# W. P. Carey Inc.: Form 10-Q for the period ended Mar 31, 2025

- Company: [W. P. Carey Inc.](/companies/wpc.md) (CIK 1025378)
- Form: 10-Q
- Filed: 2025-04-30
- Accepted by EDGAR: Apr 30, 2025, 16:08 ET
- Period: 2025-03-31
- Accession: 0001025378-25-000064
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1025378/000102537825000064/wpc-20250331.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1025378/000102537825000064/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-01-01 to 2025-03-31 | $409.9m | us-gaap:Revenues |
| Interest expense | 3 months, 2025-01-01 to 2025-03-31 | $68.8m | us-gaap:InterestExpenseNonoperating |
| Income tax | 3 months, 2025-01-01 to 2025-03-31 | $11.6m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2025-01-01 to 2025-03-31 | $125.8m | us-gaap:NetIncomeLoss |
| Diluted shares (weighted) | 3 months, 2025-01-01 to 2025-03-31 | 220,720,310 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 3 months, 2025-01-01 to 2025-03-31 | $273.2m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Dividends paid | 3 months, 2025-01-01 to 2025-03-31 | $195.1m | us-gaap:PaymentsOfDividendsCommonStock |
| Cash and equivalents | at 2025-03-31 | $187.8m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Total assets | at 2025-03-31 | $17.31bn | us-gaap:Assets |
| Total liabilities | at 2025-03-31 | $8.94bn | us-gaap:Liabilities |
| Long-term debt | at 2025-03-31 | $7.87bn | us-gaap:LongTermDebt |
| Shareholders' equity | at 2025-03-31 | $8.36bn | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 46,486 characters.

Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to assist in understanding our financial statements and the reasons for changes in certain key components of our financial statements from period to period. This item also provides our perspective on our financial position and liquidity, as well as certain other factors that may affect our future results. Our Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the 2024 Annual Report and subsequent reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Refer to Item 1 of the 2024 Annual Report for a description of our business.

### Financial Highlights

During the three months ended March 31, 2025, we completed the following (as further described in the consolidated financial statements):

### Real Estate

#### Investments

- We acquired four investments totaling $268.2 million (Note 4, Note 5).
- We acquired a 47.50% ownership interest in the partnership that owns the Las Vegas Retail Complex for $5.0 million (Note 7). In addition, we funded approximately $1.2 million for a construction loan on this project during the three months ended March 31, 2025. Through March 31, 2025, we have funded $248.9 million (Note 7).
- We funded approximately $0.8 million for construction loans for retail projects in Las Vegas, Nevada, during the three months ended March 31, 2025. Through March 31, 2025, we have funded $32.7 million (Note 5).
- We committed to fund three construction projects totaling $45.2 million. We currently expect to complete these projects in 2025 and 2026 (Note 4).

#### Dispositions

- We disposed of nine properties for total proceeds, net of selling costs, of $126.7 million (Note 14).

### Financing and Capital Markets Transactions

- In February 2025, we repaid our $450 million of 4.000% Senior Notes due 2025 at maturity (Note 10).
- On March 31, 2025, we refinanced our €500.0 million Unsecured Term Loan due 2029, extending the maturity date by three years to April 2029. In conjunction with this refinancing, we executed variable-to-fixed interest rate swaps that fix the floating rate component of the per annum interest rate at 2.00% through the end of 2027, for a total annual interest rate of approximately 2.80% as of March 31, 2025 (inclusive of the current spread) (Note 10).
- On March 31, 2025, we executed variable-to-fixed interest rate swaps that fix the floating rate component of the per annum interest rate on our £270.0 million GBP Term Loan due 2028 at 3.92% through the end of 2027, for a total per annum interest rate of approximately 4.72% as of March 31, 2025 (inclusive of the current spread) (Note 10).
- We repaid non-recourse mortgage debt outstanding totaling $69.8 million with a weighted-average interest rate of 4.3% (Note 10).

### Dividends to Stockholders

In March 2025, we declared cash dividends totaling $0.890 per share (Note 12).

### Consolidated Results

#### (in thousands, except shares)

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| Total revenues | $409,858 | $389,798 |
| Net income attributable to W. P. Carey | 125,824 | 159,223 |
| Dividends declared | 196,598 | 190,947 |
| Net cash provided by operating activities (a) | 273,213 | 1,035,547 |
| Net cash used in investing activities | (173,870) | (236,972) |
| Net cash used in financing activities | (581,194) | (379,038) |
| Supplemental financial measures (b): |  |  |
| Adjusted funds from operations attributable to W. P. Carey (AFFO) | 257,820 | 251,892 |
| Diluted weighted-average shares outstanding | 220,720,310 | 220,129,870 |

(a) Amounts for the three months ended March 31, 2025 and 2024 include $16.3 million and $807.5 million, respectively, of proceeds from the sales of net investments in sales-type leases (U-Haul and State of Andalusia portfolios sold during the prior-year period) (Note 5). Such proceeds are included within Net cash provided by operating activities in accordance with ASC 842, *Leases.*

(b) We consider Adjusted funds from operations (“AFFO”), a supplemental measure that is not defined by GAAP (a “non-GAAP measure”), to be an important measure in the evaluation of our operating performance. See Supplemental Financial Measures below for our definition of this non-GAAP measure and a reconciliation to its most directly comparable GAAP measure.

#### Revenues

Total revenues increased for the three months ended March 31, 2025 as compared to the same period in 2024, primarily due to net investment activity and the impact of certain lease restructurings.

#### Net Income Attributable to W. P. Carey

Net income attributable to W. P. Carey decreased for the three months ended March 31, 2025 as compared to the same period in 2024, primarily due to higher losses from remeasurement of foreign debt and a higher non-cash allowance for credit loss on finance leases and loans receivable, partially offset by higher gain on sale of real estate.

#### AFFO

AFFO increased for the three months ended March 31, 2025 as compared to the same period in 2024, primarily due to the impact of net investment activity, rent escalations, and leasing activity, partially offset by lower interest income on cash deposits.

### Portfolio Overview

Our portfolio is comprised of operationally-critical, commercial real estate assets net leased to tenants located primarily in the United States and Northern and Western Europe. We invest in high-quality single tenant industrial, warehouse, and retail properties subject to long-term net leases with built-in rent escalators. Portfolio information is provided on a pro rata basis, unless otherwise noted below, to better illustrate the economic impact of our various net-leased jointly owned investments. See Terms and Definitions below for a description of pro rata amounts.

