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GOOD Gladstone Commercial

Participants
David Gladstone Chief Executive Officer
Michael LiCalsi General Counsel and Secretary
Bob Cutlip President
Mike Sodo Chief Financial Officer
Gaurav Mehta National Securities
Rob Stevenson Janney
Barry Oxford D.A. Davidson
Henry Coffey Wedbush
John Massocca Ladenburg Thalmann
Call transcript
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Operator

Ladies and gentlemen, thank you for standing by and welcome to the Gladstone Commercial Corporation’s First Quarter Earnings Ended March 31, 2020 Earnings Call and Web Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions]

to conference like speaker to now Mr. today would hand over the your I Gladstone. David you. Thank ahead. go Please

David Gladstone

designated Thank you, is once that have we here you working in we Jimmy were in people for enjoy seems with for all thanks do more phone. our people calling are of an we from the fine. and All got you to have people be doing healthy. on to business, quarter. some in. I the in time it a here This home this David the some office and nice Gladstone do we everything so introduction as essential We’ve wish going office and we and here just than working

turn matters point give over and call is He this LiCalsi, he and I’ll regulatory General to the is Michael? going at and Michael concerning then, our legal to Counsel Secretary. in report. a it you So,

Michael LiCalsi

Today's we forward-looking Thanks of good may XXXX regarding reasonable. current are including Securities risks based Exchange uncertainties forward-looking involve and statements Act be which Securities on certain our David of those statements morning. plans under XXXX performance. Act the believe that These to and and report future our include

all And other including SEC. the and future risk materially our we XX-K, factors results in many factors we Forms these actual that any XX-Q, statements, may that be different file expressed by from cause results to forward-looking or our documents implied with include

website www.sec.gov. which You the Relations specifically or it’s is can gladstonecommercial.com on is SEC's Investor website page our on the on find these which

any future law. whether a no otherwise as events, obligation result to of by revise of forward-looking these statements information, undertake as required And or except new publicly update we or

the depreciation amortization non-GAAP Today, we from estate is income, of property, gains plus assets. and losses excluding is will the FFO, from term and or a funds losses of any which impairment sale real on as FFO defined accounting net estate operations. discuss real

also for period-over-period FFO, of comparability adjusted FFO these comparability expenses. and FFO generally and our adjusted other performance. discuss indication certain revenue a believe results as our operating and core better We'll allow better are we of for non-recurring metrics which are And

to sign everyone again for notification our service our the visit website ask once opportunity gladstonecommercial.com, We to up take there. please e-mail

The can on You is also @GladstoneComps. Twitter is Gladstone find our us Companies. there Facebook. And The keyword handle

find Investor is for issued press simply our call XX-Q results Relations we overview Form release information. that Today's an more of our you yesterday of page our the so them and on you can website. detailed ask Again, review

I'll that, to Gladstone With hand the Cutlip. baton Commercial's back Bob President,

Bob Cutlip

Thanks Michael. Good morning everyone.

a for extend for a the tenant in Springfield square industrial North the extended Georgia; office and foot in square Indianapolis; Colorado; XXX,XXX we sold lease in XXX,XXX square portfolio acquired XX,XXX Missouri; Charlotte; in Delaware, square Denver Houston, Ohio acquired Carolina. a in the XX,XXX amendment and non-core executed lease in foot square foot three-building square a property industrial XXX,XXX quarter, foot a extended lease in tenant a foot industrial foot first Louis, property a acquired St. tenant Chatsworth, XX,XXX to During building

of XX, valuation will noted and potentially is was in our that has levels, allocation, in end, expenditure As over XX% property increased strategy as industrial increase our fourth capital To investment X, improve quarter and reduce March XX% portfolio's we an our allocation time. XXXX. efficiencies, our to emphasizing January which on industrial operating on believe result XXXX call, improved our

of to overweight and permitting, our evidence intent market the of developed course, this XXXX, our of were XXXX investment providing industrial is through to continue in January conditions From all March volume was industrial properties $XXX submarkets which our million of commitment targeted further locations. acquisitions,

be will candidates and square Our from acquisition feet. in focus to has size ranging been XXX,XXX XX,XXX primary

