##### 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 March 31, 2009
 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
  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
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




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##### 



INDEX
 Page No.PART I  FINANCIAL INFORMATIONItem 1. Financial Statements*Consolidated Balance Sheets as of March 31, 2009 and December 31, 2009
    
    
    2Consolidated Statements of Operations for the three months ended March 31, 2009 and 2008
    
    
    3Consolidated Statements of Comprehensive (Loss) Income for the three months ended March 31, 2009 and 2008
    
    
    4Consolidated Statements of Cash Flows for the three months ended March 31, 2009 and 2008
    
    
    5Notes to Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    18Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    28Item 4T. Controls and Procedures
    
    
    29PART II  OTHER INFORMATIONItem 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    30Item 6. Exhibits
    
    
    30Signatures
    
    
    31EX-31.1EX-31.2EX-32
  
 *
    
    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 3/31/2009 10-Q 1




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##### Table of Contents



PART I
 
 Item 1. Financial Statements
 CORPORATE
PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 Consolidated Balance Sheets (Unaudited)
 (in thousands, except share and per share amounts)
 March 31, 2009
    
    
    December 31, 2008(NOTE)AssetsReal estate, net
    
    $
    1,539,903
    
    
    $
    1,584,217Net investment in direct financing leases
    
    
    328,798
    
    
    
    341,335Equity investments in real estate
    
    
    239,081
    
    
    
    185,120Operating real estate, net
    
    
    79,471
    
    
    
    79,470Real estate under construction
    
    
    4,571
    
    
    
    483Notes receivable
    
    
    331,898
    
    
    
    351,200Cash and cash equivalents
    
    
    74,652
    
    
    
    174,209Intangible assets, net
    
    
    161,146
    
    
    
    168,088Funds in escrow
    
    
    27,777
    
    
    
    52,163Other assets, net
    
    
    36,558
    
    
    
    30,918Total assets
    
    $
    2,823,855
    
    
    $
    2,967,203Liabilities and EquityLiabilities:Non-recourse debt
    
    $
    1,385,841
    
    
    $
    1,438,226Accounts payable, accrued expenses and other liabilities
    
    
    39,620
    
    
    
    52,836Prepaid and deferred rental income and security deposits
    
    
    57,031
    
    
    
    56,053Due to affiliates
    
    
    12,246
    
    
    
    21,502Distributions payable
    
    
    20,169
    
    
    
    20,140Total liabilities
    
    
    1,514,907
    
    
    
    1,588,757Redeemable noncontrolling interests
    
    
    310,914
    
    
    
    331,841Commitments and contingenciesEquity:CPA®:16  Global shareholders equity:Common stock, $0.001 par value; 250,000,000 shares authorized; 126,536,255 and
125,352,123 shares issued, respectively
    
    
    127
    
    
    
    125Additional paid-in capital
    
    
    1,141,507
    
    
    
    1,130,135Distributions in excess of accumulated earnings
    
    
    (169,752
    )
    
    
    (141,938
    )Accumulated other comprehensive (loss) income
    
    
    (15,205
    )
    
    
    2,140956,677
    
    
    
    990,462Less, treasury stock at cost, 4,529,584 and 3,286,473 shares, respectively
    
    
    (41,898
    )
    
    
    (30,566
    )Total CPA®:16  Global shareholders equity
    
    
    914,779
    
    
    
    959,896Noncontrolling interests
    
    
    83,255
    
    
    
    86,709Total equity
    
    
    998,034
    
    
    
    1,046,605Total liabilities and equity
    
    $
    2,823,855
    
    
    $
    2,967,203
   CPA ® :16  Global 3/31/2009 10-Q 2




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##### Table of Contents



CORPORATE PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 Consolidated Statements of Operations (Unaudited)
 (in thousands, except share and per share amounts)
 Three months ended March 31,2009
    
    
    2008RevenuesRental income
    
    $
    37,555
    
    
    $
    36,781Interest income from direct financing leases
    
    
    6,663
    
    
    
    7,081Interest income on notes receivable
    
    
    6,659
    
    
    
    7,281Other real estate income
    
    
    5,714
    
    
    
    4,541Other income
    
    
    822
    
    
    
    57457,413
    
    
    
    56,258Operating ExpensesDepreciation and amortization
    
    
    (11,676
    )
    
    
    (11,129
    )Property expenses
    
    
    (8,831
    )
    
    
    (7,503
    )Other real estate expenses
    
    
    (4,441
    )
    
    
    (4,040
    )General and administrative
    
    
    (2,552
    )
    
    
    (3,270
    )Impairment charge
    
    
    (15,984
    )
    
    
    (43,484
    )
    
    
    (25,942
    )Other Income and ExpensesIncome from equity investments in real estate
    
    
    3,064
    
    
    
    2,553Other interest income
    
    
    125
    
    
    
    1,592Gain on extinguishment of debt
    
    
    6,512
    
    
    
    Other income and expenses
    
    
    (332
    )
    
    
    2,532Interest expense
    
    
    (20,436
    )
    
    
    (21,307
    )(11,067
    )
    
    
    (14,630
    )Income before income taxes
    
    
    2,862
    
    
    
    15,686Provision for income taxes
    
    
    (297
    )
    
    
    (1,328
    )Net Income
    
    
    2,565
    
    
    
    14,358Less: Net income attributable to noncontrolling interests
    
    
    (4,183
    )
    
    
    (1,887
    )Less: Net income attributable to redeemable noncontrolling interests
    
    
    (6,027
    )
    
    
    (6,659
    )Net (loss) income attributable to CPA®:16  Global shareholders
    
    $
    (7,645
    )
    
    $
    5,812Earnings (Loss) Per ShareNet (loss) income attributable to CPA®:16  Global shareholders
    
    $
    (0.06
    )
    
    $
    0.05Weighted Average Shares Outstanding
    
    
    122,789,807
    
    
    
