UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q


☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________.

Commission file number: 001-37815

Global Medical REIT Inc.

(Exact name of registrant as specified in its charter)


Maryland		46-4757266
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

7373 Wisconsin Avenue, Suite 800 Bethesda, MD		20814
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (202) 524-6851

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class:	Trading Symbol(s):	Name of each exchange on which registered:
Common Stock, par value $0.001 per share	GMRE	NYSE
Series A Preferred Stock, par value $0.001 per share	GMRE PrA	NYSE

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. þ Yes ◻ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	þ	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

The number of shares of the registrant’s common stock outstanding at August 5, 2024 was 65,587,648

Table of Contents

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION



Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Balance Sheets – June 30, 2024 and December 31, 2023	3
	Condensed Consolidated Statements of Operations – Three and Six Months Ended June 30, 2024 and 2023	4
	Condensed Consolidated Statements of Comprehensive (Loss) Income – Three and Six Months Ended June 30, 2024 and 2023	5
	Condensed Consolidated Statements of Equity – Three and Six Months Ended June 30, 2024 and 2023	6
	Condensed Consolidated Statements of Cash Flows – Six Months Ended June 30, 2024 and 2023	8
	Notes to the Unaudited Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	39

Item 4.	Controls and Procedures	39

PART II OTHER INFORMATION

Item 1.	Legal Proceedings	40

Item 1A.	Risk Factors	40

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	40

Item 3.	Defaults Upon Senior Securities	40

Item 4.	Mine Safety Disclosures	40

Item 5.	Other Information	40

Item 6.	Exhibits	41

Signatures		42

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GLOBAL MEDICAL REIT INC.

Condensed Consolidated Balance Sheets

(unaudited and in thousands, except par values)


	As of
	June 30, 2024		December 31, 2023
Assets
Investment in real estate:
Land	$	162,391	$	164,315
Building		1,028,539		1,035,705
Site improvements		21,960		21,974
Tenant improvements		66,004		66,358
Acquired lease intangible assets		136,394		138,617
		1,415,288		1,426,969
Less: accumulated depreciation and amortization		(271,764)		(247,503)
Investment in real estate, net		1,143,524		1,179,466
Cash and cash equivalents		4,978		1,278
Restricted cash		2,840		5,446
Tenant receivables, net		8,073		6,762
Due from related parties		410		193
Escrow deposits		925		673
Deferred assets		28,360		27,132
Derivative asset		27,672		25,125
Goodwill		5,903		5,903
Other assets		18,530		15,722
Total assets	$	1,241,215	$	1,267,700

Liabilities and Equity
Liabilities:
Credit Facility, net of unamortized debt issuance costs of $5,968 and $7,067 at June 30, 2024 and December 31, 2023, respectively	$	599,032	$	585,333
Notes payable, net of unamortized debt issuance costs of $40 and $66 at June 30, 2024 and December 31, 2023, respectively		14,638		25,899
Accounts payable and accrued expenses		11,962		12,781
Dividends payable		16,280		16,134
Security deposits		3,973		3,688
Other liabilities		12,809		12,770
Acquired lease intangible liability, net		4,149		5,281
Total liabilities		662,843		661,886
Commitments and Contingencies
Equity:
Preferred stock, $0.001 par value, 10,000 shares authorized; 3,105 issued and outstanding at June 30, 2024 and December 31, 2023, respectively (liquidation preference of $77,625 at June 30, 2024 and December 31, 2023, respectively)		74,959		74,959
Common stock, $0.001 par value, 500,000 shares authorized; 65,588 shares and 65,565 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively		66		66
Additional paid-in capital		722,627		722,418
Accumulated deficit		(268,885)		(238,984)
Accumulated other comprehensive income		27,672		25,125
Total Global Medical REIT Inc. stockholders' equity		556,439		583,584
Noncontrolling interest		21,933		22,230
Total equity		578,372		605,814
Total liabilities and equity	$	1,241,215	$	1,267,700

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GLOBAL MEDICAL REIT INC.

Condensed Consolidated Statements of Operations

(unaudited and in thousands, except per share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023

Revenue
Rental revenue	$	34,214	$	36,317	$	69,283	$	72,517
Other income		27		34		77		64
Total revenue		34,241		36,351		69,360		72,581

Expenses
General and administrative		4,589		4,462		9,035		8,266
Operating expenses		7,236		7,223		14,619		14,759
Depreciation expense		10,127		10,468		20,240		20,962
Amortization expense		3,866		4,337		7,838		8,732
Interest expense		6,992		8,468		13,883		16,739
Preacquisition expense		—		2		—		44
Total expenses		32,810		34,960		65,615		69,502

Income before (loss) gain on sale of investment properties		1,431		1,391		3,745		3,079
(Loss) gain on sale of investment properties		(3,383)		12,786		(3,383)		13,271

Net (loss) income	$	(1,952)	$	14,177	$	362	$	16,350
Less: Preferred stock dividends		(1,455)		(1,455)		(2,911)		(2,911)
Less: Net loss (income) attributable to noncontrolling interest		260		(902)		195		(947)
Net (loss) income attributable to common stockholders	$	(3,147)	$	11,820	$	(2,354)	$	12,492

Net (loss) income attributable to common stockholders per share – basic and diluted	$	(0.05)	$	0.18	$	(0.04)	$	0.19

Weighted average shares outstanding – basic and diluted		65,588		65,544		65,580		65,534

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GLOBAL MEDICAL REIT INC.

Condensed Consolidated Statements of Comprehensive (Loss) Income

(unaudited and in thousands)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023

Net (loss) income	$	(1,952)	$	14,177	$	362	$	16,350
Other comprehensive (loss) income :
(Decrease) increase in fair value of interest rate swap agreements		(1,613)		8,449		2,547		1,185
Total other comprehensive (loss) income		(1,613)		8,449		2,547		1,185
Comprehensive (loss) income		(3,565)		22,626		2,909		17,535
Less: Preferred stock dividends		(1,455)		(1,455)		(2,911)		(2,911)
Less: Comprehensive loss (income) attributable to noncontrolling interest		383		(1,501)		1		(1,027)
Comprehensive (loss) income attributable to common stockholders	$	(4,637)	$	19,670	$	(1)	$	13,597

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GLOBAL MEDICAL REIT INC.

Condensed Consolidated Statements of Equity

(unaudited and in thousands, except per share amounts)

For the Six Months Ended June 30, 2024:


													Global
											Accumulated		Medical
							Additional				Other		REIT Inc.		Non-
	Common Stock			Preferred Stock			Paid-in		Accumulated		Comprehensive		Stockholders’		controlling		Total
	Shares	Amount		Shares	Amount		Capital		Deficit		Income		Equity		Interest		Equity
Balances, December 31, 2023	65,565	$	66	3,105	$	74,959	$	722,418	$	(238,984)	$	25,125	$	583,584	$	22,230	$	605,814
Net income (loss)	—		—	—		—		—		557		—		557		(195)		362
LTIP Units redeemed for common stock	23		—	—		—		209		—		—		209		(209)		—
Change in fair value of interest rate swap agreements	—		—	—		—		—		—		2,547		2,547		—		2,547
Stock-based compensation expense	—		—	—		—		—		—		—		—		2,552		2,552
Dividends to common stockholders ($0.42 per share)	—		—	—		—		—		(27,547)		—		(27,547)		—		(27,547)
Dividends to preferred stockholders ($0.9375 per share)	—		—	—		—		—		(2,911)		—		(2,911)		—		(2,911)
Dividends to noncontrolling interest	—		—	—		—		—		—		—		—		(2,445)		(2,445)
Balances, June 30, 2024	65,588	$	66	3,105	$	74,959	$	722,627	$	(268,885)	$	27,672	$	556,439	$	21,933	$	578,372

For the Three Months Ended June 30, 2024:


													Global
											Accumulated		Medical
							Additional				Other		REIT Inc.		Non-
	Common Stock			Preferred Stock			Paid-in		Accumulated		Comprehensive		Stockholders’		controlling		Total
	Shares	Amount		Shares	Amount		Capital		Deficit		Income		Equity		Interest		Equity
Balances, March 31, 2024	65,587	$	66	3,105	$	74,959	$	722,623	$	(251,963)	$	29,285	$	574,970	$	22,128	$	597,098
Net loss	—		—	—		—		—		(1,692)		—		(1,692)		(260)		(1,952)
LTIP Units redeemed for common stock	1		—	—		—		4		—		—		4		(4)		—
Change in fair value of interest rate swap agreements	—		—	—		—		—		—		(1,613)		(1,613)		—		(1,613)
Stock-based compensation expense	—		—	—		—		—		—		—		—		1,319		1,319
Dividends to common stockholders ($0.21 per share)	—		—	—		—		—		(13,774)		—		(13,774)		—		(13,774)
Dividends to preferred stockholders ($0.46875 per share)	—		—	—		—		—		(1,456)		—		(1,456)		—		(1,456)
Dividends to noncontrolling interest	—		—	—		—		—		—		—		—		(1,250)		(1,250)
Balances, June 30, 2024	65,588	$	66	3,105	$	74,959	$	722,627	$	(268,885)	$	27,672	$	556,439	$	21,933	$	578,372

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GLOBAL MEDICAL REIT INC.

Condensed Consolidated Statements of Equity - Continued

(unaudited and in thousands, except per share amounts)

For the Six Months Ended June 30, 2023:


													Global
											Accumulated		Medical
							Additional				Other		REIT Inc.		Non-
	Common Stock			Preferred Stock			Paid-in		Accumulated		Comprehensive		Stockholders’		controlling		Total
	Shares	Amount		Shares	Amount		Capital		Deficit		Income		Equity		Interest		Equity
Balances, December 31, 2022	65,518	$	66	3,105	$	74,959	$	721,991	$	(198,706)	$	34,674	$	632,984	$	16,081	$	649,065
Net income	—		—	—		—		—		15,403		—		15,403		947		16,350
LTIP Units redeemed for common stock	47		—	—		—		427		—		—		427		(427)		—
OP Units issued for a property acquisition	—		—	—		—		—		—		—		—		5,482		5,482
Change in fair value of interest rate swap agreements	—		—	—		—		—		—		1,185		1,185		—		1,185
Stock-based compensation expense	—		—	—		—		—		—		—		—		1,835		1,835
Dividends to common stockholders ($0.42 per share)	—		—	—		—		—		(27,530)		—		(27,530)		—		(27,530)
Dividends to preferred stockholders ($0.9375 per share)	—		—	—		—		—		(2,911)		—		(2,911)		—		(2,911)
Dividends to noncontrolling interest	—		—	—		—		—		—		—		—		(2,084)		(2,084)
Balances, June 30, 2023	65,565	$	66	3,105	$	74,959	$	722,418	$	(213,744)	$	35,859	$	619,558	$	21,834	$	641,392

For the Three Months Ended June 30, 2023:


													Global
											Accumulated		Medical
							Additional				Other		REIT Inc.		Non-
	Common Stock			Preferred Stock			Paid-in		Accumulated		Comprehensive		Stockholders’		controlling		Total
	Shares	Amount		Shares	Amount		Capital		Deficit		Income		Equity		Interest		Equity
Balances, March 31, 2023	65,530	$	66	3,105	$	74,959	$	722,113	$	(211,794)	$	27,410	$	612,754	$	15,721	$	628,475
Net income	—		—	—		—		—		13,275		—		13,275		902		14,177
LTIP Units redeemed for common stock	35		—	—		—		305		—		—		305		(305)		—
OP Units issued for a property acquisition	—		—	—		—		—		—		—		—		5,482		5,482
Change in fair value of interest rate swap agreements	—		—	—		—		—		—		8,449		8,449		—		8,449
Stock-based compensation expense	—		—	—		—		—		—		—		—		1,147		1,147
Dividends to common stockholders ($0.21 per share)	—		—	—		—		—		(13,769)		—		(13,769)		—		(13,769)
Dividends to preferred stockholders ($0.46875 per share)	—		—	—		—		—		(1,456)		—		(1,456)		—		(1,456)
Dividends to noncontrolling interest	—		—	—		—		—		—		—		—		(1,113)		(1,113)
Balances, June 30, 2023	65,565	$	66	3,105	$	74,959	$	722,418	$	(213,744)	$	35,859	$	619,558	$	21,834	$	641,392

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GLOBAL MEDICAL REIT INC.

Condensed Consolidated Statements of Cash Flows

(unaudited and in thousands)


	Six Months Ended June 30,
	2024		2023
Operating activities
Net income	$	362	$	16,350
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation expense		20,240		20,962
Amortization of acquired lease intangible assets		7,629		8,679
Amortization of above market leases, net		500		578
Amortization of debt issuance costs and other		1,125		1,202
Stock-based compensation expense		2,552		1,835
Capitalized preacquisition and other costs charged to expense		82		76
Reserve for uncollectible accounts, net		822		—
Loss (gain) on sale of investment properties