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What changed in Peakstone Realty Trust's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Peakstone Realty Trust's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+421 added−333 removedSource: 10-K (2026-02-18) vs 10-K (2025-02-20)

Top changes in Peakstone Realty Trust's 2025 10-K

421 paragraphs added · 333 removed · 257 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

18 edited+20 added−8 removed16 unchanged
Biggest changeUnder the ADA, all public accommodations and commercial facilities are required to meet certain federal requirements related to access and use by disabled persons. Failing to comply with the ADA, including any requirements for public accommodations and commercial facilities could result in the imposition of fines by the federal government or an award of damages to private litigants.
Biggest changeFailing to comply with the ADA, including any requirements for public accommodations and commercial facilities could result in the imposition of fines by the federal government or an award of damages to private litigants. Through our due diligence process and protections in our leases, we aim to ensure compliance with laws, including the ADA.
Such an event could materially adversely affect net income and net cash available for the payment of dividends to shareholders. As of December 31, 2024, the Company believes it has satisfied the REIT requirements and distributed all of its taxable income. Pursuant to the Code, the Company has elected to treat its corporate subsidiary as a taxable REIT subsidiary (“TRS”).
Such an event could materially adversely affect net income and net cash available for the payment of dividends to shareholders. As of December 31, 2025, the Company believes it has satisfied the REIT requirements and distributed all of its taxable income. Pursuant to the Code, the Company has elected to treat its corporate subsidiary as a taxable REIT subsidiary (“TRS”).
The tax treatment of us, our Operating Partnership, any of our operating subsidiaries we may form and the holders of our shares in local jurisdictions may differ from our U.S. federal income tax treatment. 7 Table of Contents Tax We have elected to be taxed as a REIT under the “Code”, commencing with our tax year ended December 31, 2015.
The tax treatment of us, our Operating Partnership, any of our operating subsidiaries we may form and the holders of our shares in local jurisdictions may differ from our U.S. federal income tax treatment. Tax We have elected to be taxed as a REIT under the “Code”, commencing with our tax year ended December 31, 2015.
We draw from the largest pools of talent to help find the best people for our company. As of December 31, 2024, approximately 53% of our employees were people of color/minorities and approximately 47% were women. In addition, as of December 31, 2024, the majority of our five-member Board of Trustees (the “Board”) was composed of women and/or minorities.
We draw from the largest pools of talent to help find the best people for our company. As of December 31, 2025, approximately 53% of our employees were people of color/minorities and approximately 47% were women. In addition, as of December 31, 2025, the majority of our five-member Board was composed of women and/or minorities.
Although we believe that these costs will not have a material adverse effect on us, if required changes or litigation involve a greater amount of expenditures than we currently anticipate, it could have a material adverse effect on us. Human Capital Management We are internally managed by an experienced team that specializes in industrial and office properties.
Although we believe that these costs will not have a material adverse effect on us, if required changes or litigation involve a greater amount of expenditures than we currently anticipate, it could have a material adverse effect on us. 10 Table of C ontents Human Capital Management We are internally managed by an experienced team that specializes in industrial properties.
As of December 31, 2024, we employed 38 people. We believe our employees are our greatest asset. Because of this perspective, we have implemented several programs to foster their professional growth and their growth as global citizens.
As of December 31, 2025, we employed 40 people. We believe our employees are our greatest asset. Because of this perspective, we have implemented several programs to foster their professional growth and their growth as global citizens.
However, we cannot assure our shareholders that this will always be the case, or that these requirements will not be changed or that new requirements will not be imposed which would require significant unanticipated expenditures by us, all of which could have a material adverse effect on us.
However, we cannot assure our shareholders that these requirements will not be changed or that new requirements will not be imposed, which would require significant unanticipated expenditures by us and could have a material adverse effect on us.
If we or our subsidiaries fail to maintain an exception or exemption from the 1940 Act, we may be required to, among other things, substantially change the manner in which we conduct our operations to avoid being required to register as an investment company under the 1940 Act or register as an investment company under the 1940 Act. 8 Table of Contents Americans with Disabilities Act We are subject to the Americans with Disabilities Act of 1990 (the “ADA”).
If we or our subsidiaries fail to maintain an exception or exemption from the 1940 Act, we may be required to, among other things, substantially change the manner in which we conduct our operations to avoid being required to register as an investment company under the 1940 Act or register as an investment company under the 1940 Act.
Through our due diligence process and protections in our leases, we aim to ensure compliance with laws, including the ADA. However we cannot assure our shareholders that this will always be the case when we acquire properties, and we may incur additional costs to comply with the ADA or other regulations related to access by disabled persons.
However we cannot assure our shareholders that this will always be the case when we acquire properties, and we may incur additional costs to comply with the ADA or other regulations related to access by disabled persons.
Changes in these laws and regulations, or their interpretation by agencies and courts, occur frequently. We and any of our operating subsidiaries that we may form may be subject to state and local tax in states and localities in which they or we do business or own property.
We and any of our operating subsidiaries that we may form may be subject to state and local tax in states and localities in which they or we do business or own property.
Through our due diligence process, and protections in our leases, we aim to own and operate properties that are in material compliance with all such regulatory requirements, including all zoning, occupancy and land use requirements.
Among other things, these restrictions may relate to fire and safety, seismic or hazardous material abatement requirements. Through our due diligence process and protections in our leases, we aim to own and operate properties that are in material compliance with all such regulatory requirements, including all zoning, occupancy and land use requirements.
Environmental Matters Under various federal, state and local laws, ordinances and regulations, a current or previous owner or operator of real property may be held liable for the costs of removing or remediating hazardous or toxic substances.
Environmental Matters Under various federal, state and local laws, ordinances and regulations, a current or former owner or operator of real property may be held liable for the performance of or costs of removing or remediating hazardous substances or wastes. These laws often impose strict, joint and several clean-up responsibility and liability, without regard to causation.
There are numerous public and private real estate investors, developers, and financial institutions, some of which have greater financial or other resources than we do, that compete with us for acquisition, disposition, and investment opportunities. Regulatory Matters Overview Our business is subject to many laws and governmental regulations.
We compete against owners and managers of competing properties in leasing space to prospective tenants and in re-leasing space to existing tenants. There are numerous public and private real estate investors, developers, and financial institutions, some of which have greater financial or other resources than we do, that compete with us for acquisition, disposition, and investment opportunities.
Other Regulations The properties we own and operate generally are subject to various federal, state and local regulatory requirements, such as zoning, occupancy and land use regulations and state and local fire and life safety requirements.
Other Regulations The properties we own and operate generally are subject to various federal, state and local regulatory requirements, such as zoning, occupancy and land use regulations and state and local fire and life safety requirements. Failure to comply with these requirements could result in the imposition of fines by governmental authorities or an award of damages to private litigants.
The costs of investigating, removing or remediating these substances may be substantial, and the presence of these substances may adversely affect our ability to lease or sell the property or to borrow using the property as collateral and may expose us to liability resulting from any release of or exposure to these substances.
The presence of these hazardous substances or wastes may adversely affect our ability to use, lease or sell the property, or to borrow using the property as collateral, and may expose us to liability resulting from a release of or exposure to these hazardous substances or wastes, any of which could result in expenditures and could have a material adverse effect on us.
We maintain pollution liability insurance for all of our properties to insure against the potential liability of remediation and exposure risk; however, in certain cases, pre-existing conditions may be excluded coverage. Also, numerous states and municipalities have adopted laws and policies on climate change and emission reduction targets.
We maintain pollution legal liability insurance for all of our properties including coverage for cleanup costs, bodily injury and property damage from new and pre-existing conditions, however, some pre-existing conditions and some activities and uses may be excluded from coverage for certain properties. Various states and municipalities have adopted laws and policies on climate change and emission reduction targets.
PKST OP, L.P., our operating partnership (the “Operating Partnership”), owns, directly and indirectly all of the Company’s assets. As of December 31, 2024, the Company owned, directly and indirectly through a wholly-owned subsidiary, approximately 93.0% of the outstanding common units of limited partnership interest in the Operating Partnership (“OP Units”).
As of December 31, 2025, the Company owned, directly and indirectly through a wholly-owned subsidiary, approximately 93.2% of the outstanding common units of limited partnership interest in the Operating Partnership (“OP Units”). As of December 31, 2025, our portfolio consisted of 76 industrial properties within one reportable segment (the “Industrial” segment).
We may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from a site that we own or operate.
In addition, we may incur costs and liabilities associated with the transportation, disposal or treatment of hazardous substances or wastes, claims by third parties based on damages resulting from environmental contamination emanating from one of our properties, or liability in connection with the handling or exposure to hazardous substances or wastes.
Removed
Overview Peakstone Realty Trust (NYSE: PKST) is an internally managed real estate investment trust currently shifting its portfolio composition towards industrial properties. PKST’s objective is to grow its portfolio through investments in the industrial outdoor storage (“IOS”) subsector. The Company’s existing portfolio includes high-quality, predominantly single-tenant industrial and office properties located in strategic markets.
Added
Overview Peakstone Realty Trust (NYSE: PKST) is an industrial real estate investment trust (“REIT”), with a strategic focus on growth in the industrial outdoor storage (“IOS”) sector. PKST OP, L.P., our operating partnership (the “Operating Partnership”), owns, directly and indirectly all of the Company’s assets.
Removed
As of December 31, 2024, our portfolio is comprised of 103 properties, consisting of 97 operating properties and six redevelopment properties (those designated for redevelopment or repositioning) reported in two segments - Industrial and Office. Our Business Strategy Our strategic focus is to reposition the portfolio towards industrial assets.
Added
The portfolio included 60 IOS properties and 16 Traditional Industrial properties. IOS properties have a low building-to-land ratio, or low coverage, maximizing yard space for the display, movement and storage of materials and equipment. “Traditional Industrial” properties include distribution, warehouse, and light manufacturing facilities.
Removed
This will be accomplished through the continued divestment of non-core assets and investment in industrial outdoor storage (“IOS”) opportunities. We will maintain a balanced approach to capital allocation, prioritizing investments in the IOS subsector while also optimizing our leverage to support long-term growth. Our goal is to enhance portfolio performance, maximize shareholder value, and ensure financial flexibility for future opportunities.
Added
Of the 76 properties in our portfolio, 72 were operating properties and four were designated for redevelopment or repositioning. During 2025, the Company completed its strategic transformation to an industrial-only REIT through the disposition of all properties in its Office segment. As a result, the Office segment was eliminated as of December 31, 2025.
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Competition The commercial real estate markets in which we operate are highly competitive. We compete against owners and managers of competing properties in leasing space to prospective tenants and in re-leasing space to existing tenants.
Added
As of September 30, 2025, the Company’s plan to dispose of its Office segment properties represented a strategic shift in its business that met the criteria for classification as discontinued operations. Accordingly, as of September 30, 2025, 27 Office segment properties were classified as discontinued operations (the “Office Discontinued Operations Properties”).
Removed
These laws often impose clean-up responsibility and liability without regard to whether the owner or operator was responsible for, or even knew of, the presence of the hazardous or toxic substances.
Added
The Company presented the results of the Office segment through the year ended December 31, 2025, with results attributable to the Office Discontinued Operations Properties presented separately as discontinued operations for all periods presented.
Removed
If we arrange for the disposal or treatment of hazardous or toxic substances at another location, we may be liable for the costs of removing or remediating these substances at the disposal or treatment facility, whether or not the facility is owned or operated by us.
Added
Proposed Mergers On February 2, 2026, we and the Operating Partnership (collectively, the “Company Parties”), BSREP V Neon Pooling REIT L.P., BSREP V Neon Pooling Non-REIT L.P. and BSREP V Brookfield Neon Sub L.P., each a Delaware limited partnership (collectively, “Parent”), Neon REIT Merger Sub LLC, a Delaware limited liability company and a subsidiary of Parent (“REIT Merger Sub”), and Neon OP Merger Sub LLC, a Delaware limited liability company and a subsidiary of Parent (“Operating Merger Sub” and, collectively with REIT Merger Sub and Parent, the “Parent Parties”), entered into an Agreement and Plan of Merger (the “Merger Agreement”).
Removed
Certain environmental laws also impose liability in connection with the handling of or exposure to asbestos-containing materials, pursuant to which third parties may seek recovery from owners or operators of real properties for personal injury associated with asbestos-containing materials and other hazardous or toxic substances.
Added
The Merger Agreement provides that, upon the terms and subject to the conditions set forth therein, (i) Operating Merger Sub will be merged with and into the Operating Partnership, with the Operating Partnership surviving the merger (the “Surviving Partnership” and such merger, the “Partnership Merger”) and (ii) immediately following the consummation of the Partnership Merger, REIT Merger Sub will be merged with and into the Company, with the Company surviving the merger (the “Surviving Entity” and such merger, the “Company Merger” and, together with the Partnership Merger, the “Mergers”).
Removed
Failure to comply with these requirements could result in, among other things, the imposition of fines by governmental authorities or awards of damages to private litigants.
Added
Upon completion of the Company Merger, Parent (or subsidiaries thereof) will be the sole common shareholders of the Surviving Entity, and the Surviving Partnership will be wholly owned by Parent and the Surviving Entity (or subsidiaries thereof).
Added
The Mergers and the other transactions contemplated by the Merger Agreement were unanimously approved and declared advisable by the Board of Trustees (the “Board”) of the Company.
Added
At the effective time of the Company Merger (the “Company Merger Effective Time”), each common share, par value $0.001 per share, of the Company that is issued and outstanding immediately prior to the Company Merger Effective Time will be automatically cancelled and converted into the right to receive an amount in cash equal to $21.00 per share, without interest.
Added
Pursuant to the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Partnership Merger (the “Partnership Merger Effective Time”), each common unit of the Operating Partnership (each, an “Operating Partnership Common Unit”) that is issued and outstanding immediately prior to the Partnership Merger Effective Time will be automatically cancelled and converted into the right to receive an amount in cash equal to the product of (i) the REIT Shares Amount (as defined in the Eighth Amended and Restated Limited Partnership Agreement of the Operating 8 Table of C ontents Partnership, dated as of April 13, 2023, by and between the Company and the limited partners party thereto, as amended, in effect on such date with respect to such Operating Partnership Common Units) multiplied by (ii) $21.00, without interest.
Added
The Merger Agreement contains customary termination rights, including the right of either party to terminate the Merger Agreement if the Mergers have not been completed by 11:59 p.m. (New York City time) on August 2, 2026, or if shareholder approval has not been obtained upon a vote taken at a shareholders meeting or any adjournment or postponement thereof.
Added
In certain specified circumstances further described in the Merger Agreement, in connection with the termination of the Merger Agreement, the Company will be required to pay Parent a termination payment of $16.0 million or $34.0 million, as applicable pursuant to the terms of the Merger Agreement.
Added
The Parent Parties have secured committed financing, consisting of a combination of (i) equity financing to be provided by investment funds affiliated with Parent on the terms and subject to the conditions set forth in an equity commitment letter provided by such funds, and (ii) debt financing to be provided by certain lenders on the terms and subject to the conditions set forth in a debt commitment letter, the aggregate proceeds of which will be sufficient for the Parent Parties to pay all amounts the Parent Parties may be obligated to pay pursuant to the Merger Agreement or the Mergers.
Added
Our Business Strategy Our business strategy is to operate, enhance, and grow our industrial portfolio, with a strategic emphasis on IOS assets. We focus on disciplined capital allocation and financial flexibility. Competition The commercial real estate markets in which we operate are highly competitive.
Added
Regulatory Matters Overview Our business is subject to many laws and governmental regulations. Changes in these laws and regulations, or their interpretation by agencies and courts, occur frequently.
Added
The costs of investigating, removing or remediating these substances or wastes may be substantial, and we may not have sufficient, or any, 9 Table of C ontents insurance to cover such costs.
Added
We may be required to pay the costs of removing or remediating these hazardous substances or wastes from properties we acquire, which may be greater than those initially expected at the time of acquisition, including those conditions that existed prior to our acquisition or where tenants fail to address issues they are contractually obligated to do so.
Added
Americans with Disabilities Act We are subject to the Americans with Disabilities Act of 1990 (the “ADA”). Under the ADA, all public accommodations and commercial facilities are required to meet certain federal requirements related to access and use by disabled persons.
Added
The information found on, or otherwise accessible through, our website is not incorporated by reference into, nor does it form a part of, this report or any other document that we file with the SEC. 11 Table of C ontents

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

133 edited+64 added−25 removed206 unchanged
Biggest changeAdditionally, we may be unable to sell our properties, on favorable terms, or at all; • our properties may be subject to impairment losses; • changes in tax, real estate, environmental or zoning laws and regulations; • delays or difficulties with respect to obtaining, or the inability to obtain, necessary zoning, occupancy, land use and other governmental permits, and changes in zoning and land use laws; • statewide and local changes in zoning and land use laws and state attorney general actions that result in moratoriums on industrial development or materially restrict the size and uses of industrial projects; 17 Table of Contents • changes in zoning, occupancy and land use permissions in connection with re-leasing our properties to new tenants; • unanticipated or increased costs related to the imposition of tariffs; • changes in property tax assessments and insurance costs; • changes in interest rates and inflation; • the cost and availability of credit may be adversely affected by illiquid credit markets and wider credit spreads, and/or more stringent underwriting standards, which could affect our inability or the inability of our tenants to timely refinance maturing liabilities to meet liquidity needs; and we may from time to time be subject to litigation, which may significantly divert the attention and resources of the Company’s management and result in defense costs, settlements, fines or judgments against us, some of which are not, or cannot be, covered by insurance.
Biggest changeIf rental revenues, sales proceeds and/or occupancy levels decline, we generally would expect to have less cash available to pay indebtedness, to pay dividends to shareholders or otherwise run our business; • it may be difficult to lease, buy or sell real estate on favorable terms or at all, 19 Table of C ontents • potential buyers of our properties may experience difficulty in obtaining financing, tenants may be unable to afford rent and credit conditions may be tight, all of which may limit our ability to sell properties promptly, on favorable terms, or at all, or execute on our business plan; • our properties may be subject to impairment losses; • changes in tax, real estate, environmental or zoning laws and regulations; • delays or difficulties with respect to obtaining, or the inability to obtain, necessary zoning, occupancy, land use and other governmental permits, and changes in zoning and land use laws; • statewide and local changes in zoning and land use laws and state attorney general actions that result in moratoriums on industrial development or materially restrict the size and uses of industrial projects; • changes in zoning, occupancy and land use permissions in connection with re-leasing our properties to new tenants; • unanticipated or increased costs related to the imposition of tariffs; • changes in property tax assessments and insurance costs, especially when we cannot pass costs through to our tenants; • changes in interest rates and inflation; • the cost and availability of credit may be adversely affected by illiquid credit markets and wider credit spreads, and/or more stringent underwriting standards, which could affect our inability or the inability of our tenants to timely refinance maturing liabilities to meet liquidity needs; • environmental issues may result in higher costs than expected; and • we may from time to time be subject to litigation, which may significantly divert the attention and resources of the Company’s management and result in defense costs, settlements, fines or judgments against us, some of which are not, or cannot be, covered by insurance.
The incurrence of additional debt could increase our leverage ratios and would increase our exposure to the risks associated with debt financing, all of which would be negatively perceived by the market. In addition, an inability to obtain sufficient capital to meet our funding obligations could lead to contractual defaults that could materially and adversely affect us.
The incurrence of additional debt could increase our leverage ratios and would increase our exposure to the risks associated with debt financing, all of which could be negatively perceived by the market. In addition, an inability to obtain sufficient capital to meet our funding obligations could lead to contractual defaults that could materially and adversely affect us.
Further, the MGCL, applicable through provision in the Maryland REIT Law (the “MRL”), provides that an act of a trustee relating to or affecting an acquisition or investment or a potential acquisition of control of a real estate investment trust may not be subject to a higher duty or greater scrutiny than is applied to any other act of a trustee.
Further, the MGCL, applicable through provision in the Maryland REIT Law (the “MRL”), provides that an act of a trustee relating to or affecting an acquisition or investment or a potential acquisition of control of a Maryland real estate investment trust may not be subject to a higher duty or greater scrutiny than is applied to any other act of a trustee.
Maryland law provides that a trustee has no liability in that capacity if he or she performs his or her duties in good faith, in a manner he or she reasonably believes to be in the real estate investment trust’s best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances.
