American Realty Capital Properties, Inc.
Quarterly Supplemental Information
Second Quarter2013
Table of Contents
| Introductory Notes | 1 |
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| Company Information | 2 |
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| Summary of Financial Highlights | 4 |
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| Selected Financial Information | 5 |
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| Consolidated Balance Sheets | 6 |
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| Consolidated Statements of Operations | 7 |
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| Funds from Operations and Adjusted Funds from Operations | 8 |
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| Pro Forma 2014E Earnings Guidance Summary | 10 |
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| Common Stock Dividend Summary | 11 |
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| Financial and Operational Statistics and Ratios | 12 |
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| Debt Summary | 13 |
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| Mortgage Notes Payable | 14 |
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| Summary of Debt Covenants | 15 |
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| Top 10 Concentrations | 16 |
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| Tenant Diversification | 17 |
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| Tenant Industry Diversification | 20 |
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| Property Geographic Diversification | 21 |
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| Property Building Type Diversification | 22 |
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| Lease Expirations | 23 |
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| Definitions | 24 |
American Realty Capital Properties, Inc.
Introductory Notes
The financial data and other information described in this Quarterly Supplement are as of the date this Quarterly Supplement was filed or an earlier date where indicated. Future performance may not be consistent with past performance, and is subject to change with inherent risks and uncertainties.
This Quarterly Supplement contains certain statements that are the Company’s (as defined below) and its management’s hopes, intentions, beliefs, expectations, or projections of the future and might be considered to be forward-looking statements under Federal securities laws. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance, and involve inherent risks and uncertainties. The Company’s actual future results may differ significantly from the matters discussed in these forward-looking statements, we do not undertake to, and may not, release revisions to these forward-looking statements to reflect changes after we have made the statements. Factors and risks that could cause actual results to differ materially from expectations are disclosed from time to time in greater detail in the Company’s filings with the Securities and Exchange Commission (“SEC”), including, but not limited to, the Company’s Annual Report on Form 10-K filed with the SEC, the Company’s quarterly reports on Form 10-Q filed with the SEC, as well as other reports and Company press releases filed with the SEC.
This Quarterly Supplement information includes certain combined consolidated financial information. We use the terms “on a combined basis” throughout this Quarterly Supplement. The consolidated financial information combines the historical financial statements of American Realty Capital Properties, Inc. (“ARCP” or the “Company”) and American Realty Capital Trust III, Inc. (“ARCT III”) after giving effect to the merger of ARCT III into a wholly-owned subsidiary of ARCP (the “ARCT III Merger”), using the carryover basis of accounting as ARCP and ARCT III were considered to be entities under common control under United States generally accepted accounting principles. The consolidated financial information should be read in conjunction with ARCP’s historical consolidated financial statements including the notes thereto, and the notes to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2012.
The combined consolidated financial information is presented for illustrative purposes only and does not purport to be indicative of the results that would actually have occurred if the ARCT III Merger had occurred as presented in such statements. In addition, future results may vary significantly from the results reflected in such statements.
Definitions of specialized terms can be found at the end of this presentation on page 24.
American Realty Capital Properties, Inc.
Company Information
Company Profile
American Realty Capital Properties, Inc. (NASDAQ:ARCP)("ARCP")is a publicly traded Maryland corporation that qualified as a real estate investment trust (“REIT”) for U.S. federal income tax purposes beginning in the taxable year ended December 31, 2011, that acquires, owns and operates primarily single-tenant, freestanding commercial real estate properties. Our high-quality property portfolio is generally net leased to corporate tenants. These tenants are primarily investment grade rated, occupying properties located at the corner of “Main & Main” and in other strategic locations. Unlike other net lease REITs, ARCP focuses on acquiring properties with both mid-term and long-term leases, which provide for both income generation and growth potential over the longer term. Our investment strategy emphasizes durable income delivered through dependable monthly dividends. ARCP completed its IPO on September 7, 2011, and on February 28, 2013, ARCP completed its merger with ARCT III, a public non-traded REIT with a similar investment strategy.
ARCP's shares trade on the NASDAQ Global Select Market under the ticker symbol "ARCP".
Company Mission
Our mission is to provide our investors with durable income and growth potential while preserving investor capital through a professionally managed investment strategy focused on investment grade corporate tenants occupying properties subject to mid-term and long-term net leases in strategic locations. We believe this approach enables us to generate attractive risk-adjusted returns for our investors. Management adheres to a strict code of industry best practices designed to put the investor first and to align the interests of our stockholders with those of management. These practices include lower fees, fulsome disclosures, a best of class management team, properly sized equity raises, pay for performance, prudent use of leverage and coverage of distributions.
Investment Strategy
Our investment strategy is designed to generate monthly dividends from a durable and predictable level of monthly rents paid by primarily investment grade rated and other credit-worthy tenants, and to provide significant growth potential. We place a premium on stability of cash flow for our investors, and therefore sustain a portfolio blend of both mid-term and long-term lease durations. Our continued focus will be on expanding and diversifying our portfolio of high-quality, well located net leased properties by tenant, industry and geography. We intend to pursue an investment strategy that maximizes current cash flow and achieves sustainable long-term growth, thereby enhancing total return for our investors.
American Realty Capital Properties, Inc.
Company Information
(Continued)
| Senior Management | Board of Directors |
| Nicholas S. Schorsch, Chief Executive Officer | Nicholas S. Schorsch, Chairman |
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| Edward M. Weil, Jr., President, Secretary and Treasurer | Edward M. Weil, Jr., Director |
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| Peter M. Budko, Executive Vice President and Chief Investment Officer | William M. Kahane, Director |
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| Brian S. Block, Executive Vice President and Chief Financial Officer | Leslie D. Michelson, Lead Independent Director |
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| Brian D. Jones, Executive Vice President and Chief Operating Officer | Governor Edward G. Rendell, Independent Director |
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| | Walter P. Lomax, Jr., M.D., Independent Director |
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| | Scott J. Bowman, Independent Director |
Corporate Offices and Contact Information
405 Park Avenue, 15th Floor
New York, NY 10022
212-415-6500
www.arcpreit.com
Trading Symbol: ARCP
Stock Exchange Listing: NASDAQ Global Select Market
Transfer Agent
Computershare Trust Company, N.A.
250 Royall Street
Canton, MA 02021
800-736-3001
Covering Analysts
| | JMP Securities | Ladenburg Thalmann |
| | Mitch Germain | Dan Donlan |
| 212-906-3546 | 212-409-2056 |
| mgermain@jmpsecurities.com | ddonlan@ladenburg.com |
American Realty Capital Properties, Inc.
Summary of Financial Highlights
Second Quarter2013 Operating Highlights (three months ended June 30, 2013)
| • | Revenues:$45.0 million. Annualized revenues as ofJune 30, 2013 are$227.8 million. |
| • | Net operating income (excluding one-time merger and acquisition related costs and non-cash depreciation and amortization expenses):$37.9 million. |
| • | Core funds from operations:$28.8 million, or$0.17 per share (excluding one-time acquisition related costs). |
| • | Adjusted funds from operations:$32.8 million, or$0.19 per share. |
| • | Normalized AFFO per share: $0.23 per share (run rate to normalize timing of second quarter events). |
| • | Total dividends paid to common stockholders:$37.1 million, or$0.904 per share on an annualized basis ($0.910 per share on an annualized basis atJune 30, 2013). |
| • | Dividend increase: Declared on May 28, 2013, an increase in annual dividend rate from $0.910 per share to $0.940 per share, contingent upon and effective with the earlier of the close of the ARCT IV merger and the CapLease merger (each described below). |
| • | Fully diluted weighted-average shares outstanding:171.0 million. |
Property Portfolio Highlights
| • | Portfolio composition:1,181 properties, 100% occupied (excluding one vacant property classified as held-for-sale), freestanding single-tenant properties comprised of19.4 million square feet, occupied by69.3% investment grade corporate tenants (attributing the rating of each parent company to its wholly owned subsidiary, as applicable) with a weighted average remaining lease term of 10 years. |
| • | 2Q asset acquisitions: $878.3 million of properties acquired at an average capitalization rate of 7.6% (including expected contingent rental income). |
| • | Acquisitions subsequent to quarter end: 26 properties acquired for $25.3 million since July 1, 2013, at an average capitalization rate of 8.6%. |
| • | 2H 2013 acquisition targets and pipeline:Target acquisitions for the balance of 2013 increased to $1.1 billion at an average capitalization rate of 8.0%, including approximately 150 properties with an aggregate purchase price of approximately $690 million under definitive purchase agreement. |
Other Activity
| • | CapLease merger:Announced on May 28, 2013 $2.2 billion acquisition of CapLease Inc. ("CapLease"), which is expected to close mid-September, with the CapLease special stockholder meeting scheduled for September 10, 2013. |
| • | ARCT IV merger: Announced on July 2, 2013 $3.1 billion acquisition of American Realty Capital Trust IV, Inc. ("ARCT IV"), expected to close mid- to late-September (respective special shareholder meetings have not yet been scheduled). |
| • | Equity offerings:Closed $900 million common and preferred stock private placements. |
| • | Debt offering:$310 million underwritten 3.00% convertible notes offering (closed July 29, 2013), including $10 million over-allotment option exercised (closed August 1, 2013). |
| • | Senior corporate credit facility:Upsized senior corporate credit facility by $250 million as of August 1, 2013, providing total financing capacity of up to $1.7 billion with additional “accordion” capacity, subject to certain conditions, of up to $2.5 billion. |
| • | Credit facility capacity: Credit facility balance as of June 30, 2013 consisted of $600 million term loan, providing $1.1 billion of capacity including new commitments. |
American Realty Capital Properties, Inc.
Selected Financial Information
(in 000’s, except share and per share data)
| | | Quarter Ended |
| | | June 30, 2013 | | March 31, 2013 | | December 31, 2012 | | September 30, 2012 | | June 30, 2012 |
| Total revenues | | $ | 44,960 | | | $ | 40,071 | | | $ | 29,946 | | | $ | 18,816 | | | $ | 11,430 | |
| Net loss attributable to stockholders | | (51,679 | ) | | (137,920 | ) | | (14,610 | ) | | (12,691 | ) | | (7,070 | ) |
| Basic and diluted net loss per share from continuing operations attributable to common stockholders | | (0.32 | ) | | (0.90 | ) | | (0.08 | ) | | (0.09 | ) | | (0.10 | ) |
| Basic and diluted net loss per share attributable to common stockholders | | (0.32 | ) | | (0.90 | ) | | (0.08 | ) | | (0.09 | ) | | (0.10 | ) |
| | | | | | | | | | | |
| Funds from operations (FFO) | | 13,611 | | | 24,407 | | | 6,431 | | | (1,012 | ) | | 26 | |
| Core FFO | | 28,755 | | | 29,989 | | | 21,827 | | | 13,624 | | | 7,840 | |
| Adjusted funds from operations (AFFO) | | 32,833 | | | 30,666 | | | 21,447 | | | 13,854 | | | 8,041 | |
| | | | | | | | | | | |
| General and administrative expenses | | 1,125 | | | 1,307 | | | 2,386 | | | 504 | | | 497 | |
| Interest expense | | (11,238 | ) | | (6,202 | ) | | (4,351 | ) | | (3,454 | ) | | (2,686 | ) |
| Straight-line revenue adjustment | | (1,605 | ) | | (1,370 | ) | | (1,013 | ) | | (599 | ) | | (362 | ) |
| | | | | | | | | | | |
| Dividends paid on common stock | | 37,088 | | | 32,304 | | | 31,078 | | | 20,082 | | | 8,962 | |
| | | Quarter Ended |
| | | June 30, 2013 | | March 31, 2013 | | December 31, 2012 | | September 30, 2012 | | June 30, 2012 |
| Total real estate investments, at cost, including net investments in direct financing leases | | $ | 2,933,838 | | | $ | 2,061,286 | | | $ | 1,798,490 | | | $ | 1,181,061 | | | $ | 727,702 | |
| Total assets | | 2,916,785 | | | 2,088,102 | | | 1,965,452 | | | 1,879,966 | | | 1,125,809 | |
| Total debt, excluding premiums and discounts | | 1,314,918 | | | 905,118 | | | 389,722 | | | 283,580 | | | 249,613 | |
| Total equity | | 1,552,212 | | | 1,166,021 | | | 1,548,159 | | | 1,575,773 | | | 863,190 | |
American Realty Capital Properties, Inc.
