EX-99.2 3 tv500352_ex99-2.htm EXHIBIT 99.2

 

Exhibit 99.2

 

Global Net Lease, Inc.

 

Supplemental Information

 

 

Quarter ended June 30, 2018 (unaudited)

 

 

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Table of Contents    
     
Item   Page
Non-GAAP Definitions   3
Key Metrics   6
Consolidated Balance Sheets   7
Consolidated Statements of Operations   8
Non-GAAP Measures   9
Debt Overview   11
Future Minimum Lease Rents   12
Top Ten Tenants   13
Diversification by Property Type   14
Diversification by Tenant Industry   15
Diversification by Geography   16
Lease Expirations   17

 

Please note that totals may not add due to rounding.

 

Forward-looking Statements:

 

This supplemental package includes “forward looking statements”. Forward-looking statements may be identified by the use of words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “pro forma,” “estimates,” “contemplates,” “aims,” “continues,” “would” or “anticipates” or the negative of these words and phrases or similar words or phrases. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: the factors included in (i) the Annual Report on Form 10-K for the year ended December 31, 2017 of Global Net Lease, Inc. (the “Company”) filed on February 28, 2018, including those set forth under the headings “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Business,” and (ii) in future periodic reports filed by the Company under the Securities Exchange Act of 1934, as amended. While forward-looking statements reflect the Company’s good faith beliefs, they are not guarantees of future performance. The Company disclaims any obligation to publicly update or revise any forward- looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes after the date of this press release, except as required by applicable law. For a further discussion of these and other factors that could impact the Company’s future results, performance or transactions, see the section entitled “Risk Factors” in the Annual Report on Form 10-K for the year ended December 31, 2017 filed on February 28, 2018, and other risks described in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission. Prospective investors should not place undue reliance on any forward-looking statements, which are based only on information currently available to the Company (or to third parties making the forward-looking statements).

 

  2

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Non-GAAP Financial Measures

 

This section includes non-GAAP financial measures, including Funds from Operations ("FFO"), Core Funds from Operations ("Core FFO") and Adjusted Funds from Operations ("AFFO"), Adjusted Earnings before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA"), Net Operating Income (NOI"), and Cash Net Operating Income ("Cash NOI"). A description of these non-GAAP measures and reconciliations to the most directly comparable GAAP measure, which is net income, is provided below.

 

Caution on Use of Non-GAAP Measures

 

FFO, Core FFO, AFFO, Adjusted EBITDA, NOI, and Cash NOI should not be construed to be more relevant or accurate than the current GAAP methodology in calculating net income or in its applicability in evaluating our operating performance. The method utilized to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP measures.

 

Other REITs may not define FFO in accordance with the current National Association of Real Estate Investment Trusts ("NAREIT") definition (as we do), or may interpret the current NAREIT definition differently than we do, or may calculate Core FFO or AFFO differently than we do. Consequently, our presentation of FFO, Core FFO and AFFO may not be comparable to other similarly-titled measures presented by other REITs.

 

We consider FFO, Core FFO and AFFO useful indicators of our performance. Because FFO, Core FFO and AFFO calculations exclude such factors as depreciation and amortization of real estate assets and gains or losses from sales of operating real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), FFO, Core FFO and AFFO presentations facilitate comparisons of operating performance between periods and between other REITs in our peer group.

 

As a result, we believe that the use of FFO, Core FFO and AFFO, together with the required GAAP presentations, provide a more complete understanding of our performance including relative to our peers and a more informed and appropriate basis on which to make decisions involving operating, financing, and investing activities. However, FFO, Core FFO and AFFO are not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. Investors are cautioned that FFO, Core FFO and AFFO should only be used to assess the sustainability of our operating performance excluding these activities, as they exclude certain costs that have a negative effect on our operating performance during the periods in which these costs are incurred.

 

Funds from Operations, Core Funds from Operations and Adjusted Funds from Operations

 

Funds From Operations

 

Due to certain unique operating characteristics of real estate companies, as discussed below, NAREIT, an industry trade group, has promulgated a measure known as FFO, which we believe to be an appropriate supplemental measure to reflect the operating performance of a REIT. FFO is not equivalent to net income or loss as determined under GAAP.

 

We define FFO, a non-GAAP measure, consistent with the standards established by the White Paper on FFO approved by the Board of Governors of NAREIT, as revised in February 2004 (the "White Paper"). The White Paper defines FFO as net income or loss computed in accordance with GAAP, excluding gains or losses from sales of property but including asset impairment write-downs, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO. Our FFO calculation complies with NAREIT's definition.