Maryland law provides that a trustee has no liability in that capacity if he or she performs his or her duties in good faith, in a manner he or she reasonably believes to be in the Maryland real estate investment trust’s best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances.
We also use our own internal processes for monitoring and identifying changes in potential tenant credit risk, which include a routine review of the financial statements (when available) of each tenant and/or its parent companies and guarantors, as applicable, insurance certificates and other documentation required by each lease, public disclosures and market information (e.g., SEC filings, press releases and investor calls) of each tenant and/or its parent companies and guarantors, as applicable, and general market intelligence involving micro-economic and macro-economic conditions that may impact the tenant and/or its parent companies and guarantors, as applicable.
We also use our own internal processes for monitoring and identifying changes in potential tenant credit risk, which include a review of the financial statements (when available) of each tenant and/or its parent companies and guarantors, as applicable, insurance certificates and other documentation required by each lease, public disclosures and market information (e.g., SEC filings, press releases and investor calls) of each tenant and/or its parent companies and guarantors, as applicable, and general market intelligence involving micro-economic and macro-economic conditions that may impact the tenant and/or its parent companies and guarantors, as applicable.
The loss of services of one or more members of our executive leadership team, or our inability to attract and retain highly qualified personnel, could adversely affect our business and weaken our business relationships with lenders, sellers, buyers, companies that may lease or guarantee our properties and other industry participants, any of which could have a material adverse effect on us.
The loss of services of one or more members of our executive leadership team or other key personnel, or our inability to attract and retain highly qualified personnel, could adversely affect our business and weaken our business relationships with lenders, sellers, buyers, companies that may lease or guarantee our properties and other industry participants, any of which could have a material adverse effect on us.
In addition, if we need to repay existing debt during periods of rising interest rates, we could be required to sell one or more of our investments in properties at times that may not permit realization of the maximum return on such investments. Any of the foregoing risks could have a material adverse effect on us.
In addition, if we need to refinance or repay existing debt during periods of rising interest rates, we could be required to sell one or more of our investments in properties at times that may not permit realization of the maximum return on such investments. Any of the foregoing risks could have a material adverse effect on us.
In addition, during periods of high inflation, fixed rental rate increases subject us to the risk of receiving lower rental revenue than we otherwise would have been entitled to receive if the rental rate increases were based on an increase in the consumer price index over a specified period.
During periods of high inflation, fixed rental rate increases subject us to the risk of receiving lower rental revenue than we otherwise would have been entitled to receive if the rental rate increases were based on an increase in the consumer price index over a specified period.
Losing our REIT status would reduce our net earnings available for investment or paying dividends to shareholders because of the additional tax liability. If this occurs, we might be required to borrow funds or sell some investments in order to pay the applicable tax.
Losing our REIT status would materially reduce our net earnings available for investment or paying dividends to shareholders because of the additional tax liability. If this occurs, we might be required to borrow funds or sell some investments in order to pay the applicable tax.
Therefore, if we were to sell any of these assets prior to the favorable re-leasing of the space or without electing to invest additional capital to redevelop a space, we may be forced to re-lease or sell these assets for unfavorable terms and suffer a loss on our investment.
Therefore, if we were to sell any of these assets prior to the favorable re-leasing of the space or without electing to invest additional capital to redevelop a space, we may be forced to re-lease or sell these assets for relatively unfavorable terms and suffer a loss on our investment.
The exercise of an early termination provision typically requires advance notification from the tenant (usually 12 months) and is frequently accompanied by the payment of a termination fee that reimburses us for a portion of the remaining rent under the original lease term.
The exercise of an early termination provision typically requires advance notification from the tenant (usually 6-12 months) and is frequently accompanied by the payment of a termination fee that reimburses us for a portion of the remaining rent under the original lease term.
District Court for the District of Maryland, Baltimore Division, will be the sole and exclusive forum for: (i) any derivative action or proceeding brought in the right or on behalf of the Company, (ii) any action asserting a claim of breach by any trustee, officer, other employee or agent of the Company of a duty owed to the Company or our shareholders, (iii) any action asserting a claim against us or any trustee, officer, other employee or agent of the Company arising pursuant to any provision of the MRL, our declaration of trust or our bylaws, (iv) any action asserting a claim governed by the internal affairs doctrine, or (v) any Internal Corporate Claim (as defined the MGCL).
District Court for the District of Maryland, Baltimore Division, will be the sole and exclusive forum for: (i) any derivative action or proceeding brought in the right or on behalf of the Company, (ii) any action asserting a claim of breach by any trustee, officer, other employee or agent of the Company of a duty owed to the Company or our shareholders, (iii) any action asserting a claim against us or any trustee, officer, other employee or agent of the Company arising pursuant to any provision of the MRL, our declaration of trust or our bylaws, (iv) any action asserting a claim against the Company or any trustee, officer or other employee of the Company that is governed by the internal affairs doctrine, or (v) any Internal Corporate Claim (as defined in the MGCL).
Any failure or perceived failure by us to comply with laws, regulations, policies or regulatory guidance relating to privacy or data security may result in governmental investigations and enforcement actions, litigation, fines and penalties or adverse publicity and could cause our investors to lose trust in us, which could have an adverse effect on our reputation as well as our business, financial condition and results of operations.
Any failure or perceived failure by us to comply with laws, regulations, policies or regulatory guidance relating to privacy or data security may result in governmental investigations and enforcement actions, litigation (including class actions), fines and penalties or adverse publicity and could cause our investors to lose trust in us, which could have an adverse effect on our reputation as well as our business, financial condition and results of operations.
We also cannot be sure that we will receive any rent in the proceeding sufficient to cover our expenses and future income expectations with respect to the premises.
We also cannot be sure that we will receive any rent in any such proceeding sufficient to cover our expenses and future income expectations with respect to the premises.
Alternatively, if a court were to find this provision of our bylaws inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings notwithstanding that the MGCL, applicable through provisions in the MRL, provides that the declaration of trust or 28 Table of Contents bylaws of a Maryland real estate investment trust may require that any internal corporate claim be brought only in courts sitting in one or more specified jurisdictions, we may incur additional costs that we do not currently anticipate associated with resolving such matters in other jurisdictions, which could have a material adverse effect on us.
Alternatively, if a court were to find this provision of our bylaws inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings notwithstanding that the MGCL, applicable through provisions in the MRL, provides that the declaration of trust or bylaws of a Maryland real estate investment trust may require that any internal corporate claim be brought only in courts sitting in one or more specified jurisdictions, we may incur additional costs that we do not currently anticipate associated with resolving such matters in other jurisdictions, which could have a material adverse effect on us.
Certain provisions of the Maryland General Corporation Law (the “MGCL”) that are applicable to Maryland real estate investment trusts may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under circumstances that otherwise could provide the holders of common shares with the opportunity to realize a premium price for our common shares, including: • “business combination” provisions that, subject to limitations, prohibit certain business combinations between a Maryland real estate investment trust and an “interested shareholder” (defined generally as any person who owns, directly or indirectly, 10% or more of the voting power of the Maryland real estate investment trust’s outstanding voting shares of beneficial interest or an affiliate or associate of the Maryland real estate investment trust who was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then-outstanding voting shares of beneficial interest at any time within the two-year period immediately prior to the date in question) or an affiliate of such interested shareholder for five years after the most recent date on which the interested shareholder becomes an interested shareholder, and thereafter impose either fair price or supermajority shareholder voting requirements on these combinations; • “control share” provisions that provide that holders of “control shares” of a Maryland real estate investment trust (defined as shares (other than shares acquired directly from the real estate investment trust) that, when aggregated with other shares controlled by the shareholder, entitle the shareholder to exercise one of three increasing ranges of voting power in electing trustees) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of issued and outstanding “control shares”) have no voting rights with respect to their control shares, except to the extent approved by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares; and 27 Table of Contents • T itle 3, Subtitle 8 of the MGCL, which permits the board of trustees of a Maryland real estate investment trust, without shareholder approval and notwithstanding any contrary provisions in the declaration of trust or bylaws, to implement certain takeover defenses, such as a classified board, some of which we do not yet have.
Certain provisions of the Maryland General Corporation Law (the “MGCL”) that are applicable to Maryland real estate investment trusts may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under circumstances that otherwise could provide the holders of common shares with the opportunity to realize a premium price for our common shares, including: • “business combination” provisions that, subject to limitations, prohibit certain business combinations between a Maryland real estate investment trust and an “interested shareholder” (defined generally as any person who beneficially owns, directly or indirectly, 10% or more of the voting power of the Maryland real estate investment trust’s outstanding voting shares of beneficial interest or an affiliate or associate of the Maryland real estate investment trust who was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then-outstanding voting shares of beneficial interest at any time within the two-year period immediately prior to the date in question) or an affiliate of such interested shareholder for five years after the most recent date on which the interested shareholder becomes an interested shareholder, and thereafter impose either fair price or supermajority shareholder voting requirements on these combinations; • “control share” provisions that provide that holders of “control shares” of a Maryland real estate investment trust (defined as shares (other than shares acquired directly from the Maryland real estate investment trust) that, when aggregated with other shares controlled by the shareholder, entitle the shareholder to exercise or direct the • exercise of voting power, except solely by virtue of a revocable proxy, in electing trustees within one of three increasing ranges of voting power) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of issued and outstanding “control shares”) have no voting rights with respect to their control shares, except to the extent approved by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares; and • T itle 3, Subtitle 8 of the MGCL, which permits the board of trustees of a Maryland real estate investment trust, without shareholder approval and notwithstanding any contrary provisions in the declaration of trust or bylaws, to implement certain takeover defenses, such as a classified board, some of which we do not yet have.
In addition, we may decide not to obtain, even though available, any or adequate earthquake or similar catastrophic insurance coverage because the premiums are too high. Generally, commercial general liability insurance, as well as property insurance covering the building for the full replacement value, is in place for all of our properties.
In addition, we may decide not to obtain, even though available, any or adequate earthquake or similar catastrophic insurance coverage because the premiums are too high. Generally, commercial general liability insurance, as well as property insurance covering the building and improvements for the full replacement value, is in place for all of our properties.
General Risks Cybersecurity risks and cyber incidents or the failure to comply with laws and regulations concerning data privacy and security may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information, and/or damage to our business relationships, any of which could have a material adverse effect on us.
General Risks Cybersecurity risks and cyber incidents or the failure to comply with laws and regulations concerning data privacy and security may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information and information technology systems, and/or damage to our business relationships, any of which could have a material adverse effect on us.
We may own or invest in special use single tenant properties, and, as such, it may be difficult to re-lease or sell these properties, which could have a material adverse effect on us. A number of our assets have special uses. Special use properties may be relatively illiquid compared to other types of real estate and financial assets.
We may own or invest in special use single tenant properties, and, as such, it may be difficult to re-lease or sell these properties, which could have a material adverse effect on us. Some of our assets have special uses. Special use properties may be relatively illiquid compared to other types of real estate and financial assets.
Certain litigation, or the resolution of certain litigation, may affect the availability or cost of some of our insurance coverage, expose us to increased risks that would be uninsured, or adversely impact our ability to attract officers and trustees, each of which may have a material adverse effect on us, as well as divert the attention of management. ITEM 1B.
Certain litigation, or the resolution of certain litigation, may affect the availability or cost of some of our insurance coverage, expose us to increased risks that would be uninsured, or adversely impact our ability to attract officers and trustees, each of which may have a material adverse effect on us, as well as divert the attention of management.
We currently rely on five tenants for approximately a quarter of our revenue and adverse effects to their business, including a tenant’s bankruptcy or insolvency, a general downturn in a tenant’s business, a lease termination or election by a tenant not to renew, or other events affecting our tenants, could have a material adverse effect on us.
We currently rely on five tenants for approximately 40% of our revenue and adverse effects to their business, including a tenant’s bankruptcy or insolvency, a general downturn in a tenant’s business, a lease termination or election by a tenant not to renew, or other events affecting our tenants, could have a material adverse effect on us.
Instead, each of its partners or its member, as applicable, which may include us, will be allocated, and may be required to pay tax with respect to, such partner’s or member’s share of its income. We intend to maintain the status of our Operating Partnership as a partnership for U.S. federal income tax purposes.
Instead, each of its partners or its members, as applicable, which may include us, will be allocated, and may be required to pay tax with respect to, such partner’s or member’s share of its income. We intend to maintain the status of our Operating Partnership as a partnership for U.S. federal income tax purposes.
We depend on current key personnel for our future success, and the loss of such personnel or inability to attract and retain personnel could harm our business and the loss of services of one or more members of our executive management team, or our inability to attract and retain highly qualified personnel, could adversely affect our business, diminish our 15 Table of Contents investment opportunities and weaken our business relationships with lenders, business partners, companies that may lease or guarantee our properties and other industry participants, any of which could have a material adverse effect on us.
We depend on current key personnel for our future success, and the loss of such personnel or inability to attract and retain personnel could harm our business and the loss of services of one or more members of our executive management team, or our inability to attract and retain highly qualified personnel, could adversely affect our business, diminish our investment opportunities and weaken our business relationships with lenders, business partners, companies that may lease or guarantee our properties and other industry participants, any of which could have a material adverse effect on us.
Our indebtedness currently requires us to dedicate a significant portion of our cash flow from operations to debt service payments, which reduces the availability of our cash flow to meet our cash needs, including our underwriting of assets and development and redevelopment costs, or to make the distributions to our shareholders currently contemplated or necessary to continue to qualify as a REIT.
Our indebtedness currently requires us to dedicate a significant portion of our cash flow from operations to debt service payments, which reduces the availability of our cash flow to meet our cash needs, including our development and redevelopment costs, or to make the distributions to our shareholders currently contemplated or necessary to continue to qualify as a REIT.
If the supply of land appropriate for the development of traditional industrial properties and IOS properties becomes more limited, including as a result of rezoning of the land underlying our properties for different uses, the cost of land could increase and/or the number of traditional industrial and IOS properties that we are able to invest in could be reduced.
If the supply of land appropriate for the development of industrial properties becomes more limited, including as a result of rezoning of the land underlying our properties for different uses, the cost of land could increase and/or the number of industrial properties that we are able to invest in could be reduced.
Furthermore, changes to zoning, occupancy and land use regulations may increase the bargaining power of tenants, affecting the terms at which are able to lease our traditional industrial properties and IOS properties. The occurrence of any of the foregoing could have a material adverse effect on us.
Furthermore, changes to zoning, occupancy and land use regulations may increase the bargaining power of tenants, affecting the terms at which are able to lease our industrial properties. The occurrence of any of the foregoing could have a material adverse effect on us.
This could create risks in addition to those we face in more familiar regions, such as our not complying with the applicable rules and regulation in such markets or not sufficiently anticipating conditions or trends in a new market and, therefore a property not operating profitably.
This could create risks in addition to those we face in more familiar regions, such as our not complying with the applicable rules and regulations in such markets or not sufficiently anticipating conditions or trends in a new market and, therefore a property not operating profitably.
In addition, zoning, occupancy and land use regulations may limit our ability to re-lease our properties to different tenants, develop or redevelop our traditional industrial properties and IOS properties, including as a result of the adoption of restrictive zoning, occupancy and land use regulations, exposing us to increased competition for available land and properties.
In addition, zoning, occupancy and land use regulations may limit our ability to re-lease our properties to different tenants, develop or redevelop our industrial properties, including as a result of the adoption of restrictive zoning, occupancy and land use regulations, exposing us to increased competition for available land and properties.
The Code defines “individuals” for purposes of the requirement described in the preceding sentence to include some types of entities. Our declaration of trust authorizes our Board to take such actions as it determines are necessary or appropriate to preserve our qualification as a REIT.
The Code defines “individuals” for purposes of the requirement described in the preceding sentence to include some types of entities. Our declaration of trust authorizes our Board to take such actions as it determines are necessary or advisable to preserve our qualification as a REIT.
Effective internal controls over financial reporting are necessary for us to provide reliable financial reports, effectively prevent fraud and operate successfully. Any failure to provide reliable financial reports or prevent fraud could harm operating results, cause us to fail to meet our reporting obligations or cause reputational harm.
Effective internal controls over financial reporting are essential for us to provide reliable financial reports, effectively prevent fraud and operate successfully. Any failure to provide reliable financial reports or prevent fraud could harm operating results, cause us to fail to meet our reporting obligations or cause reputational harm.
We believe that any disclosure controls and procedures or internal controls over financial reporting, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.
We believe that any disclosure controls and procedures or internal controls over financial reporting, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.
Additionally, we may not be able to successfully implement appropriate operational, financial and management systems and controls to achieve the benefits expected to result from the acquisitions of and/or other investments in properties in new markets and new business lines.
Additionally, we may not be able to successfully implement appropriate operational, financial and management systems and controls to achieve the benefits expected to result from the acquisitions of and/or other investments in properties in new markets.
We may also be subject to state and local taxes on our income or property, either directly, at the level of our Operating Partnership, or at the level of the other companies through which we indirectly own our assets.
We may also be subject to state and local taxes on our income or properties, either directly, at the level of our Operating Partnership, or at the level of the other companies through which we indirectly own our assets.
The market price of our common shares could be subject to wide fluctuations in response to: • our financial performance, cash flows, financial condition, results of operations and prospects, • actual or anticipated differences in our quarterly or annual operating results from those expected; • our dependence on key personnel whose continued services are not guaranteed; • whether we will be successful in renewing leases as they expire; • failure to qualify as a REIT; • failure to comply with the rules of the NYSE, the requirements of the Sarbanes-Oxley Act or other applicable laws; • the annual yield from dividends on our common shares as compared to yields on other financial instruments; • actual or anticipated changes in our and our tenants’ business or prospects; • the current state of the credit and capital markets, and our ability and the ability of our tenants to obtain financing on favorable terms; • whether work-from-home trends or other factors will impact the attractiveness of industrial and/or office assets; • our entry into new business lines; • our ability to execute on the sale of properties; • changes in market valuations of similar companies; • strategic decisions by us or our competitors, such as acquisitions or investments, divestments, spin offs, joint ventures, strategic investments or changes in business strategy; • increases in (or prolonged periods of high) market interest rates, which could result in increased interest expense on our debt; • equity issuances by us (including the issuance of OP Units or other securities convertible into, or exchangeable for, our common shares) or the conversion of a large number of OP Units into common shares as opposed to cash; • future sales of substantial amounts of our common shares by our existing or future shareholders, or the perception that such issuances or future sales may occur; • adverse market reaction to any indebtedness we incur in the future, inability to refinance our existing indebtedness, the inclusion of restrictive covenants in our future indebtedness, or our failure to establish debt levels that investors believe are appropriate; • changes in expectations of future financial performance or changes in estimates of securities analysts; • publication of research reports about us or our industry by securities analysts; • government regulatory action or inaction and legislative changes that could adversely affect our industry; • changes in tax laws; • adverse speculation in the press or investment community; • changes in the underlying value of real estate; • climate change and natural disasters, such as earthquakes, wildfires, rising sea levels, flooding, and extreme weather; • impacts of the outbreak of a highly infectious or contagious disease or declaration of a pandemic, epidemic or other health crises; • terrorist acts, natural or man-made disasters or threatened or actual armed conflicts; and • general market conditions.
The market price of our common shares could be subject to wide fluctuations in response to: • our financial performance, cash flows, financial condition, results of operations and prospects, • actual or anticipated differences in our quarterly or annual operating results from those expected; • our dependence on key personnel whose continued services are not guaranteed; • whether we will be successful in renewing leases as they expire; • failure to qualify as a REIT; • failure to comply with the rules of the SEC, the NYSE, the requirements of the Sarbanes-Oxley Act or other applicable laws; • the annual yield from dividends on our common shares as compared to yields on other financial instruments; • actual or anticipated changes in our and our tenants’ business or prospects; • the current state of the credit and capital markets, and our ability and the ability of our tenants to obtain financing on favorable terms; • our entry into new business lines; • our ability to execute on the sale of properties; • changes in market valuations of similar companies; • strategic decisions by us or our competitors, such as acquisitions or investments, divestments, spin offs, joint ventures, strategic investments or changes in business strategy; • increases in (or prolonged periods of high) market interest rates, which could result in increased interest expense on our debt; • equity issuances by us (including the issuance of OP Units or other securities convertible into, or exchangeable for, our common shares) or the conversion of a large number of OP Units into common shares as opposed to cash; • future sales of substantial amounts of our common shares (including following conversion of OP Units to common shares) by our existing or future shareholders, or the perception that such issuances or future sales may occur; • adverse market reaction to any indebtedness we incur in the future, inability to refinance our existing indebtedness, the inclusion of restrictive covenants in our future indebtedness, or our failure to establish debt levels that investors believe are appropriate; • changes in expectations of future financial performance or changes in estimates of securities analysts; • publication of research reports about us or our industry by securities analysts; • government regulatory action or inaction and legislative changes that could adversely affect our industry; • changes in tax laws; 27 Table of C ontents • adverse speculation in the press or investment community; • changes in the underlying value of real estate; • climate change and natural disasters, such as earthquakes, wildfires, rising sea levels, flooding, and extreme weather; • impacts of the outbreak of a highly infectious or contagious disease or declaration of a pandemic, epidemic or other health crises; • terrorist acts, natural or man-made disasters or threatened or actual armed conflicts; and • general market conditions.
