Breaking Down Belpointe PREP, LLC (OZ) Financial Health: Key Insights for Investors

You're looking at Belpointe PREP, LLC (OZ) and seeing a Qualified Opportunity Fund (QOF) that's finally shifting from a pure development story to an operating one, but the financials show a classic high-growth tension. The core takeaway is this: the asset value is rising, but the cost of that growth is spiking. As of September 30, 2025, the company's total assets hit a solid $570.8 million, a clear sign that projects like VIV are coming online, which triggered a massive $180.8 million reclassification to operating real estate. That transition is why year-to-date rental revenue jumped to $6.12 million, but still, the net loss for the first nine months of 2025 swelled to $(28.4) million, largely due to a net debt position of $251.4 million and the corresponding interest expense. Here's the quick math: with the Net Asset Value (NAV) per Class A unit at $116.74 (as of June 30, 2025) and the unit price trading near $59.51, you have a massive discount to asset value, but you defintely need to understand how long the market will wait for that operating cash flow to turn positive.

Revenue Analysis

The direct takeaway is clear: Belpointe PREP, LLC (OZ) is transitioning from a capital-intensive developer to an operating real estate company, and the revenue figures for 2025 reflect this pivot. You're looking at a massive ramp-up in rental income as their core assets finally come online, but it's still early days.

For the nine months ended September 30, 2025, the company reported total revenue of $6.12 million, a dramatic increase from $1.58 million in the same prior-year period. This isn't organic 5% growth; this is a fundamental change in the business model, so you need to understand the source of that revenue.

Primary Revenue Streams and Growth Drivers

Belpointe PREP, LLC (OZ)'s primary revenue source is rental revenue from its portfolio of commercial and mixed-use properties located in Qualified Opportunity Zones (QOZs). The company's entire focus, as detailed in their Mission Statement, Vision, & Core Values of Belpointe PREP, LLC (OZ), is on developing these assets, and 2025 is the year that work started to pay off.

Here's the quick math on the year-over-year change: The year-to-date revenue growth rate is approximately 287.3%. That kind of percentage is defintely a signal that the development pipeline is finally converting into income-generating assets. The growth is almost entirely driven by the Mixed-use segment, specifically the lease-up of major projects in Florida.

• Primary Source: Rental revenue from real estate.
• Growth Driver: Properties moving from construction to operation.
• Key Projects: Aster & Links and VIV in Florida.

Segment Contribution and Significant Changes

The company reports revenue across two segments: Commercial (office, retail, warehouse) and Mixed-use (residential and retail combinations). The significant change is the placement of the Aster & Links project in Sarasota, Florida, into service. This mixed-use development, featuring 424 residential units and 51,000 square feet of retail, is the engine. As of October 31, 2025, over 55% of the units at Aster & Links were leased, driving the bulk of the revenue increase.

Plus, the VIV development in St. Petersburg, which includes 269 apartment homes, reached substantial completion on September 30, 2025, and leasing started in October. This means the Q4 2025 revenue will see another significant jump as that asset begins generating income. The shift from construction spending to rental income is the most important trend here.

To put the growth in perspective, here are the year-to-date revenue numbers for the nine months ended September 30:

Profitability Metrics

You need to look past the surface-level losses at Belpointe PREP, LLC (OZ) and understand the profitability story is still one of a development-stage company. The headline numbers for the nine months ended September 30, 2025, show a clear lack of traditional profitability, but this is expected as assets transition from construction to rent-generating operations.

The core takeaway is that Belpointe PREP, LLC (OZ) is deeply unprofitable by traditional metrics, which is a near-term risk. For the nine months through Q3 2025, the company reported total revenue of $6.12 million, but a net loss of $(28.4) million. Here's the quick math: that translates to a Net Profit Margin of approximately -464%. Simply put, for every dollar of revenue brought in, the company lost over four dollars. This is defintely a red flag if you ignore the context.

The negative margins are a direct result of the company's operational phase and high cost structure, especially financing. The Gross Profit Margin, which measures operational efficiency before overhead, is deeply negative. Based on the 2024 fiscal year, the Gross Profit was -$4.164 million on $2.675 million in revenue, resulting in a -155.7% Gross Margin. This trend continues in 2025 as the Cost of Revenue (property expenses) outpaces new rental income during the lease-up phase.

