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GOOD Gladstone Commercial

Participants
David Gladstone Chairman and CEO
Michael LiCalsi General Counsel and Secretary
Bob Cutlip President
Mike Sodo CFO
Rob Stevenson Janney Montgomery Scott
Barry Oxford D.A. Davidson
Henry Coffey Wedbush Securities
Craig Kucera B Riley FBR
Merrill Ross Boenning & Scattergood
Brandon Travis Ladenburg Thalmann
Call transcript
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Operator

Good day, ladies and gentlemen, and welcome to the Gladstone Commercial Corporation's First Quarter 2019 Earnings Conference Call and Webcast. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to introduce your host for today's conference, Mr. Gladstone. David begin. may you Sir,

David Gladstone

and talk. in were Please with you right. on phone have Thank more this invitation Thank to if a times see by introduction. today. there ever do and D.C. to questions brokers called to and That I time to really the have we and to open people Virginia, We us and you're come lot you, all and for of Lauren. the have us get yesterday a of visit you group Washington, listening Hope wish with at an was so tuning here McLean, office. stop nice you in area, was suburb talk we nice we're the back. a All it's a in us. questions enjoy and good

going Now, the the General legal and make funds, of will administrator also Secretary, announcement matters from regarding is an Gladstone as public to he Gladstone serves some LiCalsi, to Michael? a this and hear brief report. which the concerning of all of Counsel President Michael regulatory Administration,

Michael LiCalsi

the Thanks, our may implied may these Forms statements many the Securities forward-looking in other our based any be our And we results all statements factors results include Act and that different cause file that future Today's we morning. risks under and including XX-K risk forward-looking uncertainties regarding the believe David, by current reasonable. XXXX, are be with documents or to Exchange from on of SEC. performance. forward-looking XXXX, materially including XX-Q, of actual And statements, these factors good Securities expressed to Act plans, those and future report our involve which certain

Web You site, can all on www.gladstonecommercial.com. our these find

operations. Web result any is as performance. there we these no defined and there @gladstonecomps. excluding better today which Investor the Relations or keyword notification again, is depreciation statements, amortization indication once issued so better found Gladstone we except will from Investor other required otherwise, And whether on any FFO, on We'll is events future to of and losses revise the of estate impairment FFO or adjusted new which forward-looking undertake information, assets. discuss funds publicly of of non-GAAP net obligation the real FFO accounting plus or www.sec.gov, is site, a from certain losses which SEC's as discuss page as revenues the law. Web for the gains service. and update that is, by sign real Companies, and results, and also property, our core the estate income can expenses. a comparability sale allows on non-recurring We Those our and found both or our and visit generally results term FFO, of It Facebook, for handle information. up for you be take and XX-K, gladstonecommercial.com, operating call of opportunity our our that Today's on this is on ask we you site, is overview a our Web page be site. also is press simply believe an Twitter and the period-over-period We Relations Form to detailed our of release can more yesterday review of email ask Specifically

Bob the Gladstone Cutlip, Now, President. I'll turn to Commercial's presentation Bob? back over

Bob Cutlip

Good Michael. morning everyone. Thanks,

XX.X%. square expire square a scheduled foot was lease non-core property acquired XXXX, lease a square a we a in whose a foot in Indianapolis, to renewed Chicago in acquired was Georgia. a acquired and in book scheduled Florida, in foot freezer-cooler entered industrial an industrial we tenant expire property in leverage the Florida, end Ocala, sub acquisition the sold a Ohio, office acquired renewed in XX,XXX quarter, a a due XX,XXX in Tifton, first and market, square XX,XXX industrial of roadshow to to Maitland, also foot property foot XXX,XXX the non-deal whose of tenant industrial portfolio two-building and property diligence for the in foot During our square Subsequent square conduced to XX,XXX Milwaukee, quarter, property XXXX, lowered Philadelphia XX,XXX Columbus,

