##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D. C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
 For the quarterly period ended June 30, 2007
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
 For the transition period from  to
 Commission File Number: 001-32162
 CORPORATE PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 (Exact name of registrant as specified in its charter)
 Maryland
    
    80-0067704(State of incorporation)
    
    (I.R.S. Employer Identification No.)50 Rockefeller PlazaNew York, New York
    
    10020(Address of principal executive office)
    
    (Zip Code)
 Investor Relations (212) 492-8920
(212) 492-1100  (Registrants telephone numbers, including area code)
 þ o
  o o þ
 o þ




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##### 



INDEX
 Page No.PART I  FINANCIAL INFORMATIONItem 1.  Financial Statements*Consolidated Balance Sheets as of June 30, 2007 and December 31, 2006
    
    
    2Consolidated Statements of Income for the three and six months ended June 30, 2007 and 2006
    
    
    3Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2007 and 2006
    
    
    3Consolidated Statement of Shareholders Equity for the six months ended June 30, 2007
    
    
    4Consolidated Statements of Cash Flows for the six months ended June 30, 2007 and 2006
    
    
    5Notes to Consolidated Financial Statements
    
    
    6Item 2.  Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    17Item 3.  Quantitative and Qualitative Disclosures About Market Risk
    
    
    26Item 4T.  Controls and Procedures
    
    
    27PART II  OTHER INFORMATIONItem 2.  Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    28Item 4.  Submission of Matters to a Vote of Security Holders
    
    
    28Item 6.  Exhibits
    
    
    28Signatures
    
    
    29EX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32: CERTIFICATIONS
  
 *
    
    The summarized consolidated financial statements contained herein are unaudited; however, in
the opinion of management, all adjustments (consisting of normal recurring adjustments)
necessary for a fair statement of such financial statements have been included. Forward Looking Statements
   CPA®:16  Global 6/30/2007 10-Q 1




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##### Table of Contents



CORPORATE PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 PART I
 
 ITEM 1.  FINANCIAL STATEMENTS
 
 CONSOLIDATED BALANCE SHEETS (UNAUDITED)
 (in thousands, except share and per share amounts)
 June 30, 2007
    
    
    December 31, 2006(NOTE)AssetsReal estate, net
    
    $
    1,325,875
    
    
    $
    648,593Net investment in direct financing leases
    
    
    323,402
    
    
    
    308,073Equity investments in real estate
    
    
    115,590
    
    
    
    111,870Real estate under construction
    
    
    46,246
    
    
    
    75,372Notes receivable
    
    
    350,368
    
    
    
    9,603Cash and cash equivalents
    
    
    394,967
    
    
    
    464,223Intangible assets, net
    
    
    158,330
    
    
    
    108,001Other assets, net
    
    
    188,924
    
    
    
    49,905Total assets
    
    $
    2,903,702
    
    
    $
    1,775,640Liabilities and Shareholders EquityLiabilities:Limited recourse mortgage notes payable
    
    $
    1,230,788
    
    
    $
    630,795Note payable
    
    
    4,357
    
    
    
    3,450Accounts payable, accrued expenses and other liabilities
    
    
    120,632
    
    
    
    19,181Prepaid and deferred rental income and security deposits
    
    
    89,032
    
    
    
    34,749Due to affiliates
    
    
    54,500
    
    
    
    49,219Distributions payable
    
    
    18,744
    
    
    
    16,067Total liabilities
    
    
    1,518,053
    
    
    
    753,461Minority interest in consolidated entities
    
    
    389,437
    
    
    
    31,358Commitments and contingencies (Note 9)Shareholders equity:Common stock, $0.001 par value; 250,000,000 shares authorized;
116,701,430 and 114,701,851 shares issued and outstanding, respectively
    
    
    117
    
    
    
    115Additional paid-in capital
    
    
    1,047,697
    
    
    
    1,028,933Distributions in excess of accumulated earnings
    
    
    (56,728
    )
    
    
    (40,679
    )Accumulated other comprehensive income
    
    
    15,719
    
    
    
    9,0901,006,805
    
    
    
    997,459Less, treasury stock at cost, 1,139,065 and 713,803 shares, respectively
    
    
    (10,593
    )
    
    
    (6,638
    )Total shareholders equity
    
    
    996,212
    
    
    
    990,821Total liabilities and shareholders equity
    
    $
    2,903,702
    
    
    $
    1,775,640
   CPA®:16  Global 6/30/2007 10-Q 2




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##### Table of Contents



CORPORATE PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
 (in thousands, except share and per share amounts)
 Three months ended June 30,
    
    
    Six months ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006RevenuesRental income
    
    $
    29,028
    
    
    $
    11,798
    
    
    $
    47,271
    
    
    $
    22,153Interest income from direct financing leases
    
    
    6,468
    
    
    
    3,370
    
    
    
    12,614
    
    
    
    6,522Interest income on notes receivable
    
    
    6,310
    
    
    
    638
    
    
    
    6,616
    
    
    
    1,366Other operating income
    
    
    326
    
    
    
    655
    
    
    
    470
    
    
    
    74342,132
    
    
    
    16,461
    
    
    
    66,971
    
    
    
