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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2026


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 000-56611

North Haven Net REIT

(Exact name of registrant as specified in its charter)


Maryland		92-2570735
(State or other jurisdiction of incorporation or registration)		(I.R.S. Employer Identification No.)
1585 Broadway, 33rd Floor
New York, NY	212-761-2340	10036
(Address of principal executive offices)	Registrant’s telephone number, including area code	(Zip Code)

Securities registered pursuant to Section 12(b) of the Act: None.


Title of each class		Trading Symbol(s)		Name of each exchange on which registered

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

Table of Contents

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As of May 11, 2026, the issuer had the following shares outstanding: 18,273,122 Class F-S shares, 11,675,121 Class F-I shares, 18,673,979 Class S shares, 10,482,663 Class I shares, and 8,250,666 Class E shares.

Table of Contents

TABLE OF CONTENTS


		Page
Part I	Financial Information	3
Item 1.	Condensed Consolidated Financial Statements (Unaudited):	3
	Condensed Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025	3
	Condensed Consolidated Statements of Operations for the three months ended March 31, 2026 and 2025	4
	Condensed Consolidated Statements of Changes in Equity for the three months ended March 31, 2026 and 2025	5
	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025	7
	Notes to the Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	36
Item 4.	Controls and Procedures	38
Part II	Other Information	38
Item 1.	Legal Proceedings	39
Item 1A.	Risk Factors	39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 3.	Defaults Upon Senior Securities	40
Item 4.	Mine Safety Disclosures	40
Item 5.	Other Information	40
Item 6.	Exhibits	40
	Signatures	41

Table of Contents

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

NORTH HAVEN NET REIT

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

($ in thousands, except for share and per share data)


	March 31, 2026			December 31, 2025
Assets
Investments in real estate, net	$	1,683,423		$	1,693,921
Investment in real estate debt, net(1)		75,018			74,921
Cash and cash equivalents		328,944			102,616
Restricted cash and restricted cash equivalents		68,370			32,229
Intangible assets, net		328,042			336,039
Real estate under development		124,442			100,991
Other assets		25,395			21,852
Total assets(2)	$	2,633,634		$	2,362,569
Liabilities
Secured debt, net	$	1,193,273		$	1,104,656
Tenant contributions related to real estate under development		81,584			71,434
Subscriptions received in advance		66,950			30,871
Intangible liabilities, net		65,899			67,359
Due to affiliates		58,805			49,455
Other liabilities		56,280			46,959
Total liabilities(2)		1,522,791			1,370,734
Commitments and contingencies (Note 16)		—			—
Redeemable common shares, par value Class E shares, $0.01 per share, 1,225,000 shares issued and outstanding as of March 31, 2026 and December 31, 2025 (Note 9)		25,420			25,167
Redeemable non-controlling interests (Note 9)		519			514
Equity
Common shares, par value $0.01 per share, 59,385,429 and 52,131,183 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively (Note 12)		594			521
Additional paid-in capital		1,139,688			997,431
Accumulated deficit and cumulative distributions		(67,514	)		(44,141	)
Equity		1,072,768			953,811
Non-controlling interests in third-party ventures		12,051			12,258
Non-controlling interest attributable to preferred shareholders		85			85
Total equity		1,084,904			966,154
Total liabilities and equity	$	2,633,634		$	2,362,569

(1)

Net of a current expected credit loss allowance of $549 as of March 31, 2026 and December 31, 2025.

(2)

The condensed consolidated balance sheets include assets of consolidated variable interest entities (“VIEs”), which can only be used to settle the obligations of the VIEs of $175,278 and $162,861 as of March 31, 2026 and December 31, 2025, respectively, and liabilities, which includes third-party liabilities, for which the creditors or beneficial interest holders do not have recourse against the Company of $129,322 and $118,654 as of March 31, 2026 and December 31, 2025, respectively.

The accompanying notes are an integral part of the condensed consolidated financial statements.

Table of Contents

NORTH HAVEN NET REIT

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

($ in thousands, except for share and per share data)


	For the Three Months Ended
	March 31, 2026			March 31, 2025
Revenues
Rental revenue	$	41,130		$	12,997
Total revenues	$	41,130		$	12,997
Expenses
Rental property operating	$	3,651		$	1,617
Depreciation and amortization		18,173			6,656
Management fees		2,173			—
Performance participation allocation		4,068			—
General and administrative		1,670			1,074
Total expenses	$	29,735		$	9,347
Other income (expenses)
Income from investment in real estate debt	$	1,554		$	1,671
Other income		2,061			3,817
Interest expense		(17,975	)		(3,511	)
Total other income (expenses)	$	(14,360	)	$	1,977
Net income (loss)	$	(2,965	)	$	5,627
Net income (loss) attributable to non-controlling interests in Operating Partnership unit holders	$	(1	)	$	4
Net income (loss) attributable to non-controlling interests in third-party ventures	$	(5	)	$	1
Net income (loss) attributable to common shareholders	$	(2,959	)	$	5,622
Net income (loss) per common share, basic and diluted (Note 14)	$	(0.05	)	$	0.15
Weighted-average common shares outstanding, basic and diluted (Note 14)		57,900,901			38,623,450

The accompanying notes are an integral part of the condensed consolidated financial statements.

Table of Contents

NORTH HAVEN NET REIT

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited)

($ in thousands, except for share and per share data)


	Common Shares (Par Value)
	Shares			Amount			Additional paid-in capital			Accumulated deficit and cumulative distributions			Total Shareholders' Equity			Non-controlling interests in third party ventures and attributable to preferred shareholders			Total Equity
December 31, 2025		52,131,183		$	521		$	997,431		$	(44,141	)	$	953,811		$	12,343		$	966,154
Common shares issued		7,204,774			73			148,354			-			148,427			-			148,427
Common shares repurchased (Refer to Note 12 - Equity for gross per share)		(495,195	)		(5	)		(10,189	)		-			(10,194	)		-			(10,194	)
Share class transfers		(11	)		-			-			-			-			-			-
Amortization of restricted share grants		-			-			20			-			20			-			20
Offering costs		-			-			(6,863	)		-			(6,863	)		-			(6,863	)
Distribution reinvestment		544,678			5			11,205			-			11,210			-			11,210
Distributions declared on common shares (Refer to Note 12 - Equity for gross per share)		-			-			-			(20,414	)		(20,414	)		-			(20,414	)
Net loss ($1 allocated to redeemable non-controlling interests)		-			-			-			(2,959	)		(2,959	)		(5	)		(2,964	)
Distributions to non-controlling interests		-			-			-			-			-			(202	)		(202	)
Allocation to redeemable common shares		-			-			(252	)		-			(252	)		-			(252	)
Allocation to redeemable non-controlling interests		-			-			(18	)		-			(18	)		-			(18	)
March 31, 2026		59,385,429		$	594		$	1,139,688		$	(67,514	)	$	1,072,768		$	12,136		$	1,084,904

The accompanying notes are an integral part of the condensed consolidated financial statements.

