Thank you, and welcome to Strawberry Fields REIT's Q1 2026 earnings call. I am the Chief Investment Officer, and joining me today on the call are Moishe Gubin, our Chairman and CEO, and Greg Flamion, our CFO.

Earlier today, the company issued its Q1 2026 earnings results, which are available on the company's Investor Relations website. Participants should be aware that this call is being recorded and listeners are advised that any forward-looking statements made on today's call are based on management's current expectations, assumptions, and beliefs about Strawberry Fields REIT's business and the environment in which it operates.

These statements may include projections regarding future financial performance, dividends, acquisitions, investments, returns, financings, and may or may not reference other matters affecting the company's business or the businesses of its tenants, including factors that are beyond our control. Additionally, references will be made during the call to non-GAAP financial results.

Investors are encouraged to review these non-GAAP financial measures as well as explanation and the reconciliation of these measures to the comparable GAAP results included on the Non-GAAP Measure Reconciliation page in our investor presentation. Now on to discussing Strawberry Fields REIT and our Q1 2026 performance.

I wanted to start by sharing some key highlights for the quarter. During the quarter, the company collected 100% of its contractual rents.

The company signed a term sheet for a corporate credit facility with availability of up to $300 million. The facility will be comprised of a $100 million term loan and a $200 million revolving line of credit, both having initial three-year terms and two one-year options.

Proceeds from the facility will be used to refinance our existing secured bank debt, and the remainder will be available to support acquisition growth. The rate on the facility will be SOFR plus 275.

The company expects to close on the facility during Q2 2026. Deal-wise, while we did not close on any deals during the quarter, we were quite busy underwriting deals.

As we have detailed in past presentations and investor calls, we have our disciplined acquisition model of 10-cap acquisitions that we have been true to over time and expect to stay on this course for the foreseeable future. I am pleased to report that subsequent to quarter end, the company entered into a contract for the acquisition of a hospital campus comprising of a licensed 60-bed hospital, licensed 99-bed nursing facility, and ancillary medical office buildings near Kansas City, Missouri.

The purchase price will be $8.6 million, and the company expects to fund the acquisition from the balance sheet. The hospital campus will be added to an existing master lease of a tenant in Missouri with initial base rents of $860,000 a year and subject to 3% annual rent increases.

Yesterday, the Board of Directors approved a Q2 20- Q2 2026 dividend, which will be 17 cents a share, and will be paid on June 30th to shareholders of record on June 16th. Lastly, I'd like to point out that Strawberry Fields REIT remains the closest pure-play skilled nursing REIT in the market, with 91.5% of our facilities being skilled nursing facilities.

Additionally, we have not changed our investment approach of all our investments being triple net leases subject to annual rent increases. I would now like to have Greg Flamion, our Chief Financial Officer, discuss the quarter-end financials.

Thank you, Jeff, and welcome, everyone, to the Strawberry Fields first quarter earnings call. Let's begin with a look at our balance sheet.

Total assets are $880- $878.6 million, an increase of $43.8 million or 5.2% compared to March 31st, 2025. Our asset growth was driven primarily by recent real estate acquisitions, including $112 million of acquisitions completed in 2025.

On the liabilities and equity side, increases were driven by financing activity associated with our acquisitions along with the impact of foreign currency translation adjustments. Together, these factors contributed to an overall growth in our debt balances.

Equity declined, reflecting lower other comprehensive income, driven again by foreign currency translation adjustments. Continuing now to the consolidated statement of income.

2026 revenue was $40 million, up $2.7 million compared to March 31st, 2025. This represents a 7.1% increase, which was driven by the timing and integration of properties acquired in 2025.

While we expanded our revenues, the income growth was offset by higher depreciation and interest expense, which was driven by the new property acquisitions. General and administrative expenses were also higher due to professional fees, corporate salaries, and other operating expenses.

These increases were offset by lower amortization expense. The result is the year-to-date net income of $9.4 million, or 17 cents per share, compared to $6.9 million, or 13 cents a share, in Q1 2025.

Finally, I would like to end my presentation with some financial highlights. Our 2026 projected AFFO is $75.4 million, representing an 11.4% compound annual growth rate.

The 2026 projected AFFO per share growth is 10.7%. The 2026 projected adjusted EBITDA is $128.1 million, representing a 13.5% compound annual growth rate.

Our yield on leases is 14.2%. The company's net debt to net asset ratio currently sits at 49.0%.