    119,940,316Distributions Declared Per Share
    
    $
    0.1653
    
    
    $
    0.1637
  CPA ® :16  Global 3/31/2009 10-Q 3




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CORPORATE
PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 Consolidated Statements of Comprehensive (Loss) Income (Unaudited)
 (in thousands)
 Three months ended March 31,2009
    
    
    2008Net Income
    
    $
    2,565
    
    
    $
    14,358Other Comprehensive (Loss) IncomeForeign currency translation adjustment
    
    
    (41,132
    )
    
    
    43,133Change in unrealized loss on derivative instruments
    
    
    (1,099
    )
    
    
    (1,262
    )Change in unrealized gain (loss) on marketable securities
    
    
    3
    
    
    
    (19
    )(42,228
    )
    
    
    41,852Comprehensive (loss) income
    
    
    (39,663
    )
    
    
    56,210Less: Net income attributable to noncontrolling interests
    
    
    (4,183
    )
    
    
    (1,887
    )Less: Net income attributable to redeemable noncontrolling interests
    
    
    (6,027
    )
    
    
    (6,659
    )Add: Foreign currency translation adjustment attributable to noncontrolling interests
    
    
    3,954
    
    
    
    (4,417
    )Add: Change in unrealized loss on derivative instruments attributable to
noncontrolling interests
    
    
    2
    
    
    
    Add: Foreign currency translation adjustment attributable to redeemable
noncontrolling interests
    
    
    20,927
    
    
    
    (25,211
    )Comprehensive (Loss) Income Attributable to CPA®:16  Global Shareholders
    
    $
    (24,990
    )
    
    $
    18,036
  CPA ® :16  Global 3/31/2009 10-Q 4




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CORPORATE PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 Consolidated Statements of Cash Flows (Unaudited)
 (in thousands)
 Three months ended March 31,2009
    
    
    2008Cash Flows  Operating ActivitiesNet income
    
    $
    2,565
    
    
    $
    14,358Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization including intangible assets and deferred financing costs
    
    
    11,966
    
    
    
    12,170Straight-line rent adjustments and amortization of rent-related intangibles
    
    
    345
    
    
    
    (299
    )Income from equity investments in real estate in excess of distributions received
    
    
    (635
    )
    
    
    (1,409
    )Issuance of shares to affiliate in satisfaction of fees due
    
    
    3,026
    
    
    
    3,395Gain on extinguishment of debt
    
    
    (6,512
    )
    
    
    Realized loss (gain) on foreign currency transactions, net
    
    
    796
    
    
    
    (1,109
    )Unrealized gain on foreign currency and derivative transactions, net
    
    
    (464
    )
    
    
    (1,423
    )Impairment charge
    
    
    15,984
    
    
    
    Change in other operating assets and liabilities, net
    
    
    (909
    )
    
    
    1,786Net cash provided by operating activities
    
    
    26,162
    
    
    
    27,469Cash Flows  Investing ActivitiesDistributions from equity investments in real estate in excess of equity income
    
    
    5,503
    
    
    
    653Contributions to equity investments in real estate
    
    
    (65,318
    )
    
    
    (2,298
    )Acquisitions of real estate and other capital expenditures
    
    
    (17,560
    )
    
    
    (61,477
    )Funding/purchases of notes receivable
    
    
    (1,807
    )
    
    
    (815
    )Funds placed in escrow for future acquisition and construction of real estate
    
    
    
    
    
    
    (17,751
    )Release of funds held in escrow for acquisition and construction of real estate
    
    
    6,620
    
    
    
    19,844Proceeds from sale of land
    
    
    120
    
    
    
    Receipt of principal payment of mortgage note receivable
    
    
    
    
    
    
    74Payment of deferred acquisition fees to affiliate
    
    
    (9,082
    )
    
    
    (29,546
    )Net cash used in investing activities
    
    
    (81,524
    )
    
    
    (91,316
    )Cash Flows  Financing ActivitiesDistributions paid
    
    
    (20,140
    )
    
    
    (19,432
    )Distributions paid to noncontrolling interests
    
    
    (12,469
    )
    
    
    (7,198
    )Contributions from noncontrolling interests
    
    
    2,543
    
    
    
    Proceeds from mortgages and notes payable
    
    
    29,000
    
    
    
    88,972Scheduled payments of mortgage principal
    
    
    (3,979
    )
    
    
    (3,986
    )Prepayment of mortgages and note payable
    
    
    (32,500
    )
    
    
    (3,286
    )Deferred financing costs and mortgage deposits, net of deposits refunded
    
    
    (284
    )
    
    
    (371
    )Proceeds from issuance of shares, net of costs of raising capital
    
    
    8,348
    
    
    
    8,302Purchase of treasury stock
    
    
    (11,332
    )
    
    
    (2,150
    )Net cash (used in) provided by financing activities
    
    
    (40,813
    )
    
    
    60,851Change in Cash and Cash Equivalents During the PeriodEffect of exchange rate changes on cash
    
    
    (3,382
    )
    
    
    1,210Net decrease in cash and cash equivalents
    
    
    (99,557
    )
    
    
    (1,786
    )Cash and cash equivalents, beginning of period
    
    
    174,209
    
    
    
    211,759Cash and cash equivalents, end of period
    
    $
    74,652
    
    
    $
    209,973
  CPA ® :16  Global 3/31/2009 10-Q 5




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Notes to Consolidated Financial Statements (Unaudited)
 Note 1. Business
 
 Note 2. Basis of Presentation
  Basis of Consolidation
     CPA ® :16  Global 3/31/2009 10-Q 6




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##### Table of Contents



Notes to Consolidated Financial Statements
 Information about International Geographic Areas
  Reclassifications and Revisions
  Adoption of New Accounting Pronouncements
 SFAS 157
  SFAS 141R
  SFAS 160
  SFAS 161
  FSP 142-3
  CPA ® :16  Global 3/31/2009 10-Q 7




