1 unchanged sentence
Market risk is the exposure to loss resulting from changes in interest rates, foreign currency exchange rates, and equity prices.
−Removed: The primary market risks that we are exposed to are interest rate risk and foreign currency exchange risk.
+Added: The primary market risk that we are exposed to is interest rate risk.
We are also exposed to further market risk as a result of tenant concentrations in certain industries and/or geographic regions, since adverse market factors can affect the ability of tenants in a particular industry/region to meet their respective lease obligations.
−Removed: In order to manage this risk, we view our collective tenant roster as a portfolio and we attempt to diversify such portfolio so that we are not overexposed to a particular industry or geographic region.
+Added: In order to manage this risk, we view our collective tenant roster as a portfolio and monitor its diversification.
Interest Rate Risk
9 unchanged sentences
However, interest rate changes will affect the fair value of fixed-rate instruments.
−Removed: Movements in interest rates on variable rate debt could change future earnings and cash flows, but not significantly affect the fair value of the debt.
−Removed: However, changes in required risk premiums would result in changes in the fair value of variable rate instruments.
−Removed: We have entered into, and may continue to enter into, interest rate cap agreements with counterparties related to certain of our variable-rate debt.
+Added: At December 31, 2025, fixed-rate debt comprises 100% of our debt.
+Added: We have entered into, and may continue to enter into, interest rate cap agreements with counterparties related to variable-rate debt.
See Note 9 for additional information on our interest rate caps.
−Removed: At December 31, 2024, fixed-rate debt comprises 76% of our debt and variable-rate debt comprises 24%.
Our debt obligations are more fully described in Note 10 and Liquidity and Capital Resources — Summary of Financing in Item 7 above.
1 unchanged sentence
2026 2027 2028 2029 2030 Total Fair Value
−Removed: Fixed-rate debt (a)
−Removed: $ 66,092 $ 5,882 $ — $ 61,141 $ — $ 133,115 $ 128,237
−Removed: Variable-rate debt (a)
−Removed: $ 38,867 $ — $ — $ — $ — $ 38,867 $ 25,158
−Removed: (a) Amounts are based on the exchange rate at December 31, 2024, as applicable.
−Removed: Annual interest expense on our variable-rate debt at December 31, 2024 would increase or decrease by $0.4 million, for each respective 1% change in annual interest rates.
−Removed: Net Lease Office Properties 2024 10-K – 37
+Added: Fixed-rate debt $ 21,900 $ — $ — $ — $ — $ 21,900 $ 21,900
Foreign Currency Exchange Rate Risk
−Removed: We own international investments in Europe, and as a result are subject to risk from the effects of exchange rate movements in the Norwegian krone and euro, which may affect future costs and cash flows.
−Removed: We have obtained, and may in the future obtain, non-recourse mortgage financing in the local currency.
−Removed: Volatile market conditions arising from macroeconomic factors, may result in significant fluctuations in foreign currency exchange rates.
−Removed: To the extent that currency fluctuations increase or decrease rental revenues, as translated to U.S.
−Removed: dollars, the change in debt service (comprised of principal and interest, excluding balloon payments), as translated to U.S.
−Removed: dollars, will partially offset the effect of fluctuations in revenue and, to some extent, mitigate the risk from changes in foreign currency exchange rates.
−Removed: We estimate that, for a 1% increase or decrease in the exchange rate between the Norwegian krone or euro and the U.S.
−Removed: dollar, there would be a corresponding change in the projected estimated cash flow (scheduled future rental revenues, net of scheduled future debt service payments for the next 12 months) for our consolidated foreign operations at December 31, 2024 of $0.1 million for both currencies.
+Added: We sold all of our international investments during the year ended December 31, 2025 ( Note 3 , Note 1 5 ).
Concentration of Credit Risk
10 unchanged sentences
We believe that the credit risk of our portfolio is reduced by the high quality and diversity of our existing tenant base, reviews of prospective tenants’ risk profiles prior to lease execution and consistent monitoring of our portfolio to identify potential problem tenants.
+Added: Net Lease Office Properties 2025 10-K – 35
For the year ended December 31, 2025, our consolidated portfolio had the following significant characteristics in excess of 10%, based on the percentage of our consolidated total revenues:
−Removed: • 94% related to domestic operations, which included concentrations of 36% and 19% in Texas and Minnesota, respectively.
+Added: • 27% related to our tenant KBR, 13% related to our tenant Master Lock (including a lease termination fee of $13.0 million received during the year ended December 31, 2025 ( Note 5 )), and 12% related to our tenant JPMorgan Chase;
+Added: we sold the KBR property in January 2026 ( Note 17 ) and we sold the properties leased to Master Lock and JPMorgan Chase during 2025 ( Note 15 );
+Added: • 97% related to domestic operations, which included concentrations of 41%, 13%, and 11% in Texas, Wisconsin, and Minnesota, respectively.
Net Lease Office Properties 2025 10-K – 36
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.