Consolidated Balance Sheets
(in 000’s)
| | | June 30, 2013 | | March 31, 2013 | | December 31, 2012 | | September 30, 2012 | | June 30, 2012 |
| ASSETS | | | | | | | | | | |
| Real estate investments, at cost: | | | | | | | | | | |
| Land | | $ | 504,562 | | | $ | 298,280 | | | $ | 249,541 | | | $ | 172,063 | | | $ | 109,892 | |
| Buildings, fixtures and improvements | | 2,043,270 | | | 1,521,505 | | | 1,336,726 | | | 869,424 | | | 534,858 | |
| Acquired intangible lease assets | | 318,488 | | | 241,501 | | | 212,223 | | | 139,574 | | | 82,952 | |
| Total real estate investments, at cost | | 2,866,320 | | | 2,061,286 | | | 1,798,490 | | | 1,181,061 | | | 727,702 | |
| Less: accumulated depreciation and amortization | | (108,765 | ) | | (81,207 | ) | | (56,110 | ) | | (37,666 | ) | | (25,903 | ) |
| Total real estate investments, net | | 2,757,555 | | | 1,980,079 | | | 1,742,380 | | | 1,143,395 | | | 701,799 | |
| Cash and cash equivalents | | 10,958 | | | 52,412 | | | 156,873 | | | 695,453 | | | 393,848 | |
| Investment in direct financing leases, net | | 67,518 | | | — | | | — | | | — | | | — | |
| Other investments, at fair value | | 9,920 | | | 4 | | | 41,654 | | | 8,089 | | | — | |
| Derivatives, at fair value | | 10,161 | | | — | | | — | | | — | | | — | |
| Restricted cash | | 1,576 | | | 1,287 | | | 1,108 | | | 1,212 | | | 1,547 | |
| Prepaid expenses and other assets | | 14,626 | | | 15,397 | | | 7,416 | | | 10,837 | | | 16,873 | |
| Receivable for issuance of common stock | | — | | | — | | | — | | | 4,320 | | | — | |
| Deferred costs, net | | 38,443 | | | 38,244 | | | 15,356 | | | 15,848 | | | 10,330 | |
| Assets held for sale | | 6,028 | | | 679 | | | 665 | | | 812 | | | 1,412 | |
| Total assets | | $ | 2,916,785 | | | $ | 2,088,102 | | | $ | 1,965,452 | | | $ | 1,879,966 | | | $ | 1,125,809 | |
| | | | | | | | | | | |
| LIABILITIES AND EQUITY | | | | | | | | | | |
| Mortgage notes payable | | $ | 269,918 | | | $ | 265,118 | | | $ | 265,118 | | | $ | 192,490 | | | $ | 174,720 | |
| Senior secured revolving credit facility | | — | | | — | | | 124,604 | | | 91,090 | | | 74,893 | |
| Senior corporate credit facility | | 600,000 | | | 640,000 | | | — | | | — | | | — | |
| Convertible obligation to Series C Convertible Preferred stockholders | | 445,000 | | | — | | | — | | | — | | | — | |
| Contingent value rights obligation to preferred and common investors, at fair value | | 31,134 | | | — | | | — | | | — | | | — | |
| Derivatives, at fair value | | 1,186 | | | 5,012 | | | 3,830 | | | 4,122 | | | 2,924 | |
| Accounts payable and accrued expenses | | 12,060 | | | 6,589 | | | 9,459 | | | 4,439 | | | 3,861 | |
| Deferred rent and other liabilities | | 5,274 | | | 5,270 | | | 4,336 | | | 2,801 | | | 1,701 | |
| Distributions payable | | 1 | | | 92 | | | 9,946 | | | 9,251 | | | 4,520 | |
| Total liabilities | | 1,364,573 | | | 922,081 | | | 417,293 | | | 304,193 | | | 262,619 | |
| | | | | | | | | | | |
| Convertible preferred stock, $0.01 par value, 100,000,000 shares authorized, 828,472 shares issued and outstanding at June 30, 2013 and December 31, 2012, respectively | | 8 | | | 8 | | | 8 | | | 8 | | | 5 | |
| Common stock, $0.01 par value, 240,000,000 shares authorized, 184,893,886 and 179,167,112 issued and outstanding at June 30, 2013 and December 31, 2012, respectively | | 1,846 | | | 1,543 | | | 1,792 | | | 1,777 | | | 978 | |
| Additional paid-in capital | | 1,801,460 | | | 1,335,863 | | | 1,653,900 | | | 1,639,179 | | | 891,306 | |
| Accumulated other comprehensive income (loss) | | 8,919 | | | (5,018 | ) | | (3,934 | ) | | (4,101 | ) | | (2,937 | ) |
| Accumulated deficit | | (379,502 | ) | | (290,484 | ) | | (120,072 | ) | | (73,603 | ) | | (35,937 | ) |
| Total stockholders’ equity | | 1,432,731 | | | 1,041,912 | | | 1,531,694 | | | 1,563,260 | | | 853,415 | |
| Non-controlling interests | | 119,481 | | | 124,109 | | | 16,465 | | | 12,513 | | | 9,775 | |
| Total equity | | 1,552,212 | | | 1,166,021 | | | 1,548,159 | | | 1,575,773 | | | 863,190 | |
| Total liabilities and equity | | $ | 2,916,785 | | | $ | 2,088,102 | | | $ | 1,965,452 | | | $ | 1,879,966 | | | $ | 1,125,809 | |
American Realty Capital Properties, Inc.
Consolidated Statements of Operations(1)
(in 000’s, except per share data)
| | | | | | | | | | | |
| | | Quarter Ended |
| | June 30, 2013 | | March 31, 2013 | | December 31, 2012 | | September 30, 2012 | | June 30,
2012 |
| Revenues: | | | | | | | | | | | | | | | | | | | | |
| Rental income | | $ | 43,130 | | | $ | 38,249 | | | $ | 28,717 | | | $ | 18,301 | | | $ | 11,329 | |
| Operating expense reimbursements | | 1,830 | | | 1,822 | | | 1,229 | | | 515 | | | 101 | |
| Total revenues | | 44,960 | | | 40,071 | | | 29,946 | | | 18,816 | | | 11,430 | |
| Operating expenses: | | | | | | | | | | |
| Acquisition related | | 15,144 | | | 5,582 | | | 15,396 | | | 14,636 | | | 7,814 | |
| Merger and other transaction related | | 4,680 | | | 137,769 | | | 2,583 | | | — | | | 20 | |
| Property operating | | 2,465 | | | 2,388 | | | 1,827 | | | 1,077 | | | 288 | |
| General and administrative | | 1,125 | | | 1,307 | | | 2,386 | | | 504 | | | 497 | |
| Equity-based compensation | | 3,454 | | | 876 | | | 378 | | | 473 | | | 183 | |
| Depreciation and amortization | | 27,806 | | | 25,023 | | | 18,310 | | | 11,632 | | | 6,994 | |
| Operating fees to affiliates | | — | | | — | | | — | | | — | | | — | |
| Total operating expenses | | 54,674 | | | 172,945 | | | 40,880 | | | 28,322 | | | 15,796 | |
| Operating loss | | (9,714 | ) | | (132,874 | ) | | (10,934 | ) | | (9,506 | ) | | (4,366 | ) |
| Other income (expenses): | | | | | | | | | | |
| Interest expense | | (11,238 | ) | | (6,202 | ) | | (4,351 | ) | | (3,454 | ) | | (2,686 | ) |
| Loss on contingent value rights | | (31,134 | ) | | — | | | — | | | — | | | — | |
| Income from investment securities | | — | | | 218 | | | — | | | — | | | — | |
| Gain on sale of investment securities | | — | | | 451 | | | — | | | — | | | — | |
| Gain (loss) on derivative instruments | | (40 | ) | | (5 | ) | | 90 | | | — | | | — | |
| Other income | | 91 | | | 35 | | | 687 | | | 206 | | | 62 | |
| Total other expenses, net | | (42,321 | ) | | (5,503 | ) | | (3,574 | ) | | (3,248 | ) | | (2,624 | ) |
| Loss from continuing operations | | (52,035 | ) | | (138,377 | ) | | (14,508 | ) | | (12,754 | ) | | (6,990 | ) |
| Net loss from continuing operations attributable to non-controlling interests | | 322 | | | 433 | | | 117 | | | 65 | | | 72 | |
| Net loss from continuing operations attributable to stockholders | | (51,713 | ) | | (137,944 | ) | | (14,391 | ) | | (12,689 | ) | | (6,918 | ) |
| Discontinued operations: | | | | | | | | | | |
| Net income (loss) from operations of held for sale properties | | 36 | | | 11 | | | (90 | ) | | 45 | | | (84 | ) |
| Gain (loss) on held for sale properties | | — | | | 14 | | | (148 | ) | | (47 | ) | | (82 | ) |
| Net gain (loss) from discontinued operations | | 36 | | | 25 | | | (238 | ) | | (2 | ) | | (166 | ) |
| Net (gain) loss from discontinued operations attributable to non-controlling interests | | (2 | ) | | (1 | ) | | 19 | | | — | | | 14 | |
| Net gain (loss) from discontinued operations attributable to stockholders | | 34 | | | 24 | | | (219 | ) | | (2 | ) | | (152 | ) |
| Net loss | | (51,999 | ) | | (138,352 | ) | | (14,746 | ) | | (12,756 | ) | | (7,156 | ) |
| Net loss attributable to non-controlling interests | | 320 | | | 432 | | | 136 | | | 65 | | | 86 | |
| Net loss attributable to stockholders | | $ | (51,679 | ) | | $ | (137,920 | ) | | $ | (14,610 | ) | | $ | (12,691 | ) | | $ | (7,070 | ) |
| Basic and diluted net loss per share from continuing operations attributable to common stockholders | | $ | (0.32 | ) | | $ | (0.90 | ) | | $ | (0.08 | ) | | $ | (0.09 | ) | | $ | (0.10 | ) |
| Basic and diluted net loss per share attributable to common stockholders | | $ | (0.32 | ) | | $ | (0.90 | ) | | $ | (0.08 | ) | | $ | (0.09 | ) | | $ | (0.10 | ) |
_______________________________________________
(1) Certain historical balances have been restated for discontinued operations.
American Realty Capital Properties, Inc.
