Postal Realty Trust Inc

Previous wording

We were formed as a Maryland corporation on November 19, 2018 and commenced operations upon completion of our initial public offering and the related formation transactions. We conduct our business through a traditional UPREIT structure in which our properties are owned by our Operating Partnership directly or through limited partnerships, limited liability companies or other subsidiaries. During the three months ended March 31, 2024, we acquired 29 properties leased to the USPS for approximately $18.9 million, including closing costs. As of March 31, 2024, our portfolio consists of 1,537 owned properties, located in 49 states and one territory and comprising approximately 6.0 million net leasable interior square feet.

Current wording

We were formed as a Maryland corporation on November 19, 2018 and commenced operations upon completion of our initial public offering and the related formation transactions. We conduct our business through a traditional UPREIT structure in which our properties are owned by our Operating Partnership directly or through limited partnerships, limited liability companies or other subsidiaries. During the six months ended June 30, 2024, we acquired 99 properties leased to the USPS for approximately $47.7 million, including closing costs. As of June 30, 2024, our portfolio consists of 1,607 owned properties, located in 49 states and one territory and comprising approximately 6.2 million net leasable interior square feet.

Previous wording

We are the sole general partner of our Operating Partnership through which our properties are directly or indirectly owned. As of May 7, 2024, we owned approximately 79.2% of outstanding common units of limited partnership interest in our Operating Partnership (the “OP Units”), including long term incentive units of our Operating Partnership (the “LTIP Units”). Our Board of Directors oversees our business and affairs.

Current wording

We are the sole general partner of our Operating Partnership through which our properties are directly or indirectly owned. As of August 2, 2024, we owned approximately 79.4% of outstanding common units of limited partnership interest in our Operating Partnership (the “OP Units”), including long term incentive units of our Operating Partnership (the “LTIP Units”). Our Board of Directors oversees our business and affairs.

Previous wording

On November 4, 2022, we entered into separate open market sale agreements for our at-the-market offering program (the "ATM Program") with each of Jefferies LLC, BMO Capital Markets Corp., Stifel, Nicolaus & Company, Incorporated and Truist Securities, Inc., as agents, pursuant to which we may offer and sell, from time to time, shares of our Class A common stock having an aggregate sales price of up to $50.0 million. The agreements also provide that we may enter into one or more forward sale agreements under separate master forward confirmations and related supplemental confirmations with affiliates of certain agents. On August 8, 2023, we amended the ATM Program to increase the aggregate offering amount under the program from up to $50.0 million to up to $150.0 million. During the three months ended March 31, 2024, 576,087 shares were issued under the ATM Program for approximately $8.2 million in gross proceeds. As of March 31, 2024, we had approximately $105.8 million of availability remaining under the ATM Program.

Current wording

On November 4, 2022, we entered into separate open market sale agreements for our at-the-market offering program (the "ATM Program") with each of Jefferies LLC, BMO Capital Markets Corp., Stifel, Nicolaus & Company, Incorporated and Truist Securities, Inc., as agents, pursuant to which we may offer and sell, from time to time, shares of our Class A common stock having an aggregate sales price of up to $50.0 million. The agreements also provide that we may enter into one or more forward sale agreements under separate master forward confirmations and related supplemental confirmations with affiliates of certain agents. On August 8, 2023, we amended the ATM Program to increase the aggregate offering amount under the program from up to $50.0 million to up to $150.0 million. During the six months ended June 30, 2024, 634,080 shares were issued under the ATM Program for approximately $9.0 million in gross proceeds. As of June 30, 2024, we had approximately $105.0 million of availability remaining under the ATM Program.

Previous wording

As of March 31, 2024, we owned a portfolio of 1,537 properties located in 49 states and one territory and leased primarily to the USPS. For the three months ended March 31, 2024, approximately 12.4% of our total rental income was concentrated in Pennsylvania.

Current wording

As of June 30, 2024, we owned a portfolio of 1,607 properties located in 49 states and one territory and leased primarily to the USPS. For the six months ended June 30, 2024, approximately 12.2% of our total rental income was concentrated in Pennsylvania.

