3 months ago
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- Completed $835 Million in Dispositions in 2024, Surpassing High-End of Increased Guidance
- Reduced Net Debt by $734 million in 2024; Improved Net Debt to Adjusted EBITDA to 7.6x
- Company Meets and Exceeds its Full-Year 2024 Earnings Guidance
- Recently Announced $1.8 Billion Multi-Tenant Portfolio Sale Would Significantly Reduce Leverage and Improve Liquidity Position
- Proposed Transaction Would Create Pure-Play, Single-Tenant Net Lease Company with Enhanced Portfolio Metrics
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- Company Initiates Opportunistic $300 Million Share Repurchase Program
NEW YORK, Feb. 27, 2025 (GLOBE NEWSWIRE) -- Global Net Lease, Inc. (NYSE: GNL) ("GNL” or the "Company”), an internally managed real estate investment trust that focuses on acquiring and managing a globally diversified portfolio of strategically-located commercial real estate properties, announced today its financial and operating results for the quarter and year ended December 31, 2024.
Fourth Quarter and Full Year 2024 Highlights
- Revenue was $199.1 million in fourth quarter 2024 compared to $206.7 million in fourth quarter 2023, primarily as a result of $835 million of dispositions closed throughout the year
- Net loss attributable to common stockholders was $17.5 million in fourth quarter 2024, compared to $59.5 million in fourth quarter 2023
- Core Funds From Operations ("Core FFO”) was $68.5 million, or $0.30 per share, in fourth quarter 2024, compared to $48.3 million, or $0.21 per share, in fourth quarter 2023
- Adjusted Funds From Operations ("AFFO”)1 was $78.3 million2, or $0.34 per share, in fourth quarter 2024, compared to $71.7 million, or $0.31 per share, in fourth quarter 2023; full-year 2024 AFFO was $303.8 million, or $1.32 per share
- Closed $835 million of dispositions in 2024 at a cash cap rate of 7.1% with a weighted average lease term of 4.9 years
- Reduced net debt by $734 million in 2024, improving Net Debt to Adjusted EBITDA from 8.4x to 7.6x2
- Exceeded projected cost synergies, reaching $85.0 million versus the expected $75.0 million, highlighting the Company's successful integration efforts and ability to drive value through strategic initiatives
- Increased portfolio occupancy from 93% as of the end of first quarter 2024 to 97% as of the end of the fourth quarter of 2024
- Leased 1.2 million square feet across the portfolio, resulting in nearly $17.0 million of new straight-line rent
- Renewal leasing spread of 6.8% with a weighted average lease term of 9.7 years; new leases completed in the quarter had a weighted average lease term of 6.5 years
- Weighted average annual rent increase of 1.3% provides organic rental growth, excluding 14.8% of the portfolio with CPI linked leases that have historically experienced significantly higher rental increase
- Sector-leading 61% of annualized straight-line rent comes from investment-grade or implied investment-grade tenants3
Multi-Tenant Portfolio Sale
- Entered into a binding agreement to sell its multi-tenant portfolio of 100 non-core properties for approximately $1.8 billion
- This strategic transaction would accelerate GNL's disposition initiative and position the Company for sustained growth and value creation as a pure-play, single-tenant net lease company
"We are incredibly proud of our achievements at GNL in 2024 and even more excited about what lies ahead,” stated Michael Weil, CEO of GNL. "The sale of our multi-tenant portfolio would mark a pivotal moment, reinforcing the strong momentum we have built. This transaction would reshape GNL into a pure-play, single-tenant net lease company, eliminating the operational complexities, G&A expenses and capital expenditures tied to multi-tenant retail properties. More importantly, it would accelerate our deleveraging strategy and fortify our balance sheet. This strategic transformation, including the recently announced share repurchase program, underscores our long-term vision, reinforcing our commitment to prudent management, sustainable growth and driving meaningful shareholder value.”
Full Year 2025 Guidance and Dividend Update4
The Company is establishing initial 2025 guidance, which is contingent on the sale of our multi-tenant portfolio with respect to AFFO and Net Debt to Adjusted EBITDA.
