GNL - NYSE

Ladies and gentlemen, greetings and welcome to Global Net Lease Inc. First Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jordyn Schoenfeld, Senior Vice President of Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and thank you for joining us for GNL's first quarter 2025 earnings call. Joining me today on the call is Michael Weil, GNL's Chief Executive Officer, and Chris Masterson, GNL's Chief Financial Officer. The following information contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Please review the forward-looking and cautionary statement section at the end of our first quarter 2025 earnings release for various factors that could cause actual results to differ materially from forward-looking statements made during our call today. As stated in our SEC filing, GNL disclaims any intent or obligation to update or revise these forward-looking statements except as required by law. Also, during today's call, we will discuss certain non-GAAP financial measures which we believe can be useful in evaluating a company's financial performance. Descriptions of those non-GAAP financial measures that we use, such as AFFO and adjusted EBITDA, and reconciliations of these measures to our results as reported in accordance with GAAP are detailed in our earnings release and supplemental materials. I'll now turn the call over to our Chief Executive Officer, Michael Weil. Mike?

Thanks, Jordyn. Good morning and thank you all for joining us today. Since completing our merger and internalization in September of 2023, we've made significant strides to elevate GNL across multiple industry benchmarks. On the governance front, we've strengthened oversight by broadening and diversifying our board, enhancing transparency, and putting in place practices that reflect our overall commitment to corporate governance. Operationally and financially, we launched an ambitious and disciplined initiative to materially reduce leverage, driven by our belief that a stronger balance sheet is essential to lowering our cost of capital, positioning the company for sustained growth, and ensuring we have the agility to navigate periods of heightened uncertainty and market volatility. We believe these actions reflected clear strategic vision and a deep commitment to building a more resilient and well-positioned company. We've been closely monitoring the tariffs that have introduced heightened uncertainty and volatility into the market. Our strategy has always revolved around building a net lease portfolio anchored by high credit quality tenants that are generally more resilient in uncertain economic environments, and we've been successful in this regard with 60% of our portfolio comprised of investment-grade tenants. We believe our leases, with a weighted average lease term of 6.3 years and 1.5% average annual rent increases, tend to be less impacted by macro economic events relative to other asset classes. We also have a disciplined hedging strategy that addresses both interest rate and foreign currency volatility in order to mitigate risk and maintain consistent cash flows. Turning to the first quarter of 2025, we achieved a key milestone in GNL's strategic transformation with the signing of a definitive agreement for the sale of our multi-tenant portfolio to RCG Ventures, the first phase of which has now been completed. This phase included 59 unencumbered properties generating $1.1 billion in gross proceeds and was completed on schedule, reinforcing our ability to deliver on stated objectives within our long-term strategy. Net proceeds were used to materially reduce leverage through a paydown of $850 million on GNL's revolving credit facility, further strengthening our balance sheet and enhancing financial flexibility for future initiatives. We remain on schedule to complete the sale of the 41 encumbered properties by the end of the second quarter of 2025, which is expected to generate another $700 million of gross proceeds. We believe one of the major benefits of this transaction is that it moves us closer to our goal of securing an investment grade credit rating, a central objective of our strategy to reduce our cost of capital and increase financial stability. We're encouraged by the growing recognition of our progress from the rating agencies with both Fitch and S&P placing GNL on credit watch positive. These upgrades reflect the tangible steps we've taken to reduce leverage, enhance liquidity and improve overall credit quality. We view this as another critical step in reinforcing financial strength and advancing GNL's strategic objectives. We're also making continued progress on a robust pipeline of non-core dispositions beyond the multi-tenant portfolio sale, which will also contribute to our deleveraging and further reduce net debt to adjusted EBITDA. As of May 1st, we have a closed plus disposition pipeline totaling $2.1 billion. Combined with the full multi-tenant portfolio sale and our 2024 dispositions of non-core and vacant properties, we expect total asset sales to reach nearly $3 billion by the end of 2025. Assuming the successful completion of all pipeline dispositions on the expected terms, of which there can be no assurance, the streamlined portfolio would simplify and strengthen GNL with notable improvements in key metrics such as investment tenancy, weighted average remaining lease term and occupancy. Following these sales, GNL would own a high-quality portfolio of net lease properties valued at approximately $5.5 billion, providing meaningful scale and operating efficiency with a sharp and pure play focus before the end of the second quarter of 2025. At the same time, we continue to take other deliberate steps to further strengthen our capital structure and mitigate risk. We've reduced our 2025 debt maturity balance from