Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 06, 2019 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | EPRT | |
Entity Registrant Name | Essential Properties Realty Trust, Inc. | |
Entity Central Index Key | 0001728951 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Common Stock, Shares Outstanding | 81,032,709 | |
Entity Shell Company | true | |
Entity Current Reporting Status | Yes | |
Entity File Number | 001-38530 | |
Entity Tax Identification Number | 82-4005693 | |
Entity Address, Address Line One | 902 Carnegie Center Blvd. | |
Entity Address, Address Line Two | Suite 520 | |
Entity Address, City or Town | Princeton | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 08540 | |
City Area Code | 609 | |
Local Phone Number | 436-0619 | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Common Stock, $0.01 par value | |
Security Exchange Name | NYSE | |
Entity Incorporation, State or Country Code | MD | |
Document Quarterly Report | true | |
Document Transition Report | false |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Real estate investments, at cost: | |||
Land and improvements | $ 547,549 | $ 420,848 | |
Building and improvements | 1,117,702 | 885,656 | |
Lease incentives | 4,831 | 2,794 | |
Construction in progress | 10,229 | 1,325 | |
Intangible lease assets | 74,973 | 66,421 | |
Total real estate investments, at cost | 1,755,284 | 1,377,044 | |
Less: accumulated depreciation and amortization | (79,482) | (51,855) | |
Total real estate investments, net | 1,675,802 | 1,325,189 | |
Loans and direct financing lease receivables, net | 62,505 | 17,505 | |
Net investments | 1,738,307 | 1,342,694 | |
Cash and cash equivalents | 23,446 | 4,236 | |
Restricted cash | 2,776 | 12,003 | |
Straight-line rent receivable, net | 22,592 | 14,255 | |
Prepaid expenses and other assets, net | 18,357 | 7,712 | |
Total assets | [1] | 1,805,478 | 1,380,900 |
LIABILITIES AND EQUITY | |||
Secured borrowings, net of deferred financing costs | 305,702 | 506,116 | |
Unsecured term loan, net of deferred financing costs | 199,144 | 0 | |
Revolving credit facility | 155,000 | 34,000 | |
Intangible lease liabilities, net | 9,635 | 11,616 | |
Dividend payable | 17,652 | 13,189 | |
Accrued liabilities and other payables | 17,316 | 4,938 | |
Total liabilities | [1] | 704,449 | 569,859 |
Commitments and contingencies (see Note 12) | 0 | 0 | |
Stockholders' equity: | |||
Preferred stock, $0.01 par value; 150,000,000 authorized; none issued and outstanding as of September 30, 2019 and December 31, 2018 | 0 | 0 | |
Common stock, $0.01 par value; 500,000,000 authorized; 79,672,970 and 43,749,092 issued and outstanding as of September 30, 2019 and December 31, 2018, respectively | 796 | 431 | |
Additional paid-in capital | 1,120,300 | 569,407 | |
Distributions in excess of cumulative earnings | (22,733) | (7,659) | |
Accumulated other comprehensive loss | (5,001) | 0 | |
Total stockholders' equity | 1,093,362 | 562,179 | |
Non-controlling interests | 7,667 | 248,862 | |
Total equity | 1,101,029 | 811,041 | |
Total liabilities and equity | $ 1,805,478 | $ 1,380,900 | |
[1] | The consolidated balance sheets of Essential Properties Realty Trust, Inc. include assets and liabilities of consolidated variable interest entities (“VIEs”). See Notes 2 and 6. As of September 30, 2019 and December 31, 2018, with the exception of $17.5 million and $9.2 million, respectively, of dividends payable, all of the assets and liabilities of the Company were held by its operating partnership, a consolidated VIE. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Preferred shares, par value per share | $ 0.01 | $ 0.01 |
Preferred shares, authorized shares | 150,000,000 | 150,000,000 |
Preferred shares, issued shares | 0 | 0 |
Preferred shares, outstanding shares | 0 | 0 |
Common shares, par value per share | $ 0.01 | $ 0.01 |
Common shares, authorized shares | 500,000,000 | 500,000,000 |
Common shares, issued shares | 79,672,970 | 43,749,092 |
Common shares, outstanding shares | 79,672,970 | 43,749,092 |
Dividends payable | $ 17,652 | $ 13,189 |
Assets and Liabilities Not Held by Variable Interest Entities ("VIEs") | ||
Dividends payable | $ 17,500 | $ 9,200 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Revenues: | |||||
Rental revenue | $ 34,958 | $ 25,496 | $ 97,842 | $ 67,119 | |
Interest on loans and direct financing lease receivables | 940 | 220 | 1,669 | 379 | |
Other revenue, net | 393 | 26 | 641 | 75 | |
Total revenues | 36,291 | 25,742 | 100,152 | 67,573 | |
Expenses: | |||||
Interest (including $4,603 to related parties during the nine months ended September 30, 2018) | 7,207 | 6,563 | 20,074 | 23,474 | |
General and administrative | 7,530 | 3,529 | 16,455 | 9,872 | |
Property expenses | 442 | 494 | 2,334 | 1,221 | |
Depreciation and amortization | 11,141 | 8,763 | 30,367 | 22,842 | |
Provision for impairment of real estate | 0 | 770 | 1,921 | 3,526 | |
Total expenses | 26,320 | 20,119 | 71,151 | 60,935 | |
Other operating income: | |||||
Gain on dispositions of real estate, net | 4,087 | 1,455 | 8,237 | 5,100 | |
Income from operations | 14,058 | 7,078 | 37,238 | 11,738 | |
Other (loss)/income: | |||||
Loss on repurchase of secured borrowings | (4,353) | ||||
Interest | 114 | 655 | 723 | 719 | |
Income before income tax expense | 14,172 | 7,733 | 33,608 | 12,457 | |
Income tax expense | 66 | 26 | 209 | 143 | |
Net income | 14,106 | 7,707 | 33,399 | 12,314 | |
Net income attributable to non-controlling interests | (861) | (2,383) | $ (2,482) | (6,076) | (2,482) |
Net income attributable to stockholders and members | $ 13,245 | $ 5,324 | $ 27,323 | $ 9,832 | |
Basic weighted average shares outstanding | 72,483,932 | 42,364,754 | 42,237,460 | 58,375,745 | |
Basic net income per share | $ 0.18 | $ 0.12 | $ 0.13 | $ 0.46 | |
Diluted weighted average shares outstanding | 77,612,949 | 61,472,675 | 61,342,278 | 73,021,273 | |
Diluted net income per share | $ 0.18 | $ 0.12 | $ 0.13 | $ 0.45 |
Consolidated Statements of Op_2
Consolidated Statements of Operations (Parenthetical) (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
Interest expense related parties | $ 0 | $ 0 | $ 0 | $ 4,603,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net income | $ 14,106 | $ 7,707 | $ 33,399 | $ 12,314 |
Other comprehensive loss: | ||||
Unrealized loss on cash flow hedges | (2,010) | (5,784) | ||
Cash flow hedge gains reclassified to interest expense | (94) | (193) | ||
Total other comprehensive loss | (2,104) | (5,977) | ||
Comprehensive income | 12,002 | 7,707 | 27,422 | 12,314 |
Net income attributable to non-controlling interests | (861) | (2,383) | (6,076) | (2,482) |
Adjustment for cash flow hedge losses attributable to non-controlling interests | 15 | 975 | ||
Comprehensive income attributable to stockholders and members | $ 11,156 | $ 5,324 | $ 22,321 | $ 9,832 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' / Members' Equity (Unaudited) - USD ($) $ in Thousands | Total | Class A Units | Class B Units | Class C Units | Class D Units | Common Stock | Additional Paid-in Capital | Distributions in Excess of Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Stockholders' / Members' Equity | Non-Controlling Interests |
Balance at Dec. 31, 2017 | $ 181,402 | $ 86,668 | $ 574 | $ 94,064 | $ 96 | $ 181,402 | |||||
Contributions | 50,000 | 50,000 | 50,000 | ||||||||
Unit-based compensation expense | 242 | 193 | 49 | 242 | |||||||
Net income | 1,109 | 528 | 581 | 1,109 | |||||||
Balance at Mar. 31, 2018 | 232,753 | 137,196 | 767 | 94,645 | 145 | 232,753 | |||||
Balance at Dec. 31, 2017 | 181,402 | 86,668 | 574 | 94,064 | 96 | 181,402 | |||||
Net income | 12,314 | ||||||||||
Balance at Sep. 30, 2018 | 814,892 | $ 431 | $ 568,369 | $ (4,253) | 564,547 | $ 250,345 | |||||
Balance, shares at Sep. 30, 2018 | 43,749,092 | ||||||||||
Balance at Mar. 31, 2018 | 232,753 | 137,196 | 767 | 94,645 | 145 | 232,753 | |||||
Unit-based compensation expense | 201 | 180 | 21 | 201 | |||||||
Net income | 3,176 | 1,886 | 1,290 | 3,176 | |||||||
Balance at Jun. 24, 2018 | 236,130 | 139,082 | 947 | 95,935 | 166 | 236,130 | |||||
Contribution of Predecessor equity in exchange for OP Units | (139,082) | (947) | (95,935) | (166) | (236,130) | 236,130 | |||||
Initial public offering/common stock issuance | 455,000 | $ 325 | 454,675 | 455,000 | |||||||
Initial public offering/common stock issuance, shares | 32,500,000 | ||||||||||
Concurrent private placement of common stock | 108,999 | $ 78 | 108,921 | 108,999 | |||||||
Concurrent private placement of common stock, shares | 7,785,611 | ||||||||||
Concurrent private placement of OP Units | 16,001 | 16,001 | |||||||||
Costs related to issuance of common stock/initial public offering | (32,053) | (32,053) | (32,053) | ||||||||
Share-based compensation expense | 46 | 46 | 46 | ||||||||
Share-based compensation expense, shares | 691,290 | ||||||||||
Net income | 321 | 222 | 222 | 99 | |||||||
Balance at Jun. 30, 2018 | 784,444 | $ 403 | 531,589 | 222 | 532,214 | 252,230 | |||||
Balance, shares at Jun. 30, 2018 | 40,976,901 | ||||||||||
Balance at Jun. 24, 2018 | 236,130 | $ 139,082 | $ 947 | $ 95,935 | $ 166 | 236,130 | |||||
Net income | 8,029 | ||||||||||
Balance at Sep. 30, 2018 | 814,892 | $ 431 | 568,369 | (4,253) | 564,547 | 250,345 | |||||
Balance, shares at Sep. 30, 2018 | 43,749,092 | ||||||||||
Balance at Jun. 30, 2018 | 784,444 | $ 403 | 531,589 | 222 | 532,214 | 252,230 | |||||
Balance, shares at Jun. 30, 2018 | 40,976,901 | ||||||||||
Initial public offering/common stock issuance | 38,811 | $ 28 | 38,783 | 38,811 | |||||||
Initial public offering/common stock issuance, shares | 2,772,191 | ||||||||||
Costs related to issuance of common stock/initial public offering | (3,054) | (3,054) | (3,054) | ||||||||
Share-based compensation expense | 823 | 823 | 823 | ||||||||
Unit-based compensation expense | 228 | 228 | 228 | ||||||||
Dividends declared on common stock and OP Units | (14,068) | (9,800) | (9,800) | (4,268) | |||||||
Net income | 7,707 | ||||||||||
Net income | 7,708 | 5,325 | 5,325 | 2,383 | |||||||
Balance at Sep. 30, 2018 | 814,892 | $ 431 | 568,369 | (4,253) | 564,547 | 250,345 | |||||
Balance, shares at Sep. 30, 2018 | 43,749,092 | ||||||||||
Balance at Dec. 31, 2018 | $ 811,041 | $ 431 | 569,407 | (7,659) | 562,179 | 248,862 | |||||
Balance, shares at Dec. 31, 2018 | 43,749,092 | 43,749,092 | |||||||||
Initial public offering/common stock issuance | $ 245,525 | $ 140 | 245,385 | 245,525 | |||||||
Initial public offering/common stock issuance, shares | 14,030,000 | ||||||||||
Costs related to issuance of common stock/initial public offering | (10,887) | (10,887) | (10,887) | ||||||||
Share-based compensation expense | 1,007 | 1,007 | 1,007 | ||||||||
Share-based compensation expense, shares | 46,368 | ||||||||||
Unit-based compensation expense | 227 | 227 | 227 | ||||||||
Dividends declared on common stock and OP Units | (16,145) | (12,143) | (12,143) | (4,002) | |||||||
Net income | 8,723 | 6,129 | 6,129 | 2,594 | |||||||
Balance at Mar. 31, 2019 | 1,039,491 | $ 571 | 805,139 | (13,673) | 792,037 | 247,454 | |||||
Balance, shares at Mar. 31, 2019 | 57,825,460 | ||||||||||
Balance at Dec. 31, 2018 | $ 811,041 | $ 431 | 569,407 | (7,659) | 562,179 | 248,862 | |||||
Balance, shares at Dec. 31, 2018 | 43,749,092 | 43,749,092 | |||||||||
Net income | $ 33,399 | ||||||||||
Balance at Sep. 30, 2019 | $ 1,101,029 | $ 796 | 1,120,300 | (22,733) | $ (5,001) | 1,093,362 | 7,667 | ||||
Balance, shares at Sep. 30, 2019 | 79,672,970 | 79,672,970 | |||||||||
Balance at Mar. 31, 2019 | $ 1,039,491 | $ 571 | 805,139 | (13,673) | 792,037 | 247,454 | |||||
Balance, shares at Mar. 31, 2019 | 57,825,460 | ||||||||||
Unrealized losses on cash flow hedges | (3,773) | (2,838) | (2,838) | (935) | |||||||
Cash flow hedge gains reclassified to interest expense | (99) | (74) | (74) | (25) | |||||||
Share-based compensation expense | 1,028 | $ 7 | 1,021 | 1,028 | |||||||
Unit-based compensation expense | 216 | 216 | 216 | ||||||||
Dividends declared on common stock and OP Units | (16,917) | (12,725) | (12,725) | (4,192) | |||||||
Net income | 10,571 | 7,951 | 7,951 | 2,620 | |||||||
Balance at Jun. 30, 2019 | 1,030,517 | $ 578 | 806,376 | (18,447) | (2,912) | 785,595 | 244,922 | ||||
Balance, shares at Jun. 30, 2019 | 57,825,460 | ||||||||||
Initial public offering/common stock issuance | 75,000 | $ 33 | 74,967 | 75,000 | |||||||
Initial public offering/common stock issuance, shares | 3,344,805 | ||||||||||
Costs related to issuance of common stock/initial public offering | (1,607) | (1,607) | (1,607) | ||||||||
Conversion of equity in Secondary Offering | $ 185 | 237,795 | 237,980 | (237,980) | |||||||
Conversion of equity in Secondary Offering, shares | 18,502,705 | ||||||||||
Unrealized losses on cash flow hedges | (2,010) | (1,996) | (1,996) | (14) | |||||||
Cash flow hedge gains reclassified to interest expense | (94) | (93) | (93) | (1) | |||||||
Share-based compensation expense | 1,050 | 1,050 | 1,050 | ||||||||
Unit-based compensation expense | 1,719 | 1,719 | 1,719 | ||||||||
Dividends declared on common stock and OP Units | (17,652) | (17,531) | (17,531) | (121) | |||||||
Net income | 14,106 | 13,245 | 13,245 | 861 | |||||||
Balance at Sep. 30, 2019 | $ 1,101,029 | $ 796 | $ 1,120,300 | $ (22,733) | $ (5,001) | $ 1,093,362 | $ 7,667 | ||||
Balance, shares at Sep. 30, 2019 | 79,672,970 | 79,672,970 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 33,399 | $ 12,314 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 30,367 | 22,843 |
Amortization of lease incentive | 206 | 116 |
Amortization of above/below market leases and right of use assets, net | 529 | 283 |
Amortization of deferred financing costs and other assets | 2,174 | 1,982 |
Loss on repurchase of secured borrowings | 4,353 | |
Provision for impairment of real estate | 1,921 | 3,526 |
Gain on dispositions of real estate, net | (8,237) | (5,100) |
Straight-line rent receivable | (8,880) | (5,770) |
