Financial Performance - Rental income for the three months ended September 30, 2025, was $25,800 thousand, down from $26,731 thousand in the same period of 2024, a decrease of about 3.5%[19] - The net loss attributable to common shareholders for the three months ended September 30, 2025, was $3,499 thousand, compared to a loss of $24,395 thousand in the same period of 2024, showing an improvement of about 86%[19] - The company reported a net income of $3,780 thousand for the three months ended September 30, 2025, contrasting with a net loss of $26,549 thousand in the same period of 2024[21] - For the nine months ended September 30, 2025, the net loss was $336.381 million, compared to a net loss of $25.180 million for the same period in 2024[28] - The company reported a significant net loss of $265,300,000 for the quarter ending June 30, 2025[25] - Total comprehensive loss for the quarter ending June 30, 2024, was $19,195,000[23] Assets and Liabilities - Total assets decreased from $2,676,232 thousand as of December 31, 2024, to $1,986,374 thousand as of September 30, 2025, representing a decline of approximately 26%[16] - The total liabilities decreased from $1,524,210 thousand as of December 31, 2024, to $1,209,518 thousand as of September 30, 2025, a reduction of approximately 21%[16] - As of September 30, 2025, the company's total gross investment in real estate (excluding discontinued operations) was $1,263,937,000, down from $1,493,143,000 as of December 31, 2024[62] - The total real estate related to discontinued operations was $403,539,000 as of September 30, 2025, down from $995,152,000 as of December 31, 2024, indicating a reduction of about 59%[154] - The total real estate assets for industrial real estate net was $1,066,052,000 as of September 30, 2025, down from $1,100,936,000 as of December 31, 2024, a decrease of about 3%[154] Cash Flow and Investments - Cash and cash equivalents increased from $146,514 thousand as of December 31, 2024, to $326,085 thousand as of September 30, 2025, reflecting a growth of approximately 122%[16] - The net cash provided by operating activities for continuing operations was $2.715 million, an improvement from a net cash used of $1.608 million in 2024[28] - The company reported a net cash provided by investing activities of $450.282 million, significantly higher than $102.929 million in 2024[30] - The principal pay down of indebtedness for the credit facility was $200 million, compared to $10 million in the previous year[30] Real Estate Operations - The company is executing a strategic transition to an industrial-only real estate investment trust (REIT), focusing on growth in the industrial outdoor storage (IOS) sector[32] - The company completed the sale of 11 Office Discontinued Operations Properties during the nine months ended September 30, 2025[47] - The company acquired three industrial outdoor storage properties for a total purchase price of $57,106,000 during the three months ended September 30, 2025[65] - The company disposed of nine properties for a total gross sales price of $233,415,000 during the nine months ended September 30, 2025, resulting in a gain of $6,407,000[67] Shareholder Information - As of September 30, 2024, Peakstone Realty Trust reported total shareholders' equity of $1,132,171,000, with common shares totaling 36,377,254[23] - The company declared dividends to common shareholders amounting to $8,284,000 during the quarter ending June 30, 2024[23] - The company declared a cash dividend of $0.10 per common share for the quarter ended September 30, 2025, payable on or about October 17, 2025[155] - The Company had 36,790,867 common shares outstanding as of September 30, 2025, following its listing on the New York Stock Exchange on April 13, 2023[107][108] Debt and Interest Rates - The total consolidated debt as of September 30, 2025, was $1,050.8 million, down from $1,360.3 million as of December 31, 2024, reflecting a reduction of 22.7%[85] - The weighted average effective interest rate for the company's total debt was 5.46% as of September 30, 2025[85] - The Company has interest rate swaps with a notional amount of $550 million, effective from July 1, 2025, to July 1, 2029, converting SOFR to a weighted average fixed rate of 3.58%[96] - An increase of 100 basis points in interest rates would decrease future earnings and cash flows by approximately $1.9 million annually, considering the effect of interest rate swaps[272] Impairments and Expenses - The company experienced a significant real estate impairment provision of $18,195 thousand for the nine months ended September 30, 2025, compared to $50,774 thousand in the same period of 2024[19] - Total expenses for the nine months ended September 30, 2025, were $390,788,000, significantly higher than $50,493,000 in 2024, primarily due to a real estate impairment provision of $345,492,000[50] - The company recorded real estate impairments of $25.6 million related to eight Office Discontinued Operations Properties during the three months ended September 30, 2025, due to shortened anticipated hold periods and estimated selling prices[76] Other Financial Metrics - The accumulated deficit as of September 30, 2024, was $850,992,000, reflecting an increase from $826,597,000 as of June 30, 2024[23] - The fair value of total secured debt as of September 30, 2025, was $242,675, down from $250,766 as of December 31, 2024[106] - The Company recognized $70.6 million in lease income related to operating lease payments for the nine months ended September 30, 2025, compared to $74.1 million for the same period in 2024, indicating a decrease of 6.5%[133]