As of March 31st, 2026, our dividend was 16 cents a share, representing a 5.4% yield and an AFFO payout of 47.3%. The company recently increased the dividend for Q2 to 17 cents a share.

This concludes the financial portion of the earnings call presentation. I'll now turn it back over to Jeffrey Bajtner, who will walk us through additional portfolio highlights.

Thank you, Greg. As relates to our portfolio highlights, our portfolio currently has 143 facilities located in 10 states.

This is comprised of 131 skilled nursing facilities, 10 assisted living facilities, and two long-term acute care hospitals. Also, these 143 facilities equate to 15,602 licensed beds.

The total value of our portfolio at acquisition is $1.1 billion. Our portfolio currently has 17 consultants advising the operators.

The weighted average lease term is 7.1 years. I'm proud to report that our tenants continue to do well, and their rent coverage is 2.1.

The net debt to EBITDA of the portfolio is 5.6. We continue to collect 100% of our rents.

As I mentioned earlier in my remarks, our pipeline remains strong, and it's in excess of $325 million. With that, I'd like to pass it on to Moishe Gubin, our Chairman and CEO, to continue the presentation.

Thank you, Jeff, and thank you, Greg. As they both have alluded to, really, we are on a nice trajectory in our business.

This slide here reflects the last five years and projection of 2026 AFFO growth, which gives you a cumulative growth rate of 11.4%. We're particularly proud of that.

The slide after that is base rent, and just similar similar time frame, similar trajectory, 13.4% growth rate. Our stock price over over the last year, and we've seen highs and we're currently trading we're trading too low, but we're we're we're on up from from how we ended the quarter, and that was right when I think all that Iran stuff started.

Comparatively, between us and our peers, Strawberry's is is right in the middle. We're 26% on our stock.

If you would've bought the stock a year ago till till March 31st, 26% 26.4% return, and our trading multiples are still the laggard in the marketplace. I'm still dumbfounded on why that is.

We're at 9.5 times when the average is right around 14 or so, and CareTrust is leading the pack at 21.4%. Our AFFO payout ratio continues to be the lowest from everybody else, and that's even I'm sure with the increase of our dividend that we announced today.

We're at 47% payout ratio, and that's the lowest of our peers. We find that our best use of our money is is staying within the REIT standards, the REIT rules, and and using the rest of it rest of the cash that we're generating to grow our portfolio.

Our dividend yield, and this is at March 31st at 16 cents, is 4.9%. Obviously, with an increase, that should be somewhere in the 5s, maybe closer to 6.

Like Jeff said earlier, we remain a pure-play SNF real estate, SNF REIT, and we're going to stay and stick with that because that's really where our our comfort zone is, doing exactly what we're doing, staying very disciplined. We've been preaching this for years and years and years, and we're going to continue to do exactly what we do.

In years where there are less deals, we'll just continue to stockpile cash, pay down debt, and and save our money for when we get the deals. I think this year we'll still meet our target of between $100 and $150 million, maybe exceed it.

It's been a slow start, but we expect the this quarter to really pick up and then actually have a bunch of closings in the third quarter. The next slide just covered coverage shows our rent coverage from our tenants.

That continues to grow. Again, every time we close on deals, we we're starting every deal at a 1.25 coverage ratio, and so therefore, we're we're our own worst enemy.

Where last year we closed $112 million or so or something in 19 properties, you take that, it weights us down, and as every quarter goes by, our tenants' results improve. Our growth rate per share, we're beating everybody in the marketplace, and that's, it's almost inverse to for the payout ratio, and we should continue to to do that.

Collectively between the payout ratio, the dividend yield and the AFFO per share growth, we're we're at the end of the day better return than our peers, averaging out at a 16% return a year. The next slide is probably one of the most important slides, and it basically shows you, really how that how how the math of what we do.

The projected '26 revenue of AFFO is over $75 million. Again, this is before deals.

This is This is not projected anything out. This is just what we have running today.

So $75 million, the payout ratio for that is 47%, retained cash flow close to $40 million. We then take that $40 million and then we're able to buy.

We want to stay right at our 49% leverage, if we want to stay at 49%, that basically gives us the ability to borrow about $50 million on that, we could buy $90 million without changing our leverage at all. Reality is, we have other cash sitting that we should be able to, get more money out the door.

That's and that's and that's what we've done until now, and we expect that to continue. The next slide is is probably one of the biggest focuses we have right now.

