Lease evidence room · frozen packet November 2021 · teaching case

Halfmoon (Albany), NY: UPS lease, read line by line

Filing summary. Not the executed lease.

Tenant United Parcel Service, Inc. · 75,000 square feet, industrial · lease effective 2020-11-01, expires 2031-03-31 · sources M1 Form 10-K filed 2021-11-12, M2 ILPT presentation 2021-11-05. Historical teaching case, not investment or legal advice. No buy or pass call.

§1 Conclusion first

  1. 11 of 12 months are fixed by filed language. Their contractual scheduled base rent totals $272,333.33. That is a schedule, not cash: receipts are unknown for all twelve months.
  2. June 2021 stays open. The parking increment started 2021-06-04 and the filing does not say how June was invoiced. If June was billed wholly at one filed rate, it falls between $42,500.00 and $46,833.33, so the twelve-month schedule is $314,833.33 to $319,166.67. No proration is invented.
  3. Five free months, then $510,000 a year. Free rent ran 2020-11-01 to 2021-03-31; base rent commenced 2021-04-01, which matches the filed five-month count.
  4. Parking: about $52,000 of added annual rent on about $835,000 of capital, a gross ratio of 6.23%. Not NOI.
  5. Four different "annual rent" figures are not interchangeable: schedule annualized $595,000, stated straight-line $541,000, current base about $562,000, remaining-term annualized about $622,000.
  6. Financing: $4.0B of committed bridge capacity; funded balance and coupon are unknown. A hypothetical +100 bp move costs $10,000 a year per $1,000,000 of principal you choose to assume drawn.
  7. No property NOI, Halfmoon value or acquisition value can be proved from this packet.

§2 Scheduled base rent, month by month

Scheduled contractual base rent per month, November 2020 to October 2021, US dollars Line chart of scheduled monthly base rent from the filed lease summary. June 2021 is left unfilled because the filing does not fix it. Every value is labeled directly and repeated in the table below. $0 $25,000 $50,000 June unresolved Free rent, $0.00 a month $42,500.00 about $46,833.33 Nov 2020 Dec Jan 2021 Feb Mar Apr May Jun Jul Aug Sep Oct
One unit: US dollars of contractual scheduled base rent per month, zero baseline. Hatched column: June 2021, unresolved, with the two filed-rate bounds as hollow marks. Not cash received. Source M1, Form 10-K published 2021-11-12, as of 2021-09-30; read 2026-10-14 from the local packet.

§3 Rent schedule audit table

Every row is contractual scheduled rent derived from the filed lease summary. The cash column is deliberately empty of numbers: no invoice or receipt is in the packet.

UPS at Halfmoon: November 2020 to October 2021
MonthStatusAnnual contractual base rateScheduled monthly base rentCash receivedUncertaintySource
Nov 2020Free rent (determined)$0$0.00Unknown, no receipt in packetDetermined by filed language (free months counted from 2020-11-01).M1 2021-11-12 M1 2021-11-12
Dec 2020Free rent (determined)$0$0.00Unknown, no receipt in packetDetermined by filed language (free months counted from 2020-11-01).M1 2021-11-12 M1 2021-11-12
Jan 2021Free rent (determined)$0$0.00Unknown, no receipt in packetDetermined by filed language (free months counted from 2020-11-01).M1 2021-11-12 M1 2021-11-12
Feb 2021Free rent (determined)$0$0.00Unknown, no receipt in packetDetermined by filed language (free months counted from 2020-11-01).M1 2021-11-12 M1 2021-11-12
Mar 2021Free rent (determined)$0$0.00Unknown, no receipt in packetDetermined by filed language (free months counted from 2020-11-01).M1 2021-11-12 M1 2021-11-12
Apr 2021Determined$510,000$42,500.00Unknown, no receipt in packetDetermined by filed language.M1 2021-11-12 M1 2021-11-12
May 2021Determined$510,000$42,500.00Unknown, no receipt in packetDetermined by filed language.M1 2021-11-12 M1 2021-11-12
Jun 2021UNKNOWNUnknown (null)Unknown (null)
Conditional range $42,500.00 to $46,833.33
Unknown, no receipt in packetUnknown. Intra-month invoicing convention for the parking increment is not in the filing.M1 2021-11-12 M1 2021-11-12
Jul 2021Determined at filed approximate rate$562,000$46,833.33Unknown, no receipt in packetRate fixed by filed language but stated as approximate; no escalation step can fall in this month (earliest candidate anniversary 2021-11-01).M1 2021-11-12
Aug 2021Determined at filed approximate rate$562,000$46,833.33Unknown, no receipt in packetRate fixed by filed language but stated as approximate; no escalation step can fall in this month (earliest candidate anniversary 2021-11-01).M1 2021-11-12
Sep 2021Determined at filed approximate rate$562,000$46,833.33Unknown, no receipt in packetRate fixed by filed language but stated as approximate; no escalation step can fall in this month (earliest candidate anniversary 2021-11-01).M1 2021-11-12
Oct 2021Determined at filed approximate rate$562,000$46,833.33Unknown, no receipt in packetRate fixed by filed language but stated as approximate; no escalation step can fall in this month (earliest candidate anniversary 2021-11-01).M1 2021-11-12

