and thank you for standing by.

Welcome to the Sunrise Realty Trust Q2 2026 earnings call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our first speaker today, Robin Tannenbaum, President of Sunrise Realty Trust.

Good morning, and thank you all for joining Sunrise Realty Trust's earnings call for the quarter ended June 30, 2026. I'm joined this morning by Len Tannenbaum, our executive chairman, Brian Sedrish, our chief executive officer, and Brandon Hetzel, our chief financial officer. Before we begin, I would like to note that this call is being recorded. Replay information is included in our July 17, 2026 press release and is posted on the investor relations portion of our website at sunrise RealtyTrust.com, along with our second quarter 2026 earnings release and investor presentation. Today's conference call includes forward-looking statements and projections that reflect the company's current views with respect to, among other things, market developments, our investment pipeline, anticipated portfolio yield, financial performance, and projections in 2026 and beyond, and the proposed Suns SRT merger. These statements are subject to inherent uncertainties in predicting future results. Please refer to Sunrise Realty Trust's most recent periodic filings with the SEC, including our quarterly report on Form 10-Q filed earlier this morning, for certain conditions and significant factors that could cause actual results to differ materially from these forward-looking statements and projections. During today's conference call, while management will refer to non-GAAP financial measures, including distributable earnings. Please see our second quarter earnings release available on our website for reconciliations of the non-GAAP financial measures with the most directly comparable GAAP measures. The format for today's call is as follows. Len will provide an update on today's proposed merger announcement. Next, Brian will cover our view on the state of the CRE lending markets, discuss our existing portfolio, and provide an outlook for our investment pipeline. Then, Brandon will provide an update on our financial position. After that, we'll open the lines for Q&A. With that, I will now turn the call over to our Executive Chairman, Len Tannenbaum.

Thank you, Robin. Good morning, and welcome to our second quarter 2026 earnings conference call. Before turning to the proposed merger that we announced earlier today, for the quarter ended June 30th, 2026, Suns generated distributable earnings of $0.29 per basic weighted average share of common stock. For the first six months of 2026, distributable earnings of $0.65 per share exceeded the $0.60 per share of dividends that we declared over the same period. This reflected the continued earnings power of our portfolio. Turning to the proposed merger, earlier today, Today, we announced and filed with the SEC a signed definitive merger agreement under which Sons will acquire Southern Realty Trust, or SRT, a private mortgage REIT on the TCG real estate platform. We believe the transaction represents an attractive opportunity for our stockholders. Under the terms of the proposed transaction, SRT, which has $107 million of equity, will merge into the Suns platform and create a combined company with approximately two hundred ninety million dollars of total equity value on a pro forma basis as of June 30th 2026 upon closing the merger SRT shareholders will receive newly issued Suns common stock based on an exchange ratio that applies a six percent premium to SRT's book value per share relative to Suns book value per share as of the measurement deed. Before turning to the strategic rationale, I want to note that this was an arm's length negotiated process. Sons and SRT each formed an independent special committee comprised entirely of independent directors. Each of the special committees retained outside legal counsel and independent financial advisors with Oppenheimer and company representing Suns, and KBW, Keith, Bruet, and Woods representing SRT. Each of the Suns and SRT special committees and both companies boards unanimously approve the transaction. In connection with the closing, Suns management agreement will be amended and restated. Among other changes, number one, the incentive fee rate will be reduced from 20% to 17.5%. Number two, the hurdle rate will move from 8% to 7%. And number three, Sun's manager will provide a management fee waiver of $1 million in the aggregate over the four quarters following the closing to the benefit of all Sun's stockholders. Strategically, we believe the combination will benefit Sun stockholders in several ways. We expect this transaction to immediately increase our equity base by approximately 60%, which should provide benefits to our cost of capital. A larger platform should provide increased trading, improved and increased trading liquidity, broader index inclusion eligibility, and enhanced access to the unsecured markets. we believe the increased flow and market cap may attract a wider universe of investors who have a minimum market cap threshold for deployment additionally from an operating standpoint we anticipate gna savings on a combined basis which will potentially increase our margins post transaction, as we begin eliminating duplicative accounting, legal, audit, board, and regulatory compliance costs inherent in maintaining two separate REIT platforms. Because management already oversees both portfolios, which contain pieces of the same underlying loans, we believe there is no material integration risk. We currently expect the transaction to close in the fourth quarter of 2026 subject to approval by sons and srt stockholders and the satisfaction of other customary closing conditions sons expects to file a proxy statement with the sec containing additional information until the proxy statement is effective we will limit our comments to the form 8k with that i'll turn it over to brian to discuss the market environment and walk through our portfolio in more detail. Brian?