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Notes to Consolidated Financial Statements
  Recent Accounting Pronouncements
 FSP 107-1
  FSP 157-4
  FSP 115-2 and 124-2
  Note 3. Agreements and Transactions with Related Parties
  ®
  CPA ® :16  Global 3/31/2009 10-Q 8




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Notes to Consolidated Financial Statements
     ® ®
 Note 4. Real Estate
  March 31, 2009
    
    
    December 31, 2008Land
    
    $
    325,886
    
    
    $
    340,216Buildings
    
    
    1,298,581
    
    
    
    1,320,944Less: Accumulated depreciation
    
    
    (84,564
    )
    
    
    (76,943
    )$
    1,539,903
    
    
    $
    1,584,217
 
 The valuation of impaired real estate assets is determined using
widely accepted valuation techniques including discounted cash flow analysis on the
expected cash flows, the income capitalization approach considering prevailing market
capitalization rates, analysis of recent comparable sales transactions, actual sales
negotiations and bona fide purchase offers received from third parties and/or
consideration of the amount that currently would be required to replace the asset,
as adjusted for obsolescence. In general, we consider multiple valuation techniques
when measuring fair value of an investment. However, in certain circumstances,
a single valuation technique may be appropriate. The fair value of real estate
investments generally reflects sale costs as required by SFAS 144, Accounting for
the Impairment or Disposal of Long-Lived Assets (SFAS 144),
which may be incurred upon disposition of real estate investments.In accordance with SFAS 144, during the first quarter of 2009 we recognized an impairment charge of $16 million on a domestic property to reduce the propertys carrying value of $29.3 million to its estimated fair value of $13.3 million.  March 31, 2009
    
    
    December 31, 2008Land
    
    $
    8,296
    
    
    $
    8,296Buildings
    
    
    75,260
    
    
    
    74,480Less: Accumulated depreciation
    
    
    (4,085
    )
    
    
    (3,306
    )$
    79,471
    
    
    $
    79,470
  CPA ® :16  Global 3/31/2009 10-Q 9




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##### Table of Contents



Notes to Consolidated Financial Statements
 Note 5. Equity Investments in Real Estate
    Ownership Interest at
    
    
    Carrying ValueLessee
    
    March 31, 2009
    
    
    March 31, 2009
    
    
    December 31, 2008Equity Investments in Real Estate:The New York Times Company (a)
    
    
    27
    %
    
    $
    64,237
    
    
    $
    U-Haul Moving Partners, Inc. and Mercury Partners, LP
    
    
    31
    %
    
    
    34,546
    
    
    
    34,817Schuler A.G. (b)
    
    
    33
    %
    
    
    20,863
    
    
    
    22,982Frontier Spinning Mills, Inc.
    
    
    40
    %
    
    
    15,558
    
    
    
    15,551Hellweg Die Profi-Baumarkte GmbH & Co. KG (Hellweg 1) (b)
    
    
    25
    %
    
    
    15,437
    
    
    
    16,058Police Prefecture, French Government (b)
    
    
    50
    %
    
    
    8,411
    
    
    
    13,310TietoEnator Plc (b)
    
    
    40
    %
    
    
    7,866
    
    
    
    8,385Pohjola Non-life Insurance Company (b)
    
    
    40
    %
    
    
    7,187
    
    
    
    7,696OBI A.G. (b)
    
    
    25
    %
    
    
    6,865
    
    
    
    8,829Actebis Peacock GmbH (b)
    
    
    30
    %
    
    
    5,498
    
    
    
    5,833Lindenmaier A.G. (b)
    
    
    33
    %
    
    
    4,101
    
    
    
    4,565Actuant Corporation (b)
    
    
    50
    %
    
    
    2,691
    
    
    
    2,845Consolidated Systems, Inc.
    
    
    40
    %
    
    
    2,151
    
    
    
    2,164Thales S.A. (b)(c)
    
    
    35
    %
    
    
    
    
    
    
    195,411
    
    
    
    143,035ADC Equity Arrangement:Soho House Beach House LLC (d)
    
    
    N/A
    
    
    
    43,670
    
    
    
    42,085$
    239,081
    
    
    $
    185,120
 
 (a)
    
    We acquired our interest in this investment during the first quarter of 2009 (Note 6).(b)
    
    Carrying value of investment is affected by the impact of fluctuations in the exchange rate
of the Euro.(c)
    
    We recognized other than temporary impairment charges totaling $1.7 million during 2008 to
reduce the carrying value of our investment to its estimated fair value. As of March 31, 2009
and December 31, 2008, our proportionate share of losses at the equity investment level,
including impairment charges, was greater than our investment basis, and as such, the carrying
value of our equity investment was reduced to zero.(d)
    
    The ADC equity arrangement provides for a fixed annual interest rate of 5.8% and matures in
April 2010. We are committed to purchase the property at a fixed price upon completion, and
the borrower has little or no equity in the transaction. At March 31, 2009 and December 31,
2008, we had funded $38 million and $37 million, respectively, of our total commitment of
$62.5 million. CPA ® :16  Global 3/31/2009 10-Q 10




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Notes to Consolidated Financial Statements
  March 31, 2009
    
    
    December 31, 2008Assets
    
    $
    1,506,656
    
    
    $
    1,388,116Liabilities
    
    
    (860,923
    )
    
    
    (911,235
    )Partners and members equity
    
    $
    645,733
    
    
    $
    476,881Three months ended March 31,2009
    
    
    2008Revenues
    
    $
    30,462
    
    
    $
    29,939Expenses
    
    
    (21,068
    )
    
    
    (21,811
    )Net income
    
    $
    9,394
    
    
    $
    8,128Income from equity investments in real estate (a)
    
    $
    3,064
    
    
    $
    2,553
 
 (a)
    
