Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): August 8, 2023

POSTAL REALTY TRUST, INC.

(Exact name of registrant as specified in its charter)

Maryland

001-38903

83-2586114

(State or other jurisdiction of Incorporation or organization)

Commission File Number

(I.R.S. Employer Identification No.)

75 Columbia Avenue

Cedarhurst, NY 11516

(Address of principal executive offices and zip code)

(516) 295-7820

(Registrant’s telephone number)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):


☐			Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐			Soliciting material pursuant to Rule 14a-I2 under the Exchange Act (17 CFR 240.14a-12)
☐			Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.I4d-2(b))
☐			Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Class A Common Stock, par value $0.01 per share

PSTL

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01. Entry into a Material Definitive Agreement.

On August 8, 2023, Postal Realty Trust, Inc. (the “Company”) and Postal Realty LP entered into an amendment (the "Amendment") to the separate open market sale agreements, dated November 4, 2022 (as amended, the “Sale Agreements”), with each of Jefferies LLC (“Jefferies”), BMO Capital Markets Corp. (“BMO”), Janney Montgomery Scott LLC, Stifel, Nicolaus & Company, Incorporated and Truist Securities, Inc. (“Truist”), as sales agents, each of Jefferies, Bank of Montreal and Truist Bank, as forward purchasers, and Jefferies, BMO and Truist, as forward sellers, providing for the offer and sale of shares of the Company’s Class A common stock, par value $0.01 per share (the “Shares”), from time to time in “at the market” offerings. The Amendment increases the aggregate offering amount under the Sale Agreements from up to $50,000,000 to up to $150,000,000.

The foregoing summary of the terms of the Amendment and the Sale Agreements are only brief descriptions of certain terms therein and do not purport to be complete descriptions of the rights and obligations of the parties thereunder. Forms of the Amendment are attached hereto as Exhibit 1.1 and Exhibit 1.2 to this Current Report on Form 8-K and are incorporated herein by reference into this Item 1.01. The legal opinion of Venable LLP relating to the legality of the issuance and sale of the additional Shares pursuant to the Amendment is attached as Exhibit 5.1 to this Current Report on Form 8-K.

Item 2.02. Results of Operations and Financial Condition.

The Company issued a press release on August 8, 2023 announcing its financial results for the quarter ended June 30, 2023. A copy of the press release is furnished herewith and attached hereto as Exhibit 99.1. The information in this Item 2.02 and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section and shall not be deemed incorporated by reference in any filing made by the Company under the Securities Act of 1933, as amended, or the Exchange Act except as set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.


			(d)			Exhibits.


Exhibit No.						Document
1.1						Form of Amendment to the Open Market Sale Agreemen t (Forward).
1.2						Form of Amendment to the Open Market Sale Agreement (Non-Forward).
5.1						Opinion of Venable LLP as to the validity of the s hares.
23.1						Consent of Venable LLP (included in Exhibit 5.1).
99.1						Press Release of Postal Realty Trust, Inc., dated August 8, 2023.
104						Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: August 8, 2023


			POSTAL REALTY TRUST, INC.

			By:			/s/ Jeremy Garber
						Name: Jeremy Garber
						Title: President, Treasurer and Secretary

Exhibit 1.1

OPEN MARKET SALE AGREEMENT

August 8, 2023

Reference is made to that certain Open Market Sale Agreement (the “Agreement”), dated as of November 4, 2022, by and between Postal Realty Trust, Inc. (the “Company”), Postal Realty LP (the “Operating Partnership”) and [BANK] (the “Sales Agent”). Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Agreement.

RECITALS

A. Pursuant to Section 8(i) of the Agreement, the Agreement may be amended by an agreement in writing signed by the Company, the Operating Partnership and the Sales Agent.

B. Each of the Company, the Operating Partnership and the Sales Agent desire to amend the Agreement through this Amendment with effect on and after the date hereof (the “Effective Date”).