Thank you, Len. Before reviewing the portfolio, I want to discuss how the current lending environment is translating into opportunities for sons. Looking at the broader market, industry estimates put roughly $900 billion of commercial real estate loans maturing in 2026, with a comparable wave in 2027. Much of it originated between 2019 and 2022 when rates were at historic lows. With rates still elevated, many of those loans now face a refinancing gap. And what matters is the cause of that gap. In most of the situations we target, the issue is not a shortfall in asset value. It's that leverage size in a lower rate environment no longer fits today's senior debt capacity. That gap between yesterday's leverage and today's debt capacity is exactly the space our structured capital fills. Last quarter, we noted that several pipeline transactions were paused as sponsors reassessed their cost of capital mid-rate volatility. That volatility continued through the second quarter, and transaction activity stayed uneven, with borrowers delaying discretionary acquisitions and refinancings. The most durable demand is need-driven. sponsors facing near-term maturities where the incumbent lender will extend only against a principal paydown or fresh equity rather than a simple extension. Borrowers with real equity to protect are the ones most willing to engage in pricing and the structural protections that appropriately compensate us. Liquidity is available and commercial banks have meaningfully re-entered the market, particularly for stabilized and near-stabilized multifamily, industrial, and data center assets. We view that as confirmation of our positioning. That competition is compressing spreads in conventional first mortgage lending, which are the commodity lanes we deliberately do not compete in, and banks are the natural low-cost home for that stabilized product. What has stayed scarce in this cycle is not senior debt. It's equity. More bank liquidity does not fill a sponsor's equity gap, and in many cases, a bank's willingness to extend is conditioned on the borrower funding of paydown it cannot cover a loan. Our model differs from many commercial mortgage rates. Many concentrate on stabilized assets and lean on balance sheet leverage to reach a targeted return. We generate return the other way, through the complexity of transitional business plans, asset level and sponsor underwriting, and negotiated structural protections. Because the unlevered return on that work is higher, we can carry it with comparatively modest corporate leverage, which also leaves us less exposed to the mark-to-market and margin pressure that our more heavily levered model carries. Where competition is concentrated, we step back. Where capital is scarce, we lean in. Patience is not in activity. During the quarter, our team reviewed a significant volume of transactions and declined those that did not meet our return or structure requirements. Our liquidity lets us stay selective rather than accept mispriced risks. Importantly, over the last several weeks, our investment team has seen a noticeable pickup in transactions that fit our targeted criteria, which we believe reflects a growing realization among borrowers and their advisors that rates are staying higher for longer, and that continued inactivity is no longer a viable option. We continue to see healthy financing request volume, and while conversion still depends on pricing, structure, and sponsor alignment, the opportunity set in front of us has broadened. The Panther National Repayment shortly after quarter end is a clean example of the model end-to-end. The credit facility originated on the TCG real estate platform in August 2024 and secured by a 392-acre private golf and residential community in Palm Beach Gardens, Florida, was repaid in full. The investment ran its full cycle in under two years, origination, business plan execution, and repayment at par. Its attractive unlevered return let us hold the position with limited balance sheet leverage. That is the fund's approach, earning returns through underwriting, structuring, and execution rather than through leverage. Our pipeline remains active, and we stay focused on deals with strong risk-adjusted returns. During the second quarter, the TCG real estate platform signed a term sheet for a $93 million senior construction loan for a multifamily development in Texas, which we expect to structure with a third-party partner on an A-note, B-note basis. This is the kind of transitional structured situation we target rather than stabilized senior lending. That is, a ground-up business plan in a specific targeted sub-market with the A-B structure allocating risk to fit our return requirements. We have additional deals in the pipeline and are negotiating further transactions. Turning to the portfolio, I'd like to begin with an update on our owned asset, the Thompson San Antonio. Sons and its affiliates have entered into a purchase and sale agreement to sell the property to a third-party buyer who has funded two non-refundable option payments totaling $6 million, which will be credited against the purchase price should the closing occur on or before September 30, 2026. As part of the transaction, Sons and its affiliates have agreed to provide seller financing to help facilitate the purchase. Separately, Sons and its affiliate continue to pursue available remedies under the former sponsor's guarantee. And during the second half of the year, our priorities are clear. Recycle capital from repayments, continue to fund construction loans in our existing book, and deploy selectively into transactions with strong risk-adjusted returns and negotiated downside protection. With all of our loans current, modest balance sheet leverage, and the Panther proceeds available for redeployment, we look forward to deploying capital into new opportunities with attractive, risk-adjusted returns. With that, I will now turn the call over to Brandon, our Chief Financial Officer.