- AFFO per share range of $0.90 to $0.96
- Net Debt to Adjusted EBITDA range of 6.5x to 7.1x
- Reduced annual dividend to $0.190 per share of common stock beginning with the dividend expected to be declared in April 2025 which would generate $78 million in incremental annual cash flow
Summary Fourth Quarter 2024 Results
| Three Months Ended
December 31, | |||||||||
| (In thousands, except per share data) | 2024 | 2023 | |||||||
| Revenue from tenants | $ | 199,115 | $ | 206,726 | |||||
| Net loss attributable to common stockholders | $ | (17,458 | ) | $ | (59,514 | ) | |||
| Net loss per diluted common share | $ | (0.08 | ) | $ | (0.26 | ) | |||
| NAREIT defined FFO attributable to common stockholders | $ | 64,334 | $ | 43,165 | |||||
| NAREIT defined FFO per diluted common share | $ | 0.28 | $ | 0.19 | |||||
| Core FFO attributable to common stockholders | $ | 68,538 | $ | 48,331 | |||||
| Core FFO per diluted common share | $ | 0.30 | $ | 0.21 | |||||
| AFFO attributable to common stockholders | $ | 78,297 | $ | 71,656 | |||||
| AFFO per diluted common share | $ | 0.34 | $ | 0.31 | |||||
Property Portfolio
At December 31, 2024, the Company's portfolio consisted of 1,121 net leased properties located in ten countries and territories and comprised of 60.7 million rentable square feet. The Company operates in four reportable segments: (1) Industrial & Distribution, (2) Multi-Tenant Retail, (3) Single-Tenant Retail and (4) Office. The real estate portfolio metrics include:
- 97% leased with a remaining weighted-average lease term of 6.2 years5
- 81% of the portfolio contains contractual rent increases based on annualized straight-line rent
- 61% of portfolio annualized straight-line rent derived from investment grade and implied investment grade rated tenants
- 80% U.S. and Canada, 20% Europe (based on annualized straight-line rent)
- 34% Industrial & Distribution, 28% Multi-Tenant Retail, 21% Single-Tenant Retail and 17% Office (based on an annualized straight-line rent)
Capital Structure and Liquidity Resources6
As of December 31, 2024, the Company had liquidity of $492.2 million and $460.0 million of capacity under the Company's revolving credit facility. The Company had net debt of $4.6 billion7, including $2.3 billion of mortgage debt.
As of December 31, 2024, the percentage of debt that is fixed rate (including variable rate debt fixed with swaps) was 91%, compared to approximately 80% as of December 31, 2023. The Company's total combined debt had a weighted average interest rate of 4.8% resulting in an interest coverage ratio of 2.5 times8. Weighted average debt maturity was 3.0 years as of December 31, 2024 as compared to 3.2 years as of December 31, 2023.
Footnotes/Definitions
| 1 | While we consider AFFO a useful indicator of our performance, we do not consider AFFO as an alternative to net income (loss) or as a measure of liquidity. Furthermore, other REITs may define AFFO differently than we do. Projected AFFO per share data included in this release is for informational purposes only and should not be relied upon as indicative of future dividends or as a measure of future liquidity. AFFO for the fourth quarter 2024 also contains a number of adjustments for items that the Company believes were non-recurring, one-time items including adjustments for items that were settled in cash such as merger and proxy related expenses. |
| 2 | Includes the collection of $4.5 million in past-due funds from Children of America and approximately $3.0 million in termination fees. |
| 3 | As used herein, "Investment Grade Rating” includes both actual investment grade ratings of the tenant or guarantor, if available, or implied investment grade. Implied Investment Grade may include actual ratings of tenant parent, guarantor parent (regardless of whether or not the parent has guaranteed the tenant's obligation under the lease) or by using a proprietary Moody's analytical tool, which generates an implied rating by measuring a company's probability of default. The term "parent” for these purposes includes any entity, including any governmental entity, owning more than 50% of the voting stock in a tenant. Ratings information is as of December 31, 2024. Comprised of 31.4% leased to tenants with an actual investment grade rating and 29.1% leased to tenants with an Implied Investment Grade rating based on annualized cash rent as of December 31, 2024. |
| 4 | We do not provide guidance on net income. We only provide guidance on AFFO per share and our Net Debt to Adjusted EBITDA ratio and do not provide reconciliations of this forward-looking non-GAAP guidance to net income per share or our debt to net income due to the inherent difficulty in quantifying certain items necessary to provide such reconciliations as a result of their unknown effect, timing and potential significance. Examples of such items include impairment of assets, gains and losses from sales of assets, and depreciation and amortization from new acquisitions and other non-recurring expenses. |
| 5 | Weighted-average remaining lease term in years is based on square feet as of December 31, 2024. |
| 6 | During the year ended December 31, 2024, the Company did not sell any shares of Common Stock or Series B Preferred Stock through its Common Stock or Series B Preferred Stock under its "at-the-market” programs. |
| 7 | Comprised of the principal amount of GNL's outstanding debt totaling $4.7 billion less cash and cash equivalents totaling $159.7 million, as of December 31, 2024. |
| 8 | The interest coverage ratio is calculated by dividing adjusted EBITDA for the applicable quarter by cash paid for interest (calculated based on the interest expense less non-cash portion of interest expense and amortization of mortgage (discount) premium, net). Management believes that interest coverage ratio is a useful supplemental measure of our ability to service our debt obligations. Adjusted EBITDA and cash paid for interest are Non-GAAP metrics and are reconciled below. |
Conference Call
GNL will host a webcast and conference call on February 28, 2025 at 11:00 a.m. ET to discuss its financial and operating results.
