##### 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 September 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




---



##### 



INDEX
 Page No.PART I  FINANCIAL INFORMATIONItem 1.  Financial Statements*Consolidated Balance Sheets as of September 30, 2007 and December 31, 2006
    
    
    2Consolidated Statements of Income for the three and nine months ended September 30, 2007 and 2006
    
    
    3Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2007 and 2006
    
    
    3Consolidated Statement of Shareholders Equity for the nine months ended September 30, 2007
    
    
    4Consolidated Statements of Cash Flows for the nine months ended September 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
    
    
    27Item 4T.  Controls and Procedures
    
    
    28PART II  OTHER INFORMATIONItem 2.  Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    29Item 6.  Exhibits
    
    
    29Signatures
    
    
    30EX-10.1: AMENDED AND RESTATED ADVISORY AGREEMENTEX-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 9/30/2007 10-Q  1




---



##### 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)
 September 30, 2007
    
    
    December 31, 2006(NOTE)AssetsReal estate, net
    
    $
    1,468,290
    
    
    $
    648,593Net investment in direct financing leases
    
    
    366,964
    
    
    
    308,073Equity investments in real estate
    
    
    142,899
    
    
    
    111,870Real estate under construction
    
    
    40,810
    
    
    
    75,372Notes receivable
    
    
    369,138
    
    
    
    9,603Cash and cash equivalents
    
    
    338,377
    
    
    
    464,223Intangible assets, net
    
    
    157,244
    
    
    
    108,001Funds in escrow
    
    
    120,497
    
    
    
    10,115Other assets, net
    
    
    64,027
    
    
    
    39,790Total assets
    
    $
    3,068,246
    
    
    $
    1,775,640Liabilities and Shareholders EquityLiabilities:Limited recourse mortgage notes payable
    
    $
    1,368,894
    
    
    $
    630,795Note payable
    
    
    4,615
    
    
    
    3,450Accounts payable, accrued expenses and other liabilities
    
    
    103,472
    
    
    
    19,181Prepaid and deferred rental income and security deposits
    
    
    93,031
    
    
    
    34,749Due to affiliates
    
    
    47,200
    
    
    
    49,219Distributions payable
    
    
    19,185
    
    
    
    16,067Total liabilities
    
    
    1,636,397
    
    
    
    753,461Minority interest in consolidated entities
    
    
    411,754
    
    
    
    31,358Commitments and contingencies (Note 9)Shareholders equity:Common stock, $0.001 par value; 250,000,000 shares authorized;
119,215,556 and 114,701,851 shares issued and outstanding, respectively
    
    
    119
    
    
    
    115Additional paid-in capital
    
    
    1,072,417
    
    
    
    1,028,933Distributions in excess of accumulated earnings
    
    
    (65,551
    )
    
    
    (40,679
    )Accumulated other comprehensive income
    
    
    25,209
    
    
    
    9,0901,032,194
    
    
    
    997,459Less, treasury stock at cost, 1,300,767 and 713,803 shares, respectively
    
    
    (12,099
    )
    
    
    (6,638
    )Total shareholders equity
    
    
    1,020,095
    
    
    
    990,821Total liabilities and shareholders equity
    
    $
    3,068,246
    
    
    $
    1,775,640
   CPA ® :16  Global 9/30/2007 10-Q  2




---



##### 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 September 30,
    
    
    Nine months ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006RevenuesRental income
    
    $
    32,073
    
    
    $
    12,723
    
    
    $
    79,344
    
    
    $
    34,876Interest income from direct financing leases
    
    
    6,814
    
    
    
    4,413
    
    
    
    19,428
    
    
    
    10,935Interest income on notes receivable
    
    
    6,784
    
    
    
    356
    
    
    
    13,400
    
    
    
    1,722Other operating income
    
    
    582
    
    
    
    223
    
    
    
    1,052
    
    
    
    96646,253
    
    
    
    17,715
    
    
    
    113,224
    
    
    
    48,499Operating ExpensesDepreciation and amortization
    
    
    (8,926
    )
    
    
    (3,436
    )
    
    
    (22,673
    )
    
    
    (9,202
    )Property expenses
    
    
    (5,603
    )
    
    
    (3,494
    )
    
    
    (14,773
    )
    