Previous wording

All equity-based compensation expense is recognized in our Consolidated Statements of Operations and Comprehensive Income (Loss) as components of general and administrative expense and property operating expenses. We issue share-based awards to align our directors' and employees’ interests with those of our investors.

Current wording

All equity-based compensation expense is recognized in our Consolidated Statements of Operations and Comprehensive Income as components of general and administrative expense and property operating expenses. We issue share-based awards to align our directors' and employees’ interests with those of our investors.

Previous wording

As of May 7, 2024, the leases at 101of our properties, representing approximately 673,000 net leasable interior square feet, had expired and the USPS was occupying such properties as a holdover tenant. As of the date of this report, the USPS had not vacated or notified us of its intention to vacate any of these properties. When a lease expires, the USPS becomes a holdover tenant on a month-to-month basis typically paying the greater of estimated market rent or the rent amount under the expired lease.

Current wording

As of July 29, 2024, the leases at 83 of our properties, representing approximately 701,000 net leasable interior square feet, had expired and the USPS was occupying such properties as a holdover tenant. As of the date of this report, the USPS had not vacated or notified us of its intention to vacate any of these properties. When a lease expires, the USPS becomes a holdover tenant on a month-to-month basis typically paying the greater of estimated market rent or the rent amount under the expired lease.

Previous wording

Rental income – Rental income includes net rental income as well as the recovery of certain operating costs and property taxes from tenants. Rental income increased by $2.1 million to $16.6 million for the three months ended March 31, 2024 from $14.5 million for the three months ended March 31, 2023, primarily due to the volume of our acquisitions.

Current wording

Rental income – Rental income includes net rental income as well as the recovery of certain operating costs and property taxes from tenants. Rental income increased by $2.6 million to $17.4 million for the three months ended June 30, 2024 from $14.8 million for the three months ended June 30, 2023, primarily due to the volume of our acquisitions.

Previous wording

Real estate taxes – Real estate taxes increased by $0.3 million to $2.3 million for the three months ended March 31, 2024 from $2.0 million for the three months ended March 31, 2023, primarily due to the volume of our acquisitions.

Current wording

Real estate taxes – Real estate taxes increased by $0.4 million to $2.4 million for the three months ended June 30, 2024 from $2.0 million for the three months ended June 30, 2023, primarily due to the volume of our acquisitions.

Previous wording

Property operating expenses – Property operating expenses increased by $0.7 million to $2.4 million for the three months ended March 31, 2024 from $1.6 million for the three months ended March 31, 2023. Property management expenses are included within property operating expenses and increased by $0.1 million to $0.9 million for the three months ended March 31, 2024 from $0.8 million for the three months ended March 31, 2023. The remainder of the increase in property operating expenses of $0.5 million was related to an increase in insurance and repairs and maintenance expenses.

Current wording

Property operating expenses – Property operating expenses increased by $0.7 million to $2.1 million for the three months ended June 30, 2024 from $1.4 million for the three months ended June 30, 2023. Property management expenses are included within property operating expenses and increased by $0.2 million to $0.7 million for the three months ended June 30, 2024 from $0.5 million for the three months ended June 30, 2023. The remainder of the increase in property operating expenses of $0.5 million was related to an increase in insurance and repairs and maintenance expenses.

Previous wording

General and administrative– General and administrative expenses increased by $0.1 million to $4.3 million for the three months ended March 31, 2024 from $4.2 million for the three months ended March 31, 2023, primarily due to an increase in net compensation costs, partially offset by a decrease in public company-related expenses.

Current wording

General and administrative– General and administrative expenses increased by $0.3 million to $3.9 million for the three months ended June 30, 2024 from $3.6 million for the three months ended June 30, 2023, primarily due to an increase in net compensation costs, partially offset by a decrease in public company-related expenses.