    30,784Operating ExpensesDepreciation and amortization
    
    
    (8,515
    )
    
    
    (3,112
    )
    
    
    (13,747
    )
    
    
    (5,766
    )Property expenses
    
    
    (5,181
    )
    
    
    (2,881
    )
    
    
    (9,170
    )
    
    
    (5,672
    )General and administrative
    
    
    (1,900
    )
    
    
    (1,019
    )
    
    
    (3,219
    )
    
    
    (2,093
    )(15,596
    )
    
    
    (7,012
    )
    
    
    (26,136
    )
    
    
    (13,531
    )Other Income and ExpensesIncome from equity investments in real estate
    
    
    1,519
    
    
    
    1,777
    
    
    
    3,271
    
    
    
    3,480Other interest income
    
    
    6,122
    
    
    
    1,970
    
    
    
    12,319
    
    
    
    3,431Minority interest in income
    
    
    (6,116
    )
    
    
    (516
    )
    
    
    (6,626
    )
    
    
    (991
    )Gain on foreign currency transactions and other, net
    
    
    49
    
    
    
    40
    
    
    
    318
    
    
    
    66Interest expense
    
    
    (17,175
    )
    
    
    (5,824
    )
    
    
    (27,367
    )
    
    
    (11,110
    )(15,601
    )
    
    
    (2,553
    )
    
    
    (18,085
    )
    
    
    (5,124
    )Income before income taxes
    
    
    10,935
    
    
    
    6,896
    
    
    
    22,750
    
    
    
    12,129Provision for income taxes
    
    
    (892
    )
    
    
    (47
    )
    
    
    (1,409
    )
    
    
    (280
    )Net Income
    
    $
    10,043
    
    
    $
    6,849
    
    
    $
    21,341
    
    
    $
    11,849Earnings Per Share
    
    $
    0.09
    
    
    $
    0.10
    
    
    $
    0.19
    
    
    $
    0.19Weighted Average Shares Outstanding
    
    
    115,527,351
    
    
    
    65,680,890
    
    
    
    115,102,574
    
    
    
    61,420,609Distributions Declared Per Share
    
    $
    0.1622
    
    
    $
    0.1588
    
    
    $
    0.3239
    
    
    $
    0.3163The accompanying notes are an integral part of these consolidated financial statements.CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)(in thousands)Three months ended June 30,
    
    
    Six months ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Net income
    
    $
    10,043
    
    
    $
    6,849
    
    
    $
    21,341
    
    
    $
    11,849Other comprehensive incomeChange in unrealized gain (loss) on marketable securities
    
    
    (111
    )
    
    
    23
    
    
    
    (105
    )
    
    
    (3
    )Foreign currency translation adjustment
    
    
    2,571
    
    
    
    2,527
    
    
    
    4,775
    
    
    
    4,549Change in unrealized gain on derivative instruments
    
    
    1,666
    
    
    
    873
    
    
    
    1,959
    
    
    
    1,2474,126
    
    
    
    3,423
    
    
    
    6,629
    
    
    
    5,793Comprehensive income
    
    $
    14,169
    
    
    $
    10,272
    
    
    $
    27,970
    
    
    $
    17,642
  CPA®:16  Global 6/30/2007 10-Q 3




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##### Table of Contents



CORPORATE PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 CONSOLIDATED STATEMENT OF SHAREHOLDERS EQUITY (UNAUDITED)
 For the six months ended June 30, 2007
 (in thousands, except share and per share amounts)
 Distributions
    
    
    Accumulatedin Excess of
    
    
    OtherCommon
    
    
    Additional
    
    
    Accumulated
    
    
    ComprehensiveShares
    
    
    Stock
    
    
    Paid-In Capital
    
    
    Earnings
    
    
    Income
    
    
    Treasury Stock
    
    
    TotalBalance at December 31, 2006
    
    
    113,988,048
    
    
    $
    115
    
    
    $
    1,028,933
    
    
    $
    (40,679
    )
    
    $
    9,090
    
    
    $
    (6,638
    )
    
    $
    990,821Cumulative effect adjustment
from adoption of FIN 48 (Note 11)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (90
    )
    
    
    
    
    
    
    
    
    
    
    (90
    )Balance at January 1, 2007
    
    
    113,988,048
    
    
    
    115
    
    
    
    1,028,933
    
    
    
    (40,769
    )
    
    
    9,090
    
    
    
    (6,638
    )
    
    
    990,731Shares issued $.001 par, at $10
per share, net of offering
costs
    
    
    1,610,047
    
    
    
    2
    
    
    
    14,869
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,871Shares, $.001 par, issued to
the advisor at $10 per
share(1)
    
    
    389,532
    
    
    
    
    
    
    
    3,895
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,895Distributions declared
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (37,300
    )
    
    
    
    
    
    
    
    
    
    
    (37,300
    )Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21,341
    
    
    
    
    
    
    
    
    
    
    
    21,341Change in other comprehensive
income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,629
    
    
    
    
    
    
    
    6,629Repurchase of shares
    
    
    (425,262
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,955
    )
    
    
    (3,955
    )Balance at June 30, 2007
    
    
    115,562,365
    
    
    $
    117
    
    
    $
    1,047,697
    
    
    $
    (56,728
    )
    
