Hartman vREIT XXI, Inc.
Hartman vREIT XXI filed a consolidated 10-K covering fiscal years 2023 and 2024 after failing to timely file any periodic reports for those periods. FY2024 revenue was $15.1M (-4.9% YoY), net income was $2.0M (vs. a $27.0M loss in FY2023), and EPS was $0.22. The FY2024 profit was entirely attributable to a $5.6M gain from a property disposition; operating loss was $2.7M. The company disclosed material weaknesses in internal controls and has suspended both distributions (since December 2022) and its share redemption program indefinitely.
- FY2024 revenue fell 4.9% YoY to $15.1M from $15.8M, driven by occupancy decline from 83% to 81%.
- Net income swung to $2.0M in FY2024 from a $27.0M loss in FY2023, almost entirely due to a $5.6M gain on property disposition.
- FY2023 loss was driven by a $20.2M allowance for expected credit losses and a $5.1M impairment on unconsolidated entities.
- The company disclosed material weaknesses in internal control over financial reporting and did not file any periodic reports for FY2023 or FY2024 on time.
- Distributions have been suspended since December 16, 2022, and the share redemption program remains indefinitely suspended.
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A non-traded REIT emerging from multi-year filing delinquency with material weaknesses, suspended redemptions, and a core operating loss masked by a one-time property sale.
This non-traded REIT's struggles mirror broader stress in the Class B suburban office sector, where occupancy pressure and tenant credit deterioration have forced write-downs. The multi-year filing delinquency and material weakness disclosure place it among the more distressed small-cap REITs.
Material weaknesses in internal control over financial reporting caused multi-year filing delinquency. The company's largest credit facility matures after July 2027, creating refinancing risk. Shares are illiquid with no public market and a suspended redemption program. The portfolio is concentrated in Class B suburban office assets in Houston and San Antonio, exposed to post-pandemic office demand erosion.