Company Summary: Pillarstone Capital REIT

Overview:
Pillarstone Capital REIT is a Maryland-based real estate investment trust (REIT) engaged in investing in, owning, and operating commercial properties. The company's operations are primarily conducted through its ownership and management of various real estate assets.

Properties:

• As of December 31, 2022, owned 8 properties located in Houston, Texas, and Dallas, Texas.
• Total gross leasable area (GLA): approximately 926,798 square feet.
• Key properties include office buildings, industrial parks, and retail locations, with occupancy rates averaging 54%.

Business Focus & Activities:

• Invests in and manages commercial real estate including retail, office, warehouse, industrial, multifamily, and hotel properties.
• Future plans include acquisition, development, and potential mergers or joint ventures in real estate.
• Has historically repositioned underperforming properties through renovation, leasing, and management.
• Owns an approximately 18.6% equity interest in Pillarstone Capital REIT Operating Partnership LP, which consolidates its properties and operations.

Employees & Customer Base:

• As of December 31, 2022, the company has no employees besides three executive officers.
• Operations are conducted through third-party consultants and contractors, overseen by management.

Revenue & Income:

• In 2022, total revenue was approximately $8.7 million, representing a 6% decrease from $9.3 million in 2021.
• Net loss for 2022 was about $1.1 million, compared to a net income of $474,000 in 2021.
• Losses are attributed to decreased occupancy, impact of lease termination by Whitestone REIT, and increased legal expenses related to ongoing litigation.

Financial & Operating Challenges:

• Has a history of operating losses and has incurred significant legal and professional fees.
• Underwent a major internalization of management after Whitestone's abrupt termination of management services in August 2022.
• Is undergoing bankruptcy proceedings involving its main assets and litigation with Whitestone REIT and related parties.
• As of the report date, the company is in the process of rebuilding its financial systems and addressing deferred maintenance and lease re-establishment issues caused by litigation and management transitions.

Market & Shareholder Information:

• Its common shares are quoted on the OTC Markets Group's Expert Market with limited trading activity.
• As of July 21, 2025, there were 657,084 shares outstanding with approximately 250 beneficial shareholders.
• The company has no plans to pay dividends and does not qualify as a REIT, thus subject to federal corporate income tax.
• Key trustees beneficially own a significant portion of the company's common stock (about 62%).

Summary:
Pillarstone Capital REIT manages and invests in commercial real estate assets mainly in Texas, focusing on repositioning and sales strategies. It faces significant legal, financial, and operational challenges due to ongoing litigation and recent management internalization, with a focus on restructuring and managing assets through bankruptcy proceedings.