Hand check, known months only

5 free months x $0.00 + 2 x ($510,000 / 12) + 4 x ($562,000 / 12)

= $0.00 + $85,000.00 + $187,333.33 = $272,333.33

Adding the cent-rounded rows gives $272,333.32, a $0.01 rounding difference. The November 2020 to May 2021 part ($85,000.00) rests on rates stated without qualification; July to October ($187,333.33) uses the rate the filing calls approximate. The filed $7.50 per square foot times 75,000 square feet is $562,500, which would make July to October $187,500.00, a rounding band of $166.67. June is excluded and carried separately: $42,500.00 to $46,833.33.

Free rent valued at the initial rate is $212,500.00: a contractual concession, not a cash flow.

§4 Distinct rent measures, kept apart

Initial annual base rate

$510,000

From 2021-04-01, $6.80 per square foot. M1 2021-11-12

Current base rate after parking

about $562,000

From 2021-06-04, filed as $7.50 per square foot, though about $562,000 / 75,000 is $7.49. M1 2021-11-12

Property-schedule annualized

$595,000

As of 2021-09-30, printed rounded to the nearest $1,000. Column definition not in the excerpt; not reconciled to the others. M1 2021-11-12

Stated straight-line annual

$541,000

Original lease over its life, before parking; $7.21 per square foot. Former straight-line was $574,000 ($7.65), a $33,000 or 5.8% decrease; cash basis fell 17.0% from $8.19 per square foot. M1 2021-11-12 M1 2021-11-12

Remaining-term annualized

about $622,000

From 2021-06-04 to expiry, $8.29 per square foot. Not November 2021 cash rent. M1 2021-11-12

Escalation dates: unknown

The filing says 2.0% annual increases but not the anniversary day. Candidates 2021-11-01 and 2022-04-01 both fall after this window, so no month here is affected. Reconstructing base-rent straight-line over the 125-month term: November steps give $540,566, April steps give $536,098. The November case is consistent with the filed $541,000; consistency is not proof.

§5 Financing plan as of 2021-11-05: capacity versus rate sensitivity

Capacity and plan, from M2

Committed bridge loan facility
$4.0B capacity ceiling
Actual funded balance, November 2021
Unknown (null)
Final borrowing rate
Unknown (null)
Planned JV equity
$430M to $1.3B plan
Property-sale ceiling
up to $1.6B ceiling
MNR mortgage debt to be assumed
about $409M rate terms not in packet
Transaction value
about $4.0B, at $21.00 per MNR share
Issuer year-one cash cap rate
4.0%
Issuer GAAP cap rate
about 4.3% (0.3 percentage points above cash)
Portfolio
126 properties, about 26 million rentable square feet, 99.7% occupied

These headline amounts are approximate, overlap and depend on the JV size. They are not subtracted from one another as if they were a solved funding stack. The cap rates are the issuer's expectations for the whole acquisition, not measured Halfmoon NOI. M2 2021-11-05 M2 2021-11-05 M2 2021-11-05

Hypothetical rate sensitivity

Per $1,000,000 of principal you assume is drawn and floating for a full year. Formula: principal x (move in basis points / 100) / 100; each basis point is $0.0001 a year per dollar.

Pick a hypothetical rate move

Hypothetical +100 bp: annual interest up $10,000 per $1,000,000 of assumed drawn principal. A rate scenario, not recorded interest.

All scenarios (static, readable without scripts)
Hypothetical moveAnnual interest change
-100 bpdown $10,000 a year
-50 bpdown $5,000 a year
-25 bpdown $2,500 a year
+25 bpup $2,500 a year
+50 bpup $5,000 a year
+100 bpup $10,000 a year
+200 bpup $20,000 a year

The selector changes only this scenario. It does not change any source fact, and the packet holds no funded balance to multiply.

§6 What would make the cash and GAAP reconciliation conclusive

Lease summary disclosed in a Form 10-K (M1). Not the executed lease, not an amendment, not an invoice, not a receipt.