cross-dock During the a a term rate an XXX,XXX five XX. a transactions lease lease GAAP equating $XX.X our for Charlotte GAAP acquired for and $X.X all years generate to expiration average million Chatsworth, operations. and quarter, $XX.X of property in foot square to of of momentum remaining with industrial rate XX, million X.X%. facility of of with a for and cap of continue rate XX,XXX X.X%; investment three-building and Houston, square January cap a Indianapolis foot GAAP asset We The portfolio activities investment approximately a St. properties, Georgia square XXXX cap and a date XXX,XXX included volume. positive million in XXXX for management $XX Louis, in foot date our August with X million X.X%; in in lease expiration

an quarter with we continue is wish investment property road to The the the at our increase Port Georgia, in markets the presence to industrial acquire which XX-year are is United desire to square allocation, locations with consistent these at States. Indianapolis our terminal the half first Inland our Northwest I and our Class The in eastern property and rail increase also to properties transaction coincides concentration. sale Chatsworth lease to volume strategy our back location in foot industrial adds XX,XXX three-building of

deliver to same Our asset our management improving operations. team on continues store

office Springfield, improvement foot. tenant square The was for extended team XX,XXX our May package square tenant the through per $X of XXXX. Central South foot Our Missouri lease

West square XXXX. team the Mountain of through Our foot tenant for December lease Denver extended XXX,XXX office our

tenant term on was improvement to weighted increase And $XX our average for per improvement February mid-west the our lease Delaware, square The industrial foot lease foot. These XX,XXX square extended team allowance serve and through required. efforts our entire portfolio. is the tenant Ohio combined tenant allowance XXXX no

these our three appropriate. equipment lower implement to cost for no savings is We going the operational energy office states, energy improvements energy at upgrade locations Indiana. Ohio Gladstone, other implementing in These projects standpoint, lower at as building And in and tenants. from consumption capital team savings forward an by and required expenditures our plan programs operating locations

emphasis the COVID-XX increased employees. for The required of on a has arrangement The company portfolio management. has virus implemented successfully work-from-home onset

emphasis However, quarterly financial our established is has always strategy and active tenant program to ties] With we performance results. this recent tenants on an credit, continues with positive their have discuss [strong each them. our tenant engagement and engaged of delivering

increased connections we this tenants. with have our During our appropriately pandemic,

Some interesting our favorable characteristics and of tenant update included were business profile releases. press our on

just tenant oil First, [XX%] or annual industries revenue; X% and of and revenue on of X.X% airline and of the is average company contribute tenants from comprise revenue. hospitality, less gas,

of to request rent from have respective deferral and notified and completed. the by for have immediately will been challenges as a The our which expect we there will virus tenants we them be as arising tenants, us the we There result of prompted all address with tenant. connect are we

the rent to X abatement period to Our strategy rent XX offer the over to if to month month possible and all of three-month deferral not one-month a deferral period. a repayment to is deferred to at rent limit require

extensions We increases attempt include to in rate will also and lease rental the agreements.

agreement business Now no will have unique doubt there is each terms. that

highlights collection are to key to increase as as noteworthy teams core the follows. maintain the Specific return level, performance as and objectives cash or However, share per soon through FFO our possible. are to April rent proper of flow previous

payback scheduled been The All and cash-based tenants rent has XX% granted paid. approximately company ranged These months deferrals rent, schedule the X based months representing ranges the months. continue X from was rent as three X.X in partial rent income. to rental monthly March paid total tenants approximately X of April to to from and of deferrals April from period to X% pay

advantage of concessions results them we those XXXX, lease conversations to requesting evolve. tenants through team's will I the positive outcomes report call wanted of thoughts they and beginning available we're be in the are number programs short-term of our activities. their hopeful continue taking We many applications. to the and Anticipating to conversation And federal a summarize of with on interested tenants are in other the as of current on in expirations that the

on XXXX At office a tenant Minneapolis. a XX, vacated foot XX,XXX building Minnesota, suburb square multi-storey March Fridley, lease of a in expiration

commenced have occupancy a April that for X. of term XX-year building leased with lease XX% We that on

of prospects the have vacant the space. two We foot XX,XXX also square balance for

signature XX% office out one year. for industrial balance by a square tenant tenant occupies square foot Raleigh, amendments the a XX,XXX of term The lease The improvements North under building. industrial our have lease. lease extended long adjacent two with tenant single of of We be will a for foot industrial XXX,XXX for and required building lease building; a properties: XXX% extensions. is who Carolina No for occupied the and lease are years five the office

