Gladstone Commercial Corporation Reports Results for the Third Quarter Ended September 30, 2026

Occupancy and rent collections improved or held steady, but lower revenue and higher expenses weighed on quarterly earnings.

Rhea-AI Summary

Gladstone Commercial (Nasdaq: GOOD) reported third-quarter 2026 operating revenue of $42.419 million, down from the preceding quarter. Revenue fell 3.6%, while the loss attributable to common stockholders and non-controlling operating partnership unitholders was $5.193 million, versus income of $5.128 million. Diluted Core funds from operations, an adjusted non-GAAP earnings measure, fell 7.8% to $16.899 million, or $0.35 per share. Operating expenses included a $6.518 million property impairment.

Occupancy rose to 99.3% from 98.7%, and cash rent collections were 100% for the quarter and October. The company acquired an industrial property for $6.6 million at a 9.16% capitalization rate and raised $2.2 million net through common share sales. After quarter-end, it repaid $10.2 million of mortgage debt. Common distributions declared for October through December total $0.30 per share.

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Hollow bars mark forward-looking points. How the balance works

Positive

• Moderate pointIndustrial acquisition added a fully occupied property for $6.6 million at a 9.16% capitalization rate. 1.2% of market cap
• Minor pointOccupancy increased to 99.3% at September 30, 2026, from 98.7% at June 30.
• Minor pointCash rent collections reached 100% for the first three quarters of 2026 and October.
• Minor pointQuarterly leasing and renewals covered 502,557 square feet, with remaining terms of 5.5–20.0 years.
• Minor pointPost-quarter renewals covered 522,521 square feet, with remaining terms of 3.6–5.1 years.

4 minor points

• Minor pointCommon stock sales raised $2.2 million in net proceeds under the at-the-market program.
• Minor pointPost-quarter repayment retired $10.2 million of fixed-rate mortgage debt carrying 4.25% interest.
• Minor pointGeneral and administrative expenses and the net incentive fee were lower than the previous quarter.
• Minor point. Forward-looking: it has not happened yet and may not happen.The company plans non-core asset sales to reduce leverage and acquire properties, emphasizing industrial investments.

Negative

• Moderate pointThird-quarter operating revenue declined 3.6% to $42.419 million from $43.989 million in the second quarter.
• Moderate pointCommon-holder and operating partnership unitholder results swung to a $5.193 million loss from $5.128 million income.
• Moderate pointOperating expenses rose 25.5% to $32.915 million, including a $6.518 million impairment on one property. 1.2% of market cap
• Moderate pointOther expense, net increased 22.0% to $11.567 million from $9.482 million in the second quarter.
• Moderate pointDiluted funds from operations fell 7.8% to $16.860 million; per-share results declined to $0.35 from $0.38.
• Moderate pointDiluted Core funds from operations fell 7.8% to $16.899 million; per-share results declined to $0.35 from $0.38.

4 minor points

• Minor pointBasic and diluted loss per share was $0.11, versus $0.11 income in the second quarter.
• Minor pointCommon stock issuance added 168,868 shares under the at-the-market program, diluting existing holders.
• Minor pointReported mortgage, revolver, term-loan and senior unsecured debt increased 0.7% to $858.271 million from June 30.
• Minor pointTotal equity and mezzanine equity declined 2.9% to $318.104 million from $327.525 million at June 30.

Key Figures

Core FFO: $16.9 million; decreased 7.8% Core FFO per share: $0.35; decreased 7.9% Net loss attributable to common stockholders and OP Unitholders: $5.2 million; $0.11 per share loss +5 more