§7 Source ledger

M1 Monmouth FY2021 Form 10-K

Published
2021-11-12
As of
2021-09-30
Sections
Item 2 pp.21-24 property schedules footnote 9 and Completed Expansions
Link
www.sec.gov (opens original, not loaded here)
Local file
monmouth-2021.txt
Read
2026-10-14 from the frozen local packet
Facts used
15 quoted passages, each checked verbatim
Show the filing excerpt
Item 2, property schedule, pp. 21-23. The filing prints the annualized rent column rounded to the nearest $1,000; it is restated here in full US dollars: State | property | tenant | annualized rent (USD) | expiry NY | Halfmoon (Albany) | United Parcel Service, Inc. | $595,000 | 03/31/31
Item 2, footnote (9), p. 23: "We simultaneously entered into 10.4 year lease agreement with UPS which became effective 11/1/20. The new lease agreement provided for five months of free rent, after which, initial annual rent was $510,000, with 2.0% annual increases thereafter, resulting in a straight-line annualized rent of $541,000 over the life of the lease which matures 3/31/31."
Item 2, building schedule, p. 21: Halfmoon (Albany) (UPS), Industrial, 75,000 square feet.
Item 2, Completed Expansions, p. 23: "In addition, effective June 4, 2021, we completed a parking lot expansion for UPS at our property located in Halfmoon (Albany), NY for a cost of approximately $835,000, resulting in an initial increase in annual rent effective on the date of completion of approximately $52,000 from approximately $510,000, or $6.80 per square foot, to approximately $562,000, or $7.50 per square foot. Furthermore, annual rent will continue to increase each year by 2.0% resulting in an annualized rent from June 4, 2021 through the remaining term of the lease of approximately $622,000, or $8.29 per square foot."
Item 2, FY2021 New and Renewed Leases, p. 24, Halfmoon lease paragraph: "The lease agreement with UPS provides for five months of free rent, after which, on April 1, 2021, initial annual rent of $510,000, representing $6.80 per square foot, commenced, with 2.0% annual increases thereafter, resulting in a straight-line annualized rent of $541,000, representing $7.21 per square foot over the life of the lease, which expires March 31, 2031. This compares to the former U.S. GAAP straight-line rent of $574,000, representing $7.65 per square foot, and former cash rent of $8.19 per square foot, resulting in a decrease of $33,000, representing a 5.8% decrease on a U.S. GAAP straight-line basis and a decrease of 17.0% on a cash basis."
The filing does not give monthly invoices, collection receipts, the exact intra-June proration convention, the anniversary day of every future escalation, property-level operating expenses or an executed lease copy. Do not transform a rate into a proven payment. The approximately $622,000 is a described remaining-term annualized measure, not November 2021 cash rent.

M2 ILPT acquisition investor presentation

Published
2021-11-05
As of
2021-11-05
Sections
slides 2-5
Link
s22.q4cdn.com (opens original, not loaded here)
Local file
ilpt-2021.txt
Read
2026-10-14 from the frozen local packet
Facts used
10 quoted passages, each checked verbatim
Show the filing excerpt
Slide 2, notes: "references to 'annualized rental revenues' mean the annualized contractual rents, as of September 30, 2021, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions, including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants (annualized rental revenues may differ from actual historical rental revenues calculated pursuant to U.S. Generally Accepted Accounting Principles (GAAP))".
Slide 3, acquired portfolio: 126 industrial and logistics properties, approximately 26 million rentable square feet, 99.7% occupancy.
Slide 4, transaction overview: "Consideration of $21.00 per MNR common share." "Total Transaction value of ~$4.0B, inclusive of MNR contracted acquisitions / expansions and transaction expenses." "ILPT plans to finance the transaction by entering into a joint venture with one or more institutional investors for equity investments of between approximately $430M and $1.3B." "The balance of the purchase price will be financed with proceeds of new mortgage debt and the assumption of approximately $409M of existing MNR mortgage debt." "Depending on the ultimate size of the joint venture equity investments, ILPT may also use proceeds from the sale of up to $1.6B of MNR properties to finance the transaction." "To ensure ILPT can finance the closing of the transaction, ILPT has secured commitments from lenders for a $4.0B bridge loan facility."
Slide 5: "Year one cash cap rate on this acquisition is 4.0% and the GAAP cap rate is approximately 4.3%." These are ILPT expectations for the acquisition, not measured Halfmoon NOI.
The slides do not disclose an actual borrowing amount or binding bridge coupon at November 2021. Debt balances, property-disposition proceeds, cost of debt, and JV ownership cannot be solved by subtracting these approximate overlapping headline amounts. A committed bridge facility is a capacity ceiling, not funded principal. Label every interest-rate change hypothetical.