Results are in for Gladstone 4Q Report

""Gladstone Commercial"":http://gladstonecommercial.investorroom.com/ finishes 2010 with a fourth-quarter funds from operations (FFO)FO of 3.0 million, a 10.1 percent decrease compared to the same period in 2009.

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The downward movement is attributed to $386,000 in due diligence fees incurred in acquiring a $12.3 million property in Orange City, Iowa, which the Company was required to expense under new accounting guidance rather than capitalize as it had in years past.

Commenting on the results of operations, Chip Stelljes, President and Chief Investment Officer, said, ""During the quarter, we focused on managing and expanding the portfolio.

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As previously announced, we were excited to acquire a property during the last quarter, and we continue to actively search for additional properties. We remain optimistic about our future and continue to see signs of economic improvement and stabilization in both the equity and debt capital markets.""

Decreasing rental revenues as a result of the mid-year expiration of leases on two properties and the lost interest income from the payoff of the company's only mortgage loan in July also played a role in the loss. The 4Q pressure was at a premium thanks to an increase in professional fees associated with the termination of their continuous private offering of unregistered senior common stock, a negative catalyst that was partially offset by a $225,000 credit to the base management fee issued by Gladstone's adviser.
Other problems contributing to Gladstone's lagging 4Q include a significantly decreased interest expense for the quarter because of the 2 percent-plus interest rate reduction in connection with the extension of September's $48.0 million mortgage loan.

On a positive note, Gladstone will ends the year with a total FFO of 14.1 million, a 4.1 percent increase from 2009. The increase is primarily attributable to $3.3 million of additional income and prepayment fees the company received in connection with the early repayment of its mortgage loan receivable.