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Item 2. Management’s Discussion and Analysis

2026-07-22 compared with 2026-04-20 · 185 added, 96 removed, 270 unchanged (51% of the section changed)

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We expressly disclaim any obligation or undertaking to update or revise any forward-looking statement contained herein, to reflect any change in our expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except to the extent otherwise required by law.

References to “we,” “our,” “us,” and “the Company” refer to NETSTREIT Corp., a Maryland corporation, together with our consolidated subsidiaries, including NETSTREIT, L.P., a Delaware limited partnership (the “Operating Partnership”) and NETSTREIT GP, LLC, a Delaware limited liability company and the sole general partner of the Operating Partnership.

Business Overview

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We also invest in property developments and mortgage loans secured by real estate.

As of March 31, 2026, we owned or had investments in 808 properties diversified by tenant, industry, and geography, comprising 138 different tenants across 28 retail sectors in 46 states.

This includes four property developments where rent has not yet commenced.

As of June 30, 2026, we owned or had investments in 864 properties diversified by tenant, industry, and geography, comprising 156 different tenants across 28 retail sectors in 46 states.

This includes five property developments where rent has not yet commenced.

We focus on tenants in industries where we believe a physical location is critical to the generation of sales and profits, with a focus on necessity goods and essential services in the retail sector, including grocers, convenience stores, discount stores, home improvement, quick-service restaurants, general retail, and auto parts, all of which we refer to as defensive retail industries.

As of March 31, 2026, our investments generated ABR 1 of $214.2 million.

As of June 30, 2026, our investments generated ABR 1 of $231.4 million.

Approximately 41% of our ABR is from investment grade 2 credit rated tenants and an additional 16% of our ABR is derived from tenants with an investment grade profile 3 .

Our portfolio was 99.9% occupied (excluding four properties under development) and, excluding mortgage loans receivable, had a weighted average remaining lease term (“WALT”) of 10.2 years.

February 2026 Follow-On Offering

In February 2026, we completed a registered public offering of 12,627,000 shares of our common stock at a public offering price of $19.00 per share, including the full exercise of the underwriters’ option to purchase additional shares.

In connection with the offering, we entered into forward sale agreements for 12,627,000 shares of our common stock.

We did not initially receive any proceeds from the sale of shares of common stock by the forward purchasers.

As of March 31, 2026, 12,627,000 shares remain unsettled under the February 2026 forward sale agreements.

We expect to physically settle the forward sale agreements (by delivery of shares of common stock) and receive proceeds from the sale of those shares upon one or more forward settlement dates, which shall occur no later than February 12, 2027.

( 1 ) Annualized base rent (“ABR”) is annualized base rent for all leases that commenced and annualized cash interest for all executed mortgage loans as of March 31, 2026.

Our portfolio was 100.0% occupied (excluding five properties under development) and, excluding mortgage loans receivable, had a weighted average remaining lease term (“WALT”) of 10.0 years.

1 Annualized base rent (“ABR”) is annualized base rent for all leases that commenced and annualized cash interest for all executed mortgage loans as of June 30, 2026.

2 We define “investment grade” tenants as tenants, or tenants that are subsidiaries of a parent entity, with a credit rating of BBB- (S&P/Fitch), Baa3 (Moody’s), or NAIC2 (National Association of Insurance Commissioners) or higher.

3 We define “investment grade profile” tenants as tenants that have investment grade credit metrics (more than $1.0 billion in annual sales and a debt to adjusted EBITDA ratio of less than 2.0x), but do not carry a published rating from S&P, Fitch, Moody’s, or NAIC.

On April 21, 2026, we entered into a $400.0 million at-the-market equity program (the “2026 ATM Program”) through which, from time to time, we may sell shares of our common stock in registered transactions.

Effective April 21, 2026, in connection with the establishment of the new at-the-market offering program, the existing $300.0 million at-the-market equity program established in August 2024 (the “2024 ATM Program”) was terminated.

During the six months ended June 30, 2026, we entered into forward sale agreements with respect to an aggregate 8,697,206 shares of common stock under the 2026 ATM Program at a weighted-average price of $20.51 per share.

Additionally, during the six months ended June 30, 2026, we entered into forward sale agreements with respect to an aggregate 4,264,015 shares of common stock under the 2024 ATM Program at a weighted-average price of $18.86 per share.

As of June 30, 2026, 21,475,108 shares remain unsettled under forward sale agreements associated with our existing $300.0 million at-the-market equity program (the “2023 ATM Program”), 2024 ATM Program, and 2026 ATM Program.

We may physically settle the forward sale agreements (by delivery of shares of common stock) and receive proceeds from the sale of those shares on one or more forward settlement dates, which shall occur no later than the stated maturity dates ranging from September 2026 to June 2027, unless the parties mutually agree to extend such dates.

As of June 30, 2026, the remaining availability under the 2026 ATM Program was $221.6 million.

Settlement of Forward Shares Under the July 2025 Follow-On Offering

In July 2025, we completed a registered public offering of 12,420,000 shares of common stock at a public offering price of $17.70 per share.

In connection with the offering, we entered into forward sale agreements for 12,420,000 shares of our common stock.

We did not initially receive any proceeds from the sale of shares of common stock by the forward purchasers.

On June 29, 2026, we physically settled 4,264,947 shares of common stock at a weighted-average price of $16.60 per share in accordance with the forward sale agreements.

We received net proceeds from the settlement of $70.7 million, net of underwriting discounts and offering costs of $4.8 million.

As of June 30, 2026, we had fully settled the July 2025 forward sale agreements.

Settlement of Forward Shares Under the January 2024 Follow-On Offering

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We received net proceeds from the settlement of $67.8 million, net of underwriting discounts and offering costs of $4.2 million.

As of March 31, 2026, 4,840,000 shares remain unsettled under the January 2024 forward sale agreements.