Core FFO

$16.9 million; decreased 7.8%

Third quarter 2026 vs. second quarter 2026

Core FFO per share

$0.35; decreased 7.9%

Diluted, third quarter 2026 vs. second quarter 2026

Net loss attributable to common stockholders and OP Unitholders

$5.2 million; $0.11 per share loss

Third quarter 2026

Total operating revenue

$42.419 million; decreased 3.6%

Third quarter 2026 vs. second quarter 2026

Impairment charge

$6.5 million

Recognized on one property during the third quarter

ATM program issuance

168,868 shares; $2.2 million net proceeds

Third quarter 2026

Cash rent collection

100%

Cash rents due during July, August, and September

Mortgage debt repaid

$10.2 million at 4.25%

Subsequent to quarter-end

Previous Earnings Reports

1 past event · Latest: Aug 05

Same Type 1 event

1. Aug 05

   Quarterly earnings

   24h Move

   +5.5%

   Core FFO increased 7.7% sequentially to $18.3 million, or $0.38 per diluted share.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

ffo, non-gaap, at-the-market program, sofr

4 terms

ffo financial

"A description of funds from operations, or FFO, and Core FFO"

Funds from operations (FFO) is a performance metric used mainly for real estate companies that measures the cash generated by their core rental and property-management activities, while removing accounting items such as building depreciation and one-time gains or losses from property sales. Investors rely on FFO to assess a real estate firm's ability to pay and sustain dividends and fund growth—similar to checking how much actual rent a landlord collects each month rather than paper profits.

non-gaap financial

"both non-GAAP financial measures"

Non-GAAP refers to financial measures that companies use to show their earnings or performance without including certain expenses or income that are often added back to give a different picture. It matters because it can make a company's results look better or more favorable, but it may also hide important costs, so investors need to look at both GAAP (official rules) and non-GAAP numbers to get a full understanding.

View in glossary

at-the-market program financial

"Issued 168,868 shares of common stock under our at-the-market program"

An at-the-market program is a way for a company to sell new shares of its stock gradually over time directly into the stock market, rather than all at once. This approach allows the company to raise money as needed while giving investors the opportunity to buy shares at current market prices. It helps manage the timing and price of new stock offerings, providing flexibility for both the company and investors.

sofr financial

"higher interest expense due to the SOFR rate increasing"

The Secured Overnight Financing Rate (SOFR) is a market benchmark that measures the cost of borrowing cash overnight using U.S. Treasury securities as collateral. Investors watch SOFR because it acts like a speedometer for short-term interest costs—affecting loan rates, bond yields and the pricing of interest-rate contracts—so movements change borrowing expenses, cash returns and the value of interest-sensitive investments.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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MCLEAN, VA / ACCESS Newswire / November 3, 2026 / Gladstone Commercial Corporation (Nasdaq:GOOD) ("Gladstone Commercial" or the "Company") today reported financial results for the third quarter ended September 30, 2026. A description of funds from operations, or FFO, and Core FFO, both non-GAAP (generally accepted accounting principles in the United States) financial measures, are located at the end of this press release. All per share references are to fully-diluted weighted average shares of common stock and Non-controlling OP Units, unless otherwise noted. For further detail, please also refer to both the quarterly financial supplement and the Company's Quarterly Report on Form 10-Q, which can be retrieved from the Investors section of our website at www.gladstonecommercial.com.

Summary Information (dollars in thousands, except share and per share data):

