BROAD STREET REALTY, INC. Management’s Discussion and Analysis of Financial Condition and Results of Operations (form 10-Q)

The following discussion should be read together with the consolidated financial
statements and notes thereto appearing elsewhere in this report. References to
"we," "our," "us," and "Company" refer to Broad Street Realty, Inc., together
with its consolidated subsidiaries.

Forward-Looking Statements


We make statements in this Quarterly Report on Form 10-Q (this "report") that
are forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of
1933, as amended (the "Securities Act"), and Section 21E of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")). These forward-looking
statements include, without limitation, statements about our estimates,
expectations, predictions and forecasts of our future business plans and
financial and operating performance and/or results, as well as statements of
management's goals and objectives and other similar expressions concerning
matters that are not historical facts. When we use the words "may," "should,"
"could," "would," "predicts," "potential," "continue," "expects," "anticipates,"
"future," "intends," "plans," "believes," "estimates," "project," "seek," or
similar expressions or their negatives, as well as statements in future tense,
we intend to identify forward-looking statements. Although we believe that the
expectations reflected in such forward-looking statements are based upon
reasonable assumptions, beliefs and expectations, such forward-looking
statements are not predictions of future events or guarantees of future
performance, and our actual financial and operating results could differ
materially from those set forth in the forward-looking statements. Some factors
that might cause such differences are described in Item 1A. Risk Factors in our
Annual Report on Form 10-K for the year ended December 31, 2021 and in other
documents that we file from time to time with the Securities and Exchange
Commission (the "SEC"), which factors include, without limitation, the
following:

our limited access to capital and our ability to repay, refinance, restructure
and/or extend our indebtedness as it becomes due?

risks associated with our ability to consummate the pending acquisitions, the
timing and closing of such transactions and unexpected costs or unexpected
liabilities that may arise from the transactions, whether or not consummated?

risks related to disruption of management’s attention from its ongoing business
operations due to the pending transactions?

our ability to recognize the benefits of the completed and pending acquisitions;

our success in implementing our business strategy and our ability to identify,
underwrite, finance, consummate and integrate acquisitions or investments?

adverse economic or real estate developments, either nationally or in the
markets in which our properties are located;

changes in financial markets, interest rates and inflation, or to our business
or financial condition?

the nature and extent of our competition?

other factors affecting the retail industry or the real estate industry
generally;

availability of financing and capital?

the performance of our portfolio? and

the impact of any financial, accounting, legal or regulatory issues or
litigation, including any legal proceedings, regulatory matters or enforcement
matters that have been or in the future may be instituted relating to the merger
transactions or that may affect us.

Given these uncertainties, undue reliance should not be placed on our
forward-looking statements. We assume no duty or responsibility to publicly
update or revise any forward-looking statement that may be made to reflect
future events or circumstances or to reflect the occurrence of unanticipated
events. We urge you to review the disclosures concerning risks in Item 1A. Risk
Factors in our Annual Report on Form 10-K for the year ended December 31, 2021
for further discussion of these and other risks, as well as the risks,
uncertainties and other factors discussed in this report and identified in other
documents we file with the SEC from time to time. You should carefully consider
these risks before making any investment decisions in the Company. New risks and
uncertainties may also emerge from time to time that could materially and
adversely affect us.

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Overview


We are focused on owning and managing essential grocery-anchored and mixed-use
assets located in densely populated technology employment hubs and higher
education centers within the Mid-Atlantic, Southeast and Colorado markets. As of
September 30, 2022, we owned 15 properties with an additional three properties
under contract to be acquired. The properties in our portfolio and the
properties we have under contract are dispersed in sub-markets that we believe
generally have high population densities, high traffic counts, good visibility
and accessibility, which provide our tenants with attractive locations to serve
the necessity-based needs of the surrounding communities. We intend to focus on
acquiring additional strategically positioned properties in established and
developing neighborhoods primarily leased to necessity-based tenants that meet
the needs of the surrounding communities in our existing markets, as well as
acquiring properties in new markets that meet our investment criteria, including
the Southeastern United States. In addition, we provide commercial real estate
brokerage services for our own portfolio and third-party office, industrial and
retail operators and tenants.

The table below provides certain information regarding our portfolio as of
September 30, 2022 and December 31, 2021. For additional information, see "-Our
Portfolio."

                                                               As of                   As of
                                                        September 30, 2022       December 31, 2021
Number of properties                                                     15                      15
Number of states                                                          5                       5
Total square feet (in thousands)                                      1,735                   1,737
Anchor spaces                                                           916                     917
Inline spaces                                                           819                     820
Leased % of rentable square feet (1):
Total portfolio                                                        91.3 %                  88.1 %
Anchor spaces                                                          94.2 %                  94.3 %
Inline spaces                                                          88.0 %                  81.3 %
Occupied % of rentable square feet (1):
Total portfolio                                                        86.6 %                  84.7 %
Anchor spaces                                                          91.9 %                  91.9 %
Inline spaces                                                          80.6 %                  76.7 %
Average remaining lease term (in years) (2)                             4.7                     4.7
Annualized base rent per leased square feet (3)         $             14.09     $             13.83


(1)

Percent leased is calculated as (a) gross leasable area ("GLA") of rentable
commercial square feet occupied or subject to a lease as of September 30, 2022
or December 31, 2021, as applicable, divided by (b) total GLA September 30, 2022
or December 31, 2021, as applicable, expressed as a percentage. The total
percent occupied, which excludes leases that have been signed but not commenced,
was 86.6% and 84.7% as of September 30, 2022 and December 31, 2021,
respectively.
(2)
The average remaining lease term (in years) excludes the future options to
extend the term of the lease.
(3)
Annualized base rent per leased square foot is calculated as total annualized
base rent divided by leased GLA as of September 30, 2022 or December 31, 2021,
as applicable.

We are structured as an "Up-C" corporation with substantially all of our
operations conducted through Broad Street Operating Partnership, LP (our
"Operating Partnership") and its direct and indirect subsidiaries. As of
September 30, 2022, we owned 92.3% of the units of limited partnership interest
in the Operating Partnership ("OP units"), and we are the sole member of the
sole general partner of our Operating Partnership. We began operating in our
current structure on December 27, 2019 upon the completion of certain mergers
that were part of the previously announced series of mergers (collectively, the
"Mergers") on such date, and we operate as a single reporting segment.

Impact of COVID-19


We continue to monitor and address risks related to the COVID-19 pandemic.
Certain tenants experiencing economic difficulties during the pandemic have
previously sought rent relief, which had been provided on a case-by-case basis
primarily in the form of rent deferrals and, in more limited cases, in the form
of rent abatements. Since April 2020, we have entered into lease modifications
that deferred approximately $0.6 million and waived approximately $0.3 million
of contractual revenue for rent that pertained to April 2020 through December
2021; we had no lease modifications related to COVID-19 during the nine months
ended September 30, 2022. Approximately less than $0.1 million of the total
deferred rent from all lease modifications since April 2020 remained outstanding
and to be billed as of September 30, 2022 and has a weighted average payback
period of approximately 27 months. As of November 14, 2022, we have given rent
deferrals to 36 tenants (approximately 11.1% of our total tenants) with one
tenant still on a payment plan.

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Portfolio Summary


As of September 30, 2022, our portfolio was comprised of 15 retail properties
consisting of 1,735,171 total square feet of GLA. The following table provides
additional information about the properties in our portfolio.

