BROAD STREET REALTY, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-K)

This section provides a discussion of our financial condition and comparative
results of operations and should be read in conjunction with the audited
consolidated financial statements and the notes thereto included in this report.
For more detailed information regarding the basis of presentation for the
following information, you should read the notes to the audited consolidated
financial statements included in this report.

Overview

We are focused on owning and managing essential grocery-anchored and mixed-use
assets located in densely populated technology employment hubs and higher
education centers within the Mid-Atlantic, Southeast and Colorado markets. As of
December 31, 2022, we owned 17 properties. The properties in our portfolio are
dispersed in sub-markets that we believe generally have high population
densities, high traffic counts, good visibility and accessibility, which provide
our tenants with attractive locations to serve the necessity-based needs of the
surrounding communities. As of December 31, 2022, the properties in our
portfolio were 90.4% leased and 84.0% occupied. We are focused on acquiring
additional strategically positioned properties in established and developing
neighborhoods primarily leased to necessity-based tenants that meet the needs of
the surrounding communities in our existing markets, as well as acquiring
properties in new markets that meet our investment criteria, including the
Southeastern United States. In addition, we provide commercial real estate
brokerage services for our own portfolio and third-party office, industrial and
retail operators and tenants.

The table below provides certain information regarding our retail portfolio as of December 31, 2022 and 2021.

                                                               As of                   As of
                                                         December 31, 2022       December 31, 2021
Number of properties                                                     17                      15
Number of states                                                          5                       5
Total square feet (in thousands)                                      2,026                   1,737
Anchor spaces                                                         1,104                     917
Inline spaces                                                           922                     820
Leased % of rentable square feet (1):
Total portfolio                                                        90.4 %                  88.1 %
Anchor spaces                                                          96.3 %                  94.3 %
Inline spaces                                                          83.4 %                  81.3 %
Occupied % of rentable square feet:
Total portfolio                                                        84.0 %                  84.7 %
Anchor spaces                                                          89.6 %                  91.9 %
Inline spaces                                                          77.3 %                  76.7 %
Average remaining lease term (in years) (2)                             5.3                     4.7
Annualized base rent per leased square feet (3)         $             13.76     $             13.83

(1)

Percent leased is calculated as (a) GLA of rentable commercial square feet
occupied or subject to a lease as of December 31, 2022, divided by (b) total
GLA, expressed as a percentage. The total percent occupied, which excludes
leases that have been signed but not commenced, was 84.0% as of December 31,
2022.
(2)
The average remaining lease term (in years) excludes the future options to
extend the term of the lease.
(3)
Annualized base rent per leased square foot is calculated as total annualized
base rent divided by leased GLA as of December 31, 2022.

We are structured as an "Up-C" corporation with substantially all of our
operations conducted through our Operating Partnership and its direct and
indirect subsidiaries. As of December 31, 2022, we owned 85.3% of the OP units
in our Operating Partnership, and we are the sole member of the sole general
partner of our Operating Partnership.

Acquisitions

On November 23, 2022, we completed the acquisition of Midtown Row, a mixed-used
property, and completed our final Merger whereby we acquired Lamar Station Plaza
West. In connection with these acquisitions, we entered into the Eagles Sub-OP
Operating Agreement and closed the related transactions. See "-Fortress
Preferred Equity Investment" below.

During 2021, we closed four additional Mergers whereby we acquired Highlandtown
Village Shopping Center, Cromwell Field Shopping Center, Spotswood Valley Square
Shopping Center and The Shops at Greenwood Village on May 21, 2021, May 26,
2021, June 4, 2021, and October 6, 2021, respectively.
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Impact of COVID-19

We continue to monitor and address risks related to the COVID-19 pandemic.
Certain tenants experiencing economic difficulties during the pandemic have
previously sought rent relief, which had been provided on a case-by-case basis
primarily in the form of rent deferrals and, in more limited cases, in the form
of rent abatements. Since April 2020, we have entered into lease modifications
that deferred approximately $0.6 million and waived approximately $0.3 million
of contractual revenue for rent that pertained to April 2020 through December
2021; we had no lease modification related to COVID-19 during 2022. Less than
$0.1 million of the total deferred rent from all lease modifications since April
2020 remained outstanding as of December 31, 2022.

How We Derive Our Revenue

We derive a substantial majority of our revenue from rents received from our
tenants at each of our properties. Our leases are generally triple net, pursuant
to which the tenant is responsible for property expenses, including real estate
taxes, insurance and maintenance, or modified gross, pursuant to which the
tenant generally reimburses us for its proportional share of expenses. As of
December 31, 2022, our portfolio (i) had annualized base rent of $25.2 million,
(ii) had an annualized base rent per square foot of $13.76, (iii) was 90.4%
leased (84.0% occupied) to a diversified group of tenants and (iv) had no tenant
accounting for more than 4.0% of the total annualized base rent.

With the acquisition of Midtown Row, a mixed-use property, our income is also
derived from student housing, which is leased by the bed on an individual lease
liability basis. Individual lease liability limits each resident's liability to
his or her own rent without the liability of a roommate's rent. A parent or
guardian is generally required to execute each lease as a guarantor unless the
resident provides adequate proof of income or financial aid. These leases
typically correspond to the university's academic year. Midtown Row is comprised
of 240 student housing units with 620 beds, and as of December 31, 2022, it was
100% leased.

We also operate a third-party property management and brokerage business unit. Our brokerage business primarily consists of representations of commercial tenants for their office and retail real estate needs, either for lease transactions or purchase and sale transactions.

Factors that May Impact Future Results of Operations

Rental Income

Growth in rental income will depend on our ability to acquire additional
properties that meet our investment criteria and on filling vacancies and
increasing rents on the properties in our portfolio. The amount of rental income
generated by the properties in our portfolio depends on our ability to renew
expiring leases or re-lease space upon the scheduled or unscheduled termination
of leases, lease currently available space and maintain or increase rental rates
at our properties. Our rental income in future periods could be adversely
affected by local, regional or national economic conditions, an oversupply of or
a reduction in demand for retail space, changes in market rental rates, our
ability to provide adequate services and maintenance at our properties, and
fluctuations in interest rates. In addition, economic downturns affecting our
markets or downturns in our tenants' businesses that impair our ability to renew
or re-lease space and the ability of our tenants to fulfill their lease
commitments to us could adversely affect our ability to maintain or increase
rent and occupancy.

Scheduled Lease Expirations

Our ability to re-lease expiring space at rental rates equal to or greater than
that of current rental rates will impact our results of operations. Our
properties are marketed to smaller tenants that generally desire shorter-term
leases. As of December 31, 2022, approximately 42.0% of our retail portfolio
(based on leased GLA) was leased to tenants occupying less than 10,000 square
feet. In addition, as of December 31, 2022, approximately 9.6% of our GLA was
vacant and approximately 10.2% of our leases (based on total GLA) were
month-to-month or scheduled to expire on or before December 31, 2023. See "Item
1 Business-Our Portfolio-Lease Expirations." Although we maintain ongoing
dialogue with our tenants, we generally raise the issue of renewal at least 12
months prior to lease renewal often providing concessions for early renewal. If
our current tenants do not renew their leases or terminate their leases early,
we may be unable to re-lease the space to new tenants on favorable terms or at
all. Our vacancy trends will be impacted by new properties that we acquire,
which may include properties with higher vacancy where we identified
opportunities to increase occupancy.

Acquisitions

Over the long-term, we intend to grow our portfolio through the acquisition of
additional strategically positioned properties in established and developing
neighborhoods primarily leased to necessity-based tenants that meet the needs of
the surrounding communities in our existing markets, as well as acquiring
properties in new markets that meet our investment criteria, including the
Southeastern United States. We have established relationships with a wide
variety of market participants, including tenants, leasing agents, investment
sales brokers, property owners and lenders, in our target markets and beyond
and, over the long-term, we believe that we will have opportunities to acquire
properties that meet our investment criteria at attractive prices.

General and Administrative Expenses

General and administrative expenses include employee compensation costs, professional fees, consulting and other general administrative expenses. We expect an increase in general and administrative expenses in the future related to stock issuances to

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employees. We expect that our general and administrative expenses will rise in
some measure as our portfolio grows but that such expenses as a percentage of
our revenue will decrease over time due to efficiencies and economies of scale.

Capital Expenditures

We incur capital expenditures at our properties that vary in amount and
frequency based on each property's specific needs. We expect our capital
expenditures will be for recurring maintenance to ensure our properties are in
good working condition, including parking and roof repairs, façade maintenance
and general upkeep. We also will incur capital expenditures related to
repositioning and refurbishing properties where we have identified opportunities
to improve our properties to increase occupancy, and we may incur capital
expenditures related to redevelopment or development consistent with our
business and growth strategies.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with generally accepted
accounting principles ("GAAP") in the United States requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Management considers accounting estimates or
assumptions critical in either of the following cases:

•

the nature of the estimates or assumptions is material because of the levels of subjectivity and judgment needed to account for matters that are highly uncertain and susceptible to change; and

•

the effect of the estimates and assumptions is material to the financial statements.

