Company: GMRE
Filing Date: 2025-11-14
Form Type: 424B5
Source: 0001104659-25-112543
Chunk: 119

Company: Global Medical REIT Inc.
Filing Date: 2025-11-14
Form: 424B5
Chunk 119
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income and gross income from our sale of property that we hold primarily for sale to customers in the ordinary course of business are
excluded from both the numerator and the denominator in both gross income tests. In addition, income and gain from “hedging transactions”
that we enter into to hedge indebtedness incurred or to be incurred to acquire or carry real estate assets and that are clearly and timely
identified as such will be excluded from both the numerator and the denominator for purposes of the 75% and 95% gross income tests. See
“—Hedging Transactions.” In addition, certain foreign currency gains will be excluded from gross income for purposes
of one or both of the gross income tests. See “—Foreign Currency Gain.” The following paragraphs discuss the specific
application of the gross income tests to us.

Rents from Real Property. “Rents
from real property” is qualifying income for both 75% and 95% gross income tests. Our leases generally are on a “triple-net”
basis, requiring the tenant-operators to pay substantially all expenses associated with the operation of the healthcare facilities, such
as real estate taxes, insurance, utilities, services, maintenance and other operating expenses and any ground lease payments. Rents under
our leases will constitute “rents from real property” only if the leases are treated as “true leases” for U.S.
federal income tax purposes and are not treated as service contracts, joint ventures, financing arrangements or some other type of arrangement.
The determination of whether a lease is a true lease depends on an analysis of all surrounding facts and circumstances. In making such
a determination, courts have considered a variety of factors, including the following:

| · | the intent of the parties; |

| · | the form of the agreement; |

| · | the degree of control over the property that is retained by the property owner (e.g., whether the tenant has substantial control over            
 the operation of the property or whether the tenant was required simply to use its best efforts to perform its obligations under the agreement); |

| · | the extent to which the property owner retains the risk of loss with respect to the operation of the property (e.g., whether the tenant 
 bears the risk of increases in operating expenses or the risk of damage to the property); and                                           |

| · | the extent to which the property owner retains the burdens and benefits of ownership of the property. |

We believe that each of our leases will be treated
as a “true lease” for