### Portfolio Summary

| Net-leased Properties | March 31, 2025 | December 31, 2024 |
| --- | ---: | ---: |
| ABR (in thousands) | $1,399,283 | $1,337,172 |
| Number of net-leased properties | 1,614 | 1,555 |
| Number of tenants | 366 | 355 |
| Total square footage (in thousands) | 176,739 | 176,420 |
| Occupancy | 98.3% | 98.6% |
| Weighted-average lease term (in years) | 12.3 | 12.3 |
| **Operating Properties** |  |  |
| Number of operating properties: | 84 | 84 |
| Number of self-storage operating properties | 78 | 78 |
| Number of hotel operating properties | 4 | 4 |
| Number of student housing operating properties | 2 | 2 |
| Occupancy (self-storage operating properties) | 89.0% | 89.6% |
| Number of countries | 26 | 26 |
| Total assets (in thousands) | $17,307,305 | $17,535,024 |
| Net investments in real estate (in thousands) | 14,839,486 | 14,580,475 |

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| Acquisition volume (in millions) (a) | $275.1 | $266.5 |
| Construction projects completed (in millions) | — | 14.7 |
| Average U.S. dollar/euro exchange rate | 1.0519 | 1.0858 |
| Average U.S. dollar/British pound sterling exchange rate | 1.2590 | 1.2681 |

(a) Amounts for the three months ended March 31, 2025 and 2024 include $1.2 million and $1.8 million, respectively, of funding for a construction loan accounted for as an equity investment (Note 7). Amount for the three months ended March 31, 2025 includes $5.0 million to acquire a 47.50% ownership interest in that equity investment (Note 7). Amount for the three months ended March 31, 2025 includes $0.8 million of funding for two construction loans accounted for as secured loans receivable (Note 5). Amounts for the three months ended March 31, 2025 and 2024 include $91.9 million and $83.9 million, respectively, of sale-leasebacks classified as loans receivable (Note 5).

### Net-Leased Portfolio

The tables below represent information about our net-leased portfolio at March 31, 2025 on a pro rata basis and, accordingly, exclude all operating properties. See Terms and Definitions below for a description of pro rata amounts and ABR.

#### Top Ten Tenants by ABR

#### (dollars in thousands)

| Tenant/Lease Guarantor | Description | Number of Properties | ABR | ABR Percent | Weighted-Average Lease Term (Years) |
| --- | --- | ---: | ---: | ---: | ---: |
| Extra Space Storage, Inc. | Net lease self-storage properties in the U.S. leased to publicly traded self-storage REIT | 39 | $37,640 | 2.7% | 24.4 |
| Apotex Pharmaceutical Holdings Inc. (a) | Pharmaceutical R&D and manufacturing properties in the Greater Toronto Area leased to generic drug manufacturer | 11 | 32,473 | 2.3% | 18.0 |
| Metro Cash & Carry Italia S.p.A. (b) | Business-to-business retail stores in Italy leased to cash and carry wholesaler | 19 | 28,391 | 2.0% | 4.9 |
| Fortenova Grupa d.d. (b) | Grocery stores and one warehouse in Croatia leased to European food retailer | 19 | 26,144 | 1.9% | 9.1 |
| Hellweg Die Profi-Baumärkte GmbH & Co. KG (b) (c) | Retail properties in Germany leased to German DIY retailer | 34 | 25,798 | 1.8% | 18.9 |
| OBI Group (b) | Retail properties in Poland leased to German DIY retailer | 26 | 25,258 | 1.8% | 6.1 |
| ABC Technologies Holdings Inc. (a) (d) | Automotive parts manufacturing properties in the U.S., Canada and Mexico leased to OEM supplier | 23 | 24,978 | 1.8% | 18.1 |
| Fedrigoni S.p.A (b) | Industrial and warehouse facilities in Germany, Italy and Spain leased to global manufacturer of premium packaging and labels | 16 | 23,100 | 1.7% | 18.7 |
| Nord Anglia Education, Inc. | K-12 private schools in Orlando, Miami and Houston leased to international day and boarding school operator | 3 | 22,963 | 1.6% | 18.5 |
| Eroski Sociedad Cooperativa (b) | Grocery stores and warehouses in Spain leased to Spanish food retailer | 63 | 21,972 | 1.6% | 11.0 |
|  |  | 253 | $268,717 | 19.2% | 15.2 |

(a) ABR from these properties is denominated in U.S. dollars.

(b) ABR amounts are subject to fluctuations in foreign currency exchange rates.

(c) On March 28, 2025, we executed an agreement giving us the right to terminate the leases at (i) seven properties on September 15, 2025 with ABR totaling $4.8 million and (ii) five properties on September 15, 2026 with ABR totaling $3.3 million.

(d) Of the 23 properties leased to ABC Technologies Holdings Inc., nine are located in Canada, eight are located in the United States, and six are located in Mexico.