    
    (9,166
    )General and administrative
    
    
    (2,959
    )
    
    
    (1,028
    )
    
    
    (6,178
    )
    
    
    (3,121
    )(17,488
    )
    
    
    (7,958
    )
    
    
    (43,624
    )
    
    
    (21,489
    )Other Income and ExpensesIncome from equity investments in real estate
    
    
    2,434
    
    
    
    1,776
    
    
    
    5,705
    
    
    
    5,256Other interest income
    
    
    4,542
    
    
    
    3,399
    
    
    
    16,861
    
    
    
    6,830Minority interest in income
    
    
    (11,656
    )
    
    
    (468
    )
    
    
    (18,282
    )
    
    
    (1,459
    )Gain on foreign currency transactions,
derivative instruments
and other, net
    
    
    6,211
    
    
    
    163
    
    
    
    6,529
    
    
    
    229Interest expense
    
    
    (18,740
    )
    
    
    (6,837
    )
    
    
    (46,107
    )
    
    
    (17,947
    )(17,209
    )
    
    
    (1,967
    )
    
    
    (35,294
    )
    
    
    (7,091
    )Income before income taxes
    
    
    11,556
    
    
    
    7,790
    
    
    
    34,306
    
    
    
    19,919Provision for income taxes
    
    
    (1,194
    )
    
    
    (35
    )
    
    
    (2,603
    )
    
    
    (315
    )Net Income
    
    $
    10,362
    
    
    $
    7,755
    
    
    $
    31,703
    
    
    $
    19,604Earnings Per Share
    
    $
    0.08
    
    
    $
    0.10
    
    
    $
    0.27
    
    
    $
    0.29Weighted Average Shares Outstanding
    
    
    117,570,074
    
    
    
    81,569,191
    
    
    
    115,934,112
    
    
    
    67,911,308Distributions Declared Per Share
    
    $
    0.1627
    
    
    $
    0.1601
    
    
    $
    0.4866
    
    
    $
    0.4764
  
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)  (in thousands)
 Three months ended September 30,
    
    
    Nine months ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Net income
    
    $
    10,362
    
    
    $
    7,755
    
    
    $
    31,703
    
    
    $
    19,604Other comprehensive incomeChange in unrealized gain on marketable securities
    
    
    114
    
    
    
    70
    
    
    
    9
    
    
    
    67Foreign currency translation adjustment
    
    
    9,821
    
    
    
    2,197
    
    
    
    14,596
    
    
    
    6,746Change in unrealized (loss) gain on derivative instruments
    
    
    (445
    )
    
    
    (1,116
    )
    
    
    1,514
    
    
    
    1319,490
    
    
    
    1,151
    
    
    
    16,119
    
    
    
    6,944Comprehensive income
    
    $
    19,852
    
    
    $
    8,906
    
    
    $
    47,822
    
    
    $
    26,548
  CPA ® :16  Global 9/30/2007 10-Q  3




---



##### Table of Contents



CORPORATE PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 CONSOLIDATED STATEMENT OF SHAREHOLDERS EQUITY (UNAUDITED)
For the nine months ended September 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
    
    
    2,480,630
    
    
    
    2
    
    
    
    23,153
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23,155Shares, $.001 par, issued to the
advisor at $10 per share
    
    
    2,033,075
    
    
    
    2
    
    
    
    20,331
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,333Distributions declared
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (56,485
    )
    
    
    
    
    
    
    
    
    
    
    (56,485
    )Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,703
    
    
    
    
    
    
    
    
    
    
    
    31,703Change in other comprehensive
income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,119
    
    
    
    
    
    
    
    16,119Repurchase of shares
    
    
    (586,964
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,461
    )
    
    
    (5,461
    )Balance at September 30, 2007
    
    
    117,914,789
    
    
    $
    119
    
    
    $
    1,072,417
    
    
    $
    (65,551
    )
    
    $
    25,209
    
    
    $
    (12,099
    )
    
    $
    1,020,095
  CPA ® :16  Global 9/30/2007 10-Q  4




---



##### Table of Contents



CORPORATE PROPERTY ASSOCIATES 16  GLOBAL INCORPORATED
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)  (in thousands)
 Nine months ended September 30,2007
    
