Belpointe PREP, LLC Debt Disclosure
Note 7 – Debt, Net
2025 Debt Transactions
On September 29, 2025, we, through our indirect majority-owned subsidiaries, entered into a variable-rate non-recourse mortgage loan providing for up to $163.3 million in principal amount (the “Aster & Links Mortgage Loan”), and a variable-rate non-recourse mezzanine loan providing for up to $40.8 million in principal amount (the “Aster & Links Mezzanine Loan”, and together with the Aster & Links Mortgage Loan, the “Aster & Links Loans”) with SM Finance III LLC, as lender (the “Aster & Links Refinance Transactions”). Proceeds from the Aster & Links Refinance Transactions were used to extinguish the existing Aster & Links construction loan (the “1991 Main Construction Loan”) and mezzanine loan (the “1991 Main Mezzanine Loan”), resulting in a loss on extinguishment of debt of $3.0 million, which includes a non-cash write off of unamortized deferred financing costs of $2.6 million. Additional details regarding the loans are described below.
2024 Debt Transactions
On June 28, 2024, we, through our indirect majority-owned subsidiary entered into a variable-rate construction loan agreement for up to $104.0 million in principal amount (the “1000 First Construction Loan”) with various lenders, which is secured by our investment in VIV.
On June 26, 2024, our indirect majority-owned subsidiary entered into a fixed-rate loan agreement for $10.0 million in principal amount (the “900 8th Land Loan”) with KHRE SMA Funding, LLC.
On January 31, 2024, our indirect majority-owned subsidiary entered into a fixed-rate mezzanine loan agreement for up to $56.4 million in principal amount (the “1991 Main Mezzanine Loan”) with Southern Realty Trust Holdings, LLC.
The following table details our Debt, net (dollars in thousands):
| December 31, 2025 | Carrying Value as of December 31, | |||||||||||||||||||
| Indebtedness | Weighted Average Interest Rate | Maturity Date | Maximum Facility | 2025 | 2024 | |||||||||||||||
| Fixed rate loans: | ||||||||||||||||||||
| 1991 Main Mezzanine Loan (1) | — | $ | $ | 46,243 | ||||||||||||||||
| 900 8th Land Loan (2) | 9.50 | % | July 2026 | N/A | 10,000 | 10,000 | ||||||||||||||
| Variable rate loans: | ||||||||||||||||||||
| 1991 Main Construction Loan (1) | — | 97,521 | ||||||||||||||||||
| 1000 First Construction Loan (3) | SOFR + 3.80% | June 2027 | $ | 104,000 | 81,300 | 29,468 | ||||||||||||||
| Aster & Links Loans (4) | SOFR + 2.55% | October 2027 | $ | 204,138 | 173,925 | |||||||||||||||
| Total debt | 265,225 | 183,232 | ||||||||||||||||||
| Unamortized debt issuance costs | (2,274 | ) | (3,931 | ) | ||||||||||||||||
| Unamortized debt discount | (2,313 | ) | (2,284 | ) | ||||||||||||||||
| Debt, net | $ | 260,638 | $ | 177,017 | ||||||||||||||||
| (1) | Both the 1991 Main Mezzanine Loan and the 1991 Main Construction Loan were repaid in full in connection with the Aster & Links Refinancing Transaction. |
| (2) | The 900 8th Land Loan is secured by our investment at 900 8th Avenue South, Nashville, Tennessee. The 900 8th Land Loan contained two six-month extension options, both of which have been exercised as of December 31, 2025. |
| (3) | The 1000 First Construction Loan contains two one-year extension options, exercisable at our election, subject to certain terms and conditions set forth in the loan agreement. Advances under the 1000 First Construction Loan bear interest at a per annum rate equal to the one-month term Secured Overnight Financing Rate (“SOFR”) plus 3.80%, subject to a minimum all-in per annum rate of 7.55%. To mitigate our exposure to increases to the one-month SOFR, we have obtained an interest rate cap (see “Note 9 – Derivative Instruments”). The 1000 First Construction Loan is prepayable in whole or in part at any time with not less than 45 days’ notice. Full prepayment is subject to an interest make-whole amount, if any, calculated as of the prepayment date. |
| (4) | The Aster & Links Loans bear interest at a fluctuating rate based on: (i) one-month term SOFR, subject to a 3.25% floor, plus (ii) a blended rate of 2.55%, and requires interest-only monthly payments during their term. The Aster & Links Loans each contain two one-year extensions exercisable at our election, subject to certain terms and conditions set forth in each of the loan agreements. The Aster & Links Loans are secured by a first-priority mortgage on Aster & Links and a pledge of the borrower’s equity interest in an indirect subsidiary of the Company. To mitigate our exposure to increases to the one-month term SOFR, we have obtained interest rate caps (see “Note 9 – Derivative Instruments”). The Aster & Links Loans are prepayable in whole or in part at any time with not less than 30 days’ notice, however, if prepaid in full prior to October 2026, such prepayment is subject to an interest make-whole amount, if any, calculated as of the prepayment date. |
The following table summarizes the scheduled future principal payments, exclusive of extension options, under our debt arrangements as of December 31, 2025 (amounts in thousands):
| Year ended December 31, | ||||
| 2026 | $ | 10,000 | ||
| 2027 | 255,225 | |||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Thereafter | ||||
| Total | $ | 265,225 | ||
Interest paid, net of capitalized interest for the years ended December 31, 2025 and 2024, was $17.1 million and $7.5 million, respectively. During the year ended December 31, 2024 we capitalized unpaid lender fees of less than $0.1 million, which is a non-cash financing activity.
Amortization of deferred financing costs for the years ended December 31, 2025 and 2024, was $2.8 million and $2.3 million, respectively, of which $0.7 million and $1.0 million was capitalized, respectively.
Guarantees and Covenants
Each of our indebtedness agreements are secured by either the individual underlying real estate investments or by a pledge of ownership interests in the entity that indirectly owns the real estate investment. In connection with certain agreements, we have provided guarantees of payment and performance, completion guarantees, which, among other things, guarantee completion of the work at each individual construction project, as well as carveout guarantees pursuant to which we guarantee the borrowers obligations with respect to certain non-recourse carveout events, such as “bad acts,” environmental conditions, and violations of certain provisions of the loan documents. We also provided a customary environmental indemnity agreement to the certain lenders pursuant to which we agreed to protect, defend, indemnify, release and hold harmless such lenders from and against certain environmental liabilities related to the real estate investments for which they apply.
We are subject to various financial and operational covenants in connection with the Aster & Links Loans and 1000 First Construction Loan which include, but are not limited to, maintaining liquid assets of no less than $10.0 million and a net worth of no less than $110.0 million. As of December 31, 2025 and 2024, we were in compliance with all of our loan covenants.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 20, 2026 | Showing above |
| 2024 | Mar 31, 2025 | |
| 2023 | Mar 29, 2024 | |
| 2022 | Mar 31, 2023 | |
| 2021 | Mar 11, 2022 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.