Net Lease Office Properties : Second Quarter 2025 Investor Presentation

Published: 2025-06-25 16:18:05 ET NLOP

Published on 06/25/2025 at 16:18

June 2025

‌NLOP Overview

Net Lease Office Properties (NYSE: NLOP) is a publicly-traded real estate investment trust (REIT) focused on realizing value through the strategic asset management and disposition of its portfolio over time

NLOP is externally managed by W. P. Carey, an advisor with significant expertise and a proven track record of repositioning, leasing and disposing of net lease office assets

Initially spun out of W. P. Carey in 2023, NLOP's portfolio consisted of 59 net lease office

properties, with ABR of ~$145 million, almost all of which were located in the U.S.

Since inception, NLOP has successfully disposed of 22 properties with $42 million of ABR and today has a portfolio of 37 properties with $88 million of ABR

Excess proceeds from dispositions completed to date have primarily been used to pay down $455 million of debt originated at spin, which has now been fully repaid

Consistent with its strategic plan, NLOP expects to distribute proceeds from sales to its shareholders efficiently (1)

(1) Dividends paid by NLOP will be authorized and determined by NLOP's Board of Trustees, in its sole discretion, and will be dependent upon a number of factors.

‌Continued Execution of Stated Plan

218.8%

Nov. 2023

NLOP

begins trading regular way on NYSE.

Jan. 2024

Sales of four properties totaling

$43 million announced.

May 2024

Sales of three properties totaling

$132 million announced.

Jun. 2024

Sales of two properties totaling

$61 million announced.

Jan. 2025

Repayment in full of J.P. Morgan senior secured mortgage and sales of five properties totaling

$43 million announced.

Aug. 2024

Sale of one property for

$72 million announced.

Apr. 2025

Repayment in full of J.P. Morgan mezzanine loan and sales of two properties totaling

$10 million announced.

0.0%

Nov-23 Feb-24 May-24 Aug-24 Dec-24 Mar-25 Jun-25

NLOP Price Performance

Note: Market data as of June 20, 2025.

‌NLOP Business Plan Progression

CORALVILLE, IA

Portfolio

At Spin

# of Properties

Total Square Footage

9 MM

Number of Tenants

ABR ($MM)

$145

WALT (1)

5.7 years

Geography (US / Europe) (1)

89% / 11%

JPM Senior Loan

$335 MM

JPM Mezzanine Loan

$120 MM

Existing Mortgage Debt

$168 MM

Wtd. Avg. Interest Rate

9.6%

Today

6 MM

$88

4.1 years

95% / 5%

$ --

$115 MM

6.4%

Through efficient asset sale execution and prudent capital management, NLOP was able to fully repay both the senior and mezzanine loans 10 months and 3.5 years ahead of their initial maturities, respectively

ST. PETERSBURG, FL

Balance Sheet

(1) Figures are based on September 30, 2023 and March 31, 2025 annualized base rent ("ABR"), respectively.

‌Leasing Activity

Dollars in thousands. Pro rata. As of March 31, 2025.

Tenant / Lease Guarantor

Property Location

Square Footage

Prior ABR

New ABR (1)

Rent Recapture

Expected TIs

LCs

Incremental Term

BCBSM (2 properties)

Eagan, MN

347,472

$5,041

$4,663

92.5%

$1,624

$ --

10.0 years

Nokia

Krakow, Poland

53,400

1,096

829

75.6%

995

5.0 years

Merative

Hartland, WI

81,082

909

669

73.6%

1,650

559

10.0 years

Northrop Grumman

Plymouth, MN

191,336

3,821

2,679

70.1%

5.0 years

Caremark (2)

Chandler, AZ

65,860

1,839

1,645

89.5%

415

5.4 years

Charter

Bridgeton, MO

78,080

820

859

104.8%

5.0 years

S&ME

Raleigh, NC

31,120

430

545

126.7%

1,556

305

12.4 years

Pioneer Credit (3)

Moorestown, NJ

30,000

527

540

102.5%

1.5 years

Lincoln Technical (3)

Moorestown, NJ

35,567

397

391

98.5%

5.0 years

Google (4)

Venice, CA

67,681

3,018

3,108

103.0%

---

357

5.0 years

JPMorgan

Tampa, FL

104,565

1,321

1,864

141.1%

576

3.0 years

Total / Wtd. Avg. (5)

1,086,163

$19,219

$17,792

92.6%

$5,825

$2,212

6.4 years

Dollars in thousands. Pro rata. As of March 31, 2025.