#### Portfolio Diversification by Geography

#### (in thousands, except percentages)

| Region United States Midwest | ABR | ABR Percent | Square Footage (a) | Square Footage Percent |
| --- | ---: | ---: | ---: | ---: |
| Illinois | $62,855 | 4.5% | 9,945 | 5.6% |
| Ohio | 42,707 | 3.0% | 8,396 | 4.8% |
| Indiana | 39,507 | 2.8% | 6,162 | 3.5% |
| Michigan | 28,024 | 2.0% | 4,600 | 2.6% |
| Wisconsin | 19,568 | 1.4% | 3,340 | 1.9% |
| Other (b) | 51,326 | 3.7% | 7,227 | 4.1% |
| **Total Midwest** | 243,987 | 17.4% | 39,670 | 22.5% |
| **South** |  |  |  |  |
| Texas | 85,530 | 6.1% | 10,780 | 6.1% |
| Florida | 39,702 | 2.8% | 3,426 | 1.9% |
| Georgia | 25,279 | 1.8% | 4,378 | 2.5% |
| Tennessee | 24,602 | 1.8% | 4,004 | 2.3% |
| Alabama | 23,966 | 1.7% | 3,504 | 2.0% |
| Other (b) | 26,374 | 1.9% | 3,025 | 1.7% |
| **Total South** | 225,453 | 16.1% | 29,117 | 16.5% |
| **East** |  |  |  |  |
| North Carolina | 42,775 | 3.0% | 8,858 | 5.0% |
| Pennsylvania | 32,412 | 2.3% | 3,416 | 1.9% |
| Kentucky | 29,225 | 2.1% | 4,485 | 2.5% |
| New York | 22,555 | 1.6% | 2,284 | 1.3% |
| South Carolina | 19,694 | 1.4% | 4,485 | 2.5% |
| New Jersey | 19,053 | 1.4% | 955 | 0.6% |
| Massachusetts | 16,623 | 1.2% | 1,188 | 0.7% |
| Other (b) | 34,782 | 2.5% | 5,287 | 3.0% |
| **Total East** | 217,119 | 15.5% | 30,958 | 17.5% |
| **West** |  |  |  |  |
| California | 63,109 | 4.5% | 5,137 | 2.9% |
| Arizona | 22,114 | 1.6% | 2,372 | 1.3% |
| Nevada | 17,578 | 1.3% | 485 | 0.3% |
| Utah | 14,700 | 1.0% | 2,021 | 1.1% |
| Other (b) | 51,571 | 3.7% | 4,720 | 2.7% |
| **Total West** | 169,072 | 12.1% | 14,735 | 8.3% |
| **United States Total** | 855,631 | 61.1% | 114,480 | 64.8% |
| **International** |  |  |  |  |
| The Netherlands | 62,349 | 4.5% | 6,917 | 3.9% |
| Poland | 60,778 | 4.3% | 8,460 | 4.8% |
| Italy | 59,871 | 4.3% | 8,183 | 4.6% |
| Canada (c) | 54,144 | 3.9% | 5,449 | 3.1% |
| Germany | 50,872 | 3.6% | 5,795 | 3.3% |
| United Kingdom | 50,768 | 3.6% | 4,412 | 2.5% |
| Spain | 36,375 | 2.6% | 3,073 | 1.7% |
| Croatia | 26,992 | 1.9% | 2,063 | 1.2% |
| Denmark | 25,433 | 1.8% | 3,002 | 1.7% |
| France | 23,043 | 1.7% | 1,679 | 1.0% |
| Mexico (d) | 21,716 | 1.6% | 3,604 | 2.0% |
| Other (e) | 71,311 | 5.1% | 9,622 | 5.4% |
| **International Total** | 543,652 | 38.9% | 62,259 | 35.2% |
| **Total** | $1,399,283 | 100.0% | 176,739 | 100.0% |

*W. P. Carey 3/31/2025 10-Q –* **35**

#### Portfolio Diversification by Property Type

#### (in thousands, except percentages)

| Property Type | ABR | ABR Percent | Square Footage (a) | Square Footage Percent |
| --- | ---: | ---: | ---: | ---: |
| Industrial | $512,062 | 36.6% | 77,414 | 43.8% |
| Warehouse | 370,520 | 26.5% | 65,585 | 37.1% |
| Retail (f) | 314,405 | 22.5% | 22,387 | 12.7% |
| Other (g) | 202,296 | 14.4% | 11,353 | 6.4% |
| **Total** | $1,399,283 | 100.0% | 176,739 | 100.0% |

(a) Includes square footage for any vacant properties.

(b) Other properties within Midwest include assets in Minnesota, Iowa, Kansas, Missouri, Nebraska, South Dakota, and North Dakota. Other properties within South include assets in Arkansas, Louisiana, Oklahoma, and Mississippi. Other properties within East include assets in Virginia, Maryland, Connecticut, West Virginia, New Hampshire, and Maine. Other properties within West include assets in Oregon, Colorado, Washington, Montana, Hawaii, Idaho, Wyoming, and New Mexico.

(c) $48.9 million (90%) of ABR from properties in Canada is denominated in U.S. dollars, with the balance denominated in Canadian dollars.

(d) All ABR from properties in Mexico is denominated in U.S. dollars.

(e) Includes assets in Lithuania, Belgium, Hungary, Norway, Mauritius, Slovakia, Portugal, the Czech Republic, Austria, Sweden, Latvia, Japan, Finland, and Estonia.

(f) Includes automotive dealerships.

(g) Includes ABR from tenants within the following property types: education facility, specialty, self-storage (net lease), laboratory, research and development, hotel (net lease), office, and land.

#### Portfolio Diversification by Tenant Industry

#### (in thousands, except percentages)

| Industry Type (a) | ABR | ABR Percent | Square Footage | Square Footage Percent |
| --- | ---: | ---: | ---: | ---: |
| Food Retail | $139,931 | 10.0% | 11,744 | 6.7% |
| Packaged Foods & Meats | 113,745 | 8.1% | 14,962 | 8.5% |
| Home Improvement Retail | 99,412 | 7.1% | 13,021 | 7.4% |
| Auto Parts & Equipment | 78,286 | 5.6% | 11,941 | 6.8% |
| Automotive Retail | 74,617 | 5.3% | 7,038 | 4.0% |
| Education Services | 59,066 | 4.2% | 2,778 | 1.6% |
| Pharmaceuticals | 46,863 | 3.3% | 3,076 | 1.7% |
| Air Freight & Logistics | 42,850 | 3.1% | 7,075 | 4.0% |
| Trading Companies & Distributors | 42,526 | 3.0% | 9,780 | 5.5% |
| Self-Storage REITs | 37,640 | 2.7% | 2,824 | 1.6% |
| Diversified Support Services | 35,475 | 2.5% | 3,266 | 1.9% |
| Building Products | 35,011 | 2.5% | 7,643 | 4.3% |
| Other Specialty Retail | 31,710 | 2.3% | 3,936 | 2.2% |
| Industrial Machinery | 31,181 | 2.2% | 5,045 | 2.9% |
| Metal & Glass Containers | 30,208 | 2.2% | 4,301 | 2.4% |
| Construction Materials | 23,123 | 1.7% | 3,781 | 2.1% |
| Paper Products | 23,100 | 1.7% | 4,458 | 2.5% |
| Construction Machinery | 18,405 | 1.3% | 2,528 | 1.4% |
| Leisure Facilities | 17,583 | 1.3% | 645 | 0.4% |
| Diversified Metals | 16,992 | 1.2% | 3,622 | 2.1% |
| Consumer Staples Merchandise Retail | 16,924 | 1.2% | 1,456 | 0.8% |
| Specialized Consumer Services | 16,305 | 1.2% | 571 | 0.3% |
| Commodity Chemicals | 16,133 | 1.2% | 2,493 | 1.4% |
| Specialty Chemicals | 15,773 | 1.1% | 2,725 | 1.5% |
| Hotels & Resorts | 15,473 | 1.1% | 1,073 | 0.6% |
| Other (62 industries, each \<1% ABR) (b) | 320,951 | 22.9% | 44,957 | 25.4% |
| **Total** | $1,399,283 | 100.0% | 176,739 | 100.0% |

(a) Industry classification is based on the Global Industry Classification Standard (GICS) framework.

(b) Includes square footage for vacant properties.

