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Item 7. Management’s Discussion and Analysis

2026-02-11 compared with 2025-02-12 · 110 added, 139 removed, 430 unchanged (37% of the section changed)

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We are a REIT focused on the acquisition, ownership, and operation of industrial properties throughout the United States.

Our platform is designed to (i) identify properties for acquisition that offer relative value across CBRE-EA Tier 1 industrial property

types and tenants through the principled application of our proprietary risk assessment model, (ii) provide growth through sophisticated industrial operation and an attractive opportunity set, and (iii) capitalize our business appropriately given the characteristics of our assets.

Our platform is designed to (i) identify properties for acquisition that offer relative value across CBRE-EA Tier 1 industrial property types and tenants through the principled application of our proprietary risk assessment model, (ii) provide growth through

sophisticated industrial operation and an attractive opportunity set, and (iii) capitalize our business appropriately given the characteristics of our assets.

We are a Maryland corporation and our common stock is publicly traded on the NYSE under the symbol “STAG.”

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A variety of other factors, including those noted below, also affect our future results of operations.

The industrial real estate business is affected by general macro-economic trends including recent changes in interest rates, inflation, and geopolitical tensions.

These factors are key drivers of financial market volatility and raise concerns about a slowing global economy.

gross domestic product (“GDP”) declined during the first two quarters of 2022, real GDP has increased for nine consecutive quarters with the most recent measure showing 3.1% growth in the third quarter of 2024.

Labor conditions are slowing but holding solid with a 4.1% unemployment rate as of December 2024.

The general consensus among economists is low growth in the United States with a continued historically elevated risk of recession.

While the macro-economic conditions will evolve and could result in tighter credit conditions, weakening tenant cash flows, and rising vacancy rates, we believe we will benefit on a relative basis from having a well-diversified portfolio across various markets, tenant industries, and lease terms.

Additionally, we believe that recent moves toward more regional supply chains and geopolitical tensions positively affect U.S.

The industrial real estate business is affected by general macro-economic trends including recent changes in interest rates, inflation, trade policies, fiscal policy, technology (e.g., artificial intelligence), and geopolitical tensions.

These factors are key drivers of financial market and economic volatility.

In 2025, U.S.

real gross domestic product (“GDP”) declined 0.5% in the first quarter before increasing 3.8% and 4.3% in the subsequent two quarters, respectively.

Labor conditions are slowing, with unemployment rising to 4.4% as of December 2025 compared to 4.1% at the end of June 2025.

In the fourth quarter of 2025, following weaker employment data, the Federal Open Market Committee lowered the federal funds rate range twice, in each instance a reduction of 25 basis points, to a target range of 3.50-3.75%.

Currently, the general consensus among economists is a higher risk of recession or stagflation.

While trade policies and macro-economic conditions continue to evolve and could result in tighter credit conditions, weakening tenant cash flows, and rising vacancy rates, we believe we will continue to benefit from having a well-diversified portfolio across various markets, tenant industries, and lease terms.

Additionally, we believe that recent moves toward more regional supply chains and geopolitical tensions have accelerated a number of trends that positively impact U.S.

industrial demand.

However, given the current uncertainty and events discussed above, our acquisition activity slowed since 2022.

We believe that the current economic environment, while volatile, will provide us with an opportunity to demonstrate the diversification of our portfolio.

Specifically, we believe our existing portfolio should benefit from competitive rental rates and strong occupancy.

In addition to our diversified portfolio, we believe that certain characteristics of our business and capital structure should position us well in an uncertain environment, including our minimal floating rate debt exposure (taking into account our hedging activities), strong banking relationships, strong liquidity, and access to capital.

Due to demographic/consumer trends, geopolitical uncertainty and recent legislation supporting U.S.

infrastructure, we expect industrial-specific trends to support stronger long term demand, including:

However, given the current uncertainty and events discussed above, our acquisition activity has continued to slow since 2022 relative to our historical acquisition pace.

Alternatively, demographic/consumer trends, geopolitical uncertainty and recent legislation supporting U.S.

infrastructure may accelerate trends that support stronger long term demand for industrial space, including:

• the continued growth of e-commerce (as compared to the traditional retail store distribution model) and the concomitant demand by e-commerce industry participants for well-located, functional distribution space;

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the shortening and fattening of the supply chain);

• the overall quality of the transportation infrastructure in the United States.

Our portfolio continues to have strong occupancy and benefits from geographic diversity throughout the national industrial market.

Demand across the industrial market is moderating relative to recent peaks.

Vacancy and availability rates, while rising, remain low by historical standards in many markets.

The supply pipeline remains robust, albeit smaller and, in certain market, concentrated in very large warehouses.

Construction starts continue to decline as a result of both moderating demand and volatile capital markets.

The volatile global and U.S.

macro-economic trends could be a notable headwind and could result in relatively less demand for space, increased credit loss, and higher vacancy.

We believe that the diversification of our portfolio by market, tenant industry, and tenant credit will prove to be a strength in this environment.

On October 22, 2024, American Tire Distributors, Inc.

(“ATD”), a tenant that accounts for approximately 1% of our total annualized base rental revenue as of December 31, 2024, voluntarily filed for reorganization under Chapter 11 of the United States Bankruptcy Code.

ATD leases seven buildings from us totaling 840,658 square feet.

Annualized base rental revenue for the seven buildings is approximately $6.1 million as of December 31, 2024.

ATD’s bankruptcy filings indicate an intent to continue operations and to sell its assets to its current lender group.

The contemplated transaction would eliminate a significant amount of debt and should provide the reorganized business with access to new capital.

