What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-02-17 compared with 2025-02-19 · 73 added, 81 removed, 297 unchanged (34% of the section changed)

5 unchanged sentences

We intend to use cash on hand, cash flows generated from the operation of our properties, net proceeds from the disposition of select properties, and borrowings under our $600 Million Unsecured 2022 Line of Credit as our primary sources of immediate liquidity.

On February 13, 2025, we amended our $200 Million Unsecured 2024 Term Loan to increase the principal amount of the loan by $125 million to a total of $325 million principal amount outstanding and to add two six-month extension options for a final maturity date of January 29, 2028, provided that we are not then in default and upon payment of extension fees.

The net proceeds from the increased principal and our $600 Million Unsecured 2022 Line of Credit, along with cash on hand, were used to repay our $250 Million Unsecured 2018 Term Loan that was scheduled to mature in March of 2025.

Also subsequent to December 31, 2024, Piedmont recast the $600 Million Unsecured 2022 Line of Credit to extend the maturity date to June 30, 2028, with two additional one-year extension options, for a final maturity date of June 30, 2030, provided that we are not then in default and upon payment of extension fees.

Consequently, we currently have no debt with a final maturity until 2028;

however, as part of our overall debt management strategies, we may seek other new secured or unsecured borrowings from third party lenders or issue other debt or equity securities as additional sources of capital.

As of December 31, 2025, we had $553 million of borrowing capacity available under our $600 Million Unsecured 2022 Line of Credit and no required debt maturities until 2028.

Consequently, we believe that we have sufficient liquidity to meet our obligations for the foreseeable future;

however, as part of our overall debt management strategy, we may seek other new secured or unsecured borrowings from third party lenders or issue other debt or equity securities as additional sources of capital.

The nature and timing of these additional sources of capital will be highly dependent on market conditions.

As of the date of this filing we had approximately $500 million of capacity available under our $600 Million Unsecured 2022 Line of Credit, and we believe that we have sufficient liquidity to meet our obligations for the foreseeable future.

Our most consistent use of capital has historically been, and we believe will continue to be, to fund capital expenditures for our existing portfolio of properties.

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(1) Of the total amounts paid, approximately $17.7 million and $19.9 million related to soft costs such as capitalized interest, payroll, and other general and administrative expenses for the year ended December 31, 2025 and 2024, respectively.

"Capital expenditures for redevelopment/renovations" during the years ended December 31, 2024 and 2023 related to building upgrades, primarily to the lobbies and the addition of tenant amenities at certain of our buildings, including:

Galleria Towers in Dallas, Texas;

The Exchange in Orlando, Florida;

999 Peachtree Street and Galleria on the Park in Atlanta, Georgia, and Meridian in suburban Minneapolis, Minnesota, among others, most of which were substantially completed during 2024.

"Capital expenditures for redevelopment/renovations" during the years ended December 31, 2025 and 2024 related to building upgrades, primarily to the lobbies and the addition of tenant amenities at certain of our buildings and assets under redevelopment.

"Other capital expenditures, including building and tenant improvements" include all other capital expenditures during the respective period and are typically comprised of tenant and building improvements necessary to lease, maintain, or provide enhancements, including energy efficient equipment, to our existing portfolio of office properties.

We currently do not anticipate incurring any unusually large or material capital expenditures within any given year in order to meet recognized sustainable development standards, and achieve our environmental impact goals.

Given that our operating model frequently results in leases for multiple blocks of space to credit-worthy tenants, our leasing success can result in capital outlays which vary from one reporting period to another based upon the specific leases executed.

For leases executed during the year ended December 31, 2024, we have committed to spend approximately $5.67 per square foot per year of lease term for tenant improvement allowances and lease commissions (net of expired lease commitments) as

Index to Financial Statements

compared to $5.22 (net of expired lease commitments) for the year ended December 31, 2023.

As of December 31, 2024, we had two individually significant unrecorded tenant allowance commitments greater than $10 million.

