GENERATION INCOME PROPERTIES INC
For the period ended Jun 30, 2024. Filed Aug 15, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 15, 2024
GIPR$0.25-2.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-20.
0000950170-24-062478
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-15.
0000950170-24-097282
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 90 previous paragraphs and 92 current paragraphs.
60 unchanged; 30 reworded; 2 added; 0 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 5 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (2)
Current report
On June 27, 2024, the Operating Partnership and an accredited investor entered into a Unit Purchase Agreement (the “June 2024 Unit Purchase Agreement”) pursuant to which the Operating Partnership issued and sold to the investor 500,000 Series A Preferred Units at a price of $5.00 per unit for an aggregate purchase price of two million five hundred thousand dollars ($2,500,000) in cash. Under the terms of the Series A Preferred Units, the investor will be paid cumulative cash distributions in the amount of $0.325 per Series A Preferred Unit per year, payable monthly in arrears, on or about the 15th day of each month. Each of the investor and the Operating Partnership will have the right to cause the Operating Partnership to redeem the Series A Preferred Units after two (2) years for cash in an amount equal to $5.15 per Series A Preferred Unit plus any accrued but unpaid Series A Preferred Return, provided that the Operating Partnership may (with the prior written consent of the investor) cause the redemption orice to be satisfied by the issuance of a number of shares of common stock of the Company equal to the number of Series A Preferred Units being redeemed multiplied by 1.03 plus any accrued but unpaid Series A Preferred Return. If the Operating Partnership fails to declare and pay the Series A Preferred Return for a period of three consecutive months, the investor may exercise the foregoing redemption right within the 30-day period following such failure.
Current report
On June 27, 2024, the Operating Partnership and an accredited investor entered into a Unit Purchase Agreement (the “June 2024 Unit Purchase Agreement”) pursuant to which the Operating Partnership issued and sold to the investor 500,000 Series A Preferred Units at a price of $5.00 per unit for an aggregate purchase price of two million five hundred thousand dollars ($2,500,000) in cash. Under the terms of the Series A Preferred Units, the investor will be paid cumulative cash distributions in the amount of $0.325 per Series A Preferred Unit per year, payable monthly in arrears, on or about the 15th day of each month. Each of the investor and the Operating Partnership will have the right to cause the Operating Partnership to redeem the Series A Preferred Units after two (2) years for cash in an amount equal to $5.15 per Series A Preferred Unit plus any accrued but unpaid Series A Preferred Return, provided that the Operating Partnership may (with the prior written consent of the investor) cause the redemption orice to be satisfied by the issuance of a number of shares of common stock of the Company equal to the number of Series A Preferred Units being redeemed multiplied by 1.03 plus any accrued but unpaid Series A Preferred Return. If the Operating Partnership fails to declare and pay the Series A Preferred Return for a period of three consecutive months, the investor may exercise the foregoing redemption right within the 30-day period following such failure.
Reworded paragraphs (30)
Previous wording
Creditworthy Tenants. Approximately 65% of our portfolio’s annualized base rent ("ABR") as of March 31, 2024 was derived from tenants that have (or whose parent company has) an investment grade credit rating from a recognized credit rating agency of “BBB-” or better. Our largest tenants are the General Service Administration, Dollar General, EXP Services, and Kohl’s Corporation and contributed approximately 63% of our portfolio’s annualized base rent.
Current wording
Creditworthy Tenants. Approximately 60% of our portfolio’s annualized base rent ("ABR") as of June 30, 2024 was derived from tenants that have (or whose parent company has) an investment grade credit rating from a recognized credit rating agency of “BBB-” or better. Our largest tenants are the General Service Administration, Dollar General, EXP Services, and Kohl’s Corporation, PRA Holdings, and City of San Antonio contributed approximately 69% of our portfolio’s annualized base rent.
Previous wording
% Leased. Our portfolio is 93% leased and occupied.
Current wording
% Leased. Our portfolio is 89% leased and occupied.
Previous wording
Contractual Rent Growth. Approximately 91% of the leases in our current portfolio (based on ABR as of March 31, 2024) provide for increases in contractual base rent during future years of the current term or during the lease extension periods.
