EX-99.2 3 exhibit992-q42021earning.htm EX-99.2 exhibit992-q42021earning
EXHIBIT 99.2


 
This presentation contains certain financial information not derived in accordance with the United States generally accepted accounting principles (GAAP). These items include, but are not limited to, earnings before interest, income taxes, depreciation and amortization (EBITDA), EBITDA for real estate (EBITDAre); funds from operations (FFO); adjusted funds from operations (AFFO); interest expense, adjusted; liquidity; net debt; net operating income (NOI); and cash NOI. These measures (and the methodologies used to derive them) may not be comparable to those used by other companies. Refer to the glossary for a detailed explanation of these terms and reconciliations to the most directly comparable GAAP measure, as well as others appearing in the supplement. Management considers each item an important supplemental measure of operating and financial performance and believes they are frequently used by interested parties in the evaluation of real estate investment trusts. These measures should not be considered as alternatives, or superior measures, to net income or loss as an indicator of the company's performance and should be considered only as a supplement to net income or loss and cash flows from operating, investing or financing activities as measures of profitability and/or liquidity, computed in accordance with GAAP. All quarterly information presented in this supplement is unaudited and should be read in conjunction with the company’s audited consolidated financial statements (and the notes thereto) included in the Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on March 29, 2022. Certain statements contained herein, other than historical fact, may be considered “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provided by the same. These statements are based on management’s current expectations and beliefs and are subject to a number of trends and uncertainties. No forward-looking statement is intended to, nor shall it, serve as a guarantee of future performance. You can identify the forward-looking statements by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “outlook,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “will” and other similar terms and phrases, including references to assumptions and forecasts of future results and to the anticipated development properties. Forward-looking statements are subject to various risks and uncertainties and factors that could cause actual results to differ materially from the company’s expectations, and investors should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond the company’s control and could materially affect the company’s results of operations, financial condition, cash flows, performance or future achievements or events, including those described under the section entitled Part I, Item 1A. “Risk Factors” of the company's 2021 Annual Report on Form 10-K. The company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law. Disclosures Forward Looking Statements Non-GAAP Measures Unaudited Financial Information Q4 2021 See the glossary for a description of the company's non-GAAP financial and operating metrics. Information About the Sale of the Data Center Properties Prior to the second quarter of 2021, the company operated through two reportable business segments— real estate investments in data centers and healthcare. During the three months ended June 30, 2021, the company's board of directors made a determination to sell the company's data center assets. On May 19, 2021, the company and certain of its wholly-owned subsidiaries entered into a purchase and sale agreement for the sale of up to 29 data center properties, which constituted the entirety of the company's data center segment. On July 22, 2021, the company completed the sale of its 29 data center properties. The company has classified the assets and liabilities in its data center segment as held for sale on the consolidated balance sheet as of December 31, 2020. As of December 31, 2021, the company had no assets or liabilities held for sale related to the data center properties. Additionally, operations of the data center properties are classified as income from discontinued operations on the consolidated statements of comprehensive income for all periods presented.


 
Section Page Supplemental Information as of December 31, 2021 See the glossary for a description of the company's non-GAAP financial and operating metrics. Corporate Address 1001 Water Street Suite 800 Tampa, FL 33602 Transfer Agent By Regular Mail: Computershare Alternative Investments P.O. Box 43007 Providence, RI 02940-3007 By Overnight Delivery: Computershare Alternative Investments 150 Royall Street, Suite 101 Canton, MA 02021 Contact Information Investor Support 833-404-4107 Miles Callahan, Vice President of Capital Markets and Investor Relations IR@silarealtytrust.com www.silarealtytrust.com Q4 2021 Quarterly Financial Summary .................................................... 3 Financial Statistics and Ratios .................................................... 4 Consolidated Balance Sheets ..................................................... 5 Consolidated Statements of Comprehensive Income ............... 6 FFO and AFFO ............................................................................. 7 EBITDA and EBITDAre ................................................................ 8 Net Operating Income (NOI) ...................................................... 9 Same Store NOI and Occupancy Trends .................................... 10 Debt ............................................................................................ 11 Acquisitions and Dispositions .................................................... 12 Property Map ............................................................................. 14 Diversification Statistics ............................................................. 15 Portfolio ..................................................................................... 17 Glossary ...................................................................................... 21


 
Three Months Ended Financial Results December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 Rental revenue $ 43,606 $ 43,063 $ 43,747 $ 42,422 $ 41,902 Income (loss) from continuing operations $ 12,077 $ (5,546) $ (249) $ (5,066) $ 6,509 Income from discontinued operations $ — $ 377,191 $ 16,305 $ 7,948 $ 8,239 Net income attributable to common stockholders $ 12,077 $ 371,645 $ 16,056 $ 2,882 $ 14,748 Net income attributable to common stockholders per diluted share $ 0.05 $ 1.66 $ 0.07 $ 0.01 $ 0.07 EBITDAre $ 33,632 $ 37,444 $ 59,841 $ 51,406 $ 52,042 FFO attributable to common stockholders $ 29,144 $ 615 $ 46,909 $ 39,267 $ 39,178 FFO attributable to common stockholders per diluted share $ 0.13 $ — $ 0.21 $ 0.18 $ 0.18 AFFO attributable to common stockholders $ 27,747 $ 27,708 $ 44,094 $ 36,143 $ 35,208 AFFO attributable to common stockholders per diluted share $ 0.12 $ 0.12 $ 0.20 $ 0.16 $ 0.16 Weighted average shares outstanding - diluted 225,031,906 223,661,774 223,082,912 222,481,179 222,475,926 As of Portfolio Metrics2 December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 Number of properties1 125 125 154 153 153 Rentable square feet (in thousands) 5,245 5,298 8,595 8,542 8,480 Weighted average rent escalation 2.3% 2.3% 2.4% 2.4% 2.4% Weighted average occupancy 99.5% 96.0% 93.3% 93.3% 93.0% Weighted average remaining lease term 9.5 years 9.8 years 9.3 years 9.4 years 9.6 years The following tables summarize the company's quarterly financial results and portfolio metrics. 3 Page Quarterly Financial Summary (dollars in thousands, except share data and per share amounts) See the glossary for a description of the company's non-GAAP financial and operating metrics. Q4 2021 (1) Includes one development property as of December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021. Includes two development properties as of December 31, 2020. (2) Data as of June 30, 2021, March 31, 2021 and December 31, 2020 includes data center properties that were sold on July 22, 2021.


 
Three Months Ended Adjusted Interest Coverage Ratio December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 Interest expense, adjusted6 $ 5,766 $ 37,386 $ 13,377 $ 13,208 $ 13,886 EBITDA 33,718 425,761 50,574 40,979 52,472 Adjusted interest coverage ratio 5.8 x 11.4 x 3.8 x 3.1 x 3.8 x As of Net Debt Ratios December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 Principal debt outstanding $ 500,000 $ 520,000 $ 1,404,184 $ 1,390,298 $ 1,391,422 Less: cash and cash equivalents 32,359 75,363 47,921 51,039 53,174 Net debt 467,641 444,637 1,356,263 1,339,259 1,338,248 EBITDAre annualized2 134,528 149,776 228,328 205,624 208,168 Net debt to EBITDAre ratio 3.5 x 3.0 x 5.9 x 6.5 x 6.4 x Net debt $ 467,641 $ 444,637 $ 1,356,263 $ 1,339,259 $ 1,338,248 Fair market value of real estate investments 2,316,342 2,282,706 3,550,273 3,259,303 3,256,885 Net debt leverage ratio 20.2 % 19.5 % 38.2 % 41.1 % 41.1 % Financial Metrics December 31, 2021 Other Key Metrics December 31, 2021 Net debt leverage ratio 20.2 % Total real estate investment $ 2,246,921 Net debt to EBITDAre ratio 3.5 x Net asset value per share4,5 $ 8.20 Adjusted interest coverage ratio 5.8 x Class A annualized distribution per share $ 0.40 Liquidity3 $ 532,359 Class I annualized distribution per share $ 0.40 Class T annualized distribution per share $ 0.32 Class T2 annualized distribution per share $ 0.32 Financial Statistics and Ratios1 (dollars in thousands, except per share amounts) See the glossary for a description of the company's non-GAAP financial and operating metrics. 4 Page (1) Data for the three months ended September 30, 2021, June 30, 2021, March 31, 2021 and December 31, 2020 includes data center properties that were sold on July 22, 2021. (2) EBITDAre is annualized based on actual quarter EBITDAre. (3) Liquidity represents cash and cash equivalents of $32.4 million and borrowing base availability on the company’s credit facility of $500.0 million as of December 31, 2021. (4) The estimated net asset value per share was calculated as of May 31, 2021. (5) On July 20, 2021, the company's board of directors approved an updated estimated net asset value per share, of $9.95 of the company's common stock as of May 31, 2021. The special cash distribution reduces the estimated net asset value per share by $1.75, resulting in a new estimated net asset value per share of $8.20, effective July 26, 2021. (6) Interest expense, adjusted, for the three months ended September 30, 2021, includes one-time costs associated with the sale of the data center portfolio, inclusive of defeasance and other loan costs in the amount of $26.1 million. Q4 2021