    $
    15,719
    
    
    $
    (10,593
    )
    
    $
    996,212
 
 (1)
    
    In July 2007, 1,194,549 shares of common stock were issued to the advisor in payment of
previously deferred performance fees (Note 4).  CPA®:16  Global 6/30/2007 10-Q 4




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##### Table of Contents



CORPORATE PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
 (in thousands)
 Six months ended June 30,2007
    
    
    2006Cash Flows  Operating ActivitiesNet income
    
    $
    21,341
    
    
    $
    11,849Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization including intangible assets and deferred financing costs
    
    
    13,893
    
    
    
    5,964Straight-line rent adjustments and amortization of rent-related intangibles
    
    
    (189
    )
    
    
    (909
    )Income from equity investments in real estate in excess of distributions received
    
    
    (1,278
    )
    
    
    (867
    )Minority interest in income
    
    
    6,626
    
    
    
    991Issuance of shares to affiliate in satisfaction of fees due
    
    
    3,895
    
    
    
    2,457Realized gain on foreign currency transactions, net
    
    
    (277
    )
    
    
    (230
    )Unrealized gain on foreign currency transactions, net
    
    
    (41
    )
    
    
    (2
    )Increase (decrease) in accrued interest
    
    
    5,516
    
    
    
    (48
    )Increase in due to affiliates
    
    
    5,159
    
    
    
    3,570Changes in operating assets and liabilities
    
    
    3,278
    
    
    
    1,360Net cash provided by operating activities
    
    
    57,923
    
    
    
    24,135Cash Flows  Investing ActivitiesDistributions from equity investments in real estate in excess of equity income
    
    
    1,396
    
    
    
    3,372Acquisitions of real estate and other capital expenditures
    
    
    (385,182
    )
    
    
    (145,964
    )Purchases of notes receivable
    
    
    (337,764
    )
    
    
    Contributions to equity investments in real estate
    
    
    (723
    )
    
    
    (10,088
    )Funds placed in escrow for future acquisition and construction of real estate
    
    
    (19,112
    )
    
    
    (29,915
    )Release of funds held in escrow for acquisition and construction of real estate
    
    
    3,985
    
    
    
    2,251VAT taxes (paid) recovered in connection with acquisitions of real estate
    
    
    (796
    )
    
    
    4,008Proceeds from maturity of short-term investment
    
    
    1,698
    
    
    
    Receipt of principal payment of mortgage note receivable
    
    
    142
    
    
    
    135Receipt of principal prepayment of mortgage note receivable
    
    
    
    
    
    
    20,000Net cash used in investing activities
    
    
    (736,356
    )
    
    
    (156,201
    )Cash Flows  Financing ActivitiesDistributions paid
    
    
    (34,623
    )
    
    
    (17,978
    )Distributions paid to minority interest partners
    
    
    (296,565
    )
    
    
    (985
    )Contributions from minority interest partners
    
    
    333,368
    
    
    
    Proceeds from mortgages and notes payable
    
    
    604,203
    
    
    
    73,732Scheduled payments of mortgage principal
    
    
    (4,941
    )
    
    
    (2,634
    )Deferred financing costs and mortgage deposits, net of deposits refunded
    
    
    (149
    )
    
    
    (691
    )Proceeds from issuance of shares, net of costs of raising capital
    
    
    14,871
    
    
    
    150,582Purchase of treasury stock
    
    
    (3,955
    )
    
    
    (2,209
    )Net cash provided by financing activities
    
    
    612,209
    
    
    
    199,817Change in Cash and Cash Equivalents During the PeriodEffect of exchange rate changes on cash
    
    
    (3,032
    )
    
    
    (229
    )Net (decrease) increase in cash and cash equivalents
    
    
    (69,256
    )
    
    
    67,522Cash and cash equivalents, beginning of period
    
    
    464,223
    
    
    
    155,374Cash and cash equivalents, end of period
    
    $
    394,967
    
    
    $
    222,896
  CPA®:16  Global 6/30/2007 10-Q 5




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##### Table of Contents



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 (in thousands, except share and per share amounts)
 Note 1. Business
  Note 2. Basis of Presentation
  Basis of Consolidation
    Information about International Geographic Areas
  Three months ended June 30,
    
    
    Six months ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Lease revenues
    
    $
    15,357
    
    
    $
    3,275
    
    
    $
    21,795
    
    
    $
    6,281Interest income on notes receivable
    
    
    6,131
    
    
    
    
    
    
    
    6,131
    
    
    
    Income from equity investments in real estate
    
    
    1,031
    
    
    
    1,060
    
    
    
    1,957
    
    
    
    2,014
 CPA®:16  Global 6/30/2007 10-Q 6




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##### Table of Contents



Notes to Consolidated Financial Statements
 As ofJune 30, 2007
    
    
    December 31, 2006Long-lived assets
    
    $
    1,133,031
    
    
    $
    329,079Equity investments in real estate
    
    
    77,042
    
    
    
