What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-18 compared with 2025-02-18 · 233 added, 192 removed, 1160 unchanged (27% of the section changed)

22 unchanged sentences

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Gladstone Commercial Corporation and its subsidiaries (the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive income, of equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes and financial statement schedule listed in the accompanying index (collectively referred to as the “consolidated financial statements”).

We have audited the accompanying consolidated balance sheets of Gladstone Commercial Corporation and its subsidiaries (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of operations and comprehensive income, of equity and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes and schedule of real estate and accumulated depreciation as of December 31, 2025, appearing under Item 8 (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

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Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matter

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

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If circumstances indicate the possibility of impairment, management prepares a projection of the undiscounted future cash flows, without interest charges, of the specific property and determines if the carrying amount of such property is recoverable.

In preparing the projection of undiscounted future cash flows, management estimates cap rates, market rental rates, and tenant improvement allowances using information obtained from market comparability studies and other comparable sources, and applies the undiscounted cash flows against their expected holding period.

If impairment were indicated, the carrying value of the property would be written down to its estimated fair value based on management’s best estimate of the property’s discounted future cash flows using market derived cap rates, discount rates and market rental rates applied against the expected hold period.

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/s/ PricewaterhouseCoopers LLP

Washington, DC

Washington, District Of Columbia

February 18, 2026

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Right-of-use assets from operating leases 3,707 3,961

Right-of-use assets from finance leases, net 2,877 —

Deferred rent receivable, net 47,922 45,324

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Operating lease liabilities 3,816 4,063

Finance lease liabilities 2,964 —

Asset retirement obligation 5,363 5,061

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and 379,223 and 389,190 shares issued and outstanding at December 31, 2025 and December 31, 2024, respectively (3)

Common stock, par value $ 0.001 per share, 62,400,887 and 62,326,818 shares authorized and 43,986,038 and 40,000,596 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively (3)

Common stock, par value $ 0.001 per share, 62,599,663 and 62,400,887 shares authorized;

and 48,406,993 and 43,986,038 shares issued and outstanding at December 31, 2025 and December 31, 2024, respectively (3)

Series F redeemable preferred stock, par value $ 0.001 per share;

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Total operating expenses $ 101,389 $ 102,808 $ 116,103

Other income (expense)

Other (expense) income

Interest expense $ ( 41,914 ) $ ( 37,395 ) $ ( 37,330 )

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Other income 892 326 204

Total other expense, net $ ( 22,540 ) $ ( 26,559 ) $ ( 21,951 )

Total other (expense) income, net $ ( 40,655 ) $ ( 22,540 ) $ ( 26,559 )

Net income $ 19,292 $ 24,040 $ 4,922

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Distributions attributable to senior common stock ( 406 ) ( 420 ) ( 430 )

Loss on extinguishment of Series F preferred stock, net ( 14 ) ( 11 ) ( 10 )

Gain (loss) on extinguishment of Series F preferred stock, net 10 ( 14 ) ( 11 )

Gain on repurchase of Series G preferred stock — — 3

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Weighted average shares of senior common stock outstanding - basic 386,691 398,828 409,903

Comprehensive income (loss)

Change in unrealized gain (loss) related to interest rate hedging instruments, net $ 2,702 $ ( 4,853 ) $ 12,115

Other comprehensive income (loss) 2,702 ( 4,853 ) 12,115

Comprehensive (loss) income

Change in unrealized (loss) gain related to interest rate hedging instruments, net $ ( 7,349 ) $ 2,702 $ ( 4,853 )

Other comprehensive (loss) income ( 7,349 ) 2,702 ( 4,853 )

Net income $ 19,292 $ 24,040 $ 4,922

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Conversion of senior common stock to common stock — 18,114 ( 24,639 ) — — — — — — — — —

Retirement of senior common stock, net — — — — — — 52 — — 52 — 52

Distributions declared to common, senior common, preferred stockholders and Non-controlling OP Unit holders — — — — — — — — ( 60,649 ) ( 60,649 ) ( 457 ) ( 61,106 )

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Reclassification into interest expense — — — — — — — 971 — 971 — 971

Issuance of Non-controlling OP Units as consideration in real estate acquisitions, net — — — — — — — — — — 2,394 2,394

Redemptions of OP Units — 80,825 — — — — 1,040 — — 1,040 ( 1,040 ) —

Redemption of Series F preferred stock, net — — — — — — 477 — ( 11 ) 466 — 466

Repurchase of Series G preferred stock, net — — — — — — — — 3 3 — 3

Repurchase of common stock, net — ( 80,780 ) — — — — 998 — — 998 — 998

Adjustment to OP Units held by Non-controlling OP Unitholders resulting from changes in ownership of the Operating Partnership — — — — — — ( 756 ) — — ( 756 ) 756 —

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Conversion of senior common stock to common stock — 14,676 ( 17,235 ) — — — — — — — — —

Retirement of senior common stock, net — — — — — — 52 — — 52 — 52

Distributions declared to common, senior common, preferred stockholders and Non-controlling OP Unit holders — — — — — — — — ( 63,120 ) ( 63,120 ) ( 184 ) ( 63,304 )

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Redemption of Series F preferred stock, net ( 74,068 ) — — — — — 1,698 — ( 14 ) 1,684 — 1,684

Repurchase of Series G preferred stock, net — — — — — — — 3 3 — 3

Repurchase of common stock, net — ( 80,780 ) — — — — 998 — — 998 — 998

Adjustment to OP Units held by Non-controlling OP Unitholders resulting from changes in ownership of the Operating Partnership — — — — — — ( 3,151 ) — — ( 3,151 ) 3,151 —

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Reclassification into interest expense — — — — — — — 15 — 15 — 15

Redemptions of OP Units — 271,169 — — — — 3,865 — — 3,865 ( 3,865 ) —

Redemption of Series F preferred stock, net ( 198,776 ) — — — — — ( 4,520 ) — 10 ( 4,510 ) — ( 4,510 )

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Amortization of deferred rent asset and liability, net ( 6,029 ) ( 6,813 ) ( 7,457 )

Increase in sales-type lease receivable ( 136 ) — —

Decrease (increase) in sales-type lease receivable 153 ( 136 ) —

Receipt of sales-type lease receivable 18,465 — —

Amortization of discount and premium on assumed debt, net 27 34 41

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Amortization of right-of-use asset from operating leases and operating lease liabilities, net 7 7 27

Amortization of right-of-use asset finance lease liabilities, net 26 — —

Bad debt expense — 64 —

Operating changes in assets and liabilities

Decrease (increase) in other assets 1,278 1,483 ( 619 )

Decrease in deferred rent receivable ( 5,541 ) ( 3,161 ) ( 1,330 )

(Decrease) increase in accounts payable and accrued expenses ( 41 ) ( 11 ) 1,600

Decrease in amount due to Adviser and Administrator ( 16 ) ( 800 ) ( 75 )