We should be announcing in the next little bit we we intend on refinancing a good portion of this money that's that's maturing this year, and we expect to refinance half of it probably in the next couple of weeks, and then we'll do the other half probably sometime in August. Most of this Where where we end up in this situation is that once '26 ends, we should have almost divided up equally over four or five years laddered laddered debt maturing so that every year we could be with a year's runway, be able to be sit there and and refinance our debts, and that should be that should be really good for, having a business that can perpetuate, long term.

It's interesting to note over here, really, I made a mistake a few years ago, and I made all the all the maturity dates right around the same, and it was intentional. The one thing that I missed is that there was a a prepayment penalty all the way to the end, and to avoid paying prepayment penalties, we've gone down this road where where now we have about five months left maturing on most of this debt, and so we're going to refinance most of it most of it soon, and the rest of it in probably a few months.

That's this slide. The next slide The next slide really is is just shows how diversified our portfolio is at this point.

The the the only really large consultants or states is Indiana, which happens to be our best state, which is sitting at 25% of the portfolio and 25% of the base rent. That being said, everything else is pretty even wedges, and high single digits, middle double digits, and and that's for an investor that's wanting to have a diversified risk, our portfolio is not subject to We don't own a bunch of single assets that where something goes wrong in one asset would hurt us.

Most of our stuff's are in master leases, as most of you probably know, and and if we had a problem in one specific state, right, we'd be able to get through everything without there being anything, anything really big as a risk. Next slide just really talks about where we're located.

As you can tell, we've stayed mainly in the Midwest, and we God willing will be announcing a deal for a new state in the Midwest in the next and hopefully the next couple of weeks. It's good, business is good, we're collecting all our rents, like I think Jeff said earlier, and and business business business is good.

I don't I we have no issues. On our last slide for today, and after this we'll hand it off to the moderator to take questions from the audience, this really is one of my favorites because I just it's in simple, simple, simple English.

You look at three months ended March 31st of '26 versus '25, and you see our net income, went up $2.5 $2.5 million, and FFO, $2.7, and AFFO, $2 $2 million or so. That's what it's all about, really showing that at the end of the day they have a $75 million of annualized AFFO expected.

The the graph to the right the the the the financial to the right is EBITDA. Again, same story, just adding back depreciation, amortization, and interest to come up with EBITDA number.

We went up, $2.3 million or so, and adjusted EBITDA a little bit less than $2 2 million bucks. I'm super, super proud of all this.

With that, I will pass this back to the moderator to take any questions.

Hey, good morning, everyone. Or

good afternoon, depending on where you are.

In mentioning the pipeline growing, I do see last quarter it was 250, now it's 325. I'm curious what the additions were, not just the $75 million, but in form.

Like you did something in the second quarter with a hospital campus and some medical office. I'm curious if that will be more of the mix of stuff that you do going forward rather than just pure-play skilled nursing, and I'm just curious, your mindset along that line.

Rich, thank you for your question. Happy to hear your voice.

Hope to see you at NAREIT. I would say that no, we're going to stick with nursing homes.

Most of our deals that we're close to getting offers accepted on are skilled nursing facilities, and a few of them are new states for us. The increase of the pipeline is deals that are just slow to get done.

A lot of times, people would get disinterested, but we sit there and we just keep working it and we follow up with people, to the testament of Jeff here on the call. It's just persistency and staying with them.

There's some deals, and just lately it seems like deals are taking slower. We had a deal that we've signed up and actually CareTrust came and stole it from us, and that would have been a nice, nice deal for us.

They offered like $25 million more than us, which is crazy because the other people had already accepted our offer. That being said, no, we don't want to change what we're doing.

This hospital MOB deal comes with a nursing home, and we found value that the purchase price we're paying, the hospital and the MOB basically are a throw-in, and the nursing home itself had more value than what we're paying. We feel like we're getting a great deal, and our operator that's taking it from us is somebody that has experience, is a doctor practice, physician practice, and we feel it's going to be a nice addition to our portfolio.

I'd

like

to add to Moishe's point there that this number's almost like a living and breathing number. We evaluate the pipeline every week.

The only items that are really being included with this are just deals that we think there is an opportunity to complete. As Moishe said, some deals have been sitting there over time, but also the SNF deal market has been picking up steam in the past, I'd say in the past month.

We're looking at deals, as Moishe said, in new states, in existing states, and we're excited to see what we could do the rest of this year.