    Inclusive of amortization of differences between the fair value of investments acquired and
the carrying value of the ventures net assets as of the date of acquisition and depreciation
adjustments related to other-than-temporary impairment charges. Note 6. Acquisitions of Real Estate-Related Investments
 Equity Investment in Real Estate Acquired
 2009  ®
 Real Estate Under Construction
  Note 7. Fair Value Measurements
  Fair Value Measurements at Reporting Date Using:Quoted Prices inActive Markets for
    
    
    Significant Other
    
    
    UnobservableIdentical Assets
    
    
    Observable Inputs
    
    
    InputsDescription
    
    March 31, 2009
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Assets:Money market funds
    
    $
    49,786
    
    
    $
    49,786
    
    
    $
    
    
    
    $
    Marketable equity securities
    
    
    2,119
    
    
    
    
    
    
    
    
    
    
    
    2,119Derivative assets
    
    
    3,532
    
    
    
    
    
    
    
    38
    
    
    
    3,494$
    55,437
    
    
    $
    49,786
    
    
    $
    38
    
    
    $
    5,613Liabilities:Derivative liabilities
    
    $
    (486
    )
    
    $
    
    
    
    $
    (486
    )
    
    $
    
 CPA ® :16  Global 3/31/2009 10-Q 11




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Notes to Consolidated Financial Statements
 Fair Value Measurements at Reporting Date Using:Quoted Prices inActive Markets for
    
    
    Significant Other
    
    
    UnobservableIdentical Assets
    
    
    Observable Inputs
    
    
    InputsDescription
    
    December 31, 2008
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Assets:Money market funds
    
    $
    137,203
    
    
    $
    137,203
    
    
    $
    
    
    
    $
    Marketable securities
    
    
    2,192
    
    
    
    
    
    
    
    
    
    
    
    2,192Derivative assets
    
    
    2,973
    
    
    
    
    
    
    
    
    
    
    
    2,973$
    142,368
    
    
    $
    137,203
    
    
    $
    
    
    
    $
    5,165Liabilities:Derivative liabilities
    
    $
    (520
    )
    
    $
    
    
    
    $
    (520
    )
    
    $
    
  Fair Value Measurements UsingSignificant Unobservable Inputs (Level 3 Only)Marketable
    
    
    Derivative
    
    
    Total
    
    
    Marketable
    
    
    Derivative
    
    
    TotalSecurities
    
    
    Assets
    
    
    Assets
    
    
    Securities
    
    
    Assets
    
    
    AssetsThree months ended March 31, 2009
    
    
    Three months ended March 31, 2008Beginning balance
    
    $
    2,192
    
    
    $
    2,973
    
    
    $
    5,165
    
    
    $
    2,438
    
    
    $
    6,246
    
    
    $
    8,684Total gains or losses (realized and unrealized):Included in earnings
    
    
    
    
    
    
    647
    
    
    
    647
    
    
    
    
    
    
    
    1,435
    
    
    
    1,435Included in other comprehensive income
    
    
    3
    
    
    
    (126
    )
    
    
    (123
    )
    
    
    (19
    )
    
    
    485
    
    
    
    466Amortization and accretion
    
    
    (76
    )
    
    
    
    
    
    
    (76
    )
    
    
    (74
    )
    
    
    
    
    
    
    (74
    )Ending balance
    
    $
    2,119
    
    
    $
    3,494
    
    
    $
    5,613
    
    
    $
    2,345
    
    
    $
    8,166
    
    
    $
    10,511The amount of total gains or losses for the period
included in earnings attributable to the change in
unrealized gains or losses relating to assets
still held at the reporting date
    
    $
    
    
    
    $
    647
    
    
    $
    647
    
    
    $
    
    
    
    $
    1,435
    
    
    $
    1,435
   Note 8. Risk Management and Use of Derivative Financial Instruments
 Risk Management
  CPA ® :16  Global 3/31/2009 10-Q 12




---



##### Table of Contents



Notes to Consolidated Financial Statements
 Foreign Currency Exchange
  Use of Derivative Financial Instruments
    Asset Derivatives
    
    
    Liability DerivativesBalance Sheet
    
    Fair Value at
    
    
    Fair Value at
    
    
    Fair Value at
    
    
    Fair Value atLocation
    
    March 31, 2009
    
    
    December 31, 2008
    
    
    March 31, 2009
    
    
    December 31, 2008Derivatives designated as
hedging
instruments under SFAS 133Interest rate caps
    
    Other assets
    
    $
    20
    
    
    $
    
    
    
    $
    
    
    
    $
    Foreign exchange contracts
    
    Other assets
    
    
    18
    
    
    
    
    
    
    
    
    
    
    
    Interest rate swaps
    
    Other liabilities
    
    
    
    
    
    
    
    
    
    
    (486
    )
    
    
    (520
    )38
    
    
    
    
    
    
    
    (486
    )
    
    
    (520
    )Derivatives not designated
as hedging
instruments under SFAS 133Embedded credit derivatives
    
    Other assets
    
    
    2,616
    
    
    
    2,095
    
    
    
    
    
    
    
    Stock warrants
    
    Other assets
    
    
    878
    
    
    
    878
    
    
    
    
    
    
    
    3,494
    
    
    
    2,973
    
    
    
    
    
    
    
    Total derivatives
    
    
    
    $
    3,532
    
    
    $
    2,973
    
    
    $
    (486
    )
    
    $
    (520
    )
 CPA ® :16  Global 3/31/2009 10-Q 13




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##### Table of Contents



Notes to Consolidated Financial Statements
  Amount of Gain (Loss) Recognized in
    
    
    Amount of Gain (Loss) Reclassified fromOCI on Derivative (Effective Portion)
    
    
    OCI into Income (Effective Portion)Derivatives in SFAS 133 Cash Flow Hedging
    
    Three months ended March 31,
    
    
    Three months ended March 31,Relationships
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008Interest rate caps (a) (b)
    
