Gladstone Commercial (GOOD) 10-Q 2014 Q2 Quarterly report

Exhibit 12

Statements re: computation of ratios

(Dollars in Thousands)

	For the six months ended June 30,			For the year ended December 31,
	2014			2013			2012			2011			2010			2009
Net income from continuing operations(1)	$	(12,297	)	$	1,527		$	3,761		$	5,714		$	4,928		$	4,400
Add: fixed charges and preferred and senior common distributions		16,423			31,506			26,962			21,247			21,191			22,001
Less: preferred and senior common distributions		(2,257	)		(4,394	)		(4,206	)		(4,156	)		(4,114	)		(4,094	)
Earnings	$	1,869		$	28,639		$	26,517		$	22,805		$	22,005		$	22,307
Fixed charges and preferred and senior common distributions:
Interest expense(2)		13,361			25,314			21,239			16,158			16,031			16,399
Amortization of deferred financing fees		795			1,780			1,502			918			1,031			1,496
Estimated interest component of rent		10			18			15			15			15			12
Preferred and senior common distributions		2,257			4,394			4,206			4,156			4,114			4,094
Total fixed charges and preferred and senior common distributions	$	16,423		$	31,506		$	26,962		$	21,247		$	21,191		$	22,001
Ratio of earnings to combined fixed charges and preferred distributions		N/A	(3)		N/A	(4)		N/A	(5)		1.1			1.0			1.0

⁽¹⁾ Net income from continuing operations includes a $14.0 million impairment recorded during the three months ended March 31, 2014.

⁽²⁾ Interest expense includes dividends paid on our mandatorily redeemable term preferred stock.

⁽³⁾ For the six months ended June 30, 2014, earnings, as defined, were insufficient to cover fixed charges by $14,554

⁽⁴⁾ For the year ended December 31, 2013, earnings, as defined, were insufficient to cover fixed charges by $2,867.

⁽⁵⁾ For the year ended December 31, 2012, earnings, as defined, were insufficient to cover fixed charges by $445.

N/A: Not Applicable

The calculation of the ratio of earnings to combined fixed charges and preferred distributions is above. “Earnings” consist of net income from continuing operations and before fixed charges. “Fixed charges” consist of interest expense, amortization of deferred financing fees and the portion of operating lease expense that represents interest. The portion of operating lease expense that represents interest is calculated by dividing the amount of rent expense, allocated to us by our Administrator as part of the administration fee payable under the Administration Agreement, by three, for the years ended December 31, 2009 to 2013 and for the six months ended June 30, 2014.