STOCK TITAN

Hubilu Venture (OTC: HBUV) Q1 revenue jumps but faces going concern risk

Filing Impact
(High)
Filing Sentiment
(Neutral)
Form Type
10-Q

Rhea-AI Filing Summary

Hubilu Venture Corporation reported higher rental revenue but remained unprofitable for the quarter ended March 31, 2026. Rental revenue rose to $593,738 from $383,512 a year earlier as vacancies declined, lifting net operating income to $250,244 from $47,802.

Despite this improvement, the company recorded a net loss of $172,177, though this was smaller than the $322,560 loss a year earlier. Interest expense was heavy at $396,003, contributing to a stockholders’ deficit of $1,934,925 and total liabilities of $25,506,825 against total assets of $23,571,900.

Cash increased to $151,782 and the working capital deficit narrowed to $1,425,714. Management disclosed “substantial doubt” about Hubilu’s ability to continue as a going concern due to recurring losses, negative working capital and limited cash, and is seeking higher occupancy and additional capital to support operations.

Positive

  • None.

Negative

  • Going concern uncertainty: As of March 31, 2026, Hubilu reports recurring losses, a working capital deficit of $1,425,714, cash of $151,782 and an accumulated deficit of $3,030,759, leading management to state that these factors raise substantial doubt about its ability to continue as a going concern.

Insights

Revenue improved, but leverage and going concern risk remain high.

Hubilu Venture grew rental revenue to $593,738, lifting net operating income to $250,244 for the quarter ended March 31, 2026. However, heavy interest expense of $396,003 kept results in a net loss of $172,177.

The balance sheet shows total liabilities of $25,506,825 versus assets of $23,571,900, resulting in a stockholders’ deficit of $1,934,925. Working capital is negative $1,425,714, and cash is only $151,782, highlighting tight liquidity.

Management explicitly states that these conditions raise substantial doubt about the company’s ability to continue as a going concern. Future filings will clarify whether higher occupancy and refinancing efforts materially improve leverage, interest costs and liquidity.

Rental revenue $593,738 For the three months ended March 31, 2026
Net income (loss) ($172,177) For the three months ended March 31, 2026
Net operating income $250,244 For the three months ended March 31, 2026
Interest expense $396,003 For the three months ended March 31, 2026
Cash balance $151,782 As of March 31, 2026
Working capital deficit $1,425,714 As of March 31, 2026
Total liabilities $25,506,825 As of March 31, 2026
Stockholders’ equity (deficit) ($1,934,925) As of March 31, 2026
going concern financial
"These factors raise substantial doubt about the Company’s ability to continue as a going concern."
A going concern is a business that is expected to continue its operations and meet its obligations for the foreseeable future, rather than shutting down or selling off assets. This assumption matters to investors because it indicates stability and ongoing profitability, making the business a more reliable investment. Think of it as believing a restaurant will stay open and serve customers, rather than closing down suddenly.
ASC 606 financial
"The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customer."
A U.S. accounting standard that sets consistent rules for when and how companies record revenue from contracts with customers, focusing on the transfer of promised goods or services. It matters to investors because it affects the timing and amount of reported sales and profit—like deciding whether a contractor can count payment when a job starts, progresses, or finishes—so it improves comparability and helps assess a company's true economic performance.
fair value hierarchy financial
"The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy."
Series 1 preferred stock financial
"Each share of Series 1 preferred stock, is convertible at the option of the holder, into shares of common stock…"
stockholders’ deficit financial
"Total stockholders’ equity (deficit) was ( 1,934,925 ) at March 31, 2026."
Stockholders’ deficit is the situation where a company’s total liabilities exceed its total assets, so the book value attributed to shareholders is negative. Think of it like a household with more outstanding debts than the value of its house and possessions—this can signal past losses or aggressive payouts and raises the risk that shareholders may be wiped out, diluted, or face difficulty when the company needs new financing. Investors watch it as a warning about solvency and long‑term financial health.
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: March 31, 2026

 

OR

 

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to __________

 

Commission File No. 000-55611

 

Hubilu Venture Corporation

(Exact Name of Registrant as Specified in its Charter)

 

Delaware   47-3342387

(State or other Jurisdiction of

Incorporation or Organization)

 

(I.R.S. Employer

Identification No.)

 

205 South Beverly Drive, Suite 205

Beverly Hills, CA

  90212
(Address of Principal Executive Offices)   (Zip Code)

 

Registrant’s telephone number, including area code: (310) 308-7887

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically and posted on its Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§230.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

 

Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

  Large accelerated filer ☐   Accelerated filer ☐
  Non-accelerated filer   Smaller reporting company
      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. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

Yes ☐ No

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
N/A   HBUV   OTC Pink

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: As of May 15, 2026 the number of shares outstanding of the issuer’s sole class of common stock, $0.001 par value per share, is 26,237,125.

 

 

 

 

 

 

TABLE OF CONTENTS

 

PART I – FINANCIAL INFORMATION 3
Item 1. Financial Statements 3
Condensed Consolidated Balance Sheets as of March 31, 2026 (Unaudited) and December 31, 2025 3
Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2026 and 2025 (Unaudited) 4
Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the Three Months Ended March 31, 2026 and 2025 (Unaudited) 5
Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2026 and 2025 (Unaudited) 6
Notes to the Condensed Consolidated Financial Statements (Unaudited) 7
Item 2. Management’s Discussion and Analysis of Financial Conditions and Results of Operations 17
Item 3. Quantitative and Qualitative Disclosures about Market Risk 19
Item 4. Controls and Procedures 19
PART II — OTHER INFORMATION 20
Item 1. Legal Proceedings 20
Item 1A. Risk Factors 20
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 20
Item 3. Defaults Upon Senior Securities 20
Item 4. Mine Safety Disclosures 20
Item 5. Other Information 20
Item 6. Exhibits 20
SIGNATURES 21

 

2

 

 

Part I – FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

HUBILU VENTURE CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

 

   March 31,   December 31, 
   2026   2025 
   (Unaudited)     
ASSETS          
           
Current assets:          
Cash   151,782    52,071 
Accounts receivable   68,462    64,178 
Prepaid Expenses   -    8,330 
Total current assets   220,244    124,579 
           
Real estate:          
Land   15,889,273    15,889,273 
Building and capital improvements   8,754,088    8,738,731 
Less: accumulated depreciation   (1,298,305)   (1,224,813)
Total real estate, net   23,345,056    23,403,191 
           