Previous wording

Depreciation and amortization – Depreciation and amortization expense increased by $0.5 million to $5.3 million for the three months ended March 31, 2024 from $4.8 million for three months ended March 31, 2023, primarily due to the volume of our acquisitions.

Current wording

Depreciation and amortization – Depreciation and amortization expense increased by $0.7 million to $5.5 million for the three months ended June 30, 2024 from $4.8 million for three months ended June 30, 2023, primarily due to the volume of our acquisitions.

Previous wording

Other income primarily includes insurance recoveries related to property damage claims. Other income decreased by $0.06 million to $0.05 million for the three months ended March 31, 2024 from $0.1 million for the three months ended March 31, 2023, primarily due to a decrease in property related insurance recoveries from claims.

Current wording

Other income primarily includes insurance recoveries related to property damage claims. Other income decreased by $0.1 million to $0.02 million for the three months ended June 30, 2024 from $0.1 million for the three months ended June 30, 2023, primarily due to a decrease in property related insurance recoveries from claims.

Previous wording

During the three months ended March 31, 2024, we incurred total interest expense, net of $2.8 million compared to $2.2 million for the three months ended March 31, 2023. The increase in interest expense was primarily due to additional borrowings under the Credit Facilities and increased interest rates.

Current wording

During the three months ended June 30, 2024, we incurred total interest expense, net of $3.1 million compared to $2.5 million for the three months ended June 30, 2023. The increase in interest expense was primarily due to additional borrowings under the Credit Facilities and increased interest rates.

Previous wording

We had $1.9 million of cash and $0.8 million of escrows and reserves as of March 31, 2024 compared to $2.1 million of cash and $0.7 million of escrows and reserves as of March 31, 2023.

Current wording

We had $1.7 million of cash and $0.9 million of escrows and reserves as of June 30, 2024 compared to $2.2 million of cash and $0.8 million of escrows and reserves as of June 30, 2023.

Previous wording

Cash flows from operating activities – Net cash provided by operating activities decreased by $1.3 million to $6.4 million for the three months ended March 31, 2024 compared to $7.7 million for the same period in 2023. The decrease was mainly attributable to the timing of receivables and payables.

Current wording

Cash flows from operating activities – Net cash provided by operating activities increased by $1.7 million to $16.3 million for the six months ended June 30, 2024 compared to $14.6 million for the same period in 2023. The increase is primarily due to the volume our acquisitions, all of which have generated additional rental income and related changes in working capital, as well as the timing of certain receivables and payables.

Previous wording

Cash flows used in investing activities – Net cash used in investing activities for the three months ended March 31, 2024 primarily consisted of $13.0 million of acquisitions and $0.9 million of escrow deposits for acquisition and construction, capital improvements and other investing activities. Net cash used in investing activities for the three months ended March 31, 2023 primarily consisted of $17.4 million of acquisitions and $0.6 million of escrow deposits for acquisition and construction, capital improvements and other investing activities.

Current wording

Cash flows used in investing activities – Net cash used in investing activities for the six months ended June 30, 2024 primarily consisted of $41.8 million of acquisitions and $1.9 million of escrow deposits for acquisitions , capital improvements and other investing activities. Net cash used in investing activities for the six months ended June 30, 2023 primarily consisted of $32.9 million of acquisitions and $1.2 million of escrow deposits for acquisitions, capital improvements and other investing activities.

Previous wording

Cash flows from financing activities – Net cash provided by financing activities decreased by $3.8 million to $7.3 million for the three months ended March 31, 2024 compared to $11.0 million for the three months ended March 31, 2023. The decrease was primarily related to increased paydown of the Revolving Credit Facility and an increase in dividends and distributions during the three months ended March 31, 2024, partially offset by an increase in net proceeds received from issuance of shares during the same period.

Current wording

Cash flows from financing activities – Net cash provided by financing activities increased by $6.7 million to $27.1 million for the six months ended June 30, 2024 compared to $20.4 million for the six months ended June 30, 2023. The increase was primarily related to an increase in net proceeds received from issuance of shares during the same period and increased borrowings under the Revolving Credit Facility; partially offset by an increase in the payment of dividends and distributions during the six months ended June 30, 2024.