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NORTH HAVEN NET REIT

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited)

($ in thousands, except for share and per share data)


	Common Shares (Par Value)
	Shares			Amount			Additional paid-in capital			Accumulated deficit and cumulative distributions			Total Shareholders' Equity			Non-controlling interests in third party ventures			Total Equity
December 31, 2024		34,705,985		$	347		$	659,755		$	(9,305	)	$	650,797		$	2,380		$	653,177
Common shares issued		3,845,676			39			77,819			-			77,858			-			77,858
Common shares repurchased (Refer to Note 12 - Equity for gross per share)		(77,885	)		(1	)		(1,546	)		-			(1,547	)		-			(1,547	)
Amortization of restricted share grants		-			-			20			-			20			-			20
Offering costs		-			-			(3,738	)		-			(3,738	)		-			(3,738	)
Distribution reinvestment		281,795			3			5,696			-			5,699			-			5,699
Distributions declared on common shares (Refer to Note 12 - Equity for gross per share)		-			-			-			(10,763	)		(10,763	)		-			(10,763	)
Net income ($4 allocated to redeemable non-controlling interests)		-			-			-			5,622			5,622			1			5,623
Distributions to non-controlling interests		-			-			-			-			-			(41	)		(41	)
Allocation to redeemable common shares		-			-			(86	)		-			(86	)		-			(86	)
Allocation to redeemable non-controlling interests		-			-			(6	)		-			(6	)		-			(6	)
March 31, 2025		38,755,571		$	388		$	737,914		$	(14,446	)	$	723,856		$	2,340		$	726,196

The accompanying notes are an integral part of the condensed consolidated financial statements.

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NORTH HAVEN NET REIT

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

($ in thousands)


	For the Three Months Ended
	March 31, 2026			March 31, 2025
Cash flows from operating activities:
Net income (loss)	$	(2,965	)	$	5,627
Adjustments to reconcile net income (loss) to cash provided by operating activities:
Management fees		2,173			—
Performance participation allocation		4,068			—
Straight-line rent adjustment		(4,114	)		(921	)
Amortization of (above)- below-market lease, net		(378	)		(357	)
Depreciation and amortization		18,173			6,656
Amortization of discount on mortgage loans		126			196
Amortization of real estate debt origination fees		(62	)		(61	)
Amortization of deferred financing costs		670			88
Amortization of restricted share grants		20			20
Changes in assets and liabilities
Other assets		630			(1,515	)
Other liabilities		3,325			1,932
Due to affiliates		(375	)		1,045
Net cash provided by operating activities	$	21,291		$	12,710
Cash flows from investing activities:
Acquisition of real estate	$	—		$	(59,824	)
Funding of real estate debt		(35	)		(83	)
Investment in unconsolidated joint venture		—			(2,113	)
Capital improvements to real estate		(699	)		(868	)
Funding of deferred lease costs		(60	)		—
Funding of construction		(23,072	)		—
Change in earnest money and other deposits		—			250
Net cash used in investing activities	$	(23,866	)	$	(62,638	)
Cash flows from financing activities:
Proceeds from issuance of common shares	$	116,158		$	48,094
Subscriptions received in advance		66,950			28,601
Repurchase of common shares		(6,083	)		(245	)
Contributions from tenants		10,492			—
Payment of offering costs		(1,981	)		(1,223	)
Proceeds from mortgage loans		89,100			106,250
Payment of deferred financing costs		(643	)		(1,304	)
Change in earnest money deposit attributable to secured debt		70			(2,000	)
Repayment of mortgage loans		(472	)		(291	)
Payment of distributions to common shareholders		(8,333	)		(4,669	)
Payment of distributions to operating partnership units		(12	)		(8	)
Payment of distributions to non-controlling interests		(202	)		(41	)
Net cash provided by financing activities	$	265,044		$	173,164
Net change in cash, cash equivalents and restricted cash and cash equivalents	$	262,469		$	123,236
Cash, cash equivalents and restricted cash at the beginning of the period		134,845			291,338
Cash, cash equivalents and restricted cash and restricted cash equivalents at the end of the period	$	397,314		$	414,574
Reconciliation of cash, cash equivalents and restricted cash and restricted cash equivalents to the consolidated balance sheet:
Cash and cash equivalents	$	328,944		$	385,240
Restricted cash and restricted cash equivalents		68,370			29,334
Total cash, cash equivalents and restricted cash and restricted cash equivalents	$	397,314		$	414,574

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Supplemental disclosure:
Interest paid	$	15,467	$	2,528
Capital expenditures accrued, but not yet paid	$	1,015	$	—
Supplemental disclosure of non-cash financing activities:
Assumption of mortgage loans	$	—	$	51,000
Distribution reinvestment	$	11,210	$	5,696
Accrued distributions for common shareholders	$	7,159	$	3,720
Accrued distributions for redeemable non-controlling interests	$	4	$	3
Accrued shareholder servicing fees	$	5,314	$	3,444
Accrued offering costs	$	—	$	5
Issuance of redeemable Class E shares as payment for management fees	$	1,398	$	—
Accrued share repurchases	$	10,194	$	1,547
Allocation to redeemable common shares	$	252	$	86
Allocation to redeemable non-controlling interests	$	18	$	6

The accompanying notes are an integral part of the condensed consolidated financial statements.

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NORTH HAVEN NET REIT

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

($ in thousands, except for share and per share data)

1. Organization and Business Purpose

North Haven Net REIT (“we,” “us,” “our,” and the “Company”) was formed on February 6, 2023, as a Maryland statutory trust and has elected to be taxed as a real estate investment trust (“REIT”) under the U.S. Internal Revenue Code of 1986, as amended (the “Code”), for U.S. federal income tax purposes, commencing with its taxable year ended December 31, 2024, and intends to maintain such election. The Company invests in net lease investments comprised of high-quality commercial real estate assets that are primarily long-term leased under net lease structures to tenants for whom the properties are mission critical, meaning essential to the continuance of their business operations. The Company seeks to create a portfolio diversified across asset class, tenant industry, lease expiration and geography to attempt to mitigate credit risk concentration and volatility resulting from market conditions. In addition, to a lesser extent, the Company invests on a tactical basis in commercial real estate debt-related assets, which may include first mortgage loans, subordinated mortgage loans, mezzanine loans, preferred equity, real estate-related corporate credit, and commercial mortgage-backed securities, as well as other real estate-related securities (such as common and preferred stock of publicly traded REITs and other real estate companies) and loans (collectively referred to as, "CRE debt investments"). The Company is externally managed by MSREF Real Estate Advisor, Inc. (the “Adviser”), a Delaware corporation and wholly-owned subsidiary of Morgan Stanley (NYSE: MS) (“Morgan Stanley”).

The Company is the sole general partner of NH Net REIT Operating Partnership, LP, a Delaware limited partnership (the “Operating Partnership”). The Operating Partnership is consolidated by the Company and substantially all the Company's operations are conducted through the Operating Partnership. The Company owns 99.9% of the Operating Partnership and NH Net REIT Special Limited Partner LP, an affiliate of Morgan Stanley (the “Special Limited Partner”), owns a special limited partner interest in the Operating Partnership.

On January 11, 2024, the Company commenced a continuous, blind pool private offering (the “Offering”), pursuant to which it offers and sells to a limited number of investors an unlimited number of various classes of its common shares, including, but not limited to, common shares classified as Class S shares, Class I shares and Class E shares. The share classes have different upfront selling commissions, dealer manager fees, ongoing shareholder servicing fees and gross distributions, as well as different management fees and performance participation allocations.

