Annual Report for Fiscal Year Ending 12-31, 2025 (Form 10-K)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the financial statements and notes thereto appearing elsewhere in this Annual Report. In addition to historical data, this discussion contains forward-looking statements about our business, operations and financial performance based on current expectations that involve risks, uncertainties and assumptions. Our actual results may differ materially from those in this discussion as a result of various factors, including but not limited to those discussed under "Cautionary Note Regarding Forward-Looking Statements" and in "Item 1A.-Risk Factors" in this Annual Report.

References to "Class D-X" represents Class D-S shares (formerly named Class D shares) that were purchased during the Initial Share Offering Period and entitled to a fee waiver while they were outstanding, as described in this Annual Report. As of December 31, 2025, no Class D-X shares were outstanding. All Class D-X shares were automatically converted into Class D-S shares.

Overview

Fortress Net Lease REIT invests primarily in single-tenant, net leased assets. We own all or substantially all of our assets through the Operating Partnership. FNLR GP LLC is a wholly-owned subsidiary of the Company and is the sole general partner of the Operating Partnership. We are externally managed by the Company Management, LLC. The Company's principal business is the acquisition, ownership, financing and leasing of single-tenant commercial real estate properties subject to long-term net leases with investment grade and other creditworthy tenants or guarantors, and our management does not distinguish our principal business, or group our operations, by geography or property type for purposes of measuring performance. Accordingly, we have only one reportable segment.

The Company was formed on January 24, 2023 (the "Date of Formation") as a Maryland statutory trust; however, no activity occurred until we acquired our first property on September 28, 2023 (the "Inception").

The Company is a non-listed, perpetual life REIT that has elected to be taxed as a REIT under the Code for U.S. federal income tax purposes. The Company generally will not be subject to U.S. federal income taxes on our taxable income to the extent we annually distribute all of our net taxable income to shareholders and maintain our qualification as a REIT.

As of December 31, 2025, we have received aggregate proceeds of $1.5 billion from the sale of our common shares. The Company has contributed the proceeds to the Operating Partnership in exchange for a corresponding number of Operating Partnership units that correspond to the classes of our shares sold. The Operating Partnership has primarily used the proceeds to make investments in real estate as further described below under "Overall Portfolio." The Company intends to continue selling shares on a monthly basis.

Market Conditions and Trends

The Company's businesses are materially affected by conditions in the financial markets and economic conditions in the United States and, to a lesser extent, elsewhere in the world.

During the year ended 2025, the persistence of elevated inflation and uncertainty surrounding interest rates, in conjunction with geopolitical instability (including the conflict between Russia and Ukraine, the ongoing and developing conflicts in the Middle East or the recent U.S. military action in Venezuela), and limited visibility into future capital availability continued to weigh on industry deal activity and market valuations.

Our real estate business, focused on triple net leases, continued to deploy significant capital. Our investors continue to benefit from the inflation-mitigating characteristics and long term risk adjusted returns of the net lease structure, including contractually guaranteed and highly predictable net rent growth and long-duration income flows across the portfolio.

We are continuing to closely monitor developments related to the macroeconomic factors that have contributed to market volatility, and to assess the impact of these factors on financial markets and on our business. Our future results may be adversely affected by slowdowns in fundraising activity and the pace of capital deployment. It remains difficult to predict the ultimate effects of these

events on the financial markets, overall economy, and our financial statements. See "Item 1A. Risk Factors-Risks Related to Our Business and Operations."

Recent Developments

Since December 31, 2025, through and including the date hereof, we (i) have acquired four retail properties and 11 industrial properties for $7.6 million and $110.9 million, respectively, (ii) repaid $163.0 million and drew an additional $87.4 million on the Secured Revolving Credit Facility, (iii) drew an additional $22.5 million on the Term Loan Facility and (iv) issued and sold an aggregate of 16,609,907 common shares in our private offering, resulting in proceeds of $172.5 million (see Note 14 to our consolidated financial statements and the section titled "Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.")

Fifth Amendment to Credit Agreement

On January 29, 2026, the Operating Partnership, as borrower, the Company, as guarantor, the other guarantors party thereto (together with the Company, the "Guarantors" and, collectively with the Operating Partnership, the "Loan Parties"), entered into that certain Fifth Amendment to Credit Agreement (the "Fifth Amendment") with each lender party thereto and Bank of America, N.A., as administrative agent (the "Administrative Agent"), amending that certain Credit Agreement, initially dated August 13, 2024 and as most recently amended on November 20, 2025 (and as amended by the Fifth Amendment, the "Credit Agreement"), among the Loan Parties, the lenders party thereto and the Administrative Agent. Capitalized terms used in this description and not otherwise defined herein shall have the meaning attributed to such terms in the Credit Agreement.

