VEREIT (VER) 8-K American Realty Capital Properties, Inc., Safari Acquisition, LLC and Thunder Acquisition, LLC

THE COMPANIES

American Realty Capital Properties, Inc., Safari Acquisition, LLC and Thunder Acquisition, LLC

American Realty Capital Properties, Inc., or ARCP, is a Maryland corporation incorporated in December 2010 that qualified as a real estate investment trust for U.S. federal income tax purposes, or REIT, commencing with its initial taxable year ended December 31, 2011. In July 2011, ARCP commenced an initial public offering on a “reasonable best efforts” basis, which closed on September 6, 2011. ARCP common stock began trading on the NASDAQ Capital Market under the symbol “ARCP” on September 7, 2011. On February 28, 2013, ARCP merged with American Realty Capital Trust III, Inc., a Maryland corporation, or ARCT III. Following its acquisition of ARCT III and commencing with trading on March 1, 2013, ARCP common stock began trading on the NASDAQ Global Select Market.

Substantially all of ARCP’s business is conducted through ARC Properties Operating Partnership, L.P., or the ARCP OP, of which ARCP is the sole general partner.

ARCP acquires, owns and operates single-tenant, freestanding commercial real estate properties. ARCP has acquired a combination of long-term and medium-term leases and intends to continue to acquire properties with approximately 70% long-term leases and 30% medium-term leases, with an average remaining lease term of 10 to 12 years. ARCP considers properties that are leased on a “medium-term” basis to mean properties originally leased long-term (ten years or longer) that currently have a primary remaining lease duration of generally three to eight years, on average. ARCP expects this investment strategy to develop growth potential from below market leases. Additionally, ARCP owns a portfolio that uniquely combines a portfolio of properties with stable income from high credit quality tenants, with properties that have substantial growth opportunities.

As of March 31, 2013, excluding one vacant property classified as held for sale, ARCP owned 701 properties consisting of 16.7 million square feet, 100% leased with a weighted average remaining lease term of 11.1 years. In constructing its portfolio, ARCP is committed to diversification (industry, tenant and geography). As of March 31, 2013, rental revenues derived from investment grade tenants and tenants affiliated with investment grade entities as determined by a major rating agency approximated 79% (the rating of each parent company has been attributed to its wholly owned subsidiary for purposes of this disclosure). ARCP’s strategy encompasses receiving the majority of its revenue from investment grade tenants as ARCP further acquires properties and enters into (or assumes) medium-term and long-term lease arrangements.

ARCP’s principal executive offices are located at 405 Park Avenue, 15^thFloor, New York, New York 10022, and its telephone number is (212) 415-6500.

The entity into which CapLease (as defined and described below) will merge, Safari Acquisition, LLC, or the CapLease Merger Sub, is a Delaware limited liability company and a direct wholly owned subsidiary of ARCP that was formed for the purpose of acquiring CapLease pursuant to the merger agreement with CapLease.

The entity into which ARCT IV (as defined and described below) will merge, Thunder Acquisition, LLC, or the ARCT IV Merger Sub, is a Delaware limited liability company and a direct wholly owned subsidiary of ARCP that was formed for the purpose of acquiring ARCT IV pursuant to the merger agreement with ARCT IV.

CapLease, Inc.

CapLease, Inc., or CapLease, is a REIT that primarily acquires, owns and manages a diversified portfolio of single tenant commercial real estate properties subject to long-term leases to high credit quality tenants. CapLease focuses on properties that are subject to a lease that requires the tenant to pay all or substantially all property operating expenses, such as utilities, real estate taxes, insurance and routine maintenance. CapLease has made an election to qualify, and believes it is operating so as to qualify, as a REIT commencing with its taxable year ended December 31, 2004. In addition to its portfolio of owned properties, CapLease has a modest portfolio of first mortgage loans and other debt investments on single tenant properties.

CapLease conducts its business through a variety of subsidiaries. CapLease owns most of its owned properties through its predecessor and operating partnership, Caplease, LP. CapLease is the indirect sole general partner of, and owns approximately 99.8% of the common equity of, CapLease, LP.

As of March 31, 2013, excluding one vacant property, CapLease owned 70 properties comprised of 12.0 million square feet, which were 96.6% leased with a weighted average remaining lease term of approximately 6.0 years.

CapLease’s principal executive offices are located at 1065 Avenue of the Americas, New York, New York 10018, and its telephone number is (212) 217-6300.

GE Capital Portfolio

On June 27, 2013 ARCP, through the ARCP OP, acquired the equity interests in the entities that own a real estate portfolio comprised of 447 net lease properties, or the GE Capital Portfolio, from certain affiliates of GE Capital Corp., or GE Capital. The 447 properties are subject to 400 property operating leases and 47 direct financing leases. The GE Capital Portfolio contains approximately 2.0 million rentable square feet and consists of 444 restaurants (including three other revenue generating assets) and three retail properties. The purchase price for the GE Capital Portfolio was approximately $774 million exclusive of closing costs.

American Realty Capital Trust IV, Inc.