Revenue and Income - Revenue from continuing operations was approximately $25.8 million, a decrease from $26.7 million in the same quarter last year[12]. - Net income attributable to common shareholders was approximately $3.5 million, or $0.09 per share, compared to a net loss of approximately $(24.4) million, or $(0.67) per share, for the same quarter last year[13]. - Rental income for the three months ended September 30, 2025, was $25,800 thousand, down from $26,731 thousand in the same period of 2024, a decrease of about 3.5%[32]. - Net income for the three months ended September 30, 2025, was $3,780, compared to a net loss of $26,549 in the same period of 2024[42]. - The company reported a net income from discontinued operations of $10,813 for Q3 2025, compared to $9,583 in Q3 2024, showing a year-over-year increase of approximately 12.9%[53]. Funds from Operations - Core Funds from Operations (Core FFO) was approximately $19.1 million, or $0.48 per share, down from $24.0 million, or $0.61 per share, in the same quarter last year[14]. - Adjusted Funds from Operations (AFFO) was approximately $18.6 million, or $0.47 per share, compared to $25.7 million, or $0.65 per share, for the same quarter last year[14]. - Funds from Operations (FFO) for the three months ended September 30, 2025, were $18,312 thousand, down from $23,060 thousand in 2024, a decrease of about 20.5%[38]. - Core Funds from Operations (Core FFO) for the three months ended September 30, 2025, were $19,057 thousand, compared to $23,959 thousand in 2024, reflecting a decline of approximately 20.5%[38]. - Adjusted Funds from Operations (AFFO) for the three months ended September 30, 2025, were $18,637 thousand, down from $25,689 thousand in 2024, a decrease of about 27.4%[38]. Expenses and Liabilities - Total expenses for the three months ended September 30, 2025, were $24,648 thousand, significantly lower than $68,880 thousand in the same period of 2024, indicating a reduction of approximately 64%[32]. - Total liabilities decreased from $1,524,210 thousand as of December 31, 2024, to $1,209,518 thousand as of September 30, 2025, a reduction of about 20.6%[30]. - The Company ended the quarter with a liquidity of $438.0 million, including cash and cash equivalents of $326.1 million[19]. Asset and Equity Changes - Total assets decreased from $2,676,232 thousand as of December 31, 2024, to $1,986,374 thousand as of September 30, 2025, representing a decline of approximately 26%[30]. - Shareholders' equity decreased from $1,152,022 thousand as of December 31, 2024, to $776,856 thousand as of September 30, 2025, representing a decline of approximately 32.5%[30]. Operational Performance - Same Store Cash Net Operating Income (Same Store Cash NOI) increased by 3.7% to approximately $11.4 million compared to the same quarter last year[16]. - Total Net Operating Income (NOI) increased to $22,520 for Q3 2025, up from $20,738 in Q3 2024, representing a growth of approximately 8.5%[42]. - Cash NOI for the same store portfolio was $11,390 in Q3 2025, compared to $10,986 in Q3 2024, indicating an increase of about 3.7%[42]. - EBITDA for Q3 2025 was reported at $41,848, while EBITDAre was $36,045, reflecting the company's operational performance[51]. - Adjusted EBITDAre for Q3 2025 stood at $33,397, demonstrating the company's ability to manage expenses effectively[51]. Real Estate Transactions - The Company executed several Industrial Outdoor Storage (IOS) leases that will add approximately $1.1 million of incremental IOS ABR, with weighted average releasing spreads of 116% on a cash basis[9]. - The Company sold eight office properties totaling approximately 1.2 million square feet for approximately $247.5 million during the quarter[15]. - Rental income from discontinued operations was $25,225 in Q3 2025, down from $28,229 in Q3 2024, a decrease of approximately 7.1%[53]. - Total expenses related to discontinued operations increased to $37,330 in Q3 2025, compared to $17,120 in Q3 2024, primarily due to real estate impairment provisions[53]. - The company recorded a real estate impairment provision of $25,604 in Q3 2025, compared to none in Q3 2024, indicating a significant change in asset valuation[53].