Pursuant to the Fifth Amendment, the aggregate principal amount of the Credit Facilities was increased from $1,650,000,000 to $1,800,000,000 in the form of (i) an increase in the aggregate commitments to the revolving credit facility from $1,347,500,000 to $1,475,000,000 (the "Revolving Credit Facility"), and (ii) an increase in the term loan facility from $302,500,000 to $325,000,000 (the "Term Loan Facility"; and together with the Revolving Credit Facility, collectively, the "Credit Facilities"). In addition, the Fifth Amendment (x) increased from 15% to 30% the cap on the Borrowing Base Value attributable to Borrowing Base Properties that have Commercial Net Leases with tenants that are retail branches of banks, credit unions, or other financial institutions, (y) updated the calculations of unused fee, and (z) clarified the lenders entitled to the unused fee. Old National Bank also joined as a new lender.

The foregoing description is only a summary of the material provisions of the Fifth Amendment and is qualified in its entirety by reference to the full text of the Fifth Amendment, which is filed as Exhibit 10.23 to this Annual Report and incorporated by reference herein.

First Amendment to Subsidiary Loan Agreement and Assignment and Assumption

On February 25, 2026, the Borrower entered into that certain Omnibus First Amendment to Loan Documents and Guarantor Reaffirmation (the "First Amendment to Subsidiary Loan Agreement"), by and among the Subsidiary Loan Administrative Agent, the Borrower and the Operating Partnership. The First Amendment to Subsidiary Loan Agreement amended the Subsidiary Loan Agreement to, among other things, (i) update the definition of Affiliate to expressly exclude the Mubadala Group as an Affiliate of Borrower, Operating Partnership, Fortress or any of their subsidiaries, (ii) eliminate certain restrictions on lenders in the event of a lender assignment, participation or pledge if an Event of Default exists, (iii) require the delivery of unaudited quarterly financial statements even when a Cash Sweep Period does not exist and (iv) clarify the requirements for an acceptable SOFR Swap Contract based on the outstanding principal balance of the Loan. Capitalized terms used in this paragraph and not otherwise defined herein shall have the meaning attributed to such terms in the Subsidiary Loan Agreement.

On February 25, 2026, Bank of America, N.A., as a lender, U.S. Bank National Association and the Subsidiary Loan Administrative Agent entered into that certain Assignment and Assumption, pursuant to which U.S. Bank National Association was joined as a new lender to the Subsidiary Loan Agreement.

The foregoing description is only a summary of the material provisions of the First Amendment to Subsidiary Loan Agreement and is qualified in its entirety by reference to the full text of the First Amendment to Subsidiary Loan Agreement which is filed as Exhibit 10.25 to this Annual Report and incorporated by reference herein.

Emerging Growth Company Status

We are and will remain an "emerging growth company" as defined in the JOBS Act until the earlier of (a) the last day of the fiscal year (i) following the fifth anniversary of the date of an initial public offering pursuant to an effective registration statement under the Securities Act, (ii) in which we have total annual gross revenue of at least $1.235 billion, or (iii) in which we are deemed to be a large accelerated filer, which means the market value of our shares that is held by non-affiliates exceeds $700 million as of the date of our most recently completed second fiscal quarter, and (b) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. For so long as we remain an "emerging growth company" we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act. We cannot predict if investors will find our shares less attractive because we may rely on some or all of these exemptions.

In addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We will take advantage of the extended transition period for complying with new or revised accounting standards, which may make it more difficult for investors and securities analysts to evaluate us since our financial statements may not be comparable to companies that comply with public company effective dates. Also, because we are not a large accelerated filer or an accelerated filer under Section 12b-2 of the Exchange Act, and will not be for so long as our common shares are not traded on a securities exchange, we will not be subject to auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act even once we are no longer an emerging growth company.

Year Ended 2025 Highlights

Operating Results

Investments

Capital Activity and Financings

Overall Portfolio

Investment Portfolio

Real Estate Investments

The following chart describes the diversification of our real estate portfolio based on gross asset cost as of December 31, 2025:

1)Property Type weighting is measured as the gross asset cost of real estate investments for each property type divided by the gross asset cost of all real estate investments.

The following chart further describes the diversification of our real estate portfolio based on number of properties as of December 31, 2025:

1)Region Concentration represents regions as defined by the Nation Council of Real Estate Fiduciaries ("NCREIF") and the weighting is measured as the number of properties in our real estate portfolio for each regional category divided by the total number of all real estate properties.