Decrease in other liabilities ( 983 ) ( 722 ) ( 942 )

Increase (decrease) in other assets ( 448 ) 1,278 1,483

Increase in deferred rent receivable ( 3,025 ) ( 5,541 ) ( 3,161 )

Increase (decrease) in accounts payable and accrued expenses 796 ( 41 ) ( 11 )

Increase (decrease) in amount due to Adviser and Administrator 683 ( 16 ) ( 800 )

Increase (decrease) in other liabilities 506 ( 983 ) ( 722 )

Leasing commissions paid ( 2,774 ) ( 4,783 ) ( 2,312 )

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Repayments on term loan ( 53,333 ) ( 20,000 ) —

Borrowings on unsecured term loan 20,000 — —

Repayments on unsecured term loan ( 20,000 ) — —

Borrowings under senior unsecured notes 85,000 75,000 —

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Increase in security deposits 1,379 158 104

Distributions paid for common, senior common, preferred stock and Non-controlling OP Unitholders ( 62,788 ) ( 60,620 ) ( 71,092 )

Net cash (used in) provided by financing activities $ ( 56,287 ) $ ( 61,362 ) $ 16,150

Net (decrease) increase in cash, cash equivalents, and restricted cash $ ( 1,061 ) $ 143 $ 2,814

Distributions paid to common, senior common, preferred stock and Non-controlling OP Unitholders ( 68,173 ) ( 62,788 ) ( 60,620 )

Net cash provided by (used in) financing activities $ 134,743 $ ( 56,287 ) $ ( 61,362 )

Net increase (decrease) in cash, cash equivalents, and restricted cash $ 1,517 $ ( 1,061 ) $ 143

Cash, cash equivalents, and restricted cash at beginning of period $ 15,074 $ 16,135 $ 15,992

Cash, cash equivalents, and restricted cash at end of period $ 16,591 $ 15,074 $ 16,135

SUPPLEMENTAL AND NON-CASH INFORMATION

SUPPLEMENTAL INFORMATION

Cash paid for interest $ 38,714 $ 35,666 $ 33,136

NON-CASH INFORMATION

Tenant funded fixed asset improvements included in deferred rent liability, net $ — $ ( 479 ) $ ( 1,312 )

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Capital improvements and leasing commissions included in accounts payable and accrued expenses $ 2,090 $ 5,125 $ 5,475

Unrealized gain related to interest rate hedging instruments, net $ 2,702 $ ( 4,853 ) $ 12,115

Increase in asset retirement obligation assumed in acquisition $ — $ 95 $ 979

Non-controlling OP Units issued in connection with acquisition $ — $ — $ 2,394

Unrealized (loss) gain related to interest rate hedging instruments, net $ ( 7,349 ) $ 2,702 $ ( 4,853 )

Increase in asset retirement obligation in connection with acquisition $ 164 $ — $ 95

Dividends paid on Series F preferred stock via additional share issuances $ 427 $ 516 $ 487

Right-of-use asset from finance leases $ 2,938 $ — $ —

Finance lease liabilities $ ( 2,938 ) $ — $ —

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same amounts shown in the consolidated statements of cash flows (dollars in thousands):

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Total amortization expense related to deferred financing costs is included in interest expense and was $ 2.4 million, $ 1.6 million, and $ 1.6 million for the years ended December 31, 2025, 2024, and 2023, respectively.

Gains (Losses) on Sale of Real Estate, Net

Gains (losses) on sale of real estate, net, consist of the excess consideration received for a property over the property carrying value at the time of sale, or gains on real estate, offset by consideration received for a property less than the property carrying value at the time of sale, or loss on sale of real estate.

Gains on Sale of Real Estate, Net

Gains on sale of real estate, net, consist of the excess consideration received for a property over the property carrying value at the time of sale, or gains on real estate, offset by consideration received for a property less than the property carrying value at the time of sale, or loss on sale of real estate.

Lease Revenue

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In the event that the collectability of deferred rent with respect to any given tenant is in doubt, we record an allowance for uncollectible accounts or record a direct write-off of the specific rent receivable.

We incurred $ 0.1 million, $ 0.4 million, and $ 0.4 million in deferred rent write offs during each of the years ended December 31, 2024, 2023, and 2022, respectively.

We did not incur deferred rent write offs during the year ended December 31, 2025, and incurred $ 0.1 million and $ 0.4 million in deferred rent write offs during the years ended December 31, 2024 and 2023, respectively.

Tenant recovery revenue includes payments from tenants as reimbursements for franchise taxes, management fees, insurance, maintenance and repairs, utilities, and ground lease payments.

We recognize tenant recovery revenue in the same periods that we incur the related expenses.

We recognize tenant recovery revenue in the same periods that

we incur the related expenses.

We do not record any tenant recovery revenues or operating expenses associated with costs paid directly by our tenants for our net leased properties.

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The liabilities are accreted to their estimated obligation over the life of the leases for the respective properties.

We did not accrue any liabilities in connection with acquisitions for the year ended December 31, 2024, and accrued $ 0.1 million and $ 1.0 million of liabilities in connection with acquisitions for the years ended December 31, 2023, and 2022, respectively.

We accrued $ 0.2 million and $ 0.1 million of liabilities in connection with acquisitions for the years ended December 31, 2025, and 2023, respectively, and did not accrue any liabilities in connection with acquisitions for the year ended December 31, 2024.

We recorded accretion expense of $ 0.1 million in each of the years ended December 31, 2025, 2024, and 2023, to general and administrative expense.

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We record the effective portion of changes in the fair value of the interest rate cap and swap agreements that qualify as cash flow hedges to accumulated other comprehensive income.

For the years ended December 31, 2024, 2023, and 2022, we reconciled net income to comprehensive income on the consolidated statements of operations and comprehensive income in the accompanying consolidated financial statements.

For the years ended December 31, 2025, 2024, and 2023, we

reconciled net income to comprehensive income on the consolidated statements of operations and comprehensive income in the accompanying consolidated financial statements.

Segment Reporting

In November 2023, the Financial Accounting Standards Board (“FASB”) issued accounting standard update (“ASU”) 2023-07, “Segment Reporting - Improvements to Reportable Segment Disclosures” to improve reportable segments disclosure requirements.

The ASU requires existing annual segment disclosures to also be disclosed on an interim basis and also requires additional disclosures around significant segment expenses and disclosures to identify the title and position of the chief operating decision maker (“CODM”).

The standard is effective for the fiscal year ended December 31, 2024, and interim periods thereafter.

We adopted ASU 2023-07 as of December 31, 2024.

Our current business strategy includes one reporting segment:

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Cooper, is also an executive vice president of commercial and industrial real estate of our Adviser.

