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- **Industrial Expansion**: 69% of rents from industrial (vs 63% start 2025), with $206M year-to-date acquisitions.
- **Portfolio Strength**: 99.1% occupancy, 7.5-year WALT, 3.1% same-store lease growth.
- **Financial Resilience**: $0.35 FFO despite 8% YoY decline, $600M credit facility extended.
- **CapEx Focus**: $10M+ Q3 on renewals, targeting 8.5%+ cap rates for 2026 deals.
- **Dividend Stability**: Maintained at $0.30 with accretive investments and equity issuance.
- **Risk Management**: 24% floating debt, 37% hedged, no 2025 maturities.


**【CEO Summary Section】**
- Acquired a 6-facility industrial portfolio for $54.5 million, bringing year-to-date acquisitions to $206 million.
- Industrial concentration rose to 69% of straight-line rents (from 63% at year-start).
- Portfolio occupancy at 99.1%, WALT 7.5 years, and same-store lease revenue up 3.1% YoY.
- Extended credit facility to $600 million, reducing 2025 maturities to $28 million.
- Dividend maintained at $0.30 per quarter.

**【Portfolio Performance】**
- Sold 1 non-core industrial property, leased 734,000 sq ft with 0.7-11.4 year terms, and achieved $1.1 million in straight-line rent growth.
- 100% rent collection and no material tenant issues.
- Balance sheet improvements include $600 million credit facility (39% fixed, 37% hedged floating) and $61 million ATM equity raise.
- Focus on industrial expansion and strategic capital recycling.

**【CFO Financial Commentary】**
- Q3 FFO/core FFO: $0.35 (down 8% YoY vs $0.38).
- Operating revenues $40.8 million (+4% YoY), expenses $26 million (-9% YoY) due to lower impairment and higher recoveries.
- Debt: 24% floating (SOFR 4.24%), 37% hedged floating, 39% fixed.
- Liquidity: $6 million cash, $63 million revolver availability.

**【Q&A Highlights】**
- **Industrial Growth**: Targeting >70% industrial concentration, with 2 potential Q4 acquisitions.
- **Expense Trends**: 20%+ YoY operating expense growth driven by inflation, insurance, and tenant pass-throughs.
- **CapEx**: $10+ million Q3 for renewals, supporting 3.1% same-store growth; expect lower 2026 CapEx.
- **Dividend Sustainability**: Accretive investments and 8.5%+ cap rate acquisitions support dividend.
- **Leverage Management**: Issuing equity to deleverage, with no 2025 debt maturities.
- **Market Outlook**: Cap rates compressing, targeting 8.5%+ on accretive industrial deals.
- **Government Shutdown**: No tenant impact reported.


Gladstone Commercial Corporation (GOOD) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

GOOD

GOOD fundamentals

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