Management believes the current assumptions used to make estimates in the
preparation of the consolidated financial statements are appropriate and not
likely to change in the future. However, actual experience could differ from the
assumptions used to make estimates, resulting in changes that could have a
material adverse effect on our consolidated results of operations, financial
position and/or liquidity. These estimates will be made and evaluated on an
ongoing basis using information that is available as well as various other
assumptions believed to be reasonable under the circumstances. Management has
discussed the determination and disclosures of these critical accounting
policies with the audit committee of the board of directors.

The following presents information about our critical accounting policies
including the material assumptions used to develop significant estimates.
Certain of these critical accounting policies contain discussion of judgments
and estimates that have not yet been required by management but that it believes
may be reasonably required of it to make in the future. See Note 2 "Accounting
Policies and Related Matters" to the consolidated financial statements for
additional information on significant accounting policies and the effect of
recent accounting pronouncements.

Principles of Consolidation

The consolidated financial statements include the accounts of our wholly owned
subsidiaries, and all material intercompany transactions and balances are
eliminated in consolidation. We consolidate entities in which we own less than
100% of the equity interest but have a controlling interest through a variable
interest, voting rights or other means. For these entities, we record a
noncontrolling interest representing the equity held by other parties.

From inception, we continually evaluate all of our transactions and investments
to determine if they represent variable interests subject to the variable
interest entity ("VIE") consolidation model and then determine which business
enterprise is the primary beneficiary of its operations. We make judgments about
which entities are VIEs based on an assessment of whether (i) the equity
investors as a group, if any, do not have a controlling financial interest or
(ii) the equity investment at risk is insufficient to finance that entity's
activities without additional subordinated financial support. We consolidate
investments in VIEs when we are determined to be the primary beneficiary. This
evaluation is based on our ability to direct and influence the activities of a
VIE that most significantly impact that entity's economic performance.

For investments not subject to the variable interest entity consolidation model,
we will evaluate the type of rights held by the limited partner(s) or other
member(s), which may preclude consolidation in circumstances in which the sole
general partner or managing member would otherwise consolidate the limited
partnership. The assessment of limited partners' or members' rights and their
impact on the presumption of control over a limited partnership or limited
liability corporation by the sole general partner or managing member should be
made when an investor becomes the sole general partner or managing member and
should be reassessed if (i) there is a change to the terms or in the
exercisability of the rights of the limited partners or members, (ii) the sole
general partner or member increases or decreases its ownership in the limited
partnership or corporation or (iii) there is an increase or decrease in the
number of outstanding limited partnership or membership interests.

Our ability to assess correctly our influence or control over an entity at
inception of our involvement or on a continuous basis when determining the
primary beneficiary of a VIE affects the presentation of these entities in our
consolidated financial statements. Subsequent evaluations of the primary
beneficiary of a VIE may require the use of different assumptions that could
lead to identification of a different primary beneficiary, resulting in a
different consolidation conclusion than what was determined at inception of the
arrangement.
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Revenue Recognition

Leases of Real Estate Properties: At the inception of a new lease arrangement,
including new leases that arise from amendments, we assess the terms and
conditions to determine the proper lease classification. Currently, all of our
lease arrangements are classified as operating leases. Rental revenue for
operating leases is recognized on a straight-line basis over the lease term when
collectability is reasonably assured and the tenant has taken possession or
controls the physical use of a leased asset. If we determine that substantially
all future lease payments are not probable of collection, we will account for
these leases on a cash basis. If the lease provides for tenant improvements, we
determine whether the tenant improvements, for accounting purposes, are owned by
the tenant or by us. When we are the owner of the tenant improvements, the
tenant is not considered to have taken physical possession or have control of
the physical leased asset until the tenant improvements are substantially
completed. When the tenant is the owner of the tenant improvements, any tenant
improvement allowance funded is treated as a lease incentive and amortized as a
reduction of revenue over the lease term. The determination of ownership of the
tenant improvements is subject to significant judgment. If our assessment of the
owner of the tenant improvements for accounting purposes were different, the
timing and amount of revenue recognized would be impacted.

A majority of our leases require tenants to make estimated payments to the
Company to cover their proportional share of operating expenses, including, but
not limited to, real estate taxes, property insurance, routine maintenance and
repairs, utilities and property management expenses. We collect these estimated
expenses and are reimbursed by tenants for any actual expense in excess of
estimates or reimburse tenants if collected estimates exceed actual operating
results. The reimbursements are recorded in rental income, and the expenses are
recorded in property operating expenses, as we are generally the primary obligor
with respect to purchasing goods and services from third-party suppliers, have
discretion in selecting the supplier and bear the credit risk.

We assess the probability of collecting substantially all payments under our
leases based on several factors, including, among other things, payment history
of the lessee, the financial strength of the lessee and any guarantors,
historical operations and operating trends and current and future economic
conditions and expectations of performance. If our evaluation of these factors
indicates it is probable that we will be unable to collect substantially all
rents, we recognize a charge to rental income and limit our rental income to the
lesser of lease income on a straight-line basis plus variable rents when they
become accruable or cash collected. If we change our conclusion regarding the
probability of collecting rent payments required by a lessee, we may recognize
an adjustment to rental income in the period we make a change to our prior
conclusion.

Contractual rent increases of renewal options are often fixed at the time of the
initial lease agreement which may result in tenants being able to exercise their
renewal options at amounts that are less than the fair value of the rent at the
date of the renewal. In addition to fixed base rents, certain rental income
derived from our tenant leases is variable and may be dependent on percentage
rent. Variable lease payments from percentage rents are earned by us in the
event the tenant's gross sales exceed certain amounts. Terms of percentage rent
are agreed upon in the tenant's lease and will vary based on the tenant's sales.

Leasing Commissions: We earn leasing commissions as a result of providing
strategic advice and connecting tenants to property owners in the leasing of
retail space. We record commission revenue on real estate leases at the point in
time when the performance obligation is satisfied, which is generally upon lease
execution. Terms and conditions of a commission agreement may include, but are
not limited to, execution of a signed lease agreement and future contingencies,
including tenant's occupancy, payment of a deposit or payment of first month's
rent (or a combination thereof).

Property and Asset Management Fees: We provide real estate management services
for owners of properties, representing a series of daily performance obligations
delivered over time. Pricing is generally in the form of a monthly management
fee based upon a percentage of property-level cash receipts or some other
variable metric.

When accounting for reimbursements of third-party expenses incurred on a
client's behalf, we determine whether we are acting as a principal or an agent
in the arrangement. When we are acting as a principal, our revenue is reported
on a gross basis and comprises the entire amount billed to the client and
reported cost of services includes all expenses associated with the client. When
we are acting as an agent, our fee is reported on a net basis as revenue for
reimbursed amounts is netted against the related expenses.

Engineering Services: We provide engineering services to property owners on an
as needed basis at the properties where we are the property or asset manager. We
receive consideration at agreed upon fixed rates for the time incurred plus a
reimbursement for costs incurred and revenue is recognized over time because the
customer simultaneously receives and consumes the benefits of the services as
they are performed. We account for performance obligations using the right to
invoice practical expedient. We apply the right to invoice practical expedient
to record revenue as the services are provided, given the nature of the services
provided and the frequency of billing under the customer contract. Under this
practical expedient, we recognize revenue in an amount that corresponds directly
with the value to the customer of performance completed to date and for which
there is a right to invoice the customer.

Real Estate Investments

We evaluate each purchase transaction to determine whether the acquired assets
and liabilities assumed meet the definition of a business and make estimates as
part of our allocation of the purchase prices. For acquisitions accounted for as
asset acquisitions, the purchase price, including transaction costs, is
allocated to the various components of the acquisition based upon the relative
fair value of each component. For acquisitions accounted for as business
combinations, the purchase price is allocated at fair value of each component
and transaction costs are expensed as incurred.
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We assess the fair value of acquired assets and acquired liabilities in
accordance with the ASC Topic 805 Business Combinations and allocate the
purchase price based on these assessments. We assess fair value based on
estimated cash flow projections that utilize appropriate discount and
capitalization rates and available market information. Estimates of future cash
flows are based on a number of factors including the historical operating
results, known trends, and market and economic conditions that may affect the
property. The most significant components of our allocations are typically the
allocation of fair value to land and buildings and in-place leases and other
intangible assets. The estimates of the fair value of buildings will affect the
amount of depreciation and amortization we record over the estimated useful life
of the property acquired.

