Gladstone Commercial Corporation Provides a Business Update

Rhea-AI Summary

Gladstone Commercial Corporation (Nasdaq: GOOD) reported strong performance amid COVID-19, with approximately 99% of July cash base rent paid, maintaining a consistent 98% collection rate since April. The company retained its dividend rate and reported a 97% portfolio occupancy. A six-year lease extension with Conduent State Healthcare increased GAAP rents by 24% and enhanced overall rental income by 14%. Since January, Gladstone has raised $31 million in capital, maintaining liquidity over $35 million.

Positive

• 99% of July cash base rent paid.
• Consistent 98% collection rate since April.
• Retained dividend rate despite COVID-19 impact.
• Portfolio occupancy at 97%.
• 24% increase in GAAP rents from recent lease extension.
• 14% rise in overall straight line rent.
• Raised $28.4 million from stock issuance.
• Ample liquidity exceeding $35 million.

Negative

• Potential future rent relief requests may impact cash flow.
• Uncertainty regarding future tenant financial stability.

MCLEAN, Va., July 16, 2020 (GLOBE NEWSWIRE) -- Gladstone Commercial Corporation (Nasdaq: GOOD) (“we” or “Gladstone Commercial”) is providing the following business update regarding portfolio performance during this time of market volatility related to the global COVID-19 pandemic.  

• We believe we are in the top 10% of collections for publicly traded U.S. equity REITs.  Approximately 99% of July cash base rent has been paid and collected. July rental collections remain consistent with 98% of June, May and April cash base rents that were paid and collected. The remaining 1-2% of cash base rents are associated with the previously agreed upon deferral agreements. All deferred amounts are to be paid back by the respective tenants commencing in July 2020 and ending in March 2021.
• We remain within a small subset of U.S. equity REITs that have maintained their dividend rate and payment of distributions in tandem with this level of rental collections during the COVID-19 pandemic.  Portfolio occupancy remains at approximately 97%, as of July 16, 2020.
• Our leasing initiatives continue to be successful in the COVID-19 environment.  On July 8^th we executed a six-year lease extension with Conduent State Healthcare at our 42,213 square foot office building in Richmond, VA. The extension maintains the building’s 100% occupancy until September 2026. GAAP rents increased 24% as a result of the transaction. This successful extension combined with the four lease extensions and tenant expansion in the second quarter increases the overall straight line rent at these properties by 14% and results in increased same store property NOI and an expected increased contribution to core FFO for the third quarter 2020.
• We have continued to raise additional capital to fund acquisitions and operating needs. Since January 1, 2020, we have issued 1.3 million shares of common stock for net proceeds of $28.4 million and 113,000 shares of Series E perpetual preferred stock for net proceeds of $2.6 million.
• We continue to have ample liquidity and a strong capital structure. As of July 16, 2020, our current available liquidity is in excess of $35 million via our revolving credit facility and cash on hand.

We may receive additional rent relief requests during the COVID-19 pandemic.  However, we are unable to quantify the outcomes of potential future negotiation of relief packages, the success of any tenant’s financial prospects or the amount of relief requests that we will ultimately receive or grant.

About Gladstone Commercial (Nasdaq: GOOD)

Gladstone Commercial is a real estate investment trust focused on acquiring, owning and operating net leased industrial and office properties across the United States. As of March 31, 2020, Gladstone Commercial’s real estate portfolio consisted of 122 properties located in 28 states, totaling approximately 15.1 million square feet. For additional information please visit www.gladstonecommercial.com

For Broker Submittals:

100%; border-collapse:collapse !important;">

50%; width:50%; min-width:50%;">South Central:	50%; width:50%; min-width:50%;">Midwest/Northeast:
Buzz Cooper	Matt Tucker
Senior Managing Director	Senior Managing Director
(703) 287-5815	(703) 287-5830
Buzz.Cooper@gladstonecompanies.com	Matt.Tucker@gladstonecompanies.com
Southeast / West:
Brandon Flickinger
Managing Director
(703) 287-5819
Brandon.Flickinger@gladstonecompanies.com

Investor or Media Inquiries:

100%; border-collapse:collapse !important;">

50%; width:50%; min-width:50%;">Bob Cutlip	50%; width:50%; min-width:50%;">
President – Gladstone Commercial Corporation
(703) 287-5878
Bob.Cutlip@gladstonecompanies.com

All statements contained in this press release, other than historical facts, may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates” and variations of these words and similar expressions are intended to identify forward-looking statements. Readers should not rely upon forward-looking statements because the matters they describe are subject to known and unknown risks and uncertainties that could cause the Gladstone Commercial’s business, financial condition, liquidity, results of operations, funds from operations or prospects to differ materially from those expressed in or implied by such statements. Such risks and uncertainties are disclosed under the caption “Risk Factors” of the company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, as filed with the SEC on February 12, 2020 and certain other filings we make with the SEC.  Gladstone Commercial cautions readers not to place undue reliance on any such forward-looking statements which speak only as of the date made. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

For Investor Relations inquiries related to any of the monthly dividend paying Gladstone funds, please visit www.gladstonecompanies.com.

SOURCE: Gladstone Commercial Corporation

FAQ

What is Gladstone Commercial Corporation's stock performance during COVID-19?

Gladstone Commercial reported a 99% cash base rent payment rate for July, maintaining strong collections.

How has Gladstone Commercial managed its dividends during the pandemic?

The company has maintained its dividend rate despite the challenges posed by COVID-19.

What percentage of occupancy does Gladstone Commercial currently have?

Gladstone Commercial's portfolio occupancy stands at approximately 97%.

How much capital has Gladstone Commercial raised since January 2020?

Since January 2020, Gladstone has raised $31 million in capital, enhancing its financial position.

What recent leasing activity has Gladstone Commercial completed?

Gladstone executed a six-year lease extension with Conduent State Healthcare, increasing GAAP rents by 24%.