ATD is current on its rent obligations to us.

While the sale and reorganization may not be successful and pursuant to the sale and reorganization ATD could assume or reject any or all of the seven leases (including after closing of the sale of ATD to its lenders), we do not currently believe that the tenant’s bankruptcy is reasonably likely to have a material adverse effect on our results of operations or financial condition.

• the general quality of the transportation infrastructure in the United States.

Overall, demand across the industrial market is moderating relative to recent peaks.

Vacancy and availability rates are near historical standards in many markets.

The supply pipeline remains active, albeit with lower volume and more notably concentrated in build-to-suits as speculative construction remains low due to moderating demand and volatile capital markets.

Our portfolio is diversified across geographies, tenant industries and lease terms.

We believe that the current economic environment, while volatile, provides us with an opportunity to demonstrate the strength of our portfolio arising from its diversification.

Specifically, we believe our portfolio should benefit from competitive rental rates and strong occupancy.

Conditions in Our Markets

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(2) Represents the total rental concessions for the entire lease term.

Additionally, for the year ended December 31, 2024, leases related to the Value Add Portfolio and first generation leasing, with a total of 622,332 square feet, are excluded from the Operating Portfolio statistics above.

Additionally, for the year ended December 31, 2025, leases related to the Value Add Portfolio and first generation leasing, with a total of approximately 2.1 million square feet, are excluded from the Operating Portfolio statistics above.

Property Operating Expenses

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However, we also have modified gross leases and gross leases, as well as leases with expense caps, in our building portfolio, which may require us to absorb certain building related expenses of our tenants.

In our modified gross leases, we are responsible for certain building related expenses during the lease term, but most of the expenses are passed through to the tenant for reimbursement to us.

In our modified gross leases, we are responsible for certain building related expenses during the lease term, but most of the expenses are passed

through to the tenant for reimbursement to us.

In our gross leases, we are responsible for all expenses related to the building and its operation during the lease term.

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Certain estimates, judgments and assumptions are inherently subjective and based on the existing business and market conditions, and are therefore continually evaluated based upon available information and experience.

The following items require significant estimation or judgement.

The following items require significant estimation or judgment.

Purchase Price Accounting

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We have determined that judgments regarding the impairment of tangible and intangible rental property and deferred leasing intangible liabilities represents a critical accounting estimate that has the potential to be material in future periods and has been material in certain periods presented in this Form 10-K.

As discussed below in “Critical Accounting Policies,” we evaluate the carrying value of all tangible and intangible rental property assets and deferred leasing intangible liabilities (collectively, the “property”) held for use for possible impairment when an event or change in circumstance has occurred that indicates their

carrying value may not be recoverable.

The evaluation includes estimating and reviewing anticipated future undiscounted cash flows to be derived from the property.

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Significant renovations and betterments that extend the economic useful lives of assets are capitalized.

We capitalize costs directly and indirectly related to the development, pre-development, redevelopment, or improvement of rental property.

We capitalize costs directly related to the development, pre-development, redevelopment, or improvement of rental property.

Real estate taxes, compensation costs of development personnel, insurance, interest, and other directly related costs during construction periods are capitalized as incurred, with depreciation commencing with the date the property is substantially completed.

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The above and below market lease values are amortized into rental income over the remaining lease term.

The value of in-place lease intangibles and tenant relationships are amortized over the remaining lease term (and expected renewal period of the

respective lease for tenant relationships) as increases to depreciation and amortization expense.

The value of in-place lease intangibles and tenant relationships are amortized over the remaining lease term (and expected renewal period of the respective lease for tenant relationships) as increases to depreciation and amortization expense.

The remaining lease terms are adjusted for bargain renewal options or assumed exercises of early termination options, as applicable.

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In determining the fair value of the debt assumed, we discount the spread between the future contractual interest payments and hypothetical future interest payments on mortgage debt based on a current market rate.

The associated fair market value debt adjustment is amortized through interest expense over the life of the debt on a basis which approximates the effective interest method.

The associated fair market value debt

adjustment is amortized through interest expense over the life of the debt on a basis which approximates the effective interest method.

We evaluate the carrying value of all tangible and intangible rental property assets and deferred leasing intangible liabilities (collectively, the “property”) held for use for possible impairment when an event or change in circumstance has occurred that indicates their carrying value may not be recoverable.

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For leases in which we are the lessee, we recognize a right-of-use asset and corresponding lease liability on the accompanying Consolidated Balance Sheets equal to the present value of the fixed lease payments.

In determining operating right-of-use asset

and lease liability for our operating leases, we estimate an appropriate incremental borrowing rate on a fully-collateralized basis for the terms of the leases.

In determining operating right-of-use asset and lease liability for our operating leases, we estimate an appropriate incremental borrowing rate on a fully-collateralized basis for the terms of the leases.

We utilize a market-based approach to estimate the incremental borrowing rate for each individual lease.

Since the terms under our ground leases are significantly longer than the terms of borrowings available to us on a fully-collateralized basis, the estimate of this rate requires significant judgment, and considers factors such as yields on outstanding public debt and other market based pricing on longer duration financing instruments.

The excess of the cost of an acquired business over the net of the amounts assigned to assets acquired (including identified intangible assets) and liabilities assumed is recorded as goodwill.

As of December 31, 2024, our goodwill of approximately $4.9 million represents amounts allocated to the assembled workforce from the acquired management company, and is presented in prepaid expenses and other assets on the accompanying Consolidated Balance Sheets.