approximately $715 million at original issuance to $459 million as of the end of the first quarter 2025. We intend to pay off the maturing debt in the second quarter of 2025 and warehouse the balance on our revolving credit facility, which now offers significantly greater availability and flexibility following the substantial paydown we recently completed. We believe these actions position GNL to effectively navigate upcoming maturities from a position of strength while maintaining ample liquidity for strategic initiatives. Along with our multi-tenant portfolio sale, we announced that the board approved a $300 million share repurchase program, allowing the company to accretively buyback its outstanding common stock. Through May 2nd, 2025, we've repurchased 7.9 million shares at a weighted average price of $7.50, totaling $59 million of share repurchases. Repurchasing shares at a significant discount to NAV reflects our strategic approach to capitalize on the opportunity presented by our undervalued stock price in an accretive way. We intend to continue share repurchases, taking advantage of the compelling opportunity to buyback shares at an AFFO yield of approximately 12%. At the same time, we're continuing our disciplined approach to non-core asset sales and overall leverage reduction as we further strengthen our balance sheet. Turning to our portfolio, at the end of the first quarter, we owned over 1,000 properties spanning over 51 million rentable square feet. The portfolio's occupancy currently stands at 95%, with a weighted average remaining lease term of 6.3 years. Occupancy was temporarily impacted by the vacancy of Contractor’s Steel, a privately owned and operated full-service steel supplier that occupied nearly 1.4 million square feet. Despite the sizable footprint, this tenant represented just 1% of total straight-line rent. Contractor’s Steel encountered financial difficulties and vacated in the first quarter of 2025. Following their departure and subsequent to Q1 2025, we sold all five vacant properties for a combined $60 million. Having proactively marketed the assets early upon learning of their financial distress, which helped minimize vacancy downtime. Including the sale of these properties, our pro forma first quarter of 2025 occupancy would be 98%. We view this as a favorable outcome as it immediately reduced vacancy with minimal impact on the broader portfolio. Geographically, 76% of our straight-line rent is earned in North America and 24% in Europe. Unlike many net lease peers, our exposure to Europe differentiates us by providing diversification across economic cycles and the ability to capitalize on unique market opportunities not typically available in the U.S. The portfolio features a stable tenant base and a high quality of earnings with an industry-leading 60% of tenants receiving an investment grade or implied investment grade rating. The portfolio features an average annual contractual rental increase of 1.5% which excludes the impact of 18.7% of the portfolio with CPI linked leases that have historically experienced significantly higher rental increases. On the leasing front, we achieved positive leasing spreads encompassing over 826,000 square feet with attractive renewal spreads that were 8.2% higher than expiring rents. New leases that were completed in the first quarter of 2025 have a weighted average lease term of five years while renewals that were completed during this period have a weighted average lease term of 6.6 years. We have some additional updates regarding our portfolio. In April, we received written notice from the General Services Administration revoking its previous intent to exercise termination rights related to its lease at our Class A office building in Franklin, Tennessee. As a result, the existing lease agreement with the GSA remains in full force and effect and we look forward to continuing our strong relationship with GSA for many years to come. In addition, we've taken proactive steps to reduce our exposure to the gas and convenience store sector, an industry undergoing structural shifts in consumer behavior, fuel demand, and evolving transportation trends. As part of this effort, we started to strategically scale back our concentration to certain tenants within the segment. This decision reflects our disciplined approach to portfolio management and our ongoing focus on reallocating capital toward higher growth sectors that better align with our long-term strategic vision. Our continued ability to limit exposure to high-risk geography, asset types, tenants, and industries is a testament to our portfolio's impressive diversification and credit underwriting. No single tenant accounts for more than 4.3% of total straight-line rent, and our top 10 tenants collectively contribute only 26% of total straight-line rent. We carefully monitor all tenants in our portfolio and their business operations on a regular basis. I encourage everyone to look at the details of each segment of our portfolio, which can be found in our Q1 2025 investor presentation on our website. We're encouraged by the meaningful progress made on the sale of our multi-tenant portfolio, which is a pivotal step in GNL's strategic transformation. We believe this transaction unlocks key levers to support long-term growth while allowing us to sharpen our focus as a pure-play net lease REIT. We also believe the considerable uncertainty in the current market environment makes this a particularly opportune moment to bolster our liquidity position. With incremental cash on hand and enhanced capacity on our evolving credit facility, we'll remain disciplined and deliberate as we navigate the current market. I'll turn the call over to Chris to walk through the financial results and balance sheet matters in more detail. Chris?