at vacate our to expected Texas property end is Austin, GM of quarter, August. the last noted As

one-third from of entire active building resulted of property building. prospects for offerings Our each with with local interesting two for triple basis. two additional square property and of of the the the It’s the approximately in our the prospects has note marketing $XX assistance foot in the commerce the in GAAP very per low-to-mid submarket net per to at space favorably a on the compares rent that $XX.XX square current foot chamber

the COVID-XX for by in balance quarter hopeful with and the particularly This effects positive of estimating our industry. of outcomes. the worthy the numbers. in may tenants we adverse double-digit onset of XXXX, that of conditions from the Economic for the virus. quarter economic Market will are slowdown drop of And activity GDP comment, second impact first expiring certainly active forecasters conversations are are are

XXXX commercial stated is that the XXXX, to analytics for U.S. buyers the saw average capital pool From research Real XXX national properties on firm and reduced month. second X,XXX on noted quarter. certainly is during each the quarter. unique have This quarter first will buyer effect market enter volume the a at during we buyers the and dampening as first estimated short-term almost March. investment sales This number in shrinking

rates to as below expand of office could volumes professionals with the in much the in everyone. XXXX. in which to In indicate import expecting are long-term the be have sales quarter. for XXXX volumes and same import addition, be that half the investment they of properties expecting levels as for a positive fourth They the [East for reported industrial coast and appear expanding ports] period for are third number first to cap be that XX% markets, conversation

market monitor adjust it to will and And to moderated listings relates conditions continue primarily will driven the have opportunities, of virus. our accordingly. growth We as the sales strategy effects the investment by evolving

acquisition properties, are XX volume of representing Our industrial. approximately candidates in current million of $XXX XX pipeline which

a in position, properties currently states of more soon will Because a to of the conditions opening some the many stay-at-home these move that with soon. in states whole but that we whole believe of positive number position are up directives

in acquisition the is engaged team and will arise we and we pursue. actively do believe Our markets staying as will can opportunities

in stability. across all contributing to may conclude, one in are as success summary, our entire disciplines our So our overall team

activities our positions common opportunities. issued and us quarter mortgages, strong refinanced maturing to through first success, and collectively equity leasing program, reflected pursue Our well acquisition results ATM growth

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

Mike Sodo

reviewing XXXX. morning. by quarter All Good share shares. the on FFO and fully numbers per per weighted that common core performance as I common of first years, available accretive performance the results I’ll stockholders based share $X.XX start for our FFO and as to the average diluted are in operating were the respectively. $X.XX growth in-place. both completed company of well has prudent demonstrates yet recent This the portfolio reference

X% In same-store deals, basis. our continues these cash annualized on the to accretive addition at rent to grow

years With of both of the part the as at for portfolio excited allocation to early us, we’re the well as sheet the and of improving behind of and shareholders, the about grow profitability end the portfolio. of acquisitions including XXXX balance industrial prospects the increasing our number XXXX substantial deleveraging

our ours value through laid-out, the intent every actively maximize pandemic. team COVID-XX shareholder to As beyond engaged Bob the and of is tenant to with

the We’re with will team's which we times to pleased April, performance are these through but continue and navigate portfolio's together. unchartered

increase the total an total million XX.X to revenues million Our first period. expense reflect in quarter to operating for as operating XX.X compared results of

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

to gross debt acquisitions over past XX% assets years to at XX% through lower We nearly financing debt five levels. refinancing and maturing have by reduced new our the leverage

X% means our all go We toward that equity acquisitions. leverage level, away from target which nearly we raised believe to are accretive that X% will

financing debt mortgage unsecured our pool expand grow long-term alternatives. investments, Over look make we We to through as will this continue we we'll time, expect also to additional high-quality use acquisitions to our primarily disciplined increase assets. with property

to new we often XX X.XX%. rates our sheet, to continue equal repaid LIBOR manage mortgages X.X% past plus the with interest $XX rate one-month to spread ranging variable debt a the of we’ve balance As months at over long-term million from

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

future to some an We unencumbered these in of by effort credit line debt of also increasing pool provide our whether our under in or to properties added advance in placement, the disposition of total flexibility of unencumbered the more permanent assets. our size

XXXX only manageable maturities due coming are our million very and A have with these respectively. extension $XX Looking of loan million loans $X number and options. XXXX at debt profile,

improve profile We maturity have liquidity and and our continued to proactively manage over time.