Thank you, Brian. For the quarter ended June 30, 2026, we generated net interest income of $5.8 million and distributable earnings of $3.9 million, or $0.29 per basic weighted average common share, and had gap net income of $3.1 million, or $0.23 per basic weighted average common share. We believe that providing distributable earnings is helpful to stockholders in assessing the overall performance of Sun's business. Distrital earnings represents net income computed in accordance with GAAP, excluding non-cash items such as stock compensation expense, unrealized gains or losses, and the provision for current expected credit losses, also known as CECL. In the second quarter of 2026, Sun's funded $25.4 million of new and existing loans and received $26 million of repayments. We ended the second quarter of 2026 with $377.4 million of current commitments and $298.7 million of principal outstanding across 14 loans. As of August 3, 2026, our portfolio consisted of $315 million of current commitments and $248.8 million of principal outstanding across 12 loans, which reflects the full repayment of the Panther National Senior Term Loan and construction revolver subsequent to the quarter end. All loans are current and performing with a weighted average portfolio yield to maturity of approximately 12.3%. As of June 30, 2026, our CESOL reserve was approximately $1.1 million, or 37 basis points of loans held at carrying value. As of June 30, 2026, our total debt outstanding was approximately $141.7 million. Subsequent the quarter end, the Panther National Repayment Proceeds were used to reduce our borrowings, and as of August 3rd, 2026, our total debt outstanding was approximately $85.6 million. As of June 30th, 2026, we had total assets of $330.7 million, and our total shareholder equity was $181.8 million, with a book value of $13.45 per share. For the quarter end of June 30th, 2026, the Board of Directors declared a $0.30 stock dividend per share outstanding, which was paid on July 15, 2026 to shareholders of record as of June 30, 2026. For the first six months of 2026, distributive earnings of $0.65 per basic weighted average share exceeds the $0.60 per share of dividends declared over the same period. With that, I will now turn it back over to the operator to start the Q&A.

Thank you, Brandon. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Jade Ramani from KBW. Your line is now open.

Hi, this is Jason Saption on for Jade. Thanks for taking my questions. So just to touch on the SRT deal, do you expect it to be neutral to earnings and dividends or potentially accretive?

The combination of funds and SRT in the merger should get margin benefit from the reduction and G&A costs. There's a lot of duplicative costs. It's the same exact asset, a little bit different proportions. So together, they should get an earnings increase.

Got it. Thank you. And then do you have any interest in pursuing other M&A within the mortgage rate space?

I think one at a time is just fine for us, but thanks for the question.

Got it. Thanks. And so, just curious, what are you seeing on underlying property fundamentals and multifamily and residential in your markets and on the deals backing your loans?

Brian?

Sure. Yeah, I'll take that. It definitely depends on where the assets are located. I would say Generally, we've definitely seen in the markets that we have spent a lot of time in that what was expected has come true and that the absorption has caught up to the supply out there. As we know, there was a cliff in new construction on multifamily, so that certainly helped. it's now getting absorbed. You're seeing some actual rent increases, less concessions in the markets that we're spending time on. So that's certainly a positive. And I see given elevated rates, we certainly are not seeing a tremendous amount of new construction. Depends obviously on the markets and some of the South Florida markets that we play in. We have definitely seen a continued strong demand. I think that will continue. We have to be mindful of absorption and how quickly things lease up, but generally positive. Same thing I would confirm on our existing book as well.

Great. Thanks. And then just as a last question, on the hotel, potentially, what would you expect seller financing to look like, potentially LTV or rate? Would you answer that question?

No. I don't think we can answer this one.

I can't answer at this time, but I would anticipate kind of normal seller note rates.

Got it. Thank you. Sure. Thank you.

Our next question comes from Gaurav Mehta from Alliance Global Partners. Your line is now open.

Yeah, thank you. Good morning. I wanted to ask a few questions on the merger. I understand the rationale that you guys have talked about merging the two REITs, but I guess in terms of timing, Why did you guys decide to pursue this transaction at this time?

The transaction really was, the timing of the transaction was more towards SRT's timing than Sun's timing to the combination, but for Sun's, it increases our scale, it increases our ability to get unsecured financing, which I still would like to get outside unsecured financing. I'd like to get a credit rating. I think that's important. I also would like to redo our credit facilities a little better, when you know size and scale. The other interesting thing, which I don't know if it's clear on this transaction, is either, as I said, the same assets that are split into two buckets, and that provided some complexity for our lenders, because who hasn't controlled the assets and how they would lend the assets and be secured by them. So this removes that complexity, which we think will help us get financing, better financing.

And so in terms of like the overlap on the same asset, is it like 100% overlap between SRT and Sons?

100% of the assets are the same. There are some different proportions of ownership. Every asset in Sons is in SRT.

Okay, understood. And maybe lastly on the valuation in the press release, when you say a 6% premium to SRT's book relative to Sons, does that mean the value for SRT is 1.06 times book? Or how should I think about that, the book value valuation? Brandon?

Yeah, that's the way to think about it. So it was a book value for book value transaction with them giving a 6% premium on their book Okay.

All right. I think that's all I had. Thank you. Thank you.

Thank you. I'm showing no further questions at this time. I would now like to turn it back to Robin Tenenbaum, President of Sunrise Realty Trust, for closing remarks.

Thank you so much for joining us today, and we look forward to keeping you updated on the merger and our progress.

Thank you, Robin, for your participation in today's conference. This does conclude the program. You may now disconnect. Thank you.