What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-02-18 compared with 2025-02-18 · 161 added, 166 removed, 310 unchanged (51% of the section changed)

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We focus on acquiring, owning, and managing primarily industrial and office properties.

Our properties are geographically diversified and our tenants cover a broad cross section of business sectors and range in size from small to very

large private and public companies, many of which are corporations that do not have publicly-rated debt.

We have historically entered into, and intend in the future to enter into, purchase agreements primarily for real estate having net leases with remaining terms of approximately seven to 15 years and built-in rental rate increases.

Our properties are geographically diversified and our tenants cover a broad cross section of business sectors and range in size from small to very large private and public companies, many of which are corporations that do not have publicly-rated debt.

We have historically

entered into, and intend in the future to enter into, purchase agreements primarily for real estate having net leases with remaining terms of approximately seven to 20 years and built-in rental rate increases.

Under a net lease, the tenant is required to pay most or all operating, maintenance, repair and insurance costs and real estate taxes with respect to the leased property.

We actively communicate with buyout funds, real estate brokers and other third parties to locate properties for potential acquisition or to provide mortgage financing in an effort to build our portfolio.

We actively communicate with private equity funds, real estate brokers and other third parties to locate properties for potential acquisition or to provide mortgage financing in an effort to build our portfolio.

We target secondary growth markets that possess favorable economic growth trends, diversified industries, and growing population and employment.

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• the weighted average remaining term of our mortgage debt was 2.5 years and the weighted average interest rate was 4.21%;

• the weighted average remaining term of our senior unsecured notes was 4.4 years, and the weighted average interest rate was 6.22%;

• the average remaining lease term of the portfolio was 7.3 years.

Business Environment

Interest rates and capital markets remained the primary talking points and activity drivers in 2024.

During 2024, the benchmark 10-year U.S.

Treasury yield moved within a range from 3.6% at the low end to 4.8% at the high end, ending the year at 4.5%.

This volatility translated directly to capital markets and investment volume as sellers’ pricing expectations lagged real-time changes in rates, with activity picking up slightly in the fourth quarter of 2024.

According to CBRE, for the year ended December 31, 2024, single-asset industrial investment volume increased by 5.1% from the comparable period in 2023 to $67.9 billion.

Total single-asset commercial real estate volume over the same period increased by 6.4% to $295.5 billion.

The industrial market experienced moderate softening on leasing activity and occupancy rates in 2024 relative to 2023.

According to CBRE, overall industrial vacancy increased to 6.0% with asking rents declining 1.3% year-over-year at the end of 2024 to finish the year at $10.94 per square foot.

However, demand from third-party logistics providers helped increase leasing activity with bulk leases increasing 2.9% year-over-year at the end of 2024.

In addition, construction starts in 2024 slowed to a post-pandemic low of 167.3 million square feet.

Low construction starts are expected to lead to a decline in available first-generation space in 2025 and 2026, which should help stabilize industrial leasing rates in the near term.

The office market saw modest recovery in 2024.

According to CBRE, office net absorption turned positive in the second, third, and fourth quarters of 2024, the first quarters of positive absorption in the past ten quarters.

Nationwide vacancy dropped slightly to 18.9%, with 32 of 57 markets tracked by CBRE showing positive net absorption in the fourth quarter of 2024.

Our expectation is for office absorption to continue improving at a slow pace with prices ticking up year-over-year in 2025.

The business environment stabilized late in 2025 as interest rate volatility eased.

After holding its benchmark rate steady for much of the year, the Federal Reserve implemented a 25 basis point cut in each of September, October, and December, lowering the federal funds target range in aggregate by 75 basis points to 3.50% to 3.75% by year-end.

Subsequent to year end, the Federal Reserve held rates unchanged.

Lower short-term rates improved sentiment in commercial real estate late in the year, though financing conditions remained selective and transaction activity limited.

Liquidity showed modest improvement in the fourth quarter of 2025, but pricing gaps persisted and activity varied by property type.

We expect conditions to remain generally consistent with those experienced in the fourth quarter of 2025, with interest rates, access to debt capital, and transaction activity remaining key factors.

According to Cushman & Wakefield plc (“Cushman”), industrial demand strengthened through the fourth quarter of 2025, marking a second consecutive quarter with net absorption exceeding 50 million square feet.

Fourth quarter of 2025 net absorption totaled 54.5 million square feet, representing a 29% increase year over year and contributing to total 2025 absorption of 176.8 million square feet, a 16.3% increase compared to the prior year.

Nationwide industrial vacancy remained stable at 7.1% for the third consecutive quarter, signaling that demand continued to catch up with a moderating supply pipeline.

National industrial rent growth slowed to 1.5% year over year in the fourth quarter of 2025, the lowest growth rate since early 2020.

While rent growth moderated, approximately 40% of U.S.

markets continued to report positive year over year rent growth.

According to Cushman, new construction deliveries totaled approximately 280 million square feet in 2025, the lowest annual level in eight years, reflecting reduced speculative development activity and a greater share of build to suit projects, which may support vacancy stabilization and rental growth over time.

We collected 100% of all outstanding base rent for calendar year 2025.

This is a testament to the strength of our credit underwriting and asset management teams.

We believe that we have a diverse tenant base, and specifically, we do not have significant exposure to tenants in the retail, hospitality, airlines, and oil and gas industries.

Additionally, our 135 properties are located across 27 states, which we believe mitigates our exposure to regional economic and weather-related issues, including regulations or laws implemented by state and local governments in any one geographic market or area.

In the past, we have received rent modification requests from certain of our tenants, and it is possible we may receive additional requests in the future.

We believe we currently have adequate liquidity in the near term, and we believe that our cash on hand combined with the availability on our Credit Facility is sufficient to cover all near term debt obligations and operating expenses and to continue our industrial growth strategy.

We believe this reflects the strength of our credit underwriting and ongoing asset management.

Our tenant base remains diversified, with limited exposure to tenants in the retail, hospitality, airlines, and oil and gas industries.

As of December 31, 2025, our 151 properties were located across 27 states, which we believe helps limit exposure to regional economic, regulatory, or weather-related risks in any one geographic market or area.

While we received rent modification requests from certain of our tenants in the past, and it is possible we may receive additional requests in the future, occupancy increased to 99.1% at December 31, 2025.

During 2025, we continued to strengthen our balance sheet and liquidity position.

In October 2025, we amended, extended, and upsized our Credit Facility from $525.0 million to $600.0 million, with an option to further increase the facility to $850.0 million.

Further, in December 2025, our Operating Partnership issued $85.0 million in a private placement of the 5.99% 2030 Notes.

We believe we currently have adequate liquidity in the near term, and we believe that our cash on hand combined with the availability on our Credit Facility is sufficient to cover all near-term debt obligations and operating expenses and to continue our industrial property focused growth strategy.

As of December 31, 2025, we had $73.6 million in available liquidity via our revolving credit facility and cash on hand and were in compliance with all of our debt covenants.

We amended our Credit Facility in 2019 to increase our borrowing capacity and extend its maturity date.

In addition, on August 18, 2022, we added a new $150.0 million term loan component.

Based on market observations and conversations we routinely have with lenders, we believe that credit continues to be available for well-capitalized borrowers, as demonstrated by our Operating Partnership’s issuance, on December 18, 2024, of $75.0 million of senior unsecured notes in a private placement.