The following table provides a summary of our real estate portfolio as of December 31, 2025 ($ and square feet in thousands):

The following table summarizes the Company's build-to-suit development projects as of December 31, 2025 ($ in thousands):

Lease Expirations

The following schedule details the expiring leases at our real estate properties by annualized base rent and square footage as of December 31, 2025 ($ and square feet in thousands):

Results of Operations

The following table sets forth the results of our operations for the years ended December 31, 2025 and 2024 ($ in thousands, except per share data):

Revenue

Rental Revenue

Rental revenue increased $142.9 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $41.4 million to $184.3 million. The increase in respective revenues during the periods presented is primarily due to an increase in the real estate portfolio from 136 properties as of December 31, 2024, to 274 properties as of December 31, 2025.

Expenses

Organizational costs

Organizational costs decreased $3.2 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $3.2 million to $0. The decrease in respective organizational costs during the periods presented is due to the Company incurring various one-time organizational costs in 2024 and 2023 upon formation of the fund.

General and Administrative Expenses

General and administrative expenses increased $6.3 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $8.2 million to $14.5 million. The increase in respective general and administrative expenses is primarily due to increases in professional fees driven by growth of the fund.

Management Fee

Management fee expense increased $8.5 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $3.6 million to $12.1 million. The increase in respective management fee expense is primarily due to an increase in NAV.

Performance Participation Allocation

Performance participation allocation expense increased $6.5 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $1.9 million to $8.4 million. The increase in respective performance participation allocation expense is primarily due to an increase of common shares subject to the performance participation allocation, as well as an increase in total return.

Depreciation and Amortization

Depreciation and amortization expenses increased $53.2 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $14.0 million to $67.2 million. The increase in depreciation and amortization expenses during the periods presented is primarily due to an increase in the real estate portfolio from 136 properties as of December 31, 2024, to 274 properties as of December 31, 2025, respectively.

Other Income (Expense)

Interest Income

Interest income decreased $3.8 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $5.2 million to $1.4 million. The decrease in interest income during the respective periods is primarily due to a decrease in cash deposited into an interest earning money market account.

Interest Expense, net

Interest expense, net increased $52.4 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $4.2 million to $56.6 million. The increase in interest expense, net during the respective periods is primarily due to increased borrowings on the Company's Credit Facilities and entering into two subsidiary loans during the year ended December 31, 2025.

Net Asset Value

EA RESIG, LLC, a subsidiary of Eisner, calculates our NAV per share, which our Adviser subsequently reviews and confirms the calculations in connection therewith, in each case, in accordance with the valuation guidelines that have been approved by our board of trustees. Our total NAV presented in the following tables includes the NAV of our outstanding classes of common shares, which includes Class S, Class I, Class F-S, Class F-I, Class D-S, and Class E common shares, as well as the partnership interests ("OP Units") of the Operating Partnership, if any, held by parties other than the Company. The following table provides a breakdown of the major components of our NAV as of December 31, 2025 ($ in thousands):

The following table provides a breakdown of our total NAV and NAV per share/unit by class as of December 31, 2025 ($ in thousands, except per share data):

The following table details the weighted average capitalization rate by property type, which is the key assumption used in the valuations as of December 31, 2025:

(1)Excludes Data Centers, as these properties are subject to build-to-suit leases and were under development as of December 31, 2025.

The capitalization rates are determined by the Adviser and reviewed by the Company's independent valuation advisor. A change in the capitalization rates would impact the calculation of the value of our real estate investments. For example, assuming all other factors remain unchanged, the changes listed below would result in the following effects on our investment values:

Recently acquired properties are carried at cost, which approximates fair value.

The following table reconciles equity per our Consolidated Balance Sheet to our NAV ($ in thousands):

The following details the adjustments to reconcile accounting principles generally accepted in GAAP equity and total partners' capital of the Operating Partnership to our NAV:

Distributions

Beginning on November 30, 2023, we declared monthly distributions for each class of our common shares, which are generally paid four days after month-end. The net distribution may vary for each class based on the applicable shareholder servicing fee, which is deducted from the monthly distribution per share and paid directly to the Dealer Manager for further remittance to the applicable distributor.

The following table details the total net distribution for each of our share classes for the year ended December 31, 2025:

For the year ended December 31, 2025, we declared distributions in the amount of $82.6 million. The Company intends for long-term cumulative distributions to be funded primarily from operating cash flows. The following table details our distributions declared for the year ended December 31, 2025 ($ in thousands):

Funds from Operations

We believe funds from operations ("FFO") is a meaningful non-GAAP supplemental measure of our operating results. Our consolidated financial statements are presented using historical cost accounting which, among other things, requires depreciation of real estate investments to be calculated on a straight-line basis. As a result, our operating results imply that the value of our real estate investments have decreased over time. However, we believe that the value of our real estate investments will fluctuate over time based on market conditions and, as such, depreciation under historical cost accounting may be less informative as a measure of our performance. FFO is an operating measure defined by the National Association of Real Estate Investment Trusts ("NAREIT") that is broadly used in the REIT industry. FFO, as defined by NAREIT and presented below, is calculated as net income or loss (computed in accordance with GAAP), excluding (i) depreciation and amortization, (ii) impairment of investments in real estate, (iii) net gains or losses from sales of real estate, and (iv) similar adjustments for non-controlling interests and unconsolidated entities.