Previous wording

We had approximately $1.9 million of cash and $0.8 million of escrows and reserves as of March 31, 2024.

Current wording

We had approximately $1.7 million of cash and $0.9 million of escrows and reserves as of June 30, 2024.

Previous wording

We have entered into the Credit Facilities, which include the $150.0 million Revolving Credit Facility. the 2021 Term Loan and the 2022 Term Loan(and, together with the 2021 Term Loan, the "Term Loans"), with Bank of Montreal, as administrative agent, and BMO Capital Markets Corp., M&T Bank, JPMorgan Chase Bank, N.A. and Truist Securities, Inc. as joint lead arrangers and joint book runners. Additional participants in the Credit Facilities include Stifel Bank & Trust and TriState Capital Bank. As of March 31, 2024, we had $216.0 million of aggregate principal amount outstanding under our

Current wording

We have entered into the Credit Facilities, which include the $150.0 million Revolving Credit Facility. the 2021 Term Loan and the 2022 Term Loan(and, together with the 2021 Term Loan, the "Term Loans"), with Bank of Montreal, as administrative agent, and BMO Capital Markets Corp., M&T Bank, JPMorgan Chase Bank, N.A. and Truist Securities, Inc. as joint lead arrangers and joint book runners. Additional participants in the Credit Facilities include Stifel Bank & Trust and TriState Capital Bank. As of June 30, 2024, we had $242.0 million of aggregate principal amount outstanding under our Credit Facilities, with $75.0 million drawn on the 2021 Term Loan, $125.0 million drawn on the 2022 Term Loan and $42.0 million drawn on the Revolving Credit Facility.

Previous wording

As of March 31, 2024, we had approximately $248.9 million of outstanding consolidated principal indebtedness. The following table sets forth information as of March 31, 2024 with respect to our outstanding indebtedness (in thousands):

Current wording

As of June 30, 2024, we had approximately $274.9 million of outstanding consolidated principal indebtedness. The following table sets forth information as of June 30, 2024 with respect to our outstanding indebtedness (in thousands):

Previous wording

(1)See above under "—Revolving Credit Facility and Term Loans" for details regarding the Credit Facilities. During the three months ended March 31, 2024, we incurred $0.07 million of unused facility fees related to the Revolving Credit Facility.

Current wording

(1)See above under "—Revolving Credit Facility and Term Loans" for details regarding the Credit Facilities. During the three and six months ended June 30, 2024, we incurred $0.06 million and $0.1 million of unused facility fees related to the Revolving Credit Facility, respectively.

Previous wording

To maintain our qualification as a REIT, we are required to pay dividends to stockholders at least equal to 90% of our REIT taxable income determined without regard to the deduction for dividends paid and excluding net capital gains. During the three months ended March 31, 2024, we paid cash dividends of $0.24 per share. Our Board of Directors approved, and on April 30, 2024, we declared afirst quarter 2024 common stock dividend of $0.24 per share, which will be paid on May 31, 2024 to stockholders of record as of May 8, 2024.

Current wording

To maintain our qualification as a REIT, we are required to pay dividends to stockholders at least equal to 90% of our REIT taxable income determined without regard to the deduction for dividends paid and excluding net capital gains. During the three and six months ended June 30, 2024, we paid cash dividends of $0.24 and$0.48 per share, respectively. Our Board of Directors approved, and on July 23, 2024, we declared asecond quarter 2024 common stock dividend of $0.24 per share, which will be paid on August 30, 2024 to stockholders of record as of August 2, 2024.

Previous wording

As of May 7, 2024 and during the periods ubsequent to March 31, 2024, we have acquired six properties in individual or portfolio transactions for an aggregate of approximately $4.1 million, excluding closing costs.

Current wording

As of August 6, 2024 and during the periods ubsequent to June 30, 2024, we have acquired nine properties in individual or portfolio transactions for an aggregate of approximately $3.4 million, excluding closing costs.