    73,452
 Reclassifications
  Out-of-Period Adjustment
  Adoption of New Accounting Pronouncements
 SFAS 155
  FIN 48
  Recent Accounting Pronouncements
 SFAS 157
  SFAS 159
  SOP 07-1
  CPA®:16  Global 6/30/2007 10-Q 7




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##### Table of Contents



Notes to Consolidated Financial Statements
  FIN 46(R)-7
 Companies
 Note 3. Organization and Offerings
   Note 4. Agreements and Transactions with Related Parties
  st
 CPA®:16  Global 6/30/2007 10-Q 8




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##### Table of Contents



Notes to Consolidated Financial Statements
      Note 5. Real Estate
  June 30, 2007
    
    
    December 31, 2006Cost
    
    $
    1,352,295
    
    
    $
    663,810Less: Accumulated depreciation
    
    
    (26,420
    )
    
    
    (15,217
    )$
    1,325,875
    
    
    $
    648,593
 Note 6. Equity Investments in Real Estate
  CPA®:16  Global 6/30/2007 10-Q 9




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##### Table of Contents



Notes to Consolidated Financial Statements
  Ownership Interest at
    
    
    Carrying ValueLessee
    
    June 30, 2007
    
    
    June 30, 2007
    
    
    December 31, 2006U-Haul Moving Partners, Inc. and Mercury Partners, LP
    
    
    30.77%
    
    
    $
    36,591
    
    
    $
    36,150Hellweg Die Profi-Baumarkte GmbH & Co. KG (1)
    
    
    25%
    
    
    
    16,485
    
    
    
    15,397Police Prefecture, French Government
    
    
    50%
    
    
    
    13,827
    
    
    
    14,020OBI A.G. (2)
    
    
    25%
    
    
    
    13,328
    
    
    
    10,750Thales S.A.
    
    
    35%
    
    
    
    10,602
    
    
    
    10,355Pohjola Non-life Insurance Company
    
    
    40%
    
    
    
    9,997
    
    
    
    10,128TietoEnator Plc
    
    
    40%
    
    
    
    9,770
    
    
    
    9,918Actuant Corporation
    
    
    50%
    
    
    
    2,741
    
    
    
    2,883Consolidated Systems, Inc.
    
    
    40%
    
    
    
    2,249
    
    
    
    2,269$
    115,590
    
    
    $
    111,870
 
 (1)
    
    In April 2007, we acquired an interest in a second transaction with Hellweg which we
consolidate (Note 7).(2)
    
    We acquired an interest in an additional property leased to OBI during March 2007 (Note 7). ® ®
  June 30, 2007
    
    
    December 31, 2006Assets
    
    $
    311,194
    
    
    $
    311,116Liabilities
    
    
    (192,886
    )
    
    
    (194,281
    )Partners equity
    
    $
    118,308
    
    
    $
    116,835Six months ended June 30,2007
    
    
    2006Revenue
    
    $
    14,209
    
    
    $
    14,292Expenses
    
    
    (9,349
    )
    
    
    (9,492
    )Net income
    
    $
    4,860
    
    
    $
    4,800Our share of
income from equity investments in real estate
    
    $
    1,483
    
    
    $
    1,465
  June 30, 2007
    
    
    December 31, 2006Assets
    
    $
    893,458
    
    
    $
    856,156Liabilities
    
    
    (658,922
    )
    
    
    (635,993
    )Partners and members equity
    
    $
    234,536
    
    
    $
    220,163Six months ended June 30,2007
    
    
    2006Revenue
    
    $
    36,336
    
    
    $
    27,462Expenses
    
    
    (29,284
    )
    
    
    (20,968
    )Net income
    
    $
    7,052
    
    
    $
    6,494Our share of income from equity investments in real estate
    
    $
    1,788
    
    
    $
    2,015
 CPA®:16  Global 6/30/2007 10-Q 10




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##### Table of Contents



Notes to Consolidated Financial Statements
 Note 7. Acquisitions of Real Estate-Related Investments
 Real Estate Acquired
 2007
 2006 
 Equity Investments in Real Estate Acquired
 2007
 2006
 Notes Receivable
 2007
 Real Estate Under Construction
 2007
 2006
 Hellweg Die Profi-Baumarkte GmbH & Co. KG
  CPA®:16  Global 6/30/2007 10-Q 11




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##### Table of Contents



Notes to Consolidated Financial Statements
    Note 8. Intangibles
   June 30, 2007
    
    
    December 31, 2006Lease intangibles
In-place lease
    
    $
    93,911
    
    
    $
    67,984Tenant relationship
    
    
    25,487
    
    
    
    19,778Above-market rent
    
    
    49,940
    
    
    
    27,689Less: accumulated amortization
    
    
    (11,008
    )
    
    
    (7,450
    )$
    158,330
    
    
    $
    108,001Below-market rent
    
    $
    (41,667
    )
    
    $
    (24,792
    )Less: accumulated amortization
    
    
    1,698
    
    
    
    1,125$
    (39,969
    )
    
    $
    (23,667
    )
  Note 9. Commitments and Contingencies
   ®
 CPA®:16  Global 6/30/2007 10-Q 12




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##### Table of Contents



Notes to Consolidated Financial Statements
  ® ®
 ® ® ® ® ®
 ® ® ® ® ®
    CPA®:16  Global 6/30/2007 10-Q 13