The purchase price per share for each class of our common shares will vary and will generally equal the Company’s prior month’s net asset value (“NAV”) per share, as calculated monthly, plus applicable upfront selling commissions and dealer manager fees. The calculation of NAV may differ from a similar calculation under accounting principles generally accepted in the United States of America (“GAAP”).

As of March 31, 2026, the Company owned 33 net lease investments in the industrial sector, four net lease investments in the retail sector, one net lease investment in the healthcare sector, two parcels of land under development pursuant to build-to-suit arrangements and one investment in real estate debt.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The condensed consolidated financial statements, including the condensed notes thereto, are unaudited and exclude some of the disclosures required in audited financial statements. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the unaudited condensed consolidated balance sheet. Actual results could differ from those estimates.

All intercompany balances and transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission (“SEC”) on March 5, 2026.

Principles of Consolidation

The Company consolidates all entities in which it has a controlling financial interest through majority ownership or voting rights and variable interest entities whereby the Company is the primary beneficiary. In determining whether the Company has a controlling financial interest in a partially owned entity and the requirement to consolidate the accounts of that entity, the Company considers

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whether the entity is a variable interest entity (“VIE”) and whether it is the primary beneficiary. The Company is the primary beneficiary of a VIE when it has (i) the power to direct the most significant activities impacting the economic performance of the VIE and (ii) the obligation to absorb losses or receive benefits significant to the VIE.

The Operating Partnership is considered to be a VIE. Substantially all of the Company's operations are conducted through the Operating Partnership and the Company consolidates this entity as it has the ability to direct the most significant activities of the entity such as purchases, dispositions, financings, budgets, and overall operating plans. The Company meets the VIE disclosure exemption criteria.

As of March 31, 2026, the Company owned (i) a 95% interest in a joint venture, which is considered to be a VIE and (ii) a preferred equity interest in a joint venture, which is considered to be a VIE, both of which the Company consolidates because it is the primary beneficiary. Refer to “Note 6. Real Estate Under Development” for additional information.

Cash and Cash Equivalents

Cash and cash equivalents represent cash held in banks, cash on hand, and liquid investments with original maturities of three months or less. The Company may have bank balances in excess of federally insured amounts; however, the Company deposits its cash and cash equivalents with high credit-quality institutions to minimize credit risk exposure. As of March 31, 2026 and December 31, 2025, the Company held $288,240 and $60,333, respectively, in cash equivalents. Income generated on our cash and cash equivalents is recorded in the period in which it is earned under other income in the condensed consolidated statements of operations.

Restricted Cash and Restricted Cash Equivalents

Restricted cash and restricted cash equivalents primarily consist of cash received for subscriptions prior to the date in which shareholders are admitted into the Company and, to a lesser extent, cash held in escrow for property taxes and capital expenditures by a third-party loan servicer. The Company’s restricted cash was $1,420 and $32,229 as of March 31, 2026 and December 31, 2025, respectively, and is held in bank accounts controlled by the Company’s transfer agent and loan servicer but in the name of the Company. The Company's restricted cash equivalents were $66,950 and $0 as of March 31, 2026 and December 31, 2025, respectively.

Investments in Real Estate

When acquiring a property, the Company determines whether the acquisition should be accounted for as a business combination or an asset acquisition in accordance with Accounting Standards Codification (“ASC”) Topic 805, “Business Combinations.” For both a business combination and an asset acquisition, the Company records the identifiable assets acquired and liabilities assumed in the acquisition. For transactions that are business combinations, the Company evaluates the existence of goodwill or a gain from a bargain purchase and expenses acquisition-related costs as incurred. The Company capitalizes acquisition-related costs associated with asset acquisitions. As of March 31, 2026, the Company owned 38 properties and each acquisition was accounted for as an asset acquisition.

Upon acquisition of a property, the Company assesses the fair value of acquired tangible and intangible assets and assumed liabilities (including land, buildings, above- and below-market leases, in-place leases, and other identified intangible assets and liabilities) and then allocates the purchase price to these acquired assets and assumed liabilities based on respective fair values. The Company bases its fair value assessments on cash flow projections that utilize discount and/or capitalization rates that it deems appropriate, as well as other available market information. Estimates of future cash flows are based on several factors including the historical operating results, known and anticipated trends, and market and economic conditions. Assumed debt, if any, is recorded at fair value based on the present value of expected future payments and any assumed discount or premium to principal value is recorded as an adjustment to interest expense, using the effective yield method, in the condensed consolidated statements of operations.

The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant. Tangible assets include land and improvements, buildings, and site improvements. The Company records acquired above- and below-market leases at their fair values (using a discount rate which reflects the risks associated with the leases acquired) equal to the difference between (1) the contractual amounts to be paid pursuant to each in-place lease and (2) the Company’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed rate renewal options for below-market leases. The Company records acquired in-place lease values based on the Company’s evaluation of the specific characteristics of each tenant’s lease. Factors to be considered include estimates of carrying costs during hypothetical expected lease-up periods considering current market conditions, and costs to execute similar leases. In estimating carrying costs, the Company includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions. In estimating costs to execute similar leases, the Company considers leasing commissions, legal and other related expenses.

Intangible lease assets and liabilities are recorded net of amortization on the Company’s condensed consolidated balance sheets. The amortization of acquired above- and below-market leases is recorded to rental revenue in the Company’s condensed consolidated statements of operations. The amortization of leasing commissions and leases in-place are recorded in depreciation and amortization in the Company’s condensed consolidated statements of operations.

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The cost of buildings and improvements includes the purchase price of the Company’s properties and any acquisition-related costs, along with any subsequent improvements to such properties. The Company’s investments in real estate are recorded at cost and are generally depreciated on a straight-line basis over the estimated remaining useful lives of the assets as follows:


Description		Depreciable Life
Buildings		30 - 40 years
Building and site improvements		7 - 15 years
Lease intangibles and leasehold improvements		Over lease term

For the three months ended March 31, 2026 and 2025, the Company recognized depreciation expense of $11,197 and $4,286, respectively, which was recorded as depreciation and amortization in the condensed consolidated statements of operations.

Significant improvements to properties are capitalized within investments in real estate on the Company's condensed consolidated balance sheets whereas repairs and maintenance are expensed as incurred and recorded in rental property operating expense in the Company’s condensed consolidated statements of operations.

Real estate investments are evaluated for impairment on a quarterly basis. The Company considers the following factors when performing its impairment analysis: (1) management, having the authority to approve the action, commits to a plan to sell the asset; (2) significant negative industry and economic outlook or trends; (3) expected material costs necessary to extend the life or operate the real estate asset; and (4) its ability to hold and dispose of the real estate asset in the ordinary course of business. A real estate investment is considered impaired when the sum of estimated future undiscounted cash flows to be generated by the real estate investment over the estimated remaining holding period is less than the carrying value of such investment. An impairment charge is recorded equal to the excess of the carrying value of the real estate investment over the fair value. When determining the fair value of a real estate investment, the Company makes certain assumptions including, but not limited to, consideration of projected operating cash flows, comparable selling prices and projected cash flows from the eventual disposition of the real estate asset based upon its estimate of a capitalization rate and discount rate. As of March 31, 2026 and December 31, 2025, the Company has not recorded any impairments on its investments in real estate.

