As of March 31, 2026, the Company's properties were leased primarily to the USPS, with leases expiring at various dates through December 31, 2038. Certain leases had expired and were in holdover status as of March 31, 2026 as discussed below. Certain leases contain renewal, termination and/or purchase options exercisable at the lessee’s election. Therefore, such options are only recognized once they are deemed reasonably certain, typically at the time the option is exercised. All of the Company’s leases are operating leases with the exception of two that are direct financing leases. The Company's operating leases and direct financing leases are described below.

Rental income related to the Company’s leases is recognized on a straight-line basis over the remaining lease term. The Company’s total revenue includes fixed base rental payments provided under the lease and variable payments which principally consist of tenant expense reimbursements for certain property operating expenses, including real estate taxes. The Company elected the practical expedient to account for its lease and non-lease components as a single combined operating lease component under Topic 842. As a result, rental income and tenant reimbursements were aggregated into a single line within rental income in the Consolidated Statements of Operations and Comprehensive Income (Loss).

Future minimum lease payments to be received as of March 31, 2026 (excluding base rental payments from properties classified as held for sale under non-cancellable operating leases for the next five years and thereafter are as follows (in thousands):


Year Ending December 31,	Amount (1)(2)
2026 - Remaining	$	64,901
2027	77,031
2028	65,821
2029	57,074
2030	49,019
Thereafter	179,408
Total	$	493,254

(1)The above minimum lease payments to be received do not include reimbursements from tenants for real estate taxes and other reimbursed expenses.

(2)As of March 31, 2026, the leases at eight of the Company's properties was expired and the USPS was occupying such property as a holdover tenant. As such, the above minimum lease payments to be received do not include payments under these holdover leases. Holdover rent is typically paid as the greater of estimated market rent or the rent amount due under the expired lease.

As of March 31, 2026, operating leases for 94 of the Company’s properties provided the USPS with the option to purchase the underlying property either at fair market value or at fixed prices(1), in each case as of dates set forth in the lease. As of March 31, 2026, 88 of these properties had an aggregate carrying value of approximately $67.9 million with an aggregate purchase option price of approximately $91.0 million and the remaining six properties had an aggregate carrying value of approximately $7.3 million with purchase options exercisable at fair market value.

As of March 31, 2026 and December 31, 2025, financing leases for two of the Company's properties provide the USPS with the option to purchase the underlying property at fixed prices as of dates set forth in the lease agreement. The components of the Company’s net investment in financing leases as of March 31, 2026 and December 31, 2025 are summarized in the table below (in thousands):


	As of March 31, 2026		As of December 31, 2025

Total minimum lease payment receivable	$	29,519	$	29,803
Less: unearned income	(13,698)		(13,952)
Investment in financing leases, net	$	15,821	$	15,851

Revenue earned under direct financing leases for each of the three months ended March 31, 2026 and 2025 were $0.3 million, which is recorded in "Fee and other" in the Consolidated Statements of Operations and Comprehensive Income (Loss).

Future lease payments to be received under the Company’s direct financing leases as of March 31, 2026 for the next five years and thereafter are as follows (in thousands):

As a lessee, the Company has ground and office leases which were classified as operating leases. As of March 31, 2026, these leases had remaining terms, including renewal options, of 2.1 years to 56.8 years and a weighted average remaining lease term of 18.6 years. Operating right-of-use ("ROU") assets and lease liabilities are included in “Prepaid expenses and other assets, net” and “Accounts payable, accrued expenses and other, net” on the Consolidated Balance Sheets as follows (in thousands):


	As of March 31, 2026		As of December 31, 2025
ROU asset – operating leases	$	2,175	$	2,236
Lease liability – operating leases	$	2,013	$	2,064

The difference between the recorded ROU assets and lease liabilities is mainly due to the reclassification of the below market ground lease intangible asset which was included within the ROU assets recognized upon transition.

Operating lease assets and liabilities are measured at the commencement date based on the present value of future lease payments. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. The Company used a discount rate ranging from 4.25% to 6.95% based on the yield of its current borrowings in determining its lease liabilities.

Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The lease terms may include options to extend or terminate the lease if it is reasonably certain that the Company will exercise that option.

Operating lease expense for the three months ended March 31, 2026 and 2025 was $0.09 million. See Note 9. Related Party Transactions for more details.

Future minimum lease payments to be paid by the Company as a lessee for operating leases as of March 31, 2026 for the next five years and thereafter are as follows (in thousands):


2026 — Remaining	$	245
2027	333
2028	335
2029	341
2030	89
Thereafter	1,953
Total future minimum lease payments	3,296
Interest discount	(1,283)
Total	$	2,013