American Strategic (NYC) Sales Drop 23%

Key Points

• Net loss per share (GAAP) improved to ($16.39) in Q2 2025, compared to ($36.48) in Q2 2024, but the company remains deeply unprofitable.

• Revenue (GAAP) dropped 22.8% to $12.2 million in Q2 2025, mainly due to the prior sale of a major property and not operational gains.

• Adjusted EBITDA was $0.4 million in Q2 2025, down from $7.416 million in Q2 2024 (cash net operating income, non-GAAP), showing sharply lower recurring earnings.

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American Strategic Investment Co. (NYSE:NYC), a real estate company focused on New York City commercial properties, published its second quarter results on August 8, 2025. The headline result was another sizable net loss, though the GAAP loss per share was cut in half from the prior year. Revenue (GAAP) fell to $12.2 million from $15.8 million, a decline attributed to the sale of a major asset, 9 Times Square. Adjusted EBITDA, which strips out non-cash and one-time items, plunged more than 90% year-over-year. Since there were no analyst estimates available for the quarter, results are best measured against the company’s prior year period and internal targets. Despite a few signs of operational progress, the quarter highlighted the continued strain on profitability and cash generation.

Business Overview and Recent Directions

American Strategic Investment Co. manages a portfolio of New York City office properties. As of Q2 2025, its holdings include six properties totaling 1.0 million square feet of rentable space. Its tenant mix is diverse, with exposure to financial services, government entities, retail, non-profits, and other industries.

Recently, the company shifted its strategy by converting from a real estate investment trust (REIT) to a taxable C corporation. This change allows it greater flexibility to branch out beyond traditional commercial real estate investments and target new property types, such as hospitality or residential assets. The company is also pursuing portfolio diversification and aims to recycle capital from asset sales into different, potentially higher-yielding properties. Success now depends on effective property management, tenant retention, high occupancy, and prudent financial controls.

Quarter in Detail: Financial and Operational Insights

The quarter’s most noticeable trend was the steep drop in revenue, which fell 22.4% from the prior year’s $15,754,000 to $12,222,000 (GAAP). This decline was almost entirely explained by the sale of 9 Times Square in the prior year, which reduced the number of income-producing properties. The ongoing loss position improved, with net loss per share (GAAP) narrowing from ($36.48) to ($16.39), mainly due to smaller property impairments.

Adjusted EBITDA, a non-GAAP measure of ongoing cash profits before interest, taxes, and non-cash expenses, fell to $0.4 million from $4.5 million year-over-year. Cash net operating income (non-GAAP), which measures cash earned from properties after operating expenses but before interest and taxes, dropped 43% to $4.2 million year-over-year.

Impairment charges, which reflect reductions in estimated property value, were $30.6 million (GAAP) in Q2 2025. This is still high but represents a sharp decline from $84.7 million in GAAP impairments of real estate investments in the prior year. The company’s book value continued to decline under the weight of persistent losses and property sales. Total assets (GAAP) now stand at $464.0 million as of June 30, 2025, down from $507.1 million as of December 31, 2024. Equity (GAAP) fell to $35.5 million at June 30, 2025, from $85.6 million at December 31, 2024, highlighting ongoing capital depletion.

Debt levels remain high. Net debt is $344.7 million as of Q2 2025, with a net debt-to-gross-asset ratio of 63.6% as of Q2 2025, which indicates more than half of assets are funded with borrowings. Management reports all debt is fixed-rate, with an average interest rate of 6.4% as of Q2 2025. However, interest expenses (GAAP) surged to $7.9 million from $5.2 million year-over-year. Liquidity is another concern. Cash and cash equivalents (GAAP) were $5.3 million as of Q2 2025. While restricted cash may buffer this shortfall, it’s not always available for operations.

Operationally, portfolio occupancy held steady at 82.0% in Q2 2025, essentially flat compared to Q1 2025, and slightly up from about 80.8% at December 31, 2024. The weighted-average remaining lease term grew to 6.0 years as of Q2 2025, reflecting lease extensions at two key Manhattan properties: 123 William and 1140 Avenue of the Americas. Additionally, 77% of the rent from the top ten tenants comes from companies with investment-grade or near investment-grade ratings. The company’s property portfolio remains highly concentrated in New York City. This heavy exposure continues to make the company’s results sensitive to challenges in that market, such as changes in office work patterns and tenant demand.

The company’s efforts at diversification, such as targeting asset classes outside the traditional NYC office segment, have yet to show up in the numbers. No new investments or income streams outside New York City office properties were cited during the period.

Management Commentary and Looking Ahead

The company’s management did not provide clear guidance for the remainder of fiscal 2025. Its earnings release emphasized ongoing risks from the New York City real estate market, high debt levels, and possible NYSE delisting. Plans to diversify property types and geographies, as outlined following its shift away from the REIT structure, remain a stated goal. However, there were no announcements on deal progress or timelines for these diversification efforts in the period.

Given these circumstances, investors looking ahead may want to monitor ongoing liquidity levels, the pace of asset recycling, changes in occupancy and remaining lease terms, and any material announcements about investments outside New York City. Until new assets or recurring earnings streams emerge, the company’s performance will likely remain closely tied to fluctuating fortunes in the city’s commercial property market.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.

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