Elme Communities declares $1.74 liquidation payout
ELME's $1.74-per-share additional distribution is scheduled before its anticipated delisting and intended November 6, 2026 dissolution.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
8-K
Rhea-AI Filing Summary
Elme Communities completed the sales of 3801 Connecticut Avenue and The Kenmore on September 28, 2026, for purchase prices of $55.0 million each, subject to customary adjustments and prorations. After prorations and closing costs, the sales generated aggregate net proceeds of approximately $103.2 million, completing dispositions of all remaining properties.
The board declared an additional liquidating distribution of $1.74 per Common Share, payable October 22, 2026, to shareholders of record October 9, 2026. Aggregate cash liquidating distributions total $16.41 per share, including $14.67 paid in January 2026. Elme anticipates filing Form 25 on October 26 and last NYSE trading on November 5; it intends dissolution effective November 6, 2026.
Before dissolution, Elme intends to transfer its remaining assets and liabilities to a Maryland liquidating trust. Shareholders will automatically receive trust interests proportional to their ownership at the close of business on the last trading day; no action is required. The interests will not trade on an exchange and generally will not be transferable, while Common Shares will be cancelled. Elme estimates approximately $23.3 million in remaining liabilities, costs and expenses and expects to transfer approximately $9.5 million in additional cash reserves for costs that exceed estimates or arise later.
1 point · 0 major0 major · 1 point
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Hollow bars mark forward-looking points. How the balance works
Positive
- Moderate point. Forward-looking: it has not happened yet and may not happen.Additional liquidating distribution: $1.74 per Common Share, payable October 22, 2026.
Negative
- Moderate point. Forward-looking: it has not happened yet and may not happen.Estimated wind-down obligations: approximately $23.3 million, with an additional $9.5 million reserve. 15% of market cap
Filing Explained
For the
8-K Event Classification
6 items: 2.01, 3.01, 5.02, 7.01, 8.01, 9.01
6 items
Item 2.01
Completion of Acquisition or Disposition of Assets
Financial
The company completed a significant acquisition or sale of business assets.
Item 3.01
Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing
Securities
The company received a delisting notice, failed to satisfy a continued-listing rule or standard, or transferred its listing.
Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers
Governance
Key personnel changes including departures, elections, or appointments of directors and executive officers.
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 8.01
Other Events
Other
Voluntary disclosure of events the company deems important to shareholders but not covered by other items.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, or exhibit attachments filed with this report.
Key Figures
3801 Connecticut Avenue purchase price: $55.0 million
The Kenmore purchase price: $55.0 million
Net proceeds from final two property sales: Approximately $103.2 million
+4 more
7 metrics
3801 Connecticut Avenue purchase price
$55.0 million
Sale completed September 28, 2026, subject to customary adjustments and prorations
The Kenmore purchase price
$55.0 million
Sale completed September 28, 2026, subject to customary adjustments and prorations
Net proceeds from final two property sales
Approximately $103.2 million
Aggregate proceeds after prorations and closing costs
Additional liquidating distribution
$1.74 per Common Share
Payable October 22, 2026
Aggregate cash liquidating distributions
$16.41 per Common Share
Includes $14.67 per share paid in January 2026
Estimated remaining liabilities, costs and expenses
Approximately $23.3 million
Wind-down obligations
Additional cash reserves
Approximately $9.5 million
Expected transfer to the Liquidating Trust for excess or additional liabilities, costs or expenses
Key Terms
liquidating distribution, Liquidating Trust, Beneficial Interests, due bills, +1 more
5 terms
liquidating distribution financial
"an additional liquidating distribution of $1.74"
A liquidating distribution is a payment made to shareholders when a company is winding up or selling off its assets, returning the investors’ share of the cash left after debts are paid. Think of it as splitting the proceeds from selling a house: creditors are paid first, then remaining money is handed back to owners; for investors this signals a company is ending operations and affects how much capital they recover and how it’s taxed.
Liquidating Trust financial
"transfer its remaining assets and liabilities to a Maryland liquidating trust"
A liquidating trust is a legal vehicle set up to collect, sell or manage the remaining assets of a company that is winding down and to distribute the proceeds to creditors and other stakeholders. It matters to investors because the trustee controls how quickly assets are converted to cash and how recoveries are divided, so the trust determines the timing and amount of any payouts — think of it like an executor selling a household’s belongings and paying heirs according to a plan.
Beneficial Interests financial
"holders of the beneficial interests of the Liquidating Trust"
due bills financial
"trade with “due bills” representing an assignment of the right"
Due bills are short-term promises to pay for goods or services received earlier but not yet paid for. They act like an IOU, indicating that the buyer owes money to the seller. For investors, due bills matter because they can affect the timing of payments and the true value of a transaction, impacting financial clarity and decision-making.
Form 25 regulatory
"Form 25, or Notification of Removal from Listing"
A Form 25 is an official filing with the U.S. Securities and Exchange Commission used to remove a company's stock or other security from a national exchange list. Investors should care because delisting often means less visibility, lower trading volume and wider price swings—similar to a product moving from a major supermarket to a small local market, which can make buying, selling and valuing the security more difficult.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How much did ELME receive from selling its last two properties?
The sales generated aggregate net proceeds of approximately $103.2 million after prorations and closing costs. Each property had a purchase price of $55.0 million, subject to customary adjustments and prorations.
What is ELME's additional liquidating distribution?
Elme Communities declared an additional distribution of $1.74 per Common Share, payable October 22, 2026, to shareholders of record October 9, 2026.
When does ELME expect to delist and dissolve?
Elme Communities anticipates filing Form 25 on October 26, 2026, and expects November 5, 2026, to be the last NYSE trading day. The company intends voluntary dissolution effective November 6, 2026, following delisting.
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________________________________
FORM 8-K
___________________________________________________
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 28, 2026
| (Exact name of registrant as specified in its charter) | ||
| (State of incorporation) | (Commission File Number) | (IRS Employer Identification Number) | ||||||
(Address of principal executive office) (Zip code)
Registrant’s telephone number, including area code: (202) 774-3200
___________________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.01 Completion of Acquisition or Disposition of Assets.
On September 28, 2026, Elme 3801 Connecticut Ave Trustee LLC, a wholly-owned subsidiary of Elme Communities, a Maryland real estate investment trust (the “Company”), completed its previously announced disposition of 3801 Connecticut Avenue, a 307-unit community located in Washington, DC, for a purchase price of $55.0 million, subject to certain customary adjustments and prorations, pursuant to a purchase and sale agreement, as amended (the “3801 Agreement”), with FPA Multifamily, LLC (“FPA”).