    
    2006Cash Flows  Operating ActivitiesNet income
    
    $
    31,703
    
    
    $
    19,604Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization including intangible assets and deferred financing costs
    
    
    22,862
    
    
    
    9,436Straight-line rent adjustments and amortization of rent-related intangibles
    
    
    (33
    )
    
    
    (1,354
    )Income from equity investments in real estate in excess of distributions received
    
    
    (1,768
    )
    
    
    (1,338
    )Minority interest in income
    
    
    18,282
    
    
    
    1,459Issuance of shares to affiliate in satisfaction of fees due
    
    
    20,333
    
    
    
    3,857Realized gain on foreign currency transactions, net
    
    
    (320
    )
    
    
    (399
    )Unrealized (gain) loss on foreign currency and derivative transactions, net
    
    
    (6,209
    )
    
    
    4Increase in accrued interest
    
    
    6,957
    
    
    
    549(Decrease) increase in due to affiliates
    
    
    (6,670
    )
    
    
    4,902Change in other operating assets and liabilities, net
    
    
    4,857
    
    
    
    745Net cash provided by operating activities
    
    
    89,994
    
    
    
    37,465Cash Flows  Investing ActivitiesDistributions from equity investments in real estate in excess of equity income
    
    
    1,885
    
    
    
    3,420Acquisitions of real estate and other capital expenditures
    
    
    (531,469
    )
    
    
    (215,902
    )Purchases of notes receivable
    
    
    (337,764
    )
    
    
    Contributions to equity investments in real estate
    
    
    (24,818
    )
    
    
    (10,088
    )Funds placed in escrow for future acquisition and construction of real estate
    
    
    (19,188
    )
    
    
    (28,419
    )Release of funds held in escrow for acquisition and construction of real estate
    
    
    4,084
    
    
    
    26,454VAT taxes (paid) recovered in connection with acquisitions of real estate
    
    
    (885
    )
    
    
    4,008Proceeds from maturity of short-term investment
    
    
    1,698
    
    
    
    Receipt of principal payment of mortgage note receivable
    
    
    215
    
    
    
    206Receipt of principal prepayment of mortgage note receivable
    
    
    
    
    
    
    20,000Net cash used in investing activities
    
    
    (906,242
    )
    
    
    (200,321
    )Cash Flows  Financing ActivitiesDistributions paid
    
    
    (53,367
    )
    
    
    (28,328
    )Distributions paid to minority interest partners
    
    
    (296,838
    )
    
    
    (1,220
    )Contributions from minority interest partners
    
    
    319,773
    
    
    
    Proceeds from mortgages and notes payable
    
    
    710,965
    
    
    
    119,744Scheduled payments of mortgage principal
    
    
    (7,845
    )
    
    
    (4,571
    )Deferred financing costs and mortgage deposits, net of deposits refunded
    
    
    (463
    )
    
    
    (1,356
    )Proceeds from issuance of shares, net of costs of raising capital
    
    
    23,155
    
    
    
    258,319Purchase of treasury stock
    
    
    (5,461
    )
    
    
    (3,717
    )Net cash provided by financing activities
    
    
    689,919
    
    
    
    338,871Change in Cash and Cash Equivalents During the PeriodEffect of exchange rate changes on cash
    
    
    483
    
    
    
    80Net (decrease) increase in cash and cash equivalents
    
    
    (125,846
    )
    
    
    176,095Cash and cash equivalents, beginning of period
    
    
    464,223
    
    
    
    155,374Cash and cash equivalents, end of period
    
    $
    338,377
    
    
    $
    331,469
  CPA ® :16  Global  5




---



##### 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
    CPA®:16  Global 9/30/2007 10-Q  6




---



##### Table of Contents



Notes to Consolidated Financial Statements
 Information about International Geographic Areas
  Three months ended September 30,
    
    
    Nine months ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Lease revenues (rental income and
interest income on direct financing leases)
    
    $
    16,267
    
    
    $
    3,928
    
    
    $
    38,062
    
    
    $
    10,209Interest income on notes receivable
    
    
    6,478
    
    
    
    
    
    
    
    12,609
    
    
    
    Income from equity investments in real estate
    
    
    1,679
    
    
    
    1,052
    
    
    
    3,345
    
    
    