Current wording
Contractual Rent Growth. Approximately 92% of the leases in our current portfolio (based on ABR as of June 30, 2024) provide for increases in contractual base rent during future years of the current term or during the lease extension periods.
Previous wording
Average Effective Annual Rental per Square Foot. Average effective annual rental per square foot is 14.75.
Current wording
Average Effective Annual Rental per Square Foot. Average effective annual rental per square foot is $14.75.
Previous wording
From inception through March 31, 2024, we have distributed $4,397,141 to common stockholders.
Current wording
From inception through June 30, 2024, we have distributed $5,031,549 to common stockholders. On July 3, 2024, the Company announced that its Board of Directors determined to suspend the Company’s regular dividend, commencing with the monthly dividends that would have been paid in July 2024.
Previous wording
On April 4, 2024, we announced that our Board of Directors authorized a distribution of $0.039 per share monthly cash distribution for shareholders of record of our common stock as of April 15, 2024. April distributions were paid on May 1, 2024 and we anticipate May distributions to be paid on or around May 31, 2024. The Operating Partnership common unit holders receive the same distribution.
Current wording
On April 4, 2024, May 3, 2024, and June 3, 2024, respectively, we announced that our Board of Directors authorized a distribution of $0.039 per share monthly cash distribution for shareholders of record of our common stock as of April 15, 2024, May 15, 2024 and June 15, 2024, respectively. Distributions for April, May and June 2024 were paid on April 30, May 30, and June 28, 2024, respectively. The Operating Partnership common unit holders received the same distribution. On July 3, 2024, the Company announced that its Board of Directors determined to suspend the Company’s regular dividend, commencing with the monthly dividends that would have been paid in July 2024.
Previous wording
Operating results for the three months ended March 31, 2024 compared to the three months ended March 31, 2023:
Current wording
Operating results for the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023:
Previous wording
During the three months ended March 31, 2024, total revenue from operations was 2,433,173 as compared to $1,337,039 for the three months ended March 31, 2023. Revenue increased by $1,096,134 during the three months ended March 31, 2024 compared with the three months ended March 31, 2023 driven by the integration of the acquired 13 property portfolio from Modiv.
Current wording
During the three and six months ended June 30, 2024, total revenue from operations were 2,259,234 and $4,692,407, respectively, as compared to $1,328,878 and 2,665,917 for the three and six months ended June 30, 2023, respectively. Revenue increased by $930,356 and $2,026,490 during the three and six months ended June 30, 2024, respectively, compared with the three and six months ended June 30, 2023. The overall revenue increase was driven by the integration of the 13 property portfolio acquired from Modiv in August 2023.
Previous wording
During the three months ended March 31, 2024, we incurred total operating expenses of $3,633,825 as compared to $2,035,794 for the three months ended March 31, 2023. Operating expenses increased by $1,598,031 as follows:
Current wording
During the three and six months ended June 30, 2024, we incurred total operating expenses of $3,729,846 and $7,363,672, respectively, as compared to $1,986,715 and $4,022,509, respectively, for the three and six months ended June 30, 2023. Operating expenses increased overall by $1,743,131 and $3,341,163, respectively, as follows:
Previous wording
General, administrative and organizational costs increased by $105,650 driven by an increase in accounting, audit and tax fees during the three months ended March 31, 2024.
Current wording
General, administrative and organizational costs increased by $245,667 and $351,317 driven by an increase in accounting, audit and tax fees during the three and six months ended June 30, 2024, respectively.
Previous wording
Building expenses increased by $341,067 due to an overall increase driven by the integration of the acquired 13 property portfolio from Modiv in August 2023 compared the portfolio in operation during the three months ended March 31, 2023.
Current wording
Building expenses increased by $363,372 and $704,439 during the three and six months ended June 30, 2024, due to an overall increase driven by the integration of the acquired 13 property portfolio from Modiv in August 2023, compared to the portfolio in operation during the three and six months ended June 30, 2023.
Previous wording
Depreciation and amortization increased by $669,055 driven by the integration of the since acquired 13 property portfolio from Modiv compared the portfolio in operation during the three months ended March 31, 2023.