Funds from Operations and Adjusted Funds from Operations
(in 000’s, except share and per share data)
| | | Quarter Ended | | Quarter Ended |
| | | June 30, 2013 | | Per Share | | March 31, 2013 | | Per Share |
| Net loss attributable to stockholders (in accordance with U.S. GAAP) | | $ | (51,679 | ) | | $ | (0.30 | ) | | $ | (137,920 | ) | | $ | (0.89 | ) |
| Merger and other transaction costs | | 4,680 | | | 0.03 | | | 137,769 | | | 0.89 | |
| Loss on contingent valuation rights | | 31,134 | | | 0.18 | | | — | | | — | |
| (Gain) loss on held for sale properties | | — | | | — | | | (14 | ) | | — | |
| Gain on sale of investment securities | | — | | | — | | | (451 | ) | | — | |
| Loss on derivative instruments | | 40 | | | — | | | — | | | — | |
| Interest on convertible obligation to preferred investors | | 1,630 | | | 0.01 | | | — | | | — | |
| Depreciation and amortization | | 27,806 | | | 0.16 | | | 25,023 | | | 0.16 | |
| FFO | | 13,611 | | | 0.08 | | | 24,407 | | | 0.16 | |
| | | | | | | | | |
| Acquisition and transaction related costs | | 15,144 | | | 0.09 | | | 5,582 | | | 0.04 | |
| Core FFO | | 28,755 | | | 0.17 | | | 29,989 | | | 0.19 | |
| | | | | | | | | |
| Amortization of above-market lease | | 63 | | | — | | | 63 | | | — | |
| Amortization of deferred financing costs | | 2,166 | | | 0.01 | | | 1,108 | | | 0.01 | |
| Straight-line rent | | (1,605 | ) | | (0.01 | ) | | (1,370 | ) | | (0.01 | ) |
| Non-cash equity compensation expense | | 3,454 | | | 0.02 | | | 876 | | | 0.01 | |
| AFFO | | $ | 32,833 | | | $ | 0.19 | | | $ | 30,666 | | | $ | 0.21 | |
| | | | | | | | | |
| Weighted average shares - fully diluted(1) | | 171,012 | | | | | 154,322 | | | |
_______________________________________________
(1) Weighted average shares for the three months ended March 31, 2013 are adjusted on a pro forma basis as if 27.7 million shares that were repurchased in conjunction with the ARCT III merger were repurchased as of the beginning of the period. Amounts exclude operating partnership units as operating results are adjusted for the corresponding impact of non-controlling interests.
American Realty Capital Properties, Inc.
Funds from Operations and Adjusted Funds from Operations
(in 000’s except share and per share data)
| | | Quarter Ended |
| | | June 30, 2013 | | March 31, 2013 | | December 31, 2012 | | September 30, 2012 | | June 30, 2012 |
| Net loss attributable to stockholders (in accordance with U.S. GAAP) | | $ | (51,679 | ) | | $ | (137,920 | ) | | $ | (14,610 | ) | | $ | (12,691 | ) | | $ | (7,070 | ) |
| Merger and other transaction costs | | 4,680 | | | 137,769 | | | 2,583 | | | — | | | 20 | |
| Loss on contingent valuation rights | | 31,134 | | | — | | | — | | | — | | | — | |
| (Gain) loss on held for sale properties | | — | | | (14 | ) | | 148 | | | 47 | | | 82 | |
| Gain on sale of investment securities | | — | | | (451 | ) | | — | | | — | | | — | |
| Loss on derivative instruments | | 40 | | | — | | | — | | | — | | | — | |
| Interest on convertible obligation to preferred investors | | 1,630 | | | — | | | | | | | — | |
| Depreciation and amortization | | 27,806 | | | 25,109 | | | 18,310 | | | 11,632 | | | 6,994 | |
| FFO | | 13,611 | | | 24,493 | | | 6,431 | | | (1,012 | ) | | 26 | |
| | | | | | | | | | | |
| Acquisition and transaction related costs | | 15,144 | | | 5,582 | | | 15,396 | | | 14,636 | | | 7,814 | |
| Core FFO | | 28,755 | | | 30,075 | | | 21,827 | | | 13,624 | | | 7,840 | |
| | | | | | | | | | | |
| Amortization of above-market lease | | 63 | | | 63 | | | 61 | | | 56 | | | — | |
| Amortization of deferred financing costs | | 2,166 | | | 1,108 | | | 276 | | | 201 | | | 385 | |
| Straight-line rent | | (1,605 | ) | | (1,370 | ) | | (1,013 | ) | | (599 | ) | | (362 | ) |
| Non-cash equity compensation expense | | 3,454 | | | 876 | | | 387 | | | 481 | | | 178 | |
| Mark to market adjustment | | — | | | — | | | (91 | ) | | 91 | | | — | |
| AFFO | | $ | 32,833 | | | $ | 30,752 | | | $ | 21,447 | | | $ | 13,854 | | | $ | 8,041 | |
| | | | | | | | | | | |
| Common stock distributions paid (cash and shares) | | $ | 37,088 | | | $ | 32,304 | | | $ | 31,078 | | | $ | 20,082 | | | $ | 8,962 | |
| Common stock distributions paid in cash | | $ | 37,088 | | | $ | 27,409 | | | $ | 16,906 | | | $ | 11,726 | | | $ | 5,627 | |
American Realty Capital Properties, Inc.
Pro Forma 2014E Earnings Guidance Summary
| | | 2014E Revised Guidance |
| (dollar amounts in millions, except per share data) | | Low | | High |
| FFO/share (fully diluted) | | $ | 1.15 | | | $ | 1.18 | |
| AFFO/share (fully diluted) | | $ | 1.14 | | | $ | 1.18 | |
Second-Half 2013 Key Assumptions:
| • | Acquisitions: Acquire $1.1 billion of assets at 8.0% average cap rate (balance of 2013) |
| • | ARCT IV Cash Election: $160 million (7.5% of total consideration) |
| • | Senior Unsecured Debt: $1.4 billion aggregate 5-, 7- and 10-year senior unsecured notes at 4.10% weighted average interest rate |
| • | CapLease Mortgages: Assume additional $502 million mortgage debt at high end; reduce defeasance cost by $40 million |
| • | Equity Raise: No equity raise for high end guidance |
| • | Equity Raise: $525.8 million equity raise for low end guidance |
| • | Shares Outstanding at Year End: 388.6 million at low end, 356.7 million at high end (fully diluted) |
2014 Key Assumptions:
| • | Acquisitions: Acquire $1.0 billion of assets at 8.25% average cap rate |
| • | Capitalization: 65% equity issuance, 35% debt utilization |
| • | Wtd. Ave. Shares Outstanding: 407.9 million at low end, 376.0 million at high end (fully diluted) |
American Realty Capital Properties, Inc.
Common Stock Dividend Summary
(in 000’s, except per share data)
| | | Dividends Paid | | |
| Month | | Cash | | DRIP | | Total Common Stock Dividends | | Dividends per share (annualized) (1) |
| Jun-13 | | $ | 13,952 | | | $ | — | | | $ | 13,952 | | | $ | 0.910 | |
| May-13 | | 11,580 | | | — | | | 11,580 | | | 0.900 | |
| Apr-13 | | 11,556 | | | — | | | 11,556 | | | 0.900 | |
| Q2 2013 | | 37,088 | | | — | | | 37,088 | | | |
| Mar-13 | | 11,575 | | | — | | | 11,575 | | | 0.900 | |
| Feb-13 | | 9,950 | | | — | | | 9,950 | | | 0.895 | |
| Jan-13 | | 5,884 | | | 4,895 | | | 10,779 | | | 0.895 | |
| Q1 2013 | | 27,409 | | | 4,895 | | | 32,304 | | | |
| 2013 to date | | $ | 64,497 | | | $ | 4,895 | | | $ | 69,392 | | | |
| | | | | | | | | |
| Dec-12 | | $ | 5,641 | | | $ | 4,731 | | | $ | 10,372 | | | |
| Nov-12 | | 5,784 | | | 4,864 | | | 10,648 | | | 0.895 | |
| Oct-12 | | 5,481 | | | 4,577 | | | 10,058 | | | 0.890 | |
| Q4 2012 | | 16,906 | | | 14,172 | | | 31,078 | | | 0.890 | |
| Sept-12 | | 4,626 | | | 3,599 | | | 8,225 | | | |
| Aug-12 | | 3,860 | | | 2,678 | | | 6,538 | | | 0.890 | |
| Jul-12 | | 3,240 | | | 2,079 | | | 5,319 | | | 0.885 | |
| Q3 2012 | | 11,726 | | | 8,356 | | | 20,082 | | | 0.885 | |
| Jun-12 | | 2,541 | | | 1,688 | | | 4,229 | | | |
| May-12 | | 1,820 | | | 1,019 | | | 2,839 | | | 0.885 | |
| Apr-12 | | 1,266 | | | 628 | | | 1,894 | | | 0.880 | |
| Q2 2012 | | 5,627 | | | 3,335 | | | 8,962 | | | 0.880 | |
| Mar-12 | | 536 | | | 380 | | | 916 | | | |
| Feb-12 | | 1,321 | | | 302 | | | 1,623 | | | 0.880 | |
| Jan-12 | | 793 | | | 231 | | | 1,024 | | | 0.875 | |
| Q1 2012 | | 2,650 | | | 913 | | | 3,563 | | | 0.875 | |
| Total 2012 | | $ | 36,909 | | | $ | 26,776 | | | $ | 63,685 | | | |
| | | | | | | | | |
| Dec-11 | | $ | 696 | | | $ | 162 | | | $ | 858 | | | |
| Nov-11 | | 630 | | | 101 | | | 731 | | | 0.875 | |
| Oct-11 | | 415 | | | 9 | | | 424 | | | 0.875 | |
| Q4 2011 | | 1,741 | | | 272 | | | 2,013 | | | 0.875 | |
| Sept-11 | | — | | | — | | | — | | | |
| Q3 2011 | | — | | | — | | | — | | | |
| Total 2011 | | $ | 1,741 | | | $ | 272 | | | $ | 2,013 | | | |
_______________________________________________
(1) Excludes distributions paid to ARCT III stockholders prior to its merger with ARCP.
American Realty Capital Properties, Inc.
Financial and Operational Statistics and Ratios
| Financial and Operational Statistics and Ratios | | As of June 30, 2013 and
for the Quarter then
Ended |
| Debt to total capitalization(1) | | 21.6 | % |
| Net debt to total capitalization(1) | | 21.4 | % |
| Net debt to enterprise value(1) | | 20.8 | % |
| Annualized Adjusted EBITDA(2) | | 153,292 | |
| Net debt to annualized EBITDA(1) | | 2.9 | |
| Annualized EBITDA/annualized interest expense(1) | | 4.2 | |
| Annualized EBITDA/annualized fixed charges(1) | | 4.2 | |
| Total debt/gross assets(1) | | 29.8 | % |
| Common shares outstanding | | 184,550,186 | |
| Fully diluted shares outstanding, excluding operating partnership units | | 214,115,012 | |
| Operating partnership units outstanding(3) | | 9,051,660 | |
| Stock price at end of period | | $ | 15.26 | |
| Market capitalization (equity capitalization) (in 000's) | | $ | 2,816,236 | |
| Total capitalization (in 000's) | | $ | 4,162,288 | |
| Enterprise value (in 000's) | | $ | 4,270,819 | |
| High stock close price | | $ | 17.82 | |
| Low stock close price | | $ | 14.23 | |
_______________________________________________
(1) Debt and interest expense statistics exclude balances related to Convertible obligation to Series C Convertible Preferred stockholders as this amount is convertible to common shares at ARCP's option.