                                      Year                                                Total           Annualized Base        Percentage of           Gross Real
                                     Built /                           Percent          Annualized        Rent per Leased       Total Annualized  

Estate Assets
Property Name City/State Renovated (1) GLA Leased (2) Base Rent (3)

           SF (4)               Base Rent           (in thousands)
Avondale Shops    Washington,
                     D.C.                   2010          28,308            100.0 %   $      658,078     $           23.25                    2.9 %   $          8,439
Brookhill
Azalea
Shopping
Center           Richmond, VA               2012         163,353             88.7 %        1,554,243                 10.73                    7.0 %     

17,404

Coral Hills
Shopping            Capitol
Center            Heights, MD               2012          85,001            100.0 %        1,448,701                 17.04                    6.5 %             16,683
Crestview
Square
Shopping           Landover
Center             Hills, MD                2012          74,694            100.0 %        1,468,731                 19.66                    6.6 %    

18,653

Cromwell Field
Shopping         Glen Burnie,
Center                MD                    2020         233,486             67.2 %        1,627,780                 10.37                    7.3 %     

18,664

Dekalb Plaza East

                 Norriton, PA               2017         178,356             97.8 %        2,030,265                 11.64                    9.1 %     

28,448

The Shops at
Greenwood          Greenwood
Village           Village, CO               2019         198,822             98.4 %        3,323,189                 16.99                   14.9 %             31,790
Highlandtown
Village
Shopping
Center           Baltimore, MD              1987          57,524             89.8 %          960,751                 18.60                    4.3 %              7,402
Hollinswood
Shopping
Center           Baltimore, MD              2020         112,648             92.0 %        1,711,815                 16.52                    7.7 %             25,402
Lamar Station
Plaza East       Lakewood, CO               1984          42,700             85.7 %          556,998                 15.22                    2.5 %              6,195
Midtown          Williamsburg,
Colonial              VA                    2018          98,067             85.7 %          998,599                 11.88                    4.5 %             16,809
Midtown          Williamsburg,
Lamonticello          VA                    2019          63,157             92.5 %          952,971                 16.30                    4.2 %             16,279
Spotswood
Valley Square
Shopping         Harrisonburg,
Center                VA                    1997         190,646            100.0 %        1,896,030                  9.95                    8.5 %     

14,675

Vista Shops at
Golden Mile      Frederick, MD              2009          98,858             98.4 %        1,735,781                 17.84                    7.8 %             14,937
West Broad
Commons
Shopping
Center           Richmond, VA               2017         109,551             93.3 %        1,397,552                 13.67                    6.2 %             20,014
Total                                                  1,735,171             91.3 %   $   22,321,484     $           14.09                  100.0 %   $        261,794



(1)
Represents the most recent year in which a property was built or renovated. For
purposes of this table, renovation means significant upgrades, alterations or
additions to the property.
(2)
Percent leased is calculated as (a) GLA of rentable commercial square feet
occupied or subject to a lease as of September 30, 2022, divided by (b) total
GLA, expressed as a percentage. The total percent occupied, which excludes
leases that have been signed but not commenced, was 86.6% as of September 30,
2022.
(3)
Total annualized base rent is calculated by multiplying (a) monthly base rent
(before abatements) as of September 30, 2022, for leases that had commenced as
of such date, by (b) 12. Total annualized base rent does not include tenant
reimbursements for real estate taxes, insurance, common area maintenance or
other operating expenses.
(4)
Annualized base rent per leased square foot is calculated as total annualized
base rent divided by leased GLA as of September 30, 2022.

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Geographic Concentration

The following table contains information regarding the geographic concentration
of the properties in our portfolio as of September 30, 2022, which includes
rental income for the nine months ended September 30, 2022 and 2021.


                    Number                           Percentage of
(dollars in           of          Gross Real       Total Real Estate      Rental income for the nine months ended
thousands)        Properties    Estate Assets            Assets                        September 30,
                   September    September 30,
Location           30, 2022          2022          September 30, 2022          2022                     2021
Maryland(1)            6        $      101,741                   38.9 %   $        9,579           $         7,342
Virginia               5                85,181                   32.5 %            5,502                     4,456
Pennsylvania           1                28,448                   10.9 %            1,589                     1,909
Washington D.C.        1                 8,439                    3.2 %              495                       423
Colorado               2                37,985                   14.5 %            3,869                       499
                      15        $      261,794                  100.0 %   $       21,034           $        14,629


(1) Rental income for the nine months ended September 30, 2021 includes less
than $0.1 million of ground rental revenue under the ground lease for the parcel
of land acquired in January 2020. The ground lease was terminated upon the
completion of the Cromwell Field Shopping Center Merger on May 26, 2021.

Critical Accounting Policies


Refer to our audited consolidated financial statements and notes thereto for the
year ended December 31, 2021 for a discussion of our accounting policies,
including the critical accounting policies of revenue recognition, real estate
investments, asset impairment, income taxes, and our accounting policy on
consolidation, which are included in our 2021 Annual Report on Form 10-K, which
was filed with the SEC on April 15, 2022. During the nine months ended September
30, 2022, there were no material changes to these policies. See Note 2 "-Recent
Accounting Pronouncements" to our consolidated financial statements in Item 1 of
this report for recently-adopted accounting pronouncements.

Factors that May Impact Future Results of Operations

Rental Income


Growth in rental income will depend on our ability to acquire additional
properties that meet our investment criteria and on filling vacancies and
increasing rents on the properties in our portfolio. The amount of rental income
generated by the properties in our portfolio depends on our ability to renew
expiring leases or re-lease space upon the scheduled or unscheduled termination
of leases, lease currently available space and maintain or increase rental rates
at our properties. Our rental income in future periods could be adversely
affected by local, regional, or national economic conditions, an oversupply of
or a reduction in demand for retail space, changes in market rental rates, our
ability to provide adequate services and maintenance at our properties, and
fluctuations in interest rates. In addition, economic downturns affecting our
markets or downturns in our tenants' businesses that impair our ability to renew
or re-lease space and the ability of our tenants to fulfill their lease
commitments to us could adversely affect our ability to maintain or increase
rent and occupancy.

Scheduled Lease Expirations

Our ability to re-lease expiring space at rental rates equal to or greater than
that of current rental rates will impact our results of operations. Our
properties are marketed to smaller tenants that generally desire shorter-term
leases. As of September 30, 2022, approximately 45.5% of our portfolio (based on
GLA) was leased to tenants occupying less than 10,000 square feet. In addition,
as of September 30, 2022, approximately 8.7% of our GLA was vacant and
approximately 10.8% of our leases (based on GLA) were scheduled to expire on or
before December 31, 2023. Although we maintain ongoing dialogue with our
tenants, we generally raise the issue of renewal at least 12 months prior to
lease renewal often providing concessions for early renewal. If our current
tenants do not renew their leases or terminate their leases early, we may be
unable to re-lease the space to new tenants on favorable terms or at all. Our
vacancy trends will be impacted by new properties that we acquire, which may
include properties with higher vacancy where we identified opportunities to
increase occupancy.

Acquisitions


Over the long-term, we intend to grow our portfolio through the acquisition of
additional strategically positioned properties in established and developing
neighborhoods primarily leased to necessity-based tenants that meet the needs of
the surrounding communities in our existing markets, as well as acquiring
properties in new markets that meet our investment criteria, including the
Southeastern United States. We have established relationships with a wide
variety of market participants, including tenants, leasing agents, investment
sales brokers, property owners and lenders, in our target markets and beyond,
and, over the long-term, we believe that we will have opportunities to acquire
properties that meet our investment criteria at attractive prices.

On December 21, 2021, we entered into a purchase and sale agreement (the "MTR
Agreement") with BBL Current Owner, LLC ("BBL Current") to acquire a mixed-use
property in Williamsburg, Virginia known as Midtown Row for a purchase price of
$122.0 million in cash (the "Midtown Row Acquisition"). On July 1, 2022, the MTR
Agreement automatically terminated in accordance with

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its terms as a result of the closing not occurring by June 30, 2022. On
September 1, 2022, we entered into a third amendment and reinstatement of the
MTR Agreement (the "MTR Amendment") with BBL Current, pursuant to which the MTR
Agreement was fully reinstated, subject to the terms of the MTR Amendment. The
MTR Amendment increased the purchase price for the Midtown Row Acquisition to
$123.3 million. Pursuant to the terms of the MTR Amendment, the purchase price
will be paid in cash and not less than $5.0 million of common OP units and newly
designated Series A convertible preferred OP units ("Preferred Units"). The
common OP units and Preferred Units will be valued at $2.00 per unit for
purposes of the MTR Agreement.

In connection with the initial execution of the MTR Agreement, we made a deposit
of $0.2 million. Pursuant to the MTR Amendment, we were required to make an
additional deposit of $0.25 million, as well as pledge $0.3 million in
development fees to which one of our subsidiaries is entitled (the "Pledge
Deposit"). In addition, we are required to make an additional deposit of $1.25
million (the "Reserve Deposit") upon the release of certain reserve funds held
by the Basis Lender (as defined below), the payment of which is guaranteed by
us. In the event we default on our obligation to complete the Midtown Row
Acquisition, (i) the Reserve Deposit, if not already provided, will become
immediately due and payable and (ii) we will forfeit all deposits (including the
Pledge Deposit) under the MTR Agreement and the MTR Amendment.

Under the MTR Amendment, the outside closing date of the Midtown Row Acquisition
was extended to November 23, 2022. The Midtown Row Acquisition is subject to
customary closing conditions. There can be no assurances that these conditions
will be satisfied or that we will complete the Midtown Row Acquisition on the
terms described herein or at all.