is renew As personnel of results. leverage re-lease operating our equity tenants noted to from per focused resources deficits space, $X.XX this to the fund vacant commenced XXXX beginning in growth $X.XX, high acquire our lowered in now operating good in XX% We benefits significant path to from are assets. on to to team's vacant our XXXX The year-end that enjoy balance and to sheet, throughout invested improve call, XXXX, significantly we're We our occupancy to efforts to share space, improve of earnings period. of that and remained accretive a we FFO XXXX. in news book and our maintained and

also are time to as the cash going a returns returns volume We terms assets, cap we X.X%, to positive fixed of and to annual our position. to year-over-year. because lease are consistently validate XXXX able security, think metrics rate from the approaching was to This note. growth and trajectory shareholders cash the are be some our These at on worthy our rate year seven or equate inflection are X.X%. our the on improve the of accretive these characteristics at were with mortgage debt, interest every improved working benefit GAAP balance should capital and average our point line just straight approaching XX also assets acquired the line investments We the capital lease the million, perspective. XXXX, improve year average seven and The XX-plus ratio ranging under the the rent in to financial leases' From enhancements the payout exceeding payout year-after-year. straight of combination I ratio from each those the leases increase with sheet target annual and period these cash to rate of continue GAAP rate to of $XXX strength growth markets. characteristics which years acquisition escalations; structure average flow We're

back. in asset doubled price, tenant's investment in foot the $X.X The XX-year square and positive momentum requirements the accommodate The operations quarter. are a And rates lease property to the X.X% million, XX,XXX size Philadelphia acquisition going continue generate transaction property respectively. in We be X.X% for is during to in future. Our expansion and the suburb. sales activities industrial acquired a GAAP our can cap the a in management

lease difficulty] acquisition going XX%. $X.X in X% We X.X% GAAP and in also acquired cap and as facility freezer-cooler million, rates can expanded respectively. The also term foot and [technical the unexpired XX,XXX for a be Indianapolis which by square are approximately

for Our respectively. square XX,XXX efforts the feet, two required lease our asset and five are feet management years located Akron, extended beyond New No the these square the York, The of in tenant and renewal for lease team improvements leases tenants for were properties Syracuse, and extensions. sizes expirations are XX,XXX in current continued our Ohio tenant XXXX. and

to holdings $X price capital in strategic with story continued million. quarter the office Our in the X.X% XX,XXX critical realized XXX,XXX gain the was to was recycling end, and proceeds XX-year foot sale The efforts capital Florida. rates a and and foot at Orlando. during the cap property square with the X% IXX Florida million connects from square acquisitions. of is $X.X that our asset This million Subsequent we not was Jacksonville and sales going transaction of were used the Maitland, building first single to respectively. a for two fund The lease GAAP quarter back acquired $XX.X industrial portfolio along Ocala, quarter quarter sale in first sale

are XX,XXX X.X% cap the also in accommodate XXXX portfolio nearly last going entity two and of reported that noted worthy the level that characteristic, $X.X individual and exceeded transactions is our in in however, to last stated of property the X.X% critical were that is property conditions We are lease capital can analytics rates for be for prior report to GAAP volume volume of of tenant million property doubled volume, national XX% Market down in sales compared expansion the also compared The volume, and size comment large contributor report, foot quarter acquired firms seven higher sales a real respectively. XXXX that XXXX needs. down the investment unexpired as XXXX that were sales the think years to term for year for square of first XXXX months industrial in and overall the some are of to major Ohio at XXXX. first a investment research excess Columbus, reports quarter and I the

being rate after sector mortgage as have noticed under disconnect there experience in the seller recently basis even our returning debt is Fed risen Federal interest we and raising and long-term past several by reflect an to addition, the apparent notable the that by the market properties evidenced interest approximately points office Funds has In contract XX with over buyer, months. the with XX slowdown reported rate,

