CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Background
In 2025 and 2024,
• | Matthew J. Gould, Chairman of our Board of Directors, served as a Senior Vice President and director of BRT Apartments Corp., as Chairman of the Board and Chief Executive Officer (or Manager) of the managing general partner of Gould Investors (which as of the record date owned approximately 10.5% of our outstanding shares of common stock), and as a Vice President/Manager of Majestic; |
• | Fredric H. Gould, Vice Chairman of our Board of Directors, served as a director of BRT Apartments, and prior to July 2, 2025, as the sole owner of Majestic; and |
• | Jeffrey A. Gould, a Director and Senior Vice President of our company, served as a Director, President and Chief Executive Officer of BRT Apartments, as a Senior Vice President and Director (or Manager) of the managing general partner of Gould Investors, and as a Vice President/Manager of Majestic. |
Matthew J. Gould and Jeffrey A. Gould are brothers and the sons of Fredric H. Gould. In addition, David W. Kalish, Mark H. Lundy, Israel Rosenzweig and Isaac Kalish, each of whom is an executive officer of our company, are officers of BRT Apartments and of the managing general partner of Gould Investors. Isaac Kalish, David Kalish’s son, and Steven Rosenzweig, Israel Rosenzweig’s son, are employed by our affiliates. Majestic is controlled by Messrs. M. Gould and J. Gould and is indirectly owned by them and certain of their family members. Certain of our part-time officers, including our part-time named executive officers, are officers of and have received, and may receive, compensation from, Majestic.
Related Party Transactions
Pursuant to the C&SA, Majestic provides us with the Services. In accordance with such agreement, we paid Majestic $3,619,000 and $3,322,000 in 2025 and 2024, respectively, which included $1,628,000 and $1,444,000 for property management services, respectively. In 2026, we will pay Majestic $2,111,000 and in addition, for its property management services, will pay it 1.5% and 2.0% of the rental payments (including tenant reimbursements and deferred rent) actually received by us from net lease tenants and operating lease tenants, respectively. We do not pay Majestic for property management services with respect to properties managed by third parties. Based on our property portfolio at December 31, 2025, we estimate that the property management fee in 2026 will be approximately $1,700,000. Majestic may earn a profit from payments made to it under such agreement. In addition, under this agreement, we also paid Majestic $350,000 and $336,000 in 2025 and 2024, respectively, and will pay Majestic $368,000 in 2026, as reimbursement for our share of direct office expenses, including rent, telephone, postage, computer services, internet usage and supplies.
Majestic allocated an aggregate of $1,971,000 and $1,777,000 to the following officers (some of whom are also officers of Majestic and/or other companies affiliated with us), for the services they performed on our behalf in 2025 and 2024, respectively: David Kalish $254,000 and $244,000; Mark H. Lundy, $283,000 and $276,000; Israel Rosenzweig, $51,000 and $49,000; and Steven Rosenzweig, $147,000 and $121,000. See “Executive Compensation — Summary Compensation Table” for amounts allocated to Messrs. M. Gould, J. Gould and I. Kalish. (No amounts allocated by Majestic were allocated to Frederic H. Gould and as previously reported in this proxy statement under “Governance of the Company — Compensation of Directors,” he received $135,413 and $130,205 in 2025 and 2024, respectively, for serving as Vice Chairman of the Board of Directors). The allocated amounts do not represent the amounts paid to such individuals which may be greater or less than the allocated amounts. These individuals also received compensation in 2025 and 2024 from our other affiliates, including BRT Apartments and Gould Investors, as well as other entities owned or controlled, directly or indirectly, by Messrs. M. Gould and/or J. Gould and/or members of their families. See “Executive Compensation — Compensation of Part-Time Named Executive Officers” for information regarding the determination of amounts paid by Majestic to these officers.
We obtain our property insurance in conjunction with Gould Investors and its affiliates and in 2025 and 2024, we reimbursed Gould $3,042,000 and $1,177,000, respectively, for our share of the insurance premiums.