Equity-based compensation expense | 5,216 | 1,398 |
Adjustment to rental revenue for tenant credit/allowance for doubtful accounts | 25 | 311 |
Changes in other assets and liabilities: | ||
Prepaid expenses and other assets | (1,649) | 179 |
Accrued liabilities and other payables | 1,487 | (3,300) |
Net cash provided by operating activities | 60,911 | 28,782 |
Cash flows from investing activities: | ||
Proceeds from sales of investments, net | 51,712 | 40,906 |
Principal collections on loans and direct financing lease receivables | 4,689 | 55 |
Investments in loans receivable | (58,865) | (10,379) |
Deposits for prospective real estate investments | (3,991) | (150) |
Investment in real estate, including capital expenditures | (404,540) | (387,595) |
Investment in construction in progress | (12,378) | (14,307) |
Lease incentives paid | (2,038) | (269) |
Net cash used in investing activities | (425,411) | (371,739) |
Cash flows from financing activities: | ||
Proceeds from issuance of notes payable to related parties | 154,000 | |
Payments of principal on notes payable to related parties | (384,000) | |
Repayments of secured borrowings | (5,968) | (5,875) |
Repurchase of secured borrowings | (201,400) | |
Principal received on repurchased secured borrowings | 1,419 | |
Borrowings under term loan facility | 200,000 | |
Borrowings under revolving credit facility | 278,000 | |
Repayments under revolving credit facility | (157,000) | |
Deferred financing costs | (2,472) | (3,305) |
Capital contributions by members in Predecessor | 50,000 | |
Proceeds from issuance of common stock, net | 309,768 | 464,182 |
Offering costs | (1,613) | (2,395) |
Dividends paid | (46,251) | |
Net cash provided by financing activities | 374,483 | 397,607 |
Net increase (decrease) in cash and cash equivalents and restricted cash | 9,983 | 54,650 |
Cash and cash equivalents and restricted cash, beginning of period | 16,239 | 19,430 |
Cash and cash equivalents and restricted cash, end of period | 26,222 | 74,080 |
Reconciliation of cash and cash equivalents and restricted cash: | ||
Cash and cash equivalents | 23,446 | 73,271 |
Restricted cash | 2,776 | 809 |
Cash and cash equivalents and restricted cash, end of period | 26,222 | 74,080 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest, net of amounts capitalized | 22,763 | 22,093 |
Cash paid for income taxes | 60 | 48 |
Non-cash investing and financing activities: | ||
Reclassification from construction in progress upon project completion | 3,474 | 14,451 |
Net settlement of proceeds on the purchase and sale of investments | 4,960 | |
Non-cash investments in real estate and loan receivable activity | 9,176 | |
Lease liabilities arising from the recognition of right of use assets | 4,822 | |
Unrealized losses on cash flow hedges | 5,977 | |
Contribution of Predecessor equity in exchange for OP Units | 236,130 | |
Conversion of equity in Secondary Offering | 237,795 | |
Payable and accrued offering costs | 122 | 3,083 |
Discounts and fees on capital raised through issuance of common stock | 10,758 | 29,629 |
Payable and accrued deferred financing costs | 271 | |
Dividends declared | $ 17,652 | 14,068 |
Common Stock | ||
Cash flows from financing activities: | ||
Proceeds from concurrent private placement | 108,999 | |
Operating Partnership Unit | ||
Cash flows from financing activities: | ||
Proceeds from concurrent private placement | $ 16,001 |
Organization
Organization | 9 Months Ended |
Sep. 30, 2019 | |
Organization And Formation Activities [Abstract] | |
Organization | 1. Organization Essential Properties Realty Trust, Inc. (“EPRT Inc.” or the “Company”) is an internally managed real estate company that acquires, owns and manages primarily single-tenant properties that are net leased on a long-term basis to middle-market companies operating service-oriented or experience-based businesses. EPRT Inc. has a diversified portfolio that focuses on properties leased to tenants in businesses such as restaurants (including quick service, casual and family dining), car washes, automotive services, medical services, convenience stores, entertainment, early childhood education and health and fitness. EPRT Inc. generally acquires and leases freestanding, single-tenant commercial real estate facilities where a tenant services its customers and conducts activities that are essential to the generation of the tenant’s sales and profits. EPRT Inc. was organized on January 12, 2018 as a Maryland corporation. It has elected to be taxed as a real estate investment trust (“REIT”) for federal income tax purposes for the year ended December 31, 2018, and it believes that its current organizational and operational status and intended distributions will allow it to continue to so qualify. On June 25, 2018, EPRT Inc. completed its initial public offering (the “IPO”) of 32,500,000 shares of common stock, $0.01 par value per share, at an initial public offering price of $14.00 per share, pursuant to a registration statement on Form S-11 (File No. 333-225215), filed with the U.S. Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Securities Act”). On July 24, 2018, EPRT Inc. issued an additional 2,772,191 shares of common stock at the initial public offering price of $14.00 per share pursuant to the partial exercise of an option granted to the underwriters of its IPO. N et proceeds from the IPO and the issuance of shares to underwriters, after deducting underwriting discounts and commissions and other expenses, were $458.7 million Prior to the completion of the IPO, a number of formation transactions (the “Formation Transactions”) took place that were designed to facilitate the completion of the IPO. Among other things, on June 20, 2018, Essential Properties Realty Trust LLC (“EPRT LLC”) converted from a Delaware limited liability company into a Delaware limited partnership, changed its name to Essential Properties, L.P. (the “Operating Partnership”) and became the subsidiary through which EPRT Inc. holds substantially all of its assets and conducts its operations. Prior to the completion of the Formation Transactions, EPRT LLC was a wholly owned subsidiary of EPRT Holdings LLC (“EPRT Holdings” and, together with EPRT LLC, the “Predecessor”), and EPRT Holdings received 17,913,592 units of limited partnership interest in the Operating Partnership (“OP Units”) in connection with EPRT LLC’s conversion into a Delaware limited partnership. Essential Properties OP G.P., LLC, a wholly owned subsidiary of EPRT Inc., became the sole general partner of the Operating Partnership. The Formation Transactions were accounted for as a reorganization of entities under common control in the consolidated financial statements and the assets and liabilities of the Predecessor were recorded by EPRT Inc. at their historical carrying amounts. Concurrent with the completion of the IPO, EPRT Inc. received an additional $125.0 million investment from an affiliate of Eldridge Industries, LLC (“Eldridge”) in private placements (the “Concurrent Private Placement”) of 7,785,611 shares of EPRT Inc.’s common stock and 1,142,960 OP Units. EPRT Inc. contributed the net proceeds from the issuance of the 43,057,802 shares of common stock in its IPO (inclusive of the shares issued pursuant to the partial exercise by the underwriters of their option to purchase additional shares) and the Concurrent Private Placement of common stock to Eldridge to the Operating Partnership in exchange for a like number of OP Units. On March 18, 2019, EPRT Inc. completed a follow-on public offering (the “Follow-On Offering”) of 14,030,000 shares of common stock, including 1,830,000 shares of common stock purchased by the underwriters pursuant to an option to purchase additional shares, at an offering price of $17.50 per share, pursuant to registration statements on Form S-11 (File Nos. 333-230188 and 333-230252) filed with the SEC under the Securities Act. N et proceeds from the Follow-On Offering, after deducting underwriting discounts and commissions and other expenses, were $234.6 million On July 22, 2019, EPRT Holdings and Security Benefit Life Insurance Company (together, the “Selling Stockholders”), affiliates of Eldridge, completed a In August 2019, the Company established an “at the market” equity distribution program (“ATM Program”), through which the Company may, from time to time, publicly offer and sell shares of its common stock having an aggregate gross sales price of up to $200 million. Through September 30, 2019, the Company sold 3,344,805 shares of its common stock have under the ATM Program, at a weighted average price per share of $22.42, generating $75.0 million in gross proceeds. The Predecessor EPRT LLC was formed on March 30, 2016 as a Delaware limited liability company by its initial sole member, SCF Funding LLC (the “Parent”). EPRT LLC commenced operations on March 30, 2016 and the affairs of EPRT LLC were managed by Stonebriar Finance Holdings LLC (the “Manager”). The Parent and Manager were ultimately wholly owned through a series of Delaware limited liability companies by Eldridge. EPRT LLC’s operating agreement (the “EPRT LLC Operating Agreement”) provided certain limitations on the liability of the Parent and the Manager. These limitations included 1) that neither the Parent nor the Manager shall be liable for the debts, obligations, or liabilities of EPRT LLC solely by reason of being a member or manager of EPRT LLC, 2) that neither the Parent nor the Manager shall be liable to EPRT LLC or to any member of EPRT LLC or other person or entity who may become party to the EPRT LLC Operating Agreement for any breach of the EPRT LLC Operating Agreement arising under or in connection with the EPRT LLC Operating Agreement except for any act or omission made in bad faith, and 3) EPRT LLC indemnifies the Parent, Manager and officers from and against all losses, claims, damages, liabilities, costs and expenses except those resulting primarily from bad faith of the indemnitee. On January 31, 2017, EPRT LLC received additional capital contributions from Stonebriar Holdings LLC (“Stonebriar Holdings”) and members of EPRT LLC’s management (“EPRT Management”), and issued four classes of equity units: Class A, Class B, Class C and Class D. The Class A and Class C units have voting rights while the Class B and D units do not have voting rights. After these equity contributions, the Parent owned approximately 52.3% of EPRT LLC, Stonebriar Holdings owned approximately 45.7% and EPRT Management owned approximately 2.0%. On December 31, 2017, EPRT LLC reorganized (the “EPRT LLC Reorganization”) and the holders of the Class A, Class B, Class C and Class D units contributed all of their interests in EPRT LLC to EPRT Holdings in exchange for interests in EPRT Holdings with the same rights as the interests they held in EPRT LLC. The EPRT LLC Reorganization lacked economic substance, as the newly issued units of EPRT Holdings have the same rights and privileges as the previously issued units of EPRT LLC and there was no change in ownership percentages of the individual unitholders. As of December 31, 2017, EPRT LLC became a wholly owned subsidiary of EPRT Holdings. The EPRT LLC Reorganization was accounted for as a reorganization of entities under common control in the Predecessor’s consolidated financial statements and the assets and liabilities of EPRT LLC were recorded by EPRT Holdings at their historical carrying amounts. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Accounting The accompanying unaudited consolidated financial statements of the Company were prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the rules and regulations of the SEC. In the opinion of management, all adjustments of a normal recurring nature necessary for a fair presentation have been included. The results of operations for the three and nine months ended September 30, 2019 and 2018 are not necessarily indicative of the results for the full year. These unaudited financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as filed with the SEC in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018. Reclassification Certain amounts previously reported in the consolidated financial statements have been reclassified in the accompanying consolidated financial statements to conform to the current period’s presentation of gain on dispositions of real estate, net on the consolidated statements of operations for the three and nine months ended September 30, 2019. The Company has presented gain on dispositions of real estate, net as a component of income from operations in order to present gains and losses on dispositions of properties in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (ASC) 360-10-45-5. This change in presentation was made for the prior periods as the SEC has eliminated Rule 3-15(a) of Regulation S-X, which previously had required the Company to present gains and losses on sale of properties outside of continuing operations in the Company’s consolidated statements of operations. Additionally, the Company changed the presentation of its consolidated statements of stockholders’/members’ equity for the nine months ended September 30, 2018, as the SEC extended the annual disclosure requirements for changes in stockholders’ equity in Rule 3-04 of Regulation S-X to interim periods, now requiring both the year-to-date information and subtotals for each interim period. Additionally, certain amounts previously reported in the consolidated statements of operations have been reclassified to conform to the current period’s presentation of rental revenue (due to the adoption of the new lease accounting standard, as discussed further below), interest income and income tax expense. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and subsidiaries in which the Company has a controlling financial interest. All intercompany accounts and transactions have been eliminated in consolidation. As of September 30, 2019 and December 31, 2018, the Company held a 98.3% and 69.7% ownership interest in the Operating Partnership and the consolidated financial statements include the financial statements of the Operating Partnership as of these dates. See Note 8—Equity for changes in the ownership interest in the Operating Partnership. Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Real Estate Investments Investments in real estate are carried at cost less accumulated depreciation and impairment losses. The cost of investments in real estate reflects their purchase price or development cost. The Company evaluates each acquisition transaction to determine whether the acquired asset meets the definition of a business. Under Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business The Company allocates the purchase price of acquired properties accounted for as asset acquisitions to tangible and identifiable intangible assets or liabilities based on their relative fair values. Tangible assets may include land, site improvements and buildings. Intangible assets may include the value of in-place leases and above- and below-market leases and other identifiable intangible assets or liabilities based on lease or property specific characteristics. The Company incurs various costs in the leasing and development of its properties. Amounts paid to tenants that incentivize them to extend or otherwise amend an existing lease or to sign a new lease agreement are capitalized to lease incentives on the Company’s consolidated balance sheets. Tenant improvements are capitalized to building and improvements within the Company’s consolidated balance sheets. Costs incurred which are directly related to properties under development, which include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs and real estate taxes and insurance, are capitalized during the period of development as construction in progress. After the determination is made to capitalize a cost, it is allocated to the specific component of a project that benefited. Determination of when a development project commences, and capitalization begins, and when a development project has reached substantial completion, and is available for occupancy and capitalization must cease, involves a degree of judgment. The fair value of the tangible assets of an acquired property with an in-place operating lease is determined by valuing the property as if it were vacant, and the “as-if-vacant” value is then allocated to the tangible assets based on the fair value of the tangible assets. The fair value of in-place leases is determined by considering estimates of carrying costs during the expected lease-up periods, current market conditions, as well as costs to execute similar leases based on the specific characteristics of each tenant’s lease. The Company estimates the cost to execute leases with terms similar to the remaining lease terms of the in-place leases, including leasing commissions, legal and other related expenses. Factors the Company considers in this analysis include an estimate of the carrying costs during the expected lease-up periods considering current market conditions and costs to execute similar leases. In estimating carrying costs, the Company includes real estate taxes, insurance and other operating expenses, and estimates of lost rentals at market rates during the expected lease-up periods, which primarily range from six to 12 months. The fair value of above- or below-market leases is recorded based on the net present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between the contractual amount to be paid pursuant to the in-place lease and the Company’s estimate of the fair market lease rate for the corresponding in-place lease, measured over the remaining non-cancelable term of the lease including any below-market fixed rate renewal options for below-market leases. In making estimates of fair values for purposes of allocating purchase price, the Company utilizes a number of sources, including real estate valuations prepared by independent valuation firms. The Company also considers information and other factors including market conditions, the industry that the tenant operates in, characteristics of the real estate (e.g., location, size, demographics, value and comparative rental rates), tenant credit profile and the importance of the location of the real estate to the operations of the tenant’s business. Additionally, the Company considers information obtained about each property as a result of its pre-acquisition due diligence, marketing and leasing activities in estimating the fair value of the tangible and intangible assets acquired. The Company uses the information obtained as a result of its pre-acquisition due diligence as part of its consideration of the accounting standard governing asset retirement obligations and, when necessary, will record an asset retirement obligation as part of the purchase price allocation. Real estate investments that are intended to be sold are designated as “held for sale” on the consolidated balance sheets at the lesser of carrying amount or fair value less estimated selling costs when they meet specific criteria to be presented as held for sale. Real estate investments are no longer depreciated when they are classified as held for sale. If the disposal, or intended disposal, of certain real estate investments represents a strategic shift that has had or will have a major effect on the Company’s operations and financial results, the operations of such real estate investments would be presented as discontinued operations in the consolidated statements of operations for all applicable periods. Depreciation and Amortization Depreciation is computed using the straight-line method over the estimated useful lives of up to 40 years for buildings and 15 years for site improvements. During the three months ended September 30, 2019 and 2018, the Company recorded $9.4 million and $6.6 million, respectively, of depreciation on its real estate investments. During the nine months ended September 30, 2019 and 2018, the Company recorded $25.7 million and $17.6 million, respectively, of depreciation on its real estate investments. Lease incentives are amortized on a straight-line basis as a reduction of rental income over the remaining non-cancellable terms of the respective leases. If a tenant terminates its lease, the unamortized portion of the lease incentive is charged to rental revenue. Construction in progress is not depreciated until the development has reached substantial completion. Tenant improvements are depreciated over the non-cancellable term of the related lease or their estimated useful life, whichever is shorter. Capitalized above-market lease values are amortized on a straight-line basis as a reduction of rental revenue over the remaining non-cancellable terms of the respective leases. Capitalized below-market lease values are accreted on a straight-line basis as an increase to rental revenue over the remaining non-cancellable terms of the respective leases including any below-market fixed rate renewal option periods. Capitalized above-market ground lease values are accreted as a reduction of property expenses over the remaining terms of the respective leases. Capitalized below-market ground lease values are amortized as an increase to property expenses over the remaining terms of the respective leases and any expected below-market renewal option periods where renewal is considered probable. The value of in-place leases, exclusive of the value of above-market and below-market lease intangibles, is amortized to depreciation and amortization expense on a straight-line basis over the remaining periods of the respective leases. If a tenant terminates its lease, the unamortized portion of each intangible, including in-place lease values, is charged to depreciation and amortization expense, while above- and below-market lease adjustments are recorded within rental revenue in the consolidated statements of operations. Loans Receivable The Company holds its loans receivable for long-term investment. Loans receivable are carried at amortized cost, including related unamortized discounts or premiums, if any. The Company recognizes interest income on loans receivable using the effective-interest method applied on a loan-by-loan basis. Direct costs associated with originating loans are offset against any related fees received and the balance, along with any premium or discount, is deferred and amortized as an adjustment to interest income over the term of the related loan receivable using the effective-interest method. The Company periodically evaluates the collectability of its loans receivable, including accrued interest, by analyzing the underlying property‑level economics and trends, collateral value and quality and other relevant factors in determining the adequacy of its allowance for loan losses. A loan is determined to be impaired when, in management’s judgment based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Specific allowances for loan losses are provided for impaired loans on an individual loan basis in the amount by which the carrying value exceeds the estimated fair value of the underlying collateral less disposition costs. As of September 30, 2019 and December 31, 2018, the Company had no allowance for loan losses recorded in its consolidated financial statements. Direct Financing Lease Receivables Certain of the Company’s real estate investment transactions are accounted for as direct financing leases. The Company records the direct financing lease receivables at their net investment, determined as the aggregate minimum lease payments and the estimated non-guaranteed residual value of the leased property less unearned income. The unearned income is recognized over the term of the related lease so as to produce a constant rate of return on the net investment in the asset. The Company’s investment in direct financing lease receivables is reduced over the applicable lease term to its non-guaranteed residual value by the portion of rent allocated to the direct financing lease receivables. Subsequent to the adoption of ASC 842, Leases If and when an investment in direct financing lease receivables is identified for impairment evaluation, the Company will apply the guidance in both ASC 310, Receivables Leases Impairment of Long-Lived Assets If circumstances indicate that the carrying value of a property may not be recoverable, the Company reviews the property for impairment. This review is based on an estimate of the future undiscounted cash flows, excluding interest charges, expected to result from the property’s use and eventual disposition. These estimates consider factors such as expected future operating income, market and other applicable trends and residual value, as well as the effects of leasing demand, competition and other factors. If impairment exists due to the inability to recover the carrying value of a property, an impairment loss is recorded to the extent that the carrying value exceeds the estimated fair value of the property for properties to be held and used. For properties held for sale, the impairment loss is the adjustment to fair value less estimated cost to dispose of the asset. Impairment assessments have a direct impact on the consolidated statements of operations because recording an impairment loss results in an immediate negative adjustment to the consolidated statements of operations. During the three months ended September 30, 2019, the Company recorded no provision for impairment of real estate and recorded a $0.8 million provision for impairment of real estate during the three months ended September 30, 2018. During the nine months ended September 30, 2019 and 2018, the Company recorded a provision for impairment of real estate of $1.9 million and $3.5 million, respectively. Cash and Cash Equivalents Cash and cash equivalents includes cash in the Company’s bank accounts. The Company considers all cash balances and highly liquid investments with original maturities of three months or less to be cash and cash equivalents. The Company deposits cash with high quality financial institutions. These deposits are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”) up to an insurance limit. As of September 30, 2019 and December 31, 2018, the Company had deposits of $23.4 million and $4.2 million, respectively, of which $23.2 million and $4.0 million, respectively, were in excess of the amount insured by the FDIC. Although the Company bears risk to amounts in excess of those insured by the FDIC, it does not anticipate any losses as a result. Restricted Cash Restricted cash primarily consists of cash held with the trustee for the Company’s Master Trust Funding Program (as defined in Note 6—Secured Borrowings). This restricted cash is used to make principal and interest payments on the Company’s secured borrowings, to pay trust expenses and to acquire future real estate investments which will be pledged as collateral under the Master Trust Funding Program. See Note 6—Secured Borrowings for further discussion. Adjustment to Rental Revenue for Tenant Credit/Allowance for Doubtful Accounts The Company continually reviews receivables related to rent and unbilled rent receivables and determines collectability by taking into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. Prior to January 1, 2019, if the collectability of a receivable was in doubt, the accounts receivable and straight-line rent receivable balances were reduced by an allowance for doubtful accounts on the consolidated balance sheets or a direct write-off of the receivable was recorded in the consolidated statements of operations. The provision for doubtful accounts was included in property expenses in the Company’s consolidated statements of operations. If the accounts receivable balance or straight-line rent receivable balance was subsequently deemed to be uncollectible, such receivable amounts were written-off to the allowance for doubtful