Security deposits   6,600    6,600 
           
Total assets   23,571,900    23,534,370 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)          
           
Current liabilities:          
Accounts payable   8,513    34,655 
Advanced rents received   19,019    40,189 
Accrued interest   300,901    257,229 
Security deposits payable   186,328    197,568 
Due to related party, current maturities   474,271    474,271 
Mortgages payable, net of debt discounts, current maturities   419,061    1,326,091 
Dividends payable   237,865    231,449 
Total current liabilities   1,645,958    2,561,452 
           
Mortgages payable, related party   997,094    1,017,094 
Mortgages payable, net of debt discounts   22,343,373    21,213,070 
Convertible preferred stock payable   520,400    520,400 
           
Total liabilities   25,506,825    25,312,016 
           
Stockholders’ equity (deficit):          

Common stock, $0.001 par value, 100,000,000 shares authorized, 26,237,125 shares issued and outstanding

   26,237    26,237 
Additional paid-in capital   1,069,597    1,054,699 
Accumulated deficit   (3,030,759)   (2,858,582)
Total stockholders’ equity (deficit)   (1,934,925)   (1,777,646)
           
Total liabilities and stockholders’ equity (deficit)   23,571,900    23,534,370 

 

See accompanying notes to financial statements.

 

3

 

 

HUBILU VENTURE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

   2026   2025 
   For the Three Months Ended 
   March 31, 
   2026   2025 
         
Rental revenue   593,738    383,512 
           
Operating expenses:          
General and administrative   50,526    59,273 
Salaries and benefits   16,500    15,600 
Utilities   15,218    9,276 
Professional fees   25,783    35,224 
Property taxes   73,888    46,600 
Repairs and maintenance   88,087    107,992 
Depreciation   73,492    61,745 
Total operating expenses   343,494    335,710 
           
Net operating income   250,244    47,802 
           
Other income (expense):          
Consulting Income   -      
Interest income   -    107 
Interest expense   (396,003)   (353,842)
Dividends expense   (6,416)   (6,398)
Gain/(Loss) on early extinguishment of debt   (20,002)   (10,229)
Other Income   -      
Total other income (expense)   (422,421)   (370,362)
           
Net Income/(loss)   (172,177)   (322,560)
           
Weighted average common shares outstanding - basic and diluted   26,237,125    26,237,125 
Net loss per common share - basic and diluted   (0.01)   (0.01)

 

See accompanying notes to financial statements.

 

4

 

 

HUBILU VENTURE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

(Unaudited)

 

   Shares   Amount   Capital   Deficit   (Deficit) 
For the Three Months Ended March 31, 2026
                   Total 
           Additional       Stockholders’ 
   Common Stock   Paid-In   Accumulated   Equity 
   Shares   Amount   Capital   Deficit   (Deficit) 
                     
Balance, December 31, 2025  $26,237,125   $26,237   $1,054,699   $(2,858,582)  $    (1,777,646)
                          
Imputed interest   -    -    14,898         14,898 
                          
Net Income/(loss)   -    -         (172,177)   (172,177)
                          
Balance, March 31, 2026   26,237,125   $26,237   $1,069,597   $(3,030,759)  $(1,934,925)

 

For the Three Months Ended March 31, 2025
                   Total 
           Additional       Stockholders’ 
   Common Stock   Paid-In   Accumulated   Equity 
   Shares   Amount   Capital   Deficit   (Deficit) 
                     
Balance, December 31, 2024   26,237,125   $26,237   $994,279   $(2,307,140)  $    (1,286,624)
                          
Imputed interest   -    -    21,973         21,973 
                          
Net Income/(loss)   -    -         (322,560)   (322,560)
                          
Balance, March 31, 2025   26,237,125   $26,237   $1,016,252   $(2,629,700)  $(1,587,211)

 

See accompanying notes to financial statements.

 

5

 

 

HUBILU VENTURE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

   2026   2025 
   For the Three Months Ended 
   March 31 
   2026   2025 
CASH FLOWS FROM OPERATING ACTIVITIES          
Net loss   (172,177)   (322,560)
Adjustments to reconcile net loss to net cash used in operating activities:          
Depreciation   73,492    61,745 
Imputed interest   14,898    21,973 
Cumulative preferred stock dividends payable   6,416    6,398 
Impairment of Investment in Securities          
Amortization of debt discounts   8,136    11,804 
Loss on early extinguishment of debt   20,002    10,229 
Decrease (increase) in current assets:          
Accounts receivable   (4,284)   (29,083)
Prepaid expenses   8,330      
Security deposits   -    - 
Increase (decrease) in current liabilities:          
Accounts payable   (26,142)   35,490 
Advanced rents received   (21,170)   12,323 
Accrued expenses   43,672    7,142 
Security deposits payable   (11,240)   55,693 
           
Net cash provided by operating activities   (60,067)   (128,846)
           
CASH FLOWS FROM INVESTING ACTIVITIES          
Purchase of property and equipment   (15,357)   (65,538)
Purchase of investment at Cost   -      
Net cash used in investing activities   (15,357)   (65,538)
           
CASH FLOWS FROM FINANCING ACTIVITIES          
Proceeds received from mortgages payable   263,089    294,416 
Repayments on mortgages payable   (87,954)   (56,169)
Net cash provided by (used in) financing activities   175,135    238,247 
           
NET CHANGE IN CASH   99,711    43,863 
CASH AT BEGINNING OF PERIOD   52,071    9,799 
CASH AT END OF PERIOD   151,782    53,662 
           
SUPPLEMENTAL INFORMATION:          
Interest paid   321,727    312,923 
Income taxes paid          
           
Non-cash investing and financing transactions:          
Acquistion of properties financed with debt          

 

See accompanying notes to financial statements.

 

6

 

 

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Note 1 – Nature of Business and Significant Accounting Policies

 

Nature of Business

 

Hubilu Venture Corporation (“the Company,” “we,” “our” or “us”) was incorporated under the laws of the state of Delaware on March 2, 2015 and is a publicly traded real estate consulting, asset management and business acquisition company, which specializes in acquiring student housing income properties and development/business opportunities located near within the Los Angeles area. The Company currently owns thirty properties within the Los Angeles area under a total of nine subsidiaries in the form of Limited Liability Companies.

 

Basis of Presentation

 

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and the rules of the Securities and Exchange Commission (SEC). Intercompany accounts and transactions have been eliminated.