Core Insights - Alluvial Capital Management's fund achieved a 15.5% increase in Q3 2025, resulting in year-to-date returns of 33.6%, marking the third-best quarterly performance in its 9-year history [1] Company Overview - Peakstone Realty Trust (NYSE:PKST) is a real estate investment trust focusing on transitioning its portfolio towards industrial properties [2][3] - As of October 28, 2025, Peakstone Realty Trust's stock closed at $14.02 per share, with a market capitalization of $515.81 million [2] Performance Metrics - Peakstone Realty Trust experienced a one-month return of 6.21% and a 52-week gain of 5.89% [2] - The trust has seen a 20% increase this year as it shifts from mixed office and industrial properties to purely industrial properties [3] Investment Sentiment - Peakstone Realty Trust is not listed among the 30 Most Popular Stocks Among Hedge Funds, with a belief that certain AI stocks present greater upside potential and lower downside risk [4]

Core Viewpoint - Peakstone Realty Trust is transitioning to an industrial REIT focusing on growth in the industrial outdoor storage sector [1] Financial Results Announcement - The company will release its third quarter 2025 financial results after the market closes on November 5, 2025 [1] - A webcast to present the results is scheduled for November 5, 2025, at 5:00 p.m. Eastern Time [1]

Core Viewpoint - Peakstone Realty Trust is transitioning to an industrial REIT focusing on growth in the industrial outdoor storage sector [1] Financial Results Announcement - The company will release its third quarter 2025 financial results after the market closes on November 5, 2025 [1] - A webcast to present the results is scheduled for November 5, 2025, at 5:00 p.m. Eastern Time [1]

Company Overview - Peakstone Realty Trust (PKST) is transitioning its business model by divesting from office properties to concentrate fully on the industrial sector, specifically in the Industrial Outdoor Storage (IOS) segment [1]. Market Context - The shift in focus is influenced by the rise of remote work trends following the COVID-19 pandemic, which has altered the demand for traditional office spaces [1].

Core Insights - Peakstone Realty Trust reported better-than-expected operational earnings in Q2 2025, with adjusted funds from operations (AFFO) per share at $0.61, significantly above the analyst estimate of $0.05 [1][5] - The company experienced a substantial net loss of $(265.3 million) due to a major non-cash impairment of $286.1 million on office assets, highlighting ongoing challenges in the office property sector [1][6] - Peakstone is actively transitioning its portfolio from office properties to industrial real estate, particularly focusing on the Industrial Outdoor Storage (IOS) sector [4][12] Financial Performance - GAAP revenue for Q2 2025 was $54.0 million, slightly above the consensus but down 3.6% from $56.0 million in Q2 2024 [2][5] - Same Store Cash Net Operating Income (NOI) increased by 6.3%, with industrial properties showing a 9.3% rise, indicating core rental growth despite challenges in the office sector [7] - The company declared a Q3 2025 dividend of $0.10 per share, a reduction of over 50% from the previous quarter, reflecting the evolving cash flow profile [11] Strategic Developments - Peakstone Realty Trust has intensified its pivot away from office properties, selling $158 million in office assets and planning further dispositions [6][12] - The company completed two IOS acquisitions totaling $52.4 million and secured a new lease for IOS redevelopment in Savannah, Georgia [8] - Management expects to accelerate the pace of office asset sales in the coming months to further reduce office exposure and expand the IOS footprint [12][13] Capital Management - The net debt to adjusted EBITDAre ratio improved to 6.4x from 6.6x, aided by proceeds from office sales [10] - Cash and equivalents at quarter-end were $264.4 million, with total liquidity of $355.8 million, indicating a strong liquidity position [10] - Nearly 88% of the company's debt is funded at fixed rates, with a weighted average debt maturity of three years, supporting financial stability [10]

Financial Data and Key Metrics Changes - For Q2 2025, total revenue was approximately $54 million and cash NOI was approximately $43 million [11] - Net loss attributable to common shareholders was approximately $265 million or $7.22 per share, primarily due to noncash impairments of approximately $286 million [11] - FFO was approximately $23.9 million or $0.60 per share on a fully diluted basis, while core FFO was approximately $23.8 million or $0.60 per share [12] - Same store cash NOI increased by 6.3% overall, with a 9.3% increase in the industrial segment and a 4.7% increase in the office segment [12] - Total liquidity at quarter end was approximately $356 million, with a cash balance of approximately $264 million [13] Business Line Data and Key Metrics Changes - The industrial outdoor storage (iOS) segment saw an increase in ABR by over 25% since the beginning