We continue to monitor our portfolio and intend to maintain a reasonably conservative liquidity position for the foreseeable future.

We completed $207.9 million of industrial acquisitions during the year ended 2025, consisting of ten facilities totaling approximately 1.6 million square feet, with a weighted average capitalization rate of 8.88% and a weighted average lease term of 15.9 years at acquisition.

We also renewed or extended approximately 1.2 million square feet of leases during the year ended 2025, and sold two properties.

Other Business Environment Considerations

The geopolitical landscape remains fractured due to recent world events.

Many domestic manufacturing businesses seek to limit supply chain disruptions by bringing their operations back to the United States.

A level of work-from-home trends appear to be here to stay, but many employees are returning to the office, particularly following the presidential transition.

We expect that industrial demand will be further buoyed by government investment in infrastructure and advanced manufacturing operations.

The Federal Reserve’s interest rate cuts introduced more volatility to the market, and timing of future cuts, if any, remains uncertain.

Broader economic and geopolitical uncertainty due to recent world events and tariffs continues to influence tenant decision making, particularly for industrial users evaluating supply chain resiliency and domestic production needs.

While shifts toward onshoring and advanced manufacturing may support long term industrial demand, these decisions typically require extended planning and capital investment and may take time to translate into leasing activity.

These uncertain times create both risks and opportunities for us and our tenants, and we believe we are well-capitalized and positioned to take advantage.

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We continue to monitor our properties and have not seen any significant impact to our properties in Florida, Georgia, North Carolina, South Carolina, Tennessee, and Texas from the recent hurricane season.

We continue to focus on re-leasing vacant space, renewing upcoming lease expirations, re-financing upcoming loan maturities, and acquiring additional properties with associated long-term leases.

At December 31, 2024, we had four partially vacant buildings and one fully vacant building.

Operationally, we remain focused on maintaining high occupancy through lease renewals and releasing activity, managing upcoming lease expirations, and addressing upcoming debt maturities.

At December 31, 2025, we had four partially vacant buildings and no fully vacant buildings.

We continue to actively market the limited remaining vacant space and monitor tenant credit performance across the portfolio.

We believe our lease expiration schedule for 2026 is manageable as it equates to 11.8% of annual lease revenue at December 31, 2025.

As of the date of this filing, our property acquisitions since the beginning of 2020 have totaled $399.4 million and all but one transaction was industrial in nature, with a weighted average lease term at acquisition of 14.1 years and a current weighted average lease term of 10.6 years.

Our ability to make new investments is highly dependent upon our ability to procure financing.

Our principal sources of financing generally include the issuance of equity securities, long-term unsecured notes in the private placement market, long-term mortgage loans secured by properties, borrowings under our $125.0 million Revolver, with KeyBank, which matures in August 2026, our $160.0 million Term Loan A, which matures in August 2027, our $60.0 million Term Loan B, which matures in February 2026, our $150.0 million Term Loan C, which matures in February 2028, and our Operating Partnership’s $75.0 million senior unsecured notes, which mature in December 2029.

We refer to the Revolver, Term Loan A, Term Loan B, and Term Loan C, collectively, herein as the Credit Facility.

While lenders’ credit standards have tightened, we continue to look to private credit institutions, national and regional banks, insurance companies and non-bank lenders to finance our real estate activities.

Our ability to make new investments depends on our access to capital and financing markets.

While lending standards remain selective, we believe the Company maintains access to multiple sources of capital, including long-term unsecured notes in the private placement market, long-term mortgage loans secured by properties, bank facilities, and borrowings under our Credit Facility.

We continue to evaluate financing options and capital allocation decisions with a focus on maintaining balance sheet flexibility and a conservative liquidity profile.

Recent Developments

Sale Activity

During the year ended December 31, 2024, we continued to execute our capital recycling program, whereby we sold non-core properties and reinvested the proceeds into new real estate assets.

We expect to continue to execute our capital recycling plan and sell non-core properties as reasonable disposition opportunities become available, and we intend to use the sale proceeds to acquire properties in our target, secondary growth markets or pay down outstanding debt.

During the year ended December 31, 2024, we sold seven non-core properties, located in Columbus, Ohio;

Draper, Utah;

Richardson, Texas;

Egg Harbor, New Jersey;

Cumming, Georgia;

Lawrenceville, Georgia;

and Fridley, Minnesota, which are summarized in the table below (dollars in thousands):

During the year ended December 31, 2025, we continued to execute our capital recycling program, whereby we sold properties and redeployed proceeds to either fund property acquisitions in our target secondary growth markets, or repay outstanding debt.

We expect to continue to execute our capital recycling plan and sell properties as reasonable disposition opportunities become available.

During the year ended December 31, 2025, we sold two properties, located in Hickory, North Carolina and Oklahoma City, Oklahoma, which are summarized in the table below (dollars in thousands):

Aggregate Square Footage Sold Aggregate Sales Price Aggregate Sales Costs Aggregate Impairment Charge for the Twelve Months Ended December 31, 2025 Aggregate Gain on Sale of Real Estate, net

116,000 $ 8,025 $ 487 $ 9 $ 367

On April 30, 2025, we completed the transaction to sell our 676,031 square foot property in Tifton, Georgia for $18.5 million, incurring $0.3 million in closing costs, which are included in other expense in the consolidated statements of operations and comprehensive income for the year ended December 31, 2025.

During the year ended December 31, 2024, we recorded a sales-type lease receivable on this property and derecognized the carrying value of this property, recognizing a $3.9 million selling profit from sales-type lease, net, that was included in the gain on sale of real estate, net, in the consolidated statement of operations.

On January 12, 2026, we sold a portion of a land parcel at one of our Ocala, Florida properties for $2.0 million.

We realized a $1.8 million gain on sale, net.

Acquisition Activity

During the year ended December 31, 2024, we acquired seven properties, which are summarized below (dollars in thousands):

During the year ended December 31, 2025, we acquired 19 properties, which are summarized below (dollars in thousands):

Aggregate Square Footage Weighted Average Remaining Lease Term at Time of Acquisition Aggregate Purchase Price Aggregate Capitalized Acquisition Expenses Aggregate Annualized GAAP Fixed Lease Payments

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(1) Weighted average remaining lease term is weighted according to the annualized GAAP rent earned by each lease.

Our leases have remaining terms ranging from 1.0 year to 13.8 years.

During the year ended December 31, 2024, we had three lease terminations, which are aggregated below (dollars in thousands):

Our leases have remaining terms ranging from 0.7 years to 11.7 years.

During the year ended December 31, 2025, we had one lease termination, which is summarized below (dollars in thousands):

Aggregate Square Footage Reduced Aggregate Accelerated Rent Aggregate Accelerated Rent Recognized through December 31, 2025

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Financing Activity

During the year ended December 31, 2024, we repaid three mortgages, collateralized by four properties, which are summarized below (dollars in thousands):

During the year ended December 31, 2025, we repaid two mortgages, collateralized by two properties, which are summarized below (dollars in thousands):

Aggregate Variable Rate Debt Repaid Weighted Average Interest Rate on Variable Rate Debt Repaid

$ 7,181 SOFR + 2.25%

Aggregate Fixed Rate Debt Repaid Weighted Average Interest Rate on Fixed Rate Debt Repaid

$ 3,089 4.59 %

During the year ended December 31, 2024, we issued two mortgages, collateralized by two properties, which are summarized below (dollars in thousands):

Aggregate Fixed Rate Debt Issued Weighted Average Interest Rate on Fixed Rate Debt

$ 15,240 (1) 5.60 %

(1) We issued $15.2 million of fixed rate debt with an interest rate of 5.6% and a maturity date of August 31, 2029.