Our goodwill has an indeterminate life and is not amortized, but is tested for impairment on an annual basis at December 31, or more frequently if events or changes in circumstances indicate that the asset might be impaired.

We take a qualitative approach to consider whether an impairment of goodwill exists prior to quantitatively determining the fair value of the reporting unit in step one of the impairment test.

We have recorded no impairments to goodwill as of December 31, 2024.

Use of Derivative Financial Instruments

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The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether we have elected to designate a derivative in a hedging relationship and apply hedge accounting, and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting.

Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges.

Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an

asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges.

Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges.

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We measure equity-based compensation expense based on the fair value of the awards on the grant date and recognize the expense ratably over the vesting period, and forfeitures are recognized in the period in which they occur.

On January 7, 2021, we adopted the STAG Industrial, Inc.

Employee Retirement Vesting Program (the “Vesting Program”) to provide supplemental retirement benefits for eligible employees.

For those employees who are retirement eligible or will become retirement eligible during the applicable vesting period under the terms of the Vesting Program, we accelerate equity-based compensation through the employee’s six-month retirement notification period or retirement eligibility date, respectively.

We provide supplemental retirement benefits for eligible employees.

For those employees who are retirement eligible or will become retirement eligible during the applicable vesting period, we accelerate equity-based compensation through the employee’s six-month retirement notification period or retirement eligibility date, respectively.

Revenue Recognition

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In order to determine whether the leased space is substantially complete and ready for its intended use, we determine whether we or the tenant own the tenant improvements.

When it is determined that we are the owner of the tenant improvements, rental income recognition begins when the tenant takes possession of or controls the physical use of the finished space, which is generally when our owned tenant improvements are completed.

are completed.

In instances when it is determined that the tenant is the owner of tenant improvements, rental income recognition begins when the tenant takes possession of or controls the physical use of the leased space.

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(1) For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see “Non-GAAP Financial Measures” below.

Net income for our total portfolio decreased by approximately $3.9 million or 2.0% to approximately $193.3 million for the year ended December 31, 2024 compared to approximately $197.2 million for the year ended December 31, 2023.

Net income for our total portfolio increased by approximately $86.0 million or 44.5% to approximately $279.3 million for the year ended December 31, 2025 compared to approximately $193.3 million for the year ended December 31, 2024.

Same Store Total Operating Revenue

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This increase was partially offset by the reduction of base rent of approximately $6.4 million due to tenant vacancies and a net increase in the amortization of net above market leases of approximately $0.4 million.

Additionally, there was a decrease in same store lease income of approximately $3.1 million which was primarily attributable to management’s evaluation of operating leases to determine the probability of collecting substantially all of the lessee’s remaining lease payments under the lease term.

For those leases that are not probable of collection, we convert to the cash basis of accounting.

During the year ended December 31, 2024, management determined certain leases should be converted from the accrual basis of accounting to the cash basis of accounting, which accounts for an approximately $1.3 million decrease during the year ended December 31, 2024 as compared to the year ended December 31, 2023.

Additionally, management converted certain leases from the cash basis of accounting back to the accrual basis of accounting during the year ended December 31, 2023, for which approximately $1.8 million of straight-line accrued rental balance was reinstated.

Same store other billings increased approximately $4.0 million or 2.9% to approximately $139.6 million for the year ended December 31, 2025 compared to approximately $135.6 million for the year ended December 31, 2024.

The increase was attributable to an increase of approximately $5.3 million in other expense reimbursements which was primarily due to an increase in corresponding expenses.

The increase was also attributable to an increase of approximately $2.9 million of real estate tax reimbursements due to an increase in real estate taxes levied by the taxing authority for certain tenants for which we pay the real estate taxes on their behalf, changes to lease terms where we began paying the real estate taxes on behalf of tenants that had previously paid the taxes directly to the taxing authorities, and occupancy of previously vacant buildings.

The increase was attributable to an increase of approximately $3.3 million in expense reimbursements which was primarily due to an increase in corresponding expenses, as well as an increase in real estate tax reimbursements of approximately $0.7 million due to an increase in real estate taxes levied by the taxing authority and vacancy of previously occupied buildings.

Same Store Operating Expenses

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Total same store operating expenses increased approximately $7.4 million or 5.2% to approximately $150.6 million for the year ended December 31, 2025 compared to approximately $143.3 million for the year ended December 31, 2024.

This increase was due to increases in real estate tax, other, insurance, repairs and maintenance, and snow removal expenses of approximately $3.4 million, $1.3 million, $0.9 million, $0.7 million, and $0.7 million, respectively.

These increases were partially offset by a reduction of utilities expense of approximately $0.3 million.

This increase was due to increases in, repairs and maintenance, real estate tax expense, snow removal expense, utility expense, and other expenses of approximately $2.6 million, $2.4 million, $1.4 million, $0.6 million, and $0.9 million, respectively.

These increases were partially offset by a reduction of insurance expense of approximately $0.6 million.

Acquisitions and Dispositions Net Operating Income

For a detailed reconciliation of our acquisitions and dispositions NOI to net income, see the table above.

Subsequent to January 1, 2023, we acquired 39 buildings consisting of approximately 6.7 million square feet (excluding nine buildings that were included in the Value Add Portfolio at December 31, 2024 or transferred from the Value Add Portfolio to the Operating Portfolio after January 1, 2023), and sold 20 buildings consisting of approximately 3.7 million square feet.

the years ended December 31, 2024 and December 31, 2023, the buildings acquired after January 1, 2023 contributed approximately $27.1 million and $3.2 million to NOI, respectively.