American Realty Capital Trust IV, Inc., or ARCT IV, is a Maryland corporation incorporated in February 2012 that qualifies as a REIT for U.S. federal income tax proposes commencing with its initial taxable year ended December 31, 2012. ARCT IV is a non-traded REIT. ARCT IV was formed to acquire a diversified portfolio of commercial real estate, which consists primarily of freestanding single tenant properties net leased to investment grade and other credit worthy tenants. In June 2012, ARCT IV commenced an initial public offering on a ‘‘reasonable best efforts’’ basis to sell up to 60.0 million shares of common stock, excluding 10.0 million shares issuable pursuant to a distribution reinvestment plan, offered at a price of $25.00 per share, subject to certain volume and other discounts, which we refer to as the ARCT IV IPO. In September 2012, ARCT IV commenced real estate operations. As of July 2, 2013, ARCT IV had issued 70,219,528 million shares of ARCT IV common stock in connection with the ARCT IV IPO and had issued 885,216 million shares of ARCT IV common stock under its distribution reinvestment plan. As of July 2, 2013, ARCT IV had 71,112,745 shares of common stock outstanding, including unvested restricted shares and shares issued pursuant to ARCT IV’s distribution reinvestment plan.

Substantially all of ARCT IV’s business is conducted through American Realty Capital Operating Partnership IV, L.P., a Delaware limited partnership and the operating partnership of ARCT IV, or the ARCT IV Operating Partnership, of which ARCT IV is the sole general partner.

As of June 30, 2013, ARCT IV owned 585 properties comprised of 6.6 million square feet, which were 100% leased with a weighted average remaining lease term of 11.7 years. Additionally, ARCT IV is party to a purchase and sale agreement with certain affiliates of GE Capital pursuant to which 578 properties remain to be acquired by ARCT IV thereunder. In constructing the portfolio, ARCT IV has been committed to diversification by industry, tenant and geography.

ARCT IV’s principal executive offices are located at 405 Park Avenue, 15th Floor, New York, New York 10022, and its telephone number is (212) 415-6500.

ARCT IV and ARCP each were sponsored directly by AR Capital, LLC, or ARC. American Realty Capital Advisors IV, LLC, or the ARCT IV Advisor, is a Delaware limited liability company indirectly wholly owned by ARC and is ARCT IV’s external advisor. ARC Properties Advisors, LLC, or the ARCP Manager, is a Delaware limited liability company wholly owned by ARC and is ARCP’s external manager. ARC and its affiliates, including the ARCT IV Advisor and ARCP Manager, provide investment, management and advisory services, as well as certain acquisition and debt capital services to ARCT IV and ARCP, as applicable. ARCT IV and ARCP pay management fees and certain other fees to, and reimburse certain expenses of, the ARCT IV Advisor and ARCP Manager, respectively. Affiliates of ARC also provide similar services for American Realty Capital New York Recovery REIT, Inc., Phillips Edison — ARC Shopping Center REIT Inc., American Realty Capital — Retail Centers of America, Inc., American Realty Capital Healthcare Trust, Inc., American Realty Capital Daily Net Asset Value Trust, Inc., ARC Realty Financial Trust, Inc., American Realty Capital Global Trust, Inc., American Realty Capital Healthcare Trust II, Inc. and American Realty Capital Trust V, Inc. Certain of these ARC-sponsored REITs have investment strategies substantially similar to those of ARCT IV, ARCP and the combined company.

Combination of ARCP, CapLease, the GE Capital Portfolio and ARCT IV

Combination of ARCP and CapLease

As of March 31, 2013, excluding one vacant property classified as held for sale, ARCP’s portfolio was comprised of 701 properties consisting of 16.7 million rentable square feet, 100% leased with a weighted average remaining lease term of 11.1 years. As of March 31, 2013, excluding one vacant property CapLease owned 70 properties comprised of 12.0 million square feet, which were 96.6% leased with a weighted average remaining lease term of approximately 6.0 years.

ARCP and CapLease are each focused on creating a portfolio of primarily net lease properties leased to high credit quality tenants. ARCP focuses on acquiring properties with both medium-term and long-term leases. CapLease’s portfolio, which has a weighted average remaining lease term on a portfolio basis as of March 31, 2013 of 6.0 years, fits within the medium-term lease component of ARCP’s strategy.

Following the CapLease Merger, the combined company will own a portfolio that combines CapLease’s portfolio of properties that are substantially net leased to investment grade tenants as determined by major credit rating agencies (including the attribution of such ratings to affiliates of CapLease’s tenants) which contain growth opportunities with ARCP’s portfolio, which retains a balance of growth opportunities and security and is also substantially leased to investment grade tenants as determined by major credit rating agencies (including the attribution of such ratings to affiliates of ARCP’s tenants). The combined portfolio will be diversified by geography, tenant and industry. The combination will reduce ARCP’s current top ten tenant concentration.

ARCP’s Acquisition of the GE Capital Portfolio

ARCP’s acquisition of the GE Capital Portfolio added 2.0 million rentable square feet to ARCP’s portfolio, which totaled 19.4 million rentable square feet including the GE Capital Portfolio, as of June 30, 2013. The GE Capital Portfolio is highly diversified by tenant and includes 123 distinct tenant groups. The GE Capital Portfolio is highly concentrated in the retail sector, adding to ARCP’s continued focus on building a single tenant net lease portfolio leased to commercial tenants. Annualized rental income as of June 30, 2013 for the GE Capital Portfolio separately, ARCP separately, and ARCP and the GE Capital Portfolio together are approximately $53.2 million, $174.6 million, and $227.8 million, respectively. The acquisition increased ARCP’s current industry diversification by expanding in the restaurant industry.

Combination of ARCP and ARCT IV

As of June 30, 2013, (excluding one vacant property classified as held for sale) ARCP owned 1,181 properties consisting of 19.4 million square feet, 100% leased with a weighted average remaining lease term of 9.9 years. As of June 30, 2013, ARCT IV owned 585 properties comprised of 6.6 million square feet, which were 100% leased with a weighted average remaining lease term of 11.7 years. Additionally, ARCT IV is party to a purchase and sale agreement with certain affiliates of GE Capital pursuant to which 578 properties remain to be acquired by ARCT IV thereunder. No assurance can be given that ARCT IV will acquire such properties. In constructing the portfolio, ARCT IV has been committed to diversification by industry, tenant and geography.