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

extremely issuance $XX the been first in raised at cost stock our program our of during active also We’ve share net sales ATM This investor to common the to well and of extremely normalized and average $XX.XX. net economic in the million price an demand cost COVID-XX. quarter common raising and opportunistically outbreak using stock stock times we of demonstrates was means for meaningful issuing of our timed efficient extremely capital prior

will In of mid-March. and clearly quarter supported core activity equity it second and including we’ve $XX our million made nearly X This in it note of is on All Georgia. acquisition acquisitions raised November nearly first fourth the and exist total, rates quarter quarter March FFO resulted one-time between the first equity in drag of was the is ATM a not $XXX fully million as and which drag all $XXX,XXX forward. acquisitions, supported, the January, in quarter as

to did Also proceeds market using more professional prosperity previously the well $XXX,XXX as Series totaling call, A on on bank dividend as going we further million the E forward We prospects have The the savings redeeming existing of as Series transactions to speak excess to our to believe from mentioned $XX perpetual achieved, of efficient redeem our for outstanding October these to and incremental enhancements capital equates that growth company X.XXX% Series a continue securities sheet balance capital. been preferreds. year. last issue long-term and successfully and backing access our B an with preferred

$XX.X programs with a our line fund term, that and have and near properties. million ATM today, underwriting, our under any operations strong incremental to to access properties and known believe we availability with performance improvements at in million our have upcoming our we of flexibility significant $X of As of current we our credit in cash of our credit availability we our are and long portfolio

to we continue our plan our review asset feel and posted our our business also to increase provides financial you base information to detailed and improve quarter. We encourage good portfolio, quarterly which continue the high-quality about supplement financial We website, portfolio more existing continuing on manage our execute for our methods. as to

strong focused real We’re on and estate. credit maintaining our high occupancy with

Institutional moves Bob to investors, ownership as with and of company meeting look its and has over establishing time portfolio March managers, active very our investment to stock We continue XX% coverage current relationships like. as analysts, I the next of and be banks in the forward new increased to XX. chapter. forward potential to

dividend and that leaving while is the as we dividend, also stock are first common was have the quarter second we quarter. small the announced our it Regarding the did we increase in increase in

in have suspended touched or the IPO our not XXXX. since dividend We

at distribution stock dividend currently yield much the The is yesterday lower REITs $XX.XX. at Many X.X%. are closed stocks trading yields. on Our

to Now, I’ll David. turn the back program

David Gladstone

you, a Mike. good report LiCalsi Bob report Thank and was and good – Okay. you Michael to. did It

due properties the a quarter that first had think work quarter have regulations tenants rents are in out Heard we and is this I and good ending rents well. hard all lot XX% the team We as of would think be five of at the collected April in. acquired been that all I the and the today, with much quarter credit the after industrial were XX not hurt that’s quarter on nice good all new by a virus a there. government June

We’re few rental negotiated short-term deferrals. got a

will those we commercial growing and are strength a will company The executed in leasing we’ve good several assets they which initiatives because think forward I think on pace. collect I team good be real at estate the going us. the really is for

quarter this the a is lot job company did a managing we As the you of owns. properties that ending. saw, The team in great just doing

they’re and Our know acquisitions team Acquisition excellent investments. seeking pursue they properties tenants; make strong has strong credit the team great of that some very on professionals tenants [indiscernible] reviewing. list I to continue is

are managers managing. actively asset Our

managers We’re buying developing an seems environment like different a frankly excellent it’s and a now, good this group but of just asset quite opportunity.

six idea that at looking we're we’ll and this in be back or see everything So, we with months that that. all the looking we’ve done wish

restrictions these our tenants little So, I we're to businesses tenants or challenged our do are is us. have times our paying our a and before, government bit job good market just many seen with we buildings, of it, never we will their team but have, the committing think deferred but statements making the and now. rents of The new middle to the pay for virus If first-class are our that like related that they’re us. been they

So, can on I'm come there so going you would to people this. out stop get to listening questions from here and the some and Jimmy, moderate we

Operator

Gaurav Our comes Mehta Certainly. first [Operator from National Securities. with Instructions] question

is line Your now open.

Gaurav Mehta

my for morning. good Yes, taking Thanks question.

