~~ ~~- Trademarks and customer lists are stated at cost, less accumulated amortization. Amortization is determined using the straight-line method over useful lives of 10 years.~~

Fair Value Measurements - We determine fair value in accordance with Accounting Standards Codification (“ASC”) ~~820-10-05~~820, “Fair Value Measurement,” for financial assets and liabilities. This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures.

Fair value is defined as the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These valuation techniques involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market and the instruments’ complexity.

Assets and liabilities disclosed at fair value are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels, which are defined by ASC 820-10-35, are directly related to the amount of subjectivity associated with the inputs to the fair valuation of these assets and liabilities. Determining which category an asset

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or liability falls within the hierarchy requires significant judgment and we evaluate our hierarchy disclosures each quarter.

Level 1 - Valuations based on quoted prices for identical assets and liabilities in active markets.

Level 2 - Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

Level 3 - Valuations based on unobservable inputs reflecting management’s own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment.

j. Cash and Cash Equivalents - Cash and cash equivalents include securities with original maturities of three months or less when purchased.

k. Restricted Cash - Restricted cash represents amounts required to be restricted under our loan agreements, letter of credit (see Note 6 - Loans Payable and Secured Line of Credit for further information), deposits on residential condominium sales at 77 Greenwich, condominium sales proceeds that have not yet been transferred to the lender and tenant related security deposits.

~~Cash and Cash Equivalents~~ ~~- Cash and cash equivalents include securities with original maturities of three months or less when purchased.~~

~~Restricted Cash -~~ Restricted cash represents amounts required to be restricted under our loan agreements and secured line of credit (see Note 5 - Loans Payable and Secured Line of Credit), tenant related security deposits and deposits on property acquisitions.

Revenue Recognition - Leases with tenants are accounted for as operating leases. Minimum rents are recognized on a straight-line basis over the term of the respective ~~leases,~~lease, beginning when the tenant takes possession of the space. The excess of rents recognized over amounts contractually due pursuant to the underlying leases are included in deferred rents receivable. In addition, retail leases typically provide for the reimbursement of real estate taxes, insurance and other property operating expenses. ~~These~~As lessor, when reporting revenue, we have elected to combine the lease and non-lease components of our operating lease agreements and account for the components as a single lease component in accordance with ASC Topic 842. Lease revenues and reimbursement of real estate taxes, insurance and other property operating expenses are presented in the consolidated statements of operations and comprehensive loss as “rental revenues.” Also, these reimbursements of expenses are recognized aswithin revenue in the period the expenses are incurred. We ~~make estimates of~~assess the collectability of our accounts receivable related to tenant revenues. ~~An allowance for doubtful accounts has been~~We applied the guidance under ASC 842 in assessing our lease payments: if collection of rents under specific operating leases is not probable, then we recognize the lesser of that lease’s rental income on a straight-line basis or cash received, plus variable rents as earned. Once this assessment is completed, we apply a general reserve, as provided ~~against certain tenant accounts receivable that are estimated to be uncollectible. Once the amount is ultimately deemed to be uncollectible, it is written off.~~under ASC 450-20, if applicable.

Revenues on sale of residential condominiums reflects the gross sales price from sales of residential condominium units which are recognized at the time of the closing of a sale, when title to and possession of the units are transferred to the buyer. Our performance obligation, to deliver the agreed-upon condominium, is generally satisfied in less than one year from the original contract date. Cash proceeds from unit closings held in escrow for our benefit are included in restricted cash in the consolidated balance sheets. Customer cash deposits on residential condominiums that are in contract are recorded as restricted cash and the related liability is recorded in accounts payable and accrued expenses in our consolidated balance sheets.Our cost of sales consists of allocated expenses related to the initial acquisition, demolition, construction and development of the condominium complex, including associated building costs, development fees, as well as salaries, benefits, bonuses and share-based compensation expense, including other directly associated overhead costs, in addition to qualifying interest and financing costs. See also Note 2g. Residential Condominium Units for Sale.

Stock-Based Compensation – We have granted stock-based compensation, which is described below in Note 1112 – Stock-Based Compensation. We account for stock-based compensation in accordance with ASC 718-30-30, which establishes accounting for stock-based awards exchanged for employee services. Under the provisions of ASC 718-10-35, stock-basedStock-based compensation cost is measured at the grant date, based on the fair value of the award on that date, and is expensed at the grant date (for the portion that vests immediately) or ratably over the ~~respective~~related vesting periods. Shares that are forfeited are added back into the pool of shares available under the Stock Incentive Plan (see Note 12 – Stock-Based Compensation), and any recorded expense related to forfeited shares are reversed in the year of forfeiture.

Income Taxes - We account for income taxes under the asset and liability method as required by the provisions of ASC ~~740-10-30,~~740, “Income ~~Taxes”.~~Taxes.” Under this method, deferred tax assets and liabilities are determined based on

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differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. We provide a valuation allowance for deferred tax assets for which we do not consider realization of such assets to be more likely than not.

ASC 740-10-65 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740-10-65, we may recognize the 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 the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. ASC 740-10-65 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and ~~requires~~ increased other disclosures. As of both ~~September~~June 30, ~~2017~~2023 and December 31, ~~2016,~~2022, we had determined that no liabilities are required in connection with unrecognized tax positions. As of ~~September~~June 30, ~~2017,~~2023, our tax returns for the ~~prior three~~ years ended December 31, 2019 through December 31, 2022 are subject to review by the Internal Revenue Service.

Our state returns are open to examination for the years December 31, 2018 through December 31, 2022, depending on the jurisdiction.

We are subject to certain federal, state and local income and franchise taxes.

o. Earnings (loss) Per Share - We present both basic and diluted earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock, where such exercise or conversion would result in a lower per share amount. 6,429,000 warrants exercisable at $4.31 per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock, where such exercise or conversion would result in a lower per share amount. Shares issuable under restricted stock units that have vested but not yet settled were excluded ~~from the computation of diluted earnings (loss) per share because the awards would have been antidilutive for the periods presented.~~

~~Deferred Finance Costs~~ – Deferred finance costs represent commitment fees, legal, title and other third party costs associated with obtaining commitments for mortgage financing which result in a closing of such financing. These costs are being offset against loans payable in the condensed consolidated balance sheets for mortgage financings and are included in other assets for our secured line of credit. These costs are amortized over the terms of the related financing arrangements. Unamortized deferred finance costs are expensed when the associated debt is refinanced or repaid before maturity. Costs incurred in seeking financing transactions which do not close are expensed in the period in which it is determined that the financing will not close.

~~Deferred Lease Costs~~ ~~– Deferred lease costs consist of fees and direct costs incurred to initiate and renew operating leases and are amortized on a straight-line basis over the related lease term.~~

~~Underwriting Commissions and Costs~~ ~~– Underwriting commissions and costs incurred in connection with our stock offerings are reflected as a reduction of additional paid-in-capital.~~

~~Reclassifications -~~ ~~Certain prior year financial statement amounts have been reclassified to conform to the current year presentation.~~

~~Recent Accounting Pronouncements~~

~~In February 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-05, Other Income-Gains and Losses~~ from the ~~De-recognition~~computation of ~~Nonfinancial Assets (Subtopic 610-20)~~diluted earnings (loss) per share because the awards would have been antidilutive for the three and six months ended June 30, 2023 and 2022. Shares issuable at June 30, 2023 comprising 52,015 restricted stock units that have vested but not yet settled were excluded from the computation of diluted loss per share because the awards would have been antidilutive for the three and six months ended June 30, 2023. Shares issuable at June 30, 2022 comprising 228,060 restricted stock units that had vested but not yet settled were excluded from the computation of diluted loss per share because the awards would have been antidilutive for the three and six months ended June 30, 2022.

p. Deferred Finance Costs – Capitalized and deferred finance costs represent commitment fees, legal, title and other third party costs associated with obtaining commitments for mortgage financings which result in a closing of such financing. These costs are being offset against loans payable in the consolidated balance sheets for mortgage financings and had an unamortized balance of $682,000 and $2.1 million at June 30, 2023 and December 31, 2022, respectively. Costs for our corporate credit facility are being offset against corporate credit facility, net, in the consolidated balance sheets and had an unamortized balance of $828,000 and $1.3 million at June 30, 2023 and December 31, 2022, respectively. Unamortized deferred finance costs are expensed when the associated debt is refinanced with a new lender or repaid before maturity. Costs incurred in seeking financing transactions which do not close are expensed in the period in which it is determined that the financing will not close.

q. Deferred Lease Costs – Deferred lease costs consist of fees and incremental costs incurred to ~~add guidance for partial sales of nonfinancial assets, including partial sales of real estate. Historically, U.S. GAAP contained several different accounting models~~initiate and renew retail operating leases and are amortized to ~~evaluate whether~~depreciation and amortization on a straight-line basis over the ~~transfer of certain assets qualified for sale treatment. ASU 2017-05 reduces~~related non-cancelable lease term. Lease costs incurred under our residential leases are expensed as incurred.

Any references to square footage, property count or occupancy percentages, and any amounts derived from these values in these notes to the number of potential accounting models that might apply and clarifies which model does apply in various circumstances. ASU 2017-05 is effective for annual reporting periods after December 16, 2017, including interim reporting period within that reporting period. The adoption of ASU 2017-05 is not expected to have a material impact on ourcondensed consolidated financial ~~statements.~~

In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The guidance clarifies the definition of a business and provides guidance to assist with determining whether transactions should be accounted for as acquisitions of assets or businesses. The main provision is that an acquiree is not a business if substantially all of the fair value of the gross assets is concentrated in a single identifiable asset or group of assets. Upon the adoption of ASU No. 2017-01, we evaluate each acquisition of real estate or in-substance real estate to determine if the integrated set of assets and activities acquired meet the definition of a business and need to be accounted as a business combination. If either of the following criteria is met, the integrated set of assets and activities acquired would not qualify as a business:

~~Substantially all of the fair value of the gross assets acquired is concentrated in either a single identifiable asset or a group of similar identifiable assets; or~~

The integrated set of assets and activities is lacking, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs (i.e. revenue generated before and after the transaction).

~~An acquired process is considered substantive if:~~

The process includes an organized workforce (or includes an acquired contract that provides access to an organized workforce) that is skilled, knowledgeable, and experienced in performing the process;

~~The process cannot be replaced without significant cost, effort, or delay; or~~

~~The process is considered unique or scarce.~~

Generally, we expect that acquisitions of real estate or in-substance 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 February 2016, the FASB issued ASU No. 2016-02, Leases. ASU 2016-02 outlines a new model for accounting by lessees, whereby their rights and obligations under substantially all leases, existing and new, would be capitalized and recorded on the balance sheet. For lessors, however, the accounting remains largely unchanged from the current model, with the distinction between operating and financing leases retained, but updated to align with certain changes to the lessee model and the new revenue recognition standard discussed above. As lessee, westatements, are party to various office leases with future payment obligations aggregating $3.2 million at September 30, 2017 (see Note 8 - Commitments) for which we expect to record right of use assets upon adoption of ASU 2016-02. The new guidance also requires that internal leasing costs be expensed as incurred, as opposed to capitalized and deferred. We do not capitalize internal leasing costs. ASU 2016-02 will also require extensive quantitative and qualitative disclosures and is effective beginning after December 15, 2018, but early adoption is permitted.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers. ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. ASU 2014-09 does not apply to our lease revenues, but will apply to reimbursed tenant costs. Additionally, this guidance modifies disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB issued ASU 2015-14, which defers the effective date of ASU 2014-09 for all entities by one year, until years beginning in 2018, with early adoption permitted but not before 2017. Entities may adopt ASU 2014-09 using either a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients or a retrospective approach with the cumulative effect recognized at the date of adoption. Management believes the majority of our revenue falls outside of the scope of ~~this guidance~~our independent registered public accounting firm’s review.

Note 3 – Residential Condominium Units for Sale

Residential condominium units for sale as of June 30, 2023 and ~~does not anticipate any significant changes to~~December 31, 2022 includes 77 Greenwich, and in all cases, excludes costs of development for the ~~timing~~residential condominium units at 77 Greenwich that were sold. Closings on

Table of ~~our revenue recognition. We intend to implement the standard retrospectively~~Contents

residential condominium units started in September 2021 with ~~the cumulative effect recognized in retained earnings at the date of application.~~35 closings having occurred through June 30, 2023, and we have closed on two additional units since June 30, 2023.

Note 34 – Real Estate, Net

As of ~~September~~June 30, ~~2017~~2023 and December 31, ~~2016,~~2022, real estate, net, includes the following ~~(in~~(dollars in thousands):

September 30,
2017 December 31,
2016
(unaudited) (audited)

Real estate under development 52,249 $ 53,712
Buildings and building improvements 5,817 5,794
Tenant improvements 571 569
Land 2,452 2,452
61,089 62,527
Less: accumulated depreciation 2,327 2,143
$ 58,762 $ 60,384


	June 30,		December 31,
	2023		2022


Building and building improvements	$	51,141	$	51,141
Tenant improvements		221		221
Furniture and fixtures		890		847
Land and land improvements		28,847		28,847
		81,099		81,056
Less: accumulated depreciation		17,787		16,405
	$	63,312	$	64,651

Real estate under development as of September 30, 2017 consists of the 77 Greenwich and Paramus, New Jersey properties while real estate under development as of December 31, 2016 consists of the 77 Greenwich, Paramus, New Jersey and Westbury, New York properties. BuildingsBuilding and building improvements, tenant improvements, furniture and fixtures, and land ~~at both dates consist~~and land improvements included the 237 11^th property and the Paramus, New Jersey property as of ~~the West Palm Beach, Florida property.~~

~~On August 4, 2017, we closed on the sale of our property located in Westbury, New York for a gross sale price of $16.0 million. The sale resulted in a gain of $3.9 million~~June 30, 2023 and ~~generated approximately $15.2 million in net proceeds to us.~~

December 31, 2022. Depreciation expense amounted to approximately ~~$61,000~~$692,000 and ~~$57,000~~$696,000 for the three months ended ~~September~~June 30, ~~2017~~2023 and ~~September 30, 2016,~~2022, respectively, and ~~$184,000 and $145,000~~approximately $1.4 million for each of the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 and ~~September 30, 2016,~~2022, respectively. ~~The increase in depreciation expense for~~

In May 2018, we closed on the ~~three and nine months ended September 30, 2017 related to the West Palm Beach, Florida property.~~

~~Write-off~~acquisition of costs relating to demolished asset was approximately $3.4 million. This is related to the 77 Greenwich property’s acceleration of depreciation of the building and building improvements and demolition costs at 77 Greenwich due to the completion of demolition of the 57,000 square foot six-story commercial building.

~~On September 8, 2017,~~237 11^th, a ~~wholly-owned subsidiary of ours entered into an agreement pursuant to which it acquired an option to purchase a newly built~~ 105-unit, ~~12 story~~12-story multi-family apartment building located at 237 ~~11th~~ 11^thStreet, Brooklyn, New York for a purchase price of ~~$81.0~~$81.2 million, excluding transaction costs of approximately $0.7 million. ~~Under~~Due to water damage in apartment units and other property at 237 11^th resulting from construction defects, we submitted a notice of claim to our insurance carrier for property damage and business interruption (lost revenue) in September 2018. The insurance carrier subsequently disclaimed coverage for the losses and we filed a complaint against the carrier alleging that it breached the insurance policy by denying coverage. We also filed legal claims against the seller, its parent company, and the general contractor to recover damages arising from the defective construction of the building, including defects that resulted in water damage as well as other defects. In addition, the general contractor impleaded into that litigation several subcontractors who performed work on the property. Management expects to recover some portion of the cost incurred to repair the property through the litigations and/or settlement negotiations with the seller, its parent company, the general contractor, the subcontractors, and the insurance carrier, although the amount of damages that may be recoverable in litigation and/or potential settlement negotiations are uncertain at this time, as is the timing of receipt of any such payments, which has been impacted by the COVID-19 pandemic, including the resulting backlog in the court system and slowdown in judicial proceedings. We have, from time to time, engaged in mediation with the seller, its parent company, the general contractor, and the third-party defendants impleaded by the general contractor to explore the possibility of settling the case involving those parties, but to date, we have not reached an agreement, and we continue to pursue all legal remedies. We incurred significant cash outflows for costs associated with these repairs and remediation, which commenced in September 2019 and was completed as of December 31, 2021. As of June 30, 2023, the property was 98.1% leased.

As of June 30, 2023 and December 31, 2022, intangible assets, net, consisted of the real estate tax abatement at its original valuation of $11.1 million offset by its related accumulated amortization of approximately $3.8 million and $3.4 million at June 30, 2023 and December 31, 2022, respectively. Amortization expense amounted to $185,000 for each of the three months ended June 30, 2023 and 2022, respectively, and $370,000 for each of the six months ended June 30, 2023 and 2022, respectively.

77 Greenwich and the New York City School Construction Authority

We entered into an agreement with the New York City School Construction Authority (the “SCA”), whereby we constructed a school sold to the SCA as part of our condominium development at 77 Greenwich. Pursuant to the agreement, wethe SCA agreed to pay us $41.5 million for the purchase of their condominium unit and reimburse us for the costs

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associated with constructing the school, including a construction supervision fee of approximately $5.0 million. Payments for construction are ~~entitled~~being made by the SCA to ~~exercise~~ the ~~option during~~general contractor in installments as construction on their condominium unit progresses. Payments to us for the ~~period commencing on February 1,~~land and construction supervision fee commenced in January 2018 and ~~expiring~~continued through October 2019 for the land and will continue through completion of the SCA buildout for the construction supervision fee, with an aggregate of $46.3 million having been paid to us as of June 30, 2023 from the SCA, with approximately $208,000 remaining to be paid. We have also received an aggregate of $55.4 million in reimbursable construction costs from the SCA through June 30, 2023. In April 2020, the SCA closed on ~~February 28, 2018. We paid an initial deposit~~the purchase of ~~$8.1 million,~~the school condominium unit from us, at which point title transferred to the SCA, and the SCA has completed the buildout of the interior space, which is ~~included~~a public elementary school with approximately 476 seats. The school received its final TCO and opened to students in ~~restricted cash on~~September 2022. We have also guaranteed certain obligations with respect to the ~~condensed consolidated balance sheet, upon entering into~~construction of the agreement, which is nonrefundable if we do not exercise the option. The purchase price will be funded through acquisition financing and cash on hand. The acquisition of this property, which is subject to customary closing conditions, is expected to close in the first quarter of 2018.school.

Note 45 – Prepaid Expenses and Other Assets, Net

As of ~~September~~June 30, ~~2017~~2023 and December 31, ~~2016,~~2022, prepaid expenses and other assets, net, include the following ~~(in~~(dollars in thousands):

September 30,
2017 December 31,
2016
(unaudited) (audited)

Trademarks and customer lists $ 2,090 $ 2,090
Prepaid expenses 1,124 867
Lease commissions 461 433
Other 1,189 417
4,864 3,807
Less: accumulated amortization 2,094 1,658
$ 2,770 $ 2,149


	June 30,		December 31,
	2023		2022


Prepaid expenses	$	861	$	2,494
Deferred finance costs warrants		2,184		2,184
Other		1,058		1,066
		4,103		5,744
Less: accumulated amortization		2,221		1,970
	$	1,882	$	3,774

Note 56 – Loans Payable and Secured Line of Credit

Corporate Credit Facility

~~Mortgages~~In December 2019, we entered into a multiple draw credit agreement aggregating $70.0 million (the “Corporate Credit Facility,” or “CCF”), which may be increased by $25.0 million subject to satisfaction of certain conditions and the consent of the lender (the “CCF Lender”). Draws under the Corporate Credit Facility were allowed during the 32-month period following the closing date of the Corporate Credit Facility (the “Closing Date”). The CCF matures on December 19, 2024, subject to extensions until December 19, 2025 and June 19, 2026, respectively, under certain circumstances. The CCF provided for the proceeds of the CCF to be used for investments in certain multi-family apartment buildings in the greater New York City area and certain non-residential real estate investments approved by the CCF Lender in its reasonable discretion, as well as in connection with certain property recapitalizations and in specified amounts for general corporate purposes and working capital.

In connection with the December 2020 transaction noted below, the Company entered into an amendment to the CCF, pursuant to which, among other things, (i) we were permitted to enter into the Mezzanine Loan Agreement (as defined below) and related documents, (ii) the commitment made by the CCF Lender under the CCF was reduced by the $7.5 million, and (iii) the MOIC amount was amended to combine the CCF and the Mezzanine Loan. In addition, the exercise price of the warrants issued in connection with the CCF was amended from $6.50 per share to $4.31 per share (the “Warrant Agreement Amendment”) (see Note 11 – Stockholders Equity – Warrants to our consolidated financial statements for further discussion regarding the warrants).

In connection with the closing of the 77 Mortgage Loan and amendment to the Mezzanine Loan described below, we entered into amendments, dated as of October 22, 2021 and November 10, 2021, to our CCF pursuant to which, among other things, the parties agreed that (a) no additional funds will be drawn under the CCF, (b) the minimum liquidity requirement was made consistent with the 77 Mortgage Loan Agreement until May 1, 2023, (c) the Company will prepay the outstanding principal balance of the CCF in an amount no less than $7.0 million on or prior to May 1, 2023 and (d) the multiple on invested capital (the “MOIC”) provisions were revised to provide that (i) the MOIC amount due upon final repayment of the CCF was amended to be consistent with the Mezzanine Loan such that if no event of default exists and

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is continuing under the CCF at any time prior to June 22, 2023, the amount due will be combined with the Mezzanine Loan, to the extent not previously paid, if any, and (ii) the amount of the CCF used to calculate the MOIC was reduced to $35.75 million. We entered into an amendment in November 2022, which eliminated the minimum liquidity requirement.