 

The unaudited condensed consolidated financial statements of the Company and the accompanying notes included in this Quarterly Report on Form 10-Q are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of the Condensed Consolidated Financial Statements have been included. Such adjustments are of a normal, recurring nature. The Condensed Consolidated Financial Statements, and the accompanying notes, are prepared in accordance with GAAP and do not contain certain information included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025. The interim Condensed Consolidated Financial Statements should be read in conjunction with that Annual Report on Form 10-K. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year.

 

Principles of Consolidation

 

The accompanying consolidated financial statements include the accounts of the following entities, all of which were under common control and ownership at March 31, 2026:

 

    State of    
Name of Entity   Incorporation   Relationship
Hubilu Venture Corporation(1)   Delaware   Parent
Akebia Investments, LLC(2)   Wyoming   Subsidiary
Boabab Investments, LLC(2)   Wyoming   Subsidiary
Elata Investments, LLC(2)   Wyoming   Subsidiary
Kapok Investments, LLC(2)   Wyoming   Subsidiary
Lantana Investments, LLC(2)   Wyoming   Subsidiary
Mopane Investments, LLC(2)   Wyoming   Subsidiary
Sunza Investments, LLC(2)   Wyoming   Subsidiary
Trilosa Investments, LLC(2)   Wyoming   Subsidiary
Zinnia Investments, LLC(2)   Wyoming   Subsidiary

 

  (1) Holding company in the form of a corporation

 

  (2) Wholly-owned subsidiary in the form of a limited liability corporation

 

Use of Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

 

Segment Reporting

 

Under ASC 280, Segment Reporting, operating segments are defined as components of an enterprise where discrete financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”), in deciding how to allocate resources and in assessing performance. The Company operates as a single segment, consisting of its property leasing operations in the Los Angeles area. Therefore, the Company’s Chief Executive Officer, who is also the CODM, makes decisions and manages the Company’s operations based on the consolidated operating segment.

 

7

 

 

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Fair Value of Financial Instruments

 

The Company discloses the fair value of certain assets and liabilities in accordance with ASC 820 – Fair Value Measurement and Disclosures (ASC 820). Under ASC 820-10-05, the FASB establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. This Statement reaffirms that fair value is the relevant measurement attribute. The adoption of this standard did not have a material effect on the Company’s financial statements as reflected herein. The carrying amounts of cash, accounts receivable, accounts payable and accrued expenses reported on the balance sheets are estimated by management to approximate fair value primarily due to the short-term nature of the instruments.

 

Revenue Recognition

 

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customer. Under ASC 606, the Company recognizes revenue from leases with its various tenants under operating leases in accordance with a five-step model in which the Company evaluates the performance obligations in an amount that reflects the consideration which the Company expects to be entitled to receive in exchange for those services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract and (5) recognize revenue when (or as) the entity satisfies a performance obligation.

 

The Company’s sales are predominantly generated from leasing its properties to various tenants under operating leases. These sales contain a single performance obligation, and revenue is recognized on a straight-line basis using the effective interest method, based on the Company’s borrowing rate, over the life of the leases. The Company records adjustments to revenue for incidentals and move out, or janitorial reimbursements in the same period that the related revenue is recorded.

 

8

 

 

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Basic and Diluted Loss Per Share

The basic net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted net loss per common share is computed by dividing the net loss adjusted on an “as if converted” basis, by the weighted average number of common shares outstanding plus potential dilutive securities. For the periods presented, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share. As of March 31, 2026 there were 30,636,970 potentially dilutive shares outstanding. For the three months ended March 31, 2026 and 2025, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

 

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption.

 

Note 2 – Going Concern

 

As shown in the accompanying condensed consolidated financial statements, as of March 31, 2026, the Company has incurred recurring losses from operations resulting in an accumulated deficit of $3,030,759 with negative working capital of $1,425,714 and cash on hand of $151,782, which may not be sufficient to sustain operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management is actively working to increase occupancy rates to increase revenues. In addition, the Company is currently seeking additional sources of capital to fund short term operations. Management believes these factors will contribute to achieving profitability. There can be no assurance that we will be successful in achieving these objectives.

The accompanying condensed consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. These condensed consolidated financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities, that might be necessary should the Company be unable to continue as a going concern.

 

Note 3 – Fair Value of Financial Instruments

 

Under FASB ASC 820-10-5, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value.

 

The Company has cash and debts that must be measured under the fair value standard. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows:

 

Level 1 – Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

 

Level 2 – Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

 

Level 3 – Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.

 

9

 

 

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balances sheet as of March 31, 2026 and December 31, 2025:

 

   Level 1   Level 2   Level 3 
   Fair Value Measurements at March 31, 2026 
   Level 1   Level 2   Level 3 
Assets               
Cash  $151,782   $-   $- 
Total assets   151,782    -    - 
Liabilities               
Due to related party   -    474,271    - 
Mortgages payable, related party   -    997,094    - 
Mortgages payable, net of $364,951 of debt discounts   -    22,762,434    - 
Dividends payable   -    237,865    - 
Convertible preferred stock payable   -    -    520,400 
Total liabilities   -    24,471,664    520,400 
Net asset (liabilities)  $151,782   $(24,471,664)  $(520,400)

 

   Level 1   Level 2   Level 3 
   Fair Value Measurements at December 31, 2025 
   Level 1   Level 2   Level 3 
Assets               
Cash  $52,071   $-   $- 
Total assets   52,071    -    - 
Liabilities               
Due to related party   -    474,271    - 
Mortgages payable, related party   -    1,017,094    - 
Mortgages payable, net of $354,996 of debt discounts   -    22,539,161    - 
Dividends payable   -    231,449    - 
Convertible preferred stock payable   -    -    520,400 
Total liabilities   -    24,261,975    520,400 
Net asset (liabilities)  $-   $(24,261,975)  $(520,400)

 

There were no transfers of financial assets or liabilities between Level 1 and Level 2 inputs for the three months ended March 31, 2026 or the year ended December 31, 2025.

 

Note 4 - Real Estate

 

Acquisitions and Dispositions

 

The Company didn’t acquire, or dispose of any properties during the three months ended March 31, 2026.

