Gladstone Land Corporation Quarterly report [Sections 13 or 15(d)]

Quarterly report [Sections 13 or 15(d)]

INVESTMENTS IN WATER ASSETS

INVESTMENTS IN WATER ASSETS

3 Months Ended

Mar. 31, 2026

REAL ESTATE AND INTANGIBLE ASSETS

All of our properties are wholly-owned on a fee-simple basis, except where noted. The following table summarizes certain information about the 144 farms we owned as of March 31, 2026 (dollars in thousands, except for footnotes):


Location	No. of Farms	Total Acres	Farm Acres	Acre-feet of Water Assets	Net Cost Basis(1)		Encumbrances(2)
California(3)(4)(5)	63	34,845	32,321	55,649	$	807,045	$	368,043
Florida	18	10,412	8,635	0	111,581		45,424
Washington	6	2,520	2,004	0	50,355		14,489
Arizona(6)	6	6,320	5,333	0	47,809		12,000
Colorado	10	31,448	24,513	0	38,011		8,770
Oregon(7)	6	898	736	0	28,920		10,349
Nebraska	7	5,223	4,949	0	19,729		9,242
Michigan	12	1,245	778	0	14,394		8,348
Texas	1	3,667	2,219	0	9,298		—
Maryland	6	987	863	0	7,811		4,018
South Carolina	3	597	447	0	3,339		2,025
Georgia	2	230	175	0	2,219		1,529
New Jersey	3	116	101	0	2,010		1,147
Delaware	1	180	140	0	1,260		645

	144	98,688	83,214	55,649	$	1,143,781	$	486,029

(1)Consists of the initial acquisition price (including the costs allocated to both tangible and intangible assets acquired and liabilities assumed), plus subsequent improvements and other capitalized costs associated with the properties, and adjusted for accumulated depreciation and amortization. Specifically, includes Total real estate, net and Lease intangibles, net; plus long-term water assets and related acquisition costs included in Investments in water assets; net above-market lease values, net lease incentives, and net investments in special-purpose LLCs included in Other assets, net; and less net below-market lease values and other deferred revenue included in Other liabilities, net; each as shown on the accompanying Condensed Consolidated Balance Sheets.

(2)Excludes approximately $1.8 million of debt issuance costs related to notes and bonds payable, included in Notes and bonds payable, net on the accompanying Condensed Consolidated Balance Sheets.

(3)Includes ownership in a special-purpose LLC that owns a pipeline conveying water to certain of our properties. As of March 31, 2026, this investment had a net carrying value of approximately $775,000 and is included within Other assets, net on the accompanying Condensed Consolidated Balance Sheets.

(4)Includes eight acres in which we own a leasehold interest via a ground lease with a private individual that expires in December 2040 and five acres in which we own a leasehold interest via a ground sublease with a California municipality that expires in December 2041. As of March 31, 2026, these two ground leases had a net cost basis of approximately $603,000 and are included in Lease intangibles, net on the accompanying Condensed Consolidated Balance Sheets.

(5)Includes 48,309 acre-feet of water stored with Semitropic Water Storage District, located in Kern County, California; 7,264 surplus water credits in certain of our accounts with Westlands Water District, located in Fresno County, California; and 76 acre-feet of water stored with Belridge Water Storage District, located in Kern County, California. See Note 5, “Investments in Water Assets,” for additional information.

(6)Includes two farms consisting of 1,368 total acres and 1,221 farm acres in which we own leasehold interests via two ground leases with the State of Arizona that expire in February 2032 and February 2035, respectively. As of March 31, 2026, the aggregate net cost basis of these ground leases was zero.

(7)Includes ownership in a special-purpose LLC that owns certain irrigation infrastructure that provides water to two of our farms. As of March 31, 2026, this investment had a net carrying value of approximately $4.8 million and is included within Other assets, net on the accompanying Condensed Consolidated Balance Sheets.

Real Estate

The following table sets forth the components of our investments in tangible real estate assets as of March 31, 2026, and December 31, 2025 (dollars in thousands):


	March 31, 2026		December 31, 2025
Real estate:
Land and land improvements	$	716,878	$	717,407
Permanent plantings	345,021		345,508
Irrigation and drainage systems	170,035		170,294
Farm-related facilities	48,997		48,789
Other site improvements	15,044		15,015
Real estate, at cost	1,295,975		1,297,013
Accumulated depreciation	(208,264)		(198,261)
Total real estate, net	$	1,087,711	$	1,098,752

Real estate depreciation expense on these tangible assets was approximately $10.3 million and $8.3 million for the three months ended March 31, 2026, and 2025, respectively.