If we are unable to make our debt payments when required, a lender could foreclose on the property or properties securing such debt, which could have a material adverse effect on us. 21 Table of Contents Some of our assets are and will be secured by mortgages on our properties, and we may in the future rely on securitization vehicles.
If we are unable to make our debt payments when required, a lender could foreclose on the property or properties securing such debt, which could have a material adverse effect on us. Some of our assets are and will be secured by mortgages on our properties, and we may in the future rely on securitization vehicles.
In the event of a tenant default, a termination of, or failure to renew a lease, as applicable, we may experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment and re-letting the property and/or experience a decrease in value of a property if we determine to sell such property while it is vacant.
In the event of a tenant default, a termination of, or failure to renew a lease, as applicable, we may experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment and re-letting the property, for expenses relating to the property and/or experience a decrease in value of a property if we determine to sell such property while it is vacant.
Our disclosure controls and procedures are designed to reasonably assure that information required to be disclosed by us in reports we file or submit under the Exchange Act is accumulated and communicated to management, recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC.
Our disclosure controls and procedures are designed to reasonably assure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to management, recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms.
In addition, in the event we determine it is best to sell the property, we may have difficulty selling it to a party other than the company that has leased the property, such company’s 10 Table of Contents parent and/or the company that has guaranteed the lease of the property due to the special purpose for which the property may have been designed.
In addition, in the event we determine it is best to sell the property, we may have difficulty selling it to a party other than the company that has leased the property, such company’s parent and/or the company that has guaranteed the lease of the property due to the special purpose for which the property may have been designed.
The presence of these substances may adversely affect our ability to lease or sell the property or to borrow using the property as collateral and may expose us to liability resulting from any release of or exposure to these substances, any of which could result in expenditures and could have a material adverse effect on us.
The presence of these hazardous substances or wastes may adversely affect our ability to use, lease or sell the property, or to borrow using the property as collateral, and may expose us to liability resulting from a release of or exposure to these hazardous substances or wastes, any of which could result in expenditures and could have a material adverse effect on us.
In 19 Table of Contents certain jurisdictions, the remedies available to us, in the context of seller-financing, may also limit our ability to recover any deficiencies after a buyer defaults and we foreclose on the asset. Additionally, we may be required to bear additional costs associated with a property.
In certain jurisdictions, the remedies available to us, in the context of seller-financing, may also limit our ability to recover any deficiencies after a buyer defaults and we foreclose on the asset. Additionally, we may be required to bear additional costs associated with a property.
Lock-out provisions are provisions that generally prohibit repayment of a loan balance for a certain number of years following the origination date of a loan. We may finance properties with lock-out provisions, which could materially restrict us from selling or otherwise disposing of or refinancing properties.
Lock-out provisions are provisions that generally prohibit repayment without fees or costs of a loan balance for a certain number of years following the origination date of a loan. We may finance properties with lock-out provisions, which could materially restrict us from selling or otherwise disposing of or refinancing properties.
We may also decide to retain income we earn from the sale or other disposition of our property and pay income tax directly on such income. In that event, our shareholders would be treated as if they earned that income and paid the tax on it directly.
We may also decide to retain income we earn from the sale or other disposition of any of our properties and pay income tax directly on such income. In that event, our shareholders would be treated as if they earned that income and paid the tax on it directly.
As required by our listing on the NYSE, certain awards under the GCC Incentive Plan were settled during each of the fourth quarter 2023 and fourth quarter 2024 and will be settled in three additional annual installments thereafter, unless waived or modified.
As required by our listing on the NYSE, certain awards under the GCC Incentive Plan were settled during each of the fourth quarter 2023, fourth quarter 2024 and fourth quarter 2025 and will be settled in two additional annual installments thereafter, unless waived or modified.
Participants in the GCC 26 Table of Contents Incentive Plan, including Messrs. Escalante and Bitar, are entitled to receive distributions from the GCC Incentive Plan in the form of cash, common shares, or other property, or a combination thereof, as elected by the plan administrator.
Participants in the GCC Incentive Plan, including Messrs. Escalante and Bitar, are entitled to receive distributions from the GCC Incentive Plan in the form of cash, common shares, or other property, or a combination thereof, as elected by the plan administrator.
These current conditions, or similar conditions existing in the future, may adversely affect our business, financial condition, results of operations and ability to pay dividends to our shareholders as a result of one or more of the following, among other potential consequences: • significant job losses may occur, which may decrease demand for our office and industrial space, causing market rental rates and property values to be negatively impacted, and create increased challenges in disposing of properties in accordance with our business plan; • reduced values of our properties may limit our ability to sell assets at attractive prices or to obtain debt financing secured by our properties and may reduce the availability of secured or unsecured loans; • inflation may adversely affect tenant leases with stated rent increases tied to the consumer price index, which could be lower than the increase in inflation at any given time; • the financial condition of our tenants may be adversely affected, which may result in tenant defaults under leases due to inflationary pressure, bankruptcy, lack of liquidity, the stability of tenants’ banking institutions, lack of funding, operational failures or for other reasons; • our ability to borrow on terms and conditions that we find acceptable, or at all, may be limited, which could reduce our ability to refinance existing debt and increase our future interest expense; • the value and liquidity of our short-term investments and cash deposits could be reduced as a result of a deterioration of the financial condition of the institutions that hold our cash deposits or the institutions or assets in which we have made short-term investments, a dislocation of the markets for our short-term investments, increased volatility in market rates for such investments or other factors; • unanticipated increases in costs; and • to the extent we enter into derivative financial instruments, one or more counterparties to our derivative financial instruments could default on their obligations to us, or could fail, increasing the risk that we may not realize the benefits of these instruments.
These current conditions, or similar conditions existing in the future, may adversely affect our business, financial condition, results of operations and ability to pay dividends to our shareholders as a result of one or more of the following, among other potential consequences: • significant job losses may occur, which may decrease demand for our industrial properties, causing market rental rates and property values to be negatively impacted; • reduced values of our properties may limit our ability to lease at projected rates, sell assets at attractive prices, or to obtain debt financing secured by our properties and may reduce the availability of secured or unsecured loans; • inflation may adversely affect tenant leases with stated rent increases tied to the consumer price index, which could be lower than the increase in inflation at any given time; • our leases may include fixed rate increase which may be below market rates; • the financial condition of our tenants may be adversely affected, which may result in tenant defaults under leases due to inflationary pressure, bankruptcy, lack of liquidity, the stability of tenants’ banking institutions, lack of funding, operational failures or for other reasons; • our ability to borrow on terms and conditions that we find acceptable, or at all, may be limited, which could reduce our ability to refinance existing debt and increase our future interest expense; • the value and liquidity of our short-term investments and cash deposits could be reduced as a result of a deterioration of the financial condition of the institutions that hold our cash deposits or the institutions or assets in which we have made short-term investments, a dislocation of the markets for our short-term investments, increased volatility in market rates for such investments or other factors; • unanticipated increases in costs; • the strength of the financial institutions we bank with; and • to the extent we enter into derivative financial instruments, one or more counterparties to our derivative financial instruments could default on their obligations to us, or could fail, increasing the risk that we may not realize the benefits of these instruments.
Our declaration of trust prohibits the ownership by any Person (as defined in our declaration of trust) of more than 9.8% (in value or in number, whichever is more restrictive, as determined in good faith by our Board) of the aggregate of our common shares or more than 9.8% of the value (as determined in good faith by our Board) of the aggregate of our outstanding Shares (as defined in our declaration of trust), unless waived by our Board.
Our declaration of trust prohibits the ownership by any Person (as defined in our declaration of trust) of more than 9.8% (in value or in number, whichever is more restrictive) of the aggregate of our common shares or more than 9.8% of the value of the aggregate of our outstanding Shares (as defined in our declaration of trust), unless waived by our Board.
Property ownership through joint ventures and partnerships could limit control of those investments, which could adversely affect our ability to manage such properties and related business. Property ownership through joint ventures or partnerships involve risks that would not be present were a third party not involved.
Property ownership through joint ventures and partnerships could limit control of those investments, which could adversely affect our ability to manage such properties and related business. 16 Table of C ontents Property ownership through joint ventures or partnerships involve risks that would not be present were a third party not involved.
Leases representing approximately a third of our Annualized Base Rent as of December 31, 2024 are scheduled to expire in the next four years. An inability to sell or re-lease such properties could result in a material adverse effect on us.
Leases representing approximately a third of our Annualized Base Rent as of December 31, 2025 are scheduled to expire in the next three years. An inability to sell or re-lease such properties could result in a material adverse effect on us.
Such acquisitions and/or investments may present new challenges for us and pose risks additional to the risks described above, including exposure to additional governmental regulation with which we may not have prior experience, negative reactions by market participants, and a perceived disadvantage in negotiating with existing and prospective tenants, among others.
Such acquisitions and/or investments may present new challenges for us and pose risks additional to the risks described above, including exposure to additional governmental regulation with which 15 Table of C ontents we may not have prior experience, negative reactions by market participants, and a perceived disadvantage in negotiating with existing and prospective tenants, among others.
(our “Predecessor”), received OP Units (approximately 2.7 million taking into effect the 9 to 1 reverse split) as a consideration in exchange for the sale to our Predecessor of the advisory, asset management and property management business of Griffin Capital Real Estate Company, LLC (now known as PKST Management Company, LLC).
Shields, and affiliated with Griffin Capital Company, LLC, the sponsor of our Predecessor, received OP Units (approximately 2.7 million taking into effect the 9 to 1 reverse split) as a consideration in exchange for the sale to our Predecessor of the advisory, asset management and property management business of Griffin Capital Real Estate Company, LLC (now known as PKST Management Company, LLC).
Our properties are located in areas that may be subject to climate change and natural disasters, such as earthquakes and wildfires, and severe weather conditions.
We are subject to risks from climate change and natural disasters such as earthquakes and severe weather conditions. Our properties are located in areas that may be subject to climate change and natural disasters, such as earthquakes and wildfires, and severe weather conditions.
As we complete property dispositions, the overall size of our post-closing indemnification and retained liability obligations to purchasers may increase, and no assurance can be given that the extent of such indemnification obligations and retained liabilities will not, individually or in the aggregate, have a material adverse effect on us.
The overall size of our post-closing indemnification and retained liability obligations to purchasers may increase, and no assurance can be given that the extent of such indemnification obligations and retained liabilities will not, individually or in the aggregate, have a material adverse effect on us.
If we do not have access to sufficient funding in the future, our ability to make necessary capital improvements to our properties, pursue acquisitions of and/or other investments in properties as part of our business plan, pay our expenses, pay dividends or expand our business may be impaired or delayed.
If we do not have access to sufficient funding in the future, our ability to make necessary capital improvements to our properties, pursue acquisitions of and/or other investments in properties as part of our business plan, pay our expenses, including such expenses related to our outstanding indebtedness, pay dividends or expand our business may be impaired or delayed.
The development or redevelopment of such properties is subject to various risks, including the following, among others: • time required to complete the development or redevelopment of a property or to lease up the completed project may be greater than originally anticipated, which may result in increased debt service expense and additional downtime and expense carry costs; • rents may not meet our projections and the project may perform below anticipated levels, thereby adversely impacting our cash flows; • we may have delays in obtaining construction materials and may be subject to increases in costs of materials, particularly as a result of the imposition of tariffs; • we may face delays or difficulties with respect to complying with applicable zoning regulations and obtaining and maintaining necessary occupancy, land use and other governmental permissions and permits; • contractor and subcontractor disputes, strikes, lack of available labor, labor disputes or supply chain disruptions may occur; • we may need the consent of third parties such as mortgage lenders and joint venture partners, and those consents may be withheld; 13 Table of Contents • newly acquired properties may be subject to ongoing legal proceedings; and • speculative development, redevelopment or expansions may fail to appeal to the prospective users in the market in which they are located.
The development or redevelopment of such properties is subject to various risks, including the following, among others: • time required to complete the development or redevelopment of a property or to lease up the completed project may be greater than originally anticipated, which may result in increased debt service expense and additional downtime and expense carry costs; • cost overruns or delays, including as a result of a delay in obtaining construction materials, may occur due to tariffs, contractor pricing, supply constraints or labor availability; • lease commencements may be delayed, rents may not meet our projections and the project may perform below anticipated levels, thereby adversely impacting our cash flows; • we may face delays or difficulties with respect to complying with applicable zoning regulations and obtaining and maintaining necessary occupancy, land use and other governmental permissions and permits; • contractor and subcontractor disputes, strikes, lack of available labor, labor disputes or supply chain disruptions may occur; • we may need the consent of third parties such as mortgage lenders and joint venture partners, and those consents may be withheld; • newly acquired properties may be subject to ongoing legal proceedings; and • speculative development, redevelopment or expansions may fail to appeal to the prospective users in the market in which they are located.
The liability can include an imputed underpayment of tax, calculated by using the highest marginal U.S. federal income tax rate, as well as interest and penalties on such imputed underpayment of tax.
The 26 Table of C ontents liability can include an imputed underpayment of tax, calculated by using the highest marginal U.S. federal income tax rate, as well as interest and penalties on such imputed underpayment of tax.
We may be required to increase capital expenditures or accept unfavorable terms in connection with the sale or re-leasing of properties, particularly during periods of downturns in the real estate market and periods of concentrations in our lease expirations.
We may be required to increase capital expenditures or accept unfavorable terms in connection with the 12 Table of C ontents re-leasing of properties, particularly during periods of downturns in the real estate market and periods of concentrations in our lease expirations.
Our investment in traditional industrial properties and IOS properties exposes us to extensive zoning, occupancy and land use regulations. Our investment in traditional industrial properties and IOS properties exposes us to extensive zoning, occupancy and land use regulations, which could change and result in non-conforming uses at our properties and/or limit the use of our properties by different tenants.
Our investment in industrial properties exposes us to extensive zoning, occupancy and land use regulations, which could change and result in non-conforming uses at our properties, limit the use of our properties by different tenants and/or result in the termination of our leases by existing tenants.
A shortfall between the cash flow from our properties and the cash flow needed to service debt could have a material adverse effect on us. We expect to need additional funding to fund future investments. We expect to need additional funding to finance our investments.
A shortfall between the cash flow from our properties and the cash flow needed to service debt could have a material adverse effect on us. 23 Table of C ontents We expect to need additional funding to fund future investments. We expect to need additional funding to finance our investments.
As further described below, as of December 31, 2024, GC LLC 2,273,473 OP Units owned, which, upon a request for redemption by GC LLC, are exchangeable into common shares or cash, at the Company’s election.
As further described below, as of December 31, 2025, GC LLC owned 2,060,860 OP Units, which, upon a request for redemption by GC LLC, are exchangeable into common shares or cash, at the Company’s election.
Increases in the interest we pay on our indebtedness could adversely affect our ability to pay dividends to shareholders, among other consequences. Additionally, if we incur variable rate debt, increases in interest rates would increase our interest costs, could reduce our cash flows and our ability to pay dividends to shareholders or otherwise have a material adverse effect on us.
Additionally, if we incur variable rate debt, increases in interest rates would increase our interest costs, could reduce our cash flows and our ability to pay dividends to shareholders or otherwise have a material adverse effect on us.
Should we desire to terminate a hedging agreement, there could be significant costs and cash requirements involved to fulfill our obligation under the hedging agreement. U.S.
Should we desire to terminate a hedging agreement, there could be significant costs and cash requirements involved to fulfill our obligation under the hedging agreement. 24 Table of C ontents U.S.
In addition, we may incur costs and liabilities associated with the disposal or treatment of hazardous or toxic substances, claims by third parties based on damages and costs resulting from environmental contamination emanating from own of our properties, or liability in connection with the handling or exposure to asbestos-containing materials.
In addition, we may incur costs and liabilities associated with the transportation, disposal or treatment of hazardous substances or wastes, claims by third parties based on damages resulting from environmental contamination emanating from one of our properties, or liability in connection with the handling or exposure to hazardous substances or wastes.
Our acquisition of IOS assets and shift in focus in our business strategy to more industrial assets may expose us to additional risks, including, but not limited to: • exposure to complex legal and regulatory requirements, including environmental, zoning, occupancy, land use and other governmental regulations; • exposure to existing environmental issues, which may require removing or remediating hazardous or toxic substances; • market participants may react negatively to our entry into this new business line and the price of our common shares may decline; • we may be unable to quickly and efficiently integrate this acquisition into our existing operations; • market conditions may result in higher than expected vacancy rates and lower than expected rental rates; • exposure to risks associated with the need to develop or redevelop properties in order for such properties to be leased by a new tenant, including the risk that our development or redevelopment costs may be impacted by tariffs and that we may spend more than budgeted amounts to make necessary improvements or renovations to such properties; and • our management team may need to allocate significant time and resources and may encounter challenges supporting, leasing, and developing these assets, which could divert attention from our existing operations If we are unable to effectively manage these challenges, it could have a material adverse effect on us.
The continued acquisition of IOS properties or other industrial assets expose us to certain risks, including, but not limited to: • exposure to complex legal and regulatory requirements, including environmental, zoning, occupancy, land use and other governmental regulations; • exposure to existing environmental issues, which may require removing or remediating hazardous or toxic substances; • we may be unable to quickly and efficiently integrate acquired properties into our existing operations; • exposure to tenants in industries with which we do not have prior experience; • market conditions may result in higher than expected vacancy rates and lower than expected rental rates; • exposure to risks associated with the need to develop or redevelop properties in order for such properties to be leased by a new tenant, including the risk that our development or redevelopment costs may be impacted by tariffs and that we may spend more than budgeted amounts to make necessary improvements or renovations to such properties; and • our management team may need to allocate significant time and resources and may encounter challenges supporting, leasing, and/or developing these assets, which could divert attention from our existing operations. 14 Table of C ontents If we are unable to effectively manage these challenges, it could have a material adverse effect on us.
Risks Related to Debt Financing As of December 31, 2024, we had $1.36 billion of indebtedness outstanding, which requires substantial cash flow to service, subjects us to risk of default, which could have a material adverse effect on us. As of December 31, 2024, we had $1.36 billion of indebtedness outstanding.
Risks Related to Debt Financing As of December 31, 2025, we had $485.9 million of indebtedness outstanding, which requires substantial cash flow to service, subjects us to risk of default, which could have a material adverse effect on us. As of December 31, 2025, we had $485.9 million of indebtedness outstanding.
Any of the foregoing could have a material adverse effect on us. Our unsecured credit facility and certain of our secured indebtedness contain, and any other future indebtedness we incur may contain, various covenants, including business activity restrictions, and the failure to comply with those covenants could have a material adverse effect on us.
Any of the foregoing could have a material adverse effect on us. 22 Table of C ontents Our unsecured credit facility and certain of our secured indebtedness contain, and any other future indebtedness we incur may contain, various restrictive covenants and the failure to comply with those covenants could have a material adverse effect on us.
Any of the foregoing could have a material adverse effect on us. 20 Table of Contents In addition, the assumptions in our corporate credit agreement and mortgage debt regarding values, cash flow and debt service coverage, and individual asset underwriting of performance metrics such as loan-to-value ratios, debt service coverage ratios and debt yields that support our current borrowings may be subject to change, as market conditions change and/or lending standards become more stringent.
In addition, the assumptions in our corporate credit agreement and mortgage debt regarding values, cash flow and debt service coverage, and individual asset underwriting of performance metrics such as loan-to-value ratios, debt service coverage ratios and debt yields that support our current borrowings may be subject to change, as market conditions change and/or lending standards become more stringent.