ARCP and ARCT IV are each focused on creating a portfolio of primarily net lease properties leased to high credit quality tenants. ARCP focuses on acquiring properties with both medium-term and long-term leases. ARCT IV’s portfolio, which has a weighted average remaining lease term on a portfolio basis as of June 30, 2013 of 11.7 years, fits within the long-term lease component of ARCP’s strategy.

Following the ARCT IV Merger, the combined company will own a portfolio that combines ARCT IV’s portfolio of properties that are substantially net leased to investment grade tenants as determined by major credit rating agencies (including the attribution of such ratings to affiliates of ARCT IV’s tenants) which are stable with ARCP’s portfolio, which retains a balance of growth opportunities and security and is also substantially leased to investment grade tenants as determined by major credit rating agencies (including the attribution of such ratings to affiliates of ARCP’s tenants). The combined portfolio will be diversified by geography, tenant and industry. The combination will reduce ARCP’s current top ten tenant concentration.

In connection with the ARCT IV Merger, ARCP entered into a letter agreement for proxy solicitation services with RCS Advisory Services, LLC, or RCS, RCS Capital Securities, LLC, or RC Securities, and American National Stock Transfer, LLC, or ANST, pursuant to which it will pay $640,000 for such services. Additionally, in connection with the ARCT IV Merger, ARCP entered into an agreement for financial advisory and strategic services with RC Securities, pursuant to which it will pay RC Securities an amount equal to 0.25% of the transaction value of the ARCT IV Merger. Each of RCS, RC Securities and ANST is an entity directly or indirectly under common control with ARC, the sponsor of ARCP and ARCT IV.

Combination of ARCP, CapLease, the GE Capital Portfolio and ARCT IV

As of June 30, 2013, the combined portfolio of ARCP, CapLease, the GE Capital Portfolio and ARCT IV (including the pending properties to be acquired from GE Capital) totals 2,414 properties containing 40.0 million rentable square feet with a pro forma weighted average lease term of 9.3 years, providing a balance between medium-term and long-term leases. Annualized rental revenues for the portfolios as of June 30, 2013 for ARCP, CapLease and the GE Capital Portfolio together total approximately $508.4 million.

Property Portfolio Information

At June 30, 2013, ARCP, excluding properties owned by CapLease, owned a diversified portfolio:

• of 1,181 properties, excluding one vacant property classified as held for sale;

• with an occupancy rate of 100%;

• leased to 180 different retail and other commercial enterprises doing business in 21 separate industries;

• located in 48 states and Puerto Rico;

• with approximately 19.4 million square feet of leasable space; and

• with an average leasable space per property of approximately 16,400 square feet.

At June 30, 2013, ARCP, including properties owned by CapLease (assuming the CapLease Merger is consummated), on a pro forma basis, owned a diversified portfolio:

• of 1,251 properties, excluding two vacant properties, one of which is classified as held for sale;

• with an occupancy rate of 96%;

• leased to 220 different retail and other commercial enterprises doing business in 29 separate industries;

• located in 48 states and Puerto Rico;

• with approximately 31.4 million square feet of leasable space; and

• with an average leasable space per property of approximately 25,100 square feet.

At June 30, 2013, ARCT IV, excluding properties under contract to be acquired from affiliates of GE Capital, owned a diversified portfolio:

• of 585 properties;

• with an occupancy rate of 100%;

• leased to 172 different retail and other commercial enterprises doing business in five separate industries;

• located in 42 states;

• with approximately 6.6 million square feet of leasable space; and

• with an average leasable space per property of approximately 11,200 square feet.

At June 30, 2013, ARCT IV, including properties under contract to be acquired from GE Capital, on a pro forma basis, owned a diversified portfolio:

• of 1,163 properties;

• with an occupancy rate of 100%;

• leased to 287 different retail and other commercial enterprises doing business in 23 separate industries;

• located in 46 states and the District of Columbia;

• with approximately 8.6 million square feet of leasable space; and

• with an average leasable space per property of approximately 7,400 square feet.

Combined Property Portfolio

As of June 30, 2013, ARCP (assuming the CapLease Merger is consummated) and ARCT IV, on a pro forma basis, owned a portfolio with the following characteristics:

• 1,836 properties, including 1,251 ARCP properties at June 30, 2013 and 585 ARCT IV properties at June 30, 2013;

• occupancy rate of 100%;

• leased to 355 different retail and other commercial enterprises doing business in 32 separate industries;

• located in 49 states and Puerto Rico;

• approximately 38.0 million square feet of leasable space; and

• an average leasable space per property of approximately 20,700 square feet.

As of June 30, 2013, ARCP and ARCT IV, including CapLease and properties under contract to be acquired from GE Capital, on a pro forma basis, owned a portfolio with the following characteristics:

• 2,414 properties, including 1,251 ARCP properties, 585 ARCT IV properties, 70 CapLease properties and 578 properties under contract with GE Capital at June 30, 2013;

• occupancy rate of 97%;

• leased to 454 different retail and other commercial enterprises doing business in 34 separate industries;

• located in 49 states, the District of Columbia and Puerto Rico;

• approximately 40.0 million square feet of leasable space; and

• an average leasable space per property of approximately 16,500 square feet.