Investments in Unconsolidated Joint Ventures

The Company accounts for joint venture investments using the equity method of accounting when its interest represents a general partnership interest but substantive participating rights or substantive kick out rights have been granted to the limited partners or when its interest does not represent a general partnership interest and it does not control the major operating and financial policies these investments. These investments are initially recorded at cost as investments in unconsolidated joint ventures and are subsequently adjusted for their share of earnings and cash contributions and distributions. To the extent the Company's cost basis at formation of the joint ventures are different than the basis reflected at the joint venture level, the basis difference is amortized over the life of the related assets and included in the Company's share of equity in earnings of unconsolidated joint ventures.

The Company analyzes its investments in unconsolidated joint ventures for impairment. This analysis consists of determining whether an expected loss in market value of an investment is other than temporary by evaluating the length of time and the extent to which the market value has been less than cost, the financial condition and near-term prospects of the investment, and the Company's intent and ability to retain its investment for a period of time sufficient to allow for any anticipated recovery in market value. As the factors used in this analysis are difficult to predict and subject to future events that may alter its assumptions, the Company may be required to recognize future impairment losses on its investments in unconsolidated affiliates. As of March 31, 2026 and December 31, 2025 the Company did not have any investments in unconsolidated joint ventures.

Redeemable Common Shares

The Company classifies common shares held by its affiliate as redeemable common shares on its condensed consolidated balance sheets at redemption value. Redemption value is determined based on the Company's NAV per share of the applicable share class as of the reporting date. Changes in the value of redeemable common shares are recorded within additional paid-in capital.

Revenue Recognition

The Company’s primary source of revenues is rental revenue, which is accounted for under ASC Topic 842, “Leases.” Rental revenue primarily consists of fixed contractual base rent, and, to a lesser extent, tenant reimbursements, arising from tenant operating leases at the Company's properties. Rent under leases where collection is deemed probable is recognized as revenue on a straight-line basis, including any determinable rent step-up or abatement provisions, over the non-cancelable term of the related leases. The Company begins to recognize revenue upon the acquisition of the related property or when a tenant takes possession of the leased space. Leases that are that are deemed uncollectible are recognized as a reduction to rental revenue through a reversal of deferred rent. Any future cash receipts on leases that are deemed uncollectible will be recorded as income on a cash basis. The Company evaluates the collectability of receivables related to rental revenue on an individual lease basis. The Company exercises judgment in assessing collectability and

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considers the length of time a receivable has been outstanding, tenant creditworthiness, payment history, available information about the financial condition of the tenant, and current economic trends, among other factors. As of March 31, 2026 and December 31, 2025, all rent collection was deemed probable.

The Company's investment in real estate debt consists of one commercial mortgage loan secured by real estate and is classified as held-to-maturity. The Company recognizes interest income on this loan using the effective interest method. Upfront origination fees are deferred and recognized over the life of the loan as an adjustment to yield under the effective interest method. Interest income and amortization of upfront origination fees are recorded under income from our investment in real estate debt in the condensed consolidated statements of operations.

Loans that are significantly past due may be placed on non-accrual status if the Company determines it is probable that it will not collect all payments that are contractually due. When a loan is placed on non-accrual status, interest is only recognized when it is received. A loan may be placed back on accrual status if the Company determines it is probable that it will collect all payments that are contractually due. As of March 31, 2026 and December 31, 2025, there were no loans on non-accrual status.

Current Expected Credit Losses

The current expected credit loss allowance (“CECL Allowance”) is an allowance for losses required under the ASC Topic 326, “Financial Instruments—Credit Losses” (“ASC 326”), which reflects the Company's current estimate of potential credit losses related to its investment in real estate debt included in its condensed consolidated balance sheets as a reduction of the carrying value of the investment. Changes to the CECL Allowance is recognized through net income on the Company's condensed consolidated statements of operations. While ASC 326 does not require any particular method for determining the CECL Allowance, it does specify the allowance should be based on relevant information about past events, including historical loss experience, current portfolio, market conditions and reasonable and supportable forecasts for the duration of each respective loan. ASC 326 requires that all financial instruments within its scope have some amount of loss allowance regardless of credit quality, subordinate capital or other mitigating factors.

As of March 31, 2026 and December 31, 2025, the Company had one investment in real estate debt and the CECL Allowance was estimated using the Weighted-Average Remaining Maturity (“WARM Method”). Under the WARM Method, the Company determines an annual average charge-off rate through referencing historic loan loss data across a comparable data set and apply such charge-off rate, with consideration of forecasted economic conditions, to its investment in real estate debt over its expected remaining term.

Application of the WARM Method to estimate the CECL Allowance requires judgment, including (i) relevant historical loan loss reference data, (ii) the expected timing and amount of future loan fundings and repayments, (iii) the current and expected economic conditions over the relevant time period and (iv) economic trends that may have isolated impact on a specific geographic location or property type. The Company compiled relevant historical loan loss reference data from an affiliate of the Adviser and third-party sources. Within this data, the Company focused our historical loss reference calculations on the subset of data most relevant to its one investment in real estate debt as of March 31, 2026 and December 31, 2025. The metrics considered by the Company include asset type, geography and origination loan-to-value. The Company believes this historical loan loss reference data is the most relevant, available and comparable dataset to its portfolio. In the future, the Company may use other acceptable methods, such as a probability-of-default/loss-given-default method.

Accrued interest related to the Company's investment in real estate debt is excluded from the carrying value when determining the CECL Allowance as any accrued interest deemed to be uncollectible is written off in a timely manner.

Estimation of Economic Conditions

In accordance with ASC 326, the CECL Allowance is adjusted to reflect the Company's estimation of the current and future economic conditions that impact the performance of the real estate securing its loans. These estimations include unemployment rates, interest rates, expectations of inflation and/or recession and other macroeconomic factors impacting the likelihood and magnitude of potential credit losses for the Company's loans during their anticipated term. This forecasted information is compiled from various sources, including information and opinions available to the Adviser, to further inform these estimations. This process requires significant judgments about future events that, while based on the information available to the Company as of the balance sheet date, are ultimately indeterminate and the actual economic condition impacting the Company's portfolio could vary significantly from the estimates it made as of March 31, 2026 and December 31, 2025.

Deferred Financing Costs

Costs incurred in connection with financings are capitalized and amortized over the non-cancelable financing term and are recorded as a component of interest expense within the condensed consolidated statements of operations. The deferred unamortized financing costs are recorded as a reduction to the carrying amount of the respective secured debt on the condensed consolidated balance sheets.

