Broadstone Net Lease, Inc. 10-Q

Item 1. Financial Statements Broadstone Net Lease, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) (in thousands, except per share amounts) March 31, 2026 December 31, 2025 Assets Accounted for using the operating method: Land $ 822,795 $ 781,117 Land improvements 381,795 373,405 Buildings and improvements 4,173,302 4,118,578 Equipment 15,324 15,281 Total accounted for using the operating method 5,393,216 5,288,381 Less accumulated depreciation ( 803,658 ) ( 772,589 ) Accounted for using the operating method, net 4,589,558 4,515,792 Accounted for using the direct financing method 25,303 25,497 Accounted for using the sales-type method 14,393 14,405 Property under development 329,260 265,812 Investment in rental property, net 4,958,514 4,821,506 Cash and cash equivalents 20,310 30,540 Accrued rental income 184,668 178,880 Tenant and other receivables, net 3,633 4,404 Prepaid expenses and other assets 56,183 55,910 Interest rate swap, assets 19,975 18,248 Goodwill 339,769 339,769 Intangible lease assets, net 261,975 268,010 Total assets $ 5,845,027 $ 5,717,267 Liabilities and equity Unsecured revolving credit facility $ 397,640 $ 266,036 Mortgages, net 56,197 56,689 Unsecured term loans, net 994,820 994,219 Senior unsecured notes, net 1,191,143 1,190,738 Interest rate swap, liabilities 637 1,501 Accounts payable and other liabilities 61,738 60,081 Dividends payable 59,884 59,513 Accrued interest payable 21,759 13,502 Intangible lease liabilities, net 39,860 41,527 Total liabilities 2,823,678 2,683,806 Commitments and contingencies (Note 16) Equity Broadstone Net Lease, Inc. equity: Preferred stock, $ 0.001 par value; 20,000 shares authorized, no shares issued or outstanding — — Common stock, $ 0.00025 par value; 500,000 shares authorized, 191,771 and 191,423 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively 48 48 Additional paid-in capital 3,502,465 3,502,380 Cumulative distributions in excess of retained earnings ( 630,951 ) ( 620,221 ) Accumulated other comprehensive income 20,898 19,788 Total Broadstone Net Lease, Inc. equity 2,892,460 2,901,995 Non-controlling interests 128,889 131,466 Total equity 3,021,349 3,033,461 Total liabilities and equity $ 5,845,027 $ 5,717,267 The accompanying notes are an integral part of these condensed consolidated financial statements. 1 Broadstone Net Lease, Inc. and Subsidiaries Condensed Consolidated Statements of Income and Comprehensive Income (Loss) (Unaudited) (in thousands, except per share amounts) For the Three Months Ended March 31, 2026 2025 Revenues Lease revenues, net $ 121,401 $ 108,690 Operating expenses Depreciation and amortization 41,526 39,497 Property and operating expense 6,180 5,488 General and administrative 10,349 9,672 Provision for impairment of investment in rental properties — 16,128 Total operating expenses 58,055 70,785 Other income (expenses) Interest income 49 99 Interest expense ( 25,260 ) ( 20,074 ) Gain on sale of real estate 7,122 405 Income taxes ( 311 ) ( 355 ) Other income (expenses) 1,446 ( 487 ) Net income 46,392 17,493 Net income attributable to non-controlling interests ( 27 ) ( 750 ) Net income attributable to Broadstone Net Lease, Inc. 46,365 16,743 Weighted average number of common shares outstanding Basic 190,435 187,865 Diluted 199,754 196,898 Net earnings per share attributable to common stockholders Basic and Diluted $ 0.24 $ 0.09 Comprehensive income (loss) Net income $ 46,392 $ 17,493 Other comprehensive income (loss) Change in fair value of interest rate swaps 2,591 ( 19,892 ) Realized loss (gain) on interest rate swaps 31 ( 6 ) Comprehensive income (loss) 49,014 ( 2,405 ) Comprehensive (income) loss attributable to non-controlling interests ( 136 ) 103 Comprehensive income (loss) attributable to Broadstone Net Lease, Inc. $ 48,878 $ ( 2,302 ) The accompanying notes are an integral part of these condensed consolidated financial statements. 2 Broadstone Net Lease, Inc. and Subsidiaries Condensed Consolidated Statements of Equity (Unaudited) (in thousands, except per share amounts) Common Stock Additional Paid-in Capital Cumulative Distributions in Excess of Retained Earnings Accumulated Other Comprehensive Income Non- controlling Interests Total Equity Balance at January 1, 2026 $ 48 $ 3,502,380 $ ( 620,221 ) $ 19,788 $ 131,466 $ 3,033,461 Net income — — 46,365 — 27 46,392 Issuance of 619 shares of common stock under equity incentive plan — 1,053 — — — 1,053 Contributions from non-controlling interests — — — — 43 43 Stock-based compensation — 2,566 — — — 2,566 Retirement of 271 shares of common stock under equity incentive plan — ( 5,183 ) — — — ( 5,183 ) Distributions declared ($ 0.2925 per share and OP Unit) — — ( 57,095 ) — ( 2,510 ) ( 59,605 ) Change in fair value of interest rate swap agreements — — — 2,483 108 2,591 Realized loss on interest rate swap agreements — — — 30 1 31 Adjustment of non-controlling interests — 1,649 — ( 1,403 ) ( 246 ) — Balance at March 31, 2026 $ 48 $ 3,502,465 $ ( 630,951 ) $ 20,898 $ 128,889 $ 3,021,349 Common Stock Additional Paid-in Capital Cumulative Distributions in Excess of Retained Earnings Accumulated Other Comprehensive Income Non- controlling Interests Total Equity Balance, January 1, 2025 $ 47 $ 3,450,584 $ ( 496,543 ) $ 49,657 $ 137,679 $ 3,141,424 Net income — — 16,743 — 750 17,493 Issuance of 292 shares of common stock under equity incentive plan — 104 — — — 104 Offering costs, discounts, and commissions — ( 136 ) — — — ( 136 ) Stock-based compensation, net of three shares of restricted stock forfeited — 2,147 — — — 2,147 Retirement of 86 shares of common stock under equity incentive plan — ( 1,446 ) — — — ( 1,446 ) Conversion of 244 OP Units to 244 shares of common stock — 3,882 — — ( 3,882 ) — Distributions declared ($ 0.29 per share and OP Unit) — — ( 56,274 ) — ( 2,600 ) ( 58,874 ) Change in fair value of interest rate swap agreements — — — ( 19,039 ) ( 853 ) ( 19,892 ) Realized gain on interest rate swap agreements — — — ( 6 ) — ( 6 ) Adjustment to non-controlling interests — 906 — ( 892 ) ( 14 ) — Balance, March 31, 2025 $ 47 $ 3,456,041 $ ( 536,074 ) $ 29,720 $ 131,080 $ 3,080,814 The accompanying notes are an integral part of these condensed consolidated financial statements. 3 Broadstone Net Lease, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited) (in thousands) For the Three Months Ended March 31, 2026 2025 Operating activities Net income $ 46,392 $ 17,493 Adjustments to reconcile net income including non-controlling interests to net cash provided by operating activities: Depreciation and amortization including intangibles associated with investment in rental property 40,511 38,433 Provision for impairment of investment in rental properties — 16,128 Amortization of debt issuance costs and original issuance discounts charged to interest expense 1,627 1,237 Stock-based compensation expense 2,566 2,147 Straight-line rent, direct financing and sales-type lease adjustments ( 5,630 ) ( 3,679 ) Gain on sale of real estate ( 7,122 ) ( 405 ) Other non-cash items ( 2,488 ) 470 Changes in assets and liabilities: Tenant and other receivables 771 700 Prepaid expenses and other assets ( 4,667 ) ( 36 ) Accounts payable and other liabilities ( 4,125 ) ( 4,591 ) Accrued interest payable 8,257 3,562 Net cash provided by operating activities 76,092 71,459 Investing activities Acquisition of rental property ( 59,014 ) ( 60,522 ) Investment in property under development including capitalized interest of $ 3,016 and $ 322 in 2026 and 2025, respectively ( 112,927 ) ( 16,687 ) Capital expenditures and improvements ( 1,364 ) ( 14,348 ) Proceeds from disposition of rental property, net 11,216 7,522 Change in deposits on investments in rental property ( 322 ) ( 1,300 ) Net cash used in investing activities ( 162,411 ) ( 85,335 ) Financing activities Offering costs, discounts, and commissions — ( 146 ) Contributions from non-controlling interests 43 — Proceeds from unsecured term loans — 400,000 Principal payments on mortgages and unsecured term loans ( 501 ) ( 400,596 ) Borrowings on unsecured revolving credit facility 212,500 145,300 Repayments on unsecured revolving credit facility ( 79,500 ) ( 64,500 ) Cash distributions paid to stockholders ( 55,692 ) ( 56,196 ) Cash distributions paid to non-controlling interests ( 2,489 ) ( 2,671 ) Debt issuance costs paid ( 5 ) ( 12,275 ) Net cash provided by financing activities 74,356 8,916 Net decrease in cash and cash equivalents and restricted cash ( 11,963 ) ( 4,960 ) Cash and cash equivalents and restricted cash at beginning of period 33,642 15,993 Cash and cash equivalents and restricted cash at end of period $ 21,679 $ 11,033 Reconciliation of cash and cash equivalents and restricted cash Cash and cash equivalents at beginning of period $ 30,540 $ 14,845 Restricted cash at beginning of period 3,102 1,148 Cash and cash equivalents and restricted cash at beginning of period $ 33,642 $ 15,993 Cash and cash equivalents at end of period $ 20,310 $ 9,605 Restricted cash at end of period 1,369 1,428 Cash and cash equivalents and restricted cash at end of period $ 21,679 $ 11,033 The accompanying notes are an integral part of these condensed consolidated financial statements. 4 Broadstone Net Lease, Inc. and Subsidiaries Notes to the Condensed Consolidated Financial Statements (Unaudited) 1. Business Description Broadstone Net Lease, Inc. (the “Corporation”) is a Maryland corporation formed on October 18, 2007, that elected to be taxed as a real estate investment trust (“REIT”) commencing with the taxable year ended December 31, 2008. Broadstone Net Lease, LLC (the Corporation’s operating company, or the “OP”), is the entity through which the Corporation conducts its business and owns (either directly or through subsidiaries) all of the Corporation’s properties. The Corporation is the sole managing member of the OP. The membership units not owned by the Corporation are referred to as “OP Units” and are recorded as non-controlling interests in the Condensed Consolidated Financial Statements. As the Corporation conducts substantially all of its operations through the OP, it is structured as an umbrella partnership real estate investment trust (“UPREIT”). The Corporation’s common stock is listed on the New York Stock Exchange under the symbol “BNL”. The Corporation, the OP, and its consolidated subsidiaries are collectively referred to as the “Company”. The Company is an industrial-focused, diversified net lease REIT that focuses on investing in income-producing, single-tenant net leased commercial properties, primarily in the United States. The Company leases primarily industrial and retail commercial properties under long-term lease agreements. At March 31, 2026, the Company owned a diversified portfolio of 773 individual commercial properties with 766 properties located in 44 U.S. states and seven properties located in four Canadian provinces. The following table summarizes the outstanding equity and economic ownership interest of the Company: (in thousands) March 31, 2026 December 31, 2025 Shares of Common Stock OP Units Total Diluted Shares Shares of Common Stock OP Units Total Diluted Shares Ownership interest 191,771 8,296 200,067 191,423 8,296 199,719 Percent ownership of OP 95.9 % 4.1 % 100.0 % 95.8 % 4.2 % 100.0 % Refer to Note 14 for further discussion regarding the calculation of weighted average shares outstanding. 2. Summary of Significant Accounting Policies Interim Information The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information (Accounting Standards Codification (“ASC”) 270, Interim Reporting ) and Article 10 of the Securities and Exchange Commission’s (“SEC”) Regulation S-X. Accordingly, the Company has omitted certain footnote disclosures which would substantially duplicate those contained within the audited consolidated financial statements for the year ended December 31, 2025, included in the Company’s 2025 Annual Report on Form 10-K, filed with the SEC on February 19, 2026. Therefore, the readers of this quarterly report should refer to those audited consolidated financial statements, specifically Note 2, Summary of Significant Accounting Policies , for further discussion of significant accounting policies and estimates. The Company believes all adjustments necessary for a fair presentation have been included in these interim Condensed Consolidated Financial Statements (which include only normal recurring adjustments). Basis of Accounting The Condensed Consolidated Financial Statements have been prepared in accordance with GAAP. Principles of Consolidation The Condensed Consolidated Financial Statements include the accounts and operations of the Company. All intercompany balances and transactions have been eliminated in consolidation. 5 When the Company obtains an economic interest in an entity, the entity is evaluated to determine if it should be deemed a variable interest entity (“VIE”) and, if so, whether the Company is the primary beneficiary and is therefore required to consolidate the entity. The accounting guidance for consolidation of VIEs is applied to certain entities in which the equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. Certain decision-making rights within a loan or joint-venture agreement may cause us to consider an entity a VIE. The contractual arrangements in a partnership agreement or other related contracts are reviewed to determine whether the entity is a VIE, and if the Company has variable interests in the VIE. The Company’s variable interests are then compared to those of the other variable interest holders to determine which party is the primary beneficiary of the VIE. A primary beneficiary: (i) has the power to direct the activities that most significantly impact the economic performance of the VIE and (ii) has the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. The Company reassesses the initial evaluation of whether an entity is a VIE when certain events occur, and reassesses the primary beneficiary determination of a VIE on an ongoing basis based on current facts and circumstances. To the extent the Company has a variable interest in entities that are not evaluated under the VIE model, the Company evaluates its interests using the voting interest entity model. The Corporation has complete responsibility for the day-to-day management of, authority to make decisions for, and control of the OP. Based on consolidation guidance, the Corporation has concluded that the OP is a VIE as the members in the OP do not possess kick-out rights or substantive participating rights. Accordingly, the Corporation consolidates its interest in the OP. However, because the Corporation holds the majority voting interest in the OP and certain other conditions are met, it qualifies for the exemption from providing certain disclosure requirements associated with investments in VIEs. The portions of a consolidated entity not owned by the Company are presented as non-controlling interests as of and during the periods presented. From time to time, the Company acquires properties using a reverse like-kind exchange structure pursuant to Section 1031 of the Internal Revenue Code (a “reverse 1031 exchange”) and, as such, the properties are in the possession of an Exchange Accommodation Titleholder (“EAT”) until the reverse 1031 exchange is completed. EATs are classified as VIEs as they are “thinly capitalized” entities. The Company consolidates the EAT because it is the primary beneficiary as it has the ability to control the activities that most significantly impact the EAT ’ s economic performance and can collapse the reverse 1031 exchange structure at its discretion. The assets of the EAT primarily consist of leased property (net real estate investment in rental property and lease intangibles). The Company invests in various entities in exchange for ownership interests. Each of these investments is a VIE in which the Company is considered the primary beneficiary as it: (i) has the power to direct the activities that significantly impact the economic performance of the VIE, and (ii) has the obligation to absorb losses and the right to receive benefits of the VIE. As a result, the Company consolidates these VIEs. At March 31, 2026 and December 31, 2025, the Company had six consolidated VIEs. 6 The following table presents a summary of selected financial data of the consolidated VIEs included in the Condensed Consolidated Balance Sheets: (in thousands) March 31, 2026 December 31, 2025 Assets Accounted for using the operating method: Land $ 7,644 $ 7,644 Land improvements 2,707 2,707 Buildings and improvements 40,664 40,664 Total accounted for using the operating method 51,015 51,015 Less accumulated depreciation ( 2,461 ) ( 2,131 ) Accounted for using the operating method, net 48,554 48,884 Property under development 130,282 114,094 Investment in rental property, net 178,836 162,978 Intangible lease assets, net 1,854 2,097 Other assets 14,169 17,825 Total assets $ 194,859 $ 182,900 Liabilities Intangible lease liabilities, net $ 403 $ 425 Other liabilities $ 1,357 $ 1,925 Total liabilities $ 1,760 $ 2,350 Use of Estimates The preparation of Condensed Consolidated Financial Statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting periods. Accordingly, actual results may differ from those estimates. Investment in Property Under Development Land acquired for development and construction and improvement costs incurred in connection with the development of new properties are capitalized and recorded as Property under development in the accompanying Condensed Consolidated Balance Sheets until construction has been completed. Such capitalized costs include all direct and indirect costs related to planning, development, and construction, including interest, real estate taxes, and other miscellaneous costs incurred during the construction period. Once substantially complete, the property under development is placed in service and depreciation commences. During the three months ended March 31, 2026 and 2025, the Company funded capital expenditures of $ 5.1 million and $ 10.4 million, respectively, on development properties after they have reached substantial completion. The following tables summarize the Company’s investments in property under development: (in thousands) March 31, 2026 December 31, 2025 Development, construction and improvement costs $ 323,404 $ 261,541 Capitalized interest 5,856 4,271 Property under development $ 329,260 $ 265,812 (in thousands) For the Three Months Ended March 31, 2026 2025 Investment in properties under development, excluding capitalized costs $ 109,951 $ 16,387 7 Long-lived Asset Impairment The Company reviews long-lived assets to be held and used for possible impairment when events or changes in circumstances indicate that their carrying amounts may not be recoverable. If, and when, such events or changes in circumstances are present, an impairment exists to the extent the carrying value of the long-lived asset or asset group exceeds the sum of the undiscounted cash flows expected to result from the use of the long-lived asset or asset group and its eventual disposition. Such cash flows include expected future operating income, as adjusted for trends and prospects, as well as the effects of demand, competition, and other factors. An impairment loss is measured as the amount by which the carrying amount of the long-lived asset or asset group exceeds its fair value. Significant judgment is made to determine if and when impairment should be taken. The Company’s assessment of impairment during the three months ended March 31, 2026 and 2025, was based on the most current information available to the Company. Certain of the Company’s properties may have fair values less than their carrying amounts. However, based on the Company’s plans with respect to each of those properties, the Company believes that their carrying amounts are recoverable and therefore, no impairment charges were recognized other than those described below. If the operating conditions mentioned above deteriorate or if the Company’s expected holding period for assets changes, subsequent tests for impairment could result in additional impairment charges in the future. Inputs used in establishing fair value for impaired real estate assets generally fall within Level 3 of the fair value hierarchy, which are characterized as requiring significant judgment as little or no current market activity may be available for validation. The main indicator used to establish the classification of the inputs is current market conditions, as derived through the use of published commercial real estate market information and information obtained from brokers and other third party sources. The Company determines the valuation of impaired assets using generally accepted valuation techniques including discounted cash flow analysis, income capitalization, analysis of recent comparable sales transactions, actual sales negotiations, and bona fide purchase offers received from third parties. Management may consider a single valuation technique or multiple valuation techniques, as appropriate, when estimating the fair value of its real estate. The following table summarizes the Company’s impairment charges, resulting primarily from changes in the Company’s long-term hold strategy with respect to the individual properties: (in thousands) For the Three Months Ended March 31, 2026 2025 Number of properties — 7 Impairment charge $ — $ 16,128 During the three months ended March 31, 2025, the Company recognized impairment of $ 16.1 million, resulting from changes in the Company’s long-term hold strategy with respect to the individual properties. The impairments were based on actual and expected sales prices of individual properties and includes a $ 12.5 million impairment charge on two healthcare properties. Restricted Cash Restricted cash generally includes escrow funds the Company maintains pursuant to the terms of certain mortgages, lease agreements, and undistributed proceeds from the sale of properties under Section 1031 of the Internal Revenue Code of 1986, as amended (the “Code”), and is reported within Prepaid expenses and other assets in the Condensed Consolidated Balance Sheets. Restricted cash consisted of the following: (in thousands) March 31, 2026 December 31, 2025 Escrow funds and other $ 1,369 $ 3,102 8 Rent Received in Advance Rent received in advance represents tenant rent payments received prior to the contractual due date, and is included in Accounts payable and other liabilities in the Condensed Consolidated Balance Sheets. Rent received in advance consisted of the following: (in thousands) March 31, 2026 December 31, 2025 Rent received in advance $ 24,245 $ 18,498 Segment Reporting The Company currently operates in a single reportable segment, which includes the acquisition, leasing, and ownership of net leased properties. The Company’s chief operating decision maker (“CODM”) is the Company’s senior leadership team, which includes, the Chief Executive Officer, President and Chief Operating Officer, Chief Financial Officer and Treasurer, and the Company’s Senior Vice Presidents. The CODM assesses, measures, and reviews the operating and financial results at the consolidated level for the entire portfolio based on consolidated revenues, expenses, and net income as reported on the Condensed Consolidated Statements of Income and Comprehensive Income. The Company does not evaluate the results of operations based on geography, size, or property type. Fair Value Measurements Recurring Fair Value Measurements The balances of financial instruments measured at fair value on a recurring basis are as follows (see Note 9): (in thousands) March 31, 2026 Total Level 1 Level 2 Level 3 Interest rate swap, assets $ 19,975 $ — $ 19,975 $ — Interest rate swap, liabilities ( 637 ) — ( 637 ) — (in thousands) December 31, 2025 Total Level 1 Level 2 Level 3 Interest rate swap, assets $ 18,248 $ — $ 18,248 $ — Interest rate swap, liabilities ( 1,501 ) — ( 1,501 ) — Long-term Debt – The fair value of the Company’s debt was estimated using Level 1, Level 2, and Level 3 inputs based on recent secondary market trades of the Company’s senior unsecured public notes, recent comparable financing transactions, recent market risk premiums for loans of comparable quality, Secured Overnight Financing Rate (“SOFR”), Canadian Overnight Repo Rate Average (“CORRA”), U.S. Treasury obligation interest rates, and discounted estimated future cash payments to be made on such debt. The discount rates estimated reflect the Company’s judgment as to the approximate current lending rates for loans or groups of loans with similar maturities and assumes that the debt is outstanding through maturity. Market information, as available, or present value techniques were utilized to estimate the amounts required to be disclosed. Since such amounts are estimates that are based on limited available market information for similar transactions and do not acknowledge transfer or other repayment restrictions that may exist on specific loans, it is unlikely that the estimated fair value of any such debt could be realized by immediate settlement of the obligation. The following table summarizes the carrying amount reported in the Condensed Consolidated Balance Sheets and the Company’s estimate of the fair value of the unsecured revolving credit facility, mortgages, unsecured term loans, and senior unsecured notes which includes the fair value of interest rate swaps: (in thousands) March 31, 2026 December 31, 2025 Carrying amount $ 2,653,856 $ 2,522,753 Fair value 2,687,702 2,564,437 Non-recurring Fair Value Measurements The Company’s non-recurring fair value measurements at December 31, 2025 consisted of the fair value of impaired real estate assets that were determined using Level 2 and Level 3 inputs. 9 Right-of-Use Assets and Lease Liabilities Right-of-use assets and lease liabilities associated with operating and finance leases were included in the accompanying Condensed Consolidated Balance Sheets as follows: (in thousands) Financial Statement Presentation March 31, 2026 December 31, 2025 Operating leases: Right-of-use assets Prepaid expenses and other assets 9,407 9,578 Lease liabilities Accounts payable and other liabilities 9,422 9,580 Financing leases: Right-of-use assets Prepaid expenses and other assets 2,210 2,221 Lease liabilities Accounts payable and other liabilities 2,743 2,729 Refer to Note 16 for obligations under operating and finance leases. Recently Issued Accounting Standards In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”). ASU 2024-03 requires a public entity to disclose additional information about specific expense categories in the notes to financial statements on an annual and interim basis. The amendments are effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The Company may elect to apply the amendments either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to any or all prior periods presented in the financial statements. While this update will result in enhanced disclosures, the Company does not expect it will have a material impact on the Company’s financial statements. In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements (“ASU 2025-09”). ASU 2025-09 seeks to better align hedge accounting with an entity’s risk management strategies by improving the ability to achieve and maintain hedge accounting for highly effective economic hedges of forecasted transactions. ASU 2025-09 is effective for annual periods beginning after December 15, 2026, including interim periods within those fiscal years. The Company is currently evaluating the potential impact of the guidance, including any additional disclosures that may be required. In December 2025, the FASB issued ASU 2025‑11, Interim Reporting (Topic 270): Narrow‑Scope Improvements (“ASU 2025‑11”). ASU 2025‑11 clarifies the applicability of the interim reporting guidance in ASC 270, specifies the form and content of interim financial statements and related disclosures, adds a disclosure principle requiring entities to disclose events since the end of the most recent annual reporting period that have a material impact, and improves the organization and navigability of required interim disclosures. The amendments are not intended to change the fundamental nature of interim reporting or significantly expand or reduce existing interim disclosure requirements. ASU 2025‑11 is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the potential impact of the guidance, including additional disclosures that may be required. 3. Asset Acquisitions The Company closed on the following acquisitions during the three months ended March 31, 2026: (in thousands, except number of properties) Property Type Number of Properties Real Estate Acquisition Price Date January 30, 2026 Industrial 0 $ 20,100 (a) February 18, 2026 Retail 1 $ 2,018 (b) February 24, 2026 Industrial 1 17,538 (b) March 19, 2026 Industrial 1 61,195 3 $ 100,851 (c) (a) Acquisition of an option to purchase land to be developed in connection with an industrial property. (b) Acquisition of land to be developed in connection with a build-to-suit development. (c) Acquisition price excludes capitalized acquisition and development costs of $ 3.3 million. 10 The Company closed on the following acquisitions during the three months ended March 31, 2025: (in thousands, except number of properties) Property Type Number of Properties Real Estate Acquisition Price Date January 28, 2025 Retail 1 $ 9,871 February 13, 2025 Retail 1 495 (d) March 11, 2025 Industrial 1 41,088 March 28, 2025 Retail 4 8,045 7 $ 59,499 (e) (d) Acquisition of land to be developed in connection with a build-to-suit development. (e) Acquisition price excludes capitalized acquisition costs of $ 2.0 million. The Company allocated the purchase price of these properties to the fair value of the assets acquired and liabilities assumed. The following table summarizes the purchase price allocation for completed real estate acquisitions: (in thousands) For the Three Months Ended March 31, 2026 2025 Land $ 43,311 $ 3,720 Land improvements 2,144 1,569 Buildings and improvements 15,666 49,858 Property under development 40,730 824 Acquired in-place leases (f) 2,259 6,053 Acquired below-market leases (g) — ( 145 ) Right-of-use asset — 2,262 Lease liability — ( 2,681 ) $ 104,110 $ 61,460 (f) The weighted average amortization period for acquired in-place leases is 12 years and 13 years for acquisitions completed during the three months ended March 31, 2026 and 2025, respectively. (g) There were no acquisitions of below-market leases during the three months ended March 31, 2026. The weighted average amortization period for acquired below-market leases is 14 years for acquisitions completed during the three months ended March 31, 2025. The above acquisitions were funded using a combination of available cash on hand and unsecured revolving credit facility borrowings. All real estate acquisitions closed during the three months ended March 31, 2026 and 2025 qualified as asset acquisitions and as such, acquisition costs were capitalized. Subsequent to March 31, 2026, the Company closed on the following acquisitions (see Note 17): (in thousands, except number of properties) Property Type Number of Properties Real Estate Acquisition Price Date April 29, 2026 Industrial 1 $ 6,990 4. Sale of Real Estate The Company closed on the following sales of real estate, none of which qualified as discontinued operations: (in thousands, except number of properties) For the Three Months Ended March 31, 2026 2025 Number of properties disposed 1 3 Aggregate sale price $ 12,094 $ 7,808 Aggregate carrying value ( 4,095 ) ( 7,385 ) Additional sales expenses ( 877 ) ( 18 ) Gain on sale of real estate $ 7,122 $ 405 11 5. Investment in Rental Property and Lease Arrangements The Company generally leases its investment rental property to established tenants in the industrial and retail property types. At March 31, 2026, the Company had 773 real estate properties, 761 of which were leased under leases that have been classified as operating leases, nine that have been classified as direct financing leases, one that has been classified as a sales-type lease, and two that were vacant. Of the nine leases classified as direct financing leases, three include land portions which are accounted for as operating leases (see Revenue Recognition within Note 2). Most leases have initial terms of 10 to 20 years. The Company’s leases generally provide for limited increases in rent as a result of fixed increases, increases in the Consumer Price Index (“CPI”), or increases in the tenant’s sales volume. Generally, tenants are also required to pay all property taxes and assessments, substantially maintain the interior and exterior of the building, and maintain property and liability insurance coverage. The leases also typically provide for one or more multiple-year renewal options, at the election of the tenant, and are subject to generally the same terms and conditions as the initial lease. Investment in Rental Property – Operating Leases Depreciation expense on investment in rental property was as follows: For the Three Months Ended March 31, (in thousands) 2026 2025 Depreciation $ 33,363 $ 31,459 Estimated lease payments to be received under non-cancelable operating leases with tenants at March 31, 2026 are as follows: (in thousands) Remainder of 2026 $ 434,726 2027 431,444 2028 432,024 2029 422,919 2030 397,843 Thereafter 3,070,437 $ 5,189,393 Since lease renewal periods are exercisable at the option of the tenant, the above amounts only include future lease payments due during the initial lease terms. Such amounts exclude any potential variable rent increases that are based on changes in the CPI or future variable rents which may be received under the leases based on a percentage of the tenant’s gross sales. Additionally, certain of our leases provide tenants with the option to terminate their leases in exchange for termination penalties, or that are contingent upon the occurrence of a future event. Future lease payments within the table above have not been adjusted for these termination rights. Investment in Rental Property – Direct Financing Leases The Company’s net investment in direct financing leases was comprised of the following: (in thousands) March 31, 2026 December 31, 2025 Undiscounted estimated lease payments to be received $ 27,861 $ 28,699 Estimated unguaranteed residual values 14,547 14,547 Unearned revenue ( 17,019 ) ( 17,663 ) Reserve for credit losses ( 86 ) ( 86 ) Net investment in direct financing leases $ 25,303 $ 25,497 12 Undiscounted estimated lease payments to be received under non-cancelable direct financing leases with tenants at March 31, 2026 are as follows: (in thousands) Remainder of 2026 $ 2,520 2027 3,426 2028 3,496 2029 3,561 2030 3,682 Thereafter 11,176 $ 27,861 The above rental receipts do not include future lease payments for renewal periods, potential variable CPI rent increases, or variable percentage rent payments that may become due in future periods. Investment in Rental Property – Sales-Type Leases The Company’s net investment in a sales-type lease was $ 14.4 million at March 31, 2026 and December 31, 2025, and was comprised of one lease. The lease has $ 16.4 million of undiscounted estimated lease payments to be received throughout the remaining lease term, which expires in 2027. Lease Revenues, Net The following table summarizes amounts reported as Lease revenues, net in the Condensed Consolidated Statements of Income and Comprehensive Income: (in thousands) For the Three Months Ended March 31, 2026 2025 Contractual rental amounts billed for operating leases $ 107,519 $ 99,314 Adjustment to recognize contractual operating lease billings on a straight-line basis 5,848 6,064 Net write-offs of accrued rental income — ( 2,228 ) Variable rental amounts earned 757 680 Earned income from direct financing leases 667 682 Interest income from sales-type leases 474 14 Operating expenses billed to tenants 5,700 4,944 Other income from real estate transactions 32 77 Adjustment to revenue recognized for uncollectible rental amounts billed, net 404 ( 857 ) Total lease revenues, net $ 121,401 $ 108,690 13 6. Intangible Assets and Liabilities, and Leasing Fees The following is a summary of intangible assets and liabilities, and leasing fees, and related accumulated amortization: (in thousands) March 31, 2026 December 31, 2025 Lease intangibles: Acquired above-market leases $ 40,662 $ 41,082 Less accumulated amortization ( 20,775 ) ( 20,574 ) Acquired above-market leases, net 19,887 20,508 Acquired in-place leases 422,010 423,920 Less accumulated amortization ( 179,922 ) ( 176,418 ) Acquired in-place leases, net 242,088 247,502 Total intangible lease assets, net $ 261,975 $ 268,010 Acquired below-market leases $ 91,168 $ 91,670 Less accumulated amortization ( 51,308 ) ( 50,143 ) Intangible lease liabilities, net $ 39,860 $ 41,527 Leasing fees $ 24,171 $ 22,643 Less accumulated amortization ( 8,125 ) ( 7,760 ) Leasing fees, net $ 16,046 $ 14,883 Amortization of intangible lease assets and liabilities, and leasing fees was as follows: (in thousands) Financial Statement Presentation For the Three Months Ended March 31, Intangible 2026 2025 Acquired in-place leases and leasing fees Depreciation and amortization $ 8,069 $ 7,944 Above-market and below-market leases Lease revenues, net 1,016 1,065 There was no accelerated amortization resulting from early lease terminations during the three months ended March 31, 2026. For the three months ended March 31, 2025, amortization of all intangible assets and liabilities includes $ 0.2 million of accelerated amortization resulting from early lease terminations. Estimated future amortization of intangible assets and liabilities, and leasing fees at March 31, 2026 is as follows: (in thousands) Remainder of 2026 $ 20,850 2027 26,312 2028 24,091 2029 22,493 2030 20,104 Thereafter 124,311 $ 238,161 14 7. Unsecured Credit Agreements and Unsecured Notes The following table summarizes the Company’s unsecured credit agreements and unsecured notes: Outstanding Balance (in thousands, except interest rates) March 31, 2026 December 31, 2025 Interest Rate Maturity Date Unsecured revolving credit facility $ 397,640 $ 266,036 applicable reference rate + 0.85 % (a) Mar. 2029 (d) Unsecured term loans: 2027 Unsecured Term Loan 200,000 200,000 daily simple SOFR + 0.95 % (c) Aug. 2027 2028 Unsecured Term Loan 500,000 500,000 one-month SOFR + 0.95 % (b) Mar. 2028 (e) 2029 Unsecured Term Loan 300,000 300,000 daily simple SOFR + 0.95 % (c) Feb. 2029 (f) Total unsecured term loans 1,000,000 1,000,000 Unamortized debt issuance costs, net ( 5,180 ) ( 5,781 ) Total unsecured term loans, net 994,820 994,219 Senior unsecured notes: 2027 Senior Unsecured Notes - Series A 150,000 150,000 4.84 % Apr. 2027 2028 Senior Unsecured Notes - Series B 225,000 225,000 5.09 % Jul. 2028 2030 Senior Unsecured Notes - Series C 100,000 100,000 5.19 % Jul. 2030 2031 Senior Unsecured Public Notes 375,000 375,000 2.60 % Sep. 2031 2032 Senior Unsecured Public Notes 350,000 350,000 5.00 % Nov. 2032 Total senior unsecured notes 1,200,000 1,200,000 Unamortized debt issuance costs and original issuance discounts, net ( 8,857 ) ( 9,262 ) Total senior unsecured notes, net 1,191,143 1,190,738 Total unsecured debt, net $ 2,583,603 $ 2,450,993 (a) At March 31, 2026 and December 31, 2025, a balance of $ 326.0 million and $ 193.0 million, respectively, was subject to daily simple SOFR. The remaining balance of $ 100.0 million Canadian Dollars (“CAD”) borrowings remeasured to $ 71.6 million United States Dollars (“USD”) and $ 73.0 million USD, at March 31, 2026 and December 31, 2025, respectively, and was subject to daily simple CORRA of 2.27 % and 2.30 % at March 31, 2026 and December 31, 2025, respectively. (b) At March 31, 2026 and December 31, 2025, one-month SOFR was 3.66 % and 3.69 %, respectively. (c) At March 31, 2026 and December 31, 2025, overnight SOFR was 3.68 % and 3.87 %, respectively. (d) The unsecured revolving credit facility contains two six-month extension options subject to certain conditions, including the payment of an extension fee equal to 0.0625 % of the revolving commitments. (e) The 2028 Unsecured Term Loan contains two twelve-month extension options subject to certain conditions, including the payment of an extension fee equal to 0.125 % of the aggregate principal amount of the loans outstanding under the 2028 term loan facility. (f) The 2029 Unsecured Term Loan contains two twelve-month extension options subject to certain conditions, including the payment of an extension fee equal to 0.10 % of the aggregate principal amount of the loans outstanding under the 2029 term loan facility. At March 31, 2026, the weighted average interest rate on all outstanding borrowings was 4.48 % exclusive of interest rate swap agreements, and 4.10 % inclusive of interest rate swap agreements. The Company is subject to various financial and operational covenants and financial reporting requirements pursuant to its unsecured credit agreements. These covenants require the Company to maintain certain financial ratios. As of March 31, 2026, and for all periods presented, the Company believes it was in compliance with all of its loan covenants. Failure to comply with the covenants would result in a default which, if the Company were unable to cure or obtain a waiver from the lenders, could accelerate the repayment of the obligations. Further, in the event of default, the Company may be restricted from paying dividends to its stockholders in excess of dividends required to maintain its REIT qualification. Accordingly, an event of default could have a material effect on the Company. The Company did not incur debt issuance costs during the three months ended March 31, 2026. For the three months ended March 31, 2025, the Company incurred $ 12.3 million in debt issuance costs associated with the amended and restated unsecured revolving credit facility and 2028 Unsecured Term Loan, which have been deferred and are being amortized over the term of the associated debt. 15 Debt issuance costs and original issuance discounts are amortized as a component of Interest expense in the accompanying Condensed Consolidated Statements of Income and Comprehensive Income. The following table summarizes debt issuance cost and original issuance discount amortization: For the Three Months Ended March 31, (in thousands) 2026 2025 Debt issuance costs and original issuance discount amortization $ 1,627 $ 1,237 8. Mortgages The Company’s mortgages consist of the following: (in thousands, except interest rates) Origination Date Maturity Date Interest Rate March 31, 2026 December 31, 2025 Lender Wilmington Trust National Association Apr. 2019 Feb. 2028 4.92 % $ 41,013 $ 41,393 (a) (b) (c) (d) PNC Bank Oct. 2016 Nov. 2026 3.62 % 15,203 15,324 (b) (c) Total mortgages 56,216 56,717 Debt issuance costs, net ( 19 ) ( 28 ) Mortgages, net $ 56,197 $ 56,689 (a) Non-recourse debt includes the indemnification/guaranty of the Company pertaining to fraud, environmental claims, insolvency, and other matters. (b) Debt secured by related rental property and lease rents. (c) Debt secured by guaranty of the OP. (d) Mortgage was assumed as part of the acquisition of the related property. The debt was recorded at fair value at the time of assumption. At March 31, 2026, investment in rental property with a net book value of $ 80.5 million was pledged as collateral against the Company’s mortgages. Estimated future principal payments to be made under the above mortgages and the Company’s unsecured credit agreements (see Note 7) at March 31, 2026 are as follows: (in thousands) Remainder of 2026 $ 16,342 2027 351,597 2028 763,277 2029 697,640 2030 100,000 Thereafter 725,000 $ 2,653,856 Certain of the Company’s mortgages provide for prepayment fees and can be terminated under certain events of default as defined under the related agreements. These prepayment fees are not reflected as part of the table above. 16 9. Interest Rate Swaps The following is a summary of the Company’s outstanding interest rate swap agreements: (in thousands, except interest rates) March 31, 2026 December 31, 2025 Counterparty Maturity Date Fixed Rate Variable Rate Index Notional Amount Fair Value Notional Amount Fair Value Bank of Montreal January 2026 1.92 % daily compounded SOFR $ — $ — $ 25,000 $ 1 Bank of Montreal January 2026 2.05 % daily compounded SOFR — — 40,000 2 Capital One, National Association January 2026 2.08 % daily compounded SOFR — — 35,000 2 Truist Financial Corporation January 2026 1.93 % daily compounded SOFR — — 25,000 1 Capital One, National Association April 2026 2.68 % daily compounded SOFR 15,000 3 15,000 43 Capital One, National Association July 2026 1.32 % daily compounded SOFR 35,000 216 35,000 410 Bank of Montreal December 2026 2.33 % daily compounded SOFR 10,000 107 10,000 116 Bank of Montreal December 2026 1.99 % daily compounded SOFR 25,000 330 25,000 373 Toronto-Dominion Bank March 2027 2.46 % daily compounded CORRA 14,328 (a) 46 14,607 (a) 32 Wells Fargo Bank, N.A. April 2027 2.72 % daily compounded SOFR 25,000 259 25,000 224 Bank of Montreal December 2027 2.37 % daily compounded SOFR 25,000 568 25,000 494 Capital One, National Association December 2027 2.37 % daily compounded SOFR 25,000 566 25,000 493 Wells Fargo Bank, N.A. January 2028 2.37 % daily compounded SOFR 75,000 1,707 75,000 1,485 Bank of Montreal May 2029 2.09 % daily compounded SOFR 25,000 1,161 25,000 1,084 Regions Bank May 2029 2.11 % daily compounded SOFR 25,000 1,144 25,000 1,067 Regions Bank June 2029 2.03 % daily compounded SOFR 25,000 1,208 25,000 1,136 U.S. Bank National Association June 2029 2.03 % daily compounded SOFR 25,000 1,209 25,000 1,135 Regions Bank August 2029 2.58 % one-month SOFR 100,000 2,947 100,000 2,501 Toronto-Dominion Bank August 2029 2.58 % one-month SOFR 45,000 1,345 45,000 1,145 U.S. Bank National Association August 2029 2.65 % one-month SOFR 15,000 415 15,000 345 U.S. Bank National Association August 2029 2.58 % one-month SOFR 100,000 2,956 100,000 2,508 U.S. Bank National Association August 2029 1.35 % daily compounded SOFR 25,000 1,825 25,000 1,793 Toronto-Dominion Bank December 2030 3.66 % daily simple SOFR 70,000 ( 351 ) 70,000 ( 835 ) Regions Bank December 2030 3.66 % daily simple SOFR 55,000 ( 286 ) 55,000 ( 666 ) Regions Bank March 2032 2.69 % daily compounded CORRA 14,328 (a) 422 14,607 (a) 394 U.S. Bank National Association March 2032 2.70 % daily compounded CORRA 14,328 (a) 420 14,607 (a) 391 Bank of Montreal March 2034 2.81 % daily compounded CORRA 28,656 (b) 1,121 29,214 (b) 1,073 Total Swaps $ 816,640 $ 19,338 $ 943,035 $ 16,747 (a) The contractual notional amount is $ 20.0 million CAD. (b) The contractual notional amount is $ 40.0 million CAD. At March 31, 2026, the weighted average interest rate on all outstanding borrowings was 4.10 %, inclusive of a weighted average fixed rate on effective interest rate swaps of 2.56 %. The total amounts recognized, and the location in the accompanying Condensed Consolidated Statements of Income and Comprehensive Income, from converting from variable rates to fixed rates under these agreements were as follows: Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income Reclassification from Accumulated Other Comprehensive Income Total Interest Expense Presented in the Condensed Consolidated Statements of Income and Comprehensive Income (Loss) (in thousands) Location Amount of Gain For the Three Months Ended March 31, 2026 $ 2,591 Interest expense $ 2,160 $ 25,260 2025 ( 19,892 ) Interest expense 4,733 20,074 Amounts related to the interest rate swaps expected to be reclassified out of Accumulated other comprehensive income to Interest expense during the next twelve months are estimated to be a gain of $ 7.6 million. 17 10. Non-Controlling Interests The Company has seven entities with non-controlling interests that are consolidated: the “OP” and interests in six consolidated VIEs not wholly-owned by the Company (See Principles of Consolidation within Note 2). The following table summarizes OP Units exchanged for shares of common stock: For the Three Months Ended March 31, (in thousands) 2026 2025 OP Units exchanged for shares of common stock — 244 Value of units exchanged $ — $ 3,882 11. Credit Risk Concentrations The Company maintained bank balances that, at times, exceeded the federally insured limit during the three months ended March 31, 2026. The Company has not experienced losses relating to these deposits and management does not believe that the Company is exposed to any significant credit risk with respect to these amounts based on the financial position and capitalization of the applicable banks. For the three months ended March 31, 2026 and 2025, the Company had no individual tenants or common franchises that accounted for more than 10% of Lease revenues, net, excluding lease termination fees. 18 12. Equity At-the-Market Program (“ATM Program”) The Company has entered into an at-the-market common equity offering program (the "ATM Program") through which it may, from time to time, publicly offer and sell shares of common stock. The Company’s ATM Program also provides for forward sale agreements, enabling the Company to set the price of shares upon pricing the offering, while delaying the issuance of shares and the receipt of the net proceeds. The following table presents information about the Company’s ATM Programs that were in place during 2025 and 2026: (in thousands) Program Size Total Shares Sold Total Shares Settled Total Shares Unsettled as of March 31, 2026 Total Net Proceeds Anticipated or Received from Shares Sold Program 2024 $ 400,000 6,527 (a) 2,188 4,340 (b) $ 118,969 (a) After considering the shares of common stock sold subject to forward sale agreements, the Company has $ 281.0 million of capacity remaining under the ATM Program at March 31, 2026. (b) The Company has the option to settle all outstanding shares of common stock from forward sale agreements at any time before December 2026 for net proceeds of approximately $ 80.6 million. The following table presents activity under the Company’s ATM Programs: For the Three Months Ended March 31, (in thousands, except per share amounts) 2026 2025 Shares of common stock sold 3,718 — Weighted average gross sales price $ 19.13 $ — Shares of common stock settled — — Net proceeds received $ — $ — Stock Repurchase Program The Company has a stock repurchase program (the “Repurchase Program”), which authorizes the Company to repurchase up to $ 150.0 million of the Company’s common stock. On February 13, 2026, the Company’s Board of Directors re-authorized the Repurchase Program for a twelve-month period ending on March 14, 2027. The Repurchase Program may be extended, suspended, or discontinued at any time. Under the Repurchase Program, repurchases of the Company’s stock can be made in the open market or through private transactions from time to time over the twelve-month period, depending on prevailing market conditions and compliance with applicable legal and regulatory requirements. The timing, manner, price, and amount of any repurchases of common stock under the Repurchase Program will be determined at the Company’s discretion, using available cash resources. During the three months ended March 31, 2026 and 2025, no shares of the Company’s common stock were repurchased under the Repurchase Program. 19 13. Stock-Based Compensation Restricted Stock Awards During the three months ended March 31, 2026 and 2025, the Company awarded 258,679 and 265,872 shares of restricted stock awards (“RSAs”), respectively, to officers, employees, and non-employee directors under the Company’s equity incentive plan. The holder of RSAs is generally entitled at all times on and after the date of issuance of the restricted common shares to exercise the rights of a stockholder of the Company, including the right to vote the shares and the right to receive dividends on the shares. The RSAs vest over a one -, three -, four -, or five-year period from the date of the grant and are subject to the holder’s continued service through the applicable vesting dates and in accordance with the terms of the individual award agreements. The weighted average value of awards granted per share during the three months ended March 31, 2026 and 2025, were $ 19.32 and $ 16.85 , respectively, which were based on the market price per share of the Company’s common stock on the grant dates. The following table presents information about the Company’s RSAs: For the Three Months Ended March 31, (in thousands) 2026 2025 Compensation cost $ 1,497 $ 1,342 Dividends declared on unvested RSAs 325 313 Fair value of shares vested during the period 4,191 2,887 As of March 31, 2026, there was $ 14.1 million of unrecognized compensation costs related to the unvested restricted shares, which is expected to be recognized over a weighted average period of 2.9 years. The following table presents information about the Company’s restricted stock activity: For the Three Months Ended March 31, 2026 2025 (in thousands, except per share amounts) Number of Shares Weighted Average Grant Date Fair Value per Share Number of Shares Weighted Average Grant Date Fair Value per Share Unvested at beginning of period 1,070 $ 15.69 989 $ 15.51 Granted 259 19.32 266 16.85 Vested ( 216 ) 16.82 ( 172 ) 16.72 Forfeited — 19.32 ( 3 ) 16.13 Unvested at end of period 1,113 16.32 1,080 15.64 Performance-based Restricted Stock Units During the three months ended March 31, 2026 and 2025, the Company issued target grants of 260,729 and 246,967 of performance-based restricted stock units (“PRSUs”), respectively, under the Company’s equity incentive plan to the executive officers of the Company. The awards are non-vested restricted stock units where the vesting percentages and the ultimate number of units vesting will be measured 50 % based on the relative total shareholder return (“rTSR”) of the Company’s common stock as compared to the rTSR of peer companies, as identified in the grant agreements, over a three-year period, and 50 % based on the rTSR of the Company’s common stock as compared to the rTSR of the MSCI US REIT Index over a three-year measurement period. Vesting percentages range from 0 % to 200 % with a target of 100 %. rTSR means the percentage appreciation in the fair market value of one share over the three-year measurement period beginning on the date of grant, assuming the reinvestment of dividends on the ex-dividend date. The target number of units is based on achieving a rTSR equal to the 55 th percentile of the peer companies and MSCI US REIT Index. For PRSUs issued during the three months ended March 31, 2026 and 2025 that achieve a percentile rank of at least the 55 th percentile, and the absolute rTSR of the Company is negative for the performance period, the awards will be reduced by 25 %, not to result in a reduction less than target. Recipients of PRSU awards issued during the three months ended March 31, 2026 are eligible to receive additional PRSUs equal to additional 25 % of their respective target awards if the absolute rTSR reaches 24 %, and an additional 50 % vesting if the rTSR reaches 36 %, with linear interpolation if the rTSR is between 24 % and 36 % . Dividends accrue during the measurement period and will be paid on the PRSUs ultimately earned at the end of the measurement period in either cash or common stock, at the discretion of the Compensation Committee of the Board of Directors. The grant date fair value of the PRSUs was measured using a Monte Carlo simulation model based on assumptions including share price volatility. 20 The following table presents compensation cost recognized on the Company’s performance-based restricted stock units: For the Three Months Ended March 31, (in thousands) 2026 2025 Compensation cost $ 1,069 $ 805 As of March 31, 2026, there was $ 10.6 million of unrecognized compensation costs related to the unvested PRSUs, which is expected to be recognized over a weighted average period of 2.4 years. The following table presents information about the Company’s performance-based restricted stock unit activity: For the Three Months Ended March 31, 2026 2025 (in thousands, except per share amounts) Number of Shares Weighted Average Grant Date Fair Value per Share Number of Shares Weighted Average Grant Date Fair Value per Share Unvested at beginning of period 606 $ 20.13 433 $ 20.90 Granted 261 25.09 247 21.12 Vested ( 163 ) 23.78 ( 74 ) 27.93 Forfeited — — — — Unvested at end of period 704 20.13 606 20.13 14. Earnings per Share The following table summarizes the components used in the calculation of basic and diluted earnings per share (“EPS”): (in thousands, except per share amounts) For the Three Months Ended March 31, 2026 2025 Basic earnings: Net earnings attributable to Broadstone Net Lease, Inc. common shareholders $ 46,365 $ 16,743 Less: earnings allocated to unvested restricted shares ( 325 ) ( 310 ) Net earnings used to compute basic earnings per common share $ 46,040 $ 16,433 Diluted earnings: Net earnings used to compute basic earnings per common share $ 46,040 $ 16,433 Add: net earnings attributable to OP Unit holders 1,926 750 Net earnings used to compute diluted earnings per common share $ 47,966 $ 17,183 Weighted average number of common shares outstanding 191,519 188,882 Less: weighted average unvested restricted shares (a) ( 1,084 ) ( 1,017 ) Weighted average number of common shares outstanding used in basic earnings per common share 190,435 187,865 Add: effects of restricted stock units (b) 1,023 573 Add: effects of convertible OP Units (c) 8,296 8,460 Weighted average number of common shares outstanding used in diluted earnings per common share 199,754 196,898 Basic and diluted earnings per share $ 0.24 $ 0.09 (a) Represents the weighted average effects of 1,112,435 and 1,068,754 unvested restricted shares of common stock as of March 31, 2026 and 2025, respectively, which will be excluded from the computation of earnings per share until they vest. (b) Represents the weighted average effects of shares of common stock to be issued as though the end of the period were the end of the performance period (see Note 13). (c) Represents the weighted average effects of 8,295,768 and 8,401,937 OP Units outstanding at March 31, 2026 and 2025, respectively. 21 15. Supplemental Cash Flow Disclosures The following table summarizes the Company’s supplemental cash flow information: For the Three Months Ended March 31, (in thousands) 2026 2025 Supplemental disclosures: Cash paid for interest $ 18,290 $ 15,557 Cash paid for income taxes 311 722 Non-cash activities: Issuance and conversion of OP Units to common stock (a) — 3,882 Dividends declared not yet paid 59,884 58,220 Reclassifications from Property under development to Buildings and Land improvements upon development properties 49,725 — Retirement of common stock withheld for net settlement under the equity incentive plan 5,183 1,446 (a) See Note 10. 22 16. Commitments and Contingencies Litigation From time to time, the Company is a party to various litigation matters incidental to the conduct of the Company’s business. While the resolution of such matters cannot be predicted with certainty, based on currently available information, the Company does not believe that the final outcome of any of these matters will have a material effect on its consolidated financial position, results of operations, or liquidity. Property and Acquisition Related In connection with ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. The Company is not aware of any non-compliance, liability, claim, or other environmental condition that would have a material effect on its consolidated financial position, results of operations, or liquidity. As of March 31, 2026, the Company has commitments to fund 11 build-to-suit transactions with remaining obligations of $ 175.8 million expected to fund in multiple draws through March 2027, using a combination of available cash on hand and Revolving Credit Facility borrowings. Rent is contractually scheduled to commence when the properties reach substantial completion and are made available for use by the tenant, which is expected to occur at various dates between July 2026 and March 2027. Additionally, the Company has a $ 7.0 million commitment to complete infrastructure improvements at a property acquired during 2026. The Company is a party to a tax protection agreement with the contributing members of an UPREIT transaction and a second tax protection agreement entered into in connection with the Company’s internalization. The tax protection agreements require the Company to indemnify the beneficiaries in the event of a sale, exchange, transfer, or other disposal of the contributed property, and in the case of the tax protection agreement entered into in connection with the Company’s internalization, the entire Company, in a taxable transaction that would cause such beneficiaries to recognize a gain that is protected under the agreements, subject to certain exceptions. The Company is required to allocate an amount of nonrecourse liabilities to each beneficiary that is at least equal to the minimum liability amount, as contained in the agreements. The minimum liability amount and the associated allocation of nonrecourse liabilities are calculated in accordance with applicable tax regulations, are completed at the OP level, and are not probable. Therefore, there is no impact to the Condensed Consolidated Financial Statements. Based on values as of March 31, 2026, taxable sales of the applicable properties would trigger liability under the agreements of approximately $ 16.4 million. Based on information available, the Company does not believe that the events resulting in damages as detailed above have occurred or are likely to occur in the foreseeable future. In the normal course of business, the Company enters into various types of commitments to purchase real estate properties. These commitments are generally subject to the Company’s customary due diligence process and, accordingly, a number of specific conditions must be met before the Company is obligated to purchase the properties. Obligations Under Operating and Finance Leases The Company is a lessee under non-cancelable operating and finance leases associated with its corporate headquarters and other office spaces as well as ground leases. The Company’s obligations under leases primarily consist of a lease for the Company’s corporate office space, which expires in March 2034 and was determined to be an operating lease. The lease contains two five-year extension options, exercisable at the Company’s discretion, that are not reasonably certain to be exercised, and are therefore excluded from our calculation of the lease liability. The remaining lease obligations primarily consist of ground leases that, in accordance with the terms of our leases, are typically required to be reimbursed by our tenants. The Company remains primarily responsible for ground leases in the event a tenant is unable to pay. The weighted average discount rate on our operating and finance leases is 8.4 %. The weighted average years remaining on our operating and finance lease liabilities is 27.3 years. 23 The following table summarizes the total lease costs associated with operating and finance leases: (in thousands) Financial Statement Presentation For the Three Months Ended March 31, 2026 2025 Operating lease costs: Office leases General and administrative $ 252 $ 252 Ground leases Property and operating expense 67 33 Ground leases - development properties Property under development 21 55 Variable lease costs - ground leases Property and operating expense 15 20 Financing lease costs: Amortization of right-of-use assets Depreciation and amortization 9 9 Interest expense on lease liabilities Interest expense 4 45 Total lease cost $ 368 $ 414 The following table summarizes payments associated with obligations under operating and finance leases reported as net cash provided by operating activities on the accompanying Condensed Consolidated Statements of Cash Flows: For the Three Months Ended March 31, (in thousands) 2026 2025 Operating lease payments $ 335 $ 392 Financing lease payments 54 36 Total $ 389 $ 428 At March 31, 2026, minimum future rental payments due from the Company for operating and finance leases over the next five years and thereafter are as follows: (in thousands) Operating Leases Financing Leases Remainder of 2026 $ 979 $ 163 2027 1,251 218 2028 1,134 218 2029 1,174 238 2030 1,202 245 Thereafter 14,632 18,061 Total undiscounted lease payments 20,372 19,143 Present value adjustment for remaining lease payments ( 10,950 ) ( 16,400 ) Total lease liability $ 9,422 $ 2,743 17. Subsequent Events On April 15, 2026, the Company paid distributions totaling $ 58.5 million. On April 23, 2026, the Board of Directors declared a quarterly distribution of $ 0.2925 per share on the Company’s common stock and OP Units for the second quarter of 2026, which will be payable on or before July 15, 2026 to stockholders and OP Unit holders of record as of June 30, 2026. Subsequent to March 31, 2026, the Company borrowed $ 69.0 million, and paid down $ 53.0 million on the unsecured revolving credit facility, the proceeds of which were used to fund investment activity and for general corporate purposes. Subsequent to March 31, 2026, the Company acquired $ 7.0 million of land to be developed in connection with a $ 30.4 million built-to-suit transaction (see Note 3), and invested $ 31.2 million in thirteen developments. Subsequent to March 31, 2026, the Company sold three properties with an aggregate carrying value of $ 41.1 million for total proceeds of $ 54.8 million. The Company incurred additional expenses related to the sales of approximately $ 1.0 million, resulting in a gain on sale of real estate of approximately $ 12.7 million. 24