Michael LiCalsi, our general counsel and secretary, also serves as our Administrator’s president, general counsel and secretary , as well as executive vice president of administration of our Adviser .

We have entered into an advisory agreement with our Adviser, as amended from time to time (the “Advisory Agreement”), and an administration agreement with our Administrator (the “Administration Agreement”).

Michael LiCalsi, our chief administrative officer, co-general counsel, and co-secretary, also serves in the same roles for our Adviser and Administrator (in addition to serving as president of our Administrator).

Erich Hellmold, our co-general counsel and co-secretary, also serves in the same roles for our Adviser and Administrator.

The services and fees under the Advisory Agreement and Administration Agreement are described below.

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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.

On January 10, 2023, the Company amended and restated the Sixth Amended Advisory Agreement by entering into the Seventh Amended and Restated Investment Advisory Agreement between the Company and the Adviser (the “Seventh Amended Advisory Agreement”), as approved unanimously by our Board of Directors, including specifically, our independent directors.

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For the year ended December 31, 2025, we recorded an incentive fee of $ 2.8 million, partially offset by credits related to non-contractual, unconditional, and irrevocable waivers issued by the Adviser of $ 1.5 million.

For the year ended December 31, 2024, we recorded an incentive fee of $ 4.5 million, partially offset by credits related to non-contractual, unconditional, and irrevocable waivers issued by the Adviser of $ 2.3 million.

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

For the year ended December 31, 2022, we recorded an incentive fee of $ 5.3 million.

Our Adviser did no t waive any portion of the incentive fee for the year ended December 31, 2022.

Waivers are non-contractual, unconditional, and irrevocable and cannot be recouped by the Adviser in the future.

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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 we have 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.

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, 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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The amount of the financing fees may be reduced or eliminated, as determined by us and Gladstone Securities, after taking into consideration various factors, including, but not limited to, the involvement of any third-party brokers and market conditions.

We paid financing fees to Gladstone Securities of $ 0.1 million, $ 0.1 million, and $ 0.3 million during the years ended December 31, 2024, 2023, and 2022, respectively, which are included in mortgage notes payable, net, in the consolidated balance sheets, or 0.28 %, 0.29 %, and 0.33 % of total mortgage principal secured or extended during the respective periods.

We did not pay financing fees to Gladstone Securities during the year ended December 31, 2025 and paid financing fees of $ 0.1 million, and $ 0.1 million to Gladstone Securities during the years ended December 31, 2024 and 2023, respectively, which are included in mortgage notes payable, net, in the consolidated balance sheets, or 0.28 %, and 0.29 % of total mortgage principal secured or extended during the respective periods.

Our Board of Directors renewed the agreement for an additional year, through August 31, 2026, at its July 2025 meeting.

Dealer Manager Agreement

On February 20, 2020, we entered into a dealer manager agreement, as amended by that certain First Amendment on February 9, 2023 (the “Dealer Manager Agreement”), whereby Gladstone Securities will act as the exclusive dealer manager in connection with our offering (the “Offering”) of up to (i) 20,000,000 shares of our 6.00 % Series F Cumulative Redeemable Preferred Stock of the Company, par value $ 0.001 per share (the “Series F Preferred Stock”), on a “reasonable best efforts” basis (the “Primary Offering”), and (ii) 6,000,000 shares of Series F Preferred Stock pursuant to our distribution reinvestment plan (the “DRIP”) to those holders of the Series F Preferred Stock who participate in such DRIP.

On February 20, 2020, we entered into a dealer manager agreement, as amended by that certain First Amendment on February 9, 2023 (the “Dealer Manager Agreement”), whereby Gladstone Securities acted as the exclusive dealer manager in connection with our offering (the “Offering”) of up to (i) 20,000,000 shares of our 6.00 % Series F Cumulative Redeemable Preferred Stock of the Company, par value $ 0.001 per share (the “Series F Preferred Stock”), on a “reasonable best efforts” basis (the “Primary Offering”), and (ii) 6,000,000 shares of Series F Preferred Stock pursuant to our distribution reinvestment plan (the “DRIP”) to those holders of the Series F Preferred Stock who participated in such DRIP.

The Series F Preferred Stock was previously registered with the SEC pursuant to a registration statement on Form S-3 (File No.

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The Series F Preferred Stock is currently registered with the SEC pursuant to a registration statement on Form S-3 (File No.

333-277877), as the same may be amended and/or supplemented (the “2024 Registration Statement”), under the Securities Act, and is offered and sold pursuant to a prospectus supplement dated May 1, 2024, and a base prospectus dated March 21, 2024 relating to the 2024 Registration Statement (the “Prospectus”).

333-277877), as the same may be amended and/or supplemented (the “2024 Registration Statement”), under the Securities Act, and was offered and sold pursuant to a prospectus supplement dated May 1, 2024, and a base prospectus dated March 21, 2024 relating to the 2024 Registration Statement (the “Prospectus”).

During the years ended December 31, 2023 and 2024, the Series F Preferred Stock was registered with the SEC pursuant to the 2022 Registration Statement, and offered and sold pursuant to a prospectus supplement, dated February 9, 2023, and a base prospectus dated November 23, 2022.

During the year ended December 31, 2025, the Series F Preferred Stock was registered with the SEC pursuant to the 2024 Registration Statement, and offered and sold pursuant to a prospectus supplement, dated May 1, 2024, and a base prospectus dated March 21, 2024.

Under the Dealer Manager Agreement, Gladstone Securities, as dealer manager, will provide certain sales, promotional and marketing services to the Company in connection with the Offering, and the Company will pay Gladstone Securities (i) selling commissions of 6.0 % of the gross proceeds from sales of Series F Preferred Stock in the Primary Offering (the “Selling Commissions”), and (ii) a dealer manager fee of 3.0 % of the gross proceeds from sales of Series F Preferred Stock in the Primary Offering (the “Dealer Manager Fee”).

No Selling Commissions or Dealer Manager Fee shall be paid with respect to Shares sold pursuant to the DRIP.

Gladstone Securities may, in its sole discretion, reallow a portion of the Dealer Manager Fee to participating broker-dealers in support of the Offering.

Under the Dealer Manager Agreement, Gladstone Securities, as dealer manager, provided certain sales, promotional and marketing services to us in connection with the Offering, and we paid Gladstone Securities (i) selling commissions of 6.0 % of the gross proceeds from sales of Series F Preferred Stock in the Primary Offering (the “Selling Commissions”), and (ii) a dealer manager fee of 3.0 % of the gross proceeds from sales of Series F Preferred Stock in the Primary Offering (the “Dealer Manager Fee”).

No Selling Commissions or Dealer Manager Fee are paid with respect to shares sold pursuant to the DRIP.

Gladstone Securities had sole discretion to re-allow for payment of a portion of the Dealer Manager Fee to participating broker-dealers in support of the Offering.