 
December 31, 2021 December 31, 2020 ASSETS Real estate: Land $ 163,992 $ 168,969 Buildings and improvements, less accumulated depreciation of $165,784 and $119,947, respectively 1,648,685 1,661,351 Construction in progress 14,628 19,232 Total real estate, net 1,827,305 1,849,552 Cash and cash equivalents 32,359 53,174 Acquired intangible assets, less accumulated amortization of $71,067 and $49,866, respectively 181,639 197,901 Goodwill 23,284 23,955 Right-of-use assets - operating leases 21,737 22,499 Right-of-use assets - finance lease 2,296 2,527 Notes receivable, net — 31,262 Other assets, net 66,365 64,669 Assets held for sale, net 22,570 959,750 Total assets $ 2,177,555 $ 3,205,289 LIABILITIES AND STOCKHOLDERS’ EQUITY Liabilities: Notes payable, net of deferred financing costs of $0 and $682, respectively $ — $ 146,645 Credit facility, net of deferred financing costs of $3,226 and $5,900, respectively 496,774 932,100 Accounts payable and other liabilities 39,597 67,946 Acquired intangible liabilities, less accumulated amortization of $4,444 and $3,122, respectively 12,962 11,971 Operating lease liabilities 23,758 23,926 Finance lease liabilities 2,636 2,843 Liabilities held for sale, net 698 365,985 Total liabilities 576,425 1,551,416 Stockholders’ equity: Preferred stock, $0.01 par value per share, 100,000,000 shares authorized; none issued and outstanding — — Common stock, $0.01 par value per share, 510,000,000 shares authorized; 238,226,119 and 234,957,801 shares issued, respectively; 224,179,939 and 222,045,522 shares outstanding, respectively 2,242 2,220 Additional paid-in capital 2,004,404 1,983,361 Accumulated distributions in excess of earnings (400,669) (311,264) Accumulated other comprehensive loss (4,847) (20,444) Total stockholders’ equity 1,601,130 1,653,873 Total liabilities and stockholders’ equity $ 2,177,555 $ 3,205,289 Consolidated Balance Sheets (dollars in thousands, except share data) See the glossary for a description of the company's non-GAAP financial and operating metrics. 5 Page Q4 2021


 
Three Months Ended December 31, Year Ended December 31, 2021 2020 2021 2020 Revenue: Rental revenue $ 43,606 $ 41,902 $ 172,838 $ 165,781 Expenses: Rental expenses 3,192 2,548 12,705 15,187 General and administrative expenses 6,785 6,721 26,395 16,681 Internalization Transaction expenses — — — 3,640 Asset management fees — — — 12,604 Depreciation and amortization 17,161 17,135 70,259 69,849 Impairment loss on real estate — — 27,166 — Impairment loss on goodwill — — 671 — Total expenses 27,138 26,404 137,196 117,961 Gain on real estate dispositions 89 439 89 3,142 Income from operations 16,557 15,937 35,731 50,962 Interest and other expense, net 4,480 9,428 34,515 42,025 Income from continuing operations 12,077 6,509 1,216 8,937 Income from discontinued operations — 8,239 401,444 27,839 Net income attributable to common stockholders $ 12,077 $ 14,748 $ 402,660 $ 36,776 Other comprehensive income (loss): Unrealized income (loss) on interest rate swaps, net $ 5,789 $ 3,150 $ 15,597 $ (15,740) Other comprehensive income (loss) 5,789 3,150 15,597 (15,740) Comprehensive income attributable to common stockholders $ 17,866 $ 17,898 $ 418,257 $ 21,036 Weighted average number of common shares outstanding: Basic 224,054,323 221,863,141 223,325,293 221,436,617 Diluted 225,031,906 222,475,926 224,293,339 221,622,444 Net income per common share attributable to common stockholders: Basic: Continuing operations $ 0.05 $ 0.03 $ — $ 0.04 Discontinued operations — 0.04 1.80 0.13 Net income attributable to common stockholders $ 0.05 $ 0.07 $ 1.80 $ 0.17 Diluted: Continuing operations $ 0.05 $ 0.03 $ — $ 0.04 Discontinued operations — 0.04 1.79 0.13 Net income attributable to common stockholders $ 0.05 $ 0.07 $ 1.79 $ 0.17 Consolidated Statements of Comprehensive Income (dollars in thousands, except share data and per share amounts) See the glossary for a description of the company's non-GAAP financial and operating metrics. 6 Page Q4 2021


 
Three Months Ended December 31, Year Ended December 31, 2021 2020 2021 2020 Net income attributable to common stockholders $ 12,077 $ 14,748 $ 402,660 $ 36,776 Adjustments: Depreciation and amortization1 17,156 24,869 81,999 105,476 Gain on real estate disposition from continuing operations (89) (439) (89) (3,142) Gain on real estate dispositions from discontinued operations — — (395,801) — Impairment loss on real estate — — 27,166 — FFO attributable to common stockholders $ 29,144 $ 39,178 $ 115,935 $ 139,110 Adjustments: Amortization of intangible assets and liabilities2 141 (613) (1,098) (4,680) Reduction in the carrying amount of right-of-use assets - operating leases and finance lease, net 186 268 860 970 Straight-line rent3 (3,011) (5,015) (15,503) (21,161) Internalization transaction expenses4 — — — 3,640 Amortization of discount of deferred liability — 54 272 54 Impairment loss on goodwill5 — — 671 — Loss on debt extinguishment — — 28,751 — Amortization of deferred financing costs 664 1001 3,425 3,884 Stock-based compensation 623 335 2,379 437 AFFO attributable to common stockholders $ 27,747 $ 35,208 $ 135,692 $ 122,254 Weighted average common shares outstanding - basic 224,054,323 221,863,141 223,325,293 221,436,617 Weighted average common shares outstanding - diluted 225,031,906 222,475,926 224,293,339 221,622,444 Weighted average common shares outstanding - diluted for FFO and AFFO 225,031,906 222,475,926 224,293,339 221,622,444 Net income per common share - basic $ 0.05 $ 0.07 $ 1.80 $ 0.17 Net income per common share - diluted $ 0.05 $ 0.07 $ 1.79 $ 0.17 FFO per common share - basic $ 0.13 $ 0.18 $ 0.52 $ 0.63 FFO per common share - diluted $ 0.13 $ 0.18 $ 0.52 $ 0.63 AFFO per common share - basic $ 0.12 $ 0.16 $ 0.61 $ 0.55 AFFO per common share - diluted $ 0.12 $ 0.16 $ 0.60 $ 0.55 (dollars in thousands, except share data and per share amounts) FFO and AFFO See the glossary for a description of the company's non-GAAP financial and operating metrics. 7 Page (1) During the years ended December 31, 2021 and 2020, the company wrote off in-place lease intangible assets in the amounts of approximately $1.1 million and $4.7 million, respectively, by accelerating the amortization of the acquired intangible assets. (2) Under GAAP, certain intangibles are accounted for at cost and reviewed for impairment. However, because real estate values and market lease rates historically rise or fall with market conditions, management believes that by excluding charges related to amortization of these intangibles, AFFO provides useful supplemental information on the performance of the real estate. During the year ended December 31, 2020, the company wrote off an above-market lease intangible asset in the amount of approximately $0.3 million, by accelerating the amortization of the acquired intangible asset and one below-market lease intangible liability in the amount of approximately $2.0 million by accelerating the amortization of the acquired intangible liability. (3) Under GAAP, rental revenue is recognized on a straight-line basis over the terms of the related lease (including rent holidays, if applicable). This may result in income recognition that is significantly different than the underlying contract terms. During the years ended December 31, 2021 and 2020, the company wrote off approximately $0.1 million, respectively, of straight-line rent. By adjusting for the change in straight-line rent receivable, AFFO may provide useful supplemental information on the realized economic impact of lease terms, providing insight on the expected contractual cash flows of such lease terms, and aligns with its analysis of operating performance. (4) Under GAAP, acquisition fees and expenses related to transactions determined to be business combinations are expensed as incurred. Internalization Transaction expenses consisted primarily of legal fees, as well as fees for other professional and financial advisors incurred in connection with the internalization transaction. The company believes that adjusting for such non-recurring items provides useful supplemental information because such expenses may not be reflective of ongoing operations and aligns with its analysis of operating performance. (5) During the year ended December 31, 2021, the company wrote off goodwill related to three reporting units in the amount of approximately $0.7 million, which was originally recognized as a part of the internalization transaction on September 30, 2020. The company believes that adjusting for such non-recurring items provides useful supplemental information because such adjustments may not be reflective of ongoing operations and aligns with its analysis of operating performance. Q4 2021