Okay. Then my second question, you mentioned CareTrust.

How typical are you running into REIT peers in terms of competitive processes to get deals done? Is that sort of an anomaly, or are you seeing, some name brand folks that we all know and love out there with you that you're competing with?

Historically, we've never ran up against them. In the last year or two, we look at every deal, but as we're trying to do bigger deals, just so that, we figured, the marketplace maybe would be more excited about our stock and who we are if we can announce bigger deals and do bigger deals, all with the same metrics, exactly how we buy, the same 10-cap, 10% cash-on-cash return day one, our regular routine and rules of how we buy.

When it gets to these bigger deals, which was our original thought, which was years ago is, that's where the competitive bids are coming in. We've lost one deal to Welltower and we lost one deal to CareTrust, and that was after we basically had a handshake with a seller.

You spend so much time on these things, and then someone else comes in and says, "Okay, I'll just throw more money in it." We're just going to keep doing what we're doing.

We're not changing our model to pay more. I'm not going to get disinterested to stop looking at the bigger deals.

I think there's a benefit. I love CareTrust and I love Dave Sedgwick, but I can tell and I've said that probably a thousand times.

I just think that we offer something on a personal level with a lot of the sellers, and so we should be able to pull down these deals. I would say that it hopefully will be an anomaly that we've lost a few deals to the bigger boys.

Okay. Thanks for the honesty, as always, Moishe.

Always, Rich. That's how I roll.

Thank you.

Thank you. I wanted to ask you on the acquisition pipeline.

I think on the last earnings call, you had mentioned the target of $100 to $150 million of acquisitions this year. Given that you had a slow start in 1Q, are you still hoping to hit that target?

Yeah, 100%. I'm hopeful that the third quarter will close somewhere in the 90, $90 million to close to $100 million range.

I'm hoping that in the fourth quarter, we'll have another 15 to 30 or 40, unless something else pops up. Right now, we're looking at everything is going to get loaded into third quarter and fourth quarter, and we should hit easily the 100, and hopefully we should do and break 150.

For that third quarter, $90 to $100 million, are you guys looking at a portfolio?

We have one deal, we have a deal that we didn't announce yet that should be in the 80s for a group of homes in a new state. Then we have this deal in Missouri that we've announced.

We have another deal that we also didn't announce that's going to also add to a master lease in a state we're already in, that'll be about a $15 million deal. Between just those three deals alone, you're looking at $107, $108 million.

We have some other things. We got a portfolio elsewhere with a newish, but someone who's a tenant of ours or will be a tenant of ours real soon, another package that we're looking at with them.

If that deal hits, that'll get us about 145 or 150 or so. The good news is, we will have our line of credit up and running by the end of this month.

We're going to have a new bond issued next week or in the next two weeks in Israel to basically kick the can down the road in some of our debt. We'll have availability between the line of credit and without doing an ATM, without doing a fundraise, without taking on any other additional debt, we have the ability based on our just available borrowings besides the cash in our books, we'll have about $150 million or so of availability or right around.

We have the cash to be able to do all this stuff, and keep ourselves in the same leverage band that we're in right now, hovering around 49%, which is right basically in the middle of where we want to be. I think we're in a good spot.

I got to kind of plan it out better for future years that we have stuff that we push into first quarter, when it comes to the first quarter call, I can say, "Hey, we closed at least this, that, or the other thing." Sounds a little better than, "Well, we had a great quarter.

We made a lot of money. We're doing great.

We're collecting 100% of our," which also sounds good, by the way. I think it would sound more better if I would have had a deal closing in the first quarter that I'd be able to walk around like a peacock about, but it is what it is.

All right, thanks for those details. As a follow-up, I wanted to ask you, in the earnings release, you talked about investing some time in different processes within the company this quarter.

Can you maybe provide some color on what those processes were?

I think we're referring to the refinancing and cleaning up our debt. A big portion of our debt is sitting in Israeli bonds, which I'm proud of.

I like the relationship we have with the Israeli market. Our time and effort has been on creating a couple new series that we'll have in Israel to clean up the three series that mature this year.

The other thing has been creating the line of credit with the bank, which is something that our peers all have. We thought maybe that was one of the issues that maybe investors maybe think about is that when they look at our company, they go, "Well, we don't have the dry powder to be able to close on certain deals."

We wanted to be able to have these lines of credit so we could be able to tell potential investors, "No, we have plenty of dry powder." Everyone who knows me and knows our business knows that it hasn't been a deal that we made that we couldn't close.