#### Lease Expirations

#### (in thousands, except percentages, number of leases, and number of tenants)

| Year of Lease Expiration (a) | Number of Leases Expiring | Number of Tenants with Leases Expiring | ABR | ABR Percent | Square Footage | Square Footage Percent |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Remaining 2025 | 14 | 12 | $17,456 | 1.3% | 2,458 | 1.4% |
| 2026 | 25 | 24 | 40,847 | 2.9% | 5,959 | 3.4% |
| 2027 | 45 | 28 | 63,900 | 4.6% | 7,236 | 4.1% |
| 2028 | 44 | 27 | 59,162 | 4.2% | 5,340 | 3.0% |
| 2029 | 59 | 32 | 73,378 | 5.2% | 8,484 | 4.8% |
| 2030 | 35 | 30 | 38,875 | 2.8% | 3,874 | 2.2% |
| 2031 | 44 | 25 | 83,715 | 6.0% | 10,112 | 5.7% |
| 2032 | 45 | 24 | 47,809 | 3.4% | 6,080 | 3.4% |
| 2033 | 32 | 25 | 81,215 | 5.8% | 11,790 | 6.7% |
| 2034 | 59 | 27 | 90,878 | 6.5% | 9,464 | 5.3% |
| 2035 | 22 | 18 | 39,787 | 2.8% | 7,045 | 4.0% |
| 2036 | 45 | 20 | 76,370 | 5.5% | 10,865 | 6.1% |
| 2037 | 41 | 18 | 45,625 | 3.3% | 6,826 | 3.9% |
| 2038 | 47 | 14 | 26,883 | 1.9% | 2,806 | 1.6% |
| Thereafter (\>2038) | 351 | 122 | 613,383 | 43.8% | 75,463 | 42.7% |
| Vacant | — | — | — | —% | 2,937 | 1.7% |
| **Total** | 908 |  | $1,399,283 | 100.0% | 176,739 | 100.0% |

(a) Assumes tenants do not exercise any renewal options or purchase options.

### Terms and Definitions

*Pro Rata Metrics —* The portfolio information above contains certain metrics prepared on a pro rata basis. We refer to these metrics as pro rata metrics. We have certain investments in which our economic ownership is less than 100%. On a full consolidation basis, we report 100% of the assets, liabilities, revenues, and expenses of those investments that are deemed to be under our control or for which we are deemed to be the primary beneficiary, even if our ownership is less than 100%. Also, for all other jointly owned investments, which we do not control, we report our net investment and our net income or loss from that investment. On a pro rata basis, we generally present our proportionate share, based on our economic ownership of these jointly owned investments, of the portfolio metrics of those investments. Multiplying each of our jointly owned investments’ financial statement line items by our percentage ownership and adding or subtracting those amounts from our totals, as applicable, may not accurately depict the legal and economic implications of holding an ownership interest of less than 100% in our jointly owned investments.

*ABR —* ABR represents contractual minimum annualized base rent for our net-leased properties and reflects exchange rates as of March 31, 2025. If there is a rent abatement, we annualize the first monthly contractual base rent following the free rent period. ABR is not applicable to operating properties and is presented on a pro rata basis.

### Results of Operations

We evaluate our results of operations with a primary focus on increasing and enhancing the value, quality, and number of our properties. We focus our efforts on accretive investing and improving portfolio quality through re-leasing efforts, including negotiation of lease renewals, or selectively selling assets in order to increase value in our real estate portfolio.

### Revenues

The following table presents revenues (in thousands):

| Real Estate Revenues Lease revenues from: | Three Months Ended March 31, 2025 | 2024 | Change |
| --- | ---: | ---: | ---: |
| Existing net-leased properties | $326,105 | $309,564 | $16,541 |
| Recently acquired net-leased properties | 26,628 | 2,912 | 23,716 |
| Net-leased properties sold or held for sale | 1,035 | 9,775 | (8,740) |
| Total lease revenues (includes reimbursable tenant costs) | 353,768 | 322,251 | 31,517 |
| Income from finance leases and loans receivable | 17,458 | 25,793 | (8,335) |
| Operating property revenues from: |  |  |  |
| Existing operating properties | 32,932 | 33,967 | (1,035) |
| Recently acquired operating properties | 162 | — | 162 |
| Operating properties sold or reclassified to net-leased properties | — | 2,676 | (2,676) |
| Total operating property revenues | 33,094 | 36,643 | (3,549) |
| Other lease-related income | 3,121 | 2,155 | 966 |
| **Investment Management Revenues** |  |  |  |
| Asset management revenue | 1,350 | 1,893 | (543) |
| Other advisory income and reimbursements | 1,067 | 1,063 | 4 |
|  | $409,858 | $389,798 | $20,060 |

#### Lease Revenues

“Existing net-leased properties” are those that we acquired or placed into service prior to January 1, 2024 and that were not sold or held for sale during the periods presented. For the periods presented, there were 1,165 existing net-leased properties.

For the three months ended March 31, 2025 as compared to the same period in 2024, lease revenues from existing net-leased properties increased due to the following items (in millions):

(a) During the first quarter of 2024, we entered into a lease restructuring with our tenant Hellweg, which included (i) abated rent from January 1, 2024 to March 31, 2024 and (ii) a reduction in annual base rent.

(b) Includes (i) lease revenues of $2.6 million from 12 self-storage operating properties that were converted to net leases on September 1, 2024 and (ii) an increase in lease revenues of $0.8 million as a result of a lease restructuring for 27 existing net-leased self-storage properties that was executed on September 1, 2024.

(c) Excludes fixed minimum rent increases, which are reflected as straight-line rent adjustments within lease revenues.

“Recently acquired net-leased properties” are those that we acquired or placed into service subsequent to December 31, 2023 and that were not sold or held for sale during the periods presented. Since January 1, 2024, we acquired 28 investments (comprised of 335 properties).

“Net-leased properties sold or held for sale” include:

- Nine net-leased properties disposed of during the three months ended March 31, 2025;
- three net-leased properties classified as held for sale at March 31, 2025 (Note 4), all of which were sold in April 2025 (Note 15); and
- 175 net-leased properties disposed of during the year ended December 31, 2024.

Our dispositions are more fully described in Note 14.

#### Income from Finance Leases and Loans Receivable

For the three months ended March 31, 2025 as compared to the same period in 2024, income from finance leases and loans receivable decreased due to the following items (in millions):

(a) We sold our U-Haul and State of Andalusia portfolios during the first quarter of 2024. Such investments were previously reclassified to net investments in sales-type leases during 2023.

#### Operating Property Revenues and Expenses

“Existing operating properties” are those that we acquired or placed into service prior to January 1, 2024 and that were not sold, held for sale, or reclassified to net-leased properties during the periods presented. For the periods presented, we recorded operating property revenues from 83 existing operating properties, comprised of 77 self-storage operating properties, four hotel operating properties, and two student housing operating properties.