FFO should not be considered more relevant or accurate than GAAP net income (loss) in evaluating our performance. In addition, FFO should not be considered as an alternative to net income (loss) as an indication of our performance or as an alternative to cash flows from operating activities as an indication of our liquidity, but rather should be reviewed in conjunction with these and other GAAP measurements. Further, FFO is not intended to be used as liquidity measures indicative of cash flow available to fund our cash needs, including our ability to make distributions to our shareholders. In addition, our methodology for calculating FFO may differ from the methodologies employed by other companies to calculate the same or similar supplemental performance measures, and accordingly, our reported FFO may not be comparable to the FFO reported by other companies.

The following table presents a reconciliation of net income to FFO ($ in thousands):

Liquidity and Capital Resources

Liquidity

We believe we have sufficient liquidity to operate our business, with immediate liquidity comprised of cash and cash equivalents of $4.0 million and $337.4 million available under the Credit Facilities as of December 31, 2025. In addition to our immediate liquidity, we obtain incremental liquidity through the sale of our common shares, from which we generated proceeds of $676.3 million for the year ended December 31, 2025. We may incur indebtedness secured by our real estate and real estate debt investments, borrow money through unsecured financings, or incur other forms of indebtedness. We may also generate incremental liquidity through the sale of our real estate and other real estate investments. We closely monitor our liquidity position and believe that we have sufficient current liquidity and access to additional liquidity to meet our financial obligations and comply with our debt covenants for at least the next 12 months.

Our primary liquidity needs are to fund our investments, make distributions to our shareholders, repurchase common shares pursuant to our share repurchase plan, pay operating expenses, fund capital expenditures, and repay indebtedness. Our operating expenses include, among other things, the management fee we pay to the Adviser and the performance participation allocation that the Operating Partnership pays to the Special Limited Partner, both of which may impact our liquidity to the extent the Adviser or the Special Limited Partner elect to receive such payments in cash, or subsequently redeem shares or Operating Partnership units previously issued to them.

Our cash needs for acquisitions and other capital investments will be funded primarily from the sale of common shares and through the incurrence or assumption of debt. We plan on fulfilling our outstanding commitment obligations for properties under development from the sale of common shares. Other potential future sources of capital include secured or unsecured financings from banks or other lenders and proceeds from the sale of assets. If necessary, we may use financings or other sources of capital in the event of unforeseen significant capital expenditures. We continue to believe that our current liquidity position is sufficient to meet the need of our expected investment activity.

Capital Resources

For the year ended December 31, 2025, we issued and sold 66,014,546 common shares, consisting of 14,670 Class S shares, 12,873,255 Class I shares, 21,336,839 Class F-S shares, 28,792,745 Class F-I shares, 756,633 Class D-S shares and 2,240,403 Class E shares to accredited investors in our private offering, amounting to proceeds of $676.3 million as payment for such shares, including shares issued pursuant to our distribution reinvestment plan. Additionally, 67,171 of Class E common shares were issued as a payment of $0.7 million of management fees incurred. 29,155 of Class E common shares were issued to the board of trustees as payment for $0.3 million of compensation expense for 2024 fiscal year service. During the year ended December 31, 2025, the Company repurchased 1,581,009 common shares for $16.4 million and 672,987 Class A OP units for $7.2 million. We had no outstanding repurchase requests as of December 31, 2025.

As of December 31, 2025, we had received aggregate proceeds of $1.5 billion from the issuance and sale of common shares in our private offering and pursuant to our distribution reinvestment program. As of December 31, 2025, after giving effect to shares issued pursuant to our distribution reinvestment plan, share transfers, conversions, and redemptions we had an aggregate of 145,448,949 common shares outstanding, consisting of 14,670 Class S shares, 12,842,095 Class I shares, 24,311,883 Class F-S shares, 68,237,184 Class F-I shares, 37,527,819 Class D-S shares and 2,515,299 Class E shares. Additionally, we had 29,155 Class E shares outstanding that were issued to the board of trustees as payment for 2024 fiscal year service.

Credit Facilities

On August 13, 2024, the Operating Partnership, as borrower, the Company, as guarantor, the other guarantors party thereto, BofA Securities, Inc., as sole bookrunner and sole lead arranger, entered into that certain Credit Agreement with BofA, as the Administrative Agent and the sole letter of credit issuer ("L/C Issuer") thereto, and the lenders party thereto from time to time, pursuant to which the facilities were initially comprised of (i) a $120.0 million revolving credit facility, of which $25.0 million was available for standby letters of credit and (ii) a $5.0 million term loan credit facility. Subject to the terms and conditions of the Credit Facilities, all commitments and amounts outstanding under the Credit Facilities were initially due and payable in full on the third anniversary of the closing date of the Credit Facilities. The Credit Facilities also provide for a feature that allows the Company, under certain circumstances, to increase the overall size of the Credit Facilities to a maximum of $1.0 billion (such amount, the "Incremental Facility Maximum").