AGREEMENT

SECTION 1. Amendment to the Agreement. The parties agree, from and after the Effective Date, that:

(a) Clause [(ii)/(iii)] of the first paragraph of the Agreement shall be amended and restated in its entirety as follows to increase the aggregate offering price to $150,000,000:

sales agent and/or principal (the “Agent”), shares of the Company’s Class A common stock, par value $0.01 per share (the “Common Shares”), having an aggregate offering price of up to $150,000,000 on the terms set forth in this agreement and the Master Forward Confirmation (defined below) (together, this “Agreement”). The Forward Seller shall be acting as sales agent for the Forward Purchaser and agrees with the Company and the Forward Purchaser to use commercially reasonable efforts consistent with its normal trading and sales practices to sell the Forward Hedge Shares upon the terms and subject to the conditions set forth in this Agreement.

and

(b) Section 4(q) of the Agreement shall be amended and restated in its entirety as follows:

Comfort Letter. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date with respect to which the Company is obligated to deliver a certificate pursuant to Section 4(o) for which no waiver is applicable and excluding the date of this Agreement, the Company (a) shall cause each of BDO USA LLP and Deloitte & Touche LLP, the independent registered public accounting firms who have audited certain financial statements included or incorporated by reference in the Registration Statement to furnish the Agent, the Forward Seller and the Forward Purchaser a comfort letter, dated the date of delivery, in form and substance reasonably satisfactory to the Agent, the Forward Seller and the Forward Purchaser and their counsel, substantially similar to the form previously provided to the Agent, the Forward Seller and the Forward Purchaser and their counsel; provided, however, that any such comfort letter will only be

required on the Triggering Event Date specified to the extent that it contains financial statements filed with the Commission under the Exchange Act and incorporated or deemed to be incorporated by reference into a Prospectus and (b) shall cause any accounting firm that has audited any financial statements with respect to real estate operations acquired or to be acquired prepared in accordance with Rule 3-14 of Regulation S-X (“3-14 Financial Statements”) included, or incorporated by reference in, the Registration Statement and the Prospectus, to furnish the Agent, the Forward Seller and the Forward Purchaser (a “3-14 Comfort Letter”), dated the date of delivery, in form and substance reasonably satisfactory to the Agent, the Forward Seller and the Forward Purchaser and their counsel, substantially similar to the form previously provided to the Agent, the Forward Seller and the Forward Purchaser and their counsel; provided, however, that no such 3-14 Comfort Letter shall be required to be delivered with respect to any 3-14 Financial Statements prepared for the Company’s acquired real estate operations that have been consolidated by the Company for all of the years for which audited financial statements are included in the Company’s most recent annual report on Form 10-K. If requested by the Agent, the Forward Seller or the Forward Purchaser, the Company shall also cause a comfort letter to be furnished to the Agent, the Forward Seller and the Forward Purchaser on or prior to the date of occurrence of any material transaction or event requiring the filing of a current report on Form 8-K containing material amended financial information of the Company, including the restatement of the Company’s financial statements.

POSTAL REALTY TRUST, INC.

By:

Name:

Title:

POSTAL REALTY LP

By:

Name:

Title:

[BANK]

By:

Name:

Title:

Exhibit 1.2

OPEN MARKET SALE AGREEMENT

August 8, 2023

RECITALS

A. Pursuant to Section 8(i) of the Agreement, the Agreement may be amended by an agreement in writing signed by the Company, the Operating Partnership and the Sales Agent.

B. Each of the Company, the Operating Partnership and the Sales Agent desire to amend the Agreement through this Amendment with effect on and after the date hereof (the “Effective Date”).

AGREEMENT

SECTION 1. Amendment to the Agreement. The parties agree, from and after the Effective Date, that:

(a) The first paragraph of the Agreement shall be amended and restated in its entirety as follows to increase the aggregate offering price to $150,000,000:

Postal Realty Trust, Inc., a Maryland corporation (the “Company”), and Postal Realty LP, a Delaware limited partnership (the “Operating Partnership” and, together with the Company, the “Transaction Entities”), propose, subject to the terms and conditions stated herein, to issue and sell from time to time through [BANK], as sales agent and/or principal (the “Agent”), shares of the Company’s Class A common stock, par value $0.01 per share (the “Common Shares”), having an aggregate offering price of up to $150,000,000 on the terms set forth in this agreement and the Master Forward Confirmation (defined below) (together, this “Agreement”).

and

(b) Section 4(q) of the Agreement shall be amended and restated in its entirety as follows:

POSTAL REALTY TRUST, INC.

