As of September 30, 2024, Sunrise Realty Trust, Inc. (formerly CRE South LLC) reported significant financial growth following its formation on August 28, 2023, and subsequent spin-off from Advanced Flower Capital Inc. (AFC) on July 9, 2024. The company’s cash and cash equivalents surged to $70.2 million, up from $31.2 million at the end of 2023. Total assets also increased dramatically to $167.8 million from $31.2 million, reflecting the successful transfer of AFC’s commercial real estate portfolio.
The company’s net income for the three months ended September 30, 2024, was $1.7 million, a substantial rise from just $7,767 during the same period in the previous year. For the nine months ended September 30, 2024, net income reached $5.0 million, compared to $7,767 for the prior period. Basic earnings per share for the third quarter were reported at $0.26, with diluted earnings per share at $0.25. Distributable earnings for the same quarter were $1.9 million, translating to $0.27 per share.
Interest income for the three months ended September 30, 2024, was approximately $3.2 million, a significant increase from $7,767 in the prior year. The company funded approximately $122.5 million in new loans during the nine months, with an outstanding principal of $97.5 million as of September 30, 2024. The loan portfolio consisted of six loans, with 72% having floating interest rates.
Strategically, the company entered into a $50 million unsecured revolving credit agreement, fully drawn as of September 30, 2024, with an interest rate of 1-month SOFR plus a margin of 2.75%. This facility was terminated on November 6, 2024, after the borrowings were repaid. Additionally, the company has plans to elect to be taxed as a Real Estate Investment Trust (REIT) for the taxable year ending December 31, 2024, which will require it to distribute at least 90% of its taxable income to shareholders.
Operating expenses for the three months ended September 30, 2024, totaled approximately $1.5 million, with management fees accounting for $0.4 million. The company also established a 2024 Stock Incentive Plan, granting restricted stock to its CEO, Brian Sedrish.
Overall, Sunrise Realty Trust has demonstrated robust growth in its financial metrics and strategic positioning within the commercial real estate lending market, particularly in the Southern United States.
About Sunrise Realty Trust, Inc.
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