In April 2023, the Company amended the CCF to provide that cash interest payments and the $7.0 million prepayment due May 1, 2023 will be deferred until August 31, 2023 (the “Restricted Period”). If the Company has an executed commitment for a financing, sale transaction or other strategic transaction which results in the repayment in full of the obligations under the CCF (a “Strategic Transaction”), the Restricted Period will be extended automatically for 30 days and may be further extended for an additional 30 days upon the approval of the CCF Lender, not to be unreasonably withheld. The CCF Amendment also provides, among other things, that (i) the Company shall either enter into a Strategic Transaction that results in the repayment of the CCF or prepay the CCF by $5.0 million from equity proceeds on or prior to the end of the Restricted Period; (ii) the Company shall provide certain additional periodic financial reporting; and (iii) the ability of the Company to make certain previously permitted investments and other payments is suspended until the end of the Restricted Period. In June 2023, we further amended the CCF, which amendment provided, among other things, that (i) the CCF would be increased by up to $5,000,000, with $3,000,000 to be used for general corporate purposes and certain other items if applicable, and up to $2,000,000 to be used in connection with the extension of the loans in respect of 237 11th, including the purchase of an interest rate cap, (ii) the interest rate of the CCF was increased by 0.20%, and (iii) certain covenants and other terms of the CCF were revised, including that a refinancing of 237 11^th (excluding the extension of the existing loans) and/or the property in Paramus, New Jersey requires the prior written consent of the CCF Lender; the Company was required to meet with the CCF Lender to review the results of the Company’s strategic process, endeavor in good faith to establish mutually acceptable next steps, and provide copies of written term sheets received from participants in the strategic process, including at least one that addresses repayment or purchase of the CCF; and the removal of the ability of the Company to incur certain types of previously permitted debt and make previously permitted investments and other restricted payments. In connection with this amendment, we issued 750,000 shares of common stock to the CCF Lender and the number of warrants held by the CCF Lender was reduced by the same amount.

The CCF bears interest at a rate per annum equal to the sum of (i) 5.25% and (ii) a scheduled interest rate of 4% (the “Cash Pay Interest Rate”) which increases by 0.125% every six-month period from the Closing Date, subject to increase during the extension periods. The effective interest rate at June 30, 2023 and December 31, 2022 was 10.325% and 10.0%, respectively. A $2.45 million commitment fee was payable 50% on the initial draw and 50% as amounts under the CCF are drawn, with any remaining balance due on the last date of the draw period, and a 1.0% exit fee is payable in respect of CCF repayments. As of June 30, 2023, we had paid $1.85 million of the commitment fee. With the reduction in the committed amount under the CCF, no further commitment fee is due. The CCF may be prepaid at any time subject to a prepayment premium on the portion of the CCF being repaid. The CCF is subject to certain mandatory prepayment provisions, including that, subject to the terms of the mortgage loan documents applicable to the Company’s 77 Greenwich property, 90% or 100% of the net cash proceeds of residential condominium sales, depending on the circumstances, and 70% of the net cash proceeds of retail condominium sales at the Company’s 77 Greenwich property shall be used to repay the CCF. Upon final repayment of the CCF, the MOIC amount equal to 30% of the initial CCF amount plus drawn incremental amounts less the sum of all interest payments, commitment fee and exit fee payments and prepayment premiums, if any, shall be due, if such amounts are less than the MOIC amount. The collateral for the CCF consists of (i) 100% of the equity interests in our direct subsidiaries, to the extent such a pledge is permitted by the organizational documents of such subsidiary and any financing agreements to which such subsidiary is a party, (ii) our cash and cash equivalents, excluding restricted cash and cash applied toward certain liquidity requirements under existing financing arrangements, and (iii) other non-real estate assets of ours, including intellectual property. The Company determined that the CCF will be treated as a modification with no gain or loss recognized during the three and six month period ended June 30, 2023 as the carrying amount of the loan was not greater than the respective undiscounted cash flows of the modified loan.

The CCF provides that we and our subsidiaries must comply with various affirmative and negative covenants including restrictions on debt, liens, business activities, equity repurchases, distributions and dividends, disposition of assets and transactions with affiliates, as well as financial covenants regarding corporate loan to value and net worth. The CCF also provides for certain events of default, including cross-defaults to our other loans, and for a guaranty of the CCF obligations by our loan party subsidiaries.

Pursuant to the terms of the CCF, so long as the CCF is outstanding and the CCF Lender is owed or holds greater than 50% of the sum of (x) the aggregate principal amount of the balance outstanding and (y) the aggregate unused commitments, the CCF Lender will have the right to appoint one member to our and each of our subsidiary’s board of

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directors or equivalent governing body (the “Designee”). At the election of the CCF Lender, a board observer may be selected in lieu of a board member. The Designee may also sit on up to three committees of the board of directors or equivalent governing body of ours and each subsidiary of the Designee’s choosing from time to time. The Designee will be entitled to receive customary reimbursement of expenses incurred in connection with his or her service as a member of the board and/or any committee thereof but will not, except in the case of an independent director, receive compensation for such service. The April 2023 amendment to the CCF also provided the CCF Lender with the right to appoint an independent director to the Company’s Board of Directors (the “Independent Director Designee”), in addition to its existing right to appoint the Designee so long as the advances remain outstanding and the CCF Lender is owed or holds greater than 50% of the sum of the aggregate principal amount of advances outstanding and the aggregate unused commitments. At the election of the CCF Lender, a Board observer may be selected in lieu of the Independent Director Designee. The Independent Director Designee, who was appointed in May 2023, may sit on up to three Board committees and will be automatically included on any Board committee relating to a Strategic Transaction.

The CCF had an outstanding balance of $38.75 million and $35.75 million at June 30, 2023 and December 31, 2022, respectively, excluding deferred finance fees of $828,000 and $1.3 million, respectively. Accrued interest, which is included in accounts payable and accrued expenses, totaled approximately $7.8 million at June 30, 2023 and $6.1 million at December 31, 2022, of which approximately $419,000 was paid during the first week of January 2023.

As of June 30, 2023, we were in compliance with the covenants of the CCF.

Loans Payable

77 ~~Greenwich~~Mortgage Loan

~~On February 9, 2015, our~~In October 2021, a wholly-owned subsidiary ~~that owns 77 Greenwich and related assets (“TPH Greenwich~~of ours (the “Mortgage Borrower”), entered into a loan agreement with ~~Sterling National Bank~~Macquarie PF Inc., a part of Macquarie Capital, the advisory, capital markets and principal investment arm of Macquarie Group, as lender and administrative agent (the ~~“Agent”), and Israel Discount Bank of New York, as lender (the “Lender”~~“77 Mortgage Lender”), pursuant to which ~~we borrowed $40.0~~77 Mortgage Lender agreed to extend credit to Mortgage Borrower in the amount of up to $166.7 million (the “77 ~~Greenwich~~Mortgage Loan”)~~. The 77 Greenwich Loan can be increased up~~, subject to ~~$50.0 million, subject to~~the satisfaction of certain ~~conditions. The~~conditions (the “77 Mortgage Loan Agreement”). We borrowed $133.1 million on the closing date of the 77 ~~Greenwich~~Mortgage Loan ~~which was scheduled~~and a portion of the proceeds of the 77 Mortgage Loan, together with the proceeds of an increase in the Mezzanine Loan, the Berkley Partner Loan and funds raised through the Private Placement were used to ~~mature on August 8, 2017, was extended to mature on February 8, 2018. We are evaluating our options which include, among others, refinancing~~repay the 77 Greenwich construction facility that the Company entered into in December 2017. At the time of the closing of the 77 Mortgage Loan ~~as part~~in October 2021, $33.6 million was available to be used to, among other things, complete construction of ~~a construction loan.~~77 Greenwich and fund carry costs while the residential condominium units are being sold.

The 77 ~~Greenwich~~Mortgage Loan has a two-year term, maturing on October 1, 2023, with an option to extend for an additional year, if, among other conditions, the loan balance is $70.0 million or less and we purchase a new interest rate cap. Based on the current sales pace and market conditions, the Company currently anticipates the loan balance will exceed $70.0 million. The 77 Mortgage Loan is secured by the Mortgage Borrower’s fee interest in 77 Greenwich. In May 2023, the loan benchmark was converted from LIBOR to SOFR. The 77 Mortgage Loan bears interest at a rate per annum equal to the greater of (i) 7.00% in excess of SOFR and (ii) 7.25%; provided that, if, on April 22, 2023, the outstanding principal balance of the 77 Mortgage Loan, together with any accrued and unpaid PIK Interest and unpaid Additional Unused Fee (as those terms are defined below) is equal to or greater than $91.0 million, the rate ~~published~~per annum will be equal to the greater of (i) 9.00% in excess of SOFR and (ii) 9.25%. The all-in interest rate was 12.05% at June 30, 2023. If cash flow from 77 Greenwich (including proceeds from the sales of residential condominium units) is insufficient to pay interest payments when due, any accrued but unpaid interest will remain unpaid and interest will continue to accrue on such unpaid amounts (“PIK Interest”) until the cumulative PIK Interest and Additional Unused Fee accrues to $4.5 million (the “Threshold Amount”), after which all such amounts in excess of the Threshold Amount shall be paid in cash on a monthly basis until such amounts are less than the Threshold Amount. As advances of the 77 Mortgage Loan are made to Mortgage Borrower and the outstanding principal balance of the 77 Mortgage Loan increases, net proceeds from the sales of condominium units will be paid to 77 Mortgage Lender to reduce the outstanding balance of the 77 Mortgage Loan. A 1% per annum fee (the “Additional Unused Fee”) on a $3.0 million portion (the “Additional Amount”) of the 77 Mortgage Loan, is payable on a monthly basis on the undrawn portion of such Additional Amount. To the extent the 77 Mortgage Loan was not fully funded by October 22, 2022 (April 22, 2023 in the case of amounts with respect to construction work related to the new handicapped accessible subway entrance on Trinity Place), 77 Mortgage Lender had the discretion to force fund the remaining balance other than the Additional Amount into a reserve account held by 77 Mortgage Lender and disbursed in accordance with the terms of the 77 Mortgage Loan Agreement. The 77 Mortgage Lender elected to force fund the 77

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Mortgage Loan in October 2022. The 77 Mortgage Loan is prepayable without penalty, subject to 77 Mortgage Lender receiving a minimum total return of $15.26 million, or if an advance has been made of the Additional Amount, the sum of $15.26 million, plus 10% of the Additional Amount that has been disbursed, in each case, inclusive of interest and fees, and must be prepaid in part in certain circumstances such as in the event of the sale of residential and retail condominium units. Mortgage Borrower was required to achieve completion of the construction work and the improvements for the project on or before July 1, 2022, subject to certain exceptions. The 77 Mortgage Loan Agreement also includes additional customary affirmative and negative covenants for loans of this type, with the first sales pace covenant in April 2023, which was met. We also met our sales pace test as of July 2023. In November 2022, we amended the 77 Mortgage Loan to, amongst other things, extend the Final Completion date to September 29, 2023 and eliminate the liquidity requirement. At that time, we drew down $3.0 million under the letter of credit to ~~time by~~fund an interest reserve and $1.0 million to pay down the ~~Wall Street Journal~~PIK balance. The Company determined that the 77 Mortgage Loan was considered a troubled debt restructuring due to a decrease in the post restructuring effective interest rate. The Company determined that the 77 Mortgage Loan will be treated as a modification with no gain or loss recognized during the six month period ended June 30, 2023 as the ~~U.S. Prime Rate plus 1.25% (the “Contract Rate”) or (ii) 4.50% and requires interest only payments through maturity. The interest rate on~~carrying amount of the loan was not greater than the respective undiscounted cash flows of the modified loan.

In connection with the 77 ~~Greenwich~~Mortgage Loan was 5.00% as of December 31, 2016 and 5.50% as of September 30, 2017. The Contract Rate will be increased by 1.5% per annum during any period in which TPH Greenwich Borrower does not maintain funds in its deposit accountsAgreement, we entered into guarantees with the ~~Agent~~77 Mortgage Lender pursuant to which we guaranteed the completion and payment of costs and expenses related to the construction; the payment of accrued and unpaid interest and other fees, costs, expenses and payments due and payable with respect to the 77 Mortgage Loan or 77 Greenwich; and the payment when due of all amounts due to 77 Mortgage Lender, ~~sufficient to make payments then due under the 77 Greenwich Loan documents. TPH Greenwich~~as a result of “bad-boy” provisions. Mortgage Borrower ~~can prepay the 77 Greenwich Loan at any time, in whole or in part, without premium or penalty.~~

~~The collateral for the 77 Greenwich Loan is TPH Greenwich Borrower’s fee interest in 77 Greenwich~~ and the ~~related air rights, which is the subject of a mortgage in favor of the Agent. TPH Greenwich Borrower~~Company also entered into an environmental compliance and indemnification ~~undertaking.~~undertaking for the benefit of 77 Mortgage Lender.

~~The~~As of June 30, 2023, we had received TCOs for 100% of the residential condominium units, lobby, Cloud Club (lounge, terrace, game room, dining room, kitchen and kids play room), mechanical rooms, and portions of the cellar (including the bike and storage rooms.) Upon the granting of our first TCO in March 2021 and having 16 units under contract, our offering plan was declared effective.

As of June 30, 2023, the 77 ~~Greenwich~~Mortgage Loan ~~agreement requires TPH Greenwich Borrower to comply with various affirmative and negative covenants including restrictions on debt, liens, business activities, distributions and dividends, disposition~~had a balance of ~~assets and transactions with affiliates. TPH Greenwich Borrower has established blocked accounts~~$106.0 million, which includes $4.4 million in PIK interest. Through June 30, 2023, the 77 Mortgage loan was paid down by approximately $62.1 million through closed sales of residential condominium units.

As of June 30, 2023, we were in compliance with the ~~initial lenders,~~covenants under the 77 Mortgage Loan.

Mezzanine Loan

In December 2020, we entered into a mezzanine loan agreement with an affiliate of the CCF Lender (the “Mezzanine Loan Agreement”, and ~~pledged~~ the ~~funds maintained in such accounts, in~~loan thereunder, the “Mezzanine Loan”). The Mezzanine Loan was originally for the amount of 9%$7.5 million and has a term of ~~the outstanding loans. The 77 Greenwich Loan agreement also provides for certain events of default. As of September 30, 2017, TPH Greenwich Borrower was in compliance~~three years with ~~all 77 Greenwich Loan covenants.~~

We entered into a Nonrecourse Carve-Out Guaranty pursuant to which we agreed to guarantee certain items, including losses arising from fraud, intentional harm to 77 Greenwich, or misapplication of loan, insurance or condemnation proceeds, a voluntary bankruptcy filing by TPH Greenwich Borrower, and the payment by TPH Greenwich Borrower of maintenance costs, insurance premiums and real estate taxes.

~~West Palm Beach, Florida Loan~~

On May 11, 2016, our subsidiary that owns our West Palm Beach, Florida property commonly known as The Shoppes at Forest Hill (the “TPH Forest Hill Borrower”), entered into a loan agreement with Citizens Bank, National Association, as lender (the “WPB Lender”), pursuant to which the WPB Lender will provide a loan to the TPH Forest Hill Borrower in the amount of up to $12.6 million, subject to the terms and conditions as set forth in the loan agreement (the “WPB Loan”). TPH Forest Hill Borrower borrowed $9.1 million under the WPB Loan at closing. The WPB Loan requires interest-only payments and bears interest at the 30-day LIBOR plus 230 basis points. The effective interest rate was 2.75% as of December 31, 2016 and 3.54% as of September 30, 2017. The WPB Loan matures on May 11, 2019, subject totwo one-year extension ~~until May 11, 2021~~options, exercisable under certain circumstances. The ~~TPH Forest Hill Borrower can prepay~~collateral for the ~~WPB~~Mezzanine Loan ~~at any time,~~was the borrower’s equity interest in its direct, wholly-owned subsidiary, which owns 100% of the equity interests in the borrower under the 77 Mortgage Loan. As of June 30, 2023, the annual blended interest rate for the 77 Mortgage Loan and the Mezzanine Loan was 12.05%. Interest on the Mezzanine Loan is not payable on a monthly basis but instead is automatically added to the unpaid principal amount on a monthly basis (and therefore accrues interest) and is payable in full on the maturity date of the Mezzanine Loan. Upon final repayment of the Mezzanine Loan, a MOIC will be due on substantially the same terms as provided for in the CCF. The Mezzanine Loan may not be prepaid prior to prepayment in full of the 77 Mortgage Loan, but if the 77 Mortgage Loan is being prepaid in full, the Mezzanine Loan may be prepaid simultaneously therewith. Subject to the prior sentence the Mezzanine Loan may be prepaid in whole or in part, without penalty or premium ~~or penalty.~~(other than payment of the MOIC amount, if applicable, as provided above), upon prior written notice to the lender under the Mezzanine Loan. In connection with the Mezzanine Loan, the Company entered into a completion guaranty, carry guaranty, equity funding guaranty, recourse guaranty and environmental indemnification undertaking substantially consistent with the Company’s existing guarantees made to the 77 Mortgage Lender in connection with the 77 Greenwich Mortgage Loan.

~~The~~In October 2021, the Mezzanine Loan Agreement was amended and restated to, among other things, (i) increase the amount of the loan thereunder by approximately $22.77 million, of which $0.77 million reflects interest previously accrued under the original Mezzanine Loan, (ii) reflected the pledge of the equity interests in the Mortgage Borrower to the Mezzanine Lender as additional collateral for the ~~WPB~~Mezzanine Loan isand (iii) conform certain of the ~~TPH Forest Hill Borrower’s fee interest~~covenants to those included in ~~our West Palm Beach, Florida property. The WPB~~the 77 Mortgage Loan ~~requires~~Agreement, as applicable. Additionally, the ~~TPH Forest Hill Borrower~~existing completion guaranty, carry guaranty, recourse

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guaranty and environmental indemnification executed in connection with the original Mezzanine Loan Agreement were amended to ~~comply~~conform to the mortgage guarantees and mortgage environmental indemnity made in connection with ~~various customary affirmative~~the 77 Mortgage Loan (and the existing equity funding guaranty was terminated). In November 2022, we amended the Mezzanine Loan Agreement to, amongst other things, extend the Final Completion date to September 29, 2023 and ~~negative covenants and provides for certain events of default,~~eliminate the ~~occurrence of which permit the WPB Lender to declare the WPB Loan due and payable, among other remedies.~~ liquidity requirement.

As of ~~September~~June 30, ~~2017,~~2023, the ~~TPH Forest Hill Borrower was~~Mezzanine Loan had a balance of $30.3 million and accrued interest totaled approximately $8.4 million.

As of June 30, 2023, we were in compliance with ~~all WPB~~the covenants of the Mezzanine Loan.

237 11^thLoans

In June 2021, we entered into a $50.0 million senior loan (the “237 11^th Senior Loan”) provided by Natixis and a $10 million mezzanine loan (the “237 11^th Mezz Loan” and together with the 237 11^th Senior Loan, ~~covenants.~~the “237 11^th Loans”), provided by an affiliate of LibreMax Capital, LLC, bearing interest at a blended rate of 3.05% per annum at that time. Both loans had a two-year initial term subject to 1-year extension rights. The Company exercised its right to extend both loans by one year.

~~On May 11, 2016~~In June 2021, we also entered into an interest rate cap agreement as required under the ~~WPB Loan.~~237 11^th Loans. The interest rate cap agreement ~~provides~~provided the right to receive cash if the reference interest rate ~~rises~~rose above a contractual rate. We paid a premium of ~~$14,000~~approximately $32,500 for the ~~3.0%~~2.5% interest rate cap ~~for~~on the 30-day LIBOR rate on ~~the~~a notional amount of ~~$9.1~~$60.0 million. The ~~fair value of the~~ interest rate cap asmatured in July 2023 and a new interest rate cap was purchased in connection with the exercise by the Company of ~~September 30, 2017 and December 31, 2016 is recorded in prepaid expenses and other assets, net in our condensed consolidated balance sheets.~~a one year extension (see Note 14 – Subsequent Events for additional information). We did not designate this interest rate cap as a hedge and are recognizing the change in estimated fair value in interest expense. ~~During~~

In December 2022, we amended the ~~nine months~~237 11^th Loans to allow for the 237 11^th Senior Loan lender to fund the undrawn operating expense shortfall holdback and force fund the undrawn portion of the leasing related costs and the loan benchmark was converted from LIBOR to SOFR. The Company determined that the 237 11th Mezz Loan is considered a troubled debt restructuring due to a decrease in the post restructuring effective interest rate. The Company determined that the 237 11^th Loans were treated as modifications with no gain or loss recognized during the six month period ended ~~September~~June 30, ~~2017, we recognized~~2023 as the ~~change~~carrying amount of loans was not greater than the respective undiscounted cash flows of the modified loans.

As of June 30, 2023, the blended interest rate was 5.35% per year. The SOFR-based floating rate 237 11^th Loans have an initial term of two years and three one-year extension options. The first extension option, which was exercised in ~~value~~July 2023, was not subject to satisfaction of ~~the~~any financial tests, but required a new interest rate cap be purchased by the Company.

The 237 11^th Loans require us to comply with various customary affirmative and negative covenants and provide for certain events of ~~approximately $3,000 in interest expense.~~ default, the occurrence of which would permit the lender to declare the 237 11^th Loans due and payable, among other remedies.

As of ~~September~~June 30, ~~2017,~~2023 and December 31, 2022, there was an outstanding balance of $50.0 million on the ~~carrying value~~237 11^th Senior Loan and $10.0 million on the 237 11^th Mezz Loan.

As of June 30, we were in compliance with the covenants of the ~~interest rate cap was approximately $6,000.~~237 11^th Loans.