accounts. As of January 1, 2019, if the assessment of the collectability of substantially all payments due under a lease changes from probable to not probable, any difference between the rental revenue recognized to date and the lease payments that have been collected is recognized as a current period adjustment to rental revenue in the consolidated statements of operations. As of September 30, 2019 and December 31, 2018, the Company recorded an allowance for doubtful accounts of $0.1 million related to base rent receivable and recorded no allowance for doubtful accounts related to straight-line rent receivable. During the three months ended September 30, 2019, the Company recognized no adjustment to rental revenue and recognized an adjustment of approximately $25,000 to rental revenue during the nine months ended September 30, 2019. During the three and nine months ended September 30, 2018, the Deferred Financing Costs Financing costs related to establishing the Company’s 2018 Credit Facility and Revolving Credit Facility (as defined below) were deferred and are being amortized as an increase to interest expense in the consolidated statements of operations over the term of the facility and are reported as a component of prepaid expenses and other assets, net on the consolidated balance sheets. Financing costs related to the issuance of the Company’s secured borrowings under the Master Trust Funding Program and Term Loan Facility (as defined below) were deferred and are being amortized as an increase to interest expense in the consolidated statements of operations over the term of the related debt instrument and are reported as a reduction of the related debt balance on the consolidated balance sheets. Derivative Instruments In the normal course of business, the Company uses derivative financial instruments, which may include interest rate swaps, caps, options, floors and other interest rate derivative contracts, The Company records all derivatives on the consolidated balance sheets at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may also enter into derivative contracts that are intended to economically hedge certain risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. The accounting for subsequent changes in the fair value of these derivatives depends on whether each has been designed and qualifies for hedge accounting treatment. If a derivative is designated and qualifies for cash flow hedge accounting treatment, the change in the estimated fair value of the derivative is recorded in other comprehensive income (loss) in the consolidated statements of comprehensive income to the extent that it is effective. Any ineffective portion of a change in derivative fair value is immediately recorded in earnings. If the Company elects not to apply hedge accounting treatment (or for derivatives that do not qualify as hedges), any change in the fair value of these derivative instruments is recognized immediately in gains (losses) on derivative instruments in the consolidated statements of operations. Fair Value Measurement The Company estimates fair value of financial and non-financial assets and liabilities based on the framework established in fair value accounting guidance. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The hierarchy described below prioritizes inputs to the valuation techniques used in measuring the fair value of assets and liabilities. This hierarchy maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs to be used when available. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1—Quoted prices in active markets for identical assets and liabilities that the Company has the ability to access at the measurement date. Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability. Level 3—Unobservable inputs that reflect the Company’s own assumptions that market participants would use in the pricing of the asset or liability and are consequently not based on market activity, but rather through particular valuation techniques. Revenue Recognition The Company’s rental revenue is primarily rent received from tenants. Rent from tenants is recorded in accordance with the terms of each lease on a straight-line basis over the non-cancellable initial term of the lease from the later of the date of the commencement of the lease or the date of acquisition of the property subject to the lease. Rental revenue recognition begins when the tenant controls the space and continues through the term of the related lease. Because substantially all of the leases provide for rental increases at specified intervals, the Company records a straight-line rent receivable and recognizes revenue on a straight-line basis through the expiration of the non-cancelable term of the lease. The Company takes into account whether the collectability of rents is reasonably assured in determining the amount of straight-line rent to record. Generally, the Company’s leases provide the tenant with one or more multi-year renewal options, subject to generally the same terms and conditions provided under the initial lease term, including rent increases. If economic incentives make it reasonably certain that an option period to extend the lease will be exercised, the Company will include these options in determining the non-cancelable term of the lease. The Company defers rental revenue related to lease payments received from tenants in advance of their due dates. These amounts are presented within accrued liabilities and other payables on the Company’s consolidated balance sheets. Certain properties in the Company’s investment portfolio are subject to leases that provide for contingent rent based on a percentage of the tenant’s gross sales. For these leases, the Company recognizes contingent rental revenue when the threshold upon which the contingent lease payment is based is actually reached. During the three months ended September 30, 2019 and 2018, the Company recorded contingent rent of $0.1 million and $0.2 million. During the nine months ended September 30, 2019 and 2018, the Company recorded contingent rent of $0.7 million and $0.9 million, respectively. Organizational Costs Costs related to the initial organization of the Company and its subsidiaries are expensed as they are incurred and are recorded within general and administrative expense in the Company’s consolidated statements of operations. Offering Costs In connection with the IPO, the Follow-On Offering, and its ATM Program, the Company incurred legal, accounting and other offering-related costs. Such costs have been deducted from the gross proceeds of each of the IPO, Follow-On Offering and ATM Program. As of September 30, 2019 and December 31, 2018, the Company had capitalized a total of $47.6 million and $35.1 million, respectively, of such costs in the Company’s consolidated balance sheets. These costs are presented as a reduction of additional paid-in capital as of September 30, 2019 and December 31, 2018. Legal, accounting and other offering-related costs incurred in connection with the Secondary Offering were expensed as incurred and are recorded within general and administrative expense in the Company’s consolidated statements of operations. Gains and Losses on Dispositions of Real Estate On January 1, 2018, the Company adopted FASB ASU 2017-05, Other Income — Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets Income Taxes EPRT Inc. elected and qualified to be taxed as a REIT under sections 856 through 860 of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2018. REITs are subject to a number of organizational and operational requirements, including a requirement that 90% of ordinary “REIT taxable income” (as determined without regard to the dividends paid deduction or net capital gains) be distributed. As a REIT, the Company will generally not be subject to U.S. federal income tax to the extent that it meets the organizational and operational requirements and its distributions equal or exceed REIT taxable income. For the period subsequent to the effective date of its REIT election, the Company continues to meet the organizational and operational requirements and expects distributions to exceed net taxable income. Accordingly, no provision has been made for U.S. federal income taxes. Even though the Company has elected and qualifies for taxation as a REIT, it may be subject to state and local income and franchise taxes, and to federal income and excise tax on its undistributed income. Franchise taxes and federal excise taxes on the Company’s undistributed income, if any, are included in general and administrative expenses on the accompanying consolidated statements of operations. Additionally, taxable income from non-REIT activities managed through the Company's taxable REIT subsidiary is subject to federal, state, and local taxes. The Company analyzes its tax filing positions in all of the U.S. federal, state and local tax jurisdictions where it is required to file income tax returns, as well as for all open tax years in such jurisdictions. The Company follows a two-step process to evaluate uncertain tax positions. Step one, recognition, occurs when an entity concludes that a tax position, based solely on its technical merits, is more-likely-than-not to be sustained upon examination. Step two, measurement, determines the amount of benefit that is more-likely-than-not to be realized upon settlement. Derecognition of a tax position that was previously recognized would occur when the Company subsequently determines that a tax position no longer meets the more-likely-than-not threshold of being sustained. The use of a valuation allowance as a substitute for derecognition of tax positions is prohibited. As of September 30, 2019 and December 31, 2018, the Company did not record any accruals for uncertain tax positions. The Company’s policy is to classify interest expense and penalties in general and administrative expense in the consolidated statements of operations. During the three and nine months ended September 30, 2019 and 2018, the Company did not record any interest or penalties, and there are no interest or penalties accrued at September 30, 2019 and December 31, 2018. The 2018, 2017 and 2016 taxable years remain open to examination by federal and state taxing jurisdictions to which the Company is subject. Equity-Based Compensation In 2019 and 2018, EPRT Inc. granted shares of restricted common stock and restricted share units (“RSUs”) to its directors, executive officers and other employees that vest over multiple periods, subject to the recipient’s continued service. In 2019, EPRT Inc. granted performance-based RSUs to its executive officers, the final number of which is determined based off of market and subjective performance conditions and which vest over a multi-year period, subject to the recipient’s continued service. In 2017, the Predecessor granted unit-based compensation awards to certain of its employees and managers, as well as non-employees, consisting of units that vest over a multi-year period, subject to the recipient’s continued service. The Company accounts for the restricted common stock, RSUs and unit-based compensation in accordance with ASC 718, Compensation – Stock Compensation, which requires that such compensation be recognized in the financial statements based on their estimated grant-date fair value. The value of such awards is recognized as compensation expense in general and administrative expenses in the accompanying consolidated statements of operations over the requisite service periods. The Company recognizes compensation expense for equity-based compensation using the straight-line method based on the terms of the individual grant. Variable Interest Entities The FASB provides guidance for determining whether an entity is a variable interest entity (a “VIE”). VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. A VIE is required to be consolidated by its primary beneficiary, which is the party that (i) has the power to control the activities that most significantly impact the VIE’s economic performance and (ii) has the obligation to absorb losses, or the right to receive benefits, of the VIE that could potentially be significant to the VIE. Following the completion of the Formation Transactions, the Company concluded that the Operating Partnership is a VIE of which the Company is the primary beneficiary, as the Company has the power to direct the activities that most significantly impact the economic performance of the Operating Partnership . Substantially all of the Company’s assets and liabilities are held by the Operating Partnership. The assets and liabilities of the Operating Partnership are consolidated and reported as assets and liabilities on the Company’s consolidated balance sheet as of September 30, 2019 and December 31, 2018. As of he Company concluded that an entity which it had provided a $5.7 million mortgage loan receivable was a VIE because the terms of the loan agreement limited the entity’s ability to absorb expected losses or the entity’s right to receive expected residual returns. However, the Company was not the primary beneficiary of the entity, because the Company did not have the power to direct the activities that most significantly impact the entity’s economic |
Investments
Investments | 9 Months Ended |
Sep. 30, 2019 | |
Investments [Abstract] | |