(2)Amount excludes one-time for acquisition, merger and other transaction costs as well as unrealized losses on contingent value rights.
(3)Excludes 8.2 million long-term incentive plan units which are unearned at June 30, 2013.
American Realty Capital Properties, Inc.
Debt Summary
(in 000’s)
| Debt Maturities: | | Total | | July 1, 2013 -
December 31, 2013 | | 2014 – 2015 | | 2016 – 2017 | | Thereafter |
| Mortgage notes payable | | $ | 269,918 | | | $ | 74 | | | $ | 13,956 | | | $ | 186,588 | | | $ | 69,300 | |
| Senior corporate credit facility | | 600,000 | | | — | | | — | | | — | | | 600,000 | |
| Convertible obligation to Series C Convertible Preferred stockholders | | 445,000 | | | $ | 455,000 | | | — | | | — | | | — | |
| Total | | $ | 1,314,918 | | | $ | 455,074 | | | $ | 13,956 | | | $ | 186,588 | | | $ | 669,300 | |
| Debt Summary | | Percentage of Total Debt | | Weighted Average Effective Interest Rate | | Weighted Average Maturity (years) |
| Mortgage notes payable | | 20.5 | % | | 4.25 | % | | 4.99 | |
| Unsecured credit facility | | 45.6 | % | | 2.69 | % | | 5.7 | |
| Convertible obligation to Series C Convertible Preferred stockholders | | 33.9 | % | | 5.81 | % | | 0.5 | |
Excludes $310.0 million of convertible debt issued in July 2013 and August 2013, which matures in August 2018. The notes bear an annualized interest rate of 3.00%.
American Realty Capital Properties, Inc.
Mortgage Notes Payable
| Lender | | Maturity | | Balance (000's) | | Coupon Rate | | Effective Rate | | Payment Terms(1) |
| Citigroup | | 2/6/2022 | | $ | 39,200 | | | 6.05 | % | | 6.13 | % | | IO |
| Wells Fargo | | 2/28/2017 | | 36,600 | | | 3.76 | % | | 3.81 | % | | IO |
| Bank of Texas | | 7/31/2017 | | 28,350 | | | 3.28 | % | | 3.32 | % | | IO |
| Wells Fargo | | 1/31/2017 | | 24,406 | | | 3.75 | % | | 3.80 | % | | IO |
| Wells Fargo | | 1/31/2017 | | 24,094 | | | 3.75 | % | | 3.80 | % | | IO |
| Bank of Texas | | 7/31/2017 | | 16,555 | | | 3.28 | % | | 3.32 | % | | IO |
| Citi Group | | 2/6/2022 | | 15,100 | | | 6.05 | % | | 6.13 | % | | IO |
| Oritani | | 1/1/2023 | | 15,000 | | | 3.75 | % | | 3.80 | % | | IO |
| Ladder Capital | | 7/6/2015 | | 13,850 | | | 5.25 | % | | 5.32 | % | | IO through 7/2013, then P&I |
| Bank of Texas | | 7/13/2017 | | 12,725 | | | 3.43 | % | | 3.48 | % | | IO |
| Goldman Sachs | | 8/6/2017 | | 12,270 | | | 3.70 | % | | 3.75 | % | | IO |
| Customers Bank | | 12/28/2016 | | 11,940 | | | 3.75 | % | | 3.80 | % | | IO through 12/2014, then P&I |
| Customers Bank | | 8/16/2017 | | 5,500 | | | 3.63 | % | | 3.68 | % | | IO |
| Bank of Texas | | 10/31/2016 | | 5,060 | | | 3.67 | % | | 3.72 | % | | IO |
| Wells Fargo | | 3/1/2017 | | 4,800 | | | 2.69 | % | | 2.73 | % | | IO |
| First Place Bank | | 1/1/2017 | | 4,468 | | | 4.89 | % | | 4.96 | % | | IO |
| Total | | | | $ | 269,918 | | | 4.19 | % | | 4.25 | % | | |
_______________________________________________
| (1) | IO means only interest is due monthly with the principal due at maturity; P&I means both principal and interest are due monthly. |
American Realty Capital Properties, Inc.
Summary of Debt Covenants
The following is a summary of key financial covenants for the Company's senior corporate credit facility as defined and calculated per the terms of the facilities credit agreement. These calculations, which are not based on U.S. generally accepted accounting principles measurements, are presented to investors to show our ability to incur additional debt only and are not measures of our liquidity or performance.
| Key Covenants | | Required | | Q2 2013(1) | | Q1 2013 |
| Maximum consolidated leverage ratio | | ≤ 60% | | 52.44% | | 44.82% |
| Maximum recourse indebtedness | | ≤ Total Asset Value x 10% | | Limit = $310 MM/Actual = $0 | | Limit = $202 MM/Actual = $0 |
| Minimum fixed charge coverage ratio | | > 1.5x | | 2.52x | | 7.29x |
| Minimum borrowing base interest coverage ratio | | ≥ 1.65x | | 1.68x | | 8.88x |
| Secured leverage ratio | | ≤ 40% | | 8.71% | | 13.13% |
| Borrowing base asset value ratio | | ≥ 1.67x | | 1.90x | | 2.25x |
| Minimum tangible net worth ("TNW") covenant | | ≥ base TNW plus 85% of equity issuances | | Limit ≥ $1.3 B/Actual = $1.5 B | | Limit ≥ $1.0 B/Actual =$1.2 B |
| Variable rate indebtedness | | ≤Total Asset Value x 20% | | Limit = $620 MM/Actual = $0.09 MM | | Limit = $404 MM/ Actual = $125 MM |
_______________________________________________
(1) Q2 covenant calculations include the effect of $310.0 million of convertible notes issued in July 2013.
American Realty Capital Properties, Inc.
Top 10 Concentrations
Tenant Concentration
| Tenant | | Number of Properties | | Square Feet | | Square Feet as a % of Total Portfolio | | Average Annual Rent (in 000's) | | Average Annual Rent as a % of Total Portfolio | | Investment Rating |
| Dollar General | | 227 | | | 2,093,589 | | | 10.8 | % | | $ | 18,311 | | | 8.0 | % | | BBB- |
| Citizens Bank | | 156 | | | 698,366 | | | 3.6 | % | | 17,430 | | | 7.7 | % | | A- |
| FedEx | | 29 | | | 1,385,568 | | | 7.1 | % | | 16,028 | | | 7.0 | % | | BBB |
| Walgreens | | 37 | | | 530,595 | | | 2.7 | % | | 13,258 | | | 5.8 | % | | BBB |
| AON Corporation | | 1 | | | 818,686 | | | 4.2 | % | | 10,822 | | | 4.8 | % | | BBB+ |
| General Mills | | 2 | | | 1,872,112 | | | 9.6 | % | | 6,670 | | | 2.9 | % | | BBB+ |
| DineEquity Inc. | | 38 | | | 183,400 | | | 0.9 | % | | 5,397 | | | 2.4 | % | | B |
| Advance Auto | | 54 | | | 380,171 | | | 2.0 | % | | 5,259 | | | 2.3 | % | | BBB- |
| Jack In The Box, Inc. | | 45 | | | 120,417 | | | 0.6 | % | | 5,202 | | | 2.3 | % | | NR |
| Family Dollar | | 49 | | | 411,922 | | | 2.1 | % | | 4,762 | | | 2.1 | % | | BBB- |
| Total | | 638 | | | 8,494,826 | | | 43.6 | % | | $ | 103,139 | | | 45.3 | % | | 89.7% |
Industrial Concentration
| Industry | | Number of Properties | | Square Feet | | Square Feet as a % of Total Portfolio | | Average Annual Rent (in 000's) | | Average Annual Rent as a % of Total Portfolio |
| Quick Service Restaurant | | 276 | | | 772,358 | | | 4.0 | % | | 27,564 | | | 12.1 | % |
| Consumer Products | | 12 | | | 6,738,395 | | | 34.7 | % | | 25,023 | | | 11.0 | % |
| Discount Retail | | 278 | | | 2,702,451 | | | 13.9 | % | | 24,815 | | | 10.9 | % |
| Retail Banking | | 161 | | | 858,779 | | | 4.4 | % | | 20,753 | | | 9.1 | % |
| Pharmacy | | 61 | | | 824,731 | | | 4.3 | % | | 19,987 | | | 8.8 | % |
| Family Dining | | 115 | | | 699,851 | | | 3.6 | % | | 16,087 | | | 7.1 | % |
| Freight | | 29 | | | 1,385,568 | | | 7.1 | % | | 16,028 | | | 7.0 | % |
| Casual Dining | | 97 | | | 715,369 | | | 3.7 | % | | 15,580 | | | 6.8 | % |
| Healthcare | | 21 | | | 656,638 | | | 3.4 | % | | 13,073 | | | 5.7 | % |
| Insurance | | 1 | | | 818,686 | | | 4.2 | % | | 10,821 | | | 4.8 | % |
| Total | | 1,051 | | | 16,172,826 | | | 83.3 | % | | $ | 189,731 | | | 83.3 | % |
| | | | | | | | | | | | | | | | | |
Geographic Concentration
| State/Possession | | Number of Properties | | Square Feet | | Square Feet as a % of Total Portfolio | | Average Annual Rent (in 000's) | | Average Annual Rent as a % of Total Portfolio |
| Illinois | | 42 | | | 1,486,911 | | | 7.7 | % | | 19,123 | | | 8.4 | % |
| Texas | | 127 | | | 983,549 | | | 5.1 | % | | 15,323 | | | 6.7 | % |
| Michigan | | 78 | | | 677,709 | | | 3.5 | % | | 12,674 | | | 5.6 | % |
| California | | 16 | | | 1,450,328 | | | 7.5 | % | | 12,488 | | | 5.5 | % |
| Missouri | | 86 | | | 942,859 | | | 4.9 | % | | 11,019 | | | 4.8 | % |
| North Carolina | | 54 | | | 1,123,948 | | | 5.8 | % | | 10,840 | | | 4.8 | % |
| Ohio | | 63 | | | 1,197,640 | | | 6.2 | % | | 10,754 | | | 4.7 | % |
| Georgia | | 64 | | | 403,579 | | | 2.1 | % | | 8,896 | | | 3.9 | % |
| Pennsylvania | | 69 | | | 365,231 | | | 1.9 | % | | 8,697 | | | 3.8 | % |
| Mississippi | | 36 | | | 1,380,764 | | | 7.1 | % | | 8,327 | | | 3.7 | % |
| Total | | 635 | | | 10,012,518 | | | 51.8 | % | | $ | 118,141 | | | 51.9 | % |
| | | | | | | | | | | | | | | | | |
American Realty Capital Properties, Inc.