There were no tenants whose annualized rental income on a straight-line basis represent greater than 10% of the total annualized rental income on a straight-line basis for the pro forma portfolio properties of ARCP and ARCT IV as of June 30, 2013.

All of the following property portfolio information is provided to illustrate the pro forma combined property portfolio of ARCP and ARCT IV post-merger. This information includes an illustration of the combined portfolio by industry, property type and geography, as well as a combined lease expiration schedule. The ARCP information represents quarterly information for the 1,251 properties owned, including properties owned by CapLease (which assumes the CapLease Merger is consummated), at June 30, 2013. The ARCT IV information represents quarterly information for the 585 properties owned at June 30, 2013. The ARCT IV (GE Capital) information represents 578 properties remaining to be acquired under ARCT IV’s purchase agreement with GE Capital at June 30, 2013.

Industry Diversification

The following table sets forth certain information regarding the property portfolios classified according to the business of the respective tenants, expressed as a percentage of total rental revenue:

Percentage of Rental Revenue

Industry	ARCP(1)			ARCT IV(2)			CapLease(3)			ARCT IV (GE Capital)(4)			Combined Total
Advertising		0.00	%		—			—			0.01	%		0.00	%
Aerospace		1.10	%		—			—			—			0.49	%
Auto Manufacturing		—			7.36	%		—			—			1.19	%
Auto Retail		2.45	%		0.40	%		2.71	%		—			1.89	%
Auto Services		0.27	%		0.44	%		—			—			0.19	%
Casual Dining		6.84	%		8.92	%		—			33.20	%		8.54	%
Consulting		—			—			3.64	%		—			0.98	%
Consumer Goods		0.28	%		9.87	%		—			—			1.72	%
Consumer Products		10.99	%		3.13	%		8.31	%		—			7.66	%
Discount Retail		10.90	%		5.81	%		4.50	%		—			7.03	%
Diversified Industrial		—			—			8.25	%		—			2.22	%
Family Dining		7.06	%		6.35	%		—			12.30	%		5.68	%
Financial Services		0.56	%					7.51	%		0.10	%		2.28	%
Freight		7.04	%		1.39	%		—			—			3.38	%
Gas/Convenience		3.18	%		1.36	%		—			—			1.65	%
Government Services		2.56	%		—			13.32	%		—			4.73	%
Haircare Services		—			0.03	%		—			—			0.00	%
Healthcare		5.74	%		3.18	%		4.04	%		0.10	%		4.18	%
Home Maintenance		0.99	%		1.01	%		4.38	%		—			1.78	%
Hotel		—			—			2.09	%		—			0.56	%
Insurance		4.75	%		—			13.99	%		0.10	%		5.90	%
Media		—			—			1.97	%		—			0.53	%
Motor Cycle		—			—			—			1.40	%		0.17	%
Oil & Gas		—			—			3.11	%		—			0.84	%
Parking		—			—			—			0.10	%		0.01	%
Pharmacy		8.78	%		1.09	%		0.81	%		—			4.33	%
Publishing		—			—			1.16	%		—			0.31	%
Quick Service Restaurant		12.10	%		26.48	%		—			52.69	%		16.12	%
Retail Banking		9.11	%		15.12	%		1.56	%		—			6.94	%
Specialty Retail		4.59	%		7.98	%		4.53	%		—			4.56	%
Storage Facility		0.19	%		—			—			—			0.09	%
Supermarket		0.52	%		—			4.84	%		—			1.54	%
Telecommunications		—			0.08	%		5.23	%		—			1.42	%
Various		—			—			4.05	%		—			1.09	%
Total		100.0%			100.0%			100.0%			100.0%			100.0%

(1) Includes annualized rental revenue for all properties owned by ARCP at June 30, 2013.

(2) Includes annualized rental revenue for all properties owned by ARCT IV at June 30, 2013.

(3) Includes annualized rental revenue for all properties owned by CapLease at June 30, 2013.

(4) Includes annualized rental revenue for all properties under contract to be acquired by ARCT IV from GE Capital at June 30, 2013.

Property Type Diversification

The following table sets forth certain property type information regarding the property portfolios (dollars in thousands):

ARCP

Property Type	Number of Properties		Approximate Leasable Square Feet		Annualized Rental Revenue		Percentage of Rental Revenue
Retail		1,100		7,609,157		143,757		63.1	%
Office		35		1,992,555		33,275		14.6	%
Distribution		46		9,802,884		50,732		22.3	%
Total		1,181		19,404,596		227,764		100%

ARCT IV

Property Type	Number of Properties		Approximate Leasable Square Feet		Annualized Rental Revenue		Percentage of Rental Revenue
Retail		581		4,139,912		65,342		79.6	%
Distribution		3		2,430,535		16,706		20.4	%
Parking Lot		1		8,400		1		0.0	%
Total		585		6,578,847		82,049		100%

CAPLEASE

Property Type	Number of Properties		Approximate Leasable Square Feet		Annualized Rental Revenue		Percentage of Rental Revenue
Retail		16		1,172,481		13,720		10.0	%
Office		44		6,206,297		101,017		73.9	%
Distribution		10		4,621,011		22,045		16.1	%
Total		70		11,999,789		136,782		100%

ARCT IV (GE Capital)

Property Type	Number of Properties		Approximate Leasable Square Feet		Annualized Rental Revenue		Percentage of Rental Revenue
Retail		572		1,964,827		61,741		99.8	%
Parking Lot		1		17,446		35		0.1	%
Billboard		5		2,463		59		0.1	%
Total		578		1,984,736		61,835		100%