Intangible Assets and Liabilities

The following table summarizes the carrying values of certain lease intangible assets and the related accumulated amortization as of March 31, 2026, and December 31, 2025 (dollars in thousands):


	March 31, 2026		December 31, 2025
Lease intangibles:
Leasehold interest – land	$	797	$	797
In-place lease values	1,744		1,744
Leasing costs	2,139		2,139
Other(1)	117		117
Lease intangibles, at cost	4,797		4,797
Accumulated amortization	(1,765)		(1,668)
Lease intangibles, net	$	3,032	$	3,129

(1)Other includes tenant relationships and acquisition-related costs allocated to miscellaneous lease intangibles.

Total amortization expense related to these lease intangible assets was approximately $97,000 and $148,000 for the three months ended March 31, 2026, and 2025, respectively.

The following table summarizes the carrying values of certain lease intangible assets or liabilities (excluding those related to real estate held for sale) included in Other assets, net or Other liabilities, net, respectively, on the accompanying Condensed Consolidated Balance Sheets and the related accumulated amortization or accretion, respectively, as of March 31, 2026, and December 31, 2025 (dollars in thousands):


	March 31, 2026				December 31, 2025
Intangible Asset or Liability	Deferred Rent Asset (Liability)		Accumulated (Amortization) Accretion		Deferred Rent Asset (Liability)		Accumulated (Amortization) Accretion
Above-market lease values(1)	$	695	$	(275)	$	695	$	(274)
Below-market lease values(2)	(1,371)		731		(1,371)		697
Lease incentives and other deferred revenue, net(3)	13,529		(3,018)		13,365		(1,012)
	$	12,853	$	(2,562)	$	12,689	$	(589)

(1)Included as part of Other assets, net on the accompanying Condensed Consolidated Balance Sheets, and the related amortization is recorded as a reduction of Lease revenue, net on the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income.

(2)Included as a part of Other liabilities, net on the accompanying Condensed Consolidated Balance Sheets, and the related accretion is recorded as an increase to Lease revenue, net on the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income.

(3)Lease incentives are included as part of Other assets, net on the accompanying Condensed Consolidated Balance Sheets, and the related amortization is recorded as a reduction of Lease revenue, net on the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income. Other deferred revenue is primarily attributable to tenant-funded improvements and is included as a part of Other liabilities, net on the accompanying Condensed Consolidated Balance Sheets, and the related accretion is recorded as an increase to Lease revenue, net on the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income.

For the three months ended March 31, 2026 and 2025, total amortization related to above-market lease values was approximately $1,000 and $19,000, respectively; total accretion related to below-market lease values was approximately $34,000 in each period; and total net amortization related to lease incentives and other deferred revenue, net was approximately $2.0 million and $3.3 million, respectively.

Acquisitions

We did not acquire any new farms during either of the three months ended March 31, 2026 or 2025.

Property Sales

2026 Property Sales

We did not complete any farm sales during the three months ended March 31, 2026.

2025 Property Sales

In January 2025, we completed the sale of five farms in Florida totaling 5,630 gross acres for an aggregate sales price of approximately $52.5 million. Including closing costs, we recognized a net gain on the sale of approximately $14.1 million.

In February 2025, we completed the sale of two farms in Nebraska totaling 2,559 gross acres for an aggregate sales price of $12.0 million. Including closing costs, we recognized an aggregate net gain on these sales of approximately $1.6 million.

Investments in Unconsolidated Entities

In connection with the acquisition of certain farmland located in Fresno County, California, we also acquired partial ownership of a related limited liability company (the “Fresno LLC”), the sole purpose of which is to own and maintain a pipeline conveying water to our and other neighboring properties. In addition, in connection with the acquisition of certain farmland located in Umatilla County, Oregon, we also acquired partial ownership of a related limited liability company (the “Umatilla LLC”), the sole purpose of which is to own and maintain an irrigation system providing water to our and other neighboring properties.

As of March 31, 2026, our aggregate ownership interest in the Fresno LLC and the Umatilla LLC was 50.0% and 20.5%, respectively. As our investments in the Fresno LLC and Umatilla LLC are both deemed to constitute “significant influence,” we have accounted for these investments under the equity method.