Secured Line of Credit

~~On February 22, 2017, we entered into two~~Our $11.75 million secured lines of credit for an aggregate of $12.0 million, with Sterling National Bank as the lender, which were secured by our properties located in Paramus, New Jersey, and Westbury, New York, respectively, and had an original maturity date of February 22, 2018. On August 4, 2017, in connection with the sale of the Westbury, New York property, the $2.9 million line of credit ~~that was secured by this property, and which was undrawn, matured on that date. The $9.1 million line of credit, which~~ is secured by the Paramus, New Jersey property. The Paramus property had been under contract for sale pursuant to a purchase and sale agreement, which was ~~undrawn as of September 30, 2017 and November 8, 2017. This~~subject to site plan approval. The agreement was terminated by the buyer in January 2023. The secured line of credit was ~~increased~~scheduled to ~~$11.0 million in September 2017,~~mature on May 22, 2023 and ~~we extended~~bore interest at the prime rate. Effective with an April 2023 amendment, the maturity date was extended to ~~February~~March 22, ~~2019.~~2024 and the interest rate was reduced to 2.5% during the period from April 2023 to the new maturity date. The secured line of credit ~~bears interest, for drawn amounts only, at 100 basis points over Prime, as defined, with a floor of 3.75%, and~~ is pre-payable at any time without penalty. This secured line of credit had an outstanding balance of $11.75 million and $9.75 million at June 30, 2023 and December 31, 2022, respectively, and an effective interest rate of 2.5% and 7.5% as of June 30, 2023 and December 31, 2022, respectively. The Company determined that the secured line of credit

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was considered a troubled debt restructuring due to a decrease in the post restructuring effective interest rate. The Company determined that the secured line of credit will be treated as a modification with no gain or loss recognized during the six month period ended June 30, 2023 as the carrying amount of the loan was not greater than the respective undiscounted cash flows of the modified loan.

Note Payable (250 North 10^th Partner Loan)

We owned a 10% interest in a joint venture with TF Cornerstone (the “250 North 10^th JV”) formed to acquire and operate 250 North 10^th, a 234-unit apartment building in Williamsburg, Brooklyn, New York. On January 15, 2020, the 250 North 10^th JV closed on the acquisition of the property. Our share of the equity totaling approximately $5.9 million was funded through a loan (the “Partner Loan”) from our joint venture partner. The Partner Loan, which had a balance of $5.9 million, which was repaid in full when we sold our interest in the joint venture to our joint venture partner in February 2023, bore interest at 7.0% and was prepayable any time within its four year term. See also Note 13 – Investments in Unconsolidated Joint Ventures.

Principal Maturities

Combined aggregate principal maturities of our loans, corporate credit facility and secured line of credit as of June 30, 2023, excluding extension options, were as follows (in thousands):


Year of Maturity	Principal

2023	$	136,228
2024		110,500
2025		—
2026		—
2027		—
		246,728
Less: deferred finance costs, net		(1,509)
Total loans, corporate credit facility and secured line of credit, net	$	245,219

Interest

Consolidated interest ~~(income)~~ expense, net includes the following (in thousands):

	Three Months Ended September 30, 2017			Three Months Ended September 30, 2016			Nine Months Ended September 30, 2017			Nine Months Ended September 30, 2016


													Three Months Ended		Three Months Ended		Six Months Ended		Six Months Ended
													June 30,		June 30,		June 30,		June 30,
													2023		2022		2023		2022


Interest expense	$	644		$	553		$	1,832		$	1,549		$	7,194	$	4,541	$	14,211	$	8,828
Interest capitalized		(562	)		(486	)		(1,602	)		(1,438	)		—		(1,246)		(689)		(2,764)
Interest income		(102	)		(55	)		(141	)		(194	)
Interest (income) expense, net	$	(20	)	$	12		$	89		$	(83	)
Interest expense, net													$	7,194	$	3,295	$	13,522	$	6,064

Note 67 – Fair Value Measurements

The fair value of our financial instruments are determined based upon applicable accounting guidance. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The guidance requires disclosure of the level within the fair value hierarchy in which the fair value measurements fall, including measurements using quoted ~~process~~prices in active markets for identical assets or liabilities (Level 1), quoted ~~process~~prices for similar instruments in active markets or quoted ~~process~~prices for identical or similar instruments in markets that are not active (Level 2), and significant valuation assumptions that are not readily observable in the market (Level 3).

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The fair values of cash and cash equivalents, receivables, ~~prepaid expenses and other assets,~~ accounts payable and accrued expenses, and other liabilities approximated their carrying value because of ~~the~~their short-term ~~nature of these instruments.~~nature. The fair value of ~~each of~~ the consolidated loans payable and Corporate Credit Facility approximated their carrying values as they are variable-rate instruments under Level 2. The secured line of credit approximated its carrying value as it is a fixed-rate near term maturity instruments under Level 2. The warrant liability is recorded at fair value under Level 2.

On an annual recurring basis, we are required to use fair value measures when measuring plan assets of our pension plans. As we elected to adopt the measurement date provisions of ASC 715, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans,” as of March 4, 2007, we were required to determine the fair value of our pension plan assets as of December 31, 2022. The fair value of pension plan assets was $12.6 million at December 31, 2022. These assets are valued in active liquid markets under Level 2.

We recognized the fair values of all derivatives in prepaid expenses and other assets, net on our ~~loans~~consolidated balance sheets based on Level 2 information. Derivatives that are ~~variable-rate instruments.~~not hedges are adjusted to fair value through earnings. The changes in the fair value of the derivative is offset against the change in fair value of the hedged asset through interest expense, net for the three and six months ended June 30, 2023 and 2022, respectively. Reported net loss may increase or decrease prospectively, depending on future levels of interest rates and other variables affecting the fair values of hedging instruments and hedged items, but will have no effect on cash flows.

The following table summarizes our consolidated hedging instruments, all of which hedge variable rate debt, as of June 30, 2023 and December 31, 2022 (in thousands):


	Fair Value Asset as of June 30,		Fair Value Asset as of December 31,		Change in Fair Value June 30,		Change in Fair Value June 30,		Notional Amount		All-In Capped Rate		Interest Rate Cap Expiration Date
	2023		2022		2023		2022
Interest Rate Caps:
77 Mortgage Loan	$	560	$	1,298	$	(738)	$	745	$	67,000	2.5	%	11/1/2023
237 11^th Loans		35		707		(672)		482	$	60,000	2.5	%	7/9/2024
Included in prepaid expenses and other assets, net	$	595	$	2,005	$	(1,410)	$	1,227

Note 78 – Pension ~~and Profit Sharing Plans~~Plan

~~Pension Plans~~ ~~– Our predecessor,~~ Syms sponsored a defined benefit pension plan for certain eligible employees not covered under a collective bargaining agreement. The pension plan was frozen effective December 31, 2006. ~~As of September~~At June 30, ~~2017~~2023 and December 31, ~~2016,~~2022, we had a recorded ~~liability~~an underfunded pension balance of ~~$2.9 million and $3.4 million,~~approximately $651,000, respectively, which is included in pension ~~liabilities~~liability on the accompanying ~~condensed~~ consolidated balance sheets. If we decided to terminate the plan under a standard termination, we would be required to make additional contributions to the plan so that the assets of the plan are sufficient to satisfy all benefit liabilities.

We currently ~~intend~~plan to continue to maintain the Syms pension plan and make all contributions required under applicable minimum funding ~~rules, although~~rules; however, we may terminate ~~the Syms pension plan.~~it at any time. In the event ~~that~~ we terminate the ~~Syms pension~~ plan, we intend that any such termination ~~shall~~would be a standard termination.

~~Prior~~ Although we have accrued the liability associated with a standard termination, we have not taken any steps to commence such a termination and currently have no intention of terminating the ~~bankruptcy, certain employees were covered by collective bargaining agreements and participated in multiemployer~~ pension plans. Syms ceased to have an obligation to contribute to these plans in 2012, thereby triggering a complete withdrawal from the plans within the meaning of section 4203 of the Employee Retirement Income Security Act of 1974. Consequently, we are subject to the payment of a withdrawal liability to the remaining pension fund. As of September 30, 2017 and December 31, 2016, we had a recorded liability of $1.9 million and $2.5 million, respectively, which is reflected in pension liabilities on the accompanying condensed consolidated balance sheets. We are required to make quarterly distributions in the amount of $0.2 million until this liability is completely paid to the multiemployer plan.

In accordance with minimum funding requirements and court ordered allowed claims distributions, we paid approximately ~~$4.1~~$6.1 million to the Syms sponsored plan ~~and approximately $5.0 million to the multiemployer plans~~ from September 17, 2012 through ~~September~~June 30, ~~2017. Approximately $0.5 million was~~2023. Historically, we have funded ~~during~~this plan in the ~~three and nine months ended September 30, 2017~~third quarter of the calendar year. We funded $400,000 to the Syms sponsored plan ~~and $0.2 million and $0.6 million was funded during the three months and nine months, respectively, ended~~in September ~~30, 2017 to the multiemployer plan.~~

2022.

Note 89 – Commitments

Leases~~Leases~~ – ~~As of September 30, 2017, our prior corporate office located at 717 Fifth Avenue, New York, New York had a remaining lease obligation of one month for $31,000 payable through October 31, 2017.~~ The ~~rent expense paid for this operating~~ lease for ~~the three and nine months ended September 30, 2017 was approximately $75,000 and $225,000, respectively. Our new~~our corporate office located at 340 Madison Avenue, New York, New York ~~has a~~expires on March 31, 2025. Rent expense paid for this operating lease was approximately $118,000 for each of the three months ended June 30, 2023 and 2022, respectively, and approximately $235,000 for each of the six

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months ended June 30, 2023 and 2022, respectively. The remaining cash lease obligation, ~~of $3.2 million payable~~excluding any extension options, for our corporate office is approximately $821,000 through March 31, ~~2025.~~2025 and is as follows (in thousands):


	Future
	Minimum
Year Ended	Rentals
2023	$	235
2024		470
2025		116
Total undiscounted lease payments	$	821
Discount		3
Lease Liability	$	824

Legal Proceedings - We – In the normal course of business, we are a party to routine ~~litigation incidental to our business. Some~~legal proceedings. Based on advice of ~~the actions to which~~counsel and available information, including current status or stage of proceeding, and taking into account accruals where they have been established, management currently believes that any liabilities ultimately resulting from litigation we are currently involved in will not, individually or in the aggregate, have a ~~party are covered by insurance and are being defended~~material adverse effect on our consolidated financial position, results of operations or ~~reimbursed by our insurance carriers.~~liquidity.

Note 910 – Income Taxes

~~At September~~As of June 30, ~~2017,~~2023, we had federal NOLs of approximately ~~$230.3~~$293.4 million. ~~These~~ NOLs generated prior to tax-year 2018 will expire in years through fiscal ~~2034. At September~~2037 while NOLs generated in 2018 and forward carry-over indefinitely. The gain resulting from the conveyance of the school condominium to the SCA was fully offset by our available NOL carryforward. Since 2009 through June 30, ~~2017,~~2023, we have utilized approximately $20.1 million of our federal NOLs. As of June 30, 2023, we also had state NOLs of approximately ~~$104.4~~$222.8 million. These state NOLs ~~expire between 2029 and 2034.~~have various expiration dates through 2042, if applicable. We also had ~~the~~additional New York State and New York City prior NOL conversion (“PNOLC”) subtraction pools of approximately ~~$31.1~~$27.9 million and ~~$25.5~~$22.9 million, respectively. The conversion to the PNOLC under the New York State and New York City corporate tax reforms does not have any material tax impact.

Based on management’s assessment, we believe it is more likely than not that the entire deferred tax assets will not be realized by future taxable income or tax planning strategy. In recognition of this risk, we have provided a valuation allowance of ~~$96.8 million and $95.3~~$83.9 million as of ~~September~~June 30, ~~2017 and December 31, 2016, respectively.~~2023. If our assumptions change and we determine we will be able to realize these NOLs, the tax benefits relating to any reversal of the valuation allowance on deferred tax assets would be recognized as a reduction of income tax expense and an increase in ~~equity.~~the deferred tax asset.

Note 1011 – Stockholders’ Equity

Capital Stock

Our authorized capital stock consists of 120,000,000 shares ~~$0.01 par value per share,~~ consisting of 79,999,997 shares of common stock, $0.01 par value per share, two (2) shares of preferred stock, $0.01 par value per share (which have been redeemed in accordance with their terms and may not be reissued), one (1) share of special stock, $0.01 par value per share, and 40,000,000 shares of a new class of ~~blank check~~blank-check preferred stock, $0.01 par value per share. As of ~~September~~June 30, ~~2017~~2023 and December 31, ~~2016,~~2022, there were ~~36,806,915~~44,804,002 shares and ~~30,679,566~~43,448,384 shares of common stock issued, respectively, and ~~31,451,796~~38,038,305 shares and ~~25,663,820~~36,907,862 shares of common stock outstanding, ~~respectively.~~respectively, with the difference being held in treasury stock.

Warrants

~~On February 14, 2017,~~In December 2019, we entered into a Warrant Agreement (the “Warrant Agreement”) with the lender under our CCF (see Note 6 – Loans Payable and Secured Line of Credit – Corporate Credit Facility) (the “Warrant Holder”) pursuant to which we issued ~~an aggregate~~ten-year warrants (the “Warrants”) to the Warrant Holder to purchase up to 7,179,000 shares of ~~3,585,000~~our common

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stock. In December 2020, the Company entered into the Warrant Agreement Amendment, whereby the exercise price of the warrants issued in connection with the CCF was amended to be $4.50 per share. In connection with the October 2021 Private Placement, the exercise price of the warrants were further reduced to $4.31 per share (the “Exercise Price”), which is payable in cash or pursuant to a cashless exercise. The Warrant Agreement provides that we will not issue shares of common stock ~~in a private placement at a purchase price~~upon exercise of ~~$7.50 per share, and received gross proceeds~~the Warrants if either (1) the Warrant Holder, together with its affiliates, would beneficially hold 5% or more of ~~$26.9 million. On April 5, 2017, we issued an aggregate of 1,884,564~~the shares of common stock outstanding immediately after giving effect to such exercise, or (2) such exercise would result in the issuance of more than 19.9% of the shares of issued and outstanding common stock as of the date of the Warrant Agreement, prior to giving effect to the issuance of the Warrants, and such issuance would require shareholder approval under the NYSE American LLC listing requirements. The Warrant Agreement provides for certain adjustments to the Exercise Price and/or the number of shares of common stock issuable upon exercise pursuant to customary anti-dilution provisions. Upon a ~~rights offering~~change of control of the Company, the Warrants will be automatically converted into the right to receive the difference between the consideration the Warrant Holder would have received if it exercised the Warrants immediately prior to the change of control and the aggregate Exercise Price, payable at ~~a purchase price~~the election of ~~$7.50 per share~~the Warrant Holder in the consideration payable in the change of control or, if such consideration is other than cash, in cash.

In connection with the June 2023 amendment to the CCF (See Note 6 – Loans Payable and ~~received gross proceeds~~Secured Line of ~~$14.1 million (the “Rights Offering”). We anticipate using~~Credit), the ~~proceeds~~parties entered into an amendment to the Warrant Agreement, pursuant to which the number of shares of common stock purchasable under the Warrants was reduced by 750,000 shares, and the Company issued 750,000 shares of common stock to the CCF Lender. As of June 30, 2023, 6,429,000 warrants were outstanding.

The Warrants were valued at approximately $17,000 and $76,000 at June 30, 2023 and December 31, 2022, respectively. The unrealized gain of $56,000 and $931,000 from the ~~private placement~~change in fair value of the Warrants during the six months ended June 30, 2023 and 2022, respectively, was recorded in the consolidated statements of operations and comprehensive loss.

In connection with the issuance of the Warrants, we also entered into a registration rights agreement with the Warrant Holder, pursuant to which we agreed to register for resale the shares of common stock issuable upon exercise of the Warrants (the “Registration Rights ~~Offering~~Agreement”), and a letter agreement with the Warrant Holder (the “Letter Agreement”) pursuant to which we agreed to provide (i) certain information rights, (ii) the right to appoint one member of the board of directors of the Company, or in lieu thereof a board observer, and (iii) certain preemptive rights for a period of five years following the ~~development~~exercise of ~~77 Greenwich, potential new real estate acquisitions~~any of the Warrants so long as the Warrant Holder continues to hold shares of common stock. With respect to the board appointment right, the Letter Agreement includes a similar right as the CCF, as described in Note 6 – Loans Payable and ~~investment opportunities and for working capital.~~Secured Line of Credit, so long as the Warrant Holder together with its affiliates beneficially holds at least 5% of the outstanding common stock of the Company, assuming the exercise of all outstanding Warrants; provided that the Warrant Holder does not have such appointment right at any time a Designee, who was appointed in May 2023, or observer may be appointed pursuant to the terms of the CCF.

~~At-The-Market Equity Offering~~Share Repurchase Program

In December ~~2016,~~2019, our Board of Directors approved a stock repurchase program under which we ~~entered into an "at-the-market" equity offering program (the “ATM Program”), to sell~~can purchase up to ~~an aggregate~~$5.0 million of ~~$12.0 million~~shares of our common ~~stock. During~~stock, which is now subject to the terms of our Corporate Credit Facility. Repurchases under the stock repurchase program may be made through open market or privately negotiated transactions at times and on such terms and in such amounts as management deems appropriate, subject to market conditions, regulatory requirements and other factors. The program does not obligate the Company to repurchase any particular amount of common stock, and may be suspended or discontinued at any time without notice.

From inception of the stock repurchase program through December 31, 2020, the Company repurchased 250,197 shares of common stock for approximately $483,361, or an average price per share of $1.93. As of June 30, 2023, approximately $4.5 million of shares remained available for purchase under the stock repurchase program, subject to the terms of our Corporate Credit Facility. There was no stock repurchase activity by the Company or any “affiliated purchaser” of the Company, as defined in Rule 10b-18(a)(3) under the Exchange Act, during the six months ended June 30, 2023 or the year ended December 31, 2016, we issued 120,299 shares of our common stock for aggregate gross proceeds of $1.2 million (excluding approximately $218,000 in professional and brokerage fees) at a weighted average price of $9.76 per share. For the three and nine months ended September 30, 2017, we issued no shares and 2,492 shares, respectively, of our common stock and received gross proceeds of $0 and $23,000, respectively, at a weighted average price of $9.32 per share. As of September 30, 2017, $10.8 million of common stock remained available for issuance under the ATM Program.2022.

Preferred Stock

We are authorized to issue two shares of preferred stock (one share each of Series A and Series B preferred ~~stock)~~stock, each of which was automatically redeemed in 2016 and may not be reissued), one share of special stock and 40,000,000 shares of

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blank-check preferred stock. ~~The share of Series A preferred stock was issued to a trustee acting for the benefit of our creditors. The share of Series B preferred stock was issued to the former Majority Shareholder.~~ The share of special stock was issued and sold to Third Avenue Trust, on behalf of Third Avenue Real Estate Value Fund (“("Third ~~Avenue”~~Avenue"), and enables Third Avenue or its affiliated designee to elect one member of the Board of Directors.

On or about March 8, 2016, a General Unsecured Claim Satisfaction occurred. Under the Plan, a General Unsecured Claim Satisfaction occurs when all of the allowed creditor claims of Syms Corp. and Filene’s Basement, LLC, have been paid in full their distributions provided for under the Plan and any disputed creditor claims have either been disallowed or reserved for by Trinity. On March 14, 2016, we made the final Majority Shareholder payment (as defined in the Plan) to the Majority Shareholder in the amount of approximately $6.9 million. Following the General Unsecured Claim Satisfaction and payment to the former Majority Shareholder, we satisfied our payment and reserve obligations under the Plan. Upon the occurrence of the General Unsecured Claim Satisfaction, the share of Series A preferred stock was automatically redeemed in accordance with its terms and may not be reissued. In addition, upon the payment to the former Majority Shareholder, the share of Series B preferred stock was automatically redeemed in accordance with its terms and may not be reissued.

Note 1112 – Stock-Based Compensation

Stock Incentive Plan

We adopted the Trinity Place Holdings Inc. 2015 Stock Incentive Plan (the “SIP”), effective September 9, 2015. Prior to the adoption of the SIP, we granted restricted stock units (“RSUs”) to our executive officers and employees pursuant to individual agreements. The SIP, which has a ~~ten year~~ten-year term, authorizes (i) stock options that do not qualify as incentive stock options under Section 422 of the Code, or NQSOs, (ii) stock appreciation rights, (iii) shares of restricted and unrestricted common stock, and (iv) RSUs. The exercise price of stock options will be determined by the compensation committee, but may not be less than 100% of the fair market value of the shares of common stock on the date of grant. To date, no stock options have been granted under the SIP. The SIP ~~authorizes~~initially authorized the issuance of up to 800,000 shares of ~~our~~ common stock. In June 2019, our stockholders approved an amendment and restatement of the SIP, including an increase to the number of shares of common stock available for awards under the SIP by 1,000,000 shares, in June 2021, our stockholders approved an increase to the number of shares of common stock available for awards under the SIP by 1,500,000 shares, and in June 2023, our stockholders approved an increase to the number of shares of common stock available for awards under the SIP by 2,000,000 shares. Our SIP activity as of June 30, 2023 and December 31, 2022 was as follows:

Nine Months Ended
September 30, 2017 Year Ended December
31, 2016
Number of
Shares Weighted
Average Fair
Value at
Grant Date Number of
Shares Weighted
Average
Fair Value at
Grant Date

Balance available, beginning of period 614,500 770,000
Granted to employees (8,600 ) $ 9.13 (105,500 ) $ 5.29
Granted to non-employee directors (18,938 ) $ 6.88 (50,000 ) $ 9.85
Deferred under non-employee director's deferral program (5,643 ) $ 6.88 -
Balance available, end of period 581,319 614,500

We recognized stock-based compensation expense of approximately $42,000 and $127,000 during the three and nine months ended September 30, 2017, respectively, related to non-employee director stock grants.