    $
    20
    
    
    $
    
    
    
    $
    
    
    
    $
    Interest rate swaps (a)
    
    
    34
    
    
    
    (376
    )
    
    
    
    
    
    
    Foreign currency forward contracts (a) (c)
    
    
    18
    
    
    
    
    
    
    
    27
    
    
    
    Total
    
    $
    72
    
    
    $
    (376
    )
    
    $
    27
    
    
    $
    
 
 (a)
    
    During the three months ended March 31, 2009 and 2008, no gains or losses were reclassified
from Other comprehensive income into income related to ineffective portions of hedging
relationships or to amounts excluded from effectiveness testing.(b)
    
    Includes gains attributable to noncontrolling interests totaling less than $0.1 million for
the three months ended March 31, 2009. We obtained this interest rate cap in March 2009.(c)
    
    Gains (losses) reclassified from Other comprehensive income into income are included in Other
income and expenses. Amount of Gain Recognized inIncome on DerivativesDerivatives not in SFAS 133 Cash
    
    
    
    Three months ended March 31,Flow Hedging Relationships
    
    Location of Gain Recognized in Income
    
    2009
    
    
    2008Embedded credit derivatives (a)
    
    Other income and expenses
    
    $
    647
    
    
    $
    1,408Stock warrants
    
    Other income and expenses
    
    
    
    
    
    
    27Total
    
    
    
    $
    647
    
    
    $
    1,435
 
 (a)
    
    Includes gains attributable to noncontrolling interests totaling $0.5 million and $1 million
for the three months ended March 31, 2009 and 2008, respectively.  Interest Rate Caps and Swaps
   Notional
    
    
    Effective
    
    
    Effective
    
    
    Expiration
    
    
    Fair Value atType
    
    Amount
    
    
    Interest Rate
    
    
    Date
    
    
    Date
    
    
    March 31, 20091-Month LIBOR
    
    Interest rate cap (a)
    
    
    29,000
    
    
    
    5.0
    %
    
    
    3/2009
    
    
    
    3/2012
    
    
    $
    201-Month LIBOR
    
    Pay-fixed swap
    
    
    4,000
    
    
    
    6.7
    %
    
    
    2/2008
    
    
    
    2/2018
    
    
    
    (486
    )$
    (466
    )
 
 (a)
    
    In February 2009, a venture in which we own a 50% interest and which we consolidate, repaid a
$39 million outstanding balance on a non-recourse mortgage loan at a discount for $32.5
million and recognized a corresponding gain of $6.5 million. In connection with this
transaction, the venture obtained non-recourse mortgage financing of approximately $29
million. The new CPA ® :16  Global 3/31/2009 10-Q 14




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##### Table of Contents



Notes to Consolidated Financial Statements
 debt has an annual interest rate of LIBOR plus 5%, with a minimum rate of 6%
and a maximum rate that has been capped at 10% through the use of an interest rate cap. This
financing has a term of three years, with two one-year extensions. The applicable interest
rate of the related debt was 6% at March 31, 2009, and therefore the interest rate cap was not
in effect at that date.  Foreign Currency Forward Contracts
   Embedded Credit Derivatives
  Stock Warrants
  Other
   Concentration of Credit Risk
   CPA ® :16  Global 3/31/2009 10-Q 15




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##### Table of Contents



Notes to Consolidated Financial Statements
    Note 9. Noncontrolling Interests
   CPA®:16  Global
    
    
    NoncontrollingTotal
    
    
    Shareholders
    
    
    InterestsBalance at January 1, 2008
    
    $
    1,094,653
    
    
    $
    1,021,097
    
    
    $
    73,556Shares issued
    
    
    44,633
    
    
    
    44,633
    
    
    
    Contributions
    
    
    24,396
    
    
    
    
    
    
    
    24,396Net income
    
    
    19,208
    
    
    
    20,262
    
    
    
    (1,054
    )Distributions
    
    
    (86,446
    )
    
    
    (79,719
    )
    
    
    (6,727
    )Change in other comprehensive income (loss)
    
    
    (33,227
    )
    
    
    (29,765
    )
    
    
    (3,462
    )Shares repurchased
    
    
    (16,612
    )
    
    
    (16,612
    )
    
    
    Balance at January 1, 2009
    
    
    1,046,605
    
    
    
    959,896
    
    
    
    86,709Shares issued
    
    
    11,374
    
    
    
    11,374
    
    
    
    Contributions
    
    
    2,543
    
    
    
    
    
    
    
    2,543Net income
    
    
    (3,462
    )
    
    
    (7,645
    )
    
    
    4,183Distributions
    
    
    (26,393
    )
    
    
    (20,169
    )
    
    
    (6,224
    )Change in other comprehensive income (loss)
    
    
    (21,301
    )
    
    
    (17,345
    )
    
    
    (3,956
    )Shares repurchased
    
    
    (11,332
    )
    
    
    (11,332
    )
    
    
    Balance at March 31, 2009
    
    $
    998,034
    
    
    $
    914,779
    
    
    $
    83,255
 Redeemable Noncontrolling Interests
  CPA ® :16  Global 3/31/2009 10-Q 16




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##### Table of Contents



Notes to Consolidated Financial Statements
  Balance at January 1, 2008
    
    $
    346,718Foreign currency translation adjustment
    
    
    (14,877
    )Balance at January 1, 2009
    
    
    331,841Foreign currency translation adjustment
    
    
    (20,927
    )Balance at March 31, 2009
    
    $
    310,914
 Note 10. Income Taxes
     CPA ® :16  Global 3/31/2009 10-Q 17




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Business Overview
  Highlights
 Highlights during the first quarter of 2009
 
    
    Acquired investments totaling $69.3 million, comprised of $64.2 million for
The New York Times Company transaction and $5.1 million for a domestic build-to-suit
project.
    
    Incurred an impairment charge of $16 million on a domestic investment.
    
    Repaid the $39 million outstanding balance on a non-recourse mortgage loan at a discount
for $32.5 million and recognized a corresponding gain of $6.5 million, inclusive of
noncontrolling interest of $3.2 million. Concurrent with this repayment, we obtained new
non-recourse debt of $29 million with a term of three years, plus two one-year extensions.
    
    Our quarterly cash distribution increased to $0.1653 per share for the first quarter of
2009, or $0.66 per share on an annualized basis.
 Financial Highlights
 Three months ended March 31,2009
    
    2008Total revenues
    
    $
    57,413
    
    
    $
    56,258Net (loss) income attributable to CPA®:16  Global shareholders(a)
    
    
    (7,645
    )
    
    
    5,812Cash flow from operating activities
    
    
    26,162
    
    
    
    27,469
 
 (a)
    
    Net loss attributable to CPA®:16  Global shareholders for the three months ended
March 31, 2009 reflected the recognition of the $16 million impairment charge.  CPA ® :16  Global 3/31/2009 10-Q 18




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##### Table of Contents



Current Trends
   Financing Conditions
   Net Asset Values
   Corporate Defaults
  CPA ® :16  Global 3/31/2009 10-Q 19




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##### Table of Contents



Redemptions
  Consumer Price Index (CPI)
  Exchange Rate Movements
  Results of Operations
  Three months ended March 31,2009
    
    
    2008Rental income
    
    $
    37,555
    
    
    $
    36,781Interest income from direct financing leases
    
    
    6,663
    
    
    
    7,081$
    44,218
    
    
    $
    43,862
 CPA ® :16  Global 3/31/2009 10-Q 20




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##### Table of Contents



Three months ended March 31,Lessee
    
    2009
    
    
    2008Hellweg Die Profi-Baumarkte GmbH & Co. KG (Hellweg 2) (a) (b) (c)
    
    $
    8,342
    
    
    $
    9,349Telcordia Technologies, Inc.
    
    
    2,342
    
    
    
    2,296Berry Plastics Corporation
    
    
    1,660
    
    
    
    1,671Nordic Cold Storage LLC
    
    
    1,624
    
    
    
    1,564Fraikin SAS (b)
    
    
    1,395
    
    
    
    1,587The Talaria Company (Hinckley) (c)
    
    
    1,244
    
    
    
    1,247MetoKote Corp., MetoKote Canada Limited and MetoKote de Mexico(b) (d) (e)
    
    
    1,145
    
    
    
    1,024International Aluminum Corp. and United States Aluminum of Canada Ltd. (b)
    
    
    1,129
    
    
    
    1,096Huntsman International, LLC
    
    
    1,006
    
    
    
    1,006Best Brands Corp. (f)
    
    
    988
    
    
    
    Ply Gem Industries, Inc. (b)
    
    
    959
    
    
    
    959LFD Manufacturing Ltd., IDS Logistics (Thailand) Ltd. and IDS Manufacturing SDN BHD (b)
    
    
    940
    
    
    
    966Gortz & Schiele GmbH & Co. and Goertz & Schiele Corporation (b) (c) (e)
(g)
    
    
    896
    
    
    
    913Holopack International Corp.
    
    
    893
    
    
    
    893TRW Vehicle Safety Systems Inc. (e)
    
    
    892
    
    
    
    892Bobs Discount Furniture, LLC
    
    
    860
    
    
    
    878Foss Manufacturing Company, LLC
    
    
    857
    
    
    
    866Universal Technical Institute of California, Inc.
    
    
    836
    
    
    
    845Kings Super Markets Inc.
    
    
    835
    
    
    
    845Finisar Corporation
    
    
    805
    
    
    
    803Performance Fibers GmbH(b)
    
    
    804
    
    
    
    904Dicks Sporting Goods, Inc. (c)
    
    
    784
    
    
    
    784Willy Voit GmbH & Co. Stanz-und Metallwerk (b) (e)
    
    
    632
    
    
    
    725Other (b) (d) (e)
    
    
    12,350
    
    
    
    11,749$
    44,218
    
    
    $
    43,862
 
 (a)
    
    We also own an equity investment in other properties leased to this tenant through a 2005
transaction.(b)
    
    Amounts are subject to fluctuations in foreign currency exchange rates.(c)
    
    These revenues are generated in consolidated joint ventures, generally with affiliates, and
include lease revenues applicable to noncontrolling interests totaling $9.9 million and $10
million for the three months ended March 31, 2009 and 2008, respectively.(d)
    
    Increase was due to CPI-based (or equivalent) rent increase.(e)
    
    Tenant operates in the automotive industry. Included in Other are lease revenues from two
additional tenants operating in the automotive industry totaling $0.7 million and $0.9 million
for the three months ended March 31, 2009 and 2008, respectively.(f)
    
    We acquired our interest in this investment during 2008.(g)
    
    This tenant filed for bankruptcy protection in Germany in November 2008. CPA ® :16  Global 3/31/2009 10-Q 21




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##### Table of Contents



Ownership Interest at
    
    
    Three months ended March 31,Lessee
    
    March 31, 2009
    
    
    2009
    
    
    2008U-Haul Moving Partners, Inc. and Mercury Partners, L.P.
    