On February 8, 2022, we entered into a purchase and sale agreement (the "Initial
Colfax Agreement") to acquire a land parcel for a purchase price of $2.5 million
in cash. On July 1, 2022, the Initial Colfax Agreement automatically terminated
in accordance with its terms as a result of the closing not occurring by June
30, 2022. In connection with the termination of the Initial Colfax Agreement, we
forfeited the $0.3 million deposit ("Colfax Land Parcel Acquisition"). On
September 29, 2022, we entered into a second purchase and sale agreement (the
"Second Colfax Agreement") to acquire the initial land parcel for $2.3 million
in cash. Pursuant to the Second Colfax Agreement, we made a deposit of $0.1
million in October 2022. The Second Colfax Agreement is subject to customary
closing conditions. There can be no assurances that these conditions will be
satisfied or that we will complete the Colfax Land Parcel Acquisition on the
terms described herein or at all.

We have terminated the merger agreement related to the Cypress Point property
because we determined the acquisition would not be accretive to our portfolio
due to the performance of the property and the property-owning entity's default
under the mortgage loan secured by the property. Therefore, as of September 30,
2022, we had one remaining pending acquisition (related to the Lamar Station
Plaza property) pursuant to the agreements and plans of merger that were
originally entered into on May 28, 2019. At closing, we will issue an aggregate
of 573,529 OP units as consideration for the acquisition. Until the closing of
the acquisition, we will continue to manage the property and earn a management
fee.

General and Administrative Expenses


General and administrative expenses include employee compensation costs,
professional fees, consulting, and other general administrative expenses. We
expect that our general and administrative expenses will rise in some measure as
our portfolio grows but that such expenses as a percentage of our revenue will
decrease over time due to efficiencies and economies of scale.

Capital Expenditures


We incur capital expenditures at our properties that vary in amount and
frequency based on each property's specific needs. We expect our capital
expenditures will be for recurring maintenance to ensure our properties are in
good working condition, including parking and roof repairs, façade maintenance
and general upkeep. We also will incur capital expenditures related to
repositioning and refurbishing properties where we have identified opportunities
to improve our properties to increase occupancy, and we may incur capital
expenditures related to redevelopment or development consistent with our
business and growth strategies.

Results of Operations

This section provides a comparative discussion on our results of operations and
should be read in conjunction with our

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consolidated financial statements, including the accompanying notes.


Comparison of the three months ended September 30, 2022 to the three months
ended September 30, 2021

                                             For the Three Months Ended                Change
                                            September          September
(dollars in thousands)                       30, 2022           30, 2021          $             %
Revenues
Rental income                              $      7,369       $      5,875     $  1,494            25 %
Commissions                                         413                854         (441 )         (52 %)
Management fees and other income                    149                278         (129 )         (46 %)
Total revenues                                    7,931              7,007          924            13 %
Expenses
Cost of services                                    315                557         (242 )         (43 %)
Depreciation and amortization                     4,029              3,426          603            18 %
Property operating                                1,926              1,426          500            35 %
Bad debt expense (recoveries)                        12                (31 )         43          (139 %)
General and administrative                        3,053              2,781          272            10 %
Total operating expenses                          9,335              8,159        1,176            14 %
Operating loss                                   (1,404 )           (1,152 )       (252 )          22 %

Other income (expense)
Interest and other income                             -                  1           (1 )        (100 %)
Derivative fair value adjustment                  1,249                 50        1,199         2,398 %
Interest expense                                 (3,073 )           (2,387 )       (686 )          29 %
Gain on extinguishment of debt                        -                773         (773 )        (100 %)
Other expense                                        (9 )                -           (9 )         100 %
Total other expense                              (1,833 )           (1,563 )       (270 )          17 %

Income tax benefit                                  795                673          122            18 %
Net loss                                   $     (2,442 )     $     (2,042 )   $   (400 )          20 %
Plus: Net loss attributable to
noncontrolling interest                             202                222          (20 )          (9 %)
Net loss attributable to common
stockholders                               $     (2,240 )     $     (1,820 

) $ (420 ) 23 %



Revenues for the three months ended September 30, 2022 increased approximately
$0.9 million, or 13%, compared to the three months ended September 30, 2021, as
a result of an approximately $1.5 million increase in rental income. This
increase was partially offset by approximately $0.4 million and $0.1 million
decreases in commissions and management fees and other income, respectively.
Rental income primarily increased as a result of the acquisition of one property
in the fourth quarter of 2021. The decrease in commissions is due to a lower
transaction volume of leasing. The decrease in management fees and other income
is mainly attributable to fees recognized in 2021 related to properties that
were acquired by the Company in the fourth quarter of 2021 and development fees
recognized during the third quarter of 2021.

Total operating expenses for the three months ended September 30, 2022 increased
approximately $1.2 million, or 14%, compared to the three months ended September
30, 2021, primarily from: (i) an increase in depreciation and amortization
expense of approximately $0.6 million, primarily related to one property that
was acquired in October 2021 (which comprised $0.8 million of the total
depreciation and amortization expense, partially offset by a $0.2 million
decrease in amortization of in-place lease tangibles); (ii) an increase in
property operating expense of approximately $0.5 million, which is mainly
attributable to one property acquired in the fourth quarter of 2021; and (iii)
an increase in general and administrative expenses of approximately $0.3
million, which is mainly attributable to an increase in stock compensation
expense.

The gain on derivative fair value adjustment was approximately $1.2 million for
the three months ended September 30, 2022 compared to less than $0.1 million for
the three months ended September 30, 2021. The increase of $1.2 million was
primarily due to the interest rate swaps we entered into on July 1, 2021 and
December 27, 2019.

Interest expense for the three months ended September 30, 2022 increased
approximately $0.7 million, or 29%, compared to the three months ended September
30, 2021, primarily due to debt that was originated in connection with a
property that was acquired in the fourth quarter of 2021. We had additional net
borrowings of approximately $20.9 million after September 30, 2021.

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Net loss attributable to noncontrolling interest for the three months ended
September 30, 2022 decreased less than $0.1 million compared to the three months
ended September 30, 2021. The net loss attributable to noncontrolling interest
reflects the proportionate share of the OP units held by outside investors in
the operating results of the Operating Partnership.

Comparison of the nine months ended September 30, 2022 to the nine months ended
September 30, 2021

                                              For the Nine Months Ended                Change
                                            September          September
(dollars in thousands)                       30, 2022           30, 2021           $             %
Revenues
Rental income                              $     21,034       $     14,629     $   6,405            44 %
Commissions                                       2,142              2,060            82             4 %
Management fees and other income                    450                934          (484 )         (52 %)
Total revenues                                   23,626             17,623         6,003            34 %
Expenses
Cost of services                                  1,588              1,346           242            18 %
Depreciation and amortization                    12,240              8,415         3,825            45 %
Property operating                                5,924              3,873         2,051            53 %
Bad debt expense                                     47                 15            32           213 %
General and administrative                       10,150              7,844         2,306            29 %
Total operating expenses                         29,949             21,493         8,456            39 %
Operating loss                                   (6,323 )           (3,870 )      (2,453 )          63 %

Other income (expense)
Interest and other income                            26                  8            18           225 %
Derivative fair value adjustment                  3,819                261         3,558         1,363 %
Interest expense                                 (8,346 )           (7,346 )      (1,000 )          14 %
Gain on extinguishment of debt                        -              1,530        (1,530 )        (100 %)
Other expense                                       (15 )              (12 )          (3 )          25 %
Total other expense                              (4,516 )           (5,559 )       1,043           (19 %)

Income tax benefit                                2,309              2,316            (7 )          (0 %)
Net loss                                   $     (8,530 )     $     (7,113 )   $  (1,417 )          20 %
Plus: Net loss attributable to
noncontrolling interest                             719                886          (167 )         (19 %)
Net loss attributable to common
stockholders                               $     (7,811 )     $     (6,227 

) $ (1,584 ) 25 %



Revenues for the nine months ended September 30, 2022 increased approximately
$6.0 million, or 34%, compared to the nine months ended September 30, 2021, as a
result of an approximately $6.4 million increase in rental income and $0.1
million increase in commissions. These increases were partially offset by an
approximately $0.5 million decrease in management fees and other income. Rental
income increased primarily as a result of the acquisition of three properties in
the second quarter of 2021 and one property in the fourth quarter of 2021. The
increase in commissions is due to a larger transaction volume of leasing. The
decrease in management fees and other income is mainly attributable to fees
recognized in 2021 related to properties that were acquired by the Company in
the second quarter and fourth quarter of 2021.

