Aug 11, 2026, 7:02 AM ETReal Estate

Chicago Atlantic Real Estate Finance — Second Quarter 2026 Earnings Summary

REFICHICAGO ATLANTIC REAL ESTATE FINANCE INC

Financial Performance

Net interest income for the three months ended June 30, 2026, was $12.83 million, down from $14.42 million in the same period in 2025.
Net income for the quarter was $7.47 million ($0.34 per diluted share), compared to $8.88 million ($0.41 per diluted share) in Q2 2025.
Distributable earnings (basic) were $9.29 million ($0.44 per share) for the quarter, down from $10.85 million ($0.52 per share) in Q2 2025.
Total expenses before provision for expected credit losses were $4.59 million for the quarter, compared to $4.57 million in Q2 2025.
Provision for current expected credit losses was $551,294 for the quarter, compared to $1.15 million in Q2 2025.
Book value per share was $14.15 as of June 30, 2026, down from $14.71 in Q2 2025.
Debt/equity ratio was 46.6% as of June 30, 2026, up from 38.8% in Q2 2025.
Total loan principal outstanding was $453.13 million as of June 30, 2026, up from $421.92 million in Q2 2025.
Regular dividends declared were $10.02 million ($0.47 per share) for the quarter, consistent with the $0.47 per share declared in Q1 2026 and Q2 2025.

The Company expects to maintain a dividend payout ratio based on Distributable Earnings per weighted average diluted share of approximately 90% to 100% for the full year 2026.
If taxable income requires additional distribution beyond the regular quarterly dividend, the Company expects to meet this requirement with a special dividend in the fourth quarter of 2026.
The outlook assumes the Company continues to operate on a standalone basis and does not reflect the effects of the pending Merger.

The Company operates in a niche commercial mortgage market serving the cannabis ecosystem.
Gross originations for the quarter were $59.2 million.
The portfolio consists of 26 portfolio companies as of June 30, 2026, down from 30 in Q2 2025.
Aggregate loan portfolio bearing a variable interest rate was 62.5% as of June 30, 2026, compared to 59.3% in Q2 2025.
Gross unlevered weighted average yield to maturity was 15.8% as of June 30, 2026, down from 16.8% in Q2 2025.
Unfunded commitments were $2.36 million as of June 30, 2026, down from $16.60 million in Q2 2025.

The Company notes that its niche market position allows it to set its own terms, protect downside, and generate yields that are increasingly hard to find in the private credit sector.
The Company is making strategic moves as the cannabis ecosystem evolves.

Earnings were negatively impacted by the timing of deployment, as repayments occurred early in the period while deployments occurred later.
The Koach Notes are subordinate to senior first lien indebtedness of approximately $39 million as of the closing date.
Risks include the potential failure of the proposed Merger with Chicago Atlantic BDC, Inc. to close, failure to obtain stockholder or regulatory approvals, and risks related to the cannabis industry including federal, state, and local legal and regulatory changes.
Risks also include changes in interest rates, credit spreads, and macroeconomic conditions.

Peter Sack, Co-Chief Executive Officer, stated the Company is proud of the $59.2 million in gross originations and that the portfolio continues to perform.
Management expressed a positive outlook and confidence in strategic moves positioning the Company favorably.
Management highlighted the completion of the merger with Chicago Atlantic BDC, Inc. as a key strategic move.

On July 9, 2026, the Company entered into a Loan Agreement with Koach Capital Fund I LLC and affiliates, issuing 4,306,754 shares of Common Stock at $14.53 per share in exchange for second lien promissory notes totaling approximately $62.5 million.
The Koach Notes bear interest at an aggregate rate of 12.0% per annum (10.0% cash and 2.0% payable in kind) and have an aggregate weighted average time to maturity of approximately 12.0 years.
On June 17, 2026, the Company entered into an Agreement and Plan of Merger with Chicago Atlantic BDC, Inc. (NASDAQ: LIEN), with LIEN continuing as the surviving company.
Based on NAVs as of March 31, 2026, former REFI stockholders would be expected to own approximately 50.5% of LIEN following the Merger.
The Merger is expected to close in the fourth quarter of 2026, subject to stockholder and regulatory approvals.
As of June 30, 2026, the Company had approximately $141.1 million of total drawn leverage, comprised of $91.1 million on a secured revolving credit facility and $50.0 million of outstanding senior unsecured notes due 2028.
As of August 11, 2026, the Company had $15.7 million available on its secured revolving credit facility and total liquidity, net of estimated liabilities, of approximately $16.0 million.