 
Three Months Ended December 31, Year Ended December 31, 2021 2020 2021 2020 Net income attributable to common stockholders $ 12,077 $ 14,748 $ 402,660 $ 36,776 Adjustments: Interest and other expense, net2 4,480 12,849 66,354 55,651 Depreciation and amortization 17,161 24,875 82,018 105,483 EBITDA $ 33,718 $ 52,472 $ 551,032 $ 197,910 Gain on real estate disposition from continuing operations (89) (439) (89) (3,142) Gain on real estate dispositions from discontinued operations — — (395,801) — Impairment loss on real estate — — 27,166 — Cash deposits interest 3 9 15 178 EBITDAre $ 33,632 $ 52,042 $ 182,323 $ 194,946 EBITDA and EBITDAre1 (dollars in thousands) See the glossary for a description of the company's non-GAAP financial and operating metrics. 8 Page Q4 2021 (1) Data for the three months ended December 31, 2020 and year ended December 31, 2021 and 2020 includes the 29 data center properties sold on July 22, 2021. (2) Interest and other expense, net, for the year ended December 31, 2021, includes one-time costs associated with the sale of the data center portfolio, inclusive of defeasance and other loan costs in the amount of $26.1 million.


 
Cash Net Operating Income Three Months Ended December 31, Year Ended December 31, 2021 2020 2021 2020 Rental revenue $ 43,606 $ 41,902 $ 172,838 $ 165,781 Rental expenses (3,192) (2,548) (12,705) (15,187) Net operating income 40,414 39,354 160,133 150,594 Adjustments: Straight-line rent (3,011) (3,704) (12,994) (15,575) Amortization of above- and below-market leases, net 141 176 612 1,090 Reduction in the carrying amount of right-of-use assets - operating ground leases 124 124 496 497 Cash NOI $ 37,668 $ 35,950 $ 148,247 $ 136,606 Cash NOI margin 86.4 % 85.8 % 85.8 % 82.4 % Cash NOI yield2 6.6 % 6.5 % 6.5 % 6.1 % Net Operating Income (NOI)1 (dollars in thousands) See the glossary for a description of the company's non-GAAP financial and operating metrics. 9 Page (1) Attributable to continuing operations. (2) Calculated using annualized NOI for the three months ended December 31, 2021 and 2020, respectively, and actual NOI for the year ended December 31, 2021 and 2020, respectively, to weighted average real estate investment since inception. Q4 2021


 
118 Properties1 Same Store NOI and Occupancy Trends See the glossary for a description of the company's non-GAAP financial and operating metrics. 10 Page (1) Each quarter's results are based on properties owned and operated as of October 1, 2020, and excludes the 29 data center properties that were sold on July 22, 2021 and one land parcel that formerly contained a healthcare property held for sale as of December 31, 2021. Q4 2021 N et O pe ra ti ng In co m e End of Period O ccupancy $39.2 $38.9 $39.1 $39.1 $39.2 99.2% 99.5% 99.5% 99.5% 99.5% 4Q20 1Q21 2Q21 3Q21 4Q21 $0M $9M $18M $27M $36M $45M 40% 50% 60% 70% 80% 90% 100%


 
$400M $100M 2022 2023 2024 2025 2026 2027+ $0M $100M $200M $300M $400M $500M $600M 5 Unsecured Credit Facility Key Covenants1,2 Required Actual Ratio of total indebtedness to total gross asset value ≤ 60.0% 23.8 % Ratio of secured indebtedness to total gross asset value ≤ 40.0% 0.0 % Ratio of adjusted EBITDA to fixed charges ≥ 1.75x 6.64x Ratio of unencumbered adjusted NOI to unsecured interest expense ≥ 2.00x 6.16x The table above includes a summary of key financial covenants for the company's credit facility, as defined and calculated per the terms of the facility's credit agreement. These calculations, which are not based on GAAP measurements, are presented to investors to show that the company is in compliance with the covenants and are not measures of the company's liquidity or performance. Debt Summary1,2 Fixed rate debt Amount Rate3 % of Total Credit facility term loans, fixed through interest rate swaps 400.0 3.3 % 80.0 % Total fixed rate debt 400.0 3.3 % 80.0 % Variable rate debt4 Credit facility term loans 100.0 1.8 % 20.0 % Total variable rate debt 100.0 1.8 % 20.0 % Total principal debt $ 500.0 3.0 % 100.0 % Debt (dollars in millions) Debt Maturities1,2 See the glossary for a description of the company's non-GAAP financial and operating metrics. 11 Page (1) On February 15, 2022, the company, the operating partnership and certain of its subsidiaries, entered into a new revolving credit agreement, with Truist Bank, as Administrative Agent for the lenders, for aggregate commitments available of up to $500,000,000, which may be increased, subject to lender approval, through incremental term loans and/or revolving loan commitments in an aggregate amount not to exceed $1,000,000,000. The maturity date for the new revolving credit agreement is February 15, 2026, which, at the company's election, may be extended for a period of six-months on no more than two occasions, subject to certain conditions, including the payment of an extension fee. The new revolving credit agreement was entered into to replace the company's prior $500,000,000 revolving line of credit, which had a maturity date of April 27, 2022, with the option to extend for one twelve-month period. The company did not exercise the option to extend. Upon closing of the new revolving credit agreement, the company extinguished all commitments associated with the prior revolving line of credit. Simultaneously with the new revolving credit agreement’s execution, on February 15, 2022, the company, the operating partnership, and certain of its subsidiaries, entered into a new term loan agreement, with Truist Bank, as Administrative Agent for the lenders. The new term loan agreement was fully funded at closing, and is made up of aggregate commitments of $300,000,000, which may be increased, subject to lender approval, to an aggregate amount not to exceed $600,000,000. The new term loan agreement has a maturity date of December 31, 2024, and, at the company's election, may be extended for a period of six-months on no more than two occasions, subject to the satisfaction of certain conditions, including the payment of an extension fee. The new term loan agreement was entered into to replace the company's prior term loan, which was paid off in its entirety upon closing of the new revolving credit agreement and the new term loan agreement. The new revolving credit agreement and the new term loan agreement have aggregate commitments available of $800,000,000. (2) These requirements and measurements are as of December 31, 2021 are based on the calculation methods required by the company's prior credit agreement. (3) Weighted average interest rate as of December 31, 2021. (4) LIBOR plus an applicable margin based on the company's debt agreements. On September 29, 2021, the company received consent for the acceleration of the applicable margin adjustment date on the credit facility, reducing the applicable margin from 2.25% to 1.75%, effective September 29, 2021. Per the language in the credit agreement, the applicable margin adjustment would not have otherwise taken place until December 1, 2021. (5) The revolving line of credit had $0 outstanding as of December 31, 2021. (6) Of this amount, two interest rate swaps with an aggregate notional amount of $150.0 million mature on April 27, 2023, prior to the term loan maturity of December 31, 2024. Credit Facility Revolver - Variable Credit Facility Term Loan - Fixed Through Swaps Credit Facility Term Loan - Variable Q4 2021 6


