EX-99.2

EX-99.2 3 bnl-ex99_2.htm EX-99.2 EX-99.2

Exhibit 99.2

Q1 2023 QUARTERLY SUPPLEMENTAL INFORMATION Broadstone Net Lease, Inc. (NYSE: BNL) is a Real Estate Investment Trust (REIT) that acquires, owns, and manages single-tenant commercial real estate properties that are net leased on a long-term basis to a diversified group of tenants. www.broadstone.com

Table of Contents


Section	Page
About the Data	3
Company Overview	4
Quarterly Financial Summary	5
Balance Sheet	6
Income Statement Summary	7
Funds From Operations (FFO), Core Funds From Operations (Core FFO), and Adjusted Funds From Operations (AFFO)	8
EBITDA, EBITDAre, and Other Non-GAAP Operating Measures	9
Lease Revenues Detail	10
Capital Structure	11
Equity Rollforward	12
Debt Outstanding	13
Net Debt Metrics	14
Covenants	15
Debt Maturities	16
Investment Activity	17
Dispositions	18
Portfolio at a Glance: Key Metrics	19
Diversification: Tenants and Brands	20-23
Diversification: Property Type	24-25
Key Statistics by Property Type	26
Diversification: Tenant Industry	27
Diversification: Geography	28
Lease Expirations	29
Portfolio Occupancy	30
Definitions and Explanations	31-32

About the Data

This data and other information described herein are as of and for the three months ended September 30, 2023 unless otherwise indicated. Future performance may not be consistent with past performance and is subject to change and inherent risks and uncertainties. This information should be read in conjunction with Broadstone Net Lease, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2022, including the financial statements and the management's discussion and analysis of financial condition and results of operations sections.

Forward Looking Statements

Information set forth herein contains forward-looking statements, which reflect our current views regarding our business, financial performance, growth prospects and strategies, market opportunities, and market trends. Forward-looking statements include all statements that are not historical facts. In some cases, you can identify these forward-looking statements by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "could," "seeks," "approximately," "projects," "predicts," "intends," "plans," "estimates," "anticipates," or the negative version of these words or other comparable words. All of the forward-looking statements herein are subject to various risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results, performance, and achievements could differ materially from those expressed in or by the forward-looking statements and may be affected by a variety of risks and other factors. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from such forward-looking statements. These factors include, but are not limited to, risks and uncertainties related to general economic conditions, including but not limited to increases in the rate of inflation and/or interest rates, local real estate conditions, tenant financial health, and property acquisitions and the timing of these investments and acquisitions. These and other risks, assumptions, and uncertainties are described in our filings with the SEC, which are available on the SEC's website at www.sec.gov.

You are cautioned not to place undue reliance on any forward-looking statements included herein. All forward-looking statements are made as of the date of this document and the risk that actual results, performance, and achievements will differ materially from the expectations expressed or referenced herein will increase with the passage of time. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as required by law.

Company Overview

Broadstone Net Lease, Inc. (NYSE:BNL) (the "Company," "BNL," "us," "our" and "we") is an industrial-focused, diversified net lease real estate investment trust ("REIT") that acquires, owns, and manages primarily single-tenant commercial real estate properties that are net leased on a long-term basis to a diversified group of tenants. Since our inception, we have selectively invested in real estate across the industrial, healthcare, restaurant, retail, and office property types. We target properties with credit worthy tenants in industries characterized by positive business drivers and trends, where the properties are an integral part of the tenants' businesses and there are opportunities to secure long-term net leases. Through long-term net leases, our tenants are able to retain operational control of their strategically important locations, while allocating their debt and equity capital to fund core business operations rather than real estate ownership.

Executive Team
John D. Moragne
Chief Executive Officer and Member, Board of Directors
Ryan M. Albano
President and Chief Operating Officer
Kevin M. Fennell
Executive Vice President and Chief Financial Officer
John D. Callan, Jr.
Senior Vice President, General Counsel, and Secretary
Michael B. Caruso
Senior Vice President, Corporate Strategy & Investor Relations
Timothy D. Dieffenbacher 
Senior Vice President, Chief Accounting Officer, and Treasurer
Jennie L. O'Brien 
Senior Vice President, Accounting, and Controller
Roderick A. Pickney
Senior Vice President, Acquisitions
Molly Kelly Wiegel
Senior Vice President, Human Resources & Administration
Andrea T. Wright
Senior Vice President, Property Management
 

Board of Directors
Laurie A. Hawkes
Chairman of the Board
John D. Moragne
Chief Executive Officer 
Denise Brooks-Williams
Michael A. Coke
Jessica Duran
Laura Felice
David M. Jacobstein
Shekar Narasimhan
James H. Watters
 
 

Company Contact Information
Michael Caruso
SVP, Corporate Strategy & Investor Relations
[email protected]
585-402-7842
 
 
Transfer Agent
Computershare Trust Company, N.A.
150 Royall Street
Canton, Massachusetts 02021
800-736-3001

Quarterly Financial Summary

(unaudited, dollars in thousands, except per share data)


	Q3 2023			Q2 2023			Q1 2023			Q4 2022			Q3 2022
Financial Summary
Investment in rental property	$	4,939,598		$	4,981,430		$	5,002,330		$	5,035,846		$	4,775,460
Less accumulated depreciation		(601,895	)		(578,616	)		(558,410	)		(533,965	)		(505,456	)
Property under development		49,819			37,449			—			—			—
Investment in rental property, net		4,387,522			4,440,263			4,443,920			4,501,881			4,270,004
Cash and cash equivalents		35,061			20,763			15,412			21,789			75,912
Restricted cash		15,436			15,502			3,898			38,251			6,449
Total assets		5,335,043			5,368,150			5,335,868			5,457,609			5,239,192
Unsecured revolving credit facility		74,060			122,912			108,330			197,322			219,537
Mortgages, net		79,613			80,141			85,853			86,602			94,753
Unsecured term loans, net		895,633			895,319			895,006			894,692			894,378
Senior unsecured notes, net		845,121			844,932			844,744			844,555			844,367
Total liabilities		2,059,570			2,106,553			2,103,551			2,195,104			2,231,045
Total Broadstone Net Lease, Inc. stockholders' equity		3,120,776			3,107,536			3,079,207			3,092,918			2,840,692
Total equity (book value)		3,275,473			3,261,597			3,232,317			3,262,505			3,008,147

Revenues		109,543			109,353			118,992			112,135			103,524
General and administrative - other		8,603			7,944			8,924			7,814			8,439
Stock based compensation		1,540			1,539			1,492			1,503			1,503
General and administrative		10,143			9,483			10,416			9,317			9,942
Total operating expenses		54,383			53,502			59,559			61,320			59,133
Interest expense		19,665			20,277			21,139			23,773			20,095
Net income		52,145			62,996			41,374			36,773			28,709
Net earnings per common share, diluted	$	0.26		$	0.32		$	0.21		$	0.20		$	0.16

FFO		75,478			72,524			81,177			71,718			72,169
FFO per share, diluted	$	0.39		$	0.37		$	0.41		$	0.39		$	0.39
Core FFO		74,754			74,381			74,473			70,527			66,677
Core FFO per share, diluted	$	0.38		$	0.38		$	0.38		$	0.38		$	0.36
AFFO		69,958			69,004			67,485			65,584			63,386
AFFO per share, diluted	$	0.36		$	0.35		$	0.34		$	0.36		$	0.35

Net cash provided by operating activities		73,888			62,228			74,376			60,440			77,515
Net cash used in investing activities		42,528			1,713			29,633			(274,485	)		(205,187	)
Net cash provided by financing activities		(102,184	)		(46,986	)		(144,739	)		191,724			181,057
Distributions declared		54,274			55,419			54,887			45,824			46,242
Distributions declared per diluted share	$	0.280		$	0.280		$	0.275		$	0.275		$	0.270