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Income Taxes

The Company has elected to be taxed as a REIT under the Code for U.S. federal income tax purposes, commencing with its taxable year ended December 31, 2024, and intends to maintain such election. As long as the Company qualifies for taxation as a REIT under the Code, the Company generally will not be subject to U.S. federal corporate income tax to the extent it annually distributes all of its taxable income to its shareholders. Although the Company is only required to distribute 90% of its taxable income, U.S. federal income and excise taxes may apply to any undistributed income. REITs are subject to a number of other organization and operational requirements. The Company believes that it is organized in conformity with the requirements for qualification and taxation as a REIT under the Code and that its intended manner of operation will enable the Company to continue to meet the requirements for qualification and taxation as a REIT for U.S. federal income tax purposes. Even while the Company qualifies for taxation as a REIT, it may be subject to certain U.S., state and local taxes on its income and property, and, as noted, U.S. federal income and excise taxes on its undistributed income.

The Company had no deferred tax asset or liability as of March 31, 2026 or December 31, 2025. For the three months ended March 31, 2026 and 2025, there were no unrecognized tax benefits. The Company is subject to U.S. federal, state and local income tax examinations by taxing authorities for the calendar years 2023 through 2025.

Earnings per Share

The Company calculates earnings per share using the two-class method, under which net income (loss) attributable to common shareholders is allocated among each class of common shares based on distributions declared and each class’s participation rights in earnings (losses). The Company tests for the dilutive effect of its third-party Operating Partnership units using the if-converted method. Refer to “Note 14. Earnings (Loss) per Share” for more information.

Organization and Offering Expenses

The Adviser advanced certain organization and offering expenses on behalf of the Company through April 1, 2025, which was 12 months following the initial closing of the Offering. The Company began reimbursing the Adviser for all such advanced expenses ratably over a 60-month period following April 1, 2025. Organization expenses are expensed as incurred, and offering expenses are charged to equity.

Share-Based Compensation

The Company compensates each non-employee member of its board of trustees who are not affiliated with Morgan Stanley with an annual retainer of restricted Class E shares as part of their compensation for services on its board of trustees. See “Note 12. Equity” for additional information regarding share-based compensation. Compensation cost related to restricted common shares issued is measured at its fair value on the grant date and amortized into expense over the vesting period on a straight-line basis.

Recent Accounting Pronouncements

The Company considers the applicability and impact of all accounting standards and pronouncements issued by the Financial Accounting Standards Board (“FASB”).

In November 2024, the FASB issued ASU 2024-03, “Income Statement (Topic 220-40): Reporting Comprehensive Income—Expense Disaggregation Disclosures” (“Topic 220-40”). Topic 220-40 requires the disaggregation of expenses into required categories in disclosures within the footnotes of the financial statements. The FASB identified the required expense categories as: (1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5) depreciation, depletion and amortization recognized as part of oil- and gas-producing activities or other depletion expenses. The guidance is effective for annual periods beginning after December 15, 2026. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. This guidance should be applied on a prospective basis, but retrospective application is permitted. The Company is currently evaluating the impact of adopting this new guidance on its financial statement disclosures.

3. Investments in Real Estate, net

Investments in real estate, net consisted of the following:

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	March 31, 2026			December 31, 2025
Building and building improvements	$	1,124,964		$	1,124,964
Land and land improvements		467,149			467,149
Site improvements		134,298			133,599
Total		1,726,411			1,725,712
Accumulated depreciation		(42,988	)		(31,791	)
Investments in real estate, net	$	1,683,423		$	1,693,921

Acquisitions

The Company did not have any acquisitions during the three months ended March 31, 2026.

The following table details the acquisition values, including capitalized costs, property types and total rentable square feet for acquisitions made by the Company during the three months ended March 31, 2025:


Property Type	Acquisition value		Number of properties		Square feet (in thousands)
Industrial	$	110,825		3		803

The following table summarizes the purchase price allocation for the properties acquired during the three months ended March 31, 2025:



	For the Three Months Ended March 31, 2025
Building and building improvements	$	72,064
Land and land improvements		15,710
Site improvements		14,477
In-place leases		10,480
Leasing commissions		3,000
Above-market lease		344
Below-market lease		(5,250	)
Total purchase price	$	110,825
Assumed borrowings(1)		(51,000	)
Net purchase price	$	59,825

(1)

Refer to “Note 7. Secured Debt, net” for more information on mortgage loans assumed.

Acquisition-related intangible assets and liabilities are recorded in intangible assets, net and intangible liabilities, net, respectively, on the condensed consolidated balance sheets.

4. Investment in Real Estate Debt, Net

The following table details the Company's investment in real estate debt:

          
         March 31, 2026

         Loan Type

         Principal Balance

         Deferred Fees

         Carrying Value(1)

         Coupon(2)

         Maturity Date

         Property Type

         Location

First mortgage

76,004

437

75,018

S + 4.15%

1/1/2028

Healthcare

Naples, FL

(1)

Net of a $549 CECL Allowance.

(2)

Represents the one-month SOFR, which was 3.65% as of March 31, 2026.

          
         December 31, 2025

         Loan Type

         Principal Balance

         Deferred Fees

         Carrying Value(1)

         Coupon(2)

         Maturity Date

         Property Type

         Location

First mortgage

75,969

499

74,921

S + 4.15%

1/1/2028

Healthcare

Naples, FL

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(1)

Net of a $549 CECL Allowance.

(2)

Represents the one-month SOFR, which was 3.88% as of December 31, 2025.

CECL Allowance

During the three months ended March 31, 2026 and 2025, the Company did not record any charge-offs or recoveries related to its investment in real estate debt. As of March 31, 2026, the Company's investment in real estate debt was not delinquent.

5. Intangibles

The following table summarizes the identified intangible assets:


	March 31, 2026									December 31, 2025
Intangible assets:	Intangible lease assets, gross		Accumulated amortization			Intangible lease assets, net		Weighted-average life (Years)		Intangible lease assets, gross		Accumulated amortization			Intangible lease assets, net		Weighted-average life (Years)
In-place leases	$	230,575	$	(18,794	)	$	211,781		11.7	$	230,514	$	(13,420	)	$	217,094		11.9
Leasing commissions		72,141		(5,584	)		66,557		12.0		72,141		(3,982	)		68,159		12.1
Above-market lease		53,525		(3,821	)		49,704		11.9		53,525		(2,739	)		50,786		12.1
Total intangible assets:	$	356,241	$	(28,199	)	$	328,042		11.8	$	356,180	$	(20,141	)	$	336,039		12.0

During the three months ended March 31, 2026 and 2025, the Company recognized $6,976 and $2,370, respectively, of amortization related to its in-place lease intangible assets and leasing commissions, which is recorded as a component of depreciation and amortization in the condensed consolidated statements of operations.

During the three months ended March 31, 2026 and 2025, the Company recognized $1,082 and $122, respectively, of amortization related to above-market lease intangible assets, which is recorded as a decrease to rental revenue in the condensed consolidated statements of operations.

The following table summarizes the identified intangible liabilities:


	March 31, 2026									December 31, 2025
Intangible liabilities:	Intangible lease liabilities, gross		Accumulated amortization			Intangible lease liabilities, net		Weighted-average life (Years)		Intangible lease liabilities, gross		Accumulated amortization			Intangible lease liabilities, net		Weighted-average life (Years)
Below-market lease	$	71,203	$	(5,304	)	$	65,899		12.9	$	71,203	$	(3,844	)	$	67,359		13.1
Total intangible liabilities:	$	71,203	$	(5,304	)	$	65,899		12.9	$	71,203	$	(3,844	)	$	67,359		13.1

During the three months ended March 31, 2026 and 2025, the Company recognized $1,460 and $479, respectively, of amortization related to below-market lease intangible liabilities, which is recorded as an increase to rental revenue in the condensed consolidated statements of operations.