Tenant / Lease Guarantor

Property Location

Square Footage

Number of Leases

New ABR (1)

Expected TIs

LCs

New Term

Phoenix Data Systems (6)

Southfield, MI

6,431

$72

$ --

5.0 years

CT Logic (6)

Southfield, MI

1,668

3.0 years

Total / Wtd. Avg. (5)

8,099

$96

$ --

4.5 years

Note: Excludes lease extensions for a period of one year or less.

New lease amounts are based on in-place rents at time of lease commencement and exclude any free rent periods.

Reflects a reduction in square footage leased by the tenant.

Pioneer Credit Recovery, Inc. and Lincoln Technical Institute, Inc. are tenants at our multi-tenant property in Moorestown, New Jersey.

Lease renewal period commences on November 1, 2025.

Weighted average refers to the incremental and new lease terms.

Phoenix Data Systems and CT Logic were tenants at our multi-tenant property in Southfield, Michigan, prior to that property's disposition in December 2024.

‌Asset Sale Summary

Dollars in thousands. Pro rata. As of March 31, 2025.

Tenant / Lease Guarantor

Primary Tenant Industry

Property Location

ABR (1)

Gross Sales Proceeds

Square Footage

Closing Date

Raytheon

Aerospace & Defense

Tucson, AZ

$1,978

$24,575

143,650

Dec-23

Carhartt

Apparel, Accessories & Luxury

Dearborn, MI

748

9,806

58,722

Dec-23

BCBSM

Managed Health Care

Eagan, MN

298

2,500

29,916

Dec-23

AVL

Auto Parts & Equipment

Plymouth, MI

575

6,200

70,000

Dec-23

Undisclosed (2)

Property & Casualty Insurance

Newport, United Kingdom

1,761

10,497

80,664

Jan-24

Total E&P Norge (2)

Oil & Gas Exploration & Production

Stavanger, Norway

5,185

33,072

275,725

Mar-24

Exelon (3)

Electric Utilities

Warrenville, IL

2,935

19,830

146,745

Apr-24

Vacant (formerly AVT) (3)

N/A

Tempe, AZ

13,160

132,070

Apr-24

FedEx

Air Freight & Logistics

Collierville, TN

5,491

62,500

390,380

Apr-24

DMG MORI SEIKI U.S.A.

Industrial Machinery

Hoffman Estates, IL

2,458

35,984

104,598

Apr-24

11/12

BCBSM (2 properties)

Managed Health Care

Eagan, MN

4,663

60,700

347,472

Jun-24

CVS

Healthcare Services

Scottsdale, AZ

4,252

71,500

354,888

Aug-24

Xileh

Multi-Sector Holdings

Auburn Hills, MI

711

9,000

55,490

Sep-24

E. On UK (2)

Internet Retail

Houghton le Spring, United Kingdom

3,819

3,924

217,339

Oct-24

Vacant (formerly BCBSM)

N/A

Eagan, MN

11,650

227,666

Nov-24

Merative

IT Consulting & Other Services

Hartland, WI

669

6,750

81,082

Dec-24

Charter

Cable & Satellite

Bridgeton, MO

820

7,350

78,080

Dec-24

Caremark

Health Care Services

Chandler, AZ

1,645

15,000

183,000

Dec-24

Cofinity / Aetna

Multi-line Insurance

Southfield, MI

1,833

2,500

94,453

Dec-24

Emerson

Industrial Machinery

Houston, TX

1,108

4,180

52,144

Mar-25

Nokia (2)

Communications Equipment

Krakow, Poland

779

5,595

53,400

Mar-25

Total

$41,728

$416,273

3,177,484

U.S.

Properties

European Properties

Gross Sales Proceeds

ABR is pro forma for any agreed to and signed future rent restructurings.

Amount reflects the applicable exchange rate on the date of the transaction.