We paid fees of $ 0.03 million, $ 0.1 million, and $ 0.5 million to Gladstone Securities during the years ended December 31, 2025, 2024 and 2023, respectively, in connection with the Offering.

Earnings (loss) per Share of Common Stock

The following tables set forth the computation of basic and diluted earnings (loss) per share of common stock for the years ended December 31, 2024, 2023 and 2022, respectively.

The OP Units held by Non-controlling OP Unitholders (which may be redeemed for shares of common stock) have been excluded from the diluted earnings per share calculation, as there would be no effect on the amounts since the Non-controlling OP Unitholders’ share of income would also be added back to net income.

Net income figures are presented net of such non-controlling interests in the earnings per share calculation.

We computed basic earnings (loss) per share for the years ended December 31, 2024, 2023 and 2022, respectively, using the weighted average number of shares outstanding during the periods.

Diluted earnings (loss) per share for the years ended December 31, 2024, 2023 and 2022, reflects additional shares of common stock related to our convertible Senior Common Stock, if the effect would be dilutive, that would have been outstanding if dilutive potential shares of common stock had been issued, as well as an adjustment to net income (loss) available (attributable) to common stockholders as applicable to common stockholders that would result from their assumed issuance (dollars in thousands, except per share amounts).

For the year ended December 31,

2024 2023 2022

Calculation of basic earnings (loss) per share of common stock:

Net income (loss) available (attributable) to common stockholders $ 11,124 $ ( 7,738 ) $ ( 1,529 )

Denominator for basic weighted average shares of common stock (1) 41,766,263 39,943,167 38,950,734

Basic earnings (loss) per share of common stock $ 0.27 $ ( 0.19 ) $ ( 0.04 )

Calculation of diluted earnings (loss) per share of common stock:

Net income (loss) available (attributable) to common stockholders $ 11,124 $ ( 7,738 ) $ ( 1,529 )

Net income (loss) available (attributable) to common stockholders plus assumed conversions (2) $ 11,124 $ ( 7,738 ) $ ( 1,529 )

Denominator for basic weighted average shares of common stock (1) 41,766,263 39,943,167 38,950,734

Effect of convertible Senior Common Stock (2) — — —

Denominator for diluted weighted average shares of common stock (2) 41,766,263 39,943,167 38,950,734

Diluted earnings (loss) per share of common stock $ 0.27 $ ( 0.19 ) $ ( 0.04 )

(1) The weighted average number of OP Units held by Non-controlling OP Unitholders was 157,160 , 382,563 , and 294,941 for the years ended December 31, 2024, 2023, and 2022, respectively.

(2) We excluded convertible shares of Senior Common Stock of 330,456 , 345,132 and 363,246 from the calculation of diluted earnings per share for the years ended December 31, 2024, 2023 and 2022, respectively, because it was anti-dilutive.

Real Estate and Intangible Assets

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Real estate depreciation expense on building and tenant improvements was $ 42.2 million, $ 39.5 million, and $ 41.2 million for the years ended December 31, 2025, 2024, and 2023, respectively.

During the years ended December 31, 2024 and 2023, we acquired seven and five properties, respectively, which are summarized below (dollars in thousands):

Year Ended Aggregate Square Footage Weighted Average Lease Term Aggregate Purchase Price Aggregate Capitalized Acquisition Costs

December 31, 2024 (1) 316,727 20.8 years $ 27,357 $ 570

December 31, 2023 (2) 321,432 19.3 years $ 30,018 $ 528

(1) On May 7, 2024, we acquired a five - property, 142,125 square foot portfolio in Warfordsburg, Pennsylvania for $ 12.0 million.

The property is fully leased to one tenant and had 25.1 years of remaining lease term at the time we acquired the property.

On August 29, 2024, we acquired a 50,102 square foot property in Midland, Texas for $ 10.2 million.

The property is fully leased to one tenant and had 15.0 years of remaining lease term at the time we acquired the property.

On November 15, 2024, we acquired a 124,500 square foot property in St.

Clair, Missouri for $ 5.2 million.

The property is fully leased to one tenant and had 20.0 years of remaining lease term at the time we acquired the property.

(2) On April 14, 2023, we acquired a 76,089 square foot property in Riverdale, Illinois for $ 5.4 million.

The property is fully leased to one tenant and had 20.0 years of remaining lease term at the time we acquired the property.

On July 10, 2023, we acquired a 7,714 square foot property in Dallas-Fort Worth, Texas for $ 3.0 million.

The property is fully leased to one tenant and had 9.9 years of remaining lease term at the time we acquired the property.

On July 28, 2023, we acquired a 100,000 square foot property in Dallas-Fort Worth, Texas for $ 9.2 million.

The property is fully leased to one tenant and had 20.0 years of remaining lease term at the time we acquired the property.

On October 12, 2023, we acquired a 69,920 square foot property in Allentown, Pennsylvania for $ 7.9 million.

The property is fully leased to one tenant and had 20.1 years of remaining lease term at the time we acquired the property.

On November 3, 2023, we acquired a 67,709 square foot property in Indianapolis, Indiana for $ 4.6 million.

The property is fully leased to one tenant and had 20.1 years of remaining lease term at the time we acquired the property.

During the years ended December 31, 2025 and 2024, we acquired 19 and seven industrial properties, respectively, which are summarized below (dollars in thousands):

Year ended December 31, 2025

Location Aggregate Number of Properties (unaudited) Acquisition Date Aggregate Square Footage (unaudited) Weighted Average Remaining Lease Term at Time of Acquisition Aggregate Purchase Price Aggregate Capitalized Acquisition Expenses

Houston, TX 5 February 19, 2025 215,474 10.0 years $ 29,457 $ 207

Dallas, TX 1 March 28, 2025 140,304 11.3 years 44,268 268

Germantown, WI 1 May 9, 2025 303,991 19.4 years 62,851 151

Harrison Township, MI 3 June 25, 2025 215,102 10.0 years 16,491 241

Cartersville, GA 1 September 30, 2025 117,430 20.0 years 12,195 56

Ossian, IN 1 September 30, 2025 263,756 20.0 years 19,531 56

Ligonier, IN 1 September 30, 2025 159,277 20.0 years 10,641 56

Caro, MI 4 September 30, 2025 86,751 20.0 years 5,823 58

Chesterfield, MI 1 September 30, 2025 39,701 20.0 years 4,747 57

Cass City, MI 1 September 30, 2025 26,321 20.0 years 1,901 55

19 1,568,107 15.9 years $ 207,905 $ 1,205

Year ended December 31, 2024

Warfordsburg, PA 5 May 7, 2024 142,125 25.1 years $ 11,954 $ 267

Midland, TX 1 August 29, 2024 50,102 15.0 years 10,168 168

Clair, MO 1 November 15, 2024 124,500 20.0 years 5,235 135

7 316,727 20.8 years $ 27,357 $ 570

We determined the fair value of assets acquired and liabilities assumed related to the properties acquired during the years ended December 31, 2025 and 2024, respectively, as follows (dollars in thousands):

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Total Purchase Price $ 207,905 $ 27,357

(1) This amount includes $ 90 of loans receivable included in Other assets on the consolidated balance sheets.