Subsequent to January 1, 2024, we acquired 43 buildings consisting of approximately 9.4 million square feet (excluding two buildings that were included in the Value Add Portfolio at December 31, 2025 or transferred from the Value Add Portfolio to the Operating Portfolio after January 1, 2024), and sold 21 buildings consisting of approximately 3.8 million square feet.

For the years ended December 31, 2025 and December 31, 2024, the buildings acquired after January 1, 2024 contributed approximately $54.1 million and $16.5 million to NOI, respectively.

For the years ended December 31, 2025 and December 31, 2024, the buildings sold after January 1, 2024 contributed approximately $4.4 million and $9.8 million to NOI, respectively.

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Total other expenses increased approximately $6.8 million or 2.0% for the year ended December 31, 2025 to approximately $356.4 million compared to approximately $349.6 million for the year ended December 31, 2024.

This increase was primarily attributable to an increase in depreciation and amortization of approximately $14.6 million due to an increase in the depreciable asset base from net acquisitions after December 31, 2023.

Additionally, a loss on impairment of approximately $5.0 million was recognized during the year ended December 31, 2024, as discussed in Note 3 of the accompanying Notes to Consolidated Financial Statements, that did not occur during the year ended December 31, 2023.

Additionally, general and administrative expenses increased by approximately $1.7 million primarily due to increases in compensation and other payroll costs.

These increases were partially offset by a decrease in other expenses of approximately $2.4 million, which was primarily attributed to the relinquishment of an acquisition deposit of approximately $2.5 million related to the termination of an acquisition contract during the year ended December 31, 2023 that did not recur during the year ended December 31, 2024.

The increase was primarily attributable to an increase in depreciation and amortization of approximately $8.7 million due to an increase in the depreciable asset base from net acquisitions and completed development projects placed into service after December 31, 2024.

Additionally, there was an increase in general and administrative expenses by approximately $2.7 million, primarily due to increases in compensation and other payroll costs.

These increases were partially offset by a reduction in loss on impairment of approximately $4.1 million from the year ended December 31, 2025 compared to the year ended December 31, 2024, as discussed in Note 3 of the accompanying Notes to Consolidated Financial Statements.

Total Other Income (Expense)

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Interest expense includes interest incurred during the period as well as adjustments related to amortization of financing fees and debt issuance costs, and amortization of fair market value adjustments associated with the assumption of debt.

Total other expense increased approximately $29.3 million or 72.5% to approximately $69.7 million for the year ended December 31, 2024 compared to approximately $40.4 million for the year ended December 31, 2023.

This increase was primarily a result of a decrease in the gain on the sales of rental property, net of approximately $21.8 million.

This increase was also attributable to an increase in interest expense of approximately $18.6 million which was primarily attributable to the issuance of $450.0 million of unsecured notes on May 28, 2024, as discussed in Note 4 of the accompanying Notes to Consolidated Financial Statements.

This increase was also attributable to an increase in debt extinguishment and modification expenses of approximately $0.7 million related to the unsecured term loan amendment and the 2024 Credit Agreement (as defined below) amendment during the year ended December 31, 2024, as discussed in Note 4 of the accompanying Notes to Consolidated Financial Statements.

These increases were partially offset by an increase in gain on involuntary conversion of approximately $11.8 million during the year ended December 31, 2024, as discussed in Note 3 of the accompanying Notes to Consolidated Financial Statements, that did not occur during the year ended December 31, 2023.

Total other expense decreased approximately $32.0 million or 46.0% to approximately $37.7 million for the year ended December 31, 2025 compared to approximately $69.7 million for the year ended December 31, 2024.

The decrease was primarily a result of an increase in the gain on the sales of rental property, net of approximately $61.5 million.

This was partially offset by an increase in interest expense of approximately $19.0 million which was primarily attributable to the issuance of $450.0 million of unsecured notes on May 28, 2024 and the issuance of $550.0 million of unsecured notes on June 25, 2025, as discussed in Note 4 of the accompanying Notes to Consolidated Financial Statements.

Additionally, there was a decrease in gain on involuntary conversion of approximately $10.0 million as discussed in Note 3 of the accompanying Notes to Consolidated Financial Statements and an increase in debt extinguishment and modification expenses of approximately $0.8 million related to the amendment to the $300.0 million Unsecured Term Loan G on September 15, 2025, as discussed in Note 4 of the accompanying Notes to Consolidated Financial Statements.

Non-GAAP Financial Measures

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Net cash used in investing activities $ 497,302 $ 731,058 $ (233,756) (32.0) %

Net cash provided by (used in) financing activities $ 286,291 $ (75,667) $ 361,958 478.4 %

Net cash provided by financing activities $ 97,404 $ 286,291 $ (188,887) (66.0) %

Net cash provided by operating activities increased approximately $3.1 million to approximately $463.4 million for the year ended December 31, 2025, compared to approximately $460.3 million for the year ended December 31, 2024.

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These increases were partially offset by the loss of cash flows from property dispositions completed after December 31, 2024 and fluctuations in working capital due to timing of payments and rental receipts.

Net cash used in investing activities increased approximately $410.7 million to approximately $731.1 million for the year ended December 31, 2024, compared to approximately $320.3 million for the year ended December 31, 2023.

The increase was primarily attributable to the acquisition rental property during the year ended December 31, 2024 of approximately $706.6 million, compared to the acquisition of rental property during the year ended December 31, 2023 of approximately $321.9 million.

Additionally, there was an increase in cash paid for additions of land and building and improvements related to development and other capital expenditures of approximately $42.6 million during the year ended December 31, 2024 compared to the year ended December 31, 2023.