Maybe an investor that doesn't know that, hadn't had a chance to speak to me or one of my guys, that they might not have known that, and therefore, we want to be able to have that so that when we put that into the Q and future press releases, we're able to say, "Yeah, we just have this line of credit that we could draw on, and then we went to the public, sold stock to pay down debt, and keep ourselves between 45% and 55% on the leverage side." That's basically what we've been working on.

I'm always looking at deals. It was just cleaning up our debt stack and the fundamentals of our balance sheet so that going forward, we'll have a normal laddered debt maturity, and we'll have a line of credit that's just there for us to be able to use when we need to buy something.

All right. Thanks for the details.

That's all I had.

Thanks, Gaurav. Hopefully, we'll see you at NAREIT as well.

Sounds good.

Hi, everyone. Good afternoon, good morning.

Maybe going back to the term loan, post-closing, what's the appetite on the term loan side, swapping out any of that for a fixed rate versus leaving draws on that floating?

That's an interesting question. I like it.

Done, John. You didn't stomp me, I just haven't thought about it.

I I think when you're when you're in a an interest rate environment that most people expect to be either at this point, the way the economy is running, it seems like it's been re- remained stable. Interest rates are definitely not going up.

Usually when you have that, you usually don't want to lock in fixed. From from from my perspective, I hadn't given thought, maybe it's something I'm going to think about.

I think that at this point in a declining rate environment, I think it's probably not wise for me to do fixed. It's funny to think about, and I appreciate the question.

In years past, in years past, we relied on we relied on HUD being the exit for our debt, and then, that's long-term 40-year money. In the last few years since Corona, the way HUD's been HUD's been as far as lending, and our relationship specifically with HUD has been, I don't know the right word.

I don't want to put an adjective on it that makes anyone nervous, but it's just like it's just been, we're not going anywhere. Stagnant, that relationship.

Sort of I didn't have to think about, where to place the long-term debt and and to lock things in for a fixed rate. That's a great question, because that's something now that has to be in the forefront for us to think about.

I think we're kind of hedged because of the declining rate environment, which is that's my prognosis. I could be completely wrong.

Of course, I could always be completely wrong. That's my thought, and, my background is a little bit banking as well, the banking world, we're thinking that it's the same thing, stable to declining rate environment.

I think I answered your question, John. I don't know.

No,

that's helpful color. Maybe it sounds like still in the market with potentially new Israeli bonds or at least refinancing existing Israeli bonds, what's pricing look like on that today as you kind of work through those, and I guess how would you think about maturity dates or term on that debt, because it sounds like you're going to probably break up the refinancing into a couple of different tranches.

Just kind of curious how that's shaping out as you start the process, or work through the process, I should say, today. No,

yeah. We're towards the end of the process, and and it's a great question.

Very astute, I love it. It's we're It's about 4.5-year money, and the pricing today is about 6 6.85 or so.

You've got to add in a little bit in the fees, but I don't think anyone ever mentions that on any of these calls, I'm not sure if I'm supposed to talk about that or not. Like, but the actual interest rate is going to be at 6.85, 4.5-year money, expiring the end of '30.

Then when we do the second tranche in August, September, that'll be expiring sometime in maybe June 30th of '31. The idea for all of this is the the corrective measure from my mistake that I made a few years ago is all of it's going to have a a a a a prepayment holiday for like the last six months for me to be able to refinance it, instead of going closer to the wire, be able to refinance it earlier in the mix.

Just on that topic, the the line of credit and term loan that we created for for with with the conventional bank, those are going to have two one-year extensions at the end of them so that we so that during those two one-year extensions, during the first one-year extension, that'll be the time that we work on the extension or or the new the new debt to replace that. That also that that ends in five years.

Kind of the way we're positioning it is, we're kicking the can of '26 money and part of '28 money, and we're ending up with half in '30 and half in '31, basically. Then, comes the '20 the stuff that's going to mature in '27, we can start working on now to kind of push to '32.

Then we'll just start on a rolling a rolling, maturity ladder of one year at a time that we could just kick kick the can five years down on each thing. Then and as we grow and what we do, then that tranche will just have the additional of the new stuff together with that and kind of push it down five years.