The estimated future amortization of the Company’s intangible assets and liabilities for each of the next five years and thereafter as of March 31, 2026, is as follows:


Year	In-place leases		Leasing commissions		Above-market lease		Below-market lease
2026 (Remaining)	$	16,114	$	5,278	$	3,240	$	4,381
2027		21,478		7,037		4,321		5,842
2028		21,401		7,029		4,321		5,842
2029		21,401		7,029		4,321		5,842
2030		20,594		6,125		4,321		5,833
Thereafter		110,793		34,059		29,180		38,159
Total	$	211,781	$	66,557	$	49,704	$	65,899

6. Real Estate Under Development

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Nokia Bell Labs

In June 2025, the Company acquired a preferred equity interest in a joint venture, which is considered to be a VIE of which the Company is the primary beneficiary and as such is consolidated within the Company's condensed consolidated financial statements. The purpose of the joint venture is to construct a build-to-suit research and development facility subject to a net lease for a single tenant. The Company accounted for this transaction as an asset acquisition under ASC 805 and a summary of the purchase price allocation, inclusive of capitalized costs, as of the acquisition date is below:


	Amounts
Cash	$	13,602
Land		20,113
Construction in progress		14,903
Tenant improvements		4,679
Prepaid expenses		2,255
Accounts payable		(3,731	)
Tenant contributions related to real estate under development		(35,730	)
Total purchase price	$	16,091
Non-controlling interest		(10,346	)
Net purchase price	$	5,745

The land is 130,547 square feet and located in New Brunswick, New Jersey. The land, construction in progress and tenant improvements are recorded as real estate under development on the condensed consolidated balance sheets. As of March 31, 2026, the Company funded $65,843 in costs related to the development, which are recorded as real estate under development on the condensed consolidated balance sheets.

As of March 31, 2026, the tenant contributed an aggregate $81,584 used to fund costs related to the development, which are recorded as tenant contributions related to real estate under development on the condensed consolidated balance sheets.

The interest held by the Company's joint venture partner is $9,861 and recorded as non-controlling interests on the condensed consolidated balance sheets.

Jewel Osco

In August 2025, the Company purchased a 242,355 square foot parcel of land in St. John, Indiana for $5,144, inclusive of closing costs in connection with a built-to-suit arrangement for a single tenant. As of March 31, 2026, the Company funded $6,322 in costs related to the development, which, along with the land, is recorded as real estate under development on the condensed consolidated balance sheets.

7. Secured Debt, net

The following table details the Company's debt as of March 31, 2026 and December 31, 2025:


	March 31, 2026							December 31, 2025
Indebtedness	Weighted-Average Interest Rate(1)	Weighted-Average Maturity Date	Principal Balance		Amortized Cost			Weighted-Average Interest Rate(1)	Weighted-Average Maturity Date	Principal Balance		Amortized Cost
Mortgage loans(2)	5.74%	3/2/2031	$	1,153,521	$	1,151,955		5.72%	3/5/2031	$	1,064,893	$	1,063,201
Secured note(3)	S + 2.00%	1/1/2028		50,300		50,300		S + 2.00%	1/1/2028		50,300		50,300
Deferred financing costs, net						(8,982	)						(8,845	)
Total secured debt, net:			$	1,203,821	$	1,193,273				$	1,115,193	$	1,104,656

(1)

The term "S" represents one-month SOFR, which was 3.65% and 3.88% as of March 31, 2026 and December 31, 2025, respectively.

(2)

Amortized cost is net of unamortized mortgage discount of $1,566 and $1,762 and premium of $0 and $70 as of March 31, 2026 and December 31, 2025, respectively.

(3)

Secured by an investment in real estate debt with the same benchmark rate and maturity date including two one-year extension options.

As of March 31, 2026 and December 31, 2025, the Company was in compliance with all of its covenants related to its mortgage loans and secured note.

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The following table summarizes the future principal payments due under our secured debt, based on their maturities assuming all extension options have been exercised, as of March 31, 2026:


Year	Amount
2026 (Remaining)	$	1,889
2027		2,069
2028		58,443
2029		974
2030		744,231
Thereafter		396,215
Total:	$	1,203,821

8. Other Assets and Other Liabilities

The following table details the components of the Company's other assets at the dates indicated:


	March 31, 2026		December 31, 2025
Straight-line rent receivables	$	12,380	$	8,266
Tenant receivables		6,233		6,258
Prepaid expenses		5,179		5,594
Earnest money deposit		1,132		1,202
Interest receivable		471		532
Total other assets:	$	25,395	$	21,852

The following table details the components of the Company's other liabilities at the dates indicated:


	March 31, 2026		December 31, 2025
Construction payable	$	12,120	$	11,738
Redemptions payable		10,194		6,083
Distribution payable		7,163		6,292
Unearned rental income		6,610		6,391
Accrued property expenses		6,364		4,958
Accrued deferred lease costs		5,918		5,918
Interest payable		5,209		4,018
Other		2,702		1,561
Total other liabilities:	$	56,280	$	46,959

Unsecured Line of Credit

On October 1, 2025, the Company entered into a Credit Agreement (the “Credit Agreement”) with Bank of America, N.A (“BofA”). The Credit Agreement provides for a credit facility initially comprised of (i) a $150,000 revolving credit facility (the “Revolving Credit Facility”) and (ii) $10,000 of standby letters of credit with a maturity of October 1, 2027. The Credit Agreement also provides for a feature that allows the Company, under certain circumstances, to increase the overall size of the Revolving Credit Facility to a maximum of $500,000.

The obligations of the Company under the Credit Agreement are secured by (i) a pledge of the equity interests of certain of the Company’s subsidiaries, (ii) a pledge of certain intercompany promissory notes issued to one or more of the Loan Parties that is a pledgor and (iii) all proceeds of the foregoing, in each case subject to certain exclusions set forth in the Credit Agreement and related loan documents. At the option of the Company, the amounts outstanding under the Credit Agreement will bear interest at either (i) a rate equal to term SOFR or daily simple SOFR plus a margin rate ranging from 1.40% to 2.25% or (ii) a base rate based on the highest of (A) Federal Funds Rate plus half of 1%, (B) BofA’s prime rate, (C) Term SOFR plus 1.00% and (D) 1.00%. The Revolving Credit Facility is subject to a per annum fee based on the daily unused portion of the facility ranging from 0.15% to 0.25% and is payable quarterly in arrears. The Revolving Credit Facility is prepayable, in whole or in part, at any time without premium or penalty. As of March 31, 2026 and December 31, 2025, the Company had no outstanding balance on the Revolving Credit Facility.

As of March 31, 2026 and December 31, 2025, the Company was in compliance with all covenants related to the Revolving Credit Facility.

