0001213900-22-070340 | 10-Q | XBRL Viewer | Chicago Atlantic Real Estate Finance INC

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Document And Entity Information - shares	9 Months Ended
Document And Entity Information - shares	Sep. 30, 2022	Nov. 07, 2022
Document Information Line Items
Entity Registrant Name	CHICAGO ATLANTIC REAL ESTATE FINANCE, INC.
Trading Symbol	REFI
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		17,657,913
Amendment Flag	false
Entity Central Index Key	0001867949
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Document Period End Date	Sep. 30, 2022
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Entity Small Business	false
Entity Emerging Growth Company	true
Entity Shell Company	false
Entity Ex Transition Period	false
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	001-41123
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	86-3125132
Entity Address, Address Line One	420 North Wabash Avenue
Entity Address, Address Line Two	Suite 500
Entity Address, City or Town	Chicago
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60611
City Area Code	(312)
Local Phone Number	809-7002
Title of 12(b) Security	Common Stock, $0.01 par value per share
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes

Consolidated Balance Sheets - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Loans held for investment	$ 331,075,547	$ 196,984,566
Current expected credit loss reserve	(1,497,933)	(134,542)
Loans held for investment at carrying value, net	329,577,614	196,850,024
Cash	9,331,530	80,248,526
Interest receivable	727,279	197,735
Other receivables and assets, net	844,486	874,170
Total Assets	340,480,909	278,170,455
Liabilities
Revolving Loan	53,000,000
Dividend payable	8,435,222	4,537,924
Interest reserve	5,625,979	6,636,553
Management and incentive fees payable	1,347,421	802,294
Related party payable	1,203,030	1,902,829
Accounts payable and other liabilities	716,463	212,887
Total Liabilities	70,328,115	14,092,487
Commitments and contingencies (Note 8)
Stockholders’ equity
Common stock, par value $0.01 per share, 100,000,000 shares authorized at September 30, 2022 and December 31, 2021, respectively, and 17,742,915 and 17,453,553 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively	176,579	173,551
Additional paid-in-capital	268,888,861	264,081,977
Accumulated earnings (deficit)	1,087,354	(177,560)
Total stockholders’ equity	270,152,794	264,077,968
Total liabilities and stockholders’ equity	$ 340,480,909	$ 278,170,455

Consolidated Balance Sheets (Parentheticals) - $ / shares	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Common stock, par value (in Dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	17,742,915	17,453,553
Common stock, shares outstanding	17,742,915	17,453,553

Consolidated Statements of Income (Unaudited) - USD ($)	3 Months Ended		6 Months Ended	9 Months Ended
Consolidated Statements of Income (Unaudited) - USD ($)	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2021	Sep. 30, 2022
Revenues
Interest income	$ 13,795,097	$ 4,141,323	$ 5,295,812	$ 35,478,178
Interest expense	(861,348)	(25,206)	(41,918)	(1,383,172)
Net interest income	12,933,749	4,116,117	5,253,894	34,095,006
Expenses
Management and incentive fees, net	1,347,421			3,266,487
General and administrative expense	1,076,798	13,531	13,531	2,410,151
Organizational expense		35,065	104,291
Provision for current expected credit losses	306,885			1,403,892
Professional fees	348,785			1,649,360
Stock based compensation	84,891			328,356
Total expenses	3,164,780	48,596	117,822	9,058,246
Net Income before income taxes	9,768,969	4,067,521	5,136,072	25,036,760
Income tax expense
Net Income	$ 9,768,969	$ 4,067,521	$ 5,136,072	$ 25,036,760
Earnings per common share:
Basic earnings per common share (in dollars per share) (in Dollars per share)	$ 0.55	$ 0.83	$ 1.4	$ 1.42
Diluted earnings per common share (in dollars per share) (in Dollars per share)	$ 0.55	$ 0.83	$ 1.4	$ 1.41
Weighted average number of common shares outstanding:
Basic weighted average shares of common stock outstanding (in shares) (in Shares)	17,657,913	4,895,694	3,658,310	17,652,367
Diluted weighted average shares of common stock outstanding (in shares) (in Shares)	17,752,290	4,895,694	3,658,310	17,747,612

Consolidated Statements of Equity (Unaudited) - USD ($)	Total	Common Stock	Additional Paid-In-Capital	Accumulated Earnings
Balance at Mar. 29, 2021
Balance (in Shares) at Mar. 29, 2021
Issuance of common stock in connection with sale of unregistered equity securities	100,000	$ 64	99,936
Issuance of common stock in connection with sale of unregistered equity securities (in Shares)		6,427
Balance at Mar. 31, 2021	100,000	$ 64	99,936
Balance (in Shares) at Mar. 31, 2021		6,427
Balance at Mar. 29, 2021
Balance (in Shares) at Mar. 29, 2021
Net income	5,136,072
Balance at Sep. 30, 2021	128,690,634	$ 80,404	124,542,709	4,067,521
Balance (in Shares) at Sep. 30, 2021		8,040,422
Balance at Mar. 31, 2021	100,000	$ 64	99,936
Balance (in Shares) at Mar. 31, 2021		6,427
Issuance of common stock in connection with sale of unregistered equity securities	56,299,744	$ 36,184	56,263,560
Issuance of common stock in connection with sale of unregistered equity securities (in Shares)		3,618,401
Dividends declared on common shares	(1,068,551)			(1,068,551)
Net income	1,068,551			1,068,551
Balance at Jun. 30, 2021	56,399,744	$ 36,248	56,363,496
Balance (in Shares) at Jun. 30, 2021		3,624,828
Issuance of common stock in connection with sale of unregistered equity securities	68,223,369	$ 44,156	68,179,213
Issuance of common stock in connection with sale of unregistered equity securities (in Shares)		4,415,594
Net income	4,067,521			4,067,521
Balance at Sep. 30, 2021	128,690,634	$ 80,404	124,542,709	4,067,521
Balance (in Shares) at Sep. 30, 2021		8,040,422
Balance at Dec. 31, 2021	264,077,968	$ 173,551	264,081,977	(177,560)
Balance (in Shares) at Dec. 31, 2021		17,453,553
Dividends declared on common shares	(7,100,875)			(7,100,875)
Net income	7,803,952			7,803,952
Issuance of common stock in connection with initial public offering and concurrent private placement, net of offering costs, underwriting discounts and commissions	4,481,556	$ 3,028	4,478,528
Issuance of common stock in connection with initial public offering and concurrent private placement, net of offering costs, underwriting discounts and commissions (in Shares)		302,800
Stock-based compensation	121,915		120,940	975
Stock-based compensation (in Shares)		(3,750)
Balance at Mar. 31, 2022	269,384,516	$ 176,579	268,681,445	526,492
Balance (in Shares) at Mar. 31, 2022		17,752,603
Balance at Dec. 31, 2021	264,077,968	$ 173,551	264,081,977	(177,560)
Balance (in Shares) at Dec. 31, 2021		17,453,553
Net income	25,036,760
Balance at Sep. 30, 2022	270,152,794	$ 176,579	268,888,861	1,087,354
Balance (in Shares) at Sep. 30, 2022		17,742,915
Balance at Mar. 31, 2022	269,384,516	$ 176,579	268,681,445	526,492
Balance (in Shares) at Mar. 31, 2022		17,752,603
Dividends declared on common shares	(8,343,576)			(8,343,576)
Net income	7,463,839			7,463,839
Stock-based compensation	122,732		122,525	207
Stock-based compensation (in Shares)		(313)
Balance at Jun. 30, 2022	268,627,511	$ 176,579	268,803,970	(353,038)
Balance (in Shares) at Jun. 30, 2022		17,752,290
Dividends declared on common shares	(8,339,170)			(8,339,170)
Net income	9,768,969			9,768,969
Stock-based compensation	95,484		84,891	10,593
Stock-based compensation (in Shares)		(9,375)
Balance at Sep. 30, 2022	$ 270,152,794	$ 176,579	$ 268,888,861	$ 1,087,354
Balance (in Shares) at Sep. 30, 2022		17,742,915

Consolidated Statements of Equity (Unaudited) (Parentheticals) - $ / shares	3 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022
Statement of Stockholders' Equity [Abstract]
Dividends declared on common shares, per share	$ 0.47	$ 0.47	$ 0.4

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2022
Operating activities
Net income	$ 5,136,072	$ 25,036,760
Adjustments to reconcile net income to net cash provided by operating activities:
Accretion of deferred loan origination fees and other discounts	(276,838)	(2,139,972)
Payment-in-kind interest	(278,079)	(4,096,721)
Provision for current expected credit losses		1,403,892
Amortization of deferred debt issuance costs	41,918	379,644
Stock based compensation		328,356
Changes in operating assets and liabilities:
Interest receivable	(517,026)	(529,544)
Other assets	(84,384)
Other receivables	(13,868)	(172,699)
Interest reserve	6,590,885	(9,940,290)
Escrow payable	800,000
Related party payable	683,842	1,100,201
Management fee payable		545,127
Accounts payable and accrued expenses	159,047	463,075
Net cash provided by operating activities	12,241,569	12,377,829
Cash flows from investing activities
Issuance of and fundings of loans held for investment	(104,174,344)	(134,314,003)
Proceeds from sale of loan held for investment		6,696,777
Principal repayment of loans held for investment	9,582,613	6,892,654
Net cash used in investing activities	(94,591,731)	(120,724,572)
Cash flows from financing activities
Proceeds from sale of common stock	92,546,597	4,505,664
Proceeds from borrowings on revolving loan		53,000,000
Dividends paid	(1,068,551)	(19,874,715)
Payment of debt issuance costs		(177,261)
Payment of deferred offering costs	(485,978)	(23,941)
Net cash provided by financing activities	90,992,068	37,429,747
Change in cash	8,641,906	(70,916,996)
Cash, beginning of period	100,000	80,248,526
Cash, end of period	8,741,906	9,331,530
Supplemental disclosure of non-cash financing and investing activity
Loans acquired for issuance of shares of common stock	31,976,516
Interest reserve withheld from funding of loan	7,501,842	8,929,716
OID withheld from funding of loans		2,180,593
Dividends declared and not yet paid		8,409,628
Supplemental information:
Interest paid during the period		646,278
Income taxes paid during the period

Organization and Description of Business

9 Months Ended

Sep. 30, 2022

Accounting Policies [Abstract]

ORGANIZATION AND DESCRIPTION OF BUSINESS

1. ORGANIZATION AND DESCRIPTION OF BUSINESS

Chicago Atlantic Real Estate Finance, Inc., and its wholly owned subsidiary, Chicago Atlantic Lincoln, LLC (“CAL”) (collectively the “Company”, “we”, or “our”), is a commercial mortgage real estate investment trust (“REIT”) incorporated in the state of Maryland on March 30, 2021. The Company has elected to be taxed as a REIT for United States federal income tax purposes under the Internal Revenue Code of 1986, as amended (the “Code”), commencing with its taxable year ended December 31, 2021. The Company generally will not be subject to United States federal income taxes on its REIT taxable income if it annually distributes to stockholders all of its REIT taxable income prior to the deduction for dividends paid and complies with various other requirements as a REIT.

The Company operates as one operating segment and its primary investment objective is to provide attractive, risk-adjusted returns for stockholders over time, primarily through consistent current income (dividends and distributions) and secondarily, through capital appreciation. The Company intends to achieve this objective by originating, structuring, and investing in first mortgage loans and alternative structured financings secured by commercial real estate properties. The Company’s loan portfolio is primarily comprised of senior loans to state-licensed operators in the cannabis industry, secured by real estate, equipment, receivables, licenses, and/or other assets of the borrowers to the extent permitted by applicable laws and regulations governing such borrowers.

The Company is externally managed by Chicago Atlantic REIT Manager, LLC (the “Manager”), a Delaware limited liability company, pursuant to the terms of the management agreement dated May 1, 2021, as amended in October 2021, which has a three-year initial term set to expire on April 30, 2024 (the “Management Agreement”), by and among the Company and the Manager. After the initial term, the management agreement is automatically renewed for one-year periods unless the Company or the Manager elects not to renew in accordance with the terms of the Management Agreement. The Manager conducts substantially all of the Company’s operations and provides asset management services for its real estate investments. For its services, the Manager is entitled to management fees and incentive compensation, both defined in and in accordance with the terms of the Management Agreement (Note 7). All of the Company’s investment decisions are made by the investment committee of the Manager, subject to oversight by the Company’s board of directors (the “Board”). The Manager is wholly-owned by Chicago Atlantic Group, LLC (the “Sponsor”).

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2022

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements and related notes of the Company have been prepared on the accrual basis of accounting and in conformity with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these financial statements may not contain all disclosures required by generally accepted accounting principles. Reference should be made to Note 2 of the Company’s Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the period ended December 31, 2021. In the opinion of the Company, all normal recurring adjustments have been made that are necessary to the fair statement of the results of operations and financial position as of and for the periods presented. Operating results for the three and nine-month periods ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022.

Use of Estimates in the Preparation of Consolidated Financial Statements

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results could differ from those estimates. Significant estimates include the provision for current expected credit losses.

Reclassifications

Certain prior period amounts have been reclassified to conform to the current period presentation. Interest expense was previously presented as an operating expense and has been reclassified as a reduction to net revenue on the consolidated statements of income. General and administrative expense reimbursements due to the Manager, which were previously included in the line item management and incentive fees payable, have been reclassified into related party payable in the consolidated balance sheets. In addition, other receivables amounts have been reclassified to other receivables and assets, net in the consolidated balance sheets.

These reclassifications do not result in any changes to previously reported total assets and net income.

Investment Payable

Investment transactions are reported on a trade-date basis. Unsettled trades as of the balance sheet date, if any, are included in payable for investments purchased.

Recent Accounting Pronouncements

As of September 30, 2022, the Company is evaluating the potential impact of recently issued accounting pronouncements on its consolidated financial statements.

Loans Held For Investment, Net

9 Months Ended

Sep. 30, 2022

Loans Held For Investment Net Abstract

LOANS HELD FOR INVESTMENT, NET

3. LOANS HELD FOR INVESTMENT, NET

As of September 30, 2022 and December 31, 2021, the Company’s portfolio was comprised of loans to 22 and 21 portfolio companies, respectively, that the Company has the ability and intends to hold the loans to maturity. The portfolio loans are held on the consolidated balance sheet at amortized cost. The Company’s aggregate loan commitments and outstanding principal were approximately $348.9 million and $334.5 million, respectively as of September 30, 2022, and $235.1 million and $200.6 million as of December 31, 2021. During the three and nine months ended September 30, 2022, the Company funded approximately $5.7 million and $143.6 million, respectively, in new loan principal.

As of September 30, 2022 and December 31, 2021, approximately 59.7% and 53.2%, respectively, of the Company’s portfolio was comprised of floating rate loans that pay interest at the prime rate plus an applicable margin, and were subject to prime rate floors. The outstanding principal of these loans was approximately $199.7 million and $106.7 million as of September 30, 2022 and December 31, 2021, respectively.

The remaining 40.3% and 46.8% of the portfolio as of September 30, 2022 and December 31, 2021, respectively, was comprised of fixed rate loans that had outstanding principal of approximately $134.8 million and $93.9 million.

The following tables summarize the Company’s loans held for investment as of September 30, 2022 and December 31, 2021:

			As of September 30, 2022						Weighted Average
	Outstanding Principal (1)		Original Issue Discount			Carrying Value (1)			Remaining Life (Years) (2)
Senior Term Loans	$	334,502,935	$	(3,427,388	)	$	331,075,547		2.1
Current expected credit loss reserve		-		-			(1,497,933	)
Total loans held at carrying value, net	$	334,502,935	$	(3,427,388	)	$	329,577,614

			As of December 31, 2021						Weighted Average
	Outstanding Principal (1)		Original Issue Discount			Carrying Value (1)			Remaining Life (Years) (2)
Senior Term Loans	$	200,632,056	$	(3,647,490	)	$	196,984,566		2.2
Current expected credit loss reserve		-		-			(134,542	)
Total loans held at carrying value, net	$	200,632,056	$	(3,647,490	)	$	196,850,024

(1)	The difference between the Carrying Value and the Outstanding Principal amount of the loans consists of unaccreted original issue discount, deferred loan fees and other upfront fees. Outstanding principal balance includes capitalized PIK interest, if applicable.

(2)	Weighted average remaining life is calculated based on the carrying value of the loans as of September 30, 2022 and December 31, 2021, respectively.

The following tables present changes in loans held at carrying value as of and for the nine months ended September 30, 2022 and the period from March 30, 2021 (inception) to September 30, 2021.

	Principal (1)			Original Issue Discount			Current Expected Credit Loss Reserve			Carrying Value (1)
Balance at December 31, 2021	$	200,632,056		$	(3,647,490	)	$	(134,542	)	$	196,850,024
Issuance of and funding of loans		143,624,312			(2,180,593	)		-			141,443,719
Principal repayment of loans		(6,892,654	)		-			-			(6,892,654	)
Accretion of original issue discount		-			2,139,972			-			2,139,972
Proceeds from sale of loans		(6,957,500	)		260,723			-			(6,696,777	)
PIK Interest		4,096,721			-			-			4,096,721
Current expected credit loss reserve		-			-			(1,363,391	)		(1,363,391	)
Balance at September 30, 2022	$	334,502,935		$	(3,427,388	)	$	(1,497,933	)	$	329,577,614

(1)

The difference between the Carrying Value and the Outstanding Principal amount of the loans consists of unaccreted original issue discount, deferred loan fees and other upfront fees. Outstanding principal balance includes capitalized PIK interest, if applicable.

	Principal (1)			Original Issue Discount			Current Expected Credit Loss Reserve		Carrying Value (1)
Balance at March 30, 2021 (inception)	$	-		$	-		$	-	$	-
Loans contributed		32,589,907			(613,391	)		-		31,976,516
New fundings		105,952,844			(1,778,500	)		-		104,174,344
Principal repayment of loans		(9,582,613	)		-			-		(9,582,613	)
Accretion of original issue discount		-			276,838			-		276,838
Sale of loans		-			-			-		-
PIK Interest		278,079			-			-		278,079
Balance at September 30, 2021	$	129,238,217		$	(2,115,053	)	$	-	$	127,123,164

(1)

A more detailed listing of the Company’s loans held at carrying value based on information available as of September 30, 2022, is as follows:

Loan	Location	Outstanding Principal(1)		Original Issue Premium/ (Discount)			Carrying Value(1)			Contractual Interest Rate(4)	Maturity Date(2)	Payment Terms(3)	Initial Funding Date
1	Various⁽⁶⁾		30,000,000		(287,746	)		29,712,254		10.07%⁽⁷⁾	5/30/2023	I/O	7/2/2020
2	Michigan		36,646,551		(182,125	)		36,464,426		P + 6.65%^(5)(11) Cash, 3.25% PIK	12/31/2024	P&I	3/5/2021
3	Various⁽⁶⁾		20,673,831		(444,457	)		20,229,374		13.91% Cash, 2.59% PIK⁽¹⁰⁾	11/29/2024	P&I	3/25/2021
4	Arizona		11,909,539		-			11,909,539		19.01%⁽⁸⁾	12/31/2023	P&I	4/19/2021
5	Massachusetts		1,500,000		-			1,500,000		P + 12.25%⁽⁵⁾	4/30/2023	P&I	4/19/2021
6	Pennsylvania		13,263,665		-			13,263,665		P + 10.75%⁽⁵⁾ Cash, 4% PIK⁽⁹⁾	5/31/2025	P&I	5/28/2021
7	Michigan		4,443,750		(5,558	)		4,438,192		P + 9.00%⁽⁵⁾	2/20/2024	P&I	8/20/2021
8	Various⁽⁶⁾		23,168,151		(242,929	)		22,925,222		13% Cash, 2.5% PIK	6/30/2025	P&I	8/24/2021
9	West Virginia		9,554,960		(121,586	)		9,433,374		P + 9.25%⁽⁵⁾ Cash, 2% PIK	9/1/2024	P&I	9/1/2021
10	Pennsylvania		15,536,102		-			15,536,102		P + 10.75%⁽⁵⁾ Cash, 3% PIK	6/30/2024	P&I	9/3/2021
11	Michigan		313,607		-			313,607		11.00%	9/30/2024	P&I	9/20/2021
12	Maryland		32,479,495		(714,967	)		31,764,528		P + 8.75%⁽⁵⁾ Cash, 2% PIK	9/30/2024	I/O	9/30/2021
13	Various⁽⁶⁾		20,000,000		(210,110	)		19,789,890		13.00%	10/31/2024	P&I	11/8/2021
14	Michigan		10,600,000		(22,487	)		10,577,513		P + 7.00%⁽⁵⁾	11/22/2022	I/O	11/22/2021
15	Various⁽⁶⁾		5,000,000		-			5,000,000		15% Cash, 2.5% PIK	12/27/2026	P&I	12/27/2021
16	Michigan		3,739,861		(56,096	)		3,683,765		10.50% Cash, 5% PIK	12/29/2023	I/O	12/29/2021
17	Various⁽⁶⁾		7,500,000		(56,267	)		7,443,733		P + 9.25%⁽⁵⁾	12/31/2024	I/O	12/30/2021
18	Florida		15,000,000		(293,989	)		14,706,011		11.00%	1/31/2025	P&I	1/18/2022
19	Ohio		30,602,729		(472,079	)		30,130,650		P + 8.25%⁽⁵⁾ Cash, 3% PIK	2/28/2025	P&I	2/3/2022
20	Florida		20,327,703		(84,518	)		20,243,185		11.00% Cash, 3% PIK	8/29/2025	P&I	3/11/2022
21	Missouri		17,204,978		(148,084	)		17,056,894		11.00% Cash, 3% PIK	5/30/2025	P&I	5/9/2022
22	Illinois		5,038,013		(84,390	)		4,953,623		P + 8.50% Cash, 3%⁽⁵⁾ PIK	6/30/2026	P&I	7/1/2022

Current expected credit loss reserve			-		-			(1,497,933	)
Total loans held at carrying value		$	334,502,935	$	(3,427,388	)	$	329,577,614

(1)

The difference between the Carrying Value and the Outstanding Principal amount of the loans consists of unaccreted original issue discounts, deferred loan fees and other upfront fees. Outstanding principal balance includes capitalized PIK interest, if applicable.

(2)

Certain loans are subject to contractual extension options and may be subject to performance based on other conditions as stipulated in the loan agreement. Actual maturities may differ from contractual maturities stated herein as certain borrowers may have the right to prepay with or without a contractual prepayment penalty. The Company may also extend contractual maturities and amend other terms of the loans in connection with loan modifications.

(3)	P&I = principal and interest. I/O = interest only. P&I loans may include interest only periods for a portion of the loan term.
(4)	P = prime rate and depicts floating rate loans that pay interest at the prime rate plus a specific percentage; “PIK” = paid in kind interest.
(5)	This Loan is subject to prime rate floor.
(6)	Loans with material collateral in multiple jurisdictions, namely multi-state operators, are disclosed as “various.”
(7)	The aggregate loan commitment to Loan #1 includes a $4.005 million initial advance, which has an interest rate of 15.25%, a second advance of $15.995 million, which has an interest rate of 9.75%, and a third advance of $10.0 million, which has an interest rate of 8.50%. The statistics presented reflect the weighted average of the terms under all three advances for the total aggregate loan commitment.
(8)	The aggregate loan commitment to Loan #4 includes a $10.0 million initial advance, which has a base interest rate of 15.00%, and a second advance of $2.0 million, which has an interest rate of 39%. The statistics presented reflect the weighted average of the terms under both advances for the total aggregate loan commitment.
(9)	Subject to adjustment not below 2% if borrower receives at least two consecutive quarters of positive cash flow after the closing date.
(10)	The aggregate loan commitment to Loan #3 includes a $15.9 million initial advance, which has a base interest rate of 13.625%, 2.75% PIK and a second advance of $4.2 million, which has an interest rate of 15.00%, 2.00% PIK. The statistics presented reflect the weighted average of the terms under both advances for the total aggregate loan commitment.
(11)	This Loan is subject to an interest rate cap.

As of September 30, 2022, all loans are current and none have been placed on non-accrual status. These loans are generally held for investment and are substantially secured by real estate, equipment, licenses and other assets of the borrowers to the extent permitted by the applicable laws and the regulations governing such borrowers. The aggregate fair value of the Company’s loan portfolio was $328,984,374 and $197,901,779, with gross unrecognized holding losses of $2,091,173 and unrecognized holding gains of $917,213 as of September 30, 2022 and December 31, 2021, respectively. The fair values, which are classified as Level 3 in the fair value hierarchy, are estimated using discounted cash flow models based on current market inputs for similar types of arrangements. The primary sensitivity in these models is based on the selection of appropriate discount rates. Fluctuations in these assumptions could result in different estimates of fair value. As of September 30, 2022, the Company calculated the estimated fair value of the loans held for investment using unobservable inputs such as discount rates ranging from 11.36% to 24.79% with a weighted average discount rate of 17.54%.

Credit Quality Indicators

The Company assesses the risk factors of each loan, and assigns a risk rating based on a variety of factors, including, without limitation, payment history, real estate collateral coverage, property type, geographic and local market dynamics, financial performance, loan to enterprise value and fixed charge coverage ratios, loan structure and exit strategy, and project sponsorship. This review is performed quarterly. Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows:

Rating		Definition
1		Very low risk
2		Low risk
3		Moderate/average risk
4		High risk/potential for loss: a loan that has a risk of realizing a principal loss
5		Impaired/loss likely: a loan that has a high risk of realizing principal loss, has incurred principal loss or an impairment has been recorded

The risk ratings are primarily based on historical data and current conditions specific to each portfolio company, as well as consideration of future economic conditions and each borrower’s estimated ability to meet debt service requirements. The declines in risk ratings shown in the following table from December 31, 2021 to September 30, 2022 are not due to any borrower specific credit issues relating to the borrowers, but rather, are primarily due to the Company’s quarterly re-evaluation of overall current macroeconomic conditions affecting its borrowers. This decline in risk ratings did not have a significant effect on the level of the current expected credit loss reserve because the loans continued to perform as expected, and the fair value of the underlying collateral exceeded the amounts outstanding under the loans.

As of September 30, 2022 and December 31, 2021, the carrying value, excluding the current expected credit loss reserve (the “CECL Reserve”), of the Company’s loans within each risk rating category by year of origination is as follows:

	As of September 30, 2022										As of December 31, 2021
Risk Rating	2022		2021		2020		2019		Total		2021		2020		2019		Total
1	$	-	$	20,542,981	$	29,712,254	$	-	$	50,255,235	$	135,076,307	$	32,242,114	$	590,384	$	167,908,805
2		93,424,139		79,819,303		-		-		173,243,442		29,075,761		-		-		29,075,761
3		30,130,650		77,446,220		-		-		107,576,870		-		-		-		-
4		-		-		-		-		-		-		-		-		-
5		-		-		-		-		-		-		-		-		-
Total	$	123,554,789	$	177,808,504	$	29,712,254	$	-	$	331,075,547	$	164,152,068	$	32,242,114	$	590,384	$	196,984,566

(1)	Amounts are presented by loan origination year with subsequent advances shown in the original year of origination.

Real estate collateral coverage is also a significant credit quality indicator, and real estate collateral coverage, excluding the CECL Reserve, was as follows as of September 30, 2022 and December 31, 2021:

As of September 30, 2022 Real Estate Collateral Coverage
	< 1.0x		1.0x - 1.25x		1.25x - 1.5x		1.50x - 1.75x		1.75x - 2.0x		> 2.0x		Total
Fixed-rate	$	5,000,000	$	-	$	20,243,185	$	17,056,894	$	-	$	91,130,749	$	133,430,828
Floating-rate		8,943,733		97,660,654		-		31,920,426		13,263,665		45,856,241		197,644,719
	$	13,943,733	$	97,660,654	$	20,243,185	$	48,977,320	$	13,263,665	$	136,986,990	$	331,075,547

As of December 31, 2021 Real Estate Collateral Coverage
	< 1.0		1.0 - 1.25		1.25 - 1.5		1.50 - 1.75		1.75 - 2.0		> 2.0		Total
Fixed-rate	$	7,017,793	$	-	$	35,836,099	$	3,086,298	$	-	$	45,373,778	$	91,313,968
Floating-rate		8,925,068		18,022,518		-		30,029,953		32,377,087		16,315,972		105,670,598
	$	15,942,861	$	18,022,518	$	35,836,099	$	33,116,251	$	32,377,087	$	61,689,750	$	196,984,566

CECL Reserve

The Company records an allowance for current expected credit losses for its loans held for investment. The allowances are deducted from the gross carrying amount of the assets to present the net carrying value of the amounts expected to be collected on such assets. The Company estimates its CECL Reserve using among other inputs, third-party valuations, and a third-party probability-weighted model that considers the likelihood of default and expected loss given default for each individual loan based on the risk profile for approximately three years after which we immediately revert to use of historical loss data. In the future, we may use other acceptable methods, such as a discounted cash flow method, WARM method, or other methods permitted under the standard.

ASC 326 requires an entity to consider historical loss experience, current conditions, and a reasonable and supportable forecast of the macroeconomic environment. The Company considers multiple datapoints and methodologies that may include likelihood of default and expected loss given default for each individual loan, valuations derived from discount cash flows (“DCF”), and other inputs including the risk rating of the loan, how recently the loan was originated compared to the measurement date, and expected prepayment, if applicable. The measurement of expected credit losses under CECL is applicable to financial assets measured at amortized cost, and off-balance sheet credit exposures such as unfunded loan commitments.

The Company evaluates its loans on a collective (pool) basis by aggregating on the basis of similar risk characteristics as explained above. We make the judgment that loans to cannabis-related borrowers that are fully collateralized by real estate exhibit similar risk characteristics and are evaluated as a pool. Further, loans that have no real estate collateral, but are secured by other forms of collateral, including equity pledges of the borrower, and otherwise have similar characteristics as those collateralized by real estate are evaluated as a pool. All other loans are analyzed individually, either because they operate in a different industry, may have a different risk profile, or maturities that extend beyond the forecast horizon for which we are able to derive reasonable and supportable forecasts.

Estimating the CECL Reserve also requires significant judgment with respect to various factors, including (i) the appropriate historical loan loss reference data, (ii) the expected timing of loan repayments, (iii) calibration of the likelihood of default to reflect the risk characteristics of the Company’s loan portfolio, and (iv) the Company’s current and future view of the macroeconomic environment. From time to time, the Company may consider loan-specific qualitative factors on certain loans to estimate its CECL Reserve, which may include (i) whether cash from the borrower’s operations is sufficient to cover the debt service requirements currently and into the future, (ii) the ability of the borrower to refinance the loan, and (iii) the liquidation value of collateral. For loans where we have deemed the borrower/sponsor to be experiencing financial difficulty, we may elect to apply a practical expedient, in which the fair value of the underlying collateral is compared to the amortized cost of the loan in determining a CECL Reserve.

To estimate the historic loan losses relevant to the Company’s portfolio, the Company evaluates its historical loan performance, which includes zero realized loan losses since the inception of its operations. Additionally, the Company analyzed its repayment history, noting it has limited “true” operating history, since the incorporation date of March 30, 2021. However, the Company’s Sponsor and its affiliates have had operations for the past three fiscal years and have made investments in similar loans that have similar characteristics including interest rate, collateral coverage, guarantees, and prepayment/make whole provisions, which fall into the pools identified above. Given the similarity of the structuring of the credit agreements for the loans in the Company’s portfolio to the loans originated by its Sponsor, management considered it appropriate to consider the past repayment history of loans originated by the Sponsor and its affiliates in determining the extent to which a CECL Reserve shall be recorded.

In addition, the Company reviews each loan on a quarterly basis and evaluates the borrower’s ability to pay the monthly interest and principal, if required, as well as the loan-to-value (LTV) ratio. When evaluating qualitative factors that may indicate the need for a CECL Reserve, the Company forecasts losses considering a variety of factors. In considering the potential current expected credit loss, the Manager primarily considers significant inputs to the Company’s forecasting methods, which include (i) key loan-specific inputs such as the value of the real estate collateral, liens on equity (including the equity in the entity that holds the state-issued license to cultivate, process, distribute, or retail cannabis), presence of personal or corporate guarantees, among other credit enhancements, LTV ratio, rate type (fixed or floating) and IRR, loan-term, geographic location, and expected timing and amount of future loan fundings, (ii) performance against the underwritten business plan and the Company’s internal loan risk rating, and (iii) a macro-economic forecast. Estimating the enterprise value of our borrowers in order to calculate LTV ratios is often a significant estimate. The Manager utilizes a third-party valuation appraiser to assist with the Company’s valuation process primarily using comparable transactions to estimate enterprise value of its portfolio companies and supplement such analysis with a multiple-based approach to enterprise value to revenue multiples of publicly-traded comparable companies obtained from S&P CapitalIQ as of September 30, 2022, to which the Manager may apply a private company discount based on the Company’s current borrower profile. These estimates may change in future periods based on available future macro-economic data and might result in a material change in the Company’s future estimates of expected credit losses for its loan portfolio.

Regarding real estate collateral, the Company generally cannot take the position of mortgagee-in-possession as long as the property is used by a cannabis operator, but it can request that the court appoint a receiver to manage and operate the subject real property until the foreclosure proceedings are completed. Additionally, while the Company cannot foreclose under state Uniform Commercial Code (“UCC”) and take title or sell equity in a licensed cannabis business, a potential purchaser of a delinquent or defaulted loan could.

In order to estimate the future expected loan losses relevant to the Company’s portfolio, the Company utilizes historical market loan loss data obtained from a third-party database for commercial real estate loans, which the Company believes is a reasonably comparable and available data set to use as an input for its type of loans. The Company believes this dataset to be representative for future credit losses whilst considering that the cannabis industry is maturing, and consumer adoption, demand for production, and retail capacity are increasing akin to commercial real estate over time. For periods beyond the reasonable and supportable forecast period, the Company reverts back to historical loss data.

All of the above assumptions, although made with the most available information at the time of the estimate, are subjective and actual activity may not follow the estimated schedule. These assumptions impact the future balances that the loss rate will be applied to and as such impact the Company’s CECL Reserve. As the Company acquires new loans and the Manager monitors loan and borrower performance, these estimates will be revised each period.

Activity related to the CECL Reserve for outstanding balances and unfunded commitments on the Company’s loans held at carrying value and loans receivable at carrying value as of and for the nine months ended September 30, 2022 is presented in the table below. The Company had no CECL Reserve as of and for the period March 30, 2021 (inception) to September 30, 2021.

	Outstanding⁽¹⁾		Unfunded⁽²⁾		Total
Balance at December 31, 2021	$	134,542	$	13,407	$	147,949
Provision for current expected credit losses		1,363,391		40,501		1,403,892
Write-off charged		-		-		-
Recoveries		-		-		-
Balance at September 30, 2022	$	1,497,933	$	53,908	$	1,551,841

(1)	As of September 30, 2022, the CECL Reserve related to outstanding balances on loans at carrying value is recorded within current expected credit loss reserve in the Company’s consolidated balance sheets.

(2)	As of September 30, 2022, the CECL Reserve related to unfunded commitments on loans at carrying value is recorded within accounts payable and accrued liabilities in the Company’s consolidated balance sheets.

	Outstanding		Unfunded
Balance at December 31, 2021	$	134,542	$	13,407
Provision for current expected credit losses		48,296		3,047
Balance at March 31, 2022		182,838		16,454
Provision for current expected credit losses		1,020,586		25,079
Balance at June 30, 2022		1,203,424		41,533
Provision for current expected credit losses		294,509		12,375
Balance at September 30, 2022	$	1,497,933	$	53,908

The Company has made an accounting policy election to exclude accrued interest receivable, ($727,279 as of September 30, 2022) included in Interest Receivable on its consolidated balance sheet, from the amortized cost basis of the related loans held for investment in determining the CECL Reserve, as any uncollectible accrued interest receivable is written off in a timely manner. To date, the Company has had zero write-offs related to uncollectible interest receivable, but will discontinue accrual of interest on loans if deemed to be uncollectible, with any previously accrued uncollected interest on the loan charged to interest income in the same period.

As of September 30, 2022, there were no loans with principal or interest greater than 30 days past due.

Interest Receivable

9 Months Ended

Sep. 30, 2022

Interest Receivable [Abstract]

INTEREST RECEIVABLE

4. INTEREST RECEIVABLE

The following table summarizes the interest receivable by the Company as of September 30, 2022 and December 31, 2021:

	As of September 30, 2022		As of December 31, 2021
Interest receivable	$	627,709	$	193,790
PIK interest receivable		95,139		-
Unused fees receivable		4,431		3,945
Total interest receivable	$	727,279	$	197,735

Interest Reserve

9 Months Ended

Sep. 30, 2022

Interest Reserve [Abstract]

INTEREST RESERVE

5. INTEREST RESERVE

At September 30, 2022, the Company had six loans that included a prepaid interest reserve.

The following table presents changes in interest reserves as of September 30, 2022 and December 31, 2021, respectively:

	As of September 30, 2022			As of December 31, 2021
Initial reserves	$	6,636,553		$	-
New reserves		8,929,716			9,223,802
Reserves disbursed		(9,940,290	)		(2,587,249	)
Total interest reserve	$	5,625,979		$	6,636,553

Debt

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

DEBT

6. DEBT

In May 2021, in connection with the Company’s acquisition of its financing subsidiary, CAL, the Company was assigned a secured revolving credit facility (the “Revolving Loan”). The Revolving Loan has an aggregate borrowing base of up to $10,000,000 and bore interest, payable in cash in arrears, at a per annum rate equal to the greater of (x) Prime Rate plus 1.00% and (y) 4.75%. The Company incurred debt issuance costs of $100,000 related to the origination of the Revolving Loan, which were capitalized and are subsequently being amortized through maturity. The maturity date of the Revolving Loan was the earlier of (i) February 12, 2023 and (ii) the date on which the Revolving Loan is terminated pursuant to terms in the Revolving Loan Agreement.

On December 16, 2021, the Company amended the Revolving Loan Agreement (the “First Amendment”). The First Amendment increased the loan commitment from $10,000,000 to $45,000,000 and decreased the interest rate, from the greater of the (1) Prime Rate plus 1.00% and (2) 4.75% to the greater of (1) the Prime Rate plus the applicable margin and (2) 3.25%. The applicable margin is derived from a floating rate grid based upon the ratio of debt to equity of CAL and increases from 0% at a ratio of 0.25 to 1 to 1.25% at a ratio of 1.5 to 1. The First Amendment also extended the maturity date from February 12, 2023 to the earlier of (i) December 16, 2023 and (ii) the date on which the Revolving Loan is terminated pursuant to the terms of the Revolving Loan agreement. The Company has the option to extend the initial term for an additional one-year term, provided no events of default exist and the Company provides the required notice of the extension pursuant to the First Amendment. The Company incurred debt issuance costs of $859,500 related to the First Amendment, which were capitalized and are subsequently being amortized through maturity.

On May 12, 2022, the Company amended the Revolving Loan Agreement (the “Second Amendment”). The Second Amendment increased the loan commitment from $45,000,000 to $65,000,000. No other material terms of the Revolving Loan were modified as a result of the execution of the Second Amendment. The Company incurred debt issuance costs of $177,261 related to the Second Amendment, which were capitalized and are subsequently amortized through maturity. As of September 30, 2022 and December 31, 2021, unamortized debt issuance costs related to the Revolving Loan and the First and Second Amendments of $665,639 and $868,022, respectively, are recorded in other receivables and assets, net on the consolidated balance sheets.

The Revolving Loan incurs unused fees at a rate of 0.25% per annum which began on July 1, 2022 pursuant to the Second Amendment. Additionally, during the period from January 1, 2022 to September 30, 2022, the Company borrowed $53.0 million against the Revolving Loan and incurred $991,694 in interest expense for the period then ended.

The Second Amendment provides for certain affirmative covenants, including requiring us to deliver financial information and any notices of default, and conducting business in the normal course. Additionally, the Company must comply with certain financial covenants including: (1) maximum capital expenditures of $150,000, (2) maintaining a debt service coverage ratio greater than 1.35 to 1, and (3) maintaining a leverage ratio less than 1.50 to 1. As of September 30, 2022, we were in compliance with all financial covenants with respect to the Revolving Loan.

The fair value of the Revolving Loan, which is classified as Level 2 in the fair value hierarchy, approximates the carrying value as it bears a market rate of interest that is reset frequently.

The following table reflects a summary of interest expense incurred during the three and nine months ended September 30, 2022. There was no interest expense incurred during the period March 30, 2021 (inception) to September 30, 2021.

	Three months ended September 30, 2022		Nine months ended September 30, 2022
Interest expense	$	715,132	$	991,694
Unused fee expense		7,667		11,834
Amortization of deferred financing costs		138,549		379,644
Total interest expense	$	861,348	$	1,383,172

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI https://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 1I
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-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
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-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 1E
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

Related Party Transactions

9 Months Ended

Sep. 30, 2022

RELATED PARTY TRANSACTIONS

7. RELATED PARTY TRANSACTIONS

Management Agreement

Pursuant to the Management Agreement, the Manager is responsible for managing the loan portfolio and the day-to-day operations of the Company, subject at all times to the further terms and conditions set forth in the Management Agreement and such further limitations or parameters as may be imposed from time to time by the Company’s Board.

The Manager is entitled to receive base management fees (the “Base Management Fee”) that are calculated and payable quarterly in arrears, in an amount equal to 0.375% of the Company’s Equity, determined as of the last day of each such quarter; reduced by an amount equal to 50% of the pro rata amount of origination fees earned and paid to the Manager during the applicable quarter for loans that were originated on the Company’s behalf by the Manager or affiliates of the Manager (“Outside Fees”). For the three and nine months ended September 30, 2022, the Base Management Fee payable was reduced by Outside Fees in the amount of $192,751 and $1,275,001, respectively.

In addition to the Base Management Fee, the Manager is entitled to receive incentive compensation (the “Incentive Compensation” or “Incentive Fees”) under the Management Agreement. Under the Management Agreement, the Company will pay Incentive Fees to the Manager based upon the Company’s achievement of targeted levels of Core Earnings. “Core Earnings” is defined in the Management Agreement as, for a given period, the net income (loss) for such period, computed in accordance with GAAP, excluding (i) non-cash equity compensation expense, (ii) the Incentive Compensation, (iii) depreciation and amortization, (iv) any unrealized gains or losses or other non-cash items that are included in net income for the applicable reporting period, regardless of whether such items are included in other comprehensive income or loss, or in net income, and (v) one-time events pursuant to changes in GAAP and certain non-cash charges, in each case after discussions between the Manager and the members of the Compensation Committee of the Board, each of whom are Independent Directors, and approved by a majority of the members of the Compensation Committee. Incentive compensation for the three and nine months ended September 30, 2022 was $519,223 and $1,500,129, respectively.

The Company shall pay all of its costs and expenses and shall reimburse the Manager or its affiliates for expenses of the Manager and its affiliates paid or incurred on behalf of the Company, excepting only those expenses that are specifically the responsibility of the Manager pursuant to the Management Agreement. We reimburse our Manager or its affiliates, as applicable, for the Company’s fair and equitable allocable share of the compensation, including annual base salary, bonus, any related withholding taxes and employee benefits, paid to (i) subject to review by the Compensation Committee of the Board, the Manager’s personnel serving as an officer of the Company, based on the percentage of his or her time spent devoted to the Company’s affairs and (ii) other corporate finance, tax, accounting, internal audit, legal, risk management, operations, compliance, and other non-investment personnel of the Manager and its affiliates who spend all or a portion of their time managing the Company’s affairs, with the allocable share of the compensation of such personnel described in this clause (ii) being as reasonably determined by the Manager to appropriately reflect the amount of time spent devoted by such personnel to our affairs.

The following table summarizes the related party fees and expenses incurred by the Company and amounts payable to the Manager for the three and nine months ended September 30, 2022, the three months ended September 30, 2021 and for the period from March 30, 2021 (inception) to September 30, 2021. The Manager waived all amounts owed to it for the period ended September 30, 2021.

	For the three months ended September 30, 2022			For the three months ended September 30, 2021		For the nine months ended September 30, 2022			Period from March 30, 2021 (inception) to September 30, 2021
Affiliate Payments
Management fees earned	$	1,020,949		$	-	$	3,041,359		$	-
Less: Outside fees earned		(192,751	)		-		(1,275,001	)		-
Base management fee, net		828,198			-		1,766,358			-
Incentive fees		519,223			-		1,500,129			-
Total management and incentive fees earned		1,347,421			-		3,266,487			-
General and administrative expenses reimbursable to Manager		980,949			-		2,132,419			-
Total	$	2,328,370		$	-	$	5,398,906		$	-

General administrative expenses reimbursable to the Manager are included in the related party payable line item of the consolidated balance sheets as of September 30, 2022 and December 31, 2021. Amounts payable to the Manager as of September 30, 2022 and December 31, 2021 were approximately $2.6 million and $2.7 million, respectively, which included bonuses accrued for fiscal year 2022 which are not reimbursed to the Manager until paid.

Co-Investment in Loans

From time to time, the Company may co-invest with other investment vehicles managed by its affiliates, in accordance with the Manager’s co-investment allocation policies. The Company is not obligated to provide, nor has it provided, any financial support to the other managed investment vehicles. As such, the Company’s risk is limited to the carrying value of its investment in any such loan. As of September 30, 2022, 15 of the Company’s loans were co-invested by affiliates of the Company.

On July 8, 2022, the Company sold a senior secured loan to an affiliate under common control. The selling price of approximately $6.7 million was approved by the audit committee of the Board. The fair value approximated the carrying value of the loan plus accrued and unpaid interest. On August 4, 2022, the Company assigned $10.0 million of unfunded commitment of a senior secured loan to an affiliate.

Commitments and Contingencies

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

8. COMMITMENTS AND CONTINGENCIES

Off-Balance Sheet Arrangements

Off-balance sheet commitments may consist of unfunded commitments on delayed draw term loans. The Company does not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured investment vehicles, special purpose entities, or variable interest entities, established to facilitate off-balance sheet arrangements or other contractually narrow or limited purposes. Further, the Company has not guaranteed any obligations of unconsolidated entities or entered into any commitment to provide additional funding to any such entities. As of September 30, 2022 and December 31, 2021, the Company had the following unfunded commitments on existing loans.

	As of September 30, 2022			As of December 31, 2021

Total original loan commitments	$	348,867,706		$	235,063,593
Less: drawn commitments		(330,384,897	)		(200,359,026	)
Total undrawn commitments	$	18,482,809		$	34,704,567

Refer to “Note 3 – Loans Held for Investment, Net” for further information regarding the CECL Reserve attributed to unfunded commitments.

Other Contingencies

The Company from time to time may be a party to litigation in the normal course of business. As of September 30, 2022, the Company is not aware of any legal claims that could materially impact its business, financial condition, or results of operations.

The Company’s ability to grow or maintain its business depends, in part, on state laws pertaining to the cannabis industry. New laws that are adverse to the Company’s portfolio companies may be enacted, and current favorable state or national laws or enforcement guidelines relating to cultivation, production, and distribution of cannabis may be modified or eliminated in the future, which would impede the Company’s ability to grow and could materially and adversely affect its business.

Management’s plan to mitigate risks include monitoring the legal landscape as deemed appropriate. Also, should a loan default or otherwise be seized, the Company may be prohibited from owning cannabis assets and thus could not take possession of collateral, in which case the Company would look to sell the loan, provide consent to allow the borrower to sell the real estate to a third party, institute a foreclosure proceeding to have the real estate sold or evict the tenant, have the cannabis operations removed from the property and take title to the underlying real estate, each of which may result in the Company realizing a loss on the transaction.

Stockholders' Equity

9 Months Ended

Sep. 30, 2022

Stockholders' Equity Note [Abstract]

STOCKHOLDERS’ EQUITY

9. STOCKHOLDERS’ EQUITY

Common Stock

On January 5, 2022, the underwriters of the Company’s initial public offering (the “IPO”) partially exercised their over-allotment option to purchase 302,800 shares of the Company’s common stock at a price of $16.00 per share, raising $4,844,800 in additional gross proceeds or $4,505,664 in net proceeds after underwriting commissions of $339,136, which is reflected as a reduction of additional paid-in capital on the consolidated statements of stockholders’ equity.

During the period from March 30, 2021 (inception) to December 31, 2021, the Company issued 10,636,363 shares of its common stock pursuant to transactions that were exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended.

On December 10, 2021, the Company completed its IPO of 6,250,000 shares of its common stock at a price of $16.00 per share, raising $100,000,000 in gross proceeds. The underwriting commission of $7,000,000 is reflected as a reduction of additional paid-in capital on the consolidated statements of stockholders’ equity. The Company incurred approximately $1,265,877 of expenses in connection with the IPO, which is reflected as a reduction in additional paid-in capital. The net proceeds to the Company totaled approximately $91,734,123. Concurrent with the closing of the IPO, the Company sold 468,750 shares of its common stock at the public offering price of $16.00 per share in a private placement to John Mazarakis, the Company’s Executive Chairman, Anthony Cappell, the Company’s Chief Executive Officer, and Dr. Andreas Bodmeier, the Company’s Co-President. Gross proceeds received were $7,500,000, and no underwriting discounts or commissions were paid in respect of these shares.

On October 21, 2021, the Board approved a 6,427-for-one stock split of the Company’s common stock. All common shares and per share information presented in the consolidated financial statements have been adjusted to reflect the stock split on a retroactive basis for all periods presented, including reclassifying an amount equal to the increase in par value of common stock from additional paid-in capital. There was no change in the par value of the Company’s common stock.

Equity Incentive Plan

The Company has established an equity incentive compensation plan (the “2021 Plan”). The Board authorized the adoption of the 2021 Plan and the Compensation Committee of the Board approved restricted stock award grants of 98,440 shares of common stock during the quarter ended December 31, 2021. The Compensation Committee appointed by the Board administers the 2021 Plan. The 2021 Plan authorizes stock options, stock appreciation rights, restricted stock, stock bonuses, stock units, and other forms of awards granted or denominated in the Company’s common stock. The 2021 Plan retains flexibility to offer competitive incentives and to tailor benefits to specific needs and circumstances. Any award may be structured to be paid or settled in cash. The Company has and currently intends to continue to grant restricted stock awards to participants in the 2021 Plan, but it may also grant any other type of award available under the 2021 Plan in the future. Persons eligible to receive awards under the 2021 Plan include the Company’s officers and employees of the Manager and its affiliates or officers and employees of the Company’s subsidiaries, if any, the members of the Board, and certain consultants and other service providers.

As of September 30, 2022 and December 31, 2021, the maximum number of shares of the Company’s common stock that may be delivered pursuant to awards under the 2021 Plan (the “Share Limit”) equals 8.50% of the issued and outstanding shares of the Company’s common stock on a fully-diluted basis following the completion of the IPO. Shares that are subject to or underlie awards that expire or for any reason are cancelled or terminated, are forfeited, fail to vest, or for any other reason are not paid or delivered under the 2021 Plan will not be counted against the Share Limit and will again be available for subsequent awards under the 2021 Plan. There were 13,438 shares forfeited during the nine months ended September 30, 2022. There is no forfeiture rate applied to awards or options granted to non-employee directors or executive employees because their pre-vesting forfeitures are anticipated to be highly unlikely. As individual awards and options become fully vested, stock-based compensation expense is adjusted to recognize actual forfeitures.

Shares that are exchanged by a participant or withheld by the Company as full or partial payment in connection with any award granted under the 2021 Plan, as well as any shares exchanged by a participant or withheld by the Company to satisfy tax withholding obligations related to any award granted under the 2021 Plan, will not be counted against the Share Limit and will again be available for subsequent awards under the 2021 Plan. To the extent that an award is settled in cash or a form other than shares, the shares that would have been delivered had there been no such cash or other settlement will not be counted against the Share Limit and will again be available for subsequent awards under the 2021 Plan.

The following table summarizes the restricted stock activity for the Company’s directors and officers and employees of the Manager as of September 30, 2022 and December 31, 2021.

	As of September 30, 2022			As of December 31, 2021
Non-vested		98,440			98,440
Forfeited		(13,438	)		-
Balance		85,002			98,440

Restricted stock compensation expense is based on the Company’s stock price at the date of the grant and is amortized over the vesting period. Forfeitures are recognized as they occur. The share-based compensation expense for the Company was $328,356 and $0 for the nine months ended September 30, 2022 and for the period from March 30, 2021 (inception) to September 30, 2021, respectively. The unamortized share-based compensation expense for the Company was approximately $1.0 million as of September 30, 2022.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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+ Details

Earnings Per Share

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

EARNINGS PER SHARE

10. EARNINGS PER SHARE

The following information sets forth the computations of basic earnings per common share for the three and nine months ended September 30, 2022, the three months ended September 30, 2021 and for the period from March 30, 2021 (inception) to September 30, 2021:

	For the three months ended September 30, 2022		For the three months ended September 30, 2021		For the nine months ended September 30, 2022		Period from March 30, 2021 (inception) to September 30, 2021
Net income attributable to common stockholders	$	9,768,969	$	4,067,521	$	25,036,760	$	5,136,072
Divided by:
Basic weighted average shares of common stock outstanding		17,657,913	$	4,895,694		17,652,367		3,658,310
Diluted weighted average shares of common stock outstanding		17,752,290	$	4,895,694		17,747,612		3,658,310
Basic earnings per common share	$	0.55	$	0.83	$	1.42	$	1.40
Diluted earnings per common share	$	0.55	$	0.83	$	1.41	$	1.40

Income Tax

9 Months Ended

Sep. 30, 2022

Income Tax Disclosure [Abstract]

INCOME TAX

11. INCOME TAX

The income tax provision for the Company was $0 for the nine months ended September 30, 2022.

For the three and nine months ended September 30, 2022, the Company incurred no expense for United States federal excise tax. If it is determined that the Company’s estimated current year taxable income will be in excess of estimated dividend distributions (including capital gain dividend) for the current year from such income, the Company will accrue excise tax on estimated excess taxable income as such taxable income is earned. The annual expense is calculated in accordance with applicable tax regulations.

As of September 30, 2022 and December 31, 2021, the Company does not have any unrecognized tax benefits and does not expect that to change in the next 12 months.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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+ Details

Dividends and Distributions

9 Months Ended

Sep. 30, 2022

Dividends And Distributions Abstract

DIVIDENDS AND DISTRIBUTIONS

12. DIVIDENDS AND DISTRIBUTIONS

The following table summarizes the Company’s dividends declared during the nine months ended September 30, 2022.

	Record Date	Payment Date	Common Share Distribution Amount		Taxable Ordinary Income		Return of Capital		Section 199A Dividends
Regular cash dividend	3/31/2022	4/14/2022	$	0.40	$	0.40	$	-	$	0.40
Regular cash dividend	6/30/2022	7/15/2022	$	0.47	$	0.47	$	-	$	0.47
Regular cash dividend	9/30/2022	10/14/2022	$	0.47	$	0.47	$	-	$	0.47
Total cash dividend			$	1.34	$	1.34	$	-	$	1.34

Subsequent Events

9 Months Ended

Sep. 30, 2022

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

13. SUBSEQUENT EVENTS

On October 27, 2022, one borrower with $30.0 million of outstanding principal in multiple tranches maturing in April and May of 2023 refinanced and consolidated the multiple tranches of debt into one loan maturing in October 2026.

On November 7, 2022, the Company’s wholly-owned financing subsidiary, CAL, entered into a Third Amended and Restated Loan and Security Agreement (the “Third Amendment”), whereby CAL exercised the existing accordion feature of the Revolving Loan to increase the aggregate commitment by $27.5 million, from $65 million to $92.5 million. No other material terms of the Revolving Loan were modified as a result of the execution of the Third Amendment. As of November 9, 2022, the Company has approximately $34.5 million of availability under the Revolving Loan.

Accounting Policies, by Policy (Policies)	9 Months Ended
Accounting Policies, by Policy (Policies)	Sep. 30, 2022
Accounting Policies [Abstract]
Basis of Presentation	*Basis of Presentation* The accompanying unaudited condensed consolidated financial statements and related notes of the Company have been prepared on the accrual basis of accounting and in conformity with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these financial statements may not contain all disclosures required by generally accepted accounting principles. Reference should be made to Note 2 of the Company’s Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the period ended December 31, 2021. In the opinion of the Company, all normal recurring adjustments have been made that are necessary to the fair statement of the results of operations and financial position as of and for the periods presented. Operating results for the three and nine-month periods ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022.
Use of Estimates in the Preparation of Consolidated Financial Statements	*Use of Estimates in the Preparation of Consolidated Financial Statements* The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Actual results could differ from those estimates. Significant estimates include the provision for current expected credit losses.
Reclassifications	*Reclassifications* Certain prior period amounts have been reclassified to conform to the current period presentation. Interest expense was previously presented as an operating expense and has been reclassified as a reduction to net revenue on the consolidated statements of income. General and administrative expense reimbursements due to the Manager, which were previously included in the line item management and incentive fees payable, have been reclassified into related party payable in the consolidated balance sheets. In addition, other receivables amounts have been reclassified to other receivables and assets, net in the consolidated balance sheets. These reclassifications do not result in any changes to previously reported total assets and net income.
Investment Payable	*Investment Payable* Investment transactions are reported on a trade-date basis. Unsettled trades as of the balance sheet date, if any, are included in payable for investments purchased.
Recent Accounting Pronouncements	*Recent Accounting Pronouncements* As of September 30, 2022, the Company is evaluating the potential impact of recently issued accounting pronouncements on its consolidated financial statements.

Loans Held For Investment, Net (Tables)

9 Months Ended

Sep. 30, 2022

Loans Held For Investment Net Abstract

Schedule of loans held for investment

			As of September 30, 2022						Weighted Average
	Outstanding Principal (1)		Original Issue Discount			Carrying Value (1)			Remaining Life (Years) (2)
Senior Term Loans	$	334,502,935	$	(3,427,388	)	$	331,075,547		2.1
Current expected credit loss reserve		-		-			(1,497,933	)
Total loans held at carrying value, net	$	334,502,935	$	(3,427,388	)	$	329,577,614

			As of December 31, 2021						Weighted Average
	Outstanding Principal (1)		Original Issue Discount			Carrying Value (1)			Remaining Life (Years) (2)
Senior Term Loans	$	200,632,056	$	(3,647,490	)	$	196,984,566		2.2
Current expected credit loss reserve		-		-			(134,542	)
Total loans held at carrying value, net	$	200,632,056	$	(3,647,490	)	$	196,850,024

Schedule of changes in loans held at carrying value

	Principal (1)			Original Issue Discount			Current Expected Credit Loss Reserve			Carrying Value (1)
Balance at December 31, 2021	$	200,632,056		$	(3,647,490	)	$	(134,542	)	$	196,850,024
Issuance of and funding of loans		143,624,312			(2,180,593	)		-			141,443,719
Principal repayment of loans		(6,892,654	)		-			-			(6,892,654	)
Accretion of original issue discount		-			2,139,972			-			2,139,972
Proceeds from sale of loans		(6,957,500	)		260,723			-			(6,696,777	)
PIK Interest		4,096,721			-			-			4,096,721
Current expected credit loss reserve		-			-			(1,363,391	)		(1,363,391	)
Balance at September 30, 2022	$	334,502,935		$	(3,427,388	)	$	(1,497,933	)	$	329,577,614

	Principal (1)			Original Issue Discount			Current Expected Credit Loss Reserve		Carrying Value (1)
Balance at March 30, 2021 (inception)	$	-		$	-		$	-	$	-
Loans contributed		32,589,907			(613,391	)		-		31,976,516
New fundings		105,952,844			(1,778,500	)		-		104,174,344
Principal repayment of loans		(9,582,613	)		-			-		(9,582,613	)
Accretion of original issue discount		-			276,838			-		276,838
Sale of loans		-			-			-		-
PIK Interest		278,079			-			-		278,079
Balance at September 30, 2021	$	129,238,217		$	(2,115,053	)	$	-	$	127,123,164

Schedule of loans held at carrying value based on information

Loan	Location	Outstanding Principal(1)		Original Issue Premium/ (Discount)			Carrying Value(1)			Contractual Interest Rate(4)	Maturity Date(2)	Payment Terms(3)	Initial Funding Date
1	Various⁽⁶⁾		30,000,000		(287,746	)		29,712,254		10.07%⁽⁷⁾	5/30/2023	I/O	7/2/2020
2	Michigan		36,646,551		(182,125	)		36,464,426		P + 6.65%^(5)(11) Cash, 3.25% PIK	12/31/2024	P&I	3/5/2021
3	Various⁽⁶⁾		20,673,831		(444,457	)		20,229,374		13.91% Cash, 2.59% PIK⁽¹⁰⁾	11/29/2024	P&I	3/25/2021
4	Arizona		11,909,539		-			11,909,539		19.01%⁽⁸⁾	12/31/2023	P&I	4/19/2021
5	Massachusetts		1,500,000		-			1,500,000		P + 12.25%⁽⁵⁾	4/30/2023	P&I	4/19/2021
6	Pennsylvania		13,263,665		-			13,263,665		P + 10.75%⁽⁵⁾ Cash, 4% PIK⁽⁹⁾	5/31/2025	P&I	5/28/2021
7	Michigan		4,443,750		(5,558	)		4,438,192		P + 9.00%⁽⁵⁾	2/20/2024	P&I	8/20/2021
8	Various⁽⁶⁾		23,168,151		(242,929	)		22,925,222		13% Cash, 2.5% PIK	6/30/2025	P&I	8/24/2021
9	West Virginia		9,554,960		(121,586	)		9,433,374		P + 9.25%⁽⁵⁾ Cash, 2% PIK	9/1/2024	P&I	9/1/2021
10	Pennsylvania		15,536,102		-			15,536,102		P + 10.75%⁽⁵⁾ Cash, 3% PIK	6/30/2024	P&I	9/3/2021
11	Michigan		313,607		-			313,607		11.00%	9/30/2024	P&I	9/20/2021
12	Maryland		32,479,495		(714,967	)		31,764,528		P + 8.75%⁽⁵⁾ Cash, 2% PIK	9/30/2024	I/O	9/30/2021
13	Various⁽⁶⁾		20,000,000		(210,110	)		19,789,890		13.00%	10/31/2024	P&I	11/8/2021
14	Michigan		10,600,000		(22,487	)		10,577,513		P + 7.00%⁽⁵⁾	11/22/2022	I/O	11/22/2021
15	Various⁽⁶⁾		5,000,000		-			5,000,000		15% Cash, 2.5% PIK	12/27/2026	P&I	12/27/2021
16	Michigan		3,739,861		(56,096	)		3,683,765		10.50% Cash, 5% PIK	12/29/2023	I/O	12/29/2021
17	Various⁽⁶⁾		7,500,000		(56,267	)		7,443,733		P + 9.25%⁽⁵⁾	12/31/2024	I/O	12/30/2021
18	Florida		15,000,000		(293,989	)		14,706,011		11.00%	1/31/2025	P&I	1/18/2022
19	Ohio		30,602,729		(472,079	)		30,130,650		P + 8.25%⁽⁵⁾ Cash, 3% PIK	2/28/2025	P&I	2/3/2022
20	Florida		20,327,703		(84,518	)		20,243,185		11.00% Cash, 3% PIK	8/29/2025	P&I	3/11/2022
21	Missouri		17,204,978		(148,084	)		17,056,894		11.00% Cash, 3% PIK	5/30/2025	P&I	5/9/2022
22	Illinois		5,038,013		(84,390	)		4,953,623		P + 8.50% Cash, 3%⁽⁵⁾ PIK	6/30/2026	P&I	7/1/2022

Current expected credit loss reserve			-		-			(1,497,933	)
Total loans held at carrying value		$	334,502,935	$	(3,427,388	)	$	329,577,614

Schedule of risk rating

Rating		Definition
1		Very low risk
2		Low risk
3		Moderate/average risk
4		High risk/potential for loss: a loan that has a risk of realizing a principal loss
5		Impaired/loss likely: a loan that has a high risk of realizing principal loss, has incurred principal loss or an impairment has been recorded

Schedule of carrying value of loans held for investment

	As of September 30, 2022										As of December 31, 2021
Risk Rating	2022		2021		2020		2019		Total		2021		2020		2019		Total
1	$	-	$	20,542,981	$	29,712,254	$	-	$	50,255,235	$	135,076,307	$	32,242,114	$	590,384	$	167,908,805
2		93,424,139		79,819,303		-		-		173,243,442		29,075,761		-		-		29,075,761
3		30,130,650		77,446,220		-		-		107,576,870		-		-		-		-
4		-		-		-		-		-		-		-		-		-
5		-		-		-		-		-		-		-		-		-
Total	$	123,554,789	$	177,808,504	$	29,712,254	$	-	$	331,075,547	$	164,152,068	$	32,242,114	$	590,384	$	196,984,566

Schedule of real estate collateral coverage

As of September 30, 2022 Real Estate Collateral Coverage
	< 1.0x		1.0x - 1.25x		1.25x - 1.5x		1.50x - 1.75x		1.75x - 2.0x		> 2.0x		Total
Fixed-rate	$	5,000,000	$	-	$	20,243,185	$	17,056,894	$	-	$	91,130,749	$	133,430,828
Floating-rate		8,943,733		97,660,654		-		31,920,426		13,263,665		45,856,241		197,644,719
	$	13,943,733	$	97,660,654	$	20,243,185	$	48,977,320	$	13,263,665	$	136,986,990	$	331,075,547

As of December 31, 2021 Real Estate Collateral Coverage
	< 1.0		1.0 - 1.25		1.25 - 1.5		1.50 - 1.75		1.75 - 2.0		> 2.0		Total
Fixed-rate	$	7,017,793	$	-	$	35,836,099	$	3,086,298	$	-	$	45,373,778	$	91,313,968
Floating-rate		8,925,068		18,022,518		-		30,029,953		32,377,087		16,315,972		105,670,598
	$	15,942,861	$	18,022,518	$	35,836,099	$	33,116,251	$	32,377,087	$	61,689,750	$	196,984,566

Schedule of Activity related to the CECL Reserve for outstanding balances

	Outstanding⁽¹⁾		Unfunded⁽²⁾		Total
Balance at December 31, 2021	$	134,542	$	13,407	$	147,949
Provision for current expected credit losses		1,363,391		40,501		1,403,892
Write-off charged		-		-		-
Recoveries		-		-		-
Balance at September 30, 2022	$	1,497,933	$	53,908	$	1,551,841

Schedule of Provision for current expected credit losses

	Outstanding		Unfunded
Balance at December 31, 2021	$	134,542	$	13,407
Provision for current expected credit losses		48,296		3,047
Balance at March 31, 2022		182,838		16,454
Provision for current expected credit losses		1,020,586		25,079
Balance at June 30, 2022		1,203,424		41,533
Provision for current expected credit losses		294,509		12,375
Balance at September 30, 2022	$	1,497,933	$	53,908

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 1
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Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 3
-Subparagraph (SX 210.12-04(a))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e24072-122690

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
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Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
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Reference 5: http://www.xbrl.org/2003/role/exampleRef
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-Name Accounting Standards Codification
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Reference 7: http://www.xbrl.org/2003/role/exampleRef
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Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=123599511&loc=d3e64711-112823

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+ Details

Interest Receivable (Tables)

9 Months Ended

Sep. 30, 2022

Interest Receivable [Abstract]

Schedule of summarizes the interest receivable

	As of September 30, 2022		As of December 31, 2021
Interest receivable	$	627,709	$	193,790
PIK interest receivable		95,139		-
Unused fees receivable		4,431		3,945
Total interest receivable	$	727,279	$	197,735

Interest Reserve (Tables)

9 Months Ended

Sep. 30, 2022

Schedule of changes in interest reserves

Schedule of changes in interest reserves

	As of September 30, 2022			As of December 31, 2021
Initial reserves	$	6,636,553		$	-
New reserves		8,929,716			9,223,802
Reserves disbursed		(9,940,290	)		(2,587,249	)
Total interest reserve	$	5,625,979		$	6,636,553

Debt (Tables)

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

Schedule of summary of interest expense incurred during period

	Three months ended September 30, 2022		Nine months ended September 30, 2022
Interest expense	$	715,132	$	991,694
Unused fee expense		7,667		11,834
Amortization of deferred financing costs		138,549		379,644
Total interest expense	$	861,348	$	1,383,172

Related Party Transactions (Tables)

9 Months Ended

Sep. 30, 2022

Schedule of summarizes the related party costs

	For the three months ended September 30, 2022			For the three months ended September 30, 2021		For the nine months ended September 30, 2022			Period from March 30, 2021 (inception) to September 30, 2021
Affiliate Payments
Management fees earned	$	1,020,949		$	-	$	3,041,359		$	-
Less: Outside fees earned		(192,751	)		-		(1,275,001	)		-
Base management fee, net		828,198			-		1,766,358			-
Incentive fees		519,223			-		1,500,129			-
Total management and incentive fees earned		1,347,421			-		3,266,487			-
General and administrative expenses reimbursable to Manager		980,949			-		2,132,419			-
Total	$	2,328,370		$	-	$	5,398,906		$	-

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Schedule of commitments to fund various existing loans

	As of September 30, 2022			As of December 31, 2021

Total original loan commitments	$	348,867,706		$	235,063,593
Less: drawn commitments		(330,384,897	)		(200,359,026	)
Total undrawn commitments	$	18,482,809		$	34,704,567

Stockholders' Equity (Tables)

9 Months Ended

Sep. 30, 2022

Stockholders' Equity Note [Abstract]

Schedule of restricted stock activity

	As of September 30, 2022			As of December 31, 2021
Non-vested		98,440			98,440
Forfeited		(13,438	)		-
Balance		85,002			98,440

Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

Schedule of basic earnings per common share

	For the three months ended September 30, 2022		For the three months ended September 30, 2021		For the nine months ended September 30, 2022		Period from March 30, 2021 (inception) to September 30, 2021
Net income attributable to common stockholders	$	9,768,969	$	4,067,521	$	25,036,760	$	5,136,072
Divided by:
Basic weighted average shares of common stock outstanding		17,657,913	$	4,895,694		17,652,367		3,658,310
Diluted weighted average shares of common stock outstanding		17,752,290	$	4,895,694		17,747,612		3,658,310
Basic earnings per common share	$	0.55	$	0.83	$	1.42	$	1.40
Diluted earnings per common share	$	0.55	$	0.83	$	1.41	$	1.40

Dividends and Distributions (Tables)

9 Months Ended

Sep. 30, 2022

Dividends And Distributions Abstract

Schedule of dividends declared

	Record Date	Payment Date	Common Share Distribution Amount		Taxable Ordinary Income		Return of Capital		Section 199A Dividends
Regular cash dividend	3/31/2022	4/14/2022	$	0.40	$	0.40	$	-	$	0.40
Regular cash dividend	6/30/2022	7/15/2022	$	0.47	$	0.47	$	-	$	0.47
Regular cash dividend	9/30/2022	10/14/2022	$	0.47	$	0.47	$	-	$	0.47
Total cash dividend			$	1.34	$	1.34	$	-	$	1.34

Loans Held For Investment, Net (Details) - USD ($)	3 Months Ended	9 Months Ended	12 Months Ended
Loans Held For Investment, Net (Details) - USD ($)	Sep. 30, 2022	Sep. 30, 2022	Dec. 31, 2021
Loans Held For Investment, Net (Details) [Line Items]
Aggregate loan commitments	$ 348,900,000	$ 348,900,000
Outstanding principal	334,500,000	334,500,000	$ 200,600,000
New loan principal	$ 5,700,000	$ 143,600,000
Portfolio percentage	59.70%	59.70%	53.20%
Loan carrying value	$ 134,800,000	$ 134,800,000	$ 93,900,000
RemainingPortfolioPercentage		40.30%	46.80%
Interest rate	2.00%	2.00%
Interest rate	39.00%	39.00%
Aggregate fair value	$ 328,984,374	$ 328,984,374	$ 197,901,779
Gross proceeds		$ 2,091,173	917,213
Weight-average discount rates	17.54%	17.54%
Interest eceivable	$ 727,279	$ 727,279
Minimum [Member]
Loans Held For Investment, Net (Details) [Line Items]
Weight-average discount rates	11.36%	11.36%
Maximum [Member]
Loans Held For Investment, Net (Details) [Line Items]
Weight-average discount rates	24.79%	24.79%
London Inter-bank [Member]
Loans Held For Investment, Net (Details) [Line Items]
Loan carrying value	$ 199,700,000	$ 199,700,000	106,700,000
PIK Intial rate [Member]
Loans Held For Investment, Net (Details) [Line Items]
Aggregate loan	15,900,000	15,900,000
Twenty-one [Member]
Loans Held For Investment, Net (Details) [Line Items]
Aggregate loan commitments			$ 235,100,000
Debt [Member] \| First Advance [Member]
Loans Held For Investment, Net (Details) [Line Items]
Aggregate loan	$ 4,005,000.000	$ 4,005,000.000
Interest rate	15.25%	15.25%
Debt [Member] \| Second Advance [Member]
Loans Held For Investment, Net (Details) [Line Items]
Aggregate loan	$ 15,995,000	$ 15,995,000
Interest rate	9.75%	9.75%
Debt [Member] \| Third Advance [Member]
Loans Held For Investment, Net (Details) [Line Items]
Aggregate loan	$ 10,000,000	$ 10,000,000
Interest rate	8.50%	8.50%
Base Three [Member] \| Loans [Member]
Loans Held For Investment, Net (Details) [Line Items]
Aggregate loan	$ 10,000,000	$ 10,000,000
Interest rate	15.00%	15.00%
Second Commitment [Member]
Loans Held For Investment, Net (Details) [Line Items]
Aggregate loan	$ 2,000,000	$ 2,000,000
Two Consecutive [Member]
Loans Held For Investment, Net (Details) [Line Items]
Borrower percentage		2.00%
Base Ten [Member] \| One Commitment [Member]
Loans Held For Investment, Net (Details) [Line Items]
Interest rate	13.625%	13.625%
PIK [Member]
Loans Held For Investment, Net (Details) [Line Items]
Interest rate	2.75%	2.75%
PIK Equal Rate [Member]
Loans Held For Investment, Net (Details) [Line Items]
Aggregate loan	$ 4,200,000	$ 4,200,000
Interest rate	15.00%	15.00%

Loans Held For Investment, Net (Details) - Schedule of loans held for investment - USD ($)

9 Months Ended

Sep. 30, 2022

Dec. 31, 2021

Loans Held For Investment, Net (Details) - Schedule of loans held for investment [Line Items]

Total loans held at carrying value, Outstanding Principal

^[1]

$ 334,502,935

$ 200,632,056

Total loans held at carrying value, Original Issue Discount

(3,427,388)

(3,647,490)

Total loans held at carrying value, Carrying Value

^[1]

329,577,614

196,850,024

Senior Term Loans [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held for investment [Line Items]

Total loans held at carrying value, Outstanding Principal

^[1]

334,502,935

200,632,056

Total loans held at carrying value, Original Issue Discount

(3,427,388)

(3,647,490)

Total loans held at carrying value, Carrying Value

^[1]

$ 331,075,547

$ 196,984,566

Total loans held at carrying value, Weighted Average Remaining Life (Years)

^[2]

2 years 1 month 6 days

2 years 2 months 12 days

Current expected credit loss reserve [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held for investment [Line Items]

Total loans held at carrying value, Outstanding Principal

^[1]

Total loans held at carrying value, Original Issue Discount

Total loans held at carrying value, Carrying Value

^[1]

$ (1,497,933)

$ (134,542)

[1]	The difference between the Carrying Value and the Outstanding Principal amount of the loans consists of unaccreted original issue discount, deferred loan fees and other upfront fees. Outstanding principal balance includes capitalized PIK interest, if applicable.
[2]	Weighted average remaining life is calculated based on the carrying value of the loans as of September 30, 2022 and December 31, 2021, respectively.

Loans Held For Investment, Net (Details) - Schedule of changes in loans held at carrying value - USD ($)

6 Months Ended

9 Months Ended

Sep. 30, 2021

Sep. 30, 2022

Principal [Member]

Debt Instrument [Line Items]

Principal Loans, Beginning

^[1]

$ 200,632,056

Principal, Ending

^[1]

129,238,217

334,502,935

Principal Issuance of and funding of loans

^[1]

143,624,312

Principal Loans contributed

^[1]

32,589,907

Principal New fundings

^[1]

105,952,844

Principal repayment of loans

^[1]

(9,582,613)

(6,892,654)

Principal Accretion of original issue discount

^[1]

Principal Sale of loans

^[1]

(6,957,500)

Principal PIK Interest

^[1]

278,079

4,096,721

Principal Current expected credit loss reserve

^[1]

Original Issue Discount [Member]

Debt Instrument [Line Items]

Original Issue Discount, Beginning

(3,647,490)

Original Issue Discount, Ending

(2,115,053)

(3,427,388)

Original Issue Discount Issuance of and funding of loans

(2,180,593)

Original Issue Discount contributed

(613,391)

Original Issue Discount New fundings

(1,778,500)

Original Issue Discount Principal repayment of loans

Original Issue Discount Accretion of original issue discount

276,838

2,139,972

Original Issue Discount Sale of loans

260,723

Original Issue Discount PIK Interest

Original Issue Discount Current expected credit loss reserve

Current Expected Credit Loss Reserve [Member]

Debt Instrument [Line Items]

Current Expected Credit Loss Reserve, Beginning

(134,542)

Current Expected Credit Loss Reserve, Ending

(1,497,933)

Current Expected Credit Loss Reserve Issuance of and funding of loans

Current Expected Credit Loss Reserve Loans contributed

Current Expected Credit Loss Reserve New fundings

Current Expected Credit Loss Reserve Principal repayment of loans

Current Expected Credit Loss Reserve Accretion of original issue discount

Current Expected Credit Loss Reserve Sale of loans

Current Expected Credit Loss Reserve PIK Interest

Current Expected Credit Loss Reserve Current expected credit loss reserve

(1,363,391)

Carrying Value [Member]

Debt Instrument [Line Items]

Carrying Value, Beginning

^[1]

196,850,024

Carrying Value, Ending

^[1]

127,123,164

329,577,614

Carrying Value Issuance of and funding of loans

^[1]

141,443,719

Carrying Value Loans contributed

^[1]

31,976,516

Carrying Value New fundings

^[1]

104,174,344

Carrying Value Principal repayment of loans

^[1]

(9,582,613)

(6,892,654)

Carrying Value Accretion of original issue discount

^[1]

276,838

2,139,972

Carrying Value Sale of loans

^[1]

(6,696,777)

Carrying Value PIK Interest

^[1]

$ 278,079

4,096,721

Carrying Value Current expected credit loss reserve

^[1]

$ (1,363,391)

[1]	The difference between the Carrying Value and the Outstanding Principal amount of the loans consists of unaccreted original issue discount, deferred loan fees and other upfront fees. Outstanding principal balance includes capitalized PIK interest, if applicable.

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information

9 Months Ended

Sep. 30, 2022

USD ($)

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Outstanding Principal

$ 334,502,935

^[1]

Original Issue Premium/(Discount)

(3,427,388)

Carrying Value

$ 329,577,614

^[1]

Various [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Various(6)

^[2]

Outstanding Principal

$ 30,000,000

^[1]

Original Issue Premium/(Discount)

(287,746)

Carrying Value

$ 29,712,254

^[1]

Contractual Interest Rate

10.07%(7)

^[3],[4]

Maturity Date

5/30/2023

^[5]

Payment Terms

I/O

^[6]

Initial Funding Date

7/2/2020

^[1]

Michigan [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Michigan

Outstanding Principal

$ 36,646,551

^[1]

Original Issue Premium/(Discount)

(182,125)

Carrying Value

$ 36,464,426

^[1]

Contractual Interest Rate

P + 6.65%(5)(11) Cash, 3.25% PIK

^[3],[7],[8]

Maturity Date

12/31/2024

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

3/5/2021

^[1]

Various [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Various(6)

^[2]

Outstanding Principal

$ 20,673,831

^[1]

Original Issue Premium/(Discount)

(444,457)

Carrying Value

$ 20,229,374

^[1]

Contractual Interest Rate

13.91% Cash, 2.59% PIK(10)

^[3],[9]

Maturity Date

11/29/2024

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

3/25/2021

^[1]

Arizona [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Arizona

Outstanding Principal

$ 11,909,539

^[1]

Original Issue Premium/(Discount)

Carrying Value

$ 11,909,539

^[1]

Contractual Interest Rate

19.01%(8)

^[3],[10]

Maturity Date

12/31/2023

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

4/19/2021

^[1]

Massachusetts [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Massachusetts

Outstanding Principal

$ 1,500,000

^[1]

Original Issue Premium/(Discount)

Carrying Value

$ 1,500,000

^[1]

Contractual Interest Rate

P + 12.25%(5)

^[3],[8]

Maturity Date

4/30/2023

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

4/19/2021

^[1]

Pennsylvania [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Pennsylvania

Outstanding Principal

$ 13,263,665

^[1]

Original Issue Premium/(Discount)

Carrying Value

$ 13,263,665

^[1]

Contractual Interest Rate

P + 10.75%(5) Cash, 4% PIK(9)

^[3],[8],[11]

Maturity Date

5/31/2025

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

5/28/2021

^[1]

Michigan [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Michigan

Outstanding Principal

$ 4,443,750

^[1]

Original Issue Premium/(Discount)

(5,558)

Carrying Value

$ 4,438,192

^[1]

Contractual Interest Rate

P + 9.00%(5)

^[3],[8]

Maturity Date

2/20/2024

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

8/20/2021

^[1]

Various [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Various(6)

^[2]

Outstanding Principal

$ 23,168,151

^[1]

Original Issue Premium/(Discount)

(242,929)

Carrying Value

$ 22,925,222

^[1]

Contractual Interest Rate

13% Cash, 2.5% PIK

^[3]

Maturity Date

6/30/2025

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

8/24/2021

^[1]

West Virginia [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

West Virginia

Outstanding Principal

$ 9,554,960

^[1]

Original Issue Premium/(Discount)

(121,586)

Carrying Value

$ 9,433,374

^[1]

Contractual Interest Rate

P + 9.25%(5) Cash, 2% PIK

^[3],[8]

Maturity Date

9/1/2024

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

9/1/2021

^[1]

Pennsylvania [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Pennsylvania

Outstanding Principal

$ 15,536,102

^[1]

Original Issue Premium/(Discount)

Carrying Value

$ 15,536,102

^[1]

Contractual Interest Rate

P + 10.75%(5) Cash, 3% PIK

^[3],[8]

Maturity Date

6/30/2024

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

9/3/2021

^[1]

Michigan [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Michigan

Outstanding Principal

$ 313,607

^[1]

Original Issue Premium/(Discount)

Carrying Value

$ 313,607

^[1]

Contractual Interest Rate

11.00%

^[3]

Maturity Date

9/30/2024

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

9/20/2021

^[1]

Maryland [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Maryland

Outstanding Principal

$ 32,479,495

^[1]

Original Issue Premium/(Discount)

(714,967)

Carrying Value

$ 31,764,528

^[1]

Contractual Interest Rate

P + 8.75%(5) Cash, 2% PIK

^[3],[8]

Maturity Date

9/30/2024

^[5]

Payment Terms

I/O

^[6]

Initial Funding Date

9/30/2021

^[1]

Various [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Various(6)

^[2]

Outstanding Principal

$ 20,000,000

^[1]

Original Issue Premium/(Discount)

(210,110)

Carrying Value

$ 19,789,890

^[1]

Contractual Interest Rate

13.00%

^[3]

Maturity Date

10/31/2024

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

11/8/2021

^[1]

Michigan [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Michigan

Outstanding Principal

$ 10,600,000

^[1]

Original Issue Premium/(Discount)

(22,487)

Carrying Value

$ 10,577,513

^[1]

Contractual Interest Rate

P + 7.00%(5)

^[3],[8]

Maturity Date

11/22/2022

^[5]

Payment Terms

I/O

^[6]

Initial Funding Date

11/22/2021

^[1]

Various [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Various(6)

^[2]

Outstanding Principal

$ 5,000,000

^[1]

Original Issue Premium/(Discount)

Carrying Value

$ 5,000,000

^[1]

Contractual Interest Rate

15% Cash, 2.5% PIK

^[3]

Maturity Date

12/27/2026

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

12/27/2021

^[1]

Michigan [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Michigan

Outstanding Principal

$ 3,739,861

^[1]

Original Issue Premium/(Discount)

(56,096)

Carrying Value

$ 3,683,765

^[1]

Contractual Interest Rate

10.50% Cash, 5% PIK

^[3]

Maturity Date

12/29/2023

^[5]

Payment Terms

I/O

^[6]

Initial Funding Date

12/29/2021

^[1]

Various [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Various(6)

^[2]

Outstanding Principal

$ 7,500,000

^[1]

Original Issue Premium/(Discount)

(56,267)

Carrying Value

$ 7,443,733

^[1]

Contractual Interest Rate

P + 9.25%(5)

^[3],[8]

Maturity Date

12/31/2024

^[5]

Payment Terms

I/O

^[6]

Initial Funding Date

12/30/2021

^[1]

Florida [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Florida

Outstanding Principal

$ 15,000,000

^[1]

Original Issue Premium/(Discount)

(293,989)

Carrying Value

$ 14,706,011

^[1]

Contractual Interest Rate

11.00%

^[3]

Maturity Date

1/31/2025

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

1/18/2022

^[1]

Ohio [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Ohio

Outstanding Principal

$ 30,602,729

^[1]

Original Issue Premium/(Discount)

(472,079)

Carrying Value

$ 30,130,650

^[1]

Contractual Interest Rate

P + 8.25%(5) Cash, 3% PIK

^[3],[8]

Maturity Date

2/28/2025

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

2/3/2022

^[1]

Florida [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Florida

Outstanding Principal

$ 20,327,703

^[1]

Original Issue Premium/(Discount)

(84,518)

Carrying Value

$ 20,243,185

^[1]

Contractual Interest Rate

11.00% Cash, 3% PIK

^[3]

Maturity Date

8/29/2025

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

3/11/2022

^[1]

Missouri [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Missouri

Outstanding Principal

$ 17,204,978

^[1]

Original Issue Premium/(Discount)

(148,084)

Carrying Value

$ 17,056,894

^[1]

Contractual Interest Rate

11.00% Cash, 3% PIK

^[3]

Maturity Date

5/30/2025

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

5/9/2022

^[1]

Illinois [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Location

Illinois

Outstanding Principal

$ 5,038,013

^[1]

Original Issue Premium/(Discount)

(84,390)

Carrying Value

$ 4,953,623

^[1]

Contractual Interest Rate

P + 8.50% Cash, 3%(5) PIK

^[3],[8]

Maturity Date

6/30/2026

^[5]

Payment Terms

P&I

^[6]

Initial Funding Date

7/1/2022

^[1]

Current expected credit loss reserve [Member]

Loans Held For Investment, Net (Details) - Schedule of loans held at carrying value based on information [Line Items]

Outstanding Principal

^[1]

Original Issue Premium/(Discount)

Carrying Value

$ (1,497,933)

^[1]

[1]	The difference between the Carrying Value and the Outstanding Principal amount of the loans consists of unaccreted original issue discounts, deferred loan fees and other upfront fees. Outstanding principal balance includes capitalized PIK interest, if applicable.
[2]	Loans with material collateral in multiple jurisdictions, namely multi-state operators, are disclosed as “various.”
[3]	P = prime rate and depicts floating rate loans that pay interest at the prime rate plus a specific percentage; “PIK” = paid in kind interest.
[4]	The aggregate loan commitment to Loan #1 includes a $4.005 million initial advance, which has an interest rate of 15.25%, a second advance of $15.995 million, which has an interest rate of 9.75%, and a third advance of $10.0 million, which has an interest rate of 8.50%. The statistics presented reflect the weighted average of the terms under all three advances for the total aggregate loan commitment.
[5]	Certain loans are subject to contractual extension options and may be subject to performance based on other conditions as stipulated in the loan agreement. Actual maturities may differ from contractual maturities stated herein as certain borrowers may have the right to prepay with or without a contractual prepayment penalty. The Company may also extend contractual maturities and amend other terms of the loans in connection with loan modifications.
[6]	P&I = principal and interest. I/O = interest only. P&I loans may include interest only periods for a portion of the loan term.
[7]	This Loan is subject to an interest rate cap.
[8]	This Loan is subject to prime rate floor.
[9]	The aggregate loan commitment to Loan #3 includes a $15.9 million initial advance, which has a base interest rate of 13.625%, 2.75% PIK and a second advance of $4.2 million, which has an interest rate of 15.00%, 2.00% PIK. The statistics presented reflect the weighted average of the terms under both advances for the total aggregate loan commitment.
[10]	The aggregate loan commitment to Loan #4 includes a $10.0 million initial advance, which has a base interest rate of 15.00%, and a second advance of $2.0 million, which has an interest rate of 39%. The statistics presented reflect the weighted average of the terms under both advances for the total aggregate loan commitment.
[11]	Subject to adjustment not below 2% if borrower receives at least two consecutive quarters of positive cash flow after the closing date.

Loans Held For Investment, Net (Details) - Schedule of risk rating	6 Months Ended
	Jun. 30, 2022
Risk Rating One [Member]
Loans Held For Investment, Net (Details) - Schedule of risk rating [Line Items]
Risk rating	Very low risk
Risk Rating Two [Member]
Loans Held For Investment, Net (Details) - Schedule of risk rating [Line Items]
Risk rating	Low risk
Risk Rating Three [Member]
Loans Held For Investment, Net (Details) - Schedule of risk rating [Line Items]
Risk rating	Moderate/average risk
Risk Rating Four [Member]
Loans Held For Investment, Net (Details) - Schedule of risk rating [Line Items]
Risk rating	High risk/potential for loss: a loan that has a risk of realizing a principal loss
Risk Rating Five [Member]
Loans Held For Investment, Net (Details) - Schedule of risk rating [Line Items]
Risk rating	Impaired/loss likely: a loan that has a high risk of realizing principal loss, has incurred principal loss or an impairment has been recorded

Loans Held For Investment, Net (Details) - Schedule of carrying value of loans held for investment - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Schedule of Investments [Line Items]
Risk Rating 1	$ 50,255,235	$ 167,908,805
Risk Rating 2	173,243,442	29,075,761
Risk Rating 3	107,576,870
Risk Rating 4
Risk Rating 5
Total	331,075,547	196,984,566
2022 [Member]
Schedule of Investments [Line Items]
Risk Rating 1
Risk Rating 2	93,424,139
Risk Rating 3	30,130,650
Risk Rating 4
Risk Rating 5
Total	123,554,789
2021 [Member]
Schedule of Investments [Line Items]
Risk Rating 1	20,542,981	135,076,307
Risk Rating 2	79,819,303	29,075,761
Risk Rating 3	77,446,220
Risk Rating 4
Risk Rating 5
Total	177,808,504	164,152,068
2020 [Member]
Schedule of Investments [Line Items]
Risk Rating 1	29,712,254	32,242,114
Risk Rating 2
Risk Rating 3
Risk Rating 4
Risk Rating 5
Total	29,712,254	32,242,114
2019 [Member]
Schedule of Investments [Line Items]
Risk Rating 1		590,384
Risk Rating 2
Risk Rating 3
Risk Rating 4
Risk Rating 5
Total		$ 590,384

Loans Held For Investment, Net (Details) - Schedule of real estate collateral coverage - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
1.0x [Member]
Loans Held For Investment, Net (Details) - Schedule of real estate collateral coverage [Line Items]
Fixed-rate	$ 5,000,000	$ 7,017,793
Floating-rate	8,943,733	8,925,068
Net real estate collateral coverage	13,943,733	15,942,861
1.0 - 1.25 [member]
Loans Held For Investment, Net (Details) - Schedule of real estate collateral coverage [Line Items]
Fixed-rate
Floating-rate	97,660,654	18,022,518
Net real estate collateral coverage	97,660,654	18,022,518
1.25x - 1.5x [Member]
Loans Held For Investment, Net (Details) - Schedule of real estate collateral coverage [Line Items]
Fixed-rate	20,243,185	35,836,099
Floating-rate
Net real estate collateral coverage	20,243,185	35,836,099
1.50x - 1.75x [Member]
Loans Held For Investment, Net (Details) - Schedule of real estate collateral coverage [Line Items]
Fixed-rate	17,056,894	3,086,298
Floating-rate	31,920,426	30,029,953
Net real estate collateral coverage	48,977,320	33,116,251
1.75x - 2.0x [Member]
Loans Held For Investment, Net (Details) - Schedule of real estate collateral coverage [Line Items]
Fixed-rate
Floating-rate	13,263,665	32,377,087
Net real estate collateral coverage	13,263,665	32,377,087
> 2.0x [Member]
Loans Held For Investment, Net (Details) - Schedule of real estate collateral coverage [Line Items]
Fixed-rate	91,130,749	45,373,778
Floating-rate	45,856,241	16,315,972
Net real estate collateral coverage	136,986,990	61,689,750
Total [Member]
Loans Held For Investment, Net (Details) - Schedule of real estate collateral coverage [Line Items]
Fixed-rate	133,430,828	91,313,968
Floating-rate	197,644,719	105,670,598
Net real estate collateral coverage	$ 331,075,547	$ 196,984,566

Loans Held For Investment, Net (Details) - Schedule of activity related to the CECL Reserve for outstanding balances

9 Months Ended

Sep. 30, 2022

USD ($)

Accounts, Notes, Loans and Financing Receivable [Line Items]

Balance

$ 147,949

Balance

1,551,841

Provision for current expected credit losses

1,403,892

Write-off charged

Recoveries

Outstanding [Member]

Accounts, Notes, Loans and Financing Receivable [Line Items]

Balance

134,542

^[1]

Balance

1,497,933

^[1]

Provision for current expected credit losses

1,363,391

^[1]

Write-off charged

^[1]

Recoveries

^[1]

Unfunded [Member]

Accounts, Notes, Loans and Financing Receivable [Line Items]

Balance

13,407

^[2]

Balance

53,908

^[2]

Provision for current expected credit losses

40,501

^[2]

Write-off charged

^[2]

Recoveries

^[2]

[1]	As of September 30, 2022, the CECL Reserve related to outstanding balances on loans at carrying value is recorded within current expected credit loss reserve in the Company’s consolidated balance sheets.
[2]	As of September 30, 2022, the CECL Reserve related to unfunded commitments on loans at carrying value is recorded within accounts payable and accrued liabilities in the Company’s consolidated balance sheets.

Loans Held For Investment, Net (Details) - Schedule of Provision for current expected credit losses - USD ($)	3 Months Ended			9 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2022
Outstanding [Member]
Loans Held For Investment, Net (Details) - Schedule of Provision for current expected credit losses [Line Items]
Balance	$ 1,203,424	$ 182,838	$ 134,542	$ 134,542
Provision for current expected credit losses	294,509	1,020,586	48,296
Balance	1,497,933	1,203,424	182,838	1,497,933
Unfunded [Member]
Loans Held For Investment, Net (Details) - Schedule of Provision for current expected credit losses [Line Items]
Balance	41,533	16,454	13,407	13,407
Provision for current expected credit losses	12,375	25,079	3,047
Balance	$ 53,908	$ 41,533	$ 16,454	$ 53,908

Interest Receivable (Details) - Schedule of summarizes the interest receivable - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Schedule Of Summarizes The Interest Receivable Abstract
Interest receivable	$ 627,709	$ 193,790
PIK interest receivable	95,139
Unused fees receivable	4,431	3,945
Total interest receivable	$ 727,279	$ 197,735

Interest Reserve (Details) - Schedule of changes in interest reserves - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Schedule Of Changes In Interest Reserves Abstract
Initial reserves	$ 6,636,553
New reserves	8,929,716	9,223,802
Reserves disbursed	(9,940,290)	(2,587,249)
Total interest reserve	$ 5,625,979	$ 6,636,553

Debt (Details) - USD ($)					3 Months Ended	9 Months Ended
Debt (Details) - USD ($)	Jul. 02, 2022	Dec. 16, 2021	May 31, 2021	May 12, 2021	Sep. 30, 2022	Sep. 30, 2022	Dec. 31, 2021
Debt (Details) [Line Items]
Aggregate borrowing			$ 10,000,000
Incurred debt issuance costs		$ 859,500	$ 100,000	$ 177,261
Debt to equity, description		On December 16, 2021, the Company amended the Revolving Loan Agreement (the “First Amendment”). The First Amendment increased the loan commitment from $10,000,000 to $45,000,000 and decreased the interest rate, from the greater of the (1) Prime Rate plus 1.00% and (2) 4.75% to the greater of (1) the Prime Rate plus the applicable margin and (2) 3.25%. The applicable margin is derived from a floating rate grid based upon the ratio of debt to equity of CAL and increases from 0% at a ratio of 0.25 to 1 to 1.25% at a ratio of 1.5 to 1. The First Amendment also extended the maturity date from February 12, 2023 to the earlier of (i) December 16, 2023 and (ii) the date on which the Revolving Loan is terminated pursuant to the terms of the Revolving Loan agreement.
Unamortized debt issuance costs					$ 665,639	$ 665,639	$ 868,022
Interest expense					861,348	$ 1,383,172
Debt description						Additionally, the Company must comply with certain financial covenants including: (1) maximum capital expenditures of $150,000, (2) maintaining a debt service coverage ratio greater than 1.35 to 1, and (3) maintaining a leverage ratio less than 1.50 to 1. As of September 30, 2022, we were in compliance with all financial covenants with respect to the Revolving Loan.
Minimum [Member]
Debt (Details) [Line Items]
Prime rate plus percentage			1.00%
Loan commitment				45,000,000
Maximum [Member]
Debt (Details) [Line Items]
Prime rate plus percentage			4.75%
Loan commitment				$ 65,000,000
Revolving Loan [Member]
Debt (Details) [Line Items]
Unused fees rate	0.25%
Borrowed					$ 53,000,000	$ 53,000,000
Interest expense						$ 991,694

Debt (Details) - Schedule of summary of interest expense incurred during period - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2022
Schedule Of Summary Of Interest Expense Incurred During Period Abstract
Interest expense	$ 715,132	$ 991,694
Unused fee expense	7,667	11,834
Amortization of deferred financing costs	138,549	379,644
Total interest expense	$ 861,348	$ 1,383,172

Related Party Transactions (Details) - USD ($)		3 Months Ended	9 Months Ended
Related Party Transactions (Details) - USD ($)	Jul. 08, 2022	Sep. 30, 2022	Sep. 30, 2022	Aug. 04, 2022	Dec. 31, 2021
Related Party Transactions (Details) [Line Items]
Management fees, percentage			0.375%
Origination fees, percentage			50.00%
Outside fees		$ 192,751	$ 1,275,001
Incentive compensation		519,223	1,500,129
Accounts payable		$ 2,600,000	$ 2,600,000		$ 2,700,000
Unfunded commitment				$ 10,000,000
Level 3 [Member]
Related Party Transactions (Details) [Line Items]
Selling price	$ 6,700,000

Related Party Transactions (Details) - Schedule of summarizes the related party costs - USD ($)	3 Months Ended		6 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Schedule Of Summarizes The Related Party Costs Abstract
Management fees earned	$ 1,020,949		$ 3,041,359
Less: Outside fees earned	(192,751)		(1,275,001)
Base management fee, net	828,198		1,766,358
Incentive fees	519,223		1,500,129
Total management and incentive fees earned	1,347,421		3,266,487
General and administrative expenses reimbursable to Manager	980,949		2,132,419
Total	$ 2,328,370		$ 5,398,906

Commitments and Contingencies (Details) - Schedule of commitments to fund various existing loans - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Schedule Of Commitments To Fund Various Existing Loans Abstract
Total original loan commitments	$ 348,867,706	$ 235,063,593
Less: drawn commitments	(330,384,897)	(200,359,026)
Total undrawn commitments	$ 18,482,809	$ 34,704,567

Stockholders' Equity (Details) - USD ($)			1 Months Ended	6 Months Ended	9 Months Ended
Stockholders' Equity (Details) - USD ($)	Jan. 05, 2022	Dec. 10, 2021	Oct. 21, 2021	Sep. 30, 2021	Sep. 30, 2022	Dec. 31, 2021
Stockholders' Equity Note [Abstract]
Underwriters shares purchase (in Shares)	302,800
Common stock price par value (in Dollars per share)	$ 16
Additional gross proceeds	$ 4,844,800
Additional net proceeds	4,505,664
Underwriting commissions	$ 339,136
Shares issued (in Shares)						10,636,363
Common stock shares issued (in Shares)		6,250,000
Common stock per share (in Dollars per share)		$ 16
IPO gross proceeds		$ 100,000,000
Underwriting commission		7,000,000
Expenses		1,265,877
Net proceeds		$ 91,734,123
Sold shares of common stock (in Shares)		468,750
Offering price, per share (in Dollars per share)		$ 16
Gross proceeds		$ 7,500,000
Stock split (in Shares)			6
Restricted common stock shares (in Shares)						98,440
Issued and outstanding shares percentage					8.50%	8.50%
Shares forfeited (in Shares)					13,438
Share-based compensation expense				$ 0	$ 328,356
Unamortized share-based compensation expense					$ 1,000,000

Stockholders' Equity (Details) - Schedule of restricted stock activity - shares	9 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Schedule Of Restricted Stock Activity Abstract
Non-vested	98,440	98,440
Forfeited	(13,438)
Balance	85,002	98,440

Earnings Per Share (Details) - Schedule of basic earnings per common share - USD ($)	3 Months Ended		6 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2021	Sep. 30, 2022
Schedule Of Basic Earnings Per Common Share Abstract
Net income attributable to common stockholders	$ 9,768,969	$ 4,067,521	$ 5,136,072	$ 25,036,760
Divided by:
Basic weighted average shares of common stock outstanding	17,657,913	4,895,694	3,658,310	17,652,367
Diluted weighted average shares of common stock outstanding	17,752,290	4,895,694	3,658,310	17,747,612
Basic earnings per common share	$ 0.55	$ 0.83	$ 1.4	$ 1.42
Diluted earnings per common share	$ 0.55	$ 0.83	$ 1.4	$ 1.41

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 65
-Paragraph 1
-Subparagraph (e)(4)
-URI https://asc.fasb.org/extlink&oid=126732423&loc=SL123482106-238011

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 3
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- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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+ Details

Income Tax (Details)	9 Months Ended
Income Tax (Details)	Sep. 30, 2022 USD ($)
Income Tax Disclosure [Abstract]
Income tax provision	$ 0

Dividends and Distributions (Details) - Schedule of dividends declared	9 Months Ended
	Sep. 30, 2022 USD ($) $ / shares
Regular cash dividend [Member]
Dividends and Distributions (Details) - Schedule of dividends declared [Line Items]
Record Date	Mar. 31, 2022
Payment Date	Apr. 14, 2022
Common Share Distribution Amount	$ 0.4
Taxable Ordinary Income	$ 0.4
Return of Capital (in Dollars) \| $
Section 199A Dividends	$ 0.4
Regular cash dividend One [Member]
Dividends and Distributions (Details) - Schedule of dividends declared [Line Items]
Record Date	Jun. 30, 2022
Payment Date	Jul. 15, 2022
Common Share Distribution Amount	$ 0.47
Taxable Ordinary Income	$ 0.47
Return of Capital (in Dollars) \| $
Section 199A Dividends	$ 0.47
Regular cash dividend Two [Member]
Dividends and Distributions (Details) - Schedule of dividends declared [Line Items]
Record Date	Sep. 30, 2022
Payment Date	Oct. 14, 2022
Common Share Distribution Amount	$ 0.47
Taxable Ordinary Income	$ 0.47
Return of Capital (in Dollars) \| $
Section 199A Dividends	$ 0.47
Total cash dividend [Member]
Dividends and Distributions (Details) - Schedule of dividends declared [Line Items]
Common Share Distribution Amount	1.34
Taxable Ordinary Income	$ 1.34
Return of Capital (in Dollars) \| $
Section 199A Dividends	$ 1.34

Subsequent Events (Details) - Subsequent Event [Member] - USD ($) $ in Millions	Nov. 09, 2022	Nov. 07, 2022	Oct. 27, 2022
Subsequent Events (Details) [Line Items]
Outstanding principal			$ 30.0
Aggregate commitment		$ 27.5
Revolving loan	$ 34.5
Minimum [Member]
Subsequent Events (Details) [Line Items]
Aggregate commitment		65.0
Maximum [Member]
Subsequent Events (Details) [Line Items]
Aggregate commitment		$ 92.5