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1. Company Snapshot

1.a. Company Description

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.Including payments through September 2020, Gladstone Commercial has paid 189 consecutive monthly cash distributions on its common stock.Prior to paying distributions on a monthly basis, Gladstone Commercial paid five consecutive quarterly cash distributions.


The company has also paid 53 consecutive monthly cash distributions on its Series D Preferred Stock, 12 consecutive monthly cash distributions on its Series E Preferred Stock and three consecutive monthly cash distributions on its Series F Preferred Stock.Gladstone Commercial has never skipped, reduced or deferred a distribution since its inception in 2003.

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1.b. Last Insights on GOOD

Gladstone Commercial Corporation faces negative drivers, including a decline in institutional investor confidence, as D.A. Davidson & CO. decreased its position by 8.9%. The company's fundamentals are weak, with declining cash flows and historically low dividends. Management's shift towards industrial properties may not be enough to offset these challenges. The upcoming Q3 2025 earnings report is expected to show $0.40 per share and $40.10 million in revenue. A sell rating has been recommended by some analysts due to the dismal future outlook (Source: sell Gladstone report).

1.c. Company Highlights

2. Gladstone Commercial's Q3 2025 Earnings: A Closer Look at Financial Performance and Growth Prospects

Gladstone Commercial Corporation reported operating revenues of $40.8 million for the third quarter of 2025, with operating expenses of $26 million, resulting in net assets of $1.265 billion. The company's funds from operations (FFO) and core FFO per share available to common stockholders were $0.35, below the estimated $0.39. Same-store lease revenues increased by 3.1% compared to the same period a year ago, driven by the company's continued focus on growing its industrial concentration. The actual EPS came out at $0.35 relative to estimates at $0.39.

Publication Date: Nov -17

📋 Highlights
  • Industrial Concentration Growth: Industrial assets now account for 69% of annualized straight-line rents, up from 63% at the start of 2025, driven by a $54.5M cross-regional manufacturing portfolio acquisition.
  • Portfolio Occupancy & Lease Terms: The acquired portfolio is 99.1% occupied with a weighted average lease term of 7.5 years, the longest since Q1 2020.
  • FFO Decline: Q3 2025 FFO/core FFO per share dropped to $0.35 from $0.38 in Q3 2024, and 9M FFO/core FFO fell to $1.02/$1.03 from $1.07/$1.08 in 2024.
  • Debt Structure & Credit Facility: 39% of debt is fixed-rate, 37% hedged floating-rate, and 24% floating-rate. The credit facility was upsized to $600M with a maturity extension to October 2029.
  • CapEx & Cap Rate Trends: CapEx spiked due to office leasing activity but is expected to decline. Acquired assets have an 8.5%+ cap rate, with a 65-basis-point expansion in the quarter.

Financial Highlights and Leverage

The company's industrial concentration has increased to 69% of annualized straight-line rents, up from 63% at the start of the year, following the acquisition of a 6-facility cross-regional industrial manufacturing portfolio via a $54.5 million sale-leaseback transaction. The company's leverage has increased year-over-year due to acquisitions, but management plans to issue more equity to bring leverage down, targeting not to exceed current levels. As of September 30, 39% of the company's debt was fixed-rate, 37% was hedge floating-rate, and 24% was floating-rate.

Valuation and Dividend Yield

With a P/E Ratio of 25.19 and a Dividend Yield of 10.71%, Gladstone Commercial's stock appears to be priced with a certain level of growth expectation. The company's ROE stands at 7.95%, and its Net Debt / EBITDA ratio is 3.14. Analysts estimate next year's revenue growth at 6.0%, which may impact the company's ability to sustain its dividend yield.

Growth Prospects and Capital Expenditures

Management expects to continue growing its industrial allocation beyond 70% and is focused on evaluating opportunities to acquire high-quality industrial assets. The company's capital expenditures (CapEx) were high in the quarter due to leasing activity, particularly in office space. However, they expect CapEx to decrease going forward as they have successfully re-leased several properties with upcoming expirations.

Acquisition Strategy and Cap Rates

The weighted average cap rate for acquisitions expanded by 65 basis points, but the company expects cap rates to compress with the recent Fed rate cut, and they are seeing good accretive opportunities with average cap rates above 8.5%. The company's cost of capital allows them to be expressive on the acquisition front, with a return hurdle of north of 8.5% and a plan to move up the chain in terms of deal size.