“Recently acquired operating properties” include one self-storage operating property acquired during the third quarter of 2024.

“Operating properties sold or reclassified to net-leased properties” are comprised of (i) one hotel operating property sold during the second quarter of 2024 and (ii) three self-storage operating properties that were reclassified to net-leased properties during the third quarter of 2024.

#### Other Lease-Related Income

Other lease-related income is described in Note 4.

#### Asset Management Revenue

During the periods presented, we earned asset management revenue from (i) NLOP and (ii) CESH (Note 3). Asset management revenues from NLOP and CESH are expected to decline as assets are sold (CESH owns one remaining build-to-suit project).

#### Other Advisory Income and Reimbursements

Other advisory income and reimbursements are comprised of (i) fixed administrative fees earned from NLOP and (ii) reimbursable costs from CESH (Note 3).

### Operating Expenses

#### Depreciation and Amortization

For the three months ended March 31, 2025 as compared to the same period in 2024, depreciation and amortization expense increased primarily due to the impact of property acquisition activity.

#### General and Administrative

For the three months ended March 31, 2025 as compared to the same period in 2024, general and administrative expenses decreased by $0.9 million, primarily due to lower professional fees.

#### Impairment Charges — Real Estate

Our impairment charges on real estate are more fully described in Note 8.

#### Merger and Other Expenses

For the three months ended March 31, 2024, merger and other expenses are primarily comprised of the write-off of a value added tax receivable that was previously recorded in connection with an international investment.

### Other Income and Expenses, and Provision for Income Taxes

#### Interest Expense

For the three months ended March 31, 2025 as compared to the same period in 2024, interest expense increased by $0.2 million, primarily due to higher outstanding balances and interest rates on our Senior Unsecured Notes, partially offset by (i) lower interest rates on our Unsecured Term Loans, (ii) the reduction of our mortgage debt outstanding by prepaying or repaying at or close to maturity a total of $284.8 million of non-recourse mortgage loans with a weighted-average interest rate of 4.4% since January 1, 2024 (Note 10), and (iii) lower outstanding balances on our Unsecured Revolving Credit Facility.

The following table presents certain information about our outstanding debt (dollars in thousands):

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| Average outstanding debt balance | $7,980,685 | $7,932,176 |
| Weighted-average interest rate | 3.2% | 3.2% |

*W. P. Carey 3/31/2025 10-Q –* **41**

#### Gain on Sale of Real Estate, Net

Gain on sale of real estate, net, consists of gains and losses on the sale of properties that were (i) disposed of, (ii) subject to the exercise of a purchase option, or (iii) subject to a purchase agreement resulting in a lease modification during the reporting period, as more fully described in Note 4, Note 5 and Note 14.

#### Other Gains and (Losses)

Other gains and (losses) primarily consists of gains and losses on (i) the mark-to-market fair value of equity securities, (ii) extinguishment of debt, (iii) foreign currency exchange rate movements (except those foreign currency-denominated unsecured debt instruments that were designated as net investment hedges (Note 9)), and (iv) changes in the non-cash allowance for credit losses on loans receivable and finance leases. The timing and amount of such gains or losses cannot always be estimated and are subject to fluctuation.

The following table presents other gains and (losses) (in thousands):

| Other Gains and (Losses) | Three Months Ended March 31, 2025 | 2024 | Change |
| --- | ---: | ---: | ---: |
| Net realized and unrealized losses on foreign currency exchange rate movements (a) | $(27,935) | $(1,107) | $(26,828) |
| Change in allowance for credit losses on finance receivables (Note 5) | (12,331) | 4,003 | (16,334) |
| Non-cash unrealized (losses) gains on non-hedging derivatives | (1,740) | 492 | (2,232) |
| Gain on repayment of secured loan receivable (b) | — | 10,650 | (10,650) |
| Other | (191) | (199) | 8 |
|  | $(42,197) | $13,839 | $(56,036) |

(a) Remeasurement of certain monetary assets and liabilities that are held by our subsidiaries in currencies other than their functional currency are included in other gains and (losses), including certain foreign currency-denominated unsecured debt instruments that are not designated as net investment hedges. This includes foreign currency-denominated intercompany loans to our foreign subsidiaries that are scheduled for settlement. Beginning in the first quarter of 2023, our intercompany loans subject to remeasurement were hedged by certain of our foreign currency-denominated unsecured debt that we de-designated as net investment hedges.

(b) We acquired a secured loan receivable with a fair value of $13.3 million in our merger with a former affiliate, Corporate Property Associates 17 – Global Incorporated, in October 2018, for which the outstanding principal of $24.0 million was fully repaid to us in March 2024 (Note 5). Therefore, we recorded a $10.7 million gain on repayment of this secured loan receivable during the three months ended March 31, 2024.

#### Non-Operating Income

Non-operating income primarily consists of interest income on our cash deposits, realized gains and losses on derivative instruments, and dividends from equity securities.

The following table presents non-operating income (in thousands):

| Non-Operating Income | Three Months Ended March 31, 2025 | 2024 | Change |
| --- | ---: | ---: | ---: |
| Dividends from our investment in Lineage (Note 8) | $2,755 | $3,032 | $(277) |
| Interest income on our cash deposits (a) | 2,596 | 9,356 | (6,760) |
| Realized gains on foreign currency collars (Note 9) | 2,559 | 3,117 | (558) |
|  | $7,910 | $15,505 | $(7,595) |

(a) Decrease for the three months ended March 31, 2025 as compared to the same period in 2024 is due to lower cash deposit balances as a result of investment activity and debt repayments.

#### Earnings from Equity Method Investments

Our equity method investments are more fully described in Note 7. The following table presents earnings from equity method investments (in thousands):

| Earnings from Equity Method Investments | Three Months Ended March 31, 2025 | 2024 | Change |
| --- | ---: | ---: | ---: |
| Earnings from Las Vegas Retail Complex (a) | $4,301 | $3,095 | $1,206 |
| Earnings from Kesko Senukai | 862 | 417 | 445 |
| Earnings from Harmon Retail Center | 215 | 216 | (1) |
| Earnings from Johnson Self Storage (b) | — | 1,136 | (1,136) |
|  | $5,378 | $4,864 | $514 |

(a) Increase is due to (i) funding of the construction loan portion of this investment since January 1, 2024, which has an interest rate of 6.0%, and (ii) the acquisition of a 47.50% equity interest in the partnership that owns this investment on February 27, 2025 (Note 7).