On October 18, 2024, the Credit Facilities were amended to increase the aggregate commitments under the Revolving Credit Facility from $120.0 million to $350.0 million and the aggregate outstanding principal amount of the Term Loan Facility from $5.0 million to $100.0 million. Additionally, the maturity date of the Credit Facilities was amended such that all commitments and outstanding amounts under the Credit Facilities would be due in full on October 17, 2025 and the number of one-year extension options was increased from one option to three options. On October 17, 2025, the Company exercised the first extension option in order to extend the maturity date to October 16, 2026. Prior to October 16, 2026, the Company plans to exercise the second extension option in order to extend the maturity date to October 16, 2027.

On November 21, 2024, the Credit Facilities were amended to increase the aggregate commitments under the Revolving Credit Facility from $350.0 million to $427.5 million, to increase the aggregate outstanding principal amount of the Term Loan Facility from $100.0 million to $122.5 million and to add Truist Bank as a new lender thereunder.

On December 19, 2024, the Credit Facilities were supplemented to increase the aggregate commitments under the Revolving Credit Facility from $427.5 million to $677.5 million.

On February 6, 2025, the Credit Facilities were amended to increase the aggregate commitments under the Revolving Credit Facility from $677.5 million to $755.0 million, to increase the aggregate outstanding principal amount of the Term Loan Facility from $122.5 to $145.0 million and to add The Huntington National Bank as a new lender thereunder.

On April 11, 2025, the Credit Facilities were amended, pursuant to which the Incremental Facility Maximum was increased to $1.5 billion. In connection with the effectiveness of the new Incremental Facility Maximum, the aggregate principal amount of the Credit Facilities was increased from $900,000,000 to $1,075,000,000 in the form of (i) an increase in the aggregate commitments under

the Revolving Credit Facility from $755.0 million to $892.5 million, of which $25.0 million is available for standby letters of credit and (iii) an increase in the aggregate outstanding principal amount of the Term Loan Facility from $145.0 million to $182.5 million.

On July 25, 2025, the Credit Facilities were amended (the "Third Amendment") to increase the aggregate commitments under the Revolving Credit Facility from $892.5 million to $1,047.5 million and to increase the aggregate outstanding principal amount of the Term Loan Facility from $182.5 million to $227.5 million. In addition, pursuant to the Third Amendment, subject to the satisfaction of certain criteria and conditions, the Loan Parties may offer Loan Assets (as defined in the Third Amendment) that qualify as First Mortgage Investments (as defined in the Third Amendment) to be included in the calculation of Borrowing Base Value (as defined in the Third Amendment).

On November 20, 2025, the Credit Facilities were amended (the "Fourth Amendment") to increase the aggregate commitments to the Revolving Credit Facility from $1,047.5 million to $1,347.5 million and to increase the aggregate outstanding principal amount of the Term Loan Facility from $227.5 million to $302.5 million. In addition, the Fourth Amendment expanded the accordion feature to permit future increases in the aggregate principal amount of the Credit Facilities up to $2,500,000,000, introduced a new multicurrency tranche (the "Multicurrency Tranche") under the Revolving Credit Facility to allow borrowings in certain alternative currencies (including Euro, British Pound Sterling and Canadian Dollar), and temporarily increased the borrowing base advance rate to 65% from 60% through March 31, 2026.

On January 29, 2026, the Credit Facilities were amended to increase the aggregate commitments to the Revolving Credit Facility from 1,347.5 million and to increase the aggregate outstanding principal amount of the Term Loan Facility from $302.5 million to $325.0 million. In addition, the Fifth Amendment (x) increased from 15% to 30% the cap on the Borrowing Base Value attributable to Borrowing Base Properties that have Commercial Net Leases with tenants that are retail branches of banks, credit unions, or other financial institutions, (y) updated the calculations of unused fee, and (z) clarified the lenders entitled to the unused fee. Old National Bank also joined as a new lender. Capitalized terms used in this paragraph and not otherwise defined herein shall have the meaning attributed to such terms in the Credit Agreement.