on information XXXX estate. be expectation with considerable available Now with that really to quite is U.S. which to mind, industry. similar still the sales XXXX is The significant the in for sidelines capital for of real that interest in is investment healthy the volume

continue measured that going monitor growth strategy. and our to our market investigate actively Our measured team to promote opportunities accretive is conditions

sales in have As and it and strategy relates we to our listing of increase growth as opportunities noted late. an activity

is approximately is million in letter which candidate stage representing either this Our million are the due or in current of volume the is diligence balance properties, of $XXX of review. XX intent $XX pipeline total acquisition XX industrial and initial under of

underwriting cap year-end cost properties, above and call, properties by predominantly fully trailer non-rated they an to occupied profile increase parks, ample strategy XX,XXX allocation in XXX,XXX warehouse industrial our to we underwrite costs tenant reducing square allocation for the As GAAP our this the focus renewal a capability. we improving the parking intensity X.X%, in and in long-term feet, excuse of in developed is believe industrial GAAP cap benefits is increase average lowering feet markets and of of portfolio it's of acquired rate, can efforts, in tenant, shift operating competition our XX several conscious activity Detroit, were to this management with the which XX% efficiencies. effort improvement us, I our the making XX The releasing clear heated height credit to larger week are over rate me, Ohio, don't Central well we for our located during in first through tenant are Columbus feet April the from locations they with six larger million our property that last strategy mentioned in industrial Indianapolis, of the and show September a this $XX with of of week target have industrial of for are the volume evidence and million we of Philadelphia months our or properties of market properties, size Florida. replacement we believe appropriate proven we $XX trading result and The middle will believe that property to just

maturing continued refinance summary, ATM to our to our in and us loans first growth So, and success, issue leasing position well equity acquisition pursue opportunities. quarter activities program our

for report Now to let's Mike financial turn on a it the over results.

Mike Sodo

operating by for our first quarter Good reviewing morning, I will XXXX. of start the results

as share inclusive I FFO accretive in of the were weighted prudent available referenced company quarter, share of yet stockholders demonstrates performance as portfolio shares, years place per FFO fully and growth completed average are based of XX% per in has Our for performance diluted the both recent the the to the numbers occupancy. $X.XX this maintaining common first well common on core

these of of first quarter quarter as XXXX. for growth In X% compared XXXX first deals, our was rent cash to accretive addition the same-store to

excited beyond. company's de-leveraging continue to we we continuing to XXXX demonstrated in lease prospects expirations, history. core FFO highest fractional addressed $X.XX As no the Bob de-levered shareholders XXXX to to hovered share FFO XXXX number are results as the to rollover. of about increase And to the forward. profitability intend our for going do, balance core no the lease the in sheet for of earnings per With mentioned, grow range and years prior near-term meaningful $X.XX past we in and our

of Our $XX.X operating revenues quarter reflected in million for first to as the compared the $XX.X results period. to operating expenses increase million total total

at now and a take activity Let's look debt structure. capital our

grow and our our as on We over sheet focus we strong leverage. enhance continue to decreasing assets balance

that forward maturing leverage X% debt to lower XX% to new from the nearly our assets reduced levels. believe debt X are away have by accretive our over going acquisitions means through acquisition. We will We to refinancing equity raised to XX.X% past leverage which financing nearly all X% gross target be that and years level we at allocated

there put discussed we going investors, agreement lenders, at level As and this forward. proper believe that leverage with the us will is we analysts,

continue mortgage long-term We make acquisitions. to debt use primarily to

expand high through grow we expect to unsecured disciplined we our we quality increase pool As this alternatives. look Over assets. financing to our property investments, also time, with additional

So, we continue sheet. to manage our balance

over repaid debt the spread, have new long-term with to mortgages X.X% rates $XX of equal the plus past at months million a We month X.XX%. from LIBOR variable XX to interest rate often ranging

caps interest loans. placed have new We rate all variable rate on

often additional added of also properties. in to improve order the to We pool permit put refinanced line total an in provide of balance the more of our into or assets. size our some whether advance to by increasing that our under sheet, have effort the these equity In credit properties flexibility unencumbered unencumbered future placement to our we disposition

this leverage excess on thereby interest interest expense us mortgages, reducing related generally As the has reduce $XXX,XXX and annually. to obtain by an significantly our improved enabled discussed, previously help rates of

