Quarterly Report

Q1 2026

“Performance continues to be driven by stable operating income and active asset management across the portfolio.”

Dear Investors,

We are encouraged by the increase in acquisition activity during the quarter and the depth of our current pipeline, which positions the Fund to continue capitalizing on opportunities that have come during this market cycle.

The Fund delivered 13.30% in total returns and 11.02% in realized returns for the quarter. Performance continues to be driven by stable operating income and active asset management across the portfolio.

We have a growing pipeline of properties under contract including The Legends at Sparks Marina, a 421,000 square foot regional open-air shopping center located in Sparks, Nevada. The property is approximately 96% leased and serves as the leading retail and entertainment destination within the Reno-Sparks market and #4 in all of Nevada. We are currently in our due diligence period and expect to close this summer.

We have been pursuing the property for several years, and we are excited to have it under contract. It provides a very attractive combination of good in place cash flow – with in-place investor yields above 10%, while also being a very stable asset that strengthens the overall portfolio. In addition, there is notable upside in the property. The asset was originally developed as an outlet center; however, as Sparks and Reno have significantly grown and matured, the asset has successfully transitioned into a traditional retail center. That being the case, there are many legacy leases from the previous era. As those leases mature in the coming months and years, transitioning those leases to more favorable terms and structures will create significant value on top of the attractive in- place returns.

For those considering an investment in the Fund, this represents a timely opportunity to participate. We encourage you to connect with our team to discuss this acquisition and the Fund more broadly.

During the quarter, we acquired six projects, including the purchase of a note secured by a property located in Billings, Montana. We are currently working with the borrower to obtain a deed in lieu which will give us fee simple title to the asset.

We have generated tenant interest that provides flexibility in our leasing strategy and will create significant value in the asset as we lease space.. The acquisition represents how we are creatively working to create real value. This is a market that requires diligence, creativity, and relationships, and this project in particular reflects how the team works to create value for the portfolio and our partners.

The activity this quarter reflects the groundwork laid over the past year. While 2025 was lighter on acquisitions, we remained active in the market, and those efforts are now translating into awarded opportunities. Maintaining consistent engagement within the brokerage community continues to be a key differentiator.

We also executed on the sale of cell tower easements at Orchard Pointe in the Denver Tech Center, generating a profitable outcome and demonstrating our ability to unlock additional value across the portfolio.

Leasing activity across the portfolio improved over the past several months, with increased tenant engagement and a growing number of executed leases. While the majority of activity in our suburban office portfolio continues to come from tenants in the 5,000 square-foot range, we are beginning to see larger users re-enter the market, which could represent meaningful upside over time.

As discussed on our most recent manager call, late 2024 and 2025 represented the peak of lease rollover across the portfolio. That period has largely passed, and we are now focused on leasing vacant space. Early traction has been positive, and we are encouraged by the momentum.

The broader office market has also shown improvement in leasing activity, driven by tenants prioritizing fully built out suites. The Fund’s structure allows us to continue investing in our spaces and capture this demand by delivering functional, tenant-ready product across the portfolio.

We look forward to continuing to build on this momentum and appreciate your continued trust and partnership.

Travis Barney, Chief Executive Officer
Alturas Capital Partners, LLC

Devin Morris, Chief Operating Officer
Alturas Capital Partners, LLC

Blake Hansen, Chief Investment Officer
Alturas Capital Partners, LLC

Connect With Our Team

Photo: Idaho

Q1 Key Numbers

16.50%

Average Realized Return

15.89%

Average Total Return

15.89%

Average Total Return

$11.00M 

Realized Net Income

$11.00M 

Realized Net Income

$1,681.76

Unit Price

$713.15M

Assets Under Management

*Stated returns are average annualized investor returns. Individual investor returns may vary based on the unit pricing at the time of investment. Realized net income includes realized gains and losses and excludes unrealized gains and losses recorded during the period. Financial information herein related to the quarters ended in 2025 are unaudited as of the date of this report.

