MACKENZIE REALTY CAPITAL INC

Company Overview

MacKenzie Realty Capital, Inc. is a Maryland REIT that acquires, renovates and operates primarily mid‑market commercial and multifamily properties with a concentration in the Western U.S. (notably California) and a small allocation (up to 20%) to illiquid or non‑traded real estate securities. It is externally managed by MacKenzie Capital Management and affiliates and pursues value‑add, opportunistic and invest‑to‑own deals—preferring majority ownership so assets can be consolidated and actively repositioned. Recent activity includes the Aurora at Green Valley development (construction loan and preferred capital), the Green Valley Medical Center acquisition, multiple office and multifamily holdings, ongoing preferred/common equity raises, an ATM and a recent 1‑for‑10 reverse stock split (August 2025), leaving roughly 1.58M common shares outstanding post‑split.

Executive Compensation Practices

Because MacKenzie is externally managed, most senior pay flows through advisory and administration fee arrangements rather than traditional salaried employees—typical components include acquisition fees, asset management fees, development/construction fees and performance/transaction‑based promotes. Incentive metrics most likely tied to NAV/valuation gains, FFO/NOI performance, occupancy/leasing and successful project milestones (e.g., lease‑ups and construction stabilization), so rising rental revenue or completed dispositions will materially affect payout timing and size. Subjective Level‑3 valuations, impairment charges (e.g., Main Street West) and interest‑expense pressures can suppress performance fees or shift emphasis toward transaction fees, and the board’s annual review of advisory agreements is an important governance lever. Also watch equity‑based pay dilution dynamics: frequent common/preferred offerings, ATM use and reverse splits change per‑share economics and the realized value of any equity grants or distributions to affiliated managers.

Insider Trading Considerations

The company’s small post‑split float, recent reverse split and active use of capital markets (registered offerings, ATM, preferred issuances and registered directs) increase potential price volatility and create predictable windows when insiders or affiliated advisers might transact. Because day‑to‑day functions are performed by affiliated advisers, related‑party transfers, fee‑paid equity issuances and adviser entity sales are common patterns to monitor on Forms 3/4/5; these transactions can represent compensation in kind or monetization by insiders. Key catalysts that tend to trigger insider activity or create material nonpublic information include acquisition closings, construction loan draws/lease‑up milestones, impairment or valuation adjustments, debt refinancing events and announcements about preferred/common offerings. Finally, REIT tax rules, Section 16 reporting obligations, affiliated‑transaction disclosure requirements and customary blackout periods around material disclosures are relevant constraints that govern the timing and reporting of insider trades.