During the three months ended March 31, 2026, we entered into forward sale agreements with respect to an aggregate 3,956,031 shares of common stock under the existing $300.0 million at-the-market equity program established in August 2024 (the “2024 ATM Program”) at a weighted-average price of $18.81 per share.

As of March 31, 2026, 12,469,918 shares remain unsettled under forward sale agreements associated with our existing $300.0 million at-the-market equity program (the “2023 ATM Program”) and the 2024 ATM Program.

As of March 31, 2026, the remaining availability under the 2024 ATM Program was $49.9 million.

2032 Term Loan Draw

Subject to the terms of the term loan agreement agented by PNC Bank, National Association (the “PNC Term Loan Agreement”), we drew an additional $50.0 million under the $250.0 million senior unsecured term loan (the “2032 Term Loan”) on January 2, 2026, bringing the total outstanding principal amount to $150.0 million.

As of June 30, 2026, 4,840,000 shares remain unsettled under the January 2024 forward sale agreements.

February 2026 Follow-On Offering

In connection with the offering, we entered into forward sale agreements for 12,627,000 shares of our common stock.

We did not initially receive any proceeds from the sale of shares of common stock by the forward purchasers.

As of June 30, 2026, 12,627,000 shares remain unsettled under the February 2026 forward sale agreements.

2032 Term Loan Draws

Subject to the terms of the term loan agreement agented by PNC Bank, National Association (the “PNC Term Loan Agreement”), we drew $50.0 million under the $250.0 million senior unsecured term loan (the “2032 Term Loan”) on January 2, 2026, and an additional $50.0 million on April 1, 2026, bringing the total outstanding principal amount to $200.0 million.

The $200.0 million outstanding under the 2032 Term Loan is hedged with an all-in fixed interest rate of 4.67%.

We have $50.0 million remaining under the PNC Term Loan Agreement delayed draw term loan commitment.

Truist Credit Agreement Amendment

On May 29, 2026, we amended our existing Credit Agreement, dated as of July 3, 2023, by and among the Operating Partnership, the Company, the financial institutions party thereto, as lenders, and Truist Bank, as Administrative Agent to, among other things, reduce the applicable margin spread related to our $250.0 million sustainability-linked senior unsecured term loan (the “2029 Term Loan”).

Additionally, we exercised our first extension option and extended the 2029 Term Loan one year through July 3, 2027.

Results of Operations

We continued to grow our assets held for investment during the three months ended March 31, 2026 through the acquisition of properties, property developments, and investment in mortgage loans receivable, with an underwritten weighted-average cash yield of approximately 7.5%.

This growth was financed through the $50.0 million draw under the 2032 Term Loan, settlement of shares of common stock through our January 2024 Follow-On Offering in an amount of $67.8 million, the usage of cash balances as a result of borrowings on our senior unsecured revolving credit facility (the “Revolver”), the usage of restricted cash balances as a result of tax-free exchanges under Section 1031 of the Internal Revenue Code of 1986, and cash flows from operations during the three months ended March 31, 2026.

During the three months ended March 31, 2026, we acquired 56 properties for a total purchase price of $234.0 million, inclusive of $3.0 million of capitalized acquisition costs.

We continued to grow our assets held for investment during the six months ended June 30, 2026 through the acquisition of properties, property developments, and investment in mortgage loans receivable, with an underwritten weighted-average cash yield of approximately 7.4%.

This growth was financed through the two $50.0 million draws under the 2032 Term Loan, settlement of shares of common stock through our July 2025 and January 2024 follow-on offering forward sale agreements of $70.7 million and $67.8 million, respectively, borrowings on our senior unsecured revolving credit facility (the “Revolver”), the usage of restricted cash balances as a result of tax-free exchanges under Section 1031 of the Internal Revenue Code of 1986, and cash flows from operations during the six months ended June 30, 2026.

During the three months ended June 30, 2026, we acquired 79 properties for a total purchase price of $252.7 million, inclusive of $3.5 million of capitalized acquisition costs.

The acquisitions were all accounted for as asset acquisitions.

These properties are located in 23 states with a WALT of approximately 9.8 years.

As of March 31, 2026, we had four property developments under construction, which are expected to be substantially completed with rent commencing at various points throughout 2026 and early 2027.

During the three months ended March 31, 2026, we invested $5.4 million in property developments, including the land acquisition of one new development with an initial purchase price of $2.3 million.

The purchase price, including acquisition costs, and subsequent development are included in property under development in the accompanying condensed consolidated balance sheets as of March 31, 2026.

During the three months ended March 31, 2026, we sold five properties for a total sales price, net of disposal costs, of $10.4 million, recognizing a net gain of $0.1 million.

During the six months ended June 30, 2026, we acquired 135 properties for a total purchase price of $486.7 million, inclusive of $6.6 million of capitalized acquisition costs.

The acquisitions were all accounted for as asset acquisitions.

These properties are located in 29 states with a WALT of approximately 11.9 years.

As of June 30, 2026, we had five property developments under construction.

During the three months ended June 30, 2026, we invested $7.6 million in property developments, including the land acquisition of two new developments with an initial purchase price of $1.1 million.

During the six months ended June 30, 2026, we invested $13.0 million in property developments, including the land acquisition of three new developments with an initial purchase price of $3.4 million.

During the six months ended June 30, 2026, we completed development on one project and reclassified approximately $5.0 million from property under development to land, buildings and improvements, and other assets (leasing commissions) in the accompanying condensed consolidated balance sheets.

Rent commenced for the completed development in the second quarter of 2026.

The remaining five developments are expected to be substantially completed with rent commencing at various points throughout 2026 and early 2027.

The purchase price, including acquisition costs, and subsequent development are included in property under development in the accompanying condensed consolidated balance sheets as of June 30, 2026.

During the three months ended June 30, 2026, we sold 16 properties for a total sales price, net of disposal costs, of $45.1 million, recognizing a net gain of $1.7 million on the sales.