If there is an increase in property operating expenses that we are unable to pass along to our tenants, then our 12 Table of Contents business, financial condition and results of operations could be negatively impacted.
If we fail to identify and/or if there is an increase in property operating expenses that we are unable to pass along to our tenants promptly or at all, then our business, financial condition and results of operations could be negatively impacted.
When we have a geographic concentration of exposures, a single catastrophe (such as an earthquake) affecting an area in which we have a significant concentration of properties, such as in Arizona, Colorado, Massachusetts, California and New Jersey, could have a material adverse effect on us.
When we have a geographic concentration of exposures, a single catastrophe (such as an earthquake) affecting an area in which we have a significant concentration of properties, such as in Georgia, Florida, Illinois, Ohio and California, could have a material adverse effect on us.
On December 9, 2024, GC LLC elected to redeem 213,043 OP Units pursuant to the terms of our Operating Partnership’s operating agreement, and we satisfied such redemption request with our common shares. Following this redemption, GC LLC distributed such common shares to participants in the GCC Incentive Plan, including 56,266 common shares to Mr.
Effective December 9, 2025, GC LLC elected to redeem 212,613 OP Units pursuant to the terms of our Operating Partnership’s operating agreement, and we satisfied such redemption request with our common shares. Following this redemption, GC LLC distributed such common shares to participants in the GCC Incentive Plan, including 28,133 common shares to Mr.
We own and operate real estate and face risks related to investments in real estate. As of December 31, 2024, our real estate portfolio comprised 103 properties, consisting of 97 operating properties and six redevelopment properties, in 24 states with 83 lessees. Our operating results will be subject to risks generally incident to the ownership of real estate.
We own and operate real estate and face risks related to investments in real estate. As of December 31, 2025, our real estate portfolio comprised 76 properties, consisting of 72 operating properties and four redevelopment properties, in 18 states with 61 lessees. Our operating results will be subject to risks generally incident to the ownership of real estate.
We may not be able to control the extent of warranties and indemnities we may be required to provide when disposing of properties. 14 Table of Contents As we seek to sell certain properties, in some circumstances market conditions may impact the terms on which we are able to sell properties, which may require us to provide warranties, representations and covenants, and agree to indemnification obligations or to retain certain liabilities, in order to complete such dispositions.
We may seek to sell certain properties, and in some circumstances market conditions may impact the terms on which we are able to sell properties, which may require us to provide warranties, representations and covenants, and agree to indemnification obligations or to retain certain liabilities, in order to complete such dispositions.
Leases representing approximately half of our Annualized Base Rent as of December 31, 2024 are scheduled to expire in the next four years.
Leases representing approximately one-third of our Annualized Base Rent as of December 31, 2025 are scheduled to expire in the next three years.
We may be unable to fully benefit from increases in market rental rates because certain of our leases contain fixed renewal rates or limitations on market rental rate resets upon renewal. Furthermore, we may be unable to renew expiring leases, or re-lease available space, above or at current market rental rates.
We may be unable to fully benefit from increases in market rental rates because certain of our leases contain fixed renewal rates or limitations on market rental rate resets upon renewal.
If we provide seller-financing to purchasers (also known as purchase money financing), we will bear the risk that the purchaser may default, which could have a material adverse effect on us. Even in the absence of a purchaser default, there may be a material adverse effect on us.
If we sell properties by providing financing to purchasers, defaults by the purchasers could have a material adverse effect on us. If we provide seller-financing to purchasers (also known as purchase money financing), we will bear the risk that the purchaser may default, which could have a material adverse effect on us.
If acquisitions of and/or other investments in properties do not perform as expected or market conditions deteriorate, there may be a material adverse effect on us.
If acquisitions of and/or other investments in properties do not perform as expected or market conditions deteriorate, there may be a material adverse effect on us. We are uncertain of our sources of funding for our future capital needs.
Additionally, a default by a tenant relating to rental payments or other lease obligations, or the failure of a guarantor to fulfill its obligations or a premature termination of a lease, could have a material adverse effect on us.
In addition, we may incur expenses, including property taxes, all of which could have a material adverse effect on us. Additionally, a default by a tenant relating to rental payments or other lease obligations, or the failure of a guarantor to fulfill its obligations or a premature termination of a lease, could have a material adverse effect on us.
Many investment funds focus on positive ESG business practices and sustainability scores when making investments and may consider a company’s sustainability score as a reputational or other factor in making an investment decision.
Currently, there are no universal standards for such scores or ratings. Investment funds have and may focus on positive ESG business practices and sustainability scores when making investments and may consider a company’s sustainability score as a reputational or other factor in making an investment decision.
Even security measures that are appropriate, reasonable and/or in accordance with applicable legal requirements may not be sufficient to protect our IT Systems and the Confidential Information we maintain due to attackers using tools and techniques that are designed to circumvent controls, avoid detection and remove or obfuscate forensic evidence.
Our security measures may not be sufficient to 31 Table of C ontents protect our IT Systems and the Confidential Information we maintain due to attackers using tools and techniques that are designed to circumvent controls, avoid detection and remove or obfuscate forensic evidence.
In general, prohibited transactions are sales or other dispositions of property, other than foreclosure property, held primarily for sale to customers in the ordinary course of business.
A REIT’s net income from prohibited transactions is subject to a 100% penalty tax. In general, prohibited transactions are sales or other dispositions of property, other than foreclosure property, held primarily for sale to customers in the ordinary course of business.
As our reliance on technology increases, so do the risks posed to our systems - both internal and external. Our primary risks that could directly result from the occurrence of a cyber incident are theft of assets; operational interruption; regulatory enforcement, lawsuits and other legal proceedings; damage to our relationships with our tenants; and exposure of Confidential Information.
Key risks that could directly result from the occurrence of a cyber incident are theft of assets; operational interruption; regulatory enforcement, lawsuits and other legal proceedings; damage to our relationships with our tenants; compromise of our IT Systems, and exposure of Confidential Information.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThis does not imply that we meet any particular technical standards, specifications, or requirements, but only that we may source controls applicable to our industry from these frameworks as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business. 30 Table of Contents Our cybersecurity risk management program includes: • risk assessments designed to help identify material cybersecurity risks to our Confidential Information, Critical Systems and the broader enterprise IT environment; • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; • the use of Service Providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls; • cybersecurity awareness and spear-phishing resistance training of our employees, incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a vendor management policy for Service Providers that provide an automated service or system that stores, transmits or processes our Confidential Information.
Biggest changeKey elements of our cybersecurity risk management program include but are not limited to the following: • risk assessments designed to help identify material risks from cybersecurity threats to our Confidential Information and Critical Systems; • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security processes; • cybersecurity awareness and spear-phishing resistance training of our employees, incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a vendor management policy for key service providers based on our assessment of their criticality to our operations and respective risk profiles, which may include service providers that provide an automated service or system that stores, transmits or processes our Confidential Information.
Our management team meets with Connetic regularly to discuss then-current cybersecurity issues, which may include efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, including threat intelligence and other information obtained from governmental, public or private sources, and external service providers engaged by us; and alerts and reports produced by security tools deployed in the information technology environment including a spear-phishing report.
Our management team meets with our information technology Service Provider regularly to discuss then-current cybersecurity issues, which may include efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, including threat intelligence and other information obtained from governmental, public or private sources, and external service providers engaged by us; and alerts and reports produced by security tools deployed in the information technology environment including a spear-phishing report.
ITEM 1C. CYBERSECURITY Cybersecurity Risk Management and Strategy The cybersecurity risk management program, processes and strategy described in this section are limited to the personal and business information belonging to or maintained by the Company (collectively, “Confidential Information”), our own third-party critical systems and services supporting or used by the Company (collectively, “Critical Systems”), and Service Providers.
ITEM 1C. CYBERSECURITY Cybersecurity Risk Management and Strategy The cybersecurity risk management program, processes and strategy described in this section are limited to the personal and business information belonging to or maintained by the Company (collectively, “Confidential Information”) and our own third-party critical systems and services supporting or used by the Company (collectively, “Critical Systems”).
The Audit Committee receives periodic reports from management or Connetic on our cybersecurity risks and cybersecurity risk management program. In addition, the executive management team is responsible for updating the Audit Committee, as necessary, regarding significant cybersecurity incidents. The Audit Committee reports to the full Board regarding its activities, including those related to cybersecurity.
The Audit Committee receives periodic reports from management or our information technology Service Provider on our cybersecurity risks and cybersecurity risk management program. In addition, the executive management team is responsible for updating the Audit Committee, as necessary, regarding significant cybersecurity incidents. The Audit Committee reports to the full Board regarding its activities, including those related to cybersecurity.
The full Board also receives period reports from management or Connetic on our cybersecurity risks and cybersecurity risk management program. Our Board receives presentations on cybersecurity topics from Connetic as part of the Board’s continuing education on topics that impact public companies.
The full Board also receives period reports from management or our information technology Service Provider on our cybersecurity risks and cybersecurity risk management program. Our Board also receives presentations on cybersecurity topics from our information technology Service Provider as part of the Board’s continuing education on topics that impact public companies.
See “ Risk Factors—General Risks—Cybersecurity risks and cyber incidents or the failure to comply with laws and regulations concerning data privacy and security may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information, and/or damage to our business relationships, any of which could have a material adverse effect on us.” Cybersecurity Governance A security team consisting of our executive management team, other members of senior management, and our managed information technology Service Provider, Connetic, LLC, a Delaware limited liability company (“Connetic”) is responsible for assessing and managing risks from cybersecurity threats to the Company, including our Confidential Information and Critical Systems.
See “Risk Factors—General Risks—Cybersecurity risks and cyber incidents or the failure to comply with laws and regulations concerning data privacy and security may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information, and/or damage to our business relationships, any of which could have a material adverse effect on us.” Cybersecurity Governance A security team consisting of our executive management team, our Managing Director, Administration and Legal, and our managed information technology Service Provider, Porcaro Stolarek Mete Partners, LLC (“PSM Partners”), is responsible for assessing and managing risks from cybersecurity threats to the Company, including our Confidential Information and Critical Systems.
The team has primary responsibility for our overall cybersecurity risk management program. Connetic has provided information technology support, security audit and on-call services to financial industry participants for more than 25 years.
The team has primary responsibility for our overall cybersecurity risk management program. PSM Partners has 35 Table of C ontents provided information technology support, cybersecurity audits, and full-coverage managed IT services to financial industry participants for over a decade.
Removed
Additionally, we maintain a cybersecurity insurance policy to mitigate certain risks associated with cybersecurity incidents. However, the costs, damages, and expenses arising from cybersecurity incidents may not be completely covered by such insurance.
Added
This does not imply that we meet any particular technical standards, specifications, or requirements, but only that we may source controls applicable to our industry from these frameworks as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeBy State: The percentage of ABR by state for the Company’s portfolio as of December 31, 2024 is presented as follows (dollars in thousands): State ABR (unaudited) Number of Properties Percentage of ABR Arizona $ 20,287 5 11.0 % Colorado 13,989 4 7.6 Massachusetts 12,839 3 6.9 California 12,610 2 6.8 New Jersey 11,649 8 6.3 South Carolina 11,415 7 6.2 Florida 10,768 8 5.8 Ohio 10,762 4 5.8 Tennessee 10,204 7 5.5 Alabama 9,409 1 5.1 Subtotal 123,932 49 67.0 All Others (1) 61,124 54 33.0 Total $ 185,056 103 100.0 % (1) “ All Others” account for less than 5.1% of total ABR on an individual basis.
Biggest changeFor leases in effect at the end of any quarter that provide for rent abatement during the last month of that quarter, the Company used the monthly contractual base rent payable following expiration of the abatement period. 36 Table of C ontents By State: The percentage of ABR by state for the Company’s Industrial segment as of December 31, 2025 is presented as follows (dollars in thousands): State ABR (unaudited) Number of Properties Percentage of ABR Georgia $ 12,523 14 16.0 % Florida 11,474 11 14.7 Illinois 9,582 4 12.3 Ohio 8,130 3 10.4 California 7,789 1 10.0 Pennsylvania 5,312 6 6.8 Texas 4,155 9 5.3 Virginia 3,957 5 5.1 South Carolina 2,611 5 3.3 New Jersey 2,570 6 3.3 Subtotal $ 68,103 64 87.2 % All Others (1) 10,043 12 12.8 Total $ 78,146 76 100.0 % (1) “ All Others” account for less than 2.6% of total ABR on an individual basis.
(3) Annualized Net Effective Base Rent (per square foot) is calculated as (i) the contractual base rent for leases that have commenced as of the end of the quarter calculated on a straight-line basis, including amortization of rent abatements, but without regard to tenant improvement allowances and leasing commissions, and deducting base year operating expenses for gross and modified gross leases, unless otherwise specified, multiplied by 12 months divided by (ii) square footage under lease as of the end of the end of the quarter.
(3) Annualized Net Effective Base Rent (per square foot) is calculated as (i) the contractual base rent for leases that have commenced as of the end of the quarter calculated on a straight-line basis, including amortization of rent abatements, but without regard to tenant improvement allowances and leasing commissions, and deducting base year operating expenses for gross and modified gross leases, unless otherwise specified, multiplied by 12 months divided by (ii) square footage under lease as of the end of the quarter.
(3) Annualized Net Effective Base Rent (per usable acre) is calculated as (i) the contractual base rent for leases that have commenced as of the end of the quarter calculated on a straight-line basis, including amortization of rent abatements, but without regard to tenant improvement allowances and leasing commissions, and deducting base year operating expenses for gross and modified gross leases, unless otherwise specified, multiplied by 12 months divided by (ii) acreage under lease as of the end of the quarter.
(3) Annualized Net Effective Base Rent (per usable acre) is calculated as (i) the contractual base rent for leases that have commenced as of the end of the quarter calculated on a straight-line basis, including amortization of rent abatements, but without regard to tenant improvement allowances and leasing commissions, and deducting base year operating expenses for gross and modified gross leases, unless otherwise specified, multiplied by 12 months divided by (ii) usable acreage under lease as of the end of the quarter.
Our estimates regarding current average market rental rates are based on our internal analysis and/or third-party broker quotes, when available, and there is no assurance that these estimates will prove to be accurate.
Our estimates regarding current average market rental rates are based on our internal analysis and/or third-party broker input, when available, and there is no assurance that these estimates will prove to be accurate.
“Exhibits, Financial Statement Schedules—Schedule III—Real Estate and Accumulated Depreciation and Amortization,” of this Annual Report on Form 10-K for a detailed listing of our properties. See Note 5 , Debt, 31 Table of Contents to our consolidated financial statements included in this Annual Report on Form 10-K for more information about our indebtedness secured by our properties.
“Exhibits, Financial Statement Schedules—Schedule III—Real Estate and Accumulated Depreciation and Amortization,” of this Annual Report on Form 10-K for a detailed listing of our properties. See Note 5, Debt , to our consolidated financial statements included in this Annual Report on Form 10-K for more information about our indebtedness secured by our properties.
Lease Expirations: The tables below provide a summary of our upcoming lease expirations in our portfolio, excluding unexercised renewal options and early termination rights.
Lease Expirations: The tables below provide a summary of upcoming lease expirations in our Industrial segment, excluding unexercised renewal options and early termination rights.
Revenue Concentration The Company presents the following concentrations based on Annualized Base Rent (“ABR”), which is calculated as the monthly contractual base rent for leases that have commenced as of the end of the quarter, excluding rent abatements, multiplied by 12 months and deducting base year operating expenses for gross and modified leases, unless otherwise specified.
ABR is calculated as the monthly contractual base rent for leases that have commenced as of the end of the quarter, excluding rent abatements, multiplied by 12 months and deducting base year operating expenses for gross and modified leases, unless otherwise specified.
Rent abatements include rent credits that are granted from time to time in connection with unused tenant improvement allowances. As of December 31, 2024, the lease expirations for leases based on acres are presented as follows: Year of Lease Expiration (1) ABR (unaudited, in thousands) Percentage of Annualized Base Rent Number of Leases Approx.
Rent abatements include rent credits that are granted from time to time in connection with unused tenant improvement allowances. (4) Represents unleased space at redevelopment properties. Traditional Industrial Lease Expirations (Square Foot Basis) Year of Lease Expiration (1) ABR (unaudited, in thousands) Percentage of Annualized Base Rent Number of Leases Approx.
(4) Represents unleased space at redevelopment properties. 34 Table of Contents Leasing Information As of December 31, 2024, we estimate that the current average market rental rates for all leases in our operating portfolio that are scheduled to expire within the next four years are: (i) for our Industrial segment, approximately 30% to 35% greater than the weighted average in-place cash rental rates; and (ii) for our Office segment, approximately 5% to 10% less than the weighted average in-place cash rental rates.
Rent abatements include rent credits that are granted from time to time in connection with unused tenant improvement allowances. 39 Table of C ontents Leasing Information As of December 31, 2025, we estimate that the current average market rental rates for leases for the operating properties in our Industrial segment, that are scheduled to expire within the next four years are approximately 20% to 25% greater than the weighted average in-place cash rental rates.
As of December 31, 2024, the lease expirations for the Company’s portfolio are presented as follows (dollars in thousands): Year of Lease Expiration (1) ABR (unaudited) Percentage of Annualized Base Rent 2025 $ 1,984 1.1 % 2026 12,208 6.6 % 2027 18,834 10.2 % 2028 20,100 10.9 % 2029 32,316 17.5 % 2030 27,851 15.1 % 2031 19,589 10.6 % 2032 14,423 7.8 % 2033 9,629 5.1 % 2034 — — % >2034 28,122 15.1 % Vacant — — % Total $ 185,056 100.0 % (1) Expirations that occur on the last day of the year are shown as expiring in the subsequent year. 33 Table of Contents As of December 31, 2024, the lease expirations for leases based on square footage are presented as follows: Year of Lease Expiration (1) ABR (unaudited, in thousands) Percentage of Annualized Base Rent Number of Leases Approx.
As of December 31, 2025, the lease expirations by ABR in our leases for the Industrial segment are presented as follows (dollars in thousands): Year of Lease Expiration (1) ABR (unaudited) Percentage of Annualized Base Rent 2026 $ 6,911 8.8 % 2027 5,577 7.1 2028 12,531 16.0 2029 9,317 11.9 2030 13,650 17.5 2031 13,130 16.8 2032 4,292 5.5 2033 7,283 9.3 2034 1,934 2.5 2035 1,302 1.7 >2035 2,219 2.9 Total $ 78,146 100.0 % (1) Expirations that occur on the last day of the year are shown as expiring in the subsequent year. 38 Table of C ontents As of December 31, 2025, the Company’s Industrial segment includes both IOS properties, which are leased on a usable-acre basis, and Traditional Industrial properties, which are leased on a square-footage basis.
Market rental rates and the demand for our properties are impacted by general economic conditions, including the pace of economic growth and access to capital in the submarkets in which our properties are located. Therefore, there is no assurance that expiring leases will be renewed or that available space will be re-leased above, below or at current market rental rates.
Market rental rates and the demand for our properties are impacted by general economic conditions, including the pace of economic growth, inflation, interest rates, and labor market and demographic trends in the submarkets in which our properties are located.
(2) Calculated as the change between GAAP rents for new/renewal leases and the expiring GAAP rents for the same space. (3) Calculated as the change between cash rents for new/renewal leases and the expiring cash rents for the same space.
For each lease, the Company presents (i) “GAAP Rent Change”, which is calculated as the percentage change between GAAP rents for new/renewal leases and the expiring GAAP rents of comparable leases for the same space and (ii) “Cash Rent Change”, which is calculated as the percentage change between cash rents for new/renewal leases and the expiring cash rents of comparable leases for the same space, excluding any rent abatements.
ITEM 2. PROPERTIES As of December 31, 2024, the Company’s portfolio was comprised of 103 properties, consisting of 97 operating properties and six redevelopment properties (those designated for redevelopment or repositioning) reported in two segments – Industrial and Office. See Part IV, Item 15.
ITEM 2. PROPERTIES As of December 31, 2025, the Company has one reportable Industrial segment, which includes 76 industrial properties comprised of 60 IOS properties and 16 Traditional Industrial properties. Of the 76 properties in our portfolio, 72 were operating properties and four were designated for redevelopment or repositioning. See Part IV, Item 15.