These increases were partially offset by an increase in proceeds from sales of rental property, net of approximately $20.9 million during the year ended December 31, 2024 compared to the year ended December 31, 2023.

Net cash provided by (used in) financing activities increased approximately $362.0 million to approximately $286.3 million net cash provided by financing activities for the year ended December 31, 2024, compared to approximately $75.7 million net cash used in financing activities for the year ended December 31, 2023.

This increase was primarily attributable to the issuance of $450.0 million of unsecured notes on May 28, 2024, as discussed in Note 4 in the accompanying Notes to Consolidated Financial Statements.

Additionally there was an increase of approximately $97.8 million in proceeds from sales of common stock, net during the year ended December 31, 2024 compared to the year ended December 31, 2023.

The increase was also attributable to the redemption of $100.0 million of unsecured notes on January 5, 2023 compared to the redemption of $50.0 million of unsecured notes on October 1, 2024.

These increases were partially offset by a decrease in net borrowings of approximately $220.0 million under our unsecured credit facility and an increase of approximately $7.4 million in dividends and distributions paid during the year ended December 31, 2024 compared to the year ended December 31, 2023.

Additionally, there was an increase of approximately $12.2 million in payments of loan fees and costs during the year ended December 31, 2024 compared to the year ended December 31, 2023, which was primarily attributable to the 2024 Credit Agreement (as

defined below) that was entered into on September 10, 2024, as discussed in Note 4 to the accompanying Notes to Consolidated Financial Statements.

Net cash used in investing activities decreased approximately $233.8 million to approximately $497.3 million for the year ended December 31, 2025, compared to approximately $731.1 million for the year ended December 31, 2024.

The decrease was primarily attributable to the acquisition of rental property during the year ended December 31, 2025 of approximately $456.7 million, compared to the acquisition of rental property during the year ended December 31, 2024 of approximately $706.6 million.

The decrease was also attributable to an increase in proceeds from sales of rental property, net of approximately $37.8 million during the year ended December 31, 2025 compared to the year ended December 31, 2024.

These decreases were partially offset by an increase in cash paid for additions of land and building and improvements related to development and other capital expenditures of approximately $54.1 million during the year ended December 31, 2025 compared to the year ended December 31, 2024.

Net cash provided by financing activities decreased approximately $188.9 million to approximately $97.4 million for the year ended December 31, 2025, compared to approximately $286.3 million for the year ended December 31, 2024.

The decrease was primarily attributable to a decrease in net borrowings of approximately $154.0 million under our unsecured credit facility, a decrease in proceeds from sales of common stock, net, of approximately $10.6 million, and an increase of approximately $9.1 million in dividends and distributions paid during the year ended December 31, 2025 compared to the year ended December 31, 2024.

These decreases were partially offset by a reduction in payments of loan fees and costs of approximately $7.5 million during the year ended December 31, 2025 compared to the year ended December 31, 2024.

Liquidity and Capital Resources

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Unsecured term loans:

Unsecured Term Loan F (5)

200,000 2.96 % March 23, 2029 i

Unsecured Term Loan G 300,000 1.80 % February 5, 2026 i

Unsecured Term Loan A 150,000 2.06 % March 15, 2027 i

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Unsecured Term Loan I 187,500 3.41 % January 25, 2028 i

Unsecured Term Loan F (5)

200,000 4.73 % March 23, 2029 i

Unsecured Term Loan G (6)

300,000 1.70 % March 14, 2031 i

Total unsecured term loans 1,025,000

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Unsecured notes:

Series D Unsecured Notes 100,000 4.32 % February 20, 2025 ii

Series G Unsecured Notes 75,000 4.10 % June 13, 2025 ii

Series B Unsecured Notes 50,000 4.98 % July 1, 2026 ii

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Series L Unsecured Notes 175,000 6.05 % May 28, 2029 ii

Series O Unsecured Notes 350,000 5.50 % June 25, 2030 ii

Series M Unsecured Notes 125,000 6.17 % May 28, 2031 ii

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Series K Unsecured Notes 400,000 4.12 % June 28, 2032 ii

Series P Unsecured Notes 100,000 5.82 % June 25, 2033 ii

Series J Unsecured Notes 50,000 2.95 % September 28, 2033 ii

Series N Unsecured Notes 150,000 6.30 % May 28, 2034 ii

Series Q Unsecured Notes 100,000 5.99 % June 25, 2035 ii

Total unsecured notes 1,975,000

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Total mortgage note 4,099

Net unamortized fair market value discount (127)

Unamortized fair market value discount (119)

Total carrying value mortgage note, net 3,980

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(1) Interest rate as of December 31, 2025.

At December 31, 2024, the one-month Term SOFR was 4.33249%.

At December 31, 2025, the one-month Term Secured Overnight Financing Rate (“Term SOFR”) and Daily Secured Overnight Financing Rate (“Daily SOFR”) was 3.688% and 3.870%, respectively.

The current interest rate is not adjusted to include the amortization of deferred financing fees or debt issuance costs incurred in obtaining debt or any unamortized fair market value premiums or discounts.

The spread over the applicable rate for our unsecured credit facility and unsecured term loans is based on our debt rating and leverage ratio, as defined in the respective loan agreements.

(2) Our unsecured credit facility has a stated interest rate of one-month Term SOFR plus a 0.10% adjustment and a spread of 0.775%.

Our unsecured term loans have a stated interest rate of one-month Term SOFR plus a 0.10% adjustment and a spread of 0.85%.