For leases executed during the year ended December 31, 2025, we have committed to spend approximately $6.58 per square foot per year of lease term for tenant improvement allowances and lease commissions (net of expired lease commitments) as compared to $5.67 (net of expired lease commitments) for the year ended December 31, 2024 with the increase in the current year attributable to the significant amount of new tenant leasing completed.

As of December 31, 2025, we had no individual tenant allowance commitments greater than $10 million.

In addition to the amounts that we have already committed to as a part of executed leases, we also anticipate continuing to incur similar market-based tenant improvement allowances and leasing commissions in conjunction with procuring future leases for our existing portfolio of properties.

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Although reducing outstanding debt remains our priority, subject to the identification and availability of a few, select investment opportunities and our ability to consummate such acquisitions on satisfactory terms, acquiring new assets consistent with our investment strategy could also be a significant use of capital.

Additionally, although we have no final debt maturity until 2028, we may use capital to repay debt obligations when we deem it prudent to refinance or reduce various obligations.

We also use capital resources to pay dividends to our stockholders.

The amount and form of payment (cash or stock issuance) of future dividends to be paid to our stockholders will continue to be largely dependent upon (i) the amount of cash generated from our operating activities;

Additionally, we may use capital to repay debt when we deem it prudent to refinance or reduce various obligations.

Index to Financial Statements

Finally, we may also use capital resources to pay dividends to our stockholders.

The amount and form of payment (cash or stock issuance) of future dividends, if any, to be paid to our stockholders will continue to be largely dependent upon (i) the amount of cash generated from our operating activities;

(ii) our expectations of future cash flows;

(iii) our determination of near-term cash needs for debt repayments, development projects, and selective acquisitions of new properties;

(iv) the timing of significant expenditures for tenant improvements, leasing commissions, building redevelopment projects, and general property capital improvements;

(iv) the timing of significant expenditures for tenant improvements, leasing commissions, building redevelopment projects, and general property improvements;

(v) long-term dividend payout ratios for comparable companies;

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Results of Operations (2025 vs.

Net loss applicable to common stockholders for the year ended December 31, 2024 was approximately $79.1 million, or $0.64 per diluted share, as compared with net loss applicable to common stockholders of $48.4 million, or $0.39 per diluted share, for the year ended December 31, 2023.

The increase in net loss reflects increased interest expense, net of interest income, as compared to the prior year, as well as the sale of two properties and downtime between the expiration of a few large leases during the year ended December 31, 2024, before newly executed leases commence.

Additionally, we recognized approximately $4.8 million of executive separation costs during the year ended December 31, 2024.

Net loss applicable to common stockholders for the year ended December 31, 2025 was approximately $83.6 million, or $0.67 per diluted share, as compared with $79.1 million, or $0.64 per diluted share, for the year ended December 31, 2024.

The primary driver of the increase in net loss was an approximately $37.8 million loss on early extinguishment of debt recognized during the year ended 2025, which was largely offset by the non-recurrence of approximately $33.8 million of impairment charges recognized during the year ended 2024.

Comparison of the accompanying consolidated statements of operations for the year ended December 31, 2025 vs.

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Loss on early extinguishment of debt (37.8) 7 % (0.4) — % (37.4)

Gain on sale of real estate assets (0.4) — % 1.9 — % (2.3)

Gain/(loss) on sale of real estate assets

2.0 — % (0.4) — % 2.4

Net loss $ (83.6) (15) % $ (79.1) 14 % $ (4.5)

Rental and tenant reimbursement revenue decreased approximately $6.1 million for the year ended December 31, 2025 as compared to the prior year.

The decrease was primarily due to lost revenues during the downtime between certain large tenant expirations and the commencement or abatement expiration associated with recently executed leases, as well as the disposition of two properties in 2024.

The impact of these decreases is partially offset by the roll up of rental rates and new leases commencing during the year ended December 31, 2024.