Current wording
Depreciation and amortization increased by $622,232 and $1,291,286 during the three and six months ended June 30, 2024, driven by the integration of the since acquired 13 property portfolio from Modiv compared with the portfolio in operation during the three and six months ended June 30, 2023.
Previous wording
Interest expense, net increased by $551,531 driven by the incremental interest expense of approximately $390,000 for the three months ended March 31, 2024, due to Company's borrowing of approximately $21 million of mortgage debt secured by the acquired 13 property portfolio. An additional incremental increase is the result of the guaranty fee expense to the Company's CEO of $97,898 recorded to interest expense during the three months ended March 31, 2024. Guaranty fee expense incurred during the three months ended March 31, 2023 was $60,493.
Current wording
Interest expense, net increased by $556,389 and $1,107,920 during the three and six months ended June 30, 2024 due to Company's borrowing of approximately $21 million of mortgage debt secured by the acquired 13 property portfolio. An additional incremental increase is the result of the guaranty fee expense to the Company's CEO of $96,360 and $192,712 recorded to interest expense during the three and six months ended June 30, 2024, respectively. Guaranty fee expense incurred and recorded to interest expense during the three and six months ended June 30, 2023 was $55,652 and $116,145, respectively.
Previous wording
Compensation costs decreased by $69,272 primarily due to savings in salary expense and for accounting and administrative staff.
Current wording
Compensation costs decreased by $44,528 and $$113,800, respectively, primarily due to savings in salary expense and for accounting and administrative staff.
Previous wording
During the three months ended March 31, 2024 and 2023, we generated a net loss of $1,879,096 and $1,190,353, respectively.
Current wording
During the three and six months ended June 30, 2024 and 2023, we generated a net loss of $1,461,488 and $752,397 and $3,340,584 and 1,942,750, respectively.
Previous wording
During the three months ended March 31, 2024 and 2023, net income attributable to non-controlling interest was $946,124 and $127,214, respectively. The variance is attributable to additional redeemable non-controlling interests established during the second half of fiscal year 2023 to facilitate acquisitions, namely the acquisition of the 13 property Modiv portfolio in August 2023.
Current wording
During the three and six months ended June 30, 2024 and 2023, net income attributable to non-controlling interest was $800,234 and $129,065 and $1,746,358 and $256,279, respectively. The variance is attributable to additional redeemable non-controlling interests established during the second half of fiscal year 2023 to facilitate acquisitions, namely the acquisition of the 13 property Modiv portfolio in August 2023.
Previous wording
During the three months ended March 31, 2024 and 2023, we generated a net loss attributable to our shareholders of $2,920,220 and $1,317,567, respectively.
Current wording
During the three and six months ended June 30, 2024 and 2023, we generated a net loss attributable to our shareholders of $2,261,722 and $881,462 and $5,181,943 and 2,199,029, respectively.
Previous wording
We require capital to fund our investment activities and operating expenses. Our capital sources may include net proceeds from offerings of our equity securities, cash flow from operations and borrowings under credit facilities. As of March 31, 2024, we had total cash (unrestricted and restricted) of $1,690,320, properties with a gross cost basis of $96,539,788 and outstanding mortgage loans with a principal balance of $57,823,894.
Current wording
We require capital to fund our investment activities and operating expenses. Our capital sources may include net proceeds from offerings of our equity securities, cash flow from operations and borrowings under credit facilities. As of June 30, 2024, we had total cash (unrestricted and restricted) of $2,587,734, properties with a gross cost basis of $96,686,513 and outstanding mortgage loans with a principal balance of $57,504,073.
Previous wording
Our President and CEO has also personally guaranteed the repayment of the $10.7 million due under the 7-11 - Washington, DC; Starbucks - South Tampa, FL; and vacant - Huntsville, AL loan as well as the $1.3 million loan secured by the Company's Sherwin-Williams - Tampa, FL property. In addition, our President and CEO has also provided a guaranty of the Company’s nonrecourse carveout liabilities and obligations in favor of the lender for the GSA and PRA Holdings, Inc. - Norfolk, VA mortgage loans ("Bayport loans") with an aggregate principal amount of $11.8 million.