(1) The Dallas-Fort Worth, Texas property that we acquired is subject to a ground lease, therefore there is no land asset included on the condensed consolidated balance sheets.

(2) This amount includes $ 838 and $ 90 of loans receivable included in Other assets on the consolidated balance sheets, respectively.

(3) This amount includes $ 1,627 and $ 155 of prepaid rent included in Other liabilities on the consolidated balance sheets, respectively.

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Thereafter 571,121

Future sales-types lease payments from tenants under non-cancelable leases and reasonably certain purchase options, for each of the five succeeding fiscal years and thereafter is as follows (dollars in thousands):

Year Tenant Lease Payments

2025 $ 19,722

Difference between undiscounted cash flow and present value 1,086

Sales-type lease receivable $ 18,636

In accordance with the lease terms, substantially all operating expenses are required to be paid by the tenant;

In accordance with the lease terms, substantially all operating expenses are required to be paid by the tenant directly, or reimbursed to us from the tenant;

however, we would be required to pay operating expenses on the respective properties in the event the tenants fail to pay them.

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Sales-Type Leases

For the year ended December 31, 2024, we had one lease classified as a sales-type lease.

During the year ended December 31, 2024 , we had one lease classified as a sales-type lease.

We recorded a sales-type lease receivable of $ 18.6 million in the consolidate d balance sheet, net of $ 0.02 million in allowance for credit loss, and derecognized the carry value of $ 14.6 million in the consolidated balance sheet.

We recognized a $ 3.9 million selling profit from sale-type leases, net, that was included in gain on sale of real estate, net, in the consolidated statements of operations.

For the year ended December 31, 2024, t he interest income earned from sales-types leases of $ 0.1 million was included in other income in the consolidated statements of operations.

There was no sales-type lease activity in the years ended December 31, 2023 and 2022.

In developing the expected credit loss, we reviewed the tenant’s credit rating, which is AA- stable, and performed a

collectibility analysis, confirming they were current on payments as of December 31, 2024.

The sales-type lease receivable, net, approximates fair value as of December 31, 2024.

For the years ended December 31, 2025 and 2024 , t he interest income earned from sales-types leases of $ 0.5 million and $ 0.1 million, respectively, was included in other income in the consolidated statements of operations.

There was no sales-type lease activity in the year ended December 31, 2023.

In developing the expected credit loss, we reviewed the tenant’s credit rating, which was AA- stable, and performed a collectibility analysis, confirming they were current on payments as of December 31, 2024.

The sales-type lease receivable, net, approximated fair value as of December 31, 2024.

On April 1, 2025, the tenant exercised their purchase option provided in their lease agreement with us.

The sale transaction was completed on April 30, 2025, resulting in the realization of the sales-type lease receivable from the consolidated balance sheets.

Refer to Note 4, “Real Estate Dispositions, Held for Sale, and Impairment Charges” for additional detail.

Accounts Receivable

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Intangible Assets

The following table summarizes the carrying value of intangible assets, liabilities and the accumulated amortization for each intangible asset and liability class as of December 31, 2024 and 2023, excluding real estate held for sale as of December 31, 2024 (dollars in thousands):

The following table summarizes the carrying value of intangible assets, liabilities and the accumulated amortization for each intangible asset and liability class as of December 31, 2025 and 2024, excluding real estate held for sale (dollars in thousands):

December 31, 2025 December 31, 2024

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Total amortization related to below-market lease values was $ 6.5 million, $ 7.3 million, and $ 8.0 million for the years ended December 31, 2025, 2024, and 2023, respectively, and is included in lease revenue in the consolidated statement of operations and comprehensive income.

We acquired 19 industrial properties during the year ended December 31, 2025, and acquired seven industrial properties during the year ended December 31, 2024.

The weighted average amortization periods in years for the intangible assets acquired and liabilities assumed during the years ended December 31, 2025 and 2024, respectively, were as follows:

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Real Estate Dispositions

During the year ended December 31, 2024, we continued to execute our capital recycling program, whereby we sold 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 use the sales 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 sell properties and redeploy 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 is 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.

Our 2025 dispositions were not classified as discontinued operations because they did not represent a strategic shift in operations, nor will they have a major effect on our operations and financial results.

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(1) Includes a $ 0.01 million impairment charge.

(2) Includes a $ 10.3 million gain on sale of real estate, net, from seven property sales and a $ 0.3 million gain on debt extinguishment from two property sales.

(2) Includes a $ 0.4 million gain on sale of real estate, net, from two property sales.

(3) Includes a $ 1.8 million impairment charge.

Real Estate Held for Sale

At December 31, 2024, we had two properties classified as held for sale, located in Hickory, North Carolina and Tifton, Georgia.

We consider these assets to be non-core to our long term strategy.

At December 31, 2023, we had three properties classified as held for sale, located in Richardson, Texas;

Columbus, Ohio;

and Tifton, Georgia.

The table below summarizes the components of the assets held for sale at December 31, 2024 reflected on the accompanying consolidated balance sheet (dollars in thousands):

At December 31, 2025, we had one property classified as held for sale, located in Charlotte, North Carolina, and a portion of a land parcel held for sale, located in Ocala, Florida.

At December 31, 2024, we had two properties classified as held for sale, located in Tifton, Georgia and Hickory, North Carolina, and which have been sold as described above.

The table below summarizes the components of the assets held for sale at December 31, 2025 and 2024 reflected on the accompanying consolidated balance sheet (dollars in thousands):

December 31, 2025 December 31, 2024

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Lease intangibles, net 832 26

Deferred rent receivable, net — 7

Total Assets Held for Sale $ 11,260 $ 4,363

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Impairment Charges

We evaluated our portfolio for triggering events to determine if any of our held and used assets were impaired during the year ended December 31, 2024 and identified one held and used asset, located in Oklahoma City, Oklahoma, which was impaired by $ 1.8 million during the quarter ended December 31, 2024.

In performing our impairment testing, the undiscounted cash flows were below the carrying value, which resulted in recognizing an impairment charge.

We evaluated our held for sale assets to determine if any of these assets were impaired during the year ended December 31, 2024 and identified two held for sale assets, located in Richardson, Texas and Fridley, Minnesota, which were impaired by an aggregate $ 5.0 million during the three months ended March 31, 2024 and September 30, 2024.

In performing our held for sale assessment, the carrying value of these assets were above the fair value, less costs of sale.

As a result, we impaired these properties to equal the fair market value less costs of sale.

The properties were sold during the year ended December 31, 2024.