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9. Redeemable Common Shares and Non-Controlling Interests

On April 1, 2024, MSREI Holding, Inc., an affiliate of the Adviser purchased 1,225,000 Class E shares of the Company and the Special Limited Partner purchased 25,000 Class E Operating Partnership units, in each case, at a price per share/unit equal to $20.00 (the “Morgan Stanley Equity Investment”). Each of the offers and sales of the shares/units described above was exempt from the registration provisions of the Securities Act of 1933, as amended, by virtue of Section 4(a)(2) and/or Rule 506 of Regulation D thereunder.

MSREI Holding and the Special Limited Partner have agreed to hold the Class E shares/Operating Partnership units issued in respect of the Morgan Stanley Equity Investment until the earlier of (i) the first date that the Company's NAV reaches $1.5 billion and (ii) April 1, 2027, which is three years after the initial closing of the Offering. Following such date, each quarter MSREI Holding and the Special Limited Partner may request, with respect to the Morgan Stanley Equity Investment, that the Company repurchase (each, a “MS Repurchase”), a number of Class E shares/ Operating Partnership units in an amount equal to the amount available under the 5% quarterly cap set forth in the Company's share repurchase plan (as amended, the "Share Repurchase Plan"), but only after the Company first satisfy repurchase requests from all other common shareholders who have properly submitted a repurchase request for such quarter in accordance with the Share Repurchase Plan. Notwithstanding the foregoing, for so long as Morgan Stanley or its affiliate acts as investment adviser to the Company, the Company will not affect any MS Repurchase during any quarter in which the full amount of all common shares requested to be repurchased by shareholders other than Morgan Stanley and its affiliates under the Share Repurchase Plan is not repurchased or when the Share Repurchase Plan has been suspended.

As of March 31, 2026, Class E shares held by MSREI Holding and Class E units held by the Special Limited Partner pursuant to the Morgan Stanley Equity Investment are classified in mezzanine equity because the Company is required to repurchase or redeem, as applicable, these Class E shares / units upon request by the holders, subject to certain limitations and terms set forth in the applicable subscription agreement if certain conditions outside of the control of the Company are met (as discussed above).

The Class E shares held by MSREI Holding are classified as redeemable common shares on the Company's condensed consolidated balance sheets. The following table summarizes the changes in the Company's outstanding redeemable common shares for the three months ended March 31, 2026 and 2025:


	For the Three Months Ended March 31,
	2026			2025
Balance at the beginning of the year		1,225,000			1,225,000
Issuance of common shares		67,859			—
Repurchase of common shares		(67,859	)		—
Ending Balance		1,225,000			1,225,000

Redeemable common shares are recorded at their redemption value, which is equivalent to fair value, of such Class E common shares at the end of each measurement period. During the three months ended March 31, 2026 and 2025, there was an allocation of $252 and $86, respectively, to the redeemable common shares in connection with this fair value measurement.

The Class E Operating Partnership units held by the Special Limited Partner are classified as redeemable non-controlling interests on the Company's condensed consolidated balance sheets. Redeemable non-controlling interests are recorded at the greater of their carrying amount, adjusted for their share of the allocation of income or loss and dividends, or their redemption value, which is equivalent to fair value, of such Operating Partnership units at the end of each measurement period.

The following table details the activity of redeemable non-controlling interests related to the Special Limited Partner for the three months ended March 31, 2026 and 2025:


	For the Three Months Ended March 31,
	2026			2025
Balance at the beginning of the year	$	514		$	505
Issuance		-			-
GAAP income allocation		(1	)		4
Distributions		(12	)		(8	)
Fair value allocation		18			6
Ending Balance	$	519		$	507

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10. Related Party Transactions

The following table details the components of due to affiliates:


	March 31, 2026		December 31, 2025
Accrued shareholder servicing fees	$	48,000	$	43,118
Performance participation allocation payable		4,068		—
Advanced operating expenses		4,112		4,371
Advanced organization and offering expenses		1,850		1,966
Management fee payable		775		—
Due to affiliates	$	58,805	$	49,455

Organization and Offering Expenses and Operating Expenses

The Adviser advanced organization and offering expenses (including legal, accounting, printing, mailing, subscription processing and filing fees and expenses, reasonable bona fide due diligence expenses of participating broker-dealers supported by detailed and itemized invoices, costs in connection with preparing sales materials, design and website expenses, fees and expenses of the Company’s escrow agent and transfer agent, fees to attend retail seminars sponsored by participating broker-dealers and reimbursement for customary travel, lodging and meals, but excluding upfront selling commissions, dealer manager fees and the shareholder servicing fee) and certain operating expenses on the behalf of the Company through April 1, 2025, which was 12 months following the initial closing of the Offering. The Company began to reimburse the Adviser for all such advanced expenses ratably over a 60-month period following April 1, 2025. Such reimbursement may be paid, at the Adviser’s election, in cash, Class E shares or Class E Operating Partnership units, or any combination thereof. If the Adviser elects to receive any portion of such reimbursement in the Company’s common shares or Operating Partnership units, the Company may repurchase such common shares or units from the Adviser at a later date.

The table below summarizes expenses advanced by the Adviser and reimbursements made by the Company as of March 31, 2026 and December 31, 2025:


	March 31, 2026						December 31, 2025
Expense Type	Amount Advanced		Amount Reimbursed		Remaining Balance		Amount Advanced		Amount Reimbursed		Remaining Balance
Operating	$	5,147	$	1,035	$	4,112	$	5,147	$	776	$	4,371
Organization and offering		2,315		465		1,850		2,315		349		1,966
Total:	$	7,462	$	1,500	$	5,962	$	7,462	$	1,125	$	6,337

During the three months ended March 31, 2026, the Company reimbursed the Adviser $375 for advanced organization, offering and operating expenses. No reimbursements were made by the Company during the three months ended March 31, 2025.

Dealer Manager

On April 1, 2024, the Company entered into a dealer manager agreement (the “Dealer Manager Agreement”) with the Dealer Manager such that it will serve as the dealer manager for the Offering.

On April 28, 2025, the Company and the Dealer Manager entered into the Amended and Restated Dealer Manager Agreement, including a revised form of Participating Broker-Dealer Agreement to be entered into with certain broker-dealers, to make certain updates to reflect the designation of the new Class F-IO shares and Class IO shares.

The Dealer Manager is entitled to receive upfront selling commissions of up to 3.5% of the transaction price of each Class F-S share and Class S share sold in the Offering. For the three months ended March 31, 2026 and 2025, the Company incurred $639 and $289, respectively, in upfront selling commissions, which are charged against additional paid-in-capital as offering costs.

The Company pays the Dealer Manager selling commissions equal to 0.85% per annum of the aggregate NAV of our outstanding Class F-S shares and Class S shares over time as shareholder servicing fees for ongoing services rendered to shareholders. Shareholder servicing fees are accrued upon the sale of Class F-S shares and Class S shares and are based upon our best estimate of aggregate fees payable. For the three months ended March 31, 2026 and 2025, the Company incurred $6,224 and $3,444, respectively, in shareholder servicing fees, which are charged against additional paid-in-capital as offering costs.

There are no upfront selling commissions or shareholder servicing fees for Class I shares, Class F-I shares or Class E shares.

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Operating Partnership Agreement

On April 1, 2024, the Operating Partnership entered into the Amended and Restated Limited Partnership Agreement, by and among the Company, as the general partner, the Special Limited Partner, and the other limited partners party thereto from time to time.