 

The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, and straight-line amortization of intangibles, which implies that the value of a real estate asset diminishes predictably over time, especially if not adequately maintained or repaired and renovated as required by relevant circumstances or as requested or required by lessees for operational purposes in order to maintain the value disclosed. We believe that, because real estate values historically rise and fall with market conditions, including inflation, interest rates, unemployment and consumer spending, presentations of operating results for a REIT using historical accounting for depreciation and certain other items may be less informative. Historical accounting for real estate involves the use of GAAP. Any other method of accounting for real estate such as the fair value method cannot be construed to be any more accurate or relevant than the comparable methodologies of real estate valuation found in GAAP. Nevertheless, we believe that the use of FFO, which excludes the impact of real estate related depreciation and amortization, among other things, provides a more complete understanding of our performance to investors and to management, and when compared year over year, reflects the impact on our operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses, and interest costs, which may not be immediately apparent from net income.

 

  3

 

  

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Core Funds From Operations

 

In calculating Core FFO, we start with FFO, then we exclude certain non-core items such as acquisition- and transaction-related costs, as well as certain other costs that are considered to be non-core, such as fire loss and other costs related to damages at our properties. The purchase of properties, and the corresponding expenses associated with that process, is a key operational feature of our core business plan to generate operational income and cash flows in order to make dividend payments to stockholders. In evaluating investments in real estate, we differentiate the costs to acquire the investment from the operations derived from the investment. By excluding expensed acquisition- and transaction-related costs as well as non-core costs, we believe Core FFO provides useful supplemental information that is comparable for each type of real estate investment and is consistent with management's analysis of the investing and operating performance of our properties.

 

Adjusted Funds From Operations

 

In calculating AFFO, we start with Core FFO, then we exclude certain income or expense items from AFFO that we consider more reflective of investing activities, other non-cash income and expense items and the income and expense effects of other activities that are not a fundamental attribute of our business plan. These items include early extinguishment of debt and unrealized gains and losses, which may not ultimately be realized, such as gains or losses on derivative instruments, gains and losses on foreign currency transactions, and gains and losses on investments. In addition, by excluding non-cash income and expense items such as amortization of above-market and below-market leases intangibles, amortization of deferred financing costs, straight-line rent and equity-based compensation from AFFO, we believe we provide useful information regarding income and expense items which have a direct impact on our ongoing operating performance. We also include the realized gains or losses on foreign currency exchange contracts for AFFO as such items are part of our ongoing operations and affect the current operating performance of the Company. By providing AFFO, we believe we are presenting useful information that can be used to better assess the sustainability of our ongoing operating performance without the impacts of transactions that are not related to the ongoing profitability of our portfolio of properties. AFFO presented by us may not be comparable to AFFO reported by other REITs that define AFFO differently.

 

In calculating AFFO, we exclude certain expenses which under GAAP are characterized as operating expenses in determining operating net income. All paid and accrued merger, acquisition and transaction related fees and certain other expenses negatively impact our operating performance during the period in which expenses are incurred or properties are acquired will also have negative effects on returns to investors, but are not reflective of our on-going performance. Further, under GAAP, certain contemplated non-cash fair value and other non-cash adjustments are considered operating non-cash adjustments to net income. In addition, as discussed above, we view gains and losses from fair value adjustments as items which are unrealized and may not ultimately be realized and not reflective of ongoing operations and are therefore typically adjusted for when assessing operating performance. Excluding income and expense items detailed above from our calculation of AFFO provides information consistent with management's analysis of the operating performance of the Company. Additionally, fair value adjustments, which are based on the impact of current market fluctuations and underlying assessments of general market conditions, but can also result from operational factors such as rental and occupancy rates, may not be directly related or attributable to our current operating performance. By excluding such changes that may reflect anticipated and unrealized gains or losses, we believe AFFO provides useful supplemental information. We believe that in order to facilitate a clear understanding of our operating results, AFFO should be examined in conjunction with net income (loss) as presented in our consolidated financial statements. AFFO should not be considered as an alternative to net income (loss) as an indication of our performance or to cash flows as a measure of our liquidity or ability to make distributions.

 

Adjusted Earnings before Interest, Taxes, Depreciation and Amortization, Net Operating Income, and Cash Net Operating Income

 

We believe that Adjusted EBITDA, which is defined as earnings before interest, taxes, depreciation and amortization adjusted for acquisition and transaction-related expenses, other non-cash items and including our pro-rata share from unconsolidated joint ventures, is an appropriate measure of our ability to incur and service debt. Adjusted EBITDA should not be considered as an alternative to cash flows from operating activities, as a measure of our liquidity or as an alternative to net income as an indicator of our operating activities. Other REITs may calculate Adjusted EBITDA differently and our calculation should not be compared to that of other REITs.