Investments | 3. Investments As of September 30, 2019, the Company had investments in 917 property locations, including six developments in progress and one undeveloped land parcel. Of these 917 property locations, 831 represented owned properties (of which seven were subject to leases accounted for as direct financing leases or loans), 11 represented ground lease interests (of which one building was subject to a lease accounted for as a direct financing lease) and 75 represented properties which secure the Company’s investments in five mortgage loans receivable. The Company’s gross investment portfolio totaled $1.8 billion as of September 30, 2019 and consisted of gross acquisition cost of real estate investments (including transaction costs) totaling $1.8 billion, and loans and direct financing lease receivables, net, with an aggregate carrying amount of $62.5 million. As of December 31, 2018, the Company had investments in 665 property locations, including four developments in progress and one undeveloped land parcel, and additionally had three mortgage loans receivable secured by 12 additional properties. Of these 665 property locations, 652 represented owned properties (of which five were subject to leases accounted for as direct financing leases) and 13 represented ground lease interests (of which one building was subject to a lease accounted for as a direct financing lease). The Company’s gross investment portfolio totaled $1.4 billion as of December 31, 2018 and consisted of gross acquisition cost of real estate investments (including transaction costs) totaling $1.4 billion and loans and direct financing lease receivables, net, with an aggregate carrying amount of $17.5 million. As of December 31, 2018, 347 of these investments comprising $609.2 million of net investments were assets of consolidated special purpose entity subsidiaries and were pledged as collateral under the non-recourse obligations of the Company’s Master Trust Funding Program. Acquisitions in 2019 During the nine months ended September 30, 2019, the Company did not have any acquisitions that represented more than 5% of the Company’s total investment activity as of September 30, 2019. The following table presents information about the Company’s acquisition activity during the nine months ended September 30, 2019: (Dollar amounts in thousands) Total Investments Ownership type Fee Interest Number of properties acquired 205 Allocation of Purchase Price: Land and improvements $ 145,889 Building and improvements 259,182 Construction in progress (1) 12,378 Intangible lease assets 11,896 Assets acquired 429,345 Intangible lease liabilities (116 ) Liabilities assumed (116 ) Purchase price (including acquisition costs) $ 429,229 (1) Represents amounts incurred at and subsequent to acquisition and includes approximately $0.2 million of capitalized interest expense. Acquisitions in 2018 During the nine months ended September 30, 2018, the Company did not complete any acquisitions that represented more than 5% of the Company’s total investment activity as of September 30, 2018. The following table presents information about the Company’s acquisition activity during the nine months ended September 30, 2018: (Dollar amounts in thousands) Total Investments Ownership type (1) Number of properties acquired 165 Allocation of Purchase Price: Land and improvements $ 125,519 Building and improvements 253,754 Construction in progress (2) 14,307 Intangible lease assets 8,609 Assets acquired 402,189 Intangible lease liabilities (1,047 ) Liabilities assumed (1,047 ) Purchase price (including acquisition costs) $ 401,142 (1) During the nine months ended September 30, 2018, the Company acquired the fee interest in 164 properties and acquired one property subject to a ground lease arrangement. (2) Represents amounts incurred at and subsequent to acquisition and includes $0.2 million of capitalized interest. Gross Investment Activity During the nine months ended September 30, 2019 and 2018, the Company had the following gross investment activity: (Dollar amounts in thousands) Number of Investment Locations Dollar Amount of Investments Gross investments, January 1, 2018 508 $ 939,072 Acquisitions of and additions to real estate investments 165 403,218 Sales of investments in real estate (37) (38,174 ) Relinquishment of properties at end of ground lease term (2) (853 ) Provisions for impairment of real estate (1) (3,566 ) Investments in loans receivable 10,379 Principal collections on direct financing lease receivables (55 ) Other (2,772 ) Gross investments, September 30, 2018 1,307,249 Less: Accumulated depreciation and amortization (2) (43,630 ) Net investments, September 30, 2018 634 $ 1,263,619 Gross investments, January 1, 2019 677 $ 1,394,549 Acquisitions of and additions to real estate investments 205 433,208 Sales of investments in real estate (28) (51,568 ) Relinquishment of properties at end of ground lease term (2) (471 ) Provisions for impairment of real estate (4) (1,921 ) Investments in loans receivable 76 58,865 Principal collections on and settlements of loans and direct financing lease receivables (3) (11) (13,865 ) Other (1,008 ) Gross investments, September 30, 2019 1,817,789 Less: Accumulated depreciation and amortization (2) (79,482 ) Net investments, September 30, 2019 917 $ 1,738,307 (1) During the nine months ended September 30, 2018, the Company identified and recorded provisions for impairment at 7 vacant and 9 tenanted properties. The amount in the table above excludes approximately $40,000 related to intangible lease liabilities for these assets. (2) Includes $62.0 million and $31.4 million of accumulated depreciation as of September 30, 2019 and 2018, respectively. (3) During the nine months ended September 30, 2019, the Company acquired 10 properties that had secured two of its loans receivable for an aggregate purchase price of $11.8 million. These loans receivable had a carrying value of $9.2 million prior to their settlement. (4) During the nine months ended September 30, 2019, the Company identified and recorded provisions for impairment at 1 vacant and 5 tenanted properties. Real Estate Investments The Company’s investment properties are leased to tenants under long-term operating leases that typically include one or more renewal options. See Note 11—Leases for more information about the Company’s leases. Loans and Direct Financing Lease Receivables As of September 30, 2019 and December 31, 2018, the Company had six and four loans receivable outstanding with an aggregate carrying amount of $59.9 million and $14.9 million, respectively. During the nine months ended September 30, 2019, the borrowers under three of the Company’s loans receivable, with carrying values of $5.7 million, $3.5 million and $3.4 million, settled or repaid the loans in full. Additionally, the borrower under one of the Company’s loans receivable, with a maturity date in 2021, made a partial prepayment to the Company of $1.1 million. The Company also entered into five arrangements accounted for as loans receivable during the nine months ended September 30, 2019 with an aggregate carrying value of $58.7 million as of September 30, 2019. During the nine months ended September 30, 2018, the Company entered into three loan receivable arrangements. The Company’s loans receivable as of September 30, 2019 and December 31, 2018 are summarized as follows (dollar amounts in thousands): Principal Balance Outstanding Loan Type Monthly Payment Number of Secured Properties Interest Rate Maturity Date September 30, 2019 December 31, 2018 Mortgage (1)(2) Interest only 1 10.00% 2021 $ 1,263 $ 2,376 Mortgage (1) Interest only 7.55% 2019 — 5,748 Mortgage (1)(2) Interest only 5.25% 2019 — 3,500 Mortgage (1) Interest only 3 8.80% 2039 16,800 — Mortgage (2) Principal + Interest 2 8.10% 2059 5,125 — Mortgage (1) Interest only 2 8.53% 2039 7,300 — Mortgage (1) Interest only 69 8.16% 2034 28,000 — Development construction (2)(3) Principal + Interest 8.00% 2058 — 3,230 Leasehold interest (4) Principal + Interest (4) 10.69% 2039 1,435 — Net investment $ 59,923 $ 14,854 (1 ) Loan requires monthly payments of interest only with a balloon payment due at maturity. (2) Loan allows for prepayments in whole or in part without penalty. (3) Loan was secured by a mortgage on the building and improvements at the development property. The Company provided periodic funding to the borrower under this arrangement as construction progressed. (4) This leasehold interest transaction is accounted for as a loan receivable, as the lease for two land parcels contains an option for the lessee to repurchase the leased assets in 2024 or 2025. Scheduled principal payments due under the Company’s loans receivable as of September 30, 2019 were as follows: (in thousands) Loans Receivable October 1, 2019 - December 31, 2019 $ — 2020 9 2021 1,283 2022 22 2023 24 Thereafter 58,585 Total $ 59,923 As of September 30, 2019 and December 31, 2018, the Company had $2.6 million and $2.7 million, respectively, of net investments accounted for as direct financing lease receivables. The components of the investments accounted for as direct financing lease receivables were as follows: (in thousands) September 30, 2019 December 31, 2018 Minimum lease payments receivable $ 3,950 $ 4,198 Estimated unguaranteed residual value of leased assets 270 270 Unearned income from leased assets (1,638 ) (1,817 ) Net investment $ 2,582 $ 2,651 Scheduled future minimum non-cancelable base rental payments due to be received under the direct financing lease receivables as of September 30, 2019 were as follows: (in thousands) Future Minimum Base Rental Payments October 1, 2019 - December 31, 2019 $ 84 2020 337 2021 340 2022 345 2023 347 Thereafter 2,497 Total $ 3,950 Real Estate Investments Held for Sale The Company continually evaluates its portfolio of real estate investments and may elect to dispose of investments considering criteria including, but not limited to, tenant concentration, tenant credit quality, tenant operation type (e.g., industry, sector or concept/brand), unit-level financial performance, local market conditions and lease rates, associated indebtedness and asset location. Real estate investments held for sale are expected to be sold within twelve months. The following table shows the activity in real estate investments held for sale and intangible lease liabilities held for sale during the nine months ended September 30, 2019 and 2018 (Dollar amounts in thousands) Number of Properties Real Estate Investments Intangible Lease Liabilities Net Carrying Value Held for sale balance, December 31, 2017 3 $ 4,173 $ (129 ) $ 4,044 Transfers to held for sale classification 12 14,487 (256 ) 14,231 Sales (13 ) (17,253 ) 385 (16,868 ) Transfers to held and used classification — — — — Held for sale balance, September 30, 2018 2 $ 1,407 $ — $ 1,407 Held for sale balance, December 31, 2018 — $ — $ — $ — Transfers to held for sale classification 4 6,239 — 6,239 Sales (4 ) (6,239 ) — (6,239 ) Transfers to held and used classification — — — — Held for sale balance, September 30, 2019 — $ — $ — $ — Significant Concentrations The Company did not have any tenants (including for this purpose, all affiliates of such tenants) whose rental revenue for the nine months ended September 30, 2019 or 2018 represented 10% or more of total rental revenue in the Company’s consolidated statements of operations. The following table lists the states where the rental revenue from the properties in that state during the periods presented represented 10% or more of total rental revenue in the Company’s consolidated statements of operations: Three months ended September 30, Nine months ended September 30, State 2019 2018 2019 2018 Texas 11.9% 11.6% 12.2% 12.6% Georgia 10.5% 11.1% 10.9% 11.5% Intangible Assets and Liabilities Intangible assets and liabilities consisted of the following as of the dates presented: September 30, 2019 December 31, 2018 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Intangible assets: In-place leases $ 60,150 $ 13,041 $ 47,109 $ 50,317 $ 9,498 $ 40,819 Intangible market lease assets 14,823 4,460 10,363 16,104 4,144 11,960 Total intangible assets $ 74,973 $ 17,501 $ 57,472 $ 66,421 $ 13,642 $ 52,779 Intangible market lease liabilities $ 11,982 $ 2,347 $ 9,635 $ 14,894 $ 3,278 $ 11,616 The remaining weighted average amortization periods for the Company’s intangible assets and liabilities as of September 30, 2019, by category and in total, were as follows: Years Remaining In-place leases 9.7 Intangible market lease assets 8.3 Total intangible assets 9.4 Intangible market lease liabilities 17.3 The following table discloses amounts recognized within the consolidated statements of operations related to amortization of in-place leases, amortization and accretion of above- and below-market lease assets and liabilities, net and the amortization and accretion of above- and below-market ground leases for the periods presented: Three months ended September 30, Nine months ended September 30, (in thousands) 2019 2018 2019 2018 Amortization of in-place leases (1) $ 1,739 $ 2,117 $ 4,622 $ 5,260 Amortization (accretion) of market lease intangibles, net (2) 302 245 746 642 Amortization (accretion) of above- and below-market ground lease intangibles, net (3) — (90 ) — (358 ) (1) Reflected within depreciation and amortization expense. (2) Reflected within rental revenue. (3) Reflected within property expenses. The following table provides the projected amortization of in-place lease assets to depreciation and amortization expense and net amortization of above- and below-market lease intangibles to rental revenue for the next five years: (in thousands) October 1 - December 31, 2019 2020 2021 2022 2023 In-place lease assets $ 1,544 $ 5,417 $ 5,204 $ 5,052 $ 5,241 Adjustment to amortization expense $ 1,544 $ 5,417 $ 5,204 $ 5,052 $ 5,241 Above-market lease assets $ (326 ) $ (1,266 ) $ (1,247 ) $ (1,246 ) $ (1,214 ) Below-market lease liabilities 143 550 551 551 500 Net adjustment to rental revenue $ (183 ) $ (716 ) $ (696 ) $ (695 ) $ (714 ) Subsequent to September 30, 2019, the Company invested in 32 real estate investment properties for an aggregate investment (including acquisition-related costs) of $69.3 million and invested $4.8 million through new and ongoing construction in progress and reimbursements to tenants for development, construction and renovation costs. Subsequent to September 30, 2019, the Company sold its investment in 3 real estate properties |
Credit Facility
Credit Facility | 9 Months Ended |
Sep. 30, 2019 | |
