Global Net Lease (GNL) risk factors, FY2025 10-K

Risks Related to Our Properties and Operations

1. 01We may be unable to enter into contracts for and complete property acquisitions or dispositions on advantageous terms and our property acquisitions may not perform as we expect42% rewritten
2. 02Our ability to grow our assets depends on our ability to access capital from external sources, and there can be no assurance we will be able to do so on favorable terms or at all
3. 03If we are not able to increase the amount of cash we have available to pay dividends, we may have to reduce dividend payments or identify other financing sources to fund the payment of dividends at their current levels58% rewritten
4. 04Market and economic challenges experienced by the U.S. and global economies may adversely impact our operating results and financial condition
5. 05We are subject to additional risks from our international investments
6. 06Investments in properties or other real estate investments outside the U.S. subject us to foreign currency risk50% rewritten
7. 07Also, governments from time to time intervene in the currency markets, directly and by regulation, in order to influence exchange rates. These events and actions are unpredictable
8. 08A major tenant default may have an adverse impact on our results of operations22% rewritten
9. 09A high concentration of our properties in a particular geographic area magnifies the effects of downturns in that geographic area and could have a disproportionate adverse effect on the value of our investments and results of operations48% rewritten
10. 10Total European Countries 26%95% rewritten
11. 11Likewise, a high concentration of our tenants in a similar industry magnifies the effects of downturns in that industry and would have a disproportionate adverse effect on the value of investments and results of operations41% rewritten
12. 12The inability of a tenant in single-tenant properties to pay rent will materially reduce our revenues
13. 13Single-tenant properties may be difficult to sell or re-lease
14. 14Our real estate investments are generally illiquid which could significantly impede our ability to respond to market conditions or adverse changes in the performance of our tenants or our properties and which would harm our financial condition
15. 15Decreased demand for office space may adversely affect our revenues66% rewritten
16. 16A shift in retail shopping from brick-and-mortar stores to online shopping may have an adverse impact on our Retail segment tenants40% rewritten
17. 17A sale-leaseback transaction may be recharacterized in a tenant’s bankruptcy proceeding
18. 18If a tenant or lease guarantor declares bankruptcy or becomes insolvent, we may be unable to collect balances due under relevant leases
19. 19A bankruptcy could delay efforts to collect past due balances under the relevant leases, and could ultimately preclude full collection of these sums and may decrease or eliminate rental payments from the impacted tenant reducing our cash flow
20. 20The credit profile of our tenants may create a higher risk of lease defaults and therefore lower revenues
21. 21You should not rely solely on the credit ratings of our tenants
22. 22Long-term leases may result in income lower than short term leases
23. 23Properties may have vacancies for a significant period
24. 24We generally obtain only limited warranties when we purchase a property and would therefore have only limited recourse if our due diligence did not identify any issues that lower the value of our property
25. 25We may be unable to secure funds for future tenant improvements or capital needs, which could impact the value of the applicable property or our ability to lease the applicable property on favorable terms
26. 26We have acquired or financed, and may continue to acquire or finance, properties with lock-out provisions which may prohibit us from selling a property, or may require us to maintain specified debt levels for a period of years on some properties
27. 27Rising expenses could reduce cash flow
28. 28Real estate-related taxes may increase and if these increases are not passed on to tenants, our cash flow will be reduced
29. 29greater resources than we do, which could materially and adversely affect us
30. 30Our properties and our tenants may face competition that may affect tenants’ ability to pay rent
31. 31We may incur significant costs to comply with governmental laws and regulations, including those related to environmental matters
32. 32Damage from catastrophic weather and other natural events and climate change could result in losses to us72% rewritten
33. 33Growing public concern about climate change and investor expectations have resulted in the increased focus of local, state, regional, national and international regulatory bodies on greenhouse gas (“GHG”) emissions and climate change issues in recent yearsNew
34. 34If we sell properties by providing financing to purchasers, we will be exposed to defaults by the purchasers
35. 35We may incur a material amount of costs associated with complying with the Americans with Disabilities Act
36. 36Actual or threatened terrorist attacks and other acts of violence, civilian unrest, or war may affect the markets in which we operate our business and our profitability
37. 37Inflation and increases in the inflation rate may have an adverse effect on our investments and results of operations
38. 38Periodically, we have experienced, and we may experience in the future, a decline in the fair value of our real estate assets, resulting in impairment charges that impact our financial condition and results of operations
39. 39Our business and operations could suffer if we experience system failures or cyber incidents or a deficiency in cybersecurity49% rewritten
40. 40We are subject to risks associated with a pandemic, epidemic or outbreak of a contagious disease, which can cause severe disruptions in the U.S. and global economy54% rewritten
41. 41We may make investments in asset classes or countries outside of our core investment strategy which may be perceived as complicating our strategy relative to our peers
42. 42Loss of senior executives with long-standing business relationships could materially impair our ability to operate successfully

