Gladstone Investment makes debt and equity investments in established private businesses in the U.S. Debt investments primarily come in the form of three types of loans: senior term loans, senior subordinated loans and junior subordinated debt. Equity investments primarily take the form of preferred or common equity (or warrants or options to acquire the foregoing), often in connection with buyouts and other recapitalizations. Gladstone Investment's individual investments typically total up to $70 million, although investment size may vary. Gladstone Investment intends that the investment portfolio over time will consist of approximately 75% in debt securities and 25% in equity securities, at cost.
Our investment objectives are (a) to achieve and grow current income by investing in debt securities of established businesses that we believe will provide stable earnings and cash flow to pay expenses, make principal and interest payments on our outstanding indebtedness and make distributions to stockholders that we anticipate will grow over time and (b) to provide our stockholders with long-term capital appreciation in the value of our assets by investing in equity securities of established businesses that we hope will appreciate over time so that we can sell them for capital gains.
We have three affiliate investment companies. Gladstone Commercial Corporation is a real estate investment trust that owns net leased industrial, commercial and retail property and selectively makes long-term industrial and commercial mortgage loans. Gladstone Capital Corporation is a BDC that also invests in small and medium sized private businesses in the U.S., historically as a debt fund. Gladstone Land Corporation is a real estate investment trust that invests in farmland located in major agricultural markets in the U.S.