	Six Months Ended			Year Ended
	June 30, 2023			December 31, 2022
		Weighted			Weighted
		Average Fair			Average Fair
	Number of	Value at		Number of	Value at
	Shares	Grant Date		Shares	Grant Date
Balance available, beginning of period	1,057,824		-	1,569,449		-
Additional shares approved by stockholders	2,000,000		-	—		-
Granted to employees	(381,760)	$	0.68	(333,500)	$	1.84
Granted to non-employee directors	(92,856)	$	0.58	(86,408)	$	1.25
Deferred under non-employee director's deferral program	(163,575)	$	0.58	(152,217)	$	1.25
Forfeitures by former employees	—		-	60,500	$	1.68
Balance available, end of period	2,419,633		-	1,057,824		-

Restricted Stock Units

We ~~have typically granted~~grant RSUs to certain ~~employees and~~ executive officers ~~each year~~and employees as part of compensation. These grants generally have vesting dates ranging from immediate vest at grant date to ~~five~~three years, with a distribution of shares at various dates ranging from the time of vesting up to ~~four~~seven years after vesting.

Shares that are forfeited are added back into the pool of shares available under the SIP, and any recorded expense related to forfeited shares are reversed in the year of forfeiture.

During the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2023, we granted ~~8,600~~381,760 RSUs to certain employees. These RSUs vest and settle ~~over~~at various times inover a two or three year period, subject to each employee’s continued employment. ~~Approximately $14,000~~During the three and ~~$49,000~~six months ended June 30, 2023 approximately $72,000 and $107,000, respectively, in ~~RSU~~stock-based compensation expense related to these shares was amortized, of which no amount and approximately $3,000, respectively, was capitalized into residential condominium units for sale with the remaining net amount recognized in the consolidated statements of operations and comprehensive loss.

Total stock-based compensation expense for the three ~~and nine~~ months ended ~~September~~June 30, ~~2017,~~2023 and 2022 totaled $114,000 and $101,000, respectively, of which no amount and approximately $4,000, respectively, was capitalized as part of residential condominium units for sale with the remaining net amount recognized in the consolidated statements of operations and comprehensive loss. Total stock-based compensation expense for the six months ended June 30, 2023 and 2022 totaled $209,000 and $252,000, respectively, of which approximately ~~$3,000~~$2,000 and ~~$15,000~~$27,000, respectively, was capitalized ~~in real estate under development for the three and nine months ended September 30, 2017, respectively.~~

Stock-based compensation expense recognized during the three and nine months ended September 30, 2017 totaled $277,000 and $831,000, respectively, which is net of $311,000 and $1.3 million, respectively, capitalized as part

Table of ~~real estate under development.~~Contents

of residential condominium units for sale with the remaining net amount recognized in the consolidated statements of operations and comprehensive loss.

Our RSU activity ~~for the nine months ended September 30, 2017~~ was as follows:

	Nine Months Ended September 30, 2017
	Number of Shares			Weighted Average Fair Value at Grant Date


						Six Months Ended			Year Ended
						June 30, 2023			December 31, 2022
							Weighted			Weighted
							Average Fair			Average Fair
						Number of	Value at Grant		Number of	Value at Grant
						Shares	Date		Shares	Date
Non-vested at beginning of period		1,621,235		$	6.38	527,999	$	1.80	551,083	$	2.14
Granted RSUs		8,600		$	9.13	381,760	$	0.68	333,500	$	1.84
Vested		(669,917	)	$	6.45	(362,176)	$	1.49	(296,084)	$	2.22
Forfeited by former employees						—	$	—	(60,500)	$	1.68
Non-vested at end of period		959,918		$	6.35	547,583	$	1.16	527,999	$	1.80

As of ~~September~~June 30, ~~2017,~~2023, there was approximately ~~$1.9 million~~$281,000 of total unrecognized compensation ~~cost~~expense related to unvested RSUs, which is expected to be recognized through December ~~2020.~~

2025.

During the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2023, we issued ~~636,355~~548,221 shares of common stock to employees and executive officers to settle vested RSUs from previous RSU grants. In connection with those transactions, we repurchased ~~339,375~~260,634 shares to provide for the employees’ withholding tax ~~liability.~~liabilities.

During the six months ended June 30, 2023, we issued 163,575 shares of immediately vested common stock to non-employee directors who received a portion of their annual compensation in shares of the Company’s common stock.

Director ~~Deferred Compensation~~Deferral Program

~~We adopted our~~Our Non-Employee Director’s Deferral Program (the “Deferral Program”) ~~on November 2, 2016. Under the Deferral Program,~~, as amended in December 2018, allows our non-employee directors ~~may~~to elect to receive the cash portion of their annual compensation in shares of the Company’s common stock, as well as to defer receipt of the portion of their annual ~~equity compensation. The non-employee directors’ annual equity~~board compensation ~~and any~~that is paid in equity. Any deferred amounts are paid under the ~~SIP.~~SIP (as is non-employee directors’ annual equity compensation that is not deferred). Compensation deferred under the Deferral Program is reflected by the grant of stock units ~~under the SIP~~ equal to the number of shares that would have been received absent a deferral election. The stock units, which are fully vested at grant, generally will be settled under the SIP for an equal number of shares of common stock within 10 days after the participant ceases to be a director. In the event that ~~the Company distributes~~we distribute dividends, each participant shall receive a number of additional stock units (including fractional stock units) equal to the quotient of (i) the aggregate amount of the dividend that the participant would have received had all outstanding stock units been shares of common stock divided by (ii) the closing price of a share of common stock on the date the dividend was issued.

~~During the nine months ended September~~As of June 30, ~~2017, 5,643~~2023, a total of 600,705 stock units ~~were~~have been deferred under the Deferral Program.

Note 1213 – ~~Investment~~Investments in ~~Our~~ Unconsolidated Joint ~~Venture~~Ventures

~~Through a wholly-owned subsidiary, we own~~We owned a 50% interest in a joint venture (the “Berkley JV”) formed to acquire and operate ~~223 North 8th Street, Brooklyn, New York,~~The Berkley, a ~~newly constructed~~ 95-unit multi-family ~~property, known as The Berkley, encompassing approximately 99,000 gross square feet. On~~property. In December 5, 2016, the ~~joint venture~~Berkley JV closed on the acquisition of The Berkley ~~through a wholly-owned special purpose entity~~ for a purchase price of $68.885 ~~million, of which $42.5 million was financed through~~million. On February 28, 2020, in connection with a ~~10-year~~refinancing, the Berkley JV repaid the acquisition loan in full and replaced it with a new 7-year, $33.0 million loan (the ~~“Loan”~~“New Berkley Loan”) ~~secured by The Berkley and the balance was paid in cash (half of~~ which ~~was funded by us). The Loan bears~~bore interest at ~~the 30-day LIBOR~~a fixed rate ~~plus 216 basis points, is~~of 2.717% and was interest only ~~for~~during the initial five ~~years, is pre-payable after two years with a 1% prepayment premium and has covenants and defaults customary for a Freddie Mac financing. Trinity~~years. We and our joint venture partner ~~are~~were joint and several recourse carve-out guarantors under the ~~Loan pursuant to Freddie Mac’s standard form~~New Berkley Loan. In October 2021, we entered into a loan agreement with our joint venture partner which was repaid in full when this property was sold in April 2022. The Berkley JV sold The Berkley in April 2022 for a sale price of ~~guaranty. The effective~~$70.8 million. In connection with the sale of the property, the Berkley JV recognized a gain on sale of approximately $9.0 million as well as a gain of $2.0 million upon settlement of the underlying interest rate swap.

We owned a 10% interest in the 250 North 10^th JV formed to acquire and operate 250 North 10^th, a 234-unit apartment building in Williamsburg, Brooklyn, New York. On January 15, 2020, the 250 North 10^th JV closed on the acquisition of

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the property for a purchase price of $137.75 million, of which $82.75 million was ~~3.40%~~financed through a 15-year mortgage loan (the “250 North 10^th Note”) secured by 250 North 10^th and the balance was paid in cash. The non-recourse 250 North 10^th Note bore interest at ~~September 30, 2017~~3.39% for the duration of the loan term and ~~2.93% at December 31, 2016.~~

~~This~~had covenants, defaults and a non-recourse carve out guaranty executed by us. Our share of the equity totaling approximately $5.9 million was funded through the Partner Loan from our joint venture ispartner. See Note 6 - Loans Payable and Secured Line of Credit – Note Payable (250 North 10^th Note) for additional information. We earned an acquisition fee at closing and were entitled to ongoing asset management fees and a ~~voting~~promote upon the achievement of certain performance hurdles. We sold our interest ~~entity. As we do not control~~in this joint venture to our joint venture partner in February 2023 resulting in net proceeds of approximately $1.2 million after repayment of our Partner Loan and release from the mortgage guaranty, and we ~~account~~realized a net gain on the sale of approximately $3.1 million.

As we did not control the 250 North 10^th JV or The Berkley JV, we accounted for itthese joint ventures under the equity method of accounting.

The combined balance sheets for the unconsolidated joint ~~venture~~ventures at ~~September~~June 30, ~~2017~~2023 and December 31, ~~2016~~2022 are as follows (in thousands):

	September 30, 2017			December 31, 2016
	(unaudited)			(unaudited)

							June 30,		December 31,
							2023		2022

ASSETS


Real estate, net	$	53,350		$	54,310		$	—	$	113,571
Cash and cash equivalents		236			77			—		1,345
Restricted cash		327			52			—		731
Tenant and other receivables, net		25			101			—		197
Prepaid expenses and other assets, net		86			169			—		2,185
Intangible assets, net		13,155			14,362			—		9,047
Total assets	$	67,179		$	69,071		$	—	$	127,076


LIABILITIES

Mortgage payable, net	$	40,911		$	40,799

Mortgages payable, net							$	—	$	80,495
Accounts payable and accrued expenses		547			403			—		1,507
Total liabilities		41,458			41,202			—		82,002

MEMBERS' EQUITY

Members' equity		27,945			28,485

MEMBERS’ EQUITY

Members’ equity								—		48,677
Accumulated deficit		(2,224	)		(616	)		—		(3,603)
Total members' equity		25,721			27,869

Total liabilities and members' equity	$	67,179		$	69,071

Our investment in unconsolidated joint venture	$	12,860		$	13,939
Total members’ equity								—		45,074

Total liabilities and members’ equity							$	—	$	127,076

Our investments in unconsolidated joint ventures							$	—	$	4,386

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The combined statements of operations for the unconsolidated joint ~~venture~~ventures through the date of sale for the three months and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 and 2022 are as follows (in thousands):

	Three Months Ended September 30, 2017			Nine Months Ended September 30, 2017
	(unaudited)			(unaudited)

							For the Three Months Ended		For the Three Months Ended		For the Six Months Ended		For the Six Months Ended
							June 30,		June 30,		June 30,		June 30,
							2023		2022		2023		2022

Revenues
Rental revenues	$	827		$	2,504		$	—	$	2,759	$	1,788	$	6,022
Other income		2			4


Total revenues		829			2,508			—		2,759		1,788		6,022


Operating Expenses
Property operating expenses		256			665			—		769		563		1,881
Real estate taxes		12			35			—		17		10		42
General and administrative		3			8			—		(12)		—		(10)
Interest expense, net		375			1,076
Transaction related costs		-			11
Amortization		446			1,338			—		493		299		1,076
Depreciation		328			983			—		762		437		1,723


Total operating expenses		1,420			4,116			—		2,029		1,309		4,712

Net loss	$	(591	)	$	(1,608	)

Our equity in net loss from unconsolidated joint venture	$	(296	)	$	(804	)

Gain on sale of real estate								—		8,981		—		8,981

Operating income								—		9,711		479		10,291

Gain on sale of interest rate swap								—		2,005		—		2,005
Interest expense								—		(782)		(483)		(1,712)
Interest expense - amortization of deferred finance costs								—		(56)		(31)		(128)
Interest (expense) income - change in fair market value of interest rate swap								—		(1,528)		—		153

Net income (loss)							$	—	$	9,350	$	(35)	$	10,609

Our equity in net (loss) income from unconsolidated joint ventures							$	—	$	4,560	$	—	$	5,306

Note 14 – Subsequent Events

In July 2023, the Company exercised its option to extend the 237 11^th Loans by one year to July 2024, and simultaneously purchased a new interest rate cap in connection with the extension.

Other than as disclosed above and elsewhere in these consolidated financial statements, there were no subsequent events requiring adjustment to, or disclosure in, the consolidated financial statements.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

~~Executive~~ Overview

Trinity Place Holdings Inc. ~~(referred~~, which we refer to ~~in this Quarterly Report on Form 10-Q~~ as “Trinity,” “we,” “our,” or ~~“us”)~~“us,” is a real estate holding, investment, development and asset management company. ~~Our business is primarily to acquire, invest in, own, manage, develop or redevelop and sell real estate assets and/or real estate related securities.~~ Our largest asset is a property located at 77 Greenwich Street in Lower Manhattan (“77 Greenwich”) ~~in Lower Manhattan. 77 Greenwich~~, which is ~~a vacant building that was demolished and is under development~~substantially complete as a mixed-use project consisting of a 90-unit residential condominium tower, ~~that also includes plans for~~ retail space and a New York City elementary school. We also own a ~~retail strip center~~105-unit, 12-story multi-family property located at 237 11^th Street in ~~West Palm Beach, Florida,~~Brooklyn, New York (“237 11^th”), as well as a property ~~formerly~~ occupied by a retail tenant in Paramus, New ~~Jersey, and, through a joint venture, a 50% interest in a newly constructed 95-unit multi-family property, known as The Berkley, located in Brooklyn, New York (see Properties~~Jersey. See “Properties” below for a more detailed description of our ~~properties). On August 4, 2017, we sold our property located in Westbury, New York for a gross sale price~~properties owned as of ~~$16.0 million. The sale resulted in a gain of $3.9 million and generated approximately $15.2 million in net proceeds to us. We continue to evaluate new investment opportunities.~~

June 30, 2023.

Liquidity and Going Concern; Management’s Plans; Recent Developments

The ~~predecessor~~COVID-19 pandemic and related matters, including government actions, shifts in residential consumer sentiment and changes to ~~Trinity~~the broader and local economies, had a significant adverse impact on our business. More recently, the economic downturn, increased interest rates and high inflation have also impacted our business. While we believe many of these trends will reverse or stabilize, and the New York City economy and residential real estate markets have generally seen continued improvement in 2022 and to date in 2023, given our focus on New York City residential real estate, our business has been particularly impacted. As of June 30, 2023, we had total cash and restricted cash of $15.4 million, of which approximately $4.4 million was cash and cash equivalents and approximately $11.0 million was restricted cash. The Company’s cash and cash equivalents will not be sufficient to fund the Company’s operations, debt service, amortization and maturities and corporate expenses over the next 12 months, unless we are able to extend or refinance our maturing debt and raise additional capital, creating substantial doubt about our ability to continue as a going concern. Management is ~~Syms Corp. (“Syms”). Syms~~exploring opportunities to secure additional funding through the sale of assets, refinancings of outstanding indebtedness, and ~~its subsidiaries filed voluntary petitions for relief under Chapter 11~~equity or debt financings or other sources. The Company also continues to explore a range of strategic and financing alternatives to maximize stockholder value, and to engage with parties that have expressed interest in the ~~United States Bankruptcy Court~~Company’s attributes and assets and may see the Company as a potential vehicle for growth, with potential opportunities to recapitalize the Company at a lower cost of capital. The Company has engaged Houlihan Lokey and Ackman-Ziff to act as advisors (our “Advisors”) in connection with our strategic review process and to assist us in identifying and evaluating potential alternatives. Potential strategic alternatives that are being evaluated include securing an equity and/or debt financing of the Company, refinancing of existing debt, and/or a sale or merger or reverse merger of the Company. In April 2023, the Company reached an agreement with its CCF lender regarding, among other things, the deferment of cash interest payments and a $7 million prepayment until August 31, 2023, subject to extension in certain circumstances, which also provided that the Company will enter into a strategic transaction that results in the repayment of the CCF or prepay the CCF by $5 million from equity proceeds by such date. In addition, effective in April 2023, the Company’s subsidiary borrower under the secured line of credit entered into an amendment to that agreement extending the maturity date to March 22, 2024 and reducing the interest rate to 2.5% until such date. In July 2023, the Company exercised its first extension option for the District of Delaware (the “Court”) in 2011. In August 2012, the Court entered an order confirming the Syms Plan of Reorganization (the “Plan”). In September 2012, the Plan became effective and Syms and its subsidiaries consummated their reorganization under Chapter237 11 through a series of transactions contemplated by the Plan and emerged from bankruptcy. As part of those transactions, reorganized Syms merged with and into Trinity, with Trinity as the surviving corporation and successor issuer pursuant to Rule 12g-3 under the Exchange Act. On or about March 8, 2016, a General Unsecured Claim Satisfaction occurred under the Plan. On March 14, 2016, we made the final Majority Shareholder payment^th Loans (as defined inbelow) which extended the ~~Plan) to the former Majority Shareholder in the amount of approximately $6.9 million. Together these satisfied our remaining payment and reserve obligations under the Plan.~~

~~From the effective~~maturity date of the ~~Plan~~debt to July 2024. Given the current financial market challenges and a slowdown in ~~2012~~lending and other transactions, there can be no assurance that we will be able to enter into a strategic transaction or prepay the CCF by the agreed-upon date, or that our cash position will extend through ~~the~~that date ~~the General Unsecured Claims Satisfaction occurred,~~or that we will be able to enter into any future extensions, amendments or waivers with these or other lenders, raise additional capital, refinance indebtedness or enter into other financing arrangements or engage in asset sales or strategic partnerships sufficient to fund our cash needs, on terms satisfactory to us, if at all. We are also evaluating additional alternatives in restructuring our business ~~plan was historically focused on the monetization~~and our capital structure, including but not limited to filing for bankruptcy protection or seeking an out-of-court restructuring of our ~~commercial~~liabilities. See Part I. Item 1A. Risk Factors to our 2022 Annual Report on Form 10-K for further information.

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While construction at 77 Greenwich has taken longer than projected and the impact of the pandemic and broader economic conditions have impeded the sale of residential condominium units at 77 Greenwich, we continue to sign and close contracts for our residential condominium units, including seven units since December 31, 2022, for a total of 35 units as of June 30, 2023 and two units since June 30, 2023. The units that remain available to be sold are larger, higher floor units. The substantial majority of the construction is completed with exterior punch-list work, the 42^nd floor roof deck and the 12^th floor terrace expected to be completed within the next few months. Following the failure of Silicon Valley Bank in March 2023 and subsequent additional bank failures and related stresses, the pace of signing and closing contracts on residential condominium units has slowed markedly, with one contract being closed since that time period. Although we anticipate the pace will normalize in the near term in light of historical trends, predictions are inherently uncertain and there can be no assurances that it will do so in the near term or at all.

Properties

Below is certain information regarding our real estate properties as of June 30, 2023:


		Building Size
		(estimated		Leased at
		rentable	Number of	June 30,
Property Location	Type of Property	square feet)	Units	2023
Owned Locations

77 Greenwich, New York, New York (1)	Residential condominium units for sale	—	—	N/A

Paramus, New Jersey (2)	Retail	77,000	—	94.8	%

237 11^th Street, Brooklyn, New York (3)	Multi-family	80,000	105	98.1	%

Total		157,000	105

(1) 77 Greenwich. We are nearing completion of an over 300,000 gross square foot mixed-use building that corresponds to the approximate total of 233,000 zoning square feet. The property consists of 90 luxury residential condominium apartments, 7,500 square feet of retail space, almost all of which is street level, a 476-seat elementary school serving New York City District 2, including the ~~development of 77 Greenwich, and the payment of approved claims in accordance with the terms~~adaptive reuse of the ~~Plan. During the period from the effective date~~landmarked Robert and Anne Dickey House. As of March 3, 2023, we had received our temporary certificates of occupancy (“TCOs”) for 100% of the ~~Plan~~condominium units, lobby, Cloud Club (lounge, terrace, game room, dining room, kitchen and kids play room), mechanical rooms, and portions of the cellar (including the bike and storage rooms.) We have closed on the sale of 35 residential condominium units through March 8, 2016, we sold 14 properties and paid approximately $116.8 million for approved claims. These payments reflect cumulative improvements of approximately $11.5 million in respect of all claim payments madeJune 30, 2023, with 55 remaining units to date as compared with amounts initially estimated. As of September 30, 2017, the amount of remaining multiemployer pension plan claims was $1.9 million (see Note 7 – Pension and Profit Sharing Plans to the condensed consolidated financial statements). In addition, we had other pension liabilities of $2.9 millionsell as of ~~September~~June 30, ~~2017.~~2023, and closed on the sale of two additional units since June 30, 2023.

On February 14, 2017, we issued an aggregate of 3,585,000 shares of common stock in a private placement at a purchase price of $7.50 per share, and received gross proceeds of $26.9 million. On April 5, 2017, we issued an aggregate of 1,884,564 shares of common stock in a rights offering at a purchase price of $7.50 per share and received gross proceeds of $14.1 million (the “Rights Offering”). We anticipate using the proceeds from the private placement and the Rights Offering for the development of 77 Greenwich, potential new real estate acquisitions and investment opportunities and for working capital.

~~On September 8, 2017, a wholly-owned subsidiary of ours~~ entered into an agreement with the New York City School Construction Authority (the “SCA”), whereby we constructed a school sold to the SCA as part of our condominium development at 77 Greenwich. Pursuant to the agreement, the SCA agreed to pay us $41.5 million for the purchase of their condominium unit and reimburse us for the costs associated with constructing the school, including a construction supervision fee of approximately $5.0 million. Payments for construction are being made by the SCA to the general contractor in installments as construction on their condominium unit progresses. Payments to us for the land and construction supervision fee commenced in January 2018 and continued through October 2019 for the land and will continue through completion of the SCA buildout for the construction supervision fee. An aggregate of $46.3 million had been paid to us by the SCA as of June 30, 2023 with approximately $208,000 remaining to be paid. We have also received an aggregate of $55.4 million in reimbursable construction costs from the SCA through June 30, 2023. In April 2020, the SCA closed on the purchase of the school condominium unit from us, at which point title transferred to the SCA. The SCA has completed the buildout of the interior space, which is a public elementary school with approximately 476 seats. The school received its final TCO and opened to students in September 2022.