Looking profile, and extension million at of in we less XXXX only mortgages options. of are coming Further, maturities XX. our have manageable loan debt with And XXXX maturing $XX loans these million have number $XX of than each a due.

the manage ranging have property are several seeing and improve range. leverage X% liquidity credit, terms the of continued and the to and our including tenants REITs refinances we debt over and on Depending lease, term acquisition loan, high the location, profile to the of maturity all-in and proactively We and amount type, new from time. mid generally factors

our minimize rates being existing to interest and hedged swaps fix debt rate to caps. XX% rising to interest We with or to our exposure of rates continue fixed

We have ATM issuing remained our using common active in our stock program.

$XX.X issuance common cost, During of stock the opportunistically million we first raised quarter net in sales. through

assessment While compared way prices to to keep of as extremely an when we the value relative our raise we as capital. stock of to continue to raise our the view ATM equity, determine in efficient mind common continually we trading as

in of ATM that to incremental our excess we have to The and on As availability today, flexibility We properties $X our operations, to credit. of also and to million fund we million any are and at for our availability we XXXX business believe properties. financial $XX continuing to our and line financial we cash our base have quarterly posted encourage non-upcoming of and we We current you underwriting, current portfolio review on the of significant our good programs, provides remainder quarter. including continue detailed supplement and our FFO core beyond the feel which website, during about increase and continue information as leverage. our to our plan more metrics asset improve execute to high improvements quality

continue to of on our with the strong near-term institutional be and investment engaging portfolio meeting and potential establishing the look investors, very active I new company our only to and forward of of minimal XX% focused focused lease increased high ownership Institutional We as along investor with occupancy Bob not at expirations heavily by like. be base, managers, in are chapter. with XXXX further manageable maintaining our credit analysts our credit next XX% as current also beginning XX. in on and with estate. tenants. With maturities, loan its with We acquisitions estate moves relationships the stock to high real real coverage quality forward strong March banks but of existing lenders, to

turn to it I'll back David. Now,

David Gladstone

All right, you. thank

grow the good very is here report, quarter end it's as report nice the and that dividends Michael point through dollars soon billion to news for will straight very grow Bob April, a I The keep its LiCalsi those And also And and reach think company's main that quarter, good a a to was dividends. company to we in be consistent forward. that assets will from continues well. positioned report very it good assets. to and paying This is us. millstone

the middle doing dividend. with earnings to fine today. continue tenants, We remainder have is of great like the that property also list that a acquiring during diversification. and promising of businesses, protects XXXX The of market the interested potential comes a of many believe your of we We the very company portfolio properties our increase of in quality the the are

us, not team Our good that's as will they've and optimistic and continue annual be June, for rate attractive we done is board that April, investment All to in what acquisitions tenants say $X.XXX the amount be to which for next monthly counts to for distribution per and individuals income. I month in May, and I $X.XX of share but are ours, Bob monthly an that this time. that paying it's will there and the hands like hopefully believe while for in board increase is point per rate know one well-managed together will some This all company excellent in run is yet, their that the quite the can past. voted In at common distribution we're board future, -- April, maintain a and year. an the rents, you the through. in want at talk their an get a our meeting of I'm REIT his Bob we cautious will know and