Total operating expenses for the nine months ended September 30, 2022 increased
approximately $8.5 million, or 39%, compared to the nine months ended September
30, 2021, primarily from: (i) an increase in depreciation and amortization
expense of approximately $3.8 million, primarily related to four properties that
were acquired since May 2021 (which comprised $4.1 million of the total
depreciation and amortization expense, partially offset by a $0.4 million
decrease in amortization of in-place lease tangibles); (ii) an increase in
general and administrative expenses of approximately $2.3 million mainly
attributable to an increase in stock compensation expense of approximately $1.3
million, an increase in payroll and related expenses of approximately $0.4
million, an increase in real estate related acquisition costs of approximately
$0.3 million due to writing off pre-acquisition costs relating to the Colfax
land parcel, an increase in professional fees of approximately $0.1 million and
an increase in board of directors fees of approximately $0.1 million; and (iii)
an increase in property operating expense of approximately $2.1 million, which
is mainly attributable to the three properties acquired in the second quarter of
2021 and one property in the fourth quarter of 2021.

The gain on derivative fair value adjustment was approximately $3.8 million for
the nine months ended September 30, 2022 compared to $0.3 million for the nine
months ended September 30, 2021. The increase of $3.6 million was primarily due
to the interest rate swaps we entered into on July 1, 2021 and December 27,
2019.

Interest expense for the nine months ended September 30, 2022 increased
approximately $1.0 million, or 14%, compared to the nine months ended September
30, 2021, primarily due to debt that was assumed or originated in connection
with four properties that were acquired during 2021. We had additional net
borrowings of approximately $20.9 million after September 30, 2021.

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The gain on extinguishment of debt of approximately $1.5 million for the nine
months ended September 30, 2021 is related to the forgiveness of an unsecured
loan of approximately $1.5 million pursuant to the Paycheck Protection Program
(the "PPP Program") which was established under the Coronavirus Aid, Relief, and
Economic Security Act.

Net loss attributable to noncontrolling interest for the nine months ended
September 30, 2022 decreased approximately $0.2 million compared to the nine
months ended September 30, 2021. The net loss attributable to noncontrolling
interest reflects the proportionate share of OP units held by outside investors
in the operating results of the Operating Partnership.

Non-GAAP Performance Measures


We present the non-GAAP performance measures set forth below. These measures
should not be considered as an alternative to, or more meaningful than, net
income (calculated in accordance with U.S. generally accepted accounting
principles ("GAAP")) or other GAAP financial measures, as an indicator of
financial performance and are not alternatives to, or more meaningful than, cash
flow from operating activities (calculated in accordance with GAAP) as a measure
of liquidity. Non-GAAP performance measures have limitations as they do not
include all items of income and expense that affect operations, and accordingly,
should always be considered as supplemental financial results to those
calculated in accordance with GAAP. Our computation of these non-GAAP
performance measures may differ in certain respects from the methodology
utilized by other real estate companies and, therefore, may not be comparable to
similarly titled measures presented by other real estate companies. Investors
are cautioned that items excluded from these non-GAAP performance measures are
relevant to understanding and addressing financial performance.

Funds From Operations and Adjusted Funds from Operations


Funds from operations ("FFO") is a supplemental non-GAAP financial measure of
real estate companies' operating performance. The National Association of Real
Estate Investment Trusts ("Nareit") defines FFO as follows: net income (loss),
computed in accordance with GAAP, excluding (i) depreciation and amortization
related to real estate, (ii) gains and losses from the sale of certain real
estate assets, (iii) gains and losses from change in control, (iv) impairment
write-downs of certain real estate assets and investments in entities when the
impairment is directly attributable to decreases in the value of depreciable
real estate held by the entity and (v) after adjustments for unconsolidated
partnerships and joint ventures calculated to reflect FFO on the same basis.

Historical cost accounting for real estate assets in accordance with GAAP
implicitly assumes that the value of real estate assets diminishes predictably
over time. Since real estate values instead have historically risen or fallen
with market conditions, many industry investors and analysts have considered the
presentation of operating results for real estate companies that use historical
cost accounting to be insufficient by themselves. Considering the nature of our
business as a real estate owner and operator, we believe that FFO is useful to
investors in measuring our operating and financial performance because the
definition excludes items included in net income that do not relate to or are
not indicative of our operating and financial performance, such as depreciation
and amortization related to real estate, and items which can make periodic and
peer analysis of operating and financial performance more difficult, such as
gains and losses from the sale of certain real estate assets and impairment
write-downs of certain real estate assets. Specifically, in excluding real
estate related depreciation and amortization and gains and losses from sales of
depreciable operating properties, which do not relate to or are not indicative
of operating performance, FFO provides a performance measure that, when compared
year over year, captures trends in occupancy rates, rental rates and operating
costs.

However, because FFO excludes depreciation and amortization and captures neither
the changes in the value of our properties that result from use or market
conditions nor the level of capital expenditures and leasing commissions
necessary to maintain the operating performance of our properties, all of which
have real economic effects and could materially impact our results from
operations, the utility of FFO as a measure of our performance is limited.
Accordingly, FFO should be considered only as a supplement to net income as a
measure of our performance. FFO should not be used as a measure of our
liquidity, nor is it indicative of funds available to fund our cash needs,
including our ability to pay dividends or service indebtedness. Also, FFO should
not be used as a supplement to or substitute for cash flow from operating
activities computed in accordance with GAAP.

Adjusted FFO ("AFFO") is calculated by excluding the effect of certain items
that do not reflect ongoing property operations, including stock-based
compensation expense, deferred financing and debt issuance cost amortization,
non-real estate depreciation and amortization, straight-line rent and other
non-comparable or non-operating items. Management considers AFFO a useful
supplemental performance metric for investors as it is more indicative of the
Company's operational performance than FFO.

AFFO is not intended to represent cash flow or liquidity for the period and is
only intended to provide an additional measure of our operating performance. We
believe that Net income/(loss) is the most directly comparable GAAP financial
measure to AFFO. Management believes that AFFO is a widely recognized measure of
the operations of real estate companies and presenting AFFO enables investors to
assess our performance in comparison to other real estate companies. AFFO should
not be considered as an alternative to net income/(loss) (determined in
accordance with GAAP) as an indication of financial performance, or as an
alternative to cash flow from operating activities (determined in accordance
with GAAP) as a measure of our liquidity, nor is it indicative of funds
available to fund our cash needs, including our ability to make distributions.

Our reconciliation of net income (loss) to FFO and AFFO for the three and nine
months ended September 30, 2022 and 2021 is as follows:

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                                       For the Three Months Ended             For the Nine Months Ended
                                              September 30,                         September 30,
(dollars in thousands)                  2022                2021              2022                2021
Net loss                            $      (2,442 )     $      (2,042 )   $      (8,530 )     $      (7,113 )
Real estate depreciation and
amortization                                3,933               3,275            11,859               8,067
Amortization of direct leasing
costs                                          17                   2                31                   6
FFO attributable to common shares
and OP units                                1,508               1,235             3,360                 960
Stock-based compensation expense              380                  76             1,566                 220
Deferred financing and debt
issuance cost amortization                    404                 371             1,172                 919
Non-real estate depreciation and
amortization                                    1                   4                13                  14
Recurring capital expenditures               (950 )                47            (1,429 )               (93 )
Straight-line rent revenue                   (234 )                (9 )            (619 )              (291 )
Minimum multiple on preferred
interests                                    (182 )              (379 )            (929 )                45
Non cash derivative fair value
adjustment                                 (1,249 )               (50 )          (3,819 )              (261 )
AFFO attributable to common
shares and OP units                 $        (322 )     $       1,295     $ 

(685 ) $ 1,513


Weighted average shares
outstanding to common shares
Diluted                                32,079,861          28,825,677       

32,030,500 25,399,433


Net loss attributable to common
stockholders per share
Diluted (1)                         $       (0.07 )     $       (0.06 )   $ 

(0.24 ) $ (0.25 )


Weighted average shares
outstanding to common shares and
OP units
Diluted                                34,775,561          31,653,581       

34,769,896 28,227,337


FFO attributable to common shares
and OP units
Diluted (2)                         $        0.04       $        0.04     $        0.10       $        0.03



(1)
The weighted average common shares outstanding used to compute net loss per
diluted common share only includes the common shares. We have excluded the OP
units since the conversion of OP units is anti-dilutive in the computation of
diluted net loss per share for the periods presented.
(2)
The weighted average common shares outstanding used to compute FFO per diluted
common share includes OP units that were excluded from the computation of
diluted net loss per share. Conversion of these OP units is dilutive in the
computation of FFO per diluted common share but is anti-dilutive for the
computation of diluted EPS for the periods presented.

Liquidity and Capital Resources

Overview

Liquidity is a measure of our ability to meet potential cash requirements,
including ongoing commitments to repay any outstanding borrowings, fund and
maintain our assets and operations and other general business needs.