The foregoing description of the 3801 Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the 3801 Agreement, the First Amendment to the 3801 Agreement, the Reinstatement of and Second Amendment to the 3801 Agreement and the Reinstatement of and Third Amendment to the 3801 Agreement, which are filed as Exhibits 10.1, 10.2, 10.3 and 10.4, respectively, to this Current Report on Form 8-K and incorporated by reference herein.
Also on September 28, 2026, Elme Kenmore LLC, a wholly-owned subsidiary of the Company, completed its previously announced disposition of The Kenmore, a 371-unit community located in Washington, DC, for a purchase price of $55.0 million, subject to certain customary adjustments and prorations, pursuant to a purchase and sale agreement, as amended (the “Kenmore Agreement”), with FPA.
The foregoing description of the Kenmore Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Kenmore Agreement, the First Amendment to the Kenmore Agreement, the Reinstatement of and Second Amendment to the Kenmore Agreement and the Reinstatement of and Third Amendment to the Kenmore Agreement, which are filed as Exhibits 10.5, 10.6, 10.7 and 10.8, respectively, to this Current Report on Form 8-K and incorporated by reference herein.
In addition to the 3801 Agreement and the Kenmore Agreement, FPA has previously entered into two other purchase and sale agreements for the purchase of three other Company properties (consisting of a purchase and sale agreement for both Elme Sandy Springs and Elme Marietta which were sold in February 2026 and Riverside Apartments which was sold in September 2026). Each of these purchase and sale agreements, including the 3801 Agreement and the Kenmore Agreement, was negotiated independently and none have been contingent on any other purchase and sale agreement between the parties.
Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.
On September 29, 2026, in connection with its intended dissolution and the cancellation of its common shares of beneficial interest, par value $0.01 per share (the “Common Shares”), described under Item 8.01 below, the Company, in accordance with the authority granted by the Company’s Board of Trustees (the “Board”) pursuant to the Plan of Sale and Liquidation (as defined below), provided notice to the New York Stock Exchange (the “NYSE”) of its intention to voluntarily delist its Common Shares from the NYSE.
The Company anticipates filing a Form 25, or Notification of Removal from Listing, with the Securities and Exchange Commission (the “SEC”) and the NYSE relating to the delisting of the Common Shares on October 26, 2026. The Company anticipates the last day of trading of its Common Shares on the NYSE to be November 5, 2026 and that the Company’s share transfer books will be closed as of 4:00 p.m. (Eastern Time) on such date.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
In connection with the Company’s intended dissolution, the Washington Real Estate Investment Trust Deferred Compensation Plan for Officers, as amended and restated, and the Washington Real Estate Investment Trust Supplemental Executive Retirement Plan #2, will be terminated, and any amounts remaining unpaid under these and other compensation arrangements will be paid on or before the dissolution.
Item 7.01 Other Events.
On September 29, 2026, the Company issued a press release providing an update on its ongoing liquidation activities, including the completion of the sales of its remaining properties, as well as the declaration of an additional liquidating distribution and updates on the anticipated timing of NYSE delisting, establishment of a liquidating trust for purposes of completing the wind-down process and dissolution of the Company. The press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
This information, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to liabilities of that section, and is not incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.
Item 8.01 Other Events.
In accordance with the Plan of Sale and Liquidation approved by the Board on July 30, 2025 and by the shareholders of the Company on October 30, 2025 (the “Plan of Sale and Liquidation”), following delisting from the NYSE as described above, the Company intends to terminate its existence by voluntary dissolution effective November 6, 2026 (the “Effective Time”).
Prior to the Effective Time, the Company intends to transfer all of its remaining assets and liabilities to a Maryland liquidating trust (the “Liquidating Trust”). The purpose of the Liquidating Trust will be to liquidate the assets of the Liquidating Trust and distribute the residual proceeds of such assets to the holders of the beneficial interests of the Liquidating Trust (the “Beneficial Interests”). All of the Beneficial Interests will be held by the shareholders of the Company, with each shareholder of the Company being deemed automatically to have received and hold a percentage of Beneficial Interests in the Liquidating Trust corresponding to such shareholder’s percentage ownership in the Company as of the close of business on the last day of trading of the Common Shares on the NYSE. Shareholders of the Company will not be required to take any action to receive Beneficial Interests in the Liquidating Trust.
Following the transfer of the Company’s assets and liabilities to the Liquidating Trust, subject to certain exceptions related to transfer by will, intestate succession or operation of law, Beneficial Interests in the Liquidating Trust will not be transferable, nor will holders of Beneficial Interests have authority or power to sell or in any other manner dispose of their Beneficial Interests. The Beneficial Interests will not trade on the NYSE or any other exchange. Simultaneously, all of the outstanding Common Shares and certificates representing Common Shares will be automatically cancelled and will thereafter no longer be deemed outstanding. The rights of holders of Beneficial Interests will not be represented by any form of certificate or other instrument.
For a discussion of the tax consequences of the transfer of the Company’s assets to the Liquidating Trust and the deemed distribution of the Beneficial Interests to the shareholders, please see “Material U.S. Federal Income Tax Consequences - Tax Consequences of the Liquidating Trust” beginning on page 76 of the definitive proxy statement filed by the Company with the SEC on September 24, 2025 for the special meeting of shareholders held on October 30, 2025, which is available free of charge through the website maintained by the SEC at http://www.sec.gov or the Company’s website at www.elmecommunities.com. You are urged to consult your own tax advisor to determine the particular tax consequences to you of the transfer of the Company’s assets to the Liquidating Trust and the deemed distribution of Beneficial Interests to the shareholders, including the applicability and effect of any U.S. federal, state and local and foreign tax laws.
Based on guidance previously provided by the SEC in similar circumstances, assuming the Company terminates its existence as described above, the Company anticipates that the Liquidating Trust will be required to file only annual reports on Form 10-K (using the SEC file number of the Company) containing unaudited financial statements, as well as current reports on Form 8-K (also filed using the SEC file number of the Company).
Item 9.01. Financial Statements and Exhibits.
(b) Pro Forma Financial Information.
The following pro forma financial statements reflect the disposition of 3801 Connecticut Avenue and the disposition of The Kenmore, each described above, and the previously reported Riverside disposition and repayment of the Term Loan that occurred on September 14, 2026 and the previously reported Elme Bethesda disposition that occurred on August 11, 2026.
1.Introduction
2.Elme Communities Unaudited Pro Forma Consolidated Statement of Net Assets as of June 30, 2026 (Liquidation Basis) and notes thereto.
