MacKenzie Realty Capital Reports $6.09 Million Net Loss and Revenue Growth in Q1 2025

MacKenzie Realty Capital, Inc. reported a net loss of $6.09 million for the three months ended March 31, 2025, compared to a net loss of $2.95 million for the same period in 2024. The company's revenue from rental, reimbursements, and other property income increased to $4.27 million, up from $4.08 million year-over-year. For the nine months ended March 31, 2025, total revenue reached $17.26 million, a significant increase from $11.22 million in the prior year, primarily driven by the acquisition of new properties and an early lease termination income of $3 million.

Total operating expenses for the three months ended March 31, 2025, were $10.10 million, compared to $6.76 million in the same period last year. The increase in expenses was attributed to higher depreciation and amortization costs, which rose to $2.63 million from $1.91 million, and increased interest expenses, which climbed to $2.66 million from $1.60 million. The company also recorded an impairment loss of $9.5 million related to the Main Street West Office Building due to an early lease termination and subsequent default on the debt secured by the property.

In terms of strategic developments, MacKenzie Realty Capital has expanded its portfolio through acquisitions, including the Green Valley Medical Center and One Harbor Center, which contributed to the increase in rental income. The company also formed new entities for ongoing projects, such as MRC Aurora, which is developing a multi-family residential community. As of March 31, 2025, the company had total assets of $237.14 million, up from $233.09 million at the end of the previous fiscal year, with real estate assets netting $224.65 million.

Operationally, the company reported a total of 15,738,525 shares of common stock outstanding as of March 31, 2025, an increase from 13,302,573 shares a year earlier. The company’s cash and cash equivalents decreased to $5.14 million from $11.85 million, reflecting cash outflows from operating and investing activities. The company also reported a significant increase in liabilities, with total liabilities rising to $139.22 million from $125.14 million, largely due to increased mortgage notes payable and borrowings under a line of credit.

Looking ahead, MacKenzie Realty Capital plans to continue its investment strategy focused on real estate assets while managing its cash flow and liquidity. The company has suspended its common stock dividend to preserve liquidity amid economic uncertainties, including rising interest rates and inflation. The management remains optimistic about future growth opportunities, particularly through the development of new properties and strategic acquisitions, while navigating the challenges posed by the current market conditions.