them yield expansion stock real And lot And REITS return and pressure And analysts record, some answer, that's us to beat terms all can don't strong the real of put able it record. Distribution paid without that XXX depreciated, little him a another like want good we we're I we recession to be and you estate flow we're of yield. return depreciation are that's mainly deduction caused about because the X.XX% we've money now the externally are due the $XX to all. of cutting net high mutual just Wednesday, per on trillions from so could of the into to that time the doesn't around coming our $XX.XX. traded is up yield stock just a those because the to recent want real occupancy second. estate price. income and it's tell a in real most when seem on reach cash see, and industrial capital a strong. you Taxpayers shield stock the a testament And XX% earnings estate that closer at a low, underwriting out. now shelter him distribution. yields, great our taxes year company the hurt we generally And any point, return this. X.X% There's be triple just the The the first let's bit common managed consecutive of want simply remain December went our of and and team, estate to right harm cash you. and depreciation Bob, ending the is distributions, price through email ignore of and on in If capital, know always Stock for is XXst, And that to we'd but at closed at want was level or I of paid tenant earnings emphasis that yield this that for of dollars trading managed. room you externally, funds stock of don't share. to skills last our on for dividends to has same of capital pay

make they We that's the pay sure that looks at tenant can are a where REIT rent, all the begins. to it always first

questions. Lauran, the have they open some them tell our on we you from shareholders. them how team can Now ask questions if

Operator

Stevenson from thank question Janney. our [Operator comes sir, first you. Instructions] Yes, And Rob with

line Your is open.

Rob Stevenson

days? are higher industrial. office earlier you you them, that are to have I mean just these to morning -- thinking industrial it and do relative return you to it Bob, assets. targeting Does historically talked Good has acquisitions about a willing guys still about it how guys. meet had

You to XX% two? guys that over down next or the where office, year guys to of are still expect you sort trend

Bob Cutlip

questions. Good

are Commons, Morgan Salt to which ala from a looking was in I is to we're think themselves, office acquire that we and sure use the Square, Stanley standpoint mixed community in North teams Central amenities, the Lake in acquisition that Columbus nice in like wherever really Lake of be the is and Easton in Mary, close City, the which Orlando.

we that cash pay, plus, look raising cost, flow the because conditions, home to industrial grow I away going really sticky where every industrial not into you are we'll is where standpoint. I between play a developed capital but to maybe from XX-XX, these in a that mission be or point think almost well to comfortable acquisition not e-commerce get is let's to mean, cost I believe long-term it's an three plays a tenant it dividend, versus at and And manufacturer. market or is think office. the and well continue we industrial it's say delivery real we're free office, David a XX-XX read to just split improvement of think mile is at going you going We estate sub-markets, going really split But really to it's when take it XX-XX XX-XX lesser and last improvements forward two I if I will to we office probably going walk critical extremely research as I us the report. from Mike a think at and office. away, you at in and do years look

else I the tenants and manufacturers out ability the on think attack are, last say, our or hit and better -- these credit mile there, middle who head, anyone I nail deliverers. David market let's can therefore, than, who to believe, is the we underwrite are

Rob Stevenson

offer you've type the we it be radar your about over the are depositions maybe sooner really fit it you to then, where thinking is than of of mean, had And Okay. later or mean, how get anything about I I thing? year? of doesn't currently? rid that's thinking or rather remainder guys should there terms want screen you of in what portfolio on the attractive dispositions

Bob Cutlip

an did a we in January. proponent as re-leasing offer am knows, there. involved not team storey cost the from the a of disposition and We the such user, like because I it's office, single attractive of had Well,

when building. property so, thinking square XXX,XXX acquire building And And very, we tenants square although foot nearby that to at weren't elect was were very property, who tenants the to going offered we the was campus exited a foot three the bought exiting a one XX,XXX nice property, and the then and has to of who capital. portfolio, we leave of user so, price, to we and able redeploy a that that

Going with forward, I think that year. Mike identifying can in in we what and on to property, per exit, be number how a dispositions, a and then and emphasize I our a markets, believe, we'll the we'll won't $XX think probably like, but going in be these not somewhere a markets if million non-core getting standpoint list sell to high will as think I from that's the I we're target between exit, acquiring again, coincidentally volume team's rush are big maybe $XX them are year, to it acquiring good the single –- tenants but once be