3.Elme Communities Unaudited Pro Forma Condensed Consolidated Statement of Changes in Net Assets for the six months ended June 30, 2026 (Liquidation Basis) and notes thereto.
4.Elme Communities Unaudited Pro Forma Condensed Consolidated Statement of Changes in Net Assets for the period from November 1, 2025 to December 31, 2025 (Liquidation Basis) and notes thereto.
5.Elme Communities Unaudited Pro Forma Condensed Consolidated Statement of Operations for the ten months ended October 31, 2025 (Going Concern Basis) and notes thereto.
6.Elme Communities Unaudited Pro Forma Condensed Consolidated Statement of Comprehensive Income (Loss) for the ten months ended October 31, 2025 (Going Concern Basis) and notes thereto.
(d) Exhibits
| Exhibit No. | Description | ||||
| 10.1*§ | Purchase and Sale Agreement for 3801 Connecticut Avenue, dated as of May 5, 2026, by and between Elme 3801 Connecticut Ave Trustee LLC and FPA Multifamily, LLC | ||||
| 10.2 | First Amendment to the Purchase and Sale Agreement for 3801 Connecticut Avenue, dated as of May 6, 2026, by and between Elme 3801 Connecticut Ave Trustee LLC and FPA Multifamily, LLC | ||||
| 10.3 | Reinstatement of and Second Amendment to Purchase and Sale Agreement, dated as of May 7, 2026, by and between Elme 3801 Connecticut Ave Trustee LLC and FPA Multifamily, LLC | ||||
| 10.4 | Reinstatement of and Third Amendment to Purchase and Sale Agreement, dated as of May 8, 2026, by and between Elme 3801 Connecticut Ave Trustee LLC and FPA Multifamily, LLC | ||||
| 10.5*§ | Purchase and Sale Agreement for the Kenmore, dated as of May 5, 2026, by and between Elme Kenmore LLC and FPA Multifamily, LLC | ||||
| 10.6 | First Amendment to the Purchase and Sale Agreement for the Kenmore, dated as of May 6, 2026, by and between Elme Kenmore LLC and FPA Multifamily, LLC | ||||
| 10.7 | Reinstatement of and Second Amendment to the Purchase and Sale Agreement for the Kenmore, dated as of May 7, 2026, by and between Elme Kenmore LLC and FPA Multifamily, LLC | ||||
| 10.8* | Reinstatement of and Third Amendment to the Purchase and Sale Agreement for the Kenmore, dated as of May 8, 2026, by and between Elme Kenmore LLC and FPA Multifamily, LLC | ||||
| 99.1 | Press release issued September 29, 2026 | ||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | ||||
* Certain exhibits and schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished to the Securities and Exchange Commission upon request.
§ Certain portions of this exhibit (indicated by “[***]”) have been redacted pursuant to Regulation S-K Item 601(a)(6).
Forward-Looking and Cautionary Statements
Certain statements in this Current Report are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. Such statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of the Company to be materially different from future results,
performance or achievements expressed or implied by such forward-looking statements. Additional factors which may cause the actual results, performance, or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements include, but are not limited to: the Company’s timeline for delisting its securities from the NYSE; the Company’s ability to transfer its remaining assets and liabilities to the Liquidating Trust and terminate its existence by voluntary dissolution on the terms and timeline anticipated; changes in the amount and timing of the additional liquidating distributions, including from the Liquidating Trust, as a result of known liabilities or contingent costs or expenses that may be higher than anticipated liabilities, costs or expenses, or unknown liabilities, costs or expenses that arise in the future which the Company cannot reasonably estimate at this time; the possibility, mechanics and timing of converting to a liquidating trust or other liquidating entity; the ability of the Board to terminate the Plan of Sale and Liquidation; potential difficulties in running the Company with a small number of employees until the transfer of the Company’s remaining assets and liabilities to the Liquidating Trust; the outcome of legal proceedings that may be instituted against the Company, its trustees and others, including those related to the sale of 19 multifamily assets to an affiliate of Cortland Partners, LLC, and other completed sales and the Plan of Sale and Liquidation; risks relating to the market value of the Common Shares; risks associated with third party contracts containing consent and/or other provisions that may be triggered by the Plan of Sale and Liquidation; whether or not the sale of one or more of the Company’s properties may be considered a prohibited transaction under the Internal Revenue Code of 1986, as amended; the Company’s ability to maintain its status as a real estate investment trust for U.S. federal income tax purposes; the occurrence of any event, change or other circumstances that could give rise to the termination of the Plan of Sale and Liquidation; general economic and market developments and conditions; and volatility and uncertainty in the financial markets.
The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties that affect the Company’s businesses in the “Risk Factors” section of the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other documents filed by the Company from time to time with the SEC. Copies of the documents filed by the Company with the SEC are available free of charge through the website maintained by the SEC at http://www.sec.gov, and are also available, free of charge, on the Company’s website at www.elmecommunities.com. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. While forward-looking statements reflect the Company’s good faith beliefs, they are not guarantees of future performance. The Company undertakes no obligation to update its forward-looking statements or risk factors to reflect new information, future events, or otherwise.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ELME COMMUNITIES | ||||||||||||||||||||
| (Registrant) | ||||||||||||||||||||
| By: | /s/ W. Drew Hammond | |||||||||||||||||||
| (Signature) | ||||||||||||||||||||
| W. Drew Hammond | ||||||||||||||||||||
| Executive Vice President, Chief Financial Officer, Chief Administrative Officer and Treasurer | ||||||||||||||||||||
| September 29, 2026 | ||||||||||||||||||||
| (Date) | ||||||||||||||||||||
ELME COMMUNITIES
INTRODUCTION TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF NET ASSETS,
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS, CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
On November 12, 2025, Elme Communities (“Elme”, “we” or the “Company”) completed the previously announced sale of Elme’s interests in Echo Sub LLC, a Delaware limited liability company (“Echo Sub”), for an aggregate contract sale price of $1.606 billion, subject to customary adjustments (the “Portfolio Sale Transaction”). Immediately prior to the closing of the Portfolio Sale Transaction, Echo Sub owned all the equity interests in the Elme subsidiaries that owned the following 19 multifamily properties (the “Cortland Portfolio”):
1.Cascade at Landmark, 300 Yoakum Parkway, Alexandria, VA 22304
2.Clayborne, 820 South Columbus Street, Alexandria, VA 22314
3.Elme Alexandria, 205 Century Place, Alexandria, VA 22304
4.Bennett Park, 1601 Clarendon Boulevard, Arlington, VA 22209
5.Park Adams, 2000 N Adams Street, Arlington, VA 22201
6.The Maxwell, 4200 North Carlin Springs Road, Arlington, VA 22203
7.The Paramount, 1425 South Eads Street, Arlington, VA 22202
8.The Wellington, 1850 Columbia Pike, Arlington, VA 22204
9.Trove, 1201 South Ross St, Arlington, VA 22204
10.Roosevelt Towers, 500 North Roosevelt Boulevard, Falls Church, VA 22044
11.Elme Dulles, 13690 Legacy Circle, Herndon, VA 20171
12.Elme Herndon, 2511 Farmcrest Drive, Herndon, VA 20171
13.Elme Leesburg, 86 Heritage Way NE, Leesburg, VA 20176
14.Elme Manassas, 10519 Lariat Lane, Manassas, VA 20109
15.The Ashby at McLean, 1350 Beverly Road, McLean, VA 22101
16.Yale West, 443 New York Avenue NW, Washington, DC 20001
17.Elme Druid Hills, 2696 N Druid Hills Rd, Atlanta, GA 30329
18.Elme Cumberland, 8 Cumberland Way SE, Smyrna, GA 30080
19.Elme Eagles Landing, 860 and 900 Rock Quarry Road, Stockbridge, GA 30281
Following the Portfolio Sale Transaction, the Company owned 10 properties, all of which were expected to be sold subject to a Plan of Sale and Liquidation which was approved by the Company’s shareholders on October 30, 2025.