By:

Name:

Title:

POSTAL REALTY LP

By:

Name:

Title:

[BANK]

By:

Name:

Title:


750 E. PRATT STREET SUITE 900 BALTIMORE, MD 21202 T 410.244.7400 F 410.244.7742 www.Venable.com

Exhibit 5.1

August 8, 2023

Postal Realty Trust, Inc.

75 Columbia Avenue

Cedarhurst, NY 11516

Re: Registration Statement on Form S-3

Ladies and Gentlemen:

We have served as Maryland counsel to Postal Realty Trust, Inc., a Maryland corporation (the “Company”), in connection with certain matters of Maryland law relating to the registration by the Company of shares (the “Shares”) of Class A common stock, $0.01 par value per share (the “Common Stock”), of the Company having a maximum aggregate offering price of up to $150,000,000, which may be sold from time to time pursuant to Open Market Sale Agreements, dated November 4, 2022, as amended by those certain Amendments No. 2 to the Open Market Sale Agreements, dated August 8, 2023 (the “Sale Agreements”), each by and among the Company, Postal Realty LP, a Delaware limited partnership, and each of Jefferies LLC (“Jefferies”), Stifel, Nicolaus & Company, Incorporated, BMO Capital Markets Corp. (“BMO”), Janney Montgomery Scott LLC and Truist Securities, Inc. (“Truist”), as sales agents (each, a “sales agent” and, collectively, the “sales agents”), each of Jefferies, Bank of Montreal and Truist Bank, as forward purchasers (each, a “forward purchaser” and, collectively, the “forward purchasers”), and each of Jefferies, BMO and Truist, as forward sellers (each, in its capacity as agent for its affiliated forward purchaser, a “forward seller” and, collectively, the “forward sellers”), relating to the offer and sale of the Shares. This firm did not participate in the drafting or negotiation of the Sale Agreements or the Forward Confirmation (as defined below).

In connection with our representation of the Company, and as a basis for the opinion hereinafter set forth, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the following documents (hereinafter collectively referred to as the “Documents”):

1.The Registration Statement on Form S-3 (File No. 333-251079), and all amendments thereto (the “Registration Statement”) and the related form of prospectus included therein and all supplements thereto, substantially in the form in which it was transmitted to the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Securities Act”);

2.The Prospectus Supplement, dated August 8, 2023, substantially in the form to be filed with the Commission under the Securities Act;

3.The charter of the Company (the “Charter”), certified by the State Department of Assessments and Taxation of Maryland (the “SDAT”);

4.The Amended and Restated Bylaws of the Company, certified as of the date hereof by an officer of the Company;

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Postal Realty Trust, Inc.

August 8, 2023

Page 2

5.A certificate of the SDAT as to the good standing of the Company, dated as of a recent date;

6.Resolutions adopted by the Board of Directors of the Company relating to, among other matters, (a) the authorization of the execution and delivery by the Company of the Sale Agreements and any Forward Confirmation and (b) the sale and issuance of the Shares (the “Resolutions”), certified as of the date hereof by an officer of the Company;

7.The Sale Agreements;

8.The form of Master Forward Confirmation and the related Supplemental Confirmation which may be entered into by and between the Company and the applicable Forward Purchaser in relation to any forward purchase transaction (each, as defined in the applicable Sale Agreement) (the “Forward Confirmation”);

9.A certificate executed by an officer of the Company, dated as of the date hereof; and

10.Such other documents and matters as we have deemed necessary or appropriate to express the opinion set forth below, subject to the assumptions, limitations and qualifications stated herein.

In expressing the opinion set forth below, we have assumed the following:

1.Each individual executing any of the Documents, whether on behalf of such individual or another person, is legally competent to do so.

2.Each individual executing any of the Documents on behalf of a party (other than the Company) is duly authorized to do so.

3.Each of the parties (other than the Company) executing any of the Documents has duly and validly executed and delivered each of the Documents to which such party is a signatory, and such party’s obligations set forth therein are legal, valid and binding and are enforceable in accordance with all stated terms.

4.All Documents submitted to us as originals are authentic. The form and content of all Documents submitted to us as unexecuted drafts do not differ in any respect relevant to this opinion from the form and content of such Documents as executed and delivered. All Documents submitted to us as certified or photostatic copies conform to the original documents. All signatures on all Documents are genuine. All public records reviewed or relied upon by us or on our behalf are true and complete. All representations, warranties, statements and information contained in the Documents are true and complete. There has been no oral or written modification of or amendment to any of the Documents, and there has been no waiver of any provision of any of the Documents, by action or omission of the parties or otherwise.