Realized Returns

Details

Total Returns

Details

Unit Price

Details

Photo: Reno, Nevada

Acquisitions Update - Legend at Sparks Marina

We were pleased to deliver 2025 Schedule K-1s to our partners in April. Consistent with prior years, the Fund maintained a high level of tax efficiency, with most investors realizing minimal federal tax liability on their allocated share of 2025 income. This outcome was driven in part by targeted cost segregation studies performed on select assets, allowing us to accelerate depreciation. In addition, our tax advisors identified certain expenditures that, while capitalized for GAAP reporting, were eligible for immediate deduction for tax purposes. We also benefited from bonus depreciation, with applicable rates varying based on when assets were placed in service under prevailing tax law, further enhancing overall tax efficiency.

As always, we remain thoughtful about balancing near-term tax benefits with the long-term impact on investor capital accounts, and we review these strategies frequently. While our objective is generally to minimize federal taxable income, outcomes can vary; for 2025, the Fund generated approximately $2 million of federal taxable loss. It is important to note that certain states, including Idaho, do not fully conform to federal bonus depreciation rules, so this loss does not fully flow through at the state level. We continue to actively manage these dynamics to optimize after-tax outcomes for our investors.

Photo: Idaho

Tax Update

We were pleased to distribute 2024 K-1s to partners in April. As in prior years, the Fund continues to demonstrate strong tax efficiency, with partners experiencing minimal tax liability on their 2024 allocation of Fund income. In 2024, the Fund performed cost segregation studies on select properties, increasing depreciation expense by taking advantage of the 60% bonus depreciation available this year.

Additionally, our tax partners identified certain expenditures that, while capitalized per GAAP, qualified as deductible expenses for tax purposes. As always, we remain mindful of the long-term implications of these strategies on investor tax capital accounts and continue to assess them annually. In addition, our tax partners are reviewing the Fund’s capital allocation structure to ensure it remains aligned with IRS guidelines and continues to fairly reflect each partner’s proportional share of the Fund. Doing so will continue to support proper tax treatment while helping preserve flexibility for the future.

*Returns are average annual returns. Actual returns for each investor will vary based on the unit price paid for units held.

**Assumes all investors pay an average blended federal tax rate of 37% on ordinary income and 20% on capital gains and excludes the impact of state income taxes. Actual tax rates will vary for each investor. We recommend consulting with your personal tax advisor to understand the various federal and state income tax implications associated with investing in the Fund.

*Returns are average annual returns. Actual returns for each investor will vary based on the unit price paid for units held.

Portfolio at a Glance

Originally purchased in 2018 for $4 million, Parkway Plaza has been an excellent case study of our value-add approach. At acquisition, we originated a loan of $3 million and contributed $1 million of equity. We have since injected an additional $1.2 million in property improvements, most notably a new facade for the northern wing of the shopping center and various tenant improvements. At acquisition, the property was 77% occupied and had an NOI of $370,000. It is now 100% leased and had an NOI of $595,000 in 2024.

In March, we refinanced the shopping center and because we have been able to execute our strategy, we were able to recoup roughly $2.1 million in equity through this refinance. Over our 7 years of ownership, we have contributed $3.66 million to the property and withdrawn nearly $3.73 million through the sale of a part of the shopping center in 2021 and the recent refinance. That means we have recaptured more equity from the property than we have contributed which equates to essentially an infinite return on that equity. Further, this example illustrates that although interest rates are higher than they have been in previous years, for assets that are well capitalized and performing well, debt is available. As ever, we continue to proactively manage the portfolio to maximize cash flow and realize the full potential of all our investments.

Photo: Wasatch Mountains, Utah

Portfolio at a Glance

While cash flow remains more challenging in this environment, there is a significant amount of value in the portfolio. To demonstrate this value and to show our approach to fair values, we wanted to go through several of the assets that were either marked up or down this quarter.

Key highlights:

Total adjustments: 12 properties
Markups: 9 properties
Markdowns: 3 properties
Net portfolio impact: +$2.01M net markup

We primarily determine fair value using an income approach that reflects each property’s current and anticipated cash flow. Valuations are subjective. Our team works to limit this subjectivity by evaluating rent roll, vacancy reserves, operating expenses, and conservative cap rates. Newly acquired properties are generally held at cost until something has changed, while stabilized assets are re-evaluated using our internal methodology. We also reference third-party opinions of value, and comparable transactions to ensure our assumptions are fair, consistent, and conservative.