Current wording
Our President and CEO has also personally guaranteed the repayment of the $10.7 million due under the 7-11 - Washington, DC; Starbucks - South Tampa, FL; and vacant - Huntsville, AL loan as well as the $1.3 million loan secured by the Company's Sherwin-Williams - Tampa, FL property. In addition, our President and CEO has also provided a guaranty of the Company’s nonrecourse carveout liabilities and obligations in favor of the lender for the GSA and PRA Holdings, Inc. - Norfolk, VA mortgage loans ("Bayport loans") with an aggregate principal amount of $11.7 million.
Previous wording
During the three months ended March 31, 2024, we incurred a guaranty fee expense to our President and CEO of $97,898 recorded to interest expense. A guaranty fee expense of $60,493 incurred during the three months ended March 31, 2023.
Current wording
During the three and six months ended June 30, 2024, we incurred a guaranty fee expense to our President and CEO of $96,360 and 192,712, respectively, recorded to interest expense. A guaranty fee expense of $55,652 and $116,145 was incurred during the three and six months ended June 30, 2023, respectively.
Previous wording
On August 9, 2022, we entered a Redemption Agreement with a unit holder. As such, we recorded an other payable - related party in the amount of $2,912,300 upon execution of the Redemption Agreement entered into July 20, 2022 and has since made installment payments of $1,554,920 to date with a remaining balance of $1,357,380 outstanding as of March 31, 2024.
Current wording
On August 9, 2022, we entered a Redemption Agreement with a unit holder. As such, we recorded another payable - related party in the amount of $2,912,300 upon execution of the Redemption Agreement entered into July 20, 2022 and has since made installment payments of $2,007,380 to date with a remaining balance of $904,920 outstanding as of June 30, 2024.
Previous wording
On October 14, 2022, we entered into a loan transaction that is evidenced by a secured non-convertible promissory note to Brown Family Enterprises, LLC, a preferred equity partner and therefore a related party, for $1.5 million that is due on October 14, 2024, and bears a fixed interest rate of 9%, simple interest. Interest is payable monthly. On July 21, 2023, the Company amended and restated the promissory note to reflect an increase in the loan to $5.5 million and extend the maturity date thereof from October 14, 2024 to October 14, 2026. Except for the increase in the amount of the Loan and Note and the extension of the maturity date thereof, no changes were made to the original note. The loan may be repaid without penalty at any time. The loan is secured by the Operating Partnership’s equity interest in its current direct subsidiaries that hold real estate assets pursuant to the terms of a security agreement between the Operating Partnership and Brown Family Enterprises, LLC.
Current wording
On October 14, 2022, we entered into a loan transaction that is evidenced by a secured non-convertible promissory note to Brown Family Enterprises, LLC, a preferred equity partner and therefore a related party, for $1.5 million that is due on October 14, 2024, and bears a fixed interest rate of 9% with simple interest payable monthly. On July 21, 2023, the Company amended and restated the promissory note to reflect an increase in the loan to $5.5 million and extend the maturity date thereof from October 14, 2024 to October 14, 2026. Except for the increase in the amount of the Loan and Note and the extension of the maturity date thereof, no changes were made to the original note. The loan may be repaid without penalty at any time. The loan is secured by the Operating Partnership’s equity interest in its current direct subsidiaries that hold real estate assets pursuant to the terms of a security agreement between the Operating Partnership and Brown Family Enterprises, LLC.
Previous wording
We amortized debt issuance costs during the three months ended March 31, 2024 and 2023 to interest expense of approximately $47,780 and $28,865, respectively. The Company did not pay any debt issuance costs during the three months ended March 31, 2024 and 2023.
Current wording
We amortized debt issuance costs during the three and six months ended June 30, 2024 and 2023 to interest expense of approximately $47,780 and $28,865 and $95,560 and $57,730, respectively. The Company did not pay any debt issuance costs during the six months ended June 30, 2024 and 2023.