    3,067As ofSeptember 30, 2007
    
    
    December 31, 2006Long-lived assets
    
    
    
    
    
    
    
    
    
    $
    1,198,340
    
    
    $
    329,079Notes receivable
    
    
    
    
    
    
    
    
    
    
    333,961
    
    
    
    Equity investments in real estate
    
    
    
    
    
    
    
    
    
    
    104,412
    
    
    
    73,452
 Reclassifications
  Out-of-Period Adjustment
  Adoption of New Accounting Pronouncements
 SFAS 155
  FIN 48
  Recent Accounting Pronouncements
 SFAS 157
  SFAS 159
  CPA®:16  Global 9/30/2007 10-Q  7




---



##### Table of Contents



Notes to Consolidated Financial Statements
  SOP 07-1
 FIN 46(R)-7
 Note 3. Organization and Offerings
   Note 4. Agreements and Transactions with Related Parties
  CPA®:16  Global 9/30/2007 10-Q  8




---



##### Table of Contents



Notes to Consolidated Financial Statements
 st
     Note 5. Real Estate
  September 30, 2007
    
    
    December 31, 2006Cost
    
    $
    1,502,304
    
    
    $
    663,810Less: Accumulated depreciation
    
    
    (34,014
    )
    
    
    (15,217
    )$
    1,468,290
    
    
    $
    648,593
 Note 6. Equity Investments in Real Estate
  CPA®:16  Global 9/30/2007 10-Q  9




---



##### Table of Contents



Notes to Consolidated Financial Statements
  Ownership Interest at
    
    
    Carrying ValueLessee
    
    September 30, 2007
    
    
    September 30, 2007
    
    
    December 31, 2006U-Haul Moving Partners, Inc. and Mercury Partners, LP
    
    
    30.77
    %
    
    $
    36,226
    
    
    $
    36,150Schuler A.G. (1)
    
    
    33.33
    %
    
    
    24,561
    
    
    
    Hellweg Die Profi-Baumarkte GmbH & Co. KG (2)
    
    
    25
    %
    
    
    17,525
    
    
    
    15,397Police Prefecture, French Government
    
    
    50
    %
    
    
    14,278
    
    
    
    14,020OBI A.G. (1)
    
    
    25
    %
    
    
    13,183
    
    
    
    10,750Thales S.A.
    
    
    35
    %
    
    
    11,342
    
    
    
    10,355TietoEnator Plc
    
    
    40
    %
    
    
    10,352
    
    
    
    9,918Pohjola Non-life Insurance Company
    
    
    40
    %
    
    
    10,311
    
    
    
    10,128Actuant Corporation
    
    
    50
    %
    
    
    2,861
    
    
    
    2,883Consolidated Systems, Inc.
    
    
    40
    %
    
    
    2,260
    
    
    
    2,269$
    142,899
    
    
    $
    111,870
 
 (1)
    
    We acquired all or part of our interest in this investment during 2007 (Note 7).(2)
    
    In April 2007, we acquired an interest in a second transaction with Hellweg which we
consolidate (Note 7). ® ®
  September 30, 2007
    
    
    December 31, 2006Assets
    
    
    
    
    
    
    
    
    
    $
    306,349
    
    
    $
    311,116Liabilities
    
    
    
    
    
    
    
    
    
    
    (189,206
    )
    
    
    (194,281
    )Partners equity
    
    
    
    
    
    
    
    
    
    $
    117,143
    
    
    $
    116,835Three months ended September 30,
    
    
    Nine months ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Revenue
    
    $
    7,142
    
    
    $
    7,145
    
    
    $
    21,351
    
    
    $
    21,437Expenses
    
    
    (4,864
    )
    
    
    (4,771
    )
    
    
    (14,213
    )
    
    
    (14,263
    )Net income
    
    $
    2,278
    
    
    $
    2,374
    
    
    $
    7,138
    
    
    $
    7,174Our share of income
from equity
investments in real
estate
    
    $
    695
    
    
    $
    724
    
    
    $
    2,178
    
    
    $
    2,189
  September 30, 2007
    
    
    December 31, 2006Assets
    
    
    
    
    
    
    
    
    
    $
    1,011,207
    
    
    $
    856,156Liabilities
    
    
    