The Credit Facilities are unsecured obligations of the Loan Parties. At the option of the Borrower, the Credit Facilities will bear interest at either (i) a rate equal to term secured overnight financing rate ("SOFR") or daily simple SOFR plus a margin rate ranging from 1.40% to 1.90% or (ii) a base rate based on the highest of (A) Federal Funds Rate plus half of 1%, (B) BofA's prime rate, (C) Term SOFR plus 1.00% and (D) 1.00%, plus a margin ranging from 0.40% to 0.90%. As of December 31, 2025, the interest rate applicable to the Credit Facilities was Term SOFR plus 1.65%. The Revolving Credit Facility is subject to a per annum fee based on the daily unused portion of the facility ranging from 0.15% to 0.25% and is payable quarterly in arrears. The Credit Facilities are prepayable, in whole or in part, at any time without premium or penalty.

The Credit Facilities contain various restrictions and covenants applicable to the Loan Parties that are customary for similar credit facilities, including restrictions on our ability to incur indebtedness, incur liens and make certain investments. Among other requirements, the Loan Parties may not exceed certain debt limitations and must ensure compliance with certain financial ratios. As of December 31, 2025, the Company was in compliance with all of its loan covenants.

The Credit Facilities also contain customary events of default. If an event of default under the Credit Facilities occurs and is continuing, then BofA may declare any outstanding obligations under the Credit Facilities to be immediately due and payable. In addition, if the Borrower becomes the subject of voluntary or involuntary proceedings under any bankruptcy, insolvency or similar law, then any outstanding obligations under the Credit Facilities will automatically become due and payable.

Subsidiary Loan

On September 19, 2025, FNLR Logistics LLC, a Delaware limited liability company ("Borrower 1") and FNLR Grocery LLC, a Delaware limited liability company ("Borrower 2" and Borrower 1 and Borrower 2 are, individually and/or collectively (as the context requires) referred to herein as "Borrower"), each an indirect, wholly-owned subsidiary of the Company, entered into a Loan Agreement (the "Subsidiary Loan Agreement") with Bank of America, N.A., as administrative agent (in such capacity, the "Subsidiary Loan Administrative Agent"), and the lenders from time to time party thereto. Pursuant to the Subsidiary Loan Agreement, the lenders agreed to make loans available to Borrower on an uncommitted basis in an aggregate principal amount not to exceed $347,500,000 (the "Subsidiary Loan"). Subject to the terms and conditions of the Subsidiary Loan Agreement, all amounts

outstanding under the Subsidiary Loan Agreement will be due and payable in full on September 19, 2028 subject to two (2) extension options of one (1) year each, which if exercised would expire on September 19, 2030, or such earlier date upon which the Subsidiary Loan Agreement shall terminate in accordance with the provisions thereof.

On November 25, 2025, the Borrower entered into a Letter Amendment to the Subsidiary Loan Agreement, by and among the Subsidiary Loan Administrative Agent, the Borrower and the Operating Partnership, pursuant to which certain representation of the Borrower was revised to include specific provisions related to the Jurupa Valley Net Lease, as defined and described therein.

On February 25, 2026, the Borrower entered into the First Amendment to Subsidiary Loan Agreement, by and among the Subsidiary Loan Administrative Agent, the Borrower and the Operating Partnership. The First Amendment to Subsidiary Loan Agreement amended the Subsidiary Loan Agreement to, among other things, (i) update the definition of Affiliate to expressly exclude the Mubadala Group as an Affiliate of Borrower, Operating Partnership, Fortress or any of their subsidiaries, (ii) eliminate certain restrictions on lenders in the event of a lender assignment, participation or pledge if an Event of Default exists, (iii) require the delivery of unaudited quarterly financial statements even when a Cash Sweep Period does not exist and (iv) clarify the requirements for an acceptable SOFR Swap Contract based on the outstanding principal balance of the Loan. Capitalized terms used in this paragraph and not otherwise defined herein shall have the meaning attributed to such terms in the Subsidiary Loan Agreement.

On February 25, 2026, Bank of America, N.A., as a lender, U.S. Bank National Association and the Subsidiary Loan Administrative Agent entered into that certain Assignment and Assumption, pursuant to which U.S. Bank National Association was joined as a new lender to the Subsidiary Loan Agreement.

The obligations of Borrower under the Subsidiary Loan Agreement are secured by substantially all of the assets of each Borrower, in each case subject to certain exclusions set forth in the Subsidiary Loan Agreement and the other Loan Documents (as defined in the Subsidiary Loan Agreement). Further, the Subsidiary Loan will bear interest at the lesser of (i) a rate equal to Monthly SOFR, plus one hundred seventy basis points (1.70%) per annum and (ii) the maximum non-usurious interest rate. The Subsidiary Loan is prepayable, in whole or in part, at any time without premium or penalty, in accordance with the terms of the Subsidiary Loan Agreement.

The Subsidiary Loan Agreement contains various restrictions and covenants applicable to Borrower. Among other requirements, Borrower may not exceed certain debt limitations and is subject to certain distribution limitations, subject to certain carveouts described more fully therein.