 

Schedule of Real Estate

 

The Company’s real estate investments consisted of the following at March 31, 2026 and December 31, 2025:

 

   March 31, 2026   December 31, 2025 
Land  $15,889,273   $15,889,273 
Buildings and capital improvements   8,754,088    8,738,731 
Real estate gross   24,643,361    24,628,004 
Less: Accumulated depreciation   (1,298,305)   (1,224,813)
Total Real estate, net  $23,345,056   $23,403,191 

 

Depreciation and amortization expense totaled $73,492 and $61,745, for the three months ended March 31, 2026 and 2025, respectively.

 

10

 

 

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Summary of Changes in Real Estate Investments

 

The change in the real estate investments is as follows for the three months ended March 31, 2026 and the year ended December 31, 2025:

 

   Three months ended   Year ended 
   March 31, 2026   December 31, 2025 
         
Balance, prior period  $24,628,004   $21,873,855 
Acquisitions:   -    2,335,000 
Real estate investment property, at cost   24,628,004    24,208,855 
Capital improvements   15,357    419,149 
Balance, end of period  $24,643,361   $24,628,004 

 

Note 5 – Security Deposits

 

Security deposits consisted of the $6,600 deposit on the Company’s office lease as of March 31, 2026 and December 31, 2025.

 

Note 6 – Due to Related Party

 

As of March 31, 2026 and December 31, 2025, Jacaranda Investments, Inc., had provided total advances of $474,271. These advances are unsecured and do not carry a contractual interest rate or repayment terms. In connection with these advances, the Company has recorded imputed interest charges of $14,898 and $21,973 for the three months ended March 31, 2026 and 2025, respectively, which was credited to additional paid-in capital.

 

Note 7 – Mortgages Payable, Related Party

 

The Company’s mortgages payable to related parties are as follows:

 

  Principal balance     
  March 31,   December 31,   Stated   Maturity
  2026   2025   Interest Rate   Date
2909 South Catalina Street  $599,594   $599,594    6%  April 20, 2029
1434 W. 22nd Street  $147,500    167,500    8%  December 31, 2029
1650 S. Rimpau Ave  $250,000    250,000    8%  December 31, 2029
   997,094   $1,017,094         

 

On April 10, 2017, Esteban Coaloa loaned the Company $655,000 via an All Inclusive Trust Deed (“AITD”) as part of the purchase of 2909 S. Catalina Street, Los Angeles, CA. This loan is considered a related party loan due to Esteban Coaloa’s preferred stock holding. If converted to common stock at the current share price, the conversion would result in Mr. Coaloa owning > 5% of the Company’s outstanding common stock. This is an interest only note with principal due on April 20, 2029.

 

On March 7, 2025, Jacaranda3 Investments, Inc., loaned the Company $250,000 via a Promissory Note, as part of the purchase of 1650 S. Rimpau Blvd, Los Angeles, CA. This loan is considered a related party loan due to Jacaranda3 Investments, Inc. being owned by David Behrend, our President. This is an interest only note with principal due on December 31, 2029.

 

On June 1, 2025, Jacaranda3 Investments, Inc., loaned the Company $183,200 via a Promissory Note, as part of the purchase of 1434 W. 22nd Street, Los Angeles, CA. This loan is considered a related party loan due to Jacaranda3 Investments, Inc. being owned by David Behrend, our President. This is an interest only note with principal due on December 31, 2029.

 

The Company recognized $16,132 and $8,335 of interest expense on notes payable to related parties for the three months ended March 31, 2026 and 2025, respectively.

 

11

 

 

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Note 8 - Mortgages Payable

 

Mortgages payable consists of the following at March 31, 2026 and December 31, 2025, respectively:

 

   2026   2025   Stated Interest Rate   Maturity Date
   Principal Balance   Stated    
   March 31, December 31,   Interest Rate   Maturity Date
   2026   2025        
3711 South Western Avenue   643,585    643,585    5.000%  December 1, 2029
2115 Portland Street   977,323    979,915    7.250%  July 1,2054
4505 Orchard Avenue   611,260    614,287    4.625%  March 1,2052
3791 S. Normandie Avenue                  
-First Note   584,237    586,849    5.225%  April, 1 2052
-Second Note   150,000    150,000    5.000%  March 1,2029
2029 W. 41st Place   820,000    820,000    6.000%  December 31, 2029
1267 West 38th Street   571,668    574,491    4.975%  June 1, 2051
1618 West 38th Street   635,764    637,598    6.350%  August 1, 2055
4016 Dalton Avenue   575,360    578,201    4.975%  June 1, 2051
1981 Estrella Ave   846,251    850,656    5.225%  June 1, 2051
3912 S. Hill Street   839,000    633,307    6.000%  April 1, 2056
1557 West 29th Street   566,711    569,893    4.975%  June 1, 2051
1650 S Rimpau Blvd   516,167    517,468    7.125%  June 1, 2055
1434 W 22nd Street   508,493    509,684    7.5%|   June 1, 2055
417 W 52nd Street   537,475    472,500    6.115%  February 1, 2056
1460 Exposition Blvd   495,512    468,000    6.065%  February 1, 2056
3408 S. Budlong Street                  
-First Note   571,487    574,640    4.875%  December 1, 2051
-Second Note   120,000    120,000    5.000%  November 1, 2029
3777 Ruthelen Street   670,812    674,135    4.625%  March 1, 2052
1733 W. 37th Place                  
-First Note   583,530    585,117    7.225%  April 1, 2052
-Second Note   100,000    100,000    6.000%  March 31, 2029
1457 W. 35th Street                  
-First Note   712,756    714,615    7.050%  March 1, 2055
-Second Note   115,000    115,000    6.000%  June 30,2029
1460 N. Eastern Avenue                  
-First Note   655,873    657,446    7.450%  April, 1, 2055
-Second Note   305,000    305,000    6.000%  June 30, 2029
4700 S. Budlong Avenue                  
-First Note   718,895    720,781    7.125%  December 1, 2054
-Second Note   199,500    199,500    6.000%  March 31, 2029

 

12

 

  

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

   2026   2025   Stated Interest Rate   Maturity Date
   Principal Balance   Stated    
   March 31, December 31,   Interest Rate   Maturity Date
   2026   2025        
1659 Roosevelt Avenue                  
-First Note   569,800    570,000    6.900%  September 1, 2054
-Second Note   200,000    200,000    6.000%  December 31, 2029
802 E. 25th Street                  
-First Note   511,380    512,961    6.710%  September 1, 2054
-Second Note   150,000    150,000    6.000%  December 31, 2029
1100 W. 48th Street                  
-First Note   479,672    481,353    6.300%  November 1, 2054
-Second Note   200,000    200,000    6.000%  December 31, 2029
3910 Walton Avenue   723,804    725,922    6.650%  September 1, 2054
3910 Wisconsin Street   652,725    655,736    5.225%  March 1, 2052
4021 Halldale Avenue   733,765    736,295    6.575%  October 1, 2052
717 West 42nd Place                  
-First Note   559,392    560,959    6.850%  November 1, 2048
-Second Note   134,968    134,968    6.850%  April 30, 2029
3906 Denker Avenue   620,555    622,290    6.475%  September 1, 2055
4009 Brighton Avenue   679,686    682,996    4.875%  November 1, 2051
4517 Orchard Avenue                  
-First Note   454,077    456,124    5.225%  April 1, 2052
-Second Note   158,000    158,000    5.000%  March 1, 2029
3908 Denker Avenue   595,906    598,749    4.975%  December 1, 2051
1284 W. 38th Street                  
-First Note   608,996    612,136    4.625%  March 1, 2052
-Second Note   188,000    188,000    5.250%  June 30, 2029
Hubilu general loan   275,000    275,000    6.000%  December 1, 2029
Total mortgages payable   23,127,385    22,894,157         
Less: unamortized debt discounts   364,951    354,996         
Mortgages payable, net of discounts   22,762,434    22,539,161         
Less: current maturities   419,061    1,326,091         
Mortgages payable, long-term portion   22,343,373    21,213,070         

 

13

 

 

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

In addition to the mortgages incurred on current period property acquisitions disclosed in Note 4, the Company refinanced the following debts:

 

On January 29, 2026, the first note for 1460 Exposition Blvd. was refinanced for $496,000 with Investor Mortgage Finance, LLC, whose terms of payments due are principal and interest, on unpaid principal at the rate of 6.065% per annum. Principal and interest payable in monthly installments of $2,994.53 or more starting on March 1, 2026, and continuing until the 1st day of February 1, 2056, at which time the entire principal balance together with interest due thereon, shall become due and payable.

 

On February 2, 2026, the first note for 417 W 52nd Street was refinanced for $538,000 with Investor Mortgage Finance, LLC, whose terms of payments due are principal and interest, on unpaid principal at the rate of 6.115% per annum. Principal and interest payable in monthly installments of $3,285.47 or more starting on March 1, 2026, and continuing until the 1st day of February 1, 2056, at which time the entire principal balance together with interest due thereon, shall become due and payable.

 

On March 11, 2026, the first and second notes for 3912 S. Hill Street was refinanced for $839,000 with Investor Mortgage Finance, LLC, whose terms of payments due are principal and interest, on unpaid principal at the rate of 6% per annum. Principal and interest payable in monthly installments of $5,030.23 or more starting on May 1, 2026, and continuing until the 1st day of April 1, 2056, at which time the entire principal balance together with interest due thereon, shall become due and payable.

 

The Company recognized $356,837 and $311,730 of interest expense on notes payable for the three months ended March 31, 2026 and 2025, respectively.

 

Note 9 – Convertible Preferred Stock Payable

 

The Company has authorized 10,000,000 shares of preferred stock, and designated 100,000 and 2,000,000 shares of 5% voting, cumulative convertible Series A (“Series A”) and Series 1 (“Series 1”) preferred stock (collectively, “Preferred Stock”), respectively.

 

The Series A matures on September 30, 2030, and Series 1 matures on September 30, 2029.

 

The Preferred Stock has the following rights and privileges:

 

Voting – The holders of the Preferred Stock shall be entitled to the number of votes equal to the number of shares of common stock into which such shares of Preferred Stock could be converted.

 

Conversion Each share of Series A preferred stock, is convertible at the option of the holder, into shares of common stock, equal to three hundred thirty-three and 33/100 (333 1/3) shares of common stock, calculated by dividing the number of Series A preferred shares by $0.003. The Series A preferred stock is also subject to certain adjustments for dilution, if any, resulting from future stock issuances, including for any subsequent issuance of common stock at a price per share less than that paid by the holders of the preferred stock.

 

Each share of Series 1 preferred stock, is convertible at the option of the holder, into shares of common stock, at the lesser of $0.50 per share or a ten percent (10%) discount to the average closing bid price of the common stock 5 days prior to the notice of conversion. The Series 1 preferred stock is also subject to certain adjustments for dilution, if any, resulting from future stock issuances, including for any subsequent issuance of common stock at a price per share less than that paid by the holders of the preferred stock.

 

Dividends – The holders of the Preferred Stock in preference to the holders of common stock, are entitled to receive dividends at the rate of 5% per annum, in kind, which shall accrue quarterly. Such dividends are cumulative. No such dividends have been declared to date.

 

Liquidation – In the event of any liquidation, dissolution, winding-up or sale or merger of the Company, whether voluntarily or involuntarily, each holder of Preferred Stock is entitled to receive, in preference to the holders of common stock, a per-share amount equal to the original issue price of $1.00 (as adjusted, as defined), plus all declared but unpaid dividends.

 

No shares of Series A preferred stock have been issued to date. Outstanding Series 1 preferred stock is as follows:

 

   Shares   Amount   Dividend
in Arrears
   Total 
                 
Balance, December 31, 2025   520,400   $520,400   $231,449   $751,849 
Dividends accrued   -    -    6,416    6,416 
Balance, March 31, 2026   520,400   $520,400   $237,865   $758,265 

 

Note 10 – Commitments and Contingencies

 

Legal Matters

 

From time to time, the Company may be a party to various legal matters, threatened claims, or proceedings in the normal course of business. Legal fees and other costs associated with such actions are expensed as incurred. The Company assesses, in conjunction with its legal counsel, the need to record a liability for litigation and contingencies. Legal accruals are recorded when and if it is determined that a loss related to a certain matter is both probable and reasonably estimable.

 

15

 

 

HUBILU VENTURE CORPORATION
Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Note 11 – Changes in Stockholders’ Equity (Deficit)

 

Common Stock

 

The Company has authorized 100,000,000 shares of $0.001 par value common stock. As of March 31, 2026, a total of 26,237,125 shares of common stock had been issued. Each holder of common stock is entitled to one vote for each share of common stock held.

 

No shares of common stock were issued during the three months ended, March 31, 2026.

 

Note 12 – Income Taxes

 

The Company accounts for income taxes under FASB ASC 740-10, which requires use of the liability method. FASB ASC 740-10-25 provides that deferred tax assets and liabilities are recorded based on the differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes, referred to as temporary differences.

 

For the three months ended March 31, 2026, and the year ended December 31, 2025, the Company incurred a net operating loss and, accordingly, no provision for income taxes has been recorded. In addition, no benefit for income taxes has been recorded due to the uncertainty of the realization of any tax assets. At March 31, 2026, the Company had approximately $3,335,000 of federal net operating losses. The net operating loss carry forwards, if not utilized, will begin to expire in 2042.

 

Based on the available objective evidence, including the Company’s history of its loss, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets at March 31, 2026 and December 31, 2025, respectively.

 

In accordance with FASB ASC 740, the Company has evaluated its tax positions and determined there are no uncertain tax positions.

 

Note 13 – Segment Reporting

 

ASC Topic 280, “Segment Reporting,” establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker, or group, in deciding how to allocate resources and assess performance.

 

The Company’s Chief Executive Officer has been identified as the chief operating decision maker (“CODM”), who reviews the operating results for the Company as a whole to make decisions about allocating resources and assessing financial performance. Accordingly, we determined we operate in a single reporting segment – being a provider of rental properties in a single geographic area.

 

As of March 31, 2026, the Company’s total real estate, net of accumulated depreciation, was $23,345,056. All of the Company’s properties are located in Los Angeles, CA. When evaluating the Company’s performance and making key decisions regarding resource allocation the CODM reviews several key metrics, which include the following:

 

   For the   For the 
   Three Months Ended   Three Months Ended 
   March 31,   March 31, 
   2026   2025 
         
Rental revenue  $593,738   $383,512 
Depreciation  $73,492   $61,745 
Other operating expenses  $270,002   $273,965 
Net operating income  $250,244   $47,802 
Interest expense  $396,003   $353,842 
Other expenses   26,418    16,520 
Net income (loss)  $(172,177)  $(322,560)

 

The key measures of segment profit or loss reviewed by our CODM are rental revenues, depreciation on properties, and interest expenses. The CODM reviews rental revenue to measure and monitor stockholder value and determine the most effective strategy of real estate investment. Depreciation and interest expenses are reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to fund operations. The CODM also reviews other general and administrative costs to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget.

 

Note 14 - Subsequent Events

 

On April 1, 2026, Hubilu vacated there office located in Beverly Hills, CA. Their new mailing address is 333 Washington Blvd. #704, Marina Del Rey, CA 90292.

 

16

 

 

Item 2. Management’s Discussion and Analysis of Financial Conditions and Results of Operations

 

You should read the following discussion of our financial condition and results of operations in conjunction with the condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q and with our audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025. In addition to historical condensed financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements.

 

Overview

 

We were incorporated under the laws of the state of Delaware on March 5, 2015, and are a real estate consulting, asset management and business acquisition company, which specializes in acquiring student housing income properties and development/business opportunities located near within the Los Angeles area.

 

Due to high demand for houses from students, non- profit, and for-profit corporate tenants around the USC Campus and neighboring Metro/subway stations, we have focused on acquiring multiple houses, remodeling and renting out. Rents have increased dramatically for houses in our target areas, allowing us to target larger and higher priced houses, while factoring in current interest rates.

With multiple properties within a small radius, we’re able to take advantage of economies of scale and benefit from property management efficiencies. Our focus is to continue acquiring houses and expand rental operations.

We purchased two new properties during the third quarter of 2025, and entered into agreements to acquire two additional properties during the fourth quarter of 2024, bringing our total properties under management to thirty-five. All properties have been purchased in conjunction with various debt financing arrangements.

 

Going Concern Uncertainty

 

As of March 31, 2026, our balance of cash on hand was $151,782, and we had negative working capital of $1,425,714 and an accumulated deficit of $3,030,759. We expect to incur further losses in the development of its business; therefore, we may not have sufficient funds to sustain our operations for the next twelve months and we may need to raise additional cash to fund our operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. In the event revenues do not materialize at the expected rates, management would seek additional financing and would attempt to conserve cash by further reducing expenses. There can be no assurance that we will be successful in achieving these objectives.

 

The condensed consolidated financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company’s ability to continue as a going concern. The condensed consolidated financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. Our ability to acquire new properties and increase revenues is largely dependent on our success in raising additional capital.

 

17

 

 

Results of Operations for the Three Months Ended March 31, 2026 and 2025

 

The following table summarizes selected items from the statement of operations for the three months ended March 31, 2026 and 2025, respectively.

 

   For the Three Months Ended    
   March 31,   Increase/  
   2026   2025   (Decrease) 
             
Rental revenue   593,738    383,512    210,226 
                
Operating expenses:               
General and administrative   50,526    59,273    (8,747)
Salaries and benefits   16,500    15,600    900 
Utilities   15,218    9,276    5,942 
Professional fees   25,783    35,224    (9,441)
Property taxes   73,888    46,600    27,288 
Repairs and maintenance   88,087    107,992    (19,905)
Depreciation   73,492    61,745    11,747 
Total operating expenses   343,494    335,710    7,784 
                
Net operating income   250,244    47,802    202,442 
                
Other income (expense):               
Consulting Income   -         - 
Interest income   -    107    (107)
Interest expense   (396,003)   (353,842)   (42,161)
Dividends expense   (6,416)   (6,398)   (18)
Gain/(Loss) on early extinguishment of debt   (20,002)   (10,229)   (9,773)
Other Income   -         - 
Total other income (expense)   (422,421)   (370,362)   (52,059)
              - 
Net Income/(loss)   (172,177)   (322,560)   150,383 

 

Revenues

 

Our revenues increased to $593,738 for the three months ended March 31, 2026, compared to $383,512 for the three months ended March 31, 2025, an increase of $210,226, or 55%.. The increase is due to having less vacancies this quarter.

 

General and Administrative

 

General and administrative expenses for the three months ended March 31, 2026 was $50,526, compared to $59,273 for the three months ended March 31, 2025, a decrease of $8,747, or 15%. General and administrative expenses decreased primarily due to less administration needs.

 

Salaries and Benefits

 

Salaries and benefits expenses for the three months ended March 31, 2026 was $16,500, compared to $15,600 for the three months ended March 31, 2025, an increase of $900, or 6%. Salaries and benefits increased due to Tracy Black Van Wier’s salary increase.

 

Utilities

 

Utilities expense for the three months ended March 31, 2026 was $15,218, compared to $9,276 for the three months ended March 31, 2025, an increase of $5,942, or 64%.. Utilities expense increased due to less tenants paying the Company for their own utilities.

 

16

 

 

Professional Fees

 

Professional fees expense for the three months ended March 31, 2026 was $25,783, compared to $35,224 for the three months ended March 31, 2025, a decrease of $9,441, or 27%. Professional fees consisted of legal, audit and accounting fees, which decreased primarily due to less accounting fees.

 

Property Taxes

 

Property tax expense for the three months ended March 31, 2026 was $73,888, compared to $46,600 for the three months ended March 31, 2025, an increase of $27,288, or 59%.

 

Repairs and Maintenance

 

Repairs and maintenance expense for the three months ended March 31, 2026 was $88,087, compared to $107,992 for the three months ended March 31, 2025, a decrease of $19,905, or 18%. Repairs and maintenance expense decreased due to less renovations during the current period.

 

Depreciation

 

Depreciation expense for the three months ended March 31, 2026 was $73,492, compared to $61,745 for the three months ended March 31, 2025, an increase of $11,747, or 19%. Depreciation expense increased during the current period due to properties that were purchased in the prior year.

 

Other Income (Expense)

 

Other expense for the three months ended March 31, 2026 was $422,421, compared to $370,362 for the three months ended March 31, 2025, an increase of $52,059, or 14%. During the three months ended March 31, 2026, other expense consisted of $6,416 of dividends expense, $396,003 of interest expense, and a $20,002 loss on early extinguishment of debt related to the refinancing of two of our mortgages. Other expense consisted of $6,398 of dividends expense, $353,842 of interest expense, and a $10,229 loss on early extinguishment of debt related to the refinancing of one of our mortgages during the three months ended March 31, 2025. Other expense increased primarily due to increased interest rates and our loss on early extinguishment of debt incurred during the current period.

 

Net Loss

 

Net loss for the three months ended March 31, 2026 was $172,177, compared to $322,560 for the three months ended March 31, 2025, a decrease of $150,383, or 47%. The decreased net loss was primarily due to increased rental revenues during the current period.

 

Liquidity and Capital Resources

 

The following table summarizes our total current assets, liabilities and working capital as of March 31, 2026 and December 31, 2025.

 

   March 31, 2026   December 31, 2024 
Current Assets  $220,244   $124,579 
           
Current Liabilities  $1,645,958   $2,561,452 
           
Working Capital Deficit  $(1,425,714)  $(2,436,873)

 

As shown in the accompanying condensed consolidated financial statements, as of March 31, 2026, the Company has incurred recurring losses from operations resulting in an accumulated deficit of $3,030,759, with negative working capital of $1,425,714 and cash on hand of $151,782, which may not be sufficient to sustain operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management is actively working to increase occupancy rates to increase revenues. In addition, the Company is currently seeking additional sources of capital to fund short term operations. Management believes these factors will contribute to achieving profitability. The accompanying condensed consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. These condensed consolidated financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities, that might be necessary should the Company be unable to continue as a going concern.

 

17

 

 

Cash Flow

 

Comparison of the Three Months Ended March 31, 2026 and the Three Months Ended March 31, 2025

 

The following table sets forth the primary sources and uses of cash for the periods presented below:

 

   Three Months Ended March 31, 
   2026   2025 
Net cash provided by (used in) operating activities  $(60,067)  $(128,846)
Net cash used in investing activities   (15,357)   (65,538)
Net cash provided by (used in) financing activities   175,135    238,247 
           
Net change in cash  $99,711   $43,863 

 

Net Cash Provided by (Used in) Operating Activities

 

Net cash used in operating activities was $60,067 for the three months ended March 31, 2026, compared to $128,846 of net cash used in operating activities for the three months ended March 31, 2025, a decrease of $68,779, or 53%. The decrease was primarily due to an increased net loss.

 

Net Cash Used in Investing Activities

 

Net cash used in investing activities was $15,357 for the three months ended March 31, 2026, compared to $65,538 for the three months ended March 31, 2025, a decrease of $50,181, or 77%. This decrease was primarily attributable to reduced capital improvement costs incurred during the current period, compared to the prior period.

 

Net Cash Provided by (Used in) Financing Activities

 

Net cash provided by financing activities was $175,135 for the three months ended March 31, 2026, compared to net cash used in financing activities of $238,247 for the three months ended March 31, 2025, a decrease of $63,112, or 26%. Our decreased cash provided in financing activities was primarily due to decreased proceeds received on debt financing received during the current period.

 

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

 

Our financial results are affected by the selection and application of accounting policies and methods. In the three-month period ended March 31, 2026 there were no changes to the application of critical accounting policies disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025.

 

CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS

 

This report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements in this report, other than statements of historical fact, are “forward-looking statements” for purposes of these provisions, including any projections of earnings, revenues or other financial items, any statements of the plans and objectives of our management for future operations, any statements concerning proposed new products or services, any statements regarding the integration, development or commercialization of the business or any assets acquired from other parties, any statements regarding future economic conditions or performance, and any statements of assumptions underlying any of the foregoing. In some cases, forward-looking statements can be identified by the use of terminology such as “may,” “will,” “expects,” “plans,” “anticipates,” “intends,” “seeks,” “believes,” “estimates,” “potential,” “forecasts,” “continue,” or other forms of these words or similar words or expressions, or the negative thereof or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements contained herein are reasonable, there can be no assurance that such expectations or any of the forward-looking statements will prove to be correct, and actual results will likely differ, and could differ materially, from those projected or assumed in the forward-looking statements. Investors are cautioned not to unduly rely on any such forward-looking statements.

 

All subsequent forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Our actual results will likely differ, and may differ materially, from anticipated results. Financial estimates are subject to change and are not intended to be relied upon as predictions of future operating results. All forward-looking statements included in this report are made as of the date hereof and are based on information available to us as of such date. We assume no obligation to update any forward-looking statement. If we do update or correct one or more forward-looking statements, investors and others should not conclude that we will make additional updates or corrections.

 

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

 

The Company is not required to provide the information required by this Item as it is a “smaller reporting company,” as defined in Rule 12b-2 of the Exchange Act.

 

Item 4. Controls and Procedures

 

Evaluation of Disclosure Controls and Procedures

 

We conducted an evaluation, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, who are one in the same, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(f) under the Securities Exchange Act of 1934 as amended (the “Exchange Act”)). Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were not effective.