 
Acquisitions and Dispositions See the glossary for a description of the company's non-GAAP financial and operating metrics. 12 Page Q4 2021 2021 Acquisitions Date Acquired Property Rentable Square Feet Market State Acquisition Price (in thousands) 04/19/2021 Greenwood Healthcare Facility 53,560 Indianapolis IN $ 25,048 12/08/2021 Clive Healthcare Facilities1 132,617 Des Moines IA 46,424 Total Year-to-Date Acquisitions 186,177 $ 71,472 On February 10, 2022, the company sold one land parcel that formerly contained a healthcare property, or the Houston Healthcare Facility II, for $24,000,000. The company's net proceeds at closing from the disposition of the Houston Healthcare Facility II were approximately $22,876,000, after transaction costs and other pro- rations, subject to additional transaction costs paid subsequent to the closing date. (1) The Clive Healthcare Facilities consists of three healthcare properties and two undeveloped land parcels. 2021 Dispositions Date Disposed Property Rentable Square Feet Market State Sale Price (in thousands) Net Proceeds (in thousands) 10/21/2021 St. Louis Healthcare Facility 21,823 St. Louis MO $ 6,120 $ 5,973 12/22/2021 Grapevine Healthcare Facility 61,400 Dallas TX 7,000 6,669 83,223 $ 13,120 $ 12,642 On March 10, 2022, the company purchased one healthcare property, or the Yukon Healthcare Facility, for an aggregate purchase price of approximately $19,430,000. The Yukon Healthcare Facility is in the Yukon market of Oklahoma and is composed of approximately 45,624 rentable square feet.


 
Acquisitions and Dispositions (Continued) See the glossary for a description of the company's non-GAAP financial and operating metrics. 13 Page Q4 2021 On July 22, 2021, the company completed the sale of its data center portfolio, consisting of 29 data center properties composing 3.3 million rentable square feet, for an aggregate sale price of $1.32 billion, and generated net proceeds of approximately $1.30 billion. 2021 Data Center Dispositions Date Disposed Property Rentable Square Feet Market State 07/22/2021 Alpharetta Data Center 77,322 Atlanta GA 07/22/2021 Atlanta Data Center 997,248 Atlanta GA 07/22/2021 Andover Data Center 153,000 Boston MA 07/22/2021 Norwalk Data Center 167,691 Bridgeport CT 07/22/2021 Canton Data Center 29,960 Canton OH 07/22/2021 Charlotte Data Center 52,924 Charlotte NC 07/22/2021 Chicago Data Center 115,352 Chicago IL 07/22/2021 Elgin Data Center 65,745 Chicago IL 07/22/2021 Cincinnati Data Center 69,826 Cincinnati OH 07/22/2021 Blythewood Data Center 64,637 Columbia SC 07/22/2021 Flint Data Center 32,500 Flint MI 07/22/2021 Houston Data Center 103,200 Houston TX 07/22/2021 Indianapolis Data Center 43,724 Indianapolis IN 07/22/2021 Hawthorne Data Center 288,000 Los Angeles CA 07/22/2021 Eagan Data Center 87,402 Minneapolis MN 07/22/2021 Minnetonka Data Center 135,240 Minneapolis MN 07/22/2021 Franklin Data Center 71,726 Nashville TN 07/22/2021 Somerset Data Center 36,118 New York City NJ 07/22/2021 Oklahoma City Data Center 92,456 Oklahoma City OK 07/22/2021 King of Prussia Data Center 50,000 Philadelphia PA 07/22/2021 Tempe Data Center 44,244 Phoenix AZ 07/22/2021 Tempe Data Center II 58,560 Phoenix AZ 07/22/2021 Rancho Cordova Data Center 69,048 Sacramento CA 07/22/2021 Rancho Cordova Data Center II 63,791 Sacramento CA 07/22/2021 San Jose Data Center 76,410 San Jose CA 07/22/2021 Sunnyvale Data Center 76,573 San Jose CA 07/22/2021 Waco Data Center 43,596 Waco TX 07/22/2021 McLean Data Center 69,329 Washington, D.C. VA 07/22/2021 McLean Data Center II 62,002 Washington, D.C. VA Total Year-to-Date Dispositions 3,297,624


 
Property Map (as of December 31, 2021) See the glossary for a description of the company's non-GAAP financial and operating metrics. 14 Page Q4 2021


 
10.2% 8.0% 6.8% 5.6% 4.8% 4.2% 3.9% 3.3% 2.8% 2.6% Houston Dallas Oklahoma City San Antonio Philadelphia Akron Des Moines Riverside Austin Cincinnati Total Statistics As of December 31, 2021 2020 Rentable square feet 5,244,933 5,182,190 Number of properties4 125 124 Weighted average annualized base rent per leased square foot $29.59 $29.02 Weighted average remaining lease term 9.5 years 10.4 years Weighted average occupancy 99.5 % 96.3 % Top 10 Markets1 As of December 31, 2021 As of December 31, 2020 Rentable Square Feet % Leased3 Rentable Square Feet % Leased3 Houston 490,742 100.0 % 593,111 84.1 % Dallas 312,590 100.0 % 373,990 83.3 % Oklahoma City 433,513 100.0 % 433,513 100.0 % San Antonio 293,782 100.0 % 293,782 96.3 % Philadelphia 122,356 100.0 % 122,356 100.0 % Akron 191,269 100.0 % 191,269 100.0 % Des Moines 244,548 100.0 % 111,931 100.0 % Riverside 73,643 100.0 % 73,643 100.0 % Austin 125,271 100.0 % 125,271 100.0 % Cincinnati 237,496 100.0 % 237,496 100.0 % Total 2,525,210 100.0 % 2,556,362 93.5 % Top 10 Markets1,2 Real Estate Diversification See the glossary for a description of the company's non-GAAP financial and operating metrics. 15 Page (1) Based on annualized December 2021 base rent. (2) Represents each market's annualized December 2021 base rent as a percentage of total market annualized December 2021 base rent. (3) Weighted average occupancy based on rentable square feet. (4) Includes one development property as of December 31, 2021 and two development properties as of December 31, 2020. Q4 2021


 
14.8% 6.2% 55.8% 23.2% 36.7% 23.8% 26.2% 11.8% 1.5% 89.6% 91.0% 10.4% 9.0% Number of Properties Annualized Base Rent (December 2021) A nn ua liz ed B as e Re nt Square Feet 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 Thereafter $0M $10M $20M $30M $40M $50M $60M $70M $80M 0.0M 0.5M 1.0M 1.5M 2.0M 2.5M 15.6% 8.0% 7.2% 6.5% 6.5% 6.0% 5.6% 4.6% 3.5% 3.4% Post Acute Medical, LLC and affiliates Baylor Scott and White Health Board of Regents of the Univ. of Texas System Select Medical Holdings Corporation Confidential Tenant #11 Confidential Tenant #10 Genesis Care Pty Ltd Surgery Partners, Inc. Confidential Tenant #9 Confidential Tenant #4 Property Diversification1Tenant Diversification1,2 Real Estate Diversification Lease Expirations Single/Multi-Tenant Breakdown See the glossary for a description of the company's non-GAAP financial and operating metrics. 16 Page (1) Based on annualized December 2021 base rent. (2) Includes tenants under common control. (3) Includes development property. (4) Based on rental revenue for the year ended December 31, 2021. (5) All credit ratings are from major credit rating agencies. Parent credit rating is used where tenant is not rated. Annualized Base Rent (December 2021) Expiring Leased Square Feet Medical Office Building Inpatient Rehabilitation Facility Acute Care Hospital Long-Term Acute Care Hospital Other Single Tenant Multi-Tenant Q4 2021 3 Tenant Credit Concentrations4,5 Investment Grade Rated Tenant/ Guarantor Non-Investment Grade Rated Tenant/Guarantor Non-Rated Tenant/Guarantor Non-Rated Tenant/Guarantor affiliated with Investment Grade Rated Partner