Operational efficiency is currently being crushed by two factors: the ramp-up of new properties and soaring interest expense. Operating Profit (Earnings Before Interest and Tax, or EBIT) is also highly negative. The substantial increase in debt, including the refinancing of the Aster & Links project, drove the Year-to-Date (YTD) Interest Expense to $12.1 million through Q3 2025, more than double the prior year's period. This high cost of capital is the single biggest drag on the bottom line right now.

• Gross Margin: Deeply negative, reflecting development costs exceeding initial rents.
• Operating Margin: Highly negative, burdened by property expenses and G&A.
• Net Margin: -464% YTD 2025, driven by massive interest and depreciation.

Profitability Trends and Industry Comparison

The trend over time shows significant revenue growth but an even faster increase in losses. YTD revenue jumped from $1.58 million in 2024 to $6.12 million in 2025, reflecting properties like VIV coming online in St. Petersburg, Florida. But the YTD Net Loss also widened from $(15.6) million to $(28.4) million. This is the classic profile of a real estate developer: assets are being completed, but the associated costs (depreciation and amortization of $5.7 million YTD 2025) and financing costs hit the income statement before the full rental income stream is stabilized.

When you compare Belpointe PREP, LLC (OZ) to the industry, the contrast is stark. Successful, stabilized real estate developers typically target a Gross Profit Margin between 10% and 20% and a Net Profit Margin between 8% and 15%. Belpointe PREP, LLC (OZ)'s margins are in the negative triple digits, which is a major deviation. However, this is the trade-off for the Opportunity Zone (OZ) structure, where the focus is on long-term asset appreciation and tax-free capital gains after a 10-year hold, not immediate cash flow and net income. The profitability will only normalize once the portfolio is fully leased and debt is managed, which is still a work in progress. For a deeper look at who is betting on this long-term view, you should be Exploring Belpointe PREP, LLC (OZ) Investor Profile: Who's Buying and Why?

Debt vs. Equity Structure

Belpointe PREP, LLC (OZ) is currently operating with a strategic, but rapidly increasing, debt load to fuel its development pipeline, which is typical for a growth-focused real estate company. As of November 2025, the company's Debt-to-Equity (D/E) ratio stood at approximately 0.80, marking a significant increase from prior years as major projects move into the construction and stabilization phases. This ratio is a key indicator that for every dollar of shareholder equity, the company uses 80 cents of debt to finance its assets.

To be fair, this leverage is still below the industry benchmark for Multi-Family Residential REITs, which averages around 0.932, and for Real Estate Development companies, which sits closer to 0.9812 as of early 2025. This suggests Belpointe PREP, LLC (OZ) is using debt conservatively relative to its peers, but you must note the jump from the 2024 D/E ratio of 0.60. The company has a stated long-term goal to keep its debt-to-asset ratio between 50% and 70%, showing a clear, aggressive strategy to use leverage for higher return on equity.

The company's approach to financing its growth is a clear balancing act between debt and equity, prioritizing debt in the near term to fund its Qualified Opportunity Zone (QOZ) projects. The most concrete example of this strategy is the recent refinancing activity. In October 2025, Belpointe PREP, LLC (OZ) closed on a major refinance transaction for approximately $204.14 million for its flagship Aster & Links development in Sarasota, Florida. This move was not an issuance of new capital for a new project, but a post-construction financing to:

• Refinance existing construction debt.
• Support the continued lease-up and stabilization of the property.
• Save the company an estimated multiple millions of dollars per year.

This refinance is a strong signal that the company is moving from high-cost construction financing to more stable, long-term debt, which is defintely a positive for cash flow. While the long-term debt is clearly growing, the short-term liquidity picture provides some reassurance. The Quick Ratio for November 2025 was 0.71 and the Current Ratio was 0.84. These ratios, which measure the ability to cover short-term liabilities with short-term assets, are below the ideal 1.0, but for a real estate developer with significant long-term assets, the focus remains on the long-term debt structure.