    
    31
    %
    
    $
    7,136
    
    
    $
    7,136OBI A.G. (a)
    
    
    25
    %
    
    
    3,908
    
    
    
    4,410Hellweg Die Profi-Baumarkte GmbH & Co. KG (Hellweg 1) (a)
    
    
    25
    %
    
    
    3,430
    
    
    
    3,861Thales S.A. (a)
    
    
    35
    %
    
    
    3,342
    
    
    
    3,624Pohjola Non-life Insurance Company(a)
    
    
    40
    %
    
    
    2,120
    
    
    
    2,352TietoEnator Plc (a)
    
    
    40
    %
    
    
    1,980
    
    
    
    2,213The New York Times Company (b)
    
    
    27
    %
    
    
    1,850
    
    
    
    Police Prefecture, French Government (a)
    
    
    50
    %
    
    
    1,843
    
    
    
    2,018Schuler A.G. (a)
    
    
    33
    %
    
    
    1,520
    
    
    
    1,720Frontier Spinning Mills, Inc. (c)
    
    
    40
    %
    
    
    1,109
    
    
    
    Actebis Peacock GmbH (a) (c)
    
    
    30
    %
    
    
    949
    
    
    
    Lindenmaier A.G. (a) (d)
    
    
    33
    %
    
    
    603
    
    
    
    666Consolidated Systems, Inc.
    
    
    40
    %
    
    
    449
    
    
    
    453Actuant Corporation(a)
    
    
    50
    %
    
    
    423
    
    
    
    483$
    30,662
    
    
    $
    28,936
 
 (a)
    
    Revenue amounts are subject to fluctuations in foreign currency exchange rates.(b)
    
    We acquired our interest in this investment during 2009.(c)
    
    We acquired our interest in this investment during 2008.(d)
    
    Tenant operates in the automotive industry and is currently operating under bankruptcy protection.  Lease Revenues
   Interest Income on Notes Receivable
  CPA ® :16  Global 3/31/2009 10-Q 22




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##### Table of Contents



Other Real Estate Income
   Property Expenses
  Other Real Estate Expenses
   General and Administrative
  Impairment Charge
  Income from Equity Investments in Real Estate
   Other Interest Income
  Gain on extinguishment of Debt
  Other Income and Expenses
  CPA ® :16  Global 3/31/2009 10-Q 23




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##### Table of Contents



Provision for Income Taxes
  Noncontrolling Interests in Income
   Net (Loss) Income Attributable to CPA ® :16  Global Shareholders
 ® ®
 Financial Condition
 Sources and Uses of Cash During the Period
   Operating Activities
 Investing Activities
 CPA ® :16  Global 3/31/2009 10-Q 24




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##### Table of Contents



Financing Activities
  Summary of Financing
  March 31,2009
    
    
    2008BalanceFixed rate
    
    $
    1,327,363
    
    
    $
    1,491,015Variable rate (a)
    
    
    58,478
    
    
    
    35,988Total
    
    $
    1,385,841
    
    
    $
    1,527,003Percent of total debtFixed rate
    
    
    96
    %
    
    
    98
    %Variable rate (a)
    
    
    4
    %
    
    
    2
    %100
    %
    
    
    100
    %Weighted average interest rate at end of periodFixed rate
    
    
    5.9
    %
    
    
    5.4
    %Variable rate (a)
    
    
    5.7
    %
    
    
    4.9
    %
 
 (a)
    
    Included in variable rate debt at March 31, 2009 is (i) $3.9 million that has been
effectively converted to fixed rates through interest rate swap derivative instruments, (ii)
$29 million in variable rate debt that is subject to an interest rate cap, but for which the
interest rate cap was not in effect at March 31, 2009 and (iii) $25.5 million in mortgage
obligations that bore interest at a fixed rate but that have interest rate reset features that
may change the interest rates to then prevailing market fixed rates at certain
points in their term. No interest rate resets or expirations of interest rate swaps are
scheduled to occur during the next twelve months. CPA ® :16  Global 3/31/2009 10-Q 25




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##### Table of Contents



Cash Resources
  Cash Requirements
  Off-Balance Sheet Arrangements and Contractual Obligations
  Less than
    
    
    
    
    
    
    
    
    
    
    More thanTotal
    
    
    1 year
    
    
    13 years
    
    
    35 years
    
    
    5 yearsNon-recourse debt  Principal
    
    $
    1,385,841
    
    
    $
    19,152
    
    
    $
    76,484
    
    
    $
    58,096
    
    
    $
    1,232,109Deferred acquisition fees  Principal
    
    
    16,599
    
    
    
    9,082
    
    
    
    7,517
    
    
    
    
    
    
    
    Interest on borrowings and deferred acquisition
fees (a)
    
    
    661,531
    
    
    
    81,558
    
    
    
    159,778
    
    
    
    149,618
    
    
    
    270,577Build-to-suit commitments (b)
    
    
    6,026
    
    
    
    6,026
    
    
    
    
    
    
    
    
    
    
    
    Lending commitments (c)
    
    
    29,688
    
    
    
    29,688
    
    
    
    
    
    
    
    
    
    
    
    Operating and other lease commitments (d)
    
    
    57,464
    
    
    
    1,721
    
    
    
    3,492
    
    
    
    3,556
    
    
    
    48,695$
    2,157,149
    
    
    $
    147,227
    
    
    $
    247,271
    
    
    $
    211,270
    
    
    $
    1,551,381
 
 (a)
    
    Interest on an unhedged variable rate debt obligation was calculated using the applicable
variable interest rate and balance outstanding as of March 31, 2009.(b)
    
    Represents remaining build-to-suit commitments for two projects. Estimated total
construction costs for the first project are currently projected to be $5.3 million, of which
none was funded as of March 31, 2009. Estimated total construction costs for the second
project are currently projected to be $4.9 million, of which $4.1 million was funded as of
March 31, 2009.(c)
    
    Represents unfunded amounts on an ADC equity arrangement and a commitment to provide a loan
to a developer of a domestic property. The total commitments for the ADC equity arrangement
and the loan are $62.5 million and $15.8 million, respectively, of which $38 million and $10.7
million had been funded as of March 31, 2009, respectively.(d)
    
    Operating and other lease commitments consist primarily of rent obligations under ground
leases and 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. Amounts under the cost-sharing agreement are allocated among the
entities based on gross revenues and are adjusted quarterly. Rental obligations under ground
leases are inclusive of noncontrolling interests of approximately $8.7 million.  
 CPA ® :16  Global 3/31/2009 10-Q 26




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##### Table of Contents



Ownership
    
    
    
    
    
    
    Total ThirdLessee
    
    Interest
    
    
    Total Assets
    
    
    Party Debt
    
    
    Maturity DateThales S.A. (a)
    
    
    35
    %
    
    $
    49,999
    
    
    $
    71,080
    
    
    
    7/2011U-Haul Moving Partners, Inc. and Mercury Partners, LP
    
    
    31
    %
    
    
    305,237
    
    
    
    167,220
    
    
    
    5/2014Actuant Corporation (a)
    
    
    50
    %
    
    
    14,931
    
    
    
    11,276
    
    
    
    5/2014TietoEnator Plc(a)
    
    
    40
    %
    
    
    112,393
    
    
    
    70,998
    
    
    
    7/2014Pohjola Non-life Insurance Company (a)
    
    
    40
    %
    
    
    50,462
    
    
    
    79,774
    
    
    
    1/2015Hellweg Die Profi-Baumarkte GmbH & Co. KG (Hellweg 1) (a)
    
    
    25
    %
    
    
    170,956
    
    
    
    105,862
    
    
    
    5/2015Actebis Peacock GmbH (a)
    
    
    30
    %
    
    
    49,577
    
    
    
    29,881
    
    
    
    7/2015Consolidated Systems, Inc.
    
    
    40
    %
    
    
    17,541
    
    
    
    11,656
    
    
    
    11/2016Lindenmaier A.G. (a)
    
    
    33
    %
    
    
    28,816
    
    
    
    11,752
    
    
    
    10/2017OBI A.G. (a)
    
    
    25
    %
    
    
    193,099
    
    
    
    159,889
    
    
    
    3/2018Police Prefecture, French Government (a)
    
    
    50
    %
    
    
    113,895
    
    
    
    84,071
    
    
    
    8/2020The New York Times Company (b)
    
    
    27
    %
    
    
    233,847
    
    
    
    
    
    
    
    N/ASchuler A.G. (a)
    
    
    33
    %
    
    
    70,927
    
    
    
    
    
    
    
    N/AFrontier Spinning Mills, Inc.
    
    
    40
    %
    
    
    39,987
    
    
    
    
    
    
    
    N/ASoho House Beach House LLC (c)
    
    
    N/A
    
    
    
    54,989
    
    
    
    
    
    
    
    N/A$
    1,506,656
    
    
    $
    803,459
 
 (a)
    
    Dollar amounts are based on the applicable exchange rate as of March 31, 2009.(b)
    
    We acquired our interest in this investment during the three months ended March 31, 2009.(c)
    
    We account for this investment under the equity method of accounting as it constitutes an ADC
equity arrangement. 
 CPA ® :16  Global 3/31/2009 10-Q 27




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
 Market Risks
   Interest Rate Risk
       2009
    
    2010
    
    2011
    
    2012
    
    2013
    
    Thereafter
    
    Total
    
    Fair valueFixed rate debt
    
    $
    13,613
    
    
    $
    21,200
    
    
    $
    24,183
    
    
    $
    26,543
    
    
    $
    29,243
    
    
    $
    1,212,581
    
    
    $
    1,327,363
    
    
    $
    1,113,971Variable rate debt
    
    $
    293
    
    
    $
    395
    
    
    $
    400
    
    
    $
    29,404
    
    
    $
    411
    
    
    $
    27,575
    
    
    $
    58,478
    
    
    $
    55,103
 CPA ® :16  Global 3/31/2009 10-Q 28




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##### Table of Contents



Foreign Currency Exchange Rate Risk
    Other
  
 Item 4T. Controls and Procedures
 Disclosure Controls and Procedures
   Changes in Internal Control over Financial Reporting
  CPA ® :16  Global 3/31/2009 10-Q 29




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##### Table of Contents



PART II
 
 Item 2. Unregistered Sales of Equity Securities
   Issuer Purchases of Equity Securities:
 Maximum number (orTotal number of shares
    
    approximate dollar value)purchased as part of
    
    of shares that may yet beTotal number of
    
    Average price
    
    publicly announced
    
    purchased under the2009 Period
    
    shares purchased(a)
    
    paid per share
    
    plans or programs(a)
    
    plans or programs(a)January
    
    
    
    
    
    $
    
    
    
    
    N/A
    
    
    
    N/AFebruary
    
    
    9,095
    
    
    
    9.11
    
    
    
    N/A
    
    
    
    N/AMarch
    
    
    1,234,016
    
    
    
    9.11
    
    
    
    N/A
    
    
    
    N/ATotal
    
    
    1,243,111
 
 (a)
    
    Represents shares of our common stock purchased pursuant to our redemption plan. In December
2003, we announced a redemption plan under which we may elect to redeem shares at the request
of our shareholders, subject to certain conditions and limitations. The maximum amount of
shares purchasable by us in any period depends on a number of
factors and is at the discretion of our
board of directors. The redemption plan will terminate if and when our shares are listed on a
national securities market. 
 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
    
    Filed herewiththe Sarbanes-Oxley Act of 2002.
 CPA ® :16  Global 3/31/2009 10-Q 30




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##### Table of Contents



SIGNATURES
  Corporate Property Associates 16  Global IncorporatedDate 5/15/2009
    By:
    /s/ Mark J. DeCesarisMark J. DeCesarisManaging Director and Acting Chief Financial Officer

(Principal Financial Officer)Date 5/15/2009
    By:
    /s/ Thomas J. Ridings, Jr.Thomas J. Ridings, Jr.Executive Director and Chief Accounting Officer
(Principal Accounting Officer) CPA ® :16  Global 3/31/2009 10-Q 31