 
Market Property Name State Rentable Square Feet Date Acquired Occupancy Property Subtype Akron Akron Healthcare Facility OH 98,705 10/4/2019 100.0 % Medical Office Building Akron Akron Healthcare Facility II OH 38,564 10/4/2019 100.0 % Medical Office Building Akron Akron Healthcare Facility III OH 54,000 10/4/2019 100.0 % Long-Term Acute Care Hospital Alexandria Alexandria Healthcare Facility LA 15,600 10/4/2019 100.0 % Medical Office Building Appleton Appleton Healthcare Facility WI 7,552 10/4/2019 100.0 % Medical Office Building Augusta Augusta Healthcare Facility ME 51,000 7/22/2015 100.0 % Medical Office Building Augusta Oakland Healthcare Facility ME 20,000 7/22/2015 100.0 % Medical Office Building Austin Austin Healthcare Facility TX 66,095 3/31/2017 100.0 % Inpatient Rehabilitation Facility Austin Austin Healthcare Facility II TX 18,275 10/4/2019 100.0 % Medical Office Building Austin Luling Healthcare Facility TX 40,901 7/30/2015 100.0 % Long-Term Acute Care Hospital Beaumont Beaumont Healthcare Facility TX 61,000 3/31/2017 100.0 % Inpatient Rehabilitation Facility Boston Stoughton Healthcare Facility MA 180,744 12/23/2014 100.0 % Long-Term Acute Care Hospital Bremerton Silverdale Healthcare Facility WA 25,892 8/25/2017 100.0 % Medical Office Building Bremerton Silverdale Healthcare Facility II WA 19,184 9/20/2017 100.0 % Medical Office Building Brownsville Harlingen Healthcare Facility TX 38,111 10/4/2019 100.0 % Medical Office Building Chicago Aurora Healthcare Facility IL 24,722 3/30/2017 100.0 % Medical Office Building Cincinnati Cincinnati Healthcare Facility OH 14,868 10/29/2014 100.0 % Medical Office Building Cincinnati Cincinnati Healthcare Facility II OH 139,428 7/22/2015 100.0 % Medical Office Building Cincinnati Cincinnati Healthcare Facility III OH 41,600 7/22/2015 100.0 % Medical Office Building Cincinnati Florence Healthcare Facility KY 41,600 7/22/2015 100.0 % Medical Office Building Corpus Christi Corpus Christi Healthcare Facility TX 25,102 12/22/2016 100.0 % Medical Office Building Dallas Allen Healthcare Facility TX 42,627 3/31/2017 100.0 % Inpatient Rehabilitation Facility Dallas Carrollton Healthcare Facility TX 21,990 4/27/2018 100.0 % Medical Office Building Dallas Dallas Healthcare Facility TX 62,390 10/4/2019 100.0 % Acute Care Hospital Dallas Fort Worth Healthcare Facility TX 83,464 12/31/2014 100.0 % Acute Care Hospital Dallas Fort Worth Healthcare Facility II TX 8,268 12/31/2014 100.0 % Medical Office Building Dallas Fort Worth Healthcare Facility III TX 36,800 12/23/2015 100.0 % Medical Office Building Dallas Frisco Healthcare Facility TX 57,051 10/4/2019 100.0 % Inpatient Rehabilitation Facility Denver Denver Healthcare Facility CO 131,210 10/4/2019 100.0 % Long-Term Acute Care Hospital Des Moines Clive Healthcare Facility IA 58,156 11/26/2018 100.0 % Medical Office Building Des Moines Clive Healthcare Facility II IA 63,224 12/8/2021 100.0 % Medical Office Building Des Moines Clive Healthcare Facility III IA 33,974 12/8/2021 100.0 % Medical Office Building Des Moines Clive Healthcare Facility IV IA 35,419 12/8/2021 100.0 % Medical Office Building Des Moines Clive Undeveloped Land IA — 12/8/2021 — % Undeveloped Land Des Moines Clive Undeveloped Land II IA — 12/8/2021 — % Undeveloped Land Des Moines Grimes Healthcare Facility IA 14,669 2/19/2020 100.0 % Medical Office Building Des Moines Indianola Healthcare Facility IA 18,116 9/26/2018 100.0 % Medical Office Building Des Moines Indianola Healthcare Facility II IA 20,990 9/26/2018 100.0 % Medical Office Building Destin Crestview Healthcare Facility FL 5,685 10/4/2019 100.0 % Medical Office Building Destin Fort Walton Beach Healthcare Facility FL 9,017 10/4/2019 100.0 % Medical Office Building Portfolio See the glossary for a description of the company's non-GAAP financial and operating metrics. 17 Page Q4 2021


 
Portfolio (Continued) Market Property Name State Rentable Square Feet Date Acquired Occupancy Property Subtype Destin Santa Rosa Beach Healthcare Facility FL 5,000 10/4/2019 100.0 % Medical Office Building Elkhart Goshen Healthcare Facility IN 15,462 10/4/2019 100.0 % Medical Office Building Fayetteville Fayetteville Healthcare Facility AR 55,740 10/4/2019 100.0 % Acute Care Hospital Fort Myers Bonita Springs Healthcare Facility FL 9,800 10/4/2019 100.0 % Medical Office Building Fort Myers Fort Myers Healthcare Facility FL 32,148 10/4/2019 100.0 % Medical Office Building Fort Myers Fort Myers Healthcare Facility II FL 47,089 10/4/2019 100.0 % Medical Office Building Fort Myers Lehigh Acres Healthcare Facility FL 5,746 10/4/2019 100.0 % Medical Office Building Grand Rapids Grand Rapids Healthcare Facility MI 107,781 12/7/2016 76.1 % Medical Office Building Green Bay Bellevue Healthcare Facility WI 5,838 10/4/2019 100.0 % Medical Office Building Green Bay De Pere Healthcare Facility WI 7,100 10/4/2019 100.0 % Medical Office Building Green Bay Howard Healthcare Facility WI 7,552 10/4/2019 100.0 % Medical Office Building Green Bay Manitowoc Healthcare Facility WI 7,987 10/4/2019 100.0 % Medical Office Building Green Bay Manitowoc Healthcare Facility II WI 36,090 10/4/2019 100.0 % Medical Office Building Green Bay Marinette Healthcare Facility WI 4,178 10/4/2019 100.0 % Medical Office Building Green Bay Sturgeon Bay Healthcare Facility WI 3,100 10/4/2019 100.0 % Medical Office Building Hammond Hammond Healthcare Facility LA 63,000 10/4/2019 100.0 % Acute Care Hospital Hammond Hammond Healthcare Facility II LA 23,835 10/4/2019 100.0 % Long-Term Acute Care Hospital Houston Houston Healthcare Facility TX 13,645 7/31/2014 100.0 % Medical Office Building Houston Houston Healthcare Facility II1 TX — 6/30/2015 — % Houston Houston Healthcare Facility III TX 16,217 10/4/2019 100.0 % Medical Office Building Houston Katy Healthcare Facility TX 34,296 6/8/2018 100.0 % Other Houston Webster Healthcare Facility TX 53,514 6/5/2015 100.0 % Inpatient Rehabilitation Facility Houston Webster Healthcare Facility II TX 373,070 10/4/2019 100.0 % Acute Care Hospital Indianapolis Greenwood Healthcare Facility IN 53,560 4/19/2021 100.0 % Inpatient Rehabilitation Facility Jacksonville Jacksonville Healthcare Facility FL 13,082 10/4/2019 100.0 % Medical Office Building Kansas City Overland Park Healthcare Facility KS 54,568 2/17/2015 100.0 % Inpatient Rehabilitation Facility Lafayette Lafayette Healthcare Facility LA 73,824 10/4/2019 100.0 % Acute Care Hospital Lakeland Winter Haven Healthcare Facility FL 7,560 1/27/2015 100.0 % Medical Office Building Laredo Laredo Healthcare Facility TX 61,677 9/19/2019 100.0 % Medical Office Building Laredo Laredo Healthcare Facility II TX 118,132 9/19/2019 100.0 % Medical Office Building Las Vegas Henderson Healthcare Facility NV 6,685 10/4/2019 100.0 % Medical Office Building Las Vegas Las Vegas Healthcare Facility NV 56,220 6/24/2016 100.0 % Inpatient Rehabilitation Facility Las Vegas Las Vegas Healthcare Facility II NV 6,963 10/4/2019 100.0 % Medical Office Building Lexington Frankfort Healthcare Facility KY 4,000 10/4/2019 100.0 % Medical Office Building Little Rock Benton Healthcare Facility AR 104,419 10/17/2018 100.0 % Medical Office Building Little Rock Benton Healthcare Facility II AR 11,350 10/17/2018 100.0 % Medical Office Building Little Rock Bryant Healthcare Facility AR 23,450 10/17/2018 100.0 % Medical Office Building See the glossary for a description of the company's non-GAAP financial and operating metrics. 18 Page Q4 2021


