InPoint REIT Reserves Double to $8.8M, Driving $4.1M Q1 Loss

InPoint Commercial Real Estate Income, a commercial mortgage nontraded real estate investment trust managed by an affiliate of Inland Real Estate Investment Corporation, reported a first-quarter 2026 net loss of $4.1 million on total income of $5.2 million.

The loss was driven by a $4.9 million provision for credit losses under the current expected credit loss, or CECL, model – a swing of more than $6.3 million from Q1 2025, when the company recorded a $1.5 million reversal of credit losses. The provision brought InPoint’s total credit loss reserve to $8.8 million as of March 31, more than double the $3.9 million reserve carried at year-end 2025.

The reserve build is concentrated in two multifamily loans in Garland, Texas, both rated four on the company’s five-point internal risk scale. Together they carry asset-specific CECL reserves of $4.2 million. InPoint cited refinancing risk and collateral pressure ahead of 2026 maturities on both loans. Texas multifamily has been among the more pressured segments of commercial real estate through the current rate cycle.

The broader portfolio contracted in the quarter. InPoint’s commercial mortgage book stood at $337.6 million in principal across 15 loans as of March 31, down from $351.8 million at year-end, as $25.9 million in loan repayments outpaced $11.4 million in new originations. All 15 loans remained current on interest payments. The company also carries $93.3 million in real estate owned – property acquired through foreclosure – which generated $1.7 million in operating expenses in Q1 2026, up from $655,000 in the year-ago period.

Net interest income fell to $2.4 million in Q1 from $4.3 million a year earlier, reflecting both the smaller loan portfolio and lower prevailing rates. Total income of $5.2 million covered operating expenses of $4.4 million but left nothing to absorb the credit provision, producing the quarter’s loss.

The distribution rate was unchanged. InPoint declared $3.15 million in common distributions in Q1, equal to an annualized rate of $1.25 per share – a 9.3% yield on net asset value of $13.4992 as of March 31. Combined with $1.5 million in preferred dividends, total distributions declared in the quarter were $4.65 million against operating cash flow of $1.97 million. The company held $80 million in cash and cash equivalents at the end of the first quarter, providing liquidity to sustain the near-term distribution.

InPoint’s NAV has declined materially over the past year. AltsWire reported in April that the REIT’s total NAV attributable to common stock fell 14.9% year over year to $136.6 million as of March 31, down about 3.1% from the prior month. The per-share NAV of $13.4992 compares with approximately $16.47 a year earlier, a decline of roughly 18% over 12 months.

InPoint said it is evaluating “a possible future strategic transaction to maximize stockholder value” – language the company has used since at least mid-2025. The company terminated its public offering on Nov. 1, 2025. The board first disclosed it was evaluating strategic alternatives in 2023, when rising interest rates began compressing the REIT’s interest margin. The REIT’s share repurchase plan and distribution reinvestment plan remain suspended.

InPoint Commercial Real Estate Income seeks to originate, acquire, and manage a diversified credit portfolio secured by commercial real estate properties primarily within the United States. The REIT launched its initial public offering in October 2016.

InPoint is advised by an affiliate of Inland Real Estate Investment Corporation and sub-advised by an affiliate of Sound Point Capital Management LP. Inland Securities Corporation serves as the dealer manager.

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