COMBINED

Property Type	Number of Properties		Approximate Leasable Square Feet		Annualized Rental Revenue		Percentage of Rental Revenue
Retail		2,269		14,886,377		284,559		56.0	%
Office		79		8,198,852		134,292		26.4	%
Distribution		59		16,854,430		89,483		17.6	%
Parking Lot		2		25,846		36		0.0	%
Billboard		5		2,463		59		0.0	%
Total		2,414		39,967,968		508,430		100%

Geographic Diversification

The following table sets forth certain state-by-state information regarding the property portfolios (dollars in thousands):

ARCP

State	Number of Properties		Leasable Square Feet		Annualized Rental Revenue(1)		Percentage of Rental Revenue
Alabama		43		578,951		8,122		3.6	%
Arizona		8		74,227		1,613		0.7	%
Arkansas		18		250,618		3,652		1.6	%
California		16		1,450,328		12,488		5.5	%
Colorado		13		238,886		4,673		2.1	%
Connecticut		10		37,126		1,184		0.5	%
Delaware		4		12,369		286		0.1	%
Florida		36		188,676		5,366		2.4	%
Georgia		64		403,579		8,896		3.9	%
Idaho		8		71,565		1,552		0.7	%
Illinois		42		1,486,911		19,123		8.4	%
Indiana		28		1,762,150		8,288		3.6	%
Iowa		19		671,074		4,810		2.1	%
Kansas		22		1,305,125		4,611		2.0	%
Kentucky		27		263,260		4,629		2.0	%
Louisiana		28		221,238		2,871		1.3	%
Maine		2		146,430		2,819		1.2	%
Maryland		2		11,205		366		0.2	%
Massachusetts		18		435,195		6,157		2.7	%
Michigan		78		677,709		12,674		5.6	%
Minnesota		11		200,487		1,693		0.7	%
Mississippi		36		1,380,764		8,327		3.7	%
Missouri		86		942,859		11,019		4.8	%
Montana		5		55,377		856		0.4	%
Nebraska		3		25,355		409		0.2	%
Nevada		12		100,660		2,414		1.1	%
New Hampshire		10		65,328		1,349		0.6	%
New Jersey		8		85,721		2,640		1.2	%
New Mexico		10		54,475		870		0.4	%
New York		25		326,461		7,522		3.3	%
North Carolina		54		1,123,948		10,840		4.8	%
North Dakota		4		31,318		572		0.3	%
Ohio		63		1,197,640		10,754		4.7	%
Oklahoma		22		370,185		2,882		1.3	%
Oregon		6		25,143		652		0.3	%
Pennsylvania		69		365,231		8,697		3.8	%
Puerto Rico		2		31,050		1,105		0.5	%
Rhode Island		5		23,488		636		0.3	%
South Carolina		30		649,029		6,920		3.0	%
South Dakota		2		49,641		415		0.2	%
Tennessee		48		362,779		6,526		2.9	%
Texas		127		983,549		15,322		6.7	%
Utah		3		14,009		415		0.2%

State	Number of Properties		Leasable Square Feet		Annualized Rental Revenue(1)		Percentage of Rental Revenue
Vermont		4		15,432		335		0.1	%
Virginia		25		150,269		3,395		1.5	%
Washington		5		219,700		3,139		1.4	%
West Virginia		9		57,079		1,434		0.6	%
Wisconsin		7		187,439		1,869		0.8	%
Wyoming		4		23,558		577		0.3	%
Total		1,181		19,404,596		227,764		100.0%

(1) 47 properties are accounted for as direct financing leases and therefore for accounting purposes, revenue is recognized as direct financing lease income on the discounted cash flows of the lease payments. Amount reflected is the cash rent on these properties.

ARCT IV

State/Possession	Number of Properties		Leasable Square Feet		Annualized Rental Revenue(1)			Percentage of Rental Revenue
Alabama		28		102,760		3,513			2.4	%
Alaska		1		2,805		—	(2)		0.0	%
Arizona		11		46,246		806			0.6	%
Arkansas		29		99,978		741			0.5	%
California		10		60,528		1,480			1.0	%
Colorado		2		6,449		176			0.1	%
Connecticut		2		4,718		—	(2)		0.0	%
Florida		56		1,452,488		15,246			10.6	%
Georgia		35		153,206		4,017			2.8	%
Idaho		2		9,586		171			0.1	%
Illinois		33		155,271		3,502			2.4	%
Indiana		15		461,317		7,557			5.3	%
Iowa		5		104,910		821			0.6	%
Kansas		5		39,392		646			0.4	%
Kentucky		16		76,151		1,333			0.9	%
Louisiana		11		33,683		1,238			0.9	%
Maine		3		787,176		1,082			0.8	%
Maryland		8		25,186		1,204			0.8	%
Massachusetts		5		574,467		4,157			2.9	%
Michigan		18		115,803		1,358			0.9	%
Mississippi		5		14,260		598			0.4	%
Missouri		12		73,082		1,170			0.8	%
Nebraska		2		11,980		126			0.1	%
New Hampshire		1		7,316		145			0.1	%
New Jersey		2		4,800		193			0.1	%
New Mexico		5		23,286		205			0.1	%
New York		7		28,837		503			0.3	%
North Carolina		42		219,588		5,340			3.7	%
Ohio		29		915,662		4,634			3.2	%
Oklahoma		3		24,482		382			0.3	%
Pennsylvania		26		142,287		3,183			2.2	%
Rhode Island		6		25,454		829			0.6	%
South Carolina		7		46,847		697			0.5	%
South Dakota		3		34,773		364			0.3%

State/Possession	Number of Properties		Leasable Square Feet		Annualized Rental Revenue(1)		Percentage of Rental Revenue
Tennessee		12		47,545		1,383		1.0	%
Texas		78		445,273		8,166		5.7	%
Utah		2		7,275		245		0.2	%
Virginia		19		78,799		1,776		1.2	%
Washington		4		16,581		538		0.4	%
West Virginia		6		31,209		461		0.3	%
Wisconsin		16		47,889		1,692		1.2	%
Wyoming		3		19,502		371		0.3	%
Total		585		6,578,847		82,049		57.0%

(1) Six properties are accounted for as direct financing leases and therefore for accounting purposes, revenue is recognized as direct financing lease income on the discounted cash flows of the lease payments. Amount reflected is the cash rent on these properties.