During the six months ended June 30, 2026, we sold 21 properties for a total sales price, net of disposal costs, of $55.5 million, recognizing a net gain of $1.8 million on the sales.

Investment in Mortgage Loans Receivable

During the three months ended March 31, 2026, we invested an additional $5.1 million in fully collateralized mortgage loans receivable with stated interest rates ranging from 9.50% to 9.75%.

In addition, during the three months ended March 31, 2026, we collected $11.2 million in principal on our mortgage loans receivable.

We sold one mortgage loan receivable at a discount in an effort to manage tenant exposure, recognizing non-credit related provisions for impairment of $0.6 million for the three months ended March 31, 2026.

During the three and six months ended June 30, 2026, we invested an additional $40.8 million and $45.9 million, respectively, in fully collateralized mortgage loans receivable with stated interest rates ranging from 8.21% to 9.75%.

This is inclusive of $6.0 million provided through seller financing transactions during the six months ended June 30, 2026.

In addition, during the three and six months ended June 30, 2026, we collected $20.1 million and $31.3 million, respectively, in principal on our mortgage loans receivable.

This is inclusive of $17.3 million of mortgage loans receivable settled in exchange for acquisition of real estate during the six months ended June 30, 2026.

In addition, we sold one mortgage loan receivable at a discount in an effort to manage tenant exposure, recognizing non-credit related provisions for impairment of $0.6 million for the six months ended June 30, 2026.

See discussion of our mortgage loans receivable portfolio included in “Note 4 – Real Estate Investments” of our condensed consolidated financial statements, included in “Item 1 – Financial Statements (unaudited)”.

Three Months Ended March 31, 2026 Compared with Three Months Ended March 31, 2025

Three Months Ended June 30, 2026 Compared with the Three Months Ended June 30, 2025

The following table sets forth our operating results for the periods indicated (in thousands):

Three Months Ended

Three Months Ended June 30,

Rental revenue (including reimbursable) $ 57,822 $ 45,158

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Gain on sales of real estate, net 1,662 3,533

Other income, net 567 81

Total other expense, net (13,325) (9,024)

Net income before income taxes 6,389 3,302

Income tax expense (78) (13)

Net income $ 6,311 $ 3,289

Revenue for the three months ended June 30, 2026 increased by $13.0 million to $61.3 million from $48.3 million for the three months ended June 30, 2025, which is primarily attributed to an increase in the number of our operating leases.

The increase includes additional cash rental receipts of $11.2 million, an increase of $1.1 million in straight-line rental revenue, combined net increases of property expense reimbursements of $0.9 million, and an increase in other revenue of $0.6 million related to lease termination fees, offset by a net increase of $0.2 million in reserves for uncollectible amounts, a decrease in interest income on mortgage loans receivable of $0.2 million and other combined net decreases of $0.4 million.

Total operating expenses.

Total operating expenses increased by $5.6 million to $41.6 million for the three months ended June 30, 2026 as compared to $36.0 million for the three months ended June 30, 2025.

The increase is primarily attributed to an increase in the number of operating properties, with the most significant increases being depreciation and amortization expense and property expenses.

Total operating expenses include the following:

• Property expenses.

Property expenses increased by $1.2 million to $5.7 million for the three months ended June 30, 2026 from $4.5 million for the three months ended June 30, 2025.

The increase is primarily attributed to an increase in the number of operating properties, including combined net increases of reimbursable property expenses of $1.0 million, of which $0.7 million were related to reimbursable property taxes and $0.2 million were related to reimbursable common area maintenance, and an increase of $0.2 million of non-reimbursable property expenses.

• General and administrative expenses.

General and administrative expenses increased by $0.3 million to $5.8 million for the three months ended June 30, 2026 from $5.5 million for the three months ended June 30, 2025.

The increases within general and administrative expense were primarily related to an increase of $0.2 million of stock-based compensation and an increase of $0.2 million of payroll expense.

• Depreciation and amortization.

Depreciation and amortization expense increased by $4.3 million to $25.8 million for the three months ended June 30, 2026 from $21.5 million for the three months ended June 30, 2025.

The increase in depreciation and amortization is proportionate to the increase in the size of the portfolio over the comparable period with associated increases primarily in building depreciation expense of $2.5 million, building improvements depreciation expense of $0.9 million, and in-place lease amortization expense of $0.9 million.

• Provisions for impairment.

For the three months ended June 30, 2026, we recorded provisions for impairment of $4.2 million on ten properties, all of which were either previously classified as held-for-sale, newly classified as held-for-sale, or disposed during the three months ended June 30, 2026.

For the three months ended June 30, 2025, we recorded provisions for impairment of $4.4 million on nine properties, all of which were classified as held-for-sale or disposed during the three months ended June 30, 2025.

These disposals relate to management’s continuous assessment of our portfolio in an effort to improve returns and manage risk exposure.

Interest expense, net.

Interest expense increased by $3.0 million to $15.6 million for the three months ended June 30, 2026 from $12.6 million for the three months ended June 30, 2025.

The increase is primarily attributed to an increase of $2.4 million of interest incurred on our 2032 Term Loan, an increase of $2.2 million of interest incurred on our $200.0 million senior unsecured term loan (the “2031 Term Loan”), and in increase of $0.2 million in loan fee amortization related to the 2031 Term Loan and 2032 Term Loan.

The increase was partially offset by $1.3 million of reduced interest incurred on our Revolver, primarily due to a decrease in average borrowings outstanding during the respective periods, and collectively, $0.6 million of reduced interest incurred on our $200.0 million senior unsecured term loan (the “2028 Term Loan”), our 2029 Term Loan, our $175.0 million senior unsecured term loan (the “2030 Term Loan A”), and our $175.0 million senior unsecured term loan (the “2030 Term Loan B”), primarily related to the interest rate reduction as a result of receiving a credit rating at the end of 2025.