    
    
    
    
    
    
    
    (694,537
    )
    
    
    (635,993
    )Partners and members equity
    
    
    
    
    
    
    
    
    
    $
    316,670
    
    
    $
    220,163Three months ended September 30,
    
    
    Nine months ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Revenue
    
    $
    21,541
    
    
    $
    14,383
    
    
    $
    57,877
    
    
    $
    41,845Expenses
    
    
    (16,386
    )
    
    
    (12,389
    )
    
    
    (45,670
    )
    
    
    (33,357
    )Net income
    
    $
    5,155
    
    
    $
    1,994
    
    
    $
    12,207
    
    
    $
    8,488Our share of income
from equity
investments in real
estate
    
    $
    1,739
    
    
    $
    1,052
    
    
    $
    3,527
    
    
    $
    3,067
 CPA®:16  Global 9/30/2007 10-Q  10




---



##### 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 9/30/2007 10-Q  11




---



##### Table of Contents



Notes to Consolidated Financial Statements
   Note 8. Intangibles
   September 30, 2007
    
    
    December 31, 2006Lease intangibles
In-place lease
    
    $
    98,909
    
    
    $
    67,984Tenant relationship
    
    
    27,567
    
    
    
    19,778Above-market rent
    
    
    44,056
    
    
    
    27,689Less: accumulated amortization
    
    
    (13,288
    )
    
    
    (7,450
    )$
    157,244
    
    
    $
    108,001Below-market rent
    
    $
    (39,031
    )
    
    $
    (24,792
    )Less: accumulated amortization
    
    
    2,051
    
    
    
    1,125$
    (36,980
    )
    
    $
    (23,667
    )
  Note 9. Commitments and Contingencies
   ®
 CPA®:16  Global 9/30/2007 10-Q  12




---



##### Table of Contents



Notes to Consolidated Financial Statements
 ® ®
 ® ® ® ® ®
 ® ® ® ® ®
    CPA®:16  Global 9/30/2007 10-Q  13




---



##### 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
  Embedded Credit Derivative
 Foreign Currency Exchange
 CPA®:16  Global 9/30/2007 10-Q  14




---



##### Table of Contents



Notes to Consolidated Financial Statements
 Concentration of Credit Risk
   Note 11. Income Taxes
     CPA®:16  Global 9/30/2007 10-Q  15




---



##### Table of Contents



Notes to Consolidated Financial Statements
 Note 12. Pro Forma Financial Information
  Three months ended September 30,
    
    
    Nine months ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Pro forma total revenues
    
    $
    46,400
    
    
    $
    43,096
    
    
    $
    135,347
    
    
    $
    126,297Pro forma net income
    
    
    13,833
    
    
    
    8,169
    
    
    
    33,094
    
    
    
    20,412Pro forma earnings per share:Basic and diluted
    
    $
    0.12
    
    
    $
    0.07
    
    
    $
    0.28
    
    
    $
    0.17
  Note 13. Subsequent Events
 CPA®:16  Global 9/30/2007 10-Q  16




---



##### 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 
 Quarterly Distribution
 Directors
  Investment Activity
 CPA ® :16  Global 9/30/2007 10-Q 17




---



##### Table of Contents



Nine months ended September 30,2007
    
    2006Total investments(a)
    
    $
    909,473
    
    
    $
    299,439Number of investments
    
    
    14
    
    
    
    12Average investment size
    
    $
    64,962
    
    
    $
    24,953Percentage of international investments
    
    
    60
    %
    
    
    27
    %
 
 (a)
    
    Inclusive of minority interest of our consolidated investments and 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. During
2007, a single transaction in Germany (the Hellweg 2 transaction ) accounted for $446,387 of
our investment volume, inclusive of minority interest of $330,416.   CPA ® :16  Global 9/30/2007 10-Q 18




---



##### Table of Contents



How Management Evaluates Results of Operations
      Nine months ended September 30,2007
    
    
    2006Rental income
    
    $
    79,344
    
    
    $
    34,876Interest income from direct financing leases
    
    
    19,428
    
    
    
    10,935$
    98,772
    
    
    $
    45,811
 CPA ® :16  Global 9/30/2007 10-Q 19




---



##### Table of Contents



Nine months ended September 30,Lessee
    
    2007
    
    
    2006Hellweg Die Profi-Baumarkte GmbH & Co. KG (a) (b) (c)
    
    $
    16,561
    
    
    $
    Telcordia Technologies, Inc.
    