I hope that makes sense, but that's I think I my my my idea my idea, and I'm not planning on going anywhere, God willing, God keeps me alive and healthy and that the shareholders want me to keep leading them and keep doing this, is that is that is that I want to create all these processes that the business is able to be perpetuated long term, so that the normal the normal maturities every year becomes a process. We have to we have to refinance, this year's batch of debt that's maturing, push it down five years and have that rolling every year as a normal routine.

Same thing with, with with all the other processes that we have in place with with, how we buy and and and and, just even IR, how we deal with the public and all of these things. I want the process to be so clear and clean that we should be able to perpetuate it on a regular routine, not to be robotic, but to be able to be reliable and credible.

Then

maybe switching gears a little bit, in terms of the potential acquisition in a new state, is that with an existing consultant relationship or a new one? I guess what's the appetite for some of the existing consultant relationships to try to grow here in the current market?

The

starting point of that question is that our relationships with our tenants are amazing. We don't have any negative communication or relationships.

They're all they're all fantastic. All of us, I consider everybody part of the family, and it's really really it's really good.

The so like so from our current our current roster of of tenants, to the folks in Oklahoma, we're growing with them. There's deals we've consistently been buying more deals in Oklahoma.

Texas, we're growing with with current operators. Missouri, we're growing with current operators.

Ohio, over the years we we haven't grown, and believe me, I love those those tenants. We we just renewed.

They've they've been tenants really now more than 10 years. It was just relationship hasn't grown, unfortunately, and we're very very close.

Friend I would call we're close friends. It but but the newer things for the new packages are all brand-new operators that are not new to me as human beings.

Some of them are borrowers at my bank, some of them are just people that have been in the industry that we've known for many years. We have two new relationships in two different states that we're starting with now, God willing, that that we're going to start with, a decent-sized, between 5 and 10 homes at each each portfolio.

God willing, it should it should it should it should be great. Again, if if, any deals that come along, I we have a commitment between our our tenant and us that we're looking in so so out of the 10 states we're in, there's there's probably five or six of them that we want to grow in, and we don't want to grow with, the related party stuff.

That's been diminishing, and that's down to 46% of the portfolio. We should be announcing something soon that's going to then further dilute that down.

We we we I guess that's something that we don't really we should we should bring up in our presentations. Our relationships with our tenants are fantastic.

Yes, we would grow with almost all of them if we if we could.

I would like to add to that that 90% of our facilities are in master leases right now, and the best way to grow is just once the table's set with that master lease, it's just very easy to keep on adding facilities. As we've been doing that, as Moishe said, in Oklahoma, Missouri the past year, it's been very good to both us and the tenant.

Yep. I appreciate all the detail.

That's it for me. Thank you very much.

Thank you.

Thank you.

Hey, guys. Just wanted to go back a little bit about what you're seeing here for deals.

Sounds like a lot of work in Q1, but some that just didn't get across the finish line. Outside of competition for some of these deals, is there anything else that's kind of changed or that's made it harder to close on some of these?

No. No, absolutely not.

We don't have any issues with cash. We don't have any issues regulatory-wise.

I know there's some stories out there a little bit, Senator Warren and a couple of others are on this issue about healthcare REITs owning nursing homes, but that really has been a lot of talk. I actually called both senators' offices to say, "Hey, let me talk to you and explain it to you," and they didn't really have time or want to talk to me.

That being said, there's nothing blocking us from doing any deals other than the competitive of the price. If a deal doesn't underwrite, we remain very disciplined, and we're not looking to risk our portfolio on just what do they call that, a wish, whatever it is, a prayer and a wish, whatever it is, wish and a prayer.

We're not looking to do any of that. We're looking to stuff that makes sense, that the math is there, continue with our process, and do things the way we do it.

It's worked, and it should continue to work. It was just a slow first quarter for us, unfortunately, as far as portfolio growth.

Okay. Then I just wanted to ask about just geographical expansion.

I know we talked about the Southeast and some other markets. It does sound like we'll likely see a new state added here soon, but it sounds like that's still in the Midwest.

Just kind of curious your appetite around more geographic expansion.

We got close on a couple deals, Georgia, and if we found deals, which we haven't even seen any deals, Alabama, Mississippi it would be great to get down to or South Carolina. Where the deals and where we're growing are both going to be Midwest deals, and the increases to our portfolio are most likely going to be Texas, Oklahoma, maybe a little bit Tennessee, and always if we can find anything in Indiana.

We've particularly not wanted to grow in Illinois for many years because when we started, we were just top-heavy there, and we want to make sure that we have a diversified portfolio. That's kind of our own internal control as far as growing there.

