Net Lease Office PropertiesNLOP
Net Lease Office Properties Debt Disclosure
Debt
Debt Facility
On September 20, 2023, in connection with the Spin-Off (Note 1), 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 with an original maturity on November 9, 2025, with two separate one-year extension options subject to certain conditions (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”). Upon closing of the Spin-Off on November 1, 2023 (Note 1), the NLOP Financing Arrangements were drawn in full, and approximately $343.9 million of the proceeds from the financing (net of transaction expenses) was transferred to WPC in connection with the Spin-Off.
During the year ended December 31, 2025, we fully repaid the NLOP Mezzanine Loan, which had $61.1 million of outstanding principal as of December 31, 2024, using net proceeds from certain dispositions, as well as excess cash flow from operations and other sources, including the application of loan reserves. During the year ended December 31, 2024, we fully repaid the NLOP Mortgage Loan, which had $288.9 million of outstanding principal as of December 31, 2023, using proceeds from certain dispositions, as well as cash flow from rent on our properties and other sources.
Non-Recourse Mortgages
Non-recourse mortgages consist of mortgage notes payable, which are collateralized by the assignment of real estate properties. At December 31, 2025, our only non-recourse mortgage note payable encumbered one property, with a fixed interest rate of 7.0%, and a maturity date of July 2026. This mortgage encumbered a property classified as net investments in sales-type lease as of December 31, 2025 (Note 6).
Parent Debt
Prior to the Spin-Off, certain wholly-owned affiliates of WPC entered into debt agreements with the international NLOP entities to provide the funding necessary to acquire certain international assets. In connection with the Spin-Off, WPC assigned to us the receivable related to these debt amounts (“Parent Debt”), which eliminates in consolidation.
Repayments During 2025
During the year ended December 31, 2025, we repaid four non-recourse mortgage loans totaling $49.8 million. We recognized a net loss on extinguishment of debt of $0.1 million on these repayments, which is included within Other gains and (losses) on our consolidated statements of operations. The weighted-average interest rate for these non-recourse mortgage loans was 7.5%.
Repayments During 2024
During the year ended December 31, 2024, we prepaid two non-recourse mortgage loans totaling $20.8 million. We recognized a net loss on extinguishment of debt of $0.3 million on these repayments, which is included within Other gains and (losses) on our consolidated statements of operations. The weighted-average interest rate for these non-recourse mortgage loans was 5.2%. As a result of one of the repayments, WPC no longer serves as guarantor for any of our non-recourse mortgage loans.
Repayments During 2023
During the year ended December 31, 2023, we (i) repaid a non-recourse mortgage loan at maturity with an aggregate principal balance of approximately $0.3 million, and (ii) prepaid a non-recourse mortgage loan of $2.9 million. We recognized an aggregate net gain on extinguishment of debt of less than $0.1 million on these repayments, which is included within Other gains and (losses) on our consolidated statements of operations. The weighted-average interest rate for these non-recourse mortgage loans on their respective dates of repayment was 5.2%.
Interest Paid
For the years ended December 31, 2025, 2024, and 2023, interest paid was $9.2 million, $41.3 million, and $39.3 million, respectively.
Scheduled Debt Principal Payments
Scheduled debt principal payments as of December 31, 2025 are as follows (in thousands):
| Years Ending December 31, | Total | |||||||
| 2026 | $ | 21,900 | ||||||
| 2027 | — | |||||||
| 2028 | — | |||||||
| 2029 | — | |||||||
| 2030 | — | |||||||
| Total | $ | 21,900 | ||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 25, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
| 2023 | Mar 6, 2024 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.