    
    6,805
    
    
    
    6,692Fraikin SAS (b) (d)
    
    
    4,125
    
    
    
    Nordic Cold Storage LLC(e)
    
    
    4,010
    
    
    
    The Talaria Company (Hinckley) (c)
    
    
    3,736
    
    
    
    3,759Huntsman International, LLC
    
    
    3,011
    
    
    
    3,019MetoKote Corporation, MetoKote Canada Limited and MetoKote de Mexico(b) (h)
    
    
    2,950
    
    
    
    2,860Ply Gem Industries, Inc. (b)
    
    
    2,755
    
    
    
    2,659TRW Vehicle Safety Systems Inc. (f) (h)
    
    
    2,676
    
    
    
    Kings Super Markets Inc.(f)
    
    
    2,562
    
    
    
    1,457Gortz & Schiele GmbH & Co. and Goertz & Schiele Corporation (b) (c) (f) (h)
    
    
    2,510
    
    
    
    Foss Manufacturing Company, LLC
    
    
    2,455
    
    
    
    2,397Finisar Corporation
    
    
    2,453
    
    
    
    2,453Performance Fibers GmbH(b) (f)
    
    
    2,438
    
    
    
    Dicks Sporting Goods, Inc. (c) (f)
    
    
    2,236
    
    
    
    1,012Polestar Petty Ltd. (b) (g)
    
    
    2,215
    
    
    
    2,004LFD Manufacturing Limited, IDS Logistics (Thailand) Limited and IDS Manufacturing
SDN BHD (b) (f)
    
    
    2,049
    
    
    
    1,762Edgen Murray Europe Limited (b)
    
    
    1,716
    
    
    
    1,561Bobs Discount Furniture, LLC (f)
    
    
    1,661
    
    
    
    1,236Hilite Germany GmbH & Co. KG (b) (f) (h)
    
    
    1,598
    
    
    
    862Holopack International Corp. (e)
    
    
    1,588
    
    
    
    Other (b) (c) (e) (f) (h)
    
    
    26,662
    
    
    
    12,078$
    98,772
    
    
    $
    45,811
 
 (a)
    
    Represents our interest in the Hellweg 2 transaction, acquired in April 2007. 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)
    
    These revenues are generated in consolidated joint ventures with affiliates and include
lease revenues applicable to minority interests totaling $18,835 and $2,139 for the nine
months ended September 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.(h)
    
    Tenant operates in the automotive industry. Included in Other are lease revenues from two
additional tenants operating in the automotive industry totaling $1,363 and $685 for the nine
months ended September 30, 2007 and 2006, respectively. CPA ® :16  Global 9/30/2007 10-Q 20




---



##### Table of Contents



Ownership Interest at
    
    
    Nine months ended September 30,Lessee
    
    September 30, 2007
    
    
    2007
    
    
    2006U-Haul Moving Partners, Inc. and Mercury Partners, L.P.
    
    
    30.77%
    
    
    $
    21,329
    
    
    $
    21,406OBI A.G. (a) (b)
    
    
    25%
    
    
    
    11,369
    
    
    
    6,823Hellweg Die Profi-Baumarkte GmbH & Co. KG (a) (c) (d)
    
    
    25%
    
    
    
    10,375
    
    
    
    9,413Thales S.A. (a) (d)
    
    
    35%
    
    
    
    9,639
    
    
    
    8,368Pohjola Non-life Insurance Company(a) (d)
    
    
    40%
    
    
    
    6,214
    
    
    
    5,668TietoEnator Plc (a) (d)
    
    
    40%
    
    
    
    5,858
    
    
    
    5,304Police Prefecture, French Government (a) (d)
    
    
    50%
    
    
    
    5,162
    
    
    
    4,638Consolidated Systems, Inc.(e)
    
    
    40%
    
    
    
    1,373
    
    
    
    Actuant Corporation(a) (d) (f)
    
    
    50%
    
    
    
    1,269
    
    
    
    1,141Schuler A.G. (a) (g)
    
    
    33.33%
    
    
    
    668
    
    
    
    $
    73,256
    
    
    $
    62,761
 
 (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 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.(f)
    
    Tenant operates in the automotive industry.(g)
    
    We acquired our interest in this investment during 2007. Results of Operations
    CPA ® :16  Global 9/30/2007 10-Q 21




---



##### Table of Contents



Lease Revenues
     Interest Income on Notes Receivable
  Depreciation and Amortization
  Property Expenses
  General and Administrative
  Other Interest Income
  CPA ® :16  Global 9/30/2007 10-Q 22




---



##### Table of Contents



Minority Interest in Income
   Gain on Foreign Currency Transactions, Derivative Instruments and Other, Net
  Interest Expense
  Provision for Income Taxes
  Net Income
  Financial Condition
 Uses of Cash During the Period
  Operating Activities
 Investing Activities
 CPA ® :16  Global 9/30/2007 10-Q 23




---



##### Table of Contents



Financing Activities
 Summary of Financing
  September 30,2007
    
    
    2006Balance:Fixed rate
    
    $
    1,341,028
    
    
    $
    480,521Variable rate (1)
    
    
    32,481
    
    
    
    Total
    
    $
    1,373,509
    
    
    $
    480,521Percent of total debt:Fixed rate
    
    
    98
    %
    
    
    100
    %Variable rate (1)
    
    
    2
    %
    
    
    0
    %100
    %
    
    
    100
    %Weighted average interest rate at end of period:Fixed rate
    
    
    5.82
    %
    
    
    5.96
    %Variable rate(1)
    
    
    5.23
    %
    
    
    0
    %
 
 (1)
    
    Included in variable rate debt at September 30, 2007 is a $27,866 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
   
    
    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 for 2007 to continue to receive asset management and performance
fees in restricted shares will result in additional cash flow. The advisor has not yet made
its election for 2008.
    
    Scheduled rent increases on several properties during 2007 should result in additional cash
flow.
 Cash Requirements
  CPA ® :16  Global 9/30/2007 10-Q 24




---



##### Table of Contents




    
    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
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
    
    $
    1,368,894
    
    
    $
    13,106
    
    
    $
    36,813
    
    
    $
    49,567
    
    
    $
    1,269,408Mortgage notes payable  Interest
    
    
    762,949
    
    
    
    80,082
    
    
    
    157,316
    
    
    
    152,406
    
    
    
    373,145Note payable  Principal (1)
    
    
    4,615
    
    
    
    4,615
    
    
    
    
    
    
    
    
    
    
    
    Note payable  Interest(2)
    
    
    156
    
    
    
    156
    
    
    
    
    
    
    
    
    
    
    
    Deferred acquisition fees  Principal
    
    
    37,270
    
    
    
    27,824
    
    
    
    9,446
    
    
    
    
    
    
    
    Deferred acquisition fees  Interest
    
    
    4,268
    
    
    
    3,650
    
    
    
    618
    
    
    
    
    
    
    
    Build-to-suit commitments (3)
    
    
    17,704
    
    
    
    17,704
    
    
    
    
    
    
    
    
    
    
    
    Lending commitments (4)
    
    
    52,398
    
    
    
    52,398
    
    
    
    
    
    
    
    
    
    
    
    Operating and other lease commitments (5)
    
    
    59,436
    
    
    
    1,483
    
    
    
    2,977
    
    
    
    3,024
    
    
    
    51,952$
    2,307,690
    
    
    $
    201,018
    
    
    $
    207,170
    
    
    $
    204,997
    
    
    $
    1,694,505
 
 (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 September 30, 2007.(3)
    
    Represents remaining build-to-suit commitments for three projects: 
    
    Blairsville, Pennsylvania  estimated total construction costs are currently projected
to be $25,152 of which $24,365 was funded as of September 30, 2007.
    
    Bloomington, Minnesota  estimated total construction costs are currently projected to
be $46,760 of which $30,850 was funded as of September 30, 2007.
    
    Columbia, South Carolina  estimated total construction costs are currently projected
to be $7,000 of which $5,993 was funded as of September 30, 2007.
 (4)
    
    Represents unfunded amounts on a commitment to provide a loan to a developer of a domestic
property.(5)
    
    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 total approximately
$54,680 over the lease terms, inclusive of minority interest of
approximately $26,155.
  CPA ® :16  Global 9/30/2007 10-Q 25




---



##### Table of Contents



Ownership Interest at
    
    
    
    
    
    
    Total ThirdLessee
    
    September 30, 2007
    
    
    Total Assets
    
    
    Party Debt
    
    
    Maturity DateThales S.A.
    
    
    35%
    
    
    $
    122,406
    
    
    $
    82,471
    
    
    
    7/2011U-Haul Moving Partners, Inc. and Mercury Partners, LP
    
    
    30.77%
    
    
    
    306,349
    
    
    
    172,682
    
    
    
    5/2014Actuant Corporation
    
    
    50%
    
    
    
    18,996
    
    
    
    12,552
    
    
    
    5/2014TietoEnator Plc
    
    
    40%
    
    
    
    105,802
    
    
    
    78,860
    
    
    
    7/2014Pohjola Non-life Insurance Company
    
    
    40%
    
    
    
    115,108
    
    
    
    87,661
    
    
    
    1/2015Hellweg Die Profi-Baumarkte GmbH & Co. KG (1)
    
    
    25%
    
    
    
    195,906
    
    
    
    118,625
    
    
    
    5/2015Consolidated Systems, Inc.
    
    
    40%
    
    
    
    17,454
    
    
    
    11,883
    
    
    
    11/2016OBI A.G. (2)
    
    
    25%
    
    
    
    238,145
    
    
    
    177,113
    
    
    
    3/2018Police Prefecture, French Government
    
    
    50%
    
    
    
    123,700
    
    
    
    91,887
    
    
    
    8/2020Schuler A.G. (2)
    
    
    33.33%
    
    
    
    73,690
    
    
    
    
    
    
    
    N/A$
    1,317,556
    
    
    $
    833,734
 
 (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.(2)
    
    We acquired all or part of our interest in this property during 2007. CPA ® :16  Global 9/30/2007 10-Q 26




---



##### 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
    
    $
    3,086
    
    
    $
    13,454
    
    
    $
    17,233
    
    
    $
    20,879
    
    
    $
    23,848
    
    
    $
    1,262,528
    
    
    $
    1,341,028
    
    
    $
    1,344,421Variable rate debt
    
    $
    
    
    
    $
    4,789
    
    
    $
    348
    
    
    $
    348
    
    
    $
    348
    
    
    $
    26,648
    
    
    $
    32,481
    
    
    $
    32,481
  CPA ® :16  Global 9/30/2007 10-Q  27




---



##### Table of Contents



Foreign Currency Exchange Rate Risk
  
 
 Item 4T.  Controls and Procedures
 Disclosure Controls and Procedures
   Changes in Internal Control over Financial Reporting
  CPA ® :16  Global 9/30/2007 10-Q 28




---



##### 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 September 30, 2007, 1,643,543 shares of common stock were issued
to the advisor as consideration for asset management and performance 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)purchased as part of
    
    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)July
    
    
    
    
    
    
    
    
    
    
    N/A
    
    
    
    N/AAugust
    
    
    
    
    
    
    
    
    
    
    N/A
    
    
    
    N/ASeptember
    
    
    161,702
    
    
    $
    9.30
    
    
    
    N/A
    
    
    
    N/ATotal
    
    
    161,702
 
 (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 6.  Exhibits
 Exhibit No.
    
    Description
    
    Method of Filing10.1
    
    
    Third Amended and Restated Advisory Agreement dated September 30, 2007 between Corporate Property
Associates 16  Global Incorporated and Carey Asset Management Corp.
    
    Filed herewith31.1
    
    
    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 9/30/2007 10-Q 29




---



##### Table of Contents



SIGNATURES
  Corporate Property Associates 16  Global IncorporatedDate 11/14/2007
    By:
    /s/ Mark J. DeCesarisMark J. DeCesarisManaging Director and acting Chief Financial Officer
(acting Principal Financial Officer)Date 11/14/2007
    By:
    /s/ Thomas RidingsThomas RidingsExecutive Director and Chief Accounting Officer
(Principal Accounting Officer) CPA ® :16  Global 9/30/2007 10-Q 30