On November 12, 2025, in connection with the closing of the Portfolio Sale Transaction, the Company caused the repayment in full of all indebtedness, liabilities and other obligations under, and terminated, each of (i) the Third Amended and Restated Credit Agreement, dated July 10, 2024, by and among the Company, as borrower, the financial institutions party thereto as lenders, and Wells Fargo Bank, National Association, as administrative agent (the “Revolver”), (ii) the Term Loan Agreement, dated January 10, 2023, as amended by and among the Company, the lenders party thereto, and Truist Bank, as administrative agent (the “Existing Term Loan”), and (iii) the Note Purchase Agreement, dated September 29, 2020, by and among the Company and other parties named therein as purchasers (the “NPA Notes”). On November 12, 2025, also in connection with the closing of the Portfolio Sale Transaction, the Company provided notice to the holders of its 7.25% senior notes due 2028 (the “Senior Notes”, and together with the Revolver, the Existing Term Loan and the NPA Notes, the “Prepaid Indebtedness”). In connection with the redemption of the Senior Notes, on November 12, 2025, the Company caused funds sufficient to pay and discharge the entire indebtedness on the Senior Notes and all other sums payable by the Company under the Indenture to be irrevocably deposited with the Trustee and, accordingly, the Indenture with respect to the Senior Notes was satisfied and discharged, except with respect to those obligations under the Indenture that expressly survive satisfaction and discharge. Also on November 12, 2025, certain indirect subsidiaries of the Company, as borrowers (collectively, the “Borrowers”), and Goldman Sachs Bank USA, as lender (the “Lender”), entered into that certain Loan Agreement (the “Loan Agreement”)
pursuant to which the Lender has made a senior secured term loan of $520.0 million (the “Term Loan”) to the Borrowers, which was secured by first priority mortgages and security interests on all 10 properties that remained under the Company following the closing of the Portfolio Sale Transaction.
As of June 30, 2026, the Company has completed the sale of six of its remaining properties – five of its multifamily properties, Elme Sandy Springs, Elme Marietta, Elme Conyers, Elme Germantown and Elme Watkins Mill, and its remaining office property, Watergate 600 – for aggregate gross proceeds of approximately $294 million.
As previously disclosed in Elme Communities’ Current Report on Form 8-K filed on August 14, 2026, on August 11, 2026, Elme completed the sale of Elme Bethesda for a purchase price of $58.0 million, subject to customary prorations and adjustments (the “Bethesda Disposition”).
As previously disclosed in Elme Communities’ Current Report on Form 8-K filed on September 18, 2026, on September 14, 2026, Elme completed the sale of Elme Riverside Apartments for a purchase price of $250.0 million, subject to customary prorations and adjustments (the “Riverside Disposition”). In connection with the sale, the remaining balance on the Term Loan was paid in full.
As discussed further above, on September 28, 2026, Elme completed the sale of 3801 Connecticut Avenue for a purchase price of $55.0 million, subject to customary prorations and adjustments (the “3801 Connecticut Disposition”), and the sale of The Kenmore for a purchase price of $55.0 million, subject to customary prorations and adjustments (the “Kenmore Disposition”).
The following unaudited pro forma financial information has been derived from and should be read in conjunction with the consolidated financial statements and notes thereto included in Elme Communities' Annual Report on Form 10-K for the twelve months ended December 31, 2025 and Elme Communities' Quarterly Report on Form 10-Q for the six months ended June 30, 2026.
The Unaudited Pro Forma Consolidated Statement of Net Assets as of June 30, 2026 presents consolidated financial information as if the Bethesda Disposition, Riverside Disposition, 3801 Connecticut Disposition and Kenmore Disposition had taken place on June 30, 2026.
The Unaudited Pro Forma Condensed Consolidated Statement of Changes in Net Assets for the six months ended June 30, 2026 presents the pro forma results as if the Bethesda Disposition, Riverside Disposition, 3801 Connecticut Disposition and Kenmore Disposition had taken place on January 1, 2026.
The Unaudited Pro Forma Condensed Consolidated Statement of Changes in Net Assets for the period from November 1, 2025 to December 31, 2025 presents the pro forma results as if the Bethesda Disposition, Riverside Disposition, 3801 Connecticut Disposition and Kenmore Disposition had taken place on November 1, 2025.
The Unaudited Pro Forma Condensed Consolidated Statement of Operations for the ten months ended October 31, 2025 presents the pro forma results of operations as if the disposition of the Cortland Portfolio, Existing Debt Prepayment, New Debt Origination, Bethesda Disposition, Riverside Disposition, 3801 Connecticut Disposition and Kenmore Disposition had each taken place as of January 1, 2025.
The Unaudited Pro Forma Condensed Consolidated Statement of Comprehensive Income (Loss) for the ten months ended October 31, 2025 presents the pro forma results of operations as if the disposition of the Cortland Portfolio, Existing Debt Prepayment, New Debt Origination, Bethesda Disposition, Riverside Disposition, 3801 Connecticut Disposition and Kenmore Disposition had each taken place as of January 1, 2025.
Explanations or details of the pro forma adjustments are in the notes to each of the unaudited consolidated pro forma financial statements.