Due to the Company's core business of investing in, developing and operating real estate assets, there is an inherent risk that the development and sales of residential condominiums may be subject to unknown potential changes in internal and external financial and economic conditions, such as inflation and rising interest rates, and general market conditions, which could impact the Company's business and potential buyers of the residential condominiums for sale.

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The Company believes it is possible to incur real estate impairment charges in the future in the event these conditions deteriorate

(2) Paramus Property. The Paramus property consists of a one-story and partial two-story, 73,000 square foot freestanding building and an outparcel building of approximately 4,000 square feet, for approximately 77,000 total square feet of rentable space. The primary building is comprised of approximately 47,000 square feet of ground floor space, and two separate mezzanine levels of approximately 21,000 and 5,000 square feet. The 73,000 square foot building is leased to Restoration Hardware Holdings, Inc. (NYSE: RH) pursuant to a license agreement that began on June 1, 2016, is terminable upon three months’ notice, and currently is scheduled to end on March 31, 2024. The outparcel building was leased to a long-term tenant whose lease expired on March 31, 2023 and elected not to renew its lease. The land area of the Paramus property consists of approximately 292,000 square feet, or approximately 6.7 acres.

The Paramus property had been under contract for sale pursuant to a purchase and sale agreement, which itwas subject to site plan approval. The agreement was terminated by the buyer in January 2023. We are currently exploring options with respect to the Paramus property, including development, redevelopment or sale, among others.

(3) 237 11^th Street.In 2018, we acquired ~~an option to purchase~~ a ~~newly built~~ 105-unit, ~~12 story~~12-story multi-family apartment building encompassing approximately 93,000 gross square feet (approximately 80,000 rentable square feet) located at 237 ~~11th~~11^th Street, Park Slope, Brooklyn, New York for a purchase price of ~~$81.0~~$81.2 million, excluding transaction costs of approximately $0.7 million. ~~Under~~The property also includes 6,264 square feet of retail space, all of which is leased to Starbucks Inc. (NQGS:SBUX), an oral surgeon and a health and wellness tenant. Located on the ~~agreement, we~~border of the Park Slope and Gowanus neighborhoods of Brooklyn, the property is located one block from the 4th Avenue/9th Street subway station. The 237 11^th property offers an array of modern amenities that surpass what is available in the neighborhood’s “brownstone” housing stock. The property also benefits from a 15-year Section 421-a real estate tax exemption. Although all apartments are ~~entitled~~market rate units, they are subject to ~~exercise the option~~New York City’s rent stabilization law during the ~~period commencing on February 1, 2018 and expiring on February 28, 2018. We paid an initial deposit~~remaining term of ~~$8.1 million upon entering into~~ the ~~agreement, which is nonrefundable if we do not exercise~~Section 421-a real estate tax exemption. Due to the ~~option. The purchase price will be funded through acquisition financing and cash on hand. The acquisition~~approval of the Gowanus up-zoning, this property benefitted to the extent of approximately 30,000 square feet of air rights.

Due to water damage in apartment units and other property at 237 11^th resulting from construction defects which ~~is subject~~we believe were concealed by the prior ownership team and its contractor, we submitted a notice of claim to ~~customary closing conditions, is expected~~our insurance carrier for property damage and business interruption (lost revenue) in September 2018. The insurance carrier subsequently disclaimed coverage for the losses and we filed a complaint against the carrier alleging that it breached the insurance policy by denying coverage. We also filed legal claims against the seller, its parent company, and the general contractor to ~~close~~recover damages arising from defective construction of the building, including defects that resulted in water damage as well as other defects. In addition, the ~~first quarter of 2018.~~

~~Properties~~

~~The table below provides information~~general contractor impleaded into that litigation several subcontractors who performed work on the ~~properties we owned~~property. Management expects to recover some portion of the cost incurred to repair the property through the litigations and/or settlement negotiations with the seller, its parent company, the general contractor, the subcontractors, and the insurance carrier, although the amount of damages that may be recoverable in litigation and/or potential settlement negotiations are uncertain at this time, as is the timing of receipt of any such payments. We continue to pursue all legal remedies. We incurred significant cash outflows for costs associated with these repairs and remediation, which commenced in September ~~30, 2017:~~

Property Location Type of Property Building Size
(estimated
rentable
square feet) Number
of Units Leased at
September
30, 2017 Occupancy
at
September
30, 2017 Occupancy
at
September
30, 2016

Owned Locations

New York, New York (77 Greenwich) (1) Property under development 57,000 - N/A N/A N/A

Paramus, New Jersey (2) Property under development 77,000 - - 100.0 % 5.2 %

West Palm Beach, Florida (3) Retail 112,000 - 68.9 % 68.9 % 67.8 %

Total Owned Square Feet 246,000

Joint Venture

223 North 8th Street, Brooklyn, New York - 50% (4) Multi-family 65,000 95 94.7 % 94.7 % -

Grand Total Square Feet 311,000

~~(1)~~

~~77 Greenwich.~~The 77 Greenwich property consisted of a vacant six-story commercial building of approximately 57,000 square feet, yielding approximately 173,000 square feet of zoning floor area as-of-right. We also have ownership of approximately 60,000 square feet of development rights from adjacent tax lots, one of which is owned in fee by us and has a 4-story landmark building. We are currently in the development stage for the development of an over 300,000 gross square foot mixed-use building that corresponds to the approximate total of 233,000 zoning square feet as described above. The plans call for approximately 90 luxury residential condominiums and 7,600 square feet of retail space on Greenwich Street, as well as a 476-seat elementary school serving New York City District 2. The school project has obtained city council and mayoral approval. Environmental remediation and demolition was2019 and were completed in the third quarter of 2017, and excavation and foundation work has begun. The 77 Greenwich Loan, which was scheduled to mature on August 8, 2017, was extended to mature on February 8, 2018. We are evaluating our options with respect to the 77 Greenwich Loan, which include, among others, refinancing the 77 Greenwich Loan as part of a construction loan.

~~(2)~~

~~Paramus Property.~~ The Paramus property consists of a one-story and partial two-story, 73,000 square foot freestanding building and an outparcel building of approximately 4,000 square feet, for approximately 77,000 total square feet of rentable space. The primary building is comprised of approximately 47,000 square feet of ground floor space, and two separate mezzanine levels of approximately 21,000 and 5,000 square feet. The 73,000 square foot building was occupied pursuant to a short-term license agreement to Restoration Hardware Holdings, Inc. (NYSE: RH) (“Restoration Hardware”) from October 15, 2015 to February 29, 2016 when the tenant vacated the property. Subsequently, we entered into a new twelve month license agreement with Restoration Hardware that began on June 1, 2016, which is terminable upon one month’s notice to the other party, which has since been extended to end on March 31, 2018. The outparcel building is leased to a tenant whose lease expires on March 31, 2018. The tenant has been in the space since 1996. The land area of the Paramus property consists of approximately 292,000 square feet, or approximately 6.7 acres. We have entered into an option agreement with Carmax (NYSE:KMX) who will construct a new building after we obtain approvals and demolish the existing buildings. The option agreement includes a fully negotiated ground lease agreement. This transaction is subject to town approvals.

~~(3)~~

~~West Palm Beach Property.~~ The West Palm Beach property consists of a one-story neighborhood retail strip center that is comprised of approximately 112,000 square feet of rentable area, which includes three outparcel locations with approximately 11,000 combined square feet. The land area of the West Palm Beach property consists of approximately 515,000 square feet, or approximately 11.8 acres. Our redevelopment and repositioning of the center was completed in 2016. We will incur additional lease-up costs as the current vacancies are filled. Our two largest tenants are Walmart Marketplace, with 41,662 square feet of space and Tire Kingdom, a national credit tenant with a 5,400 square feet outparcel.

~~(4)~~

~~223 North 8~~^th ~~Street.~~ Through a joint venture with Pacolet Milliken Enterprises, Inc., we own a 50% interest in the entity formed to acquire and operate The Berkley, a newly constructed 95-unit multi-family property encompassing approximately 99,000 gross square feet (65,000 rentable square feet) on 223 North 8th Street in North Williamsburg, Brooklyn, New York. The Berkley is in close proximity to public transportation and offers a full amenity package. Apartments feature top-of-the-line unit finishes, central air conditioning and heating and most units have private outdoor space. The property has a 25-year 421a real estate tax abatement.

~~Lease Expirations~~

~~The following chart shows the tenancy, by year of lease expiration, of our retail properties for all tenants in place~~ as of ~~September~~December 31, 2021.

Lease Expirations

As of June 30, ~~2017, excluding~~2023, we have one retail lease at our Paramus property with 73,000 square feet of leased space with annualized rent of $516,000 per year. The lease of the ~~license agreement with Restoration Hardware~~outparcel building expired in March 2023, and the lease for the primary building expires in March 2024. We also have a retail lease at the ~~Paramus, New Jersey~~ 237 11^thproperty with 2,006 square feet of leased space with annualized rent of $130,000 per year that expires in 2027, a second retail lease at the 237 11^thproperty with 1,074 square feet of leased space with average annualized rent of $94,506 per year that expires in 2036 and a ~~pop-up store~~third retail lease at the ~~West Palm Beach, Florida~~ 237 11^thproperty ~~(dollars~~with 2,208 square feet of leased space with average annualized rent of $153,366 per year that expires in ~~thousands):~~2032. We also have a retail lease at 77 Greenwich with 1,061 square feet of leased space with an average annualized rent of $88,085 per year that expires in 2032. All our other leases are residential leases most of which expire within twelve or twenty-four months of the commencement date.

Number of
Tenants Leased Square
Feet by Year of
Expiration Annualized
Rent in Year of
Expiration (A)

2017 (B) 2 2,400 $ 29
2018 1 4,000 140
2019 - - -
2020 8 12,488 245
2021 2 7,063 119
Thereafter 6 55,462 1,121
19 81,413 $ 1,654

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~~(A)~~

~~This is calculated by multiplying the rent in the final month of the lease by 12.~~

~~(B)~~

~~Reflects tenants with a month-to-month tenancy.~~

Critical Accounting Policies and Estimates

Management’s discussion and analysis of financial condition and results of operations is based upon our ~~condensed~~ consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). The preparation of financial statements in conformity with GAAP requires the use of estimates and assumptions that could affect the reported amounts in our ~~condensed~~ consolidated financial statements. Actual results could differ from these estimates. A summary of ~~the~~our significant accounting policies that management believes are critical to the preparation of the ~~condensed~~ consolidated financial statements are included in this report (see Note 2 - Summary of Significant Accounting Policies - Basis of Presentation to our ~~condensed~~ consolidated financial ~~statements)~~statements for further information). Certain of the accounting policies used in the preparation of these ~~condensed~~ consolidated financial statements are particularly important for an understanding of the financial position and results of operations presented in the historical ~~condensed~~ consolidated financial statements included in this report and require the application of significant judgment by management and, as a result, are subject to a degree of uncertainty. We believe there have been no material changes to the items that we disclosed as our critical accounting policies under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our ~~2016~~2022 Annual Report on Form 10-K (the ~~“2016~~“2022 Annual Report”) for the year ended December 31, ~~2016.~~

2022.

The following discussion and analysis is intended to assist readers in understanding our financial condition and results of operations during the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 and ~~September 30, 2016~~2022 and should be read in conjunction with the ~~condensed~~ consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q and our ~~2016~~2022 Annual Report.

These results include revenues and expenses from the Westbury, New York property as of May 8, 2017 when the property was classified as an asset held for sale through its date of sale on August 4, 2017. In prior periods, this property’s revenues and expenses were capitalized as the property was considered as real estate under development.

Results of Operations for the Three Months Ended ~~September~~June 30, ~~2017~~2023 Compared to the Three Months Ended ~~September~~June 30, ~~2016~~

2022

Rental revenues in total increased by ~~$8,000~~approximately $194,000 to ~~$336,000~~$1.4 million for three months ended June 30, 2023 from $1.2 million for the three months ended ~~September~~June 30, ~~2017 from $328,000~~2022. This consisted of an increase in rent revenues of approximately $208,000 to $1.4 million for the three months ended ~~September~~June 30, ~~2016. The increase in rental revenues was mainly due to increased tenancy at the West Palm Beach, Florida property as well as revenues~~2023 from ~~the Westbury, New York property, partially offset by a non-cash rent adjustment for a tenant at the West Palm Beach, Florida property. Tenant reimbursements decreased by $37,000 to $171,000~~$1.2 million for the three months ended ~~September~~June 30, ~~2017 from $208,000~~2022, as well as a decrease in tenant reimbursements of approximately $14,000 to $33,000 for the three months ended ~~September~~June 30, ~~2016.~~2023 from $47,000 for the three months ended June 30, 2022. The ~~decrease~~increase in ~~tenant reimbursements~~total rental revenues and its related components was ~~mainly~~ due to higher occupancy, higher base rents and fewer rent concessions at 237 11^th during the ~~sale~~three months ended June 30, 2023 compared to the three months ended June 30, 2022 due to completion of remediation of the ~~Westbury, New York property~~construction related defects.

Other income increased by approximately $14,000 to $24,000 for the three months ended June 30, 2023 from $10,000 for the three months ended June 30, 2022. This increase is due to a slight increase in the SCA’s construction supervision fee.

Sales of residential condominium units at 77 Greenwich increased by approximately $106,000 to $5.2 million for the three months ended June 30, 2023 from $5.1 million for the three months ended June 30, 2022. We closed on ~~August 4, 2017.~~two residential condominium units during the three months ended June 30, 2023 and 2022, respectively. Units that we closed during 2022 were generally lower priced, smaller units on the building’s lower floors, many of which entered into contract during the height of the pandemic.

Property operating expenses increased by ~~$34,000~~approximately $45,000 to ~~$178,000~~$811,000 for the three months ended ~~September~~June 30, ~~2017~~2023 from ~~$144,000~~$766,000 for the three months ended ~~September~~June 30, ~~2016. These amounts~~2022. The increase was principally due less capitalized operating costs associated with 77 Greenwich during the three months ended June 30, 2023 compared to the three months ended June 30, 2022. Property operating expenses consisted primarily of ~~costs~~expenses incurred for ~~maintenance and repairs,~~ utilities, payroll, COVID-19 related supplies and general operating expenses ~~at our West Palm Beach, Florida property~~ as well as ~~from~~repairs and maintenance and leasing commission at 237 11^th, general operating expenses at 77 Greenwich, including marketing costs, and to a lesser extent expenses related to the ~~Westbury,~~Paramus, New ~~York~~Jersey property.

Real estate tax expense increased by ~~$61,000~~approximately $35,000 to ~~$124,000~~$451,000 for the three months ended ~~September~~June 30, ~~2017~~2023 from ~~$63,000~~$416,000 for the three months ended ~~September~~June 30, ~~2016. The~~2022. This increase ~~related~~was mainly due to ~~increased~~less capitalized real estate ~~taxes at~~tax expenses for 77 Greenwich for the ~~West Palm Beach, Florida property~~three months ended June 30, 2023 as ~~well as from~~compare to the ~~real estate taxes at Westbury, New York property.~~

three months ended June 30, 2022.

General and administrative expenses ~~were essentially flat~~increased by approximately $332,000 to $1.8 million for the three months ended ~~September~~June 30, ~~2017 as compared to~~2023 from $1.5 million for the three months ended ~~September~~June 30, ~~2016, at approximately $1.5 million.~~2022. For the three months ended ~~September~~June 30, ~~2017, of this amount,~~2023, approximately ~~$277,000~~$114,000 related to stock-based compensation, ~~$479,000~~$651,000 related to payroll and payroll related expenses, ~~$389,000~~$456,000 related to other corporate ~~costs,~~expenses, including board fees, corporate office rent and insurance and ~~$364,000~~ $614,000

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related to legal, accounting and other professional fees. For the three months ended ~~September~~June 30, ~~2016, of this amount,~~2022, approximately ~~$446,000~~$97,000 related to stock-based compensation, ~~$392,000~~$698,000 related to payroll and payroll related ~~costs, $321,000~~expenses, $348,000 related to other corporate ~~costs~~expenses, including board fees, corporate office rent and insurance and ~~$370,000~~$360,000 related to legal, accounting and other professional fees.

~~Transaction~~Pension related costs ~~decreased by $40,000 to $9,000~~remained relatively flat at $143,000 for the three months ended ~~September~~June 30, ~~2017 from $49,000~~2023 compared to $157,000 for the three months ended ~~September~~June 30, ~~2016.~~2022. These costs represent professional fees and other periodic pension costs incurred in connection with ~~formation activities and~~ the ~~underwriting and evaluation~~legacy Syms Pension Plan (see Note 8 – Pension Plan to our consolidated financial statements for further information).

Cost of ~~potential acquisitions and investments for deals that were not consummated.~~

~~Depreciation and amortization expense~~sales – residential condominium units increased by approximately ~~$24,000~~$366,000 to $145,000 for the three months ended September 30, 2017 from $121,000 for the three months ended September 30, 2016. For the three months ended September 30, 2017, approximately $61,000 related to depreciation for the West Palm Beach, Florida property, and $84,000 related to the amortization of trademarks and lease commissions. Of the $121,000 for the three months ended September 30, 2016, approximately $29,000 related to depreciation for the West Palm Beach, Florida property and approximately $92,000 related to amortization of trademarks and lease commissions.

Write-off of costs for the three months ended September 30, 2017 relating to demolished asset was approximately $3.4 million. This is related to the 77 Greenwich property’s acceleration of depreciation of the building and building improvements and demolition costs at 77 Greenwich due to the completion of demolition of the 57,000 square foot six-story commercial building.

~~Operating loss increased by approximately $3.5 million to $4.9~~$5.2 million for the three months ended ~~September~~June 30, ~~2017~~2023 from ~~$1.4~~$4.8 million for the three months ended ~~September~~June 30, ~~2016~~2022. We closed on two residential condominium units during the three months ended June 30, 2023 and 2022, respectively. Cost of sales consists of construction and capitalized operating costs that are allocated to the respective condominium units being sold, as ~~a result~~well as closing costs of the ~~changes in revenues~~residential condominium units. Units that we closed during 2022 were generally lower priced, smaller units on the building’s lower floors, many of which entered into contract during the height of the pandemic.

Depreciation and ~~operating expenses as described above.~~

~~Equity in net loss from unconsolidated joint venture~~amortization remained flat at $1.0 million for the three months ended ~~September~~June 30, ~~2017~~2023 and 2022, respectively. For the three months ended June 30, 2023, depreciation and amortization expense consisted of depreciation for the Paramus, New Jersey property of approximately $283,000, depreciation for 237 11^th of approximately $414,000, the amortization of lease commissions and acquired in-place leases of approximately $192,000 for 237 11^th, and amortization of warrants for $114,000. For the three months ended June 30, 2022, depreciation and amortization expense consisted of depreciation for the Paramus, New Jersey property of approximately $287,000, depreciation for 237 11^th of approximately $410,000, the amortization of lease commissions and acquired in-place leases of approximately $193,000 for 237 11^th, and amortization of warrants of approximately $114,000.

Equity in net income from unconsolidated joint ventures was ~~approximately $296,000. This amount represents~~$70,000 for the three months ended June 30, 2022. Equity in net income from unconsolidated joint ventures represented our 10% share in 250 North 10^th, which was sold in February 2023, and our 50% share in The Berkley, which was sold in April 2022. For the ~~joint venture of the newly constructed 95-unit multi-family property in Brooklyn, New York purchased on December 5, 2016. Our~~three months ended June 30, 2022, our share of the ~~loss~~net income is primarily comprised of operating income before depreciation of ~~$279,000~~$170,000 offset by depreciation and amortization of ~~$387,000 and~~$195,000, interest expense of ~~$188,000.~~$105,000, loss from the change in the fair market value of the interest rate swap of $803,000 and a gain on the settlement of the interest rate swap of $1.0 million upon the sale of The Berkley in April 2022.

Equity in net gain on sale of unconsolidated joint venture property represents the sale of The Berkley in April 2022 for a sale price of $70.8 million. In connection with the sale of the property, our share of the gain was approximately $4.5 million.

~~Interest income, net,~~Unrealized loss on warrants increased by approximately ~~$32,000~~$1.3 million to ~~$20,000~~$10,000 for the three months ended ~~September~~June 30, ~~2017~~2023 from ~~interest expense, net~~a gain of $12,000 for the three months ended September 30, 2016. For the three months ended September 30, 2017, $644,000 related to gross interest incurred offset by $562,000 of capitalized interest and $102,000 of interest income. For the three months ended September 30, 2016, $553,000 related to gross interest incurred offset by $486,000 of capitalized interest and $55,000 of interest income. The increase in interest income, net, for the three months ended September 30, 2017 of $32,000 is primarily attributable to the overall increase in interest income on our average daily cash balance of approximately $43.5$1.3 million for the three months ended ~~September~~June 30, ~~2017 as compared~~2022. This represents the change in the fair market valuation of the warrants due mainly to the change in our stock price on the measurement date.

Interest expense, net increased by approximately ~~$26.8~~$3.9 million to $7.2 million for the three months ended ~~September~~June 30, ~~2016, partially offset by~~2023 from $3.3 million for the three months ended June 30, 2022. For the three months ended June 30, 2023, there was approximately $7.2 million of gross interest expense incurred and no amounts were capitalized into residential condominium units for sale. For the three months ended June 30, 2022, there was approximately $4.5 million of gross interest expense incurred, $1.2 million of which was capitalized into residential condominium units for sale. The increase in gross interest expense was mainly due to higher overall interest rates on ~~the WPB Loan (see Note 5 – Loans Payable and Secured Line of Credit – to~~ our ~~condensed consolidated financial statements) and interest rate increases period over period.~~loans after June 30, 2022.