Tenant Diversification(1)
| Tenant | | Number of Properties | | Square Feet | | Square Feet as a % of Total Portfolio | | Average Remaining Lease Term (2) | | Industry | | Average Annual Rent (in 000's) | | Average Annual Rent as a % of Total Portfolio |
| 3432, LLC | | 1 | | | 4,283 | | | 0.02 | % | | 14.2 | | | Family Dining | | 89 | | | 0.04 | % |
| 7-Eleven | | 4 | | | 10,526 | | | 0.05 | % | | 6.0 | | | Gas/Convenience | | 411 | | | 0.18 | % |
| Academy Sports | | 2 | | | 133,713 | | | 0.69 | % | | 15.4 | | | Specialty Retail | | 1,455 | | | 0.64 | % |
| ADF Companies Group | | 1 | | | 2,626 | | | 0.01 | % | | 2.0 | | | Family Dining | | 66 | | | 0.03 | % |
| Advance Auto | | 54 | | | 380,171 | | | 1.96 | % | | 8.4 | | | Auto Retail | | 5,259 | | | 2.31 | % |
| Advanced Dental Implant and Denture Center, LLC | | 1 | | | 2,775 | | | 0.01 | % | | 11.0 | | | Healthcare | | 40 | | | 0.02 | % |
| AFC Enterprises | | 1 | | | 1,564 | | | 0.01 | % | | 0.7 | | | Quick Service Restaurant | | 30 | | | 0.01 | % |
| Ale House Management | | 3 | | | 18,807 | | | 0.10 | % | | 4.8 | | | Casual Dining | | 636 | | | 0.28 | % |
| AMCOR | | 1 | | | 221,035 | | | 1.14 | % | | 10.1 | | | Consumer Products | | 1,480 | | | 0.65 | % |
| Ameriprise | | 1 | | | 145,003 | | | 0.75 | % | | 11.5 | | | Financial Services | | 1,269 | | | 0.56 | % |
| AM-PM Enterprises III, Inc. | | 1 | | | 3,530 | | | 0.02 | % | | 19.1 | | | Quick Service Restaurant | | 42 | | | 0.02 | % |
| Ann Ching Chen | | 1 | | | 6,948 | | | 0.04 | % | | 1.3 | | | Family Dining | | 92 | | | 0.04 | % |
| AON Corporation | | 1 | | | 818,686 | | | 4.22 | % | | 11.5 | | | Insurance | | 10,822 | | | 4.75 | % |
| Arbed Tosa 100 | | 1 | | | 5,712 | | | 0.03 | % | | 11.9 | | | Casual Dining | | 172 | | | 0.08 | % |
| Arby's Restaurant Group, Inc. | | 35 | | | 104,229 | | | 0.54 | % | | 5.1 | | | Quick Service Restaurant | | 3,753 | | | 1.65 | % |
| Auto Zone | | 1 | | | 6,782 | | | 0.03 | % | | 15.5 | | | Auto Retail | | 152 | | | 0.07 | % |
| Baxters Steakhouse | | 1 | | | 5,186 | | | 0.03 | % | | 3.0 | | | Casual Dining | | 42 | | | 0.02 | % |
| Bed Bath & Beyond | | 1 | | | 1,035,840 | | | 5.34 | % | | 11.2 | | | Consumer Products | | 4,717 | | | 2.07 | % |
| Bee Mac Enterprises | | 2 | | | 4,232 | | | 0.02 | % | | 4.6 | | | Quick Service Restaurant | | 150 | | | 0.07 | % |
| Bighorn Associates | | 1 | | | 3,600 | | | 0.02 | % | | 3.5 | | | Casual Dining | | 121 | | | 0.05 | % |
| BJ's Warehouse | | 1 | | | 108,532 | | | 0.56 | % | | 10.4 | | | Discount Retail | | 883 | | | 0.39 | % |
| Black Angus Steakhouse, LLC | | 1 | | | 6,552 | | | 0.03 | % | | 5.9 | | | Casual Dining | | 295 | | | 0.13 | % |
| Bloomin Apple | | 1 | | | 4,234 | | | 0.02 | % | | 5.5 | | | Casual Dining | | 200 | | | 0.09 | % |
| Bojangles | | 13 | | | 47,824 | | | 0.25 | % | | 12.1 | | | Quick Service Restaurant | | 1,807 | | | 0.79 | % |
| Boston Market Corporation | | 4 | | | 13,713 | | | 0.07 | % | | 5.4 | | | Quick Service Restaurant | | 369 | | | 0.16 | % |
| Brinker International | | 2 | | | 10,640 | | | 0.05 | % | | 3.5 | | | Casual Dining | | 388 | | | 0.17 | % |
| Bruegger's Enterprises | | 2 | | | 5,265 | | | 0.03 | % | | 6.0 | | | Quick Service Restaurant | | 113 | | | 0.05 | % |
| Buca | | 2 | | | 14,885 | | | 0.08 | % | | 5.0 | | | Casual Dining | | 384 | | | 0.17 | % |
| Bullard Restaurants | | 1 | | | 2,693 | | | 0.01 | % | | 4.4 | | | Quick Service Restaurant | | 108 | | | 0.05 | % |
| Bullitt Ventures, Inc. | | 1 | | | 5,325 | | | 0.03 | % | | 10.2 | | | Family Dining | | 85 | | | 0.04 | % |
| Burger King | | 1 | | | 2,800 | | | 0.01 | % | | 11.2 | | | Quick Service Restaurant | | 85 | | | 0.04 | % |
| Burgerbusters, LLC | | 6 | | | 12,903 | | | 0.07 | % | | 5.7 | | | Quick Service Restaurant | | 579 | | | 0.25 | % |
| Caribou Coffee | | 1 | | | 1,625 | | | 0.01 | % | | 1.9 | | | Quick Service Restaurant | | 91 | | | 0.04 | % |
| Carlos O'Kelly's | | 9 | | | 47,349 | | | 0.24 | % | | 4.5 | | | Casual Dining | | 1,401 | | | 0.62 | % |
| Carrols | | 18 | | | 61,000 | | | 0.31 | % | | 7.6 | | | Quick Service Restaurant | | 1,982 | | | 0.87 | % |
| Charlestons | | 1 | | | 6,874 | | | 0.04 | % | | 1.7 | | | Casual Dining | | 122 | | | 0.05 | % |
| Checkers Drive-In Restaurants | | 12 | | | 9,540 | | | 0.05 | % | | 12.0 | | | Casual Dining | | 1,139 | | | 0.50 | % |
| Cherryden | | 1 | | | 7,213 | | | 0.04 | % | | 6.7 | | | Family Dining | | 223 | | | 0.10 | % |
| Chi-Co., Inc. | | 1 | | | 2,751 | | | 0.01 | % | | 4.5 | | | Quick Service Restaurant | | 74 | | | 0.03 | % |
| Circle K | | 3 | | | 9,460 | | | 0.05 | % | | 10.6 | | | Gas/Convenience | | 416 | | | 0.18 | % |
| Citizens Bank | | 156 | | | 698,366 | | | 3.60 | % | | 7.6 | | | Retail Banking | | 17,430 | | | 7.65 | % |
| CKE Restaurants | | 7 | | | 24,841 | | | 0.13 | % | | 6.9 | | | Quick Service Restaurant | | 568 | | | 0.25 | % |
| Community Bank | | 1 | | | 4,410 | | | 0.02 | % | | 3.1 | | | Retail Banking | | 36 | | | 0.02 | % |
| Corral Group | | 1 | | | 2,968 | | | 0.02 | % | | 8.0 | | | Quick Service Restaurant | | 63 | | | 0.03 | % |
| Cracker Barrel | | 5 | | | 50,479 | | | 0.26 | % | | 16.1 | | | Family Dining | | 1,605 | | | 0.70 | % |
| CVS | | 14 | | | 151,903 | | | 0.78 | % | | 9.6 | | | Pharmacy | | 3,226 | | | 1.42 | % |
| Darrin Cobb | | 1 | | | 5,180 | | | 0.03 | % | | 8.4 | | | Casual Dining | | 69 | | | 0.03 | % |
| Davco Restaurants | | 1 | | | 3,471 | | | 0.02 | % | | 12.5 | | | Quick Service Restaurant | | 133 | | | 0.06 | % |
| DaVita Dialysis | | 4 | | | 209,818 | | | 1.08 | % | | 10.6 | | | Healthcare | | 2,972 | | | 1.30 | % |
| Den Columbia | | 1 | | | 2,730 | | | 0.01 | % | | 3.6 | | | Family Dining | | 134 | | | 0.06 | % |
| Denny's Corporation | | 7 | | | 30,193 | | | 0.16 | % | | 3.6 | | | Family Dining | | 696 | | | 0.31 | % |
| Den-Tex Centra | | 4 | | | 21,098 | | | 0.11 | % | | 6.9 | | | Family Dining | | 505 | | | 0.22 | % |
| DineEquity Inc. | | 38 | | | 183,400 | | | 0.95 | % | | 6.6 | | | Family Dining | | 5,397 | | | 2.37 | % |
| Dollar General | | 227 | | | 2,093,589 | | | 10.79 | % | | 12.7 | | | Discount Retail | | 18,311 | | | 8.04 | % |
| Dunkin' Brands | | 1 | | | 2,880 | | | 0.01 | % | | 11.2 | | | Quick Service Restaurant | | 92 | | | 0.04 | % |
| Dynamic Management LLC | | 1 | | | 3,263 | | | 0.02 | % | | 5.2 | | | Quick Service Restaurant | | 61 | | | 0.03 | % |
| Einstein/Noah Bagel | | 1 | | | 3,875 | | | 0.02 | % | | 8.8 | | | Quick Service Restaurant | | 77 | | | 0.03 | % |
| Enterprises, LLC | | 1 | | | 2,759 | | | 0.01 | % | | 9.7 | | | Quick Service Restaurant | | 45 | | | 0.02 | % |
| Express Scripts | | 1 | | | 227,467 | | | 1.17 | % | | 8.5 | | | Healthcare | | 3,347 | | | 1.47 | % |
| Fal Co L.L.C | | 3 | | | 6,240 | | | 0.03 | % | | 9.2 | | | Quick Service Restaurant | | 47 | | | 0.02 | % |
| Family Dollar | | 49 | | | 411,922 | | | 2.12 | % | | 8.6 | | | Discount Retail | | 4,762 | | | 2.09 | % |
| FedEx | | 29 | | | 1,385,568 | | | 7.14 | % | | 10.3 | | | Freight | | 16,028 | | | 7.04 | % |
| Frandeli Group | | 11 | | | 237,898 | | | 1.23 | % | | 3.6 | | | Casual Dining | | 1,469 | | | 0.64 | % |
| Fresenius | | 14 | | | 116,226 | | | 0.60 | % | | 9.8 | | | Healthcare | | 2,482 | | | 1.09 | % |
| Fresh Creations, LLC | | 2 | | | 11,315 | | | 0.06 | % | | 9.9 | | | Family Dining | | 232 | | | 0.10 | % |
| Garden Fresh Restaurant | | 1 | | | 7,411 | | | 0.04 | % | | 10.8 | | | Family Dining | | 180 | | | 0.08 | % |
| GBM, LLC | | 2 | | | 5,700 | | | 0.03 | % | | 6.1 | | | Quick Service Restaurant | | 119 | | | 0.05 | % |