The unaudited consolidated pro forma financial information is not necessarily indicative of what Elme’s actual results of operations or net assets in liquidation would have been had the transactions been consummated on the dates indicated, nor does it purport to represent Elme’s results of operations, financial position or net assets in liquidation for any future period. The pro forma results of operations for the periods ended October 31, 2025, December 31, 2025 and June 30, 2026 are not necessarily indicative of the operating results for these periods.
ELME COMMUNITIES AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF NET ASSETS
JUNE 30, 2026
(LIQUIDATION BASIS)
(IN THOUSANDS)
| Elme Communities | Bethesda Disposition | Riverside Disposition | 3801 Connecticut Disposition | Kenmore Disposition | Pro Forma | ||||||||||||||||||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||||||||||||||||||||
| Income producing property | $ | 418,000 | $ | (58,000) | (1) | $ | (250,000) | (4) | $ | (55,000) | (7) | $ | (55,000) | (10) | $ | — | |||||||||||||||||||||||||||||||
| Cash, cash equivalents and restricted cash | 41,257 | 2,760 | (3) | 44,057 | (6) | 52,111 | (9) | 51,105 | (12) | 191,290 | |||||||||||||||||||||||||||||||||||||
| Rents and other receivables | 1,153 | (47) | (1) | (490) | (4) | (68) | (7) | (42) | (10) | 506 | |||||||||||||||||||||||||||||||||||||
| Total assets | $ | 460,410 | $ | (55,287) | $ | (206,433) | $ | (2,957) | $ | (3,937) | $ | 191,796 | |||||||||||||||||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||||||||||||||||||||
| Liabilities for estimated costs in excess of estimated receipts during liquidation | $ | 36,614 | $ | (2,538) | (2) | $ | (6,672) | (5) | $ | (2,583) | (8) | $ | (3,467) | (11) | $ | 21,354 | |||||||||||||||||||||||||||||||
| Debt payable | 251,042 | (52,446) | (3) | (198,596) | (6) | — | — | — | |||||||||||||||||||||||||||||||||||||||
| Accounts payable and accrued expenses | 5,098 | (303) | (1) | (1,165) | (4) | (374) | (7) | (470) | (10) | 2,786 | |||||||||||||||||||||||||||||||||||||
| Total liabilities | $ | 292,754 | $ | (55,287) | $ | (206,433) | $ | (2,957) | $ | (3,937) | $ | 24,140 | |||||||||||||||||||||||||||||||||||
| Net assets in liquidation | $ | 167,656 | $ | — | $ | — | $ | — | $ | — | $ | 167,656 | |||||||||||||||||||||||||||||||||||
See accompanying notes to the pro forma consolidated statement of net assets.
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF NET ASSETS
JUNE 30, 2026
(1) Represents the elimination of assets or liabilities, as applicable, associated with the Bethesda Disposition.
(2) Represents the elimination of the costs in excess of estimated receipts associated with the Bethesda Disposition.
(3) Represents the net proceeds of the Bethesda Disposition and the portion used to repay a portion of the Term Loan, comprised of the following (in thousands):
| Estimated Net Proceeds | Adjustment | ||||
| $ | 58,000 | Represents the contract sale price of the Bethesda Disposition | |||
| (2,794) | Net adjustments and costs paid at closing | ||||
| 55,206 | Net proceeds to seller | ||||
| (52,446) | Debt repayment of the Secured Term Loan | ||||
| $ | 2,760 | Net cash proceeds | |||
(4) Represents the elimination of assets or liabilities, as applicable, associated with the Riverside Disposition.
(5) Represents the elimination of the costs in excess of estimated receipts associated with the Riverside Disposition.
(6) Represents the net proceeds of the Riverside Disposition and the portion used to repay the remainder of the Term Loan, comprised of the following (in thousands):
| Estimated Net Proceeds | Adjustment | ||||
| $ | 250,000 | Represents the contract sale price of the Riverside Disposition | |||
| (7,347) | Net adjustments and costs paid at closing | ||||
| 242,653 | Net proceeds to seller | ||||
| (198,596) | Debt repayment of the Secured Term Loan | ||||
| $ | 44,057 | Net cash proceeds | |||
(7) Represents the elimination of assets or liabilities, as applicable, associated with the 3801 Connecticut Disposition.
(8) Represents the elimination of the costs in excess of estimated receipts associated with the 3801 Connecticut Disposition.
(9) Represents the net proceeds of the 3801 Connecticut Disposition, comprised of the following (in thousands):
| Estimated Net Proceeds | Adjustment | ||||
| $ | 55,000 | Represents the contract sale price of the 3801 Connecticut Disposition | |||
| (2,889) | Net adjustments and actual costs paid at closing | ||||
| $ | 52,111 | Net proceeds to seller | |||
(10) Represents the elimination of assets or liabilities, as applicable, associated with the Kenmore Disposition.
(11) Represents the elimination of the costs in excess of estimated receipts associated with the Kenmore Disposition.
(12) Represents the net proceeds of the Kenmore Disposition, comprised of the following (in thousands):
| Estimated Net Proceeds | Adjustment | ||||
| $ | 55,000 | Represents the contract sale price of the Kenmore Disposition | |||
| (3,895) | Net adjustments and actual costs paid at closing | ||||
| $ | 51,105 | Net proceeds to seller | |||
ELME COMMUNITIES AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT
OF CHANGES IN NET ASSETS
(LIQUIDATION BASIS)
(LIQUIDATION BASIS)
(IN THOUSANDS)
(UNAUDITED)
| Elme Communities Six Months Ended June 30, 2026 | Bethesda Disposition | Riverside Disposition | 3801 Connecticut Disposition | Kenmore Disposition | Pro Forma | ||||||||||||||||||||||||||||||||||||||||||
| Net assets in liquidation, beginning of period | $ | 238,915 | $ | (1,854) | $ | (33,700) | $ | (9,930) | $ | (8,141) | $ | 185,290 | |||||||||||||||||||||||||||||||||||
| Changes in net assets in liquidation | |||||||||||||||||||||||||||||||||||||||||||||||
| Liquidation value of income producing property | (64,425) | 2,500 | (1) | 39,500 | (3) | 11,100 | (5) | 9,800 | (7) | (1,525) | |||||||||||||||||||||||||||||||||||||
| Remeasurement of assets and liabilities, net | (6,834) | (646) | (2) | (5,800) | (4) | (1,170) | (6) | (1,659) | (8) | (16,109) | |||||||||||||||||||||||||||||||||||||
| Net decrease in liquidation value | (71,259) | 1,854 | 33,700 | 9,930 | 8,141 | (17,634) | |||||||||||||||||||||||||||||||||||||||||
| Changes in net assets in liquidation | (71,259) | 1,854 | 33,700 | 9,930 | 8,141 | (17,634) | |||||||||||||||||||||||||||||||||||||||||
| Net assets in liquidation, end of period | $ | 167,656 | $ | — | $ | — | $ | — | $ | — | $ | 167,656 | |||||||||||||||||||||||||||||||||||
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED JUNE 30, 2026
(1) Represents the change of liquidation value of the income producing property associated with the Bethesda Disposition.