(2) Properties under master lease agreements and for which annualized rental revenue has not been allocated to individual properties; leases which only pay rent based on a percentage of sales or other measurement per the lease agreements; and leases that are currently on a month-to-month term, where the lease may be terminated at any time, do not have an annualized rental revenue amount reflected.

CAPLEASE

State/Possession	Number of Properties		Leasable Square Feet		Annualized Rental Revenue		Percentage of Rental Revenue
Alabama		2		131,894		4,097		3.0	%
California		7		1,388,786		12,468		9.1	%
Colorado		3		420,471		7,664		5.6	%
Florida		1		307,275		2,121		1.6	%
Georgia		4		264,165		2,027		1.5	%
Illinois		2		543,750		8,635		6.3	%
Indiana		3		932,542		3,729		2.7	%
Kansas		3		266,644		4,521		3.3	%
Kentucky		6		446,274		2,874		2.1	%
Louisiana		1		133,841		2,314		1.7	%
Maryland		4		430,967		9,584		7.0	%
Massachusetts		1		88,420		758		0.6	%
Nebraska		2		426,399		5,537		4.0	%
New Jersey		2		517,215		9,056		6.6	%
New York		1		98,184		1,312		1.0	%
North Carolina		1		191,681		2,093		1.5	%
Ohio		1		111,776		984		0.7	%
Oklahoma		1		328,545		4,250		3.1	%
Pennsylvania		4		2,153,381		12,986		9.5	%
Puerto Rico		1		56,500		1,300		1.0	%
Tennessee		3		193,983		2,454		1.8	%
Texas		11		1,598,049		22,334		16.3	%
Virginia		4		658,998		8,819		6.4	%
Washington		1		155,200		2,834		2.1	%
Wisconsin		1		154,849		2,031		1.5	%
Total		70		11,999,789		136,782		100%

ARCT IV (GE Capital)

State/Possession	Number of Properties		Leasable Square Feet		Annualized Rental Revenue			Percentage of Rental Revenue
Alabama		23		83,311		3,716			6.0	%
Arizona		9		31,973		839			1.4	%
Arkansas		7		23,279		—	(1)		0.0	%
California		3		12,948		280			0.5	%
Colorado		9		39,185		—	(1)		0.0	%
Connecticut		2		5,060		193			0.3	%
District of Columbia		1		3,210		43			0.1	%
Florida		50		184,504		7,977			12.8	%
Georgia		29		133,800		2,036			3.3	%
Idaho		4		16,296		1,617			2.6	%
Illinois		20		69,021		2,531			4.1	%
Indiana		23		74,501		2,728			4.4	%
Iowa		5		18,554		576			0.9	%
Kansas		3		10,038		359			0.6	%
Kentucky		7		29,832		1,510			2.4	%
Louisiana		15		45,468		1,540			2.5	%
Maryland		1		5,867		292			0.5	%
Massachusetts		1		6,237		143			0.2	%
Michigan		24		97,962		2,388			3.9	%
Minnesota		5		19,686		308			0.5	%
Mississippi		10		28,350		1,113			1.8	%
Missouri		11		31,792		864			1.4	%
Montana		1		2,520		41			0.1	%
Nebraska		5		16,052		409			0.7	%
New Hampshire		1		6,003		112			0.2	%
New Jersey		1		3,840		115			0.2	%
New Mexico		7		23,124		1,973			3.2	%
New York		21		85,279		2,490			4.0	%
North Carolina		6		14,930		716			1.2	%
North Dakota		1		3,536		480			0.8	%
Ohio		51		171,139		4,500			7.2	%
Oklahoma		9		28,911		824			1.3	%
Oregon		6		26,807		—	(1)		0.0	%
Pennsylvania		9		37,619		931			1.5	%
South Carolina		36		89,773		2,385			3.9	%
Tennessee		29		74,906		1,951			3.2	%
Texas		63		223,103		6,501			10.4	%
Utah		1		3,300		30			0.0	%
Virginia		19		51,622		1,395			2.3	%
Washington		3		12,642		1,846			3.0	%
West Virginia		15		45,907		1,445			2.3	%
Wisconsin		32		92,849		2,638			4.3	%
Total		578		1,984,736		61,835			100%

(1) Properties under master lease agreements and for which annualized rental revenue has not been allocated to individual properties; leases which only pay rent based on a percentage of sales or other measurement per the lease agreements; and leases that are currently on a month-to-month term, where the lease may be terminated at any time, do not have an annualized rental revenue amount reflected.