Other property related income increased approximately $3.8 million for the year ended December 31, 2024 as compared to the prior year primarily due to increased occupancy and utilization at our properties and higher transient parking at our office projects during the current period, as compared to the prior period.

The decrease was primarily due to the disposition of four projects subsequent to January 1, 2024 as well as lower tenant reimbursement revenue in the current year as compared to the prior year associated with lower recoverable operating costs (as discussed below).

The impact of this decrease was partially offset by the roll-up of rental rates and new leases commencing during the year ended December 31, 2025.

Property management fee revenue decreased approximately $1.4 million for the year ended December 31, 2025, as compared to the same period in the prior year due to the termination of certain third-party property management arrangements in 2024.

Other property related income increased approximately $2.2 million for the year ended December 31, 2025 as compared to the prior year primarily due to increased parking income associated with increased utilization and higher transient parking at our office projects during the current year, as compared to the prior year.

Index to Financial Statements

Property operating costs decreased approximately $6.2 million for the year ended December 31, 2025 as compared to the prior year.

The variance was primarily due to a decrease in property operating expenses associated with the sale of two properties in 2024 as well as lower property taxes associated with favorable tax assessments.

These decreased costs were partially offset by higher recoverable operating expenses such as janitorial, security, repairs and maintenance and other general expenses as tenant utilization increased during the year ended December 31, 2024.

The variance was primarily due to reduced property tax expense due to lower tax assessments and successful appeals, as well as project dispositions subsequent to January 1, 2024 (as discussed above).

The impact of these decreases is partially offset by an increase in other recoverable property operating costs such as utilities, repairs and maintenance, landscaping and security due to increased occupancy and utilization of our projects during the current year, as compared to the prior year.

Depreciation expense increased approximately $9.6 million for the year ended December 31, 2025 compared to the prior year.

The increase was primarily due to additional building and tenant improvements acquired and/or placed in service subsequent to January 1, 2023.

The increase was primarily due to additional building and tenant improvements acquired and/or placed in service subsequent to January 1, 2024, partially offset by property dispositions in 2024 and 2025.

Amortization expense decreased approximately $9.2 million for the year ended December 31, 2025 compared to the prior year.

The decrease in amortization expense is associated with certain lease intangible assets at our existing projects becoming fully amortized subsequent to January 1, 2024.

The decrease was partially offset by an increase in amortization expense associated with deferred lease acquisition costs associated with new leasing activity during the two years ended December 31, 2025.

During the year ended December 31, 2024, we recognized a non-cash impairment charge of approximately $33.8 million related to a change in hold period assumptions at certain properties in our portfolio.

Two of these projects, the One Lincoln Park building and 750 West John Carpenter Freeway building were subsequently sold during the year ended December 31, 2024.

During the year ended December 31, 2023, we reduced the carrying amount of goodwill resulting in the recognition of non-cash impairment charges of approximately $29.4 million.

See Note 6 to our accompanying consolidated financial statements for further details.

General and administrative expense increased approximately $6.2 million for the year ended December 31, 2024 compared to the prior year, primarily as the result of recognizing approximately $4.8 million of executive separation costs that occurred during the fourth quarter of 2024.

The remainder of the increase primarily reflects increased accruals for potential performance-based compensation, largely associated with successful leasing during the year ended 2024.

General and administrative expense decreased approximately $4.8 million for the year ended December 31, 2025 compared to the prior year almost exclusively as the result of the recognition of $4.8 million of executive separation costs during 2024.

Other Income (Expense)

Interest expense increased approximately $21.7 million for the year ended December 31, 2024 as compared to the prior year primarily driven by increased interest rates on floating-rate debt during the year ended December 31, 2024 as well as refinancing $1.2 billion of maturing debt at higher rates during the latter half of 2023 and first half of 2024.

The increase was partially offset by a $5.9 million increase in capitalized interest associated with various redevelopment projects in progress during the year ended December 31, 2024.