(2) Represents the remeasurement of assets and liabilities, net associated with the Bethesda Disposition.
(3) Represents the change of liquidation value of the income producing property associated with the Riverside Disposition.
(4) Represents the remeasurement of assets and liabilities, net associated with the Riverside Disposition.
(5) Represents the change of liquidation value of the income producing property associated with the 3801 Connecticut Disposition.
(6) Represents the remeasurement of assets and liabilities, net associated with the 3801 Connecticut Disposition.
(7) Represents the change of liquidation value of the income producing property associated with the Kenmore Disposition.
(8) Represents the remeasurement of assets and liabilities, net associated with the Kenmore Disposition.
ELME COMMUNITIES AND SUBSIDIARIES
UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS
(LIQUIDATION BASIS)
(LIQUIDATION BASIS)
(IN THOUSANDS)
(UNAUDITED)
| Elme Communities for the Period from November 1, 2025 to December 31, 2025 | Bethesda Disposition | Riverside Disposition | 3801 Connecticut Disposition | Kenmore Disposition | Pro Forma | ||||||||||||||||||||||||||||||||||||||||||
| Net assets in liquidation, beginning of period | $ | 1,589,456 | $ | (4,224) | $ | (66,412) | $ | (12,901) | $ | (16,790) | $ | 1,489,129 | |||||||||||||||||||||||||||||||||||
| Changes in net assets in liquidation | |||||||||||||||||||||||||||||||||||||||||||||||
| Liquidation value of income producing property | (46,375) | 700 | (1) | 31,200 | (3) | (600) | (5) | 4,100 | (7) | (10,975) | |||||||||||||||||||||||||||||||||||||
| Remeasurement of assets and liabilities, net | (443) | 1,670 | (2) | 3,597 | (4) | (122) | (6) | (653) | (8) | 4,049 | |||||||||||||||||||||||||||||||||||||
| Net decrease in liquidation value | (46,818) | 2,370 | 34,797 | (722) | 3,447 | (6,926) | |||||||||||||||||||||||||||||||||||||||||
| Liquidating distributions payable | (1,303,723) | — | — | — | — | (1,303,723) | |||||||||||||||||||||||||||||||||||||||||
| Changes in net assets in liquidation | (1,350,541) | 2,370 | 34,797 | (722) | 3,447 | (1,310,649) | |||||||||||||||||||||||||||||||||||||||||
| Net assets in liquidation, end of period | $ | 238,915 | $ | (1,854) | $ | (31,615) | $ | (13,623) | $ | (13,343) | $ | 178,480 | |||||||||||||||||||||||||||||||||||
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS
FOR THE PERIOD FROM NOVEMBER 1, 2025 TO DECEMBER 31, 2025
(1) Represents the change of liquidation value of the income producing property associated with the Bethesda Disposition.
(2) Represents the remeasurement of assets and liabilities, net associated with the Bethesda Disposition.
(3) Represents the change of liquidation value of the income producing property associated with the Riverside Disposition.
(4) Represents the remeasurement of assets and liabilities, net associated with the Riverside Disposition.
(5) Represents the change of liquidation value of the income producing property associated with the 3801 Connecticut Disposition.
(6) Represents the remeasurement of assets and liabilities, net associated with the 3801 Connecticut Disposition.
(7) Represents the change of liquidation value of the income producing property associated with the Kenmore Disposition.
(8) Represents the remeasurement of assets and liabilities, net associated with the Kenmore Disposition.
ELME COMMUNITIES AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE TEN MONTHS ENDED OCTOBER 31, 2025
(GOING CONCERN BASIS)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
| Elme Communities | Disposition of Cortland Portfolio | Existing Debt Prepayment | New Debt Origination | Bethesda Disposition | Riverside Disposition | 3801 Connecticut Disposition | Kenmore Disposition | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Pro Forma | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Real estate rental revenue | $ | 206,360 | $ | (126,584) | (1) | $ | — | $ | — | $ | (4,757) | (2) | $ | (24,579) | (3) | $ | (5,847) | (4) | $ | (6,466) | (5) | $ | 38,127 | |||||||||||||||||||||||||||||||||||||||
| Expenses | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Property operating and maintenance | 49,962 | (28,868) | (1) | — | — | (1,043) | (2) | (5,505) | (3) | (1,586) | (4) | (2,329) | (5) | 10,631 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Real estate taxes and insurance | 26,640 | (16,904) | (1) | — | — | (615) | (2) | (2,932) | (3) | (506) | (4) | (521) | (5) | 5,162 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Property management | 7,494 | (4,787) | (1) | — | — | (181) | (2) | (929) | (3) | (222) | (4) | (246) | (5) | 1,129 | ||||||||||||||||||||||||||||||||||||||||||||||||
| General and administrative expenses | 54,591 | — | — | — | — | — | — | — | 54,591 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | 78,162 | (49,256) | (1) | — | — | (936) | (2) | (8,756) | (3) | (904) | (4) | (1,995) | (5) | 16,315 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Real estate impairment | 111,719 | — | — | — | — | — | — | — | 111,719 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| 328,568 | (99,815) | — | — | (2,775) | (18,122) | (3,218) | (5,091) | 199,547 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Real estate operating loss | (122,208) | (26,769) | — | — | (1,982) | (6,457) | (2,629) | (1,375) | (161,420) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other income (expense) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense | (31,954) | — | 31,954 | (6) | (35,613) | (7) | — | — | — | — | (35,613) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Loss on extinguishment of debt, net | — | — | (45,511) | (8) | — | — | — | — | — | (45,511) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| (31,954) | — | (13,557) | (35,613) | — | — | — | — | (81,124) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss | $ | (154,162) | $ | (26,769) | $ | (13,557) | $ | (35,613) | $ | (1,982) | $ | (6,457) | $ | (2,629) | $ | (1,375) | $ | (242,544) | ||||||||||||||||||||||||||||||||||||||||||||
| Basic net loss per common share: | $ | (1.75) | $ | (2.76) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Diluted net loss per common share: | $ | (1.75) | $ | (2.76) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Weighted average shares outstanding – basic | 88,092 | 88,092 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Weighted average shares outstanding – diluted | 88,092 | 88,092 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
See accompanying notes to the pro forma condensed consolidated statement of operations.