Balance Sheet

(unaudited, in thousands)


	September 30, 2023			June 30, 2023			March 31, 2023			December 31, 2022			September 30, 2022
Assets
Accounted for using the operating method:
Land	$	752,708		$	754,402		$	760,142		$	768,667		$	755,206
Land improvements		330,214			332,757			337,296			340,385			331,858
Buildings and improvements		3,819,745			3,857,236			3,866,952			3,888,756			3,650,275
Equipment		9,608			9,608			10,422			10,422			10,422
Total accounted for using the operating method		4,912,275			4,954,003			4,974,812			5,008,230			4,747,761
Less accumulated depreciation		(601,895	)		(578,616	)		(558,410	)		(533,965	)		(505,456	)
Accounted for using the operating method, net		4,310,380			4,375,387			4,416,402			4,474,265			4,242,305
Accounted for using the direct financing method		26,751			26,855			26,947			27,045			27,128
Accounted for using the sales-type method		572			572			571			571			571
Property under development		49,819			37,449			—			—			—
Investment in rental property, net		4,387,522			4,440,263			4,443,920			4,501,881			4,270,004
Cash and cash equivalents		35,061			20,763			15,412			21,789			75,912
Accrued rental income		152,268			148,697			142,031			135,666			129,579
Tenant and other receivables, net		1,372			1,895			2,004			1,349			791
Prepaid expenses and other assets		42,309			42,322			29,764			64,180			34,221
Interest rate swap, assets		79,086			65,143			45,490			63,390			66,602
Goodwill		339,769			339,769			339,769			339,769			339,769
Intangible lease assets, net		297,656			309,298			317,478			329,585			322,314
Total assets	$	5,335,043		$	5,368,150		$	5,335,868		$	5,457,609		$	5,239,192
Liabilities and equity
Unsecured revolving credit facility	$	74,060		$	122,912		$	108,330		$	197,322		$	219,537
Mortgages, net		79,613			80,141			85,853			86,602			94,753
Unsecured term loans, net		895,633			895,319			895,006			894,692			894,378
Senior unsecured notes, net		845,121			844,932			844,744			844,555			844,367
Accounts payable and other liabilities		44,886			44,147			46,090			47,547			52,594
Dividends payable		55,770			55,640			54,515			54,460			49,886
Accrued interest payable		9,186			5,889			9,654			7,071			10,559
Intangible lease liabilities, net		55,301			57,573			59,359			62,855			64,971
Total liabilities		2,059,570			2,106,553			2,103,551			2,195,104			2,231,045
Equity
Broadstone Net Lease, Inc. stockholders' equity:
Preferred stock, $0.001 par value		—			—			—			—			—
Common stock, $0.00025 par value		47			47			47			47			43
Additional paid-in capital		3,430,725			3,430,692			3,434,534			3,419,395			3,148,075
Cumulative distributions in excess of retained earnings		(393,571	)		(391,631	)		(398,890	)		(386,049	)		(369,260	)
Accumulated other comprehensive Income		83,575			68,428			43,516			59,525			61,834
Total Broadstone Net Lease, Inc. stockholders’ equity		3,120,776			3,107,536			3,079,207			3,092,918			2,840,692
Non-controlling interests		154,697			154,061			153,110			169,587			167,455
Total equity		3,275,473			3,261,597			3,232,317			3,262,505			3,008,147
Total liabilities and equity	$	5,335,043		$	5,368,150		$	5,335,868		$	5,457,609		$	5,239,192

Income Statement Summary

(unaudited, in thousands, except per share data)


	Three Months Ended
	September 30, 2023			June 30, 2023			March 31, 2023			December 31, 2022			September 30, 2022
Revenues
Lease revenues, net	$	109,543		$	109,353		$	118,992		$	112,135		$	103,524
Operating expenses
Depreciation and amortization		38,533			39,031			41,784			45,606			39,400
Property and operating expense		5,707			4,988			5,886			6,397			5,636
General and administrative		10,143			9,483			10,416			9,317			9,942
Provision for impairment of investment in rental properties		—			—			1,473			—			4,155
Total operating expenses		54,383			53,502			59,559			61,320			59,133
Other income (expenses)
Interest income		127			82			162			40			4
Interest expense		(19,665	)		(20,277	)		(21,139	)		(23,773	)		(20,095	)
Gain on sale of real estate		15,163			29,462			3,415			10,625			61
Income taxes		(104	)		(448	)		(479	)		(106	)		(356	)
Other (expenses) income		1,464			(1,674	)		(18	)		(828	)		4,704
Net income		52,145			62,996			41,374			36,773			28,709
Net income attributable to non-controlling interests		(2,463	)		(2,982	)		(2,070	)		(2,041	)		(1,600	)
Net income attributable to Broadstone Net Lease, Inc.	$	49,682		$	60,014		$	39,304		$	34,732		$	27,109

Weighted average number of common shares outstanding
Basic1		186,766			186,733			186,130			173,283			172,578
Diluted1		196,372			196,228			196,176			183,592			182,971
Net earnings per common share2
Basic	$	0.27		$	0.32		$	0.21		$	0.20		$	0.16
Diluted	$	0.26		$	0.32		$	0.21		$	0.20		$	0.16

1 Excludes 506,172, 504,161, 431,392, 396,924, and 395,441, weighted average shares of unvested restricted common stock for the three months ended September 30, 2023, June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022, respectively.

2 Excludes $0.1 million from the numerator for the three months ended September 30, 2023, and June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022, related to dividends declared on shares of unvested restricted stock.

Funds From Operations (FFO), Core Funds From Operations (Core FFO), and Adjusted Funds From Operations (AFFO)

(unaudited, in thousands, except per share data)


	Three Months Ended
	September 30, 2023			June 30, 2023			March 31, 2023			December 31, 2022			September 30, 2022
Net income	$	52,145		$	62,996		$	41,374		$	36,773		$	28,709
Real property depreciation and amortization		38,496			38,990			41,745			45,570			39,366
Gain on sale of real estate		(15,163	)		(29,462	)		(3,415	)		(10,625	)		(61	)
Provision for impairment of investment in rental properties		—			—			1,473			—			4,155
FFO	$	75,478		$	72,524		$	81,177		$	71,718		$	72,169
Net write-offs of accrued rental income		—			—			297			—			—
Lease termination fees		—			—			(7,500	)		(1,678	)		(791	)
Cost of debt extinguishment		—			3			—			77			231
Gain on insurance recoveries		—			—			—			(341	)		—
Severance and executive transition costs1		740			183			481			—			3
Other (income) expenses2		(1,464	)		1,671			18			751			(4,935	)
Core FFO	$	74,754		$	74,381		$	74,473		$	70,527		$	66,677
Straight-line rent adjustment		(6,785	)		(7,276	)		(7,271	)		(6,826	)		(5,175	)
Adjustment to provision for credit losses		—			(10	)		—			—			(4	)
Amortization of debt issuance costs		983			986			986			988			948
Amortization of net mortgage premiums		—			(52	)		(26	)		(26	)		(26	)
Loss on interest rate swaps and other non-cash interest expense		522			521			522			522			639
Amortization of lease intangibles		(1,056	)		(1,085	)		(2,691	)		(1,308	)		(1,176	)
Stock-based compensation		1,540			1,539			1,492			1,503			1,503
Deferred taxes		—			—			—			204			—
AFFO	$	69,958		$	69,004		$	67,485		$	65,584		$	63,386

Diluted weighted average shares outstanding3		196,372			196,228			196,176			183,592			182,971
Net earnings per diluted share4	$	0.26		$	0.32		$	0.21		$	0.20		$	0.16
FFO per diluted share4		0.39			0.37			0.41			0.39			0.39
Core FFO per diluted share4		0.38			0.38			0.38			0.38			0.36
AFFO per diluted share4		0.36			0.35			0.34			0.36			0.35

1 Amount includes $0.7 million and $ 0.2 million of employee severance costs and executive transition costs during the three months ended September 30, 2023 and the three months ended June 30, 2023. Amounts include a combined $0.5 million of executive transition costs and accelerated amortization of stock-based compensation for the three months ended March 31, 2023, related to the departure of our previous chief executive officer.