Gain on sales of real estate, net.

Net gain on sales of real estate decreased by $1.8 million to $1.7 million for the three months ended June 30, 2026 from $3.5 million for the three months ended June 30, 2025.

For the three months ended June 30, 2026, 16 properties were sold for a sales price, net of disposal costs, of $45.1 million.

For the three months ended June 30, 2025, 20 properties were sold for a sales price, net of disposal costs, of $55.6 million.

Other income, net.

Other income, net increased by $0.5 million to $0.6 million for the three months ended June 30, 2026 from $0.1 million for the three months ended June 30, 2025.

The increase is primarily attributed to a $0.4 million non-cash increase in our mortgage loans receivable related to the recovery of development incentive funds and $0.1 million of easement income associated with third-party construction projects.

Net income increased by $3.0 million to $6.3 million for the three months ended June 30, 2026 from $3.3 million for the three months ended June 30, 2025.

Net income increased primarily due to increases in additional rental revenues, primarily due to the growth in the size of our real estate investment portfolio.

The increase in net income is partially offset by increases in depreciation and amortization expense, interest expense, property expense, and a decrease in gain on sales of real estate.

Six Months Ended June 30, 2026 Compared with the Six Months Ended June 30, 2025

The following table sets forth our operating results for the periods indicated (in thousands):

Six Months Ended June 30,

Rental revenue (including reimbursable) $ 111,849 $ 87,748

Interest income on loans receivable 5,941 6,203

Other revenue 556 245

Total revenues $ 118,346 $ 94,196

Operating expenses

Property $ 11,121 $ 9,287

General and administrative 11,596 10,644

Depreciation and amortization 50,270 42,429

Provisions for impairment 6,261 8,038

Transaction costs (54) 120

Total operating expenses $ 79,194 $ 70,518

Other (expense) income

Interest expense, net $ (29,820) $ (24,098)

Gain on sales of real estate, net 1,781 5,608

Loss on debt extinguishment — (46)

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Net income $ 12,022 $ 4,989

Revenue for the three months ended March 31, 2026 increased by $11.2 million to $57.1 million from $45.9 million for the three months ended March 31, 2025, which is primarily attributed to an increase in the number of our operating leases.

The increase includes additional cash rental receipts of $9.5 million, an increase of $1.2 million in straight-line rental revenue, combined net increases of property expense reimbursements of $0.5 million, and a net decrease of $0.3 million in reserves for uncollectible amounts, offset by a decrease in other revenue of $0.2 million related to a lease termination fee during the three months ended March 31, 2025 and other combined net decreases of $0.1 million.

Revenue for the six months ended June 30, 2026 increased by $24.1 million to $118.3 million from $94.2 million for the six months ended June 30, 2025, which is primarily attributed to an increase in the number of our operating leases and properties securing mortgage loans.

The increase includes additional cash rental receipts of $20.8 million, an increase of $2.3 million in straight-line rental revenue, combined net increases of property expense reimbursements of $1.4 million, an increase in other revenue of $0.3 million related to additional lease termination fees, and of a net decrease of $0.1 million in reserves for uncollectible amounts, offset by a decrease in interest income on mortgage loans receivable of $0.3 million, a decrease of $0.2 million related to intangible lease-related adjustments, and other combined net decreases of $0.2 million.

Total operating expenses.

Total expenses increased by $3.0 million to $37.6 million for the three months ended March 31, 2026 as compared to $34.6 million for the three months ended March 31, 2025.

The increase is primarily attributed to an increase in the number of operating properties, with the most significant increase being depreciation and amortization expense.

Total expenses increased by $8.7 million to $79.2 million for the six months ended June 30, 2026 as compared to $70.5 million for the six months ended June 30, 2025.

The increase is primarily attributed to an increase in the number of operating properties, with the most significant increase being depreciation and amortization expense, property expenses, and general and administrative expenses, partially offset by a decrease in provisions for impairment.

Total operating expenses include the following:

• Property expenses.

Property expenses increased by $0.6 million to $5.4 million for the three months ended March 31, 2026 from $4.8 million for the three months ended March 31, 2025.

The increase is primarily attributed to an increase in the number of operating properties, including combined net increases of reimbursable property expenses of $0.5 million, of which $0.5 million and $0.1 million were related to reimbursable property taxes and reimbursable insurance costs, respectively, partially offset by a decrease of $0.2 million of reimbursable common area maintenance costs, and combined net increases of non-reimbursable property expenses of $0.2 million primarily related to common area maintenance costs and property insurance.

Property expenses increased $1.8 million to $11.1 million for the six months ended June 30, 2026 from $9.3 million for the six months ended June 30, 2025.

The increase is primarily attributed to an increase in the number of operating properties, including combined net increases of reimbursable property expenses of $1.5 million, of which $1.2 million were related to reimbursable property taxes and $0.3 million were related to reimbursable insurance, and an increase of $0.4 million of non-reimbursable property expenses, of which $0.3 million were related to common area maintenance and $0.1 million were related to property taxes.

• General and administrative expenses.

General and administrative expenses increased by $0.6 million to $5.8 million for the three months ended March 31, 2026 from $5.2 million for the three months ended March 31, 2025.

The increase is primarily related to an increase of $0.4 million of payroll expense and an increase of $0.3 million in stock based compensation expense, offset by other combined net decreases of $0.1 million.

While our general and administrative expenses will continue to rise in some measure as our portfolio grows, we expect that such expenses as a percentage of our portfolio ABR and total assets will decrease over time due to efficiencies and economies of scale.

General and administrative expenses increased $1.0 million to $11.6 million for the six months ended June 30, 2026 from $10.6 million for the six months ended June 30, 2025.

The increase is primarily related to an increase of $0.5 million of payroll expense and an increase of $0.5 million of stock-based compensation.