 

  4

 

  

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

NOI is a non-GAAP financial measure equal to net income (loss), the most directly comparable GAAP financial measure, less discontinued operations, interest, other income and income from preferred equity investments and investment securities, plus corporate general and administrative expense, acquisition and transaction-related expenses, depreciation and amortization, other non-cash expenses and interest expense. NOI is adjusted to include our pro rata share of NOI from unconsolidated joint ventures. We use NOI internally as a performance measure and believe NOI provides useful information to investors regarding our financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level. Therefore, we believe NOI is a useful measure for evaluating the operating performance of our real estate assets and to make decisions about resource allocations. Further, we believe NOI is useful to investors as a performance measure because, when compared across periods, NOI reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition activity on an unlevered basis, providing perspective not immediately apparent from net income. NOI excludes certain components from net income in order to provide results that are more closely related to a property's results of operations. For example, interest expense is not necessarily linked to the operating performance of a real estate asset and is often incurred at the corporate level as opposed to the property level. In addition, depreciation and amortization, because of historical cost accounting and useful life estimates, may distort operating performance at the property level. NOI presented by us may not be comparable to NOI reported by other REITs that define NOI differently. We believe that in order to facilitate a clear understanding of our operating results, NOI should be examined in conjunction with net income (loss) as presented in our consolidated financial statements. NOI should not be considered as an alternative to net income (loss) as an indication of our performance or to cash flows as a measure of our liquidity.

 

Cash NOI, is a non-GAAP financial measure that is intended to reflect the performance of our properties. We define Cash NOI as net operating income (which is separately defined herein) excluding amortization of above/below market lease intangibles and straight-line adjustments that are included in GAAP lease revenues. We believe that Cash NOI is a helpful measure that both investors and management can use to evaluate the current financial performance of our properties and it allows for comparison of our operating performance between periods and to other REITs. Cash NOI should not be considered as an alternative to net income, as an indication of our financial performance, or to cash flows as a measure of liquidity or our ability to fund all needs. The method by which we calculate and present Cash NOI may not be directly comparable to the way other REITs present Cash NOI.

 

  5

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Key Metrics

As of and for the three months ended June 30, 2018

Amounts in thousands, except per share data, ratios and percentages

 

Financial Results     
Rental Income  $65,562 
Net income attributable to common stockholders  $5,288 
Basic and diluted net income per share attributable to common stockholders [1]  $0.08 
Cash NOI [2]  $61,427 
Adjusted EBITDA [2]  $53,066 
AFFO attributable to common stockholders [2]  $35,514 
Dividends paid per share - second quarter  $0.53 
Dividend yield - annualized, based on quarter end share price   10.4%
Dividend payout ratio - second quarter   100.5%
      
Balance Sheet and Capitalization     
Equity market capitalization - based on quarter end share price of $20.43 for common shares and $25.63 for preferred shares  $1,513,826 
Net debt [3] [4]   1,575,685 
Enterprise value   3,089,511 
      
Total capitalization   3,182,837 
      
Total consolidated debt [4]   1,669,011 
Total assets   3,111,085 
Liquidity [5]   107,496 
      
Common shares outstanding as of June 30, 2018 (thousands)   67,307 
Share price, end of quarter  $20.43 
      
Net debt to enterprise value   51.0%
Net debt to adjusted EBITDA (annualized)   7.4x
      
Weighted-average interest rate cost [6]   3.1%
Weighted-average debt maturity (years) [7]   3.3 
Interest Coverage Ratio [8]   4.2x
      
Real Estate Portfolio     
Number of properties   333 
Number of tenants   104 
      
Square footage (millions)   25.0 
Leased   99.5%
Weighted-average remaining lease term (years) [9]   8.5 

 

Footnotes:

[1]  Adjusted for net income (loss) attributable to common stockholders for common share equivalents.

[2]  This Non-GAAP metric is reconciled below.

[3]  Includes the effect of cash and cash equivalents.

[4]  Excludes the effect of deferred financing costs, net and mortgage (discount) premium, net.

[5]  Liquidity includes $14.2 million of availability under the credit facility and cash and cash equivalents.

[6]  The weighted average interest rate cost is based on the outstanding principal balance of the debt.

[7]  The weighted average debt maturity is based on the outstanding principal balance of the debt.

[8] The interest coverage ratio is calculated by dividing adjusted EBITDA by cash paid for interest (interest expense less non-cash portion of interest expense and amortization of mortgage (discount) premium, net) for the quarter ended June 30, 2018. Adjusted EBITDA and cash paid for interest are Non-GAAP metrics and are reconciled below.