Photo: Wasatch Mountains, Utah

Portfolio at a Glance

Total adjustments: 12 properties
Markups: 9 properties
Markdowns: 3 properties
Net portfolio impact: +$2.01M net markup

Photo: Wasatch Mountains, Utah

Photo:

Q1 Acquisitions

Walgreens

Idaho Falls, ID

Retail

14,280 SF

Pershing Plaza is a 101,341-square foot, multi-tenant shopping center located in Cheyenne, WY. The property is 100% leased and anchored by Gold’s Gym and Capitol Cinema, along with a strong mix of regional and local tenants. The project was brought to us through a long-standing broker relationship and represented a compelling opportunity to acquire a retail asset with strong in-place cash flow, with the potential to improve CAM revenue that had been previously under- collected. This acquisition marks the Fund’s second asset in Wyoming and adds to the Fund’s growing presence throughout the Intermountain West.

Walgreens

Idaho Falls, ID

Retail

14,280 SF

Walgreens

Idaho Falls, ID

Retail

14,280 SF

Take 5 Kuna

Kuna, ID

Retail

1,400 SF

Take 5 Kuna

Kuna, ID

Retail

1,400 SF

Take 5 Kuna

Kuna, ID

Retail

1,400 SF

11101 Overland

Boise, ID

Retail

4,900 SF

11101 Overland

Boise, ID

Retail

4,900 SF

11101 Overland

Boise, ID

Retail

4,900 SF

Idaho Fitness Factory

Star, ID

Retail

12,000 SF

Idaho Fitness Factory

Star, ID

Retail

12,000 SF

Idaho Fitness Factory

Star, ID

Retail

12,000 SF

7802 W Overland Road

Boise, ID

Retail

3,387 SF

7802 W Overland Road

Boise, ID

Retail

3,387 SF

7802 W Overland Road

Boise, ID

Retail

3,387 SF

905 S 24th Street

Billings, MT

Retail

100,800 SF

905 S 24th Street

Billings, MT

Retail

100,800 SF

905 S 24th Street

Billings, MT

Retail

100,800 SF

Photo: Monument Valley Navajo Tribal Park, UT

Q1 Dispositions

Orchard Pointe Cell Towers (Partial Sale)

Denver, CO

Suburban Office

We completed the sale of The Shops at Decker Lake, a retail center located in Salt Lake City, Utah. The property was acquired in March 2019 at approximately 68% occupancy, with a tenant mix that included several lower-credit tenants and near-term rollover, including the eventual vacancy of the center’s largest tenant. During our ownership, we were successful in improving the tenant mix and completed improvements to the façade, enhancing the overall quality of the center. These efforts ultimately resulted in the property being 100% leased prior to sale. Although we did not intend to sell the center, we received an unsolicited offer that exceeded what we believed was the long-term intrinsic value of the property. As a result, we elected to realize the value created over the last several years, generating a substantial gain for the Fund and our partners.

Orchard Pointe Cell Towers (Partial Sale)

Denver, CO

Suburban Office

Gainey Ranch Cell Towers

Scottsdale, AZ 

Suburban Office 

1,438 SF

We completed the sale of 2656 Eagle Road, a Take 5 Oil Change development located along one of Idaho’s busiest retail corridors. The land was originally acquired for two build-to-suit developments, with the second pad leased to Livewell Animal Hospital, a national veterinary brand, which is scheduled for completion this Spring. The property traded at a low cap rate, resulting in a 75.10% IRR. This outcome reflects the strength of the Fund’s development model, which is underwritten with a margin of safety on return on cost and downside protection. Because of this, the Fund can repeatedly develop and dispose of single tenant NNN assets to buyers willing to pay a premium and recycle capital efficiently.