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE TEN MONTHS ENDED OCTOBER 31, 2025
(1) Represents the elimination of income or expenses, as applicable, associated with the Cortland Portfolio.
(2) Represents the elimination of income or expenses, as applicable, associated with Elme Bethesda.
(3) Represents the elimination of income or expenses, as applicable, associated with Elme Riverside.
(4) Represents the elimination of income or expenses, as applicable, associated with 3801 Connecticut Avenue.
(5) Represents the elimination of income or expenses, as applicable, associated with The Kenmore.
(6) Represents the interest expense associated with the Prepaid Indebtedness as if the Prepaid Indebtedness were prepaid as of January 1, 2025
(7) Represents the interest expense, with an assumed interest rate of 6.21%, associated with the Term Loan for the period from January 1, 2025 through October 31, 2025. This rate is the one-month term SOFR of 3.96% on November 12, 2025, plus the current spread of 2.25%. The effect on income of a 0.125% variance in interest rates would result in an increase or decrease of $541.7 thousand for the ten months ended October 31, 2025.
(8) Represents the write-off of unamortized debt costs and prepayment penalties associated with the repayment or satisfaction and discharge, as appropriate, of the Prepaid Indebtedness.
ELME COMMUNITIES AND SUBSIDIARIES
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
FOR THE TEN MONTHS ENDED OCTOBER 31, 2025
(GOING CONCERN BASIS)
(IN THOUSANDS)
| Elme Communities | Disposition of Cortland Portfolio | Existing Debt Prepayment | New Debt Origination | Bethesda Disposition | Riverside Disposition | 3801 Connecticut Disposition | Kenmore Disposition | Pro Forma | |||||||||||||||||||||||||||||||||||||||||||||
| Net loss | $ | (154,162) | $ | (26,769) | $ | (13,557) | $ | (35,613) | $ | (1,982) | $ | (6,457) | $ | (2,629) | $ | (1,375) | $ | (242,544) | |||||||||||||||||||||||||||||||||||
| Other comprehensive income: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Unrealized gain on interest rate hedges | 598 | — | (598) | (1) | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Reclassification of unrealized loss on interest rate derivatives to earnings | 1,698 | — | (1,698) | (1) | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Comprehensive loss | $ | (151,866) | $ | (26,769) | $ | (15,853) | $ | (35,613) | $ | (1,982) | $ | (6,457) | $ | (2,629) | $ | (1,375) | $ | (242,544) | |||||||||||||||||||||||||||||||||||
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
FOR THE TEN MONTHS ENDED OCTOBER 31, 2025
(1) Represents the write-off of comprehensive income associated with the extinguishment of our two interest rate swaps, with an aggregate notional amount of $150.0 million, associated with the Prepaid Indebtedness.
Exhibit 99.1
Elme Communities Provides Update On
Liquidation Activities
Sales of all remaining properties have now been completed
Board approves declaration of $1.74 per share additional liquidating distribution
Delisting from NYSE anticipated to occur in early November 2026
BETHESDA, Md.- September 29, 2026 – Elme Communities (“Elme” or the “Company”) (NYSE: ELME) today provided an update on its ongoing liquidation activities, including the completion of the sales of all of its remaining properties, as well as the declaration of an additional liquidating distribution and updates on the anticipated timing of delisting from the New York Stock Exchange (the “NYSE”), establishment of a liquidating trust for purposes of completing the wind-down process and dissolution of the Company.
Update on Property Sale Activities
As previously disclosed, the Company completed the sale of Riverside Apartments on September 14, 2026 and used a portion of the proceeds from that sale to repay in full all remaining indebtedness, liabilities and other obligations under the Company’s $520 million term loan entered into on November 12, 2025 (the “Term Loan”), which has been terminated.
On September 28, 2026, the Company completed the sale of its final two remaining properties, The Kenmore and 3801 Connecticut Avenue. After satisfaction of prorations and closing costs, the Company received aggregate net proceeds of approximately $103.2 million for these sales. After completing these sales, the Company has now completed the disposition of all of its remaining properties.
Declaration of Additional Liquidating Distribution
Elme also announced today that its Board of Trustees (the “Board”) has approved an additional special liquidating distribution of $1.74 (the “Special Dividend”) per common share of beneficial interest, par value $0.01 per share (“Common Share”). The Special Dividend will be paid on October 22, 2026 to shareholders of record at the close of business on October 9, 2026. This brings the aggregate cash liquidating distributions to $16.41 per Common Share, inclusive of the $14.67 per share paid to shareholders in January 2026. The Special Dividend is being made in accordance with the Company’s voluntary Plan of Sale and Liquidation previously approved by its shareholders.
NYSE Due Bills
Because the payment of the Special Dividend represents more than 25% of the price of a Common Share, the NYSE has advised the Company that the Common Shares will trade with “due bills” representing an assignment of the right to receive the Special Dividend from the record date of October 9, 2026 through the closing of trading on the NYSE on October 22, 2026, which is the payment date and last day of trading before the October 23, 2026 ex-dividend date (this period of time from October 9, 2026 to October 22, 2026 representing the “Dividend Right Period”). Due bills obligate a seller of Common Shares to deliver the Special Dividend payable on such Common Shares to the buyer (the “Dividend Right”).
This means that persons who purchase Common Shares during the Dividend Right Period are entitled to receive the Special Dividend, and persons who sell Common Shares during the Dividend Right Period are not entitled to the Special Dividend. Accordingly, if an investor wishes to receive the Special Dividend, the investor will need to hold their Common Shares through and including the payment date of October 22, 2026. The record date of October 9, 2026 will be used as the date for establishing the due bill tracking of the Dividend Right to the holder of Common Shares.
Due bill obligations are customarily settled between the brokers representing the buyers and the sellers of shares. The Company has no obligation for either the amount of the due bill or the processing of the due bill. Buyers and sellers of the Common Shares should consult their brokers before trading to be sure they understand the effect of NYSE’s due bill procedures.
Anticipated Timing of NYSE Delisting, Establishment of a Liquidating Trust and Company Dissolution
On September 29, 2026, the Company, in accordance with the authority granted by the Board pursuant to the Plan of Sale and Liquidation, provided notice to the NYSE of its intention to voluntarily delist its Common Shares from the NYSE. The Company anticipates filing a Form 25, or Notification of Removal from Listing, with the Securities and Exchange Commission (“SEC”) and the NYSE relating to the delisting of the Common Shares on October 26, 2026. The Company anticipates the last day of trading on the NYSE to be November 5, 2026 and that the Company's share transfer books will be closed as of 4:00 p.m. (Eastern Time) on such date. After payment of the Special Dividend and delisting from the NYSE, the Company will continue the process of winding down as further described below.