Previous wording
Each mortgage loan requires the Company to maintain certain debt service coverage ratios as noted above. In addition, two mortgage loans, one encumbered by six properties and requiring a 1.50 DSCR, and another stand alone mortgage loan requiring a 1.50 DSCR, require the Company to maintain a 54% loan to fair market stabilized value ratio. Fair market stabilized value shall be determined by the lender by reference to acceptable guides and indices or appraisals from time to time at its discretion. As of March 31, 2024, we were in compliance with all covenants, with the exception of one project level DSCR covenant for 2510 Walmer Ave. Our Bayport Credit Union loan covenant requires project level, property level and portfolio level DSCR minimum testing. At the project-level, 2510 Walmer Ave tested at a 1.17:1 DSCR, compared with the 1.25:1 project level minimum DSCR, driven by its vacancy since January 2023. According to the governing loan document, failing to meet DSCR coverage requirements is a technical default triggering the risk of forfeiture of the property, accelerating the repayment of the remaining outstanding balance of the loan at the lender's discretion. All other DSCR covenants tested compliant and the lender has indicated no intention of action. Additionally, a new lease was executed for 2510 Walmer Ave. on March 28, 2024 and will restore the property to full occupancy upon commencement on May 1, 2024.
Current wording
Each mortgage loan requires the Company to maintain certain debt service coverage ratios as noted above. In addition, two mortgage loans, one encumbered by six properties and requiring a 1.50 DSCR, and another stand alone mortgage loan requiring a 1.50 DSCR, require the Company to maintain a 54% loan to fair market stabilized value ratio. Fair market stabilized value shall be determined by the lender by reference to acceptable guides and indices or appraisals from time to time at its discretion. As of June 30, 2024, we were in compliance with all covenants, with the exception of one project level DSCR covenant for 2510 Walmer Ave. Our Bayport Credit Union loan covenant requires project level, property level and portfolio level DSCR minimum testing. At the project-level, 2510 Walmer Ave tested at a 1.17:1 DSCR, compared with the 1.25:1 project level minimum DSCR, driven by its vacancy since January 2023. According to the governing loan document, failing to meet DSCR coverage requirements is a technical default triggering the risk of forfeiture of the property, accelerating the repayment of the remaining outstanding balance of the loan at the lender's discretion. All other DSCR covenants tested compliant and the lender has indicated no intention of action. Additionally, a new lease was executed for 2510 Walmer Ave. on March 28, 2024 and the the property has been restored to full occupancy as of May 1, 2024.
Previous wording
On February 8, 2023, we entered into new Amended and Restated Limited Liability Company Agreements for the Norfolk, Virginia properties, GIPVA 2510 Walmer Ave, LLC ("GIPVA 2510") and GIPVA 130 Corporate Blvd, LLC ("GIPVA 130"), in which we, as the sole member of GIPVA 2510 and GIPVA 130, admitted a new preferred member, Brown Family Enterprises, LLC, through the issuance of preferred membership interests in the form of Class A Preferred Units of GIPVA 2510 and GIPVA 130. GIPVA 2510 and GIPVA 130 (the “Virginia SPEs”) hold our Norfolk, Virginia properties. In addition, both of the Virginia SPEs and Brown Family Enterprises, LLC entered into Unit Purchase Agreements in which GIPVA 2510 issued and sold 180,000 Class A Preferred Units at a price of $10.00 per unit for an aggregate price of $1,800,000, and GIPVA 130 issued and sold 120,000 Class A Preferred Units at a price of $10.00 per unit for an aggregate price of $1,200,000. The Operating Partnership is the general manager of the subsidiary while Brown Family Enterprises, LLC is a preferred equity member. Pursuant to the agreement, we are required to pay the preferred equity member a 7% IRR paid on a monthly basis and will share in 16% of the equity in each of the Virginia SPEs upon a capital transaction resulting in distributable proceeds. After 24 months, Brown Family Enterprises, LLC has the right to redeem the preferred equity at redemption value. Because of the redemption right, the non-controlling interest is presented as temporary equity at an aggregated redemption value of $3,000,000 as of March 31, 2024.