Interest expense increased approximately $5.0 million for the year ended December 31, 2025 as compared to the prior year as a result of refinancing activity as well as a $2.0 million decrease in capitalized interest during the year ended December 31, 2025.

During the year ended December 31, 2025, we repurchased approximately $312.7 million in aggregate principal amount of the $600 Million Unsecured Senior Notes due 2028.

The premium paid to repurchase the notes, as well as the write-off of the pro-rata share of unamortized debt issuance costs, resulted in the recognition of a $37.3 million loss on early extinguishment of debt.

The loss on early extinguishment of debt in the prior year was due to the write-off of unamortized debt issuance costs associated with refinancing activity during the year ended December 31, 2024.

Gain on sale of real estate assets during the year ended December 31, 2025 primarily consists of the gain recognized on the sale of the 80 and 90 Central project in Boston, Massachusetts, which closed in May of 2025, as well as recognition of the return of amounts held in escrow for the 750 West John Carpenter project sold in July 2024.

During the prior year we recognized a loss on the sale of the 750 West John Carpenter project of approximately $0.4 million.

Results of Operations (2024 vs.

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Issuer and Guarantor Financial Information

As of December 31, 2024, Piedmont, through its wholly-owned subsidiary Piedmont OP, had four separate issuances totaling approximately $1.6 billion of senior unsecured notes payable outstanding that mature in 2028, 2029, 2030 and 2032 (see Note 3 to our accompanying consolidated financial statements for additional details regarding each of these issuances) (collectively, the "Notes").

As of December 31, 2025, Piedmont, through its wholly-owned subsidiary Piedmont OP, had five separate issuances totaling approximately $1.7 billion of senior unsecured notes payable outstanding that mature in 2028, 2029, 2030, 2032 and 2033 (see Note 3 to our accompanying consolidated financial statements for additional details regarding each of these issuances) (collectively, the "Notes").

The Notes are senior unsecured obligations of Piedmont OP, rank equally in right of payment with all of Piedmont OP's other existing and future senior unsecured indebtedness, and would be effectively subordinated in right of payment to any of Piedmont OP’s future mortgage or other secured indebtedness (to the extent of the value of the collateral securing such indebtedness) and to all existing and future indebtedness and other liabilities of Piedmont OP’s subsidiaries, whether secured or unsecured.

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Pursuant to Rule 13-01 of Regulation S-X, Guarantors and Issuers of Guaranteed Securities Registered or Being Registered, the following tables present summarized financial information for Piedmont OP as issuer and Piedmont as guarantor on a combined basis after elimination of (i) intercompany transactions and balances among Piedmont OP and Piedmont and (ii) equity in earnings from and investments in any subsidiary that is a non-guarantor (in thousands):

Combined Balances of Piedmont OP and Piedmont Office Realty Trust, Inc.

Combined Balances of Piedmont OP and Piedmont Realty Trust, Inc.

as Issuer and Guarantor, respectively As of

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These two properties are included in "Other" below.

See Note 14 to the accompanying consolidated financial statements for additional information and a reconciliation of Net income/(loss) applicable to Piedmont to Net Operating Income ("NOI").

The following table presents accrual-basis NOI by geographic segment (in thousands):

See Note 13 to the accompanying consolidated financial statements for additional information and a reconciliation of Net loss applicable to Piedmont to accrual-based net operating income ("NOI").

The following table presents NOI by geographic segment (in thousands):

Years Ended December 31,

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Comparison of the Year Ended December 31, 2025 Versus the Year Ended December 31, 2024

NOI increased due to several large leases commencing at our Galleria on the Park and 999 Peachtree Street projects during the year ended December 31, 2024 as compared to the same period in the prior year.

NOI decreased due to the sales of the One Lincoln Park and 750 West John Carpenter Freeway assets during the year ended December 31, 2024, as compared to the same period in the prior year.

NOI decreased primarily due to the expiration of the lease associated with the sole tenant at 501 West Church.