The Subsidiary Loan Agreement also contains customary events of default. If an event of default under the Subsidiary Loan Agreement occurs and is continuing, then the Subsidiary Loan Administrative Agent may declare any outstanding obligations under the Subsidiary Loan Agreement to be immediately due and payable. In addition, if Borrower becomes the subject of voluntary or involuntary proceedings under any bankruptcy, insolvency or similar law, then any outstanding obligations under the Subsidiary Loan Agreement will automatically become due and payable.

In connection with the Subsidiary Loan Agreement, the Operating Partnership, provided a guaranty (the "Carveout Guaranty"), pursuant to which the Operating Partnership (i) has agreed to guarantee the payment of the indebtedness pursuant to the Subsidiary Loan Agreement in the event of specified non-recourse carve-outs referred to as "Enforcement Events" with respect to the Borrower or any property and (ii) agreed to satisfy certain financial covenants as set forth in the Carveout Guaranty, including minimum net worth and liquidity requirements. The Operating Partnership is also liable under the Carveout Guaranty for costs, expenses, damages and losses actually incurred by the Subsidiary Loan Administrative Agent resulting from customary "bad boy" events pertaining to the Operating Partnership as described more fully in the Carveout Guaranty.

Print Subsidiary Loan

On December 23, 2025, FNLR Print LLC, a Delaware limited liability company ("Print"), an indirect, wholly-owned subsidiary of the Company, entered into a Loan Agreement (the "Print Subsidiary Loan Agreement") with Bank of America, N.A., as administrative agent (in such capacity, the "Print Administrative Agent"), and the lenders from time to time party thereto. Pursuant to the Print Subsidiary Loan Agreement, the lenders agreed to make loans available to Print on an uncommitted basis in an aggregate principal amount not to exceed $111,100,000 (the "Print Subsidiary Loan"). Subject to the terms and conditions of the Print Subsidiary Loan Agreement, all amounts outstanding under the Print Subsidiary Loan Agreement will be due and payable in full on December 23, 2028, or such earlier date upon which the Print Subsidiary Loan Agreement shall terminate in accordance with the provisions thereof. Capitalized terms used under this description of the Print Subsidiary Loan Agreement and not otherwise defined herein shall have the meaning attributed to such terms in the Print Subsidiary Loan Agreement.

The obligations of Print under the Print Subsidiary Loan Agreement are secured by substantially all of the assets of Print, subject to certain exclusions set forth in the Print Subsidiary Loan Agreement and the other loan documents. Further, the Print Subsidiary Loan will bear interest at the lesser of (i) a rate equal to Monthly SOFR, plus one hundred ninety basis points (1.90%) per annum and (ii) the maximum non-usurious interest rate. The Print Subsidiary Loan is prepayable, in whole or in part, at any time without premium or penalty, in accordance with the terms of the Print Subsidiary Loan Agreement.

The Print Subsidiary Loan Agreement contains various restrictions and covenants applicable to Print. Among other requirements, Print may not exceed certain debt limitations and is subject to certain distribution limitations, subject to certain carveouts described more fully therein.

The Print Subsidiary Loan Agreement also contains customary events of default. If an event of default under the Print Subsidiary Loan Agreement occurs and is continuing, then the Print Administrative Agent may declare any outstanding obligations under the Print Subsidiary Loan Agreement to be immediately due and payable. In addition, if Print becomes the subject of voluntary or involuntary proceedings under any bankruptcy, insolvency or similar law, then any outstanding obligations under the Print Subsidiary Loan Agreement will automatically become due and payable.

In connection with the Print Subsidiary Loan Agreement, Operating Partnership provided a guaranty (the "Print Carveout Guaranty"), pursuant to which Operating Partnership (i) agreed to guarantee certain post-closing obligations of Print under the Print Subsidiary Loan Agreement related to certain title insurance policy, (ii) agreed to guarantee the payment of the indebtedness pursuant to the Print Subsidiary Loan Agreement in the event of specified non-recourse carve-outs referred to as "Enforcement Events" with respect to Print or any property and (iii) agreed to satisfy certain financial covenants as set forth in the Carveout Guaranty, including minimum net worth and liquidity requirements. Operating Partnership is also liable under the Carveout Guaranty for costs, expenses, damages and losses actually incurred by the Print Administrative Agent resulting from customary "bad boy" events pertaining to Operating Partnership as described more fully in the Carveout Guaranty.

Cash Flows

Cash flows provided by operating activities increased $50.9 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $34.1 million to $85.0 million. The increase in cash flows provided by operating activities is primarily attributable to the growth of our real estate portfolio, which increased by 138 properties for the year ended December 31, 2025 compared to the year ended December 31, 2024 from 136 properties to 274 properties.