First question what hoping seeing tenants? break hearing or was your office you if versus tenants, from down on could your I you're industrial

Bob Cutlip

We’re request the that side. very request, very, more from think, that, have our what mean some would interesting I companies call also receipt of comments of opportunistic tenants. but we’re who are the from valid – we’re strong office receiving the are receiving I needing requests from more is requests I requests middle-market What’s and been

up going know nominal don’t requests Gaurav, point. have if to with but as that to letter, sent more we’re letter cash, dollar but, in billion address and this we course they’ve One company going have over I XX of at not $X this to that’s this received told office really going landlords, of us formal multi-billion them received change a to we those, compared forward, industrial. had from

Gaurav Mehta

Okay.

David Gladstone

Another Gaurav? question,

Gaurav Mehta

No, the building, think you’re to that that follow-up talking last that’s to? for I prospects – – you you had that are earnings having were prospects you these talked are on guys I those GM, new about talking on same the about that the call? multiple Or talked

Bob Cutlip

two us. There’s quite same and – that them They’ve are of, them have the new. say, were did tenants let’s of two on of couple gone interested. smaller are a We

Governor up California, One up. investment pick activity in and they’re of expect Abbott with In soon, talking in see one does they the with Austin broker, is open is the larger and our chamber other here the well if known name. to tenants the state sales

Gaurav Mehta

That’s I all you. thank Okay, had.

David Gladstone

next question? Okay,

Operator

you. Thank

Our question next Janney. Stevenson Rob comes from with

Your is line open. now

Rob Stevenson

you morning, something not are or Bob, tenants you’ve forward? the any Good guys. done additional going getting rate else exchange or only that the from any for the but term in far, thus couple as deferrals

Bob Cutlip

We have those wanted required abatement with have extensions. who have rent been people we negotiations in and for

the at are as in any time, if share. we rent Fortunately, will withdrawn. to possible. so an extension is really be if per maintain extensions to that FFO doing we maintain core What back and soon the per prefer was can tenants the interested of Many get not cash but as request we share abatement there FFO our fact, is this will requested, in the

had may loved I have extensions. do to

Rob. so that six you repaying that is us asked to know but, it case, we've we’ll goes We and and done three they’re know, – just within each far, you have months nine how forward, see on acceptable to the with they’re

Rob Stevenson

months? an to Is nine that on six there charge interest

Bob Cutlip

No.

Rob Stevenson

after know, or the cash at next Okay. of the month the of a numbers are into state to balance capacity, quarter and today, liquidity you acquisitions when likely two the sheet U.S. willing look deploy Mike, how given the and much you debt the that in guys you economy? what’s

Mike Sodo

we liquidity, as on respect of revolver $XX.X availability. Sure. I to have mentioned, have million Rob, may with our

[$X in we million to million $X We we’re Today, cash. availability. also $X carry of of of excess million] typically so $XX million have

back. As cash we about obligations think specific to the

As I did we may mentioned, repay subsequent mortgage have quarter-end. to

cover so had So mortgages certainly coming the $X due in we only of that. can only – million we XXXX,

that’s cost on deploying subject capital potential into acquisitions, largely to of As capital.

the capital you with pockets There stocks roughly [indiscernible] at [indiscernible] free, of trading still that are with but debt deals we generally Today, that’s challenging. know, XX% as are of our are doing north LTV.

been the the get and a So, second is we’ve you guiding personal professional know, optimism we as of basis, that to well normalized more what stock environment as with back from market half much quarter basis. to with

investment you – know for we time So, what daily really from makes we basis. perspective on strategy correct for real [indiscernible] a us an sense

Rob Stevenson

covenant was the the then, helpful. supplemental And in very Okay. page

to So, the XX one that payout, a on covenant the looks be tightest dividend trailing is months measurement?

Mike Sodo

[indiscernible] back know, the are months know, XX below of QX have we at benefit quarters of XX, the look our six correct. been That’s and you couple XX%, the will last of QX, as good. you so, activity operations slightly we of south but, Trailing have

down continue over [dial number that’s that] to We time.