Risks Related to our Indebtedness

1. 43We have substantial indebtedness and we will have the ability to incur significant additional indebtedness and other liabilities
2. 44We may be unable to service our indebtedness
3. 45Our derivative financial instruments have been, and any derivative financial instruments in the future, will be subject to counterparty default risk
4. 46Changes in the debt markets could have a material adverse impact on our earnings and financial condition44% rewritten
5. 47If we are unable to borrow monies on terms and conditions that we find acceptable, our ability to purchase properties or, meet other capital requirements may be limited, and the return on the properties we own may be lower. In addition, we may find it difficult, costly or impossible to refinance maturing indebtedness
6. 48Covenants in our debt agreements restrict our activities and could adversely affect our business
7. 49We may not have the funds necessary to finance the repurchase of the Senior Notes in connection with a change of control offer required by the indentures governing each series of notes
8. 50A lowering or withdrawal of the ratings assigned to our debt securities by rating agencies may increase our future borrowing costs, reduce our access to capital or lead to additional restrictions under our debt agreements61% rewritten

Risks Related to Our Corporate Structure, Common Stock and Preferred Stock

1. 51The trading prices of our Common Stock and Preferred Stock may fluctuate significantly
2. 52We depend on our OP and its subsidiaries for cash flow and are structurally subordinated in right of payment to the obligations of our OP and its subsidiaries39% rewritten
3. 53We may issue additional equity securities in the future thereby diluting the holdings of existing stockholders
4. 54We cannot guarantee that our share repurchase program will enhance long-term stockholder value. Share repurchases could also increase the volatility of the price of our Common Stock and could diminish our cash reserves
5. 55The terms of our Preferred Stock, and the terms other preferred stock we may issue, may discourage a third party from acquiring us in a manner that might result in a premium price to our stockholders
6. 56Maryland law prohibits certain business combinations, which may make it more difficult for us to be acquired and may discourage a third party from acquiring us in a manner that might result in a premium price to our stockholders
7. 57Our bylaws designate the Circuit Court for Baltimore City, Maryland as the sole and exclusive forum for certain actions and proceedings that may be initiated by our stockholders
8. 58Maryland law limits the ability of a third-party to buy a large stake in us and exercise voting power in electing directors, which may discourage a third party from acquiring us in a manner that might result in a premium price to our stockholders
9. 59We indemnify our officers and directors against claims or liability they may become subject to due to their service to us, and our rights and the rights of our stockholders to recover claims against our officers and directors are limited
10. 60Material weaknesses in or a failure to maintain an effective system of internal control over financial reporting or disclosure controls could prevent us from accurately and timely reporting our financial results, which could materially and adversely affect us
11. 61We may become subject to litigation, which could materially and adversely affect us
12. 62Our failure to remain qualified as a REIT would subject us to U.S. federal income tax and potentially state and local tax
13. 63To qualify as a REIT, we must meet annual distribution requirements, which may force us to forgo otherwise attractive opportunities or borrow funds during unfavorable market conditions. This could delay or hinder our ability to meet our investment objectives and reduce our stockholders’ overall return
14. 64Recharacterization of sale-leaseback transactions may cause us to lose our REIT status
15. 65Certain of our business activities are potentially subject to the prohibited transaction tax
16. 66TRSs are subject to corporate-level taxes and our dealings with TRSs may be subject to a 100% excise tax
17. 67If the OP failed to qualify as a partnership or is not otherwise disregarded for U.S. federal income tax purposes, we would cease to qualify as a REIT
18. 68We may choose to make distributions in a combination of cash and shares of our Common Stock, in which case our stockholders may be required to pay U.S. federal income taxes in excess of the cash portion of such distributions they receive
19. 69The taxation of distributions can be complex; however, distributions to stockholders that are treated as dividends for U.S. federal income tax purposes generally will be taxable as ordinary income, which may reduce our stockholders’ after-tax anticipated return from an investment in us
20. 70Complying with REIT requirements may limit our ability to hedge our liabilities effectively and may cause us to incur tax liabilities
21. 71Complying with REIT requirements may force us to forgo or liquidate otherwise attractive investment opportunities
22. 72The ability of our Board to revoke our REIT qualification without stockholder approval may subject us to U.S. federal income tax and reduce distributions to our stockholders
23. 73We may be subject to adverse legislative or regulatory tax changes that could increase our tax liability, reduce our operating flexibility and reduce the market price of shares of our stock
24. 74The share ownership restrictions for REITs and the 8.025% share ownership limit in our charter may inhibit market activity in shares of our stock and restrict our business combination opportunities
25. 75These ownership limits could delay or prevent a transaction or a change in control that might involve a premium price for shares of our stock or otherwise be in the best interests of the stockholders
26. 76Potential characterization of dividends and other distributions or gain on sale may be treated as unrelated business taxable income to tax-exempt investors