60846170-v6

Postal Realty Trust, Inc.

August 8, 2023

Page 3

5.Upon the issuance of any Shares and any Forward Settlement Shares (as defined in the Sale Agreements), the total number of shares of Common Stock issued and outstanding will not exceed the total number of shares of Common Stock that the Company is then authorized to issue under the Charter.

6.None of the Shares or the Forward Settlement Shares will be issued, sold or transferred in violation of the restrictions on transfer and ownership contained in the Charter.

Based upon the foregoing, and subject to the assumptions, limitations and qualifications stated herein, it is our opinion that:

1.The Company is a corporation duly incorporated and existing under and by virtue of the laws of the State of Maryland and is in good standing with the SDAT.

2.The issuance of the Shares and the Forward Settlement Shares has been duly authorized and, when issued and delivered by the Company in accordance with the Resolutions, the Registration Statement, the Sales Agreement and, if applicable, any Forward Confirmation against payment of the consideration set forth therein, the Shares and the Forward Settlement Shares will be validly issued, fully paid and nonassessable.

The foregoing opinion is limited to the laws of the State of Maryland, and we do not express any opinion herein concerning any federal or other state law. We express no opinion as to the applicability or effect of federal or state securities laws, including the securities laws of the State of Maryland, or as to federal or state laws regarding fraudulent transfers. To the extent that any matter as to which our opinion is expressed herein would be governed by the laws of any jurisdiction other than the State of Maryland, we do not express any opinion on such matter. The opinion expressed herein is subject to the effect of any judicial decision which may permit the introduction of parol evidence to modify the terms or the interpretation of agreements.

The opinion expressed herein is limited to the matters specifically set forth herein and no other opinion shall be inferred beyond the matters expressly stated. We assume no obligation to supplement this opinion if any applicable law changes after the date hereof or if we become aware of any fact that might change the opinion expressed herein after the date hereof.

This opinion is being furnished to you for submission to the Commission as an exhibit to the Company’s Current Report on Form 8-K relating to the Shares (the “Current Report”), which is incorporated by reference in the Registration Statement. We hereby consent to the filing of this opinion as an exhibit to the Current Report and to the use of the name of our firm therein. In giving this consent, we do not admit that we are within the category of persons whose consent is required by Section 7 of the Securities Act.

Very truly yours,

/s/ Venable LLP

142383-518857

60846170-v6

Exhibit 99.1

POSTAL REALTY TRUST, INC. REPORTS SECOND QUARTER 2023 RESULTS

- Acquired 39 USPS Properties for $15.8 Million During the Second Quarter -

- 100% of Debt Set to Fixed Rates & No Outstanding Revolver Balance -

- Collected 100% of Contractual Rents -

Cedarhurst, New York, August 8, 2023 (GLOBE NEWSWIRE) — Postal Realty Trust, Inc. (NYSE: PSTL) (the “Company”), an internally managed real estate investment trust that owns and manages over 1,750 properties leased primarily to the United States Postal Service (the “USPS”), ranging from last-mile post offices to larger industrial facilities, today announced results for the quarter ended June 30, 2023.

Highlights for the Quarter Ended June 30, 2023

•Acquired 39 USPS properties for approximately $15.8 million, excluding closing costs

•21% growth in revenues from second quarter 2022 to second quarter 2023

•Net income attributable to common shareholders was $1.0 million, or $0.03 per diluted share

•Funds from Operations ("FFO") was $6.0 million, or $0.24 per diluted share

•Adjusted Funds from Operations ("AFFO") was $6.8 million, or $0.27 per diluted share

•Subsequent to quarter end, the Company announced a quarterly dividend of $0.2375 per share

“We are pleased with our second quarter results, and our performance in the first half of 2023 reflects the strength of our unique business anchored by solid operations and a strong credit tenant. With no near-term debt maturities and sufficient dry powder, we are well-positioned to continue to add accretive real estate to our portfolio that is important to the United States Postal Service and to support Postal Realty's future growth throughout all economic cycles", stated Andrew Spodek, Chief Executive Officer.