Rob Stevenson

And needed to that with you a get conversations how something quarter in a or if around way challenging it temporary lender, was know, or two? it that – for your the like is

Mike Sodo

Sure.

the supportive modification, very can’t time our to be know times challenging I if they’re buyers ever at any needed do lot you a lending promise have four discussions, group we April way from of combat lending to etcetera. you six are office in We of to last I hell six that retail now group as back have you of highly leverage are rear refinance, I but will mind are hospitality a us and made was avoid have performing continue through banks think hand-to-hand view fantastic a – know, year, know, entire level very doing of been ever higher future, the we just the those supportive look I we to went that for in that would to to say top of fortunate so and more [indiscernible]. past a talking say but but type the not portfolio, in industrial any with, fair, I up be as

Rob Stevenson

anything have from one point? Series then, And the at F Okay. this you me, under issued guys last

Bob Cutlip

to-date. Not

not say, traded, non-traded. have potentially although issue – would I significant as I long-term overweight well we on – preferred as preferreds have desire massively think from do will Rob, a we to perspective,

comps think you we yield common [asset You to-date. incremental yield we Series know, of today, did but it, for not there if know, was the F did] the capital, do so [indiscernible] you have [X.X%], need [X.X%], as about could

Rob Stevenson

Okay, thanks Appreciate guy. it.

David Gladstone

Okay, question? next

Operator

Thank you.

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

is line now Your open.

Barry Oxford

thanks Great, guys.

the payout you Rob's know, Just high you’re a on have you and a regarding question yield you if ratio you at to dividend, have up covenants build pushing high, against know, especially and X%, marketplace, know, getting arguably, in an if to you make maybe that that full comment great? you’re credit and the why you too to would be not not want dividend, adjustment David,

David Gladstone

We don’t cut lot stock the I a dividend. I and own dividend. of my like

Mike Sodo

see, tenure as getting to covenant my package X.X-year are well as fair, period. have Barry, tighter not a than credit we any the been be during marketplace, specific in really we

that So, performing. highly numbers not reflect been upon performance the based impacted been because anything again these do portfolio has adversely we’ve

compared to we are never that when future, I we significant think, we trading underneath will again, at You see environment, be [net in in will discount peer a the the appreciate the out aspirations continue people we even need] from and can recovery all predict know get price. that normalized a but a share to as set relatively this pandemic

are you where we know, today, few and leave is. matter weeks just we Board meetings It concur performance. the had So, was with dividend as ago pleased of the to a

heard well. You’ve David’s as comments

strategically out that mind need of that out understanding there So, of or are top is people other not cuts, there to making that are us.

Bob Cutlip

have economy this And same, I think how you go have at the don't have in with point conversations my on the company some evolved long falls you through since Tier said in in to do with lower and dividend. of add other and years. have we then you’ll Bob, who the apart joined their they comment me and they you they’re to colleagues you’ll if with banks your a people me, said, telling XXXX the come lower know, wise way. but guys know, we You have to as been another for it’s done, completely dividend the seen based that, They X you history what to

said, meeting, position. next if would great very, You're why in holding a we're couple last said very David reconfirmed, years as look just dividend. that? and has Board good, ahead The the you you the that's Mike has So, at do why we

Barry Oxford

Right. acquisitions, of you Bob, cap No, to little XX bit. I can up – basis in points or is feel basis you XX mentioned points like more or just know have the you switching are a that you backed Do it appreciate a bit rate, know, range? – all gears you that. little kind

Bob Cutlip

we're in What is is salespeople point predominantly [XX to point investment hearing basis that from basis anywhere basis anywhere industrial XX is maybe to offices and point] [XX that and XX basis point], from from more don't to the Midwest – as compared so Southern the don't expansions some of acquisition, know West the the the West not – actively you those of pursuing markets. And course, apply they to we're Coast Coast.

Barry Oxford

Got you. [indiscernible]. it, guys. Thanks Appreciate

Bob Cutlip

Barry. Thanks

Barry Oxford

Yes.

David Gladstone

please? question next Okay,

Operator

you. Thank

Henry next with Wedbush. question Our Coffey from comes

line is open. now Your

Henry Coffey

and everyone taking my question. you thank morning, Yes. for Good

there inside are the the bright portfolio areas to other You where and opposed what spots your there dark stay-at-home because know this the know of shop-at-home You are as and spots equation? of like supply going your may big impairment the are obviously, be that positive here? to clients where chain, and potential shortening seeing of moves? portfolio of permanent Other some areas, suffer we're some