• Depreciation and amortization.

Depreciation and amortization expense increased by $3.6 million to $24.5 million for the three months ended March 31, 2026 from $20.9 million for the three months ended March 31, 2025.

Depreciation and amortization expense increased by $7.9 million to $50.3 million for the six months ended June 30, 2026 from $42.4 million for the six months ended June 30, 2025.

The increase in depreciation and amortization is proportionate to the increase in the size of the portfolio over the comparable period with associated increases primarily in building depreciation expense of $4.6 million, in-place lease amortization expense of $1.7 million, and building improvements depreciation expense of $1.6 million.

• Provisions for impairment.

For the three months ended March 31, 2026, we recorded provisions for impairment of $2.1 million on nine properties and one mortgage loan receivable, the majority of which were either previously classified as held-for-sale, newly classified as held-for-sale, or disposed during three months ended March 31, 2026.

Of those properties impaired, two properties were held for investment as of March 31, 2026.

For the three months ended March 31, 2025, we recorded provisions for impairment of $3.6 million on 13 properties, the majority of which were newly classified as held-for-sale during the three months ended March 31, 2025.

Of those properties impaired, one property was held for investment as of March 31, 2025.

These disposals relate to management’s continuous assessment of our portfolio in an effort to improve returns and manage risk exposure.

Interest expense.

Interest expense increased by $2.8 million to $14.3 million for the three months ended March 31, 2026 from $11.5 million for the three months ended March 31, 2025.

The increase is primarily attributed to an increase of $2.2 million of interest incurred on our $200.0 million senior unsecured term loan (the “2031 Term Loan”), an increase of $1.7 million of interest incurred on our 2032 Term Loan, and in increase of $0.3 million in loan fee amortization, most of which is related to the 2031 Term Loan and 2032 Term Loan.

The increase was partially offset by $1.2 million of reduced interest incurred on our Revolver, primarily due to a decrease in average borrowings outstanding during the respective periods, and $0.3 million of reduced interest incurred on our $200.0 million senior unsecured term loan (the “2028 Term Loan”), our $250.0 million senior unsecured term loan (the “2029 Term Loan”), our $175.0 million senior unsecured term loan (the “2030 Term Loan A”), and our $175.0 million senior unsecured term loan (the “2030 Term Loan B”), primarily related to the interest rate reduction as a result of receiving a credit rating at the end of 2025.

For the six months ended June 30, 2026, we recorded provisions for impairment of $6.3 million on 18 properties and one mortgage loan receivable, the majority of which were either previously classified as held-for sale, newly classified as held-for-sale, or disposed of during the six months ended June 30, 2026.

Of those properties impaired, one property was held for investment as of June 30, 2026.

For the six months ended June 30, 2025, we recorded provisions for impairment of $8.0 million on 21 properties, the majority of which were either previously classified as held-for-sale, newly classified as held-for-sale, or disposed of during the six months ended June 30, 2025.

Of those properties impaired, one property was held for investment as of June 30, 2025.

Property disposals relate to management’s continuous assessment of our portfolio in an effort to improve returns and manage risk exposure.

Interest expense, net.

Interest expense increased by $5.7 million to $29.8 million for the six months ended June 30, 2026 from $24.1 million for the six months ended June 30, 2025.

The increase is primarily attributed to an increase of $4.4 million of interest incurred on our 2031 Term Loan, an increase of $4.2 million of interest incurred on our 2032 Term Loan, and an increase of $0.5 million in loan fee amortization, most of which is related to the 2031 Term Loan and 2032 Term Loan.

The increase was partially offset by $2.4 million of reduced interest incurred on our Revolver, primarily due to a decrease in average borrowings outstanding during the respective periods, collectively $0.9 million of reduced interest incurred on our 2028 Term Loan, 2029 Term Loan, 2030 Term Loan A, and 2030 Term Loan B, primarily related to the interest rate reduction as a result of receiving a credit rating at the end of 2025, and $0.1 million related to additional capitalized interest on our property developments.

Gain on sales of real estate, net.

Net gain on sales of real estate decreased by $2.0 million to $0.1 million for the three months ended March 31, 2026 from $2.1 million for the three months ended March 31, 2025.

For the three months ended March 31, 2026, five properties were sold for a sales price, net of disposal costs, of $10.4 million.

For the three months ended March 31, 2025, 16 properties were sold for a sales price, net of disposal costs, of $38.6 million.

Net gain on sales of real estate decreased by $3.8 million to $1.8 million for the six months ended June 30, 2026 from $5.6 million for the six months ended June 30, 2025.

For the six months ended June 30, 2026, 21 properties were sold for a sales price, net of disposal costs, of $55.5 million.

For the six months ended June 30, 2025, 36 properties were sold for a sales price, net of disposal costs, of $94.2 million.

Other income (expense), net.

Other income (expense), net increased by $0.6 million to $0.4 million of other income, net for the three months ended March 31, 2026 from $0.2 million of other expense, net for the three months ended March 31, 2025.

The net increase to income is primarily related to a $0.3 million increase in interest income on bank accounts and a $0.4 million decrease in third-party debt issuance costs that were expensed during the three months ended March 31, 2025 as a result of the January 2025 debt transaction.

Net income increased by $4.0 million to $5.7 million for the three months ended March 31, 2026 from $1.7 million for the three months ended March 31, 2025.

Net income increased primarily due to additional rental revenues, primarily due to the growth in the size of our real estate investment portfolio, and decreased provisions for impairment, partially offset by increases in depreciation expense, interest expense, general and administrative expense, property expense, and a decrease in gain on sales of real estate.

Other income (expense), net increased by $1.1 million to $1.0 million of other income, net for the six months ended June 30, 2026 from $0.1 million of other expense, net for the six months ended June 30, 2025.