(b) On September 1, 2024, we acquired the remaining 10% controlling interest in the Johnson Self Storage jointly owned investment, bringing our ownership interest to 100%. Following this acquisition, we no longer recognize equity income from this consolidated investment.

#### Provision for Income Taxes

For the three months ended March 31, 2025 as compared to the same period in 2024, provision for income taxes increased by $3.0 million, primarily due to higher current taxes and a deferred tax benefit recognized during the prior year period, both as a result of an international lease restructuring.

### Liquidity and Capital Resources

### Sources and Uses of Cash During the Period

We use the cash flow generated from our investments primarily to meet our operating expenses, service debt, and fund dividends to stockholders. Our cash flows fluctuate periodically due to a number of factors, which may include, among other things: the timing of our equity and debt offerings; the timing of purchases and sales of real estate; the timing of the repayment of mortgage loans, our Senior Unsecured Notes, and our Unsecured Term Loans; the timing of our receipt of lease revenues; the timing and amount of other lease-related payments; the timing of settlement of foreign currency transactions; changes in foreign currency exchange rates; and the timing of distributions from equity method investments. Despite these fluctuations, we believe that we will generate sufficient cash from operations to meet our normal recurring short-term liquidity needs. We may also use existing cash resources, available capacity under our Senior Unsecured Credit Facility, proceeds from term loans or other bank debt, proceeds from dispositions of properties, and the issuance of additional debt or equity securities, such as issuances of common stock through our ATM Program (Note 12), in order to meet our short-term and long-term liquidity needs. We assess our ability to access capital on an ongoing basis. Our sources and uses of cash during the period are described below.

*Operating Activities —* Net cash provided by operating activities decreased by $762.3 million during the three months ended March 31, 2025 as compared to the same period in 2024, primarily due to $807.5 million of proceeds received from the sales of net investments in sales-types leases during the prior year period (Note 5), partially offset by an increase in cash flow generated from net investment activity, scheduled rent increases at existing properties, and leasing activity.

*Investing Activities —* Our investing activities are generally comprised of real estate-related transactions (purchases and sales) and funding for build-to-suit activities and other capital expenditures on real estate.

*Financing Activities —* Our financing activities are generally comprised of borrowings and repayments under our Unsecured Revolving Credit Facility and Unsecured Term Loans, issuances and repayments of the Senior Unsecured Notes, payments of non-recourse mortgage loans, issuances of common equity, and payments of dividends to stockholders.

### Summary of Financing

The table below summarizes our Senior Unsecured Notes, our non-recourse mortgages, and our Senior Unsecured Credit Facility (dollars in thousands):

| Carrying Value Fixed rate: | March 31, 2025 | December 31, 2024 |
| --- | ---: | ---: |
| Senior Unsecured Notes, net (a) | $6,211,918 | $6,505,907 |
| Unsecured Term Loans, net subject to interest rate swaps (a) | 882,635 | 517,524 |
| Non-recourse mortgages, net (a) (b) | 335,345 | 401,821 |
|  | 7,429,898 | 7,425,252 |
| Variable rate: |  |  |
| Unsecured Term Loans, net (a) | 231,275 | 558,302 |
| Unsecured Revolving Credit Facility | 205,129 | 55,448 |
|  | 436,404 | 613,750 |
|  | $7,866,302 | $8,039,002 |
| **Percent of Total Debt** |  |  |
| Fixed rate | 94% | 92% |
| Variable rate | 6% | 8% |
|  | 100% | 100% |
| **Weighted-Average Interest Rate at End of Period** |  |  |
| Fixed rate | 3.1% | 3.2% |
| Variable rate | 3.9% | 4.7% |
| Total debt | 3.1% | 3.3% |

(a) Aggregate debt balance includes unamortized discount, net, totaling $41.4 million and $39.3 million as of March 31, 2025 and December 31, 2024, respectively, and unamortized deferred financing costs totaling $30.3 million and $30.9 million as of March 31, 2025 and December 31, 2024, respectively.

(b) Includes non-recourse mortgages subject to variable-to-fixed interest rate swaps totaling $44.4 million and $43.5 million as of March 31, 2025 and December 31, 2024, respectively.

### Cash Resources

At March 31, 2025, our cash resources consisted of the following:

- cash and cash equivalents totaling $187.8 million. Of this amount, $149.9 million, at then-current exchange rates, was held in foreign subsidiaries, and we could be subject to restrictions or significant costs should we decide to repatriate these amounts;
- our Unsecured Revolving Credit Facility, with available capacity of approximately $1.8 billion (net of amounts reserved for standby letters of credit totaling $4.9 million); and
- unleveraged properties that had an aggregate asset carrying value of approximately $14.1 billion at March 31, 2025, although there can be no assurance that we would be able to obtain financing for these properties.

We may also access the capital markets through additional debt (denominated in both U.S. dollars and euros) and equity offerings, as well as term loans and other bank debt.

Our cash resources can be used for working capital needs and other commitments and may be used for future investments.

### Cash Requirements and Liquidity

As of March 31, 2025, we had (i) $187.8 million of cash and cash equivalents and (ii) approximately $1.8 billion of available capacity under our Unsecured Revolving Credit Facility (net of amounts reserved for standby letters of credit totaling $4.9 million). As of March 31, 2025, scheduled debt principal payments total $150.9 million during the remainder of 2025 and $1.0 billion during 2026 (Note 10).

During the next 12 months following March 31, 2025 and thereafter, we expect that our significant cash requirements will include:

- paying dividends to our stockholders;
- funding acquisitions of new investments (Note 4);
- funding future capital commitments (Note 4) and tenant improvement allowances;
- making scheduled principal and balloon payments on our debt obligations
- making scheduled interest payments on our debt obligations (future interest payments total $1.3 billion, with $245.1 million due during the next 12 months; interest on unhedged variable-rate debt obligations was calculated using the applicable annual variable interest rates and balances outstanding at March 31, 2025); and
- other normal recurring operating expenses.

We expect to fund these cash requirements through cash generated from operations, cash received from dispositions of properties, the use of our cash reserves or unused amounts on our Unsecured Revolving Credit Facility (as described above), proceeds from term loans or other bank debt, issuances of common stock through our ATM Program (Note 12), and potential issuances of additional debt or equity securities.

Our liquidity could be adversely affected by an unanticipated disruption to our operating cash flow, which could include interrupted rent collections or greater-than-anticipated operating expenses. To the extent that our working capital reserve is insufficient to satisfy our cash requirements, additional funds may be provided from cash from operations to meet our normal recurring short-term and long-term liquidity needs. We may also use existing cash resources, available capacity under our Unsecured Revolving Credit Facility, mortgage loan proceeds, and the issuance of additional debt or equity securities to meet these needs.