No, I would love to grow in the next few years certainly Iowa, if we can get a deal in Michigan. We looked at a deal in Michigan at one point, Wisconsin, stick with that and see where it goes.

Okay. Great.

Thank you, guys.

You're welcome. Thank you.

Thank you. Good afternoon.

Hi, Ben. Hello.

Just want to follow up on just kind of comments you were just making. On the competition, you have said a big deal that you announced likely is coming.

On the ones that you lost, what kind of made them go with the competitors? Anything in specific?

Anything that you're able to maybe manage in the future with some of these larger deals you're looking at?

It's actually an interesting thing. That deal, what made that difference and why we lost that deal, was a brokered deal, different than a lot of our deals.

A lot of our deals, we know the sellers, and they specifically want to work with us, and they chase us down, and we work with them, and deals get made. The brokers, rightfully, are looking for top dollar, and they get more of a commission if it's a bigger deal.

That deal that we lost was a deal that we spent time working with the broker, and the brokers were very friendly, these are good people. At the end of the day, until the ink is dry on those deals when it's a broker-based deal, right, someone else could come in with a bigger dollar amount and the broker calls the client and says, "Hey, you could probably still get out of your deal if you want to go take a different deal."

In that case, we didn't know the seller at all, and the seller took, the last minute, this is 11:59 and 58 seconds, and much higher offer, and they took it. The only thing we could do differently there is somehow earlier in the process get to know the sellers, but in our world, the sellers that we buy from are sellers that we've known for 20 years or 10 years, and we're known in the industry.

We go to all the events. We spend a lot of time talking to people, and so I don't know if we could have done anything differently there, other than give a little guilt trip to the broker, saying, "You've got to be a little nicer and not pull a deal away from us in the last minute."

I don't think we could have done anything differently there.

Do you have a sense of what the cap rate went out at on that deal?

That's actually the I guess not the saving grace or whatever it is, that in theory, our portfolio is way undervalued because if everything would trade at the 8.5-cap that someone else is willing to buy these things at, if you reprice my whole portfolio at 8.5-cap, you'd say that I have another couple hundred million dollars of equity. No, I think it traded at an 8.5-cap.

Okay. Last question I have is on the $255 million that's maturing for the remainder of this year, how much of this is going to be refinanced with the Israeli bond tranches that you mentioned versus the $300 million in financing?

If I commit to the one thing, the pricing's just going to go up. I don't really want to answer that.

I would say that from my point of view, my primary desire would be to Israeli bonds to replace the three Israeli bonds. I would do the bond we're doing next week, God willing, and then, assuming the last two bonds we did, we were oversubscribed by 50%, assuming we have the same oversubscription and people want it, we would probably take the most we can take and then pay down early one of the other bond debts.

What that does for us is that it locks in our currency for 4 or 5 years, which is a hedge. Today the dollar versus the shekel, the shekel's strong, we have built into our financial statements a sizable allowance for currency, and I don't want to realize that.

If we kick the can down the road 4 or 5 years on the currency, then I don't have to realize a loss that we've already expensed. It's OCI, no one looks at it, but nevertheless, it's there.

My desire is most likely to go to the Israeli market, assuming that they're going to stay competitive on the pricing, which they should.

Okay. Because the follow-up on that was look like you'd have 25, 50 basis points of spread improvement depending on how you structure this.

Would that be fair to assume? Yes.

Yes, yes,

yes. We're going to go from an average rate between the 9.1, the 6.9, and the 5.7, which are the three tranches that have to get refinanced.

It'll end up all being at six 6 and 3/4, 6.85. If we do the commercial loan, we end up being at 6.4, something like that, 6.4, 6.5, and either way, you're talking about an improvement of at least a half a point on a couple hundred million dollars of debt.

Then leaving you with $150 million of dry but when all's said and done, $150 million of dry powder to work with. Okay.

Yeah, 150, 140, yeah, 100%.

Excellent. Thanks for the color.

Appreciate it.

I think it's a good spot to be in at the end of the day.

Great.

thank you so much. Thank you, everyone, for joining us.

It's always a pleasure hearing everybody's questions. If you have any further questions, please feel free to reach out to Moishe, myself, or Greg.

I'd also like to further add, if anyone is interested in listening to the recording from yesterday's annual shareholder meeting, it's up on our website, strawberryfieldsreit.com. Once again, thank you, and have a wonderful weekend.

Thank you.

Thank you