Thanks, Mike. Please note that, as always, a reconciliation of GAAP net income to non-GAAP measures can be found in our earnings release, which is posted on our website. We also want to emphasize that first quarter 2025 earnings and leverage metrics reflect the full benefit of NOI from the unencumbered assets sold as part of the multi-tenant portfolio sale, consistent with what we anticipated when establishing full year guidance. For the first quarter of 2025, we recorded revenue of $132.4 million and a net loss attributable to common stockholders of $200.3 million, which we anticipate will significantly improve upon closing the remainder of the multi-tenant portfolio sale. AFFO was $66.2 million, or $0.29 per share. Looking at our balance sheet, the growth outstanding debt balance was $3.9 billion at the end of the first quarter of 2025, down by $1.6 [indiscernible] from the end of the first quarter of 2024. Our debt is comprised of $1 billion in senior notes, $547 million on the multi-currency revolving credit facility, and $2.3 billion of outstanding gross mortgage debt. As of the end of the first quarter of 2025, 91% of our debt is fixed, reflecting debt tied to fixed rates or debt that is swapped to fixed rates. Our weighted average interest rate stood at 4.4%, and our interest coverage ratio was 2.5 times. At the end of the first quarter of 2025, our net debt to adjusted EBITDA ratio was 6.7 times, based on net debt of $3.7 billion. As a reminder, our net debt to adjusted EBITDA was 8.4 times at the end of the first quarter of 2024. As of March 31, 2025, we have liquidity of approximately $499 million, and $1.4 billion of capacity on our revolving credit facility. Additionally, we had approximately 229 million shares of common stock outstanding, and approximately 230 million shares outstanding on a weighted average basis for the first quarter of 2025. As of May 2, 2025, we repurchased 7.9 million shares at a weighted average price of $7.50 per share under our share repurchase program, resulting in approximately 223 million shares outstanding. As Mike mentioned, given the potential for additional turbulence in the market, we've continued to take proactive steps to strengthen GNL's balance sheet and overall financial position, which we believe is the most prudent action we can take. In addition, we continue to implement our hedging strategy using FX forwards to lock in foreign exchange rates for three to four years out. This approach is designed to mitigate risk and reduce cash flow uncertainty during periods of market volatility. We remain focused on enhancing liquidity and maintaining financial flexibility, leaving us well-positioned to navigate any market conditions. Turning to our outlook for the remainder of 2025, based on progress to date, we are reaffirming our AFFO per share guidance range of $0.90 to $0.96, and our net debt to adjust the EBITDA range of 6.5 times to 7.1 times. I'll now turn the call back to Mike for some closing remarks.

Thanks, Chris. Looking ahead, we're encouraged by the meaningful progress we've made in executing on our strategic priorities. The first quarter of 2025 was a significant turning point as we took deliberate steps to simplify our portfolio, strengthen our balance sheet, and enhance financial flexibility. We have a clear focus on creating long-term value reflected by the successful execution of the first phase of the multi-tenant portfolio sale, combined with our additional disposition pipeline and proactive debt reduction efforts. We remain on track to close the other two tranches of the multi-tenant portfolio sale in the second quarter of 2025, marking another important milestone in our transformation. With a simplified asset base, reduced leverage, and increased liquidity, we believe GNL is better positioned to operate efficiently and pursue opportunities that align with our strategic vision. We believe the actions we've taken have significantly improved our ability to navigate today's market environment while setting the stage for durable growth. Disciplined execution and the strategic deployment of capital towards initiatives that enhance long-term value remain at the core of our approach. These are foundational decisions designed not just to improve short-term metrics but to drive long-term resilience and performance. We're excited about the future and confident in our path forward. We're available to answer any questions you may have after the call. Operator, please open the line for questions.

Thank you. Ladies and gentlemen, we will now begin the question and answer session. [Operator Instructions] The first question comes from the line of John Kim from BMO Capital Markets. Please go ahead.

Good morning, John.

Good morning. On the disposition pipeline of $2.1 billion, can you break down the remaining $300 million that's not part of the multi-tenant portfolio sale by either sector or geography?

In our filed materials and pipeline report, we have done that. A lot of that is disposition pipeline that has been underway since the end of ‘24 into ‘25. It's more of what you saw in 2024 of what we have identified in the portfolio as non-core. And it's just a continuing part of how we're looking at the further deleveraging.