Property Portfolio & Acquisitions

The Company’s owned portfolio was 99.7% occupied, comprised of 1,364 properties across 49 states and one territory with approximately 5.6 million net leasable interior square feet and a weighted average rental rate of $9.11 per leasable square foot based on rents in place as of June 30, 2023. The weighted average rental rate consisted of $11.33 per leasable square foot on last-mile and flex properties, and $3.55 on industrial properties.

During the second quarter, the Company acquired 39 last-mile and flex properties leased to the USPS for approximately $15.8 million, excluding closing costs, comprising approximately 93,000 net leasable interior square feet at a weighted average rental rate of $14.18 per leasable square foot based on rents in place as of June 30, 2023.

Balance Sheet & Capital Markets Activity

As of June 30, 2023, the Company had approximately $2.8 million of cash and property-related reserves on the balance sheet, and approximately $224 million of net debt with a weighted average interest rate of 4.10%. At the end of the second quarter, 87.2% of the Company's total debt was set to fixed rates (when taking into account interest rate hedges), and $29 million was outstanding on the Company's $150 million revolving credit facility.

On July 24, 2023, the Company amended its credit facilities to, among other things, add a daily simple SOFR-based option to the term SOFR-based floating interest rate option as a benchmark rate for borrowings under the credit facilities. The Company further exercised $25.0 million of term loan accordion under the term loan maturing in January 2027 and, on a delayed-draw basis, $10.0 million of term loan accordion under the term loan maturing in February 2028. As of August 2, 2023, the $10.0 million delayed-draw portion of the term loan was not drawn by the Company. In connection with the accordion exercise, the Company also entered into an interest rate swap that effectively fixed the interest rate on the additional $25.0 million of term loan through January 2027 at a current rate of 5.736%. Following these transactions, the Company used the proceeds from the $25.0 million term loan accordion and cash to repay the outstanding balance on the revolving credit facility. As of August 2, 2023, the weighted average interest rate on the Company's debt outstanding was 3.95% and 100% of all debt was set to fixed rates.

During the second quarter and through August 2, 2023, the Company issued 780,222 shares of common stock through its at-the-market equity offering program for total gross proceeds of approximately $11.7 million at a weighted average price per share of $15.03. Additionally, the Company entered into forward sales transactions under its at-the-market equity offering program for an additional 798,847 shares of common stock totaling gross proceeds of approximately $12.0 million at a weighted average price per share of $15.02.

Dividend

On July 26, 2023, the Company declared a quarterly dividend of $0.2375 per share of Class A common stock. The dividend equates to $0.95 per share on an annualized basis. The dividend will be paid on August 31, 2023 to stockholders of record as of the close of business on August 7, 2023.

Subsequent Events

Subsequent to quarter end and through August 2, 2023, the Company acquired 11 properties comprising approximately 33,000 net leasable interior square feet for approximately $5.3 million, excluding closing costs. The Company had another 18 properties totaling approximately $4.7 million under definitive contracts.

Webcast and Conference Call Details

The Company will host a webcast and conference call to discuss the second quarter 2023 financial results on Wednesday, August 9, 2023, at 9:00 A.M. Eastern Time. A live audio webcast of the conference call will be available on the Company’s investor website at https://investor.postalrealtytrust.com/Investors/events-and-presentations/default.aspx. To participate in

the conference call, callers from the United States and Canada should dial-in ten minutes prior to the scheduled call time at 1-877-407-9208. International callers should dial 1-201-493-6784.

Replay

A telephonic replay of the call will be available starting at 1:00 P.M. Eastern Time on Wednesday, August 9, 2023, through 11:59 P.M. Eastern Time on Wednesday, August 23, 2023, by dialing 1-844-512-2921 in the United States and Canada or 1-412-317-6671 internationally. The passcode for the replay is 13734923.

Non-GAAP Supplemental Financial Information

An explanation of certain non-GAAP financial measures used in this press release, including, FFO, AFFO and net debt, as well as reconciliations of those non-GAAP financial measures, to the most directly comparable GAAP financial measure, is included below.

The Company calculates FFO in accordance with the current National Association of Real Estate Investment Trusts (“NAREIT”) definition. NAREIT currently defines FFO as follows: net income (loss) (computed in accordance with GAAP) excluding depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by an entity. Other REITs may not define FFO in accordance with the NAREIT definition or may interpret the current NAREIT definition differently than the Company does and therefore the Company’s computation of FFO may not be comparable to such other REITs.

