Alpine Income Property Trust, Inc. (PINE) Earnings

Management highlights

- Investment Activity and Portfolio Improvements * Total Q2 2026 investment activity reached $77 million at a blended initial yield of 8.7%, growing annualized base rent to $50 million and increasing the share of investment-grade tenant ABR from 50% to 55%, as 84% of Q2 acquisitions were investment-grade tenanted. * Acquired three net lease properties for $36.6 million at a weighted average initial cap rate of 7.4% and 9.2-year weighted average remaining lease term, including a three-property portfolio leased to Aldi, HomeGoods, and Petco, plus two ground-leased properties (Lowe's and Sony Group subsidiary Alamo Drafthouse). * Portfolio overall occupancy hit 99.5% at quarter end, with only one meaningful vacancy (the former Party City location, which has a signed new lease pending permitting). - Capital Markets and Balance Sheet * Opportunistically utilized ATM equity programs during Q2, raising $21.7 million in net proceeds from 1.1 million common shares (weighted average price $19.31 per share) and $3.9 million in net proceeds from 156,000 Series A preferred shares. Year-to-date net proceeds from ATM programs totaled $61.7 million. * Net debt to pro forma adjusted EBITDA improved to 6.4x, down from 6.6x last quarter and 6.7x at the start of 2026. Total debt outstanding was $369.5 million at quarter end with a 4.38% weighted average interest rate, and no debt maturities until 2029 after the 2026 credit facility recast. * Total available liquidity at quarter end was approximately $83 million including cash on hand. - Dividend Action * The board of directors authorized a 6.7% increase in the quarterly common dividend to $0.32 per share, effective Q3 2026. The new dividend represents a conservative 55% AFFO payout ratio based on Q2 2026 AFFO. * The 8% Series A preferred stock will maintain a $0.50 per share quarterly dividend.

Guidance

- Full year 2026 FFO guidance was adjusted to a range of $2.10 to $2.13 per diluted share, with the low end increased from prior guidance; full year AFFO guidance was similarly adjusted to a range of $2.12 to $2.15 per diluted share, also with an increase to the low end. - Total annual investment volume guidance remains unchanged at $170 million to $200 million. - Disposition volume guidance was revised downward to a new range of $20 million to $40 million, from the prior range of $30 million to $60 million; the downward revision reflects timing to complete lease extensions on held-for-sale properties to secure higher valuations, not a strategic shift away from dispositions. - Guidance does not include any potential incentive management fee, as no incentive fee has historically been paid, and any 2026 incentive fee would only be calculated and recorded in Q4 2026 per the terms of the management agreement.

Segment performance

Alpine Income Property Trust operates two core segments: net lease real estate properties and commercial loan investments. 1. Net Lease Real Estate Segment: For Q2 2026, the segment generated $12.6 million in lease income, accounting for 63% of total company revenue of $20 million. At quarter end, the segment had 128 properties totaling 4.5 million square feet across 31 states, with 99.5% occupancy and a weighted average remaining lease term of 9.2 years. Annualized base rent (ABR) for the segment reached $50 million, with 55% of ABR attributable to investment-grade rated tenants. Five properties qualifying as sales-type leases under GAAP represent 12.6% of total straight-line ABR ($6.3 million) and 10.6% of annualized in-place cash rent ($5.1 million), with payments recorded as interest income rather than lease income. 2. Commercial Loan Investment Segment: For Q2 2026, the segment generated $7.3 million in interest income, accounting for 36.5% of total company revenue. At quarter end, the portfolio held 13 loans with an outstanding face amount of $167 million and a weighted average coupon rate of 13.2%, maintaining the targeted 20% share of total undepreciated asset value. During the quarter, the company originated a new $40 million first mortgage loan ($6.2 million funded in Q2) with an initial 10% yield, and received full repayment of $8 million in existing lower-yielding (8%) loans to recycle capital into higher-return investments. Year-to-date 2026, the segment generated $13.1 million in interest income out of total company revenue of $38.4 million.

Risks & headwinds

- Forward-looking statements are subject to inherent uncertainty, and actual future results may differ materially from expectations, with key risk factors detailed in the company's periodic SEC filings (Form 10-K, Form 10-Q). - Unfunded commercial loan commitments carry uncertainty around full drawdown: borrowers may secure alternative financing or sell the underlying development before full drawdown, leading to early loan termination rather than full capital deployment. - Acquisition pipelines carry execution risk: not all targeted acquisitions will complete due to due diligence findings, transaction delays, or market changes. - Interest rate risk: maturing interest rate swaps were replaced with higher fixed SOFR rates, increasing overall interest expense for the company's term debt. - Commercial theater properties remain a niche acquisition category, with limited available high-credit opportunities following industry stress over the past six years.

Analyst Q&A

• Q: The loan portfolio is already near the 20% of total assets target. Will management exceed this target for attractive opportunities, where will new investments be focused, and how will they be funded? Also, what caused the downward revision to disposition guidance? /

  A: Management will not let the loan portfolio rise meaningfully above 20% — any temporary overage would be corrected by upcoming loan payoffs that will bring it back to or below target. Most of the current robust pipeline consists of net lease real estate investments. Acquisitions will initially be funded via the company's line of credit, supplemented by dispositions and opportunistic ATM equity issuance as needed. The lower disposition guidance is a timing adjustment, not a strategic shift: some targeted properties are now waiting for lease extensions from current tenants to achieve higher sale valuations, so sales are pushed into future periods.

• Q: After adjusting for Q2's one-time items, what is the current run rate AFFO per share, and how do upcoming changes impact this run rate? /

  A: Q2 2026 reported AFFO of 58 cents per share includes two cents per share of one-time other income from a kept non-refundable deposit on a terminated sale contract. Additionally, a 130 basis point increase in swap rates for the 2029 term loan took effect this quarter, with a second similar increase coming in Q1 2027 for the 2031 term loan, and new equity issued in Q2 will have a full quarter impact on management fees starting in Q3. After these adjustments, the current base AFFO run rate is ~52 cents per share, which will grow as new capital is deployed into new investments.

• Q: Is there a specific target percentage for investment-grade tenant exposure in the property portfolio? /

  A: Management has no hard fixed target for investment-grade exposure. 50%+ is considered a good range for the company, and the current 55% level is near the high end of where management expects it to stay, though it may tick slightly higher in the next quarter from additional acquisitions of investment-grade tenanted properties.

• Q: What are the key terms of the new $40 million Publix-anchored development loan originated in Q2, and what is the company's strategy for this type of lending? /

  A: The loan targets 80%+ loan-to-cost for the development, which is higher than typical bank lending for these projects. Once completed, the loan will equal ~70-75% loan-to-value based on stabilized market valuations for the completed development. The company also retains a right of first offer to purchase the developed pad sites if they become available at attractive cap rates that meet the company's return targets.