Here's the quick math on the shift in leverage:

The takeaway here is that Belpointe PREP, LLC (OZ) is executing its plan to increase leverage to maximize returns, but is doing so within a range that remains conservative compared to the broader real estate development sector. For a deeper dive into who is investing in this strategy, you should check out Exploring Belpointe PREP, LLC (OZ) Investor Profile: Who's Buying and Why?

Liquidity and Solvency

You need to know if Belpointe PREP, LLC (OZ) can cover its near-term obligations, and the current picture is tight, but typical for a development-focused real estate entity. The company's liquidity ratios are below the 1.0 benchmark, meaning current assets don't fully cover current liabilities, but the slight upward trend is a positive sign as properties transition to operations.

Current and Quick Ratios: A Tight Liquidity Position

As of the most recent data (November 2025), Belpointe PREP, LLC (OZ)'s liquidity positions are lean. The Current Ratio, which measures the ability to pay short-term liabilities with short-term assets, stands at 0.84. This means for every dollar of current liability, the company has only 84 cents of current assets to cover it. The Quick Ratio (or acid-test ratio), which excludes less-liquid assets like inventory (though less relevant for a pure REIT, it excludes certain assets), is even tighter at 0.71.

• Current Ratio: 0.84 (Slightly up from 0.82 in FY 2024).
• Quick Ratio: 0.71 (Slightly up from 0.70 in FY 2024).
• The ratios are below 1.0, which is common for real estate developers who carry significant short-term debt and development costs.

The good news is that both ratios show a marginal improvement from the fiscal year 2024 figures, indicating a slight strengthening in the near-term financial footing as assets start coming online. You can dive deeper into the ownership structure and long-term strategy by Exploring Belpointe PREP, LLC (OZ) Investor Profile: Who's Buying and Why?

Analysis of Working Capital Trends

Working capital (current assets minus current liabilities) is negative, or very close to zero, which is directly reflected in the sub-1.0 current ratio. The trend, however, is shifting from a pure development focus to an operational one, which should improve working capital over time. The company is actively moving assets from 'construction in progress' to income-generating operating real estate, such as the $180.8 million reclassification of the VIV property in Q3 2025. This shift should eventually drive positive operating cash flow, which is the real engine for sustainable working capital improvement.

Here's the quick math: A Current Ratio of 0.84 means that for every dollar of current liabilities, working capital is negative 16 cents (1.00 - 0.84). This is a structural feature of the business model right now, not necessarily a sign of imminent failure, but it definitely bears watching.

Cash Flow Statements Overview

The cash flow statement for the trailing twelve months (TTM) ended June 30, 2025, shows the company's heavy investment phase is ongoing, requiring significant external funding to bridge the gap. This is a classic growth-stage profile.

The company is funding its development (Investing Cash Flow) with external capital (Financing Cash Flow), which is expected. The key is that the Operating Cash Flow is still negative, but this should flip as properties like VIV in St. Petersburg ramp up rental revenue, which rose to $2.38 million in Q3 2025.

Potential Liquidity Concerns or Strengths

The primary strength is the cash on hand and the structure of the business. As of Q3 2025, the company had $29.6 million in cash and equivalents, plus restricted cash for a total of $35.8 million. This provides a buffer. The main concern is the reliance on financing activities to cover the operating and investing deficits. The company's liquidity covenants require at least $10.0 million in liquid assets, which it currently meets comfortably. Still, the negative operating cash flow means the company must defintely execute its lease-up strategy quickly to reduce its dependence on capital markets.

Next step: Portfolio Manager: Model a sensitivity analysis on OCF based on a 12-month lease-up schedule for the newly completed VIV property by next Tuesday.

Valuation Analysis

You want to know if Belpointe PREP, LLC (OZ) is overvalued or undervalued, and the quick takeaway is that traditional metrics suggest a complex, arguably discounted, picture that maps to its current phase as a development-focused Qualified Opportunity Fund (QOF).

The company is transitioning from construction to operations, so its current valuation ratios reflect negative earnings, but its Net Asset Value (NAV) tells a different story. One source suggests the stock is trading at only 0.55x NAV, which signals a significant discount to the underlying asset value.