The increase is primarily attributed to a $0.4 million non-cash increase in our mortgage loans receivable related to the recovery of development incentive funds, a $0.4 million decrease in third-party debt issuance costs that were expensed during the six months ended June 30, 2025 as a result of the January 2025 debt transaction, and a $0.3 million increase in interest income on bank accounts.

Net income increased by $7.0 million to $12.0 million for the six months ended June 30, 2026 from $5.0 million for the six months ended June 30, 2025.

Net income increased primarily due to increases in additional rental revenues, primarily due to the growth in the size of our real estate investment portfolio, a decrease in provisions for impairment, and an increase in other income (expense), net.

The increase in net income is partially offset by increases in depreciation and amortization expense, interest expense, property expense, general and administrative expenses, and a decrease in gain on sales of real estate.

Liquidity and Capital Resources

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Our capital resources primarily consist of cash from operations, sales of equity securities, and available borrowing facilities.

As of March 31, 2026, we had total outstanding debt of $1.2 billion, including $200.0 million outstanding principal amount under the 2028 Term Loan, $250.0 million outstanding principal amount under the 2029 Term Loan, $175.0 million outstanding principal amount under the 2030 Term Loan A, $175.0 million outstanding principal amount under the 2030 Term Loan B, $200.0 million outstanding principal amount under the 2031 Term Loan, $150.0 million outstanding principal amount under the 2032 Term Loan, and $88.0 million outstanding on the Revolver.

Additionally, as of March 31, 2026, we had $194.4 million and $29.9 million of unsettled forward equity under our 2024 ATM Program and prior at-the-market equity program, respectively.

As of March 31, 2026, $49.9 million of shares of our common stock were available for future issuances under the 2024 ATM Program.

Lastly, we had $81.7 million, $71.2 million, and $228.4 million of unsettled forward equity under the January 2024, July 2025, and February 2026 follow-on offering forward sale agreements, respectively, as of March 31, 2026.

As of March 31, 2026, we had an aggregate of 34,201,865 unsettled shares under forward sale agreements with a weighted-average net settlement price of $17.71.

As of June 30, 2026, we had total outstanding debt of $1.4 billion, including $200.0 million outstanding principal amount under the 2028 Term Loan, $250.0 million outstanding principal amount under the 2029 Term Loan, $175.0 million outstanding principal amount under the 2030 Term Loan A, $175.0 million outstanding principal amount under the 2030 Term Loan B, $200.0 million outstanding principal amount under the 2031 Term Loan, $200.0 million outstanding principal amount under the 2032 Term Loan, and $198.5 million outstanding on the Revolver.

Additionally, as of June 30, 2026, we had $176.6 million and $229.1 million of unsettled forward equity under our 2026 ATM Program and prior at-the-market equity programs, respectively.

As of June 30, 2026, $221.6 million of shares of our common stock were available for future issuances under the 2026 ATM Program.

Lastly, we had $81.2 million and $227.3 million of unsettled forward equity under the January 2024 and February 2026 follow-on offering forward sale agreements, respectively, as of June 30, 2026.

As of June 30, 2026, we had an aggregate of 38,942,108 unsettled shares under forward sale agreements with a weighted-average net settlement price of $18.34.

We believe the availability of proceeds from our debt, proceeds from the settlement of unsettled outstanding forward sale agreements, future issuances of shares of our common stock under our 2026 ATM Program, or subsequent at-the-market sale programs, as well as our cash flows from operations and available borrowing capacity under the Revolver, will be adequate to support our ongoing operations and to fund our debt service requirements, capital expenditures, and working capital requirements for at least the next 12 months.

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Contractual Obligations and Commitments

As of March 31, 2026, our contractual debt obligations primarily include the maturity of our 2028 Term Loan with the scheduled principal payment due on February 11, 2028, the maturity of our 2029 Term Loan with the scheduled principal payment due on July 3, 2026, the maturities of our 2030 Term Loan A, 2030 Term Loan B, and Revolver with the scheduled principal payments due on January 15, 2029, the maturity of our 2031 Term Loan with the scheduled principal payment due on March 25, 2031, and the maturity of our 2032 Term Loan with the scheduled principal payment due on September 24, 2032.

During the three months ended March 31, 2026, we borrowed $98.0 million and repaid $10.0 million on our Revolver.

The following table provides information with respect to our commitments as of March 31, 2026 (in thousands):

As of June 30, 2026, our contractual debt obligations primarily include the maturity of our 2028 Term Loan with the scheduled principal payment due on February 11, 2028, the maturity of our 2029 Term Loan with the scheduled principal payment due on July 3, 2027, the maturities of our 2030 Term Loan A, 2030 Term Loan B, and Revolver with the scheduled principal payments due on January 15, 2029, the maturity of our 2031 Term Loan with the scheduled principal payment due on March 25, 2031, and the maturity of our 2032 Term Loan with the scheduled principal payment due on September 24, 2032.

During the six months ended June 30, 2026, we borrowed $340.0 million and repaid $141.5 million on our Revolver.

The following table provides information with respect to our commitments as of June 30, 2026 (in thousands):

Payment Due by Period

Total From April 1, 2026 to December 31, 2026 2027 - 2028 2029 - 2030 Thereafter

Total Remainder of 2026 2027 - 2028 2029 - 2030 Thereafter

Contractual Obligations

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These commitments are generally subject to our customary due diligence process and, accordingly, a number of specific conditions must be met before we are obligated to purchase or extend funding.

As of March 31, 2026, we had commitments to fund property developments, extend funds under mortgage loans receivable, and commitments to fund tenant improvement allowances totaling $22.3 million, $6.4 million, and $8.3 million, respectively.

Commitments to fund property developments are expected to occur over the next nine months, commitments to fund mortgage loans receivable are expected to occur over the next 18 months, and commitments to fund tenant improvement allowances are expected to occur over the next two years.

See discussion of our debt and interest rate hedges included in “Note 6 – Debt” and “Note 7 – Derivative Financial Instruments” in “Item 1 – Financial Statements (unaudited).”