Square Feet ABR (per square foot) (2) Annualized Net Effective Base Rent (per square foot) (3) 2025 $ 1,508 0.9 % 2 73,000 $ 20.66 $ 20.04 2026 9,813 6.0 3 1,273,500 7.71 8.74 2027 14,524 8.9 7 570,700 25.45 23.98 2028 15,684 9.6 7 1,762,500 8.90 8.58 2029 30,247 18.6 7 2,015,100 15.01 14.88 2030 26,137 16.0 5 2,342,700 11.16 11.01 2031 16,217 10.0 4 1,379,500 11.76 11.88 2032 12,206 7.5 6 1,457,100 8.38 8.78 2033 8,429 5.2 4 1,454,900 5.79 5.99 2034 — — — — — — >2034 28,122 17.3 9 1,964,500 14.32 16.34 Vacant — — — 69,000 — — Total $ 162,887 100.0 % 54 14,362,500 $ 11.40 $ 11.69 (1) Expirations that occur on the last day of the year are shown as expiring in the subsequent year.
Square Feet ABR (per square foot) (2) Annualized Net Effective Base Rent (per square foot) (3) 2026 $ 5,202 11.2 % 1 978,100 $ 5.32 $ 4.99 2027 — — — — — — 2028 7,846 17.0 4 1,290,100 6.08 5.71 2029 6,262 13.5 2 1,129,700 5.54 5.57 2030 7,789 16.8 1 1,501,400 5.19 4.91 2031 8,875 19.2 2 1,039,200 8.54 8.42 2032 2,020 4.4 1 526,300 3.84 3.87 2033 6,048 13.1 3 1,340,400 4.51 4.53 2034 — — — — — — 2035 — — — — — — >2035 2,219 4.8 2 435,100 5.10 4.48 Vacant — — — — — — Total $ 46,261 100.0 % 16 8,240,300 $ 5.61 $ 5.43 (1) Expirations that occur on the last day of the year are shown as expiring in the subsequent year.
Usable Acres ABR (per usable acre) (2) Annualized Net Effective Base Rent (per usable acre) (3) 2025 $ 476 2.1 % 2 12 $ 38,387 $ (74,194) 2026 2,395 10.8 7 29 81,574 72,446 2027 4,310 19.4 12 62 69,371 72,316 2028 4,416 19.9 9 91 48,363 50,871 2029 2,069 9.3 5 37 56,438 59,793 2030 1,714 7.7 4 21 81,619 95,190 2031 3,372 15.2 3 61 56,209 63,644 2032 2,217 10.1 4 23 96,100 123,400 2033 1,200 5.5 2 20 60,000 68,800 2034 — — — — — — >2034 — — — — — — Vacant — — — 2 — — Redevelopment properties (4) — — — 82 — — Total $ 22,169 100.0 % 48 440 $ 62,286 $ 63,430 (1) Expirations that occur on the last day of the year are shown as expiring in the subsequent year.
Usable Acres ABR (per usable acre) (2) Annualized Net Effective Base Rent (per usable acre) (3) 2026 $ 1,709 5.4 % 5 21 $ 80,995 $ 73,172 2027 5,577 17.5 14 71 78,771 80,743 2028 4,685 14.7 9 89 52,759 53,688 2029 3,055 9.6 7 46 66,996 65,468 2030 5,861 18.4 10 68 86,065 80,872 2031 4,255 13.3 5 70 60,960 64,488 2032 2,272 7.1 4 23 98,355 123,407 2033 1,235 3.9 2 20 61,750 68,750 2034 1,934 6.1 1 37 52,270 70,324 2035 1,302 4.0 3 14 93,669 93,285 >2035 — — — — — — Vacant — — — 10 — — Redevelopment properties (4) — — — 38 — — Total $ 31,885 100.0 % 60 507 $ 69,588 $ 72,324 (1) Expirations that occur on the last day of the year are shown as expiring in the subsequent year.
Removed
For leases in effect at the end of any quarter that provide for rent abatement during the last month of that quarter, the Company used the monthly contractual base rent payable following expiration of the abatement period.
Added
Revenue Concentration The tables below present the Company’s revenue concentrations for its Industrial segment based on Annualized Base Rent (“ABR”), as defined below.
Removed
By Industry: The percentage of ABR by industry for the Company’s portfolio as of December 31, 2024 is presented as follows (dollars in thousands): Industry (1) ABR (unaudited) Number of Lessees Percentage of ABR Capital Goods $ 34,745 26 18.8 % Materials 17,500 5 9.5 Food, Beverage & Tobacco 17,163 3 9.3 Retailing 12,085 4 6.5 Utilities 11,513 2 6.2 Health Care Equipment & Services 11,389 4 6.2 Commercial & Professional Services 11,313 6 6.1 Consumer Services 11,129 2 6.0 E-Commerce 9,978 2 5.4 Diversified Financials 8,977 2 4.9 Subtotal 145,792 56 78.9 All Others (2) 39,264 27 21.1 Total $ 185,056 83 100.0 % (1) Industry classification based on the Global Industry Classification Standard.
Added
By Industry: The percentage of ABR by industry for the Company’s Industrial segment as of December 31, 2025 is presented as follows (dollars in thousands): Industry (1) ABR (unaudited) Number of Lessees Percentage of ABR Capital Goods $ 25,791 28 33.0 % Consumer Discretionary Distribution & Retail 20,164 4 25.8 Consumer Durables & Apparel 8,001 2 10.2 Transportation 7,641 14 9.8 Food, Beverage & Tobacco 5,380 2 6.9 Commercial & Professional Services 4,130 6 5.3 Materials 3,448 2 4.4 Automobiles & Components 2,845 2 3.6 Real Estate Management & Development 746 1 1.0 Total $ 78,146 61 100.0 % (1) Industry classification based on the Global Industry Classification Standard. 37 Table of C ontents Top Ten Tenants: No lessee or combinations of lessees at any property generated more than 13.0% of our total ABR as of December 31, 2025.
Removed
(2) “ All Others” account for less than 4.2% of total ABR on an individual basis. 32 Table of Contents Top Ten Tenants: No lessee or property generated more than 6.4% of our total ABR as of December 31, 2024.
Added
The table below presents the top ten tenants by ABR for the Company’s Industrial segment as of December 31, 2025 (dollars in thousands): Tenant ABR (unaudited) Percentage of ABR Amazon $ 10,147 13.0 % RH 7,789 10.0 3M Company 5,202 6.7 Samsonite 4,666 6.0 PepsiCo 3,360 4.3 Shaw 3,335 4.3 Huntington Ingalls 2,667 3.4 United Rentals 2,278 2.9 Maxim Crane 2,051 2.6 Pepsi Bottling Ventures 2,020 2.6 Subtotal $ 43,515 55.8 % All Others (1) 34,631 44.2 Total $ 78,146 100.0 % (1) “All Others” account for less than 2.5% of ABR on an individual basis.
Removed
The top 10 tenants by ABR for the Company’s portfolio as of December 31, 2024 is presented as follows (dollars in thousands): Tenant ABR (unaudited) Percentage of ABR Keurig Dr.
Added
The tables below present lease expirations for each category. IOS Lease Expirations (Usable Acre Basis) Year of Lease Expiration (1) ABR (unaudited, in thousands) Percentage of Annualized Base Rent Number of Leases Approx.
Removed
Pepper $ 11,897 6.4 % Amazon 9,978 5.4 % Southern Company Services 9,409 5.1 % LPL Holdings 8,853 4.8 % Maxar Technologies 7,916 4.3 % Freeport McMoRan 7,867 4.3 % RH 7,637 4.1 % McKesson Corporation 6,276 3.4 % Travel & Leisure, Co. 5,928 3.2 % IGT 5,201 2.8 % Subtotal 80,962 43.8 % All Others (1) 104,094 56.2 % Total $ 185,056 100.0 % (1) “All Others” account for less than 2.8% of ABR on an individual basis.
Added
Therefore, there is no assurance that expiring leases will be renewed or that available space will be re-leased above, below or at current market rental rates. The following tables set forth certain information regarding our leasing activity during the year ended December 31, 2025 for our leases based on square footage and usable acres.
Removed
Rent abatements include rent credits that are granted from time to time in connection with unused tenant improvement allowances.
Added
We do not calculate GAAP Rent Change and Cash Rent Change for lease comparisons if either lease involved has any of the following characteristics, as we believe such leases do not provide a reliable basis for comparison: (i) the lease is for space that has never been leased under our ownership, (ii) the lease is for space that has been redeveloped or repositioned, (iii) the lease has a structure that is not comparable to the other lease or (iv) the lease term is less than 12 months.
Removed
The following tables set forth certain information regarding leasing activity for our operating portfolio during the year ended December 31, 2024: Leases Commenced (1) : Number of Leases Approx.
Added
Industrial Leasing Activity : Leases Executed - Usable Acres: Number of Leases Approx.
Removed
Square Feet Weighted Average Lease Term LC (per square feet) TI (per square feet) GAAP Rent Change (2) Cash Rent Change (3) New Leases 1 26,800 2.0 $ 1.87 $ — 75.0 % 71.0 % Renewal Leases 7 810,600 4.6 $ 2.88 $ 8.57 31.0 % 21.0 % Total / Weighted Average 8 837,400 4.5 $ 2.85 $ 8.30 32.0 % 23.0 % (1) Represents leasing activity for leases that commenced during the period.
Added
Usable Acres Weighted Average Lease Term (in years) LC (per usable acre) TI (per usable acre) GAAP Rent Change (1) Cash Rent Change (1) New Leases (2) 6 64.8 7.5 $ 9,385 $ 293 73.1 % 71.1 % Renewal Leases 4 20.0 2.2 $ — $ — 37.4 % 35.5 % Total / Weighted Average 10 84.8 6.3 $ 7,172 $ 224 55.5 % 52.8 % (1) Reported as a weighted average based on the usable acreage of the leases included in the calculation.
Removed
(2) Calculated as the change between GAAP rents for new/renewal leases and the expiring GAAP rents for the same space. (3) Calculated as the change between cash rents for new/renewal leases and the expiring cash rents for the same space. Leases Executed (1) : Number of Leases Approx.
Added
(2) Excludes GAAP Rent Change and Cash Rent Change for i) two new leases (total of 44.5 usable acres and 8.5 weighted average lease term) for two IOS properties that were re-classified from redevelopment to operating in the year and had not been leased under our ownership and (ii) a new lease (1.6 usable acres and 8.0 weighted average lease term) for a previously vacant space at an IOS property that had not been leased under our ownership.
Removed
Square Feet Weighted Average Lease Term LC (per square feet) TI (per square feet) GAAP Rent Change (2) Cash Rent Change (3) New Leases 1 26,800 2.0 $ 1.87 $ — 75.0 % 71.0 % Renewal Leases 7 810,600 4.6 $ 2.88 $ 8.57 31.0 % 21.0 % Total / Weighted Average 8 837,400 4.5 $ 2.85 $ 8.30 32.0 % 23.0 % (1) Represents leasing activity for leases that were executed during the period.
Added
Leases Commenced - Usable Acres: Number of Leases Approx.
Added
Usable Acres Weighted Average Lease Term (in years) LC (per usable acre) TI (per usable acre) GAAP Rent Change (1) Cash Rent Change (1) New Leases (2) 4 60.2 7.3 $ 4,792 $ — 88.4 % 91.9 % New Lease - Previously Executed (3) 1 3.3 6.5 $ — $ — 218.1 % 185.1 % Renewal Leases (4) 2 11.7 0.9 $ — $ — 260.1 % 237.1 % Total / Weighted Average 7 75.2 6.3 $ 3,836 $ — 131.4 % 116.2 % (1) Reported as a weighted average based on the usable acreage of the leases included in the calculation.
Added
(2) Excludes GAAP Rent Change and Cash Rent Change for i) two new leases (total of 44.5 usable acres and 8.5 weighted average lease term) for two IOS properties that were re-classified from redevelopment to operating in the year and had not been leased under our ownership.
Added
(3) Represents a new lease that was executed prior to the acquisition of the property and commenced in the current year.
Added
(4) Excludes GAAP Rent Change and Cash Rent Change for a lease renewal (total of 8.7 usable acres and 0.5 weighted average lease term) for an IOS property because the lease term was less than 12 months. 40 Table of C ontents Office Leasing Activity : Leases Executed and Commenced - Square Feet: Number of Leases Approx.
Added
Square Footage Weighted Average Lease Term LC (per square feet) TI (per square feet) GAAP Rent Change (1) Cash Rent Change (1) Renewal Leases (2) 1 2,500 0.3 $ — $ — N/A N/A Total / Weighted Average 1 2,500 0.3 $ — $ — N/A N/A (1) Reported as a weighted average based on the square footage of the leases included in the calculation.
Added
(2) Represents a lease that was executed and commenced at an Office Discontinued Operations Property. The lease was excluded from GAAP Rent Change and Cash Rent Change because the lease term is less than 12 months.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Removed
ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 35 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDividends We intend to pay dividends on a quarterly basis at the discretion of our Board, unless our results of operations, our general financial condition, general economic conditions, or other factors indicate we should refrain from doing so. Recent Sales of Unregistered Securities During the year ended December 31, 2024, there were no sales of unregistered securities.
Biggest changeDividends We intend to pay dividends on a quarterly basis at the discretion of our Board, unless our results of operations, our general financial condition, general economic conditions, or other factors indicate we should refrain from doing so, including the terms of the Merger Agreement.
The following performance graph is a comparison of the cumulative return of our common shares for the period from April 13, 2023, being the date on which the Company listed its common shares on the New York Stock Exchange (the “Listing”), through December 31, 2024.
The following performance graph is a comparison of the cumulative return of our common shares for the period from April 13, 2023, being the date on which the Company listed its common shares on the New York Stock Exchange (the “Listing”), through December 31, 2025.
Repurchases of Equity Securities During the quarter ended December 31, 2024, the Company repurchased shares as follows: For the Month Ended Total Number of Shares Repurchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) That May Yet be Purchased Under the Plans or Programs October 31, 2024 — $ — — — November 30, 2024 — $ — — — December 31, 2024 113,101 $ 11.06 — — (1) Consists of shares withheld (i.e. forfeited) pursuant to provisions of employee benefit plans that permit the repurchase of shares to satisfy statutory tax withholding obligations.
Repurchases of Equity Securities During the quarter ended December 31, 2025, the Company repurchased shares as follows: For the Month Ended Total Number of Shares Repurchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) That May Yet be Purchased Under the Plans or Programs October 31, 2025 — $ — — — November 30, 2025 — $ — — — December 31, 2025 167,255 $ 14.14 — — Total 167,255 $ 14.14 — — (1) Consists of shares withheld (i.e. forfeited) pursuant to provisions of employee benefit plans that permit the repurchase of shares to satisfy statutory tax withholding obligations.
The historical information set forth on the following performance graph is not necessarily indicative of future performance. 36 (1) Prior to the Listing, our published NAV as of June 30, 2022, June 30, 2021, and December 31, 2020, was as follows: $66.78, $81.90 and $80.55, respectively.
The historical information set forth on the following performance graph is not necessarily indicative of future performance. 42 (1) Prior to the Listing, our published NAV as of June 30, 2021, and June 30, 2022, was as follows: $81.90 and $80.55, respectively.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is listed on the NYSE under the ticker symbol “PKST”. As of February 17, 2025, there were 36,755,389 holders of record of our common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is listed on the NYSE under the ticker symbol “PKST”. As of February 13, 2026, there were 37,180,295 holders of record of our common stock.
The cumulative investment (loss) for the NAV as of June 30, 2022, June 30, 2021, and December 31, 2020, was as follows: (21.0%), (2.6%), and (4.1%) respectively. ITEM 6. [Reserved] 37
The cumulative investment (loss) for the NAV as of June 30, 2022, and June 30, 2021, was as follows: (1.7%), (16.8%), respectively. ITEM 6. [Reserved] 43
Added
Recent Sales of Unregistered Securities During the year ended December 31, 2025, there were no sales of unregistered securities.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

73 edited+62 added−30 removed24 unchanged
Biggest changeIn the future, NAREIT may decide to standardize the allowable exclusions across the REIT industry, and we may have to adjust the calculation and characterization of this non-GAAP measure. 47 Our calculation of FFO and AFFO is presented in the following table for the years ended December 31, 2024, 2023 and 2022 (in thousands, except per share amounts): Year Ended December 31, 2024 2023 2022 Net loss $ (11,363) $ (605,102) $ (441,382) Adjustments: Depreciation of building and improvements 64,191 72,273 113,191 Amortization of leasing costs and intangibles 31,179 40,318 77,926 Impairment provision, real estate 53,313 409,511 127,577 Gain (loss) from disposition of assets, net (38,368) (29,164) 139,280 Equity interest of depreciation of building and improvements - unconsolidated entity — 24,623 4,643 Company's share of loss on sale of unconsolidated entity — — 3,558 FFO $ 98,952 $ (87,541) $ 24,793 Distribution to redeemable preferred shareholders — (2,376) (10,063) Preferred units redemption charge — (4,970) — FFO attributable to common shareholders and noncontrolling interests $ 98,952 $ (94,887) $ 14,730 Reconciliation of FFO to AFFO: FFO attributable to common shareholders and noncontrolling interests $ 98,952 $ (94,887) $ 14,730 Adjustments: Revenues in excess of cash received, net (4,182) (7,953) (15,407) Amortization of share-based compensation 7,896 10,063 9,573 Deferred rent - ground lease 1,661 1,724 1,951 Unrealized loss (gain) on investments (377) 17 195 Amortization of above/(below) market rent, net (2,232) (1,240) (2,205) Amortization of debt premium/(discount), net 103 419 409 Amortization of ground leasehold interests (389) (389) (372) Amortization of below tax benefit amortization 1,498 1,494 1,494 Amortization of deferred financing costs 4,757 3,632 3,544 Amortization of lease inducements 127 150 537 Write-off of dead deal costs 140 115 28 Gain on extinguishment of debt (10,466) — — Employee separation expense 358 4,096 72 Transaction expenses 821 24,982 22,386 Impairment provision, goodwill 10,274 16,031 135,270 Lease termination and other non-recurring adjustments (2,339) — — Debt breakage costs — — 13,249 Preferred units redemption charge — 4,970 — Other income - proration adjustments for dispositions — (1,587) — Impairment provision, investment in unconsolidated entity — 129,334 — Write-off of Company's share of accumulated other comprehensive income - unconsolidated entity — (1,226) — Company’s share of amortization of deferred financing costs- unconsolidated entity — 31,061 3,740 Loss on debt breakage costs — write-off of deferred financing costs — — 1,771 Company’s share of revenues in excess of cash received (straight-line rent) - unconsolidated entity — (2,207) (257) Company's share of amortization of above/(below) market rent - unconsolidated entity — (532) (58) AFFO available to common shareholders and noncontrolling interests $ 106,602 $ 118,067 $ 190,650 FFO per share/unit, basic and diluted $ 2.50 $ (2.40) $ 0.37 AFFO per share/unit, basic and diluted $ 2.69 $ 2.99 $ 4.81 Weighted-average common shares outstanding - basic and diluted shares 36,375,053 35,988,231 36,057,825 Weighted-average OP Units outstanding (1) 3,202,727 3,472,770 3,537,654 Weighted-average common shares and OP Units outstanding - basic and diluted FFO/AFFO 39,577,780 39,461,001 39,595,479 (1) Represents weighted-average outstanding OP Units that are owned by unitholders other than Peakstone Realty Trust.