Our short-term liquidity requirements consist primarily of debt service
requirements, operating expenses, recurring capital expenditures (such as
repairs and maintenance of our properties), and non-recurring capital
expenditures (such as capital improvements and tenant improvements). As of
September 30, 2022 and November 7, 2022, we had unrestricted cash and cash
equivalents of approximately $1.6 million and $1.8 million, respectively,
available for current liquidity needs and restricted cash of approximately $5.2
million
and $5.6 million, respectively, which is available for debt service
shortfall requirements, certain capital expenditures, real estate taxes and
insurance.


As of September 30, 2022, we have five mortgage loans and a mezzanine loan on
five properties (Cromwell Field Shopping Center, Lamar Station Plaza East,
Highlandtown Village Shopping Center, Spotswood Valley Square Shopping Center
and Vista Shops at Golden Mile Loan) totaling approximately $46.2 million that
will mature within twelve months of the date that the financial statements
included in this report are issued. One of the mortgage loans with a balance of
$3.5 million as of September 30, 2022 matured on October 17, 2022 and remains
outstanding. The lender gave us a forbearance through November 23, 2022 to repay
the loan. We project that we will not have sufficient cash available to pay off
the other mortgage and mezzanine loans upon maturity, and we are currently
seeking to refinance the loans prior to maturity or cure period in December
2022, May 2023, June 2023 and July 2023. There can be no assurances that we will
be successful in refinancing the mortgage and mezzanine loans on favorable terms
or at all. If we are unable to refinance the mortgage and mezzanine loans, the
lenders have the right to place the loans in default and ultimately foreclose on
the properties. Under this circumstance, we would not have any further financial
obligation to the lenders as the value of these properties are in excess of the
outstanding loan balances.

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The MVB Term Loan, MVB Revolver and Second MVB Term Loan (each as defined below,
and collectively, the "MVB Loans"), totaling approximately $6.7 million as of
September 30, 2022, mature in June 2023. We are required to pay an exit fee to
the lender in an amount equal to two percent multiplied by the aggregate
principal balance of the MVB Loans at the time of the maturity date or just
prior to such repayments. Management is in discussions with other lenders to
refinance the MVB Loans; however, there can be no assurances that we will be
successful in refinancing the MVB Loans.

The Lamont Street Preferred Interest (as defined below) has an outstanding
balance of $4.1 million as of September 30, 2022, with a redemption date of
September 30, 2023. The redemption date can be extended by us to September 30,
2024 and September 30, 2025, in each case subject to certain conditions. There
can be no assurance that we will be successful in exercising these extension
options or refinancing the Lamont Street Preferred Interest prior to its
maturity. If we are unable to extend or refinance the Lamont Street Preferred
Interest prior to the redemption date, Lamont Street (as defined below) may
remove the Operating Partnership as the manager of the BSV Highlandtown and BSV
Spotswood (each as defined below).

In addition, the Basis Term Loan and the Basis Preferred Interest (each as
defined below) totaling approximately $75.0 million mature on January 1, 2023,
subject to two one-year extension options that are subject to certain
conditions, including a material adverse change clause. Management is in
discussions with Basis (as defined below) regarding the exercise of these
extension options and is in discussions with other parties to refinance the
Basis Term Loan and the Basis Preferred Interest with new loans or preferred
equity, which management believes will be available on acceptable terms based on
discussions with lenders and the loan-to-value ratios of the properties securing
the Basis Term Loan. There can be no assurances, however, that we will be
successful in exercising these extension options or refinancing the Basis Term
Loan and the Basis Preferred Interest prior to their maturity. If we are unable
to extend or refinance the Basis Term Loan prior to maturity, the lender will
have the right to place the loan in default and ultimately foreclose on the six
properties securing the loan. If we are unable to extend or redeem the Basis
Preferred Interest prior to the mandatory redemption date, the Preferred
Investor (as defined below) may remove the Operating Partnership as the manager
of the Sub-OP (as defined below) and as the manager of the property-owning
entities held under the Sub-OP.

Although management believes that we will be able to extend or refinance our
debt prior to maturity, including the Basis Term Loan and the Basis Preferred
Interest, it is possible that we may be unable extend or refinance such debt,
which creates substantial doubt about our ability to continue as a going concern
for a period of one year after the date that the financial statements included
in this report are issued. The financial statements included in this report have
been prepared assuming that the Company will continue as a going concern and do
not include any adjustments that might result from the outcome of this
uncertainty.

Our long-term liquidity requirements are expected to consist primarily of funds
necessary for the repayment of debt at or prior to maturity, capital
improvements, development and/or redevelopment of properties and property
acquisitions. We expect to meet our long-term liquidity requirements through net
cash from operations, additional secured and unsecured debt and, subject to
market conditions, the issuance of additional shares of common stock, preferred
stock or OP units.

Our access to capital depends upon a number of factors over which we have little
or no control, including general market conditions, the market's perception of
our current and potential future earnings and cash distributions, our current
debt levels and the market price of the shares of our common stock. Although our
common stock is quoted on the OTCQX Best Market, there is a very limited trading
market for our common stock, and if a more active trading market is not
developed and sustained, we will be limited in our ability to issue equity to
fund our capital needs. If we cannot obtain capital from third-party sources, we
may not be able to acquire or develop properties when strategic opportunities
exist, meet the capital and operating needs of our existing properties, satisfy
our debt service obligations or pay dividends to our stockholders. Until we have
greater access to capital, we will likely structure future acquisitions through
joint ventures or other syndicated structures in which outside investors will
contribute a majority of the capital and we will manage the assets.

As described below, under our existing debt agreements, we are subject to
continuing covenants. In the event of a default, the lenders could accelerate
the timing of payments under the applicable debt obligations, and we may be
required to repay such debt with capital from other sources, which may not be
available on attractive terms, or at all, which would have a material adverse
effect on our liquidity, financial condition and results of operations. As of
September 30, 2022, we were in compliance with all of the other covenants under
our debt agreements.

Consolidated Indebtedness and Preferred Equity

Indebtedness Summary

The following table sets forth certain information regarding our outstanding
indebtedness as of September 30, 2022:

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                                                                                    Balance
                                                                                Outstanding at
                                  Maturity                          Interest     September 30,
(dollars in thousands)              Date           Rate Type        Rate (1)         2022
Basis Term Loan (net of          January 1,
discount of $84)                    2023          Floating (2)       6.125%    $          67,100
Basis Preferred Interest (net    January 1,                          14.00%
of discount of $18) (3)           2023 (4)           Fixed            (5)                  7,883
                                  June 27,
MVB Term Loan                     2023 (6)           Fixed           6.75%                 3,663
                                  June 27,
Second MVB Term Loan                2023             Fixed           6.75%                 2,000
                                  June 27,
MVB Revolver                      2023 (6)        Floating (7)       7.75%                 1,047
Hollinswood Shopping Center     December 1,
Loan                                2024       LIBOR + 2.25% (8)     4.06%                12,839
Avondale Shops Loan             June 1, 2025         Fixed           4.00%                 3,013
Vista Shops at Golden Mile
Loan (net of discount of $19)     June 24,
(9)                                 2023             Fixed           3.83%                11,543
Brookhill Azalea Shopping       January 31,
Center Loan                         2025         LIBOR + 2.75%       5.89%                 8,783
                                October 17,
Lamar Station Plaza East Loan    2022 (10)       WSJ Prime (11)      6.14%                 3,516
Lamont Street Preferred
Interest (net of discount of     September
$38) (12)                         30, 2023           Fixed           13.50%                4,330
Highlandtown Village Shopping
Center Loan (net of discount
of $21)                         May 6, 2023          Fixed           4.13%                 5,273
Cromwell Field Shopping
Center Loan (net of discount    December 31,
of $16)                          2022 (13)     LIBOR + 5.40% (14)    8.54%                12,377
Cromwell Field Shopping
Center Mezzanine Loan (net of   December 31,
discount of $2)                  2022 (13)           Fixed           10.00%                1,528
Spotswood Valley Square
Shopping Center Loan (net of
discount of $47)                July 6, 2023         Fixed           4.82%                11,913
The Shops at Greenwood
Village (net of discount of     October 10,
$98)                                2028       Prime - 0.35% (15)    4.08%                22,907
                                                                               $         179,715
Unamortized deferred
financing costs, net                                                                        (579 )
Total Mortgage and Other
Indebtedness                                                                   $         179,136


(1)

At September 30, 2022, the floating rate loans tied to the London Inter-Bank
Offered Rate (“LIBOR”) were based on the one-month LIBOR rate of 3.14%.

(2)

The interest rate for the Basis Term Loan is the greater of (i) SOFR (as defined
below) plus 3.97% per annum and (ii) 6.125% per annum. On August 1, 2022, the
interest rate cap that capped the prior-LIBOR rate was modified to cap the SOFR
rate on this loan at 3.5%.

(3)

The outstanding balance includes approximately $0.1 million of indebtedness
related to the Minimum Multiple Amount (as defined below) owed to the Preferred
Investor as described below under the heading “-Basis Preferred Interest.”

(4)

If the Basis Term Loan is paid in full earlier than its maturity date, the Basis
Preferred Interest in the Sub-OP will mature at that time.

(5)

In June 2020, the Preferred Investor made additional capital contributions of
approximately $2.9 million as described below under the heading "-Basis
Preferred Interest" of which approximately $0.9 million was outstanding at
September 30, 2022. The Preferred Investor is entitled to a cumulative annual
return of 13.0% on the additional contributions.

(6)

In March 2022, we entered into a six-month extension on the MVB Term Loan and
the MVB Revolver as described below under the heading “-MVB Loans.”

(7)

The interest rate on the MVB Revolver is the greater of (i) prime rate plus 1.5%
and (ii) 6.75%.

(8)

We have entered into an interest rate swap which fixes the interest rate of the
loan at 4.06%.

(9)

We completed the refinance of this loan in March 2021. The prior loan matured on
January 25, 2021 and carried an interest rate of LIBOR plus 2.5% per annum.

(10)

In August 2022, we entered into a modification to the Lamar Station Plaza East
loan to extend the maturity date to October 17, 2022, effective July 17, 2022.
The Lamar Station Plaza East loan is still outstanding, and the lender gave us a
forbearance through November 23, 2022 to repay the loan.

(11)

As a result of the loan modification we entered into in August 2022, the
interest rate on the Lamar Station Plaza East loan is Wall Street Journal Prime,
effective July 17, 2022.

(12)

The outstanding balance includes approximately $0.3 million of indebtedness as
of September 30, 2022 related to the Lamont Street Minimum Multiple Amount (as
defined below) owed to Lamont Street as described below under the heading
"-Lamont Street Preferred Interest."

(13)

On November 9, 2022, we entered into a modification to the Cromwell Field
Shopping Center
mortgage and mezzanine loans to extend the maturity dates to
December 31, 2022.

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(14)

The interest rate on the Cromwell Field Shopping Center loan is LIBOR plus 5.40%
per annum with a minimum LIBOR rate of 0.50%.

(15)

The Company entered into an interest rate swap which fixes the interest rate of
this loan at 4.082%


Basis Term Loan

In December 2019, six of our subsidiaries, as borrowers (collectively, the
"Borrowers"), and Big Real Estate Finance I, LLC, a subsidiary of a real estate
fund managed by Basis Management Group, LLC ("Basis"), as lender (the "Basis
Lender"), entered into a loan agreement (the "Basis Loan Agreement") pursuant to
which the Basis Lender made a senior secured term loan of up to $66.9 million
(the "Basis Term Loan") to the Borrowers. Pursuant to the Basis Loan Agreement,
the Basis Term Loan is secured by mortgages on the following properties: Coral
Hills, Crestview, Dekalb, Midtown Colonial, Midtown Lamonticello and West Broad.
The Basis Term Loan matures on January 1, 2023, subject to two one-year
extension options, subject to certain conditions. On June 29, 2022, the Basis
Loan Agreement was amended and restated, effective December 27, 2019, to replace
LIBOR with the Secured Overnight Financing Rate ("SOFR"). The Basis Term Loan
bears interest at a rate equal to the greater of (i) SOFR plus 3.97% per annum
and (ii) 6.125% per annum. The Borrowers had entered into an interest rate cap
that effectively capped the prior-LIBOR rate at 3.50% per annum. On August 1,
2022, the interest rate cap was modified to cap the SOFR rate at 3.50% per
annum. As of September 30, 2022, the interest rate of the Basis Term Loan was
6.125% and the balance outstanding was $66.9 million.

Certain of the Borrowers' obligations under the Basis Loan Agreement are
guaranteed by the Company and by Michael Z. Jacoby, the Company's chairman and
chief executive officer, and Thomas M. Yockey, a director of the Company. The
Company has agreed to indemnify Mr. Yockey for any losses he incurs as a result
of his guarantee of the Basis Term Loan.

The Basis Loan Agreement contains certain customary representations and
warranties and affirmative negative and restrictive covenants, including certain
property related covenants for the properties owned by the Sub-OP, including a
requirement that certain capital improvements be made. The Basis Lender has
certain approval rights over amendments or renewals of material leases (as
defined in the Basis Loan Agreement) and property management agreements for the
properties securing the Basis Term Loan.

If (i) an event of default exists, (ii) the Company's subsidiary serving as the
property manager ("BSR") or any other subsidiary of the Company serving as
property manager for one of the secured parties becomes bankrupt, insolvent or a
debtor in an insolvency proceeding, or there is a change of control of BSR or
such other subsidiary without approval by the Basis Lender, (iii) a default
occurs under the applicable management agreement, or (iv) the property manager
has engaged in fraud, willful misconduct, misappropriation of funds or is
grossly negligent with regard to the applicable property, the Basis Lender may
require a Borrower to replace BSR or such other subsidiary of the Company as the
property manager and hire a third party manager approved by the Basis Lender to
manage the applicable property.

The Borrowers are generally prohibited from selling the properties securing the
Basis Term Loan and the Company is prohibited from transferring any interest in
any of the Borrowers, in each case without consent from the Basis Lender. The
Company is prohibited from engaging in transactions that would result in a
Change in Control (as defined in the Basis Loan Agreement) of the Company. Under
the Basis Loan Agreement, among other things, it is deemed a Change in Control
if Michael Z. Jacoby ceases to be the chairman and chief executive officer of
the Company and actively involved in the daily activities and operations of the
Company and the Borrowers and a competent and experienced person is not approved
by the Basis Lender to replace Mr. Jacoby within 90 days of him ceasing to serve
in such roles.

The Basis Loan Agreement provides for standard events of default, including
nonpayment of principal and other amounts when due, non-performance of
covenants, breach of representations and warranties, certain bankruptcy or
insolvency events and changes in control. If an event of default occurs and is
continuing under the Basis Loan Agreement, the Basis Lender may, among other
things, require the immediate payment of all amounts owed thereunder.

In addition, if there is a default by the Company under the MVB Loan Agreement
(as defined below), by Mr. Jacoby under his guarantee of the loans under the MVB
Loan Agreement or by Mr. Jacoby under a certain personal loan as long as he has
pledged OP units as collateral for such loan, and such default has not been
waived or cured, then the Basis Lender will have the right to sweep the
Borrowers' cash account in which they collect and retain rental payments from
the properties securing the Basis Term Loan on a daily basis in order for the
Basis Lender to create a cash reserve that will serve as collateral for the
Basis Term Loan.

The Basis Loan Agreement includes a debt service coverage calculation based on
the trailing twelve month's results which includes an adjustment for tenants
that are more than one-month delinquent in paying rent. A debt service coverage
ratio below 1.10x is a Cash Trap Trigger Event (as defined in the Basis Loan
Agreement), which gives the Basis Lender the right to institute a cash
management period until the trigger is cured. A debt service coverage ratio
below 1.05x for two consecutive calendar quarters gives the Basis Lender the
right to remove the Company as manager of the properties. The debt service
coverage calculation for the twelve months ended September 30, 2022 was
approximately 1.51x.

                                       37
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Basis Preferred Interest


In December 2019, the Operating Partnership and Big BSP Investments, LLC, a
subsidiary of a real estate fund managed by Basis (the "Preferred Investor"),
entered into an amended and restated operating agreement (the "Sub-OP Operating
Agreement") of Broad Street BIG First OP, LLC, a subsidiary of the Operating
Partnership (the "Sub-OP"). Pursuant to the Sub-OP Operating Agreement, among
other things, the Preferred Investor committed to make an investment of up to
$10.7 million in the Sub-OP, of which $6.9 million had been funded as of
September 30, 2022, in exchange for a 1.0% membership interest in the Sub-OP
designated as Class A units.

Pursuant to the Sub-OP Operating Agreement, the Preferred Investor is entitled
to a cumulative annual return of 14.0% on its initial capital contribution (the
"Class A Return"), and the Preferred Investor will be entitled to a 20% return
(the "Enhanced Class A Return") on any capital contribution made to the Sub-OP
in excess of the $10.7 million commitment. The Preferred Investor's interests
must be redeemed on or before the earlier of: (i) January 1, 2023 and (ii) the
date on which the Basis Term Loan is paid in full (the "Redemption Date"). The
Redemption Date may be extended to December 31, 2023 and December 31, 2024, in
each case subject to certain conditions, including the payment of a fee equal to
0.25% of the Preferred Investor's net invested capital for the first extension
option and a fee of 0.50% of the Preferred Investor's net invested capital for
the second extension option. If the redemption price is paid on or before the
Redemption Date, then the redemption price will be equal to (a) all unreturned
capital contributions made by the Preferred Investor, (b) all accrued but unpaid
Class A Return, (c) all accrued but unpaid Enhanced Class A Return and (d) all
costs and other expenses incurred by the Preferred Investor in connection with
the enforcement of its rights under the Sub-OP Operating Agreement.
Additionally, at the Redemption Date, the Preferred Investor is entitled to an
amount equal to (a) the product of (i) the aggregate amount of capital
contributions made and (ii) 0.4, less (b) the aggregate amount of Class A Return
payments made to the Preferred Investor (the "Minimum Multiple Amount"). As of
September 30, 2022 and December 31, 2021, the Minimum Multiple Amount was
approximately $0.1 million and $0.8 million, respectively, which is included as
indebtedness on the consolidated balance sheets.

The Operating Partnership serves as the managing member of the Sub-OP. However,
the Preferred Investor has approval rights over certain major decisions (as
defined in the Sub-OP Operating Agreement), including, but not limited to, (i)
the incurrence of new indebtedness or modification of existing indebtedness by
the Sub-OP or its direct or indirect subsidiaries, (ii) capital expenditures
over $250,000, (iii) any proposed change to a property directly or indirectly
owned by the Sub-OP, (iv) direct or indirect acquisitions of new properties, (v)
the sale or other disposition of any property directly or indirectly owned by
the Sub-OP, (v) the issuance of additional membership interests in the Sub-OP,
(vi) the entry into any new material lease or any amendment to an existing
material lease and (vii) decisions regarding the dissolution, winding up or
liquidation of the Sub-OP or the filing of any bankruptcy petition by the
Sub-OP.

Under certain circumstances, including in the event that the Preferred
Investor's interests are not redeemed on or prior to the Redemption Date (as it
may be extended), the Preferred Investor may remove the Operating Partnership as
the manager of the Sub-OP and as the manager for each of the property-owning
entities held under the Sub-OP.

The obligations of the Operating Partnership under the Sub-OP Operating
Agreement are guaranteed by the Company, Mr. Jacoby, the Company's chairman and
chief executive officer, and Mr. Yockey, a director of the Company. The Company
has agreed to indemnify Mr. Yockey for any losses he incurs as a result of this
guarantee.

The Preferred Investor’s interests in the Sub-OP under the Sub-OP Operating
Agreement are mandatorily redeemable, and, as a result, are characterized as
indebtedness in the accompanying consolidated financial statements.


On June 16, 2020, the Preferred Investor made two additional capital
contributions available to the Sub-OP in the aggregate amount of approximately
$2.9 million, which is classified as debt. The two capital contributions
consisted of: (i) a $2.4 million capital contribution to the Sub-OP that the
Sub-OP contributed to the Borrowers for purposes of making debt service payments
under the Basis Loan Agreement and (ii) a $0.5 million capital contribution to
the Sub-OP that the Sub-OP contributed to certain of its other property owning
subsidiaries for purposes of making debt service payments on mortgage debt
secured by the properties owned by such subsidiaries and making payments of the
Class A Return due to the Preferred Investor pursuant to the Sub-OP Operating
Agreement. The Preferred Investor is entitled to a cumulative annual return of
13.0% on the additional capital contributions. The Company repaid approximately
$0.8 million of these funds with the proceeds from the Vista Shops mortgage
refinance. Additionally, approximately $0.3 million of availability under the
capital contributions was returned to the Preferred Investor and is no longer
available to the Company. On October 1, 2021, approximately $1.0 million of
availability under the capital contributions was returned to the Preferred
Investor and is no longer available to the Company. As of the date of this
report, there is no remaining availability to the Company from these capital
contributions.

                                       38
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MVB Loan


In December 2019, the Company, the Operating Partnership and BSR entered into a
loan agreement (the "MVB Loan Agreement") with MVB Bank, Inc. ("MVB") with
respect to a $6.5 million loan consisting of a $4.5 million term loan (the "MVB
Term Loan") and a $2.0 million revolving credit facility (the "MVB Revolver").
The MVB Term Loan had an original maturity date of December 27, 2022, which has
been extended to June 27, 2023 under the terms described below, and the MVB
Revolver had an original maturity date of December 27, 2020, which has been
extended to June 27, 2023 under the terms described below. The MVB Term Loan has
a fixed interest rate of 6.75% per annum and the MVB Revolver carries an
interest rate of the greater of (i) prime rate plus 1.5% and (ii) 6.75%.

The Company has no additional availability under the MVB Term Loan and the MVB
Revolver as of September 30, 2022.


The MVB Loan Agreement is secured by certain personal property of the Company,
the Operating Partnership and BSR. In addition, Mr. Jacoby has pledged a portion
of his shares of the Company's common stock and a portion of his OP units as
collateral under the MVB Loan Agreement. The obligations of the Company and the
Operating Partnership under the MVB Loan Agreement are guaranteed by Mr. Jacoby,
in his individual capacity.

The MVB Loan Agreement contains certain customary representations and warranties
and affirmative and negative covenants. The MVB Loan Agreement also requires the
Company to maintain (as such terms are defined in the MVB Loan Agreement) (i) a
debt service coverage ratio of at least 1.30 to 1.00, (ii) an EBITDA to
consolidated funded debt ratio of at least 8.0%, (iii) an aggregate minimum
unencumbered cash, including funds available under other lines of credit, of
greater than $5.0 million (the "Minimum Liquidity Requirement"), and (iv) one or
more deposit accounts with MVB with an aggregate minimum balance of $3.0 million
(the "Deposit Requirement"). The failure to comply with the Deposit Requirement
is not a default under the MVB Loan Agreement but will increase the interest
rate under the MVB Term Loan and MVB Revolver by 1.0% until the Deposit
Requirement has been satisfied. As described below, MVB agreed to require
interest-only payments for three months in 2021 (April, May, and June) and
deferred covenant tests until June 30, 2021 and December 31, 2021.

In December 2020, we entered into an amendment to the MVB Loan Agreement which
extended the maturity date of the MVB Revolver to December 27, 2021 and in March
2021, we entered into another amendment to the MVB Loan Agreement which further
extended the maturity date of the MVB Revolver to December 27, 2022. The
amendments also eliminated the revolving nature of the facility, require monthly
principal payments as calculated over a 10-year amortization schedule, and
require the repayment of $250,000 on each of the following dates (a) the earlier
of March 31, 2021 or the closing of our then-pending Mergers of the Highlandtown
and Spotswood properties, (b) the earlier of September 30, 2021 or the closing
of the then-pending Merger of the Greenwood property, (c) March 31, 2022, and
(d) September 30, 2022. The $250,000 payments owed by March 31, 2021, September
30, 2021 and March 31, 2022 have been paid. Additionally, the amendments (i)
deferred testing for covenants related to the Deposit Requirement, Minimum
Liquidity Requirement and the debt service coverage ratio until June 30, 2021,
(ii) deferred testing for the covenant related to the Company's EBITDA to
consolidated funded debt ratio until December 31, 2021, (iii) modified the debt
service coverage ratio to 1.00 to 1 and (iv) modified the Minimum Liquidity
Requirement to $3.0 million.

On March 22, 2022, we entered into agreements (the "MVB Amendments") with
respect to the MVB Term Loan and the MVB Revolver, which further extended the
maturity date of each to June 27, 2023. The MVB Amendments require the repayment
of $250,000 on each of the following dates (i) on or before March 31, 2022; (ii)
on or before September 30, 2022 and (iii) on or before March 31, 2023. The
$250,000 payment owed by March 31, 2022 has been paid. The $250,000 payment owed
on or before September 30, 2022 was extended to December 31, 2022. The MVB
Amendments also provide for a $2.0 million term loan (the "Second MVB Term
Loan"). The Second MVB Term Loan has a fixed interest rate of 6.75% per annum
and matures on June 27, 2023. We are required to pay an exit fee to MVB in an
amount equal to two percent multiplied by the aggregate principal balance of the
MVB Term Loan, the MVB Revolver and the Second MVB Term Loan at the time of the
maturity date or just prior to such repayments. Additionally, the MVB Amendments
modified the EBITDA to consolidated funded debt ratio from a minimum of 8.0% to
7.0%.

The Company was in compliance with all debt service calculation as of September
30, 2022
.


The MVB Loan Agreement provides for standard events of default, including
nonpayment of principal and other amounts when due, non-performance of
covenants, breach of representations and warranties, certain bankruptcy or
insolvency events and changes in control. If an event of default occurs and is
continuing under the MVB Loan Agreement, MVB may, among other things, require
the immediate payment of all amounts owed thereunder.