| GDK Development | | 1 | | | 3,682 | | | 0.02 | % | | 3.3 | | | Quick Service Restaurant | | 56 | | | 0.02 | % |
| GE Aviation | | 1 | | | 303,035 | | | 1.56 | % | | 11.4 | | | Aerospace | | 2,511 | | | 1.10 | % |
| Geko | | 1 | | | 5,012 | | | 0.03 | % | | 16.8 | | | Casual Dining | | 107 | | | 0.05 | % |
| General Mills | | 2 | | | 1,872,112 | | | 9.65 | % | | 9.6 | | | Consumer Products | | 6,670 | | | 2.93 | % |
| Tenant | | Number of Properties | | Square Feet | | Square Feet as a % of Total Portfolio | | Average Remaining Lease Term (2) | | Industry | | Average Annual Rent (in 000's) | | Average Annual Rent as a % of Total Portfolio |
| Georgetowne Affiliates | | 1 | | | 3,102 | | | 0.02 | % | | 7.1 | | | Quick Service Restaurant | | 68 | | | 0.03 | % |
| Globamax Restaurants | | 1 | | | 3,600 | | | 0.02 | % | | 13.4 | | | Casual Dining | | 71 | | | 0.03 | % |
| GMRI, Inc. | | 2 | | | 12,190 | | | 0.06 | % | | 2.8 | | | Casual Dining | | 382 | | | 0.17 | % |
| Golden Corral | | 18 | | | 175,150 | | | 0.90 | % | | 1.6 | | | Family Dining | | 3,191 | | | 1.40 | % |
| Grandys | | 5 | | | 20,584 | | | 0.11 | % | | 3.5 | | | Casual Dining | | 315 | | | 0.14 | % |
| GSA | | 12 | | | 217,615 | | | 1.12 | % | | 6.8 | | | Government Services | | 5,833 | | | 2.56 | % |
| H & K Partners | | 1 | | | 2,000 | | | 0.01 | % | | 13.9 | | | Quick Service Restaurant | | 99 | | | 0.04 | % |
| Hanesbrands | | 1 | | | 758,463 | | | 3.91 | % | | 11.2 | | | Consumer Products | | 2,366 | | | 1.04 | % |
| HB Boys | | 1 | | | 2,437 | | | 0.01 | % | | 23.9 | | | Quick Service Restaurant | | 109 | | | 0.05 | % |
| Heartland | | 2 | | | 6,139 | | | 0.03 | % | | 2.8 | | | Quick Service Restaurant | | 283 | | | 0.12 | % |
| Home Depot | | 1 | | | 465,600 | | | 2.40 | % | | 16.4 | | | Home Maintenance | | 2,258 | | | 0.99 | % |
| Hometown Folks | | 2 | | | 6,252 | | | 0.03 | % | | 19.2 | | | Quick Service Restaurant | | 204 | | | 0.09 | % |
| Houlihan's Restaurant Group | | 1 | | | 10,089 | | | 0.05 | % | | 3.9 | | | Casual Dining | | 273 | | | 0.12 | % |
| Hy-Vee | | 1 | | | 40,461 | | | 0.21 | % | | 10.5 | | | Supermarket | | 326 | | | 0.14 | % |
| Interfoods of America | | 3 | | | 6,440 | | | 0.03 | % | | 4.7 | | | Quick Service Restaurant | | 232 | | | 0.10 | % |
| Iron Mountain | | 1 | | | 126,664 | | | 0.65 | % | | 4.5 | | | Storage Facility | | 443 | | | 0.19 | % |
| J.C. Corral, Inc. | | 1 | | | 9,952 | | | 0.05 | % | | 6.1 | | | Family Dining | | 162 | | | 0.07 | % |
| Jack In The Box, Inc. | | 45 | | | 120,417 | | | 0.62 | % | | 3.6 | | | Quick Service Restaurant | | 5,202 | | | 2.28 | % |
| JCS Holdings, Inc. | | 3 | | | 16,718 | | | 0.09 | % | | 6.1 | | | Casual Dining | | 501 | | | 0.22 | % |
| John C. Brown | | 1 | | | 6,002 | | | 0.03 | % | | — | | | Family Dining | | 42 | | | 0.02 | % |
| John Deere | | 1 | | | 552,960 | | | 2.85 | % | | 4.6 | | | Specialty Retail | | 2,353 | | | 1.03 | % |
| Kaiser Foundation | | 1 | | | 100,352 | | | 0.52 | % | | 9.6 | | | Healthcare | | 4,233 | | | 1.86 | % |
| Ker Management Services, LLC | | 2 | | | 14,105 | | | 0.07 | % | | 9.3 | | | Casual Dining | | 236 | | | 0.10 | % |
| Key Bank | | 1 | | | 3,575 | | | 0.02 | % | | 9.5 | | | Retail Banking | | 98 | | | 0.04 | % |
| K-MAC Holdings Corp | | 1 | | | 2,121 | | | 0.01 | % | | 1.1 | | | Quick Service Restaurant | | 115 | | | 0.05 | % |
| Kohl's | | 1 | | | 88,408 | | | 0.46 | % | | 10.6 | | | Discount Retail | | 859 | | | 0.38 | % |
| Koning Restaurants International | | 2 | | | 5,860 | | | 0.03 | % | | 7.3 | | | Family Dining | | 106 | | | 0.05 | % |
| Krystal | | 23 | | | 50,447 | | | 0.26 | % | | 19.3 | | | Quick Service Restaurant | | 2,584 | | | 1.13 | % |
| Krystal (GE Portfolio) | | 4 | | | 8,926 | | | 0.05 | % | | 4.9 | | | Quick Service Restaurant | | 429 | | | 0.19 | % |
| Kum & Go | | 12 | | | 55,057 | | | 0.28 | % | | 18.3 | | | Gas/Convenience | | 2,707 | | | 1.19 | % |
| Leeann Chin | | 3 | | | 9,051 | | | 0.05 | % | | 7.9 | | | Quick Service Restaurant | | 263 | | | 0.12 | % |
| Little General Store, Inc. | | 1 | | | 1,940 | | | 0.01 | % | | 9.4 | | | Quick Service Restaurant | | 49 | | | 0.02 | % |
| Logan's Roadhouse | | 6 | | | 48,406 | | | 0.25 | % | | 13.4 | | | Casual Dining | | 1,821 | | | 0.80 | % |
| Mattress Firm | | 6 | | | 47,912 | | | 0.25 | % | | 9.8 | | | Specialty Retail | | 853 | | | 0.37 | % |
| Meritage Group | | 1 | | | 2,606 | | | 0.01 | % | | 2.7 | | | Quick Service Restaurant | | 106 | | | 0.05 | % |
| Metro Corral Partners | | 1 | | | 12,260 | | | 0.06 | % | | 10.9 | | | Family Dining | | 393 | | | 0.17 | % |
| Michael Callahan | | 1 | | | 3,206 | | | 0.02 | % | | 1.2 | | | Quick Service Restaurant | | 84 | | | 0.04 | % |
| Michigan Mult-King | | 1 | | | 2,036 | | | 0.01 | % | | 2.8 | | | Quick Service Restaurant | | 88 | | | 0.04 | % |
| Midwest BBQ Ventures, LLC | | 1 | | | 5,803 | | | 0.03 | % | | — | | | Casual Dining | | 202 | | | 0.09 | % |
| Mountain Range Restaurants | | 1 | | | 5,985 | | | 0.03 | % | | 6.6 | | | Family Dining | | 91 | | | 0.04 | % |
| MrEats Corral, LLC | | 1 | | | 9,952 | | | 0.05 | % | | 0.8 | | | Family Dining | | 221 | | | 0.10 | % |
| Mrs. Baird's | | 1 | | | 75,050 | | | 0.39 | % | | 3.9 | | | Consumer Goods | | 631 | | | 0.28 | % |
| NBI Food Services | | 1 | | | 2,900 | | | 0.01 | % | | 11.9 | | | Quick Service Restaurant | | 97 | | | 0.04 | % |
| NEA-BBQ, LLC | | 3 | | | 16,920 | | | 0.09 | % | | 4.9 | | | Casual Dining | | 416 | | | 0.18 | % |
| North Country Management | | 1 | | | 3,400 | | | 0.02 | % | | 5.5 | | | Quick Service Restaurant | | 69 | | | 0.03 | % |
| NTB | | 1 | | | 12,244 | | | 0.06 | % | | 10.4 | | | Auto Services | | 146 | | | 0.06 | % |
| NTW & Big O Tires | | 2 | | | 17,159 | | | 0.09 | % | | 10.6 | | | Auto Services | | 312 | | | 0.14 | % |
| Ohio Valley Bistros | | 1 | | | 8,242 | | | 0.04 | % | | 5.0 | | | Casual Dining | | 333 | | | 0.15 | % |
| Ok Apple, Inc. | | 1 | | | 4,761 | | | 0.02 | % | | 11.0 | | | Casual Dining | | 223 | | | 0.10 | % |
| O'Reilly Auto | | 2 | | | 12,084 | | | 0.06 | % | | 14.2 | | | Auto Retail | | 166 | | | 0.07 | % |
| Pacific Bells | | 3 | | | 6,594 | | | 0.03 | % | | 10.7 | | | Quick Service Restaurant | | 424 | | | 0.19 | % |
| Pantry Gas & Convenience | | 11 | | | 32,393 | | | 0.17 | % | | 8.8 | | | Gas/Convenience | | 2,746 | | | 1.21 | % |
| PENNANT FOODS CORP. | | 10 | | | 29,417 | | | 0.15 | % | | 4.6 | | | Quick Service Restaurant | | 928 | | | 0.41 | % |
| Pilot Flying J | | 1 | | | 17,480 | | | 0.09 | % | | 5.5 | | | Gas/Convenience | | 970 | | | 0.43 | % |
| Platinum Corral, LLC | | 2 | | | 22,382 | | | 0.12 | % | | 2.1 | | | Family Dining | | 431 | | | 0.19 | % |
| Price Rite | | 1 | | | 42,100 | | | 0.22 | % | | 14.7 | | | Supermarket | | 354 | | | 0.16 | % |
| Prometheus Partners | | 11 | | | 27,601 | | | 0.14 | % | | 8.4 | | | Quick Service Restaurant | | 1,342 | | | 0.59 | % |
| Qdoba | | 2 | | | 5,000 | | | 0.03 | % | | 9.8 | | | Quick Service Restaurant | | 209 | | | 0.09 | % |
| Quality Dining | | 4 | | | 19,573 | | | 0.10 | % | | 6.6 | | | Quick Service Restaurant | | 373 | | | 0.16 | % |
| Razzoos | | 1 | | | 6,607 | | | 0.03 | % | | 2.7 | | | Casual Dining | | 201 | | | 0.09 | % |
| Real Mex Restaurants | | 2 | | | 15,563 | | | 0.08 | % | | 9.5 | | | Casual Dining | | 417 | | | 0.18 | % |
| Reckitt Benckiser | | 1 | | | 32,000 | | | 0.16 | % | | 4.8 | | | Consumer Products | | 964 | | | 0.42 | % |
| Restaurant Management Co. | | 6 | | | 14,536 | | | 0.07 | % | | 3.2 | | | Family Dining | | 287 | | | 0.13 | % |
| Rite Aid | | 10 | | | 142,233 | | | 0.73 | % | | 14.8 | | | Pharmacy | | 3,503 | | | 1.54 | % |
