Broadstone Net Lease (BNL) risk factors, FY2025 10-K

Risks Related to Our Business and Properties

1. 01Single-tenant leases involve significant risks of tenant default and tenant vacancies, which could materially and adversely affect us57% rewritten
2. 02We have limited opportunities to increase rents under our long-term leases with tenants, which could impede our growth and materially and adversely affect us100% rewritten
3. 03Our growth depends upon future acquisitions of properties, and we may be unable to identify or complete suitable acquisitions of properties, which may impede our growth, and our future acquisitions may not yield the returns we seek99% rewritten
4. 04We may not be able to obtain acquisition financing or obtain other capital from third-party sources on favorable terms or at all, which could materially and adversely affect our growth prospects and our business
5. 05An increase in market interest rates could increase our interest costs on existing and future debt and could adversely affect our stock price, and a decrease in market interest rates could lead to additional competition for the acquisition of real estate, which could adversely affect our results of operations
6. 06As we continue to acquire properties pursuant to our investment strategy, our portfolio may become less diversified, which could materially and adversely affect us
7. 07We face significant competition for acquiring properties from both publicly traded REITs and private investors that have greater resources than we do, which could materially and adversely affect us
8. 08Our portfolio is concentrated in certain states, and any adverse developments and economic downturns in these geographic markets could materially and adversely affect us28% rewritten
9. 09Our portfolio is concentrated in certain property types and any adverse developments relating to these property types could materially and adversely affect us
10. 10If one or more of our top 10 tenants, which together represented approximately 21.1% of our ABR as of December 31, 2025, suffers a downturn in their business, it could materially and adversely affect us31% rewritten
11. 11We may be unable to sell a property at the time we desire on favorable terms or at all, which could limit our ability to access capital through dispositions and could adversely affect our cash flow, financial condition, and results of operations
12. 12We may be unable to renew leases, re-lease properties as leases expire, or lease vacant spaces on favorable terms or at all, which, in each case, could materially and adversely affect us
13. 13Property vacancies could result in significant capital expenditures and illiquidity, particularly for specialty properties that are suitable for only one use
14. 14Our underwriting and risk management procedures that we use to evaluate a tenant’s credit risk may be faulty, deficient, or otherwise fail to accurately reflect the risk of our investment, which could materially and adversely affect us32% rewritten
15. 15We may experience a higher number of tenant defaults because we lease most of our properties to tenants who do not have an investment grade credit rating53% rewritten
16. 16We could face potential material adverse effects from the bankruptcies or insolvencies of our tenants
17. 17Our properties may be subject to impairment charges68% rewritten
18. 18We may engage in development or expansion projects, including speculative development projects, which would subject us to additional risks that could negatively impact our operations100% rewritten
19. 19We may enter into new transaction structures, including real estate lending opportunities, the provision of transitional capital, and joint ventures, which would subject us to additional risks that could negatively impact our operations
20. 20Our business may be adversely affected by changes in U.S. trade policy, including the imposition of tariffs and resulting effectsNew
21. 21Security breaches, technology disruptions, and new technologies could compromise our information systems and expose us to liability, which could materially and adversely affect us33% rewritten
22. 22Changes in accounting standards may materially and adversely affect us
23. 23Certain provisions of our leases or loan agreements may be unenforceable, which could materially and adversely affect us
24. 24We may become subject to litigation, which could materially and adversely affect us
25. 25A failure to maintain effective internal controls could materially and adversely affect us
26. 26A limited number of our leases may require us to pay property-related expenses that are not the obligations of our tenants, which could materially and adversely affect us
27. 27As a property owner, we may be subject to environmental liabilities, which could be substantial
28. 28Our ability to effectively monitor and respond to the rapid and ongoing developments and often conflicting expectations regarding our corporate responsibility and sustainability efforts may impose unexpected costs or result in reputational or other harm that could have a material adverse effect on our business
29. 29We may acquire properties or portfolios of properties through tax deferred contribution transactions, which could result in stockholder dilution and limit our ability to sell such assets
30. 30The departure of any of our key personnel with long-standing business relationships could materially and adversely affect us