During the year ended December 31, 2023, we identified two held and used assets, located in Draper, Utah and Egg Harbor, New Jersey, which were impaired by an aggregate $ 8.0 million during the quarters ended September 30, 2023 and December 31, 2023.

We evaluated our portfolio for triggering events to determine if any of our held and used assets were impaired during the year ended December 31, 2025 and did not recognize an impairment charge.

We evaluated our held for sale assets to determine if any of these assets were impaired during the year ended December 31, 2025 and identified one held for sale asset, located in Oklahoma City, Oklahoma, which was impaired by $ 0.01 million during the three months ended June 30, 2025.

In performing our held for sale assessment, the carrying value of this asset was above the fair value, less costs of sale.

As a result, we impaired this property to equal the fair market value less costs of sale.

The property was sold during the year ended December 31, 2025.

During the year ended December 31, 2024, we identified one held and used asset, located in Oklahoma City, Oklahoma, which was impaired by $ 1.8 million during the quarter ended December 31, 2024.

In performing our impairment testing, the undiscounted cash flows were below the carrying value, which resulted in an impairment charge.

We also identified three held for sale assets, located in Richardson, Texas, Taylorsville, Utah, and Columbus, Ohio, which were impaired by an aggregate $ 11.3 million during the three months ended June 30, 2023 and December 31, 2023.

We also identified two held for sale assets, located in Richardson, Texas and Fridley, Minnesota, which were impaired by an aggregate $ 5.0 million during the three months ended March 31, 2024 and September 30, 2024.

In performing our held for sale assessment, the carrying value of these assets were above the fair value, less costs of sale, which resulted in us recognizing an impairment charge.

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We continue to evaluate our properties on a quarterly basis for changes that could create the need to record impairment.

impact the estimated cash flow of our properties over the period in which we plan to hold our properties.

Future impairment losses may result, and could be significant, should market conditions deteriorate in the markets in which we hold our assets or we are unable to secure leases at terms that are favorable to us, which could impact the estimated cash flow of our properties over the period in which we plan to hold our properties.

Additionally, changes in management’s decisions to either own and lease long-term or sell a particular asset will have an impact on this analysis.

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Fixed rate mortgage loans 44 $ 251,578 $ 264,243 (1) (2)

Variable rate mortgage loans 1 7,260 — SOFR + 2.25 %

Variable rate mortgage loans — — 7,260 N/A N/A

Premiums and discounts, net — 19 ( 8 ) N/A N/A

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(3) 10/10/2029

Deferred financing costs, revolving credit facility — — — N/A N/A

Total revolver — $ 37,370 $ 1,900

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Senior unsecured notes 2029 — $ 75,000 $ 75,000 6.47 % 12/18/2029

Senior unsecured notes 2030 — $ 85,000 $ — 5.99 % 12/15/2030

Deferred financing costs, senior unsecured notes — ( 1,799 ) ( 1,042 ) N/A N/A

Total senior unsecured notes, net N/A $ 158,201 $ 73,958

Total mortgage notes payable, credit facility.

and senior unsecured notes 133 $ 693,385 $ 738,861 (5)

Total mortgage notes payable, credit facility, and senior unsecured notes 44 $ 843,466 $ 693,385 (5)

(1) Interest rates on our fixed rate mortgage notes payable vary from 2.80 % to 6.63 %.

(2) We have 40 mortgage notes payable with maturity dates ranging from September 30, 2025 through August 1, 2037.

(2) We have 38 mortgage notes payable with maturity dates ranging from April 1, 2026 through August 1, 2037.

(3) As of December 31, 2025, SOFR was approximately 3.87 %.

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As of December 31, 2025, we did not have any recourse mortgages.

We will also indemnify lenders against claims resulting from the presence of hazardous substances or activity involving hazardous substances in violation of environmental laws on a property.

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

From time to time, we will also indemnify lenders against claims resulting from the presence of hazardous substances or activity involving hazardous substances in violation of environmental laws on a property.

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 5.60 %

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 issued an aggregate $ 75.0 million in senior unsecured notes in a private placement, at a fixed interest rate of 6.47 % and a maturity date of December 18, 2029 (the “2029 Notes”).

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

Scheduled principal payments of mortgage notes payable for each of the five succeeding fiscal years and thereafter are as follows (dollars in thousands):

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$ 251,578 (1)

(1) This figure does not include $( 0.01 ) million premiums and (discounts), net, and $ 1.9 million of deferred financing costs, which are reflected in mortgage notes payable on the consolidated balance sheets.

(1) This figure does not include $ 19,149 premiums and (discounts), net, and $ 1.4 million of deferred financing costs, which are reflected in mortgage notes payable on the consolidated balance sheets.

We believe we will be able to address all mortgage notes payable maturing over the next 12 months through a combination of refinancing our existing indebtedness, cash from operations, proceeds from one or more equity offerings and availability on our Credit Facility.

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(1) We have entered into an interest rate cap agreement on variable rate debt with a SOFR cap of 5.50 %.

We have assumed or entered into interest rate swap agreements in connection with certain of our mortgage financings and Credit Facility, whereby we will pay our counterparty a fixed interest rate on a monthly basis, and receive payments from our counterparty equivalent to the stipulated floating rate.

This cap matured in March 2025.

counterparty equivalent to the stipulated floating rate.

The fair value of our interest rate swap agreements is recorded in other assets or liabilities on our accompanying consolidated balance sheets.

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The following tables present the impact of our derivative instruments in the consolidated financial statements (dollars in thousands):

Amount of gain (loss), net, recognized in Comprehensive Income

Amount of (loss) gain, net, recognized in Comprehensive Income

2025 2024 2023

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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.

The bank syndicate for the Credit Facility was then 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.

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We incurred fees of approximately $ 0.5 million in connection with issuing Term Loan B.

As of December 31, 2024, there was $ 40.0 million outstanding under Term Loan B.

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.

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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 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 unsecured term loan (“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, National Association (“PNC Bank”), Webster Bank, National Association (“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 December 31, 2025, the maximum additional amount we could draw under the Credit Facility was $ 62.8 million.

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The amount outstanding under the Credit Facility approximates fair value as of December 31, 2025.

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 amount outstanding approximates fair value as of December 31, 2024.

Unsecured Term Loan D

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.

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

Senior Unsecured Notes

On December 18, 2024, we and the Operating Partnership entered into a Note Purchase Agreement with the institutional investors named therein, to issue an aggregate $ 75.0 million in senior unsecured notes in a private placement, at a fixed interest rate of 6.47 % and a maturity date of December 18, 2029 (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 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 in senior unsecured notes in a private placement, at a fixed interest rate of 5.99 % and a maturity date of December 15, 2030 (the “2030 Notes”).

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

The fair value of the 2029 Notes outstanding as of December 31, 2025 was $ 75.8 million, as compared to the carrying value stated above of $ 74.1 million.

The fair value of the 2030 Notes outstanding as of December 31, 2025 was $ 84.5 million, as compared to the carrying value stated above of $ 84.1 million.

The fair value is calculated based on a discounted cash flow analysis, using management’s estimate of market interest rates on long-term debt with comparable terms and loan to value ratios.

The fair value was calculated using Level 3 inputs of the hierarchy established by ASC 820, “Fair Value Measurements and Disclosures.”

Commitments and Contingencies

Ground Leases

We are obligated as lessee under three ground leases.

We are obligated as lessee under four ground leases.

Future minimum rental payments due under the terms of these leases as of December 31, 2025, are as follows (dollars in thousands):

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Present value of lease payments $ 3,816

Year Future Lease Payments Due Under Finance Leases

Thereafter 7,098

Total anticipated lease payments $ 7,982

amount representing interest ( 5,018 )

Present value of lease payments $ 2,964

Rental expense incurred for properties with ground lease obligations was $ 0.5 million, $ 0.3 million, and $ 0.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Our ground leases are treated as operating leases and rental expenses are reflected in property operating expenses on the consolidated statements of operations and comprehensive income.

Three of our ground leases are treated as operating leases and rental expenses are reflected in property operating expenses on the consolidated statements of operations and comprehensive income.

One of our ground leases is treated as a finance lease and rental expense is reflected in interest expenses on the consolidated statements of operations and comprehensive income.

Our ground leases have a weighted average remaining lease term of 22.6 years and weighted average discount rate of 5.80 %.

Letters of Credit

As of December 31, 2024, there were no outstanding letters of credit.

As of December 31, 2025, there were $ 2.1 million outstanding letters of credit.

Equity and Mezzanine Equity

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(“KeyBanc”), and Fifth Third (collectively the “Common Stock Sales Agents”).

In connection with the 2023 Common Stock Sales Agreement, we filed prospectus supplements dated March 3, 2023 and March 7, 2023, to the prospectus dated November 23, 2022, with the SEC, for the offer and sale of an aggregate offering amount of $ 250.0 million of common stock.

In connection with the 2023 Common Stock Sales Agreement, we filed prospectus supplements with the SEC dated March 3, 2023 and March 7, 2023, to the prospectus dated November 23, 2022, for the offer and sale of an aggregate offering amount of $ 250.0 million of common stock.

During the year ended December 31, 2025, we did not sell any shares of common stock under the 2023 Common Stock Sales Agreement.

On March 26, 2024, we entered into Amendment No.

1 to the 2023 Common Stock Sales Agreement (the “2024 Common Stock Sales Agreement”).

1 to the 2023 Common Stock Sales Agreement (as amended from time to time, the “2024 Common Stock Sales Agreement”).

The amendment permitted shares of common stock to be issued pursuant to the 2024 Common Stock Sales Agreement under the Company’s Registration Statement on Form S-3 (File No.

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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.

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.

Common Stock Buyback Program

During the year ended December 31, 2023, we repurchased $ 1.0 million worth of our common stock through our common stock repurchase program.

We did not repurchase any stock during the years ended December 31, 2025 and 2024.

Mezzanine Equity

Our 6.625 % Series E Cumulative Redeemable Preferred Stock (“Series E Preferred Stock”) and 6.00 % Series G Cumulative Redeemable Preferred Stock (“Series G Preferred Stock”), are classified as mezzanine equity in our consolidated balance sheet because both are redeemable at the option of the stockholder upon a change of control of greater than 50 % in accordance with ASC 480-10-S99 “Distinguishing Liabilities from Equity,” which requires mezzanine equity classification for preferred stock issuances with redemption features which are outside of the control of the issuer.

Our 6.625 % Series E Cumulative Redeemable Preferred Stock (“Series E Preferred Stock”) and our 6.00 % Series G Cumulative Redeemable Preferred Stock (“Series G Preferred Stock”), are classified as mezzanine equity in our consolidated balance sheet because both are redeemable at the option of the stockholder upon a change of control of greater than 50 % in accordance with ASC 480-10-S99 “Distinguishing Liabilities from Equity,” which requires mezzanine equity classification for preferred stock issuances with redemption features which are outside of the control of the issuer.

A change in control of the Company, outside of our control, is only possible if a tender offer is accepted by over 90 % of our stockholders.

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We will periodically evaluate the likelihood that a change of control or delisting event of greater than 50 % will take place, and if we deem this probable, we would adjust the Series E Preferred Stock and Series G Preferred Stock presented in mezzanine equity to their redemption value, with the offset to gain (loss) on extinguishment.

We currently believe the likelihood of a change of control or delisting event of greater than 50 % is remote.

We currently believe the likelihood of a change of control of greater than 50 %, or a delisting event, is remote.

Series E Preferred Stock ATM Program

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

Amendments to Operating Partnership Agreement

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 “Second 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 Second 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.

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

On June 23, 2021, the Operating Partnership adopted the Third Amendment to its Second Amended and Restated Agreement of Limited Partnership, including Exhibit SGP thereto (collectively, the “Third Amendment”), establishing the rights, privileges, and preferences of 6.00 % Series G Cumulative Redeemable Preferred Units, a newly-designated class of limited partnership interests (the “Series G Term Preferred Units”).

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.

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.

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.

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.

As of December 31, 2025 and 2024, there were 39,474 and 39,474 outstanding OP Units held by Non-controlling OP Unitholders, respectively.

Earnings (loss) per Share of Common Stock

The following tables set forth the computation of basic and diluted earnings (loss) per share of common stock for the years ended December 31, 2025, 2024 and 2023, respectively.

The OP Units held by Non-controlling OP Unitholders (which may be redeemed for shares of common stock) have been excluded from the diluted earnings (loss) per share calculation, as these would be anti-dilutive.

Net income (loss) figures are presented net of such non-controlling interests in the earnings (loss) per share calculation.

We computed basic earnings (loss) per share for the years ended December 31, 2025, 2024 and 2023, respectively, using the weighted average number of shares outstanding during the periods.

The diluted earnings (loss) per share for the years ended December 31, 2025, 2024 and 2023, would reflect additional shares of common stock related to our convertible Senior Common Stock, if the effect of conversion would be dilutive, that would have been outstanding if such dilutive potential shares of common stock had been issued, as well as an adjustment to net income (loss) available (attributable) to common stockholders as applicable to common stockholders that would result from their assumed issuance (dollars in thousands, except per share amounts).

For the year ended December 31,

2025 2024 2023

Calculation of basic and diluted earnings per share of common stock:

Net income (loss) available (attributable) to common stockholders $ 6,591 $ 11,124 $ ( 7,738 )

Denominator for basic and diluted weighted average shares of common stock (1) (2) 46,538,232 41,766,263 39,943,167

Basic and diluted earnings per share of common stock $ 0.14 $ 0.27 $ ( 0.19 )

(1) The weighted average number of OP Units held by Non-controlling OP Unitholders was 39,474 , 157,160 , and 382,563 for the years ended December 31, 2025, 2024, and 2023, respectively.