| Roger K Osborne | | 1 | | | 2,850 | | | 0.01 | % | | 7.1 | | | Quick Service Restaurant | | 95 | | | 0.04 | % |
| Royal Capital | | 5 | | | 27,418 | | | 0.14 | % | | 9.6 | | | Family Dining | | 667 | | | 0.29 | % |
| Rubbermaid | | 2 | | | 1,160,820 | | | 5.98 | % | | 9.4 | | | Consumer Products | | 3,135 | | | 1.38 | % |
| Rubio's Restaurants | | 1 | | | 2,379 | | | 0.01 | % | | 1.2 | | | Casual Dining | | 120 | | | 0.05 | % |
| Ruby Tuesday, Inc. | | 6 | | | 30,851 | | | 0.16 | % | | 5.6 | | | Casual Dining | | 839 | | | 0.37 | % |
| Run Restaurants | | 1 | | | 6,356 | | | 0.03 | % | | 11.7 | | | Casual Dining | | 163 | | | 0.07 | % |
| Saulat Enterprises | | 10 | | | 36,844 | | | 0.19 | % | | 6.0 | | | Quick Service Restaurant | | 450 | | | 0.20 | % |
| Scotts Company | | 3 | | | 551,249 | | | 2.84 | % | | 9.5 | | | Consumer Products | | 1,512 | | | 0.66 | % |
| Shaw's Supermarkets | | 1 | | | 59,766 | | | 0.31 | % | | 7.7 | | | Supermarket | | 513 | | | 0.23 | % |
| Shoney's | | 6 | | | 31,939 | | | 0.16 | % | | 9.6 | | | Family Dining | | 375 | | | 0.16 | % |
| Tenant | | Number of Properties | | Square Feet | | Square Feet as a % of Total Portfolio | | Average Remaining Lease Term (2) | | Industry | | Average Annual Rent (in 000's) | | Average Annual Rent as a % of Total Portfolio |
| Shoot the Moon | | 1 | | | 5,208 | | | 0.03 | % | | 3.5 | | | Casual Dining | | 128 | | | 0.06 | % |
| Shorest, LLC | | 5 | | | 26,512 | | | 0.14 | % | | 10.2 | | | Family Dining | | 459 | | | 0.20 | % |
| Sonfish | | 2 | | | 6,737 | | | 0.03 | % | | 10.4 | | | Quick Service Restaurant | | 204 | | | 0.09 | % |
| Southeast New Mexico Foods | | 2 | | | 4,346 | | | 0.02 | % | | 19.2 | | | Quick Service Restaurant | | 122 | | | 0.05 | % |
| Southern Boys Restaurant Group | | 2 | | | 10,283 | | | 0.05 | % | | 2.3 | | | Family Dining | | 171 | | | 0.08 | % |
| Southern Rock Restaurants, LLC | | 1 | | | 3,389 | | | 0.02 | % | | 4.6 | | | Casual Dining | | 66 | | | 0.03 | % |
| Southern Star Management Group | | 1 | | | 2,763 | | | 0.01 | % | | 5.3 | | | Quick Service Restaurant | | 60 | | | 0.03 | % |
| Subhash Gupta | | 1 | | | 2,591 | | | 0.01 | % | | 3.8 | | | Quick Service Restaurant | | 66 | | | 0.03 | % |
| Subway Restaurants | | 1 | | | 2,485 | | | 0.01 | % | | 9.4 | | | Quick Service Restaurant | | 35 | | | 0.02 | % |
| Synovus Bank | | 1 | | | 3,744 | | | 0.02 | % | | 8.0 | | | Retail Banking | | 336 | | | 0.15 | % |
| Tacala | | 2 | | | 4,220 | | | 0.02 | % | | 5.8 | | | Quick Service Restaurant | | 199 | | | 0.09 | % |
| Talbots | | 1 | | | 313,000 | | | 1.61 | % | | 19.9 | | | Specialty Retail | | 3,803 | | | 1.67 | % |
| Tally Ho Partners | | 1 | | | 2,608 | | | 0.01 | % | | 6.9 | | | Quick Service Restaurant | | 61 | | | 0.03 | % |
| TCF National Bank | | 1 | | | 5,654 | | | 0.03 | % | | 17.1 | | | Retail Banking | | 104 | | | 0.05 | % |
| TD Bank | | 1 | | | 143,030 | | | 0.74 | % | | 11.5 | | | Retail Banking | | 2,750 | | | 1.21 | % |
| Texas Roadhouse, Inc. | | 9 | | | 59,852 | | | 0.31 | % | | 2.5 | | | Casual Dining | | 1,635 | | | 0.72 | % |
| The Bailey Company | | 1 | | | 3,477 | | | 0.02 | % | | 3.2 | | | Quick Service Restaurant | | 131 | | | 0.06 | % |
| Tire Kingdom | | 1 | | | 6,656 | | | 0.03 | % | | 10.2 | | | Auto Services | | 155 | | | 0.07 | % |
| Top Line Restaurants | | 1 | | | 7,025 | | | 0.04 | % | | 16.4 | | | Family Dining | | 125 | | | 0.05 | % |
| Tractor Supply | | 6 | | | 129,975 | | | 0.67 | % | | 12.1 | | | Specialty Retail | | 1,547 | | | 0.68 | % |
| Tripoli | | 1 | | | 4,558 | | | 0.02 | % | | 2.7 | | | Family Dining | | 164 | | | 0.07 | % |
| Twin Dragon LLC | | 1 | | | 6,400 | | | 0.03 | % | | 3.5 | | | Casual Dining | | 106 | | | 0.05 | % |
| United States Beef | | 5 | | | 14,725 | | | 0.08 | % | | 5.4 | | | Quick Service Restaurant | | 319 | | | 0.14 | % |
| Valenti Management | | 1 | | | 2,535 | | | 0.01 | % | | 8.3 | | | Quick Service Restaurant | | 148 | | | 0.06 | % |
| Vitamin Shoppe | | 1 | | | 3,500 | | | 0.02 | % | | 9.4 | | | Specialty Retail | | 166 | | | 0.07 | % |
| Vsgh Partners | | 2 | | | 4,802 | | | 0.02 | % | | 0.5 | | | Quick Service Restaurant | | 63 | | | 0.03 | % |
| Walgreens | | 37 | | | 530,595 | | | 2.73 | % | | 15.4 | | | Pharmacy | | 13,258 | | | 5.82 | % |
| Wendab Associates | | 4 | | | 11,831 | | | 0.06 | % | | 12.7 | | | Quick Service Restaurant | | 598 | | | 0.26 | % |
| Wendy's Company | | 1 | | | 3,199 | | | 0.02 | % | | 8.5 | | | Quick Service Restaurant | | 108 | | | 0.05 | % |
| West Marine | | 1 | | | 15,404 | | | 0.08 | % | | 9.0 | | | Specialty Retail | | 277 | | | 0.12 | % |
| Williams Sonoma | | 1 | | | 1,106,876 | | | 5.70 | % | | 9.5 | | | Consumer Products | | 4,179 | | | 1.83 | % |
| Woodland Group | | 9 | | | 43,623 | | | 0.22 | % | | 5.2 | | | Casual Dining | | 1,311 | | | 0.58 | % |
| Yum! Brands | | 1 | | | 2,900 | | | 0.01 | % | | 6.8 | | | Quick Service Restaurant | | 112 | | | 0.05 | % |
| Z & H Foods, Inc. | | 3 | | | 5,295 | | | 0.03 | % | | 1.6 | | | Quick Service Restaurant | | 137 | | | 0.06 | % |
| Zee&Son, LLC | | 1 | | | 2,007 | | | 0.01 | % | | 19.2 | | | Family Dining | | 27 | | | 0.01 | % |
| Total | | 1,181 | | | 19,404,596 | | | 100 | % | | 9.9 | | | | | 227,764 | | | 100 | % |
_______________________________________________
(1) Excludesone vacant property classified as held for sale.
(2) Remaining lease term in years as ofJune 30, 2013.
American Realty Capital Properties, Inc.
Tenant Industry Diversification(1)
| Industry | | Number of Properties | | Square Feet | | Square Feet as a % of Total Portfolio | | Average Annual Rent (in 000's) | | Average Annual Rent as a % of Total Portfolio |
| Aerospace | | 1 | | | 303,035 | | | 1.6 | % | | $ | 2,511 | | | 1.1 | % |
| Auto Retail | | 57 | | | 399,037 | | | 2.1 | % | | 5,577 | | | 2.4 | % |
| Auto Services | | 4 | | | 36,059 | | | 0.2 | % | | 613 | | | 0.3 | % |
| Casual Dining | | 97 | | | 715,369 | | | 3.7 | % | | 15,580 | | | 6.8 | % |
| Consumer Goods | | 1 | | | 75,050 | | | 0.4 | % | | 631 | | | 0.3 | % |
| Consumer Products | | 12 | | | 6,738,395 | | | 34.7 | % | | 25,023 | | | 11.0 | % |
| Discount Retail | | 278 | | | 2,702,451 | | | 13.9 | % | | 24,815 | | | 10.9 | % |
| Family Dining | | 115 | | | 699,851 | | | 3.6 | % | | 16,087 | | | 7.1 | % |
| Financial Services | | 1 | | | 145,003 | | | 0.7 | % | | 1,269 | | | 0.6 | % |
| Freight | | 29 | | | 1,385,568 | | | 7.1 | % | | 16,028 | | | 7.0 | % |
| Gas/Convenience | | 31 | | | 124,916 | | | 0.6 | % | | 7,250 | | | 3.2 | % |
| Government Services | | 12 | | | 217,615 | | | 1.1 | % | | 5,833 | | | 2.6 | % |
| Healthcare | | 21 | | | 656,638 | | | 3.4 | % | | 13,073 | | | 5.7 | % |
| Home Maintenance | | 1 | | | 465,600 | | | 2.4 | % | | 2,258 | | | 1.0 | % |
| Insurance | | 1 | | | 818,686 | | | 4.2 | % | | 10,821 | | | 4.8 | % |
| Pharmacy | | 61 | | | 824,731 | | | 4.3 | % | | 19,987 | | | 8.8 | % |
| Quick Service Restaurant | | 276 | | | 772,358 | | | 4.0 | % | | 27,564 | | | 12.1 | % |
| Retail Banking | | 161 | | | 858,779 | | | 4.4 | % | | 20,753 | | | 9.1 | % |
| Specialty Retail | | 18 | | | 1,196,464 | | | 6.2 | % | | 10,456 | | | 4.6 | % |
| Storage Facility | | 1 | | | 126,664 | | | 0.7 | % | | 443 | | | 0.2 | % |
| Supermarket | | 3 | | | 142,327 | | | 0.7 | % | | 1,192 | | | 0.5 | % |
| Total | | 1,181 | | | 19,404,596 | | | 100 | % | | $ | 227,764 | | | 100 | % |
_______________________________________________
(1) Excludesone vacant property classified as held for sale.
American Realty Capital Properties, Inc.
