Leser Into December 2026: Does The Liquidity Bridge Really Hold

December 2026 Is The Real Test, Not June

The main article already established that June 2026 is not the end of the story, only the first checkpoint. This follow-up isolates the narrower question that now matters most: after everything Leser managed to do by March 2026, is there a proven liquidity path all the way to December 31, 2026, or only a few months of time bought through another round of monetization and financing?

The right framework here is all-in cash flexibility. The question is not how much NOI or FFO the portfolio can produce in a normal year. The question is how much cash is actually left after the real uses of cash, especially principal and interest. Under that framework, Leser has clearly bought itself room into June 2026. The annual report says solo cash stood at about $26.7 million at year-end 2025, and that after the transactions completed or financed by the approval date of the report, solo cash rose to about $70 million. That covers June. The company also said separately on March 31, 2026 that it had the cash needed to meet all of its June 2026 bond obligations, principal and interest. But the same report also makes clear that the larger wall remains in December: about $92.6 million of principal and another $14.8 million of interest due on December 31, 2026.

That is the core issue. June 2026 is a bond-service wall of about $60 million. December 2026 jumps to about $107.4 million. That jump comes at a point where some of the liquidity sources are already embedded in the March cash balance, some are still conditional, and some require the company to keep selling or encumbering assets that currently generate NOI.

What Was Already Locked In By March 2026

The strong part of the picture is that March 2026 cash was not built on vague future plans. It came from several moves that had already happened. The sale of the four Georgia and Florida assets generated about $20.3 million net to the company after senior debt repayment, but only about $8 million remained as free cash. Roughly $12 million from that transaction went straight into the Series H trust account and was used for the partial early redemption at the end of March. That distinction matters. Gross transaction proceeds are not the same thing as free liquidity.

Three more sources had already converted into cash by the report approval date: the release of about $12 million from the 2440 Fulton deposit, the Monsey financing that generated about $12.5 million of net excess cash, and the Bristol sale that generated about $11.3 million net. Together with year-end solo cash, that is what built the March cash position.

But this is exactly where the reading has to stay disciplined. This is not a December bridge. It is a June bridge. The company itself says so in substance: the roughly $70 million solo cash balance covers the June 2026 principal and interest payment. Not more than that.

The Series H Early Redemption Bought Time, But Did Not Solve December

The partial early redemption executed on March 31, 2026 changed the Series H schedule, but only at the margin. The early redemption covered 10.09711% of the original series. After that, only a small piece remains for June 30, 2026, while the bulk still sits on December 31, 2026.

That point matters because it is easy to look at the March redemption and feel that Series H has already been materially de-risked. It has not. The annual note explicitly says Series H is due in full on December 31, 2026, and management’s own December plan does not rely only on McDonald. It also relies on more asset monetizations and on a bank refinancing of the remaining Series H balance.

If the December bridge is simplified using only what is already disclosed in the approved evidence set, the picture becomes very sharp. Start with roughly $70 million of March solo cash. Deduct about $60 million of June bond service. That leaves roughly $10 million before any new source. Even if McDonald closes and adds about $17 million, even if Leone contributes another $1 million of immediate cash, and even if the additional financing the company estimates at 2440 Fulton materializes in full and adds about $15 million, the total only reaches about $43 million. That is still far short of the $107.4 million needed at the end of December, before adding any optimistic assumptions around further sales.

This is not meant to be a full forecast. It excludes recurring property cash flow and it excludes the additional disposals management wants to execute. But that is exactly why it is useful. It shows that the December path does not stand on the already-hard sources alone. It stands only if another execution round happens.

The December Sources Are Not Equal In Quality

McDonald Is The Largest Next Source, But It Is Still Conditional

McDonald is the most meaningful remaining source still not closed. On March 31, 2026 the company signed a conditional sale at about $41 million, above the carrying value of about $36.5 million, with debt on the property at about $19 million. Management expects about $17 million of excess cash. That is a real number, and it is not framed as a distressed exit below book.

But it is still not cash in hand. The buyer has a 30-day diligence period. Completion is subject to title insurance acceptable to the buyer and to tenant estoppels. The long-stop closing date is June 30, 2026. In other words, the largest next source is also conditional, and it sits on a fairly tight timetable.

Leone Is More Balance-Sheet Cleanup Than Fresh Cash

At first glance the Leone transaction looks like a roughly $3.2 million source. In practice, the report says only about $1 million is immediate cash. The balance is offset against roughly $2.3 million that the company otherwise owed minority partners from earlier sales of unencumbered assets, and the minority partners also assume the senior loan on the asset and release the company from it.