For any value assigned to in-place leases and other intangibles, including the
assessment as to the existence of any above-or below-market leases, management
makes its best estimates based on the evaluation of the specific characteristics
of each tenant's lease. Factors considered include estimates of carrying costs
during hypothetical expected lease-up periods, market conditions and costs to
execute similar leases. These assumptions affect the amount of future revenue
that we will recognize over the remaining lease term for the acquired in-place
leases. The values of any identified above-or below-market leases are based on
the present value of the difference between (i) the contractual amounts to be
paid pursuant to the in-place leases and (ii) management's estimate of fair
market lease rates for the corresponding in-place leases, measured over a period
equal to the remaining non-cancelable term of the lease, or for below-market
leases including any bargain renewal option terms. Above-market lease values are
recorded as a reduction of rental income over the lease term while below-market
lease values are recorded as an increase to rental income over the lease term.
The recorded values of in-place lease intangibles are recognized in amortization
expense over the initial term of the respective leases.

Transaction costs related to asset acquisitions are included in the cost basis
of the acquired assets, while transaction costs related to acquisitions that are
deemed business combinations are expensed as incurred.

Asset Impairment

Real estate asset impairment losses are recorded when events or changes in
circumstances indicate the asset is impaired and the estimated undiscounted cash
flows to be generated by the asset are less than its carrying amount. Management
assesses if there are triggering events including macroeconomic conditions, loss
of an anchor tenant and the ability to re-tenant the space, significant and
persistent delinquencies, unanticipated decreases in or sustained reductions of
net operating income and government-mandated compliance with an adverse effect
to the Company's cost basis or operating costs. If management concludes there
are triggering events, we then assess the impairment of properties individually.
Management analyzes recoverability based on the estimated undiscounted future
cash flows expected to be generated from the operations and eventual disposition
of the property. If the analysis indicates that the carrying value of a property
is not recoverable from its estimated undiscounted future cash flows, an
impairment loss is recognized. Impairment losses are calculated as the excess of
the carrying amount over the fair value of assets to be held and used, and
carrying amount over the fair value less cost to sell in instances where
management has determined that we will dispose of the property. In determining
fair value, we use current appraisals or other third-party opinions of value and
other estimates of fair value such as estimated discounted future cash flows.
The determination of future cash flows requires significant estimates by
management. In management's estimate of cash flows, it considers factors such as
expected future sale of an asset, capitalization rates, holding periods and the
undiscounted future cash flow analysis. Subsequent changes in estimated cash
flows could affect the determination of whether an impairment exists.

Income Taxes

We account for deferred income taxes using the asset and liability method and
recognize deferred tax assets and liabilities for the expected future tax
consequences of events that have been included in our financial statements or
tax returns. Under this method, we determine deferred tax assets and liabilities
based on the differences between the financial reporting and tax basis of assets
and liabilities using enacted tax rates in effect for the year in which the
differences are expected to reverse. Any increase or decrease in the deferred
tax liability that results from a change in circumstances, and that causes us to
change our judgment about expected future tax consequences of events, is
included in the tax provision when such changes occur. Deferred income taxes
also reflect the impact of operating loss and tax credit carryforwards. A
valuation allowance is provided if we believe it is more likely than not that
all or some portion of the deferred tax asset will not be realized. Any increase
or decrease in the valuation allowance that results from a change in
circumstances, and that causes us to change our judgment about the realizability
of the related deferred tax asset, is included in the tax provision when such
changes occur.

We recognize a tax benefit from an uncertain tax position only if it is more
likely than not that the tax position will be sustained on examination by the
taxing authorities. The determination is based on the technical merits of the
position and presumes that each uncertain tax position will be examined by the
relevant taxing authority that has full knowledge of all relevant information.
The estimate of our tax liabilities relating to uncertain tax positions requires
management to assess uncertainties and to make judgments about the application
of complex tax laws and regulations. We recognize interest and penalties
associated with uncertain tax positions as part of income tax expense.

Recently Issued Accounting Standards

See Note 2 "Accounting Policies and Related Matters" in the notes to the consolidated financial statements for information concerning recently issued accounting standards.

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Results of Operations

This section provides a comparative discussion on our results of operations and should be read in conjunction with our consolidated financial statements, including the accompanying notes. See "Critical Accounting Policies and Estimates" for more information concerning the most significant accounting policies and estimates applied in determining our results of operations.

Comparison of the year ended December 31, 2022 to the year ended December 31,
2021


                                            For the year ended December
                                                        31,                        Change
(dollars in thousands)                         2022             2021            $            %
Revenues
Rental income                               $   29,871       $   21,408     $   8,463          40 %
Commissions                                      2,523            2,836          (313 )       (11 %)
Management and other income                        557            1,105          (548 )       (50 %)
Total revenues                                  32,951           25,349         7,602          30 %
Expenses
Cost of services                                 1,917            1,824            93           5 %
Depreciation and amortization                   17,436           12,501         4,935          39 %
Property operating                               8,672            5,694         2,978          52 %
Bad debt expense                                   235               34           201         591 %
General and administrative                      13,513           11,360         2,153          19 %
Total operating expenses                        41,773           31,413        10,360          33 %
Operating loss                                  (8,822 )         (6,064 )      (2,758 )        45 %

Other income (expense)
Net interest and other income (expense)             26              (33 )          59        (179 %)
Derivative fair value adjustment                 2,638              353         2,285        (647 %)
Net loss on fair value change on debt
held under the fair value option                (3,151 )              -        (3,151 )       N/A
Interest expense                               (12,710 )         (9,961 )      (2,749 )        28 %
(Loss) gain on extinguishment of debt              (59 )          1,528        (1,587 )      (104 %)
Other expense                                      (52 )           (100 )          48         (48 %)
Total other expense                            (13,308 )         (8,213 )      (5,095 )        62 %

Income tax benefit                               5,857            3,533         2,324          66 %
Net loss                                    $  (16,273 )     $  (10,744 )   $  (5,529 )        51 %
Less: Preferred equity return on Fortress
preferred equity                                (1,492 )              -        (1,492 )       N/A
Less: Preferred OP units return                    (48 )              -           (48 )       N/A
Plus: Net loss attributable to
noncontrolling interest                          2,522            1,236         1,286         104 %
Net loss attributable to common
stockholders                                $  (15,291 )     $   (9,508 )

$ (5,783 ) 61 %

Revenues for the year ended December 31, 2022 increased approximately $7.6
million, or 30%, compared to the year ended December 31, 2021, as a result of an
approximately $8.5 million increase in rental income that was partially offset
by an approximately $0.5 million decrease in management and other income and
$0.3 million decrease in commissions. Rental income increased as a result of the
impact of a full year of results from the acquisition of three properties in the
second quarter and one property in the fourth quarter of 2021 and the
acquisition of two properties in the fourth quarter of 2022. The decrease in
management and other fees is mainly attributable to approximately $0.3 million
of fees recognized in 2021 related to the properties acquired by the Company
during 2021 and 2022. The decrease in commissions is mainly attributable to a
lower transaction volume of leasing.

Total operating expenses for the year ended December 31, 2022 increased
approximately $10.4 million, or 33%, compared to the year ended December 31,
2021, primarily from: (i) an increase in depreciation and amortization expense
of approximately $4.9 million which is primarily related to six properties that
were acquired during 2022 and 2021 (which comprise $5.3 million of the total
increase in depreciation and amortization expense, partially offset by a $0.5
million decrease in amortization of in-place lease tangibles); (ii) an increase
in property operating expenses of $3.0 million which is primarily related to the
six properties acquired in 2022 and 2021 and (iii) an increase in general and
administrative expenses of approximately $2.2 million mainly attributable to an
increase in stock compensation expense of approximately $1.3 million, an
increase in professional service fees of approximately $0.4 million, an increase
in payroll and related expenses of approximately $0.2 million and an increase in
board of director fees of approximately $0.2 million.

The gain on derivative fair value adjustment was approximately $2.6 million for
the year ended December 31, 2022 compared to $0.4 million for the year ended
December 31, 2021. The increase of approximately $2.3 million was primarily due
to a $3.1 million change in fair value of the interest rate swaps the Company
entered into on July 1, 2021 and December 27, 2019, partially offset by a $0.8
million change in fair value of the embedded derivative liability relating to
the Preferred Equity Investment.
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Net loss on fair value change on debt held under the fair value option reflects
the change in fair value of the Fortress Mezzanine Loan for which we elected the
fair value option.

Interest expense for the year ended December 31, 2022 increased approximately
$2.7 million, or 28%, compared to the year ended December 31, 2021, primarily
due to debt that was assumed or originated in connection with six properties
that were acquired during 2022 and 2021 and additional net borrowings of
approximately $71.6 million during 2022.

The gain on extinguishment of debt of approximately $1.5 million for the year
ended December 31, 2021 is related to the forgiveness of unsecured loans
totaling approximately $1.5 million granted pursuant to the Paycheck Protection
Program (the "PPP Program"), which was established under the Coronavirus Aid,
Relief, and Economic Security Act.

Income tax benefit increased approximately $2.3 million over the prior year, which is attributable to the properties generating additional tax losses of approximately $6.8 million compared to the prior year.

Preferred equity return on Fortress preferred equity reflects the portion of the
distribution to the Fortress Member that is payable in cash and the portion that
is accrued and added to the Preferred Equity Investment.