During the three months ended March 31, 2026 and 2025, we recorded an aggregate loss of approximately $191,000 and $136,000, respectively (included in Loss from investments in unconsolidated entities on our Condensed Consolidated Statements of Operations and Comprehensive Income), which represents our pro-rata share of the aggregate loss recognized by the Fresno LLC and Umatilla LLC. As of March 31, 2026, and December 31, 2025, our combined ownership interest in the Fresno LLC and the Umatilla LLC had an aggregate carrying value of approximately $5.6 million and $5.7 million, respectively, and is included within Other assets, net on the accompanying Condensed Consolidated Balance Sheets.

Portfolio Concentrations

Credit Risk

As of March 31, 2026, our farms were leased to various different, unrelated third-party tenants, with certain tenants leasing more than one farm. One unrelated third-party tenant (“Tenant A”) leases seven of our farms under leases expiring in 2027, and another third-party tenant (“Tenant B”) leases six of our farms under leases expiring in 2030 or later. During the three months ended March 31, 2026, aggregate lease revenue attributable to Tenant A and Tenant B accounted for approximately $2.2 million (14.8%) and $1.9 million (12.7%), respectively, of our total lease revenue. If either Tenant A or Tenant B fails to make rental payments or elects to terminate their leases prior to their expirations (and we cannot re-lease the farms on satisfactory terms), there could be a material adverse effect on our financial performance. No other individual tenant represented greater than 10% of the total lease revenue recorded during the three months ended March 31, 2026.

Geographic Risk

Farms located in California and Florida accounted for approximately $12.1 million (81.9%) and $2.4 million (16.0%), respectively, of the total lease revenue recorded during the three months ended March 31, 2026. We seek to continue to further diversify geographically, as may be desirable or feasible. If an unexpected natural disaster (such as an earthquake, wildfire, flood, or hurricane) occurs or climate change impacts the regions where our properties are located, there could be a material adverse effect on our financial performance and ability to continue our operations. To date, none of our farms have been materially impacted by natural disasters. See “—Southeastern U.S. Hurricanes” below for a discussion of damage to certain farms caused by the hurricanes that occurred in the Southeastern U.S. in September and October 2024. Besides California and Florida, no other single state accounted for more than 10.0% of the total lease revenue recorded during the three months ended March 31, 2026.

Southeastern U.S. Hurricanes

In September and October 2024, Hurricanes Helene and Milton caused widespread destruction across many states in the Southeastern U.S., including areas where several of our farms are located.

As a result of Hurricane Helene in September 2024, one of our farms in Georgia suffered damage to certain permanent plantings on the farm. At the time, we estimated the carrying value of such plantings to be approximately $275,000, and during the three months ended September 30, 2024, we wrote down the carrying value of these plantings and also recorded a corresponding property and casualty loss. During the three months ended March 31, 2025, after further inspection of the property, it was determined that the damage was not as extensive as originally estimated, and we recorded an adjustment to our original estimate, which is included within Property and casualty (loss) recovery, net on our Condensed Consolidated Statements of Operations and Comprehensive Income. Certain of our other farms in the region suffered minor damage as a result of Hurricanes Helene and Milton, but none of our other farms were materially impacted.

Impairment

We evaluate our entire portfolio each quarter for any indicators of impairment and perform an impairment analysis on those properties that have an indication of impairment. If this analysis indicates that the carrying value may not be recoverable, an

impairment loss is recorded in earnings equal to the amount by which the carrying value exceeds the fair value of the asset. During the three months ended March 31, 2026, we recognized an impairment charge of approximately $0.9 million on one property (consisting of two farms) in St. Lucie County, Florida, to reduce the carrying value of the property to the agreed-upon purchase price pursuant to the related purchase and sale agreement. We did not record an impairment charge during the three months ended March 31, 2025.

INVESTMENTS IN WATER ASSETS

The following table sets forth the components of our investments in water assets as of March 31, 2026, and December 31, 2025 (dollars in thousands; see the description that follows for certain defined terms and additional information on each component):


	As of March 31, 2026			As of December 31, 2025
	Acre-feet	Cost Basis		Acre-feet	Cost Basis
SWSD banked water	48,309	$	35,537	48,309	$	35,537
WWD groundwater credits – 50/50 Program	2,660	746		2,660	746
WWD groundwater credits – Other agreements	4,604	892		4,563	884
BWSD banked water	76	15		—	—
Long-term water assets	55,649	37,190		55,532	37,167
Deferred water assets(1)	(1)	4,507		(1)	4,382
Investments in water assets(2)	55,649	$	41,697	55,532	$	41,549

(1)The amount of water credits to be granted under these agreements is not yet known; see “—Deferred Water Assets” below for additional information.