(2) We excluded convertible shares of Senior Common Stock of 322,315 , 330,456 and 345,132 from the calculation of diluted earnings (loss) per share for the years ended December 31, 2025, 2024 and 2023, respectively, because these shares were anti-dilutive.

Subsequent Events

17 unchanged sentences

March April 3, 2026 0.0875

Equity Activity

Subsequent to December 31, 2024 and through February 18, 2025, we raised $ 3.3 million in net proceeds from the sale of 205,651 shares of common stock under our 2024 Common Stock Sales Agreement and we raised $ 0.1 million in net proceeds from the sale of 6,500 shares of Series F Preferred Stock.

Sale Activity

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.

GLADSTONE COMMERCIAL CORPORATION

91 unchanged sentences

Industrial Building 1,058 258 5,861 6 258 5,867 6,125 2,761 3,364 1990 12/15/2010

Hickory, North Carolina (3)

Office Building — 1,163 6,605 357 1,163 6,962 8,125 3,788 4,337 2008 4/4/2011

Springfield, Missouri (3)

57 unchanged sentences

Maitland, Florida

Office Building 6,473 2,095 9,339 9 2,095 9,348 11,443 3,274 8,169 1999 7/31/2017

Columbus, Ohio (3)

Initial Cost Total Cost

10 unchanged sentences

Office Building — 1,926 11,410 875 1,925 12,286 14,211 4,251 9,960 2007 12/1/2017

Columbus, Ohio (3)

Office Building — 1,926 11,410 332 1,925 11,743 13,668 3,707 9,961 2007 12/1/2017

Salt Lake City, Utah (3)

20 unchanged sentences

Industrial Building — 316 2,355 — 316 2,355 2,671 604 2,067 2005 4/30/2019

Tifton, Georgia

Industrial Building 7,260 — 15,190 ( 15,190 ) — — — — — 1995 / 2003

Denton, Texas (3)

39 unchanged sentences

Pittsburgh, Pennsylvania

Industrial Building 5,982 1,422 10,094 567 1,422 10,661 12,083 2,355 9,728 1994 12/21/2020

Findlay, Ohio

Industrial Building 4,742 258 8,847 — 258 8,847 9,105 1,561 7,544 1992 / 2008

Baytown, Texas (3)

Initial Cost Total Cost

10 unchanged sentences

Industrial Building — 1,604 5,533 3 1,607 5,533 7,140 1,224 5,916 2018 6/17/2021

Findlay, Ohio

Industrial Building 4,907 258 8,847 — 258 8,847 9,105 1,245 7,860 1992 / 2008

Baytown, Texas (3)

Industrial Building — 1,604 5,533 3 1,607 5,533 7,140 954 6,186 2018 6/17/2021

Pacific, Missouri (3)

18 unchanged sentences

Industrial Building — 346 5,758 — 346 5,758 6,104 869 5,235 2014 2/24/2022

Oklahoma City, Oklahoma (3)

Industrial Building — 470 4,688 ( 1,779 ) 289 3,090 3,379 534 2,845 1999 / 2004

Cleveland, Ohio

39 unchanged sentences

Warfordsburg, Pennsylvania (3)

Industrial Building — 1 6 — 1 6 7 — 7 1991 / 1999

Midland, Texas (3)

Industrial Building — 525 7,772 — 525 7,772 8,297 322 7,975 2024 8/29/2024

Clair, Missouri (3)

Industrial Building — 1,168 3,493 5,488 1,169 8,980 10,149 130 10,019 2014 11/15/2024

Houston, Texas (3)

Initial Cost Total Cost

10 unchanged sentences

Industrial Building — 256 926 — 256 926 1,182 28 1,154 2009 / 2023

Midland, Texas (3)

Houston, Texas (3)

Industrial Building — 239 866 — 239 866 1,105 26 1,079 2009 / 2023

Clair, Missouri (3)

Houston, Texas (3)

Industrial Building — 2,133 7,721 ( 1 ) 2,132 7,721 9,853 235 9,618 2009 / 2023

Houston, Texas (3)

Industrial Building — 2,580 9,342 — 2,580 9,342 11,922 284 11,638 2009 / 2023

Houston, Texas (3)

Industrial Building — 362 1,310 — 362 1,310 1,672 40 1,632 2009 / 2023

Dallas, Texas (3)

Industrial Building — — 39,195 — — 39,195 39,195 813 38,382 2021 3/28/2025

Germantown, Wisconsin (3)

Industrial Building — 3,103 48,268 1 3,104 48,268 51,372 848 50,524 2022 / 2024

Harrison Township, Missouri (3)

Industrial Building — 91 492 29 91 521 612 11 601 1970 / 1994

Harrison Township, Missouri (3)

Industrial Building — 1,303 7,012 400 1,302 7,413 8,715 162 8,553 1970 / 1994

Harrison Township, Missouri (3)

Industrial Building — 573 3,087 176 573 3,263 3,836 71 3,765 1970 / 1994

Cartersville, Georgia (3)

Industrial Building — 805 9,970 35 804 10,006 10,810 95 10,715 1983 9/30/2025

Ossian, Indiana (3)

Industrial Building — 519 15,006 1 520 15,006 15,526 146 15,380 1995 9/30/2025

Ligonier, Indiana (3)

Industrial Building — 511 8,667 ( 1 ) 510 8,667 9,177 88 9,089 1992 9/30/2025

Caro, Michigan (3)

Industrial Building — 94 4,124 24 95 4,147 4,242 41 4,201 1955 / 1980

Caro, Michigan (3)

Industrial Building — 23 991 4 23 995 1,018 10 1,008 1955 / 1980

Caro, Michigan (3)

Industrial Building — 6 251 1 6 252 258 3 255 1955 / 1980

Caro, Michigan (3)

Industrial Building — 3 133 1 3 134 137 1 136 1955 / 1980

Chesterfield, Michigan (3)

Industrial Building — 416 3,681 — 415 3,682 4,097 34 4,063 1987 / 2013

Cass City, Michigan (3)

Industrial Building — 90 1,550 8 90 1,558 1,648 18 1,630 1960 / 1995

/ 2005 / 2022

$ 251,578 $ 152,190 $ 1,115,018 $ 135,432 $ 152,453 $ 1,250,187 $ 1,402,640 $ 361,280 $ 1,041,360

(1) The aggregate cost for land and building improvements for federal income tax purposes is the same as the total gross cost of land, building improvements and acquisition costs capitalized for asset acquisitions under ASC 360, which is $ 1,402.6 million.

24 unchanged sentences

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 8. Financial Statements and Supplementary Data