Preferred OP units return reflects the portion of the distribution to holders of
the Preferred OP units that are payable in cash and the portion that are accrued
and added to the liquidation preference of the Preferred OP units.

Net loss attributable to noncontrolling interest for the year ended December 31,
2022 increased approximately $1.3 million compared to the year ended December
31, 2021. The net loss attributable to noncontrolling interest reflects the
proportionate share of the OP units held by outside investors in the operating
results of the Operating Partnership from the completion of the Mergers and the
acquisition of Midtown Row.

Non-GAAP Performance Measures

We present the non-GAAP performance measures set forth below. These measures
should not be considered as an alternative to, or more meaningful than, net
income (calculated in accordance with GAAP) or other GAAP financial measures, as
an indicator of financial performance and are not alternatives to, or more
meaningful than, cash flow from operating activities (calculated in accordance
with GAAP) as a measure of liquidity. Non-GAAP performance measures have
limitations as they do not include all items of income and expense that affect
operations, and accordingly, should always be considered as supplemental
financial results to those calculated in accordance with GAAP. Our computation
of these non-GAAP performance measures may differ in certain respects from the
methodology utilized by other real estate companies and, therefore, may not be
comparable to similarly titled measures presented by other real estate
companies. Investors are cautioned that items excluded from these non-GAAP
performance measures are relevant to understanding and addressing financial
performance.

Funds From Operations and Adjusted Funds from Operations

Funds from operations ("FFO") is a supplemental non-GAAP financial measure of
real estate companies' operating performance. The National Association of Real
Estate Investment Trusts ("Nareit") defines FFO as follows: net income (loss),
computed in accordance with GAAP, excluding (i) depreciation and amortization
related to real estate, (ii) gains and losses from the sale of certain real
estate assets, (iii) gains and losses from change in control, (iv) impairment
write-downs of certain real estate assets and investments in entities when the
impairment is directly attributable to decreases in the value of depreciable
real estate held by the entity and (v) after adjustments for unconsolidated
partnerships and joint ventures calculated to reflect FFO on the same basis.

Historical cost accounting for real estate assets in accordance with GAAP
implicitly assumes that the value of real estate assets diminishes predictably
over time. Since real estate values instead have historically risen or fallen
with market conditions, many industry investors and analysts have considered the
presentation of operating results for real estate companies that use historical
cost accounting to be insufficient by themselves. Considering the nature of our
business as a real estate owner and operator, we believe that FFO is useful to
investors in measuring our operating and financial performance because the
definition excludes items included in net income that do not relate to or are
not indicative of our operating and financial performance, such as depreciation
and amortization related to real estate, and items which can make periodic and
peer analysis of operating and financial performance more difficult, such as
gains and losses from the sale of certain real estate assets and impairment
write-downs of certain real estate assets. Specifically, in excluding real
estate related depreciation and amortization and gains and losses from sales of
depreciable operating properties, which do not relate to or are not indicative
of operating performance, FFO provides a performance measure that, when compared
year over year, captures trends in occupancy rates, rental rates and operating
costs.

However, because FFO excludes depreciation and amortization and captures neither
the changes in the value of our properties that result from use or market
conditions nor the level of capital expenditures and leasing commissions
necessary to maintain the operating performance of our properties, all of which
have real economic effects and could materially impact our results from
operations, the utility of FFO as a measure of our performance is limited.
Accordingly, FFO should be considered only as a supplement to net income as a
measure of our performance. FFO should not be used as a measure of our
liquidity, nor is it indicative of funds available to fund our cash needs,
including our ability to pay dividends or service indebtedness. Also, FFO should
not be used as a supplement to or substitute for cash flow from operating
activities computed in accordance with GAAP.

                                       45
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Adjusted FFO ("AFFO") is calculated by excluding the effect of certain items
that do not reflect ongoing property operations, including stock-based
compensation expense, deferred financing and debt issuance cost amortization,
non-real estate depreciation and amortization, straight-line rent, non-cash
interest expense and other non-comparable or non-operating items. Management
considers AFFO a useful supplemental performance metric for investors as it is
more indicative of the Company's operational performance than FFO.

AFFO is not intended to represent cash flow or liquidity for the period and is
only intended to provide an additional measure of our operating performance. We
believe that Net income/(loss) is the most directly comparable GAAP financial
measure to AFFO. Management believes that AFFO is a widely recognized measure of
the operations of real estate companies, and presenting AFFO enables investors
to assess our performance in comparison to other real estate companies. AFFO
should not be considered as an alternative to net income/(loss) (determined in
accordance with GAAP) as an indication of financial performance, or as an
alternative to cash flow from operating activities (determined in accordance
with GAAP) as a measure of our liquidity, nor is it indicative of funds
available to fund our cash needs, including our ability to make distributions.

Our reconciliation of net income (loss) to FFO and AFFO for the years ended December 31, 2022, and 2021 is as follows:

                                                      For the Year Ended December 31,
(dollars in thousands)                                  2022                   2021
Net loss                                          $        (16,273 )     $        (10,744 )
Real estate depreciation and amortization                   17,259          

12,462

Amortization of direct leasing costs                            44                      8
FFO attributable to common shares and OP units               1,030          

1,726

Stock-based compensation expense                             1,937          

643

Deferred financing and debt issuance cost
amortization                                                 1,512          

1,302

Intangibles amortization                                      (387 )                 (448 )
Non-real estate depreciation and amortization                  131                     19
Non-cash interest expense                                      253                      -
Recurring capital expenditures                                (981 )                 (280 )
Straight-line rent revenue                                    (945 )                 (512 )
Minimum return on preferred interests                       (1,112 )                 (335 )
Non cash fair value adjustment                                 513                   (353 )
AFFO attributable to common shares and OP units   $          1,951       $  

1,762

Weighted average shares outstanding to common
shares
Diluted                                                 32,378,526          

26,928,510

Net loss attributable to common stockholders
per share
Diluted (1)                                       $          (0.47 )     $  

(0.35 )

Weighted average shares outstanding to common
shares and OP units
Diluted                                                 35,412,984          

29,747,324

FFO per common share and OP unit
Diluted (2)                                       $           0.03       $           0.06



(1)
The weighted average common shares outstanding used to compute net loss per
diluted common share only includes the common shares. We have excluded the OP
units since the conversion of OP units is anti-dilutive in the computation of
diluted EPS for the periods presented.
(2)
The weighted average common shares outstanding used to compute FFO per diluted
common share includes OP units that were excluded from the computation of
diluted EPS. Conversion of these OP units is dilutive in the computation of FFO
per diluted common share but is anti-dilutive for the computation of diluted EPS
for the periods presented.

Liquidity and Capital Resources

Overview

Liquidity is a measure of our ability to meet potential cash requirements, including ongoing commitments to repay any outstanding borrowings, fund and maintain our assets and operations and other general business needs.

Our short-term liquidity requirements consist primarily of debt service
requirements, operating expenses, recurring capital expenditures (such as
repairs and maintenance of our properties), non-recurring capital expenditures
(such as capital improvements and tenant improvements) and distributions on our
Preferred OP units. Except as noted below, we expect to meet our short-term
liquidity

                                       46
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requirements through cash on hand and cash reserves and additional secured and
unsecured debt. As of December 31, 2022 and April 6, 2023, we had unrestricted
cash and cash equivalents of approximately $12.4 million and $7.8 million,
respectively, available for current liquidity needs and restricted cash of
approximately $4.7 million and $5.6 million, respectively, which is available
for debt service shortfall requirements, certain capital expenditures, real
estate taxes and insurance.

We have three mortgage loans on three properties (Highlandtown Shopping Center,
Vista Shops at Golden Mile and Spotswood Valley Square Shopping Center) totaling
approximately $28.6 million that mature within the next twelve months. We
project that we will not have sufficient cash available to pay off the mortgage
loans upon maturity, and we are currently seeking to refinance the loans prior
to maturity in May 2023, June 2023 and July 2023. There can be no assurances
that we will be successful on the refinance of the mortgage loans on favorable
terms or at all. If we are unable to refinance the mortgage loans, the lenders
have the right to place the loans in default and ultimately foreclose on the
properties. Under this circumstance, we would not have any further financial
obligation to the lenders as the value of these properties are in excess of the
outstanding loan balances.

The Lamont Street Preferred Interest has an outstanding balance of $4.2 million
as of December 31, 2022 and must be redeemed on or before September 30, 2023.
The Lamont Street Redemption Date can be extended by us to September 30, 2024
and September 30, 2025, in each case subject to certain conditions and approval
by Lamont Street. There can be no assurance that we will be successful in
exercising these extension options or refinancing the Lamont Street Preferred
Interest prior to the Lamont Street Redemption Date. If we are unable to extend
or refinance the Lamont Street Preferred Interest prior to the redemption date,
Lamont Street may remove the Operating Partnership as the manager of BSV
Highlandtown and BSV Spotswood.