The entire building has been re-leased to another tenant;

however, the new lease is not expected to commence until late 2025.

NOI increased due to several leases commencing at our Galleria on the Park and Glenridge Highlands projects during the year ended December 31, 2025 as compared to the same period in the prior year.

NOI increased primarily due to the commencement of the Travel and Leisure lease at the 501 West Church project, as well several leases commencing at The Exchange project and the CNL Center I and II project during the year ended December 31, 2025 as compared to the same period in the prior year.

Northern Virginia/Washington, D.C.

NOI decreased primarily due to the termination of two leases at the Arlington Gateway project during the year ended December 31, 2024, as compared to the same period in the prior year.

NOI decreased primarily due to the expiration of the leases associated with the sole tenants at two projects:

9320 Excelsior Boulevard and Meridian.

Both projects have been designated as redevelopment assets during the year ended December 31, 2024.

NOI increased during the year ended December 31, 2024 as compared to the prior year due to a tenant's expansion at our Wayside Office Park project in the latter half of 2023.

NOI decreased primarily due to the expiration or downsizing of certain tenants at our 1201 & 1225 Eye Street project, our 4250 North Fairfax Drive project, and our Arlington Gateway project during the year ended December 31, 2025 as compared to the same period in the prior year.

NOI decreased primarily due to sale of the 80 and 90 Central project during the year ended December 31, 2025 as compared to the same period in the prior year.

Index to Financial Statements

Funds From Operations ("FFO"), Core Funds From Operations ("Core FFO"), and Adjusted Funds From Operations (“AFFO”)

Net income/(loss) calculated in accordance with GAAP is the starting point for calculating FFO, Core FFO, and AFFO.

These metrics are non-GAAP financial measures and should not be viewed as an alternative measurement of our operating performance to net income/(loss).

Net loss calculated in accordance with GAAP is the starting point for calculating FFO, Core FFO, and AFFO.

These metrics are non-GAAP financial measures and should not be viewed as an alternative measurement of our operating performance to net loss.

Management believes that accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time.

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We calculate FFO in accordance with the current National Association of Real Estate Investment Trusts ("NAREIT") definition.

NAREIT currently defines FFO as Net income/(loss) (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets, goodwill, and investment in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, along with appropriate adjustments to those reconciling items for joint ventures, if any.

NAREIT currently defines FFO as Net loss (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets, goodwill, and investment in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, along with appropriate adjustments to those reconciling items for joint ventures, if any.

Other REITs may not define FFO in accordance with the NAREIT definition, or may interpret the current NAREIT definition differently than we do;

therefore, our computation of FFO may not be comparable to the computation made by other REITs.

We calculate Core FFO by starting with FFO, as defined by NAREIT, and adjusting for gains or losses on the early extinguishment of swaps and/or debt and any significant non-recurring or infrequent items.

Core FFO is a non-GAAP financial measure and should not be viewed as an alternative to net income/(loss) calculated in accordance with GAAP as a measurement of our operating performance.

We calculate Core FFO by starting with FFO, as defined by NAREIT, and adjusting for gains or losses on the early extinguishment of debt and any significant non-recurring or infrequent items.

Core FFO is a non-GAAP financial measure and should not be viewed as an alternative to net loss calculated in accordance with GAAP as a measurement of our operating performance.

We believe that Core FFO is helpful to investors as a supplemental performance measure because it excludes the effects of certain infrequent or non-recurring items which can create significant earnings volatility, but which do not directly relate to our core recurring business operations.

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non-real estate depreciation, straight-lined rents and fair value lease adjustments, non-cash components of interest expense and compensation expense, and by making similar adjustments for joint ventures, if any.

AFFO is a non-GAAP financial measure and should not be viewed as an alternative to net income/(loss) calculated in accordance with GAAP as a measurement of our operating performance.

AFFO is a non-GAAP financial measure and should not be viewed as an alternative to net loss calculated in accordance with GAAP as a measurement of our operating performance.