Gainey Ranch Cell Towers

Scottsdale, AZ 

Suburban Office 

1,438 SF

Photo: La Sal Mountains, UT

Q1 Acquisition Pipeline

Legends at Sparks Marina

Sparks, NV

Retail 

420,165 SF 

Core

120 N Nola:

Meridian, ID

Industrial

1,400 SF

Build-to-Suit

Idaho Fitness Factory:

Various Locations

Retail

11,600 SF 

Build-to-Suit

Idaho Fitness Factory:

Various Locations

Retail

11,600 SF 

Build-to-Suit

Idaho Fitness Factory:

Various Locations

Retail

11,600 SF 

Build-to-Suit

Gateway at Ten Mile:

Meridian, ID

Retail

2.00 Acres

Build-to-Suit

Gateway at Ten Mile:

Meridian, ID

Retail

2.00 Acres

Build-to-Suit

Gateway at Ten Mile:

Meridian, ID

Retail

2.00 Acres

Build-to-Suit

2727 State:

Boise, ID

Retail 

141,636 SF 

Build-to-Suit

Current Investments

83.96%

Occupancy Rate

88.88%

Lease Rate

4.09M SF 

Total Square Feet

1.79x

Debt Service Coverage Ratio

$242.38M

Investor Capital

46.43%

Current Reinvestment Rate

Markets

Property Types

Above charts are based on contributed capital.

83.96%

Occupancy Rate

88.88%

Lease Rate

4.09M SF 

Total Square Feet

1.79x

Debt Service Coverage Ratio

$242.38M

Investor Capital

46.43%

Current Reinvestment Rate

Markets

Property Types

Above charts are based on contributed capital.

Details

Portfolio

Photo: Tonto National Forest, Arizona

Announcements??

K-1 Delivery

As referenced earlier in this report, Schedule K-1s for the 2024 tax year are now available through the investor portal. If you have not yet received your K-1 or need assistance accessing it, please contact our team.

2025 Audited Financials

Our auditors are in the final stages of completing the Fund’s 2024 audited financial statements. We expect to distribute the finalized report within the next week.

Upcoming Events

We are looking forward to welcoming investors to our first gathering of the year in Boise on May 15–16. While registration for that event is now closed, we do have space available for our August and October gatherings.

Fund Description

Portfolio

The Alturas Real Estate Fund, LLC was formed by Alturas Capital Partners to provide accredited investors access to professionally managed real estate investments. The Fund is a $500 million equity offering created to make commercial and residential real estate investments. It targets middle-market properties frequently ignored by larger funds. These properties can be profitable as a diverse portfolio. 

The Fund was created in May 2015 and owns properties in the Intermountain West and Inland Northwest. Managers of the Fund are continually searching for new properties to add to the Fund that meet strict underwriting criteria including a margin of safety, with a focus on cash flows.

Photo: Sawtooth Mountains, ID

Fund Description

Portfolio

Photo: Sawtooth Mountains, ID

2025 Year In Review

10 plus years of building our team, our partnerships and our portfolio has given us optionality in how we generate returns for our investor partners. While returns from operations have been more difficult the last few years for reasons we have discussed (tenant turnover, construction cost, operating expense inflation, and higher interest rates) we are maintaining a solid base. We are working diligently to improve this, and it remains our top focus. In most cases, the trend is now positive, including cost inflation and interest rates, but most importantly from the tenant demand perspective. Demand for retail and industrial space remains very strong, and office demand is recovering, even in our weakest market (Denver). However, it takes time to see some of these changes reflected in the Fund’s returns, and while challenges may remain, the trends have begun to shift.

The Fund’s evergreen structure is a meaningful advantage for our partners because it allows us to be nimble and opportunistic across market cycles and investment strategies. We are not forced buyers when pricing is unattractive, nor are we forced sellers when the market is disconnected. The Fund’s structure provides diversification not only by asset class, geographical location, and tenant industry. Most importantly, it provides diversification over time. Having the ability to hold, improve, and realize the value created in these assets when conditions are favorable, allows value creation to compound. All these items, when coupled together, provide several levers to generate returns. Some of these include:

Completing development projects and generating returns on these assets either through sales or rent. Our current projects represent approximately $66.51M in total project cost, with an additional $27.47M in future development projects, that we will begin to realize in the coming years.