As of June 30, 2026, we had commitments to fund property developments, extend funds under mortgage loans receivable, and fund tenant improvement allowances totaling $25.1 million, $11.3 million, and $7.9 million, respectively.

Commitments to fund property developments are expected to occur over the next nine months, while commitments to fund mortgage loans receivable and tenant improvement allowances are expected to occur over the next 18 months.

See discussion of our debt and interest rate hedges included in “Note 6 – Debt” and “Note 7 – Derivative Financial Instruments” of our condensed consolidated financial statements, included in “Item 1 – Financial Statements (unaudited)”.

Historical Cash Flow Information

Three Months Ended March 31, 2026 Compared with Three Months Ended March 31, 2025

Three Months Ended

(In thousands) (Unaudited)

Six Months Ended June 30, 2026 Compared with the Six Months Ended June 30, 2025

Six Months Ended June 30,

(In thousands) 2026 2025

Net cash provided by (used in):

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Cash Flows Provided By Operating Activities.

Net cash provided by operating activities increased by $4.2 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

The increase was largely attributed to the increase in the size of our real estate investment portfolio with an increase in rental receipts of $9.5 million, partially offset by an increase in cash paid for interest of $2.7 million, an increase in operating expenses paid associated with our larger portfolio, and changes in working capital accounts.

Net cash provided by operating activities increased by $10.3 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

The increase was largely attributed to the increase in the size of our real estate investment portfolio with an increase in rental receipts of $20.7 million, partially offset by an increase in cash paid for interest of $5.2 million, and an increase in operating expenses paid associated with our larger portfolio, and changes in working capital accounts.

Cash Flows Used In Investing Activities.

Net cash used in investing activities increased by $163.4 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

The increase was primarily due to an increase in acquisitions of real estate of $156.2 million, a decrease in proceeds from the sale of real estate of $28.2 million, and an increase in real estate development and improvements of $2.9 million, partially offset by a decrease in earnest money deposits of $6.5 million, an increase in principal collections on mortgage loans receivable of $6.4 million, an increase in proceeds received from the sale of mortgage loans receivable of $5.6 million, and a decrease in cash invested in mortgage loans receivable of $5.4 million.

Net cash used in investing activities increased by $350.5 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

The increase was primarily due to an increase in acquisitions of real estate of $294.1 million, a decrease in proceeds received from the sale of real estate of $36.3 million, an increase in cash invested in mortgage loans receivable of $22.8 million, and an increase in real estate development and improvements of $9.9 million.

The increase was partially offset by an increase in proceeds received from the sale of mortgage loans receivable of $5.6 million, a decrease in earnest money deposits of $5.0 million, and an increase in principal collections on mortgage loans receivable of $1.9 million.

Cash Flows Provided By Financing Activities.

Net cash provided by financing activities increased by $155.9 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

The increase was primarily attributed to a decrease in net repayments of $212.5 million under our Revolver, an increase of $67.8 million of proceeds received from the issuance of common stock under our January 2024 Follow-On Offering, and a decrease in deferred financing costs of $6.3 million, partially offset by a decrease in net term loan proceeds of $125.0 million, an increase in payments of common stock dividends of $4.2 million, and an increase in the repurchase of common stock for tax withholding obligations of $1.1 million.

Net cash provided by financing activities increased by $340.3 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

The increase was primarily attributed to an increase in net borrowings of $310.5 million under our Revolver, an increase in proceeds received from the issuance of common stock of $110.1 million, which includes $138.5 million more proceeds received from our follow-on offerings and $28.4 million less proceeds received in connection with our ATM Programs (as defined in “Note 10 - Shareholders’ Equity”), and a decrease in deferred financing costs of $6.0 million.

The increase is partially offset by a decrease in net term loan proceeds of $75.0 million, an increase in payments of common stock dividends of $8.5 million, an increase in the repurchase of common stock for tax withholding obligations of $1.2 million, an increase in deferred offering costs of $1.0 million, an increase in the repayment of property development incentives of $0.4 million, and an increase in payments of restricted stock dividends of $0.2 million.

We have elected to be treated and qualify as a REIT for U.S.

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Recent Accounting Pronouncements

A discussion of recent accounting pronouncements and their possible effects on our condensed consolidated financial statements is included in “Note 2 – Summary of Significant Accounting Policies” in “Item 1 – Financial Statements (unaudited).”

A discussion of recent accounting pronouncements and their possible effects on our condensed consolidated financial statements is included in “Note 2 – Summary of Significant Accounting Policies” of our condensed consolidated financial statements, included in “Item 1 – Financial Statements (unaudited)”.

Critical Accounting Policies and Estimates

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We also disclose the following non-GAAP financial measures:

Funds From Operations (“FFO”), Core FFO, Adjusted FFO (“AFFO”), earnings before interest expense, income tax expense, and depreciation and amortization (“EBITDA”), EBITDA further adjusted to exclude gains (or losses) from the sales of depreciable property and real estate impairment losses (“EBITDA re ”), Adjusted EBITDAre, Annualized Adjusted EBITDA re , Net Debt, Adjusted Net Debt, property-level net operating income (“Property-Level NOI”), property-level cash net operating income (“Property-Level Cash NOI”), and property-level cash net operating income estimated run rate (“Property-Level Cash NOI Estimated Run Rate”), all of which are detailed below.

Funds From Operations (“FFO”), Core FFO, Adjusted FFO (“AFFO”), earnings before interest expense, income tax expense, and depreciation and amortization (“EBITDA”), EBITDA further adjusted to exclude gains (or losses) from the sales of depreciable property and real estate impairment losses (“EBITDA re ”), Adjusted EBITDA re , Annualized Adjusted EBITDA re , Net Debt, Adjusted Net Debt, property-level net operating income (“Property-Level NOI”), property-level cash net operating income (“Property-Level Cash NOI”), and property-level cash net operating income estimated run rate (“Property-Level Cash NOI Estimated Run Rate”), all of which are detailed below.