~~Amortization~~Interest expense - amortization of deferred finance costs increased by approximately ~~$106,000~~$555,000 to ~~$145,000~~$933,000 for the three months ended ~~September~~June 30, ~~2017~~2023 from ~~$39,000~~$378,000 for the three months ended ~~September~~June 30, ~~2016. For the three months ended September 30, 2017, $264,000 related~~2022. The increase was principally due to less capitalized amortization of finance costs ~~related to obtaining the~~for our loans ~~encumbering 77 Greenwich, the West Palm Beach, Florida property and the lines~~as part of credit partially offset by $119,000 of costs capitalized to real estate under development. For the three months ended September 30, 2016, $125,000 related to amortization of costs related to obtaining the loans encumbering 77 Greenwich and the West Palm Beach, Florida property partially offset by $86,000 of costs capitalized to real estate under development.

~~Gain on sale from real estate~~residential condominium units for the three months ended September 30, 2017 was approximately $3.9 million due to the sale of the Westbury, New York property on August 4, 2017 which generated approximately $15.2 million in net proceeds. No properties were sold during the same period last year.

sale.

We recorded noa $51,000 tax expense for the three months ended ~~September~~June 30, ~~2017 and September~~2023 compared to $120,000 for the three months ended June 30, ~~2016, respectively.~~2022.

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Net loss ~~available~~attributable to common stockholders increased by approximately ~~$29,000~~$10.7 million to ~~$1.5~~$10.9 million for the three months ended ~~September~~June 30, ~~2017~~2023 from ~~$1.4 million~~$223,000 for the three months ended ~~September~~June 30, ~~2016.~~2022. This is a result of the changes discussed above, principally due to the increased net interest expense, amortization of deferred finance costs and increased operating and interest expenses at 77 Greenwich, as well as the gain on the sale of our joint venture in 2022.

Results of Operations for the ~~Nine months~~Six Months Ended ~~September~~June 30, ~~2017~~2023 Compared to the ~~Nine months~~Six Months Ended ~~September~~June 30, ~~2016~~

2022

Rental revenues in total increased by ~~$43,000~~approximately $445,000 to ~~$1.0~~$2.9 million for six months ended June 30, 2023 from $2.5 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017 from $974,000~~2022. This consisted of an increase in rent revenues of approximately $423,000 to $2.8 million for the ~~nine~~six months ended ~~September~~June 30, ~~2016. The increase in rental revenues was mainly due to~~2023 from $2.4 million for the ~~increased tenancy at the West Palm Beach, Florida property~~six months ended June 30, 2022, as well as revenues at the Westbury, New York property, partially offset by a non-cash rent adjustment for a tenant at the West Palm Beach, Florida property. Tenant reimbursements increased by $10,000 to $445,000 for the nine months ended September 30, 2017 from $435,000 for the nine months ended September 30, 2016. Thean increase in tenant reimbursements of approximately $22,000 to $112,000 for the six months ended June 30, 2023 from $90,000 for the six months ended June 30, 2022. The increase in total rental revenues and its related components was ~~mainly~~ due to higher occupancy, higher base rents and fewer rent concessions at 237 11^th during the six months ended June 30, 2023 compared to the six months ended June 30, 2022 due to completion of remediation of the construction related defects.

Other income increased ~~tenancy at~~by approximately $118,000 to $144,000 for the ~~West Palm Beach, Florida~~six months ended June 30, 2023 from $26,000 for the six months ended June 30, 2022. This increase is due to a contractual payment received as a result of the cancelation of the purchase and sale agreement for the Paramus, New Jersey property in January 2023, as well as ~~revenues~~a slight increase in the SCA’s construction supervision fee.

Sales of residential condominium units at 77 Greenwich increased by approximately $7.1 million to $18.3 million for the ~~Westbury, New York property, partially offset by~~six months ended June 30, 2023 from $11.2 million for the ~~catch-up~~six months ended June 30, 2022. We closed on seven and five residential condominium units during the six months ended June 30, 2023 and 2022, respectively. Units that we closed during 2022 were generally lower priced, smaller units on the building’s lower floors, many of ~~real estate tax recoveries in 2016 for certain tenants whose leases commenced in 2015.~~which entered into contract during the height of the pandemic.

Property operating expenses increased by ~~$104,000~~approximately $508,000 to ~~$549,000~~$2.1 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 from ~~$445,000~~$1.6 million for the ~~nine~~six months ended ~~September~~June 30, ~~2016. These amounts~~2022. The increase was principally due to increased legal expenses associated with the ongoing legal claims against the seller of the property at 237 11^th, as well as less capitalized operating costs associated with 77 Greenwich during the six months ended June 30, 2023 compared to the six months ended June 30, 2022. Property operating expenses consisted primarily of ~~costs~~expenses incurred for ~~maintenance and repairs,~~ utilities, payroll, COVID-19 related supplies and general operating expenses as well as repairs and maintenance and leasing commission at ~~our West Palm Beach, Florida property~~237 11^th, general operating expenses at 77 Greenwich, including marketing costs, and ~~the Westbury, New York property. The increase was mainly due~~to a lesser extent expenses related to the ~~increased tenancy at the West Palm Beach, Florida property and the Westbury,~~Paramus, New ~~York~~Jersey property.

Real estate tax expense increased by ~~$178,000~~approximately $108,000 to ~~$345,000~~$914,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 from ~~$167,000~~$806,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2016. The~~2022. This increase ~~related~~was mainly due to ~~increased~~less capitalized real estate ~~taxes at~~tax expenses for 77 Greenwich for the ~~West Palm Beach, Florida property and~~six months ended June 30, 2023 as compare to the ~~Westbury, New York property.~~

six months ended June 30, 2022.

General and administrative expenses ~~decreased~~increased by approximately ~~$1.1~~$274,000 to $3.3 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 from ~~approximately $5.3~~$3.0 million for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~2022. For the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2023, approximately ~~$831,000~~$208,000 related to stock-based compensation, $1.3 million related to payroll and payroll related expenses, $869,000 related to other corporate expenses, including board fees, corporate office rent and insurance and $903,000 related to legal, accounting and other professional fees. For the six months ended June 30, 2022, approximately $225,000 related to stock-based compensation, $1.4 million related to payroll and payroll related expenses, ~~$1.2 million~~$650,000 related to other corporate ~~costs~~expenses, including board fees, corporate office rent and insurance and ~~$798,000~~$681,000 related to legal, accounting and other professional fees. ~~For~~

Pension related costs increased by approximately $28,000 to $287,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2016, approximately $1.9 million related~~2023 compared to stock-based compensation, $1.2 million related to payroll and payroll related costs, $1.1 million related to other corporate costs including board fees, corporate office rent and insurance and $1.1 million related to legal, accounting and other professional fees. The overall decrease of approximately $1.1 million is mainly a result of a $1.1 million reduction in stock-based compensation related to restricted stock units (“RSUs”) that were granted in the first quarter of 2016, including grants of 99,000 RSUs that vested immediately.

~~Transaction related costs decreased by $22,000 to $77,000~~$315,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2017 from $99,000 for the nine months ended September 30, 2016.~~2022. These costs represent professional fees and other periodic pension costs incurred in connection with ~~formation activities~~the legacy Syms Pension Plan (see Note 8 – Pension Plan to our consolidated financial statements for further information).

Cost of sales – residential condominium units increased by approximately $7.0 million to $17.5 million for the six months ended June 30, 2023 from $10.5 million for the six months ended June 30, 2022. We closed on seven and five residential condominium units during the ~~underwriting~~six months ended June 30, 2023 and ~~evaluation~~2022, respectively. Cost of ~~potential acquisitions~~sales consists of

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construction and ~~investments for deals~~capitalized operating costs that are allocated to the respective condominium units being sold, as well as closing costs of the residential condominium units. Units that we closed during 2022 were ~~not consummated.~~generally lower priced, smaller units on the building’s lower floors, many of which entered into contract during the height of the pandemic.

Depreciation and amortization ~~expense increased by approximately $60,000 to $394,000~~remained flat at $2.0 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017 from approximately $334,000 for~~2023 and 2022, respectively. For the ~~nine~~six months ended ~~September~~June 30, 2016. For the three months ended September 30, 2017, approximately $184,000 related to depreciation for the West Palm Beach, Florida property and approximately $210,000 related to the amortization of trademarks and lease commissions. For the nine months ended September 30, 2016, approximately $116,000 related to depreciation for the West Palm Beach, Florida property and approximately $218,000 related to the amortization of trademarks and lease commissions. The increase in2023, depreciation and amortization expense consisted of depreciation for the ~~nine month period~~Paramus, New Jersey property of approximately $564,000, depreciation for 237 11^th of approximately $826,000, the amortization of lease commissions and acquired in-place leases of approximately $385,000 for 237 11^th, and amortization of warrants for $228,000. For the six months ended ~~September~~June 30, ~~2017 was primarily attributable to West Palm Beach, Florida property.~~

~~Write-off~~2022, depreciation and amortization expense consisted of ~~costs~~depreciation for the ~~nine months ended September 30, 2017 relating to demolished asset was~~Paramus, New Jersey property of approximately ~~$3.4 million. This is related to~~$573,000, depreciation for 237 11^th of approximately $819,000, the ~~77 Greenwich property’s acceleration~~amortization of ~~depreciation~~lease commissions and acquired in-place leases of ~~the building~~approximately $387,000 for 237 11^th, and ~~building improvements and demolition costs at 77 Greenwich due to the completion~~amortization of ~~demolition~~warrants of ~~the 57,000 square foot six-story commercial building.~~

~~Operating loss increased by~~ approximately $2.6 million to $7.5 million for the nine months ended September 30, 2017 from $4.9 million for the nine months ended September 30, 2016 as a result of the changes in revenues and operating expenses as described above.

$228,000.

Equity in net loss from unconsolidated joint ~~venture~~ventures increased by approximately $820,000 to $4,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 from equity in net income of $816,000 for the six months ended June 30, 2022. Equity in net loss from unconsolidated joint ventures represented our 10% share in 250 North 10^th, which was ~~approximately $804,000. This amount represents~~sold in February 2023, and our 50% share in The Berkley, which was sold in April 2022. For the ~~joint venture~~six months ended June 30, 2023, our share of the ~~newly constructed 95-unit multi-family property in Brooklyn, New York purchased on December 5, 2016. Our share of the~~net loss is primarily comprised of operating income before depreciation of ~~$900,000~~$121,000 offset by depreciation and amortization of ~~$1.2 million,~~$77,000 and interest expense of ~~$538,000~~$48,000 for 250 North 10^th. For the six months ended June 30, 2022, our share of the net income is primarily comprised of operating income before depreciation of $606,000 offset by depreciation and ~~other expenses~~amortization of ~~$6,000.~~$544,000, interest expense of $287,000, gain from the change in the fair market value of the interest rate swap of $37,000 and a gain on the settlement of the interest rate swap of $1.0 million upon the sale of The Berkley in April 2022.

Equity in net gain on sale of unconsolidated joint venture property represents the February 2023 sale of our interest in the joint venture that owned 250 North 10^th to our joint venture partner resulting in net proceeds of approximately $1.2 million after repayment of our Partner Loan, where we recognized an approximate $3.1 million gain, and in April 2022 the sale of The Berkley property with our joint venture partner for a sale price of $70.8 million, where our share of the gain was approximately $4.5 million.

Unrealized gain on warrants decreased by approximately $875,000 to $56,000 for the six months ended June 30, 2023 from a gain of $931,000 for the six months ended June 30, 2022. This represents the change in the fair market valuation of the warrants due mainly to the change in our stock price on the measurement date.

Interest expense, net increased by approximately ~~$172,000~~$7.5 million to $13.5 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 from ~~interest income, net of approximately $83,000~~$6.1 million for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~2022. For the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2023, there was approximately ~~$1.8~~$14.2 million ~~related to~~of gross interest expense incurred, ~~offset by~~$689,000 of which was capitalized into residential condominium units for sale. For the six months ended June 30, 2022, there was approximately ~~$1.6~~$8.8 million of ~~capitalized interest and $141,000 of interest income. For the nine months ended September 30, 2016, approximately $1.5 million related to~~ gross interest expense incurred, ~~offset by approximately $1.4~~$2.8 million of which was capitalized ~~interest and $194,000 of interest income.~~into residential condominium units for sale. The increase in gross interest expense ~~net, for the nine months ended September 30, 2017 of approximately $172,000 is primarily attributable~~was mainly due to higher overall interest on the WPB Loan (see Note 5 – Loans Payable and Secured Line of Credit – to our condensed consolidated financial statements) and interest rate increases period over period partially offset by an overall increase in interest incomerates on our ~~average daily cash balance of approximately $34.9 million for the nine months ended September~~loans after June 30, ~~2017 as compared to approximately $31.3 million for the nine months ended September 30, 2016.~~2022.

~~Amortization~~Interest expense - amortization of deferred finance costs increased by approximately ~~$285,000~~$1.0 million to ~~$345,000~~$1.8 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 from ~~$60,000~~$814,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2016. For the nine months ended September 30, 2017, $523,000 related~~2022. The increase was principally due to less capitalized amortization of finance costs ~~related to obtaining the~~for our loans ~~encumbering 77 Greenwich, the West Palm Beach, Florida property and the lines~~as part of credit, partially offset by $178,000 of costs capitalized to real estate under development. For the nine months ended September 30, 2016, $318,000 related to amortization of costs related to obtaining the loan encumbering 77 Greenwich partially offset by $258,000 of costs capitalized to real estate under development.

residential condominium units for sale.

We recorded an adjustment to our claims liability for the nine months ended September 30, 2017 of $1.0 million due to the settlement with our insurance carrier. We recorded an adjustment to our claims liability for the nine months ended September 30, 2016 of $132,000 which was due mainly to the positive settlement of the former Majority Shareholder liability.

Gain on sale from real estate for the nine months ended September 30, 2017 was approximately $3.9 million due to the sale of the Westbury, New York property on August 4, 2017 which generated approximately $15.2 million in net proceeds. No properties were sold during the same period last year.

~~We recorded approximately $38,000 in~~a $175,000 tax expense for the ~~nine~~six months ended ~~September~~June 30, ~~2017. We recorded no tax expense~~2023 compared to $190,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~

2022.

Net loss ~~available~~attributable to common stockholders ~~decreased~~increased by ~~$844,000~~approximately $11.8 million to ~~$3.9~~$17.2 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 from ~~$4.8~~$5.4 million for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~2022. This is a result of the changes discussed above, principally due to the increased net interest expense, amortization of deferred finance costs and increased operating and interest expenses at 77 Greenwich, as well as a smaller gain on the sale of our joint venture property in 2023 compared to 2022.

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Liquidity and Capital Resources

The COVID-19 pandemic and related matters, including government actions, shifts in residential consumer sentiment and changes to the broader and local economies, had a significant adverse impact on our business. More recently, the economic downturn, increased interest rates, high inflation and current financial market challenges have also impacted our business. While we believe many of these trends will reverse or stabilize, and the New York City economy and residential real estate markets generally saw improvement in 2022 and continue to see improvement in 2023, given our focus on New York City residential real estate, our business has been particularly impacted, and may continue to be, as described elsewhere in this Quarterly Report on Form 10-Q.

We currently expect that our principal sources of funds to meet our short-term and long-term liquidity requirements for working capital and ~~funds for acquisition and development or redevelopment of properties, tenant improvements, leasing costs, and~~ repayments of outstanding indebtedness and other costs will ~~include:~~

include some or all of the following:

(1)

~~cash on hand;~~net proceeds from divestitures of properties or interest in properties;

(2)

proceeds from new debt financings, increases to existing debt financings and/or other forms of secured or unsecured debt financing;

(3)

proceeds from ~~common stock~~equity or ~~preferred equity~~equity-linked offerings, including rights ~~offerings;~~offerings or convertible debt or equity or equity-linked securities issued in connection with debt financings;

(4)

cash on hand; and

(5)	cash flow from ~~operations; and~~operations.

~~(5)~~

~~net proceeds from divestitures of properties.~~

Cash flow from operations is primarily dependent upon the occupancy level of our portfolio, the net effective rental rates achieved on our leases, the collectability of rent, operating escalations and recoveries from our tenants and the level of operating and other ~~costs.~~

costs which will be affected by inflation and rising interest rates, among other factors.

As of ~~September~~June 30, ~~2017,~~2023, we had total cash and restricted cash of ~~$47.4~~$15.4 million, of which approximately ~~$34.9~~$4.4 million was cash and cash equivalents and approximately ~~$12.5 million was restricted cash. As of December 31, 2016, we had total cash of $8.4 million, of which approximately $4.7 million was cash and cash equivalents and approximately $3.7~~$11.0 million was restricted cash. Restricted cash represents amounts required to be restricted under our loan agreements, letter of credit (see Note 56 – Loans Payable and Secured Line of Credit - to our ~~condensed~~ consolidated financial ~~statements)~~statements for further information), deposits on residential condominium sales at 77 Greenwich, condominium sales proceeds that have not yet been transferred to the lender, and tenant related security ~~deposits~~deposits.

Cash Position

The Company’s cash and ~~deposits~~cash equivalents will not be sufficient to fund the Company’s operations, debt service, amortization and maturities and corporate expenses over the next 12 months, unless we are able to extend or refinance our maturing debt and raise additional capital, creating substantial doubt about our ability to continue as a going concern. Management is exploring opportunities to secure additional funding through the sale of assets, refinancings of outstanding indebtedness, and equity or debt financings or other sources. The Company also continues to explore a range of strategic and financing alternatives to maximize stockholder value, and to engage with parties that have expressed interest in the Company’s attributes and assets and may see the Company as a potential vehicle for growth, with potential opportunities to recapitalize the Company at a lower cost of capital. The Company has engaged our Advisors in connection with our strategic review process and to assist us in identifying and evaluating potential alternatives. Potential strategic alternatives that are being evaluated include securing an equity and/or debt financing of the Company, refinancing of existing debt, and/or a sale or merger or reverse merger of the Company. The Company extended the maturity dates of each of the secured line of credit and 237 11^th Loans by 12 months to March 2024 and July 2024, respectively. In April 2023, the Company reached an agreement with its CCF lender regarding, among other things, the deferment of cash interest payments and a $7 million prepayment until August 31, 2023, subject to extension in certain circumstances, which also provided that the Company will enter into a strategic transaction that results in the repayment of the CCF or prepay the CCF by $5 million from equity proceeds by such date.

Given the current environment there can be no assurance that we will be able to enter into future extensions, amendments and/or waivers with these or other lenders, raise additional capital, refinance indebtedness or enter into other financing arrangements or engage in asset sales or strategic partnerships sufficient to fund our cash needs, on terms satisfactory to us, if at all. We are also evaluating additional alternatives in restructuring our business and our capital structure, including but not limited to filing for bankruptcy protection or seeking an out-of-court restructuring of our liabilities. SeePart I, Item 1A. Risk Factors to our 2022 Annual Report on Form 10-K for further information.

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Corporate Credit Facility

In December 2019, we entered into a credit agreement (the “Corporate Credit Facility” or “CCF”) with an affiliate of a global institutional investment management firm as initial lender (the “CCF Lender”) and Trimont Real Estate Advisors, LLC, as administrative agent (the “Corporate Facility Administrative Agent”), pursuant to which the CCF Lender agreed to extend us credit in multiple draws aggregating $70.0 million, subject to increase by $25.0 million upon satisfaction of certain conditions and the consent of the CCF Lender. The CCF matures on December 19, 2024, subject to extensions until December 19, 2025 and June 19, 2026, respectively, under certain circumstances. The CCF provided for the proceeds of the Corporate Credit Facility to be used for investments in certain multi-family apartment buildings in the greater New York City area and certain non-residential real estate investments approved by the CCF Lender in its reasonable discretion, as well as in connection with certain property ~~acquisitions.~~recapitalizations and in specified amounts for general corporate purposes and working capital. The ~~increase~~CCF bears interest at a rate per annum equal to the sum of (i) 5.25% and (ii) a scheduled interest rate (the “Cash Pay Interest Rate”) based on six-month periods from the initial closing date, which Cash Pay Interest Rate, from the Closing Date until the six-month anniversary of the initial closing date initially equaled 4.0% and increases by 125 basis points in ~~total cash~~each succeeding six-month period, subject to increase during the extension periods. A $2.45 million commitment fee was payable 50% on the initial draw and 50% as amounts under the CCF are drawn, with any remaining balance due on the last date of the draw period, and a 1.0% exit fee is payable in respect of CCF repayments. As of June 30, 2023, we had paid $1.85 million of the commitment fee. With the reduction of the committed amount under the CCF as described below, no further commitment fee is due. The CCF may be prepaid at any time subject to a prepayment premium on the portion of the CCF being repaid.

In connection with the December 2020 transaction described below, the Company entered into an amendment to the Corporate Credit Facility (the “Corporate Facility Amendment”) pursuant to which, among other things, (i) the CCF Lender and the Corporate Facility Administrative Agent permitted the Company to enter into the Mezzanine Loan Agreement (as defined below) and related documents, (ii) the commitment made by the CCF Lender under the Corporate Credit Facility was reduced by the amount of the Mezzanine Loan (as defined below) from ~~January 1, 2017~~$70.0 million to ~~September 30, 2017~~$62.5 million, subject to increase by $25.0 million upon satisfaction of certain conditions and the consent of the CCF Lender, and (iii) the multiple on invested capital, or MOIC, amount that would be due and payable by the Company upon the final repayment of the loan pursuant to the CCF if no event of default exists and is continuing under the CCF at any time prior to December 22, 2022, was ~~primarily~~amended to combine the ~~result~~CCF and the Mezzanine Loan for purposes of calculating the MOIC, to the extent not previously paid, if any. See Note 6 – Loans Payable and Secured Line of Credit to our consolidated financial statements for further discussion.

