Rithm Property Trust Inc. (RPT) Business

ITEM 1. BUSINESS

Overview

Rithm Property Trust (formerly Great Ajax Corp.), a Maryland corporation, is an externally managed REIT formed on January 30, 2014, and capitalized on March 28, 2014, by its then sole stockholder, Aspen Yo LLC, an affiliate of the Aspen Capital group of companies. The Company focuses on investments in the CRE sector.

On June 11, 2024, the Company completed its previously announced strategic transaction with Rithm (such transactions together, the “Strategic Transaction”). In connection with the Strategic Transaction, the Company entered into a Securities Purchase Agreement (the “SPA”) pursuant to which, following stockholder approval on May 20, 2024, it issued $14.0 million of common stock, par value $0.01 (“Common Stock”), to Rithm. The Company also entered into a management agreement, dated June 11, 2024 (as amended by that First Amendment to the Management Agreement, dated October 18, 2024, and as further amended by that Second Amendment to the Management Agreement, dated February 12, 2026, and as may be further amended, modified or supplemented from time to time, the “Management Agreement”) with RCM GA, which became the Company’s external manager; terminated its prior management agreement; entered into a term loan with a subsidiary of Rithm; and issued warrants to Rithm to purchase shares of the Company’s Common Stock. The Company relocated its corporate headquarters to New York, New York, and on December 2, 2024, rebranded and changed its name to Rithm Property Trust Inc.

In connection with the Strategic Transaction, the Company terminated its prior loan servicing arrangement and disposed of its interest in Great Ajax FS LLC. Effective June 1, 2024, servicing of the Company’s mortgage loans and real property was transferred to Newrez, an affiliate of Rithm and the Manager, pursuant to the Servicing Transfer Agreement (as defined below). The terms of the underlying servicing agreements remain unchanged.

Under RCM GA’s management, the Company repositioned its business from a predominantly residential mortgage strategy to a flexible CRE focused investment strategy, which includes originating and acquiring CRE-related investments and managing a diversified portfolio of assets. The Company believes current market conditions are creating refinancing challenges and capital dislocations in the CRE sector that may present attractive risk-adjusted investment opportunities. Target investments may include senior and subordinated mortgage loans, mezzanine loans, preferred equity, commercial mortgage servicing rights, CRE properties and other CRE-related debt and equity investments. The Company has largely transitioned away from residential mortgage loans and RMBS and does not expect to make further investments in RPLs, NPLs or RMBS.

The Company expects to finance its investments through a variety of capital sources, which may include secured and unsecured credit facilities, capital markets transactions, securitizations and other corporate financing arrangements, depending on market conditions and investment characteristics. Through its external Manager, the Company leverages Rithm’s real estate and capital markets expertise across sourcing, underwriting, financing, asset management and disposition. The Company believes the flexibility of its investment strategy and its ability to actively manage assets position it to generate attractive long-term returns for stockholders across a range of market conditions.

In December 2025, as part of the execution of its CRE investment strategy, the Company acquired an indirect minority interest in PGOP, which through its affiliates and joint ventures owns a portfolio (the “PGRE Portfolio”) of CRE properties, through an investment (the “PGRE Investment”) in affiliated aggregator vehicles formed in connection with Rithm’s acquisition of Paramount Group, Inc. (“Paramount”). The PGRE Portfolio consists of ten properties: 1633 Broadway, 1301 Avenue of the Americas, 1325 Avenue of the Americas, 31 W 52nd Street, 712 Fifth Avenue, 1600 Broadway and 900 3rd Avenue in New York, New York and One Market Plaza, 300 Mission Street and One Front Street in San Francisco, California. The Company made an initial cash investment of $50.0 million and committed to make up to an additional $7.5 million of capital contributions under certain circumstances. The PGRE Investment was approved by the Company’s independent directors and was funded with cash on hand.

On December 19, 2025, the Company’s board of directors (the “Board of Directors”) approved a reverse stock split, which was effected on December 30, 2025, of its Common Stock at a ratio of one share for every six shares issued and outstanding (the “Reverse Stock Split”). Unless otherwise indicated, all share and per-share amounts in this Annual Report on Form 10-K have been retroactively adjusted to reflect the Reverse Stock Split.

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Investment Guidelines

We make investment decisions pursuant to broad investment guidelines adopted by our Board of Directors on June 11, 2024. As a result, we may, without obtaining stockholder approval, modify our target asset classes and acquire a range of investments that may differ from, and may be riskier than, those held in our current portfolio.