The Company calculates AFFO by starting with FFO and adjusting for recurring capital expenditures (defined as all capital expenditures and leasing costs that are recurring in nature, excluding expenditures that (i) are for items identified or existing at the time a property was acquired or contributed (including through the Company’s formation transactions), (ii) are part of a strategic plan intended to increase the value or revenue-generating ability of a property, (iii) are considered infrequent or extraordinary in nature, or (iv) for casualty damage), acquisition-related expenses (defined as expenses that are incurred for investment purposes and business acquisitions and do not correlate with the ongoing operations of the Company’s existing portfolio, including due diligence costs for acquisitions not consummated and certain professional fees incurred that were directly related to completed acquisitions or dispositions and integration of acquired business) that are not capitalized, and certain other non-recurring expenses and then adding back non-cash items including: write-off and amortization of deferred financing fees, straight-line rent and other adjustments (including lump sum catch up payments for increased rents), fair value lease adjustments, income on insurance recoveries from casualties, non-real estate depreciation and amortization and non-cash components of compensation expense. AFFO is a non-GAAP financial measure and should not be viewed as an alternative to net income calculated in accordance with GAAP as a measurement of the Company’s operating performance. The Company believes that AFFO is widely used by other REITs and is helpful to investors as a meaningful additional measure of the Company’s ability to make capital investments. Other REITs may not define AFFO in the same manner as the

Company does and therefore the Company’s calculation of AFFO may not be comparable to such other REITs.

The Company calculates its net debt as total debt less cash and property-related reserves. Net debt as of June 30, 2023 is calculated as total debt of approximately $227 million less cash and property-related reserves of approximately $3 million.

These metrics are non-GAAP financial measures and should not be viewed as an alternative measurement of the Company’s operating performance to net income. Management believes that accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. As a result, the Company believes that the additive use of FFO and AFFO, together with the required GAAP presentation, is widely-used by the Company’s competitors and other REITs and provides a more complete understanding of the Company’s performance and a more informed and appropriate basis on which to make investment decisions.

Forward-Looking and Cautionary Statements

This press release contains “forward-looking statements.” Forward-looking statements include statements identified by words such as “could,” “may,” “might,” “will,” “likely,” “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “continues,” “projects” and similar references to future periods, or by the inclusion of forecasts or projections. Forward-looking statements, including, among others, statements regarding the Company’s anticipated growth and ability to obtain financing and close on pending transactions on the terms or timing it expects, if at all, are based on the Company’s current expectations and assumptions regarding capital market conditions, the Company’s business, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, the Company’s actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include the USPS’s terminations or non-renewals of leases, changes in demand for postal services delivered by the USPS, the solvency and financial health of the USPS, competitive, financial market and regulatory conditions, disruption in market, economic and financial conditions as a result of the COVID-19 pandemic, general real estate market conditions, the Company’s competitive environment and other factors set forth under “Risk Factors” in the Company’s filings with the Securities and Exchange Commission. Any forward-looking statement made in this press release speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

About Postal Realty Trust, Inc.

Postal Realty Trust, Inc. is an internally managed real estate investment trust that owns and manages over 1,750 properties leased primarily to the USPS. More information is available at postalrealtytrust.com.

Contact:

Investor Relations and Media Relations

Email: Investorrelations@postalrealtytrust.com

Phone: 516-232-8900

Postal Realty Trust, Inc.

Consolidated Statements of Operations

(Unaudited)

(in thousands, except per share data)


	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2023		2022		2023		2022
Revenues:
Rental income	$	14,762	$	12,135	$	29,261	$	23,484
Fee and other	695		589		1,344		1,171
Total revenues	15,457		12,724		30,605		24,655

Operating expenses:
Real estate taxes	2,029		1,705		4,012		3,295
Property operating expenses	1,414		1,230		3,038		2,760
General and administrative	3,610		3,309		7,769		6,950
Depreciation and amortization	4,781		4,219		9,618		8,329
Total operating expenses	11,834		10,463		24,437		21,334

Income from operations	3,623		2,261		6,168		3,321

Other income	125		187		239		674

Interest expense, net:
Contractual interest expense	(2,302)		(1,111)		(4,347)		(1,797)
Write-off and amortization of deferred financing fees	(165)		(155)		(330)		(284)

Interest income	1		1		1		1
Total interest expense, net	(2,466)		(1,265)		(4,676)		(2,080)

Income before income tax expense	1,282		1,183		1,731		1,915
Income tax expense	(21)		(18)		(37)		(29)

Net income	1,261		1,165		1,694		1,886
Net income attributable to Operating Partnership unitholders’ non-controlling interests	(249)		(212)		(334)		(338)

Net income attributable to common stockholders	$	1,012	$	953	$	1,360	$	1,548

Net income per share:
Basic and Diluted	$	0.03	$	0.04	$	0.04	$	0.06

Weighted average common shares outstanding:
Basic and Diluted	19,544,833		18,398,808		19,417,304		18,383,544

Postal Realty Trust, Inc.

Consolidated Balance Sheets

(Unaudited)

(In thousands, except par value and share data)


	June 30, 2023		December 31, 2022

Assets
Investments:
Real estate properties, at cost:
Land	$	96,063	$	90,020
Building and improvements	405,927		378,596
Tenant improvements	6,643		6,375
Total real estate properties, at cost	508,633		474,991
Less: Accumulated depreciation	(37,286)		(31,257)
Total real estate properties, net	471,347		443,734
Investment in financing leases, net	16,083		16,130
Total real estate investments, net	487,430		459,864
Cash	2,191		1,495
Escrow and reserves	751		547
Rent and other receivables	3,936		4,613
Prepaid expenses and other assets, net	15,225		15,968
Goodwill	1,536		1,536
Deferred rent receivable	1,356		1,194
In-place lease intangibles, net	14,340		15,687
Above market leases, net	385		399
Total Assets	$	527,150	$	501,303

Liabilities and Equity
Liabilities:
Term loans, net	$	163,887	$	163,753
Revolving credit facility	29,000		—
Secured borrowings, net	32,822		32,909
Accounts payable, accrued expenses and other, net	7,996		9,109
Below market leases, net	11,875		11,821
Total Liabilities	245,580		217,592

Commitments and Contingencies

Equity:
Class A common stock, par value $0.01 per share; 500,000,000 shares authorized; 20,002,769 and 19,528,066 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively	200		195
Class B common stock, par value $0.01 per share; 27,206 shares authorized: 27,206 shares issued and outstanding as of June 30, 2023 and December 31, 2022	—		—
Additional paid-in capital	258,331		254,107
Accumulated other comprehensive income	7,934		7,486
Accumulated deficit	(40,754)		(32,557)
Total Stockholders’ Equity	225,711		229,231
Operating Partnership unitholders’ non-controlling interests	55,859		54,480
Total Equity	281,570		283,711
Total Liabilities and Equity	$	527,150	$	501,303

Postal Realty Trust, Inc.

Reconciliation of Net Income to FFO and AFFO

(Unaudited)

(In thousands, except share data)


	For the Three Months Ended June 30, 2023
Net income	$	1,261
Depreciation and amortization of real estate assets	4,755
FFO	$	6,016
Recurring capital expenditures	(94)
Write-off and amortization of deferred financing fees	165
Straight-line rent and other adjustments	(100)
Fair value lease adjustments	(623)
Acquisition-related and other expenses	301
Income on insurance recoveries from casualties	(125)
Non-real estate depreciation and amortization	26
Non-cash components of compensation expense	1,247
AFFO	$	6,813
FFO per common share and common unit outstanding	$	0.24
AFFO per common share and common unit outstanding	$	0.27
Weighted average common shares and common units outstanding, basic and diluted	25,005,444

Cover	Aug. 08, 2023
Cover [Abstract]
Document Type	8-K
Document Period End Date	Aug. 08, 2023
Entity Registrant Name	POSTAL REALTY TRUST, INC.
Entity Incorporation, State or Country Code	MD
Entity File Number	001-38903
Entity Tax Identification Number	83-2586114
Entity Address, Address Line One	75 Columbia Avenue
Entity Address, City or Town	Cedarhurst
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	11516
City Area Code	516
Local Phone Number	295-7820
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Class A Common Stock, par value $0.01 per share
Trading Symbol	PSTL
Security Exchange Name	NYSE
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Central Index Key	0001759774
Amendment Flag	false