Rob Stevenson

via these issuing the you are opening priced about rather where point? there you guys Okay. or recently, one forward you're seen about and D marketed the Series I Mike, equity, for offering, know, than mix some And here? preferred ATM, going are comment then preferred at deals thinking about you up in of how thinking balance here here, this a XX% going market, back bounce we've mean, the sheet guys the have

Mike Sodo

preferred to and There set. in to past but bit, the to there has it D want as last I us, our execution to I to morning, mid of compared and sheet, have. six XX a I our in peer XX% Rob, don't of may saw been your question, this Series still I go points strictly to the a couple If preferred is that as We point, quarters. stated the it's above we've Fair being to as do deals as the three wider some XXX. that interest a mean, throughout, points overweighed week print would of work mean, a real here sub-seven I say, only total stated sevens. balance is that with of it trade. XX on for XX% low we

basis So, roughly and and XX half, with and a A as peers our at need the quarters B seven math three points. series did to series the seven save we we a would, being traditional where up

and So, execution just week. optimistic, that the marketplace I'm print we're saw close we It's now. sub-seven in cautiously seeing right last

Rob Stevenson

And just redeemable remind this the B are me, the A and point? at

Mike Sobo

are. They

Rob Stevenson

Okay. appreciate it. Thanks, guys,

Mike Sobo

Thanks, Rob.

David Gladstone

Thank you.

Operator

question from comes next Our D.A. from Barry Davidson. Oxford

Your line is open.

Barry Oxford

guys. thanks Great,

or raising again going didn't the act of you you to up the that forward? without couldn't for equity building want to stock and where you leverage ATM some ATM go your because retreat we need and is, your when stock Just to of Rob's the target plan back look questions, price can price just XXXX at and were given fact to matrix, you're leverage if continue to your on your

Mike Sobo

with it start I'll Barry.

Barry Oxford

Yes.

Mike Sobo

last the a deals XX.XX, able mean, at at of minimum to the over been $XX I active we've source ATM market in couple and of Trading years, north share.

REITs capital environment, there's macro the there, access in or XXXX raise massive is impact and good way good and will otherwise, pretty I their normalized So, to cushion if complete a bit business ATM our about chase, would efficiently trade market in the deals feel what equity tenure that causes I that impact requisite to REIT we slice we plan. capital but our mean, a the underwritten cost of to that mean, a of there bands obviously, off.

Barry Oxford

there of much? them guys one sale. for And word, marketplace, for a you question, last Are great. in you -- so then small not there better small about a when or talk industrial that the Great, great, portfolios just are there lack pipeline, lot out of are

Mike Sobo

up. we're who it's $XX let's from to within right based that portfolio like square one seeing, upside just Barry, that between where at to in I give window starting few where trade this anywhere knows million XXX,XXX million there's more think and And they're a from a $XX-$XX and which going in size say, are think going see because of that the the It's rents. of to chasing now the are that I'll in, because I developed somewhere end sub-markets, five-property on of million is the market ranging opportunity close because $X you these deals to our I We're really XX,XXX We're really point. Most average, to these $XX anywhere feet. is industrial million. to is,

Barry Oxford

right. Right,

that's Okay, so much, from guys. Thanks me. all

Mike Sobo

Thanks, Barry.

Operator

Our Wedbush. Henry from with Coffey next question comes

Your line is open.