Key Valuation Multiples

Looking at the trailing twelve months (TTM) data, the ratios are negative because the company is still reporting losses as its real estate developments lease up and interest expenses weigh on the bottom line. Here's the quick math on the TTM ratios:

• Price-to-Earnings (P/E): The TTM P/E ratio is approximately -11.80 (or -9.3x in another measure), which is expected for a company with a net loss.
• Enterprise Value-to-EBITDA (EV/EBITDA): This ratio is also negative, sitting at about -45.42, again reflecting negative earnings before interest, taxes, depreciation, and amortization.
• Price-to-Book (P/B) Proxy: The Manager announced a NAV per Class A unit of $116.74 as of June 30, 2025. With the stock price recently closing at $59.51, the market price is roughly half the NAV, suggesting the stock is fundamentally undervalued relative to its assets.

Stock Price and Analyst Sentiment

The stock price trend over the last year shows downward momentum, but it's important to frame that against the broader market and the company's development cycle. The shares last closed at $59.51 on November 18, 2025. Over the past 365 days, the price has moved by about -5.02%, and it has fallen by -9.93% in the last 10 days alone. The 52-week range is wide, from a low of $56.77 to a high of $82.89.

Still, the market is struggling to price the future growth. Analyst coverage is thin, and there is currently no consensus recommendation (Buy, Hold, or Sell) on the security. Some technical models are bearish, classifying it as a 'Sell candidate' as of November 2025, but a real estate analyst recently maintained a neutral stance. The average 2025 price target from some forecasts is significantly lower, at around $22.26, indicating a potential -64.67% fall from the recent price. This wide variance highlights the uncertainty in valuing a QOF that is still in the lease-up phase.

Dividend Policy and Income

If you're looking for current income, you should know that Belpointe PREP, LLC (OZ) does not currently pay a dividend. The dividend yield is 0.0%, and the payout ratio is not applicable due to the negative earnings per share (EPS). This is common for development-stage real estate investment vehicles, as they prioritize reinvesting capital back into their projects to drive asset completion and future revenue growth. For more context on their long-term goals, you can look at their Mission Statement, Vision, & Core Values of Belpointe PREP, LLC (OZ).

What this estimate hides is the potential for future cash flow once major projects like VIV (which reached substantial completion on September 30, 2025) are fully leased and generating stable income. For the first nine months of 2025, the company reported a net loss of $28.4 million, but rental revenue is ramping up, reaching $6.12 million year-to-date. That's a key operational metric to watch.

Here is a snapshot of the core valuation data:

Finance: Track the Q4 2025 earnings release date for the next update on revenue and net loss figures.

Risk Factors

You're looking at Belpointe PREP, LLC (OZ) because of the Opportunity Zone (QOZ) tax benefits, but you must first map the real risks, especially since the company is still in a heavy development phase. The direct takeaway is this: the primary near-term risks are execution risk on their massive pipeline and the weight of their increasing interest expense, which is driving significant net losses.

The company is transitioning from a capital deployment phase to an operational one, which is where the rubber meets the road. For the nine months ended September 30, 2025, the company reported a Net Loss of $28.4 million, up sharply from the prior year, with a Loss per Class A unit of $7.64. This is a development-stage company, so losses are expected, but the burn rate is accelerating.

• Execution Risk: The development pipeline is substantial, with an approximate total project cost of over $1.3 billion. Success hinges entirely on completing these projects-like VIV in St. Petersburg, which recently reached substantial completion, reclassifying $180.8 million to operating real estate-on time and on budget, plus achieving rapid lease-up.
• Financial Leverage and Interest Expense: The company employs significant leverage, targeting 50% to 70% of the greater of cost or fair market value. The recent refinancing of the Aster & Links project, for example, added SOFR-based facilities up to $204.1 million, pushing total Debt, net, to $251.4 million as of September 30, 2025. This debt structure drove Q3 2025 interest expense to $4.8 million, a major contributor to the net loss.
• Regulatory Risk: The entire investment thesis is built on the Qualified Opportunity Zone program. Any adverse changes to the federal QOZ regulations-which are always a possibility-could drastically reduce the tax benefits for investors and impact project feasibility.