of the year [9] - The office segment now represents 35% of the net book value of real estate assets, down from a higher percentage as the company divests office properties [10] Market Data and Key Metrics Changes - The company sold seven office properties for $158 million through quarter end and an additional two properties for $24 million after quarter end, totaling $216 million year to date [10] - The company recognized a noncash impairment of approximately $286 million related to 18 office properties, reflecting updated expectations for sale pricing [10] Company Strategy and Development Direction - The company is focused on transforming into an industrial REIT, emphasizing growth in the iOS subsector through acquisitions and leasing while divesting remaining office assets [5] - The strategy includes reducing leverage and aligning the portfolio with higher growth opportunities in the industrial sector [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strategy and ability to execute, highlighting the importance of reshaping the portfolio and reallocating capital to higher growth iOS opportunities [17] - The board approved a dividend of 10 cents per common share for Q3, reflecting the ongoing transition to an exclusively industrial strategy [14] Other Important Information - The company has a significant pipeline for acquisitions in the iOS space, with a focus on markets with strong demand growth and supply constraints [46] - The weighted average interest rate on all debt is approximately 5.47% after recent interest rate swaps [14] Q&A Session Summary Question: Can you provide more insight into the Board's thinking around the dividend? - Management indicated that the dividend aligns with the cash flow characteristics of the industrial outdoor storage segment and reflects the transition to an industrial REIT [18] Question: What is the renewal percentage for iOS leases? - Management noted that there is very little rollover, with only 0.4% vacancy in the operating portfolio, and they expect most tenants to renew their leases [20] Question: What are the cap rates for iOS acquisitions and office sales? - Management did not provide individual cap rates but mentioned that aggregated data is available for analysis [25] Question: How will proceeds from office sales be used? - Management stated that they aim to reduce leverage below six times debt to EBITDA while remaining active in the acquisition market [29] Question: Has competition increased in the iOS space? - Management confirmed that the market is active with increased capital for iOS, but their experience and national portfolio provide a competitive advantage [33] Question: What triggered the impairment this quarter? - The impairment was driven by the acceleration of sales and a shorter anticipated hold period, necessitating a fair value calculation [39] Question: What is currently in the iOS pipeline? - Management refrained from disclosing specific details but confirmed a sufficient pipeline with opportunities in markets with strong demand and supply constraints [45]

Business Strategy - The company is accelerating its shift to an Industrial REIT, focusing on Industrial Outdoor Storage (IOS) and traditional industrial assets, with the intention to scale IOS and exit the office sector[12] - The company is committed to selling all remaining office properties, having already completed approximately $2.2 billion in office dispositions since 2022, with an expected acceleration in the pace of sales[13] Portfolio Performance and Acquisitions - The company increased IOS Annualized Base Rent (ABR) by over 25% since the beginning of the year[16] - The company acquired two IOS assets for approximately $52 million, encompassing approximately 36.2 usable acres and generating $3.2 million in ABR, with an estimated 13% mark-to-market opportunity[5] - The company completed $158 million in sales during the quarter and an additional $24 million subsequent to quarter-end, bringing the year-to-date sales total to $216 million[5] Financial Position - The company is targeting a Net Debt / EBITDAre ratio at or below 6.0x and is using interest rate swaps to manage floating-rate exposure[13] - The company's Net Debt / Adjusted EBITDAre was 7.0x in Q1 2025, 6.4x in Q2 2025, and a pro forma 6.6x for Q2 2025[5] - The remaining office net book value is $615 million, representing approximately 35% of the real estate net book value[5] Industrial Portfolio Composition - The industrial portfolio consists of 53 IOS properties and 19 traditional industrial assets[48] - The industrial portfolio is approximately 100% leased, with a weighted average lease term (WALT) of 5.1 years and in-place ABR of $78.7 million[43] - The industrial portfolio has embedded growth potential, driven by an estimated 38% mark-to-market opportunity and contractual rent escalations averaging 2.5%[43]

[PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) The unaudited consolidated financial statements reflect a significant net loss driven by real estate impairments and a strategic portfolio shift [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheet Summary (in thousands) | Account | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $264,392 | $146,514 | $117,878 | | Total real estate, net | $1,706,264 | $2,264,048 | ($557,784) | | **Total assets** | **$2,190,570** | **$2,676,232** | **($485,662)** | | Debt, net | $1,246,767 | $1,344,619 | ($97,852) | | **Total liabilities** | **$1,414,333** | **$1,524,210** | **($109,877)** | | **Total equity** | **$776,237** | **$1,152,022** | **($375,785)** | - The significant decrease in total assets and equity is primarily driven by **property dispositions and real estate impairment charges**, reflecting the company's strategic shift away from office properties[16](index=16&type=chunk) [Consolidated Statements of Operations](index=7&type=section&id=Consolidated%20Statements%20of%20Operations) Consolidated Statements of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Rental income | $54,026 | $55,952 | $110,997 | $115,179 | | Real estate impairment provision | $286,126 | $6,505 | $338,083 | $7,881 | | **Net (loss) income** | **($286,760)** | **($4,101)** | **($340,162)** | **$1,369** | | **Net (loss) income attributable to common shareholders** | **($265,300)** | **($3,768)** | **($314,683)** | **$1,257** | | **Net (loss) income per share, basic and diluted** | **($7.22)** | **($0.11)** | **($8.57)** | **$0.03** | - The company reported a substantial net loss for the three and six months ended June 30, 2025, primarily due to a significant increase in real estate impairment provisions, which rose to **$338.1 million** for the six-month period compared to just **$7.9 million** in the prior year period[19](index=19&type=chunk) [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated Cash Flow Summary - Six Months Ended June 30 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $39,740 | $40,728 | | Net cash provided by investing activities | $197,206 | $67,870 | | Net cash used in financing activities | ($118,444) | ($48,312) | - Investing activities provided a significant source of cash (**$197.2 million**) in the first six months of 2025, largely from **$187.0 million** in proceeds from property dispositions[29](index=29&type=chunk)[30](index=30&type=chunk) - This cash was partly used for financing activities, including a **$100.0 million** paydown of the credit facility[29](index=29&type=chunk)[30](index=30&type=chunk) [Notes to Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Detailed notes cover the strategic transition to an industrial-only REIT, significant impairments, and segment performance shifts - The Company is executing a strategic transition to become an industrial-only REIT, focusing on growth in the industrial outdoor storage (IOS) sector while actively divesting its office properties[32](index=32&type=chunk) Real Estate Dispositions - Six Months Ended June 30, 2025 | Segment | Number of Properties | Gross Sales Price | Gain (Loss) | | :--- | :--- | :--- | :--- | | Office | 9 | $192,431 | ($1,545) | Real Estate Impairments - Six Months Ended June 30, 2025 | Segment | Number of Properties | Impairment Amount | | :--- | :--- | :--- | | Office | 24 | $334,924 | | Industrial | 1 | $3,159 | | **Total** | **25** | **$338,083** | - Subsequent to quarter-end, the company acquired two IOS properties for **$52.4 million** and sold two Office segment properties for **$23.6 million**, continuing its strategic portfolio reshaping[140](index=140&type=chunk)[141](index=141&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the strategic shift to an industrial REIT, portfolio performance, non-GAAP measures, and capital resources [Overview and Business Environment](index=36&type=section&id=Overview%20and%20Business%20Environment) - The company is strategically transitioning to become an industrial-only REIT, targeting growth in the Industrial Outdoor Storage (IOS) sector while divesting office properties[144](index=144&type=chunk)[164](index=164&type=chunk) - Management believes long-term demand for industrial real estate will remain strong due to onshoring trends, e-commerce growth, and supply constraints[166](index=166&type=chunk)[167](index=167&type=chunk) Top 5 Tenants by Annualized Base Rent (ABR) as of June 30, 2025 | Tenant | ABR (in thousands) | % of Total ABR | | :--- | :--- | :--- | | Keurig Dr. Pepper | $11,897 | 7.1% | | Amazon | $10,003 | 6.0% | | Southern Company Services | $9,597 | 5.7% | | Maxar | $7,916 | 4.7% | | Freeport McMoRan | $7,867 | 4.7% | [Results of Operations](index=40&type=section&id=Results%20of%20Operations) Same Store NOI Change - Q2 2025 vs Q2 2024 (in thousands) | Segment | Q2 2025 Same Store NOI | Q2 2024 Same Store NOI | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Industrial | $12,918 | $12,854 | $64 | 0% | | Office | $22,447 | $22,018 | $429 | 2% | | **Total** | **$35,365** | **$34,872** | **$493** | **1%** | Total Portfolio NOI Change - Six Months Ended June 30 (in thousands) | Segment | H1 2025 NOI | H1 2024 NOI | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Industrial | $41,887 | $25,369 | $16,518 | 65% | | Office | $51,704 | $54,843 | ($3,139) | (6)% | | Other | $0 | $12,838 | ($12,838) | (100)% | | **Total** | **$93,591** | **$93,050** | **$541** | **1%** | - The net loss of **$340.2 million** for H1 2025 was primarily driven by a **$330.2 million** year-over-year increase in real estate impairment charges related to the planned disposition of office properties[192](index=192&type=chunk)[198](index=198&type=chunk) - The significant **65% increase in Industrial NOI** for H1 2025 was driven by the acquisition of the IOS Portfolio in late 2024, while the decrease in Office and Other NOI reflects the impact of property dispositions[193](index=193&type=chunk)[194](index=194&type=chunk)[195](index=195&type=chunk) [Non-GAAP Financial Measures](index=49&type=section&id=Non-GAAP%20Financial%20Measures) FFO, Core FFO, and AFFO per Share/Unit | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | FFO per share/unit | $0.60 | $0.65 | $1.22 | $1.18 | | Core FFO per share/unit | $0.60 | $0.65 | $1.22 | $1.30 | | AFFO per share/unit | $0.61 | $0.70 | $1.24 | $1.40 | - FFO is significantly higher than net income primarily due to the exclusion of large non-cash charges for real estate impairment (**$286.1M in Q2 2025**) and depreciation[213](index=213&type=chunk) Total Cash NOI (in thousands) | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended June 30 | $43,196 | $44,002 | | Six Months Ended June 30 | $88,798 | $91,333 | [Liquidity and Capital Resources](index=53&type=section&id=Liquidity%20and%20Capital%20Resources) - As of June 30, 2025, the company had **$264.4 million in cash** and cash equivalents and **$91.4 million of available undrawn capacity** under its Revolving Credit Facility[219](index=219&type=chunk)[220](index=220&type=chunk) Consolidated Debt Summary as of June 30, 2025 (in thousands) | Debt Type | Amount | | :--- | :--- | | Total Secured Debt | $360,326 | | Total Unsecured Debt | $900,000 | | **Total Debt** | **$1,260,326** | | Unamortized Costs & Discounts, net | ($13,559) | | **Total Debt, net** | **$1,246,767** | - In April 2025, the company made a **$100.0 million paydown** of its Revolving Loan and was in compliance with all debt covenants as of June 30, 2025[233](index=233&type=chunk)[232](index=232&type=chunk) - On August 5, 2025, the Board declared a quarterly dividend of **$0.10 per common share**, a reduction from the previous quarter's **$0.225 per share** dividend[139](index=139&type=chunk)[226](index=226&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=58&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk from variable-rate debt, which is managed through interest rate swaps - The company's primary market risk exposure is to interest rate changes on its variable-rate debt[238](index=238&type=chunk) - As of June 30, 2025, the company's debt consisted of approximately **$1.1 billion in fixed-rate debt** (including swaps) and **$150.0 million in variable-rate debt**[241](index=241&type=chunk) - A hypothetical **100 basis point increase** in interest rates would decrease annual earnings and cash flows by approximately **$3.3 million**, after accounting for interest rate swaps[241](index=241&type=chunk) [Controls and Procedures](index=58&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[243](index=243&type=chunk) - No changes occurred during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[244](index=244&type=chunk) [PART II. OTHER INFORMATION](index=59&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=59&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that there are no material pending legal proceedings to which it is a party - The company reported no material legal proceedings[245](index=245&type=chunk) [Risk Factors](index=59&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's 2024 Annual Report on Form 10-K - There were no material changes to the risk factors from the company's most recent Form 10-K[246](index=246&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=59&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reports no sales of unregistered securities or repurchases of its equity securities during the relevant periods - During the six months ended June 30, 2025, there were no sales of unregistered securities[247](index=247&type=chunk) - The Company did not repurchase any of its shares during the three months ended June 30, 2025[248](index=248&type=chunk) [Defaults Upon Senior Securities](index=59&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities - None reported[249](index=249&type=chunk) [Other Information](index=59&type=section&id=Item%205.%20Other%20Information) No trustee or officer adopted or terminated a Rule 10b5-1 trading arrangement during the quarter - No trustee or officer adopted or terminated a Rule 10b5-1 trading arrangement during the quarter[251](index=251&type=chunk) [Exhibits](index=59&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including officer certifications and interactive data files