[9] The weighted-average remaining lease term (years) is based on square feet.

 

  6

 

  

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018

 

Consolidated Balance Sheets

Amounts in thousands

 

   June 30,
 2018
   December 31,
 2017
 
   (Unaudited)     
ASSETS          
Real estate investments, at cost:          
Land  $408,178   $402,318 
Buildings, fixtures and improvements   2,219,486    2,138,405 
Construction in progress   2,970    2,328 
Acquired intangible lease assets   642,472    629,626 
Total real estate investments, at cost   3,273,106    3,172,677 
Less accumulated depreciation and amortization   (391,269)   (339,931)
Total real estate investments, net   2,881,837    2,832,746 
Cash and cash equivalents   93,326    102,425 
Restricted cash   2,873    5,302 
Derivative assets, at fair value   7,568    2,176 
Unbilled straight-line rent   45,027    42,739 
Prepaid expenses and other assets   51,156    22,617 
Due from related parties   16    16 
Deferred tax assets   1,006    1,029 
Goodwill and other intangible assets, net   22,443    22,771 
Deferred financing costs, net   5,833    6,774 
Total Assets  $3,111,085   $3,038,595 
           
LIABILITIES AND EQUITY          
Mortgage notes payable, net  $975,929   $984,876 
Revolving credit facilities   458,880    298,909 
Term loan, net   224,510    229,905 
Acquired intangible lease liabilities, net   32,787    31,388 
Derivative liabilities, at fair value   5,976    15,791 
Due to related parties   779    829 
Accounts payable and accrued expenses   27,152    23,227 
Prepaid rent   16,690    18,535 
Deferred tax liability   15,511    15,861 
Taxes payable   1,933    2,475 
Dividends payable   2,341    2,556 
Total Liabilities   1,762,488    1,624,352 
Commitments and contingencies        
Stockholders' Equity:          
7.25% Series A cumulative redeemable preferred shares   54    54 
Common stock   2,003    2,003 
Additional paid-in capital   1,859,990    1,860,058 
Accumulated other comprehensive income   19,116    19,447 
Accumulated deficit   (532,566)   (468,396)
Total Stockholders' Equity   1,348,597    1,413,166 
Non-controlling interest       1,077 
Total Equity   1,348,597    1,414,243 
Total Liabilities and Equity  $3,111,085   $3,038,595 

 

  7

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Consolidated Statements of Operations

Amounts in thousands, except per share data

 

   Three Months Ended 
   June 30,
2018
   March 31,
2018
   December 31,
2017
   September 30,
2017
 
Revenues:                    
Rental income  $65,562   $63,792   $62,556   $61,270 
Operating expense reimbursements   5,409    4,294    4,046    3,600 
Total revenues   70,971    68,086    66,602    64,870 
                     
 Expenses:                    
Property operating   8,211    7,470    6,849    7,202 
Fire recovery   (1)   (79)   (150)   (305)
Operating fees to related parties   7,138    6,831    6,624    6,390 
Acquisition and transaction related   2,399    1,325    (301)   1,141 
General and administrative   2,556    2,051    2,357    2,468 
Equity-based compensation   (23)   (832)   (1,177)   (391)
Depreciation and amortization   29,813    29,496    28,558    29,879 
Total expenses   50,093    46,262    42,760    46,384 
Operating income   20,878    21,824    23,842    18,486 
Other income (expense):                    
Interest expense   (14,415)   (12,975)   (12,806)   (12,479)
(Loss) gain on dispositions of real estate investments   (3,818)           275 
Gain (loss) on derivative instruments   6,333    (2,935)   (1,719)   (3,125)
Unrealized (loss) gain on undesignated foreign currency advances and other hedge ineffectiveness   (47)   (43)   86    88 
Other income   12    11    10    2 
Total other expense, net   (11,935)   (15,942)   (14,429)   (15,239)
Net income before income taxes   8,943    5,882    9,413    3,247 
Income tax expense   (1,200)   (1,070)   (964)   (760)
Net income   7,743    4,812    8,449    2,487 
Net income attributable to non-controlling interest                
Preferred stock dividends   (2,455)   (2,451)   (2,451)   (383)
Net income attributable to common stockholders  $5,288   $2,361   $5,998   $2,104 
                     
Basic and Diluted Earnings Per Share:                    
Basic and diluted net income per share attributable to common stockholders  $0.08   $0.03   $0.09   $0.03 
Weighted average shares outstanding:                    
Basic and Diluted   67,292    67,287    67,287    67,287 

 

  8

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Non-GAAP Measures

Amounts in thousands, except per share data

 