As of December 31, 2024, one-month Term SOFR for the Unsecured Term Loans A, F, G, H, and I was swapped to a fixed rate of 1.31%, 2.11%, 0.95%, 2.50%, and 2.66%, respectively (which includes the 0.10% adjustment).

The Unsecured Term Loan F provides for the election of Daily Simple Secured Overnight Financing Rate (“Daily SOFR”), and effective January 15, 2025, Daily SOFR was swapped to a fixed rate of 3.98%.

(3) Prepayment terms consist of (i) pre-payable with no penalty;

and (ii) pre-payable with penalty.

(2) Our unsecured credit facility has a stated interest rate of one-month Term SOFR plus a spread of 0.775%.

Our Unsecured Term Loans A, G, H, and I have a stated interest rate of one-month Term SOFR plus a spread of 0.85%.

Our Unsecured Term Loan F has a stated interest rate of Daily SOFR plus a spread

All our unsecured term loans have been swapped to a fixed rate, and such fixed rates inclusive of the spreads are presented in the table above.

Effective February 5, 2026, our Unsecured Term Loan G was swapped to a fixed rate inclusive of the spread of 3.94%.

(3) Prepayment terms consist of (i) pre-payable with no penalty, and (ii) pre-payable with penalty.

(4) The capacity of our unsecured credit facility is $1.0 billion.

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Neither extension option is subject to lender consent, assuming proper notice and satisfaction of the conditions.

We are required to pay a facility fee on the aggregate commitment amount (currently $1.0 billion) at a rate per annum of 0.1% to 0.3%, depending on our debt rating, as defined in the 2024 Credit Agreement (as defined below).

We are required to pay a facility fee on the aggregate commitment amount (currently $1.0 billion) at a rate per annum of 0.1% to 0.3%, depending on our debt rating, as defined in the credit agreement.

The facility fee is due and payable quarterly.

(5) The initial maturity date of the Unsecured Term Loan F is March 25, 2027, or such later date which may be extended pursuant to two one-year extension options exercisable by us in our discretion upon advance written notice.

(5) The initial maturity date of our Unsecured Term Loan F is March 25, 2027, or such later date which may be extended pursuant to two one-year extension options exercisable by us in our discretion upon advance written notice.

Exercise of each one-year option is subject to the following conditions:

absence of a default immediately before the extension and immediately after giving effect to the extension;

(i) absence of a default immediately before the extension and immediately after giving effect to the extension;

(ii) accuracy of representations and warranties as of the extension date (both immediately before and after the extension), as if made on the extension date;

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Neither extension option is subject to lender consent, assuming proper notice and satisfaction of the conditions.

(6) The initial maturity date of our Unsecured Term Loan G is March 15, 2030, or such later date which may be extended pursuant to a one-year extension option exercisable by us in our discretion upon advance written notice.

Exercise of the option is subject to the following conditions:

(i) absence of a default immediately before the extension and immediately after giving effect to the extension;

(ii) accuracy of representations and warranties as of the extension date (both immediately before and after the extension), as if made on the extension date;

and (iii) payment of a fee.

The extension option is not subject to lender consent, assuming proper notice and satisfaction of the conditions.

(7) The weighted average interest rate was calculated using the fixed interest rate swapped on the notional amount of $1,025.0 million of debt and is not adjusted to include the amortization of deferred financing fees or debt issuance costs incurred in obtaining debt or any unamortized fair market value premiums or discounts.

The aggregate undrawn nominal commitments on our unsecured credit facility and unsecured term loans as of December 31, 2024 was approximately $586.8 million, including issued letters of credit.

The aggregate undrawn nominal commitments on our unsecured credit facility as of December 31, 2025 was approximately $734.8 million, including issued letters of credit.

Our actual borrowing capacity at any given point in time may be less and is restricted to a maximum amount based on our debt covenant compliance.

On October 1, 2024, we redeemed in full at maturity the $50.0 million in aggregate principal amount of the Series A Unsecured Notes with a fixed interest rate of 4.98%.

On September 10, 2024, we entered into the second amended and restated credit agreement for our unsecured credit facility (the “2024 Credit Agreement”) to, (i) extend the maturity date to September 8, 2028, or such later date which may be extended pursuant to two six-month extension options exercisable by us at our discretion, subject to certain conditions, including the payment of a fee, and (ii) provide that borrowings under our unsecured credit facility will, at our election, bear interest based on a Base Rate, Adjusted Term SOFR or Adjusted Daily Simple SOFR (each as defined in the 2024 Credit Agreement), which interest rate will be increased by 0.10% for any SOFR Loan (as defined in the 2024 Credit Agreement), plus an applicable spread based on our debt rating and leverage ratio (each as defined in the 2024 Credit Agreement).

Other than the increase in the borrowing commitments and the interest rate provisions described above, the material terms of our unsecured credit facility remain unchanged.

On June 29, 2024, the sustainability-related interest rate reduction of 0.02% on our unsecured credit facility and each of our unsecured term loans ended in accordance with the respective loan agreements.

On March 25, 2024, we entered into a second amended and restated term loan agreement for the Unsecured Term Loan F to (i) extend the maturity date to March 25, 2027, with two one-year extension options, subject to certain conditions, that would extend the maturity date to March 23, 2029 if both exercised, and (ii) provide that borrowings under the Unsecured Term Loan F will, at our election, bear interest based on a Base Rate, Adjusted Term SOFR, or Adjusted Daily Simple SOFR (each as defined in the loan agreement), which interest rate will be increased by 0.10% for any SOFR Loan (as defined in the loan agreement), plus an applicable spread based on our debt rating and leverage ratio (each as defined in the loan agreement), less a sustainability-related adjustment.