And Michael, you alluded to the volatility in the financial markets since the tariffs were introduced. How much do you think that will impact your ability to sell or pricing that you're looking to achieve?

I think we're going to continue to see opportunity to sell the assets in market typically to either local private buyer or 1031 buyer for the most part. We've also seen opportunities and have taken advantage of certain markets where repositioning of an asset through a developer sale has continued to be strong. We're not seeing a big change from what we experienced in 2024 as it relates to the disposition strategy. Again, it's I think really enhanced by the relationships that we have with the brokers in community. We've never set out to just have one large national brokerage firm handle all dispositions. And the relationship with brokers, I'm always grateful for how well they know their markets, how hard they work. And their interests are aligned with ours. We want to sell the property. They want to earn a commission. So they do great work for us.

On the share with purchases, you mentioned you achieved a 12% AFFO yield. Is that the hurdle rate that you're looking for on future buybacks?

We are certainly very pleased with where we've been executing on the buyback. It is very opportunistic for us to be at this level. It's kind of a blessing and a curse, John. There's nothing I'd like more than to be approaching double-digit stock price. But while this work that we're doing is taking hold, and we've talked about the improved liquidity, the lower leverage, the great leasing that we had in the quarter, the continued dispositions, it's very rewarding for us to see the opportunity to buyback shares to the long-term benefit, the accretion. There's no real estate that a company could buy right now that's equal to the value of what we're doing. Not only are we reducing the outstanding share count, as you know, but we're buying shares that we feel are materially undervalued and trading at too big of a discount to NAV. So I was very pleased when the board approved our buyback and we were able to announce it. And to buyback nearly $60 million of stock this quickly was probably faster than I had anticipated. But the opportunity being what it was, we jumped in. We'll continue to monitor the AFFO accretion, the hurdle, as you put it. We still think there's opportunity here, but again, I'd like nothing more than to see this be the combination of the results of the second quarter, what really gets this stock moving and closes that gap that we see to value. So it's a great way to add to what we're doing.

Great. Thank you.

Thanks, John.

Thank you. We take the next question from the line of Upal Rana from KeyBanc Capital Markets. Please go ahead.

Hi, Upal.

Great thanks. Hey, good morning out there. So just on the buyback, I was wondering if you'd share your strategy on the capital allocation and this pecking order where you see buying more shares or paying down more debt or potentially buying assets again in the future.

Well, we would love to have the market come to us in a way that makes buying assets accretive and interesting, but we're not there right now and we don't see the market being very interesting as well. What is coming to market, I don't really see as interesting or long-term valuable. We're very focused, as you know, on reduction of leverage and opportunistic buyback of shares. It is something that we talk about internally, look at with the board. And as we confirmed in our earlier comments, we are reaffirming guidance. And in our 2025 guidance, we gave our leverage metrics of 6.5 to 7.1 times. They're just the ongoing execution of the business model, which includes dispositions, it includes leasing. So leverage and buyback are not the only two levers that will have a direct impact on our overall net debt to EBITDA. So we're mindful, we're very mindful of leverage because we think the continued lowering of leverage is going to have a meaningful impact on our cost of capital. And it's going to open some doors for the company. We've talked about our one of our mid to, we'll call it a midterm goal, is achieving investment grade rating. We know that that's going to occur through the continued execution of our plan to lower leverage. So I'm actually really proud of the work we're doing because we're addressing a number of important things. It's a lot of focus. It's a lot of great execution between the asset management teams and the dispositions, the overall capital desk and how we're handling the stock buyback. A lot of great work, Chris and his team managing the credit facility, and just the increased liquidity that the company has at the end of the first quarter is really meaningful. So, a lot of really good things to focus on for GNL. And I think that we're starting to get some recognition for the direction that we're taking the company. And I always like to talk about sticking to your knitting. I feel like we're really sticking to our knitting and we're not getting distracted. And we're just doing the things that are going to create long-term value. You know, it's funny, in one quarter, it's almost like, the announcement of the sale of the multi-tenant portfolio was a huge announcement because of what it does long-term for GNL. Simplifying the story. We closed that big first tranche. We're on track to execute in the second quarter the remaining pieces of that transaction. So, the word transformative gets used too often, I feel, but I think the first half of 2025 has really been transformative for us. And we're looking forward to second quarter results and moving on from here.