That is still useful. It improves liquidity and simplifies the structure. But it has to be called correctly: it does not add $3.2 million of new cash to the company. In December 2026 terms, it is a helpful cleanup move, not a bridge-defining source.

Monsey Is Real Cash, But It Uses Up Future Flexibility

The Monsey financing is probably the cleanest source in this approved set. The property was previously unencumbered, it was valued at about $26.05 million as of December 31, 2025, and the company raised about $15.63 million against it for 18 months, with one six-month extension option, producing about $12.5 million of net excess cash.

The benefit is obvious: this is real cash, and it does not require selling a current NOI stream. The cost is also obvious: the company takes an unencumbered land asset, places a first mortgage on it, assigns rents and agreements, and funds an interest reserve deposit of about $1.93 million out of the loan proceeds. This is not an earnings-quality improvement. It is a liquidity move.

2440 Fulton Is The Swing Factor, But Not Yet A Proven One

2440 Fulton is the major swing factor in the December thesis. On the positive side, the company already released about $12 million from the deposit there, and the annual report says about $4 million still remains with the bank as collateral for the senior loan during the free-rent months. On the forward-looking side, management estimates that it can raise an additional roughly $15 million against the part of the property not leased to New York City, once that portion is released from the current lien in the second quarter of 2026.

But there is a real qualifier. The first roughly $15 million estimate depends first on getting that portion released from the existing lien after the free-rent period ends in the second quarter of 2026. Only after the vacant space is leased does management say there could be further financing beyond that. So 2440 Fulton is not a signed funding source. It is a mix of a deposit release that already happened, a first estimated financing step that still has to materialize, and additional upside that already depends on full commercial execution.

That matters even more because 2440 Fulton is not just collateral. It is also supposed to be one of the main earnings repair assets for 2026. Management itself says that on a full-year basis under the New York City lease, the property could contribute about $16 million of NOI and about $6.5 million of annual AFFO. In other words, the same asset is being asked both to rebuild 2026 earnings power and to act as one more liquidity lever for December.

The Cost Of Liquidity Is Erosion In The NOI Base

The part that is easy to miss on a first read is that Leser is not solving December only through financing. It is also selling NOI. Bristol is already gone from the portfolio. McDonald is expected to leave if the sale closes. Leone, smaller but still relevant, also exits. These are not just asset values and cash proceeds. They are income-producing properties that contributed to 2025 NOI and FFO.

In 2025, Bristol generated about $2.836 million of NOI and about $1.785 million of FFO. McDonald generated about $1.915 million of NOI and about $1.05 million of FFO. Leone generated about $0.432 million of NOI and about $0.167 million of FFO. Together, those three assets remove about $5.183 million of NOI and about $3.002 million of FFO from the portfolio, in exchange for about $29.3 million of immediate or expected cash, with part of that cash still conditional.

This is not a critique of the transactions themselves. Bristol sold at the updated appraisal value. McDonald was signed above carrying value. Leone also removed senior debt and a minority obligation. But the right analytical split is still crucial: the immediate liquidity layer improved, while the future NOI layer weakened. If the company has to execute another disposal wave from the eight assets now marked for sale, that tradeoff only grows.

The annual report adds two details that sharpen this tension. First, the December wall does not disappear on McDonald alone. Management says it is also pursuing additional disposals with an aggregate fair value of about $352 million, which it believes could generate up to roughly $150 million of positive cash flow after loan repayment and before repaying bonds secured by those assets. Second, the covenant cushion remains thin. Series H’s debt-to-CAP ratio stood at 74.38% against a 75% ceiling, and the company had already posted a $2.5 million security deposit because 25 Oakland was below the required occupancy threshold. That matters because the December plan partly assumes a refinancing of the remaining Series H balance. The collateral base is real, but the room for error is not wide.

Conclusion

The continuation thesis is simple: June 2026 is funded, December 2026 is still not proven. Leser did real work in March 2026. It released deposit cash from 2440 Fulton, financed Monsey, sold Bristol, executed the partial Series H redemption, and lifted solo cash to about $70 million. That is meaningful.

But the same sequence also clarifies what is still missing. For the December path to hold, McDonald has to close in reality, 2440 Fulton has to move from estimated funding capacity to actual financing, and the company still has to execute more disposals or refinance the remaining Series H balance. Without those steps, this is not yet a complete liquidity bridge. It is mainly time bought.

That is what a quick read can miss. March 2026 created real relief. But that relief was bought partly by selling NOI-producing assets, and partly by adding new encumbrances to previously unencumbered assets. The key question is no longer whether Leser has assets. The key question is whether it can keep turning them into cash in time, and on terms that do not leave too little NOI behind after December 31, 2026.