In addition, the Basis Term Loan has an outstanding balance of approximately
$66.9 million and matures on January 1, 2024, subject to the remaining one-year
extension option that is subject to certain conditions and approval by the
lender. Management is in discussions with other lenders to refinance the Basis
Term Loan, which management believes will be available on acceptable terms based
on discussions with lenders and the loan-to-value ratios of the properties
securing the Basis Term Loan. There can be no assurances, however, that we will
be successful in exercising the extension option or refinancing the Basis Term
Loan prior to its maturity. If we are unable to extend or refinance the Basis
Term Loan prior to maturity, the lender will have the right to place the loan in
default and ultimately foreclose on the six properties securing the loan.

If we fail to refinance the Basis Term Loan and the mortgage loans secured by
Highlandtown Shopping Center and Spotswood Valley Square Shopping Center, redeem
the Lamont Street Preferred Interest and contribute the applicable properties by
the applicable outside dates (as described below), it would be considered a
Trigger Event under the Eagles Sub-OP Operating Agreement. See "-Fortress
Preferred Equity Investment" below.

Although management believes that we will be able to extend or refinance our
debt prior to maturity, including the Basis Term Loan and the Lamont Street
Preferred Interest, this is not within our sole control and it is possible that
we may be unable to extend or refinance such debt, which creates substantial
doubt about our ability to continue as a going concern for a period of one year
after the date that the financial statements included in this report are issued,
and our independent registered public accounting firm has included an
explanatory paragraph regarding our ability to continue as a going concern in
its report on our financial statements included in this report. The financial
statements included in this report have been prepared assuming that the Company
will continue as a going concern and do not include any adjustments that might
result from the outcome of this uncertainty.

Our long-term liquidity requirements are expected to consist primarily of funds
necessary for the repayment of debt at or prior to maturity, capital
improvements, development and/or redevelopment of properties and property
acquisitions. We expect to meet our long-term liquidity requirements through net
cash from operations, additional secured and unsecured debt and, subject to
market conditions, the issuance of additional shares of common stock, preferred
stock or OP units.

Our access to capital depends upon a number of factors over which we have little
or no control, including general market conditions, the market's perception of
our current and potential future earnings and cash distributions, our current
debt levels and the market price of the shares of our common stock. Although our
common stock is quoted on the OTCQX, there is a very limited trading market for
our common stock, and if a more active trading market is not developed and
sustained, we will be limited in our ability to issue equity to fund our capital
needs. If we cannot obtain capital from third-party sources, we may not be able
to meet the capital and operating needs of our properties, satisfy our debt
service obligations or pay dividends to our stockholders. Until we have greater
access to capital, we will likely structure future acquisitions through joint
ventures or other syndicated structures in which outside investors will
contribute a majority of the capital and we will manage the assets.

As described below, under our existing debt agreements, we are subject to
continuing covenants. As of December 31, 2022, we were in compliance with all of
the covenants under our debt agreements. In the event of a default, the lenders
could accelerate the timing of payments under the applicable debt obligations
and we may be required to repay such debt with capital from other sources, which
may not be available on attractive terms, or at all, which would have a material
adverse effect on our liquidity, financial condition and results of operations.
                                       47
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Consolidated Indebtedness and Preferred Equity

Indebtedness Summary

The following table sets forth certain information regarding our outstanding indebtedness as of December 31, 2022:

                                                                                     Balance
                                                                                  Outstanding at
                                   Maturity                         Interest       December 31,
(dollars in thousands)               Date           Rate Type       Rate (1)           2022
Basis Term Loan (net of           January 1,
discount of $79)                     2024         Floating (2)       6.125%  (3) $         67,086
Hollinswood Shopping Center       December 1,
Loan                                 2024       LIBOR + 2.25% (4)    4.06%                 12,760
                                    June 1,
Avondale Shops Loan                  2025             Fixed          4.00%                  2,985
Vista Shops at Golden Mile Loan    June 24,
(net of discount of $12)             2023             Fixed          3.83%                 11,478
Brookhill Azalea Shopping         January 31,
Center Loan                          2025         LIBOR + 2.75%      7.14%                  8,762
Lamar Station Plaza West Loan      December
(net of discount of $95)           10, 2027           Fixed          5.67%                 18,317
Lamont Street Preferred
Interest (net of discount of       September
$29) (5)                           30, 2023           Fixed          13.50%                 4,241
Highlandtown Village Shopping
Center Loan (net of discount of
$14)                              May 6, 2023         Fixed          4.13%                  5,241
                                   December
Cromwell Field Shopping Center     22, 2027
Loan (net of discount of $77)         (6)           Fixed (7)        6.71%                 10,113
Midtown Row Loan (net of          December 1,
discount of $25)                     2027             Fixed          6.48%                 75,975
                                  December 1,
Midtown Row Mezzanine Loan           2027             Fixed          12.00%                17,895   (8)
Spotswood Valley Square
Shopping Center Loan (net of        July 6,
discount of $31)                     2023             Fixed          4.82%                 11,849
The Shops at Greenwood Village    October 10,
Loan (net of discount of $94)        2028       Prime - 0.35% (9)    4.08%                 22,772
                                                                                          269,474
Unamortized deferred financing
costs, net                                                                                 (1,858 )
Total                                                                            $        267,616


_____________________

(1)

At December 31, 2022, the floating rate loans tied to LIBOR were based on the one-month LIBOR rate of 4.39%.

(2)

The interest rate for the Basis Term Loan is the greater of (i) SOFR plus 3.97%
per annum and (ii) 6.125% per annum. On August 1, 2022, the interest rate cap
that capped the prior-LIBOR rate was modified to cap the SOFR rate on this loan
at 3.5%. This interest rate cap matured on January 1, 2023. On November 23,
2022, we entered into an interest rate cap agreement, effective January 1, 2023,
to cap the SOFR interest rate at 4.65%.

(3)

The outstanding balance includes $0.3 million of exit fees as of December 31, 2022.

(4)

The Company has entered into an interest rate swap which fixes the interest rate of the loan at 4.06%.

(5)

The outstanding balance includes approximately $0.3 million of indebtedness as
of December 31, 2022, related to the Lamont Street Minimum Multiple Amount (as
defined below) owed to Lamont Street as described below under the heading
"-Lamont Street Preferred Interest."

(6)

On November 9, 2022, the Company entered into a modification to the Cromwell
Field Shopping Center mortgage loan to extend the maturity date to December 31,
2022. In December 2022, the Company refinanced the Cromwell Field Shopping
Center mortgage.

(7)

Prior to the refinancing of the Cromwell Field Shopping Center mortgage loan in
December 2022, the interest rate on the loan was LIBOR plus 5.40% per annum with
a minimum LIBOR rate of 0.50%.

(8)

The outstanding balance reflects the fair value of the debt.

(9)

The Company entered into an interest rate swap which fixes the interest rate of the loan at 4.082%.

                                       48
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The following table sets forth our scheduled principal repayments and maturities during each of the next five years and thereafter as of December 31, 2022:

(dollars in thousands)

                          Amount        Percentage
Year (1)                    Due          of Total
2023                     $  34,318             12.8 %
2024                        81,129             30.4 %
2025                        11,910              4.4 %
2026                         2,063              0.8 %
2027                       117,960             44.2 %
Thereafter                  19,772              7.4 %
                         $ 267,152            100.0 %

_____________________

(1)

Does not reflect the exercise of any maturity extension options.

Basis Term Loan

In December 2019, six of our subsidiaries, as borrowers (collectively, the
"Borrowers"), and Big Real Estate Finance I, LLC, a subsidiary of a real estate
fund managed by Basis Management Group, LLC ("Basis"), as lender (the "Basis
Lender"), entered into a loan agreement (the "Basis Loan Agreement") pursuant to
which the Basis Lender made a senior secured term loan of up to $66.9 million
(the "Basis Term Loan") to the Borrowers. Pursuant to the Basis Loan Agreement,
the Basis Term Loan is secured by mortgages on the following properties: Coral
Hills, Crestview, Dekalb, Midtown Colonial, Midtown Lamonticello and West Broad.
The Basis Term Loan initial maturity was January 1, 2023, subject to two
one-year extension options, subject to certain conditions. The Company exercised
one of the one-year extension options and the maturity date was extended to
January 1, 2024. On June 29, 2022, the Basis Loan Agreement was amended and
restated to replace LIBOR with SOFR. The Basis Term Loan bears interest at a
rate equal to the greater of (i) SOFR plus 3.97% per annum and (ii) 6.125% per
annum. The Borrowers had entered into an interest rate cap that effectively
capped the prior-LIBOR rate at 3.50% per annum. On August 1, 2022, the interest
rate cap was modified to cap the SOFR rate at 3.50%. The interest rate cap
matured on January 1, 2023. On November 23, 2022, we entered into an interest
rate cap agreement, effective January 1, 2023, to cap the SOFR interest rate at
4.65%. As of December 31, 2022, the interest rate of the Basis Term Loan was
6.125% and the outstanding balance was $66.9 million.