Here's the quick math on the financial risks: while year-to-date revenue is up to $6.12 million from increased rental activity, the YTD Net Loss of $28.4 million shows that operating expenses and interest costs are currently far outpacing income. You need to see that revenue number climb dramatically in the next few quarters as new assets come online.

To be fair, management is actively mitigating these risks. The shift of the VIV project to operating real estate is a clear, concrete step toward income generation. Also, the company is defending a legal proceeding related to a disputed mortgage note, which is a necessary action to protect its assets. On the governance front, they've resolved a prior NYSE American non-compliance issue related to the annual meeting, which is defintely a positive for investor confidence. Investors should also be aware of potential dilution risk, as the company has registration statements filed to offer up to $1.5 billion of Class A units.

The long-term strategy is sound-focusing on high-growth markets in QOZs-but the near-term is all about execution. You can read more about their strategic alignment here: Mission Statement, Vision, & Core Values of Belpointe PREP, LLC (OZ).

The table below summarizes the key financial metrics driving these near-term risks, based on the latest Q3 2025 filing.

Next step: Finance: Track the lease-up progress of VIV and Aster & Links against Q4 2025 projections to assess the speed of the revenue ramp.

Growth Opportunities

You're looking for a clear map of where Belpointe PREP, LLC (OZ) is heading, and honestly, the future hinges on converting their development pipeline into cash-flowing properties. The company's growth story isn't about some vague future product; it's about the hard-hat work they are doing right now in high-growth markets. Their core driver is the successful lease-up of their multifamily and mixed-use projects in designated Opportunity Zones (QOFs), which are economically distressed communities that offer preferential tax treatment for investors.

The firm has a massive development pipeline of over 2,500 units across four cities, representing an approximate total project cost exceeding $1.3 billion. That's a serious amount of future rental revenue. The immediate focus is on two key assets: one is already in the lease-up phase, and another is expected to begin leasing in 2025. This transition from construction risk to revenue generation is what will defintely unlock value.

Here's the quick math on the near-term shift: in 2024, Belpointe PREP, LLC reported a net operating loss of nearly $1.5 million, but this is expected to reverse during 2025. Why? Because the momentum from the lease-up of properties like Aster & Links in Sarasota, Florida, is kicking in. To be fair, they still reported a net loss of $8.6 million in the first quarter of 2025, but rental revenue for that quarter was already around $1.7 million, a significant jump from the less than $0.4 million in the same quarter of 2024. The expectation is that 2025 will be the year the operational financials start to turn the corner.

The company's strategic initiatives are all about fueling this development and managing their capital structure efficiently. Just recently, in October 2025, Belpointe PREP, LLC closed on a refinance transaction for the Aster & Links property for approximately $204.14 million. This is smart balance sheet management, giving them flexibility. Also, in Q1 2025, they raised $24 million in construction loans, increasing their total long-term debt to more than $203 million, a necessary step to keep those 2,500 units moving forward.

Their competitive edge isn't just about the real estate; it's the structure. They are the first and only Qualified Opportunity Fund listed on a national securities exchange (NYSE American: OZ), which gives investors liquidity and transparency that private QOFs simply cannot offer. Plus, they are fully integrated, with in-house real estate development, construction, and management expertise. This integration helps them control costs and project timelines, a huge advantage in ground-up construction. You can read more about the foundation of their financial model in Breaking Down Belpointe PREP, LLC (OZ) Financial Health: Key Insights for Investors.

The market is starting to price in this growth, too. As of November 2025, the stock is anticipated to trade within a range of $60.71 to $62.20, with an average annualized price of $60.88. The long-term growth is tied directly to the successful completion and lease-up of their projects, which is why monitoring their quarterly rental revenue is crucial.

• Convert 2,500 units to revenue.
• Monitor Q2-Q4 2025 rental revenue reports.
• Watch for new project announcements or acquisitions.

Here is a snapshot of the operational transition that will drive future earnings: