LOAN

Business Context and Reporting Period

Company: Manhattan Bridge Capital, Inc. (LOAN)
Filing Type: Form 10-Q (Quarterly Report)
Period Ended: March 31, 2026
Business Overview: A New York-based real estate finance company specializing in short-term, secured, non-banking ("hard money") loans to real estate investors for acquisition, renovation, and development in the New York metropolitan area and Florida. The company operates as a single reportable segment and is taxed as a Real Estate Investment Trust (REIT).

Key Financial Metrics

Material Changes vs. Prior Period

• Revenue Decline: Total revenue decreased by 9.1% ($206,000) compared to Q1 2025. This was driven by a decrease in interest income ($134,584 lower) due to a period-over-period decline in loans receivable and lower origination fees ($71,485 lower) reflecting reduced loan origination activity.
• Expense Reduction: Interest and amortization of deferred financing costs decreased by 19.5% ($88,000) due to lower average borrowings and reduced SOFR rates. General and administrative expenses decreased by 5.1% ($23,000) due to lower advertising/appraisal costs and the absence of a prior-year listing fee.
• Net Income: Net income decreased by 7.2% ($99,000) to $1.27 million, primarily attributable to lower revenue, partially offset by reduced interest expenses.
• Portfolio Growth: Despite lower revenue, the loan portfolio grew from $60.2 million at year-end 2025 to $61.9 million at March 31, 2026. Net cash used in investing activities was $1.86 million, reflecting $14.25 million in new loan issuances against $12.39 million in collections.

Guidance, Outlook, and Risks

• Outlook: Management believes current market dynamics, specifically the demand/supply imbalance for small real estate loans, present opportunities to selectively originate high-quality loans. They expect working capital requirements to increase over the next 12 months as they pursue growth.
• Liquidity: The company maintains two primary credit facilities:
  • Webster Credit Line: $32.5 million aggregate capacity. Amended on March 24, 2026, extending maturity to February 28, 2029, and modifying portfolio composition requirements. Outstanding balance: $13.39 million at ~6.9% interest.
  • Valley Credit Line: $10.0 million capacity for subsidiary MBC Funding II. Matures December 12, 2027. Outstanding balance: $6.04 million at ~6.6% interest.
• Dividends: A cash dividend of $0.11 per share was paid on April 15, 2026. A subsequent dividend of $0.11 per share was declared on April 14, 2026, payable July 15, 2026.
• Risks: Key risks include borrower concentration (one individual holds a 50%+ interest in three entities comprising 10% of the portfolio), interest rate sensitivity, and reliance on the CEO for business development. The company has no loan impairments as of March 31, 2026.

Investor Verification Checklist

• Concentration Risk: Verify the status of the three entities representing 10% of the loan portfolio, as they are linked to a single individual.
• Credit Facility Covenants: Confirm continued compliance with the amended Webster Credit Line covenants, specifically the new 17.5% limit on mortgage loans outstanding for more than 30 months.
• Loan Maturities: Review the schedule of loans originally due in Q1 2026 ($4.5 million) to assess extension rates and potential refinancing risks.
• REIT Compliance: Monitor dividend payout ratios to ensure the company maintains its 90% REIT taxable income distribution requirement to avoid corporate taxation.
• Share Repurchases: Track the remaining capacity of the $100,000 share repurchase program (90,700 shares remaining as of March 31, 2026).