Chicago Atlantic Reports Q3 2026 Earnings and Plans Merger
News related to:Chicago Atlantic Real Estate Finance · 3 min read
CHICAGO, Nov. 10, 2026 /CourierPR/ -- Chicago Atlantic Real Estate Finance, a commercial mortgage real estate investment trust, reported its financial results for the third quarter ended September 30, 2026. The company delivered distributable earnings of $0.49 per diluted weighted average share, despite a challenging macroeconomic environment and heightened uncertainty across the regulatory landscape and the mortgage REIT sector.
Peter Sack, Co-Chief Executive Officer, noted that the company's real estate secured cannabis pipeline has decreased from approximately $204 million to $174 million since the last quarter end. However, Sack highlighted that the company's credit fundamentals compare favorably to its peers.
The company's portfolio activity includes the holding of 31 individual Koach Notes secured by 31 retail properties, which were originated during the quarter. As of September 30, 2026, the outstanding balance on the Koach Notes was approximately $59.1 million. The company also increased the available borrowing capacity on its Revolving Loan from $110.0 million to $117.5 million during the three months ended September 30, 2026, due to additional commitments from existing lenders.
As of September 30, 2026, the company had approximately $144.4 million of total drawn leverage, comprised of $94.4 million drawn on the secured revolving credit facility and $50.0 million of outstanding senior unsecured notes due 2028. The company issued 4,306,754 shares of common stock to Koach in a private placement transaction in exchange for approximately $62.6 million of second lien promissory notes (the "Koach Notes") on July 9, 2026. As of September 30, 2026, the outstanding balance on the Koach Notes was approximately $59.1 million.
The company also reported that as of November 10, 2026, it had $15.2 million available on its secured revolving credit facility, and total liquidity, net of estimated liabilities, of approximately $12.0 million.
Chicago Atlantic offered an outlook for full year 2026, expecting to maintain a dividend payout ratio based on distributable earnings per weighted average diluted share of approximately 90% to 100%. The company noted that this outlook assumes it continues to operate on a standalone basis and does not reflect the effects of the pending merger with Chicago Atlantic BDC, Inc. (NASDAQ: LIEN), an affiliated business development company that is externally managed by an affiliate of the company's manager.
On June 17, 2026, the company entered into an Agreement and Plan of Merger with Chicago Atlantic BDC, Inc., with the company merging with and into LIEN. At closing, REFI stockholders will receive a number of shares of LIEN common stock determined based on the ratio of REFI’s net asset value per share, as adjusted in accordance with the Merger Agreement, to LIEN’s net asset value per share, similarly adjusted. Former REFI stockholders are expected to own approximately 50.5% of LIEN immediately following the merger. The shares of common stock issued in the Koach transaction will be reflected in the inputs used to determine the exchange ratio at closing, and the actual pro forma ownership percentage may differ from the March 31, 2026, estimate.
The merger is subject to the approval of stockholders of both REFI and LIEN, including approval by REFI stockholders of REFI’s election to be regulated as a business development company under the Investment Company Act of 1940 and approval of a new investment advisory agreement. The merger is expected to close in 2027, but there can be no assurance that it will be completed on the anticipated terms or timing, or at all.