 
Portfolio (Continued) Market Property Name State Rentable Square Feet Date Acquired Occupancy Property Subtype Little Rock Bryant Healthcare Facility II AR 16,425 8/16/2019 100.0 % Medical Office Building Little Rock Hot Springs Healthcare Facility AR 8,573 10/17/2018 100.0 % Medical Office Building Los Angeles El Segundo Healthcare Facility CA 12,163 10/4/2019 100.0 % Medical Office Building Lubbock Lubbock Healthcare Facility TX 102,143 10/4/2019 100.0 % Acute Care Hospital Martinsburg Fairlea Healthcare Facility WV 5,200 10/4/2019 100.0 % Medical Office Building New Orleans Covington Healthcare Facility LA 43,250 10/4/2019 100.0 % Long-Term Acute Care Hospital Oklahoma City Edmond Healthcare Facility OK 17,700 1/20/2016 100.0 % Medical Office Building Oklahoma City Newcastle Healthcare Facility OK 7,424 2/3/2016 100.0 % Medical Office Building Oklahoma City Oklahoma City Healthcare Facility OK 94,076 12/29/2015 100.0 % Acute Care Hospital Oklahoma City Oklahoma City Healthcare Facility II OK 41,394 12/29/2015 100.0 % Medical Office Building Oklahoma City Oklahoma City Healthcare Facility III OK 5,000 1/27/2016 100.0 % Medical Office Building Oklahoma City Oklahoma City Healthcare Facility IV OK 8,762 1/27/2016 100.0 % Medical Office Building Oklahoma City Oklahoma City Healthcare Facility V OK 43,676 2/11/2016 100.0 % Medical Office Building Oklahoma City Oklahoma City Healthcare Facility VI OK 14,676 3/7/2016 100.0 % Medical Office Building Oklahoma City Oklahoma City Healthcare Facility VII OK 102,978 6/22/2016 100.0 % Acute Care Hospital Oklahoma City Oklahoma City Healthcare Facility VIII OK 62,857 6/30/2016 100.0 % Acute Care Hospital Oklahoma City Oklahoma City Healthcare Facility IX OK 34,970 10/4/2019 100.0 % Medical Office Building Omaha Omaha Healthcare Facility NE 40,402 10/14/2015 100.0 % Other Oshkosh Oshkosh Healthcare Facility WI 8,717 10/4/2019 100.0 % Medical Office Building Philadelphia Marlton Healthcare Facility NJ 89,139 11/1/2016 100.0 % Inpatient Rehabilitation Facility Philadelphia Wyomissing Healthcare Facility PA 33,217 7/24/2015 100.0 % Acute Care Hospital Pittsburgh Clarion Healthcare Facility PA 33,000 6/1/2015 100.0 % Medical Office Building Poplar Bluff Poplar Bluff Healthcare Facility MO 71,519 9/19/2019 100.0 % Medical Office Building Providence New Bedford Healthcare Facility MA 70,657 10/4/2019 100.0 % Long-Term Acute Care Hospital Providence North Smithfield Healthcare Facility RI 92,944 10/4/2019 100.0 % Inpatient Rehabilitation Facility Riverside Palm Desert Healthcare Facility CA 6,963 10/4/2019 100.0 % Medical Office Building Riverside Rancho Mirage Healthcare Facility CA 47,008 3/1/2016 100.0 % Inpatient Rehabilitation Facility Riverside Rancho Mirage Healthcare Facility II CA 7,432 10/4/2019 100.0 % Medical Office Building Riverside Yucca Valley Healthcare Facility CA 12,240 10/4/2019 100.0 % Medical Office Building Saginaw Saginaw Healthcare Facility MI 87,843 12/21/2017 100.0 % Medical Office Building San Antonio New Braunfels Healthcare Facility TX 27,971 10/4/2019 100.0 % Long-Term Acute Care Hospital San Antonio San Antonio Healthcare Facility TX 44,746 6/29/2017 100.0 % Inpatient Rehabilitation Facility San Antonio San Antonio Healthcare Facility III TX 50,000 10/4/2019 100.0 % Inpatient Rehabilitation Facility San Antonio San Antonio Healthcare Facility IV TX 113,136 10/4/2019 100.0 % Inpatient Rehabilitation Facility San Antonio San Antonio Healthcare Facility V TX 57,929 10/4/2019 100.0 % Medical Office Building Sarasota Lakewood Ranch Healthcare Facility FL 10,919 10/4/2019 100.0 % Medical Office Building See the glossary for a description of the company's non-GAAP financial and operating metrics. 19 Page Q4 2021


 
Portfolio (Continued) Market Property Name State Rentable Square Feet Date Acquired Occupancy Property Subtype Savannah Savannah Healthcare Facility GA 48,184 10/4/2019 100.0 % Long-Term Acute Care Hospital Scranton Wilkes-Barre Healthcare Facility PA 15,996 10/4/2019 100.0 % Medical Office Building Sherman Sherman Healthcare Facility TX 57,576 11/20/2015 100.0 % Acute Care Hospital Sherman Sherman Healthcare Facility II TX 8,055 11/20/2015 100.0 % Medical Office Building St. Louis Bridgeton Healthcare Facility MO 66,914 10/4/2019 100.0 % Inpatient Rehabilitation Facility Tampa Tampa Healthcare Facility FL 33,822 9/8/2020 100.0 % Medical Office Building Tucson Tucson Healthcare Facility AZ 34,009 9/19/2019 100.0 % Medical Office Building Tucson Tucson Healthcare Facility II AZ 60,913 12/26/2019 100.0 % Inpatient Rehabilitation Facility Tucson Tucson Healthcare Facility III AZ 20,000 12/27/2019 100.0 % Medical Office Building Tucson Tucson Healthcare Facility IV2 AZ — 12/22/2020 — % Medical Office Building Valdosta Valdosta Healthcare Facility GA 24,750 11/28/2018 100.0 % Medical Office Building Valdosta Valdosta Healthcare Facility II GA 12,745 11/28/2018 100.0 % Medical Office Building Victoria Victoria Healthcare Facility TX 34,297 10/4/2019 100.0 % Inpatient Rehabilitation Facility Victoria Victoria Healthcare Facility II TX 28,752 10/4/2019 100.0 % Long-Term Acute Care Hospital Winston Winston-Salem Healthcare Facility NC 22,200 12/17/2014 100.0 % Medical Office Building . See the glossary for a description of the company's non-GAAP financial and operating metrics. 20 Page (1) On August 30, 2021, the company entered into a purchase and sale agreement for the sale of the Houston Healthcare Facility II, which was vacant. The purchase and sale agreement contained a requirement that the structures on the Houston Healthcare Facility II be demolished prior to the sale. The structures on the Houston Healthcare Facility II were demolished and the Houston Healthcare Facility II consisted solely of land as of December 31, 2021. On February 10, 2022, the company sold one land parcel that contained the Houston Healthcare Facility II for $24,000,000. The company's net proceeds at closing from the disposition of the Houston Healthcare Facility II were approximately $22,876,000, after transaction costs and other pro-rations, subject to additional transaction costs paid subsequent to the closing date. (2) Tucson Healthcare Facility IV was a development property as of December 31, 2021. The company placed the Tucson Healthcare Facility IV into service on February 8, 2022 and it is approximately 44,700 rentable square feet. The Tucson Healthcare Facility IV is currently 86% leased and will be 89% leased after an additional lease commences in May 2022. Q4 2021