We believe these non-GAAP financial measures are industry measures used by analysts and investors to compare the operating performance of REITs.

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Our FFO is net income in accordance with GAAP, excluding gains (or losses) resulting from dispositions of properties, plus depreciation and amortization and impairment charges on depreciable real property.

Core FFO is a non-GAAP financial measure defined as FFO adjusted to remove the effect of unusual and non-recurring items that are not expected to impact our operating performance or operations on an ongoing basis.

These include non-recurring executive transition costs, severance and related charges, other non-recurring losses (gains), debt related transaction costs, and other losses (gains).

Core FFO is a non-GAAP financial measure defined as FFO adjusted to exclude infrequent and unusual items not expected to impact our operating performance on an ongoing basis.

These include executive transition costs, severance, and related charges, debt-related transaction costs, and other non-core losses (gains) as they occur.

AFFO is a non-GAAP financial measure defined as Core FFO adjusted for GAAP net income related to non-cash revenues and expenses, such as straight-line rent, amortization of above- and below-market lease-related intangibles, amortization of lease incentives, capitalized interest expense and earned development interest, non-cash interest expense, non-cash compensation expense, amortization of deferred financing costs, amortization of above/below-market assumed debt, and amortization of loan origination costs.

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The following table sets forth a reconciliation of FFO, Core FFO, and AFFO for the periods presented to net income before allocation to noncontrolling interests, as computed in accordance with GAAP (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

(Unaudited) (Unaudited)

Net income $ 6,311 3,289 $ 12,022 $ 4,989

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Non-recurring executive transition costs, severance, and related charges — 3 — 79

Loss on debt extinguishment and other related costs — 403

Debt-related transaction costs 16 — 16 403

Other non-recurring gain (375) — (375) —

Other loss — — 574 —

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NAREIT defines EBITDA re as EBITDA (as defined above) excluding gains (or losses) from the sales of depreciable property and impairment charges on depreciable real property.

Adjusted EBITDA re is a non-GAAP financial measure defined as EBITDA re further adjusted to exclude straight-line rent, non-cash compensation expense, non-recurring executive transition costs, severance and related charges, debt related transaction costs, transaction costs, other non-recurring loss (gain), net, other non-recurring expenses (income) including lease termination fees, as well as adjustments for construction in process and for intraquarter activities.

Adjusted EBITDA re is a non-GAAP financial measure defined as EBITDA re further adjusted to exclude straight-line rent, non-cash compensation expense, executive transition costs, severance, and related charges, debt related transaction costs, transaction costs, other non-recurring losses (gains), other non-recurring expenses (income), including lease termination fees, as well as adjustments for construction in process and for intraquarter activities.

Annualized Adjusted EBITDA re is Adjusted EBITDA re multiplied by four.

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The following table sets forth a reconciliation of EBITDA and EBITDA re for the periods presented to net income before allocation to noncontrolling interests, as computed in accordance with GAAP (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

(Unaudited) (Unaudited)

Net income $ 6,311 3,289 $ 12,022 $ 4,989

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The following table sets forth a reconciliation of EBITDA, EBITDA re , Adjusted EBITDA re, and Annualized Adjusted EBITDA re for the period presented to net income before allocation to noncontrolling interests, as computed in accordance with GAAP (in thousands):

Three Months Ended March 31, 2026

Three Months Ended

June 30, 2026

Net income $ 6,311

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Straight-line rent adjustments (2,281)

Other loss 574

Debt-related transaction costs 16

Other non-recurring gain (375)

Other income, net (474)

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Annualized Adjusted EBITDA re (3)

Adjusted Net Debt / Annualized Adjusted EBITDA re

Net Debt / Annualized Adjusted EBITDA re

Adjusted Net Debt / Annualized Adjusted EBITDA re

Pro Forma Adjusted Net Debt / Annualized Adjusted EBITDA re

(1) Adjustment reflects the estimated cash yield on developments in process as of March 31, 2026.

(2) Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended March 31, 2026, had occurred on January 1, 2026.

(1) Adjustment reflects the estimated cash yield on developments in process as of June 30, 2026.

(2) Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended June 30, 2026 had occurred on April 1, 2026.

(3) We calculate Annualized Adjusted EBITDA re by multiplying Adjusted EBITDA re by four.

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The following table reconciles the principal amount of total debt to Net Debt, Adjusted Net Debt, and Pro Forma Adjusted Net Debt (in thousands):

March 31, 2026

June 30, 2026

Principal amount of total debt $ 1,406,457

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Pro Forma Adjusted Net Debt $ 667,753

(1) There were 34,201,865 unsettled shares under forward sale agreements as of March 31, 2026 with a weighted-average net settlement price of $17.71.

(1) There were 38,942,108 unsettled shares under forward sale agreements as of June 30, 2026 with a weighted-average net settlement price of $18.34.

(2) There were 210,670 unsettled shares under new forward equity contracts executed subsequent to the period with a weighted-average net settlement price of $21.27.

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The following table sets forth a reconciliation of Property-Level NOI, Property-Level Cash NOI, and Property-Level Cash NOI - Estimated Run Rate for the period presented (in thousands):

Three Months Ended March 31, 2026

Three Months Ended

June 30, 2026

Net income $ 6,311

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Property-Level Cash NOI $ 50,049

Adjustment for intraquarter acquisitions, dispositions, and completed development (1)

Adjustment for intraquarter acquisitions, dispositions, and completed developments (1)

Property-Level Cash NOI Estimated Run Rate $ 53,405

(1) Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended March 31, 2026, had occurred on January 1, 2026.

(1) Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended June 30, 2026, had occurred on April 1, 2026.

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-Q

Item 2. Management’s Discussion and Analysis