NewLake Capital Partners (OTCMKTS:NLCP) reported fourth-quarter and full-year 2025 results that management said were in line with expectations despite what company leaders repeatedly described as a challenging operating and capital markets backdrop for the cannabis industry. Executives emphasized steady cash flow generation, low leverage, and continued focus on risk management and re-tenanting vacant properties.
Full-year results and dividend coverage
Chairman Gordon DuGan said the company generated $51 million of revenue and $44 million of adjusted funds from operations (AFFO) in 2025, and returned $1.72 per share in dividends from $2.09 per share of AFFO. DuGan also noted that since the company’s 2021 IPO it has paid $6.86 per share in dividends.
Meyer said the company’s aggregate 2025 dividend was $1.72 per share, representing an 82% AFFO payout ratio. She added that the board declared a first-quarter 2026 cash dividend of $0.43 per share, payable April 15, 2026, to shareholders of record as of March 31, 2026.
Fourth-quarter performance and vacancies
For the fourth quarter of 2025, Meyer said total revenue was $12.3 million, down about 1.4% from the prior-year period, primarily due to vacancies at two properties previously leased to Ayr and one property previously leased to Revolutionary Clinics. Net income attributable to common stockholders was $6.0 million, or $0.29 per share, while AFFO was $10.6 million, or $0.51 per share, representing a 3% decline year over year.
The company declared a fourth-quarter dividend of $0.43 per share on December 15, 2025, paid January 15, 2026, which Meyer said represented an 85% payout ratio based on AFFO.
During the Q&A, management addressed an analyst question on fourth-quarter rent offsets related to Ayr. Executives said the company applied the remaining Ayr security deposit of approximately $408,000—roughly a little over a month and a half of rent—to partially offset unpaid rent. Management indicated that, all else equal, the primary change affecting modeling of the first quarter would be the absence of that one-time application, while property carrying costs would continue.
Portfolio management, tenant updates, and re-tenanting efforts
President and CEO Anthony Coniglio said fourth-quarter results were in line with expectations and highlighted an 85% fourth-quarter AFFO payout ratio. He said full-year results exceeded 2024, which he characterized as notable given that competitors reported year-over-year declines in revenue and AFFO.
Coniglio said the company closed two smaller transactions with existing tenant Cresco Labs during 2025 and worked with tenants Curaleaf and C3 on initiatives intended to optimize property performance and reduce long-term portfolio risk. Discussing the previously announced C3 amendment, Coniglio reiterated that higher-than-expected construction costs reduced the attractiveness of the Hartford project, and the company worked with the tenant to improve the transaction’s risk-reward profile.
Management said the company’s top three tenants—Curaleaf, Trulieve, and Cresco—represent more than 50% of annualized base rent and each reported what management described as strong 2025 results, including positive operating cash flow. Coniglio highlighted figures reported by those tenants, including Curaleaf’s $1.3 billion in net revenue and $90 million of free cash flow, Trulieve’s $230 million of free cash flow, and Cresco’s sequential gross margin improvement to 52%, debt maturity extensions to 2030, and more than $70 million in operating cash flow.
On re-tenanting, Coniglio and DuGan said the company has seen a modest pickup in interest in its vacant properties and has activity on all three sites, but emphasized caution about the pace and certainty of executing leases. Coniglio said NewLake would not announce letters of intent and would only announce “actual lease activity.”
Management also discussed tenant developments related to The Cannabist, which Coniglio said remains in forbearance with its creditors following a debt default. In the first quarter of 2026, Coniglio said The Cannabist sold its San Diego operations where NewLake leases a dispensary, and the new operator, Walgreens, assumed control of the location. Management said it completed a lease amendment in connection with the transition, did not adjust rent, and secured a five-year lease extension, pushing the lease term from roughly six years remaining to about 11 years. Coniglio said the change reduced NewLake’s exposure to The Cannabist from 9% to 8% of annualized base rent.
When asked about other Cannabist and Acreage locations, Coniglio said that, to the company’s knowledge, the properties were operational and that all tenants were in compliance with their leases. DuGan added that management was closely monitoring Cannabist given its senior debt forbearance.
Policy and industry backdrop
Executives repeatedly pointed to federal policy as a key swing factor for the industry. DuGan said the quarter’s most notable policy development was President Trump’s executive order directing the Attorney General to accelerate the process of rescheduling cannabis from Schedule I to Schedule III, which he said would require follow-through from the Department of Justice. DuGan and Coniglio both said rescheduling would be important for eliminating the Section 280E tax regime and could support improved access to capital for operators.
Coniglio also cited a continuing resolution signed after the company’s prior earnings call that he said closed the hemp loophole from the 2018 Farm Bill, which had enabled a nationwide market for intoxicating hemp-derived THC products outside state-regulated systems. If implemented as scheduled on November 12, he said the ban on hemp-derived THC could help stabilize pricing and support operator revenue growth in the second half of 2026 and into 2027. Management stressed, however, that it was not adjusting underwriting or capital allocation based on anticipated policy outcomes.
Balance sheet and liquidity
Meyer said NewLake ended 2025 with $433 million in gross real estate assets and $7.6 million of outstanding debt. She reported leverage of 1.6% debt to total gross assets and a debt service coverage ratio of approximately 78 times, with no debt maturities until May 2027. Liquidity totaled $106.3 million, including $23.9 million in cash and $82.4 million of unused capacity under its revolving credit facility.
DuGan said the company entered 2026 with more cash than debt, no preferred stock, and what he described as among the lowest leverage ratios in the REIT sector, while reiterating that NewLake would maintain a disciplined origination pace until industry reforms materialize.
About NewLake Capital Partners (OTCMKTS:NLCP)
NewLake Capital Partners, Inc is a publicly traded real estate investment trust that focuses on the acquisition, development and operation of self-storage properties across the United States. Established in the mid-2010s, the company seeks to generate stable, long-term cash flows through a portfolio of facilities that serve both individual and commercial customers. By structuring investments through its operating partnership, NewLake delivers a REIT structure to investors while maintaining operational flexibility on the ground.
The company’s core activities include identifying value-add or newly developed self-storage facilities in growth-oriented markets, negotiating acquisitions or ground leases, and overseeing construction or renovation.