		As of and for the three months ended
		September 30, 2026				June 30, 2026				$ Change				% Change
Operating Data:
Total operating revenue		$	42,419			$	43,989			$	(1,570	)			(3.6	)%
Total operating expenses			(32,915	)	(1)		(26,237	)			(6,678	)			25.5	%
Other expense, net			(11,567	)			(9,482	)			(2,085	)			22.0	%
Net (loss) income		$	(2,063	)		$	8,270			$	(10,333	)			(124.9	)%
Less: Dividends attributable to preferred stock			(3,032	)			(3,036	)			4				(0.1	)%
Less: Dividends attributable to senior common stock			(100	)			(99	)			(1	)			1.0	%
Add/Less: Gain (loss) on extinguishment of Series F preferred stock, net			2				(7	)			9				(128.6	)%
Net (loss) income (attributable) available to common stockholders and Non-controlling OP Unitholders		$	(5,193	)		$	5,128			$	(10,321	)			(201.3	)%
Add: Real estate depreciation and amortization			15,435				14,957				478				3.2	%
Add: Impairment charge			6,518				-				6,518				100.0	%
Less: Gain on sale of real estate, net			-				(1,894	)			1,894				(100.0	)%
Funds from operations available to common stockholders and Non-controlling OP Unitholders - basic		$	16,760			$	18,191			$	(1,431	)			(7.9	)%
Add: Convertible senior common distributions			100				99				1				1.0	%
Funds from operations available to common stockholders and Non-controlling OP Unitholders - diluted		$	16,860			$	18,290			$	(1,430	)			(7.8	)%
Funds from operations available to common stockholders and Non-controlling OP Unitholders - basic		$	16,760			$	18,191			$	(1,431	)			(7.9	)%
Add: Asset retirement obligation expense			39				37				2				5.4	%
Core funds from operations available to common stockholders and Non-controlling OP Unitholders - basic		$	16,799			$	18,228			$	(1,429	)			(7.8	)%
Add: Convertible senior common distributions			100				99				1				1.0	%
Core funds from operations available to common stockholders and Non-controlling OP Unitholders - diluted		$	16,899			$	18,327			$	(1,428	)			(7.8	)%
Share and Per Share Data:
Net (loss) income (attributable) available to common stockholders and Non-controlling OP Unitholders - basic and diluted		$	(0.11	)		$	0.11			$	(0.22	)			(200.0	)%
FFO available to common stockholders and Non-controlling OP Unitholders - basic		$	0.35			$	0.38			$	(0.03	)			(7.9	)%
FFO available to common stockholders and Non-controlling OP Unitholders - diluted		$	0.35			$	0.38			$	(0.03	)			(7.9	)%
Core FFO available to common stockholders and Non-controlling OP Unitholders - basic		$	0.35			$	0.38			$	(0.03	)			(7.9	)%
Core FFO available to common stockholders and Non-controlling OP Unitholders - diluted		$	0.35			$	0.38			$	(0.03	)			(7.9	)%
Weighted average shares of common stock and Non-controlling OP Units outstanding - basic			48,507,694				48,446,593				61,101				0.1	%
Weighted average shares of common stock and Non-controlling OP Units outstanding - diluted			48,829,501				48,768,526				60,975				0.1	%
Cash dividends declared per common share and Non-controlling OP Unit		$	0.30			$	0.30			$	-				-	%
Financial Position
Real estate, before accumulated depreciation		$	1,427,631			$	1,418,722			$	8,909				0.6	%
Total assets		$	1,245,747			$	1,242,968			$	2,779				0.2	%
Mortgage notes payable, net, borrowings under revolver, borrowings under term loan, net, and senior unsecured notes, net		$	858,271			$	852,050			$	6,221				0.7	%
Total equity and mezzanine equity		$	318,104			$	327,525			$	(9,421	)			(2.9	)%
Properties owned			152				151				1				0.7	%
Square feet owned			17,816,521				17,669,871				146,650				0.8	%
Square feet leased			99.3	%			98.7	%			0.6	%			0.6	%

(1) Includes a $6.5 million impairment charge recognized on one property during the three months ended September 30, 2026.

Third Quarter Activity:

• Collected 100% of cash rents: Collected 100% of cash rents due during July, August, and September;
• Acquired property: Purchased one fully-occupied industrial property with 146,650 square feet of rental space, for $6.6 million and a cap rate of 9.16%;
• Completed leasing activity: Leased or renewed 502,557 square feet with remaining lease terms ranging from 5.5 years to 20.0 years at four of our properties;
• Issued common stock under ATM Program: Issued 168,868 shares of common stock under our at-the-market ("ATM") program for net proceeds of $2.2 million; and
• Paid distributions: Paid monthly cash distributions for the quarter totaling $0.30 per share on our common stock and Non-controlling OP Units, $0.414063 per share on our Series E Preferred Stock, $0.375 per share on our Series F Preferred Stock, $0.375 per share on our Series G Preferred Stock, and $0.2625 per share on our senior common stock.