We believe that AFFO is helpful to investors as a meaningful supplemental comparative performance measure of our ability to make incremental capital investments in new properties or enhancements to existing properties that improve revenue growth potential.

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Index to Financial Statements

Reconciliations of net income/(loss) to FFO, Core FFO, and AFFO for the years ended December 31, 2024, 2023, and 2022, respectively, are presented below (in thousands except per share amounts):

Reconciliations of net loss to FFO, Core FFO, and AFFO for the years ended December 31, 2025, 2024, and 2023, respectively, are presented below (in thousands except per share amounts):

2025 2024 2023

GAAP net income/(loss) applicable to common stock $ (79,069) $ (48,387) $ 146,830

GAAP net loss applicable to common stock $ (83,620) $ (79,069) $ (48,387)

Depreciation of real assets

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— 33,832 29,446

Loss/(gain) on sale of real estate assets

(Gain)/loss on sale of real estate assets

(2,013) 445 (1,946)

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Loss on early extinguishment of debt

37,788 386 820

Core FFO applicable to common stock

$ 177,735 $ 185,567 $ 215,219

Amortization of debt issuance costs, fair market adjustments on notes payable, and discounts on debt

Amortization of debt issuance costs and discounts on debt

6,189 5,142 5,442

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Weighted-average shares outstanding – diluted (2)

126,139 124,926 123,702

NAREIT FFO per share (diluted) $ 1.11 $ 1.44 $ 1.73

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(2) Includes potential dilution under the treasury stock method that would occur if our remaining unvested and potential stock awards vested and resulted in additional common shares outstanding.

Such shares are not included when calculating net loss per share applicable to Piedmont for the years ended December 31, 2024 and 2023 as they would reduce the loss per share presented.

(3) Core FFO was $1.49 per diluted share for the year ended December 31, 2024, as compared to $1.74 per diluted share for the year ended December 31, 2023.

Approximately $0.17 of the decrease is due to increased interest expense, net of interest income, with the remaining decrease attributable to a combination of the sale of two properties during 2024, as well as downtime between the expiration of a few large leases during the year ended December 31, 2024, before newly executed leases commence.

Such shares are not included when calculating net loss per share applicable to Piedmont for the three years ended December 31, 2025 as they would reduce the loss per share presented.

NAREIT FFO applicable to common stock was $1.11 per diluted share for the year ended December 31, 2025, as compared to $1.44 per diluted share for the same period in the prior year due to the recognition of loss on early extinguishment of debt associated with debt retired during the current period, increased interest expense, net of interest income, recognized during the current year as compared to the year ended December 31, 2024, as well as the sale of four projects subsequent to January 1, 2024.

Core FFO applicable to common stock was $1.41 per diluted share for the year ended December 31, 2025, as compared to $1.49 per diluted share for the same period in the prior year.

The decrease is due to increased interest expense, net of interest income, in the current year as compared to the year ended December 31, 2024, as well as the sale of four projects subsequent to January 1, 2024.

Index to Financial Statements

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Property Net Operating Income ("Property NOI") is a non-GAAP measure which we use to assess our operating results.

We calculate Property NOI beginning with Net income/(loss) (calculated in accordance with GAAP) before adjusting for interest, depreciation and amortization and removing any impairments and gains or losses from sales of property and other significant infrequent items that create volatility within our earnings and make it difficult to determine the earnings generated by our core ongoing business.

Furthermore, we remove general and administrative expenses, income associated with property management performed by us for other organizations, and other income or expense items, such as interest income from loan investments.

For Property NOI (cash basis), the effects of the reversal of the non-cash general reserve for uncollectible accounts, straight-lined rents and fair value lease revenue are also eliminated;

We calculate Property NOI beginning with Net loss (calculated in accordance with GAAP) before adjusting for interest, depreciation and amortization and removing any impairments and gains or losses from sales of property and other significant infrequent items that create volatility within our earnings and make it difficult to determine the earnings generated by our core ongoing business.

