Company: GMRE
Filing Date: 2025-11-13
Form Type: 424B5
Source: 0001104659-25-110926
Chunk: 117

Company: Global Medical REIT Inc.
Filing Date: 2025-11-13
Form: 424B5
Chunk 117
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 TRS. We will not be treated as holding the assets of a TRS or as receiving any income that the TRS earns. Rather, the shares issued
by a TRS to us will be an asset in our hands, and we will treat the distributions paid to us from such TRS, if any, as income to the extent
of the TRS’s earnings and profits. This treatment may affect our compliance with the gross income and asset tests. Because we will
not include the assets and gross income of TRSs in determining our compliance with the REIT requirements, we may use such entities to
undertake activities indirectly, such as earning fee income that the REIT rules might otherwise preclude us from doing directly or through
pass-through subsidiaries. Overall, no more than 20% of the value of a REIT’s assets may consist of shares or securities of one
or more TRSs.

Several provisions of the Code regarding the arrangements
between a REIT and its TRSs ensure that a TRS will be subject to an appropriate level of U.S. federal income taxation. For example, a
TRS is limited in its ability to deduct interest payments made to its parent REIT. In addition, a REIT will be subject to a 100% penalty
tax on certain payments received from, or on certain expenses deducted by, a TRS if that IRS were to successfully assert that the economic
arrangements between the REIT and the TRS were not comparable to similar arrangements among unrelated parties. Any income earned by a
TRS that is attributable to services provided to its parent REIT, or on behalf of any of its tenants, that is less than the amount that
would have been charged based upon arm’s-length negotiations, will also be subject to a 100% penalty tax.

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A TRS may not directly or indirectly operate or
manage any health care facilities or lodging facilities or provide rights to any brand name under which any health care facility or lodging
facility is operated. A TRS is not considered to operate or manage a “qualified health care property” or “qualified
lodging facility” solely because the TRS directly or indirectly possesses a license, permit, or similar instrument enabling it to
do so.

Rent that we receive from a TRS will qualify as
“rents from real property” under two scenarios. Under the first scenario, rent we receive from a TRS will qualify as “rents
from real property” as long