Creative Media & Community Trust (CMCT) Q3 2024 earnings summary

Executive summary

• The portfolio is shifting from traditional office assets to premier multifamily and creative office properties, with a focus on vibrant, high-growth U.S. communities and ongoing development projects.

• Net loss attributable to common stockholders was $34.8 million ($1.22 per diluted share) for Q3 2024, compared to $22.9 million ($0.94 per share) in Q3 2023, driven by higher preferred stock redemptions and lower NOI.

• Management is accelerating multifamily investments, improving liquidity, and retiring the recourse corporate-level credit facility, with refinancing and asset sales planned.

• Multifamily development and hotel renovation projects are progressing, with new units leasing and hotel room renovations nearing completion.

• CIM Group, the manager, owns ~15.1% and provides significant market knowledge and operational expertise.

Financial highlights

• Q3 2024 segment NOI was $7.6 million, down from $11.2 million in Q3 2023, mainly due to declines in office and hotel segments.

• Q3 2024 FFO attributable to common stockholders was $(28.4) million ($(1.00) per share), down from $(7.5) million ($(0.31) per share) year-over-year; Core FFO was $(0.40) per share.

• Q3 2024 total revenues were $28.6 million, up slightly year-over-year.

• Multifamily segment NOI improved to $508,000 from $(391,000), driven by higher occupancy and rents.

• Hotel segment NOI fell to $973,000 from $1.9 million, impacted by renovation-related occupancy declines.

Outlook and guidance

• Management expects to complete the 36-unit Echo Park multifamily development in Q3 2025 and finalize all 503 hotel rooms by year-end 2024.

• Proceeds from asset refinancings and potential sales will be invested in multifamily properties and used to retire corporate debt.

• Plans to complete refinancing of the Sacramento hotel and three Los Angeles properties by Q1 2025 to address credit facility covenants and liquidity.

• Minimal new multifamily supply is expected in Oakland, supporting future rent growth.

• Ongoing evaluation of asset dispositions and capital raising opportunities to position for future growth.