Line Of Credit Facility [Abstract] | |
Credit Facility | 4. Credit Facility On June 25, 2018, the Company, through the Operating Partnership, entered into a revolving credit agreement with a group of lenders for a four-year, senior unsecured revolving credit facility (the “2018 Credit Facility”) with aggregate revolving credit commitments of $300.0 million. Barclays Bank PLC, Citigroup Global Markets Inc. and Goldman Sachs Bank USA were the joint lead arrangers of the 2018 Credit Facility, with Barclays Bank PLC acting as administrative agent. The 2018 Credit Facility had a term of four years, with an extension option of up to 12-months exercisable by the Operating Partnership, subject to certain conditions, and initially bore interest at an annual rate of applicable LIBOR, as defined therein, plus an applicable margin between 1.45% and 2.15%; or (ii) the prime rate plus an applicable margin of between 0.45% and 1.15%. The 2018 Credit Facility provides an accordion feature to increase, subject to certain conditions, the maximum availability of the 2018 Credit Facility by up to an additional On April 12, 2019, the Company, through the Operating Partnership, entered into a restated credit agreement (the “Amended Credit Facility”) with a group of lenders, amending and The Revolving Credit Facility has a term of four years from April 12, 2019, with an extension option of up to 12-months exercisable by the Operating Partnership, subject to certain conditions, and the Term Loan Facility has a term of five years from the effective date of the amended agreement. The loans under each of the Revolving Credit Facility and the Term Loan Facility initially bear interest at an annual rate of applicable LIBOR plus the applicable margin (which applicable margin varies between the Revolving Credit Facility and the Term Loan Facility). The applicable LIBOR is the rate with a term equivalent to the interest period applicable to the relevant borrowing. The applicable margin initially is a spread set according to a leverage-based pricing grid. At the Operating Partnership’s election, on and after receipt of an investment grade corporate credit rating from Standard & Poor’s (“S&P”) or Moody’s Investors Services, Inc. (“Moody’s”), the applicable margin will be a spread set according to the Company’s corporate credit ratings by S&P and/or Moody’s. The Amended Credit Facility is freely pre-payable at any time and is mandatorily payable if borrowings exceed the borrowing base or the facility limit. The Operating Partnership may re-borrow amounts paid down on the Revolving Credit Facility but not on the Term Loan Facility. The Operating Partnership is required to pay revolving credit fees throughout the term of the Amended Credit Facility based upon its usage of the Revolving Credit Facility, at a rate which depends on its usage of such facility during the period before the Company receives an investment grade corporate credit rating from S&P or Moody’s, and which rate shall be based on the corporate credit rating from S&P and/or Moody’s after the time, if applicable, the Company receives such a rating. The Operating Partnership was required to pay a ticking fee on the Term Loan Facility for the period from April 12, 2019 through May 14, 2019, the date the term loans were drawn. The Amended Credit Facility has an accordion feature to increase, subject to certain conditions, the maximum availability of credit (either through increased revolving commitments or additional term loans) by up to $200 million. The Operating Partnership is the borrower under the Amended Credit Facility, and the Company and each of its subsidiaries that owns a direct or indirect interest in an eligible real property asset are guarantors under the Amended Credit Facility. The Company is subject to financial covenants under the Amended Credit Facility, including maintaining: a limitation on total consolidated leverage of not more than 60% of the Company’s total consolidated assets with a step up on two non-consecutive occasions to 65%, at the Operating Partnership’s election, for two consecutive quarters each following a material acquisition; a consolidated fixed charge coverage ratio of at least 1.50x; a consolidated tangible net worth of at least 75% of the Company’s tangible net worth at the date of the Amended Credit Facility plus 75% of future net equity proceeds; a consolidated secured leverage ratio of not more than 50% of the Company’s total consolidated assets; a secured recourse debt ratio of not more than 10% of the Company’s total consolidated assets; an unencumbered leverage ratio of not more than 60% of the Company’s consolidated unencumbered assets with a step up on two non-consecutive occasions to 65%, at the Operating Partnership’s election, for two consecutive quarters each following a material acquisition; and an unencumbered interest coverage ratio of at least 1.75x. The Amended Credit Facility restricts the Company’s ability to pay distributions to its stockholders under certain circumstances. However, the Company may make distributions to the extent necessary to maintain its qualification as a REIT under the Internal Revenue Code of 1986, as amended. The Amended Credit Facility contains certain additional covenants that, subject to exceptions, limit or restrict the Company’s incurrence of indebtedness and liens, disposition of assets, transactions with affiliates, mergers and fundamental changes, modification of organizational documents, changes to fiscal periods, making of investments, negative pledge clauses and lines of business and REIT qualification. The Company was in compliance with all financial covenants and was not in default of any other provisions under the Amended Credit Facility and the 2018 Credit Facility as of September 30, 2019 and December 31, 2018, respectively. Revolving Credit Facility The following table presents information about the Revolving Credit Facility and the 2018 Credit Facility in effect for the nine months ended September 30, 2019 and 2018: (in thousands) 2019 2018 Balance on January 1, $ 34,000 $ — Borrowings 278,000 — Repayments (157,000 ) — Balance on September 30, $ 155,000 $ — Total deferred financing costs, net, of $3.8 million and $3.0 million related to the 2018 Credit Facility and the Revolving Credit Facility were included within prepaid expenses and other assets, net on the Company’s consolidated balance sheets as of September 30, 2019 and December 31, 2018, respectively. The Company recorded $0.3 million and $0.2 million, respectively, to interest expense during the three months ended September 30, 2019 and 2018 related to amortization of these deferred financing costs The Company recorded $0.8 million and $0.3 million, respectively, to interest expense during the nine months ended September 30, 2019 and 2018, related to amortization of these deferred financing costs Additionally, t he Company recorded $1.1 million and $0.2 million of interest expense on borrowings and unused facility fees during the three months ended September 30, 2019 and 2018, respectively. The Company recorded interest expense on borrowings and unused facility fees of $2.1 million and $0.2 million during the nine months ended September 30, 2019 and 2018, respectively. The weighted average interest rate in effect on the Company’s borrowings under the Revolving Credit Facility and the 2018 Credit Facility as of September 30, 2019 and December 31, 2018 was 3.31% and 5.95%, respectively. As of September 30, 2019 and December 31, 2018, the Company had $245.0 million and $266.0 million of unused borrowing capacity related to the Revolving Credit Facility and the 2018 Credit Facility, respectively. Unsecured Term Loan On May 14, 2019, the Company borrowed the entire $200.0 million available under its variable-rate Term Loan Facility and used the entire proceeds to repurchase, in part, notes previously issued under its Master Trust Funding Program. See Note 6—Secured Borrowings for additional information. Total deferred financing costs, net, of $0.9 million related to the Term Loan Facility are included as a component of unsecured term loan, net of deferred financing costs on the Company’s consolidated balance sheets as of September 30, 2019. The Company recorded approximately $47,000 and $0.1 million, respectively, to interest expense during the three and nine months ended September 30, 2019 related to the amortization of these fees and direct costs of the Term Loan Facility. During the three and nine months ended September 30, 2019, the Company recorded $1.8 million and $2.8 million of cash interest expense, respectively, The variable interest rate in effect on the Company’s borrowings under the Term Loan Facility as of September 30, 2019 was 3.40%, and the Company fixed the interest rate on this variable-rate debt at 3.26% through the use of interest rate swap agreements. . |
Derivative and Hedging Activiti
Derivative and Hedging Activities | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative and Hedging Activities | 5. Derivative and Hedging Activities The Company does not enter into derivative financial instruments for speculative or trading purposes. The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish these objectives, the Company uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. These derivatives are considered cash flow hedges and are recorded on a gross basis at fair value. Subsequent to the adoption of ASU 2017-12, assessments of hedge effectiveness are performed quarterly using either a qualitative or quantitative approach. The Company recognizes the entire change in the fair value in accumulated other comprehensive income (loss) and the change is reflected as derivative changes in fair value in the supplemental disclosures of non-cash financing activities in the consolidated statement of cash flows. The amounts recorded in accumulated other comprehensive income (loss) will subsequently be reclassified to interest expense as interest payments are made on the Company’s borrowings under its Term Loan Facility. During the next twelve months, the Company estimates that $0.8 million will be reclassified from other comprehensive income as an increase to interest expense. The Company does not have netting arrangements related to its derivatives. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which the Company and its affiliates may also have other financial relationships. The Company does not anticipate that any of the counterparties will fail to meet their obligations. As of September 30, 2019, there were no events of default related to the interest rate swaps. The following table summarizes the notional amount at inception and fair value of these instruments on the Company's balance sheet as of September 30, 2019 (dollar amounts in thousands). Derivatives Designated as Hedging Instruments Fixed Rate Paid by Company Variable Rate Paid by Bank Effective Date Maturity Date Notional Value (1) Fair Value of Asset/(Liability) (2) Interest Rate Swap 2.06% 1 month LIBOR 5/14/2019 4/12/2024 $ 100,000 $ (2,985 ) Interest Rate Swap 2.06% 1 month LIBOR 5/14/2019 4/12/2024 50,000 (1,493 ) Interest Rate Swap 2.07% 1 month LIBOR 5/14/2019 4/12/2024 50,000 (1,499 ) $ 200,000 $ (5,977 ) (1) Notional value indicates the extent of the Company’s involvement in these instruments, but does not represent exposure to credit, interest rate or market risks. (2) Derivatives in a liability position are included within accrued liabilities and other payables in the Company’s consolidated balance sheets. During the three and nine months ended September 30, 2019, the Company recorded a loss on the change in the fair value of its interest rate swaps of $0.1 million and $0.2 million, which is included in interest expense in the Company’s consolidated statements of operations. The Company has agreements with each of its derivative counterparties that contain a provision where if the Company either defaults or is capable of being declared in default on any of its indebtedness, then the Company could also be declared in default on its derivative obligations. As of September 30, 2019, the fair value of derivatives in a net liability position including accrued interest but excluding any adjustment for nonperformance risk related to these agreements was $6.1 million. As of September 30, 2019, the Company had not posted any collateral related to these agreements and was not in breach of any provisions of such agreements. If the Company had breached any of these provisions, it could have been required to settle its obligations under the agreements at their aggregate termination value of $6.1 million as of September 30, 2019. |
Secured Borrowings