NLOP transferred ownership of these properties and the related non-recourse mortgage loans to the respective mortgage lenders. Gross proceeds from these dispositions represent the mortgage principal outstanding on the respective dates of transfer.

‌Remaining Portfolio

Tenant / Lease Guarantor

Primary Tenant Industry

Property Location

ABR

Square Footage (1)

Tenant / Lease Guarantor

Primary Tenant Industry

Property Location

ABR

Square Footage

KBR (2)(3)

Construction & Engineering

Houston, TX

$21,306

1,064,788

Acosta

Advertising

Jacksonville, FL

$1,541

88,062

JPMorgan

Diversified Banks

Fort Worth, TX

4,850

386,154

Safelite

Specialized Consumer Services

Rio Rancho, NM

1,527

94,649

Siemens (4)

Industrial Conglomerates

Oslo, Norway

4,633

165,905

Master Lock

Building Products

Oak Creek, WI

1,437

120,883

PPD

Pharmaceuticals

Morrisville, NC

4,063

219,812

MISO

Electric Utilities

Eagan, MN

1,148

60,463

Omnicom

Advertising

Playa Vista, CA

3,961

120,000

Radiate

Cable & Satellite

San Marcos, TX

1,074

47,000

R.R. Donnelley

Commercial Printing

Warrenville, IL

3,393

167,215

NA Lighting

Auto Parts & Equipment

Farmington Hills, MI

1,058

75,286

Iowa Board of Regents (5)

Government Related Services

Coralville, IA

3,254

191,700

Arcfield

Aerospace & Defense

King of Prussia, PA

1,000

88,578

Bankers Financial (2)(3)

Property & Casualty Insurance

St. Petersburg, FL

3,228

167,581

Pioneer Credit (2)

Diversified Support Services

Moorestown, NJ

937

65,567

JPMorgan

Diversified Banks

Tampa, FL

3,053

176,150

APCO

Property & Casualty Insurance

Norcross, GA

631

50,600

Google

Internet Software & Services

Venice, CA

3,018

67,681

Undisclosed

Industrial Gases

Houston, TX

629

49,821

ICU MEDICAL (2)

Health Care Supplies

Plymouth, MN

2,890

182,250

S&ME

Environmental & Facilities Services

Raleigh, NC

545

31,120

Northrop Grumman

Aerospace & Defense

Plymouth, MN

2,679

191,336

Radiate

Cable & Satellite

Waco, TX

473

30,699

Intuit

Internet Software & Services

Plano, TX

2,577

166,033

Radiate

Cable & Satellite

Corpus Christi, TX

355

20,717

Cohesity

Systems Software

Roseville, MN

2,255

136,125

Radiate

Cable & Satellite

Odessa, TX

236

21,193

Cenlar

Regional Banks

Yardley, PA

2,105

105,584

Radiate

Cable & Satellite

San Marcos, TX

212

14,400

iHeartCommunications

Broadcasting

San Antonio, TX

2,050

120,147

Vacant (fmr. BCBSM) (6)

N/A

Eagan, MN

442,542

JPMorgan (2)(3)

Diversified Banks

Tampa, FL

1,932

135,733

Vacant (fmr. McKesson) (6)

N/A

The Woodlands, TX

204,063

Arbella

Property & Casualty Insurance

Quincy, MA

1,850

132,160

Vacant (fmr. BCBSM) (6)

N/A

Eagan, MN

12,286

ICF

IT Consulting & Other Services

Martinsville, VA

1,830

93,333

Total

$87,730

5,507,616

Dollars in thousands. Pro rata. As of March 31, 2025.

Excludes 570,999 of operating square footage for a parking garage associated with the KBR, Inc. property in Houston, Texas

Denotes multi-tenant property. Primary tenant generating largest percentage of ABR shown. Industry is for primary tenant.

Denotes leased property that is not 100% occupied.

ABR reflects exchange rate as of March 31, 2025.

NLOP owns a 90% controlling interest in this consolidated property.

Denotes property that is vacant as of the date of this report.

Disclaimer

Net Lease Office Properties published this content on June 25, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on June 25, 2025 at 20:17 UTC.