In connection with the closing of the 77 Mortgage Loan and amendment to the Mezzanine Loan described below, we entered into amendments to our CCF in October 2021 and November 2021, pursuant to which, among other things, the parties agreed that (a) no additional funds will be drawn under the CCF, (b) the minimum liquidity requirement was made consistent with the 77 Mortgage Loan Agreement until May 1, 2023, (c) the Company will prepay the outstanding principal balance of the CCF in an amount no less than $7.0 million on or prior to May 1, 2023 and (d) the MOIC provisions were revised to provide that (i) the MOIC amount due upon final repayment of the CCF was amended to be consistent with the Mezzanine Loan such that if no event of default exists and is continuing under the CCF at any time prior to June 22, 2023, the amount due will be combined with the Mezzanine Loan, to the extent not previously paid, if any, and (ii) the amount of the CCF used to calculate the MOIC was reduced to $35.75 million. We entered into an amendment in November 2022, which eliminated the minimum liquidity requirement.

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(iii) certain covenants and other terms of the CCF were revised, including that a refinancing of 237 11th (excluding the extension of the existing loans) and/or the property in Paramus, New Jersey requires the prior written consent of the CCF Lender; the Company was required to meet with the CCF Lender to review the results of the Company’s strategic process, endeavor in good faith to establish mutually acceptable next steps, and provide copies of written term sheets received from participants in the strategic process, including at least one that addresses repayment or purchase of the CCF; and the removal of the ability of the Company to incur certain types of previously permitted debt and make previously permitted investments and other restricted payments.

In connection with the CCF, we also entered into a warrant agreement with the CCF Lender pursuant to which we issued to the CCF Lender ten-year warrants (the “Warrants”) to purchase up to 7,179,000 shares of our common stock. In connection with the Corporate Facility Amendment, the exercise price of the Warrants was amended from $6.50 per share to $4.31 per share, payable in cash or pursuant to a cashless exercise. In connection with the June 2023 amendment to the CCF, the parties entered into an amendment to the Warrant Agreement, pursuant to which the number of shares of common stock purchasable under the Warrants was reduced by 750,000 shares, and the Company issued 750,000 shares of common stock to the CCF Lender. See Note 11 – Stockholders Equity – Warrants to our consolidated financial statements for further discussion regarding the warrants.

At June 30, 2023, the CCF had an outstanding balance of $38.75 million, excluding deferred finance fees of $828,000, and an effective interest rate of 10.325%. Accrued interest totaled approximately $7.8 million at June 30, 2023.

As of June 30, 2023, the CCF was fully drawn and we were in ~~February 2017~~compliance with the covenants of the CCF.

77 Mortgage Loan

In October 2021, a wholly-owned subsidiary of ours (the “Mortgage Borrower”) entered into a loan agreement with Macquarie PF Inc., a part of Macquarie Capital, the advisory, capital markets and principal investment arm of Macquarie Group, as lender and administrative agent (the “77 Mortgage Lender”), pursuant to which 77 Mortgage Lender agreed to extend credit to Mortgage Borrower in the amount of up to $166.7 million (the “77 Mortgage Loan”), subject to the satisfaction of certain conditions (the “77 Mortgage Loan Agreement”). We borrowed $133.1 million on the closing date of the 77 Mortgage Loan and a portion of the proceeds of the 77 Mortgage Loan, together with the proceeds of an increase in the Mezzanine Loan, the Berkley Partner Loan and funds raised through the Private Placement were used to repay the 77 Greenwich construction facility that the Company entered into in December 2017. At the time of the closing of the 77 Mortgage Loan in October 2021, $33.6 million was available to be used to, among other things, complete construction of 77 Greenwich and fund carry costs while the residential condominium units are being sold, $30.6 million of such amount had been drawn by June 30, 2023. The $3.0 million additional amount remained undrawn at June 30, 2023.

The 77 Mortgage Loan has a two-year term with an option to extend for an additional year, if, among other conditions, the loan balance is $70.0 million or less and we purchase a new interest rate cap. Based on the current sales pace and market conditions, the Company currently anticipates the loan balance will exceed $70.0 million. The 77 Mortgage Loan is secured by the Mortgage Borrower’s fee interest in 77 Greenwich. In May 2023, the loan benchmark was converted from LIBOR to SOFR. The all-in interest rate 12.05% at June 30, 2023. The 77 Mortgage Loan bears interest at a rate per annum equal to the greater of (i) 7.00% in excess of SOFR and (ii) 7.25%; provided that, if, on April 22, 2023, the outstanding principal balance of the 77 Mortgage Loan, together with any accrued and unpaid PIK Interest and unpaid Additional Unused Fee (as those terms are defined below) is equal to or greater than $91.0 million, the rate per annum will be equal to the greater of (i) 9.00% in excess of SOFR and (ii) 9.25%. If cash flow from 77 Greenwich (including proceeds from the sales of residential units) is insufficient to pay interest payments when due, any accrued but unpaid interest will remain unpaid and interest will continue to accrue on such unpaid amounts (“PIK Interest”) until the cumulative PIK Interest and Additional Unused Fee accrues to $4.5 million (the “Threshold Amount”), after which all such amounts in excess of the Threshold Amount shall be paid in cash on a monthly basis until such amounts are less than the Threshold Amount. As advances of the 77 Mortgage Loan are made to Mortgage Borrower and the outstanding principal balance of the 77 Mortgage Loan increases, net proceeds from the sales of condominium units will be paid to 77 Mortgage Lender to reduce the outstanding balance of the 77 Mortgage Loan. A 1% per annum fee (the “Additional Unused Fee”) on a $3.0 million portion (the “Additional Amount”) of the 77 Mortgage Loan, is payable on a monthly basis on the undrawn portion of such Additional Amount. To the extent the 77 Mortgage Loan was not fully funded by October 22, 2022 (April 22, 2023 in the case of amounts with respect to construction work related to the new handicapped accessible subway entrance on Trinity Place), 77 Mortgage Lender had the discretion to force fund the remaining balance other than the Additional

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Amount into a reserve account held by 77 Mortgage Lender and disbursed in accordance with the terms of the 77 Mortgage Loan Agreement. The 77 Mortgage Lender elected to force fund the 77 Mortgage Loan in October 2022. The 77 Mortgage Loan is prepayable without penalty, subject to 77 Mortgage Lender receiving a minimum total return of $15.26 million, or if an advance has been made of the Additional Amount, the sum of $15.26 million, plus 10% of the Additional Amount that has been disbursed, in each case, inclusive of interest and fees, and must be prepaid in part in certain circumstances such as in the event of the sale of residential and retail condominium units. Mortgage Borrower was required to achieve completion of the construction work and the improvements for the project on or before July 1, 2022, subject to certain exceptions. In November 2022, we amended the 77 Mortgage Loan to, amongst other things, extend the Final Completion date to September 29, 2023 and eliminate the liquidity requirement. At that time, we drew down $3.0 million under the letter of credit to fund an interest reserve and $1.0 million to pay down the PIK balance. The 77 Mortgage Loan Agreement also includes additional customary affirmative and negative covenants for loans of this type, with the first sales pace covenant in April 2023, which was met. We also met our sales pace test as of July 2023.

In connection with the 77 Mortgage Loan Agreement, we entered into guarantees with the 77 Mortgage Lender pursuant to which we ~~raised~~guaranteed the completion and payment of costs and expenses related to the construction; the payment of accrued and unpaid interest and other fees, costs, expenses and payments due and payable with respect to the 77 Mortgage Loan or 77 Greenwich; and the payment when due of all amounts due to 77 Mortgage Lender, as a result of “bad-boy” provisions. Mortgage Borrower and the Company also entered into an environmental compliance and indemnification undertaking for the benefit of 77 Mortgage Lender.

Through June 30, 2023, the 77 Mortgage Loan had been paid down by approximately $62.1 million of proceeds from closed sales of ~~approximately $26.6~~residential condominium units to a balance of $106.0 million, ~~(net of $0.3~~which includes $4.4 million in ~~costs)~~PIK interest.

As of June 30, 2023, we were in compliance with the covenants of the 77 Mortgage Loan.

Mezzanine Loan

In December 2020, we entered into a mezzanine loan agreement with an affiliate of the CCF Lender (the “Mezzanine Loan Agreement”, and the loan thereunder, the “Mezzanine Loan”). The Mezzanine Loan was originally in the amount of $7.5 million and has a term of three years with two one-year extension options, exercisable under certain circumstances. The collateral for the Mezzanine Loan was the borrower’s equity interest in its direct, wholly-owned subsidiary. As of June 30, 2023, the blended interest rate for the 77 Mortgage Loan and the Mezzanine Loan was 12.05% on an annual basis. Interest on the Mezzanine Loan is not payable on a monthly basis but instead is automatically added to the unpaid principal amount on a monthly basis (and therefore accrues interest) and is payable in full on the maturity date of the Mezzanine Loan. Upon final repayment of the Mezzanine Loan, a MOIC will be due on substantially the same terms as provided for in the CCF. Subject to the prior sentence the Mezzanine Loan may be prepaid in whole or in part, without penalty or premium (other than payment of the MOIC amount, if applicable, as provided above), upon prior written notice to the lender under the Mezzanine Loan. In connection with the Mezzanine Loan, the Company entered into a completion guaranty, carry guaranty, equity funding guaranty, recourse guaranty and environmental indemnification undertaking.

In October 2021, the Mezzanine Loan Agreement was amended and restated to, among other things, (i) increase the amount of the loan thereunder by approximately $22.77 million, of which $0.77 million reflected interest previously accrued under the original Mezzanine Loan, (ii) reflect the pledge of the equity interests in the Mortgage Borrower to the Mezzanine Lender as additional collateral for the Mezzanine Loan and (iii) conform certain of the covenants to those included in the 77 Mortgage Loan Agreement, as applicable. Additionally, the existing completion guaranty, carry guaranty, recourse guaranty and environmental indemnification executed in connection with the original Mezzanine Loan Agreement were amended to conform to the mortgage guarantees and mortgage environmental indemnity made in connection with the 77 Mortgage Loan (and the existing equity funding guaranty was terminated). In November 2022, the Mezzanine Loan was amended to, amongst other things, extend the Final Completion date to September 29, 2023 and eliminate the liquidity requirement.

As of June 30, 2023, the Mezzanine Loan had a balance of $30.3 million and accrued interest totaled approximately $8.4 million. See Note 6 – Loans Payable and Secured Line of Credit to our consolidated financial statements for further discussion.

As of June 30, 2023, we were in compliance with the covenants of the Mezzanine Loan.

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237 11^th Loans

In June 2021, we entered into a $50.0 million senior loan (the “237 11^th Senior Loan”) provided by Natixis, and a $10 million mezzanine loan (the “237 11^th Mezz Loan” and together with the 237 11^th Senior Loan, the “237 11^th Loans”), provided by an affiliate of LibreMax, bearing interest at a blended rate of 3.05% per annum at that time. The SOFR-based floating rate 237 11^th Loans have an initial term of two years and three one-year extension options. The first extension option, which was exercised in July 2023, was not subject to satisfaction of any financial tests, but required a new interest rate cap be purchased by the Company. New interest rate caps were purchased in July 2023.

From time to time, properties that we own, acquire or develop may experience defects, including concealed defects, or damage due to natural causes, defective workmanship or other reasons. In these situations, we pursue our rights and remedies as appropriate with insurers, contractors, sellers and others. Due to water damage in apartment units and other property at 237 11^th resulting from construction defects which we believe were concealed by the prior ownership team and its contractor, we submitted a notice of claim to our insurance carrier for property damage and business interruption (lost revenue) in September 2018. The insurance carrier subsequently disclaimed coverage for the losses and we filed a complaint against the carrier alleging that it breached the insurance policy by denying coverage. We also filed legal claims against the seller, its parent company, and the general contractor to recover damages arising from defective construction of the building, including defects that resulted in water damage as well as the consummation of our Rights Offering in April 2017 in which we raised proceeds of approximately $13.9 million (net of $0.2 million in costs), which was partially offset by payments for operating expenses and pre-development activities.other defects. In addition, ~~on August 4, 2017, we sold our property located in Westbury, New York which generated approximately $15.2 million in net proceeds.~~

~~On February 22, 2017, we entered~~the general contractor has impleaded into two secured lines of credit for an aggregate of $12.0 million, with Sterling National Bank as the lender, which were secured by our properties located in Paramus, New Jersey, and Westbury, New York, respectively, and had an original maturity date of February 22, 2018. On August 4, 2017, we closedthat litigation several subcontractors who performed work on the ~~sale~~property. Management expects to recover some portion of the ~~Westbury, New York~~cost incurred to repair the property through the litigations and/or settlement negotiations with the seller, its parent company, the general contractor, the subcontractors, and the ~~$2.9~~insurance carrier, although the amount of damages that may be recoverable in litigation and/or potential settlement negotiations are uncertain at this time, as is the timing of receipt of any such payments. We continue to pursue all legal remedies. We incurred significant cash outflows for costs associated with these repairs and remediation, which commenced in September 2019 and was completed by December 31, 2021.

There was an outstanding balance of $50.0 million on the 237 11^th Senior Loan and $10.0 million on the 237 11^th Mezz Loan at June 30, 2023. As of June 30, 2023, the blended interest rate was 5.35% per annum.

As of June 30, 2023, we were in compliance with the covenants of the 237 11^th Loans.

Secured Line of Credit

Our $11.75 million line of credit ~~that was secured by this property, which was undrawn, matured on that date. The $9.1 million line of credit, which~~with Webster Bank (formerly known as Sterling National Bank) is secured by the Paramus, New Jersey property, and guaranteed by Trinity Place Holdings Inc. The Paramus property had been under contract for sale pursuant to a purchase and sale agreement, which was ~~undrawn as of September 30, 2017 and November 9, 2017. This~~subject to site plan approval. The agreement was terminated by the buyer in January 2023. The secured line of credit was ~~increased~~scheduled to ~~$11.0 million in September 2017,~~mature on May 22, 2023 and ~~we extended~~bore interest at the prime rate. Effective with an April 2023 amendment, the maturity date was extended to ~~February~~March 22, ~~2019.~~2024 and the interest rate was reduced to 2.5% during the period from April 2023 to the new maturity date. The secured line of credit ~~bears interest, for drawn amounts only, at 100 basis points over Prime, as defined, with a floor of 3.75%, and~~ is pre-payable at any time without penalty.

~~Cash Flows~~ As of June 30, 2023, the secured line of credit had an outstanding balance of $11.75 million.

Note Payable (250 North 10^th Partner Loan)

~~Cash Flows~~We owned a 10% interest in a joint venture with TF Cornerstone (the “250 North 10^th JV”) formed to acquire and operate 250 North 10^th, a 234-unit apartment building in Williamsburg, Brooklyn, New York. In January 2020, the 250 North 10^th JV closed on the acquisition of the property for a purchase price of $137.75 million, of which $82.75 million was financed through a 15-year mortgage loan (the “250 North 10^thNote”) secured by 250 North 10^th and the ~~Nine months Ended September 30, 2017 Compared~~balance was paid in cash. Our share of the equity totaling approximately $5.9 million was funded through a loan (the “Partner Loan”) from our joint venture partner. The Partner Loan bore interest at 7.0% and was prepayable any time within its four year term. We sold our interest in 250 North 10^th to ~~the Nine months Ended September 30, 2016~~

~~Net cash used~~our joint venture partner in ~~operating activities was approximately $7.1 million for the nine months ended September 30, 2017 as compared to approximately $11.0 million for the nine months ended September 30, 2016. The decrease~~February 2023 resulting in net proceeds of approximately ~~$3.9~~$1.2 million after repayment of ~~net cash used was due to~~our Partner Loan and release from the ~~$1.6 million write-off of costs relating to the demolished asset at the 77 Greenwich property due to its completion of demolition~~mortgage guaranty, and we realized a ~~one-time $6.9 million payment to the former majority shareholder made during the nine months ended September 30, 2016, which was partially offset by the~~net gain on the sale of approximately $3.1 million.

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Cash Flows

Cash Flows for the ~~Westbury, New York property of approximately $3.9 million.~~

Six Months Ended June 30, 2023 Compared to the Six Months Ended June 30, 2022

Net cash ~~used in investing~~provided by operating activities increased by approximately $1.5 million to $1.8 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 from $370,000 for the six months ended June 30, 2022. This increase was ~~approximately $17,000~~mainly due to the sale of seven residential condominium units at 77 Greenwich for the six months ended June 30, 2023 as compared to ~~approximately $15.6 million for the nine months ended September 30, 2016. The decrease of approximately $15.6 million mainly pertained to the net proceeds from~~ the sale of five residential condominium units` for the ~~Westbury, New York property on August 4, 2017 of approximately $15.2 million as well as approximately $5.1 million less~~six months ended June 30, 2022, an increase in ~~development work being performed this~~accounts payable and accrued expenses over the same period last year, ~~at our properties~~and an increase in prepaid expenses and other assets, net and receivables compared to the same period last year, partially offset by approximately $4.7 million more in restricted cash which was used for an $8.1 million initial deposit for the option to purchase a property at 237 11th Street, Brooklyn, New York.

year.

Net cash provided by ~~financing~~investing activities decreased by approximately $10.2 million to $7.2 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 from $17.4 million for the six months ended June 30, 2022. The decrease in cash provided by investing activities was ~~approximately $37.3~~due to $17.4 million in sale proceeds from the sale of our 50% interest in The Berkley in April 2022 as compared to $7.2 million in sale proceeds from the sale of our 10% interest in the 250 North 10^th joint venture property in February 2023.

Net cash used in financing activities decreased by approximately ~~$6.7~~$10.5 million to $15.7 million for the ~~nine~~six months ended ~~September~~June 30, ~~2016. This increase mainly results~~2023 from ~~our private placement of common stock~~$26.2 million for the six months ended June 30, 2022. The decrease in February 2017 in which we raised net proceeds of approximately $26.6 million as well as our Rights Offering in April 2017 in which we raised net proceeds of approximately $13.9 million, partially offset by an increase of net cash used in financing activities ~~of $0.6 million from the prior year related~~primarily relates to the ~~repurchase~~approximate $20.5 million in repayments of ~~common stock from certain employees~~loans and notes payable and $5.0 million in ~~order~~borrowings for the six months ending June 30, 2023 as compared to ~~pay withholding taxes on~~$30.6 million in repayments of loans and the ~~common stock which vested during the period as well as $8.7~~secure line of credit and $4.7 million of ~~net proceeds last year from~~borrowings for the ~~Loan.~~six months ending June 30, 2022.

Net Operating Losses

We believe that our U.S. ~~Federal~~federal NOLs as of the emergence date of the Syms bankruptcy ~~Plan~~ were approximately $162.8 million and believe our U.S. ~~Federal~~federal NOLs ~~at September~~as of June 30, ~~2017~~2023 were approximately ~~$230.3~~$293.4 million. In connection with the conveyance of the school condominium to the SCA, we applied approximately $11.6 million of federal NOLs against taxable capital gains of approximately $18.5 million. Since 2009 through June 30, 2023, we have utilized approximately $20.1 million of the federal NOLs.

Based on management’s assessment, it is more likely than not that the entire deferred tax assets will not be realized by future taxable income or tax planning ~~strategy.~~strategies. Accordingly, a valuation allowance of ~~$96.8~~$83.9 million was recorded as of ~~September~~June 30, ~~2017.~~

2023.

We believe that certain of the transactions that occurred in connection with our emergence from bankruptcy in September 2012, including the rights offering and the redemption of the Syms shares owned by the former ~~Majority Shareholder that occurred~~majority shareholder of Syms in ~~connection~~accordance with ~~our emergence from bankruptcy on September 14, 2012~~the Plan, resulted in us undergoing an “ownership change,” as that term is used in Section 382 of the Code. However, while the analysis is complex and subject to subjective determinations and uncertainties, we believe that we should qualify for treatment under Section 382(l)(5) of the Code. As a result, we ~~currently~~ believe that our NOLs are not subject to an annual limitation under ~~Code~~ Section 382. However, if we were to undergo a subsequent ownership change in the future, our ability to utilize our NOLs could be subject to limitation under ~~Code~~ Section 382. In addition, the TCJA limited the deductibility of NOLs arising in tax years beginning after December 31, 2017 to 80 percent of taxable income (computed without regard to the net operating loss deduction) for the taxable year. However, the CARES Act suspended the 80% limitation on the use of NOLs for tax years beginning before January 1, 2021, and allowed losses arising in taxable years beginning after December 31, 2017 and before January 1, 2021 to be carried back up to five years.

~~Notwithstanding the above, even~~Even if all of our regular U.S. ~~Federal~~federal income tax liability for a given year is reduced to zero by virtue of utilizing our NOLs, we may still be subject to ~~the U.S. Federal alternative minimum tax and to~~ state, local or other non-federal income taxes.

Our certificate of incorporation includes a provision intended to help preserve certain tax benefits primarily associated with our ~~NOLs (the “Protective Amendment”). The Protective Amendment~~NOLs. This provision generally prohibits transfers of stock that would result in a person or group of persons becoming a 4.75% stockholder, or that would result in an increase or decrease in stock ownership by a person or group of persons that is an existing 4.75% stockholder.

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Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q, including information included or incorporated by reference in this Quarterly Report on or any supplement to this Quarterly Report, may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended ~~(the “Securities Act”),~~ and ~~Section 21E of~~ the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and information relating to us that are based on the beliefs of management as well as assumptions made by and information currently available to management. These forward-looking statements include, but are not limited to, statements about our plans, objectives, expectations and intentions that are not historical facts, and other statements identified by words such as “may,” “will,” “expects,” ~~believes,~~“believes,” “plans,” “estimates,” “potential,” or ~~“continue,~~“continues,” or the negative thereof or other and similar expressions. In addition, in some cases, you can identify forward-looking statements by words or phrases such as “trend,” “potential,” “opportunity,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar expressions. Such statements reflect our current views with respect to future events, the outcome of which is subject to certain risks, including among others:

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our expectation that our existing capital resources will not be sufficient to fund our operations for at least the next 12 months if we are not successful in consummating a strategic transaction and/or raising additional capital;

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risks and uncertainties as to the terms, timing, structure, benefits and costs of any capital raising or strategic transaction and whether one will be consummated on terms acceptable to us or at all;

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our limited cash resources, generation of minimal revenues from operations, and our reliance on external sources of financing to fund operations in the future;

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risks associated with our debt and upcoming debt maturities and other payment obligations and the risk of defaults on our obligations, debt service requirements and covenant compliance;

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our ability to obtain additional financing and refinance existing loans and on favorable terms;

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risks associated with covenant restrictions in our loan documents that could limit our flexibility to execute our business plan;

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our ability to execute our business plan, including as it relates to the development of and sale of residential condominium units at our largest asset, ~~a property located at~~ 77 ~~Greenwich Street in Lower Manhattan;~~Greenwich;

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risks associated with the Company evaluating and potentially consummating a strategic transaction, including the risk that the Company may fail to realize the anticipated benefits of any such transaction;

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our investment in property development may be more costly than anticipated and investment returns from our properties planned to be developed may be less than anticipated;

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adverse trends in the ~~Manhattan~~New York City residential condominium market;

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~~our ability to obtain additional financing and refinance existing loans and on favorable terms;~~

~~our limited operating history;~~

general economic and business conditions, including with respect to real estate, and their effect on the New York City residential real estate market in particular;

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our ability to enter into new leases and renew existing leases with tenants at our commercial and residential properties;

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we may acquire properties subject to unknown or known liabilities, with limited or no recourse to the seller;

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risks associated with the effect that rent stabilization regulations may have on our ability to raise and collect rents;

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competition for new acquisitions and investments;

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risks associated with acquisitions and investments in owned and leased real estate generally, including risks related to closing, obtaining suitable financing in connection with and achieving the intended benefits of the potential acquisition of the apartment building located at 237 11th Street, Brooklyn, New York;estate;

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risks associated with joint ventures;

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our ability to ~~enter into new leases and renew existing leases;~~maintain certain state tax benefits with respect to certain of our properties;

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our ability to obtain required permits, site plan approvals and/or other governmental approvals in connection with the development or redevelopment of our properties;

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costs associated with complying with environmental laws and environmental contamination, as well as the ~~influence of certain significant stockholders;~~Americans with Disabilities Act or other safety regulations and requirements;

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~~potential conflicts~~loss of ~~interest as a result of certain of our directors having affiliations with certain of our stockholders;~~key personnel;

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~~limitations in our certificate~~the effects of ~~incorporation on acquisitions and dispositions of our common stock designed to protect our ability to utilize our NOLs and certain other~~new tax ~~attributes, which may not succeed in protecting our ability to utilize such tax attributes, and/or may limit the liquidity of our common stock;~~laws;

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our ability to utilize our NOLs to offset future taxable income and capital gains for U.S. Federal, state and ~~state~~local income tax purposes;

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risks associated with current political and economic uncertainty, and developments related to the ~~failure~~outbreak of contagious diseases;

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risks associated with breaches of information technology systems;

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stock price volatility and other risks associated with a lightly traded stock;

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stockholders may be diluted by the issuance of additional shares of common stock or securities convertible into common stock in the future;

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a declining stock price may make it more difficult to raise capital in the future;

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the influence of certain significant stockholders;

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limitations in our charter on transactions in our common stock by substantial stockholders, designed to protect our ability to utilize our NOLs and certain other tax attributes, may not succeed and/or may limit the liquidity of our ~~wholly-owned subsidiaries to repay outstanding indebtedness;~~common stock;

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~~stock price volatility;~~

~~loss of key personnel;~~

certain provisions in our charter documents and Delaware law may have the effect of making more difficult or otherwise discouraging, delaying or deterring a takeover or other change of control of us;

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~~competition;~~certain provisions in our charter documents may have the effect of limiting our stockholders’ ability to obtain a favorable judicial forum for certain disputes; and

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~~risks associated with partnerships or joint ventures; and~~

unanticipated difficulties which may arise and other factors which may be outside our control or that are not currently known to us or which we believe are not material.

In evaluating such statements, you should specifically consider the risks identified under the section entitled “Risk Factors” in our ~~2016~~2022 Annual Report for the year ended December 31, ~~2016,~~2022, as filed with the Securities and Exchange Commission (the “SEC”) on March ~~15, 2017,~~31, 2023, and under the section entitled “Risk Factors” in this Quarterly Report on Form 10-Q, any of which could cause actual results to differ materially from the anticipated results. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results or outcomes may vary materially from those contemplated by any forward looking statements. Subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements in this paragraph and elsewhere described in ~~the aforementioned 2016~~our 2022 Annual Report, this Form 10-Q and other reports filed with the SEC. All forward-looking statements speak only as of the date of this Form 10-Q or, in the case of any documents incorporated by reference in this Form 10-Q, the date of such document, in each case based on information available to us as of such date, and we assume no obligation to update any forward-looking statements, except as required by law.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

Market risks that arise from changes in interest rates, foreign currency exchange rates and other market changes affect market sensitive instruments. In pursuing our business strategies, the primary market risk which we are exposed to is interest rate risk.

Low to moderate levels of inflation during the past several years have favorably impacted our operations by stabilizing operating expenses. At the same time, low inflation has had the indirect effect of reducing our ability to increase tenant rents. However, our tenant leases include expense reimbursements and other provisions to minimize the effect of inflation.

The market risk associated with financial instruments and derivative financial instruments is the risk of loss from adverse changes in market prices or interest rates. Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings and cash flows and to lower our overall borrowing costs. From time to time, we may enter into interest rate hedge contracts such as swaps, caps, collars, and treasury lock agreements in order to mitigate our interest rate risk with respect to various debt instruments. We would not hold or issue these derivative contracts for trading or speculative purposes. We do not have any foreign operations and thusAs a smaller reporting company, we are not ~~exposed~~required to ~~foreign currency fluctuations.~~

As of September 30, 2017, our debt consisted of two variable-rate secured mortgage loans payable, with carrying values of $40.0 million and $9.1 million, which approximated their fair values at September 30, 2017. We also have a secured line of credit of $11.0 million that was undrawn as of September 30, 2017. Changes in market interest rates on our variable-rate debt impactprovide the fair value of the loans and interest incurred or cash flow. For instance, if interest rates increase 100 basis points and our variable-rate debt balance remains constant, we expect the fair value of our obligation to decrease, the same way the price of a bond declines as interest rates rise. The sensitivity analysis related to our variable–rate debt assumes an immediate 100 basis point move in interest rates from their September 30, 2017 levels, with all other variables held constant. A 100 basis point increase in market interest rates would result in a decrease in the fair value of our variable-rate debtdisclosure required by $0.6 million. A 100 basis point decrease in market interest rates would result in an increase in the fair value of our variable-rate debt by $0.6 million. These amounts were determined by considering the impact of hypothetical interest rates changes on our borrowing costs, and assuming no other changes in our capital structure.this Item.

As of September 30, 2017, the debt on the unconsolidated joint venture, in which we hold a 50% interest, consisted of a variable-rate secured mortgage loan payable, with a carrying value of $42.5 million (see Note 12 – Investment in Our Unconsolidated Joint Venture – to our condensed consolidated financial statements), which approximated its fair value at September 30, 2017. A 100 basis point increase in market interest rates on the loan taken out by the unconsolidated joint venture would result in a decrease in the fair value of the joint ventures’ variable-rate debt by $0.5 million. A 100 basis point decrease in market interest rates would result in an increase in the fair value of the joint ventures’ variable-rate debt by $0.5 million. These amounts were determined by considering the impact of hypothetical interest rates changes on borrowing costs, and assuming no other changes in the capital structure of the joint venture.

As the information presented above includes only those exposures that existed as of September 30, 2017, it does not consider exposures or positions arising after that date. The information represented herein has limited predictive value. Future actual realized gains or losses with respect to interest rate fluctuations will depend on cumulative exposures, hedging strategies employed and the magnitude of the fluctuations.

Item 4. Controls and Procedures

~~Evaluation of Disclosure Controls and Procedures~~

a)Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer (the “CEO”) and Chief Financial Officer (the “CFO”), as appropriate, to allow timely decisions regarding required disclosure based closely on the definition of “disclosure controls and procedures” in Rule 13a-15(e) of the Exchange Act. Notwithstanding the foregoing, a control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that it will detect or uncover failures within ~~Trinity~~the Company to disclose material information otherwise required to be set forth in our periodic reports.

Our management, with the participation of our CEO and CFO, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Exchange Act as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on ~~this~~such evaluation, ~~the~~our CEO and CFO have concluded that as of June 30, 2023, our disclosure controls and procedures were not effective at the reasonable assurance level as a result of the ~~end of~~material weakness in our internal control over financial reporting discussed below.

b)Internal Control Over Financial Reporting

Other than in connection with the ~~period covered by this Quarterly Report on Form 10-Q.~~

~~Internal Control Over Financial Reporting~~

~~There~~material weakness described below, there were no changes in our internal control over financial reporting identified in management’s evaluation pursuant to Rules 13a-15(d) or 15d-15(d) of the Exchange Act during the ~~three months ended September 30, 2017,~~period covered by this Quarterly Report on Form 10-Q that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Previously Reported Material Weakness in Internal Control over Financial Reporting

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. In connection with the preparation of our consolidated financial statements as of and for the quarter ended June 30, 2022, our management identified two material weaknesses in our internal control over financial reporting related to errors identified in connection with the accounting treatment regarding the overcapitalization of internally allocated construction related costs related to the development project at 77 Greenwich and a disclosure error in the classification on the balance sheets of our 77 Greenwich property which was classified as real estate under development in real estate and is now classified as residential condominium units for sale. There was also a restatement on the statement of cash flows from investing activities to operating activities related to this error. Our management communicated the results of its assessment to the Audit Committee of the Board of Directors of the Company.

As disclosed in Item 4. “Controls and Procedures” of our Quarterly Report on Form 10-Q for the quarterly period ending March 31, 2022 and June 30, 2022, we previously identified a material weakness in our internal control over financial reporting related to an error identified in connection with the classification of a property as real estate under development which was not subsequently reported as an operating property when circumstances at the property changed, resulting in the incorrect capitalization of certain costs.

Remediation

We have commenced measures to remediate the identified material weaknesses. We performed additional procedures to ensure the properties we own are properly classified as either an operating property or property under development, and that we are capitalizing the appropriate amount of internally allocated construction related costs related to the development project at 77 Greenwich Street. The material weakness will not be considered remediated until management designs and implements effective controls that operate for a sufficient period of time and management has concluded, through testing, that these controls are effective. Until the material weakness is remediated, we will continue to perform additional analysis

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and other post-closing procedures to ensure that our consolidated financial statements are prepared in accordance with U.S. GAAP. Management believes that the consolidated financial statements, and related notes thereto included in this Quarterly Report on Form 10-Q fairly present, in all material aspects, the Company’s financial condition, results of operations and cash flows for the periods presented.

PART II. OTHER INFORMATION

~~PART II.~~

~~OTHER INFORMATION~~

~~Item 1.~~

~~Legal Proceedings~~

Item 1. Legal Proceedings

WeIn the normal course of business, we are a party to routine legal ~~proceedings, which are primarily incidental to our former business. Some of the actions to which we are a party are covered by insurance and are being defended or reimbursed by our insurance carriers.~~proceedings. Based on ~~an analysis performed by our actuary~~advice of counsel and available information, including current status or stage of proceedings, and taking into account accruals where they have been established, management currently believes that any liabilities ultimately resulting from ~~this routine~~ litigation we are currently involved in will not, individually or in the aggregate, have a material adverse effect on our consolidated financial ~~position. Additionally, as discussed in Note 1 to our condensed consolidated financial statements, we currently operate under the Plan that was approved in connection with the resolution~~position, results of ~~the Chapter 11 cases involving Syms and its subsidiaries.~~operations or liquidity.

~~Item 1A.~~

~~Risk Factors~~

~~There are no material changes to the~~Item 1A. Risk Factors ~~as disclosed~~

Numerous factors affect our business and results of operations, many of which are beyond our control. In addition to information set forth in this Quarterly Report, you should carefully read and consider "Item 1A. Risk Factors" in Part I and "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II of our ~~2016~~ Annual ~~Report.~~Report on Form 10-K for the year ended December 31, 2022, which describe significant risks that may cause our actual results of operations in future periods to differ materially from those currently anticipated or expected.

~~Item 2.~~

~~Unregistered Sales of Equity Securities and Use of Proceeds~~

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Recent Sales of Unregistered Securities

None.

Issuer Purchases of Equity Securities

None.

Item 3. Defaults Upon Senior Securities

None.

~~Item 3.~~

~~Defaults Upon Senior Securities~~

~~None.~~

~~Item 4.~~

~~Mine Safety Disclosures~~

Item 4. Mine Safety Disclosures

Not Applicable.

~~Item 5.~~

~~Other Information~~

Item 5. Other Information

None.

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~~Item 6.~~

~~Exhibits~~

Item 6. Exhibits

3.1	Amended and Restated Certificate of Incorporation of Trinity Place Holdings Inc. (incorporated by reference to Exhibit 3.1 of the Form 8-K filed by us on February 13, 2015).

3.2	Bylaws of Trinity Place Holdings Inc. (incorporated by reference to Exhibit 3.2 of the Form 8-K filed by us on September 19, 2012).
10.1*
10.1*	~~Option~~Amendment No. 7 to Credit Agreement, dated as of ~~September 8, 2017, by~~June 9, 2023, among Trinity Place Holdings Inc., as borrower, each subsidiary of the borrower listed on the signature pages thereto, as a guarantor, the lenders party thereto and ~~between 470 4~~^th ~~Avenue Investors~~TPHS Lender LLC, ~~and 470 4~~^th ~~Avenue Fee Owner, LLC.~~as administrative agent.
10.2*	Second Amendment to Warrant Agreement, dated as of June 15, 2023, between Trinity Place Holdings Inc. and TPHS Lender LLC.
31.1*	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*	Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**	Certification of Chief Executive Officer pursuant to Rule 13a-14(b) under the Securities and Exchange Act of 1934 and 18.U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2**	Certification of Chief Financial Officer pursuant to Rule 13a-14(b) under the Securities and Exchange Act of 1934 and 18.U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101*	The following materials from our Quarterly Report on Form 10-Q for the period ended ~~September~~June 30, ~~2017~~2023 formatted inas inline XBRL (eXtensible Business Reporting Language): (i) ~~Condensed~~ Consolidated Balance Sheets as of ~~September~~June 30, ~~2017 (unaudited)~~2023 and December 31, ~~2016 (audited),~~2022, (ii) ~~Condensed~~ Consolidated Statements of Operations and Comprehensive Loss for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017 (unaudited)~~2023 and ~~the three and nine months ended September~~June 30, ~~2016 (unaudited),~~2022, (iii) ~~Condensed~~ Consolidated ~~Statement~~Statements of Stockholders’ Equity for the ~~nine~~three and six months ended ~~September~~June 30, ~~2017 (unaudited),~~2023 and June 30, 2022, (iv) ~~Condensed~~ Consolidated Statements of Cash Flows for the ~~nine~~six months ended ~~September~~June 30, ~~2017 (unaudited)~~2023 and ~~nine months ended September~~June 30, ~~2016 (unaudited) and~~2022, (v) Notes to ~~Condensed~~ Consolidated Financial Statements ~~(unaudited).~~and (vi) Cover Page Interactive Data File.

104*	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

*Filed herewith

Filed herewith

**	Furnished herewith

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	TRINITY PLACE HOLDINGS INC.

Date: ~~November~~ ~~8, 2017~~August 14, 2023	By	/s/ Matthew Messinger
		MATTHEW MESSINGER
		PRESIDENT and CHIEF EXECUTIVE OFFICER
		(Principal Executive Officer)

Date: ~~November~~ ~~8, 2017~~August 14, 2023	By	/s/ Steven Kahn
		STEVEN KAHN
		CHIEF FINANCIAL OFFICER
		(Principal Financial Officer)

~~Delaware~~	~~22-2465228~~
Delaware	22-2465228
(State or Other Jurisdiction of	(I.R.S. Employer Identification No.)
Incorporation or Organization)

340 Madison Avenue, New York, New York	10173
(Address of Principal Executive Offices)	(Zip Code)


Title of Each Class	Trading Symbol	Name of each exchange on which registered
Common Stock $0.01 Par Value Per Share	TPHS	NYSE American


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		~~PAGE NO.~~
		PAGE NO.
PART I.	FINANCIAL INFORMATION	3

Item 1.	Condensed Consolidated Financial Statements (unaudited)	3

	~~Condensed~~ Consolidated Balance Sheets as of ~~September~~June 30, ~~2017 (unaudited)~~2023 and December 31, ~~2016 (audited)~~2022	3

	~~Condensed~~ Consolidated Statements of Operations and Comprehensive Loss for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017 (unaudited)~~2023 and ~~September~~the three and six months ended June 30, ~~2016 (unaudited)~~2022	4

	~~Condensed~~ Consolidated ~~Statement~~Statements of Stockholders' Equity for the ~~nine~~three and six months ended ~~September~~June 30, ~~2017 (unaudited)~~2023 and the three and six months ended June 30, 2022	5

	~~Condensed~~ Consolidated Statements of Cash Flows for the ~~nine~~six months ended ~~September~~June 30, ~~2017 (unaudited)~~2023 and ~~September~~the six months endedJune 30, ~~2016 (unaudited)~~2022	6 7

	Notes to Condensed Consolidated Financial Statements ~~(unaudited)~~	7 8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26 27

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	38 42

Item 4.4.	Controls and Procedures	40 42

PART II.	OTHER INFORMATION	40 43

Item 1.	Legal Proceedings	40 43

Item 1A.	Risk Factors	40 43

Item 2.2.	Unregistered Sales of Equity Securities and Use of Proceeds	40 43

Item 3.	Defaults Upon Senior Securities	40 43

Item 4.	Mine Safety Disclosures	40 43

Item 5.	Other Information	41 43

Item 6.	Exhibits	41 44

	Three Months Ended September 30, 2017			Three Months Ended September 30, 2016			Nine Months Ended September 30, 2017			Nine Months Ended September 30, 2016
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Revenues
Rental revenues	$	336		$	328		$	1,017		$	974
Tenant reimbursements		171			208			445			435

Total revenues		507			536			1,462			1,409

Operating Expenses
Property operating expenses		178			144			549			445
Real estate taxes		124			63			345			167
General and administrative		1,509			1,529			4,200			5,272
Transaction related costs		9			49			77			99
Depreciation and amortization		145			121			394			334
Write-off of costs relating to demolished asset		3,426			-			3,426			-

Total operating expenses		5,391			1,906			8,991			6,317

Operating loss		(4,884	)		(1,370	)		(7,529	)		(4,908	)

Equity in net loss from unconsolidated joint venture		(296	)		-			(804	)		-
Interest income (expense), net		20			(12	)		(89	)		83
Amortization of deferred finance costs		(145	)		(39	)		(345	)		(60	)
Reduction of claims liability		-			(2	)		1,043			132

Loss before gain on sale of real estate and taxes		(5,305	)		(1,423	)		(7,724	)		(4,753	)

Gain on sale of real estate		3,853			-			3,853			-

Tax expense		-			-			(38	)		-

Net loss available to common stockholders	$	(1,452	)	$	(1,423	)	$	(3,909	)	$	(4,753	)

Loss per share - basic and diluted	$	(0.05	)	$	(0.06	)	$	(0.13	)	$	(0.19	)

Weighted average number of common shares - basic and diluted		31,446			25,483			30,114			25,409

																Accumulated
					Additional											Other
	Common Stock				Paid-In		Treasury Stock						Accumulated			Comprehensive
	Shares		Amount		Capital		Shares			Amount			Deficit			Loss			Total

Balance as of December 31, 2016 (audited)		30,680	$	307	$	87,521		(5,016	)	$	(51,086	)	$	(5,556	)	$	(3,161	)	$	28,025

Net loss available to common stockholders		-		-		-		-			-			(3,909	)		-			(3,909	)
Sale of common stock, net		5,472		55		40,506		-			-			-			-			40,561
Settlement of stock awards		655		6		-		(339	)		(2,580	)		-			-			(2,574	)
Stock-based compensation expense		-		-		2,248		-			-			-			-			2,248

Balance as of September 30, 2017 (unaudited)		36,807	$	368	$	130,275		(5,355	)	$	(53,666	)	$	(9,465	)	$	(3,161	)	$	64,351

	Nine Months Ended September 30, 2017					Year Ended December 31, 2016
	Number of Shares			Weighted Average Fair Value at Grant Date		Number of Shares			Weighted Average Fair Value at Grant Date

Balance available, beginning of period		614,500					770,000
Granted to employees		(8,600	)	$	9.13		(105,500	)	$	5.29
Granted to non-employee directors		(18,938	)	$	6.88		(50,000	)	$	9.85
Deferred under non-employee director's deferral program		(5,643	)	$	6.88		-
Balance available, end of period		581,319					614,500

Property Location	Type of Property	Building Size (estimated rentable square feet)		Number of Units		Leased at September 30, 2017			Occupancy at September 30, 2017			Occupancy at September 30, 2016

Owned Locations

New York, New York (77 Greenwich) (1)	Property under development		57,000		-		N/A			N/A			N/A

Paramus, New Jersey (2)	Property under development		77,000		-		-			100.0	%		5.2	%

West Palm Beach, Florida (3)	Retail		112,000		-		68.9	%		68.9	%		67.8	%


Total Owned Square Feet			246,000

Joint Venture

223 North 8th Street, Brooklyn, New York - 50% (4)	Multi-family		65,000		95		94.7	%		94.7	%		-

Grand Total Square Feet			311,000

	Number of Tenants	Leased Square Feet by Year of Expiration		Annualized Rent in Year of Expiration (A)

2017 (B)	2		2,400	$	29
2018	1		4,000		140
2019	-		-		-
2020	8		12,488		245
2021	2		7,063		119
Thereafter	6		55,462		1,121
	19		81,413	$	1,654