Risks Related to Investments in Real Estate

1. 31Our operating results are affected by economic and regulatory changes that impact the commercial real estate market in general
2. 32Global and U.S. financial markets and economic conditions, such as inflation, may materially and adversely affect us and the ability of our tenants to make rental payments to us pursuant to our leases
3. 33Our real estate investments are illiquid
4. 34We face risks associated with climate change, which could materially and adversely impact us
5. 35Natural disasters, pandemics or epidemics, terrorist attacks, other acts of violence or war, or other catastrophic events could materially and adversely impact us
6. 36Insurance on our properties may not adequately cover all losses and uninsured losses could materially and adversely affect us
7. 37Our costs of compliance with laws and regulations may require us or our tenants to make unanticipated expenditures that could reduce the investment return of our stockholders

Risks Related to Debt Financing

1. 38As of December 31, 2025, we had approximately $2.5 billion principal balance of indebtedness outstanding, which may expose us to the risk of default under our debt obligations55% rewritten
2. 39Failure to hedge effectively against interest rate changes may materially and adversely affect us70% rewritten
3. 40Our Revolving Credit Facility and term loan agreements contain various covenants which, if not complied with, could accelerate our repayment obligations, thereby materially and adversely affecting us
4. 41Failure to maintain our current credit ratings could materially and adversely affect our cost of capital, liquidity, and access to capital markets
5. 42We may incur mortgage debt on a particular property, which may subject us to certain risks, and the occurrence of any such risk could materially and adversely affect us

Risks Related to Our Organizational Structure

1. 43Our Charter contains provisions, including ownership and transfer restrictions, that may delay, discourage, or prevent a takeover or change of control transaction that could otherwise result in a premium price to our stockholders
2. 44We may issue preferred stock or separate classes or series of common stock, which could adversely affect the holders of our common stock
3. 45Termination of the employment agreements with certain members of our executive management team could be costly
4. 46Our Board of Directors may change our investment and financing policies without stockholder approval, which could materially and adversely alter the nature of an investment in us
5. 47Our rights and the rights of our stockholders to take action against our directors and officers are limited70% rewritten
6. 48We are a holding company with no direct operations and rely on funds received from the OP to pay liabilities
7. 49Our UPREIT structure may result in potential conflicts of interest between the interests of our stockholders and members in the OP, which may materially and adversely impede business decisions that could benefit our stockholders81% rewritten
8. 50Agreement in connection with the management of the OP. Our fiduciary duties and obligations, as the managing member of the OP, and its members may come into conflict with the duties of our directors and officers to our CompanyNew
9. 51Failure to qualify as a REIT would materially and adversely affect us and the value of our common stock41% rewritten
10. 52Even if we remain qualified as a REIT for U.S. federal income tax purposes, we may be subject to other tax liabilities that reduce our cash flow and our ability to make distributions to our stockholders
11. 53To satisfy the REIT distribution requirements, we may be forced to take certain actions to raise funds if we have insufficient cash flow which could materially and adversely affect us and the trading price of our common stock
12. 54The IRS may treat sale-leaseback transactions as loans, which could jeopardize our REIT status or require us to make an unexpected distribution
13. 55The prohibited transactions tax may limit our ability to engage in sale transactions
14. 56Complying with the REIT Requirements may limit our ability to hedge effectively and may cause us to incur tax liabilities
15. 57Complying with the REIT Requirements may force us to liquidate or forgo otherwise attractive investments
16. 58In certain circumstances, we may be liable for certain tax obligations of certain of the members of the OP
17. 59In connection with acquisitions, we may inherit tax liabilities and attributes of other entities
18. 60Changes to the U.S. federal income tax laws could have a material and adverse effect on us

Risks Related to Ownership of Our Common Stock

1. 61The market price and trading volume of shares of our common stock may be volatile and could be substantially affected by various factors37% rewritten
2. 62We may not be able to make distributions to our stockholders at the times or in the amounts we expect, or at all
3. 63Future offerings of debt, which would be senior to shares of our common stock upon liquidation, and/or preferred equity securities that may be senior to shares of our common stock for purposes of distributions or upon liquidation, may materially and adversely affect the market price of shares of our common stock
4. 64Sales of substantial amounts of our capital stock in the public markets may dilute your voting power and your ownership interest in us