To listen to the live call, please go to GNL's "Investor Relations” section of the website at least 15 minutes prior to the start of the call to register and download any necessary audio software.
Dial-in instructions for the conference call and the replay are outlined below.
Conference Call Details
Live Call
Dial-In (Toll Free): 1-877-407-0792
International Dial-In: 1-201-689-8263
Conference Replay
For those who are not able to listen to the live broadcast, a replay will be available shortly after the call on the GNL website at www.globalnetlease.com.
Or dial-in below:
Domestic Dial-In (Toll Free): 1-844-512-2921
International Dial-In: 1-412-317-6671
Conference Number: 13746750
*Available from 2:00 p.m. ET on February 28, 2025 through May 28, 2025.
Supplemental Schedules
The Company will file supplemental information packages with the Securities and Exchange Commission (the "SEC”) to provide additional disclosure and financial information. Once posted, the supplemental package can be found under the "Presentations” tab in the Investor Relations section of GNL's website at www.globalnetlease.com and on the SEC website at www.sec.gov.
About Global Net Lease, Inc.
Global Net Lease, Inc. (NYSE: GNL) is a publicly traded internally managed real estate investment trust that focuses on acquiring and managing a global portfolio of income producing net lease assets across the U.S., and Western and Northern Europe. Additional information about GNL can be found on its website at www.globalnetlease.com.
Forward-Looking Statements
The statements in this press release that are not historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that could cause the outcome to be materially different. The words such as "may,” "will,” "seeks,” "anticipates,” "believes,” "expects,” "estimates,” "projects,” "potential,” "predicts,” "plans,” "intends,” "would,” "could,” "should” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements are subject to a number of risks, uncertainties and other factors, many of which are outside of the Company's control, which could cause actual results to differ materially from the results contemplated by the forward-looking statements. These risks and uncertainties include the risks that any potential future acquisition or disposition (including the multi-tenant portfolio sale) by the Company is subject to market conditions, capital availability and timing considerations and may not be identified or completed on favorable terms, or at all. Some of the risks and uncertainties, although not all risks and uncertainties, that could cause the Company's actual results to differ materially from those presented in the Company's forward-looking statements are set forth in the "Risk Factors” and "Quantitative and Qualitative Disclosures about Market Risk” sections in the Company's Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q, and all of its other filings with the U.S. Securities and Exchange Commission, as such risks, uncertainties and other important factors may be updated from time to time in the Company's subsequent reports. Further, forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update or revise any forward-looking statement to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law.
Contacts:
Investors and Media:
Email: [email protected]
Phone: (332) 265-2020
| Global Net Lease, Inc. Consolidated Balance Sheets (In thousands) | ||||||||
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| ASSETS | (Unaudited) | |||||||
| Real estate investments, at cost: | ||||||||
| Land | $ | 1,172,146 | $ | 1,430,607 | ||||
| Buildings, fixtures and improvements | 5,293,468 | 5,842,314 | ||||||
| Construction in progress | 4,350 | 23,242 | ||||||
| Acquired intangible lease assets | 1,057,967 | 1,359,981 | ||||||
| Total real estate investments, at cost | 7,527,931 | 8,656,144 | ||||||
| Less: accumulated depreciation and amortization | (1,164,629 | ) | (1,083,824 | ) | ||||
| Total real estate investments, net | 6,363,302 | 7,572,320 | ||||||
| Assets held for sale | 17,406 | 3,188 | ||||||
| Cash and cash equivalents | 159,698 | 121,566 | ||||||
| Restricted cash | 64,510 | 40,833 | ||||||
| Derivative assets, at fair value | 2,471 | 10,615 | ||||||
| Unbilled straight-line rent | 99,501 | 84,254 | ||||||
| Operating lease right-of-use asset | 74,270 | 77,008 | ||||||
| Prepaid expenses and other assets | 108,562 | 121,997 | ||||||
| Deferred tax assets | 4,866 | 4,808 | ||||||
| Goodwill | 51,370 | 46,976 | ||||||
| Deferred financing costs, net | 9,808 | 15,412 | ||||||
| Total Assets | $ | 6,955,764 | $ | 8,098,977 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Mortgage notes payable, net | $ | 2,221,706 | $ | 2,517,868 | ||||
| Revolving credit facility | 1,390,292 | 1,744,182 | ||||||
| Senior notes, net | 906,101 | 886,045 | ||||||
| Acquired intangible lease liabilities, net | 76,800 | 95,810 | ||||||
| Derivative liabilities, at fair value | 3,719 | 5,145 | ||||||
| Accounts payable and accrued expenses | 75,735 | 99,014 | ||||||
| Operating lease liability | 48,333 | 48,369 | ||||||
| Prepaid rent | 28,734 | 46,213 | ||||||
| Deferred tax liability | 5,477 | 6,009 | ||||||
| Dividends payable | 11,909 | 11,173 | ||||||
| Total Liabilities |
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