Third Quarter 2026 Results: Core FFO available to common shareholders and Non-controlling OP Unitholders for the three months ended September 30, 2026 was $16.9 million, a 7.8% decrease when compared to the three months ended June 30, 2026, equaling $0.35 per share. Core FFO decreased primarily due to higher property expenses, higher interest expense due to the SOFR rate increasing, and a lease termination fee recognized on the property sold during the previous period. This was partially offset by lower general and administrative expenses and a lower net incentive fee in the current period.

Net loss attributable to common stockholders and Non-controlling OP Unitholders for the three months ended September 30, 2026 was $5.2 million, or $0.11 per share, compared to net income available to common stockholders and Non-controlling OP Unitholders for the three months ended June 30, 2026 of $5.1 million, or $0.11 per share. In the Summary Information table above, we provide a reconciliation of Core FFO to net (loss) income (which we believe is the most directly comparable GAAP measure to Core FFO) for the three months ended September 30, 2026 and June 30, 2026, a computation of basic and diluted Core FFO per weighted average share of common stock and Non-controlling OP Unit, and basic and diluted net (loss) income per weighted average share of common stock and Non-controlling OP Unit.

Subsequent to the end of the quarter:

• Collected 100% of October cash rents: Collected 100% of cash rents due in October;
• Renewed space: Renewed 522,521 square feet with remaining lease terms ranging from 3.6 years to 5.1 years at three of our properties;
• Repaid debt: Repaid $10.2 million in fixed rate mortgage debt at an interest rate of 4.25%; and
• Declared distributions: Declared monthly cash distributions for October, November, and December 2026, totaling $0.30 per share on our common stock and Non-controlling OP Units, $0.414063 per share on our Series E Preferred Stock, $0.375 per share on our Series F Preferred Stock, $0.375 per share on our Series G Preferred Stock, and $0.2625 per share on our senior common stock.

Comments from Gladstone Commercial's Chief Executive Officer and President, Buzz Cooper: "Our financial results reflect consistent performance and stabilized revenues from our tremendous same store property occupancy, rent collection and growth, accretive real estate investments, and our ability to renew tenants. We plan to continue our capital recycling program, whereby we sell non-core assets and use the proceeds to de-lever our portfolio, as well as to acquire properties in our target growth markets. We will continue to opportunistically sell non-core assets and redeploy the proceeds into stronger target growth markets with a focus on industrial investment opportunities. While we expect to face challenges due to inflation, with a corresponding increase in interest rates, and various geo-political and economic issues, we feel strongly about the depth of our tenant credit underwriting. We have collected 100% of the first three quarters' cash rents and 100% of October cash rents. We anticipate our tenants will successfully navigate the current economic climate and will be able to continue operating successfully when economic normalcy returns fully. Despite economic uncertainty, through the third quarter of 2026, we leased or renewed 1,468,614 square feet with 12 tenants. We are actively marketing our remaining vacant space and currently anticipate positive outcomes. We expect to continue to have access to the debt and equity markets, as necessary, for added liquidity. We believe our same store rents, which have increased by 2% or greater annually in recent years, should continue to rise as we grow, and we will continue to primarily focus on investing in our target markets, with an emphasis on industrial properties and actively managing our portfolio."

Conference Call: Gladstone Commercial will hold a conference call on Wednesday, November 4, 2026, at 8:30 a.m. Eastern Time to discuss its earnings results. Please call (877) 407-9045 to enter the conference call. An operator will monitor the call and set a queue for questions. A conference call replay will be available beginning one hour after the call and will be accessible through November 11, 2026. To hear the replay, please dial (877) 660-6853 and use playback conference number 13762361. The live audio broadcast of the Company's quarterly conference call will also be available on the investors section of our website, www.gladstonecommercial.com.

About Gladstone Commercial: Gladstone Commercial Corporation is a real estate investment trust focused on acquiring, owning, and operating net leased industrial and office properties across the United States. Further information can be found at www.gladstonecommercial.com.

About the Gladstone Companies: Information on the business activities of the Gladstone family of funds can be found at www.gladstonecompanies.com.