(2)As shown on the accompanying Condensed Consolidated Balance Sheets.

SWSD Banked Water

In connection with the acquisition of certain farmland located in Kern County, California, in 2021, we also acquired three contracts providing the right to purchase an aggregate of 45,000 acre-feet of banked water held by Semitropic Water Storage District (“SWSD”), a water storage district located in Kern County, California, at a fixed price. At the time of acquisition, we allocated approximately $31.3 million of aggregate value to these contracts. Subsequently in 2021, we executed all three

contracts and purchased the full 45,000 acre-feet of banked water for an additional aggregate cost of approximately $2.8 million.

Since the initial acquisition, additional contracts to purchase banked water held by SWSD were conveyed to us by one of our tenants as partial consideration for rent payments owed. The following table summarizes the total acre-feet of banked water obtained through the exercise of these contracts (dollars in thousands):


Period Acquired	Acre-feet of Banked Water Available to Purchase per Contract	Acre-feet of Banked Water Purchased(1)	Value Attributed to Contract(2)		Cost to Exercise Contract		Total Carrying Value of Banked Water Purchased
Fourth quarter of 2023	1,003	1,003	$	401	$	62	$	463
First quarter of 2024	2,306	2,306	923		141		1,064
Total	3,309	3,309	$	1,324	$	203	$	1,527

(1)All contracts to purchase additional banked water were exercised in the same quarter in which the respective contract was conveyed to us.

(2)Represents noncash income received during the respective periods. The straight-line impact of these receipts is included within Lease revenue, net on the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income.

All banked water acquired was recognized at cost as a long-term water asset, including the subsequent cost to exercise the contracts and any administrative fees necessary to transfer the water to our banked water account.

WWD Groundwater Credits

50/50 Program

From May 2023 through March 2024, we participated in a groundwater recharge program established by Westlands Water District (“WWD”), a water district located in Fresno County, California (the “50/50 Program”). Under the program, WWD funded the delivery of surplus surface water to properties owned by participating landowners with district-approved groundwater recharge facilities (also known as “water banks”). Participating landowners were entitled to retain 50% of the net groundwater credits generated from recharge activities under the program (after accounting for required leave-behind volumes and evaporative losses), with the remaining 50% retained by WWD for aquifer recharge.

WWD terminated the program for the 2024 water year effective March 5, 2024, and has not renewed it. As a result of the 50/50 Program, we recognized 2,660 acre-feet of water credits as a long-term water asset, representing 50% of the total net water credits generated and confirmed by WWD under the program.

Other Agreements

Since 2023, we have entered into various agreements with third parties, including local water districts and private parties, to (i) purchase water directly, (ii) acquire portions of other water districts’ surface water allocations in future years in which allocations are granted, or (iii) store surface water on behalf of others in our groundwater recharge facilities in exchange for a portion of the net groundwater credits generated and recognized by the respective water district.

To date, water delivered under these agreements have been stored in our water bank located within the WWD service area, and the resulting water credits have been recognized as a long-term water asset at cost. During the three months ended March 31, 2026 and 2025, we recognized revenue of approximately $8,000 and $0, respectively, included within Other operating revenue on our Condensed Consolidated Statements of Operations and Comprehensive Income. These amounts represent the estimated fair value of water credits received in exchange for storing water on behalf of third parties during the respective periods.

BWSD Banked Water

During the three months ended March 31, 2026, we entered into an agreement to purchase 76 acre-feet of banked water held by Belridge Water Storage District (“BWSD”), a water storage district located in Kern County, California, for approximately $15,000. This banked water was recognized at cost as a long-term water asset.

Deferred Water Assets

We have also invested in certain other programs and agreements that are expected to result in additional groundwater credits in the future; however, the amount and timing of any such credits are currently unknown and are dependent upon, and subject to, recognition by the applicable water districts in their sole discretion. The related costs are recorded in a deferred asset account (included within Investments in water assets on our Condensed Consolidated Balance Sheets) until the related net water credits become estimable and are recognized by the applicable water district, at which time such costs will be reclassified as long-term water assets (also within Investments in water assets on our Condensed Consolidated Balance Sheets).

Impairment

We evaluate our entire portfolio of water assets each quarter for any impairment indicators and perform an impairment analysis on those select water assets that have an indication of impairment. If this analysis indicates that the carrying value may not be recoverable, an impairment loss is recorded in earnings equal to the amount by which the carrying value exceeds the fair value of the asset. As of March 31, 2026, and December 31, 2025, we concluded that no water assets were impaired.