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##### Table of Contents



Notes to Consolidated Financial Statements
 Note 10. Risk Management and Use of Derivative Financial Instruments
 Risk Management
  Use of Derivative Financial Instruments
   Interest Rate Swaps
   Foreign Currency Exchange
  Concentration of Credit Risk
   CPA®:16  Global 6/30/2007 10-Q 14




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##### Table of Contents



Notes to Consolidated Financial Statements
  Note 11. Income Taxes
     Note 12. Pro Forma Financial Information
  Three months ended June 30,
    
    Six months ended June 30,2007
    
    2006
    
    2007
    
    2006Pro forma total revenues
    
    $
    43,443
    
    
    $
    41,400
    
    
    $
    85,341
    
    
    $
    80,309Pro forma net income
    
    
    9,275
    
    
    
    7,977
    
    
    
    20,791
    
    
    
    13,515Pro forma earnings per share:Basic and diluted
    
    $
    0.08
    
    
    $
    0.07
    
    
    $
    0.18
    
    
    $
    0.12
  CPA®:16  Global 6/30/2007 10-Q 15




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##### Table of Contents



Notes to Consolidated Financial Statements
 Note 13. Subsequent Events
  CPA®:16  Global 6/30/2007 10-Q 16




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##### Table of Contents



ITEM 2.  MANAGEMENTS DISCUSSION AND ANALYSIS OF
 FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 (in thousands, except share and per share amounts)
  Executive Overview
 Business Overview
  Current Developments and Trends
  Investment Activity
    Financing Activity
 SEC Investigation 
 CPA®:16  Global 6/30/2007 10-Q 17




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##### Table of Contents



Quarterly Distribution
 Senior Management 
 Directors
  Investment Activity
 Financing
Activity
   Six months ended June 30,2007
    
    2006Total investments(a)
    
    $
    744,222
    
    
    $
    186,309Number of investments
    
    
    9
    
    
    
    7Average investment size
    
    $
    82,691
    
    
    $
    26,616Percentage of international investments
    
    
    64
    %
    
    
    38
    %
 
 (a)
    
    Inclusive of minority interest of our consolidated investments or reflects our proportionate
share of total cost under the equity method of accounting, as applicable, and based upon the
applicable foreign currency exchange rate at the date of acquisition, as applicable.    CPA®:16  Global 6/30/2007 10-Q 18




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##### Table of Contents



How Management Evaluates Results of Operations
     CPA®:16  Global 6/30/2007 10-Q 19




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##### Table of Contents







Six months ended June 30,2007
    
    
    2006Rental income
    
    $
    47,271
    
    
    $
    22,153Interest income from direct financing leases
    
    
    12,614
    
    
    
    6,522$
    59,885
    
    
    $
    28,675
  Six months ended June 30,Lessee
    
    2007
    
    
    2006Hellweg Die Profi-Baumarkte GmbH & Co. KG (a) (b) (c)
    
    $
    8,044
    
    
    $
    Telcordia Technologies, Inc.
    
    
    4,509
    
    
    
    4,442Fraikin SAS (b) (d)
    
    
    2,923
    
    
    
    The Talaria Company (Hinckley) (c)
    
    
    2,487
    
    
    
    2,507Nordic Cold Storage LLC(e)
    
    
    2,446
    
    
    
    Huntsman International, LLC
    
    
    2,003
    
    
    
    2,013MetoKote Corporation, MetoKote Canada Limited and MetoKote de Mexico(b)
    
    
    1,937
    
    
    
    1,884Ply Gem Industries, Inc. (b)
    
    
    1,824
    
    
    
    1,773TRW Vehicle Safety Systems Inc. (f)
    
    
    1,784
    
    
    
    Kings Super Markets Inc.(f)
    
    
    1,708
    
    
    
    603Gortz & Schiele GmbH & Co. and Goertz & Schiele Corporation (b) (c) (f)
    
    
    1,648
    
    
    
    Finisar Corporation
    
    
    1,632
    
    
    
    1,632Performance Fibers GmbH(b) (f)
    
    
    1,617
    
    
    
    Foss Manufacturing Company, LLC
    
    
    1,589
    
    
    
    1,598Polestar Petty Ltd. (b) (g)
    
    
    1,460
    
    
    
    1,313Dicks Sporting Goods, Inc. (c) (f)
    
    
    1,450
    
    
    
    674LFD Manufacturing Limited, IDS Logistics (Thailand) Limited and IDS
Manufacturing SDN BHD (b) (f)
    
    
    1,329
    
    
    
    1,163Edgen Murray Europe Limited (b)
    
    
    1,140
    
    
    
    1,025Bobs Discount Furniture, LLC (f)
    
    
    1,098
    
    
    
    687Hilite Germany GmbH & Co. KG (b) (f)
    
    
    1,041
    
    
    
    238Plantagen Finland Oy and Plantagen Sverige AB (b)
    
    
    903
    
    
    
    722Other (b) (e) (f)
    
    
    15,313
    
    
    
    6,401$
    59,885
    
    
    $
    28,675
 
 (a)
    