COMBINED

State/Possession	Number of Properties		Leasable Square Feet		Annualized Rental Revenue(1)			Percentage of Rental Revenue
Alabama		96		896,916		19,447			3.8	%
Alaska		1		2,805		—	(2)		0.0	%
Arizona		28		152,446		3,258			0.6	%
Arkansas		54		373,875		4,393			0.9	%
California		36		2,912,590		26,716			5.3	%
Colorado		27		704,991		12,513			2.5	%
Connecticut		14		46,904		1,377			0.3	%
Delaware		4		12,369		286			0.1	%
District of Columbia		1		3,210		43			0.0	%
Florida		143		2,132,943		30,710			5.9	%
Georgia		132		954,750		16,976			3.3	%
Idaho		14		97,447		3,341			0.7	%
Illinois		97		2,254,953		33,791			6.6	%
Indiana		69		3,230,510		22,301			4.4	%
Iowa		29		794,538		6,207			1.2	%
Kansas		33		1,621,199		10,137			2.0	%
Kentucky		56		815,517		10,346			2.0	%
Louisiana		55		434,230		7,963			1.6	%
Maine		5		933,606		3,901			0.8	%
Maryland		15		473,225		11,446			2.3	%
Massachusetts		25		1,104,319		11,215			2.2	%
Michigan		120		891,474		16,420			3.2	%
Minnesota		16		220,173		2,001			0.4	%
Mississippi		51		1,423,374		10,038			2.0	%
Missouri		109		1,047,733		13,053			2.6	%
Montana		6		57,897		897			0.2	%
Nebraska		12		479,786		6,482			1.3	%
Nevada		12		100,660		2,414			0.5	%
New Hampshire		12		78,647		1,606			0.3	%
New Jersey		13		611,576		12,003			2.4	%
New Mexico		22		100,885		3,048			0.6	%
New York		54		538,761		11,827			2.3	%
North Carolina		103		1,550,147		18,990			3.7	%
North Dakota		5		34,854		1,052			0.2	%
Ohio		144		2,396,217		20,872			4.1	%
Oklahoma		35		752,123		8,339			1.6	%
Oregon		12		51,950		652			0.1	%
Pennsylvania		108		2,698,518		25,797			5.1	%
Puerto Rico		3		87,550		2,405			0.5	%
Rhode Island		11		48,942		1,465			0.3	%
South Carolina		73		785,649		10,002			2.0	%
South Dakota		5		84,414		779			0.2	%
Tennessee		92		679,213		12,315			2.4	%
Texas		279		3,249,974		52,323			10.2	%
Utah		6		24,584		690			0.1	%
Vermont		4		15,432		335			0.1%

State/Possession	Number of Properties		Leasable Square Feet		Annualized Rental Revenue(1)		Percentage of Rental Revenue
Virginia		67		939,688		15,384		3.0	%
Washington		13		404,123		8,356		1.6	%
West Virginia		30		134,195		3,340		0.7	%
Wisconsin		56		483,026		8,230		1.6	%
Wyoming		7		43,060		948		0.2	%
Total		2,414		39,967,968		508,430		100%

(1) 59 properties are accounted for as direct financing leases and, therefore, for accounting purposes, revenue is recognized as direct financing lease income on the discounted cash flows of the lease payments. Amount reflected is the cash rent on these properties.

(2) Properties under master lease agreements and for which annualized rental revenue has not been allocated to individual properties; leases which only pay rent based on a percentage of sales or other measurement per the lease agreements; and leases that are currently on a month-to-month term, where the lease may be terminated at any time, do not have an annualized rental revenue amount reflected.

Lease Expirations

The following table sets forth certain information regarding the property portfolios and the timing of the lease term expirations (excluding rights to extend a lease at the option of the tenant) on net leased, single-tenant properties (for properties under direct financing leases, average annual rent amounts represent cash rent on these properties) (dollars in thousands):

ARCP

Total Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		7		605		0.27	%		34,936
2014		34		4,358		1.92	%		200,243
2015		46		5,009		2.20	%		278,769
2016		54		6,157		2.71	%		256,987
2017		100		13,117		5.77	%		914,069
2018		121		19,626		8.63	%		1,328,382
2019		71		10,435		4.59	%		461,073
2020		58		7,377		3.24	%		300,376
2021		63		13,635		6.00	%		920,691
2022		124		24,138		10.62	%		4,073,687
2023		70		25,437		11.19	%		2,690,873
Total		748		129,894		57.13%			11,460,086

Operating Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		7		605		0.27	%		34,936
2014		33		4,286		1.93	%		197,780
2015		44		4,835		2.17	%		272,071
2016		54		6,157		2.77	%		256,987
2017		93		12,010		5.40	%		883,811
2018		112		18,825		8.47	%		1,298,505
2019		63		9,674		4.35	%		437,626
2020		58		7,377		3.32	%		300,376
2021		62		13,513		6.08	%		917,696
2022		121		23,862		10.73	%		4,061,776
2023		62		24,605		11.06	%		2,653,211
Total		709		125,749		56.55%			11,314,775

Direct Financing Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		—		—		0.00	%		—
2014		1		72		1.44	%		2,463
2015		2		174		3.48	%		6,698
2016		—		—		0.00	%		—
2017		7		1,107		22.17	%		30,258
2018		9		801		16.04	%		29,877
2019		8		761		15.24	%		23,447
2020		—		—		0.00	%		—
2021		1		122		2.44	%		2,995
2022		3		276		5.53	%		11,911
2023		8		832		16.66	%		37,662
Total		39		4,145		83.02%			145,311

ARCT IV

Total Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		16		593		0.72	%		60,643
2014		14		1,376		1.67	%		63,830
2015		41		1,180		1.43	%		128,737
2016		29		1,622		1.97	%		102,960
2017		87		10,216		12.40	%		431,693
2018		30		2,293		2.78	%		121,094
2019		17		1,603		1.95	%		65,166
2020		17		2,006		2.43	%		70,194
2021		10		573		0.70	%		39,591
2022		24		10,910		13.24	%		1,401,216
2023		23		3,195		3.88	%		209,250
Total		308		35,567		43.16%			2,694,374