Cash flows used in investing activities increased $613.5 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $1.2 billion to $1.9 billion. The increase in cash flows used in investing activities is primarily attributable to the growth of our real estate portfolio, of which $1.7 billion was used to acquire 133 operating properties and fund deposits for future acquisitions. Additionally, $165.3 million was used to fund construction in progress for eight build-to-suit properties for the year ended December 31, 2025.

Cash flows provided by financing activities increased $312.9 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 from $1.3 billion to $1.6 billion. The increase is primarily attributable to $401.2 million increase of net cash inflows from borrowings and repayments of the credit facility and term loans, offset by a $40.3 million decrease in

subscriptions received in advance and $26.5 million increase of distributions to common shareholders for the year ended December 31, 2025.

Future Cash Requirements

The following table aggregates our contractual obligations and commitments as of December 31, 2025 ($ in thousands):

(1) For loans where the Company, at its own discretion, has extension options, the maximum maturity date has been assumed.

Critical Accounting Estimates

The preparation of our financial statements in accordance with GAAP involve significant judgments and assumptions and require estimates about matters that are inherently uncertain. These judgments will affect our reported amounts of assets and liabilities and our disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in our consolidated financial statements. The following is a summary of our significant accounting policies that we believe are the most affected by our judgments, estimates, and assumptions. See "Item 8. Financial Statements and Supplementary Data-Notes to Consolidated Financial Statements-Note 2. Summary of Significant Accounting Policies" for further descriptions of the below accounting policies.

Investments in Real Estate

We expect that most of our acquisitions will qualify as asset acquisitions rather than business combinations pursuant to ASC 805, Business Combinations. Upon the acquisition of a property, we assess the fair value of the acquired tangible and intangible assets (including land, buildings, tenant improvements, "above-market" and "below-market" leases, acquired in-place leases, other identified intangible assets and assumed liabilities) and we allocate the purchase price, including acquisition costs, to the acquired assets and assumed liabilities, on a relative fair value basis. The most significant portion of the allocation is to buildings, land, and construction in process and requires the use of market based estimates and assumptions. We assess and consider fair value based on estimated cash flow projections that utilize appropriate discount and/or capitalization rates, as well as other available market information. Estimates of future cash flows are based on a number of factors including historical operating results, known and anticipated trends, and market and economic conditions.

The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant. We also consider an allocation of purchase price of other acquired intangibles, including acquired in-place leases that may have intangible value, such as customer relationships, including (but not limited to) the nature and extent of the existing relationship with the tenants, the tenants' credit quality and expectations of lease renewals.

Acquired above-market and below-market leases are recorded at their fair values (using a discount rate which reflects the risks associated with the leases acquired) equal to the difference between (1) the contractual amounts to be paid pursuant to each in-place lease and (2) management's estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed rate renewal options for below-market leases.

Other intangible assets acquired include amounts for in-place lease values that are based on our evaluation of the specific characteristics of each tenant's lease. Factors to be considered include estimates of carrying costs during hypothetical expected lease-up periods considering current market conditions, and costs to execute similar leases. In estimating carrying costs, we include real estate taxes, insurance and other operating expenses, if any, and estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions. In estimating costs to execute similar leases, we consider leasing commissions, legal and other related expenses.

Impairment of Investments in Real Estate and Intangible Assets

We review real estate properties for impairment each quarter or when there is an event or change in circumstances that indicates an impaired value. If the carrying amount of the real estate investment is no longer recoverable and exceeds the fair value of such investment, an impairment loss is recognized. The impairment loss is recognized based on the excess of the carrying amount of the asset over its fair value. The evaluation of anticipated future cash flows is highly subjective and is based in part on assumptions regarding future occupancy, rental rates and capital requirements that could differ materially from actual results. Since cash flows on real estate properties considered to be "long-lived assets to be held and used" are considered on an undiscounted basis to determine whether an asset has been impaired, our strategy of holding properties over the long term directly decreases the likelihood of recording an impairment loss. If our strategy changes or market conditions otherwise dictate an earlier sale date, an impairment loss may be recognized, and such loss could be material to our results. If we determine that an impairment has occurred, the affected assets must be reduced to their fair value.

We review indefinite-lived intangible assets for impairment annually or when there is an event or change in circumstances that indicates a decrease in value. If there are qualitative factors that indicate it is more likely than not that the indefinite-lived intangible asset is impaired, we calculate the fair value of the asset and record the impairment charge if the carrying amount exceeds the fair value. This new cost basis will be used for future periods when recording subsequent income or loss and cannot be written up to a higher value as a result of increases in fair value.

Recent Accounting Pronouncements

See "Notes to Consolidated Financial Statements-2. Summary of Significant Accounting Policies" for a discussion concerning recent accounting pronouncements.