UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Item 2.01 – Completion of Acquisition or Disposition of Assets
On January 8, 2024, two wholly owned subsidiaries of Power REIT sold two cannabis related greenhouse cultivation properties located in Ordway, Colorado to an affiliate of a tenant of one of the properties. The properties are described in prior filings as Sherman 6 (affiliated with the tenant/purchaser) and Tamarack 14 which was vacant.
The sale price was $1,325,000. As part of the transaction, a subsidiary provided seller financing in the amount of $1,250,000 with an initial 10% interest rate that increases over time until maturity. The seller financing has a three-year maturity with a fixed amortization schedule of $40,000 for three months and $15,000 per month thereafter until maturity. The note is secured by a first mortgage on the property and certain corporate and personal guarantees.
The sale of these properties is part of a strategic review by Power REIT as it continues to evaluate alternatives to enhance liquidity and improve opportunities. In 2019, Power REIT shifted its focus to Controlled Environment Agriculture in the form of greenhouses as a technology based real estate opportunity. Power REIT has significant exposure to cannabis cultivation related tenants. The market for cannabis at the wholesale level in many markets across the United States has gone through a dramatic change which has put significant financial pressure on our tenants. We continue to work through tenant issues and are exploring options intended to create shareholder value including, but not limited to, additional asset sales.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| POWER REIT | ||
| Date: January 9, 2024 | By | /s/ David H. Lesser |
| David H. Lesser | ||
| Chairman of the Board and Chief Executive Officer | ||