2 Amount includes $(1.4) million, $1.7 million, $18 thousand, $0.8 million, and ($4.9) million of unrealized and realized foreign exchange (gain) loss for the three months ended September 30, 2023, June 30, 2023, March 31, 2023, December 31, 2022 and September 30, 2022, respectively, primarily associated with our Canadian dollar denominated revolver borrowings.

3 Excludes 506,172, 504,161, 431,392, 396,924, and 395,441, weighted average shares of unvested restricted common stock for the three months ended September 30, 2023, June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022, respectively.

4 Excludes $0.1 million from the numerator for the three months ended September 30, 2023, and June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022, related to dividends declared on shares of unvested restricted stock.

EBITDA, EBITDAre, and Other-Non GAAP Operating Measures

(unaudited, in thousands)


	Three Months Ended
	September 30, 2023			June 30, 2023			March 31, 2023			December 31, 2022			September 30, 2022
Net income	$	52,145		$	62,996		$	41,374		$	36,773		$	28,709
Depreciation and amortization		38,533			39,031			41,784			45,606			39,400
Interest expense		19,665			20,277			21,139			23,773			20,095
Income taxes		104			448			479			105			356
EBITDA	$	110,447		$	122,752		$	104,776		$	106,257		$	88,560
Provision for impairment of investment in rental properties		—			—			1,473			—			4,155
Gain on sale of real estate		(15,163	)		(29,462	)		(3,415	)		(10,625	)		(61	)
EBITDAre	$	95,284		$	93,290		$	102,834		$	95,632		$	92,654
Adjustment for current quarter investment activity 1		26			342			406			1,283			2,358
Adjustment for current quarter disposition activity 2		(400	)		(444	)		(365	)		(440	)		—
Adjustment to exclude non-recurring and other expenses 3		740			183			(1,023	)		—			—
Adjustment to exclude gain on insurance recoveries		—			—			—			(341	)		—
Adjustment to exclude net write-offs of accrued rental income		—			—			297			—			—
Adjustment to exclude realized / unrealized foreign exchange (gain) loss		(1,433	)		1,681			18			796			(4,934	)
Adjustment to exclude cost of debt extinguishments		—			3			—			77			231
Adjustment to exclude lease termination fees		—			—			(7,500	)		(1,678	)		(791	)
Adjusted EBITDAre	$	94,217		$	95,055		$	94,667		$	95,329		$	89,518
General and administrative		9,404			9,300			9,935			9,318			9,942
Adjusted Net Operating Income ("NOI")	$	103,621		$	104,355		$	104,602		$	104,647		$	99,460
Straight-line rental revenue, net		(6,744	)		(7,277	)		(7,425	)		(7,315	)		(5,750	)
Other amortization and non-cash charges		(1,087	)		(1,095	)		(1,668	)		(1,353	)		(1,177	)
Adjusted Cash NOI	$	95,789		$	95,983		$	95,509		$	95,979		$	92,533
Annualized EBITDAre	$	381,136		$	373,160		$	411,336		$	382,528		$	370,616
Annualized Adjusted EBITDAre		376,868			380,220			378,668			381,315			358,072
Annualized Adjusted NOI		414,483			417,420			418,411			418,585			397,834
Annualized Adjusted Cash NOI		383,157			383,932			382,043			383,914			370,128

1 Reflects an adjustment to give effect to all investments during the quarter as if they had been made as of the beginning of the quarter.

2 Reflects an adjustment to give effect to all dispositions during the quarter as if they had been sold as of the beginning of the quarter.

3 Amount includes $0.7 million and $ 0.2 million of employee severance costs and executive transition costs during the three months ended September 30, 2023 and the three months ended June 30, 2023. Amounts include a combined $0.5 million of executive transition costs and accelerated amortization of stock-based compensation for the three months ended March 31, 2023, related to the departure of our previous chief executive officer. Additionally amount includes $(1.5) million of accelerated amortization of lease intangibles during the three months ended March 31, 2023.

Lease Revenues Detail

(unaudited, in thousands)


	Three Months Ended
	September 30, 2023	June 30, 2023	March 31, 2023	December 31, 2022	September 30, 2022
Contractual rental amounts billed for operating leases	$96,333	$96,456	$98,102	$96,208	$91,208
Adjustment to recognize contractual operating lease billings on a straight- line basis	6,891	7,380	7,370	6,898	5,344
Net write-offs of accrued rental income	—	—	(105)	—	—
Variable rental amounts earned	513	452	341	721	309
Earned income from direct financing leases	687	689	691	693	719
Interest income from sales-type leases	14	15	14	15	14
Operating expenses billed to tenants	5,181	4,594	5,075	5,720	5,061
Other income from real estate transactions	19	3	7,392	2,019	874
Adjustment to revenue recognized for uncollectible rental amounts billed, net	(95)	(236)	112	(139)	(5)
Total Lease revenues, net	$109,543	$109,353	$118,992	$112,135	$103,524

Capital Structure

(in thousands, except per share data)


EQUITY
Shares of Common Stock		187,272
OP Units		9,283
Common Stock & OP Units		196,555
Price Per Share / Unit at September 30, 2023	$	14.30
IMPLIED EQUITY MARKET CAPITALIZATION	$	2,810,737
% of Total Capitalization		59.6	%
DEBT
Unsecured Revolving Credit Facility - 2026	$	74,060
Unsecured Term Loans		900,000
Unsecured Term Loan - 2026		400,000
Unsecured Term Loan - 2027		200,000
Unsecured Term Loan - 2029		300,000
Senior Unsecured Notes		850,000
Senior Unsecured Notes - 2027		150,000
Senior Unsecured Notes - 2028		225,000
Senior Unsecured Notes - 2030		100,000
Senior Unsecured Public Notes - 2031		375,000
Mortgage Debt - Various		79,727
TOTAL DEBT	$	1,903,787
% of Total Capitalization		40.4	%
Floating Rate Debt %		0.0	%
Fixed Rate Debt %		100.0	%
Secured Debt %		4.2	%
Unsecured Debt %		95.8	%

Total Capitalization	$	4,714,524
Less: Cash and Cash Equivalents		(35,061	)
Enterprise Value	$	4,679,463

Equity Rollforward

(in thousands)


	Shares of Common Stock	OP Units	Total Diluted Shares
Balance, January 1, 2023	186,114	10,205	196,319
Grants of restricted stock awards - Employees	259	—	259
Retirement of common shares under equity incentive plan	(66)	—	(66)
OP conversion	896	(896)	—
Balance, March 31, 2023	187,203	9,309	196,512
Grants of restricted stock awards - Board of Directors	50	—	50
Grants of restricted stock awards - Employees	1	—	1
Forfeiture of restricted stock awards	(6)	—	(6)
OP conversion	25	(25)	—
Balance, June 30, 2023	187,273	9,284	196,557
Forfeiture of restricted stock awards	(2)	—	(2)
OP conversion	1	(1)	—
Balance, September 30, 2023	187,272	9,283	196,555

Debt Outstanding

(in thousands)