Bob Cutlip

that would be I percentage, we some shut You I small centers people I they with probably work. that and is can't know, the but the those states you are think now. most they're know, retail, where concerned are right know and – you have down ones very in – daycare which small, mean,

it I a would that. to think think had be I dark if spot, So, about

forward. that to that to a think goes see is I got great dark, got where We not maybe watch but really spot we've industry. the automotive

as of tenants the one PPE connected doing to equipment industry is our is Fortunately, auto the well.

and three not industry to of stable, And coming it so, auto that's we've there. watch I are would got but back, two tenants extends on the months closely for the to next two be that they're very encouraging because then if the very large concerned and

huge On assets; square time. a are the have companies but in market they’re industrial business, sounds approach – bright under XXX,XXX side on assets crazy, spot, I think, the the our you primarily that long really They're been to know, feet. business this not middle it

all do shifting the programmed. because concerns there down some that taking with to good But the on-shoring not TEU the for bright now and the as to do it's believe in see some port Vietnam the it's and although future expansion larger I've inland in just is think of XX,XXX. everyone. starting call the interested and that X cautiously the we place and deepening between for Singapore, I are slowed that are and bright indicated some the going the program Those going today, a with and to these with the East part we're not I'm today, have optimistic to going us of that of to China very ability ports is to manufacturing, the tomorrow, the but indicated I Class the is a spot past, happen now of and up pick more not spot in the on India of manufacturing railroads from ships Coast work ports up of things in most It's we be for clients

to There right sale now. at, large looking leaseback kind properties Inland these railroads with they’re a we're They're Port lining of and that facilities. We to to size. opportunities, are locations silver X Class be acquire ports going that going that at – in partner that's size; the going be our load] but not Henry, to think these there's [trans to be to able I'm going be are

Henry Coffey

you portfolio Is distribution? know, shop-at-home benefiting in there your who's all anyone this, from –

David Gladstone

to warehouses that Yes, think but stuff – last if wherever side in going. store got as mixed We've people some goes and Henry, grocery probably people bag, it's a some go it's are where the today, retail of on back our the as are our it’s store that. hardware that it's comes mile out the then or well doing and you I independent, that's to – are an in group the it's

shop, why we for do the when an what So where you three… you – or we going to are have, or from back so – – two all and retail doing underwriting underwriting, three going an dollars you have we whether way you're do know come the they're to come, a trace two have, you

Bob Cutlip

Walgreens.

David Gladstone

that they're not the but is coming I in. going again, as have, I that, is come daycare a of course, no up, they're they've work one back mean together couple closed Bob has of state are fill when daycares temporary reasons and because a things closed problem on. will selling. Walgreens centers, the they're mentioned, And because and guess tired closed, got know we of [cranking] having they're a of they big revenue families along, but And getting so is living of my most these up no exactly don't that are but the guarantee are little them,

kind stuff we know, weeks then this and to up. do start eight You of or of weeks open six

don't just come I from, coming that an can't pretty we so the always future looking strength. can do bullish about we enough back those but think underwriting, getting quick. it I and neither has money people it. will for is are some if predict do the We're where when anybody, question

in shape difficult period the think that have we're through be pretty we're and think now gone We'll next and good. you through that going we'll see time I I quarter to most is it's the you, will know, period reopening and tell. So, good going

Henry Coffey

thank has history. your being a comments it’s with and nice for Well company you your that

David Gladstone

we've dividend cut no there's with our numbers to and in would Well, we've our day shareholders dividend forever the stronger a stay in for want a temporary it around paid desire make our if financial We look been dividends. them pay a even while to way. and and

question? Next

Operator

Thalmann. next Our Massocca Ladenburg from John question with comes

Your line now is open.

John Massocca

Good morning.

David Gladstone

John. morning, Good

John Massocca

As kind balance has of and kind that commodities also the, of volatility maybe impacted current the kind leased of mean quarter-end, I in some operations aren’t your the you at at know, re-leasing of pandemic you properties of look there? potential

Bob Cutlip

On John, the what re-leasing you're side, talking about? is

John Massocca

Yes, from a releasing side.