Okay, great. That was helpful. And then just on the credit rating upgrade, maybe you can share some of the conversations you've had with some of the credit agencies and potential timing there. And maybe you can share, if you were to get an upgrade, what the potential savings could look like.

Yeah, I'm going to be a little close to the chest on that one because the conversations, of course, are confidential between the agencies and the company. But you saw from their announcement that we were credit watch positive, that they are following the company and they see the value in lowering leverage and what it does for us. I think from our longer-term view, eventually being able to access what I'll just call investment-grade debt opportunities, you know the value of that for the company. And right now, we've given 2025 guidance. We've got AFFO guidance of $0.90 to $0.96 per share. That takes into account how we're thinking of everything inclusive of debt costs in 2025. So, I think that that would probably be something that we're more looking at from a guidance standpoint for 2026.

Okay. All right. Thank you. And then just last one for me, just on the strategy of, the kinds of disposition you're targeting moving forward. With the multi-senate portfolio, obviously, it's a big announcement, but just, given that's mostly out of the way and you have mentioned in the past, the office portfolio will likely be sort of one-off. What else is there to do in your portfolio to recycle?

Well, we're looking at some of the retail opportunities in the portfolio from a disposition standpoint. We are, as you mentioned, there are opportunities for dispositions in the office as well. We're a large portfolio. After the multi-tenant disposition, we'll be just over 1,000 properties. So, we can really take a very granular review of the portfolio and kind of look at our long-term goals. And I spoke about that last quarter. Obviously, we see continued value in single-tenant industrial and retail for long-term growth. We've got good value and a lot of investment-grade tenants in our office portfolio, but it's not something that I'd like to see grow. So, we will opportunistically sell at value from that portfolio. But as I said earlier, we're pleased to see the level of buyers. We've been able to continue our velocity of dispositions and it'll help us achieve the goals that we've already stated.

Okay, great. Thank you.

Thanks.

Thank you. The next question comes from the line of Mitch Germain from Citizens JMP. Please go ahead.

Hi, Mitch.

Hey, good morning. Congrats on the quarter.

Thank you.

When looking at the -- I can just look at the amount. Obviously, I don't have a lot of the details of your disposition pipeline, but if I look at that amount, what was either agreed under contract or closed from last quarter to this quarter, it's been fairly static. Again, some of the assets might have gone in and out. I'm curious, though, like you've got a pretty big amount of sales planned for this, it looks like this upcoming quarter. What's next? I mean, will you continue to remain aggressive from an asset sale perspective as long as there is something to do with those proceeds?

So, Mitch, you always ask good questions that have a -- it's a tough direct answer to give because there's a balance in how we look at dispositions. Obviously, we want to see dispositions and use of proceeds related to leverage, which we've done and will continue to do. But at the same time, it's very important to us to monitor and understand our NOI and earnings side of the business as well. So, it's not just an absolute open the door, sell it all down, because we think what we're doing is intentional and will create the type of value that we're looking for. We think that it will be what closes the gap, the trading gap to share price to NAV. We also have the benefit, as you know, of the buyback in doing that. So, we're regularly evaluating where we are, regularly evaluating leverage, and also what the market opportunity is for disposition. I -- between calendar year ‘24 and calendar year ‘25, we'll have sold a pretty material amount of assets at a meaningful price. So, I believe what we projected for 2025 in our guidance, A, will achieve and B, will move us to achieve the goals that we've stated.

Okay. 3 billion, by the way, is what you're selling, which is pretty impressive.

Yeah. Yeah.

How should I think about some of your commentary regarding C-stores? I mean, are some of those properties in your disposition slide in your presentation, or is that something that could be considered going forward as potential sale candidates, as you mentioned retail, in addition to office?

Well, it was one of our larger sectors in the portfolio. So, yes, we did think, as we've looked at different things, the macro view on fuel prices are, well, the refiners are under some pressure. The convenience store with labor rates going up are under pressure. So, we try to take a longer, earlier view of what is changing or sometimes it's changing for good, sometimes it gives us concern. So, we have been lightening our exposure to gas and convenience, and that, I expect you'll see, will continue.

Got you. Last for me, I guess you had that, you talked about a situation with a tenant, Contractor’s Steel, sorry.

Yes.

I hate asking about watchlists, but, you talked about C-store and trying to get ahead of potential headwinds there. Rather than say what's happening with your watchlist, is there anything that you're looking in your sector that might be a candidate for sale, just because looking out how the trends or your view on a sector trends are materializing may create an opportunity to get ahead of headwinds? Is that kind of anything that comes to mind, other than C-stores?