 
Annualized Base Rent is the sum of each tenant’s base rent in the last month of the period multiplied by twelve, unless otherwise specified. Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre) are non-GAAP, supplemental performance measures defined as net income or loss, computed in accordance with GAAP, adjusted for interest expense, income tax expense (benefit), depreciation and amortization. EBITDAre also includes adjustments for impairment write-downs on real estate and gains or losses from the disposition of properties. EBITDA and EBITDAre are definitions promulgated by the National Association of Real Estate Investment Trusts (NAREIT). Each of these metrics are important indicators of the company’s operating performance. The following is a reconciliation of net income attributable to common stockholders, which is the most directly comparable GAAP financial measure, to EBITDA and EBITDAre for the following quarterly periods (amounts in thousands): Fair Market Value of Real Estate Investments is determined as fair market value of real estate-related investments based on the NAV (as defined below) calculated as of May 31, 2021, plus total aggregate cost of real estate investments acquired after that date and capital expenditures incurred on development properties not included in the then current NAV. Three Months Ended December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 Net income attributable to common stockholders $ 12,077 $ 371,645 $ 16,056 $ 2,882 $ 14,748 Adjustments: Interest and other expense, net1 4,480 36,822 12,922 12,130 12,849 Depreciation and amortization 17,161 17,294 21,596 25,967 24,875 EBITDA2 $ 33,718 $ 425,761 $ 50,574 $ 40,979 $ 52,472 Gain on real estate disposition from continuing operations (89) — — — (439) (Gain) loss on real estate dispositions from discontinued operations3 — (398,560) 2,759 — — Impairment loss on real estate — 10,241 6,502 10,423 — Cash deposits interest 3 2 6 4 9 EBITDAre2 $ 33,632 $ 37,444 $ 59,841 $ 51,406 $ 52,042 Glossary 21 Page Q4 2021 (1) Interest and other expense, net, for the three months ended September 30, 2021, includes one-time costs associated with the sale of the data center portfolio, inclusive of defeasance and other loan costs in the amount of $26.1 million. (2) Data for the three months ended September 30, 2021, June 30, 2021, March 31, 2021 and December 31, 2020 includes the 29 data center properties sold on July 22, 2021. (3) Represents gain on real estate dispositions related to the 29 data center properties sold on July 22, 2021. The company recognized a loss of $2.8 million in transaction costs during the three months ended June 30, 2021, resulting in the total gain being higher during the three months ended September 30, 2021.


 
Three Months Ended December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 Net income attributable to common stockholders $ 12,077 $ 371,645 $ 16,056 $ 2,882 $ 14,748 Adjustments: Depreciation and amortization1 17,156 17,289 21,592 25,962 24,869 Gain on real estate disposition from continuing operations (89) — — — (439) (Gain) loss on real estate dispositions from discontinued operations2 — (398,560) 2,759 — — Impairment loss on real estate — 10,241 6,502 10,423 — FFO attributable to common stockholders $ 29,144 $ 615 $ 46,909 $ 39,267 $ 39,178 Adjustments: Amortization of intangible assets and liabilities 141 13 (639) (613) (613) Reduction in the carrying amount of right-of-use assets - operating leases and finance lease, net 186 189 216 269 268 Straight-line rent3 (3,011) (3,414) (4,452) (4,626) (5,015) Amortization of discount of deferred liability — 163 55 54 54 Impairment loss on goodwill4 — — 431 240 — Loss on extinguishment of debt — 28,751 — — — Amortization of deferred financing costs 664 754 1,011 996 1,001 Stock-based compensation 623 637 563 556 335 AFFO attributable to common stockholders $ 27,747 $ 27,708 $ 44,094 $ 36,143 $ 35,208 The following is a reconciliation of net income attributable to common stockholders, which is the most directly comparable GAAP financial measure, to FFO and AFFO for the following quarterly periods (amounts in thousands): Glossary 22 Page (1) During the three months ended March 31, 2021, the company wrote off in-place lease intangible assets in the amount of approximately $1.1 million by accelerating the amortization of the acquired intangible assets. (2) Represents gain on real estate dispositions related to the 29 data center properties sold on July 22, 2021. The company recognized a loss of $2.8 million in transaction costs during the three months ended June 30, 2021, resulting in the total gain being higher during the three months ended September 30, 2021. (3) Under GAAP, rental revenue is recognized on a straight-line basis over the terms of the related lease (including rent holidays if applicable). This may result in income recognition that is significantly different than the underlying contract terms. During the three months ended March 31, 2021, the company wrote off approximately $0.1 million of straight-line rent. By adjusting for the change in straight-line rent receivable, AFFO may provide useful supplemental information on the realized economic impact of lease terms, providing insight on the expected contractual cash flows of such lease terms, and aligns with its analysis of operating performance. (4) During the three months ended September 30, 2021, the company wrote off goodwill related to two reporting units in the amount of approximately $0.4 million. During the three months ended March 31, 2021, the company wrote off goodwill related to one reporting unit in the amount of approximately $0.2 million. The goodwill was originally recognized as a part of the internalization transaction on September 30, 2020. The company believes that adjusting for such non-recurring items provides useful supplemental information because such adjustments may not be reflective of ongoing operations and aligns with its analysis of operating performance. Q4 2021 Funds From Operations (FFO) and Adjusted Funds From Operations (AFFO) are non-GAAP financial measures. FFO is calculated using the NAREIT definition: net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property and asset impairment write-downs, plus depreciation and amortization of real estate assets, and after adjustments for unconsolidated partnerships and 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 the company does, making comparisons less meaningful. In addition to FFO, the company uses AFFO as a supplemental financial performance measure because the company believes it provides to stakeholders a more complete understanding of the company’s sustainable performance. AFFO is a metric used by management to evaluate the company's dividend policy. The company calculates AFFO, a non-GAAP measure, by further adjusting FFO for the following items included in the determination of GAAP net income: amortization of above- and below-market leases, along with the net of right-of-use assets- operating leases and right-of-use assets- finance lease, resulting from above-and below-market leases, straight-line rent, acquisition expenses in connection with business combination transactions, discount amortization related to the deferred liability in connection with the internalization transaction, impairment loss on goodwill, (gain) loss on extinguishment of debt, amortization of deferred financing costs and stock-based compensation. Other REITs may use different methodologies for calculating AFFO and, accordingly, the company’s AFFO may not be comparable to other REITs. FFO and AFFO 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 operational performance. The method used to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operating performance and considered more prominent than the non-GAAP FFO and AFFO measures and the adjustments to GAAP in calculating FFO and AFFO.