During the year ended December 31, 2024, we extended the maturity date of one mortgage, collateralized by one property, which is summarized in the table below (dollars in thousands):

Variable Rate Debt Extended Interest Rate on Variable Rate Debt Extended Extension Term

$ 7,386 SOFR + 2.25% 1.3 years

On December 18, 2024, we and the Operating Partnership entered into a Note Purchase Agreement with the institutional investors named therein, in connection with a private placement of $75.0 million of the 2029 Notes.

The proceeds were used to pay down Term Loan B by $20.0 million and the Revolver by $55.0 million.

On May 30, 2025, the Operating Partnership entered into a Term Loan Agreement with KeyBank in connection with the $20.0 million Term Loan D.

Term Loan D was unsecured and had a maturity date of May 30, 2027 and a SOFR spread ranging from 155 to 200 basis points throughout the life of the loan.

The proceeds from Term Loan D were used to pay down the Revolver.

As discussed below, we repaid the full principal balance of Term Loan D in connection with the Credit Facility amendment that occurred on October 10, 2025.

On September 18, 2025, we amended our Credit Facility, increasing our Revolver from $125.0 million to $155.0 million.

We incurred fees of approximately $0.5 million in connection with the increase to our Credit Facility.

The increased credit availability was used, in part, to fund a nine-property portfolio acquisition that closed on September 30, 2025.

On October 10, 2025, we amended, extended, and upsized our Credit Facility, increasing our Revolver from $155.0 million to $200.0 million (and its term to October 2029), decreasing the principal balance of Term Loan A from $160.0 million to $125.0 million (and extending its term to October 2029), increasing the principal balance of Term Loan B from $60.0 million to $143.3 million (and its term to February 2030), decreasing the principal balance of Term Loan C from $150.0 million to $131.7 million, and repaying the full principal balance of our Term Loan D.

The SOFR spread increased by 10 basis points,

ranging from 140 to 210 basis points for the Revolver and 135 to 205 basis points for the Term Loans, depending on our leverage.

We incurred fees of approximately $4.2 million in connection with amending, extending, and upsizing our Credit Facility.

The Credit Facility’s new (and current) bank syndicate is comprised of KeyBank, Fifth Third Bank, The Huntington National Bank, Bank of America, Synovus Bank, PNC Bank, Webster Bank, and S&T Bank.

On December 15, 2025, we and the Operating Partnership entered into a Note Purchase Agreement with the institutional investors named therein, to issue an aggregate $85.0 million of our 2030 Notes.

The proceeds were used to repay the Revolver by $80.3 million.

Equity Activity

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In connection with the 2024 Common Stock Sales Agreement, we filed a prospectus supplement with the SEC dated March 26, 2024, to the prospectus dated March 21, 2024, for the offer and sale of an aggregate offering amount of $250.0 million of common stock.

During the year ended December 31, 2024, we sold 3,699,597 shares of common stock, raising approximately $53.5 million in net proceeds under the 2024 Common Stock Sales Agreement.

On August 12, 2025, we entered into Amendment No.

2 (“Amendment No.

2”) to the 2024 Common Stock Sales Agreement which, among other things, (i) removed Baird as a Common Stock Sales Agent and (ii) added Huntington Securities, Inc.

(“Huntington”) as a Common Stock Sales Agent.

After giving effect to Amendment No.

2, the Common Stock Sales Agents are BofA, Goldman Sachs, KeyBanc, Fifth Third, and Huntington.

In connection with Amendment No.

2, we filed a prospectus supplement with the SEC dated August 12, 2025, which updates and supplements the prospectus supplement dated March 26, 2024, for the offer and sale of an aggregate offering amount of $250.0 million of common stock under the 2024 Registration Statement.

During the year ended December 31, 2025, we sold 4,412,814 shares of common stock, raising approximately $61.0 million in net proceeds under the 2024 Common Stock Sales Agreement, as amended.

Series E Preferred ATM Program

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We sold 15,700 shares of our Series F Preferred Stock, raising $0.4 million in net proceeds, pursuant to the 2024 Registration Statement, during the year ended December 31, 2025.

The primary offering of our Series F Preferred Stock terminated according to its terms on June 1, 2025.

We expensed $0.3 million in prepaid offering costs due to the termination, which was included in general and administrative expenses in the condensed consolidated statements of operations.

Amendments to Operating Partnership Agreement

as amended from time to time, establishing the rights, privileges and preferences of 6.00% Series F Cumulative Redeemable Preferred Units, a newly-designated class of limited partnership interests (the “Series F Preferred Units”).

In connection with the authorization of the Series F Preferred Stock in February of 2020, the Operating Partnership controlled by the Company through its ownership of GCLP Business Trust II, the general partner of the Operating Partnership, adopted the Second Amendment to its Second Amended and Restated Agreement of Limited Partnership (collectively, the “Amendment”), as amended from time to time, establishing the rights, privileges and preferences of 6.00% Series F Cumulative Redeemable Preferred Units, a newly-designated class of limited partnership interests (the “Series F Preferred Units”).

The Amendment provides for the Operating Partnership’s establishment and issuance of an equal number of Series F Preferred Units as are issued shares of Series F Preferred Stock by the Company in connection with the offering upon the Company’s contribution to the Operating Partnership of the net proceeds of the offering.

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The Third Amendment provides for the Operating Partnership’s establishment and issuance of an equal number of Series G Term Preferred Units as are issued shares of Series G Preferred Stock by the Company in connection with the offering of Series G Preferred Stock upon the Company’s contribution to the Operating Partnership of the net proceeds of the offering of Series G Preferred Stock.

Generally, the Series G Preferred Units provided for under the Third Amendment have preferences, distribution rights, and other provisions substantially equivalent to those of the Series G Preferred Stock.

Generally, the Series G Term Preferred Units provided for under the Third Amendment have preferences, distribution rights, and other provisions substantially equivalent to those of the Series G Preferred Stock.

On August 5, 2021, the Operating Partnership adopted the Fourth Amendment to its Second Amended and Restated Agreement of Limited Partnership, including Exhibit SGP thereto, to remove all references to the 7.00% Series D Cumulative Redeemable Preferred Units of the Partnership and update the rights, privileges, and preferences accordingly.

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The calculation of the other fees remained unchanged.

On July 11, 2023, the Company entered into the Eighth Amended Advisory Agreement, as approved unanimously by our Board of Directors, including specifically, our independent directors.

On July 11, 2023, the Company then entered into the Eighth Amended Advisory Agreement, as approved unanimously by our Board of Directors, including specifically, our independent directors.

The Eighth Amended Advisory Agreement contractually eliminated the payment of the incentive fee for the quarters ended September 30, 2023 and December 31, 2023.

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The calculation of the other fees remained unchanged.

For the year ended December 31, 2023, the contractually eliminated incentive fee would have been $4.6 million.

For the years ended December 31, 2023, the contractually eliminated incentive fee would have been $4.6 million.

Non-controlling Interests in Operating Partnership

As of December 31, 2025 and 2024, we owned approximately 99.9% and 99.9%, respectively, of the outstanding OP Units.