In accordance with the Plan of Sale and Liquidation, following delisting from the NYSE as described above, the Company intends to terminate its existence by voluntary dissolution, effective November 6, 2026. Prior to such dissolution, the Company intends to transfer all of its remaining assets and liabilities to a Maryland liquidating trust (the “Liquidating Trust”). The purpose of the Liquidating Trust will be to liquidate the assets of the Liquidating Trust and distribute the residual proceeds of such assets to the holders of the beneficial interests of the Liquidating Trust (the “Beneficial Interests”). All of the Beneficial Interests will be held by the shareholders of the Company, with each shareholder of the Company being deemed automatically to have received and hold a percentage of Beneficial Interests in the Liquidating Trust corresponding to such shareholder’s percentage ownership in the Company as of the close of business on the last day of trading of the Common Shares on the NYSE. Shareholders
of the Company will not be required to take any action to receive Beneficial Interests in the Liquidating Trust. Following the transfer of the Company’s assets and liabilities to the Liquidating Trust, subject to certain exceptions related to transfer by will, intestate succession or operation of law, Beneficial Interests in the Liquidating Trust will not be transferable, nor will holders of Beneficial Interests have authority or power to sell or in any other manner dispose of their Beneficial Interests. Beneficial Interests will not trade on the NYSE or any other exchange. Simultaneously, all of the outstanding Common Shares and certificates representing Common Shares will be automatically cancelled and will thereafter no longer be deemed outstanding. The rights of holders of Beneficial Interests in the Liquidating Trust will not be represented by any form of certificate or other instrument. Based on guidance previously provided by the SEC in similar circumstances, assuming the Company terminates its existence as described above, the Company anticipates that the Liquidating Trust will be required to file only annual reports on Form 10-K (using the SEC file number of the Company) containing unaudited financial statements, as well as current reports on Form 8-K (also filed using the SEC file number of the Company).
After giving effect to the Special Dividend, the Company’s remaining assets (which consist primarily of the net cash proceeds from property sales) are expected to be used to complete the wind-down process and satisfy all remaining liabilities, including Company liabilities, costs and expenses to be satisfied prior to dissolution of the Company and other known liabilities, net costs or expenses expected to be satisfied by the Liquidating Trust during the wind-down process, all of which are currently estimated to be approximately $23.3 million. In addition, the Company currently expects that approximately $9.5 million of additional cash reserves will be transferred to the Liquidating Trust to cover liabilities, costs or expenses that exceed estimated amounts, as well as any unknown or additional liabilities, costs or expenses that may arise prior to completion of the wind-down process. Any amounts remaining in the Liquidating Trust after satisfaction of all remaining liabilities (including any additional liabilities, costs and expenses that may arise during the wind-down process) are expected to be distributed to the holders of Beneficial Interests upon completion of the wind-down process and in connection with termination of the Liquidating Trust. The decision regarding the amount to be retained and transferred to the Liquidating Trust involved a number of judgments and assumptions and no assurance can be made as to when, or whether, the Liquidating Trust will be able to make any additional liquidating distribution(s) to holders of Beneficial Interests or the timing of any such distribution(s). The Company expects FTI Consulting, Inc. to be retained to provide services in connection with completing the wind-down process, including the services of a liquidating trustee. The actual amount and timing of payment of any additional liquidating distribution(s) would be made by the trustee of the Liquidating Trust in its sole discretion.
U.S. Federal Income Tax Consequences
Information regarding the expected U.S. federal income tax consequences of the Special Dividend, any additional liquidating distributions, as well as the Plan of Sale and Liquidation of the Company, are summarized in the Company’s definitive proxy statement, filed with the SEC on September 24, 2025, for the special meeting of shareholders held on October 30, 2025, which is available free of charge through the website maintained by the SEC at http://www.sec.gov or Elme’s website at www.elmecommunities.com. However, the tax treatment described may vary depending on each shareholder’s particular situation.
About Elme Communities
Elme Communities is a Maryland real estate investment trust which currently trades on the New York Stock Exchange under the ticker symbol ELME.
Contact:
Investor Relations
202-774-3200
202-774-3200
Forward-Looking and Cautionary Statements
Certain statements in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. Such statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of Elme to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Additional factors which may cause the actual results, performance, or achievements of Elme to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements include, but are not limited to: Elme’s timeline for delisting its securities from the NYSE; Elme’s ability to transfer its remaining assets and liabilities to the Liquidating Trust and terminate its existence by voluntary dissolution on the terms and timeline anticipated; changes in the amount and timing of the additional liquidating distributions, including from the Liquidating Trust, as a result of known liabilities or contingent costs or expenses that may be higher than anticipated liabilities, costs or expenses, or unknown, liabilities, costs or expenses that arise in the future which Elme cannot reasonably estimate at this time; the possibility, mechanics and timing of converting to a liquidating trust or other liquidating entity; the ability of the Board to terminate the Plan of Sale and Liquidation; potential difficulties in running the Company with a small number of employees until the transfer of the Company’s remaining assets and liabilities to the Liquidating Trust; the outcome of legal proceedings that may be instituted against Elme, its trustees and others, including those related to the sale of 19 multifamily assets to an affiliate of Cortland Partners, LLC, and other completed sales and the Plan of Sale and Liquidation; risks relating to the market value of the Common Shares; risks associated with third party contracts containing consent and/or other provisions that may be triggered by the Plan of Sale and Liquidation; whether or not the sale of one or more of Elme’s properties may be considered a prohibited transaction under the Internal Revenue Code of 1986, as amended; Elme’s ability to maintain its status as a real estate investment trust for U.S. federal income tax purposes; the occurrence of any event, change or other circumstances that could give rise to the termination of the Plan of Sale and Liquidation; general economic and market developments and conditions; and volatility and uncertainty in the financial markets.
The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties that affect Elme’s businesses in the “Risk Factors” section of Elme’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other documents filed by Elme from time to time with the SEC. Copies of the documents filed by Elme with the SEC are available free of charge through the website maintained by the SEC at http://www.sec.gov, and are also available, free of charge, on Elme’s website at www.elmecommunities.com. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. While forward-looking statements reflect Elme’s good faith beliefs, they are not guarantees of future performance. Elme undertakes no obligation to update its forward-looking statements or risk factors to reflect new information, future events, or otherwise.