Other than the maturity and interest rate provisions described above, the material terms remain unchanged.

On March 13, 2024, we entered into a note purchase agreement (the “March 2024 NPA”) for the private placement by the Operating Partnership of $175.0 million senior unsecured notes maturing May 28, 2029, with a fixed annual interest rate of 6.05%, $125.0 million senior unsecured notes maturing May 28, 2031, with a fixed annual interest rate of 6.17%, and $150.0 million senior unsecured notes maturing May 28, 2034, with a fixed annual interest rate of 6.30%.

The March 2024 NPA contains a number of financial covenants substantially similar to the financial covenants contained in our unsecured credit facility and other unsecured notes, plus a financial covenant that requires us to maintain a minimum interest coverage ratio of not less than 1.50:1.00.

On September 15, 2025, we entered into a second amended and restated term loan agreement for our Unsecured Term Loan G to (i) extend the maturity date to March 15, 2030, or such later date which may be extended pursuant to a one-year extension option exercisable by us in our discretion upon advance written notice, subject to certain conditions, including the payment of a fee, (ii) remove the 0.10% interest rate adjustment certain loans, and (iii) provide that borrowings under the Unsecured Term Loan G will, at our election, bear interest based on a Base Rate, Term SOFR, or Daily Simple SOFR (each as defined in the loan agreement), plus an applicable spread based on our debt rating and leverage ratio (each as defined in the loan agreement).

Other than the maturity date and interest rate provisions described above, the material terms of the Unsecured Term Loan G remain unchanged.

On September 15, 2025, we entered into amendments to our Unsecured Credit Facility, Unsecured Term Loan A, Unsecured Term Loan F, Unsecured Term Loan H, and Unsecured Term Loan I to remove the 0.10% interest rate adjustment for certain loans, and in the case of our Unsecured Term Loans A, H, and I, provide that borrowings under the respective term loans will, at our election, bear interest based on a Base Rate, Term SOFR, or Daily Simple SOFR (each as defined in the respective loan agreement).

Other than the interest rate provisions described above, the material terms of our Unsecured Term Loans A, F, H, and I remain unchanged.

On June 13, 2025, we redeemed in full at maturity the $75.0 million in aggregate principal amount of the Series G Unsecured Notes with a fixed interest rate of 4.10%.

On April 15, 2025, we entered into a note purchase agreement for the private placement by the Operating Partnership of $350.0 million of senior unsecured notes (the “Series O Unsecured Notes”) maturing June 25, 2030 with a fixed annual interest rate of 5.50%, $100.0 million of senior unsecured notes (the “Series P Unsecured Notes”) maturing June 25, 2033 with a fixed annual interest rate of 5.82%, and $100.0 million of senior unsecured notes (the “Series Q Unsecured Notes”) maturing June 25, 2035 with a fixed annual interest rate of 5.99%.

On June 25, 2025, Operating Partnership issued the Series O Unsecured Notes, Series P Unsecured Notes, and Series Q Unsecured Notes (collectively, the “2025 Notes”) and received the proceeds therefrom.

The Company and certain wholly owned subsidiaries of the Operating Partnership are guarantors of the unsecured notes.

On May 28, 2024, we issued all of the notes under the March 2024 NPA.

The Operating Partnership offered and sold the 2025 Notes in reliance on the registration exemption provided by Section 4(a)(2) of the Securities Act.

On February 20, 2025, we redeemed in full at maturity the $100.0 million in aggregate principal amount of the Series D Unsecured Notes with a fixed interest rate of 4.32%.

The following table summarizes our debt capital structure as of December 31, 2025.

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Net Debt to Real Estate Cost Basis (1)

(1) “Net Debt” means amounts outstanding under our unsecured credit facility, unsecured term loans, unsecured notes, and mortgage note, less cash and cash equivalents.

“Real Estate Cost Basis” means the book value of rental property and deferred leasing intangibles, exclusive of the related accumulated depreciation and amortization.

(1) We define Net Debt as the outstanding principal balance of the Company’s total debt, less cash and cash equivalents and proceeds from pending reverse Section 1031 like-kind exchanges that are included in restricted cash.

We define Real Estate Cost Basis as the book value of rental property and deferred leasing intangibles, exclusive of the related accumulated depreciation and amortization.

We regularly pursue new financing opportunities to ensure an appropriate balance sheet position.

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Any such guarantees issued by the Company will be full, irrevocable, unconditional, and absolute joint and several guarantees to the holders of each series of such outstanding guaranteed debt securities.

Pursuant to Rule 3-10 of Regulation S-X, subsidiary issuers of obligations guaranteed by the parent are not required to provide separate financial statements, provided that the subsidiary obligor is consolidated into the parent company’s consolidated financial statements, the parent guarantee is “full and unconditional” and, subject to certain exceptions as set forth below, the alternative disclosure required by Rule 13-01 of Regulation S-X is provided, which includes narrative disclosure and summarized financial information.

Pursuant to Rule 3-10 of Regulation S-

X, subsidiary issuers of obligations guaranteed by the parent are not required to provide separate financial statements, provided that the subsidiary obligor is consolidated into the parent company’s consolidated financial statements, the parent guarantee is “full and unconditional” and, subject to certain exceptions as set forth below, the alternative disclosure required by Rule 13-01 of Regulation S-X is provided, which includes narrative disclosure and summarized financial information.

Accordingly, we have not presented separate consolidated financial statements of our Operating Partnership.

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The following table summarizes our ATM common stock offering program as of December 31, 2025.