On April 28, 2025, the Company, on behalf of itself as the general partner and on behalf of the limited partners thereto, entered into the Second Amended and Restated Limited Partnership Agreement of the Operating Partnership. The Second Amended and Restated Limited Partnership Agreement of the Operating Partnership amends the prior version of the agreement to make certain updates to reflect the new Class F-IO shares and Class IO shares and to establish two new corresponding classes of units of the Operating Partnership, designated as Class F-IO units and Class IO units.

On March 5, 2026, the Company, on behalf of itself as the general partner and on behalf of the limited partnership thereto, entered into the Third Amended and Restated Limited Partnership Agreement of the Operating Partnership. The Third Amended and Restated Limited Partnership Agreement of the Operating Partnership amends the prior version of the agreement to make certain clarifying updates to the redemption rights included therein.

Advisory Agreement

On April 1, 2024, the Company entered into the Advisory Agreement with the Operating Partnership and the Adviser. Pursuant to the Advisory Agreement, the Adviser is responsible for sourcing, evaluating and monitoring the Company’s investment opportunities and making decisions related to the acquisition, management, financing and disposition of the Company’s assets, in accordance with the Company’s investment objectives, guidelines, policies and limitations, subject to oversight by the Company’s board of trustees.

On April 28, 2025, the Company, the Operating Partnership and the Adviser amended and restated the Advisory Agreement, to make certain updates to reflect the designation of the new Class F-IO shares and Class IO shares.

Certain affiliates of the Company, including the Adviser, receives fees and compensation in connection with the offering and ongoing management of the assets of the Company. The Company pays the Adviser a management fee equal to (1) 0.50% of NAV of Class F-S shares and Class F-I shares, plus (2) 1.25% of NAV for shares classes other than the Class F-S shares and Class F-I shares, except Class E shares, in each case, per annum payable monthly. Additionally, to the extent that the Operating Partnership issues Operating Partnership units to parties other than the Company, the Operating Partnership pays the Adviser a management fee equal to (1) 0.50% of the NAV of the Operating Partnership attributable to Class F-S and Class F-I units not held by the Company, plus (2) 1.25% of NAV of the Operating Partnership attributable to units other than Class F-S and Class F-I units not held by the Company except Class E Operating Partnership units, in each case, per annum payable monthly in arrears. The management fee may be paid, at the Adviser’s election, in cash, Class E shares or Class E Operating Partnership units, or any combination thereof. The Adviser agreed to waive the management fee through April 1, 2025, which is 12 months following the initial closing of the Offering, and further waived the management fee through December 31, 2025. During the three months ended March 31, 2026, the Company incurred management fees of $2,173, which is recorded in the condensed consolidated statements of operations. During the three months ended March 31, 2026, the Company paid $1,398 in management fees, through the issuance of 67,859 Class E shares, at the applicable NAV per share at the end of the month that the management fee was earned, to the Adviser. All 67,859 Class E shares issued to the Adviser were repurchased by the Company on March 31, 2026.

In addition, so long as the Advisory Agreement has not been terminated between the Company and the Adviser, the Special Limited Partner holds a performance participation interest in the Operating Partnership that entitles it to receive in the aggregate an allocation from the Operating Partnership equal to 12.5% of the Total Return with respect to all of the Operating Partnership units, except Class E Operating Partnership units, subject to a 5% Hurdle Amount and a High Water Mark with respect to such class of units, with a Catch-Up (each term as defined in the limited partnership agreement of the Operating Partnership). Such allocation are made annually and accrue monthly. Distributions on the performance participation interest may be payable in cash or Class E Operating Partnership units, or any combination thereof, at the election of the Special Limited Partner. The Special Limited Partner agreed to waive the performance participation through April 1, 2025, which is 12 months following the initial closing of the Offering, and further waived the performance participation allocation through December 31, 2025. During the three months ended March 31, 2026, the Company incurred a performance participation allocation of $4,068, which is recorded in the condensed consolidated statements of operations, all of which is payable as of March 31, 2026.

The Company may retain certain of the Adviser’s affiliates, from time to time, for services relating to its investments or its operations, which may include accounting and audit services (including valuation support services), account management services, corporate secretarial services, data management services, trusteeship services, information technology services, finance/budget services, human resources, judicial processes, legal services, operational services, risk management services, tax services, treasury services, loan management services, construction management services, property management services, leasing services, property, title and/or other types of insurance and related services, transaction support services, transaction consulting services and other similar operational matters. The Operating Partnership or its subsidiary may also issue equity incentives to certain employees of such affiliates. Any payments made to the Adviser’s affiliates will not reduce the management fee or performance participation allocation. Any such

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arrangements will be at or below market rates. As of March 31, 2026 and December 31, 2025, the Company has not retained an affiliate of the Adviser for any such services.

11. Leases

The Company’s rental revenue primarily consists of rent earned from operating leases in the Company’s net leased portfolio which consists of fixed annual rents that escalates annually throughout the term of the leases, and the tenants are generally responsible for all property-related expenses, including taxes, insurance, and maintenance. As of March 31, 2026 and December 31, 2025, the Company's investments in real estate are leased to single tenants on a net lease basis.

The following table details the components of operating lease income from the leases of which the Company is the lessor:


	For the Three Months Ended March 31,
	2026		2025
Fixed lease payments	$	33,116	$	10,190
Straight-line rent adjustment		4,114		921
Variable lease payments(1)		3,522		1,529
Amortization of (above)- and below-market leases, net		378		357
Total rental revenue:	$	41,130	$	12,997

(1)

Consists of tenant reimbursements.

The following table presents the undiscounted future minimum rents the Company expects to receive from its net lease properties classified as operating leases as of March 31, 2026:


Year	Future Minimum Rents(1)
2026 (Remaining)	$	100,656
2027		139,114
2028		159,027
2029		163,097
2030		154,848
Thereafter		1,252,262
Total:	$	1,969,004

(1)

Aggregate base rents of $476,193 related to executed leases that have not yet commenced are excluded.

12. Equity

As of March 31, 2026, the Third Amended and Restated Declaration of Trust of the Company, dated March 5, 2026, authorized the Company to issue an unlimited number of common shares, including an unlimited number of shares classified as Class T shares, Class F-T shares, Class S shares, Class F-S shares, Class D shares, Class F-D shares, Class I shares, Class F-I shares, and Class E shares, and an unlimited number of shares classified as preferred shares of beneficial interest, par value $0.01 per share (“preferred shares”).

The share classes have different upfront selling commissions, dealer manager fees, ongoing shareholder servicing fees and gross distributions, as well as different management fees and performance participation allocations. Refer to "Note 10. Related Party Transactions" for more information.

The below table details shares issued and outstanding for the classes of common shares outstanding as of March 31, 2026 and December 31, 2025:

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Share Class	March 31, 2026		December 31, 2025
Class S common shares, $0.01 par value per share		15,034,345		11,271,609
Class F-S common shares, $0.01 par value per share		18,213,038		18,363,286
Class I common shares, $0.01 par value per share		8,893,474		7,043,621
Class F-I common shares, $0.01 par value per share		11,098,425		10,741,516
Class E common shares, $0.01 par value per share		6,146,147

North Haven Net REIT 10-Q