Investor Relations: For Investor Relations inquiries related to any of the monthly distribution-paying Gladstone family of funds, please visit www.gladstonecompanies.com.

Non-GAAP Financial Measures:

FFO: The National Association of Real Estate Investment Trusts ("NAREIT") developed FFO as a relative non-GAAP supplemental measure of operating performance of an equity REIT to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO, as defined by NAREIT, is net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property and impairment losses on property, plus depreciation and amortization of real estate assets, and after adjustments for unconsolidated partnerships and joint ventures. FFO does not represent cash flows from operating activities determined in accordance with GAAP and should not be considered an alternative to net income as an indication of its performance or to cash flow from operations as a measure of liquidity or ability to make distributions. The Company believes that FFO per share provides investors with an additional context for evaluating its financial performance and as a supplemental measure to compare it to other REITs; however, comparisons of its FFO to the FFO of other REITs may not necessarily be meaningful due to potential differences in the application of the NAREIT definition used by such other REITs.

Core FFO: Core FFO is FFO adjusted for certain items that are not indicative of the results provided by the Company's operating portfolio and affect the comparability of the Company's period-over-period performance. These items include the adjustment for acquisition related expenses, gains or losses from early extinguishment of debt and any other non-recurring expense adjustments. Although the Company's calculation of Core FFO differs from NAREIT's definition of FFO and may not be comparable to that of other REITs, the Company believes it is a meaningful supplemental measure of its operating performance. Accordingly, Core FFO should be considered a supplement to net income computed in accordance with GAAP as a measure of our performance.

The Company's presentation of FFO, as defined by NAREIT, or presentation of Core FFO, does not represent cash flows from operating activities determined in accordance with GAAP and should not be considered an alternative to net income as an indication of its performance or to cash flow from operations as a measure of liquidity or ability to make distributions.

The statements in this press release regarding the forecasted stability of Gladstone Commercial's income, its ability, plans or prospects to re-lease its unoccupied properties, and grow its portfolio are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements inherently involve certain risks and uncertainties, although they are based on Gladstone Commercial's current plans that are believed to be reasonable as of the date of this press release. Factors that may cause actual results to differ materially from these forward-looking statements include, but are not limited to, Gladstone Commercial's ability to raise additional capital; availability and terms of capital and financing, both to fund its operations and to refinance its indebtedness as it matures; downturns in the current economic environment; the performance of its tenants; the impact of competition on its efforts to renew existing leases or re-lease space; and significant changes in interest rates. Additional factors that could cause actual results to differ materially from those stated or implied by its forward-looking statements are disclosed under the caption "Risk Factors" of its Form 10-K for the fiscal year ended December 31, 2025, as filed with the SEC on February 18, 2026, and other reports filed with the SEC. Gladstone Commercial cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Gladstone Commercial undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

CONTACT:

Gladstone Commercial Corporation
(703) 287-5893

SOURCE: Gladstone Commercial Corporation

View the original press release on ACCESS Newswire

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were Gladstone Commercial's third-quarter 2026 earnings and Core FFO?

Gladstone Commercial reported a $5.193 million loss attributable to common stockholders and non-controlling operating partnership unitholders, while diluted Core funds from operations were $16.899 million. The loss was $0.11 per share, compared with $0.11 income in the second quarter; diluted Core funds from operations per share declined to $0.35 from $0.38.

Why did Gladstone Commercial's Core FFO decline in the third quarter of 2026?

The company attributed the decline primarily to higher property expenses, higher interest expense as the SOFR benchmark rate increased, and a lease termination fee recognized in the previous quarter on a property sold then. Lower general and administrative expenses and a lower net incentive fee partly offset those factors.

How does Gladstone Commercial calculate Core FFO?

Core funds from operations adjusts funds from operations for items considered unrepresentative of the operating portfolio, including acquisition-related expenses, early debt-extinguishment gains or losses, and other nonrecurring expenses. Funds from operations excludes property-sale gains or losses and property impairments and adds back real estate depreciation and amortization. Neither measure substitutes for GAAP net income or operating cash flow.