ATM Common Stock Offering Program Date Maximum Aggregate Offering Price (in thousands) Aggregate Common Stock Available as of December 31, 2024 (in thousands)

ATM Common Stock Offering Program Date Maximum Aggregate Offering Price (in thousands)

2025 $750 million ATM February 13, 2025 $ 750,000

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We may physically settle the applicable forward sale agreements on one or more dates prior to the respective scheduled maturity dates, at which point we would receive the proceeds net of certain costs;

provided, however, we may elect to cash settle or net share settle such forward sale agreements at any time through the respective scheduled maturity dates.

provided, however, we may elect to cash settle or net share settle such forward sale agreements at any time through the respective scheduled maturity dates, which is typically one year from the respective trade dates.

From a forward sale until its settlement, the net proceeds (that is, gross sales proceeds net the sales commission) increase by an interest rate factor, a portion of which is retained by the equity distribution agent, and decrease by borrowing costs incurred and dividends paid on the borrowed shares underlying the forward sale.

Forward Sale Agreements Shares Gross Sales Proceeds

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Net Proceeds Received Per Share

Forward Sale Agreements Outstanding at September 30, 2024 4,228,508 165,841

Outstanding at September 30, 2025 1,300,725 $ 47,771

New forward sale agreements 2,869,013 111,290 $ 38.79 $ 38.41 $ 0.38

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(4,169,738) (159,061) $ 37.75

Forward Sale Agreements Outstanding at December 31, 2024 — $ —

Outstanding at December 31, 2025 — $ —

(1) Upon a forward sale, the equity distribution agent typically earns a sales commission of 1% of the gross sales price.

(2) Reflects amount we received per share upon settlement of the forward sale.

(3) We physically settled outstanding forward equity sale agreements by issuing shares of common stock in exchange for net proceeds of approximately $167.7 million.

(2) We physically settled outstanding forward equity sale agreements by issuing shares of common stock in exchange for net proceeds of approximately $157.4 million during the three months ended December 31, 2025.

Forward Sale Agreements Shares Gross Sales Proceeds

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Net Proceeds Received Per Share

Forward Sale Agreements Outstanding at December 31, 2021 1,200,000 $ 50,243

Forward sale agreements settled (3)

(1,200,000) (50,243) $ 41.39

Forward Sale Agreements Outstanding at December 31, 2022 — —

New forward sale agreements 2,817,993 103,483 $ 36.72 $ 36.36 $ 0.36

Forward sale agreements settled (3)

(1,717,993) (61,683) $ 35.60

Forward Sale Agreements Outstanding at December 31, 2023 1,100,000 41,800

Outstanding at December 31, 2024 — $ —

New forward sale agreements 4,169,738 159,061 $ 38.15 $ 37.77 $ 0.38

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(4,169,738) (159,061) $ 37.75

Forward Sale Agreements Outstanding at December 31, 2024 — $ —

Outstanding at December 31, 2025 — $ —

(1) Upon a forward sale, the equity distribution agent typically earns a sales commission of 1% of the gross sales price.

(2) Reflects amount we received per share upon settlement of the forward sale.

(3) We physically settled outstanding forward equity sale agreements by issuing shares of common stock in exchange for net proceeds of approximately $167.7 million, $61.2 million, and $49.7 million, for the years ended December 31, 2024, 2023, and 2022, respectively.

(2) We physically settled outstanding forward equity sale agreements by issuing shares of common stock in exchange for net proceeds of approximately $157.4 million during the year ended December 31, 2025.

Noncontrolling Interests

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As of December 31, 2025, we owned approximately 98.1% of the common units in our Operating Partnership, and our current and former executive officers, directors, senior employees and their affiliates, and third parties that contributed properties to us in exchange for common units in our Operating Partnership owned the remaining 1.9%.

On December 13, 2024, we formed a joint venture with a third party that is primarily engaged in the development and eventual operation of two industrial real estate properties located in Concord, North Carolina.

At December 31, 2024, we held a 90% interest and the third party held the remaining 10% interest in the joint venture.

On August 8, 2024, we formed a joint venture with a third party that is primarily engaged in the development and eventual operation of an industrial real estate property located in Reno, Nevada.

At December 31, 2024, we held a 95% interest and the third party held the remaining 5% interest in the joint venture.

We also own joint ventures with third parties primarily engaged in the development and eventual operation of industrial real estate properties.

At December 31, 2025, we held a 97.4% interest in a joint venture that owns property in Reno, Nevada, a 94.9% interest in a joint venture that owns property in Concord, North Carolina, and a 96.3% interest in a joint venture that owns property in Shepherdsville, Kentucky.

Interest Rate Risk

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Level 2 financial instruments are defined as significant other observable inputs.

As of December 31, 2024, we had 21 interest rate swaps outstanding that were in an asset position of approximately $36.5 million, including any adjustment for nonperformance risk related to these agreements.

During the year ended December 31, 2024, we entered into four interest rate swaps with an aggregate notional value of $200.0 million which fix Daily SOFR at 3.98% effective January 15, 2025 and mature on March 25, 2027.

As of December 31, 2025, we had 17 interest rate swaps outstanding that were in an asset position of approximately $13.5 million and four interest rate swaps outstanding that were in a liability position of approximately $1.3 million, including any adjustment for nonperformance risk related to these agreements.

During the year ended December 31, 2025, we entered into four interest rate swaps with an aggregate notional value of $300.0 million which fix Daily SOFR at 3.09% effective February 5, 2026 and mature on March 15, 2030, and were designated as cash flow hedges.

As of December 31, 2025, we had approximately $1.3 billion of variable rate debt.

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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