Certain of the Borrowers' obligations under the Basis Loan Agreement are
guaranteed by the Company and by Michael Z. Jacoby, the Company's chairman and
chief executive officer, and Thomas M. Yockey, a director of the Company. The
Company has agreed to indemnify Mr. Yockey for any losses he incurs as a result
of his guarantee of the Basis Term Loan.

The Basis Loan Agreement contains certain customary representations and
warranties and affirmative negative and restrictive covenants, including certain
property related covenants for the properties securing the Basis Term Loan,
including a requirement that certain capital improvements be made. The Basis
Lender has certain approval rights over amendments or renewals of material
leases (as defined in the Basis Loan Agreement) and property management
agreements for the properties securing the Basis Term Loan.

If (i) an event of default exists, (ii) the Company's subsidiary serving as the
property manager ("BSR") or any other subsidiary of the Company serving as
property manager for one of the secured parties becomes bankrupt, insolvent or a
debtor in an insolvency proceeding, or there is a change of control of BSR or
such other subsidiary without approval by the Basis Lender, (iii) a default
occurs under the applicable management agreement, or (iv) the property manager
has engaged in fraud, willful misconduct, misappropriation of funds or is
grossly negligent with regard to the applicable property, the Basis Lender may
require a Borrower to replace BSR or such other subsidiary of the Company as the
property manager and hire a third party manager approved by the Basis Lender to
manage the applicable property.

The Borrowers are generally prohibited from selling the properties securing the
Basis Term Loan and the Company is prohibited from transferring any interest in
any of the Borrowers, in each case without consent from the Basis Lender. The
Company is prohibited from engaging in transactions that would result in a
Change in Control (as defined in the Basis Loan Agreement) of the Company. Under
the Basis Loan Agreement, among other things, it is deemed a Change in Control
if Michael Z. Jacoby ceases to be the chairman and chief executive officer of
the Company and actively involved in the daily activities and operations of the
Company and the Borrowers and a competent and experienced person is not approved
by the Basis Lender to replace Mr. Jacoby within 90 days of him ceasing to serve
in such roles.

The Basis Loan Agreement provides for standard events of default, including
nonpayment of principal and other amounts when due, non-performance of
covenants, breach of representations and warranties, certain bankruptcy or
insolvency events and changes in control. If an event of default occurs and is
continuing under the Basis Loan Agreement, the Basis Lender may, among other
things, require the immediate payment of all amounts owed thereunder.

In addition, if there is a default by Mr. Jacoby under a certain personal loan
as long as he has pledged OP units as collateral for such loan, and such default
has not been waived or cured, then the Basis Lender will have the right to sweep
the Borrowers' cash account
                                       49
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in which they collect and retain rental payments from the properties securing
the Basis Term Loan on a daily basis in order for the Basis Lender to create a
cash reserve that will serve as collateral for the Basis Term Loan.

The Basis Loan Agreement includes a debt service coverage calculation based on
the trailing twelve month's results which includes an adjustment for tenants
that are more than one-month delinquent in paying rent. A debt service coverage
ratio below 1.10x is a Cash Trap Trigger Event (as defined in the Basis Loan
Agreement), which gives the Basis Lender the right to institute a cash
management period until the trigger is cured. A debt service coverage ratio
below 1.05x for two consecutive calendar quarters gives the Basis Lender the
right to remove the Company as manager of the properties. The debt service
coverage calculation for the twelve months ended December 31, 2022, was
approximately 1.44x.

Basis Preferred Interest

In December 2019, the Operating Partnership and Big BSP Investments, LLC, a
subsidiary of a real estate fund managed by Basis (the "Preferred Investor"),
entered into an amended and restated operating agreement (the "Sub-OP Operating
Agreement") of Broad Street BIG First OP, LLC a subsidiary of the Operating
Partnership (the "Sub-OP"). Pursuant to the Sub-OP Operating Agreement, among
other things, the Preferred Investor committed to make an investment of up to
$10.7 million in the Sub-OP, of which $6.9 million had been funded, in exchange
for a 1.0% membership interest in the Sub-OP designated as Class A units (the
"Basis Preferred Interest"). On November 23, 2022, the Company redeemed the
Basis Preferred Interest in full for approximately $8.5 million with a portion
of proceeds from the Preferred Equity Investment.

MVB Loans

In December 2019, the Company, the Operating Partnership and BSR entered into a
loan agreement (the "MVB Loan Agreement") with MVB Bank, Inc. ("MVB") with
respect to a $6.5 million loan consisting of a $4.5 million term loan (the "MVB
Term Loan") and a $2.0 million revolving credit facility (the "MVB Revolver").
The MVB Term Loan had a maturity date of December 27, 2022 and the MVB Revolver
had an original maturity date of December 27, 2020, which was extended to June
27, 2023. On March 22, 2022, we entered into agreements (the "MVB Amendments")
that provided for a $2.0 million term loan (the "Second MVB Term Loan"). The
Second MVB Term Loan had a maturity date of June 27, 2023. On November 23, 2022,
the MVB Term Loan, the Second MVB Term Loan and the MVB Revolver were fully
repaid for approximately $6.8 million with a portion of the proceeds from the
Preferred Equity Investment.

Lamont Street Preferred Interest

In connection with the closing of the Highlandtown and Spotswood Mergers on May
21, 2021 and June 4, 2021, respectively, Lamont Street contributed an aggregate
of $3.9 million in exchange for a 1.0% preferred membership interest (the
"Lamont Street Preferred Interest") in BSV Highlandtown Investors LLC ("BSV
Highlandtown") and BSV Spotswood Investors LLC ("BSV Spotswood") designated as
Class A units.

Lamont Street is entitled to a cumulative annual return of 13.5% (the "Lamont
Street Class A Return"), of which 10.0% is paid current and 3.5% is accrued.
Lamont Street's interests are to be redeemed on or before September 30, 2023
(the "Lamont Street Redemption Date"). The Lamont Street Redemption Date may be
extended by us to September 30, 2024 and September 30, 2025, in each case
subject to certain conditions, including the payment of a fee equal to 0.25% of
Lamont Street's net invested capital for the first extension option and a fee of
0.50% of Lamont Street's net invested capital for the second extension option.
If the redemption price is paid on or before the Lamont Street Redemption Date,
then the redemption price will be equal to (a) all unreturned capital
contributions made by Lamont Street, (b) all accrued but unpaid Lamont Street
Class A Return and (c) all costs and other expenses incurred by Lamont Street in
connection with the enforcement of its rights under the agreements.
Additionally, at the Lamont Street Redemption Date, Lamont Street is entitled to
(i) a redemption fee of 0.50% of the capital contributions returned and (ii) an
amount equal to (a) the product of (i) the aggregate amount of capital
contributions made and (ii) 0.26 less (b) the aggregate amount of Lamont Street
Class A Return payments made to Lamont Street (the "Lamont Street Minimum
Multiple Amount"). The Lamont Street Minimum Multiple Amount of approximately
$1.0 million was recorded as interest expense in the consolidated statement of
operations during the second quarter of 2021. As of December 31, 2022, the
remaining Lamont Street Minimum Multiple Amount was approximately $0.3 million.

Our Operating Partnership serves as the managing member of BSV Highlandtown and
BSV Spotswood. However, Lamont Street has approval rights over certain major
decisions, including, but not limited to (i) the incurrence of new indebtedness
or modification of existing indebtedness by BSV Highlandtown and BSV Spotswood,
or their direct or indirect subsidiaries, (ii) capital expenditures over
$100,000, (iii) any proposed change to a property directly or indirectly owned
by BSV Highlandtown and BSV Spotswood, (iv) direct or indirect acquisitions of
new properties by BSV Highlandtown or BSV Spotswood, (v) the sale or other
disposition of any property directly or indirectly owned by BSV Highlandtown or
BSV Spotswood, (vi) the issuance of additional membership interests in BSV
Highlandtown and BSV Spotswood, (vii) any amendment to an existing material
lease related to the properties and (viii) decisions regarding the dissolution,
winding up or liquidation of BSV Highlandtown or BSV Spotswood or the filing of
any bankruptcy petition by BSV Highlandtown and BSV Spotswood or their
subsidiaries.

Under certain circumstances, including an event whereby Lamont Street's
interests are not redeemed on or prior to the Lamont Street Redemption Date (as
it may be extended), Lamont Street may remove our Operating Partnership as the
manager of BSV Highlandtown and BSV Spotswood.
                                       50
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Other Mortgage Indebtedness

As of December 31, 2022 and 2021, we had approximately $180.3 million and $94.9
million, respectively, of outstanding mortgage indebtedness secured by
individual properties. The Hollinswood mortgage, Vista Shops mortgage, Brookhill
mortgage, Highlandtown mortgage, Cromwell mortgage, Spotswood mortgage,
Greenwood Village mortgage, Lamar Station Plaza West mortgage and the Midtown
Row mortgage require the Company to maintain a debt service coverage ratio (as
such terms are defined in the respective loan agreements) as follows in the
table below.