	Outstanding Balance
	September 30,			December 31,
	2023			2022			Interest Rate	Maturity Date
Unsecured revolving credit facility	$	74,060		$	197,322		Applicable reference rate + 0.85%1	Mar. 20264
Unsecured term loans:
2026 Unsecured Term Loan		400,000			400,000		one-month adjusted SOFR + 1.00%2 3	Feb. 2026
2027 Unsecured Term Loan		200,000			200,000		one-month adjusted SOFR + 0.95%3	Aug. 2027
2029 Unsecured Term Loan		300,000			300,000		one-month adjusted SOFR + 1.25%3	Aug. 2029
Total unsecured term loans		900,000			900,000
Unamortized debt issuance costs, net		(4,367	)		(5,308	)
Total unsecured term loans, net		895,633			894,692
Senior unsecured notes:
2027 Senior Unsecured Notes - Series A		150,000			150,000		4.84%	Apr. 2027
2028 Senior Unsecured Notes - Series B		225,000			225,000		5.09%	Jul. 2028
2030 Senior Unsecured Notes - Series C		100,000			100,000		5.19%	Jul. 2030
2031 Senior Unsecured Public Notes		375,000			375,000		2.60%	Sep. 2031
Total senior unsecured notes		850,000			850,000
Unamortized debt issuance costs and original issuance discount, net		(4,879	)		(5,445	)
Total senior unsecured notes, net		845,121			844,555
Total unsecured debt, net	$	1,814,814		$	1,936,569

1 At September 30, 2023 and December 31, 2022, a balance of $0.0 million and $123.5 million was subject to the one-month SOFR of 5.32% and 4.36%, respectively. The remaining balance of $100 million Canadian Dollar ("CAD") borrowings remeasured to $74.1 million United States Dollar ("USD") and $73.8 million USD, at September 30, 2023 and December 31, 2022, respectively, and was subject to the one-month CDOR of 5.39% and 4.74%, respectively.

2 At September 30, 2023, one-month SOFR was 5.32%. At December 31, 2022, the applicable interest rate was 1-month LIBOR of 4.39% plus 1.00%.

3 At September 30, 2023 and December 31, 2022, one-month SOFR was 5.32% and 4.36%, respectively.

4 Our Revolving Credit Facility contains two six-month extension options subject to certain conditions, including the payment of an extension fee equal to 0.0625% of the revolving commitments.


	Origination	Maturity
	Date	Date	Interest	September 30,			December 31,
Lender	(Month/Year)	(Month/Year)	Rate	2023			2022
Wilmington Trust National Association	Apr-19	Feb-28	4.92%	$	44,542		$	45,516
Wilmington Trust National Association	Jun-18	Aug-25	4.36%		18,834			19,150
PNC Bank	Oct-16	Nov-26	3.62%		16,351			16,675
Aegon	Apr-12	Oct-23	6.38%		—			5,413
Total mortgages					79,727			86,754
Debt issuance costs, net					(114	)		(152	)
Mortgages, net				$	79,613		$	86,602


Year of Maturity	Revolving Credit Facility		Mortgages		Term Loans		Senior Notes		Total
2023	$	—	$	554	$	—	$	—	$	554
2024		—		2,260		—		—		2,260
2025		—		20,195		—		—		20,195
2026		74,060		16,843		400,000		—		490,903
2027		—		1,597		200,000		150,000		351,597
Thereafter		—		38,277		300,000		700,000		1,038,277
Total	$	74,060	$	79,726	$	900,000	$	850,000	$	1,903,786

Net Debt Metrics

(in thousands)


	September 30, 2023	June 30, 2023	March 31, 2023	December 31, 2022	September 30, 2022
Debt
Unsecured revolving credit facility	$74,060	$122,912	$108,330	$197,322	$219,537
Unsecured term loans, net	895,633	895,319	895,006	894,692	894,378
Senior unsecured notes, net	845,121	844,932	844,744	844,555	844,367
Mortgages, net	79,613	80,141	85,853	86,602	94,753
Debt issuance costs	9,360	9,872	10,390	10,905	11,498
Gross Debt	1,903,787	1,953,176	1,944,323	2,034,076	2,064,533
Cash and cash equivalents	(35,061)	(20,763)	(15,412)	(21,789)	(75,912)
Restricted cash	(15,436)	(15,502)	(3,898)	(38,251)	(6,449)
Net Debt	$1,853,290	$1,916,911	$1,925,013	$1,974,036	$1,982,172
Anticipated proceeds from forward equity agreement	—	—	—	—	(270,732)
Pro Forma Net Debt	$1,853,290	$1,916,911	$1,925,013	$1,974,036	$1,711,440

Net Debt to Annualized EBITDAre	4.9x	5.1x	4.7x	5.2x	5.3x
Net Debt to Annualized Adjusted EBITDAre	4.9x	5.0x	5.1x	5.2x	5.5x
Pro Forma Net Debt to Annualized Adjusted EBITDAre	4.9x	5.0x	5.1x	5.2x	4.8x

Covenants

The following is a summary of key financial covenants for the Company's unsecured debt instruments. The covenants associated with the Revolving Credit Facility, Unsecured Term Loans with commercial banks, and the Series A-C Senior Unsecured Notes, are reported to the respective lenders via quarterly covenant reporting packages. The covenants associated with the 2031 Senior Unsecured Public Notes are not required to be reported externally to third parties, and are instead calculated in connection with borrowing activity and for financial reporting purposes only. These calculations, which are not based on U.S. GAAP measurements, are presented to investors to show that as of September 30, 2023, the Company believes it is in compliance with the covenants.

Covenants

Required

Revolving Credit Facility and Unsecured Term Loans

Senior Unsecured 
Notes Series 
A, B, & C

2031 Senior Unsecured Public Notes

Leverage ratio

≤ 0.60 to 1.00

0.32

0.33

Not Applicable

Secured indebtedness ratio

≤ 0.40 to 1.00

0.01

0.01

Not Applicable

Unencumbered coverage ratio

≥ 1.75 to 1.00

3.77

Not Applicable

Not Applicable

Fixed charge coverage ratio

≥ 1.50 to 1.00

4.26

4.26

Not Applicable

Total unsecured indebtedness to 
   total unencumbered eligible 
   property value

≤ 0.60 to 1.00

0.34

0.35

Not Applicable

Dividends and other restricted 
   payments

Only applicable 
in case of default

Not Applicable

Not Applicable

Not Applicable

Aggregate debt ratio

≤ 0.60 to 1.00

Not Applicable

Not Applicable

0.35

Consolidated income available for 
   debt to annual debt service 
   charge

≥ 1.50 to 1.00

Not Applicable

Not Applicable

4.71

Total unencumbered assets to 
   total unsecured debt

≥ 1.50 to 1.00

Not Applicable

Not Applicable

2.90

Secured debt ratio

≤ 0.40 to 1.00

Not Applicable

Not Applicable

0.01

Debt Maturities

(dollars in millions)

The Company utilizes diversified sources of debt capital including unsecured bank debt, unsecured notes, and secured mortgages (where appropriate).

1 Our Revolving Credit Facility contains two six-month extension options subject to certain conditions, including the payment of an extension fee equal to 0.0625% of the revolving commitments.

Investment Activity

(square feet and dollars in thousands)

The following tables summarize the Company's investment activity during 2023.