Furthermore, we remove general and administrative expenses, income associated with property management performed by us for other organizations, and other income or expense items.

For Property NOI (cash basis), straight-lined rents and fair value lease revenue are also eliminated;

while such effects are not adjusted in calculating Property NOI (accrual basis).

Property NOI is a non-GAAP financial measure and should not be viewed as an alternative to net income/(loss) calculated in accordance with GAAP as a measurement of our operating performance.

Property NOI is a non-GAAP financial measure and should not be viewed as an alternative to net loss calculated in accordance with GAAP as a measurement of our operating performance.

We believe that Property NOI, on either a cash or accrual basis, is helpful to investors as a supplemental comparative performance measure of income generated by our properties alone without our administrative overhead.

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and (ii) that were not out of service for development or redevelopment during those periods.

Same Store NOI, on either a cash or accrual basis, is a non-GAAP financial measure and should not be viewed as an alternative to net income/(loss) calculated in accordance with GAAP as a measurement of our operating performance.

Same Store NOI, on either a cash or accrual basis, is a non-GAAP financial measure and should not be viewed as an alternative to net loss calculated in accordance with GAAP as a measurement of our operating performance.

We believe that Same Store NOI is helpful to investors as a supplemental comparative performance measure of the income generated from the same group of properties from one period to the next.

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Index to Financial Statements

The following table sets forth a reconciliation from net income/(loss) calculated in accordance with GAAP to EBITDAre, Core EBITDA, Property NOI, and Same Store NOI on both a cash and accrual basis, for the years ended December 31, 2024 and 2023, respectively (in thousands):

The following table sets forth a reconciliation from Net loss applicable to Piedmont calculated in accordance with GAAP to EBITDAre, Core EBITDA, Property NOI, and Same Store NOI on both a cash and accrual basis, for the years ended December 31, 2025 and 2024, respectively (in thousands):

Cash Basis Accrual Basis

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(303) (3,915) (303) (3,915)

Reversal of non-cash general reserve for uncollectible accounts — (1,000)

Straight-line rent effects of lease revenue

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EBITDAre is a non-GAAP financial measure and should not be viewed as an alternative to net income calculated in accordance with GAAP as a measurement of our operating performance.

We believe that EBITDAre is helpful to investors as a supplemental performance measure because it provides a metric for understanding our results from ongoing operations without taking into account the effects of non-cash expenses (such as depreciation and amortization) and capitalization and capital structure expenses (such as interest

Index to Financial Statements

expense and taxes).

We also believe that EBITDAre can help facilitate comparisons of operating performance between periods and with other REITs.

However, other REITs may not define EBITDAre in accordance with the NAREIT definition, or may interpret the current NAREIT definition differently than us;

However, other REITs may not define EBITDAre in accordance with the NAREIT definition, or may interpret

Index to Financial Statements

the current NAREIT definition differently than us;

therefore, our computation of EBITDAre may not be comparable to that of such other REITs.

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(3) Presented net of related operating expenses incurred to earn such management fee revenue.

(4) Dispositions include One Lincoln Park in Dallas, Texas, sold in the first quarter of 2024, and 750 West John Carpenter Freeway in Irving, Texas, sold in the third quarter of 2024.

(4) Dispositions include 80 and 90 Central, sold in the second quarter of 2025, 161 Corporate Center, sold in the first quarter of 2025, 750 West John Carpenter Freeway, sold in the third quarter of 2024, and One Lincoln Park, sold in the first quarter of 2024.

(5) Other investments include active or recently completed out-of-service redevelopment projects and land.

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The leased percentage of our in-service portfolio increased to 89.6% leased as of December 31, 2025, from 88.4% leased as of December 31, 2024.

During the year ended December 31, 2024, we completed approximately 2.4 million square feet of leasing, including approximately a million square feet of new tenant leases which contributed to the increase in our in-service leased percentage as compared to December 31, 2023.