                                          Minimum Debt Service Coverage
Hollinswood Shopping Center                                1.40 to 1.00
Vista Shops at Golden Mile                                 1.50 to 1.00
Brookhill Azalea Shopping Center                           1.30 to 1.00
Highlandtown Village Shopping Center                       1.25 to 1.00
Cromwell Field Shopping Center (1)                         1.20 to 1.00
Lamar Station Plaza West (2)                               1.30 to 1.00
Midtown Row (2)                                            1.15 to 1.00
Spotswood Valley Square Shopping Center                    1.15 to 1.00
The Shops at Greenwood Village                             1.40 to 1.00

(1)

The debt service coverage ratio testing will commence December 31, 2023 with the
following requirements: (i) 1.20 to 1.00 as of December 31, 2023; (ii) 1.55 to
1.00 as of December 31, 2024 and (iii) 1.35 to 1.00 as of December 31, 2025 and
for the remaining term of the loan.

(2)

We were not required to perform the debt service coverage ratio at December 31, 2022.

In connection with the closing of the Midtown Row acquisition in November 2022,
we entered into a $76.0 million mortgage loan secured by the property, which
bears interest of 6.48% and matures on December 1, 2027. Until December 1, 2025,
payments made on the loan will be interest-only.

In December 2022, we refinanced the Lamar Station Plaza West mortgage loan. The
new loan has a principal capacity of $19.0 million, of which $18.4 million was
funded at closing. This loan matures in December 2027, and carries an interest
rate of 5.67%. In addition, the Company refinanced the Cromwell Field Shopping
Center mortgage loan. The new loan has a principal balance of $15.0 million, of
which $10.2 million was funded at closing. This loan matures in December 2027
and carries an interest rate of 6.71%.

As of December 31, 2022, we were in compliance with all of the covenants under our debt agreements.

Fortress Mezzanine Loan

In connection with the acquisition of Midtown Row, we also entered into a $15.0
million mezzanine loan (the "Fortress Mezzanine Loan") secured by 100% of the
membership interests in the entity that owns Midtown Row. The mezzanine loan
matures on December 1, 2027. Pursuant to the mezzanine loan agreement, a portion
of the interest on the Fortress Mezzanine Loan will be paid in cash (the
"Current Interest") and a portion of the interest will be capitalized and added
to the principal amount of the Fortress Mezzanine Loan each month (the
"Capitalized Interest" and, together with the Current Interest, the "Mezzanine
Loan Interest"). The initial Mezzanine Loan Interest rate is 12% per annum,
comprised of a 5% Current Interest rate and a 7% Capitalized Interest rate. The
Capitalized Interest rate increases each year by 1%. The Fortress Mezzanine Loan
(including a prepayment penalty) will be due and payable in connection with a
Qualified Public Offering. However, in connection with a Qualified Public
Offering, the lender for the Fortress Mezzanine Loan has the right to convert
all or a portion of the principal of the Fortress Mezzanine Loan and any
prepayment penalty into shares of common stock at a price of $2.00 per share,
subject to certain adjustments. The mezzanine loan agreement provides for
cross-default in the event of a Trigger Event under the Eagles Sub-OP Operating
Agreement or an event of default under the loan agreement for the Midtown Row
mortgage.

Interest Rate Derivatives

We may use interest rate derivatives from time to time to manage our exposure to
interest rate risks. On December 27, 2019, we entered into an interest rate cap
agreement on the full $66.9 million Basis Term Loan to cap the previous variable
LIBOR interest rate at 3.5%. On June 29, 2022, the Basis Loan Agreement was
amended and restated to replace LIBOR with SOFR. The Basis Term Loan bears
interest at a rate equal to the greater of (i) SOFR plus 3.97% per annum and
(ii) 6.125% per annum. On August 1, 2022, the interest rate cap for the Basis
Term Loan was modified to cap the SOFR rate at 3.5%. This interest rate cap
matured on January 1, 2023. On November 23, 2022, we entered into an interest
rate cap agreement, effective January 1, 2023, on the full $66.9 million Basis
Term Loan to cap the SOFR interest rate at 4.65%. As of December 31, 2022 and
2021, the interest rate of the Basis Term Loan was 6.125%.

We also entered into two interest rate swap agreements on the Hollinswood loan
to fix the interest rate at 4.06%. The swap agreements are effective as of
December 27, 2019 on the outstanding balance of $10.2 million and on July 1,
2021 for the additional availability of $3.0 million under the Hollinswood loan.
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On October 6, 2021, we entered into an interest rate swap agreement on the
Greenwood Village Loan to fix the interest rate at 4.082%. Since our derivative
instruments are not designated as hedges nor do they meet the criteria for hedge
accounting, the fair value is recognized in earnings.

For the year ended December 31, 2022, we recognized a $3.4 million gain as a
component of "Derivative fair value adjustment" on the consolidated statement of
operations.

Fortress Preferred Equity Investment

On November 22, 2022, the Company, the Operating Partnership and the Eagles
Sub-OP entered into a Preferred Equity Investment Agreement with the Fortress
Member pursuant to which the Fortress Member invested $80.0 million in the
Eagles Sub-OP in exchange for the Fortress Preferred Interest. In connection
with the Preferred Equity Investment, the Operating Partnership and the Fortress
Member entered into the Eagles Sub-OP Operating Agreement, and the Operating
Partnership contributed to the Eagles Sub-OP its subsidiaries that, directly or
indirectly, own Brookhill Azalea Shopping Center, Vista Shops, Hollinswood
Shopping Center, Avondale Shops, Greenwood Village Shopping Center and Lamar
Station Plaza East in November 2022, as well as Cromwell Field in December 2022.
The subsidiaries of the Operating Partnership that indirectly own the following
eight properties were not contributed to the Eagles Sub-OP in connection with
the closing of the Preferred Equity Investment but are required to be
contributed to the Eagles Sub-OP on or prior to the applicable outside dates:
(i) Highlandtown, (ii) Spotswood and (iii) the Portfolio Excluded Properties.
The outside dates for Highlandtown, the Portfolio Excluded Properties and
Spotswood are May 6, 2023, June 30, 2023 and July 6, 2023, respectively.

Pursuant to the Eagles Sub-OP Operating Agreement, the Fortress Member is
entitled to monthly distributions, a portion of which is paid in cash (the
"Current Preferred Return") and a portion that accrues on and is added to the
Preferred Equity Investment each month (the "Capitalized Preferred Return" and,
together with the Current Preferred Return, the "Preferred Return"). The initial
Preferred Return is 12% per annum, comprised of a 5% Current Preferred Return
and a 7% Capitalized Preferred Return, provided that, until the Portfolio
Excluded Properties are contributed to the Eagles Sub-OP, the Capitalized
Preferred Return is increased by 4.75%. The Capitalized Preferred Return
increases each year by 1%. Commencing on November 22, 2027, the Preferred Return
will be 19% per annum, all payable in cash, and will increase an additional 3%
each year thereafter. Upon (i) the occurrence of a Trigger Event, (ii) during a
three-month period in which distributions on the Preferred Equity Investment are
not made because such payments would cause a violation of Delaware law or (iii)
if a Qualified Public Offering has not occurred on or prior to November 22,
2027, the entire Preferred Return shall accrue at the then-applicable Preferred
Return plus 4% and shall be payable monthly in cash. As of December 31, 2022,
the Capitalized Preferred Return was approximately $1.0 million and is reflected
within Preferred equity investment in the consolidated balance sheets. For the
year ended December 31, 2022, we recognized $0.4 million and $1.1 million of
Current Preferred Return and Capitalized Preferred Return, respectively, as a
reduction to additional paid-in capital in the consolidated statements of
equity.

Upon the closing of a Qualified Public Offering, unless earlier redeemed, the
Eagles Sub-OP must redeem the entire Fortress Preferred Interest by payment in
cash to the Fortress Member of the full Redemption Amount (as defined below),
provided that (i) the Eagles Sub-OP may elect, in its discretion, not to redeem
$37.5 million of the Preferred Equity Investment and (ii) $25.0 million of the
Preferred Equity Investment (less the amount of the Fortress Mezzanine Loan
converted into common stock in connection with such Qualified Public Offering,
if any) will be converted to shares of common stock at a price of $2.00 per
share, subject to certain adjustments. The Operating Partnership may cause the
Eagles Sub-OP to redeem the Fortress Preferred Interest in whole (but not in
part), by payment in cash to the Fortress Member of the full Redemption Amount,
as long as the Fortress Mezzanine Loan is repaid in full before or concurrently
with such redemption. The "Redemption Amount" is equal to the sum of: (i) all
outstanding loans advanced to the Eagles Sub-OP by the Fortress Member in
accordance with the terms of the Eagles Sub-OP Operating Agreement, together
with all accrued and unpaid return on such loans; (ii) the unredeemed balance of
the Preferred Equity Investment; (iii) an amount equal to the greater of (x) all
accrued and unpaid Preferred Return and (y) a 1.40x minimum multiple on the
amount of all loans and capital contributions made by the Fortress Member to the
Eagles Sub-OP in accordance with the terms of the Eagles Sub-OP Operating
Agreement, which minimum multiple shall be reduced to 1.30x upon the
consummation of a Qualified Public Offering; and (iv) all other payments, fees,
costs and expenses due or payable to the Fortress Member under the Eagles Sub-OP
Operating Agreement, including a $10.0 million exit fee unless the Redemption
Amount is paid upon or following the completion of a Qualified Public Offering.