Secured Borrowings | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Secured Borrowings | 6. Secured Borrowings In the normal course of business, the Company transfers financial assets in various transactions with Special Purpose Entities (“SPE”) determined to be VIEs, which primarily consist of securitization trusts established for a limited purpose (the “Master Trust Funding Program”). These SPEs are formed for the purpose of securitization transactions in which the Company transfers assets to an SPE, which then issues to investors various forms of debt obligations supported by those assets. In these securitization transactions, the Company typically receives cash from the SPE as proceeds for the transferred assets and retains the rights and obligations to service the transferred assets in accordance with servicing guidelines. All debt obligations issued from the SPEs are non-recourse to the Company. In accordance with the accounting guidance for asset transfers, the Company considers any ongoing involvement with transferred assets in determining whether the assets can be derecognized from the balance sheets. For transactions that do not meet the requirements for derecognition and remain on the consolidated balance sheets, the transferred assets may not be pledged or exchanged by the Company. The Company evaluates its interest in certain entities to determine if these entities meet the definition of a VIE and whether the Company is the primary beneficiary and, therefore, should consolidate the entity based on the variable interests it held both at inception and when there was a change in circumstances that required a reconsideration. The Company has determined that the SPEs created in connection with its Master Trust Funding Program should be consolidated as the Company is the primary beneficiary of each of these entities. In December 2016, the Company issued its first series of notes under the Master Trust Funding Program, consisting of $263.5 million of Class A Notes and $17.3 million of Class B Notes (together, the “Series 2016-1 Notes”). These notes were issued to an affiliate of Eldridge through underwriting agents. The Series 2016-1 Notes were issued by two SPEs formed to hold assets and issue the secured borrowings associated with the securitization. In July 2017, the Company issued its second series of notes under the Master Trust Funding Program, consisting of $232.4 million of Class A Notes and $15.7 million of Class B Notes (together, the “Series 2017-1 Notes”). Of these notes, $75.1 million of the Class A Notes and all of the Class B Notes were issued to an affiliate of Eldridge through underwriting agents. The Series 2017-1 Notes were issued by three SPEs formed to hold assets and issue the secured borrowings associated with the securitization. Tenant rentals received on assets transferred to SPEs under the Master Trust Funding Program are sent to the trustee and used to pay monthly principal and interest payments. The Series 2016-1 Notes mature in November 2046, but the terms of the Class A Notes require principal to be paid monthly through November 2021, with a balloon repayment at that time, and the terms of the Class B Notes require no monthly principal payments but require the full principal balance to be paid in November 2021. If the Company does not meet these repayment schedules, the base interest rates on the notes increase by the greater of (i) 5.00% and (ii) the amount by which the sum of the following exceeds the base interest rates on the notes: (a) the yield to maturity of 10-year U.S. treasury securities in November 2021, plus (b) 5.00%, plus (c) 2.73% for the Series A Notes or 3.70% for the Class B Notes. Additionally, in this event, the full amount of any tenant rental payments received on the assets transferred to the securitization would be used to repay principal. The Series 2016-1 Notes may be voluntarily prepaid, in whole or in part, at any time on or after the date that is 24 months prior to the anticipated repayment date in November 2021 without the payment of a make whole amount. Voluntary prepayments may be made before 24 months prior to the anticipated repayment date but will be subject to the payment of a make whole amount. The Series 2017-1 Notes mature in June 2047, but the terms of the Class A Notes require principal to be paid monthly through June 2024, with a balloon repayment at that time, and the terms of the Class B Notes require no monthly principal payments but require the full principal balance to be paid in June 2024. The Series 2017-1 Notes contain similar interest rate escalation provisions as detailed above for Series 2016-1 Notes if these repayment schedules are not met. The Series 2017-1 Notes may be voluntarily prepaid, in whole or in part, at any time on or after the date that is 31 months prior to the anticipated repayment date in June 2024 without the payment of a make whole amount. Voluntary prepayments may be made before 31 months prior to the anticipated repayment date but will be subject to the payment of a make whole amount. In May 2019, the Company repurchased a portion of its Class A Series 2016-1 Notes with a face value of $200 million for $201.4 million from an affiliate of Eldridge. The repurchase was accounted for as a debt extinguishment and accordingly, the Company recorded a loss on extinguishment of $4.4 million, including the write-off of unamortized deferred financing charges. As of September 30, 2019 and December 31, 2018, the Company had issued notes with $509.2 million and $515.1 million, respectively, of combined gross principal through its Master Trust Funding Program and, as of September 30, 2019, had $310.6 million of combined net principal outstanding on these notes after giving effect to the Company’s repurchase of its Class A Series 2016-1 Notes in May 2019. Total deferred financing costs, net, of $4.9 million and $9.0 million related to the Master Trust Funding Program were included within secured borrowings, net of deferred financing costs on the Company’s consolidated balance sheets as of September 30, 2019 and December 31, 2018, respectively. The Company recorded $0.3 million and $1.3 million to interest expense during the three and nine months ended September 30, 2019, related to amortization of these costs he Company recorded $0.6 million and $1.7 million to interest expense during the three and nine months ended September 30, 2018, related to amortization of these costs During the three months ended September 30, 2019 and 2018, the Company recorded $3.8 million and $5.6 million, respectively, of interest expense on borrowings under the Master Trust Funding Program. During the nine months ended September 30, 2019 and 2018, the Company recorded $13.3 million and $16.9 million, respectively, of interest expense on borrowings under the Master Trust Funding Program. Interest on the Company’s secured borrowings issued under the Master Trust Funding Program bear interest at a weighted average interest rate of 4.28% as of September 30, 2019, after giving effect to the repurchase of Class A Series 2016-1 Notes in May 2019. The following table summarizes the scheduled principal payments on the Company’s secured borrowings as of September 30, 2019, net of the scheduled principal receipts on the repurchased Class A Series 2016-1 Notes: (in thousands) Future Principal Payments October 1, 2019 - December 31, 2019 $ 1,175 2020 4,844 2021 73,419 2022 4,292 2023 4,512 Thereafter 222,329 Total $ 310,571 The Company was not in default of any provisions under the Master Trust Funding Program as of September 30, 2019 or December 31, 2018. |
Notes Payable to Related Partie
Notes Payable to Related Parties | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Notes Payable to Related Parties | 7. Notes Payable to Related Parties Until the completion of the IPO, the Company had a secured warehouse line of credit with an affiliate of Eldridge through which it issued short-term notes (the “Warehouse Notes”) and used the proceeds to acquire investments in real estate. The Warehouse Notes accrued interest at a rate equal to LIBOR plus a spread of between 2.14% and 2.76% and matured within one year of the date of issuance. During the nine months ended September 30, 2018, the Company issued 20 Warehouse Notes for a combined $154.0 million. On January 31, 2018, the Company made principal payments on the Warehouse Notes of $50.0 million, repaying three of the Warehouse Notes in full and one of the Warehouse notes in part, prior to maturity. On June 25, 2018, the Company used a portion of the net proceeds from the IPO and the Concurrent Private Placement to repay all 36 of the outstanding Warehouse Notes, with an aggregate outstanding principal amount of $334.0 million, in full, prior to maturity, and had no amounts outstanding related to the Warehouse Notes following completion of the IPO. The Company had no amounts outstanding related to the Warehouse Notes as of December 31, 2018 and there was no activity in Warehouse Notes balances during the three and nine months ended September 30, 2019. During the nine months ended September 30, 2018, the Company recorded $4.6 million of interest expense related to the Warehouse Notes. No interest expense related to the Warehouse Notes was incurred during the three months ended September 30, 2018 and the three and nine months ended September 30, 2019. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Equity | 8. Equity Stockholders’ Equity On June 25, 2018, EPRT Inc. completed the IPO and issued 32,500,000 shares of its common stock at an initial public offering price of $14.00 per share. Concurrently with the completion of the IPO, EPRT Inc. completed the Concurrent Private Placement and issued 7,785,611 shares of its common stock and 1,142,960 OP Units at a price per share/unit of $14.00 to an affiliate of Eldridge. The issuance and sale of the shares and OP Units in the Concurrent Private Placement were made pursuant to private placement purchase agreements and there were no underwriting discounts or commissions associated with the sales. The OP Units issued to an affiliate of Eldridge were presented as a non-controlling interest in the Company’s consolidated financial statements through the completion of the Secondary Offering. See Note 9—Non-controlling Interests and below for additional information. As part of the IPO, the underwriters of the IPO were granted an option, exercisable within 30 days from June 20, 2018, to purchase up to an additional 4,875,000 shares of EPRT Inc.’s common stock at the IPO price of $14.00 per share, less underwriting discounts and commissions. On July 20, 2018, the underwriters of the IPO exercised this option in part, and on July 24, 2018, the Company issued an additional 2,772,191 shares of common stock. The net proceeds to EPRT Inc. from the IPO (including the purchase of additional shares pursuant to the underwriters’ option) and the Concurrent Private Placement, after deducting underwriting discounts and commissions and other expenses, were $583.7 million. On June 25, 2018, EPRT Inc. issued 691,290 shares of restricted On March 18, 2019, EPRT Inc. completed the Follow-On Offering and issued 14,030,000 shares of its common stock, including 1,830,000 shares of common stock purchased by the underwriters pursuant to an option to purchase additional shares, at an offering price of $17.50 per share. N et proceeds from the Follow-On Offering, after deducting underwriting discounts and commissions and other expenses, were $234.6 million On July 22, 2019, the Selling Stockholders, affiliates of Eldridge, completed the Secondary Offering of 26,288,316 shares of common stock, including 3,428,910 shares related to an option to purchase additional shares. Prior to completion of the Secondary Offering, the Selling Stockholders exchanged 18,502,705 OP Units of the Operating Partnership for a like number of shares of the Company’s common stock. At the Market Program In August 2019, the Company established the ATM Program pursuant to which it is authorized to sell shares of its common stock from time to time having an aggregate gross sales price of up to $200 million. During the three and nine months ended September 30, 2019 N three and nine months ended September 30, 2019 Dividends on Common Stock During the , the Company’s board of directors declared the following quarterly cash dividends on common stock (dollars in thousands, except per share data): Date Declared Record Date Date Paid Dividend per Share of Common Stock Total Dividend September 6, 2019 September 30, 2019 October 15, 2019 $ 0.22 $ 17,531 June 5, 2019 June 28, 2019 July 15, 2019 $ 0.22 $ 12,725 March 8, 2019 March 29, 2019 April 16, 2019 $ 0.21 $ 12,143 Members’ Equity EPRT LLC was capitalized by the Parent through direct and indirect capital contributions. During the period from March 30, 2016 (commencement of operations) to December 31, 2016, the Parent made direct capital contributions of $288.6 million and made indirect capital contributions of $163.1 million. In January 2017, the Parent made additional indirect capital contributions of $17.3 million. In these indirect capital contributions, the Parent made direct cash payments to sellers of real estate investments acquired by EPRT LLC. On January 31, 2017, in exchange for Class A units of EPRT LLC, Stonebriar Holdings made a direct equity contribution of $80.0 million and certain members of EPRT Management and certain members of the EPRT LLC’s board of managers made direct equity contributions of $3.7 million. Concurrently, EPRT LLC issued Class C units to the Parent in exchange for the Parent’s retention of an equity investment in EPRT LLC of $91.5 million. The Class A and Class C units were issued at $1,000 per unit and both classes contained liquidation preferences equal to the per unit value of $1,000 plus 8% per annum compounded quarterly. Additionally, on January 31, 2017, EPRT LLC approved and issued unvested Class B units to members of EPRT Management and a member of EPRT LLC’s board of managers and approved and issued unvested Class D units to members of EPRT LLC’s board of managers and external unitholders. See Note 10—Equity Based Compensation for additional information. Pursuant to the EPRT LLC Operating Agreement, distributions to unitholders were to be made in the following order and priority: • First, to the holders of Class A and Class C units until each holder of these units has first received an amount equal to each class’ yield, as defined in the EPRT LLC Operating Agreement, and then until each holder of these units has received an amount equal to each class’ aggregate unreturned class contributions; • Next, to the holders of Class B and Class D units in an aggregate amount based on a return threshold defined in the EPRT LLC Operating Agreement for each class of units; • Then, to the holders of Class B and Class D units in an aggregate amount equal to each class’ unit percentage of distributions, as defined in the EPRT LLC Operating Agreement; and • Lastly, any remaining amounts to the holders of Class A and Class C units. Pursuant to the EPRT LLC Operating Agreement, EPRT LLC’s net income or loss was allocated to the holders of the Class A, B, C and D units in a similar manner as the distribution allocation outlined above. On December 31, 2017, EPRT LLC completed the EPRT LLC Reorganization and the Parent, Stonebriar Holdings, EPRT Management and the holders of Class B and Class D units contributed all of their interests in EPRT LLC to EPRT Holdings, in exchange for interests in EPRT Holdings with the same rights as the interests they held in EPRT LLC. As of such date, EPRT LLC became a wholly owned subsidiary of EPRT Holdings. Additionally, EPRT Holdings issued a new grant of 500 unvested Class B units to a member of EPRT Management on the same date. On January 31, 2018, Stonebriar Holdings LLC made a $50.0 million direct equity contribution to EPRT Holdings. EPRT Holdings used these proceeds to repay $50.0 million of outstanding principal on the Warehouse Notes. As part of the Formation Transactions, EPRT LLC converted from a Delaware LLC into a Delaware limited partnership, changed its name to Essential Properties, L.P. and became the Operating Partnership. In connection with EPRT LLC’s conversion into a Delaware limited partnership, EPRT Holdings interest in EPRT LLC was converted into 17,913,592 OP Units. The OP Units issued to EPRT Holdings were presented as a non-controlling interest in the Company’s consolidated financial statements through the completion of the Secondary Offering in July 2019. See Note 9—Non-controlling Interests for additional information. |
