BRT Apartments (BRT) risk factors, FY2024 10-K

Risks Related to Real Estate Investments and Our Operations

1. 01Unfavorable market and economic conditions could adversely affect rental revenues, occupancy levels and the value of our properties
2. 02We may be unable to compete to acquire, finance or dispose of our properties or to lease rental units
3. 03Increasing real estate taxes, utilities and insurance premiums may negatively impact operating results
4. 04Most of our multi-family properties are located in the Southeast and Texas which makes us susceptible to adverse developments in such markets
5. 05The failure of property management companies to properly manage our properties could adversely impact our results of operations
6. 06Our efforts to buy properties directly may involve greater risks than buying properties with joint venture partners
7. 07Risks involved in conducting real estate activity through joint ventures
8. 08Our operating results are significantly influenced by demand for multi-family properties generally, and a decrease in such demand will likely have a greater adverse effect on our revenues than if we owned a more diversified real estate portfolio
9. 09Our operating results and assets may be negatively affected if our insurance coverage is insufficient to compensate us for casualty events occurring at our properties
10. 10We may be adversely effected if we are unable to maintain a satisfactory working relationship with any one or more of our joint venture partners
11. 11Short-term leases expose us to the effects of declining market rents and we may be unable to renew leases or relet units as leases expire

Risks Related to Our Financing Activities, Indebtedness and Capital Resources

1. 12If we are unable to refinance our mortgage debt at maturity on acceptable terms, we may be forced to sell properties on disadvantageous terms
2. 13(1) Includes our joint venture partner's "share" of such debt
3. 14Our acquisition, development and value-add activities are limited by the funds available to us
4. 15Our failure to comply with our obligations under our debt instruments may reduce our stockholders’ equity, and adversely affect our net income and ability to pay dividends
5. 16We may not have sufficient funds to make required or desired capital improvements
6. 17If we are required to make payments under any “bad boy” carve out guarantees that we have provided in connection with certain mortgages and related loans, our business and financial results could be materially adversely affected
7. 18We could be negatively impacted by changes in our relationship with Fannie Mae or Freddie Mac, changes in the condition of Fannie Mae or Freddie Mac and by changes in government support for multi-family housing
8. 19We depend on our subsidiaries for cash flow and will be adversely impacted if these subsidiaries are prohibited from distributing cash to us

Regulatory and Tax Risks

1. 20Changes to the U.S. federal income tax laws could have an adverse impact on our business and financial results
2. 21Liabilities relating to environmental matters may impact the value of our properties
3. 22Compliance or failure to comply with the ADA or other safety regulations and requirements could result in substantial costs
4. 23Provisions for credit losses are difficult to estimate
5. 24We face numerous risks associated with the real estate industry that could adversely affect our results of operations through decreased revenues or increased costs
6. 25Compliance with REIT requirements may hinder our ability to maximize profits
7. 26Because real estate investments are illiquid, we may not be able to reconfigure our portfolio on a timely basis
8. 27We may incur impairment charges in 2025
9. 28If we do not continue to pay cash dividends, the price of our common stock may decline
10. 29Our business and operations are subject to physical and transition risks related to climate change

Risks Related to BRT's Organization, Structure and Ownership of its Stock

1. 30Our transactions with affiliated entities involve conflicts of interest
2. 31Senior management and other key personnel are critical to our business and our future success may depend on our ability to retain them
3. 32We do not carry key man life insurance on members of our senior management
4. 33The stock market is volatile, and fluctuations in our operating results, removal from various indices and other factors could cause our stock price to decline

General Business Risks

1. 34Breaches of information technology systems could materially harm our business and reputation