 
Net Debt is defined as principal debt outstanding less cash and cash equivalents. Net Debt provides useful information to investors and management by calculating and monitoring the company’s leverage ratio. The following is a reconciliation of total debt, net, which is the most directly comparable GAAP financial measure to net debt, for the following quarterly periods (amounts in thousands): As of December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 Notes payable, net $ — $ — $ 449,780 $ 450,719 $ 451,617 Credit facility, net 496,774 516,506 947,979 932,546 932,100 Total debt, net 496,774 516,506 1,397,759 1,383,265 1,383,717 Deferred financing costs, net 3,226 3,494 6,425 7,033 7,705 Principal debt outstanding 500,000 520,000 1,404,184 1,390,298 1,391,422 Less: cash and cash equivalents 32,359 75,363 47,921 51,039 53,174 Net debt1 $ 467,641 $ 444,637 $ 1,356,263 $ 1,339,259 $ 1,338,248 Net Asset Value (NAV) is determined by the board of directors, at the recommendation of the company's audit committee, and based on the estimated value of the company’s assets, less the estimated value of the company’s liabilities, divided by the approximate number of shares outstanding on a fully diluted basis. This valuation is performed in accordance with the provisions of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the IPA in April 2013, in addition to guidance from the SEC. Liquidity is a non-GAAP financial metric that represents the outstanding cash and cash equivalents combined with the remaining borrowing base availability on the company’s credit facility at the end of the period. This metric provides useful information to investors and management when examining the company’s financing and investing decisions. Glossary 23 Page Q4 2021 (1) Data for the three months ended June 30, 2021, March 31, 2021 and December 31, 2020 includes the 29 data center properties sold on July 22, 2021. Interest Expense, Adjusted is a non-GAAP measure that represents interest and other expense, net, adjusted for cash deposits interest, other income, notes receivable interest income and amortization of origination fee. This metric provides useful information to investors because it is used for the calculation of adjusted interest coverage ratio. The following is a reconciliation of interest and other expense, net, which is the most directly comparable GAAP financial measure, to interest expense, adjusted for the following quarterly periods (amounts in thousands): Three Months Ended December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 Interest and other expense, net1 $ 4,480 $ 36,822 $ 12,922 $ 12,130 $ 12,849 Cash deposits interest 3 2 6 4 9 Other income 1,233 731 — 652 597 Notes receivable interest income 50 87 519 490 501 Amortization of origination fee — (256) (70) (68) (70) Interest expense, adjusted2 $ 5,766 $ 37,386 $ 13,377 $ 13,208 $ 13,886 (1) Interest and other expense, net, for the three months ended September 30, 2021, includes one-time costs associated with the sale of the data center portfolio, inclusive of defeasance and other loan costs in the amount of $26.1 million. (2) Data for the three months ended September 30, 2021, June 30, 2021, March 31, 2021 and December 31, 2020 includes the 29 data center properties sold on July 22, 2021.


 
Three Months Ended December 31, Year Ended December 31, 2021 2020 2021 2020 Rental revenue $ 43,606 $ 41,902 $ 172,838 $ 165,781 Rental expense (3,192) (2,548) (12,705) (15,187) Total NOI 40,414 39,354 160,133 150,594 Straight-line rent (3,011) (3,704) (12,994) (15,575) Amortization of above- and below-market leases, net 141 176 612 1,090 Reduction in the carrying amount of right-of-use assets - operating ground leases 124 124 496 497 Cash NOI 37,668 35,950 148,247 136,606 General and administrative expenses (6,785) (6,721) (26,395) (16,681) Internalization transaction expenses — — — (3,640) Asset management fees — — — (12,604) Depreciation and amortization (17,161) (17,135) (70,259) (69,849) Impairment loss on real estate — — (27,166) — Impairment loss on goodwill — — (671) — Gain on real estate disposition from continuing operations 89 439 89 3,142 Interest and other expense, net1 (4,480) (9,428) (34,515) (42,025) Straight-line rent 3,011 3,704 12,994 15,575 Amortization of above- and below-market leases, net (141) (176) (612) (1,090) Reduction in the carrying amount of right-of-use assets - operating ground leases (124) (124) (496) (497) Income from discontinued operations — 8,239 401,444 27,839 Net income attributable to common stockholders $ 12,077 $ 14,748 $ 402,660 $ 36,776 The following is a reconciliation of net income attributable to common stockholders, which is the most directly comparable GAAP financial measure, to Total NOI and Cash NOI, for the following periods (amounts in thousands): Glossary 24 Page Q4 2021 (1) Interest and other expense, net, for the year ended December 31, 2021, includes a loss on debt extinguishment in the amount of $5.0 million, due to the payoff of all the company's healthcare notes payable and a term loan of the credit facility on July 22, 2021. Net Operating Income (NOI) and Cash NOI are non-GAAP financial measures. NOI is defined as rental revenue, less rental expenses on an accrual basis, excluding general and administrative expenses, internalization transaction expenses, asset management fees, depreciation and amortization, impairment loss on real estate, impairment loss on goodwill, gain on real estate dispositions from continuing operations, interest and other expense, net and income from discontinued operations. Cash NOI is calculated to exclude the impact of certain GAAP adjustments to rental revenue, such as straight-line rent, amortization of above-market intangible lease assets and below-market lease intangible liabilities and the reduction in the carrying amount of right-of-use assets - operating ground leases, and is used to evaluate the cash-based performance of the company’s real estate portfolio. The company believes that NOI and Cash NOI both serve as useful supplements to net income because they allow investors and management to measure unlevered property-level operating results and to compare these results to the comparable results of other real estate companies on a consistent basis. The company uses both NOI and Cash NOI to make decisions about resource allocations and to assess the property-level performance of the real estate portfolio. As an indicator of financial performance, neither metric should be considered as an alternative to net income, determined in accordance with GAAP. The company believes that in order to facilitate a clear understanding of the consolidated historical operating results, both metrics should be examined in conjunction with net income as presented in the consolidated financial statements included on the company’s Annual Report on Form 10-K filed with the SEC on March 29, 2022.


 
Total Real Estate Investment is based on aggregate contract purchase price of real estate properties acquired, including acquisition costs and additional capital expenditures incurred since inception, adjusted for cost basis property dispositions over such period. Three Months Ended December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 Same store rental revenue $ 41,731 $ 41,807 $ 41,634 $ 41,468 $ 41,337 Same store rental expense (2,549) (2,707) (2,525) (2,519) (2,172) Same store NOI 39,182 39,100 39,109 38,949 39,165 Non-same store rental revenue 1,875 1,256 2,113 954 565 Non-same store rental expense (643) (317) (750) (695) (376) General and administrative expenses (6,785) (6,348) (6,639) (6,623) (6,721) Depreciation and amortization (17,161) (17,259) (17,615) (18,224) (17,135) Impairment loss on real estate — (10,241) (6,502) (10,423) — Impairment loss on goodwill — — (431) (240) — Gain on real estate disposition 89 — — — 439 Interest and other expense, net (4,480) (11,737) (9,534) (8,764) (9,428) Income from discontinued operations — 377,191 16,305 7,948 8,239 Net income attributable to common stockholders $ 12,077 $ 371,645 $ 16,056 $ 2,882 $ 14,748 The following is a reconciliation of net income attributable to common stockholders, which is the most directly comparable GAAP financial measure, to same store NOI for the following quarterly periods (amounts in thousands): Glossary 25 Page Q4 2021 Same Store Properties are operating properties that were owned and operated for the entirety of all calendar periods being compared and exclude properties under development, one land parcel that formerly contained a healthcare property classified as held for sale and properties classified as discontinued operations. To evaluate properties on a comparable basis, management analyzes metrics of same store properties in order to assess the core operations of the portfolio. By evaluating the net operating income of the same store properties, management is able to monitor the operations of the company's existing properties for comparable periods to measure the performance of the current portfolio and determine the effects of new acquisitions and dispositions on net income. Occupancy is a weighted average calculation of the portfolio’s occupancy based on rentable square feet. Remaining Lease Term is a weighted average calculation of the portfolio’s remaining lease term based on leased square feet. Rent Escalation is a weighted average calculation of the portfolio’s rent escalations based on leased square feet.