About Sachem Capital

Sachem Capital Corp. (Sachem) operates as a Connecticut-based real estate finance company. The company specializes in originating, underwriting, funding, servicing, and managing a portfolio of short-term (i.e., three years or less) loans secured by first mortgage liens on real property located primarily in the Northeastern and Southeastern United States and may also be secured with additional collateral, such as other real estate owned by the borrower or its principals, a pledge of the ownership interests in the borrower by the principals thereof, and/or personal guarantees by the principals of the borrower. The company’s typical borrower is a real estate investor or developer who uses the proceeds of the loan to fund its acquisition, renovation, rehabilitation, development and/or improvement of residential or commercial properties and that are held for investment or sale. The mortgaged property may or may not be income producing. The company does not lend to owner-occupants. The company’s loans are referred to in the real estate finance industry as ‘hard money loans’ primarily because they are secured by ‘hard’ (i.e., real estate) assets. The company’s principal place of business is located in Branford, Connecticut and. As of December 31, 2022, the company’s mortgage loan portfolio was spread across 16 states. Business and Growth Strategies The company is targeting larger-value commercial loans with strong, experienced sponsors. Lastly, the company is looking to partner with other small hard money lenders that are undercapitalized in an effort to participate in their loans or to provide them with enterprise capital growing their business, with Sachem having upside economics in the Manager entity. The company’s strategies are to capitalize on opportunities created by the long-term structural changes in the real estate lending market and the continuing lack of liquidity in the commercial and investment real estate markets; take advantage of the prevailing economic environment, current economic, political and social trends that may impact real estate lending, as well as the outlook for real estate in general and particular asset classes; remain flexible to capitalize on changing sets of investment opportunities that may be present in the various points of an economic cycle; increase the size and quality of the company’s mortgage loans and expand its geographic footprint to reduce the company’s exposure to adverse market conditions that have a disproportionate impact on a single asset class or geographic area; maintain the company’s status as a publicly-held company, subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the ‘Exchange Act’), which gives the company immediate access to the public markets for much-needed capital; and continue to operate to qualify as a REIT and for an exemption from registration under the Investment Company Act of 1940, as amended (the ‘Investment Company Act’). In 2022 the company continued to execute on this strategy. Specifically, the company adjusted and refined the company’s business strategy to address changes in the marketplace and the company’s growth to-date. The company continues to strengthen its geographic footprint beyond Connecticut. As of December 31, 2022, the company had loans in 15 other states – California, Florida, Georgia, Maine, Maryland, Massachusetts, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee and Texas. The company continues to expand its presence in these states, as well as seek opportunities in other markets that meet the company’s underwriting and loan criteria. To leverage the company’s expertise in real estate finance and the company’s capital resources, on the one hand, and to capitalize on lending opportunities in specific markets, on the other, the company plans to partner and invest with local ‘hard money’ real estate lenders creating satellite offices under the ‘Sachem’ influence. The company has had preliminary discussions with local lenders in other markets, including Orlando, Florida, Greenwich, Connecticut, Charlotte, North Carolina and Atlanta, Georgia. Real Estate Lending Activities The company’s real estate lending activities involve originating, underwriting, funding, servicing and managing short-term loans (i.e., loans with an initial term of three years or less), secured by first mortgage liens on real estate property held for investment purposes or development. Generally, borrowers use the proceeds from the company’s loans to acquire and/or renovate existing residential (single-, two- or three-family) real estate properties; acquire vacant real estate for development; and purchase and hold income producing properties. The company’s mortgage loans are structured to fit the needs and business plans of the borrowers. Revenue is generated primarily from the interest borrowers pay on the company’s loans and, to a lesser extent, loan fee income generated on the origination and extension of loans. Loan Portfolio As of December 31, 2022, the company’s mortgage loan portfolio included 444 loans. As of December 31, 2022, 272 loans, which accounted for approximately 43.49% of the aggregate outstanding principal balance of the company’s loan portfolio, were secured by properties located in Connecticut; 41 loans, which accounted for approximately 23.45% of the aggregate outstanding principal balance of the company’s loan portfolio, were secured by properties located in Florida; 54 loans, which accounted for approximately 12.85% of the aggregate outstanding principal balance of the company’s loan portfolio, were secured by properties located in New York; 20 loans, which accounted for approximately 4.54% of the aggregate outstanding principal balance of the company’s loan portfolio, were secured by properties located in Massachusetts; 21 loans, which accounted for approximately 4.89% of the aggregate outstanding principal balance of the company’s loan portfolio, were secured by properties located in New Jersey; six loans, which accounted for approximately 2.33% of the aggregate outstanding principal balance of the company’s loan portfolio, were secured by properties located in North Carolina; and eight loans, which accounted for approximately 1.69% of the company’s loan portfolio, were secured by properties located in Maryland. Sales and Marketing The company relies on its senior executive officers and its new marketing department to generate lending opportunities, as well as referrals from existing or former borrowers, brokers, bankers and web-based advertising. Regulation The company is required to comply with certain provisions of, among other statutes and regulations, certain provisions of the Equal Credit Opportunity Act that are applicable to commercial loans, the USA PATRIOT Act, regulations promulgated by the Office of Foreign Asset Control, and federal and state securities laws and regulations. The company relies on the exception set forth in Section 3(c)(5)(C) of the Investment Company Act. Tax Status The company has elected to be taxed as a REIT (real estate investment trust) under the Internal Revenue Code of 1986, as amended. As a result, the company is not subject to Federal or State income taxation at the corporate level to the extent it distributes annually approximately 90% of its REIT taxable income to its shareholders and satisfies certain other requirements. History Sachem Capital Corp. was founded in 2010. The company was incorporated in 2016 as a New York corporation.