During the years ended December 31, 2024 and 2023, we redeemed 271,169 and 80,825 OP units, respectively, for an equivalent amount of common stock.

During the year ended December 31, 2024, we redeemed 271,169 OP units for an equivalent amount of common stock.

The Operating Partnership is required to make distributions on each OP Unit in the same amount as those paid on each share of the Company’s common stock, with the distributions on the OP Units held by the Company being utilized to make distributions to the Company’s common stockholders.

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Our Adviser and Administrator

The Adviser is led by a management team with extensive experience purchasing real estate.

The Adviser is led by a management team with extensive experience purchasing real estate and originating mortgage loans.

Our Adviser and Administrator are controlled by Mr.

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Cooper, our president, also serves as executive vice president of commercial and industrial real estate of our Adviser.

Our Administrator employs our chief financial officer, treasurer, chief compliance officer, and general counsel and secretary (who also serves as our Administrator’s president, general counsel, and secretary, as well as executive vice president of administration of our Adviser) and their respective staffs.

Our Administrator employs our chief financial officer, treasurer, chief compliance officer, and co-general counsels and co-secretaries (one of whom also serves as our Administrator’s president, co-general counsel, and co-secretary, as well as executive vice president of administration of our Adviser) and their respective staffs.

Our Adviser and Administrator also provide investment advisory and administrative services, respectively, to certain of our affiliates, including, but not limited to, Gladstone Capital and Gladstone Investment, both publicly-traded business development companies, Gladstone Land, a publicly-traded REIT that primarily invests in farmland, and Gladstone Alternative, a non-diversified, closed-end management investment company that operates as an “interval fund” that is also our affiliate.

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In addition, we are also responsible for all fees charged by third parties that are directly related to our business, which include real estate brokerage fees, mortgage placement fees, lease-up fees and transaction structuring fees (although we may be able to pass some or all of such fees on to our tenants and borrowers).

Our entrance into the Advisory Agreement and each amendment thereto has been approved unanimously by our Board of Directors.

Our entrance into the Advisory Agreement and each amendment thereto (including the Eighth Amended Advisory Agreement) has been approved unanimously by our Board of Directors.

Our Board of Directors reviews and considers renewing the agreement with our Adviser annually, typically during the month of July.

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On July 14, 2020, the Company entered into the Sixth Amended Advisory Agreement, which replaced the previous calculation of the Base Management Fee.

Under the Sixth Amended Advisory Agreement, the Base Management Fee is payable quarterly in arrears and shall be calculated at an annual rate of 0.425% (0.10625% per quarter) of the prior calendar quarter’s “Gross Tangible Real Estate,” defined in the agreement as the current gross value of the Company’s property portfolio (meaning the aggregate of each property’s original acquisition price plus the cost of any subsequent capital improvements thereon).

Under the Sixth Amended Advisory Agreement, the Base Management Fee is payable quarterly

in arrears and shall be calculated at an annual rate of 0.425% (0.10625% per quarter) of the prior calendar quarter’s “Gross Tangible Real Estate,” defined in the agreement as the current gross value of the Company’s property portfolio (meaning the aggregate of each property’s original acquisition price plus the cost of any subsequent capital improvements thereon).

The calculation of the other fees remained unchanged.

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The calculation of the other fees remained unchanged.

On July 11, 2023, we entered into the Eighth Amended Advisory Agreement, as approved unanimously by our Board of Directors, including specifically, our independent directors.

On July 11, 2023, we then entered into the Eighth Amended Advisory Agreement, as approved unanimously by our Board of Directors, including specifically, our independent directors.

The Eighth Amended Advisory Agreement contractually eliminated the payment of the incentive fee for the quarters ended September 30, 2023 and December 31, 2023.

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Incentive Fee

Pursuant to the Advisory Agreement, the calculation of the incentive fee rewards the Adviser in circumstances where our quarterly Core FFO (defined at the end of this paragraph), before giving effect to any incentive fee, or pre-incentive fee Core FFO, exceeds 2.0% quarterly, or 8.0% annualized, of adjusted total equity (after giving effect to the base management fee but

before giving effect to the incentive fee).

We refer to this as the new hurdle rate.

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However, in no event shall the incentive fee for a particular quarter exceed by 15.0% (the cap) the average quarterly incentive fee paid by us for the previous four quarters (excluding quarters for which no incentive fee was paid).

Core FFO (as defined in the Advisory Agreement) is GAAP net income (loss) available to common stockholders, excluding the incentive fee, depreciation and amortization, any realized and unrealized gains, losses or other non-cash items recorded in net income (loss) available to common stockholders for the period, and one-time events pursuant to changes in GAAP.

Core FFO (as defined in the Advisory Agreement) is GAAP net income (loss) available (attributable) to common stockholders, excluding the incentive fee, depreciation and amortization, any realized and unrealized gains, losses or other non-cash items recorded in net income (loss) available (attributable) to common stockholders for the period, and one-time events pursuant to changes in GAAP.

Capital Gain Fee

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In determining the capital gain fee, we will calculate aggregate realized capital gains and aggregate realized capital losses for the applicable time period.

For this purpose, aggregate realized capital gains and losses, if any, equals the realized gain or loss calculated by the difference between the sales price of the property, less any costs to sell the property and the current gross value of the property (equal to the property’s original acquisition price plus any subsequent non-reimbursed capital improvements) of the disposed property.

At the end of the fiscal year, if this number is positive, then the capital gain fee payable for such time period shall equal 15.0% of such amount.

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Termination Fee

The Advisory Agreement includes a termination fee whereby, in the event of our termination of the agreement without cause (with 120 days’ prior written notice and the vote of at least two-thirds of our independent directors), a termination fee would be payable to the Adviser equal to two times the sum of the average annual base management fee and incentive fee earned by the Adviser during the 24-month period prior to such termination.

The Advisory Agreement includes a termination fee clause whereby, in the event of our termination of the agreement without cause (with 120 days’ prior written notice and the vote of at least two-thirds of our independent directors), a termination fee would be payable to the Adviser equal to two times the sum of the average annual base management fee and incentive fee earned by the Adviser during the 24-month period prior to such termination.

A termination fee is also payable if the Adviser terminates the Advisory Agreement after the Company has defaulted and applicable cure periods have expired.

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Administration Agreement

Under the terms of the Administration Agreement, we pay separately for our allocable portion of our Administrator’s overhead expenses in performing its obligations to us including, but not limited to, rent and our allocable portion of the salaries and benefits expenses of our Administrator’s employees, including, but not limited to, our chief financial officer, treasurer, chief compliance officer, general counsel and secretary (who also serves as our Administrator’s president, general counsel and secretary), and their respective staffs.

compliance officer, chief administrative officer, co-general counsels and co-secretaries (one of whom also serves as our Administrator’s president), and their respective staffs.

Our allocable portion of the Administrator’s expenses are generally derived by multiplying our Administrator’s total expenses by the approximate percentage of time the Administrator’s employees perform services for us in relation to their time spent performing services for all companies serviced by our Administrator under contractual agreements.

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Allocation of Purchase Price

When we acquire real estate with an existing lease, we allocate the purchase price to (i) the acquired tangible assets and liabilities, consisting of land, building, tenant improvements and long-term debt and (ii) the identified intangible assets and liabilities, consisting of the value of above-market and below-market leases, in-place leases, unamortized lease origination

costs, tenant relationships and capital lease obligations.