The Board of Directors has adopted these guidelines to evaluate potential investments. The guidelines prohibit any investment that would cause us to fail to qualify as a REIT or that would cause us to be regulated as an “investment company” under the Investment Company Act. The guidelines also contemplate that our investments will be primarily in the types of assets described under “Proposal 4—Management Proposal—Strategy of Rithm” in the Company’s definitive proxy statement filed with the United States (“U.S.”) Securities and Exchange Commission (“SEC”) on April 10, 2024. The Board of Directors may amend the investment guidelines at any time, without stockholder approval. If the Board of Directors materially modifies the investment guidelines, we will disclose the change in our next required periodic report or otherwise as required by applicable law.

All of our investment activities are conducted by our external Manager pursuant to the Management Agreement, which remains in effect until June 11, 2027 and will automatically renew for successive two-year terms, subject to certain termination rights as described therein. Our principal objective is to generate attractive risk-adjusted returns for our stockholders over the long-term through dividends and capital appreciation.

Financing Strategy

Our objective is to generate attractive risk-adjusted returns for our stockholders, and we may use leverage as part of our strategy. The amount of leverage we use for a particular investment is determined based on a range of factors, which may include the expected liquidity and price volatility of the asset; the duration profile of our assets and liabilities (including any hedges); the availability and cost of financing; our assessment of the creditworthiness of financing counterparties; conditions in the U.S. economy and the commercial and residential mortgage and real estate markets; our interest rate outlook; the credit quality of the loans underlying our investments; and our view of asset spreads relative to financing costs. See Note 9—Debt to our consolidated financial statements included in this Annual Report for additional information regarding our debt obligations.

We do not currently hedge portfolio risks associated with our investment portfolio. However, we may seek to mitigate interest rate risk related to our financing obligations. Our financing arrangements may from time to time bear interest at floating rates, typically based on a stated spread over a reference index. A sustained increase in interest rates could increase our financing costs. To manage this exposure, we may use derivative instruments, such as interest rate swaps or interest rate options, to reduce the variability of earnings attributable to changes in the interest rates applicable to our debt. We may also seek to align our interest rate exposure by funding floating-rate investments with floating-rate liabilities.

Any derivative transactions would be entered into solely for risk management purposes and not for investment or speculative purposes. The use of derivatives may expose us to certain risks, including market and interest rate risk, timing and volatility risk, counterparty and credit risk, and reduced market liquidity. As a result, derivatives may not be effective in offsetting changes in our financing costs. No derivative instruments are currently outstanding.

Policies with Respect to Certain Other Activities

Subject to the approval of our Board of Directors, we have the authority to offer our Common Stock or other equity or debt securities in exchange for property. We are also authorized to repurchase or otherwise reacquire our Common Stock or any other securities, and we may engage in these activities from time to time in the future.

We also may make loans to, or guarantee certain obligations of, our subsidiaries.

Subject to the ownership limitations and the gross income and asset tests required to maintain our qualification as a REIT, we may invest in securities of other REITs, other entities engaged in real estate-related activities, or other issuers, including for the purpose of acquiring or exercising control over such entities. We may also buy and sell investments in the ordinary course of managing our portfolio.

Our Board of Directors may modify these policies or our investment guidelines without obtaining stockholder approval. If we determine to raise additional equity capital, the Board of Directors has authority, without stockholder approval (subject to applicable New York Stock Exchange (“NYSE”) requirements), to issue additional shares of Common Stock or preferred stock on such terms, and for such consideration, as it deems appropriate, including in exchange for property.

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Decisions regarding the form and other terms of financing for our investments are made by our officers, subject to the general investment guidelines adopted by the Board of Directors.

Management Agreement

Management Agreement

On June 11, 2024, we entered into the Management Agreement, as amended on October 18, 2024. The Management Agreement will remain in effect through June 11, 2027 and will automatically renew for successive two-year terms thereafter, unless terminated by either party in accordance with its terms.

Pursuant to the Management Agreement, RCM GA is responsible for implementing our business strategy and managing our business, investment activities and day-to-day operations, subject to oversight by our Board of Directors. RCM GA provides a management team and the administrative and support personnel necessary to conduct our operations. We do not have any employees and do not expect to have any employees in the foreseeable future. Each of our executive officers is an officer, employee, consultant or contractor of RCM GA or its affiliates.

Under the Management Agreement, RCM GA is entitled to receive a base management fee and an incentive fee, each calculated and payable quarterly in arrears, in cash or, at the election of RCM GA, in shares of our Common Stock.

The base management fee is equal to 1.5% per annum of our stockholders’ equity, including equity equivalents. For purposes of calculating stockholders’ equity, unsecured debt securities are included to the extent the proceeds were used to repurchase our preferred stock.

RCM GA is also entitled to receive an incentive fee equal to 20% of the amount by which earnings available for distribution (“EAD”) for the applicable quarter exceeds an annualized return of 8% on our average common book value per share during such quarter, as adjusted to exclude certain items, including fair value marks, impairments, transaction and deal expenses and associated tax impacts. No incentive fee is payable unless cumulative EAD is positive for the most recently completed four calendar quarters (or, if shorter, since the effective date of the Management Agreement or the most recent reset date). Cumulative EAD is reset at the end of each four-quarter measurement period.

EAD is a non-GAAP (as defined below) financial measure defined as net income (loss) determined in accordance with generally accepted accounting principles (“GAAP”), excluding non-cash equity compensation expense and unrealized gains or losses from mark-to-market valuation changes, including impairments. EAD may also be adjusted, on a tax-effected basis, to exclude certain one-time events, transaction and deal expenses and other non-cash items, subject to discussion with and approval by a majority of independent members of the Board of Directors.

In addition to the base management fee and incentive fee, we reimburse RCM GA and its affiliates for costs and expenses incurred in providing services under the Management Agreement, including our allocable share of compensation and benefits paid to personnel providing finance, accounting, tax, legal, risk management, compliance, operations, internal audit and other non-investment services.

The Management Agreement provides for the payment of a termination fee in certain circumstances, including termination without cause, non-renewal by the Company under specified conditions or termination by RCM GA following certain events. The termination fee generally equals three times the base management fee plus the greater of (i) three times the incentive fees paid during the trailing twelve-month period or (ii) the incentive fee that would have been earned based on total unrealized gains as of the most recently completed fiscal quarter prior to termination.

Former Management Agreement

Prior to June 11, 2024, we were party to a Third Amended and Restated Management Agreement, dated as of April 28, 2020, with Thetis Asset Management LLC (the “Former Manager”) (as amended by that First Amendment, dated March 1, 2023, the “Former Management Agreement”). Under the Former Management Agreement, the Former Manager implemented our business strategy and managed our operations, subject to oversight by the Board of Directors, and provided management, administrative and support personnel. We also separately maintained an internal audit function that reported directly to the Audit Committee and the Board of Directors.

Under the Former Management Agreement, we paid a quarterly base management fee based on stockholders’ equity, including certain equity equivalents, and were also subject to an incentive fee based on cash distributions and changes in book value. We had the option to pay management fees in cash or in shares of our Common Stock.

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In connection with the Strategic Transaction, we delivered a termination notice to the Former Manager on February 26, 2024 and terminated the Former Management Agreement, effective June 11, 2024. In connection with the termination, we entered into a termination and release agreement with the Former Manager, which provided for the issuance of approximately 0.5 million shares of Common Stock and the payment of $0.6 million in cash to the Former Manager.

Servicing Agreements

Until June 1, 2024, our mortgage loans and real property were serviced pursuant to various servicing agreements (the “Servicing Agreements”) with Gregory Funding LLC (the “Former Servicer” or “Gregory”). We owned a 9.72% equity interest in the Former Servicer, which we disposed of during the quarter ended June 30, 2024. Effective June 1, 2024, the Former Servicer transferred the Servicing Agreements to Newrez, an affiliate of our Manager, pursuant to a servicing transfer agreement (the “Servicing Transfer Agreement” and, such Servicing Agreements following the transfer, the “Newrez Servicing Agreement”). The material terms of the Servicing Agreements remain substantially unchanged.

If the Newrez Servicing Agreement is terminated other than for cause and/or the Servicer terminates the agreement, we are required to pay a termination fee equal to the aggregate servicing fees paid under the applicable Servicing Agreement for the immediately preceding 12-month period.

Competition

In acquiring and originating our CRE-related investments, we compete with a broad range of market participants, including commercial mortgage and hybrid REITs, private equity and real estate funds, hedge funds, credit funds, specialty finance companies, banks, mortgage bankers, insurance companies, investment banking firms, mutual funds and other financial institutions, as well as governmental and quasi-governmental entities. Many of our competitors are significantly larger than we are, have greater access to capital and other resources and may have operating or regulatory advantages that allow them to transact more quickly or at larger scale. In addition, new market entrants and existing firms may increasingly pursue strategies similar to ours, particularly in the CRE sector, which could intensify competition for attractive investment opportunities and for equity and debt capital. Increased competition may reduce the availability of, or increase the price for, CRE-related investments and could adversely affect the market price of our Common Stock and preferred stock. Further, certain competitors may have higher risk tolerances or different risk assessments, which could allow them to pursue a broader range of CRE assets and establish business relationships that we may not pursue.

We may not be able to achieve our business objectives due to the competitive risks that we face.

Operating and Regulatory Structure

Tax Requirements

We have elected and intend to continue to qualify to be taxed as a REIT for U.S. federal income tax purposes. Our REIT qualification depends on our ability to satisfy, on an ongoing basis, numerous and complex requirements under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), relating to, among other things, the sources and nature of our gross income, the composition and value of our assets, the timing and amount of distributions to our stockholders and the concentration of ownership of our capital stock. We believe that we have been organized and have operated in conformity with the requirements for qualification and taxation as a REIT under the Internal Revenue Code commencing with our initial taxable year ended December 31, 2014, and we intend to continue to operate in a manner that will enable us to maintain our REIT qualification.

As a REIT, we generally are not subject to U.S. federal income tax on taxable income that we distribute to our stockholders, provided that we distribute at least 90% of our REIT taxable income (determined without regard to the dividends paid deduction and excluding net capital gain) each year and satisfy certain other requirements.

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Investment Company Act Exclusion

We conduct our operations so that neither we nor any of our subsidiaries is required to register as an investment company under the Investment Company Act. Section 3(a)(1)(A) of the Investment Company Act generally defines an investment company as any issuer that is, or holds itself out as being, engaged primarily in the business of investing, reinvesting or trading in securities. Section 3(a)(1)(C) of the Investment Company Act generally defines an investment company as any issuer that is engaged or proposes to engage in the business of investing, reinvesting, owning, holding or trading in securities and that owns or proposes to acquire “investment securities” having a value exceeding 40% of the value of the issuer’s total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis (the “40% test”).

Securities issued by majority-owned subsidiaries that are not themselves investment companies and that do not rely on the exclusions set forth in Section 3(c)(1) or Section 3(c)(7) of the Investment Company Act are excluded from the definition of “investment securities” for purposes of the 40% test.

Our majority-owned subsidiaries rely on exclusions from the definition of investment company pursuant to Sections 3(c)(5)(C) or 3(c)(6) of the Investment Company Act. Section 3(c)(5)(C), as interpreted by the staff of the SEC, requires an entity to invest at least 55% of its assets in “mortgages and other liens on and interests in real estate” (“qualifying real estate interests”) and at least 80% of its assets in qualifying real estate interests together with “real estate-related assets” (the “3(c)(5)(C) Real Estate Assets Tests”). Section 3(c)(6) generally excludes from the definition of investment company any company that is directly or through subsidiaries primarily engaged in real estate activities described in Section 3(c)(5)(C) and/or other banking or finance businesses that are themselves excepted from the definition of “investment company” pursuant to Sections 3(c)(3), 3(c)(4) or 3(c)(5) of the Investment Company Act.

We are organized as a holding company and conduct our businesses primarily through wholly owned subsidiaries of Great Ajax Operating Partnership L.P., a Delaware limited partnership (the “Operating Partnership”). Our Operating Partnership holds real estate and real estate-related assets directly and through subsidiaries. We conduct our operations so that we, our Operating Partnership and Great Ajax Funding LLC (“Great Ajax Funding”) (i) do not meet the definition of an investment company under Section 3(a)(1)(C) by ensuring that less than 40% of the value of our total assets on an unconsolidated basis consists of “investment securities,” or (ii) satisfy the 3(c)(5)(C) Real Estate Assets Tests or the “primarily engaged” test under Section 3(c)(6). We continuously monitor our compliance with these tests and the asset holdings of our subsidiaries to ensure that each subsidiary qualifies for an applicable exemption or exclusion from registration under the Investment Company Act.

Our 19.8% equity interest in our Former Manager is held through GA-TRS LLC (“GA-TRS”), a special purpose subsidiary of our Operating Partnership. GA-TRS may rely on Section 3(c)(1) or Section 3(c)(7) of the Investment Company Act, and accordingly our interest in GA-TRS constitutes an “investment security” for purposes of the 40% test. We may also form other wholly owned or majority-owned subsidiaries that invest in real estate-related assets and that rely on the exclusions provided by Sections 3(c)(1) or 3(c)(7). The value of the securities issued by any such subsidiaries, together with any other investment securities we may own, will not exceed 40% of the value of our total assets on an unconsolidated basis, or we will otherwise satisfy the 3(c)(5)(C) Real Estate Assets Tests or the Section 3(c)(6) primarily engaged test.

On August 31, 2011, the SEC issued a concept release entitled Companies Engaged in the Business of Acquiring Mortgages and Mortgage-Related Instruments (Investment Company Act Rel. No. 29778), which indicates that the SEC continues to review the scope and application of the Section 3(c)(5)(C) exclusion. There can be no assurance that future laws, regulations, interpretations or guidance from the SEC or its staff regarding the classification of qualifying real estate interests or real estate-related assets will not change in a manner that adversely affects our ability to rely on this exclusion. To the extent additional guidance is provided, we may be required to modify our investment strategy or asset composition, which could limit our ability to pursue our current strategies or adversely affect our operations.

If we were to lose our exclusion from regulation under the Investment Company Act, we could be required to restructure our operations, dispose of certain assets or refrain from acquiring certain assets, any of which could materially adversely affect our financial condition, results of operations and/or cash flows. See “Item 1A. Risk Factors—Risks Related to Our Organizational Structure—Maintenance of our exclusion from regulation as an investment company under the Investment Company Act imposes significant limitations on our operations.”

Commodity Pool Operator Exemption

Under the Dodd-Frank Act, an investment vehicle that trades in swaps may be deemed a “commodity pool,” which could cause its operator to be regulated as a “commodity pool operator” (“CPO”) under the Commodity Exchange Act and related Commodity Futures Trading Commission (“CFTC”) rules. We rely on CFTC no-action relief from CPO registration and have filed the applicable notice/claim with the CFTC in order to rely on such relief.

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To maintain the benefit of this no-action relief, we must satisfy certain conditions, including, among other requirements, that (i) the aggregate initial margin and option premiums required to establish our swap and futures positions do not exceed 5% of the fair market value of our total assets, and (ii) the net income we derive annually from swap and futures positions that are not “qualifying hedging transactions” remains below 5% of our gross income.

Operating within these parameters may limit our ability to use swaps or futures to the extent we would otherwise consider appropriate, and failure to satisfy the conditions of the no-action relief could require us (or certain of our affiliates or personnel) to register as a CPO and become subject to additional regulation and compliance requirements. See “Item 1A. Risk Factors—Risks Related to Regulatory and Legislative Actions—We may be unable to operate within the parameters that allow us to be excluded from regulation as a CPO, which would subject us to additional regulation and compliance requirements, and could materially adversely affect our business and financial condition.”

Environmental Matters

To the extent we own or acquire real estate, we are subject to a variety of U.S. federal, state and local environmental laws, regulations and ordinances and may incur liability for environmental conditions at, on, under or migrating from such properties. Environmental laws may impose liability on owners and operators of real property for the investigation and remediation of contamination, regardless of whether the owner or operator knew of, or was responsible for, the presence of hazardous substances. The costs of required investigation, remediation or compliance could be substantial, and liability under certain environmental laws may be joint and several and is often not limited, potentially exceeding the value of the affected property and, in some circumstances, our other assets. In addition, the presence of contamination or failure to remediate contamination could expose us to third-party claims for personal injury or property damage and could adversely affect our ability to sell, lease, develop, renovate or finance such properties, including our ability to borrow using the real estate as collateral. See “Item 1A. Risk Factors.”

Employees

We do not currently have any employees who are paid directly by us, and we do not expect to have any employees paid directly by us in the foreseeable future, with the exception of incentive equity awards that may be issued. We conduct our operations through our Manager and its affiliates, and our executive officers are officers, employees or contractors of the Manager (or its affiliates) and are compensated by the Manager (or its affiliates). We reimburse the Manager or its affiliates, as applicable, for our allocable share of compensation and related costs (whether paid in cash, equity or other forms), including base salary, bonuses, payroll taxes and employee benefits, for (i) the personnel serving as our chief financial officer, based on the percentage of time devoted to managing our affairs, and (ii) other corporate support personnel, including corporate finance, tax, accounting, middle office, internal audit, legal, risk management, operations and compliance, who devote all or a portion of their time to supporting and managing our business.

Available Information

Our website is www.rithmpropertytrust.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are available to the public from the SEC’s website at http://www.sec.gov and are made available on our website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.

Also posted on our website in the “Company Info—Corporate Governance” section are charters for our Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, as well as our Corporate Governance Guidelines and certain of our policies, including our Code of Ethics governing our Board of Directors, officers and employees.

The information on our website does not constitute a part of this Annual Report and is not incorporated by reference. Our reference to the URL for our website is intended to be an inactive textual reference only.