Current wording
On February 8, 2023, we entered into new Amended and Restated Limited Liability Company Agreements for the Norfolk, Virginia properties, GIPVA 2510 Walmer Ave, LLC ("GIPVA 2510") and GIPVA 130 Corporate Blvd, LLC ("GIPVA 130"), in which we, as the sole member of GIPVA 2510 and GIPVA 130, admitted a new preferred member, Brown Family Enterprises, LLC, through the issuance of preferred membership interests in the form of Class A Preferred Units of GIPVA 2510 and GIPVA 130. GIPVA 2510 and GIPVA 130 (the “Virginia SPEs”) hold our Norfolk, Virginia properties. In addition, both of the Virginia SPEs and Brown Family Enterprises, LLC entered into Unit Purchase Agreements in which GIPVA 2510 issued and sold 180,000 Class A Preferred Units at a price of $10.00 per unit for an aggregate price of $1,800,000, and GIPVA 130 issued and sold 120,000 Class A Preferred Units at a price of $10.00 per unit for an aggregate price of $1,200,000. The Operating Partnership is the general manager of the subsidiary while Brown Family Enterprises, LLC is a preferred equity member. Pursuant to the agreement, we are required to pay the preferred equity member a 7% IRR paid on a monthly basis and will share in 16% of the equity in each of the Virginia SPEs upon a capital transaction resulting in distributable proceeds. After 24 months, Brown Family Enterprises, LLC has the right to redeem the preferred equity at redemption value. On July 25, 2024, we entered into First Amendments to the Second Amended and Restated Limited Liability Company Agreements, dated as of February 8, 2023, for each of these entities revising the redemption date from February 8, 2025 to February 8, 2027. Because of the redemption right, the non-controlling interest is presented as temporary equity at an aggregated redemption value of $3,000,000 as of June 30, 2024.
Previous wording
Due to the redemption right, the Preferred Interest is presented as temporary equity at redemption value of $14,100,000 plus accrued but unpaid preferred interest of $1,288,726 as of March 31, 2024.
Current wording
Due to the redemption right, the Preferred Interest is presented as temporary equity at redemption value of $14,100,000 plus accrued but unpaid preferred interest of $1,817,478 as of June 30, 2024.
Previous wording
Net cash provided by operating activities was $25,977 and net cash used in operating activities was $850,964 for the three months ended March 31, 2024 and 2023, respectively. The change is due to the doubling of the number of the Company's income generating assets through the 13 property Modiv acquisition.
Current wording
Net cash provided by operating activities was $226,605 and net cash used in operating activities was $528,151 for the six months ended June 30, 2024 and 2023, respectively. The change is due to the doubling of the number of the Company's income generating assets through the 13 property Modiv acquisition.
Previous wording
Net cash used in investing activities during the three months ended March 31, 2024 was $0. Net cash used in investing activities was $50,000 during the three months ended March 31, 2023 related to an escrow deposit for a property purchase.
Current wording
Net cash used in investing activities during the three and six months ended June 30, 2024 was $0. Net cash used in investing activities was $188,854 during the six months ended June 30, 2023 related to an escrow deposit for a property purchase.
Previous wording
Net cash used in financing activities was $1,487,603 and $80,387 for the three months ended March 31, 2024 and 2023, respectively. The change is due to several factors comprising the increase of mortgage principal repayments driven by the Modiv acquisition in August 2023, the increase in distributions to non-controlling interests, and dividend payments on both preferred and common stock.
Current wording
Net cash used in financing activities was $790,817 and $896,099 for the six months ended June 30, 2024 and 2023, respectively. The change is due to several factors comprising the increase of mortgage principal repayments driven by the Modiv acquisition in August 2023, the increase in distributions to non-controlling interests, and dividend payments on both preferred and common stock.
Previous wording
We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT"). NAREIT defines FFO as GAAP net income or loss adjusted to exclude non-recurring or extraordinary items (as defined by GAAP), net gains from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets, and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries. We then adjust FFO for non-cash revenues and expenses such as amortization of deferred financing costs, above and below market lease intangible amortization, straight line rent adjustment where the Company is both the lessor and lessee, and non-cash stock compensation to calculate Core AFFO.
Current wording
We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT"). NAREIT defines FFO as GAAP net income or loss adjusted to exclude, net gains from sales of property and adding back real estate depreciation; namely, excluding from net income depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by an entity. We then adjust FFO for non-cash revenues and expenses such as amortization of deferred financing costs, above and below market lease intangible amortization, straight line rent adjustment where the Company is both the lessor and lessee, and non-cash stock compensation to calculate Core AFFO.