NYSE: NLOP
Net Lease Office PropertiesCIK 0001952976 · Real Estate Investment Trusts
Net Lease Office Properties (“NLOP” or the “Company”) is a Maryland real estate investment trust that, together with our consolidated subsidiaries, owns a diversified portfolio of office properties that are primarily leased to corporate tenants on a single-tenant, net-lease basis. Our net leases… About this business →
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About Net Lease Office Properties
Source: Item 1 (Business) from the 10-K filed February 25, 2026. Description as filed by the company with the SEC.
Item 1. Business.
General Development of Business
Net Lease Office Properties (“NLOP” or the “Company”) is a Maryland real estate investment trust that, together with our consolidated subsidiaries, owns a diversified portfolio of office properties that are primarily leased to corporate tenants on a single-tenant, net-lease basis. Our net leases generally specify a base rent with rent increases and require the tenant to pay substantially all costs associated with operating and maintaining the property. We elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code (the “Code”) effective as of November 1, 2023.
The vast majority of our revenues originate from lease revenue provided by our real estate portfolio, which comprises single-tenant office facilities that are critical to our tenants’ operations. As of December 31, 2025, our portfolio comprised 24 properties, net-leased to 26 corporate tenants operating in a variety of industries, generating annualized base rent (“ABR”) of approximately $54.1 million. As of December 31, 2025, all of our properties were located in the United States. In January and February 2026, we sold four properties, including a property leased to our largest tenant (based on ABR as of December 31, 2025) (Note 17).
Pursuant to the terms of a separation and distribution agreement, W. P. Carey Inc. (“WPC”), a leading net-lease REIT listed on the New York Stock Exchange (“NYSE”) under the ticker symbol “WPC,” spun off a portfolio of 59 office assets into a separate publicly-traded company (the “Spin-Off”). To accomplish this Spin-Off, WPC formed NLOP on October 21, 2022. On November 1, 2023, WPC completed the Spin-Off. Following the closing of the Spin-Off, certain wholly-owned affiliates of WPC (our “Advisor”) externally manage NLOP pursuant to certain advisory agreements (the “NLOP Advisory Agreements”). The Spin-Off was accomplished via a pro rata dividend of 1 NLOP common share for every 15 shares of WPC common stock outstanding.
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Our common shares are listed on the NYSE under the ticker symbol “NLOP.”
Narrative Description of Business
Business Objectives and Strategy
Our business plan is to focus on realizing value for our shareholders primarily through strategic asset management and disposition of our property portfolio over time. Our Advisor is generally responsible for all aspects of our operations including but not limited to formulating and evaluating the terms of each proposed disposition, arranging and executing the disposition of each asset, negotiating and monitoring the terms of our borrowings, preparing and filing our financial statements and required filings with the SEC, and other management services, under the supervision of our Board of Trustees (our “Board”). We anticipate using the proceeds of dispositions to pay distributions to our shareholders, pay down debt, and reinvest in our properties through capital expenditures, as needed.
Financing Strategies
On September 20, 2023, in connection with the Spin-Off, we and certain of our wholly-owned subsidiaries entered into financing arrangements for which funding was subject to certain conditions (including the closing of the Spin-Off), including (i) a $335.0 million senior secured mortgage loan maturing on November 9, 2025, subject to two separate one-year extension options (the “NLOP Mortgage Loan”) and (ii) a $120.0 million mezzanine loan facility maturing on November 9, 2028 (the “NLOP Mezzanine Loan” and, together with the NLOP Mortgage Loan, the “NLOP Financing Arrangements”). The NLOP Financing Arrangements were initially collateralized by the assignment of certain of our previously unencumbered real estate properties. The NLOP Mortgage Loan was repaid during 2024 and the NLOP Mezzanine Loan was repaid during 2025 (as discussed below).
The funding of the NLOP Financing Arrangements occurred on November 1, 2023 (the date of the Spin-Off). We borrowed an aggregate of $455.0 million and each of the NLOP Mortgage Loan and the NLOP Mezzanine Loan was fully drawn. Approximately $343.9 million of the proceeds from the financing (net of transaction expenses) was transferred to WPC in connection with the Spin-Off.
Net Lease Office Properties 2025 10-K – 3
The NLOP Financing Arrangements were structured, in part, to provide us with the ability to engage in dispositions of assets as contemplated by our overall strategy. We fully repaid the NLOP Mortgage Loan during 2024, with proceeds from such dispositions, as well as cash flow from rent on our properties and other sources. We fully repaid the NLOP Mezzanine Loan during 2025, using net proceeds from such dispositions, as well as excess cash flow from operations and other sources, including the application of loan reserves.
As of December 31, 2025, one additional property was encumbered by an outstanding individual mortgage of $21.9 million. We intend to repay or refinance this mortgage at maturity. We may also consider other options, including other forms of debt, additional mortgages, or leverage when available.
Our Portfolio
At December 31, 2025, our portfolio had the following characteristics:
•Number of properties — full or partial ownership interests in 24 net-leased properties;
•Total net-leased square footage — approximately 3.4 million; and
•Occupancy rate — approximately 79.0%.
For more information about our portfolio, see Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Portfolio Overview.
Tenant/Lease Information
At December 31, 2025, our tenants/leases had the following characteristics:
•Number of tenants — 26;
•Investment grade tenants as a percentage of total ABR — 20%;
•Implied investment grade tenants as a percentage of total ABR — 11%;
•Weighted-average lease term (“WALT”) — 3.9 years;
•91.6% of our leases as a percentage of total ABR provide rent adjustments as follows:
◦Fixed — 76.0%
◦Consumer Price Index (“CPI”) and similar — 15.3%
◦Other — 0.3%
Human Capital
We have no employees. However, employees of WPC are available to perform services under our Advisory Agreements. Our Advisory Agreements do not require the Advisor to dedicate any particular employees to us.
Available Information
We will supply to any shareholder, upon written request and without charge, a copy of this Report as filed with the SEC. Our filings can also be obtained for free on the SEC’s website at http://www.sec.gov. All filings we make with the SEC, including this Report, our quarterly reports on Form 10-Q, and our current reports on Form 8-K, as well as any amendments to those reports, are available for free on the Investor Relations portion of our website (http://www.nloproperties.com), as soon as reasonably practicable after they are filed with or furnished to the SEC.
Our Code of Business Conduct and Ethics, which applies to all trustees, officers, and employees, including our chief executive officer and chief financial officer, is also available on our website. We intend to make available on our website all disclosures that are required under the Securities Exchange Act of 1934 (the “Exchange Act”) or NYSE listing standards concerning amendments or waivers to our Code of Business Conduct and Ethics. We are providing our website address solely for the information of investors and do not intend for it to be an active link. We do not intend to incorporate the information contained on our website into this Report or other documents filed with or furnished to the SEC.
Net Lease Office Properties 2025 10-K – 4