   Three Months Ended 
   June 30,
2018
   March 31,
2018
   December 31,
2017
   September
30, 2017
 
EBITDA:                    
Net income  $7,743   $4,812   $8,449   $2,487 
Depreciation and amortization   29,813    29,496    28,558    29,879 
Interest expense   14,415    12,975    12,806    12,479 
Income tax expense   1,200    1,070    964    760 
   EBITDA   53,171    48,353    50,777    45,605 
                     
Adjusted EBITDA:                    
Equity-based compensation   (23)   (832)   (1,177)   (391)
Acquisition and transaction related   2,399    1,325    (301)   1,141 
Loss (gain) on dispositions of real estate investments   3,818            (275)
Fire recovery   (1)   (79)   (150)   (305)
(Gain) loss on derivative instruments   (6,333)   2,935    1,719    3,125 
Unrealized loss (gain) on undesignated foreign currency advances and other hedge ineffectiveness   47    43    (86)   (88)
Other income   (12)   (11)   (10)   (2)
   Adjusted EBITDA   53,066    51,734    50,772    48,810 
                     
Net Operating Income (NOI):                    
Operating fees to related parties   7,138    6,831    6,624    6,390 
General and administrative   2,556    2,051    2,357    2,468 
   NOI   62,760    60,616    59,753    57,668 
                     
Cash Net Operating Income (Cash NOI):                    
Amortization of above- and below- market leases and ground lease assets and liabilities, net   500    552    533    489 
Straight-line rent   (1,833)   (1,503)   (1,550)   (2,070)
Cash NOI  $61,427   $59,665   $58,736   $56,087 
                     
Cash Paid for Interest:                    
Interest Expense  $14,415   $12,975   $12,806   $12,479 
Non-cash portion of interest expense   (1,499)   (901)   (1,399)   (1,198)
Amortization of mortgage (discount) premium, net   (263)   (267)   (262)   (261)
Total cash paid for interest  $12,653   $11,807   $11,145   $11,020 

  

  9

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Non-GAAP Measures

Amounts in thousands, except per share data

   Three Months Ended 
   June 30,
 2018
   March 31,
2018
   December 31,
2017
   September
30, 2017
 
Funds from operations (FFO):                    
Net income attributable to common stockholders (in accordance with GAAP)  $5,288   $2,361   $5,998   $2,104 
Depreciation and amortization   29,813    29,496    28,558    29,879 
Loss (gain) on dispositions of real estate investments   3,818            (275)
Proportionate share of adjustments for non-controlling interest to arrive at FFO           (3)    
FFO (as defined by NAREIT) attributable to common stockholders   38,919    31,857    34,553    31,708 
                     
Acquisition and transaction fees [1]   2,399    1,325    (301)   1,141 
Fire recovery [2]   (1)   (79)   (150)   (305)
Proportionate share of adjustments for non-controlling interest to arrive at Core FFO           1     
Core FFO attributable to common stockholders   41,317    33,103    34,103    32,544 
Non-cash equity-based compensation   (23)   (832)   (1,177)   (391)
Non-cash portion of interest expense   1,499    901    1,399    1,198 
Amortization of above and below-market leases and ground lease assets and liabilities, net   500    552    533    489 
Straight-line rent   (1,833)   (1,503)   (1,550)   (2,070)
Unrealized losses (gains) on undesignated foreign currency advances and other hedge ineffectiveness   47    43    (86)   (88)
Eliminate unrealized losses on foreign currency transactions [3]   (6,256)   2,550    1,681    3,598 
Amortization of mortgage discounts and premiums, net   263    267    262    261 
Deferred tax benefit               (693)
Adjusted funds from operations (AFFO) attributable to common stockholders  $35,514   $35,081   $35,165   $34,848 
                     
Weighted average common shares outstanding   67,292    67,287    67,287    67,287 
FFO per common share  $0.58   $0.47   $0.51   $0.47 
Core FFO per common share  $0.61   $0.49   $0.51   $0.48 
Dividends declared [4]  $35,828   $35,833   $35,955   $35,857 

 

Footnotes:

[1]Includes debt prepayment costs, litigation, merger related, and other costs, as applicable.
[2](Recovery)/loss arising from clean-up costs related to a fire sustained at one of our office properties.
[3]For AFFO purposes, we add back unrealized (gain) loss. For the three months ended June 30, 2018, gains on derivative instruments were $6.3 million which were primarily comprised of unrealized gains. For the three months ended March 31, 2018, losses on derivative instruments were $2.9 million, which were comprised of unrealized losses of $2.6 million and realized losses of $0.3 million. For the three months ended December 31, 2017, losses on derivative instruments were $1.7 million, which were comprised of unrealized losses of $1.7 million and realized losses of $38 thousand. For the three months ended September 30, 2017, losses on derivative instruments were $3.1 million, which were comprised of unrealized losses of $3.6 million offset by net realized gains of $0.5 million.
[4]Dividends declared to common stockholders only, and do not include distributions to non-controlling interest holders or holders of Series A Preferred Stock.