3. NewsRoom

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Contrasting Gladstone Commercial (NASDAQ:GOOD) and VICI Properties (NYSE:VICI)

Dec -03

Source: defenseworld.net

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Why I Am Buying Preferred Stocks Hand Over Fist; Yields +7%

Nov -28

Source: seekingalpha.com

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Gladstone Commercial (NASDAQ:GOOD) & CoreCivic (NYSE:CXW) Head-To-Head Comparison

Nov -22

Source: defenseworld.net

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Gladstone Commercial: Series G Preferred Shares Look Attractive

Nov -18

Source: seekingalpha.com

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Stonegate Capital Partners Updates 3Q25 Report on Gladstone Commercial Corp. (GOOD)

Nov -05

Source: newsfilecorp.com

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Why Gladstone Commercial Stock Sank by 6% Today

Nov -05

Source: fool.com

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Gladstone Commercial Corporation (GOOD) Q3 2025 Earnings Call Transcript

Nov -04

Source: seekingalpha.com

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Gladstone Commercial Corporation Reports Results for the Third Quarter Ended September 30, 2025

Nov -03

Source: accessnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.16%)

6. Segments

Lease - Same Store Properties

Expected Growth: 4.0%

Gladstone Commercial Corporation's 4.0% growth in Lease - Same Store Properties is driven by strong property operations, increasing occupancy rates, and rent growth. Effective asset management, strategic lease renewals, and a diversified tenant base also contribute to this growth. Additionally, the company's focus on industrial and office properties in strong markets supports the upward trend.

Lease - Acquired & Disposed Properties

Expected Growth: 4.65%

Gladstone Commercial Corporation's 4.65% growth in Lease - Acquired & Disposed Properties is driven by strategic property acquisitions, increasing demand for industrial and office spaces, and effective lease renewal and repositioning strategies. Additionally, the company's focus on high-growth markets and strong tenant relationships have contributed to the growth.

Lease - Properties with Vacancy

Expected Growth: 4.83%

Gladstone Commercial Corporation's 4.83% growth in Lease - Properties with Vacancy is driven by increasing demand for industrial and logistics spaces, strategic acquisitions, and effective asset management. Additionally, the company's focus on high-growth markets and strong tenant relationships contribute to its growth momentum.

7. Detailed Products

Office Properties

Gladstone Commercial Corporation owns and operates office properties, providing commercial real estate solutions to businesses and organizations.

Industrial Properties

The company offers industrial properties for lease, catering to businesses that require warehouse, manufacturing, or distribution facilities.

Retail Properties

Gladstone Commercial Corporation provides retail properties for businesses, including shopping centers, strip malls, and freestanding stores.

Mortgage Financing

The company offers mortgage financing solutions to property owners and investors, providing capital for property acquisitions and refinancing.

8. Gladstone Commercial Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Gladstone Commercial Corporation operates in a niche market with limited substitutes, reducing the threat of substitutes.

Bargaining Power Of Customers

Gladstone Commercial Corporation has a diversified customer base, reducing the bargaining power of individual customers.

Bargaining Power Of Suppliers

Gladstone Commercial Corporation has a moderate level of dependence on its suppliers, but has implemented strategies to mitigate this risk.

Threat Of New Entrants

Gladstone Commercial Corporation operates in a highly regulated industry, making it difficult for new entrants to enter the market.

Intensity Of Rivalry

Gladstone Commercial Corporation operates in a highly competitive industry, with many established players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 82.92%
Debt Cost 3.95%
Equity Weight 17.08%
Equity Cost 9.60%
WACC 4.91%
Leverage 485.36%

11. Quality Control: Gladstone Commercial Corporation passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Modiv

A-Score: 7.1/10

Value: 6.6

Growth: 7.8

Quality: 4.7

Yield: 10.0

Momentum: 6.0

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
Gladstone Commercial

A-Score: 6.4/10

Value: 5.3

Growth: 4.7

Quality: 6.9

Yield: 10.0

Momentum: 2.0

Volatility: 9.7

1-Year Total Return ->

View Full Report
Stock-Card
BrightSpire Capital

A-Score: 6.3/10

Value: 6.8

Growth: 4.6

Quality: 3.9

Yield: 10.0

Momentum: 5.0

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
Urban Edge

A-Score: 6.1/10

Value: 4.9

Growth: 3.1

Quality: 7.8

Yield: 8.0

Momentum: 4.0

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
American Assets Trust

A-Score: 5.7/10

Value: 5.2

Growth: 4.3

Quality: 4.7

Yield: 10.0

Momentum: 2.0

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Presidio Property Trust

A-Score: 2.8/10

Value: 5.6

Growth: 0.8

Quality: 2.6

Yield: 5.0

Momentum: 3.0

Volatility: 0.0

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

10.87$

Current Price

10.87$

Potential

-0.00%

Expected Cash-Flows