Operating Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		15		486		0.60	%		57,093
2014		12		1,121		1.38	%		58,433
2015		40		1,057		1.30	%		125,529
2016		29		1,622		1.99	%		102,960
2017		87		10,216		12.56	%		431,693
2018		30		2,293		2.82	%		121,094
2019		15		1,347		1.66	%		56,834
2020		17		2,006		2.47	%		70,194
2021		10		573		0.70	%		39,591
2022		24		10,910		13.42	%		1,401,216
2023		23		3,195		3.93	%		209,250
Total		302		34,826		42.83%			2,673,887

Direct Financing Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		1		107		14.44	%		3,550
2014		2		255		34.41	%		5,397
2015		1		123		16.60	%		3,208
2016		0		—		0.00	%		—
2017		0		—		0.00	%		—
2018		0		—		0.00	%		—
2019		2		256		34.55	%		8,332
2020		0		—		0.00	%		—
2021		0		—		0.00	%		—
2022		0		—		0.00	%		—
2023		0		—		0.00	%		—
Total		6		741		100.00%			20,487

CAPLEASE

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		1		6,723		4.94	%		207,055
2014		3		2,861		2.10	%		223,912
2015		5		10,999		8.08	%		865,703
2016		10		17,527		12.88	%		1,312,058
2017		8		22,569		16.58	%		2,856,984
2018		3		4,305		3.16	%		227,672
2019		4		9,374		6.89	%		422,210
2020		8		16,952		12.46	%		1,049,555
2021		18		22,036		16.19	%		3,097,715
2022		1		3,672		2.70	%		181,160
2023		2		4,091		3.01	%		134,979
Total		63		121,109		89.00%			10,579,003

ARCT IV (GE CAPITAL)

Total Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		19		728		1.18	%		48,892
2014		35		2,573		4.16	%		117,590
2015		28		1,323		2.14	%		89,035
2016		28		2,460		3.98	%		96,548
2017		20		1,056		1.71	%		55,258
2018		27		1,598		2.58	%		83,564
2019		20		1,355		2.19	%		52,251
2020		26		2,117		3.42	%		93,779
2021		24		1,990		3.22	%		67,661
2022		12		963		1.56	%		86,617
2023		7		465		0.75	%		24,417
Total		246		16,628		26.89%			815,612

Operating Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		18		618		1.01	%		46,074
2014		33		2,382		3.90	%		111,690
2015		28		1,323		2.16	%		89,035
2016		27		2,348		3.84	%		94,239
2017		20		1,056		1.73	%		55,258
2018		26		1,400		2.29	%		78,992
2019		20		1,355		2.22	%		52,251
2020		26		2,117		3.46	%		93,779
2021		24		1,990		3.26	%		67,661
2022		12		963		1.58	%		86,617
2023		7		465		0.76	%		24,417
Total		241		16,017		26.20%			800,013

Direct Financing Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		1		110		15.74	%		2,818
2014		2		191		27.32	%		5,900
2015		0		—		0.00	%		—
2016		1		112		16.02	%		2,309
2017		0		—		0.00	%		—
2018		1		198		28.33	%		4,572
2019		0		—		0.00	%		—
2020		0		—		0.00	%		—
2021		0		—		0.00	%		—
2022		0		—		0.00	%		—
2023		0		—		0.00	%		—
Total		5		611		87.41%			15,599

COMBINED

Total Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		43		8,649		1.70	%		351,526
2014		86		11,168		2.20	%		605,575
2015		120		18,511		3.65	%		1,362,244
2016		121		27,766		5.47	%		1,768,553
2017		215		46,958		9.25	%		4,258,004
2018		181		27,822		5.48	%		1,760,712
2019		112		22,767		4.48	%		1,000,700
2020		109		28,452		5.60	%		1,513,904
2021		115		38,234		7.53	%		4,125,658
2022		161		39,683		7.82	%		5,742,680
2023		102		33,188		6.54	%		3,059,519
Total		1,365		303,198		59.72%			25,549,075

Operating Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		41		8,432		1.68	%		345,158
2014		81		10,650		2.13	%		591,815
2015		117		18,214		3.64	%		1,352,338
2016		120		27,654		5.52	%		1,766,244
2017		208		45,851		9.15	%		4,227,746
2018		171		26,823		5.35	%		1,726,263
2019		102		21,750		4.34	%		968,921
2020		109		28,452		5.68	%		1,513,904
2021		114		38,112		7.61	%		4,122,663
2022		158		39,407		7.87	%		5,730,769
2023		94		32,356		6.46	%		3,021,857
Total		1,315		297,701		59.43%			25,367,678

Direct Financing Leases:

Year of Expiration	Number of Leases Expiring		Average Annual Rent		Percentage of Average Annual Rent			Leasable Square Feet
July 1, 2013 through December 31, 2013		2		217		3.37	%		6,368
2014		5		518		8.05	%		13,760
2015		3		297		4.62	%		9,906
2016		1		112		1.74	%		2,309
2017		7		1,107		17.21	%		30,258
2018		10		999		15.53	%		34,449
2019		10		1,017		15.81	%		31,779
2020		0		—		0.00	%		—
2021		1		122		1.90	%		2,995
2022		3		276		4.29	%		11,911
2023		8		832		12.93	%		37,662
Total		50		5,497		85.45%			181,397