 

  10

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Debt Overview

As of June 30, 2018

Amounts in thousands, except ratios and percentages

 

Year of Maturity  Number of
Encumbered
Properties
   Weighted-
Average Debt
Maturity
(Years)
   Weighted-
Average

Interest Rate [1]
   Total
Outstanding
Balance [2]
   Percent 
Non-Recourse Debt                         
2018 (remainder)   9    0.2    3.5%  $124,251      
2019   14    1.2    2.4%   286,124      
2020   40    2.1    2.6%   325,384      
2021   6    1.9    2.0%   27,216      
2022           %         
2023           %         
Thereafter   20    9.4    4.4%   219,750      
Total Non-Recourse Debt   89    3.2    3.0%   982,725    59%
                          
Recourse Debt                         
   Revolving Credit Facility        3.1    3.7%   458,880      
   Term Loan Facility        4.1    1.9%   227,406      
Total Recourse Debt        3.4    3.1%   686,286    41%
                          
Total Debt        3.3    3.1%  $1,669,011    100%
                          
Total Debt by Currency              Percent     
USD                  39%     
EUR                  41%     
GBP                  20%     
Total                  100%     

 

Footnotes:

 

[1] As of June 30, 2018, the Company’s total combined debt was 76.3% fixed rate or swapped to a fixed rate and 23.7% floating rate.

 

[2] Excludes the effect of deferred financing costs, net and mortgage (discount) premium, net. Current balances as of June 30, 2018 are shown in the year the loan matures.

 

  11

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Future Minimum Lease Rents

As of June 30, 2018

Amounts in thousands

 

   Future Minimum
Base Rent Payments [1]
 
2018 (remainder)  $127,817 
2019   258,324 
2020   261,743 
2021   262,429 
2022   253,036 
2023   228,931 
Thereafter   716,143 
Total  $2,108,423 

 

Footnotes:

 

[1] Base rent assumes exchange rates of £1.00 to $1.32 for GBP and €1.00 to $1.17 for EUR as of June 30, 2018 for illustrative purposes, as applicable.

 

  12

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Top Ten Tenants

As of June 30, 2018

Amounts in thousands, except percentages

 

Tenant / Lease Guarantor  Property Type  Tenant Industry  Annualized SL Rent [1]   SL Rent Percent 
FedEx  Distribution  Freight  $12,750    5%
Government Services Administration (GSA)  Office  Government   12,016    5%
Foster Wheeler  Office  Engineering   11,220    4%
RWE AG  Office  Utilities   11,136    4%
ING Bank  Office  Financial Services   9,295    4%
Finnair  Industrial  Aerospace   9,219    4%
Family Dollar  Retail  Discount Retail   8,125    3%
Steel Service Supplier  Industrial  Metal Processing   6,815    3%
Harper Collins  Distribution  Publishing   6,778    3%
Trinity Health  Office  Healthcare   6,584    3%
Subtotal         93,938    36%
                 
Remaining portfolio         167,475    64%
                 
Total Portfolio        $261,413    100%

 

Footnotes:

 

[1] SL Rent (Straight-line rent) is on an annualized basis and assumes exchange rates of £1.00 to $1.32 for GBP and €1.00 to $1.17 for EUR as of June 30, 2018 for illustrative purposes, as applicable.

 

  13

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Diversification by Property Type

As of June 30, 2018

Amounts in thousands, except percentages

 

   Total Portfolio   Unencumbered Portfolio [2] 
Property Type  Annualized
SL Rent [1]
   SL Rent
Percent
   Square Feet   Sq. ft.
Percent
   Annualized
SL Rent [1]
   SL Rent
Percent
   Square Feet   Sq. ft.
Percent
 
Office  $145,187    56%   8,422    34%  $43,202    41%   2,489    22%
Industrial   58,317    22%   9,088    36%   32,859    32%   5,306    48%
Distribution   33,808    13%   5,366    21%   14,251    14%   2,179    20%
Retail   24,101    9%   2,109    9%   13,808    13%   1,089    10%
Total  $261,413    100%   24,985    100%  $104,120    100%   11,063    100%

 

Footnotes:

 

[1] SL Rent (Straight-line rent) is on an annualized basis and assumes exchange rates of £1.00 to $1.32 for GBP and €1.00 to $1.17 for EUR as of June 30, 2018 for illustrative purposes, as applicable.