Lamont Street Preferred Interest


In connection with the closing of the Highlandtown and Spotswood Mergers on May
21, 2021 and June 4, 2021, respectively, Lamont Street Partners LLC ("Lamont
Street") contributed an aggregate of $3.9 million in exchange for a 1.0%
preferred membership interest in BSV Highlandtown Investors LLC ("BSV
Highlandtown") and BSV Spotswood Investors LLC ("BSV Spotswood") designated as
Class A units (the "Lamont Street Preferred Interest").

Lamont Street is entitled to a cumulative annual return of 13.5% (the "Lamont
Street Class A Return"), of which 10.0% is paid current and 3.5% is accrued.
Lamont Street's interests are to be redeemed on or before September 30, 2023
(the "Lamont Street

                                       39
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Redemption Date"). The Lamont Street Redemption Date may be extended by us to
September 30, 2024 and September 30, 2025, in each case subject to certain
conditions, including the payment of a fee equal to 0.25% of Lamont Street's net
invested capital for the first extension option and a fee of 0.50% of Lamont
Street's net invested capital for the second extension option. If the redemption
price is paid on or before the Lamont Street Redemption Date, then the
redemption price will be equal to (a) all unreturned capital contributions made
by Lamont Street, (b) all accrued but unpaid Lamont Street Class A Return and
(c) all costs and other expenses incurred by Lamont Street in connection with
the enforcement of its rights under the agreements. Additionally, at the Lamont
Street Redemption Date, Lamont Street is entitled to (i) a redemption fee of
0.50% of the capital contributions returned and (ii) an amount equal to (a) the
product of (i) the aggregate amount of capital contributions made and (ii) 0.26
less (b) the aggregate amount of Lamont Street Class A Return payments made to
Lamont Street (the "Lamont Street Minimum Multiple Amount"). The Lamont Street
Minimum Multiple Amount of approximately $1.0 million was recorded as interest
expense in the consolidated statement of operations during the second quarter of
2021. As of September 30, 2022, the remaining Lamont Street Minimum Multiple
Amount was approximately $0.3 million.

Our Operating Partnership serves as the managing member of BSV Highlandtown and
BSV Spotswood. However, Lamont Street has approval rights over certain major
decisions, including, but not limited to (i) the incurrence of new indebtedness
or modification of existing indebtedness by BSV Highlandtown or BSV Spotswood,
or their direct or indirect subsidiaries, (ii) capital expenditures over
$100,000, (iii) any proposed change to a property directly or indirectly owned
by BSV Highlandtown or BSV Spotswood, (iv) direct or indirect acquisitions of
new properties by BSV Highlandtown or BSV Spotswood, (v) the sale or other
disposition of any property directly or indirectly owned by BSV Highlandtown or
BSV Spotswood, (vi) the issuance of additional membership interests in BSV
Highlandtown or BSV Spotswood, (vii) any amendment to an existing material lease
related to the properties and (viii) decisions regarding the dissolution,
winding up or liquidation of BSV Highlandtown or BSV Spotswood or the filing of
any bankruptcy petition by BSV Highlandtown or BSV Spotswood or their
subsidiaries.

Under certain circumstances, including an event whereby Lamont Street's
interests are not redeemed on or prior to the Lamont Street Redemption Date (as
it may be extended), Lamont Street may remove our Operating Partnership as the
manager of BSV Highlandtown and BSV Spotswood.

Other Mortgage Indebtedness

As of September 30, 2022 and December 31, 2021, we had approximately $93.7
million
and $94.9 million, respectively, of outstanding mortgage indebtedness
secured by individual properties. The Hollinswood mortgage, Vista Shops
mortgage, Brookhill mortgage, Highlandtown mortgage, Cromwell mortgage,
Spotswood mortgage and Greenwood Village mortgage require the Company to
maintain a debt service coverage ratio (as such terms are defined in the
respective loan agreements) as follows in the table below.

                                          Minimum Debt Service Coverage
Hollinswood Shopping Center                                1.40 to 1.00
Vista Shops at Golden Mile                                 1.50 to 1.00
Brookhill Azalea Shopping Center                           1.30 to 1.00
Highlandtown Village Shopping Center                       1.25 to 1.00
Cromwell Field Shopping Center                             1.00 to 1.00
Spotswood Valley Square Shopping Center                    1.15 to 1.00
The Shops at Greenwood Village                             1.40 to 1.00


As of September 30, 2022, we were in compliance with all covenants under our
debt agreements.

On November 9, 2022, we entered into a modification of the Cromwell Field
Shopping Center
mortgage and mezzanine loans, which extended the maturity dates
of the loans to December 31, 2022.

Interest Rate Derivatives


We may use interest rate derivatives from time to time to manage our exposure to
interest rate risks. On December 27, 2019, we entered into an interest rate cap
agreement on the full $66.9 million Basis Term Loan to cap the variable LIBOR
interest rate at 3.5%. On June 29, 2022, the Basis Loan Agreement was amended
and restated, effective December 27, 2019, to replace LIBOR with SOFR. On August
1, 2022, the interest rate cap for the Basis Term Loan was modified to cap the
SOFR rate at 3.5%. We also entered into two interest rate swap agreements on the
Hollinswood loan to fix the interest rate at 4.06%. The swap agreements are
effective as of December 27, 2019 on the outstanding balance of $10.2 million
and on July 1, 2021 for the additional availability of $3.0 million under the
Hollinswood loan. On October 6, 2021, the Company entered into an interest rate
swap agreement on the Greenwood Village loan to fix the interest rate at 4.082%.
Since our derivative instruments are not designated as hedges nor do they meet
the criteria for hedge accounting, the fair value is recognized in earnings. For
the three and nine months ended September 30, 2022, we recognized $1.2 million
and $3.8 million gain, respectively, as a component of "Derivative fair value
adjustment" on the consolidated statements of operations.

Cash Flows

The table below sets forth the sources and uses of cash reflected in our
consolidated statements of cash flows for the nine months ended September 30,
2022
and 2021.

                                       40
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                                               For the Nine Months Ended September 30,
(in thousands)                                        2022                     2021           Change
Cash and cash equivalents and restricted
cash at beginning of period                    $            11,024         $      9,983     $    1,041
Net cash provided by (used in) operating
activities                                                     393               (3,994 )        4,387
Net cash (used in) provided by investing
activities                                                  (4,548 )                403         (4,951 )
Net cash provided by financing activities                     (113 )              4,622         (4,735 )
Cash and cash equivalents and restricted
cash at end of period                          $             6,756         

$ 11,014 $ (4,258 )




Operating Activities- Cash provided by operating activities increased by
approximately $4.4 million for the nine months ended September 30, 2022 compared
to the nine months ended September 30, 2021. Operating cash flows were primarily
impacted by (i) a net increase in changes in operating assets and liabilities of
approximately $3.7 million, which was primarily related to the change in
accounts payable and accrued liabilities and (ii) an increase in net cash
provided by operating activities, before net changes in operating assets and
liabilities, of approximately $0.7 million mainly due to an increase in rental
income as a result of the acquisition of three properties in the second quarter
of 2021 and one property in the fourth quarter of 2021.

Investing Activities- Cash used in investing activities during the nine months
ended September 30, 2022 increased by approximately $5.0 million compared to the
nine months ended September 30, 2021. During the nine months ended September 30,
2021, the Company closed on three Mergers which resulted in a net cash inflow of
approximately $2.5 million, which was not repeated during the nine months ended
September 30, 2022. In addition, the Company had an approximately $1.7 million
increase in capital expenditures for real estate and an approximately $0.8
million increase in capitalized pre-acquisition costs during the nine months
ended September 30, 2022 as compared to the corresponding period in 2021.

Financing Activities- Cash used in financing activities was approximately $0.1
million for the nine months ended September 30, 2022 compared to approximately
$4.6 million of cash provided for the nine months ended September 30, 2021. The
decrease of approximately $4.7 million, resulted primarily from an increase in
net borrowings during the first nine months in 2021 under debt agreements, which
includes (i) a $3.9 million increase related to the Lamont Street Preferred
Interest (ii) a net increase in the Vista Shops mortgage loan of approximately
$2.8 million from the refinance of the loan; (iii) the receipt of a second
unsecured loan under the PPP Program of approximately $0.8 million; and (iv) a
$1.4 million decrease related to the payoff of the Cromwell land loan. These net
increases were offset by a net decrease in scheduled principal payments on loans
of approximately $0.3 million as compared to the prior year period.
Additionally, debt origination and discount fees decreased by approximately $0.7
million during the nine months ended September 30, 2022 as compared to the prior
year period.

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