Bob Cutlip

I vacating partially to because and Minneapolis facility next we prospects. – in be seen of have when but I with facility. now, activity think leased know what then have has fact, me, I of vacant another that more that shut we vacant Yes month, the months, fully we’ve you can know, we there's in And are are drop. back, they're that Northern Ohio come buildings, right we've and they're that multi-tenant two that absolutely or properties the and the leased prospects has building there – have down but of Central not you think two next, two there as I March excuse end at for in indicated, tenants two Minneapolis XX% re-leased and the went think,

of Central of story there it, is the but for There's that a have, it. is I charter take Commons, Columbus building. lot we We, agreed we're in play think be and property tenants schools no the interest these to out balance of Northern end going moved anchor difficult a offices a about seeing have tenant and in year in last doubt Ohio One the which in a has the some to us. charter other Easton and the on anchor school, the tenant a single more at side – of

encouraged there. I'm So,

of it's location we're will not the the It we bag. think, can to stronger I if used of specific difficulty. the property. in upon, ones So, an you mixed we a don't of are as we're the see believe activity in location more have it's on – area side, have you mixed seeing and kind depends a but they're have larger where office urban I going getting now difficulties, from markets, If activities, have who

that to and – room got next to As you conclusion GM, press get in that know, the you here elephant know, we've big this months. my on several you know over is to

John Massocca

Okay.

– this reminder, your Tulsa and Just vacant? hedged asset is that still as a in still portfolio

Bob Cutlip

Yes.

a so. Tulsa. but do for next in our on of Port and for that’s We week building. we portfolio prospect entire the in have it’s in or It’s have Yes, that lease, Catoosa RFP expecting shorter-term we’re in – still one the a the

John Massocca

in that significant it would on percentage right, vacancy that Is be today, – that depends of of big that stands a no single up asset a [indiscernible] it? obviously portion makes the

Bob Cutlip

Exactly. or so is or around Every less. X% one other

John Massocca

assets of of impacts kind the little in categorized have what regards on industrial difference it say today be you manufacturing deeper on portfolio within a kind stands Digging kind Okay. your the to mean properties of industrial with will a versus seen I side, sentiment maybe between of reached reflected that distribution what out overall requests roughly your those two of had size maybe as it breakdown assets, as then you pertains deferral to tenants? kind portfolio? the been just or the like to categories And in is

Bob Cutlip

say is the auto just I assets one, two, goes Ford. be General for us, area we up And I, the plant. for but one manufacture upon as much we’ve then could distribution, Those of calls and more between would received to most sides I I side. say been frankly I and and are manufacturing, mean had industrial depending three would say that Motors service in deferrals how is that would know probably calls. have that the have the assembly XX% industry XX% Detroit few marks very manufacturing in distribution not if of an we I the time indicated, our I on split and you office question on the quite

John Massocca

kind in pricing debt but is Make of you then level if sorry that to this gears are of missed the I what prepared the on switching sense. remarks, and sheet, maybe have availability property the today seeing? balance And may

Mike Sodo

Yes. Sure.

to have the the we know as high-three’s. as you seen financing, low high-two’s asset single So

practically we single in type [indiscernible] look of to can the which and mean, from side to Obviously [indiscernible] basis I well, efficiently more financing have about. been feature our appraiser challenge perspective, go not well as get to financing ways So, the have but of about dislocation other a that that do very on is on the assets asset the as very are facility an well timing type as priced terms John, at is speaking today XXX] is back points if we pursuing. giving obviously in [XXX XXX [indiscernible] efficient, challenges material we a of lenders credit mean it’s the equity with roadblock. there availability, our property, our of I that

John Massocca

Okay, – is than restrictions on kind willingness that it any more operational a to of banks characterization? sounds a almost financing property bit fair like for rather a the lend, level

Mike Sodo

those yield CMBS market but has and most efficiently financing the has world good expensive, today, and to that not the opportunities is is answer a it out been priced but it yes and single market bond does shut, obviously borrow is are there been conversations high [indiscernible]. asset a we’ve short open but investment-grade been there, is the there, our is little alternatives

John Massocca

very you from That's it Alright. much. me. Thank

Mike Sodo

Thanks John.

Bob Cutlip

Thanks, John.

David Gladstone

Next question.

Operator

to the queue turn for questions any Gladstone Thank like further this David you. closing in And time. would at I’m showing no back to call I the remarks.

David Gladstone

all you thank Well for calling.

and continue but at Hopefully of get them We’ve this I good the in. problem, shape we short-term summer will tenants we’re luck we today. is had this, think into in around far to so turn end good thank for all our the you think I as pay. with and calling months a strong

Operator

program thank gentlemen, on and conference. you Ladies your participation today's does and for you This disconnect. your now may conclude