    Represents our interest in the Hellweg 2 transaction (see Current Developments and Trends
above). We also own an equity investment in other properties leased to Hellweg through a 2005
transaction.(b)
    
    Revenue amounts are subject to fluctuations in foreign currency exchange rates.(c)
    
    Includes lease revenues applicable to minority interests totaling $9,728 and $1,426 for the
six months ended June 30, 2007 and 2006, respectively.(d)
    
    We acquired our initial interest in this investment in December 2006 and acquired a further
investment in a follow-on transaction in March 2007.(e)
    
    We acquired or placed into service our interest in this investment during 2007.(f)
    
    We acquired or placed into service our interest in this investment during 2006.(g)
    
    Increase is due to CPI-based (or equivalent) rent increase. CPA®:16  Global 6/30/2007 10-Q 20




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##### Table of Contents



Ownership Interest at
    
    
    Six months ended June 30,Lessee
    
    June 30, 2007
    
    
    2007
    
    
    2006U-Haul Moving Partners, Inc. and Mercury Partners, LP
    
    
    30.77%
    
    
    $
    14,193
    
    
    $
    14,271OBI A.G. (a) (b)
    
    
    25%
    
    
    
    7,432
    
    
    
    3,501Hellweg Die Profi-Baumarkte GmbH & Co. KG (a) (c) (d)
    
    
    25%
    
    
    
    6,821
    
    
    
    6,202Thales S.A. (a) (d)
    
    
    35%
    
    
    
    6,354
    
    
    
    5,504Pohjola Non-life Insurance Company(a) (d)
    
    
    40%
    
    
    
    4,089
    
    
    
    3,732TietoEnator Plc (a) (d)
    
    
    40%
    
    
    
    3,840
    
    
    
    3,492Police Prefecture, French Government (a)
    
    
    50%
    
    
    
    3,313
    
    
    
    3,049Consolidated Systems, Inc.(e)
    
    
    40%
    
    
    
    911
    
    
    
    Actuant Corporation(a) (d)
    
    
    50%
    
    
    
    831
    
    
    
    752$
    47,784
    
    
    $
    40,503
 
 (a)
    
    Revenue amounts are subject to fluctuations in foreign currency exchange rates.(b)
    
    We acquired our initial interest in this investment in March 2006 and acquired a further
interest in an additional property leased to this tenant during 2007.(c)
    
    We acquired a 25% interest in this investment in 2005 that we account for as an equity
investment. In a separate transaction in 2007, we acquired an additional interest in
additional properties that we consolidate.(d)
    
    Increase is due to CPI-based (or equivalent) rent increases.(e)
    
    We acquired our interest in this investment during 2006. Results of Operations
  Lease Revenues
     Interest Income on Notes Receivable
  CPA®:16  Global 6/30/2007 10-Q 21




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##### Table of Contents



Depreciation and Amortization
  Property Expenses
  General and Administrative
  Other Interest Income
  Minority Interest in Income
   Interest Expense
  Provision for Income Taxes
  Net Income
   CPA®:16  Global 6/30/2007 10-Q 22




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##### Table of Contents



Financial Condition
 Uses of Cash During the Period
  Operating Activities
 Investing Activities
 Financing
Activities
 Summary of Financing
  June 30,2007
    
    
    2006Balance:Fixed rate
    
    $
    1,204,478
    
    
    $
    434,022Variable rate (1)
    
    
    30,667
    
    
    
    Total
    
    $
    1,235,145
    
    
    $
    434,022Percent of total debt:Fixed rate
    
    
    98
    %
    
    
    100
    %Variable rate (1)
    
    
    2
    %
    
    
    0
    %100
    %
    
    
    100
    %Weighted average interest rate at end of period:Fixed rate
    
    
    5.80
    %
    
    
    5.92
    %Variable rate(1)
    
    
    5.09
    %
    
    
    0
    %
 
 (1)
    
    Included in variable rate debt at June 30, 2007 is (i) $4,357 in aggregate principal of notes
payable which have not been hedged and (ii) a $26,310 mortgage obligation which currently
bears interest at a fixed rate but which has an interest rate reset feature which will change
the interest rate to a new fixed rate during the term. Cash Resources
  CPA®:16  Global 6/30/2007 10-Q 23




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##### Table of Contents




    
    The impact from any investments we enter into during 2007, the full year impact of
investments entered into in 2006 and the expected completion of several build-to-suit
projects in 2007, all of which we currently expect will have a net positive impact on cash
flow.
    
    The advisors election in 2007 to continue to receive asset management and performance fees
in restricted shares will result in additional cash flow.
    
    Scheduled rent increases on several properties during 2007 should result in additional cash
flow.
 Cash Requirements
   
    
    Deferred acquisition fee installments and interest on deferred acquisition fees totaling
$31,674 and $2,300, respectively. These amounts are payable in cash beginning January 2008 in
accordance with the terms of the advisory agreement and we expect to use our existing cash
resources to make these payments. We will pay the deferred structuring fees in three annual
installments of $28,259 in January 2008 (including the accrued interest), $4,663 in January
2009 and $1,052 in January 2010. Interest will accrue on amounts outstanding at the rate of
5% per annum.
    
    Performance fees totaling $11,945 were paid in July 2007 through the issuance of 1,194,549
shares of our restricted common stock. As the advisor has elected to continue to receive
asset management and performance fees in common stock in 2007, performance fees incurred
during the remainder of 2007 will also be paid through the issuance of common stock.
 Aggregate Contractual Agreements
  Less than
    
    
    
    
    
    
    
    
    
    
    More thanTotal
    
    
    1 year
    
    
    13 years
    
    
    35 years
    
    
    5 yearsMortgage notes payable  Principal
    
    $
    1,230,788
    
    
    $
    12,129
    
    
    $
    34,227
    
    
    $
    45,823
    
    
    $
    1,138,609Mortgage notes payable  Interest
    
    
    691,655
    
    
    
    71,762
    
    
    
    140,903
    
    
    
    136,374
    
    
    
    342,616Note payable  Principal (1)
    
    
    4,357
    
    
    
    4,357
    
    
    
    
    
    
    
    
    
    
    
    Note payable  Interest(2)
    
    
    134
    
    
    
    134
    
    
    
    
    
    
    
    
    
    
    
    Deferred acquisition fees  Principal
    
    
    35,210
    
    
    
    27,137
    
    
    
    8,073
    
    
    
    
    
    
    
    Deferred acquisition fees  Interest
    
    
    4,121
    
    
    
    3,606
    
    
    
    515
    
    
    
    
    
    
    
    Build-to-suit commitments (3)
    
    
    35,369
    
    
    
    35,369
    
    
    
    
    
    
    
    
    
    
    
    Lending commitments (4)
    
    
    52,398
    
    
    
    52,398
    
    
    
    
    
    
    
    
    
    
    
    Operating leases (5)
    
    
    2,998
    
    
    
    306
    
    
    
    617
    
    
    
    643
    
    
    
    1,432$
    2,057,030
    
    
    $
    207,198
    
    
    $
    184,335
    
    
    $
    182,840
    
    
    $
    1,482,657
 
 (1)
    
    Represents a note payable obtained in connection with an investment in France in order to
fund the payment of value added taxes.(2)
    
    Interest on this variable rate debt obligation, which has not been hedged, was calculated
using the applicable variable interest rate and balance outstanding as of June 30, 2007(3)
    
    Represents remaining build-to-suit commitments for four projects: Blairsville, Pennsylvania  estimated total construction costs are currently projected
to be $25,152 of which $21,717 was funded as of June 30,
2007. CPA®:16  Global 6/30/2007 10-Q 24




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##### Table of Contents




    
    Bloomington, Minnesota  estimated total construction costs are currently projected to
be $46,848 of which $22,314 was funded as of June 30, 2007.
    
    Norwich, Connecticut  estimated total construction costs are currently projected to be
$12,500 of which $12,098 was funded as of June 30, 2007.
    
    Columbia, South Carolina  estimated total construction costs are currently projected
to be $7,000. (4)
    
    Represents unfunded amounts on a commitment to provide a loan to a developer of a domestic
property.(5)
    
    Operating lease obligations consist primarily of our share of future minimum rents payable
under an office cost-sharing agreement with certain affiliates for the purpose of leasing
office space used for the administration of real estate entities. Such amounts are allocated
among the entities based on gross revenues and are adjusted quarterly.   Ownership Interest at
    
    
    
    
    
    
    Total ThirdLessee
    
    June 30, 2007
    
    
    Total Assets
    
    
    Party Debt
    
    
    Maturity DateThales S.A.
    
    
    35%
    
    
    $
    113,688
    
    
    $
    78,614
    
    
    
    07/2011U-Haul Moving Partners, Inc. and Mercury Partners, LP
    
    
    30.77%
    
    
    
    311,194
    
    
    
    173,516
    
    
    
    05/2014Actuant Corporation
    
    
    50%
    
    
    
    18,103
    
    
    
    11,908
    
    
    
    05/2014TietoEnator Plc
    
    
    40%
    
    
    
    100,276
    
    
    
    74,726
    
    
    
    07/2014Pohjola Non-life Insurance Company
    
    
    25%
    
    
    
    109,518
    
    
    
    82,955
    
    
    
    01/2015Hellweg Die Profi-Baumarkte GmbH & Co. KG (1)
    
    
    25%
    
    
    
    185,125
    
    
    
    111,958
    
    
    
    05/2015Consolidated Systems, Inc.
    
    
    40%
    
    
    
    17,511
    
    
    
    11,917
    
    
    
    11/2016OBI A.G. (2)
    
    
    25%
    
    
    
    230,632
    
    
    
    167,884
    
    
    
    03/2018Police Prefecture, French Government
    
    
    50%
    
    
    
    118,605
    
    
    
    86,876
    
    
    
    08/2020$
    1,204,652
    
    
    $
    800,354
 
 (1)
    
    In 2005, we obtained a 25% interest in a venture that leases properties to Hellweg that we
account for as an equity investment. In addition, through a separate transaction in 2007, we
obtained an effective ownership interest of 25.98% in two ventures that also lease properties
to Hellweg that we consolidate under the provisions of FIN 46R that
are excluded from the amounts in the table above (see Current Developments and
Trends above).(2)
    