We allocate the fair values in accordance with Accounting Standard Codification 360, Property Plant and Equipment.

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These differences in timing could have a material impact on our results of operations.

Real Estate Impairment Evaluation

Real Estate Impairment Evaluation - Held and Used

We periodically review the carrying value of each property to determine if circumstances that indicate impairment in the carrying value of the investment exist or that depreciation periods should be modified.

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Results of Operations

The weighted average yield on our total portfolio, which was 8.6% and 8.2% at December 31, 2024 and 2023, respectively, is calculated by taking the annualized straight-line rents, reflected as lease revenue on our consolidated statements of operations, of each acquisition as a percentage of the acquisition cost.

The weighted average yield on our total portfolio, which was 8.5% and 8.6% at December 31, 2025 and 2024, respectively, is calculated by taking the annualized straight-line rents plus operating expense recoveries, reflected as lease revenue on our consolidated statements of operations and other comprehensive income, less property operating expenses, of each acquisition since inception, as a percentage of the acquisition cost plus subsequent capital improvements.

The weighted average yield does not account for the interest expense incurred on the mortgages placed on our properties or other types of existing indebtedness.

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Total operating expenses $ 101,389 $ 102,808 $ (1,419) (1.4) %

Other income (expense)

Other (expense) income

Interest expense $ (41,914) $ (37,395) $ (4,519) 12.1 %

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Distributions attributable to senior common stock (406) (420) 14 (3.3) %

Loss on extinguishment of Series F preferred stock (14) (11) (3) 27.3 %

Gain on repurchase of Series G preferred stock — 3 (3) (100.0) %

Net income (loss) available (attributable) to common stockholders and Non-controlling OP Unitholders $ 11,166 $ (7,801) $ 18,967 (243.1) %

Net income (loss) available (attributable) to common stockholders and Non-controlling OP Unitholders per weighted average share and unit - basic & diluted $ 0.27 $ (0.19) $ 0.46 (242.1) %

Gain (loss) on extinguishment of Series F preferred stock 10 (14) 24 (171.4) %

Net income available to common stockholders and Non-controlling OP Unitholders $ 6,597 $ 11,166 $ (4,569) (40.9) %

Net income available to common stockholders and Non-controlling OP Unitholders per weighted average share and unit - basic & diluted $ 0.14 $ 0.27 $ (0.13) (48.1) %

FFO available to common stockholders and Non-controlling OP Unitholders - basic (1) $ 64,484 $ 59,245 $ 5,239 8.8 %

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FFO per weighted average share of common stock and Non-controlling OP Unit - diluted (1) $ 1.38 $ 1.41 $ (0.03) (2.1) %

$ (0.05) (3.4) %

(1) Refer to the “Funds from Operations” section below within the Management’s Discussion and Analysis section for the definition of FFO and FFO, as adjusted for comparability.

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For the purposes of the following discussion, same store properties are properties we owned as of January 1, 2024, which have not been subsequently vacated or disposed.

Acquired and disposed properties are properties which were either acquired,

disposed of or classified as held for sale at any point subsequent to December 31, 2022.

Acquired and disposed properties are properties which were either acquired, disposed of or classified as held for sale at any point subsequent to December 31, 2023.

Properties with vacancy are properties that were fully vacant or had greater than 5% vacancy, based on square footage, at any point subsequent to January 1, 2024.

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Lease revenues consist of rental income and operating expense recoveries earned from our tenants.

Lease revenues from same store properties increased for the year ended December 31, 2024, due to an increase in recovery revenue from property operating expenses and a settlement received at one of our properties related to deferred maintenance during the current period, partially offset by accelerated rent attributable to a lease termination in the prior period.

Lease revenues decreased for acquired and disposed of properties for the year ended December 31, 2024, as compared to the year ended December 31, 2023, primarily due to the loss of recovery revenue from the 14 properties sold during and subsequent to December 31, 2023.

This was partially offset with our acquisition of seven properties during the year ended December 31, 2024, and the inclusion of a full year of lease revenues recorded in 2024 for five properties acquired during the year ended December 31, 2023.

Lease revenues increased for properties with vacancy for the year ended December 31, 2024 due to an increase in variable lease payments due to an increase in property operating expenses.

Lease revenues from same store properties increased for the year ended December 31, 2025, due to an increase in recovery revenue from property operating expenses and an increase in rental rates from leasing activity subsequent to the year ended December 31, 2024, partially offset by a settlement received at one of our properties related to deferred maintenance in the prior period.

Lease revenues increased for acquired and disposed of properties for the year ended December 31, 2025, as compared to the year ended December 31, 2024, primarily due to an increase in recovery revenue from property expenses and an increase in rental rates on the 19 properties acquired subsequent to December 31, 2024.

Lease revenues decreased for properties with vacancy for the year ended December 31, 2025, mainly due to a loss of rental revenue from increased vacancy, partially offset by an increase in variable lease payments.

Operating Expenses

Depreciation and amortization decreased for the year ended December 31, 2024, as compared to the year ended December 31, 2023, due to reduced depreciation and amortization expense for the seven properties sold during the year ended December 31, 2024.

This was partially offset by a full year of depreciation and amortization for the five properties acquired during the year ended December 31, 2023, as well as increased depreciation and amortization expense from the seven properties acquired during the year ended December 31, 2024.

Depreciation and amortization expense increased for the year ended December 31, 2025, as compared to the year ended December 31, 2024, due to an increase in depreciation and amortization expense on the 19 properties acquired subsequent to December 31, 2024.

This was partially offset by the reduced depreciation and amortization expense from the nine property sales during and subsequent to December 31, 2024.

For the year ended December 31,

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Property operating expenses consist of franchise taxes, management fees, insurance, ground lease payments, property maintenance and repair expenses paid on behalf of tenants at certain of our properties.

Property operating expenses increased for same store properties for the year ended December 31, 2024, as compared to the year ended December 31, 2023, as a result of general cost increases due to the inflationary environment.

The decrease in property operating expenses on acquired and disposed of properties for the year ended December 31, 2024, as compared to the year ended December 31, 2023, is a result of a decrease in property operating expenses in relation to properties held for sale or sold during the year that were fully vacant.

Property operating expenses increased for same store properties for the year ended December 31, 2025, as compared to the year ended December 31, 2024, as a result of general cost increases due to the inflationary environment and increased repair expenses during the year.

The decrease in property operating expenses on acquired and disposed of properties for the year ended December 31, 2025, as compared to the year ended December 31, 2024, is a result of a decrease in property operating expenses in relation to properties held for sale or sold during the year that were fully or partially vacant.

The increase in property operating expenses for properties with vacancy for the year ended December 31, 2025, as compared to the year ended December 31, 2024, is a result of general cost increases due to the inflationary environment.

The base management fee paid to the Adviser decreased for the year ended December 31, 2024, as compared to the year ended December 31, 2023, due to a decrease in gross tangible real estate, the main component of the base management fee calculation under the Sixth Amended Advisory Agreement, due to property sales.

The base management fee paid to the Adviser increased for the year ended December 31, 2025, as compared to the year ended December 31, 2024, due to an increase in gross tangible real estate, the main component of the base management fee calculation under the Eighth Amended Advisory Agreement, from property acquisitions and capital projects.

The calculation of the base management fee is described in detail above within “Advisory and Administration Agreements.”

The incentive fee paid to the Adviser increased for the year ended December 31, 2024, as compared to the year ended December 31, 2023, due to the payment of the incentive fee being contractually eliminated for the quarters ended March 31, 2023 and June 30, 2023, as outlined in the Seventh Amended Advisory Agreement, and for the quarters ended September 30,

2023 and December 31, 2023, as outlined in the Eighth Amended Advisory Agreement.

We recorded an incentive fee, which was partially waived, during the year ended December 31, 2024.

The net incentive fee paid to the Adviser decreased for the year ended December 31, 2025, as compared to the year ended December 31, 2024, due to the Adviser unconditionally waiving a larger portion of the incentive fee during the prior period.

The calculation of the incentive fee is described in detail above within “Advisory and Administration Agreements.”

The administration fee paid to the Administrator increased for the year ended December 31, 2024, as compared to the year ended December 31, 2023.

The increase is a result of our Administrator incurring greater costs that are allocated to the Company.

The administration fee paid to the Administrator increased slightly for the year ended December 31, 2025, as compared to the year ended December 31, 2024.

The slight increase is a result of our Administrator incurring greater costs that are allocated to

The calculation of the administration fee is described in detail above within “ Advisory and Administration Agreements.”

General and administrative expenses decreased for the year ended December 31, 2024, as compared to the year ended December 31, 2023, primarily as a result of a decrease in legal fee expenses.

We recorded an impairment charge during the year ended December 31, 2024 on three properties, as we had determined the carrying value of these properties was in excess of the fair market value and not recoverable.

Accordingly, we impaired these properties to fair market value.

We recorded an impairment charge on five properties during the year ended December 31, 2023.

General and administrative expenses increased for the year ended December 31, 2025, as compared to the year ended December 31, 2024, primarily as a result of an increase in professional fee expenses, partially offset by a decrease in travel and advertising expenses.

We recorded an impairment charge during the year ended December 31, 2025 on one property, as we had determined the carrying value of this property was in excess of the fair market value and not recoverable.

Accordingly, we impaired this property to fair market value.

We recorded an impairment charge on three properties during the year ended December 31, 2024.

Other Income and Expenses

Interest expense increased slightly for the year ended December 31, 2024, as compared to the year ended December 31, 2023.

This increase is primarily the result of increased interest costs on variable rate debt, as global interest rates increased through most of the period in reaction to growing inflation, partially offset by reduced interest expense on mortgage debt that was repaid during and subsequent to December 31, 2023.

The gain on sale of real estate, net, during the year ended December 31, 2024 is a result of the sale of seven properties and a selling profit from sales-type leases related to one lease.

The gain on sale of real estate, net, during the year ended December 31, 2023 was a result of the sale of seven properties.

Interest expense increased for the year ended December 31, 2025, as compared to the year ended December 31, 2024.

This increase is primarily the result of increased interest costs on variable rate debt, as a result of larger amounts drawn on the Credit Facility, writing off deferred financing fees as part of the credit facility amendment, and new interest expense on the 2029 Notes and 2030 Notes.

The gain on sale of real estate, net, during the year ended December 31, 2025 is a result of the sale of two properties.

The gain on sale of real estate, net, during the year ended December 31, 2024 was a result of the sale of seven properties and a selling profit from sales-type leases related to one lease.

The gain on debt extinguishment, net, during the year ended December 31, 2024 was recognized in conjunction with two of our sales.

The gain on debt extinguishment, net, during the year ended December 31, 2023 was recognized in conjunction with one of our sales.

Other income increased minimally during the year ended December 31, 2024, as compared to the year ended December 31, 2023, due to nonrecurring income items that occurred during the year ended December 31, 2024.

Net Income (Loss) Available (Attributable) to Common Stockholders and Non-controlling OP Unitholders

Net income available to common stockholders and Non-controlling OP Unitholders increased for the year ended December 31, 2024, as compared to net loss attributable to common stockholders and Non-controlling OP Unitholders the year ended December 31, 2023, primarily due to lower impairment charges coupled with a higher gain on sale of real estate, net.

This was partially offset by the incentive fee payable to the Adviser in the current period, which was contractually eliminated in the prior period, and a lower gain on debt extinguishment, net, in the current period.

Other income increased during the year ended December 31, 2025, as compared to the year ended December 31, 2024, mainly due to nonrecurring income items that occurred during the year ended December 31, 2025.

Net Income Available to Common Stockholders and Non-controlling OP Unitholders

Net income available to common stockholders and Non-controlling OP Unitholders decreased for the year ended December 31, 2025, as compared to the year ended December 31, 2024, primarily due to the gain on sale, net, from the prior period coupled with an increase in interest expense and depreciation expense in the current period.

This was partially offset by an increase in recovery revenue from property expenses, an increase in rental rates from leasing activity, a decrease in the net incentive fee payable to the Adviser, and higher impairment charges in the prior period.

A discussion of the results of operations for the year ended December 31, 2023 is found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 18, 2025, which is available free of charge on the SEC's website at www.sec.gov and on the investors section of our website at www.GladstoneCommercial.com.

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Our available liquidity as of December 31, 2025, was $73.6 million, including $10.8 million in cash and cash equivalents and an available borrowing capacity of $62.8 million under our Revolver.

Our available borrowing capacity under the Revolver has decreased to $90.6 million as of February 18, 2025.

Our available borrowing capacity under the Revolver decreased to $60.0 million as of February 18, 2026.

Future Capital Needs

We actively seek conservative investments that we expect are likely to produce income to allow us to pay distributions to our stockholders and Non-controlling OP Unitholders.

We intend to use the proceeds received from future equity raised and debt capital borrowed to continue to invest in industrial properties, which is our strategic focus, or to a lessor extent, office real

property, or pay down outstanding borrowings under our Revolver.

Accordingly, to ensure that we are able to effectively execute our business strategy, we routinely review our liquidity requirements and continually evaluate all potential sources of liquidity.

Our short-term liquidity needs include proceeds necessary to fund our distributions to stockholders, pay the debt service costs on our existing long-term mortgages, bank debt, and long-term private debt, refinancing maturing debt and fund our current operating costs.

Our short-term liquidity needs include proceeds necessary to fund our distributions to stockholders, pay the debt service costs on our existing long-term mortgages, bank debt, and long-term private debt, refinance maturing debt and fund our current operating costs.

Our long-term liquidity needs include proceeds necessary to grow and maintain our portfolio of investments.

We believe that our available liquidity is sufficient to fund our distributions to stockholders, pay the debt service costs on our existing long-term mortgages and fund our current operating costs in the near term.

We believe that our available liquidity is sufficient to fund our distributions to stockholders, pay the debt service costs, and fund our current operating costs in the near term.

We also believe we will be able to refinance our mortgage debt, bank debt, and long-term private debt as they mature.

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$ 61,316 4,428,514

(1) The primary offering of our Series F Preferred Stock terminated according to its terms on June 1, 2025.

As of February 18, 2026, we had the ability to raise up to $1.0 billion of additional equity capital through the sale and issuance of securities that are registered under the 2024 Registration Statement, in one or more future public offerings.

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As of December 31, 2025, we had mortgage debt in the aggregate principal amount of $35.4 million payable during 2026 and $95.4 million payable during 2027.

The 2025 principal amounts payable include both amortizing principal payments and two balloon principal payments.

We anticipate being able to refinance our mortgages that come due during 2025 and 2026 with a combination of new mortgage debt, availability under our Credit Facility, the issuance of long-term unsecured notes in the private placement market, the issuance of additional equity securities under our 2024 Common Stock Sales Agreement, the sale and issuance of other equity securities (including our Series F Preferred Stock) that are registered under the 2024 Registration Statement, or the sale and issuance of unregistered equity or debt securities.

We have successfully repaid $32.5 million of mortgage debt over the past 12 months with either new mortgage debt or by generating additional availability by adding properties to our unsecured pool under our Credit Facility.

As of December 31, 2024, we also had $75.0 million of the 2029 Notes outstanding.

The 2026 principal amounts payable include both amortizing principal payments and five balloon principal payments.

We anticipate being able to refinance our mortgages that come due during 2026 and 2027 with a combination of new mortgage debt, availability under our Credit Facility, the issuance of long-term unsecured notes in the private placement market, the issuance of additional equity securities under our 2024 Common Stock Sales Agreement, the sale and issuance of other equity securities that are registered under the 2024 Registration Statement, or the sale and issuance of unregistered equity or debt securities.

We have successfully repaid $10.3 million of mortgage debt over the past 12 months through property sales or by generating additional availability by adding properties to our unsecured pool under our Credit Facility.

As of December 31, 2025, we also had $75.0 million of the 2029 Notes outstanding and $85.0 million of the 2030 Notes outstanding.

Operating Activities

Net cash provided by operating activities during the year ended December 31, 2025, was $88.2 million, as compared to net cash provided by operating activities of $57.0 million for the year ended December 31, 2024.

This change was primarily a result of incurring an Incentive Fee in 2024, which was contractually eliminated in the prior year.

This change was primarily a result of an increase in operating revenues due to acquisitions and leasing activity, partially offset by an increase in interest expense due to larger amounts drawn on the Credit Facility, the 2029 Notes, and the 2030 Notes.

The majority of cash from operating activities is generated from the rental payments and operating expense recoveries that we receive from our tenants.

this cash to fund our property-level operating expenses and use the excess cash primarily for debt and interest payments on our mortgage notes payable, interest payments on our Credit Facility, distributions to our stockholders, management fees to our Adviser, administration fees to our Administrator and other entity-level operating expenses.

We utilize this cash to fund our property-level operating expenses and use the excess cash primarily for debt and interest payments on our mortgage notes payable, interest payments on our Credit Facility, interest payments on our unsecured notes, distributions to our

stockholders, management fees to our Adviser, administration fees to our Administrator and other entity-level operating expenses.

Investing Activities

Net cash used in investing activities during the year ended December 31, 2025, was $221.4 million, which primarily consisted of the acquisition of 19 properties, coupled with the capital improvements performed at certain of our properties, partially offset by proceeds from the sale of real estate.

Net cash used in investing activities during the year ended December 31, 2024, was $1.7 million, which primarily consisted of the acquisition of seven properties, coupled with the capital improvements performed at certain of our properties, partially offset by proceeds from the sale of real estate.

Net cash provided by investing activities during the year ended December 31, 2023, was $1.1 million, which primarily consisted of proceeds from the sale of real estate, partially offset by the acquisition of five properties, coupled with the capital improvements performed at certain of our properties.

Financing Activities

Net cash provided by financing activities during the year ended December 31, 2025, was $134.7 million, which primarily consisted of proceeds from our common and preferred equity offerings, mortgage borrowings, net increase in Credit Facility borrowings, and borrowings under unsecured notes, partially offset by the repayment of outstanding mortgage debt, redemptions of Series F Preferred Stock, and distributions paid to our stockholders and Non-controlling OP Unitholders.

Net cash used in financing activities during the year ended December 31, 2024, was $56.3 million, which primarily consisted of proceeds from our common and preferred equity offerings, mortgage borrowings, and borrowings under unsecured notes, partially offset by the repayment of outstanding mortgage debt, net decrease in Credit Facility borrowings, and distributions paid to our stockholders and Non-controlling OP Unitholders.

Net cash used in financing activities for the year ended December 31, 2023, was $61.4 million, which primarily consisted of proceeds from our common and preferred equity offerings, mortgage borrowings on new acquisitions and a net increase in Credit Facility borrowings, partially offset by the repayment of outstanding mortgage debt and distributions paid to our stockholders and Non-controlling OP Unitholders.

Credit Facility

On July 2, 2019, we amended, extended and upsized our Credit Facility, expanding Term Loan A from $75.0 million to $160.0 million, inclusive of a delayed draw component whereby we can incrementally borrow on Term Loan A up to the $160.0 million commitment, and increasing the Revolver from $85.0 million to $100.0 million.

Term Loan A has a maturity date of July 2, 2024, and the Revolver has a maturity date of July 2, 2023.

The interest rate margin for the Credit Facility was reduced by 10 basis points at each of the leverage tiers.

We entered into multiple interest rate cap agreements on Term Loan A, which cap LIBOR ranging from 2.50% to 2.75%, to hedge our exposure to variable interest rates.

We used the net proceeds derived from the amended Credit Facility to repay all previously existing borrowings under the Revolver.

We incurred fees of approximately $1.3 million in connection with the Credit Facility amendment.

The bank syndicate for the Credit Facility is now comprised of KeyBank, Fifth Third Bank, U.S.

Bank National Association, The Huntington National Bank, Goldman Sachs Bank USA, and Wells Fargo Bank, National Association.

On February 11, 2021, we added Term Loan B, a new $65.0 million term loan component, inclusive of a $15.0 million delayed funding component, which was subsequently funded on July 20, 2021.

Term Loan B has a maturity date of 60 months from the closing of the amended Credit Facility and a LIBOR floor of 25 basis points.

We entered into multiple interest rate cap agreements on Term Loan B, which cap LIBOR from 1.50% to 1.75%.

We transitioned our variable rate debt to SOFR, and, at December 31, 2024, all of our variable rate debt was based upon SOFR.

On August 18, 2022, we amended, extended and upsized our Credit Facility, increasing our Revolver from $100.0 million to $120.0 million (and its term to August 2026), adding the new $140.0 million Term Loan C, decreasing the principal balance of Term Loan B to $60.0 million and extending the maturity date of Term Loan A to August 2027.

Term Loan C has a maturity date of February 18, 2028 and a SOFR spread ranging from 125 to 195 basis points, depending on our leverage.

On September 27, 2022, we further increased the Revolver to $125.0 million and Term Loan C to $150.0 million, as permitted under the terms of the Credit Facility.

We entered into multiple interest rate swap agreements on Term Loan C, which swap the interest rate to fixed rates ranging from 3.15% to 3.75%.

We also entered into an interest rate swap agreement on Term Loan A to replace the expiring rate caps, which swaps the interest rate to a fixed rate of 3.70%.

We incurred fees of approximately $4.2 million in connection with extending and upsizing our Credit Facility.

The net proceeds of the transaction were used to repay the then-outstanding borrowings on the Revolver, pay off mortgage debt, and fund acquisitions.

The Credit Facility’s current bank syndicate is comprised of KeyBank, Fifth Third Bank, The Huntington National Bank, Bank of America, Synovus Bank, United Bank, First Financial Bank, and S&T Bank.

As of December 31, 2024, there was $351.9 million outstanding under our Credit Facility at a weighted average interest rate of approximately 5.79% and no outstanding letters of credit.

On August 7, 2013, we procured the Revolver, with KeyBank (serving as a revolving lender, a letter of credit issuer and an administrative agent) for $60.0 million.

On October 5, 2015, we added the $25.0 million Term Loan A.

On February 11, 2021, we added the $65.0 million Term Loan B.

On August 18, 2022, we added the new $140.0 million Term Loan C.

The Credit Facility’s bank syndicate was then comprised of KeyBank, Fifth Third Bank, The Huntington National Bank, Bank of America, Synovus Bank, United Bank, First Financial Bank, and S&T Bank.

On September 18, 2025, we amended our Credit Facility, increasing our Revolver from $125.0 million to $155.0 million.

We incurred fees of approximately $0.5 million in connection with the increase to our Credit Facility.

The increased credit availability was used, in part, to fund a nine-property portfolio acquisition that closed on September 30, 2025.

The SOFR spread increased by 10 basis points, ranging from 140 to 210 basis points for the Revolver and 135 to 205 basis points for the Term Loans, depending on our leverage.

We incurred fees of approximately $4.2 million in connection with amending, extending, and upsizing our Credit Facility.

The Credit Facility’s new (and current) bank syndicate is comprised of KeyBank, Fifth Third Bank, The Huntington National Bank, Bank of America, Synovus Bank, PNC Bank, Webster Bank, and S&T Bank.

As of December 31, 2025, there was $437.4 million outstanding under our Credit Facility at a weighted average interest rate of approximately 5.42%, and $2.1 million outstanding letters of credit, at a weighted average interest rate of 1.60%.

As of February 18, 2026, the maximum additional amount we could draw under the Credit Facility was $60.0 million.

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Operating Lease Obligations (3) 5,226 460 937 855 2,974

Finance Lease Obligations (4) 7,982 172 356 356 7,098

Purchase Obligations (5) 8,021 7,221 800 — —

$ 1,023,131 $ 86,880 $ 339,407 $ 570,842 $ 26,002

(1) Debt obligations represent borrowings under our Revolver, which represents $1.9 million of the debt obligation due in 2026, Term Loan A, which represents $160.0 million of the debt obligation due in 2027, Term Loan B, which represents $40.0 million of the debt obligation due in 2026, Term Loan C, which represents $150.0 million of the debt obligation due in 2028, the 2029 Notes, which represents $75.0 million of the debt obligation due in 2029, and mortgage notes payable that were outstanding as of December 31, 2024.

This figure does not include $(0.01) million of premiums and (discounts), net, and $5.0 million of deferred financing costs, net, which are reflected in mortgage notes payable, net, borrowings under Revolver, and borrowings under Term Loan A, Term Loan B, Term Loan C, net, and the 2029 Notes, net, on the consolidated balance sheet.

(1) Debt obligations represent borrowings under our Revolver, which represents $37.4 million of the debt obligation due in 2029, Term Loan A, which represents $125.0 million of the debt obligation due in 2029, Term Loan B, which represents $143.3 million of the debt obligation due in 2030, Term Loan C, which represents $131.7 million of the debt obligation due in 2028, the 2029 Notes, which represents $75.0 million of the debt obligation due in 2029, the 2030 Notes, which represents $85.0 million of the debt obligation due in 2030, and mortgage notes payable that were outstanding as of December 31, 2025.

This figure does not include $0.02 million of premiums and (discounts), net, and $5.5 million of deferred financing costs, net, which are reflected in mortgage notes payable, net, borrowings under Term Loan A, Term Loan B, Term Loan C, net, and senior unsecured notes, net, on the consolidated balance sheet.

(2) Interest on debt obligations includes estimated interest on our borrowings under our Revolver, Term Loan A, Term Loan B, Term Loan C, senior unsecured notes, and mortgage notes payable.

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(3) Operating lease obligations represent the ground lease payments due on three of our properties.

(4) Finance lease obligations represent the ground lease payments due on one of our properties.

(5) Purchase obligations consist of tenant and capital improvements at ten of our properties.

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FFO available to common stockholders and holders of Non-controlling interests in the Operating Partnership (“Non-controlling OP Unitholders”) is FFO adjusted to subtract preferred share and Senior Common Stock share distributions.

We believe that net loss attributable to common stockholders is the most directly comparable GAAP measure to FFO available to the aggregate of our common stockholders and Non-controlling OP Unitholders.

Basic funds from operations per share (“Basic FFO per share”), and diluted funds from operations per share (“Diluted FFO per share”), is FFO available to common stockholders and Non-controlling OP Unitholders divided by the number of weighted average shares of the aggregate of shares of common stock and OP Units held by Non-controlling OP Unitholders outstanding and FFO available to common stockholders and Non-controlling OP Unitholders divided by the number of weighted average shares of the aggregate of shares of common stock and OP Units held by Non-controlling OP Units outstanding on a diluted basis, respectively, during a period.

We believe that net income available to common stockholders is the most directly comparable GAAP measure to FFO available to the aggregate of our common stockholders and Non-controlling OP Unitholders.

diluted basis, respectively, during a period.

We believe that net income is the most directly comparable GAAP measure to FFO, Basic EPS is the most directly comparable GAAP measure to Basic FFO per share, and that Diluted EPS is the most directly comparable GAAP measure to Diluted FFO per share.

We also present FFO available to our common stockholders and Non-controlling OP Unitholders as adjusted for comparability as an additional supplemental measure, as we believe it is more reflective of our core operating performance, and provides investors and analysts an additional measure to compare our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.

FFO as adjusted for comparability is generally calculated as FFO available to common stockholders and Non-controlling OP Unitholders, excluding certain non-recurring and non-cash income and expense adjustments, which management believes are not reflective of the results within our operating real estate portfolio.

The following table provides a reconciliation of our FFO and FFO as adjusted for comparability for the years ended December 31, 2024 and 2023 to the most directly comparable GAAP measure, net income (loss), and a computation of basic and diluted FFO and diluted FFO as adjusted for comparability per weighted average total share:

The following table provides a reconciliation of our FFO and FFO as adjusted for comparability for the years ended December 31, 2025 and 2024 to the most directly comparable GAAP measure, net income, and a computation of basic and diluted FFO per weighted average total share:

For the twelve months ended December 31,

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Distributions attributable to preferred and senior common stock (12,705) (12,860)

Loss on extinguishment of Series F preferred stock, net (14) (11)

Gain on repurchase of Series G preferred stock — 3

Net income (loss) available (attributable) to common stockholders and Non-controlling OP Unitholders $ 11,166 $ (7,801)

Gain (loss) on extinguishment of Series F preferred stock, net 10 (14)

Net income available to common stockholders and Non-controlling OP Unitholders $ 6,597 $ 11,166

Real estate depreciation and amortization 58,245 55,786

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Distributions attributable to preferred and senior common stock (12,705) (12,860)

Loss on extinguishment of Series F preferred stock, net (14) (11)

Gain on repurchase of Series G preferred stock — 3

Net income (loss) available (attributable) to common stockholders and Non-controlling OP Unitholders $ 11,166 $ (7,801)

Gain (loss) on extinguishment of Series F preferred stock, net 10 (14)

Net income available to common stockholders and Non-controlling OP Unitholders $ 6,597 $ 11,166

Real estate depreciation and amortization 58,245 55,786

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis