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Item 2. Management’s Discussion and Analysis

2024-11-04 compared with 2024-08-06 · 81 added, 59 removed, 250 unchanged (36% of the section changed)

49 unchanged sentences

We conduct our business through a traditional UPREIT structure in which our properties are owned by our Operating Partnership directly or through limited partnerships, limited liability companies or other subsidiaries.

During the six months ended June 30, 2024, we acquired 99 properties leased to the USPS for approximately $47.7 million, including closing costs.

As of June 30, 2024, our portfolio consists of 1,607 owned properties, located in 49 states and one territory and comprising approximately 6.2 million net leasable interior square feet.

During the nine months ended September 30, 2024, we acquired 134 properties leased to the USPS for approximately $61.4 million, including closing costs.

As of September 30, 2024, our portfolio consists of 1,642

owned properties, located in 49 states and one territory and comprising approximately 6.3 million net leasable interior square feet.

We are the sole general partner of our Operating Partnership through which our properties are directly or indirectly owned.

As of August 2, 2024, we owned approximately 79.4% of outstanding common units of limited partnership interest in our Operating Partnership (the “OP Units”), including long term incentive units of our Operating Partnership (the “LTIP Units”).

As of November 4, 2024, we owned approximately 79.1% of outstanding common units of limited partnership interest in our Operating Partnership (the “OP Units”), including long term incentive units of our Operating Partnership (the “LTIP Units”).

Our Board of Directors oversees our business and affairs.

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On August 8, 2023, we amended the ATM Program to increase the aggregate offering amount under the program from up to $50.0 million to up to $150.0 million.

During the six months ended June 30, 2024, 634,080 shares were issued under the ATM Program for approximately $9.0 million in gross proceeds.

As of June 30, 2024, we had approximately $105.0 million of availability remaining under the ATM Program.

During the nine months ended September 30, 2024, 1,235,346 shares were issued under the ATM Program for approximately $17.7 million in gross proceeds.

As of September 30, 2024, we had approximately $96.4 million of availability remaining under the ATM Program.

Executive Overview

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Geographic Concentration

As of June 30, 2024, we owned a portfolio of 1,607 properties located in 49 states and one territory and leased primarily to the USPS.

For the six months ended June 30, 2024, approximately 12.2% of our total rental income was concentrated in Pennsylvania.

As of September 30, 2024, we owned a portfolio of 1,642 properties located in 49 states and one territory and leased primarily to the USPS.

For the nine months ended September 30, 2024, approximately 12.2% of our total rental income was concentrated in Pennsylvania.

Emerging Growth Company

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Spodek and his affiliates pursuant to the management agreements and is a percentage of the lease revenue for the managed properties, (ii) revenue our TRS received from providing advisory services to third-party owners of postal properties and (iii) income recognized from properties accounted for as financing leases.

As of June 30, 2024, properties leased to our tenants had an average remaining lease term of approximately three years.

As of September 30, 2024, properties leased to our tenants had an average remaining lease term of approximately three years.

Factors that could affect our rental income and fee and other in the future include, but are not limited to:

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the cost of periodic repair, age and durability of our properties, renovation costs, landlord’s responsibilities under the leases, the cost of re-leasing space, inflation and the potential for liability under applicable laws.

Recoveries from the tenant are recognized as revenue on an accrual basis over the periods in which the related expenditures are incurred.

Recoveries from the tenant are recognized

as revenue on an accrual basis over the periods in which the related expenditures are incurred.

Tenant reimbursements and the related property operating expenses are recognized on a gross basis, because (i) generally, we are the primary obligor with respect to the real estate taxes and (ii) we bear the credit risk in the event the tenant does not reimburse the real estate taxes.

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Equity-Based Compensation Expense

All equity-based compensation expense is recognized in our Consolidated Statements of Operations and Comprehensive Income as components of general and administrative expense and property operating expenses.

All equity-based compensation expense is recognized in our Consolidated Statements of Operations and Comprehensive (Loss) Income as components of general and administrative expense and property operating expenses.

We issue share-based awards to align our directors' and employees’ interests with those of our investors.

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Our credit facilities (the "Credit Facilities") consist of a $150.0 million senior unsecured revolving credit facility (the "Revolving Credit Facility"), a $75.0 million senior unsecured term loan facility (the "2021 Term Loan") and a $125.0 million senior unsecured term loan facility (the "2022 Term Loan").

On October 25, 2024, we amended the Credit Facilities (the "Third Amendment") to, among other things, replaces the Bank of Montreal with Truist Bank as the administrative agent, letter of credit issuer and swingline lender.

In addition, the third amendment increases the 2022 Term Loan commitments in an aggregate principal amount of up to $50.0 million in which we further exercised $40.0 million under the 2022 Term Loan, and on a delayed-draw basis, $10.0 million.

We intend to use the Credit Facilities for working capital purposes, which may include repayment of mortgage indebtedness, property acquisitions and other general corporate purposes.

We amortize on a non-cash basis the deferred financing costs associated with our debt to interest expense using the straight-line method, which approximates the effective interest rate method over the terms of the related loans.

Debt discounts represent fair value adjustments to account for the difference between the stated rates and market rates of debt assumed or entered in connection with our property acquisitions.

The debt premiums discounts are amortized to interest expense over the term of the related loans using the straight-line method, which approximates the effective-interest rate method.

Any changes to the debt structure, including debt financing associated with property acquisitions, could materially influence the operating results depending on the terms of any such indebtedness.

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Lease Renewal

As of July 29, 2024, the leases at 83 of our properties, representing approximately 701,000 net leasable interior square feet, had expired and the USPS was occupying such properties as a holdover tenant.

As of November 4, 2024, the leases at 17 of our properties, representing approximately 500,000 net leasable interior square feet, had expired and the USPS was occupying such properties as a holdover tenant.

As of the date of this report, the USPS had not vacated or notified us of its intention to vacate any of these properties.

When a lease expires, the USPS becomes a holdover tenant on a month-to-month basis typically paying the greater of estimated market rent or the rent amount under the expired lease.

When a lease expires, the USPS becomes

a holdover tenant on a month-to-month basis typically paying the greater of estimated market rent or the rent amount under the expired lease.

While we currently anticipate that we will renew the leases that have expired or will expire, there can be no guarantee that we will be successful in renewing these leases, obtaining positive rent renewal spreads or renewing the leases on terms comparable to those of the expiring leases.

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Results of Operations

Comparison of the Three Months Ended June 30, 2024 and the Three Months Ended June 30, 2023

Comparison of the Three Months Ended September 30, 2024 and the Three Months Ended September 30, 2023

For the Three Months Ended

September 30,

(Amounts in thousands) 2024 2023 $ Change % Change

6 unchanged sentences

General and administrative 3,884 3,352 532 15.9 %

Casualty and impairment losses, net 216 — 216 N/A

Depreciation and amortization 5,756 4,919 837 17.0 %

5 unchanged sentences

Write-off and amortization of deferred financing fees (180) (174) (6) 3.4 %

Interest income 5 1 4 400.0 %

Interest income 7 — 7 N/A

Total interest expense, net (3,419) (2,620) (799) 30.5 %

5 unchanged sentences

Rental income – Rental income includes net rental income as well as the recovery of certain operating costs and property taxes from tenants.

Rental income increased by $2.6 million to $17.4 million for the three months ended June 30, 2024 from $14.8 million for the three months ended June 30, 2023, primarily due to the volume of our acquisitions.

Rental income increased by $3.4 million to $18.8 million for the three months ended September 30, 2024 from $15.4 million for the three months ended September 30, 2023, primarily due to the volume of our acquisitions.

Fee and other – Fee and other revenue increased by $0.2 million to $0.9 million for the three months ended September 30, 2024 from $0.7 million for the three months ended September 30, 2023, primarily due to an increase in income received from advisory services and an increase in management fees.

Operating Expenses

Real estate taxes – Real estate taxes increased by $0.4 million to $2.4 million for the three months ended June 30, 2024 from $2.0 million for the three months ended June 30, 2023, primarily due to the volume of our acquisitions.

Property operating expenses – Property operating expenses increased by $0.7 million to $2.1 million for the three months ended June 30, 2024 from $1.4 million for the three months ended June 30, 2023.

Property management expenses are included within property operating expenses and increased by $0.2 million to $0.7 million for the three months ended June 30, 2024 from $0.5 million for the three months ended June 30, 2023.

The remainder of the increase in property operating expenses of $0.5 million was related to an increase in insurance and repairs and maintenance expenses.

General and administrative – General and administrative expenses increased by $0.3 million to $3.9 million for the three months ended June 30, 2024 from $3.6 million for the three months ended June 30, 2023, primarily due to an increase in net compensation costs, partially offset by a decrease in public company-related expenses.

Depreciation and amortization – Depreciation and amortization expense increased by $0.7 million to $5.5 million for the three months ended June 30, 2024 from $4.8 million for three months ended June 30, 2023, primarily due to the volume of our acquisitions.

Real estate taxes – Real estate taxes increased by $0.4 million to $2.5 million for the three months ended September 30, 2024 from $2.1 million for the three months ended September 30, 2023, primarily due to the volume of our acquisitions.

Property operating expenses – Property operating expenses increased by $0.6 million to $2.5 million for the three months ended September 30, 2024 from $1.9 million for the three months ended September 30, 2023.

Property management expenses are included within property operating expenses and increased by $0.1 million to $0.7 million for the three months ended September 30, 2024 from $0.6 million for the three months ended September 30, 2023.

The remainder of the increase in property operating expenses of $0.5 million was related to an increase in insurance and repair and maintenance expenses.

General and administrative – General and administrative expenses increased by $0.5 million to $3.9 million for the three months ended September 30, 2024 from $3.4 million for the three months ended September 30, 2023, primarily due to an increase in net compensation costs, partially offset by a decrease in public company-related expenses.

Casualty and impairment losses - Casualty and impairment losses for the three months ended September 30, 2024 was $0.2 million which reflects a casualty loss of $0.2 million for an asset damaged as a result of vandalism.

No casualty and impairment losses occurred for the three months ended September 30, 2023.

Depreciation and amortization – Depreciation and amortization expense increased by $0.9 million to $5.8 million for the three months ended September 30, 2024 from $4.9 million for three months ended September 30, 2023, primarily due to the volume of our acquisitions.

Other income primarily includes insurance recoveries related to property damage claims.

Other income decreased by $0.1 million to $0.02 million for the three months ended June 30, 2024 from $0.1 million for the three months ended June 30, 2023, primarily due to a decrease in property related insurance recoveries from claims.

Other income decreased by $0.2 million to $0.01 million for the three months ended September 30, 2024 from $0.2 million for the three months ended September 30, 2023, primarily due to a decrease in property related insurance recoveries from claims.

Total Interest Expense, Net

During the three months ended June 30, 2024, we incurred total interest expense, net of $3.1 million compared to $2.5 million for the three months ended June 30, 2023.

During the three months ended September 30, 2024, we incurred total interest expense, net of $3.4 million compared to $2.6 million for the three months ended September 30, 2023.

The increase in interest expense was primarily due to additional borrowings under the Credit Facilities and increased interest rates.

Comparison of the Six Months Ended June 30, 2024 and Six Months Ended June 30, 2023

For the Six Months Ended

Comparison of the Nine Months Ended September 30, 2024 and Nine Months Ended September 30, 2023

For the Nine Months Ended

September 30,

2024 2023 $ Change % Change

6 unchanged sentences

General and administrative 12,094 11,121 973 8.7 %

Casualty and impairment losses, net 216 — 216 N/A

Depreciation and amortization 16,575 14,537 2,038 14.0 %

11 unchanged sentences

Rental income – Rental income includes net rental income as well as the recovery of certain operating costs and property taxes from tenants.

Rental income increased by $4.7 million to $34.0 million for the six months ended June 30, 2024 from $29.3 million for the six months ended June 30, 2023, primarily due to the volume of our acquisitions.

Rental income increased by $8.0 million to $52.7 million for the nine months ended September 30, 2024 from $44.7 million for the nine months ended September 30, 2023, primarily due to the volume of our acquisitions.

Fee and other – Fee and other revenue increased by $0.3 million to $2.3 million for the nine months ended September 30, 2024 from $2.0 million for the nine months ended September 30, 2024, primarily due to an increase in income received from advisory services and an increase in management fees.

Operating Expense

Real estate taxes – Real estate taxes increased by $0.7 million to $4.7 million for the six months ended June 30, 2024 from $4.0 million for the six months ended June 30, 2023, primarily due to the volume of our acquisitions.

Property operating expenses – Property operating expenses increased by $1.4 million to $4.5 million for the six months ended June 30, 2024 from $3.0 million for the six months ended June 30, 2023.

Property management expenses are included within property operating expenses and increased by $0.3 million to $1.6 million for the six months ended June 30, 2024 from $1.3 million for the six months ended June 30, 2023.

Real estate taxes – Real estate taxes increased by $1.1 million to $7.2 million for the nine months ended September 30, 2024 from $6.1 million for the nine months ended September 30, 2023, primarily due to the volume of our acquisitions.

Property operating expenses – Property operating expenses increased by $2.0 million to $7.0 million for the nine months ended September 30, 2024 from $5.0 million for the nine months ended September 30, 2023.

Property management expenses are included within property operating expenses and increased by $0.4 million to $2.3 million for the nine months ended September 30, 2024 from $1.9 million for the nine months ended September 30, 2023.

The remainder of the increase of $1.7 million is related to expenses for repairs and maintenance and insurance, which increase is due to the volume of our acquisitions.

General and administrative – General and administrative expenses increased by $0.4 million to $8.2 million for the six months ended June 30, 2024 from $7.8 million for the six months ended June 30, 2023 primarily due to an increase in net compensation costs, partially offset by a decrease in public company-related expenses.

Depreciation and amortization – Depreciation and amortization expense increased by $1.2 million to $10.8 million for the six months ended June 30, 2024 from $9.6 million for the six months ended June 30, 2023, primarily due to the volume of our acquisitions.

General and administrative – General and administrative expenses increased by $1.0 million to $12.1 million for the nine months ended September 30, 2024 from $11.1 million for the nine months ended September 30, 2023 primarily due to an increase in net compensation costs, partially offset by a decrease in public company-related expenses.

Casualty and impairment losses - Casualty and impairment losses for the nine months ended September 30, 2024 was $0.2 million which reflects a casualty loss of $0.2 million for an asset damaged as a result of vandalism.

No casualty and impairment losses occurred for the nine months ended September 30, 2023.

Depreciation and amortization – Depreciation and amortization expense increased by $2.1 million to $16.6 million for the nine months ended September 30, 2024 from $14.5 million for the nine months ended September 30, 2023, primarily due to the volume of our acquisitions.

Other income primarily includes insurance recoveries related to property damage claims.

Other income decreased by $0.2 million to $0.1 million for the six months ended June 30, 2024 from $0.2 million for the six months ended June 30, 2023, primarily due to lower insurance recoveries.

Other income decreased by $0.4 million to $0.1 million for the nine months ended September 30, 2024 from $0.5 million for the nine months ended September 30, 2023, primarily due to lower insurance recoveries.

Total Interest Expense, Net

During the six months ended June 30, 2024, we incurred total interest expense, net of $5.9 million compared to $4.7 million for the six months ended June 30, 2023.

During the nine months ended September 30, 2024, we incurred total interest expense, net of $9.3 million compared to $7.3 million for the nine months ended September 30, 2023.

The increase in interest expense is primarily related due to additional borrowings under the Credit Facilities and increased interest rates.

Comparison of the Six Months Ended June 30, 2024 and the Six Months Ended June 30, 2023

We had $1.7 million of cash and $0.9 million of escrows and reserves as of June 30, 2024 compared to $2.2 million of cash and $0.8 million of escrows and reserves as of June 30, 2023.

Cash flows from operating activities – Net cash provided by operating activities increased by $1.7 million to $16.3 million for the six months ended June 30, 2024 compared to $14.6 million for the same period in 2023.

Comparison of the Nine Months Ended September 30, 2024 and the Nine Months Ended September 30, 2023

We had $1.0 million of cash and $0.5 million of escrows and reserves as of September 30, 2024 compared to $2.5 million of cash and $0.4 million of escrows and reserves as of September 30, 2023.

Cash flows from operating activities – Net cash provided by operating activities increased by $3.0 million to $24.3 million for the nine months ended September 30, 2024 compared to $21.3 million for the same period in 2023.

The increase is primarily due to the volume our acquisitions, all of which have generated additional rental income and related changes in working capital, as well as the timing of certain receivables and payables.

Cash flows used in investing activities – Net cash used in investing activities for the six months ended June 30, 2024 primarily consisted of $41.8 million of acquisitions and $1.9 million of escrow deposits for acquisitions , capital improvements and other investing activities.

Net cash used in investing activities for the six months ended June 30, 2023 primarily consisted of $32.9 million of acquisitions and $1.2 million of escrow deposits for acquisitions, capital improvements and other investing activities.

Cash flows from financing activities – Net cash provided by financing activities increased by $6.7 million to $27.1 million for the six months ended June 30, 2024 compared to $20.4 million for the six months ended June 30, 2023.

The increase was primarily related to an increase in net proceeds received from issuance of shares during the same period and increased borrowings under the Revolving Credit Facility;

partially offset by an increase in the payment of dividends and distributions during the six months ended June 30, 2024.

Cash flows used in investing activities – Net cash used in investing activities for the nine months ended September 30, 2024 primarily consisted of $53.2 million of acquisitions and $2.7 million of escrow deposits for acquisitions, capital improvements and other investing activities.

Net cash used in investing activities for the nine months ended September 30, 2023 primarily consisted of $54.9 million of acquisitions and $2.4 million of escrow deposits for acquisitions, capital improvements and other investing activities.

Cash flows from financing activities – Net cash provided by financing activities decreased by $6.2 million to $30.2 million for the nine months ended September 30, 2024 compared to $36.4 million for the nine months ended September 30, 2023.

The decrease was primarily related to a decrease in net proceeds received from issuance of shares during the same period partially offset by an increase in the payment of dividends and distributions during the nine months ended September 30, 2024.

Liquidity and Capital Resources

We had approximately $1.7 million of cash and $0.9 million of escrows and reserves as of June 30, 2024.

We had approximately $1.0 million of cash and $0.5 million of escrows and reserves as of September 30, 2024.

Revolving Credit Facility and Term Loans

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Additional participants in the Credit Facilities include Stifel Bank & Trust and TriState Capital Bank.

As of June 30, 2024, we had $242.0 million of aggregate principal amount outstanding under our Credit Facilities, with $75.0 million drawn on the 2021 Term Loan, $125.0 million drawn on the 2022 Term Loan and $42.0 million drawn on the Revolving Credit Facility.

On October 25, 2024, we entered into the Third Amendment, replacing Bank of Montreal as the administrative agent with Truist Bank and further exercised $40.0 million of term loan accordion under the 2022 Term Loan and, on a delayed-draw basis, $10.0 million of 2022 Term Loan.

As of September 30, 2024, we had $244.0 million of aggregate principal amount outstanding under our Credit Facilities, with $75.0 million drawn on the 2021 Term Loan, $125.0 million drawn on the 2022 Term Loan and $44.0 million drawn on the Revolving Credit Facility.

The Credit Facilities include an accordion feature which permit us to borrow up to an additional $150.0 million under the Revolving Credit Facility subject to customary terms and conditions.

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The Credit Facilities also contain certain customary events of default, including the failure to make timely payments under the Credit Facilities, any event or condition that makes other material indebtedness due prior to its scheduled maturity, the failure to satisfy certain covenants and specified events of bankruptcy and insolvency.

As of June 30, 2024, we were in compliance with all of the Credit Facilities’ debt covenants.

As of June 30, 2024, we had seven interest rate swaps with a total notional amount of $200.0 million that are used to manage our interest rate risk and fix the SOFR component on the Term Loans of the Credit Facilities (together, the "Interest Rate Swaps").

As of September 30, 2024, we were in compliance with all of the Credit Facilities’ debt covenants.

As of September 30, 2024, we had seven interest rate swaps with a total notional amount of $200.0 million that are used to manage our interest rate risk and fix the SOFR component on the Term Loans of the Credit Facilities (together, the "Interest Rate Swaps").

Derivatives and Hedging Activities in the Notes to our unaudited Consolidated Financial Statements included under Item 1 herein for further details regarding the Interest Rate Swaps.

On October 25, 2024, in connection with the exercise of $40.0 million term loan accordion under the 2022 Term Loan, we further entered into an interest rate swap that effectively fixed the interest rate on the additional $40.0 million of the 2022 Term Loan through February 2028 at 5.3705%.

Capital Resources and Financing Strategy

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We believe we have access to multiple sources of capital to fund our long-term liquidity requirements, including the incurrence of additional debt and the issuance of additional equity securities.

However, in the future, there may be a number of

factors that could have a material and adverse effect on our ability to access these capital sources, including unfavorable conditions in the overall equity and credit markets, our degree of leverage, our unencumbered asset base, borrowing restrictions imposed by our lenders, general market conditions for REITs, our operating performance, liquidity and market perceptions about us.

However, in the future, there may be a number of factors that could have a material and adverse effect on our ability to access these capital sources, including unfavorable conditions in the overall equity and credit markets, our degree of leverage, our unencumbered asset base, borrowing restrictions imposed by our lenders, general market conditions for REITs, our operating performance, liquidity and market perceptions about us.

The success of our business strategy will depend, to a significant degree, on our ability to access these various capital sources.

In addition, we continuously evaluate possible acquisitions of postal properties, which largely depend on, among other things, the market for owning and leasing postal properties and the terms on which the USPS will enter into new or renewed leases.

In addition, we continuously evaluate possible acquisitions of postal properties, which largely depend on, among other

things, the market for owning and leasing postal properties and the terms on which the USPS will enter into new or renewed leases.

To maintain our qualification as a REIT, we must make distributions to our stockholders aggregating annually at least 90% of our REIT taxable income determined without regard to the deduction for dividends paid and excluding capital gains.

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Consolidated Indebtedness

As of June 30, 2024, we had approximately $274.9 million of outstanding consolidated principal indebtedness.

The following table sets forth information as of June 30, 2024 with respect to our outstanding indebtedness (in thousands):

Balance as of June 30, 2024

Rate at June 30, 2024

As of September 30, 2024, we had approximately $278.3 million of outstanding consolidated principal indebtedness.

The following table sets forth information as of September 30, 2024 with respect to our outstanding indebtedness (in thousands):

Balance as of September 30, 2024

Rate at September 30, 2024

Revolving Credit Facility (1)

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30,225 2.80 % January 2031

Seller Financing - 2024 (8)

1,400 5.00 % September 2039

Total Principal $ 278,281

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(1) See above under "— Revolving Credit Facility and Term Loans " for details regarding the Credit Facilities.

During the three and six months ended June 30, 2024, we incurred $0.06 million and $0.1 million of unused facility fees related to the Revolving Credit Facility, respectively.

During the three and nine months ended September 30, 2024, we incurred $0.05 million and $0.2 million of unused facility fees related to the Revolving Credit Facility, respectively.

(2) Based upon the one-month Adjusted Term SOFR, which is the applicable Term Secured Overnight Financing Rate plus an adjustment of 0.10%, subject to a 0% floor (the “Adjusted Term SOFR”) .

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(5) The loan is collateralized by first mortgage liens on one property and a personal guarantee of payment by Mr.

The loan has a fixed interest rate of 3.69% for the first five years with interest payments only (ending in October 2026), then adjusting every subsequent five-year period thereafter with principal and interest payments to the rate based on the Five-Year Treasury Rate, plus a margin of 2.75%, with a minimum annual rate of 2.75%.

The loan has a fixed interest rate of 3.69% for the first five years with interest payments only (ending in October 2026),

then adjusting every subsequent five-year period thereafter with principal and interest payments to the rate based on the Five-Year Treasury Rate, plus a margin of 2.75%, with a minimum annual rate of 2.75%.

(6) In connection with the acquisition of a property, we obtained seller financing secured by the property in the amount of $0.4 million requiring five annual payments of principal and interest of $0.1 million with the first installment due on January 2, 2021 based on a 6.0% interest rate per annum through January 2, 2025.

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The loan has a fixed interest rate of 2.80% with interest-only payments for the first five years (ending in January 2026) and fixed payments of principal and interest thereafter based on a 30-year amortization schedule.

Secured Borrowings as of June 30, 2024

As of June 30, 2024, we had approximately $32.9 million of secured borrowings outstanding, all of which are currently fixed-rate debt with a weighted average interest rate of 2.88% per annum.

(8) In connection with the acquisition of two properties, we obtained seller financing secured by the properties in the amount of $1.4 million based on a fixed interest rate of 5.00% with interest-only payments through September 1, 2039.

Secured Borrowings as of September 30, 2024

As of September 30, 2024, we had approximately $34.3 million of secured borrowings outstanding, all of which are currently fixed-rate debt with a weighted average interest rate of 2.96% per annum.

To maintain our qualification as a REIT, we are required to pay dividends to stockholders at least equal to 90% of our REIT taxable income determined without regard to the deduction for dividends paid and excluding net capital gains.

During the three and six months ended June 30, 2024, we paid cash dividends of $0.24 and $0.48 per share, respectively.

Our Board of Directors approved, and o n July 23, 2024 , we declared a second quarter 2024 common stock dividend of $0.24 per share, which will be paid on August 30, 2024 to stockholders of record as of August 2, 2024.

During the three and nine months ended September 30, 2024, we paid cash dividends of $0.24 and $0.72 per share, respectively.

Our Board of Directors approved, and o n October 22, 2024 , we declared a third quarter 2024 common stock dividend of $0.24 per share, which will be paid on November 29, 2024 to stockholders of record as of November 4, 2024.

Because most of our leases provide for fixed annual rental payments without annual rent escalations, our rental revenues are fixed while our property operating expenses are subject to inflationary increases.

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Subsequent Real Estate Acquisitions

As of August 6, 2024 and d uring the period s ubsequent to June 30, 2024, we have acquired nine properties in individual or portfolio transactions for an aggregate of approximately $3.4 million, excluding closing costs.

As of November 4, 2024 and d uring the period s ubsequent to September 30, 2024, we have acquired 13 properties in individual or portfolio transactions for an aggregate of approximately $4.2 million, excluding closing costs.

Critical Accounting Estimates

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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-Q

Item 2. Management’s Discussion and Analysis