	Q1 20231	Q2 2023	Q3 2023	YTD 2023
Acquisitions:
Number of transactions	1	2	—	3
Number of properties	1	3	—	4
Square feet	10	144	—	154
Acquisition price	$5,221	$20,384	—	$25,605
Industrial	—	20,384	—	20,384
Retail	5,221	—	—	5,221
Restaurant	—	—	—	—
Healthcare	—	—	—	—
Initial cash capitalization rate	6.8%	7.4%	—	7.3%
GAAP capitalization rate	8.0%	8.6%	—	8.5%
Weighted avg. lease term (years)	20.1	14.2	—	15.3
Weighted average annual rent increase	1.8%	2.0%	—	2.0%

Revenue generating capital expenditures:
Number of existing properties	2	1	3	6
Investments2	$14,825	$7,000	$4,755	$26,580
Industrial	14,825	7,000	4,755	26,580
Retail	—	—	—	—
Restaurant	—	—	—	—
Healthcare	—	—	—	—
Initial cash capitalization rate	7.0%	7.0%	6.7%	6.9%
Weighted avg. lease term (years)	18.2	18.4	14.1	17.6
Weighted average annual rent increase	1.8%	1.8%	2.0%	1.8%

Development funding opportunities:
Number of new properties	—	1	1	2
Investments on new developments2	—	$37,549	$739	$38,288
Investments on existing developments2	—	—	11,007	11,007
Total development funding opportunities	—	—	11,746	49,295

Total investments	$20,046	$64,933	$16,501	$101,480
Total initial cash capitalization rate3	7.0%	7.3%	6.7%	7.1%
Total weighted average lease term (years)3	18.7	15.2	14.1	16.4
Total weighted average annual rent increase3	1.8%	1.9%	2.0%	1.9%

1 During the first quarter, we entered into an agreement under the terms of an existing lease to substitute two properties with a tenant in exchange for one new property of equal value. Property substitutions are not included in the acquisition/disposition activity, however will affect the total number of properties reported as of September 30, 2023.

2 Total unfunded investment commitments at September 30, 2023, include up to $157.2 million in development fundings and $11.0 million in revenue generating capital expenditures.

3 Due to the nature of development funding opportunities not generating revenue during construction, these developments are excluded from the calculation of total capitalization rates, weighted average lease terms, and rent increases.

Developments4

(square feet and dollars in thousands)

The following table summarizes the Company's current developments as of September 30, 2023:


Property	Property Type	Projected Rentable Square Feet	Start Date4	Target Completion Date4	Initial Purchase Price4	Estimated Project Development Costs4	Estimated Total Project Investment4	QTD Q3 2023 Investment	Cumulative Investment at 9/30/23	Estimated Stabilized Yield4	Estimated GAAP Capitalization Rate
Under Construction:
UNFI (8380 21st Street)	Industrial	1,016	5/2023	10/2024	$17,300	$187,500	$204,800	$11,007	$48,556	7.2%	8.3%
7 Brew (4845 S. Memorial Drive)	Restaurant	1	7/2023	10/2023	460	1,242	1,702	739	739	7.0%	7.8%
Total		1,017			$17,760	$188,742	$206,502	$11,746	$49,295	7.2%	8.3%

4 Refer to definitions and explanations appearing at the end of this supplemental document.

Dispositions1

(square feet and dollars in thousands)

The following table summarizes the Company's property disposition activity during 2023.


Q1 20231
Property Type	Number of Properties	Square Feet	Acquisition Price	Disposition Price	Net Book Value
Office2	1	282	$33,050	32,000	$30,881
Industrial	1	74	16,240	18,550	15,015
Restaurant	1	5	1,186	1,324	1,099
Total Properties	3	361	$50,476	$51,874	$46,995
Weighted average cash cap rate2					6.0%

Q2 2023
Property Type	Number of Properties	Square Feet	Acquisition Price	Disposition Price	Net Book Value
Office	1	58	$5,925	$3,000	$2,701
Industrial	2	601	$43,000	$61,950	$32,961
Retail	1	4	$3,454	$4,440	$2,719
Total Properties	4	663	$52,379	$69,390	$38,381
Weighted average cash cap rate					5.6%

Q3 2023
Property Type	Number of Properties	Square Feet	Acquisition Price	Disposition Price	Net Book Value
Industrial	2	298	$51,054	$62,300	$45,770
Total Properties	2	298	$51,054	$62,300	$45,770
Weighted average cash cap rate					6.2%

2023 Dispositions
Property Type	Number of Properties	Square Feet	Acquisition Price	Disposition Price	Net Book Value
Office2	2	340	$38,975	$35,000	$33,582
Industrial	5	973	$110,294	$142,800	$93,746
Retail	1	4	$3,454	$4,440	$2,719
Restaurant	1	5	1,186	1,324	1,099
Total Properties	9	1,322	$153,909	$183,564	$131,146
Weighted average cash cap rate2					5.9%

2 Sale of office asset executed simultaneously with a $7.5 million lease buyout for total proceeds of $39.5 million, representing an all-in cash capitalization rate of 6.1%. Amounts have been excluded from the weighted average cash capitalization rate due to the nature of the separate transactions.

Portfolio at a Glance: Key Metrics


	September 30, 2023	June 30, 2023	March 31, 2023	December 31, 2022	September 30, 2022
Properties1	800	801	801	804	790
U.S. States	44	44	44	44	44
Canadian Provinces	4	4	4	4	4
Total Annualized Base Rent	$390.0M	$391.0M	$389.5M	$389.1M	$371.9M
Total Rentable Sq. Footage	38.2M	38.5M	39.1M	39.1M	36.8M
Tenants	220	221	221	221	218
Brands	208	209	209	211	208
Industries	54	54	54	55	56
Occupancy (based on SF)	99.4%	99.4%	99.4%	99.4%	99.3%
Rent Collection	99.9%	99.9%	100.0%	99.9%	100.0%
Top 10 Tenant Concentration	19.4%	19.4%	19.2%	19.0%	17.1%
Top 20 Tenant Concentration	32.1%	32.1%	31.4%	31.4%	29.8%
Investment Grade (tenant/guarantor)	15.3%	15.3%	15.6%	15.4%	16.0%
Financial Reporting Coverage2	93.7%	94.2%	94.3%	94.3%	94.1%
Rent Coverage Ratio (Restaurants Only)	3.4x	3.3x	3.2x	3.2x	3.1x
Weighted Average Annual Rent Increases	2.0%	2.0%	2.0%	2.0%	2.0%
Weighted Average Remaining Lease Term	10.5 years	10.7 years	10.8 years	10.9 years	10.7 years
Master Leases (based on ABR)
Total Portfolio	41.6%	41.5%	41.2%	40.8%	37.7%
Multi-site tenants	69.3%	69.3%	69.3%	67.7%	65.4%

2 Includes 7.5%, 7.9%, 7.9%, 8.5%, and 8.8%, related to tenants not required to provide financial information under the terms of our lease, but whose financial statements are available publicly at September 30, 2023, June 30, 2023, March 31, 2023, December 31, 2022, and September 30, 2022.

Diversification: Tenants & Brands

Top 20 Tenants


Tenant	Property Type	# Properties		ABR ($'000s)		ABR as a % of Total Portfolio			Square Feet ('000s)		SF as a % of Total Portfolio
Roskam Baking Company, LLC*	Food Processing		7	$	15,605		4.0	%		2,250		5.9	%
AHF, LLC*	Distribution & Warehouse/Manufacturing		8		9,378		2.4	%		2,284		6.0	%
Jack's Family Restaurants LP*	Quick Service Restaurants		43		7,309		1.9	%		147		0.4	%
Joseph T. Ryerson & Son, Inc	Distribution & Warehouse		11		6,588		1.7	%		1,537		4.0	%
Red Lobster Hospitality & Red Lobster Restaurants LLC*	Casual Dining		19		6,302		1.6	%		157		0.4	%
Axcelis Technologies, Inc.	Flex and R&D		1		6,126		1.6	%		417		1.1	%
J. Alexander's, LLC*	Casual Dining		16		6,116		1.6	%		131		0.3	%
Salm Partners, LLC*	Food Processing		2		6,062		1.5	%		368		0.9	%
Hensley & Company*	Distribution & Warehouse		3		5,989		1.5	%		577		1.5	%
Dollar General Corporation	General Merchandise		60		5,968		1.5	%		562		1.5	%
Total Top 10 Tenants			170	$	75,443		19.3	%		8,430		22.0	%

BluePearl Holdings, LLC**	Animal Health Services		13	$	5,597		1.4	%		166		0.5	%
Krispy Kreme Doughnut Corporation	Quick Service Restaurants/ Food Processing		27		5,538		1.4	%		156		0.4	%
Outback Steakhouse of Florida LLC*	Casual Dining		22		5,365		1.4	%		140		0.4	%
Tractor Supply Company	General Merchandise		21		5,360		1.4	%		417		1.1	%
Big Tex Trailer Manufacturing Inc.*	Automotive/Distribution & Warehouse/Manufacturing/ Corporate Headquarters		17		5,056		1.3	%		1,302		3.4	%
Carvana, LLC*	Industrial Services		2		4,590		1.2	%		230		0.6	%
Klosterman Bakery*	Food Processing		11		4,568		1.2	%		549		1.4	%
Nestle' Dreyer's Ice Cream Company2	Cold Storage		1		4,543		1.2	%		309		0.8	%
Arkansas Surgical Hospital	Surgical		1		4,476		1.1	%		129		0.3	%
Chiquita Holdings Limited	Food Processing		1		4,420		1.1	%		335		0.9	%
Total Top 20 Tenants			286	$	124,956		32.0	%		12,163		31.8	%

1Nestle's ABR excludes $1.6 million of rent paid under a sub-lease for an additional property, which will convert to a prime lease no later than August, 2024

*Subject to a master lease.

**Includes properties leased by multiple tenants, some, not all, of which are subject to master leases.

Top 20 Tenant Descriptions1

Top 20 Tenant Descriptions1 (continued)

Top 20 Brands


Brand	Property Type	# Properties		ABR ($'000s)		ABR as a % of Total Portfolio			Square Feet ('000s)		SF as a % of Total Portfolio
Roskam Baking Company, LLC*	Food Processing		7	$	15,605		4.0	%		2,250		5.9	%
AHF Products*	Distribution & Warehouse/ Manufacturing		8		9,378		2.4	%		2,284		6.0	%
Jack's Family Restaurants*	Quick Service Restaurants		43		7,309		1.9	%		147		0.4	%
Ryerson	Distribution & Warehouse		11		6,588		1.7	%		1,537		4.0	%
Red Lobster*	Casual Dining		19		6,302		1.6	%		157		0.4	%
Axcelis	Flex and R&D		1		6,126		1.6	%		417		1.0	%
Salm Partners, LLC*	Food Processing		2		6,062		1.6	%		368		1.0	%
Hensley*	Distribution & Warehouse		3		5,989		1.5	%		577		1.5	%
Dollar General	General Merchandise		60		5,968		1.5	%		562		1.5	%
BluePearl Veterinary Partners**	Animal Health Services		13		5,599		1.4	%		165		0.4	%
Total Top 10 Brands			167	$	74,926		19.2	%		8,464		22.1	%

Krispy Kreme	Quick Service Restaurants/ Food Processing		27	$	5,537		1.4	%		158		0.6	%
Bob Evans Farms*	Casual Dining/Food Processing		21		5,459		1.4	%		281		0.7	%
Tractor Supply Company	General Merchandise		21		5,360		1.4	%		417		1.1	%
Big Tex Trailers*	Automotive/Distribution & Warehouse/Manufacturing/ Corporate Headquarters		17		5,056		1.3	%		1,302		3.4	%
Outback Steakhouse*	Casual Dining		20		4,641		1.2	%		126		0.3	%
Carvana*	Industrial Services		2		4,590		1.2	%		230		0.6	%
Klosterman Bakery*	Food Processing		11		4,568		1.2	%		549		1.4	%
Nestle'1	Cold Storage		1		4,543		1.2	%		309		0.8	%
Arkansas Surgical Hospital	Surgical		1		4,476		1.1	%		129		0.3	%
Chiquita Holdings Limited	Food Processing		1		4,420		1.1	%		335		0.9	%
Total Top 20 Brands			289	$	123,576		31.7	%		12,300		32.2	%

1Nestle's ABR excludes $1.6 million of rent paid under a sub-lease for an additional property, which will convert to a prime lease no later than August, 2024

*Subject to a master lease.

**Includes properties leased by multiple tenants, some, not all, of which are subject to master leases.

Diversification: Property Type

(rent percentages based on ABR)

Diversification: Property Type (continued)


Property Type	# Properties		ABR ($'000s)		ABR as a % of Total Portfolio			Square Feet ('000s)		SF as a % of Total Portfolio
Industrial
Manufacturing		80	$	65,375		16.8	%		12,178		31.8	%
Distribution & Warehouse		46		50,482		12.9	%		9,158		23.9	%
Food Processing		33		46,223		11.9	%		5,442		14.2	%
Flex and R&D		6		16,073		4.1	%		1,157		3.0	%
Industrial Services		23		11,805		3.0	%		607		1.6	%
Cold Storage		4		9,909		2.5	%		723		1.9	%
Untenanted		1		-		0.0	%		122		0.3	%
Industrial Total		193		199,867		51.2	%		29,387		76.7	%
Healthcare
Clinical		52		27,489		7.0	%		1,090		2.9	%
Healthcare Services		29		11,810		3.0	%		478		1.2	%
Animal Health Services		27		10,947		2.8	%		405		1.1	%
Surgical		12		10,502		2.7	%		329		0.9	%
Life Science		9		8,010		2.1	%		549		1.4	%
Healthcare Total		129		68,758		17.6	%		2,851		7.5	%
Restaurant
Casual Dining		101		27,586		7.1	%		673		1.8	%
Quick Service Restaurants		147		25,547		6.6	%		499		1.3	%
Restaurant Total		248		53,133		13.7	%		1,172		3.1	%
Retail
General Merchandise		132		24,934		6.4	%		1,865		4.9	%
Automotive		67		12,525		3.2	%		773		2.0	%
Home Furnishings		13		7,233		1.9	%		797		2.1	%
Child Care		2		731		0.1	%		20		0.1	%
Retail Total		214		45,423		11.6	%		3,455		9.1	%
Office
Strategic Operations		6		10,381		2.7	%		632		1.7	%
Corporate Headquarters		7		8,446		2.2	%		409		1.1	%
Call Center		2		4,013		1.0	%		288		0.7	%
Untenanted		1		—		—			46		0.1	%
Office Total		16		22,840		5.9	%		1,375		3.6	%
Total		800	$	390,021		100.0	%		38,240		100.0	%

Key Statistics by Property Type


	Q3 2023			Q2 2023			Q1 2023			Q4 2022			Q3 2022
Industrial
Number of properties		193			195			193			195			185
Square feet (000s)		29,387			29,686			30,142			29,947			27,631
Weighted average lease term (years)		11.5			11.8			11.9			11.2			11.2
Weighted average annual rent escalation		2.0	%		2.0	%		2.0	%		2.0	%		2.0	%
Percentage of total ABR		51.2	%		51.6	%		51.8	%		51.5	%		49.0	%

Healthcare
Number of properties		129			129			130			130			130
Square feet (000s)		2,851			2,852			2,870			2,870			2,869
Weighted average lease term (years)		6.8			6.8			7.0			8.2			8.2
Weighted average annual rent escalation		2.4	%		2.3	%		2.3	%		2.2	%		2.2	%
Percentage of total ABR		17.6	%		17.5	%		17.4	%		17.1	%		18.5	%

Restaurant
Number of properties		248			247			247			248			250
Square feet (000s)		1,172			1,172			1,172			1,177			1,191
Weighted average lease term (years)		13.9			14.1			14.3			14.8			14.8
Weighted average annual rent escalation		1.8	%		1.8	%		1.8	%		1.8	%		1.8	%
Percentage of total ABR		13.7	%		13.5	%		13.4	%		13.5	%		14.1	%

Retail
Number of properties		214			214			215			214			209
Square feet (000s)		3,455			3,455			3,459			3,448			3,411
Weighted average lease term (years)		9.7			10.0			10.2			10.5			10.5
Weighted average annual rent escalation		1.6	%		1.6	%		1.6	%		1.6	%		1.6	%
Percentage of total ABR		11.6	%		11.6	%		11.6	%		11.5	%		11.7	%

Office
Number of properties		16			16			16			17			16
Square feet (000s)		1,375			1,374			1,415			1,697			1,686
Weighted average lease term (years)		5.6			5.9			6.0			6.1			6.1
Weighted average annual rent escalation		2.5	%		2.5	%		2.5	%		2.5	%		2.5	%
Percentage of total ABR		5.9	%		5.8	%		5.8	%		6.4	%		6.7	%

Diversification: Tenant Industry


Industry	# Properties		ABR ($'000s)		ABR as a % of Total Portfolio			Square Feet ('000s)		SF as a % of Total Portfolio
Health Care Facilities		104	$	54,597		14.0	%		2,062		5.4	%
Restaurants		251		53,973		13.8	%		1,214		3.2	%
Packaged Foods & Meats		29		40,627		10.4	%		4,713		12.3	%
Distributors		27		16,185		4.1	%		2,695		7.0	%
Auto Parts & Equipment		44		15,535		4.0	%		2,710		7.1	%
Specialty Stores		31		14,362		3.7	%		1,338		3.5	%
Food Distributors		8		14,206		3.6	%		1,712		4.5	%
Home Furnishing Retail		18		12,787		3.3	%		1,858		4.9	%
Specialized Consumer Services		48		12,577		3.2	%		724		1.9	%
Metal & Glass Containers		8		10,229		2.6	%		2,206		5.8	%
General Merchandise Stores		96		9,647		2.5	%		880		2.3	%
Industrial Machinery		20		9,594		2.5	%		1,949		5.1	%
Forest Products		8		9,378		2.4	%		2,284		6.0	%
Health Care Services		18		9,342		2.4	%		515		1.3	%
Internet & Direct Marketing Retail		3		7,057		1.8	%		447		1.2	%
Other (39 industries)		85		99,925		25.7	%		10,709		27.9	%
Untenanted properties		2		—		—			224		0.6	%
Total		800	$	390,021		100.0	%		38,240		100.0	%

Diversification: Geography

(rent percentages based on ABR)


State / Province	# Properties	ABR ($'000s)	ABR as a % of Total Portfolio	Square Feet ('000s)	SF as a % of Total Portfolio	State / Province	# Properties	ABR ($'000s)	ABR as a % of Total Portfolio	Square Feet ('000s)	SF as a % of Total Portfolio
TX	72	$38,471	9.9%	3,621	9.5%	WA	15	$4,362	1.1%	150	0.4%
MI	55	32,678	8.3%	3,811	10.0%	LA	4	3,407	0.9%	194	0.5%
IL	32	24,336	6.1%	2,424	6.3%	MS	11	3,347	0.9%	430	1.1%
WI	35	23,318	5.9%	2,163	5.7%	NE	6	3,286	0.8%	509	1.3%
CA	13	19,411	5.0%	1,718	4.5%	SC	13	2,969	0.8%	308	0.8%
FL	42	16,256	4.2%	840	2.2%	IA	4	2,804	0.7%	622	1.6%
OH	47	16,253	4.2%	1,582	4.1%	NM	9	2,779	0.7%	107	0.3%
IN	32	16,216	4.2%	1,906	5.0%	CO	4	2,524	0.6%	126	0.3%
MN	21	15,566	4.0%	2,500	6.5%	UT	3	2,450	0.6%	280	0.7%
TN	50	15,426	4.0%	1,103	2.9%	MD	3	2,160	0.6%	205	0.5%
NC	36	12,465	3.2%	1,135	3.0%	CT	2	1,828	0.5%	55	0.1%
AL	53	12,203	3.1%	873	2.3%	ND	3	1,715	0.4%	48	0.1%
AZ	9	11,916	3.1%	909	2.4%	MT	7	1,582	0.4%	43	0.1%
GA	33	11,806	3.0%	1,576	4.1%	DE	4	1,180	0.3%	133	0.3%
PA	22	9,742	2.5%	1,836	4.8%	VT	2	426	0.1%	24	0.1%
NY	26	9,462	2.4%	680	1.8%	WY	1	307	0.1%	21	0.1%
KY	24	8,600	2.2%	900	2.4%	NV	1	268	0.1%	6	0.0%
OK	23	8,150	2.1%	987	2.6%	OR	1	136	0.0%	9	0.0%
AR	11	7,734	2.0%	283	0.7%	SD	1	81	0.0%	9	0.0%
MA	3	6,543	1.7%	444	1.2%	Total U.S.	793	$381,477	97.8%	37,810	98.8%
MO	12	6,231	1.6%	1,138	3.0%	BC	2	$4,993	1.2%	253	0.7%
KS	11	5,660	1.5%	648	1.7%	ON	3	2,168	0.6%	101	0.3%
VA	17	5,521	1.4%	204	0.5%	AB	1	1,019	0.3%	51	0.1%
WV	17	4,993	1.3%	884	2.3%	MB	1	364	0.1%	25	0.1%
NJ	3	4,909	1.3%	366	1.0%	Total Canada	7	$8,544	2.2%	430	1.2%
						Grand Total	800	$390,021	100.0%	38,240	100.0%

Lease Expirations

(rent percentages based on ABR)


Expiration Year	# Properties		# Leases		ABR ($'000s)		ABR as a % of Total Portfolio			Square Feet ('000s)		SF as a % of Total Portfolio
2023		3		4	$	3,730		1.0	%		467		1.2	%
2024		5		5		6,438		1.7	%		741		1.9	%
2025		19		21		7,070		1.8	%		394		1.0	%
2026		34		35		17,728		4.5	%		1,150		3.0	%
2027		29		30		24,835		6.5	%		2,079		5.5	%
2028		36		37		22,984		5.9	%		1,930		5.0	%
2029		73		74		23,794		6.1	%		2,754		7.2	%
2030		100		100		54,288		13.9	%		5,022		13.1	%
2031		33		33		8,707		2.2	%		805		2.1	%
2032		62		63		32,100		8.2	%		3,469		9.1	%
2033		50		50		19,293		4.9	%		1,593		4.2	%
2034		34		34		6,766		1.7	%		446		1.2	%
2035		19		19		13,857		3.6	%		2,021		5.3	%
2036		88		88		27,549		7.1	%		2,952		7.7	%
2037		22		22		16,848		4.3	%		1,120		3.0	%
2038		38		38		10,854		2.8	%		848		2.2	%
2039		11		11		7,988		2.0	%		928		2.4	%
2040		31		31		5,877		1.5	%		312		0.8	%
2041		40		40		22,393		5.7	%		1,731		4.5	%
2042		59		59		44,189		11.3	%		4,813		12.6	%
Thereafter		12		12		12,733		3.3	%		2,441		6.4	%
Untenanted properties		2		—		—		—			224		0.6	%
Total		800		806	$	390,021		100.0	%		38,240		100.0	%

Occupancy

Occupancy by Rentable Square Footage

Change in Occupancy


	Number of properties
Vacant properties at January 1, 2023		3
Lease expirations1		2
Leasing activities		(3	)
Vacant dispositions		—
Vacant properties at March 31, 2023		2
Lease expirations1		3
Leasing activities		(3	)
Vacant dispositions		—
Vacant properties at June 30, 2023		2
Lease expirations1		3
Leasing activities		(3	)
Vacant dispositions		—
Vacant properties at September 30, 2023		2

1 Includes scheduled and unscheduled expirations (including leases rejected in bankruptcy), as well as future expirations resolved in the periods indicated above.

Definitions and Explanations

Adjusted NOI, Annualized Adjusted NOI, Adjusted Cash NOI and Annualized Adjusted Cash NOI: Our reported results and net earnings per diluted share are presented in accordance with accounting principles generally accepted in the United States of America (GAAP). Adjusted NOI and Adjusted Cash NOI are non-GAAP financial measures that we believe are useful to assess property-level performance. We compute Adjusted NOI by adjusting Adjusted EBITDAre (defined below) to exclude general and administrative expenses incurred at the corporate level. Given the net lease nature of our portfolio, we do not incur general and administrative expenses at the property level. To compute Adjusted Cash NOI, we adjust Adjusted NOI to exclude non-cash items included in total revenues and property expenses, such as straight-line rental revenue and other amortization and non-cash items, based on an estimate calculated as if all investment and disposition activity that took place during the quarter had occurred on the first day of the quarter. We then annualize quarterly Adjusted NOI and Adjusted Cash NOI by multiplying each amount by four to compute Annualized Adjusted NOI and Annualized Adjusted Cash NOI, respectively, which are also non-GAAP financial measures. We believe Adjusted NOI and Adjusted Cash NOI provide useful and relevant information because they reflect only those income and expense items that are incurred at the property level and present such items on an unlevered basis. We believe that the exclusion of certain non-cash revenues and expenses from Adjusted Cash NOI is a useful supplemental measure for investors to consider because it will help them to better assess our operating performance without the distortions created by non-cash revenues or expenses. You should not unduly rely on Annualized Adjusted NOI and Annualized Adjusted Cash NOI as they are based on assumptions and estimates that may prove to be inaccurate. Our actual reported Adjusted NOI and Adjusted Cash NOI for future periods may be significantly different from our Annualized Adjusted NOI and Annualized Adjusted Cash NOI. Additionally, our computation of Adjusted NOI and Adjusted Cash NOI may differ from the methodology for calculating these metrics used by companies in our industry, and, therefore, may not be comparable to similarly titled measures reported by other companies.

Adjusted Secured Overnight Financing Rate (SOFR): We define Adjusted SOFR as the current one month term SOFR plus an adjustment of 0.10% per the terms of our credit facilities.

Annualized Base Rent (ABR): We define ABR as the annualized contractual cash rent due for the last month of the reporting period, excluding the impacts of short-term rent deferrals, abatements, or free rent, and adjusted to remove rent from properties sold during the month and to include a full month of contractual cash rent for investments made during the month.

Cash Capitalization Rate: Cash Capitalization Rate represents either (1) for acquisitions and new developments, the estimated first year cash yield to be generated on a real estate investment, which was estimated at the time of investment based on the contractually specified cash base rent for the first full year after the date of the investment, divided by the purchase price for the property excluding capitalized acquisitions costs, or (2) for disposition properties, the estimated first year cash yield to be generated subsequent to disposition based on contractually specified cash base rent divided by the disposition price.

EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre: EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre are non-GAAP financial measures. We compute EBITDA as earnings before interest, income taxes and depreciation and amortization. EBITDA is a measure commonly used in our industry. We believe that this ratio provides investors and analysts with a measure of our performance that includes our operating results unaffected by the differences in capital structures, capital investment cycles and useful life of related assets compared to other companies in our industry. We compute EBITDAre in accordance with the definition adopted by Nareit. Nareit defines EBITDAre as EBITDA excluding gains (loss) from the sales of depreciable property and provisions for impairment on investment in real estate. We believe EBITDA and EBITDAre are useful to investors and analysts because they provide important supplemental information about our operating performance exclusive of certain non-cash and other costs. Adjusted EBITDAre represents EBITDAre, adjusted to reflect revenue producing investments and dispositions for the quarter as if such investments and dispositions had occurred at the beginning of the quarter, and to exclude certain GAAP income and expense amounts that are either non-cash, such as cost of debt extinguishments, realized or unrealized gains and losses on foreign currency transactions, or gains on insurance recoveries, or that we believe are one time, or unusual in nature because they relate to unique circumstances or transactions that had not previously occurred and which we do not anticipate occurring in the future, and to eliminate the impact of lease termination fees, and other items that are not a result of normal operations. While investments in developments have an immediate impact to Net Debt, we do not make an adjustment to EBITDAre until the quarter in which the lease commences. We then annualize quarterly Adjusted EBITDAre by multiplying it by four to compute Annualized Adjusted EBITDAre. Our reported EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre may not be comparable to similarly titled measures of other companies. You should not consider these measures as alternatives to net income or cash flows from operating activities determined in accordance with GAAP.

Funds From Operations (FFO), Core Funds From Operations (Core FFO), and Adjusted Funds From Operations (AFFO): FFO, Core FFO, and AFFO are non-GAAP measures. We believe the use of FFO, Core FFO, and AFFO are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs. FFO, Core FFO, and AFFO should not be considered alternatives to net income as a performance measure or to cash flows from operations, as reported on our statement of cash flows, or as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures. We compute Core FFO by adjusting FFO to exclude certain GAAP income and expense amounts that we believe are infrequently recurring, unusual in nature, or not related to its core real estate operations, including write-offs or recoveries of accrued rental income, lease termination fees, the gain on insurance recoveries, cost of debt extinguishments, unrealized and realized gains or losses on foreign currency transactions, severance and executive transition costs, and other extraordinary items. We compute AFFO by adjusting Core FFO for certain non-cash revenues and expenses, including straight-line rents, amortization of lease intangibles, amortization of debt issuance costs, amortization of net mortgage premiums, (gain) loss on interest rate swaps and other non-cash interest expense, stock-based compensation, and other specified non-cash items.

Definitions and Explanations (continued)

GAAP Capitalization Rate: GAAP Capitalization Rate represents the estimated first year GAAP yield to be generated on a real estate investment, which was computed at the time of investment based on the first full year of rental income computed in accordance with GAAP, divided by the purchase price including capitalized costs for the property.

Gross Debt: We define Gross Debt as total debt plus debt issuance costs and original issuance discount.

Net Debt: Net Debt is a non-GAAP financial measure. We define Net Debt as our Gross Debt less cash and cash equivalents and restricted cash.

Occupancy: Occupancy or a specified percentage of our portfolio that is "occupied" or "leased" means as of a specified date the quotient of (1) the total rentable square footage of our properties minus the square footage of our properties that are vacant and from which we are not receiving any rental payment, and (2) the total square footage of our properties.

Rent Coverage Ratio: Rent Coverage Ratio means the ratio of tenant-reported or, when available, management's estimate, based on tenant-reported financial information, of annual earnings before interest, taxes, depreciation, amortization, and cash rent attributable to the leased property (or properties, in the case of a master lease) to the annualized base rental obligation as of a specified date.

Definitions Related to Development Properties:

•

Initial Purchase Price: Initial Purchase Price represents the initial contractual price of the property, typically representing purchase of undeveloped land or properties, including closing costs.

•

Estimated Project Development Costs: Represents the estimated costs to be incurred to complete development of each project. We expect to update our estimates upon completion of the project, or sooner if there are any significant changes to expected costs from quarter to quarter. Excludes capitalized costs consisting of capitalized interest and other acquisition costs.

•

Estimated Total Project Investment: Represents the sum of the Initial Purchase Price and the Estimated Project Development Costs.

•

Estimated Stabilized Yield: Calculated by dividing the estimated first year cash yield to be generated on a real estate investment by the Estimated Total Project Investment for the property.

•

Start Date: The Start Date represents the period in which we have begun physical construction on a property.

•

Target Completion Date: The Target Completion Date is our current estimate of the period in which we will have substantially completed a project and the project is made available for occupancy. We expect to update our timing estimates on a quarterly basis.