As of December 31, 2024, scheduled lease expirations for the portfolio for the next twelve months represent less than 9% of our ALR, some portion of which have already renewed.

During the year ended December 31, 2025, we completed approximately 2.5 million square feet of leasing, including approximately 1.7 million square feet of new tenant leases, which contributed to the increase in our in-service leased percentage as compared to December 31, 2024.

As of December 31, 2025, scheduled lease expirations for 2026 represented less than 10% of our Annualized Lease Revenue.

To the extent the square footage from new leases for currently vacant space in our in-service portfolio exceeds or falls short of the square footage associated with non-renewing expirations, such leases would increase or decrease our in-service leased percentage, respectively.

As of December 31, 2025, three projects, 222 South Orange Avenue in Orlando, Florida, and 9320 Excelsior Boulevard and Meridian, both in suburban Minneapolis, Minnesota, were classified as out of service as they undergo redevelopment.

Collectively, these out of service projects were approximately 62% leased as of December 31, 2025.

Impact of Downtime, Abatement Periods, and Rental Rate Changes

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The downtime between a lease expiration and the new lease's commencement can negatively impact Property NOI and Same Store NOI comparisons (both accrual and cash basis).

In addition, office leases for both new and renewing tenants often contain upfront rental and/or operating expense abatement periods which delay the cash flow benefits of the lease even after the new or renewed lease has commenced, negatively impacting Property NOI and Same Store NOI on a cash basis until such abatements expire.

As of December 31, 2024, we had approximately 1.4 million square feet of executed leases for vacant space yet to commence or under rental abatement, representing approximately $46 million of future additional annual cash rents.

In addition, office leases for both new and renewing tenants often contain upfront rental and/or operating expense abatement periods which may delay the cash flow benefits of the lease even after the new or renewed lease has commenced, negatively impacting Property NOI and Same Store NOI on a cash basis until such abatements expire.

As of December 31, 2025, we had approximately 1.1 million square feet of executed leases for vacant space that are yet to commence representing approximately $46 million of future additional annual cash rents, and approximately 0.8 million square feet of executed leases currently under rental abatement, representing approximately $22 million of future additional annual cash rents.

If we are unable to replace expiring leases with new or renewal leases at rental rates equal to or greater than the expiring rates, rental rate roll-downs could occur and negatively impact Property NOI and Same Store NOI comparisons.

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If we fail to qualify as a REIT in any taxable year, we may be subject to federal income taxes on our taxable income for that year and for the four years following the year during which qualification is lost and/or penalties, unless the IRS grants us relief under certain statutory provisions.

Such an event could materially adversely affect our net income/(loss) and net cash available for distribution to our stockholders.

Such an event could materially adversely affect our net loss and net cash available for distribution to our stockholders.

However, we believe that we are organized and operate in such a manner as to qualify for treatment as a REIT and intend to continue to operate in the foreseeable future in such a manner that we will remain qualified as a REIT for federal income tax purposes.

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Index to Financial Statements

misstatement of the carrying value of our real estate and related intangible assets and our reported net income/(loss) attributable to Piedmont.

misstatement of the carrying value of our real estate and related intangible assets and our reported net loss attributable to Piedmont.

Valuation of Goodwill

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We also make estimates about future market rental income amounts subsequent to the expiration of current lease agreements, property operating expenses, and the number of months it takes to re-lease the property, among other factors.

The changing of these assumptions and the subjectivity of the market based assumptions used in the discounted future cash flow analysis, particularly the capitalization rates and discount rates, could result in a changed assessment or an incorrect assessment of the reporting unit’s estimated fair value and, therefore, could result in the misstatement of the carrying value of our reporting units and related goodwill and our reported net income/(loss) attributable to Piedmont.

In addition, adverse economic conditions could also cause us to recognize additional asset impairment charges in the future, which could materially and adversely affect our business, financial condition and results of operations.

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

What changed 10-K

Item 7. Management’s Discussion and Analysis