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SUBSEQUENT EVENTS
9 Months Ended
Sep. 30, 2023
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS

11 – SUBSEQUENT EVENTS

 

On November 1, 2023, a wholly owned subsidiary of Power REIT (“PW SD”) sold its interest in a cannabis related greenhouse cultivation facility located in Maine to an affiliate of its tenant. As previously announced, PW SD had entered into a Purchase and Sale Agreement related to this property that has been renegotiated based on current circumstances as part of proceeding towards closing. The total consideration was $4,787,000, of which $3,400,000 was paid in cash, $537,000 was paid in the form of the release of the security deposit held by PW SD and seller financing in the form of an $850,000 note with an 8.5% interest rate that will accrue until maturity on October 30, 2025. The note is secured by a second mortgage on the property and certain corporate and personal guarantees. Of the cash proceeds received from the Sweet Dirt sale, $1,642,187.50 was used to pay down the Debt Facility.

 

On October 2, 2023, PW CA CanRE Canndescent LLC (“PW Canndescent”) entered into a new five-year lease with San Fernando Valley Patients Cooperative, LLC for the property in Desert Hot Springs, CA. The lease is personally guaranteed by the principals of the tenant. Upon execution of the lease, the tenant paid a non-refundable $25,000 to PW Canndescent for a 30-day due diligence period which allowed for the termination of the lease. The due diligence contingencies were waived and an additional $85,057 was received on November 2, 2023. Of the amount received, $67,492 represents a security deposit and the balance represents prepaid rent and other charges. The lease is a triple-net lease whereby the tenant is responsible for the common area expenses, insurance, property taxes and maintenance costs. The monthly rent is $18,476 beginning December 1, 2023 which increases to $45,721 on April 1, 2024 with annual 3% escalations.