Biggest changeAs with Core FFO, our reported AFFO may not be comparable to AFFO as defined by other REITs. 57 Our calculation of FFO, Core FFO and AFFO is presented in the following table for the years ended December 31, 2025, 2024 and 2023 (in thousands, except per share amounts): Year Ended December 31, Reconciliation of Net Loss to FFO, Core FFO, and AFFO (1) : 2025 2024 2023 Net loss $ (332,633) $ (11,363) $ (605,102) FFO Adjustments: Depreciation of building and improvements 54,699 64,191 72,273 Amortization of leasing costs and intangibles 27,989 31,179 40,318 Real estate impairment provision 363,688 53,313 409,511 Gain from disposition of assets (38,878) (38,368) (29,164) Equity interest of depreciation of building and improvements - unconsolidated entity — — 24,623 FFO $ 74,865 $ 98,952 $ (87,541) Distribution to redeemable preferred shareholders — — (2,376) Preferred units redemption charge — — (4,970) FFO attributable to common shareholders and noncontrolling interests (2) $ 74,865 $ 98,952 $ (94,887) Core FFO Adjustments: Loss (gain) on extinguishment of debt 3,725 (10,466) — Impairment provision, goodwill — 10,274 16,031 Unrealized (gain) loss on investments (115) (377) 17 Employee separation expense 36 358 4,096 Transaction expenses 555 821 24,982 Lease termination adjustments (287) 107 — Preferred units redemption charge — — 4,970 Other income - proration adjustments for dispositions — — (1,587) Impairment provision, investment in unconsolidated entity — — 129,334 Write-off of Company's share of accumulated other comprehensive income - unconsolidated entity — — (1,226) Other activities adjustment (172) 364 115 Core FFO attributable to common shareholders and noncontrolling interests (2) $ 78,607 $ 100,033 $ 81,845 AFFO Adjustments: Straight-line rent adjustment (2,943) (6,852) (7,953) Amortization of share-based compensation 6,380 7,896 10,063 Deferred rent - ground lease 1,705 1,661 1,724 Amortization of below market rent, net (9,900) (2,232) (1,240) Amortization of debt (discount)/premium, net (490) 103 419 Amortization of ground leasehold interests (290) (389) (389) Amortization of below tax benefits 933 1,498 1,494 Amortization of deferred financing costs 4,966 4,757 3,632 Amortization of lease inducements — 127 150 Company’s share of straight-line rent - unconsolidated entity — — (2,207) Company’s share of amortization of deferred financing costs - unconsolidated entity — — 31,061 Company's share of amortization of below market rent - unconsolidated entity — — (532) AFFO available to common shareholders and noncontrolling interests $ 78,968 $ 106,602 $ 118,067 FFO per share/unit, basic and diluted $ 1.88 $ 2.50 $ (2.40) Core FFO per share/unit, basic and diluted $ 1.98 $ 2.53 $ 2.07 AFFO per share/unit, basic and diluted $ 1.99 $ 2.69 $ 2.99 Weighted-average common shares outstanding - basic and diluted shares 36,798,234 36,375,053 35,988,231 Weighted-average OP Units outstanding (1) 2,944,479 3,202,727 3,472,770 Weighted-average common shares and OP Units outstanding - basic and diluted 39,742,713 39,577,780 39,461,001 58 (1) FFO, Core FFO, and AFFO include amounts related to both continuing operations and Office Discontinued Operations Properties for all periods presented.
Under the quantitative assessment, the Company focuses on the fair value of real estate assets and mortgage loans, as those comprise the significant components of fair value within each reporting unit. The analysis involves estimates around significant assumptions related to market rent, discount rates, terminal capitalization rates, and borrowing rates.
Under the quantitative assessment, the Company focuses on the fair value of real estate assets and related mortgage loans, as those comprise the significant components of fair value within each reporting unit. The analysis involves estimates around significant assumptions related to market rent, discount rates, terminal capitalization rates, and borrowing rates.
Additionally, to qualify as a REIT, we must meet a number of organizational and operational requirements on a continuing basis, including the requirement that we annually distribute at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding net capital gain, to our shareholders and holders of OP Units.
Additionally, to qualify as a REIT, we must meet a number of organizational and operational requirements on a continuing basis, including the requirement that we annually distribute at least 90% of our REIT taxable income, determined without regard to the dividends and distributions paid deduction and excluding net capital gain, to our shareholders and holders of OP Units.
Recoverability of real estate assets requires estimates of future market and 45 economic conditions, including assumptions related to estimated selling prices, anticipated hold periods, potential vacancies, capitalization rates, market rental income amounts subsequent to the expiration of current lease agreements, and property operating expenses.
Recoverability of real estate assets requires estimates of future market and economic conditions, including assumptions related to estimated selling prices, anticipated hold periods, potential vacancies, capitalization rates, market rental income amounts subsequent to the expiration of current lease agreements, and property operating expenses.
However, a number of factors could have an adverse impact, including decreases in occupancy levels and rental rates, the ability and willingness of our tenants to pay rent, the timing and success of our investment activities, and general financial and economic conditions.
However, a number of factors could have an adverse impact, including decreases in occupancy levels and rental rates, the ability and willingness of our tenants to pay rent, the timing and success of our investment activities, the impact of our disposition activities, and general financial and economic conditions.
Therefore, NOI and Cash NOI should not be considered as alternatives to net income (loss), as computed in accordance with GAAP. NOI and Cash NOI may not be comparable to similarly titled measures of other companies.
Therefore, NOI and Cash NOI should not be considered as alternatives to net income or loss, as computed in accordance with GAAP. NOI and Cash NOI may not be comparable to similarly titled measures of other companies.
Net Loss from Investment in Unconsolidated Entity Net loss from investment in unconsolidated entity decreased approximately $176.8 million, or 100%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 due to the complete write-off of the Company’s indirect investment in Galaxy REIT, LLC, an office property joint venture (“Office Joint Venture”) as of September 30, 2023, in which the Company no longer recorded any equity income or losses.
Net Loss from Investment in Unconsolidated Entity Net loss from investment in unconsolidated entity decreased by approximately $176.8 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 due to the complete write-off of the Company’s indirect investment in Galaxy REIT, LLC, an office property joint venture (“Office Joint Venture”) as of September 30, 2023, in which the Company no longer recorded any equity income or losses.
Actual sales, if any, will depend on a variety of factors to be determined by us from time to time, including, among other things, market conditions, the trading price of our common shares, capital needs, and our determinations of the appropriate sources of funding. As of December 31, 2024, we have not sold any shares under the ATM program.
Actual sales, if any, will depend on a variety of factors to be determined by us from time to time, including, among other things, market conditions, the trading price of our common shares, capital needs, and our determinations of the appropriate sources of funding. As of December 31, 2025, we have not sold any shares under the ATM program.
Dividends and Distributions Dividends will be authorized at the discretion of our Board and be paid to our shareholders and holders of OP Units as of the record date selected by our Board.
Dividends and Distributions Dividends and distributions, as applicable, will be authorized at the discretion of our Board and be paid to our shareholders and holders of OP Units as of the record date selected by our Board.
The Second Amended and Restated Credit Agreement also provides the option, subject to obtaining additional commitments from lenders and certain other customary conditions, to increase the commitments under the Revolving Credit Facility, existing term loans and/or incur new term loans by up to an additional $218.0 million in the aggregate.
The Second Amended and Restated Credit Agreement also provides the option, subject to obtaining additional commitments from lenders and certain other customary conditions, to increase the commitments under the Revolving Credit Facility, to increase the existing term loans and/or incur new term loans by up to an additional $468.0 million in the aggregate.
For the year ended December 31, 2024, the following critical accounting estimates reflects what we believe are the most significant estimates, assumptions, and judgments that have had or are reasonably likely to have a material impact on our financial conditions or our results of operations.
For the year ended December 31, 2025, the following critical accounting estimates reflects what we believe are the most significant estimates, assumptions, and judgments that have had or are reasonably likely to have a material impact on our financial conditions or our results of operations.
Other Potential Sources of Capital Other potential sources of capital include proceeds from private or public offerings of our common shares or OP Units, proceeds from secured or unsecured financings from banks or other lenders, including debt assumed in a real estate transaction, and entering into joint venture arrangements to invest in assets.
Other Potential Sources of Capital Other potential sources of capital include proceeds from private or public offerings of our common shares, proceeds from secured or unsecured financings from banks or other lenders, including debt assumed in a real estate transaction, and entering into joint venture arrangements to invest in assets.
For the discounted cash flow method, the fair value of real estate is determined (i) by applying a discounted cash flow analysis to the estimated net operating income for each property in the portfolio during the remaining anticipated lease term and (ii) by the estimated residual value, which is based on a hypothetical sale of the property upon expiration of a lease factoring in the re-tenanting of such property at estimated market rental rates, and applying a selected capitalization rate.
For the discounted cash flow method, the fair value of real estate is determined (i) by applying a discounted cash flow analysis to the estimated net operating income for each property in the portfolio during the remaining anticipated lease term and over any additional hypothetical lease terms assumed and (ii) by the estimated residual value, which is based on a hypothetical sale of the property upon expiration of a lease factoring in the re-tenanting of such property at estimated market rental rates, and applying a selected capitalization rate.
Other Income, Net Other income increased $1.4 million, or 10%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to an increase in interest income earned from cash invested in money market accounts.
Other Income, Net Other income increased by $1.4 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to an increase in interest income earned from cash invested in money market accounts.
As of December 31, 2024, the available undrawn capacity under the Revolving Credit Facility was $82.0 million. ATM Program In August 2023, we entered into an at-the-market equity offering (the “ATM”) pursuant to which we may sell common shares up to an aggregate purchase price of $200.0 million.
As of December 31, 2025, the available undrawn capacity under the Revolving Credit Facility was $240.7 million. ATM Program In August 2023, we entered into an at-the-market equity offering (the “ATM”) pursuant to which we may sell common shares up to an aggregate purchase price of $200.0 million.
Net Gain from Disposition of Assets Gain from disposition of assets increased approximately $9.2 million, or 32%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to increased number of sales with realized gains in 2024.
Gain from Disposition of Assets Gain from disposition of assets increased by approximately $9.2 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to increased number of sales with realized gains in 2024.
Under the cost approach, the fair value of real estate is based on estimated costs to construct a vacant building with similar characteristics. Under the income approach, we use the discounted cash flow method, which includes Level 3 unobservable inputs.
Under the cost approach, the fair value of real estate is based on estimated costs to construct a vacant building or site improvement, as applicable, with similar characteristics. Under the income approach, we use the discounted cash flow method, which includes Level 3 unobservable inputs.
To the extent we are not able to secure other potential sources of capital, we will be heavily dependent upon income from operations and our current financing. Sources of Liquidity Cash Resources As of December 31, 2024, we had approximately $146.5 million of cash and cash equivalents on hand.
To the extent we are not able to secure other potential sources of capital, we will be heavily dependent upon income from operations and our current financing. Sources of Liquidity Cash Resources As of December 31, 2025, we had approximately $138.7 million of cash and cash equivalents on hand.
Corporate Operating Expense to Related Parties Corporate operating expenses to related parties decreased $0.5 million, or 47%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 due to the termination of the Administrative Services Agreement in 2023.
Corporate Operating Expense to Related Parties Corporate operating expenses to related parties decreased by $0.5 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 due to the termination of the Administrative Service Agreement in 2023.
Credit Facility As of December 31, 2024, pursuant to the Second Amended and Restated Credit Agreement with KeyBank National Association, as administrative agent, and a syndicate of lenders, the Operating Partnership, as the borrower, has been provided with a $1.1 billion credit facility (with the right to elect to increase total commitments to $1.3 billion) consisting of (i) a $547.0 million senior unsecured revolving credit facility (the “Revolving Credit Facility”), under which the Operating Partnership has drawn $465.0 million (the “Revolving Loan”) maturing in July 2028, (ii) a $210.0 million senior unsecured term loan maturing in July 2028 (the “2028 Term Loan I”), (iii) a $175.0 million senior unsecured term loan maturing in October 2028, assuming the one-year extension option is exercised (the “2028 Term Loan II”) and (iv) a $150.0 million senior unsecured term loan maturing in April 2026 (the “2026 Term Loan” and together with the Revolving Loan, the 2028 Term Loan I and the 2028 Term Loan II, the “KeyBank Loans”).
Credit Facility As of December 31, 2025, pursuant to the Second Amended and Restated Credit Agreement with KeyBank National Association, as administrative agent, and a syndicate of lenders, the Operating Partnership, as the borrower, has been provided with a $832.0 million credit facility (with the right to elect to increase total commitments to $1.3 billion) consisting of (i) a $547.0 million senior unsecured revolving credit facility (the “Revolving Credit Facility”), under which the Operating Partnership had no amounts drawn (the “Revolving Loan”), (ii) a $110.0 million senior unsecured term loan maturing in July 2028 (the “2028 Term Loan I”), and (iii) a $175.0 million senior unsecured term loan maturing in October 2028, assuming the one-year extension option is exercised (the “2028 Term Loan II” and together with the Revolving Loan and the 2028 Term Loan I, the “KeyBank Loans”).
General and Administrative Expenses General and administrative expenses decreased $6.0 million, or 14%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to the vesting of certain time-based restricted share units and time-based restricted shares (together, “Restricted Share Units”) in the prior year, including accelerated vesting for employee severances.
General and Administrative Expenses 53 General and administrative expenses decreased by $5.9 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to the vesting of certain time-based restricted share units and time-based restricted shares (together, “Restricted Share Units”) in the prior year, including accelerated vesting for employee severances.
Interest Expense Interest expense decreased $3.6 million, or 5%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to debt payoffs in 2023 and 2024.
Interest Expense Interest expense decreased by $3.4 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to debt payoffs in 2023 and 2024.
For asset acquisitions, the Company allocates the acquisition cost, which assigns both cash and non-cash consideration paid to the seller and associated acquisition transaction costs, to the individual assets acquired and liabilities assumed, according to their respective relative fair values. The tangible assets consist of land, buildings, and site improvements.
For asset acquisitions, the Company allocates the acquisition cost, which assigns both cash and non-cash consideration paid to the seller and associated acquisition transaction costs, to the individual assets acquired and liabilities assumed (including tangible assets and intangible assets and liabilities), according to their respective relative fair values.
NOI on a cash basis (“Cash NOI”) is NOI adjusted to exclude the effect of straight-line rent and amortization of acquired above- and below-market lease intangibles adjustments required by GAAP.
NOI on a cash basis (“Cash NOI”) is NOI adjusted to exclude the effect of straight-line rent, amortization of acquired above- and below-market lease intangibles, deferred termination income, other deferred adjustments and amortization of other intangibles.
For the years ended December 31, 2024 and 2023, the Company recorded a net loss of $11.4 million and $605.1 million.
Portfolio Analysis Comparison of the Years Ended December 31, 2024 to the Year Ended December 31, 2023 Net Loss For the years ended December 31, 2024 and 2023, the Company recorded a net loss of $11.4 million and $605.1 million, respectively.
Extinguishment of Debt Extinguishment of debt increased approximately $10.5 million, or 100%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to the gain on extinguishment recognized as a result of the Company’s final sale of secured AIG properties on December 31, 2024, which relieved the Company of its remaining debt obligations under the AIG Loans.
Gain on extinguishment of Debt Gain on extinguishment of debt increased by approximately $10.5 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to the gain on extinguishment recognized as a result of the Company’s final sale of secured AIG properties on December 31, 2024, which relieved the Company of its remaining debt obligations under the AIG Loans. 54 Transaction Expenses Transaction expenses decreased by approximately $24.1 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily because the Listing related expenses were incurred in 2023.
Represents the noncontrolling interest in the Operating Partnership. 48 NOI and Cash NOI NOI is a non-GAAP financial measure calculated as net (loss) income, the most directly comparable financial measure calculated and presented in accordance with GAAP, excluding general and administrative expenses, interest expense, depreciation and amortization, impairment of real estate, impairment of goodwill, gains or losses on early extinguishment of debt, gains or losses on sales of real estate, investment income or loss, termination income and equity in earnings of any unconsolidated real estate joint ventures.
NOI and Cash NOI Net operating income (“NOI”) is a non-GAAP financial measure calculated as net income or loss, the most directly comparable financial measure calculated and presented in accordance with GAAP, excluding (to the extent applicable during the periods presented) general and administrative expenses, corporate operating expenses to related parties, impairment of real estate, depreciation and amortization, interest expense, other income, net, gains or losses on early extinguishment of debt, gains or losses on sales of real estate, impairment of goodwill, investment income or loss, transaction expense and net income or loss from discontinued operations and equity in earnings of unconsolidated real estate joint ventures.
Real Estate Impairment Provision Real estate impairment decreased $356.2 million, or 87%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 due to fewer impairments in 2024 compared to 2023.
Real Estate Impairment Provision Real estate impairment decreased by $230.5 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 due to fewer impairment charges in 2024 compared to 2023.
The estimated fair value of acquired in-place at-market tenant leases is estimated based on the costs that would have been incurred to lease the property to the occupancy level at the acquisition date. This includes leasing commissions, legal and other costs, along with the estimated time necessary to lease the property to its occupancy level at the time of acquisition.
The estimated fair value of acquired in-place at-market tenant leases is estimated based on the costs that would have been incurred to lease the property to the occupancy 55 level at the acquisition date.
FFO is defined as net income or loss computed in accordance with GAAP, excluding extraordinary items, as defined by GAAP, and gains and losses from sales of depreciable real estate assets, adding back impairment write-downs of depreciable real estate assets, plus real estate related depreciation and amortization (excluding amortization of deferred financing costs and depreciation of non-real estate assets), and after adjustment for unconsolidated partnerships, joint ventures and preferred dividends.
FFO is defined as net income or loss computed in accordance with GAAP, excluding real estate related depreciation and amortization, impairment losses of depreciable real estate assets, gains (losses) from sales of depreciable real estate assets and after adjustments for unconsolidated joint ventures.
It should be noted, however, that other REITs may not define FFO in accordance with the current NAREIT definition or may interpret the current NAREIT definition differently than we do, making comparisons less meaningful. 46 Additionally, we use AFFO as a non-GAAP financial measure to evaluate our operating performance.
It should be noted, however, that other REITs may not define FFO in accordance with the current NAREIT definition or may interpret the current NAREIT definition differently than we do, making comparisons less meaningful.
Industrial NOI increased $6.0 million, or 12%, primarily due to the acquisition of the IOS Portfolio and increased leasing activity in 2024. Office NOI decreased $8.6 million, or 7%, primarily due to property dispositions. Other NOI decreased $14.9 million, or 44%, primarily due to property dispositions.
Industrial NOI increased by $6.0 million primarily due to the acquisition of IOS properties in 2024 and increased leasing activity in 2024. Office NOI decreased by $9.4 million primarily due to property dispositions in 2023 and 2024.
Goodwill Impairment Provision The Company recorded $10.3 million of goodwill impairment in 2024 related to its Other segment, which represents the complete write-off of the Other segment goodwill resulting from the final disposition of the Other segment property as of December 31, 2024. 43 Depreciation and Amortization Depreciation and amortization decreased $17.2 million, or 15%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to (i) property dispositions in 2023 and 2024; (ii) accelerated amortization due to expired and terminated leases; and (iii) real estate impairments, which lowered the depreciable book bases of the impaired assets, partially offset by (iv) the acquisition of the IOS Portfolio in fourth quarter of 2024.
Depreciation and Amortization Depreciation and amortization decreased by $13.7 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to (i) property dispositions in 2023 and 2024; (ii) accelerated amortization due to expired and terminated leases; and (iii) real estate impairments, which lowered the depreciable book bases of the impaired assets, partially offset by (iv) the acquisition of the IOS Portfolio in fourth quarter of 2024.
The CODM evaluates the Company's portfolio and assesses the ongoing operations and performance of its properties utilizing the following reportable segments: Industrial and Office.
The CODM evaluates the Company's portfolio and assesses the ongoing operations and performance of its properties within each reportable segment.
If a lease is terminated, we charge the unamortized portion of above- and below-market lease values to rental income and in-place lease values to amortization expense. If a lease is amended, we will determine whether the economics of the amended lease continue to support the existence of the above- or below-market lease intangibles.
If a lease is amended, we will determine whether the economics of the amended lease continue to support the existence of the above- or below-market lease intangibles.
The intangible assets include the above- and below-market value of leases and the in-place leases, which include the value of tenant relationships. Land is typically valued utilizing the sales comparison (or market) approach. Buildings are valued, as if vacant, using the cost and/or income approach. Site improvements are valued using the cost approach.
Tangible Assets Acquired The tangible assets consist of land, buildings, and site improvements. Land is typically valued utilizing the sales comparison (or market) approach. Buildings are valued, as if vacant, using the cost and/or income approach. Site improvements are valued using the cost approach.
