Overview of NewLake Capital Partners, Inc.

NewLake Capital Partners, Inc. (the “Company”) is an internally managed real estate investment trust (REIT) that provides real estate capital to state-licensed cannabis operators. The Company acquires properties through sale-leaseback transactions, third-party purchases, and funding for build-to-suit projects. As of June 30, 2026, the Company owned 34 properties across 12 states, consisting of 19 dispensaries and 15 cultivation facilities.

The Company operates as a traditional umbrella partnership REIT structure, where properties are owned by an operating partnership. NewLake Capital Partners, Inc. is the sole general partner of the operating partnership and owns approximately 98% of the limited partnership interests.

Financial Performance Highlights

For the three months ended June 30, 2026, the Company reported the following key financial results:

• Total revenue of $12.1 million, down from $12.9 million in the prior-year period. The decrease was primarily due to three cultivation facilities becoming available for lease following tenant departures.
• Net income attributable to common stockholders of $5.9 million, down from $7.3 million in the prior-year period.
• Funds from Operations (FFO) of $9.9 million, down from $11.4 million in the prior-year period.
• Adjusted Funds from Operations (AFFO) of $10.3 million, down from $11.5 million in the prior-year period.

For the six months ended June 30, 2026, the Company reported the following key financial results:

• Total revenue of $24.4 million, down from $26.1 million in the prior-year period.
• Net income attributable to common stockholders of $11.7 million, down from $13.6 million in the prior-year period.
• FFO of $19.6 million, down from $21.6 million in the prior-year period.
• AFFO of $20.4 million, down from $22.2 million in the prior-year period.

The decreases in revenue, net income, FFO, and AFFO were primarily due to three cultivation facilities becoming available for lease following tenant departures.

Rental Income and Tenant Performance

The Company’s rental income is primarily derived from triple-net leases, where tenants are responsible for real estate taxes, insurance, maintenance, and utilities. As of June 30, 2026, the Company had 31 leased properties across 12 tenants and three properties available for lease.

One of the Company’s tenants, The Cannabist Company, announced in March 2026 that it had entered into agreements to sell certain assets and commenced restructuring proceedings in Canada. However, during the six months ended June 30, 2026, The Cannabist Company continued to pay full rent on the four properties it leased from the Company.

The Company also modified the lease for its San Diego, California dispensary property, extending the lease term by five years and adding a new tenant, Wellgreens, which acquired the previous tenant. Additionally, the Company added new guarantors to the leases for its Sinking Springs, Pennsylvania and Sterling, Massachusetts properties.

Regulatory and Market Environment

The federal regulatory environment for cannabis continued to evolve during the period. In April 2026, the U.S. Department of Justice rescheduled medical cannabis sold under qualifying state-licensed medical marijuana programs from Schedule I to Schedule III of the Controlled Substances Act. This change allows qualifying state-licensed medical marijuana operators to operate under a federal Schedule III framework and eliminates the application of Internal Revenue Code Section 280E for these businesses, potentially improving their operating cash flows and access to capital.

However, legal challenges have been filed regarding the April 2026 order, and the ultimate impact of these developments will depend on the outcome of pending legal challenges and future federal regulatory actions.

The broader macroeconomic environment has also presented challenges, with elevated inflation, interest rates, and supply chain constraints impacting cannabis operators. These pressures have contributed to credit stress and restructuring activity across the industry.

Liquidity and Capital Resources

As of June 30, 2026, the Company had $25.8 million in cash and cash equivalents and $82.4 million available on its $90.0 million Revolving Credit Facility, subject to sufficient collateral in the borrowing base.

In August 2026, the Company amended its Revolving Credit Facility, extending the maturity date by two years to May 6, 2029 and modifying the interest rate provisions such that borrowings bear interest at a variable rate equal to the greater of the Prime Rate or 6.25%.

The Company believes its current sources of liquidity, including cash flows from operations and available borrowing capacity, will be sufficient to fund its operating activities, pay dividends, and service its debt obligations over the next 12 months. However, the Company may need to utilize additional funding sources, such as borrowings or equity issuances, to finance acquisitions and unfunded improvement allowance costs.

Dividends

During the six months ended June 30, 2026, the Company declared and paid a quarterly cash dividend of $0.43 per share of common stock, equivalent to an annualized dividend of $1.72 per share. This was consistent with the dividends paid in the prior-year period.

The Company must distribute at least 90% of its REIT taxable income annually to maintain its REIT status. The Company evaluates its ability to pay dividends each quarter based on its net taxable income and operating requirements.

Analysis and Outlook

The key factors impacting NewLake Capital Partners’ financial performance during the period were the availability of three cultivation facilities for lease following tenant departures and the ongoing regulatory and macroeconomic challenges facing the cannabis industry.

The loss of rental income from the three available cultivation facilities was the primary driver of the decreases in revenue, net income, FFO, and AFFO compared to the prior-year period. While the Company was able to re-lease one of the properties to a new tenant, Wellgreens, the other two properties remained available for lease as of June 30, 2026.

The regulatory environment for cannabis continued to evolve, with the rescheduling of medical cannabis from Schedule I to Schedule III potentially providing some relief for qualifying state-licensed operators. However, the ultimate impact remains uncertain due to pending legal challenges.

Broader macroeconomic pressures, including elevated inflation, interest rates, and supply chain constraints, have also weighed on the cannabis industry, contributing to credit stress and restructuring activity. The Company’s tenant, The Cannabist Company, announced restructuring proceedings, though it has continued to pay rent to the Company thus far.

Looking ahead, the Company’s ability to re-lease the available cultivation facilities and the ongoing regulatory and market developments in the cannabis industry will be key factors in determining the Company’s future financial performance. The Company’s conservative leverage, strong liquidity position, and proactive tenant engagement provide some insulation, but the industry’s challenges could continue to impact the Company’s results.

Overall, NewLake Capital Partners remains focused on prudent underwriting, active portfolio management, and navigating the evolving regulatory and market environment in the cannabis industry. The Company’s performance will likely be influenced by its ability to maintain high occupancy, manage tenant credit risk, and capitalize on any regulatory or market improvements that could benefit its cannabis operator tenants.