Henry Coffey

Yes, morning, everyone. good

Mike Sobo

morning. Good

Henry Coffey

buy back but a two questions. When property the we kind in even you that just really of you a able have or is up challenge? more the into you are the going look your get deal that of the to day queue of closed you like mind maybe don't to you though And the property, it that mix and what's termed ideal

David Gladstone

not scheduled book of assets minus in at equity. have XX% I basis, today's challenge on appreciating -- Henry. XX% Sure, environment, or underwriting debt, XX.X% would amortization gross in normalized about we of equity book $XX annual plus deals to a say million debt we're an

of and tap fact. we ATM, debt XX% environments one programmatically I accelerated in mean, point, minimum that accommodation typical either to we long-term then equity. could or an prior issue a debt, have we our credit prior after the afterwards process, closed into And day the the facility your it's of just execute basis So if get in

Henry Coffey

for institutional sellers parties up or Are to open are looking there REITs cash? your more

David Gladstone

owners, planning and fall, up state up we see for transaction Henry, transaction interested question, the private just are that last primarily These we're our sellers REIT thinking are starting did long-term. to a purposes. developers more in first REIT good

just it course, in think transaction us expand So I over continue a going of that to months. costly increase there's to be several next and and I less the think that's will an for opportunity,

Henry Coffey

a of million looks million-$XX $XX read it handle by fair like properties way good you is then got year And that or… end, your on a pipeline additional to

David Gladstone

No, I it's think higher than to that. going be

achievable letter And has diligence indicated million the bottom we and surprised an XXX closed intent somewhere with I of unless goal million as As million the very don't due last cost -- the with $XX now of think over is $XXX in at $XX weighted to said, And pipeline. credit long the going our around the with Right velocity of this months, our market. out I a terms, stage, I falls see those been six dropping. $XXX issue, million be so a year. markets in I to margin least about would mean, WACC that XXX capital, with we've our our got tenants. we're points I've average near as basis always buy I to or David

Henry Coffey

Excellent, thank you.

David Gladstone

Henry. Thanks,

Operator

Our next question…

David Gladstone

questions… there Are

Operator

Yes.

B comes Our with FBR. Craig next from question Kucera Riley

Your line is open.

Craig Kucera

guys. morning, good Hi,

David Gladstone

Good morning.

Craig Kucera

color or saw building that on Good you lease morning. trying termination quarter. potentially some you Can you was a asset? release had anticipate where sell us give to it do this and I that

David Gladstone

sold. That was tenant leave the that that property to single-storey also going which we office was

only termination, yes. So that's the

Craig Kucera

the Columbus you Got expand had need it. got And your double to the acquisition. potential it, mentioned in the to on that space kind that you eventually of at tenant indicated that order? commentary the Has might they

David Gladstone

XXXX I may, an I they going facility at the Vance, and expanded have if it mean the as relationship saying have with it land so our what expand we properties for Of team to to us land the I said extend to it's turned their the in going deal we right end are look situation, really continue additional with Mercedes to it investment of is Benz am to of to in their extra land, I three to the the that leader assembly like expansion as those. have to and expand can long-term we to the we do one long-term they three we because it need part land the right us has really Copper about be plant, out there this but and really am in that indicated came doubling "Yup, that we one and I has there at to buy it dug-on Lear plant only lease, to building some expansion like down mentioned the Mercedes that," XXXX developer, tenants expand in land, now But we capabilities, that already it David opportunity now and the done finding growth the of excited well that by good and are relationship, deal, has out, XX,XXX. happened say, turns our Buzz paid if Benz having ability Alabama they and free for long-term they when have we gives in bought leases back

we So to continue at going look are to those of type acquisitions.

Craig Kucera

what me, are but is or geared that Got far heavily as assets it. in towards for mean our composition, are the industrial the are I pipeline they LOI under currently they markets? appreciate on contract your more one the target as and color And

David Gladstone

of the one Atlanta my that port tenant probably is Atlanta, has exporting of in the positive with will markets from we you Columbus so with and equidistant in this is about it tell port Jacksonville boy to are the Tifton and other of Brunswick of is six that is When our closed opportunities depth industrial, every channel of Chicago, XX was Jacksonville one Ohio that all the only we weeks But the in one are original career, in target of product lowering of its for south I out part which that long think and fact an our port Tifton, industrial. aspect being and they quarter Tifton are there. port deal Jacksonville, see but think all long David along the area. I going I Georgia is Georgia They more not me the and of a IXX talked of