The Operating Partnership serves as the managing member of the Eagles Sub-OP.
However, the Fortress Member has approval rights over certain Major Actions (as
defined in the Eagles Sub-OP Operating Agreement), including, but not limited to
(i) the adoption and approval of annual corporate and property budgets, (ii) the
amendment, renewal, termination or modification of Material Contracts, leases
over 5,000 square feet and certain loan documents, (iii) the liquidation,
dissolution, or winding-up of the Eagles Sub-OP, the Company or any of its
subsidiaries, (iv) taking actions of bankruptcy or failing to defend an
involuntary bankruptcy action of the Eagles Sub-OP, the Company or any of its
subsidiaries, (v) effecting any reorganization or recapitalization of the Eagles
Sub-OP, the Company or any of its subsidiaries, (vi) declaring or paying
distributions on any equity security of the Eagles Sub-OP, the Company or any of
its subsidiaries, subject to certain exceptions, (vii) issuing any equity
securities in the Eagles Sub-OP, the Company or any of its subsidiaries, subject
to certain exceptions, (viii) conducting a merger or consolidation of the Eagles
Sub-OP, the Company or the Operating Partnership or selling substantially all
the assets of the Company and its subsidiaries or the Eagles Sub-OP and its
subsidiaries, (ix) amending, terminating or otherwise modifying the loans
secured by the properties indirectly owned by the Eagles Sub-OP, subject to
certain exceptions, (x) incurring additional indebtedness or making prepayments
on indebtedness, subject to certain exceptions; (xi)
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acquiring any property outside the ordinary course of business of the Company and (xii) selling any property below the minimum release price for such property.

Under the Eagles Sub-OP Operating Agreement, "Trigger Events" include, but are
not limited to, the following: (i) fraud, gross negligence, willful misconduct,
criminal acts or intentional misappropriation of funds with respect to a
property owned by the Company or any of its subsidiaries; (ii) a Bankruptcy
Event with respect to the Company or any of its subsidiaries, except for an
involuntary bankruptcy that is dismissed within 90 days of commencement; (iii) a
material breach of certain provisions of the Eagles Sub-OP Operating Agreement;
(iv) monetary defaults or material non-monetary defaults under the Fortress
Mezzanine Loan or the mortgage loans secured by properties owned directly or
indirectly by the Eagles Sub-OP (including the Excluded Properties); (v) failure
to meet the minimum Total Yield requirements under the Eagles Sub-OP Operating
Agreement; (vi) failure to pay the Current Preferred Return (subject to a
limited cure period) or failure to make distributions as required by the Eagles
Sub-OP Operating Agreement; (vii) the occurrence of a Change of Control; (viii)
failure to contribute the Excluded Properties and consummate the related
transactions by the applicable outside date; (ix) Mr. Jacoby (A) ceasing to be
employed as the chief executive officer of the Company, (B) not being activity
involved in the management of the Company or (C) failing to hold an aggregate of
at least 3,802,594 shares of common stock and OP units, in each case subject to
the Company's right to appoint a replacement chief executive officer reasonably
acceptable to the Fortress Member within 90 days; and (x) material breaches or
material defaults of the Company, the Operating Partnership or their
subsidiaries under certain other agreements related to the Preferred Equity
Investment.

Upon the occurrence of a Trigger Event, the Fortress Member has the right to
cause the Eagles Sub-OP to redeem the Fortress Preferred Interest by payment to
the Fortress Member of the full Redemption Amount upon not less than 90 days
prior written notice to the Eagles Sub-OP, unless the Trigger Event is in
connection with a Bankruptcy Event, in which case the redemption must occur as
of the date of such Trigger Event.

Under certain circumstances, including in the event of a Trigger Event or if a
Qualified Public Offering has not occurred by November 22, 2027, the Fortress
Member has the right (among other rights) to (i) remove the Operating
Partnership as the managing member of the Eagles Sub-OP and to serve as the
managing member until the Fortress Member is paid the Redemption Amount, (ii)
cause the Eagles Sub-OP to sell one or more properties until the entire Fortress
Preferred Interest has been redeemed for the Redemption Amount, (iii) cause the
Eagles Sub-OP to use certain reserve accounts to pay the Fortress Member the
full Redemption Amount, and (iv) terminate all property management and other
service agreements with affiliates of the Company.

The obligations of the Operating Partnership under the Eagles Sub-OP are
guaranteed by the Company. In addition, Messrs. Jacoby and Yockey guaranteed the
full payment of the Redemption Amount in the event of a bankruptcy event of the
Company or its subsidiaries without the consent of the Fortress Member or
certain other events that interfere with the rights of the Fortress Member under
certain other agreements related to the Preferred Equity Investment.

Cash Flows

The table below sets forth the sources and uses of cash reflected in our
consolidated statements of cash flows for the years ended December 31, 2022 and
2021.

                                                     For the year ended December 31,
(in thousands)                                         2022                   2021             Change
Cash and cash equivalents and restricted cash
at beginning of period                           $          11,024       $         9,983     $    1,041
Net cash used in operating activities                       (4,101 )              (5,586 )        1,485
Net cash used in investing activities                     (135,491 )             (20,235 )     (115,256 )
Net cash provided by financing activities                  145,599                26,862        118,737
Cash and cash equivalents and restricted cash
at end of period                                 $          17,031       $  

11,024 $ 6,007

Operating Activities- Cash used in operating activities decreased by
approximately $1.0 million for the year ended December 31, 2022 compared to the
year ended December 31, 2021. Operating cash flows were primarily impacted by a
net decrease in changes in operating assets and liabilities of approximately
$1.0 million, of which approximately $2.8 million and $0.4 million is related to
the net change in accounts payable and accrued liabilities and receivables due
from related parties, respectively. This was partially offset by approximately
$1.2 million and $0.9 million related to changes in other assets and accounts
receivable, respectively.

Investing Activities- Cash used in investing activities during the year ended
December 31, 2022 increased by approximately $114.8 million compared to the year
ended December 31, 2021. During 2022, we acquired two properties and a real
estate parcel which resulted in an increase in net cash outflow of approximately
$112.1 million. In addition, we had an approximately $3.1 million increase in
capital expenditures for real estate during the year ended December 31, 2022 as
compared to the year ended December 31, 2021.

Financing Activities- Cash provided by financing activities for the year ended
December 31, 2022 increased by approximately $118.7 million compared to the year
ended December 31, 2021. The increase resulted primarily from an increase in net
borrowings during 2022 under debt agreements, which includes (i) a $91.0 million
increase related to the financing of the Midtown Row acquisition; (ii) an $80.0
million increase related to the Fortress Preferred Equity Investment; (iii) a
net increase of $2.9 million related to the refinancing of Lamar Station Plaza
West; (iv) a $7.8 million decrease related to the payoff of the Basis Preferred
Interest; (v) a net $5.3 million decrease related to the payoff of the MVB Term
Loan, MVB Second Term Loan and MVB Revolver; (vi) a net decrease of $3.7
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million due to the refinancing of the Cromwell mortgage loan and payoff of the
mezzanine loan; and (vii) a $3.5 million decrease related to the payoff of the
Lamar Station Plaza East mortgage loan. The net increases in 2022 were offset by
net borrowings during 2021, which included (i) a $23.5 million increase related
to the Greenwood Village acquisition; (ii) a $3.9 million increase related to
the Lamont Street Preferred Interest; (iii) a net increase of $2.8 million
related to the refinancing of the Vista Shops mortgage loan; (iv) the $1.0
million Lamont Street Minimum Multiple; (v) the receipt of a second unsecured
loan under the PPP Program in the amount of $0.8 million; and (vi) a $1.4
million decrease related to the payoff of the Cromwell land loan. Additionally,
debt origination and discount fees increased by approximately $6.3 million
during the year ended December 31, 2022 compared to the prior year.

Inflation

Inflation primarily impacts our results of operations as a result of wage
pressures and increases in utilities and repair and maintenance costs. In
addition, inflation could also impact our general and administrative expenses,
the interest on our debt if variable or refinanced in a high-inflationary
environment, our cost of capital, and our cost of development, redevelopment,
maintenance or other operating activities. Substantially all of our leases
provide for the recovery of increases in real estate taxes and operating
expenses. In addition, substantially all of our leases provide for annual rent
increases. We believe that inflationary increases may be offset in part by the
contractual rent increases and expense escalations previously described. In
addition, our leases for the residential portion of Midtown Row generally have
lease terms of 11.5 months or nine months, which we believe reduces our exposure
to the effects of inflation, although an extreme and sustained escalation in
costs could have a negative impact on our residents and their ability to absorb
rent increases.

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