 

[2] Includes properties on the credit facility borrowing base.

 

  14

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Diversification by Tenant Industry

As of June 30, 2018

Amounts in thousands, except percentages

 

   Total Portfolio   Unencumbered Portfolio [3] 
Industry Type  Annualized SL
Rent [1]
   SL Rent
Percent
   Square Feet   Sq. ft.
Percent
   Annualized SL
Rent [1]
   SL Rent
Percent
   Square
Feet
   Sq. ft.
Percent
 
Financial Services  $34,639    13%   2,316    9%  $4,692    5%   446    4%
Discount Retail   15,993    6%   1,786    7%   9,976    10%   985    9%
Aerospace   14,996    6%   1,258    5%   2,992    3%   233    2%
Telecommunications   14,658    6%   913    4%   3,368    3%   198    2%
Government   14,451    6%   536    2%   11,668    11%   424    4%
Technology   14,199    5%   761    3%   4,170    4%   165    1%
Freight   13,688    5%   1,413    6%   10,000    10%   1,082    10%
Healthcare   13,680    5%   647    3%   7,372    7%   423    4%
Metal Processing   13,162    5%   2,472    10%   11,034    11%   2,152    19%
Utilities   12,824    5%   673    3%       %       %
Energy   11,848    5%   1,043    4%   9,255    9%   821    7%
Engineering   11,220    4%   366    1%       %       %
Pharmaceuticals   9,789    4%   390    2%   1,970    2%   90    1%
Auto Manufacturing   7,982    3%   2,068    8%   5,225    5%   1,067    10%
Retail Food Distribution   7,506    3%   1,128    5%   825    1%   170    2%
Publishing   6,778    3%   873    3%       %       %
Metal Fabrication   5,368    2%   720    3%   2,120    2%   297    3%
Automotive Parts Supplier   3,527    1%   411    2%   1,311    1%   91    1%
Restaurant - Quick Service   3,397    1%   74    %   3,397    3%   74    1%
Logistics   3,269    1%   1,273    5%       %       %
Specialty Retail   3,025    1%   280    1%       %       %
Other [2]   25,414    10%   3,584    14%   14,745    13%   2,345    20%
Total  $261,413    100%   24,985    100%  $104,120    100%   11,063    100%

 

Footnotes:

 

[1] SL Rent (Straight-line rent) is on an annualized basis and assumes exchange rates of £1.00 to $1.32 for GBP and €1.00 to $1.17 for EUR as of June 30, 2018 for illustrative purposes, as applicable.

 

[2] Other includes 20 industry types as of June 30, 2018.

 

[3] Includes properties on the credit facility borrowing base.

 

  15

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Diversification by Geography

As of June 30, 2018

Amounts in thousands, except percentages

   Total Portfolio   Unencumbered Portfolio [2] 
Region  Annualized SL
Rent [1]
   SL Rent
Percent
   Square
Feet
   Sq. ft.
Percent
   Annualized
SL Rent [1]
   SL Rent
Percent
   Square
Feet
   Sq. ft.
Percent
 