Selling assets where the value has been maximized. We have several properties similar to the assets we sold in 2025 (Adelmann, Decker Lake) that could be prime candidates to sell and reallocate that capital towards projects with stronger long-term return potential.

Selling components of assets at low cap rates (arbitrage). This is something we are considering with cell tower easements that trade for very low cap rates. This could also apply to pad sales at retail centers.

Leasing office space through our very successful spec suite program. To date, we successfully leased approximately 99,200 SF in spec suite space.

Adding additional accretive assets to the portfolio through acquisitions. While this has been more difficult in recent years, we have and will continue to create investment opportunities through our efforts and the efforts of our partners, and we expect this to accelerate (see Acquisition Pipeline).

Photo: Grand Teton National Park, WY

Financial Summary

Assets Under Management (AUM)

Photo: Bryce Canyon, UT

2025 Acquisitions

6

Total Acquisitions

175,000 SF

Total Square Feet Acquired

15.89 Acres

Total Acres Purchased for Development

$37.91M

Total AUM Acquired

Photo: Grand Teton National Park, WY

2025 Dispositions

6

Dispositions

3

Partial Sales

45.35%

Realized IRR

$30.91M

Total Sales Price

80,220 SF

Total Square Feet Sold

Photo: Byrce Canyon National Park, UT

2025 Leasing

New Leases

70

*New Leases Signed

381,000 SF

Average realized return

$5.62M

Annual Rent

Renewed Leases

93

Renewed Leases Signed

507,387 SF

Average realized return

$7.17M

Annual Rent

Total Leases

689

Total Leases 2024

3,977,527 SF

Average realized return

88.88%

**Lease Rate as of 12/31/25

*Excludes in-place leases at properties acquired in 2025

**Percentage leased differs from portfolio occupancy rate due to leases signed where tenants had not yet taken occupancy.

Photo: Garden of the Gods, CO

2025 Investor Highlights

12.43%

Realized Return

13.60%

Total Return

40+

New Investor Partners

$28.26M

Total Capital Raised

Our Investment Offerings

Equity Offering

Our equity offering allows investors to invest in a diversified portfolio of commercial real estate assets focused on generating excellent ongoing returns from operations. The Fund's offering is best suited for investors who understand and align with the Fund's investment strategy and value long-term partnerships.

Targeted Total Returns: 9-14%

Preferred Return: 8% paid quarterly

Profit Split: 70% investors, 30% manager after preferred return

Fees: 1.5% asset management fee

Minimum Investment: $250,000

Fixed-Income Offering

Our fixed-income offering provides our partners with a fixed-income investment with attractive risk-adjusted returns and additional liquidity options. Investors can receive distributions in cash or accrue the interest earned throughout the life of the note. Upon maturity of the note investment, partners can reinvest their investment into another note, convert their funds into equity, or redeem their funds.

Interest Rate: 7-9% paid quarterly (rate dependent on duration and amount)

Investment Type: Promissory note

Security: Subordinate to property debt; senior to equity

Term: 24-60 months

Minimum Investment: $100,000

Our Investment Offerings

Equity Offering

Targeted Total Returns: 9-14%

Preferred Return: 8% paid quarterly

Profit Split: 70% investors, 30% manager after preferred return

Fees: 1.5% asset management fee

Minimum Investment: $250,000

Fixed-Income Offering

Interest Rate: 7-9% paid quarterly (rate dependent on duration and amount)

Investment Type: Promissory note

Security: Subordinate to property debt; senior to equity

Term: 24-60 months

Minimum Investment: $100,000

All projections are hypothetical and predicated upon various assumptions that may or may not be identified as such. The future operating and financial performance information contained herein is for illustrative purposes and is not intended to portray any sort of targeted or anticipated returns. There can be no assurance that the Fund will achieve its investment objectives and actual performance may vary significantly.

Alturas Capital Partners, LLC and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for tax, legal or accounting advice.