Global Medical REIT Shows A Slight Decrease in Revenue in Q1 2024

Photo of author
Written By Faith Boluwatife

Global Medical REIT Inc. (GMRE) has grown significantly, leveraging a low-interest-rate environment to expand its total assets at a 40% compound annual growth rate (CAGR). The company’s portfolio primarily consists of medical office buildings in secondary markets, characterized by high occupancy and strong rent coverage from the onset.

Tenant and Market Profile

Credits: DepositPhotos

GMRE’s tenant base, although in secondary markets, has remained robust. The investment thesis hinges on the defensive nature of this asset class, supported by strong demographic trends favoring sustained demand for medical office space despite the rise of telehealth during the COVID-19 pandemic.

Q1-2024 Performance

GMRE’s Q1-2024 results showed a slight decline in revenues compared to Q1-2023, primarily due to the sale of three properties and a slight decrease in occupancy levels.

The key metrics for real estate investment trusts (REITs), funds from operations (FFO), and adjusted FFO (AFFO) remained relatively flat year-over-year. The quarterly distribution of $0.21 per share appeared to be tightly covered by these earnings measures.

Growth Challenges

GMRE’s growth has stagnated since April 2022, with the stock consistently trading below its consensus net asset value (NAV). The company’s NAV has also drifted lower, complicating efforts to issue new stock for growth.

Additionally, GMRE faces significant debt repricing challenges, with $617.8 million in total debt as of March 31, 2024, carrying a weighted average interest rate of 3.85% and an average remaining term of 2.7 years. Repricing this debt at current higher interest rates would significantly impact AFFO, reducing it from $0.84 to approximately $0.70 annually.

Acquisition Strategy

To address these challenges, GMRE has pursued a more creative growth strategy. In May 2024, the company entered a purchase agreement for a 15-property portfolio of outpatient medical real estate, valued at $81.3 million. The acquisition is structured in two tranches, with the first tranche expected to close in Q3 2024 and the second one in Q4 2024. This acquisition aims to improve asset returns through capital recycling.

Market and Financial Outlook

The acquisition cap rate of approximately 8% is slightly higher than GMRE’s NAV-derived cap rate. Despite the disciplined approach of not issuing equity below NAV, these acquisitions are not expected to significantly alter GMRE’s financial position, especially if funded through asset sales.

GMRE’s stock remains modestly undervalued, trading 20% below the consensus NAV. However, growth prospects are constrained by the need to reprice debt and the broader challenges facing the commercial real estate market, including potential office space vacancies and higher cap rates.

Preferred Shares and Conclusion

Credits: DepositPhotos

GMRE’s 7.50% cumulative preferred shares (NYSE.PR.A) offer a yield of 7.61% based on the stripped price. These preferred shares are considered safer due to the substantial common equity buffer. Despite a lower yield compared to common shares, the preferred shares provide a more secure investment option.

GMRE faces significant headwinds, including debt repricing and limited growth prospects without substantial interest rate reductions. The preferred shares offer a much safer alternative to the common shares.


You should read and understand this disclaimer in its entirety before joining or viewing the website or email/blog list of (the “Publisher”). The information (collectively the “Advertisement”) disseminated by email, text or other method by the Publisher including this publication is a paid commercial advertisement and should not be relied upon for making an investment decision or any other purpose. The Publisher is engaged in the business of marketing and advertising the securities of publicly traded companies in exchange for compensation. The track record, gains, upside, and/or losses mentioned in the Advertisement, if any, should not be considered as true or accurate or be the basis for an investment. The Publisher does not verify the accuracy or completeness of any information included in the Advertisement. While the Publisher does not charge for the SMS service, standard carrier message and data rates may apply. To unsubscribe from receiving promotional text messages to your phone sent via an autodialer, using your phone reply to the sender’s phone number with the word STOP or HELP for help.

The Advertisement is not a solicitation or recommendation to buy securities of the advertised company. An offer to buy or sell securities can be made only by a disclosure document that complies with applicable securities laws and only in the states or other jurisdictions in which the security is eligible for sale. The Advertisement is not a disclosure document. The Advertisement is only a favorable snapshot of unverified information about the advertised company. An investor considering purchasing the securities, should always do so only with the assistance of his legal, tax and investment advisors. Investors should review with his or her investment advisor, tax advisor or attorney, if and to the extent available, any information concerning a potential investment at the web sites of the U.S. Securities and Exchange Commission (the "SEC") at; the Financial Industry Regulatory Authority (the "FINRA") at, and relevant State Securities Administrator website and the OTC Markets website at The Publisher cautions investors to read the SEC advisory to investors concerning Internet Stock Fraud at, as well as related information published by the FINRA on how to invest carefully. Investors are responsible for verifying all information in the Advertisement. As an advertiser, we do not verify any information we publish. The Advertisement should not be considered true or complete.

The Publisher does not offer investment advice or analysis, and the Publisher further urges you to consult your own independent tax, business, financial and investment advisors concerning any investment you make in securities particularly those quoted on the OTC Markets. Investing in securities is highly speculative and carries an extremely high degree of risk. You could lose your entire investment if you invest in any company mentioned in the Advertisement. You acknowledge that we are not an investment advisory service, a broker-dealer or an investment adviser and we are not qualified to act as such. You acknowledge that you will consult with your own independent, tax, financial and/or legal advisers regarding any decisions as to any company mentioned here. We have not determined if the Advertisement is accurate, correct or truthful. The Advertisement is compiled from publicly available information, which include, but are not limited to, no cost online research, magazines, newspapers, reports filed with the SEC or information furnished by way of press releases. Because all information relied upon by us in preparing an advertisement about an issuer comes from a public source, it is not reliable, and you should not assume it is accurate or complete.

By your subscription to our profiles, the viewing of this profile and/or use of our website, you have agreed and acknowledged the terms of our full disclaimer and privacy policy which can be viewed at the following link: and

By accepting the Advertisement, you agree and acknowledge that any hyperlinks to the website of (1) a client company, (2) the party issuing or preparing the information for the company, or (3) other information contained in the Advertisement is provided only for your reference and convenience. The advertiser is not responsible for the accuracy or reliability of these external sites, nor is it responsible for the content, opinions, products or other materials on external sites or information sources. If you use, act upon or make decisions in reliance on information contained in any disseminated report/release or any hyperlink, you do so at your own risk and agree to hold us, our officers, directors, shareholders, affiliates and agents harmless. You acknowledge that you are not relying on the Publisher, and we are not liable for, any actions taken by you based on any information contained in any disseminated email or hyperlink.