Certain amounts disclosed above are based on the applicable foreign currency exchange rate at March 31, 2025.

### Supplemental Financial Measures

In the real estate industry, analysts and investors employ certain non-GAAP supplemental financial measures in order to facilitate meaningful comparisons between periods and among peer companies. Additionally, in the formulation of our goals and in the evaluation of the effectiveness of our strategies, we use Funds from Operations (“FFO”) and AFFO, which are non-GAAP measures defined by our management. We believe that these measures are useful to investors to consider because they may assist them to better understand and measure the performance of our business over time and against similar companies. A description of FFO and AFFO and reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are provided below.

#### Funds from Operations and Adjusted Funds from Operations

Due to certain unique operating characteristics of real estate companies, as discussed below, the National Association of Real Estate Investment Trusts (“NAREIT”), an industry trade group, has promulgated a non-GAAP measure known as FFO, which we believe to be an appropriate supplemental measure, when used in addition to and in conjunction with results presented in accordance with GAAP, to reflect the operating performance of a REIT. The use of FFO is recommended by the REIT industry as a supplemental non-GAAP measure. FFO is not equivalent to, nor a substitute for, net income or loss as determined under GAAP.

We define FFO, a non-GAAP measure, consistent with the standards established by the White Paper on FFO approved by the Board of Governors of NAREIT, as restated in December 2018. The White Paper defines FFO as net income or loss computed in accordance with GAAP, excluding gains or losses from the sale of certain real estate, impairment charges on real estate or other assets incidental to the company’s main business, gains or losses on changes in control of interests in real estate, and depreciation and amortization from real estate assets; and after adjustments for unconsolidated partnerships and jointly owned investments. Adjustments for unconsolidated partnerships and jointly owned investments are calculated to reflect FFO on the same basis.

We also modify the NAREIT computation of FFO to adjust GAAP net income for certain non-cash charges, such as amortization of real estate-related intangibles, deferred income tax benefits and expenses, straight-line rent and related reserves, other non-cash rent adjustments, non-cash allowance for credit losses on loans receivable and finance leases, stock-based compensation, non-cash environmental accretion expense, amortization of discounts and premiums on debt, and amortization of deferred financing costs. Our assessment of our operations is focused on long-term sustainability and not on such non-cash items, which may cause short-term fluctuations in net income but have no impact on cash flows. Additionally, we exclude non-core income and expenses, such as gains or losses from extinguishment of debt, gains or losses on the mark-to-market fair value of equity securities, merger and acquisition expenses, and spin-off expenses. We also exclude realized and unrealized gains/losses on foreign currency exchange rate movements (other than those realized on the settlement of foreign currency derivatives), which are not considered fundamental attributes of our business plan and do not affect our overall long-term operating performance. We refer to our modified definition of FFO as AFFO. We exclude these items from GAAP net income to arrive at AFFO as they are not the primary drivers in our decision-making process and excluding these items provides investors a view of our portfolio performance over time and makes it more comparable to other REITs. AFFO also reflects adjustments for unconsolidated partnerships and jointly owned investments. We use AFFO as one measure of our operating performance when we formulate corporate goals, evaluate the effectiveness of our strategies, and determine executive compensation.

We believe that AFFO is a useful supplemental measure for investors to consider as we believe it will help them to better assess the sustainability of our operating performance without the potentially distorting impact of these short-term fluctuations. However, there are limits on the usefulness of AFFO to investors. For example, impairment charges and unrealized foreign currency exchange rate losses that we exclude may become actual realized losses upon the ultimate disposition of the properties in the form of lower cash proceeds or other considerations. We use our FFO and AFFO measures as supplemental financial measures of operating performance. We do not use our FFO and AFFO measures as, nor should they be considered to be, alternatives to net income computed under GAAP, or as alternatives to net cash provided by operating activities computed under GAAP, or as indicators of our ability to fund our cash needs.

FFO and AFFO were as follows (in thousands):

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| Net income attributable to W. P. Carey | $125,824 | $159,223 |
| Adjustments: |  |  |
| Depreciation and amortization of real property | 128,937 | 118,113 |
| Gain on sale of real estate, net | (43,777) | (15,445) |
| Impairment charges — real estate | 6,854 | — |
| Proportionate share of adjustments to earnings from equity method investments (a) | 1,643 | 2,949 |
| Proportionate share of adjustments for noncontrolling interests (b) | (78) | (103) |
| Total adjustments | 93,579 | 105,514 |
| FFO (as defined by NAREIT) attributable to W. P. Carey | 219,403 | 264,737 |
| Adjustments: |  |  |
| Other (gains) and losses (c) | 42,197 | (13,839) |
| Straight-line and other leasing and financing adjustments | (19,033) | (19,553) |
| Stock-based compensation | 9,148 | 8,856 |
| Amortization of deferred financing costs | 4,782 | 4,588 |
| Above- and below-market rent intangible lease amortization, net | 1,123 | 4,068 |
| Tax benefit — deferred and other | (782) | (1,373) |
| Other amortization and non-cash items | 560 | 579 |
| Merger and other expenses (d) | 556 | 4,452 |
| Proportionate share of adjustments to earnings from equity method investments (a) | (86) | (519) |
| Proportionate share of adjustments for noncontrolling interests (b) | (48) | (104) |
| Total adjustments | 38,417 | (12,845) |
| AFFO attributable to W. P. Carey | $257,820 | $251,892 |
| **Summary** |  |  |
| FFO (as defined by NAREIT) attributable to W. P. Carey | $219,403 | $264,737 |
| AFFO attributable to W. P. Carey | $257,820 | $251,892 |

(a) Equity income, including amounts that are not typically recognized for FFO and AFFO, is recognized within Earnings from equity method investments on the consolidated statements of income. This represents adjustments to equity income to reflect FFO and AFFO on a pro rata basis.

(b) Adjustments disclosed elsewhere in this reconciliation are on a consolidated basis. This adjustment reflects our FFO or AFFO on a pro rata basis.

(c) Primarily comprised of gains and losses on extinguishment of debt, the mark-to-market fair value of equity securities, foreign currency exchange rate movements, and changes in the non-cash allowance for credit losses on loans receivable and finance leases.

(d) Amount for the three months ended March 31, 2024 is primarily comprised of the write-off of a value added tax receivable that was previously recorded in connection with an international investment.