Yeah, I'm going to be a little bit coy because sometimes as we're looking to dispose of things, that's not the type of commentary we'd like out in the market. But yes, it is absolutely part of the strategic review that Ori and his team do on a regular basis. Sometimes it's easier to talk about it after the sale, and I can explain our logic of how we're looking at a certain sector, et cetera. But first of all, the real estate is really good real estate. It's well located. Whether it's going to continue its existing tenant and operation, or whether because it's located at a main and main location somewhere in a market in America where people live and work, there's a lot that can be done with these types of properties. It's always what we've liked about single tenant net lease. So, I think the important thing to really focus on is the watchlist is important, but the asset management review that we're constantly doing, we know the opportunities. Sometimes it's because a developer reaches out to us and all of a sudden is very interested in a property. We're able to get out to that market, see what's going on, figure out what the highest and best use is. Sometimes a great offer isn't great enough, and other times you kind of start to see that, okay, things are long term, a little bit different than when we bought the property five or six years ago. So, we want to get ahead of it. But it all goes hand in hand, great real estate, understanding the financials, understanding the sector, and then making decisions, hopefully, while there's still great value in the property.

Thank you.

Thanks, Mitch.

Thank you. [Operator Instructions] The next question comes from the line of Michael Gorman from BTG Vaxchel. Please go ahead.

Hi, Michael.

Hi, good morning. Just a quick one, sorry if I missed it, but do contractors pay any rent in the first quarter?

They do not.

I'm looking at Ori. Sorry, Michael.

They do not.

Thanks, Chris.

They do not. Okay, good. That's helpful. Thank you. And then just, obviously, appreciate the affirmed guidance. I wonder if you could just help us think through, given the number of moving parts, right. You had the solid first quarter. It implies kind of 21 -- the midpoint of the guidance implies kind of like $0.21 a share pro rata over the balance of the year. But given the timing of the sale in the second quarter, I doubt it's going to be pro forma. So can you help us maybe think through in a little bit more detail kind of what the run rate looks like or maybe just what the back half of the year looks like once the second and third tranches of the multi-tenant deal are closed from an AFFO perspective?

I guess, Mike, I can just quickly jump in because I think I could probably help

Yeah go ahead.

Point something out here. Michael, so if you take a look at the income statement, the way that it's broken out, we have to disclose discontinued operations, which is effectively the entire multi-tenant portfolio and everything that will be sold. So the income statement itself already strips out the multi-tenant. And then in terms of a go forward, I just do want to bring up again, we disclosed it last quarter that the G&A is expected on an annualized basis to decrease by about $6.4 million a year due to this multi-tenant sale.

Got it. That's helpful. And then maybe just last one from a transaction perspective. Obviously, I think it makes a lot of sense strategically and from the capital structure to sell down the vacant assets and use that to reduce the debt load and repurchase shares. I'm just curious, between last year and then what's in the pipeline for this year, it's about 140 vacant assets. I'm just curious, Michael, is that basically the preponderance of the vacant assets that are in the portfolio? Is there still a sleeve there that would be potentially a source of future proceeds or how should we think about that?

Michael, I'm sorry. I was trying to look through some information as you were asking the question. Will you ask me that one more time?

Yeah, sure. Of course. So between last year and kind of what's in the pipeline, it's about 140 vacant assets that are either closed or set to be closed. Is that the bulk of the vacant assets in the portfolio or are there more potential vacant sales available to you to be able to pay down additional debt?

Got it. Thank you. Well, no, because as you saw from our release, we're going to be about 98% occupied in the second quarter after the completion of the multi-tenant sale. We see that going up a little bit from there, just from leasing, et cetera. So no, there's not a lot of vacancy left in this portfolio. You're really going to get used to seeing us reporting in what's typical for a single-tenant net lease rate.

Great. Thanks for the time.

All right. Thank you, Michael.

Thank you. Ladies and gentlemen, as there are no further questions, I will now hand the conference over to Mike Weil for his closing remarks. Mike?

Great. Well, thank you, everybody. We always appreciate you taking the time to catch up with us and to see the progress that GNL is making. As I said a little bit earlier, really proud of this work that we're doing. We're all very focused and starting to see the benefits of these conclusions. So thanks again. If you have any questions, we look forward to following up. We'll talk to everybody soon, and I guess we'll see most of you at NAREIT in a couple of weeks. So talk to everybody then. Thank you.