    We acquired an interest in an additional property leased to OBI during March 2007. CPA®:16  Global 6/30/2007 10-Q 25




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##### Table of Contents



ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 (in thousands)
 Market Risks
   Interest Rate Risk
      2007
    
    
    2008
    
    
    2009
    
    
    2010
    
    
    2011
    
    
    Thereafter
    
    
    Total
    
    
    Fair valueFixed rate debt
    
    $
    5,854
    
    
    $
    12,812
    
    
    $
    17,381
    
    
    $
    19,791
    
    
    $
    22,885
    
    
    $
    1,125,755
    
    
    $
    1,204,478
    
    
    $
    1,190,926Weighted average interest rate
    
    
    5.89
    %
    
    
    5.92
    %
    
    
    5.86
    %
    
    
    5.86
    %
    
    
    5.85
    %
    
    
    5.79
    %Variable rate debt
    
    $
    
    
    
    $
    4,522
    
    
    $
    329
    
    
    $
    329
    
    
    $
    329
    
    
    $
    25,158
    
    
    $
    30,667
    
    
    $
    30,667
  Foreign Currency Exchange Rate Risk
  CPA®:16  Global 6/30/2007 10-Q 26




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##### Table of Contents



Item 4T.  Controls and Procedures
 Disclosure Controls and Procedures
   Changes in Internal Control over Financial Reporting
  CPA®:16  Global 6/30/2007 10-Q 27




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##### Table of Contents



PART II
 (in thousands, except share and per share amounts)
 
 Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds
 (a)
    
    For the three months ended June 30, 2007, 209,825 shares of common stock were issued to the
advisor as consideration for asset management fees. Shares were issued at $10 per share. Since
none of these transactions were considered to have involved a public offering within the
meaning of Section 4(2) of the Securities Act, as amended, the shares issued were deemed to be
exempt from registration. In acquiring our shares, the advisor represented that such interests
were being acquired by it for the purposes of investment and not with a view to the
distribution thereof.
 (c)
    
    Issuer Purchases of Equity Securities
 Maximum number (orTotal number of shares
    
    approximate dollar value) ofpurchased as part of
    
    shares that may yet beTotal number of
    
    Average price
    
    publicly announced
    
    purchased under the2007 Period
    
    shares purchased(1)
    
    paid per share
    
    plans or programs(1)
    
    plans or programs(1)April
    
    
    
    
    
    
    
    
    
    
    N/A
    
    
    
    N/AMay
    
    
    
    
    
    
    
    
    
    
    N/A
    
    
    
    N/AJune
    
    
    263,055
    
    
    $
    9.30
    
    
    
    N/A
    
    
    
    N/ATotal
    
    
    263,055
 
 (1)
    
    All shares were purchased pursuant to our redemption plan, which we announced in December
2003. Under our redemption plan we may elect to redeem shares of our common stock subject to
certain conditions and limitations. The maximum amount of shares purchasable by us in any
period depends on the availability of funds generated by the Amended and Restated 2003
Distribution Reinvestment and Stock Purchase Plan and other factors at the discretion of our
Board of Directors. However, at no time during a 12-month period may the number of shares
redeemed by us exceed 5% of the number of shares of our outstanding common stock at the
beginning of such period. The redemption plan will terminate if and when our shares are listed
on a national securities exchange or included for quotation on Nasdaq. 
 Item 4.  Submission of Matters to a Vote of Security Holders
  Name of Director
    
    Total Shares Voting
    
    Shares Voting For
    
    Shares WithheldWm. Polk Carey
    
    
    59,271,306
    
    
    
    58,095,448
    
    
    
    1,175,858Gordon F. DuGan
    
    
    59,271,306
    
    
    
    58,162,524
    
    
    
    1,108,782Marshall E. Blume
    
    
    59,271,306
    
    
    
    58,143,178
    
    
    
    1,128,128Elizabeth P. Munson
    
    
    59,271,306
    
    
    
    58,189,155
    
    
    
    1,082,151Richard J. Pinola
    
    
    59,271,306
    
    
    
    58,159,357
    
    
    
    1,111,949James D. Price
    
    
    59,271,306
    
    
    
    58,150,900
    
    
    
    1,120,406
 
 Item 6.  Exhibits
 Exhibit No.
    
    Description
    
    Method of Filing31.1
    
    
    
    Certification of Chief Executive
Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002
    
    Filed herewith31.2
    
    
    
    Certification of Chief Financial
Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002
    
    Filed herewith32
    
    
    
    Certifications of Chief Executive
Officer and Chief Financial Officer
pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
    
    Filed herewith
 CPA®:16  Global 6/30/2007 10-Q 28




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##### Table of Contents



SIGNATURES
  Corporate Property Associates 16  Global IncorporatedDate 8/14/2007
    By:
    /s/ Mark J. DeCesarisMark J. DeCesarisManaging Director and acting Chief
Financial Officer
(acting Principal Financial Officer)Date 8/14/2007
    By:
    /s/ Thomas RidingsThomas RidingsExecutive Director and Chief Accounting Officer
(Principal Accounting Officer) CPA®:16  Global 6/30/2007 10-Q 29