Gladstone Land Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Lease Revenues

Lease Revenues

9 Months Ended

Sep. 30, 2023

The following table sets forth the components of our lease revenue for the three and nine months ended September 30, 2023 and 2022 (dollars in thousands, except for footnotes):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Fixed lease payments(1)	$	21,102	$	21,178	$	63,180	$	61,387
Variable lease payments(2)	2,432		3,031		2,766		3,058
Lease revenue, net(3)	$	23,534	$	24,209	$	65,946	$	64,445

(1)Fixed lease payments include contractual rents under lease agreements with tenants recognized on a straight-line basis over the respective lease terms and includes the amortization of above-market lease values and lease incentives and the accretion of below-market lease values and other deferred revenue.

(2)Variable lease payments primarily consist of participation rents, which are generally based on a percentage of the gross crop revenues earned on the farm, and reimbursements of certain property operating expenses by tenants. Participation rents are generally recognized when all contingencies have been resolved and when actual results become known or estimable, enabling us to estimate and/or measure our share of such gross revenues. During the three and nine months ended September 30, 2023, we recorded participation rents of approximately $2.4 million and $2.6 million, respectively, and reimbursements of certain property operating expenses by tenants of approximately $47,000 and $140,000, respectively. During the three and nine months ended September 30, 2022, we recorded participation rents of approximately $3.0 million during each period and reimbursements of certain property operating expenses by tenants of approximately $28,000 and $34,000, respectively. In addition, during the three and nine months ended September 30, 2023, we recorded late fees of approximately $0 and $46,000, respectively.

(3)Reflected as a line item on our accompanying Condensed Consolidated Statements of Operations and Comprehensive Income.