The following table reconciles net loss to NOI for the years ended December 31, 2024 and 2023 (dollars in thousands): Year Ended December 31, 2024 2023 Increase/(Decrease) Percentage Change Reconciliation of Net (Loss) Income to NOI Net loss $ (11,363) $ (605,102) $ 593,739 (98) % General and administrative expenses 36,973 42,962 (5,989) (14) % Corporate operating expenses to related parties 617 1,154 (537) (47) % Real estate impairment provision 53,313 409,512 (356,199) (87) % Goodwill impairment provision 10,274 16,031 (5,757) (36) % Depreciation and amortization 94,982 112,204 (17,222) (15) % Interest expense 62,050 65,623 (3,573) (5) % Other income, net (14,482) (13,111) (1,371) 10 % Net loss from investment in unconsolidated entity — 176,767 (176,767) (100) % Net gain from disposition of assets (38,368) (29,164) (9,204) 32 % Gain on extinguishment of debt (10,466) — (10,466) 100 % Transaction expenses 821 24,982 (24,161) (97) % Total NOI $ 184,351 $ 201,858 $ (17,507) (9) % The following table provides further detail regarding segment NOI for the years ended December 31, 2024 and 2023 (dollars in thousands): 42 Year Ended December 31, 2024 2023 Increase/Decrease Percentage Change Industrial NOI Industrial revenues $ 64,750 $ 57,304 $ 7,446 13 % Industrial operating expenses (9,072) (7,655) (1,417) 19 % Industrial NOI 55,678 49,649 6,029 12 % Office NOI Office revenues 132,541 142,734 (10,193) (7) % Office operating expenses (22,703) (24,295) 1,592 (7) % Office NOI 109,838 118,439 (8,601) (7) % Other NOI Other revenues 30,782 54,246 (23,464) (43) % Other operating expenses (11,947) (20,476) 8,529 (42) % Other NOI 18,835 33,770 (14,935) (44) % Total NOI $ 184,351 $ 201,858 $ (17,507) (9) % NOI Total NOI decreased by $17.5 million, or 9%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023.
The reasons for the change are discussed below. 52 The following table reconciles net loss to NOI for the years ended December 31, 2024 and 2023 (dollars in thousands): Year Ended December 31, 2024 2023 Increase/(Decrease) Percentage Change Reconciliation of Net Loss to NOI Net loss $ (11,363) $ (605,102) $ 593,739 (98) % General and administrative expenses 36,973 42,843 (5,870) (14) % Corporate operating expenses to related parties 617 1,154 (537) (47) % Real estate impairment provision 53,313 283,804 (230,491) (81) % Depreciation and amortization 47,503 61,169 (13,666) (22) % Interest expense 55,978 59,371 (3,393) (6) % Other income, net (14,479) (13,107) (1,372) 10 % Loss from investment in unconsolidated entities — 176,767 (176,767) (100) % Gain on extinguishment of debt (10,466) — (10,466) (100) % Gain from disposition of assets (38,368) (29,164) (9,204) 32 % Goodwill impairment provision 10,274 16,031 (5,757) (36) % Transaction expenses 821 24,961 (24,140) (97) % Net (income) loss from discontinued operations (38,028) 92,361 (130,389) (141) % Total NOI $ 92,775 $ 111,088 $ (18,313) (16) % The following table provides further detail regarding segment NOI: Year Ended December 31, 2024 2023 Increase/(Decrease) Percentage Change Industrial NOI Industrial revenues $ 64,750 $ 57,304 $ 7,446 13 % Industrial operating expenses (9,072) (7,655) (1,417) 19 % Industrial NOI 55,678 49,649 6,029 12 % Office NOI Office revenues 20,825 32,288 (11,463) (36) % Office operating expenses (2,563) (4,619) 2,056 (45) % Office NOI 18,262 27,669 (9,407) (34) % Other NOI Other revenues 30,782 54,246 (23,464) (43) % Other operating expenses (11,947) (20,476) 8,529 (42) % Other NOI 18,835 33,770 (14,935) (44) % Total NOI $ 92,775 $ 111,088 $ (18,313) (16) % NOI Total NOI decreased by $18.3 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023.
In assessing the fair value of intangible lease assets or liabilities, the Company, similarly, considers Level 3 inputs.
Intangible Assets and Liabilities Acquired The intangible assets and liabilities include the above- and below-market value of leases and the in-place leases, which include the value of tenant relationships. In assessing the fair value of intangible lease assets or liabilities, the Company, similarly, considers Level 3 inputs.
Refer to Note 3, Real Estate , to our consolidated financial statements included in this Annual Report on Form 10-K for details.
Refer to Note 8, Fair Value Measurements , to our consolidated financial statements included in this Annual Report on Form 10-K for additional details related to impairment of goodwill.
The preparation of our consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses.
Refer to Note 2, Basis of Presentation and Summary of Significant Accounting Policies , for further information. Critical Accounting Estimates We have established accounting estimates which conform to GAAP. The preparation of our consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses.
If necessary, we may use these other sources of capital in the event of unforeseen expenditures. 51 Uses of Liquidity During the next 12 months following December 31, 2024 and thereafter, we expect our significant cash requirements will include: • making scheduled principal and interest payments on our outstanding debt obligations (see “ Debt and Ground Lease Obligations ” section below); • paying dividends and distributions to our shareholders (refer to “ Dividends and Distributions ” section below); • making scheduled ground lease obligations (see “ Debt and Ground Lease Obligations ” section below); • funding future capital expenditures, leasing commissions and tenant improvements (as of December 31, 2024, the aggregate remaining contractual commitment was approximately $9.1 million); and • other normal recurring operating expenses.
If necessary, we may use other sources of capital in the event of unforeseen expenditures. 61 Uses of Liquidity As of December 31, 2025, we expect our significant short-term and long-term liquidity requirements will include: • making scheduled principal and interest payments on our outstanding debt obligations (see “ Debt and Lease Obligations ” section below); • making scheduled payments on our corporate office lease obligations (see “ Debt and Lease Obligations ” section below); • paying dividends and distributions approved by the Board, including those necessary to maintain the Company’s REIT status under the Code (refer to “ Dividends and Distributions ” section below); • funding contractual commitments, including operating expenses and capital expenses (as of December 31, 2025,the aggregate remaining contractual capital expenses commitment was approximately $2.2 million); and • funding future property acquisitions.
The Company considers segment NOI to be an appropriate supplemental measure to net income because it assists both investors and management in understanding the core operations and valuations of our properties. On December 31, 2024, the Company sold its final property in the Other segment, and as a result, the Other segment was eliminated.
The Company considers segment NOI to be an appropriate supplemental measure to net income or loss because it assists both investors and management in understanding the core operations of our properties. Industrial Segment As of December 31, 2025, the Company’s portfolio consisted of 76 properties within one reportable Industrial segment.
Cash used in financing activities for the year ended December 31, 2024 and 2023 consisted of the following (in thousands): Year Ended December 31, 2024 2023 Change Sources of cash provided by (used in) financing activities: Proceeds from borrowings - Credit Facility $ 280,000 $ 400,000 $ (120,000) Proceeds from borrowings - Term Loan 175,000 — 175,000 Proceeds from borrowings - Mortgage debt 110,326 — 110,326 Total sources of cash provided by financing activities $ 565,326 $ 400,000 $ 165,326 Uses of cash for financing activities: Principal payoff of secured indebtedness - Mortgage Debt (225,228) (41,283) (183,945) Principal payoff of indebtedness - Term Loan (190,000) (400,000) 210,000 Principal pay down of indebtedness - Credit Facility (215,000) — (215,000) Principal amortization payments on secured indebtedness (5,655) (6,973) 1,318 Deferred financing costs (17,286) (3,530) (13,756) Redemption of preferred units — (125,000) 125,000 Offering costs (143) (796) 653 Repurchase of common shares — (4,443) 4,443 Repurchase of common shares to satisfy employee tax withholding requirements (1,329) (2,625) 1,296 Dividends paid on preferred units subject to redemption — (4,891) 4,891 Distributions to noncontrolling interests (2,892) (3,974) 1,082 Distributions to common shareholders (33,077) (40,807) 7,730 Financing lease payment (332) (319) (13) Total sources of cash used in financing activities $ (690,942) $ (634,641) $ (56,301) Net cash (used in) provided by financing activities $ (125,616) $ (234,641) $ 109,025 55
Cash used in financing activities for the years ended December 31, 2025 and 2024 consisted of the following (in thousands): Year Ended December 31, 2025 2024 Change Sources of cash provided by financing activities: Proceeds from borrowings - Credit facility $ — $ 280,000 $ (280,000) Proceeds from borrowings - Term loan — 175,000 (175,000) Proceeds from borrowings - Mortgage debt — 110,326 (110,326) Total sources of cash provided by financing activities $ — $ 565,326 $ (565,326) Sources of cash used in financing activities: Principal pay down of indebtedness - Credit facility (465,000) (215,000) (250,000) Principal payoff of indebtedness - Term loan (250,000) (190,000) (60,000) Principal payoff of secured indebtedness - Mortgage debt (159,390) (225,228) 65,838 Principal amortization payments on secured indebtedness — (5,655) 5,655 Payment for debt extinguishment (3,362) — (3,362) Deferred financing costs — (17,286) 17,286 Offering costs (37) (143) 106 Repurchase of common shares to satisfy employee tax withholding requirements (1,204) (1,329) 125 Repurchase of noncontrolling interest (42) — (42) Distributions to noncontrolling interests (2,300) (2,892) 592 Dividends to common shareholders (28,903) (33,077) 4,174 Financing lease payment (348) (332) (16) Total sources of cash used in financing activities $ (910,586) $ (690,942) $ (219,644) Net cash used in financing activities $ (910,586) $ (125,616) $ (784,970) 65
As of December 31, 2024, the applicable rates were 4.40% (SOFR, as calculated per the credit facility), plus spreads of 0.01% (2026 Term Loan), 1.60% (2028 Term Loan I), 1.60% (2028 Term Loan II), and 1.65% (Revolving Loan) and a 0.1% index.
(7) The Contractual Interest Rate for the Company’s unsecured debt uses the applicable SOFR. As of December 31, 2025, the applicable rates were 3.66% (SOFR, as calculated per the credit facility), plus spreads of 1.80% (Revolving Loan), 1.75% (2028 Term Loan I) and 1.75% (2028 Term Loan II) and a 0.1% index.
As of December 31, 2024, the Company believes it has satisfied the REIT requirements and all distributions were classified as return on capital. 52 Outstanding Indebtedness As of December 31, 2024 and December 31, 2023, the Company’s consolidated debt consisted of the following: December 31, 2024 2023 Contractual Interest Rate (1) Effective Interest Rate (2) Loan Maturity (3) Secured Debt BOA II Loan $ 250,000 $ 250,000 4.32% 4.37% May 2028 Georgia Mortgage Loan (4) 37,722 — 5.31% 5.31% November 2029 Illinois Mortgage Loan (4) 23,000 — 6.51% 6.51% November 2029 Florida Mortgage Loan (4) 49,604 — 5.48% 5.48% May 2032 AIG Loan (5) — 92,444 —% —% — AIG Loan II (5) — 119,953 —% —% — Highway 94 Mortgage Loan (6) — 11,709 —% —% — Pepsi Bottling Ventures Mortgage Loan (7) — 17,439 —% —% — Total Secured Debt 360,326 491,545 Unsecured Debt (8) Revolving Loan 465,000 400,000 SOF Rate + 1.65% 5.09% July 2028 2026 Term Loan 150,000 150,000 SOF Rate + 1.25% 3.36% April 2026 2028 Term Loan I (9) 210,000 400,000 SOF Rate + 1.60% 3.72% July 2028 2028 Term Loan II (10) 175,000 — SOF Rate + 1.60% 3.72% October 2028 Total Unsecured Debt 1,000,000 950,000 4.30% Total Debt 1,360,326 1,441,545 4.43% Unamortized Deferred Financing Costs and Discounts, net (15,707) (5,622) Total Debt, net $ 1,344,619 $ 1,435,923 (1) The Contractual Interest Rate for the Company’s unsecured debt uses the applicable Secured Overnight Financing Rate ("SOFR" or “SOF rate").
As of December 31, 2025, the Company believes it has satisfied the REIT requirements and all distributions were classified as return on capital. 62 Outstanding Indebtedness As of December 31, 2025 and 2024, the Company’s consolidated debt consisted of the following (dollars in thousands): Carrying Value December 31, 2025 2024 Contractual Interest Rate Effective Interest Rate (1) Loan Maturity (2) Secured Debt BOA II Loan (3) $ 90,610 $ 250,000 4.32% 4.37% May 2028 Georgia Mortgage Loan (4) 37,722 37,722 5.31% 5.31% November 2029 Illinois Mortgage Loan (5) 23,000 23,000 6.51% 6.60% November 2029 Florida Mortgage Loan (6) 49,604 49,604 5.48% 5.48% May 2032 Total Secured Debt 200,936 360,326 5.08% Unsecured Debt (7) Revolving Loan (8) — 465,000 SOF Rate + 1.80% 5.56% (8) July 2028 (8) 2026 Term Loan (9) — 150,000 —% —% — (9) 2028 Term Loan I (10) 110,000 210,000 SOF Rate + 1.75% 5.51% July 2028 (10) 2028 Term Loan II (11) 175,000 175,000 SOF Rate + 1.75% 5.51% October 2028 (11) Total Unsecured Debt 285,000 1,000,000 5.51% Total Debt 485,936 1,360,326 5.33% Unamortized Deferred Financing Costs, Premiums, and Discounts, net (11,930) (15,707) Total Debt, net $ 474,006 $ 1,344,619 (1) The Effective Interest Rate is calculated on a weighted average basis, using the Actual/360 interest method (where applicable), and is inclusive of the Company's floating to fixed interest rate swaps maturing on July 1, 2029 and have the effect of converting the applicable Secured Overnight Financing Rate (SOFR) to a weighted average fixed rate of 3.58%.
The following table provides a comparative summary of the results of operations for our Same Store portfolio for the years ended December 31, 2024 and 2023 (dollars in thousands): 41 Year Ended December 31, 2024 2023 Increase/ (Decrease) Percentage Change Industrial Same Store NOI Total Industrial revenues $ 59,286 $ 56,951 $ 2,335 4 % Industrial operating expenses (8,456) (7,623) (833) 11 % Industrial Same Store NOI 50,830 49,328 1,502 3 % Office Same Store NOI Total Office revenues 131,816 130,268 1,548 1 % Office operating expenses (22,706) (22,187) (519) 2 % Office Same Store NOI 109,110 108,081 1,029 1 % Total Same Store NOI $ 159,940 $ 157,409 $ 2,531 2 % Same Store NOI Total Same Store NOI increased by $2.5 million, or 2%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023.
Comparison of the Years Ended December 31, 2024 to the Year Ended December 31, 2023 The following table provides a comparative summary of the results of operations for our Same Store portfolio for the years ended December 31, 2024 and 2023 (dollars in thousands): 51 Year Ended December 31, 2024 2023 Increase/(Decrease) Percentage Change Industrial Same Store NOI Total Industrial revenues $ 59,286 $ 56,950 $ 2,336 4 % Industrial operating expenses (8,456) (7,622) (834) 11 % Industrial Same Store NOI 50,830 49,328 1,502 3 % Office Same Store NOI Office revenues $ 20,099 $ 19,823 $ 276 1 % Office operating expenses (2,565) (2,512) (53) 2 % Office Same Store NOI 17,534 17,311 223 1 % Total Same Store NOI $ 68,364 $ 66,639 $ 1,725 3 % Total Same Store NOI Total Same Store NOI increased by $1.7 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023.
PKST OP, L.P., our operating partnership (the “Operating Partnership”), owns, directly and indirectly all of the Company’s assets. As of December 31, 2024, the Company owned, directly and indirectly through a wholly-owned subsidiary, approximately 93.0% of the outstanding common units of limited partnership interest in the Operating Partnership (“OP Units”).
As of December 31, 2025, the Company owned, directly and indirectly through a wholly-owned subsidiary, approximately 93.2% of the outstanding common units of limited partnership interest in the Operating Partnership (“OP Units”). As of December 31, 2025, our portfolio consisted of 76 industrial properties within one reportable segment (the “Industrial” segment).
The Industrial segment consists of i) industrial outdoor storage (“IOS”) properties which have a low building-to-land ratio, or low coverage, maximizing yard space for the display, movement, and storage of materials and equipment and ii) more “traditional” industrial assets which include distribution, warehouse and light manufacturing properties. The Office segment includes office, R&D and data center properties.
The portfolio included 60 IOS properties and 16 Traditional Industrial properties. IOS properties have a low building-to-land ratio, or low coverage, maximizing yard space for the display, movement and storage of materials and equipment. “Traditional Industrial” properties include distribution, warehouse, and light manufacturing facilities.
Operating Activities. Cash flows provided by operating activities are primarily dependent occupancy levels, rental rates, the ability and willingness of our tenants to pay rent, the timing and success of our investment activities, and general financial and economic conditions.
Operating Activities. Cash flows provided by operating activities are primarily dependent on the occupancy level, the rental rates of our leases, the collectability of rent and recovery of operating expenses from our tenants, and the timing and success of our investing activities.
Our calculation of each of NOI and Cash NOI is presented in the following table for the year ended December 31, 2024, 2023 and 2022 (dollars in thousands): Year Ended December 31, 2024 2023 2022 Reconciliation of Net (Loss) Income to NOI Net loss $ (11,363) $ (605,102) $ (441,382) General and administrative expenses 36,973 42,962 38,995 Corporate operating expenses to related parties 617 1,154 1,349 Real estate impairment provision 53,313 409,512 127,577 Goodwill impairment provision 10,274 16,031 135,270 Depreciation and amortization 94,982 112,204 190,745 Interest expense 62,050 65,623 84,816 Debt breakage costs — — 13,249 Other income (expense), net (14,482) (13,111) 943 Net loss from investment in unconsolidated entity — 176,767 9,993 Net gain (loss) from disposition of assets (38,368) (29,164) 139,280 Gain on extinguishment of debt (10,466) — — Transaction expenses 821 24,982 22,386 Total NOI $ 184,351 $ 201,858 $ 323,221 49 Year Ended December 31, 2024 2023 2022 Cash NOI Adjustments Industrial: Industrial NOI $ 55,678 $ 49,649 $ 53,477 Straight-line rents (4,931) (344) (1,018) Amortization of acquired lease intangibles (1,455) (384) (369) Deferred termination income 819 (24) (39) Industrial Cash NOI 50,111 48,897 52,051 Office: Office NOI 109,838 118,439 230,967 Straight-line rents (2,690) (9,046) (12,207) Amortization of acquired lease intangibles (515) (306) (1,346) Deferred termination income 1,851 — — Deferred ground lease 1,701 1,739 1,945 Other intangible amortization 1,498 1,494 1,495 Inducement amortization — 150 537 Office Cash NOI 111,683 112,470 221,391 Other: Other NOI 18,835 33,770 38,777 Straight-line rents 769 1,461 634 Amortization of acquired lease intangibles (262) (549) (489) Deferred termination income — — (2,779) Deferred ground lease (40) (15) 5 Inducement amortization 127 — — Other Cash NOI 19,429 34,667 36,148 Total Cash NOI $ 181,223 $ 196,034 $ 309,590 50 Liquidity and Capital Resources Overview We believe that cash flow generated from our properties, including proceeds from dispositions, will continue to enable us to fund our normal operating expenses, regular debt service obligations, capital expenditures, possible acquisitions of, or investments in, assets, and all dividends and distribution requirements in accordance with applicable REIT requirements in both the short-term and long-term.