Property Geographic Diversification(1)
| State/Possession | | Number of Properties | | Square Feet | | Square Feet as a % of Total Portfolio | | Average Annual Rent (in 000's) | | Average Annual Rent as a % of Total Portfolio |
| Alabama | | 43 | | | 578,951 | | | 3.0 | % | | $ | 8,121 | | | 3.6 | % |
| Arizona | | 8 | | | 74,227 | | | 0.4 | % | | 1,613 | | | 0.7 | % |
| Arkansas | | 18 | | | 250,618 | | | 1.3 | % | | 3,652 | | | 1.6 | % |
| California | | 16 | | | 1,450,328 | | | 7.5 | % | | 12,488 | | | 5.5 | % |
| Colorado | | 13 | | | 238,886 | | | 1.2 | % | | 4,673 | | | 2.1 | % |
| Connecticut | | 10 | | | 37,126 | | | 0.2 | % | | 1,184 | | | 0.5 | % |
| Delaware | | 4 | | | 12,369 | | | 0.1 | % | | 286 | | | 0.1 | % |
| Florida | | 36 | | | 188,676 | | | 1.0 | % | | 5,366 | | | 2.4 | % |
| Georgia | | 64 | | | 403,579 | | | 2.1 | % | | 8,896 | | | 3.9 | % |
| Idaho | | 8 | | | 71,565 | | | 0.4 | % | | 1,552 | | | 0.7 | % |
| Illinois | | 42 | | | 1,486,911 | | | 7.7 | % | | 19,123 | | | 8.4 | % |
| Indiana | | 28 | | | 1,762,150 | | | 9.1 | % | | 8,288 | | | 3.6 | % |
| Iowa | | 19 | | | 671,074 | | | 3.5 | % | | 4,810 | | | 2.1 | % |
| Kansas | | 22 | | | 1,305,125 | | | 6.7 | % | | 4,611 | | | 2.0 | % |
| Kentucky | | 27 | | | 263,260 | | | 1.4 | % | | 4,629 | | | 2.0 | % |
| Louisiana | | 28 | | | 221,238 | | | 1.1 | % | | 2,871 | | | 1.3 | % |
| Maine | | 2 | | | 146,430 | | | 0.8 | % | | 2,819 | | | 1.2 | % |
| Maryland | | 2 | | | 11,205 | | | 0.1 | % | | 366 | | | 0.2 | % |
| Massachusetts | | 18 | | | 435,195 | | | 2.2 | % | | 6,157 | | | 2.7 | % |
| Michigan | | 78 | | | 677,709 | | | 3.5 | % | | 12,674 | | | 5.6 | % |
| Minnesota | | 11 | | | 200,487 | | | 1.0 | % | | 1,693 | | | 0.7 | % |
| Mississippi | | 36 | | | 1,380,764 | | | 7.1 | % | | 8,327 | | | 3.7 | % |
| Missouri | | 86 | | | 942,859 | | | 4.9 | % | | 11,019 | | | 4.8 | % |
| Montana | | 5 | | | 55,377 | | | 0.3 | % | | 856 | | | 0.4 | % |
| Nebraska | | 3 | | | 25,355 | | | 0.1 | % | | 409 | | | 0.2 | % |
| Nevada | | 12 | | | 100,660 | | | 0.5 | % | | 2,414 | | | 1.1 | % |
| New Hampshire | | 10 | | | 65,328 | | | 0.3 | % | | 1,349 | | | 0.6 | % |
| New Jersey | | 8 | | | 85,721 | | | 0.4 | % | | 2,640 | | | 1.2 | % |
| New Mexico | | 10 | | | 54,475 | | | 0.3 | % | | 870 | | | 0.4 | % |
| New York | | 25 | | | 326,461 | | | 1.7 | % | | 7,522 | | | 3.3 | % |
| North Carolina | | 54 | | | 1,123,948 | | | 5.8 | % | | 10,840 | | | 4.8 | % |
| North Dakota | | 4 | | | 31,318 | | | 0.2 | % | | 572 | | | 0.3 | % |
| Ohio | | 63 | | | 1,197,640 | | | 6.2 | % | | 10,754 | | | 4.7 | % |
| Oklahoma | | 22 | | | 370,185 | | | 1.9 | % | | 2,882 | | | 1.3 | % |
| Oregon | | 6 | | | 25,143 | | | 0.1 | % | | 652 | | | 0.3 | % |
| Pennsylvania | | 69 | | | 365,231 | | | 1.9 | % | | 8,697 | | | 3.8 | % |
| Puerto Rico | | 2 | | | 31,050 | | | 0.2 | % | | 1,105 | | | 0.5 | % |
| Rhode Island | | 5 | | | 23,488 | | | 0.1 | % | | 636 | | | 0.3 | % |
| South Carolina | | 30 | | | 649,029 | | | 3.3 | % | | 6,920 | | | 3.0 | % |
| South Dakota | | 2 | | | 49,641 | | | 0.3 | % | | 415 | | | 0.2 | % |
| Tennessee | | 48 | | | 362,779 | | | 1.9 | % | | 6,526 | | | 2.9 | % |
| Texas | | 127 | | | 983,549 | | | 5.1 | % | | 15,323 | | | 6.7 | % |
| Utah | | 3 | | | 14,009 | | | 0.1 | % | | 415 | | | 0.2 | % |
| Vermont | | 4 | | | 15,432 | | | 0.1 | % | | 335 | | | 0.1 | % |
| Virginia | | 25 | | | 150,269 | | | 0.8 | % | | 3,395 | | | 1.5 | % |
| Washington | | 5 | | | 219,700 | | | 1.1 | % | | 3,139 | | | 1.4 | % |
| West Virginia | | 9 | | | 57,079 | | | 0.3 | % | | 1,434 | | | 0.6 | % |
| Wisconsin | | 7 | | | 187,439 | | | 1.0 | % | | 1,869 | | | 0.8 | % |
| Wyoming | | 4 | | | 23,558 | | | 0.1 | % | | 577 | | | 0.3 | % |
| Total | | 1,181 | | | 19,404,596 | | | 100 | % | | $ | 227,764 | | | 100 | % |
_______________________________________________
(1) Excludesone vacant property classified as held for sale
.
American Realty Capital Properties, Inc.
Property Building Type Diversification(1)
| Building Type | | Number of Properties | | Square Feet | | Square Feet as a % of Total Portfolio | | Average Annual Rent (in 000's) | | Average Annual Rent as a % of Total Portfolio |
| Retail | | 1,100 | | | 7,609,157 | | | 39.2 | % | | $ | 143,757 | | | 63.1 | % |
| Office | | 35 | | | 1,992,555 | | | 10.3 | % | | 33,275 | | | 14.6 | % |
| Distribution | | 46 | | | 9,802,884 | | | 50.5 | % | | 50,732 | | | 22.3 | % |
| Total | | 1,181 | | | 19,404,596 | | | 100 | % | | $ | 227,764 | | | 100 | % |
_______________________________________________
(1) Excludesone vacant property classified as held for sale.
American Realty Capital Properties, Inc.
Lease Expirations
| Year of Expiration | | Number of Leases Expiring | | Average Annual Rent (in 000's) | | % of Portfolio Average Annual Rent Expiring | | Leased Rentable Square Feet | | % of Portfolio Rentable Square Feet Expiring |
| July 31, 2013 through December 31, 2013 | | 7 | | | 605 | | | 0.3 | % | | 34,936 | | | 0.2 | % |
| 2014 | | 34 | | | 4,358 | | | 1.9 | % | | 200,243 | | | 1.0 | % |
| 2015 | | 46 | | | 5,009 | | | 2.2 | % | | 278,769 | | | 1.4 | % |
| 2016 | | 54 | | | 6,157 | | | 2.7 | % | | 256,987 | | | 1.3 | % |
| 2017 | | 100 | | | 13,117 | | | 5.8 | % | | 914,069 | | | 4.7 | % |
| 2018 | | 121 | | | 19,625 | | | 8.6 | % | | 1,328,382 | | | 6.8 | % |
| 2019 | | 71 | | | 10,436 | | | 4.6 | % | | 461,073 | | | 2.4 | % |
| 2020 | | 58 | | | 7,377 | | | 3.2 | % | | 300,376 | | | 1.6 | % |
| 2021 | | 63 | | | 13,635 | | | 6.0 | % | | 920,691 | | | 4.7 | % |
| 2022 | | 124 | | | 24,138 | | | 10.6 | % | | 4,073,687 | | | 21.0 | % |
| 2023 | | 70 | | | 25,437 | | | 11.2 | % | | 2,690,873 | | | 13.9 | % |
| Total | | 748 | | | 129,894 | | | 57.1 | % | | 11,460,086 | | | 59.0 | % |
American Realty Capital Properties, Inc.
Definitions
Average annual rent is annualized rental income or Net Operating Income under our leases reflecting straight-line rent adjustments associated with contractual rent increases in the leases as required by GAAP, as further adjusted to reflect the effect of (i) tenant concessions and abatements such as free rent, and (ii) in respect of our modified gross leased properties, the effect of operating expense reimbursement revenue less property operating expenses.
Creditworthy tenants are determined by us based on our own assessment of the tenant financial condition based on our underwriting criteria.
Funds from operations, core funds from operations and adjusted funds from operations (FFO/Core FFO/AFFO) -We define FFO, a non-GAAP measure, consistent with the standards established by the White Paper on FFO approved by the Board of Governors of NAREIT, as revised in February 2004 (the "White Paper"). The White Paper defines FFO as net income or loss computed in accordance with U.S. GAAP, excluding gains or losses from sales of property but including asset impairment writedowns, plus depreciation and amortization, after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO. Our FFO calculation complies with NAREIT’s policy described above.
The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time, especially if such assets are not adequately maintained or repaired and renovated as required by relevant circumstances and/or is requested or required by lessees for operational purposes in order to maintain the value disclosed. We believe that, since real estate values historically rise and fall with market conditions, including inflation, interest rates, the business cycle, unemployment and consumer spending, presentations of operating results for a REIT using historical accounting for depreciation may be less informative. Historical accounting for real estate involves the use of U.S. GAAP. Any other method of accounting for real estate such as the fair value method cannot be construed to be any more accurate or relevant than the comparable methodologies of real estate valuation found in U.S. GAAP. Nevertheless, we believe that the use of FFO, which excludes the impact of real estate related depreciation and amortization, provides a more complete understanding of our performance to investors and to management, and when compared year over year, reflects the impact on our operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses, and interest costs, which may not be immediately apparent from net income. We also add back to net income deriving FFO certain costs associated with our Merger and other transactions as these expenses and transactions do not reflect our operations in the current period. However, FFO, core FFO and AFFO, as described below, should not be construed to be more relevant or accurate than the current U.S. GAAP methodology in calculating net income or in its applicability in evaluating our operating performance. The method utilized to evaluate the value and performance of real estate under U.S. GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP FFO, core FFO and AFFO measures and the adjustments to U.S. GAAP in calculating FFO, core FFO and AFFO.
We consider FFO, core FFO adjusted to exclude acquisition related costs and AFFO, adjusted to exclude certain other non-cash income or expense items, useful indicators of the performance of a REIT. Because FFO calculations exclude such factors as depreciation and amortization of real estate assets and gains or losses from sales of operating real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), they facilitate comparisons of operating performance between periods and between other REITs in our peer group. Accounting for real estate assets in accordance with U.S. GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves.
Additionally, we believe that core FFO and AFFO, by excluding acquisition-related fees and expenses, provides information consistent with management's analysis of the operating performance of the properties. By providing core FFO and AFFO, we believe we are presenting useful information that assists investors and analysts to better assess the sustainability of our operating performance. Further, we believe core FFO and AFFO is useful in comparing the sustainability of our operating performance with the sustainability of the operating performance of other real estate companies, including exchange-traded and non-traded REITs.
American Realty Capital Properties, Inc.
Definitions
(Continued)
As a result, we believe that the use of FFO, core FFO and AFFO, together with the required U.S. GAAP presentations, provide a more complete understanding of our performance relative to our peers and a more informed and appropriate basis on which to make decisions involving operating, financing, and investing activities.
FFO, core FFO and AFFO are non-GAAP financial measures and do not represent net income as defined by U.S. GAAP. FFO, core FFO and AFFO do not represent cash flows from operations as defined by U.S. GAAP, are not indicative of cash available to fund all cash flow needs and liquidity, including our ability to pay distributions and should not be considered as alternatives to net income, as determined in accordance with U.S. GAAP, for purposes of evaluating our operating performance. Other REITs may not define FFO in accordance with the current NAREIT definition (as we do) or may interpret the current NAREIT definition differently than we do and/or calculate core FFO and AFFO differently than we do. Consequently, our presentation of FFO, core FFO and AFFO may not be comparable to other similarly titled measures presented by other REITs.
Investment grade - a determination made by major credit rating agencies.