United States  $131,196    50.1%   14,378    57.8%  $91,350    87.7%   10,365    93.7%
Michigan   26,565    10.2%   3,537    14.2%   19,917    19.1%   2,721    24.6%
Texas   20,588    7.9%   1,870    7.5%   13,507    13.0%   1,246    11.3%
California   10,478    4.0%   389    1.6%   4,170    4.0%   165    1.5%
New Jersey   9,012    3.4%   397    1.6%   686    0.7%   48    0.4%
Tennessee   7,102    2.7%   789    3.2%   5,368    5.2%   327    3.0%
Indiana   5,684    2.2%   1,414    5.7%   4,660    4.5%   874    7.9%
Ohio   5,419    2.1%   838    3.4%   4,472    4.3%   671    6.1%
Illinois   4,095    1.6%   789    3.2%   4,095    3.9%   789    7.1%
Missouri   3,427    1.3%   309    1.2%   3,427    3.3%   309    2.8%
South Carolina   3,296    1.3%   414    1.7%   3,296    3.2%   414    3.7%
Florida   3,014    1.2%   206    0.8%   3,014    2.9%   206    1.9%
Kentucky   2,740    1.0%   355    1.4%   2,740    2.6%   355    3.2%
New York   2,398    0.9%   221    0.9%   450    0.4%   63    0.6%
Minnesota   2,138    0.8%   150    0.6%   781    0.8%   117    1.1%
Mississippi   2,105    0.8%   381    1.5%   2,105    2.0%   381    3.4%
Pennsylvania   1,953    0.7%   234    0.9%   1,390    1.3%   121    1.1%
Maine   1,878    0.7%   50    0.2%   1,878    1.8%   50    0.5%
Massachusetts   1,757    0.7%   127    0.5%   1,757    1.7%   127    1.1%
North Carolina   1,546    0.6%   192    0.8%   786    0.8%   123    1.1%
South Dakota   1,304    0.5%   54    0.2%   1,304    1.3%   54    0.5%
Kansas   1,275    0.5%   179    0.7%   1,275    1.2%   179    1.6%
Louisiana   1,264    0.5%   137    0.5%   1,264    1.2%   137    1.2%
Nebraska   1,222    0.5%   116    0.5%   564    0.5%   58    0.5%
Vermont   1,166    0.4%   213    0.9%       %       %
Colorado   1,088    0.4%   27    0.1%   1,088    1.0%   27    0.2%
West Virginia   980    0.4%   104    0.4%       %       %
Iowa   886    0.3%   232    0.9%   886    0.9%   232    2.1%
North Dakota   884    0.3%   47    0.2%   884    0.8%   47    0.4%
Oklahoma   825    0.3%   89    0.4%   825    0.8%   89    0.8%
Alabama   802    0.3%   74    0.3%   802    0.8%   74    0.7%
Maryland   785    0.3%   120    0.5%   785    0.8%   120    1.1%
New Mexico   556    0.2%   46    0.2%   556    0.5%   46    0.4%
Georgia   452    0.2%   41    0.2%   452    0.4%   41    0.4%
Montana   441    0.2%   54    0.2%   441    0.4%   54    0.5%
Utah   397    0.2%   20    0.1%   397    0.4%   20    0.2%
Delaware   361    0.1%   10    %   361    0.3%   10    0.1%
New Hampshire   346    0.1%   83    0.3%       %       %
Idaho   644    0.2%   38    0.2%   644    0.6%   38    0.3%
Arizona   156    0.1%   16    0.1%   156    0.1%   16    0.1%
Arkansas   91    %   8    %   91    0.1%   8    0.1%
Virginia   76    %   8    %   76    0.1%   8    0.1%
United Kingdom   54,894    21.0%   4,080    16.3%   1,637    1.6%   104    0.9%
Germany   21,081    8.1%   2,178    8.7%       %       %
The Netherlands   17,218    6.6%   1,039    4.2%   7,922    7.6%   529    4.8%
Finland   15,237    5.8%   1,457    5.8%       %       %
France   13,015    5.0%   1,632    6.5%       %       %
Luxembourg   5,561    2.1%   156    0.6%       %       %
US Province   3,211    1.3%   65    0.1%   3,211    3.1%   65    0.6%
Total  $261,413    100%   24,985    100%  $104,120    100%   11,063    100%

Footnotes:

[1] SL Rent (Straight-line rent) is on an annualized basis and assumes exchange rates of £1.00 to $1.32 for GBP and €1.00 to $1.17 for EUR as of June 30, 2018 for illustrative purposes, as applicable.

 

[2] Includes properties on the credit facility borrowing base.

 

  16

 

 

Global Net Lease, Inc.
Supplemental Information
Quarter ended June 30, 2018 (Unaudited)

 

Lease Expirations

As of June 30, 2018

Amounts in thousands, except ratios and percentages

 

Year of Expiration  Number of
Leases Expiring
   Annualized SL
Rent [1]
   Annualized SL
Rent Percent
   Leased
Rentable
Square Feet
   Percent of
Rentable
Square Feet
Expiring
 
       (In thousands)             
2018 (Remaining)      $    %       %
2019           %       %
2020   2    1,055    0.4%   100    0.4%
2021   2    4,944    1.9%   323    1.3%
2022   16    23,858    9.1%   1,553    6.2%
2023   30    28,128    10.8%   2,411    9.7%
2024   45    68,943    26.4%   5,887    23.7%
2025   39    38,327    14.7%   3,269    13.2%
2026   16    21,096    8.1%   2,038    8.2%
2027   15    6,694    2.6%   717    2.9%
2028   38    17,893    6.8%   3,019    12.1%
2029   106    21,830    8.4%   2,105    8.5%
2030   10    7,926    3.0%   458    1.8%
2031           %       %
2032   5    1,953    0.7%   317    1.3%
2033   1    6,018    2.3%   801    3.2%
Thereafter (>2033)   8    12,748    5.0%   1,861    7.4%
Total   333   $261,413    100%   24,859    100%

 

[1] Annualized rental income converted from local currency into USD as of June 30, 2018 for the in-place lease in the property on a straight-line basis, which includes tenant concessions such as free rent, as applicable.

 

 

  17