Our calculation of each of NOI and Cash NOI is presented in the following tables for the year ended December 31, 2025, 2024 and 2023 (dollars in thousands): Year Ended December 31, 2025 2024 2023 Reconciliation of Net Loss to NOI Net loss $ (332,633) $ (11,363) $ (605,102) General and administrative expenses 34,918 36,973 42,843 Corporate operating expenses to related parties 570 617 1,154 Real estate impairment provision 18,195 53,313 283,804 Goodwill impairment provision — 10,274 16,031 Depreciation and amortization 52,182 47,503 61,169 Interest expense 56,565 55,978 59,371 Other income, net (7,351) (14,479) (13,107) Net loss from investment in unconsolidated entity — — 176,767 Gain from disposition of assets (6,407) (38,368) (29,164) Loss (gain) on extinguishment of debt 2,482 (10,466) — Transaction expenses 555 821 24,961 Net income (loss) from discontinued operations 272,610 (38,028) 92,361 Total NOI $ 91,686 $ 92,775 $ 111,088 59 Year Ended December 31, 2025 2024 2023 Cash NOI Adjustments Industrial: Industrial NOI $ 86,218 $ 55,678 $ 49,649 Straight-line rent (3,172) (4,931) (344) In-place lease amortization (9,383) (1,455) (384) Deferred termination income (783) 819 (24) Other deferred adjustments 20 — — Industrial Cash NOI 72,900 50,111 48,897 Office: Office NOI 5,468 18,262 27,669 Straight-line rent 75 (176) (4,068) In-place lease amortization (24) 32 33 Deferred termination income (652) 1,851 — Inducement amortization — — 150 Office Cash NOI 4,867 19,969 23,784 Other: Other NOI — 18,835 33,770 Straight-line rent — 769 1,461 In-place lease amortization — (262) (549) Other deferred adjustments — (40) (15) Inducement amortization — 127 — Other Cash NOI — 19,429 34,667 Total Cash NOI $ 77,767 $ 89,509 $ 107,348 60 Liquidity and Capital Resources Overview We believe that cash flow generated from our properties will continue to enable us to fund our normal operating expenses, regular debt service obligations, capital expenditures, possible acquisitions of, or investments in, assets, and all dividends and distribution requirements in accordance with applicable REIT requirements in both the short-term and long-term.
We expect to pay dividends on a quarterly basis unless our results of operations, our general financial condition, general economic conditions, or other factors inhibit us from doing so. During the three months ended December 31, 2024, our Board declared an all-cash distributions in the amount of $0.225 per common share or OP Unit.
We expect to pay dividends and distributions, as applicable, on a quarterly basis unless our results of operations, our general financial condition, general economic conditions, or other factors inhibit us from doing so, including the terms of the Merger Agreement.
The following table reconciles net loss to Same Store NOI for the years ended December 31, 2024 and December 31, 2023 (dollars in thousands): Year Ended December 31, 2024 2023 Reconciliation of Net Loss to Same Store NOI Net loss $ (11,363) $ (605,102) General and administrative expenses 36,973 42,962 Corporate operating expenses to related parties 617 1,154 Real estate impairment provision 53,313 409,512 Goodwill impairment provision 10,274 16,031 Depreciation and amortization 94,982 112,204 Interest expense 62,050 65,623 Other income (expense), net (14,482) (13,111) Net loss from investment in unconsolidated entity — 176,767 Net gain (loss) from disposition of assets (38,368) (29,164) Gain on extinguishment of debt (10,466) — Transaction expenses 821 24,982 Total NOI $ 184,351 $ 201,858 Same Store Adjustments: Adjustment for Acquired Properties (1) (4,848) — Adjustment for Disposed Properties (2) (19,525) (44,465) Corporate related adjustment (38) 16 Total Same Store NOI $ 159,940 $ 157,409 (1) “Acquired Properties” represent (a) for 2023, all properties acquired by the Company from January 1, 2023 through December 31, 2023; and (b) for 2024, all properties acquired by the Company from January 1, 2024 through December 31, 2024.
Refer to the NOI and Cash NOI sections for further details: Year Ended December 31, 2024 2023 Reconciliation of Net Loss to Same Store NOI Net loss $ (11,363) $ (605,102) General and administrative expenses 36,973 42,843 Corporate operating expenses to related parties 617 1,154 Real estate impairment provision 53,313 283,804 Depreciation and amortization 47,503 61,169 Interest expense 55,978 59,371 Other income, net (14,479) (13,107) Loss from investment in unconsolidated entities — 176,767 Gain on extinguishment of debt (10,466) — Gain from disposition of assets (38,368) (29,164) Goodwill impairment provision 10,274 16,031 Transaction expenses 821 24,961 Net (income) loss from discontinued operations (38,028) 92,361 Total NOI $ 92,775 $ 111,088 Same Store Adjustments: Adjustment for acquired properties (4,848) — Adjustment for disposed properties (19,525) (44,465) Corporate related adjustment (38) 16 Total Same Store NOI $ 68,364 $ 66,639 Same Store Analysis For the years ended December 31, 2024 and December 31, 2023, our Same Store portfolio was comprised of 25 properties, including 19 Industrial segment properties (all of which were Traditional Industrial properties) and six Office segment properties, encompassing approximately 9.9 million square feet.
Summary of Cash Flows Comparison of cash flow activity as of December 31, 2024 and December 31, 2023 is as follows (in thousands): Year Ended December 31, 2024 2023 Change Net cash provided by operating activities $ 94,655 $ 89,152 $ 5,503 Net cash (used in) provided by investing activities $ (215,839) $ 308,555 $ (524,394) Net cash used in financing activities $ (125,616) $ (234,641) $ 109,025 Cash and cash equivalents, and restricted cash were $154.2 million and $401.0 million as of December 31, 2024 and December 31, 2023 respectively.
The Company was in compliance with all of its debt covenants as of December 31, 2025. 63 Summary of Cash Flows Comparison of cash flow activity as of December 31, 2025 and December 31, 2024 is as follows (in thousands): Year Ended December 31, 2025 2024 Change Net cash provided by operating activities $ 68,721 $ 94,655 $ (25,934) Net cash provided by (used in) investing activities $ 834,095 $ (215,839) $ 1,049,934 Net cash used in financing activities $ (910,586) $ (125,616) $ (784,970) Cash and cash equivalents, and restricted cash were $146.4 million and $154.2 million as of December 31, 2025 and December 31, 2024 respectively.
In the industrial sector, trends including onshoring and nearshoring of manufacturing and warehousing operations, a predicted rise in U.S. industrial production, and the continued growth of e-commerce are anticipated to drive sustained demand for our properties and the sector as a whole.
Structural trends – including the onshoring and nearshoring of manufacturing and warehousing operations, projected growth in U.S. industrial production, modernization of domestic supply chains, and continued expansion of e-commerce – are anticipated to drive sustained demand over the long-term. At the same time, several factors are contributing to a more constrained supply environment.
For the year ended December 31, 2024, we recorded an impairment provision related to six properties, consisting of one Office segment property and five Other segment properties, which were primarily related to anticipated dispositions.
For the year ended December 31, 2025, we recorded an impairment provision related to 24 properties, consisting of 23 Office segment properties (19 of which were Office Discontinued Operation Properties) and one Industrial segment property. These impairments resulted from changes during the year related to shortened anticipated hold periods and estimated selling prices.
Industrial Same Store NOI increased $1.5 million, or 3%, primarily due to lease extensions in 2024. Office Same Store NOI increased $1.0 million, or 1%, primarily due to a lease commencement in 2024, partially offset by lease terminations and expirations in 2023. Portfolio Analysis Comparison of the Years Ended December 31, 2024 and 2023.
Industrial Same Store NOI For this comparison period, Industrial Same Store NOI increased by $1.5 million primarily due to lease extensions in 2024, offset by timing of certain expense recoveries in 2024. Office Same Store NOI For this comparison period, Office Same Store NOI increased by $0.2 million primarily due to the timing of certain expense recoveries in 2024.
The payments on our mortgage debt do not include the premium/discount or debt financing costs. (2) Projected interest payments are based on the outstanding principal amounts at December 31, 2024. Projected interest payments on our KeyBank Loans are based on the contractual interest rates through maturity in effect at December 31, 2024.
(2) Projected interest payments are based on the outstanding principal amounts at December 31, 2025. Projected interest payments on our unsecured debt are based on the Contractual Interest Rates (refer to “ Outstanding Indebtedness ” section below) in effect at December 31, 2025.
(10) On October 31, 2024, under the Ninth Amendment to the Second Credit Agreement dated, the Company obtained an additional $175.0 million term loan. 53 Debt Covenants Pursuant to the terms of the Company's mortgage loans and the KeyBank Loans, the Operating Partnership, in consolidation with the Company, is subject to certain loan compliance covenants.
We have a one-year option to extend the maturity date to October 31, 2028, subject to certain conditions. Debt Covenants Pursuant to the terms of the Company's mortgage loans and the KeyBank Loans, the Operating Partnership, in consolidation with the Company, is subject to certain loan compliance covenants.
When adjusting for the effect of amortization of discounts/premiums and deferred financing costs, but excluding the impact of interest rate swaps, the Company’s weighted average effective interest rate was 6.24%. (3) Reflects the loan maturity dates as of December 31, 2024.
The Effective Interest Rate is calculated based on the face value of debt outstanding (i.e., excludes debt premium/discount and debt financing costs). When adjusting for the effect of amortization of discounts/premiums and deferred financing costs, and excluding the impact of interest rate swaps, the Company’s weighted average effective interest rate was 5.56%.
During the year ended December 31, 2024, we generated $94.7 million in cash from operating activities compared to $89.2 million for the year ended December 31, 2023. The increase in cash from operating activities was primarily due to significant decreases in transaction expenses incurred as a result of the Listing in 2023, partially offset by the impact of property dispositions.
During the year ended December 31, 2025, we generated $68.7 million in cash from operating activities compared to $94.7 million for the year ended December 31, 2024. The decrease in cash from operating activities was primarily due to our disposition activity in 2025 and 2024. Investing Activities.
Acquisitions of Real Estate We evaluated our real estate acquisition during the year ended December 31, 2024, and determined that this transaction should be accounted for as an asset acquisition.
Acquisitions of Real Estate During the year ended December 31, 2025, we acquired nine IOS properties which were accounted for as asset acquisitions.
Major supply factors include the slowing pace of construction, limited quantity of existing sites zoned for broad industrial uses, increasing resistance from municipalities for new industrial development and steady redevelopment of infill properties into other uses, all of which are expected to decrease supply.
These include a reduced pace of new construction, a limited supply of sites zoned for broad industrial use, power capacity constraints, municipal resistance to new industrial development, particularly in densely populated areas, and the redevelopment of infill properties into alternative uses.
We believe these two non-GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs. We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”).
The summary below describes the way we use these measures, provides information regarding why we believe these measures are meaningful supplemental measures of performance and reconciles these measures from net income or loss, the most directly comparable GAAP measures. 56 FFO We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”).
Highlights The following provides a summary of the significant developments related to our business during the year ended December 31, 2024: Transaction Activity: • On November 4, 2024, we acquired a portfolio of 51 industrial outdoor storage properties (“IOS Portfolio”) located throughout the United States for a gross contractual purchase price of $490.0 million.
Highlights The following provides a summary of the significant developments related to our business during the year ended December 31, 2025: Transaction Activity: Office Dispositions • During the year ended December 31, 2025, we sold 33 Office segment properties (27 of which are the Office Discontinued Operations Properties) for an aggregate gross sales price of approximately $883.7 million.
Cash used in investing activities for the year ended December 31, 2024 and 2023 consisted of the following (in thousands): Year Ended December 31, 2024 2023 Change Sources of cash provided by investing activities: Proceeds from disposition of properties $ 281,528 $ 325,160 $ (43,632) Total sources of cash provided by investing activities $ 281,528 $ 325,160 $ (43,632) Uses of cash for investing activities: Acquisition of properties, net (493,496) — (493,496) Payments for construction in progress (3,871) (16,323) 12,452 Sale (Purchase) of investments — (282) 282 Total uses of cash used in investing activities $ (497,367) $ (16,605) $ (480,762) Net cash (used in) provided by investing activities $ (215,839) $ 308,555 $ (524,394) 54 Financing Activities .
Cash used in investing activities for the years ended December 31, 2025 and 2024 consisted of the following (in thousands): Year Ended December 31, 2025 2024 Change Sources of cash provided by investing activities: Proceeds from disposition of properties $ 228,497 $ 281,528 $ (53,031) Proceeds from repayment of note receivable 15,000 — 15,000 Total sources of cash provided by investing activities $ 243,497 $ 281,528 $ (38,031) Uses of cash for investing activities: Acquisition of properties, net (95,379) (493,496) 398,117 Payments for construction in progress (6,908) (572) (6,336) Total uses of cash used in investing activities $ (102,287) $ (494,068) $ 391,781 Net cash provided by (used in) investing activities - discontinued operations 692,885 (3,299) 696,184 Net cash provided by (used in) investing activities $ 834,095 $ (215,839) $ 1,049,934 64 Financing Activities .
Business Environment Real estate investors are closely monitoring current market conditions, which are shaped by a mix of economic factors, geopolitical tensions,and changes in monetary policy. These factors have created an environment where caution has been the prevailing sentiment. Despite these challenges, investors continue to seek opportunities to generate returns through real estate investments.
Business Environment Real estate investors continue to closely monitor current market conditions, which are shaped by a mix of economic factors, geopolitical tensions, and evolving monetary and trade policies, including tariffs. Despite ongoing uncertainty, general market sentiment seems to be cautiously optimistic. In the industrial sector, fundamental demand drivers remain strong, even as broader economic conditions fluctuate.
Because FFO calculations exclude such items as depreciation and amortization of depreciable real estate assets and gains and losses from sales of depreciable real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), they facilitate comparisons of operating performance between periods and between other REITs.
FFO is used to facilitate meaningful comparisons of operating performance between periods and among other REITs, primarily because it excludes the effect of real estate depreciation and amortization and net gains (losses) from real estate sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time.
The Other segment consisted of vacant and non-core properties, together with other properties in the same cross-collateralized loan pool. 40 Reconciliation of Net Loss to Same Store NOI Total net loss for the years ended December 31, 2024 and December 31, 2023 was $11.4 million and $605.1 million, respectively.
Other Segment Disposal in 2024 Prior to December 31, 2024, the Company presented a third reportable segment, the “Other” segment, which consisted of vacant and non-core properties, together with other properties in the same cross-collateralized loan pools. On December 31, 2024, the Company sold the final property in its Other segment, and as a result, the Other segment was eliminated.
Our Same Store portfolio includes properties which were held in-service for a full period for all periods presented (thus, the IOS Portfolio is excluded for these periods).
Comparison of the Years Ended December 31, 2024 and 2023 Reconciliation of Net Loss to Same Store NOI Our Same Store portfolio includes properties that were held in-service for a full period for both comparative periods presented and excludes the Office Discontinued Operations Properties.
As of December 31, 2024, the Company’s portfolio was comprised of 103 properties, consisting of 97 operating properties and six redevelopment properties (those designated for redevelopment or repositioning) reported in two segments – Industrial and Office.
The portfolio included 60 IOS properties and 16 Traditional Industrial properties. Of the 76 properties in the Company’s portfolio, 72 were operating properties and four were designated for redevelopment or repositioning. 46 Office Segment Disposal in 2025 As of December 31, 2025, the Company completed the disposition of all Office segment properties, including the Office Discontinued Operations Properties.
Transaction Expenses Transaction expenses decreased approximately $24.2 million, or 97%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily because the Listing related expenses were incurred in 2023. Comparison of the Years Ended December 31, 2023 and 2022. Refer to “Item 7.
Depreciation and Amortization Depreciation and amortization increased by $4.7 million for the year ended December 31, 2025 as compared to the year ended December 31, 2024 primarily due to the acquisition of IOS properties in 2025 and 2024.
The CODM evaluates performance of each segment based on segment net operating income (“NOI”), which is defined as property revenue less property expenses. The Company excludes the following from segment NOI because they are addressed on a corporate level: (i) depreciation and amortization, (ii) real estate impairment, and (iii) general administrative expenses.
The CODM evaluates the performance of each segment based on segment net operating income (“NOI”), which is calculated as net income or loss excluding (to the extent applicable during the periods presented) general and administrative expenses, corporate operating expenses to related parties, impairment of real estate, depreciation and amortization, interest expense, other income, net, gains or losses on early extinguishment of debt, gains or losses on sales of real estate, impairment of goodwill, investment income or loss, transaction expense and net income or loss from discontinued operations and equity in earnings of unconsolidated real estate joint ventures.
We believe that AFFO is a recognized measure of sustainable operating performance by the REIT industry and is useful in comparing the sustainability of our operating performance with the sustainability of the operating performance of other real estate companies. Management believes that AFFO is a beneficial indicator of our ongoing portfolio performance and isolates the financial results of our operations.
We believe AFFO provides a useful supplemental measure of our operating performance and is useful in comparing our operating performance with other REITs that may not be involved in similar transactions or activities.
Removed
Company Overview Peakstone Realty Trust (NYSE: PKST) is an internally managed real estate investment trust currently shifting its portfolio composition towards industrial properties. PKST’s objective is to grow its portfolio through investments in the industrial outdoor storage (“IOS”) subsector. The Company’s existing portfolio includes high-quality, predominantly single-tenant industrial and office properties located in strategic markets.
Added
Overview Peakstone Realty Trust (NYSE: PKST) is an industrial real estate investment trust (“REIT”), with a strategic focus on growth in the industrial outdoor storage (“IOS”) sector. PKST OP, L.P., our operating partnership (the “Operating Partnership”), owns, directly and indirectly all of the Company’s assets.
Removed
The 51-property portfolio is comprised of 45 Operating Properties and six Redevelopment Properties.
Added
Of the 76 properties in our portfolio, 72 were operating properties and four were designated for redevelopment or repositioning. During 2025, the Company completed its strategic transformation to an industrial-only REIT through the disposition of all properties in its Office segment. As a result, the Office segment was eliminated as of December 31, 2025.
Removed
These properties span a total of 440 usable acres across 14 states. • During the year ended December 31, 2024, we sold two Office segment properties and 17 Other segment properties for approximately $317.4 million in gross disposition proceeds and recognized a net gain of approximately $38.4 million.
Added
As of September 30, 2025, the Company’s plan to dispose of its Office segment properties represented a strategic shift in its business that met the criteria for classification as discontinued operations. Accordingly, as of September 30, 2025, 27 Office segment properties were classified as discontinued operations (the “Office Discontinued Operations Properties”).
Removed
As a result of these dispositions, we have eliminated our Other segment. • On August 28, 2024, we sold our entire interest in the unconsolidated Office Joint Venture. Leasing Activity: • For the year ended December 31, 2024, the Company completed 837,400 square feet of new leases and lease extensions, with a weighted average lease term of 4.5 years.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

5 edited+0 added−1 removed5 unchanged
Biggest changeAs of December 31, 2024, our debt, excluding unamortized deferred financing cost and discounts/premiums, consisted of approximately $1.1 billion in fixed rate debt (including the effect of interest rate swaps) and $250.0 million of variable rate debt.
Biggest changeAs of December 31, 2025, the Company’s outstanding debt totaled approximately $485.9 million (excluding unamortized deferred financing cost and discounts/premiums), and was 100% fixed-rate, inclusive of the effects of our Interest Rate Swaps. As such, as of December 31, 2025, there would be no impact to future earnings and cash flows if SOFR were to change.
Our current indebtedness consists of the KeyBank loans and other loans and property secured mortgages as described in Note 5, Debt , to our consolidated financial statements included in this Annual Report on Form 10-K. These instruments were not entered into for trading purposes.
Our current indebtedness consists of the KeyBank loans and property secured mortgages as described in Note 5, Debt , to our consolidated financial statements included in this Annual Report on Form 10-K. These instruments were not entered into for trading purposes.
We may enter into interest rate hedging instruments (collectively, “Interest Rate Swaps”) to provide greater predictability in interest expense by protecting against potential increases in floating interest rates and allow for more precise budgeting, financial planning and forecasting. We will not enter into these instruments for trading or speculative purposes.
We have and may continue to enter into interest rate hedging instruments (collectively, “Interest Rate Swaps”) to provide greater predictability in interest expense by protecting against potential increases in floating interest rates and allow for more precise budgeting, financial planning and forecasting. We will not enter into these instruments for trading or speculative purposes.
The primary market risk to which we believe we may be exposed is interest rate risk, including the risk of changes in the underlying rates on our variable rate debt, which may result from factors that are beyond our control.
In this context, the primary market risk to which we believe we may be exposed is interest rate risk, including the risk of changes in the underlying rates on our variable rate debt, which may result from factors that are beyond our control.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK In this section, market risk is defined to generally include the exposure to loss resulting from changes in interest rates, foreign currency exchange rates and equity prices.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK In this section, market risk generally refers to risks that affect market sensitive instruments, such as changes in interest rates, foreign currency exchange rates, commodity prices, equity prices and other relevant market changes.
Removed
As of December 31, 2024, the effect of an increase of 100 basis points in interest rates, assuming a SOFR floor of 0%, on our variable-rate debt, including our KeyBank Loans, after considering the effect of our Interest Rate Swaps, would decrease our future earnings and cash flows by approximately $4.9 million annually.

Other PKST 10-K year-over-year comparisons