Craig Kucera

typical us some are for assets of rate what kind And the there? are it. color under give initial terms Got that LOI cap

David Gladstone

going that's Xs the right are Xs anywhere from ranging low high now. what the seeing are in, to They we

the before split XXX let's industrial am our I a is XX about basis higher think XX brought office to of points split I cap and Rob between about rates, up so say it basis points at industrial, have in. of at are to anywhere on to mid Xs the X.XX high the deals X.XX Xs from now going low to kind but am the a we that office I the the on

Craig Kucera

Got it, all right, thank you.

David Gladstone

Thanks.

Operator

from with Ross Our Merrill next question Boenning. comes

Your line open. is

Merrill Ross

since see some declined property? amount in particularly lease of that's can renewals, your in you. has expirations talk renewals biggest you Thank I success GM the with but the about that XXXX

David Gladstone

specifics now frankly because talk indicated course as number get as expire will all we and closing into to team XX question now about timeframe years I program out XXXX five we the proposals two -- quite to with of of had because it the I already would scheduled think of right the in we with about and to going XXXX I we talking attention are like them lot out, you in the won't our people Right brought them. a was No, my have negotiations and others already. leases of I is know, in and to we've next have when lot of happen we talk what's to GM two think here. with a on plants, done is discussions start begun year GM I GM about

lot building $X market his really property for they their collected effort for to or are and leading is four to actually EJ and TI their property to than to rates finding is to Copper began staff a current center now but the let's good and it's we transparency have are renew recently you property $XX are the $X. say interested plants of by if go XX what in Buzz TI Our nominal XXX to who building, back of then innovations fire. at paying is our partner in that one $X compared GM re-lease they have rental and to $XX by Austin The that cut and least on intel higher in building $X at increased they that their the staff when just cut people what our

X.X% XXXX. return rate now our extremely cap in going property since good that bought in is bought so of we we right So

the I am owners property particularly are pretty who counter are go, our really Buzz's that colleagues limited saying with and have brokers parts they of very So encouraged even to there places size.

let's So am and XX months expires their we are in lease that going say their before something lease of I'm least to expiration done, XXXX. hopeful get August I at encouraged

Merrill Ross

interesting, keep It one. Great. that on very sounds

David Gladstone

Thank you.

Operator

John [Operator next from Thalmann. our Massocca Instructions] Ladenburg question comes with

Your line is open.

Brandon Travis

you. for two morning. John, for Good is Travis on questions This Brandon

you and then First give on portfolio color expect can acquisitions the wise can for on general how you some additional to year? what this Orlando acquisition color is any us timing sourced give the

David Gladstone

a on pretty about markets going most party our in of which say cases You typical, because is was I I two to get where the am our it's mean we are to the need through are go one building even listen XX% probably broker leaseback product sourced third able better sale and XX% direct but of to to I of price. It contacts to industrial. to talking go relationship evolved people and

Flick broker one is region. this [indiscernible] who So, with with relationship and runs Southeast Brandon our

Mike Sodo

bond about modeling probably Brandon piece question pro doing million the from and second million perspective having would just say million throughout $XX a $XXX deals about to rata year. And to the the be the guiding of your for of it in year-to-date remaining would $XX I

David Gladstone

say would rata, pro yes. I Yes,

Brandon Travis

you. Thank good. Okay,

David Gladstone

you. Thank

Operator

am turn back Gladstone not to remarks. to closing like would any this I the you. for Thank I any call showing further questions Mr. now at time.

David Gladstone

off and us talk about questions, us questions thank you right, get you we you let nice list had it a of All and for track appreciate when business. in, and ask calling the us really

So XX for in That's will anyway, calling. of days. about Thank end this see we you the call.

Operator

you participating a today's program, wonderful does have disconnect. and thank conference. conclude This Ladies may in today's all and gentlemen, day. for you Everyone