 

In performing the above-referenced assessment, our management identified the following material weaknesses:

 

  The Company does not have adequate segregation of duties in the handling of their financial reporting. This is caused by a very limited number of personnel.
     
  The Company’s system of internal controls failed to identify multiple journal entries that were identified by the Company’s external auditor.
     
  The Company has no formal control process related to the identification and approval of related party transactions.
     
  The Company’s accounting staff does not have sufficient technical accounting knowledge relating to accounting for income taxes and complex US GAAP matters.

 

We believe the weaknesses and their related risks are not uncommon in a company of our size because of the limitations in the size and number of staff. Due to our size and nature, segregation of all conflicting duties has not always been possible and may not be economically feasible. However, we plan to take steps to enhance and improve the design of our internal control over financial reporting. During the period covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we plan to implement the appointment of additional qualified personnel to address inadequate segregation of duties and implement modifications to our financial controls to address such inadequacies, by the end of our 2026 fiscal year as resources allow.

 

Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

 

Changes in Internal Control Over Financial Reporting

 

During the three-month period ended March 31, 2026, there has been no change in internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

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PART II — OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We may become, from time to time, involved in routine litigation or subject to disputes or claims related to our business activities. We are not currently party to any pending legal proceedings that we believe would, individually or in the aggregate, have a material adverse effect on our financial condition, cash flows or results of operations.

 

Item 1A. Risk Factors

 

The Company is not required to provide the information required by this Item as it is a “smaller reporting company,” as defined in Rule 12b-2 of the Exchange Act.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

None.

 

Item 3. Defaults Upon Senior Securities

 

None.

 

Item 4. Mine Safety Disclosures

 

None.

 

Item 5. Other Information

 

None.

 

Item 6. Exhibits

 

Exhibit   Description of Document
3.1   Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of Form S-1 filed with the Securities and Exchange Commission by Hubilu Venture Corporation on May 21, 2015)
3.2   Certificate of Correction of Certificate of Incorporation (incorporated by reference to Exhibit 3.1a of Form S-1 filed with the Securities and Exchange Commission by Hubilu Venture Corporation on May 21, 2015)
3.3   Bylaws (incorporated by reference to Exhibit 3.2 of Form S-1 filed with the Securities and Exchange Commission by Hubilu Venture Corporation on May 21, 2015)
3.4   Form of Stock Certificate (incorporated by reference to Exhibit 3.3 of Form 8-A12G filed with the Securities and Exchange Commission by Hubilu Venture Corporation on April 21, 2016)
4.1   Certificate of Designations of 5% Voting, Cumulative Convertible Series A Preferred Stock (incorporated by reference to Exhibit 4.1 of Form 10-Q filed with the Securities and Exchange Commission by Hubilu Venture Corporation on November 21, 2016)
4.2   Certificate of Designations of 5% Voting, Cumulative Convertible Series 1 Preferred Stock (incorporated by reference to Exhibit 4.2 of Form 10-Q filed with the Securities and Exchange Commission by Hubilu Venture Corporation on November 21, 2016)
4.3   Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to Exhibit 4.3 of Form 10-K filed with the Securities and Exchange Commission by Hubilu Venture Corporation on April 16, 2024)
10.1   Adjustable Fixed Rate Note Secured by Deed of Trust, dated as of January 27, 2026, among Elata Investments, LLC and Investor Mortgage Finance, LLC
10.2   Adjustable Fixed Rate Note Secured by Deed of Trust, dated as of January 30, 2026, among Elata Investments, LLC and Investor Mortgage Finance, LLC
10.3   Adjustable Fixed Rate Note Secured by Deed of Trust, dated as of March 11, 2026, among Kapok Investments, LLC and Investor Mortgage Finance, LLC
31.1*   Certification of the Chief Executive Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a)
31.2*   Certification of the Chief Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a)
32.1*   Certification of the Chief Executive Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*   Certification of the Chief Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*   Inline XBRL Instance Document
101.SCH*   Inline XBRL Taxonomy Extension Schema
101.CAL*   Inline XBRL Taxonomy Extension Calculation Linkbase
101.DEF*   Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB*   Inline XBRL Taxonomy Extension Label Linkbase
101.PRE*   Inline XBRL Taxonomy Presentation Linkbase
104   Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

*Filed herewith.

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

  HUBILU VENTURE CORPORATION
   
May 26, 2026 /s/ David Behrend
  David Behrend
  Chairman and Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Accounting and Financial Officer)

 

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FAQ

How did Hubilu Venture (HBUV) perform financially in Q1 2026?

Hubilu Venture posted a net loss of $172,177 for Q1 2026. Rental revenue increased to $593,738 from $383,512, boosting net operating income to $250,244, but high interest and dividend expenses kept overall results negative for the quarter.

Did Hubilu Venture (HBUV) improve its revenue in the quarter ended March 31, 2026?

Yes, rental revenue rose to $593,738 in Q1 2026 from $383,512 a year earlier. Management attributes the 55% increase mainly to lower vacancies across its Los Angeles student housing portfolio, which also helped net operating income rise to $250,244.

What is Hubilu Venture’s liquidity position as of March 31, 2026?

Hubilu Venture reported cash of $151,782 and current assets of $220,244 at March 31, 2026. Current liabilities totaled $1,645,958, resulting in a working capital deficit of $1,425,714 and highlighting limited liquidity to fund near-term obligations without additional financing.

Why does Hubilu Venture’s 10-Q mention a going concern risk?

The filing cites recurring operating losses, an accumulated deficit of $3,030,759, negative working capital of $1,425,714 and modest cash of $151,782. Management concludes these factors raise substantial doubt about Hubilu Venture’s ability to continue as a going concern without higher occupancy and new capital.

How leveraged is Hubilu Venture based on its March 31, 2026 balance sheet?

Total liabilities were $25,506,825 versus total assets of $23,571,900 at March 31, 2026. This produced a stockholders’ deficit of $1,934,925, reflecting significant leverage, mainly from mortgages payable and related-party debt that carry substantial interest obligations.

Did Hubilu Venture narrow its net loss compared with Q1 2025?

Yes, the net loss narrowed to $172,177 in Q1 2026 from $322,560 in Q1 2025. Higher rental revenue and net operating income helped reduce the loss, although increased interest expense and refinancing-related charges still outweighed operating improvements.