While we believe that FFO and AFFO are important supplemental measures, they should not be considered as alternatives to net income as an indication of a company’s operating performance. These non-GAAP measures should be used in conjunction with net income as defined by GAAP. FFO and AFFO, or similarly titled measures disclosed by other REITs, may not be comparable to our FFO and AFFO measures.

## Market risk

As filed, 6,633 characters.

#### Market Risk

Market risk is the exposure to loss resulting from changes in interest rates, foreign currency exchange rates, and equity prices. The primary market risks that we are exposed to are interest rate risk and foreign currency exchange risk; however, we do not use derivative instruments to hedge credit/market risks or for speculative purposes.

We are also exposed to further market risk as a result of tenant concentrations in certain industries and/or geographic regions, since adverse market factors can affect the ability of tenants in a particular industry/region to meet their respective lease obligations. In order to manage this risk, we view our collective tenant roster as a portfolio and we attempt to diversify such portfolio so that we are not overexposed to a particular industry or geographic region.

#### Interest Rate Risk

The values of our real estate and related fixed-rate debt obligations, as well as the values of our unsecured debt obligations, are subject to fluctuations based on changes in interest rates. The value of our real estate is also subject to fluctuations based on local and regional economic conditions and changes in the creditworthiness of lessees, which may affect our ability to refinance property-level mortgage debt when balloon payments are scheduled, if we do not choose to repay the debt when due. Interest rates are highly sensitive to many factors, including governmental monetary and tax policies, domestic and international economic and political conditions, and other factors beyond our control. An increase in interest rates would likely cause the fair value of our assets to decrease. Increases in interest rates may also have an impact on the credit profile of certain tenants.

We are exposed to the impact of interest rate changes primarily through our borrowing activities. To limit this exposure, we generally seek long-term debt financing on a fixed-rate basis. However, we are subject to variable-rate interest on our Unsecured Term Loans and Unsecured Revolving Credit Facility. We have entered into, and may continue to enter into, interest rate swap agreements or interest rate cap agreements with counterparties related to certain of our variable-rate debt (Note 10). See Note 9 for additional information on our interest rate swaps and caps.

Our debt obligations are more fully described in Note 10 and Liquidity and Capital Resources — Summary of Financing in Item 2 above. The following table presents principal cash flows based upon expected maturity dates of our debt obligations outstanding at March 31, 2025 (in thousands):

|  | 2025 (Remainder) | 2026 | 2027 | 2028 | 2029 | Thereafter | Total | Fair Value |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Fixed-rate debt (a) (b) | $150,934 | $981,716 | $550,697 | $963,093 | $1,039,675 | $3,814,150 | $7,500,265 | $7,079,107 |
| Variable-rate debt (a) | $— | $— | $— | $232,523 | $205,129 | $— | $437,652 | $469,112 |

(a) Amounts are based on the exchange rate at March 31, 2025, as applicable.

(b) Amounts include non-recourse mortgages and unsecured term loans subject to variable-to-fixed interest rate swaps. Amounts are primarily comprised of principal payments for our Senior Unsecured Notes (Note 10).

The estimated fair value of our fixed-rate debt and our variable-rate debt is affected by changes in interest rates. Annual interest expense on our unhedged variable-rate debt that does not bear interest at fixed rates at March 31, 2025 would increase or decrease by $2.3 million for our euro-denominated debt, by $1.9 million for our U.S. dollar-denominated debt, and by $0.2 million for our Japanese yen-denominated debt, for each respective 1% change in annual interest rates.

#### Foreign Currency Exchange Rate Risk

We own international investments, primarily in Europe, Canada, and Japan, and as a result are subject to risk from the effects of exchange rate movements in various foreign currencies, primarily the euro, the British pound sterling, the Danish krone, the Canadian dollar, the Japanese yen, and certain other currencies which may affect future costs and cash flows. We have obtained, and may in the future obtain, non-recourse mortgage financing in the local currency. We have also completed several offerings of euro-denominated senior notes, and have borrowed under our Senior Unsecured Credit Facility and Unsecured Term Loan due 2029 in foreign currencies, including the euro, British pound sterling, and Japanese yen (Note 10). Volatile market conditions arising from certain macroeconomic factors may result in significant fluctuations in foreign currency exchange rates. To the extent that currency fluctuations increase or decrease rental revenues, as translated to U.S. dollars, the change in debt service (comprised of principal and interest, excluding balloon payments), as translated to U.S. dollars, will partially offset the effect of fluctuations in revenue and, to some extent, mitigate the risk from changes in foreign currency exchange rates. We estimate that, for a 1% increase or decrease in the exchange rate between the euro, British pound sterling, or Danish krone and the U.S. dollar, there would be a corresponding change in the projected estimated cash flow (scheduled future rental revenues, net of scheduled future debt service payments for the next 12 months) for our consolidated foreign operations at March 31, 2025 of $2.1 million, $0.3 million, and $0.2 million, respectively, excluding the impact of our derivative instruments.

In addition, we may use currency hedging to further reduce the exposure to our equity cash flow. We are generally a net receiver of these currencies (we receive more cash than we pay out), and therefore our foreign operations benefit from a weaker U.S. dollar and are adversely affected by a stronger U.S. dollar, relative to the foreign currency.

We enter into foreign currency collars to hedge certain of our foreign currency cash flow exposures. See Note 9 for additional information on our foreign currency collars.

#### Concentration of Credit Risk

Concentrations of credit risk arise when a number of tenants are engaged in similar business activities or have similar economic risks or conditions that could cause them to default on their lease obligations to us. We regularly monitor our portfolio to assess potential concentrations of credit risk. While we believe our portfolio is well-diversified, it does contain concentrations in certain areas. There have been no material changes in our concentration of credit risk from what was disclosed in the 2024 Annual Report.

## Controls and procedures

As filed, 1,511 characters.

#### Disclosure Controls and Procedures

Our disclosure controls and procedures include internal controls and other procedures designed to provide reasonable assurance that information required to be disclosed in this and other reports filed under the Exchange Act is recorded, processed, summarized, and reported within the required time periods specified in the SEC’s rules and forms; and that such information is accumulated and communicated to management, including our chief executive officer and chief financial officer, to allow timely decisions regarding required disclosures. It should be noted that no system of controls can provide complete assurance of achieving a company’s objectives and that future events may impact the effectiveness of a system of controls.

Our chief executive officer and chief financial officer, after conducting an evaluation, together with members of our management, of the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, 2025, have concluded that our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) were effective as of March 31, 2025 at a reasonable level of assurance.

#### Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Filed Apr 30, 2025.
Source: SEC EDGAR, the filing index for accession 0001025378-25-000064. Last ingested by Listed: Nov 4, 2026, 18:42 ET. No prices; not investment advice.