Non-controlling Interests
Non-controlling Interests | 9 Months Ended |
Sep. 30, 2019 | |
Noncontrolling Interest [Abstract] | |
Non-controlling Interests | 9. Non-controlling Interests Essential Properties OP G.P., LLC, a wholly owned subsidiary of the Company, is the sole general partner of the Operating Partnership. The Company contributed the net proceeds from issuing shares of common stock in the IPO, the Concurrent Private Placement of common stock to Eldridge, the Follow-On Offering and the ATM Program to the Operating Partnership in exchange for a number of OP Units equal to the number of shares of common stock issued in each transaction. Prior to completion of the Secondary Offering, the Selling Stockholders exchanged 18,502,705 OP Units of the Operating Partnership for a like number of shares of the Company’s common stock. Concurrently, EPRT Holdings, one of the Selling Stockholders, distributed the remaining 553,847 OP Units it held to former members of EPRT Holdings (the “Non-controlling OP Unit Holders”). The Selling Stockholders thereafter sold all of the shares of common stock that they owned through the Secondary Offering and accordingly no longer owned shares of the Company’s common stock or held OP Units following the completion of the Secondary Offering. As of September 30, 2019, the Company held 79,672,970 OP Units, representing a 98.3% interest in the Operating Partnership. As of the same date, the Non-controlling OP Unit Holders held 553,847 OP Units in the aggregate, representing a 0.7% interest in the Operating Partnership. The OP Units held by EPRT Holdings and Eldridge prior to the completion of the Secondary Offering and the OP Units held by the Non-controlling OP Unit Holders are presented as non-controlling interests in the Company’s consolidated financial statements. A holder of OP Units has the right to distributions per unit equal to dividends per share paid on the Company’s common stock and has the right to redeem OP Units for cash or, at the Company’s election, shares of the Company's common stock on a one-for-one basis, provided, however, that such OP Units must have been outstanding for at least one year. During the three and nine months ended September 30, 2019, the Company declared total cash dividends of $0.22 and $0.65 per share of common stock, respectively. Distributions to OP Unit holders were declared and paid concurrently with the Company’s cash dividends to common stockholders. |
Equity Based Compensation
Equity Based Compensation | 9 Months Ended |
Sep. 30, 2019 | |
Disclosure Of Compensation Related Costs Equity Based Payments [Abstract] | |
Equity Based Compensation | 10. Equity Based Compensation 2018 Incentive Award Plan Effective immediately prior to the closing of the IPO, the Company adopted the Equity Incentive Plan, which provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, other stock awards, performance awards and LTIP units. Officers, employees, non-employee directors, consultants, independent contractors and agents who provide services to the Company or to any subsidiary of the Company are eligible to receive such awards. A maximum of 3,550,000 shares may be issued under the Equity Incentive Plan, subject to certain conditions. On June 22, 2018, the Company registered 3,550,000 shares of common stock, reserved for issuance under the Equity Incentive Plan, pursuant to a registration statement on Form S-8 (File No. 333-225837), filed with the SEC under the Securities Act. Restricted Stock Awards On June 25, 2018, an aggregate of 691,290 shares of unvested restricted common stock were issued to the Company’s directors, executive officers and other employees under the Equity Incentive Plan. These awards vest over periods ranging from one to three years from the date of grant, subject to the individual recipient’s continued provision of service to the Company through the applicable vesting dates. In January 2019, an aggregate of 46,368 shares of unvested restricted common stock were issued to the Company’s executive officers, other employees and an external consultant under the Equity Incentive Plan. These awards vest over periods ranging from one to four years from the date of grant, subject to the individual recipient’s continued provision of service to the Company through the applicable vesting dates. The Company estimates the grant date fair value of the unvested restricted common stock awards granted under the Equity Incentive Plan using the average market price of the Company’s common stock on the date of grant. The following table presents information about the Company’s restricted stock awards for the periods presented: Three months ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Compensation cost recognized in general and administrative expense $ 838 $ 823 $ 2,584 $ 869 Dividends declared and charged directly to distributions in excess of cumulative earnings 108 155 373 155 Fair value of shares vested during the period 60 — 3,354 — The following table presents information about the Company’s restricted stock awards as of the dates presented: (Dollars in thousands) September 30, 2019 December 31, 2018 Total unrecognized compensation cost $ 5,836 $ 7,764 Weighted average period over which compensation cost will be recognized (in years) 1.9 2.5 Restricted Share Units In January 2019 of the Company’s board of directors Company’s executive officers under the Equity Incentive Plan Of these awards, 75% are awards of nonvested share units for which vesting percentages and the ultimate number of units vesting will be calculated based on the total shareholder return (“TSR”) of the Company's common stock as compared to the TSR of 11 peer companies. The payout schedule can produce vesting percentages ranging from 0% to 250%. TSR will be calculated based upon the average closing price for the 20-trading day period ending December 31, 2021, divided by the average closing price for the 20-trading day period ended January 1, 2019. The target number of units is based on achieving a TSR equal to the 50th percentile of the peer group. The Company recorded expense on these TSR RSUs based on achieving the target. The grant date fair value of the TSR RSUs was measured using a Monte Carlo simulation model based on the following assumptions: Volatility 18 % Risk free rate 2.57 % The remaining 25% of these performance-based RSUs vest based on the Compensation Committee’s subjective evaluation of the individual recipient’s achievement of certain strategic objectives. As of September 30, 2019, t he Compensation Committee had not identified specific performance targets relating to the . As such, these awards do not have either a service inception or a grant date for GAAP accounting purposes and the Company recorded no compensation cost with respect to this portion of the RSUs during the three and nine months ended September 30, 2019. In June 2019, the Compensation Committee of the Company’s board of directors approved a grant of 11,500 RSUs to the Company’s independent directors. These awards vest in full on the earlier of one year from the grant date or the first annual meeting of stockholders that occurs after the grant date, subject to the individual recipient’s continued provision of service to the Company through the applicable vesting date. The Company estimated the grant date fair value of these RSUs using the average market price of the Company’s common stock on the date of grant. The following table presents information about the Company’s RSUs for the periods presented: Three months ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Compensation cost recognized in general and administrative expense $ 212 $ — $ 502 $ — Dividend equivalents declared and charged directly to distributions in excess of cumulative earnings 2 — 5 — Fair value of units vested during the period — — — — The following table presents information about the Company’s RSUs as of the dates presented: (Dollars in thousands) September 30, 2019 December 31, 2018 Total unrecognized compensation cost $ 1,796 $ — Weighted average period over which compensation cost will be recognized (in years) 2.6 — The following table presents information about the Company’s restricted stock award and RSU activity during the nine months ended September 30, 2019 and 2018: Restricted Stock Awards Restricted Share Units Shares Weighted Average Grant Date Fair Value Units Weighted Average Grant Date Fair Value Unvested, January 1, 2018 — $ — — $ — Granted 691,290 13.68 — — Vested — — — — Forfeited — — — — Unvested, September 30, 2018 691,290 $ 13.68 — $ — Unvested, January 1, 2019 691,290 $ 13.68 — $ — Granted 46,368 14.12 100,814 22.80 Vested (244,957 ) 13.69 — — Forfeited — — — — Unvested, September 30, 2019 492,701 $ 13.72 100,814 $ 22.80 Unit Based Compensation On January 31, 2017, EPRT LLC approved the issuance of Class B and Class D units and issued 8,050 unvested Class B units to members of EPRT Management and a member of EPRT LLC’s board of managers and issued 3,000 unvested Class D units to members of EPRT LLC’s board of managers and external unitholders. The Class B and Class D units vest in five equal installments that began on March 30, 2017 and will continue on each anniversary thereof through March 30, 2021. The holders of vested Class B units can put the Class B units beginning on March 30, 2024. On December 31, 2017, in the EPRT LLC Reorganization, the holders of Class B and Class D units contributed all of their interests in EPRT LLC to EPRT Holdings in exchange for interests in EPRT Holdings with the same rights as the interests they held in EPRT LLC. The EPRT LLC units were exchanged on a one-for-one basis for equivalent units in EPRT Holdings with the same vesting conditions, distribution rights, priority and income allocation rights, among others. Additionally, EPRT Holdings issued a new grant of 500 unvested Class B units to a member of EPRT Management on the same date. The Class B units granted on December 31, 2017 vest in five equal installments that began on May 1, 2018 and will continue on each anniversary thereof through May 1, 2022 and have similar put rights as the Class B units granted on January 31, 2017. Following the completion of the Formation Transactions, the Class B and Class D unitholders continue to hold vested and unvested interests in EPRT Holdings and, indirectly, the OP Units held by EPRT Holdings. On July 22, 2019, in conjunction with the completion of the Secondary Offering, 3,520 previously unvested Class B units and 1,200 previously unvested Class D units in EPRT Holdings automatically vested in accordance with the terms of the grant agreements, which represented all of the remaining outstanding unvested Class B and Class D units. Due to this accelerated vesting, the Company recorded all remaining unrecognized compensation cost on the Class B and Class D units to general and administrative expenses in its consolidated statements of operations during the three months ended September 30, 2019 The following table presents information about the Class B and Class D unit activity during the nine months ended September 30, 2019 and 2018: Class B Units Class D Units Total Unvested, January 1, 2018 6,940 2,400 9,340 Granted — — — Vested (1,710 ) (600 ) (2,310 ) Forfeited — — — Unvested, September 30, 2018 5,230 1,800 7,030 Unvested, January 1, 2019 5,230 1,800 7,030 Granted — — — Vested (5,230 ) (1,800 ) (7,030 ) Forfeited — — — Unvested, September 30, 2019 — — — The Company estimated the grant date fair value of the unvested Class B and Class D awards granted to employees on January 31, 2017 and December 31, 2017 and the fair value of the Class D awards granted to non-employees as of June 30, 2018 using a Black-Scholes valuation model. Effective July 1, 2018, the Company adopted ASU 2018-07 (see Note 2—Summary of Significant Accounting Policies) and did not subsequently remeasure the value of the unvested Class D awards granted to non-employees after this date. The Company's assumptions for expected volatility were based on daily historical volatility data related to market trading of publicly traded companies that invest in similar types of real estate as the Company, plus an adjustment to account for differences in the Company’s leverage compared to the publicly traded companies. The risk-free interest rate assumptions were determined by using U.S. treasury rates of the same period as the expected vesting term of each award. The marketability discounts were calculated using a Finnerty Model. The Company determined that the grant date per unit fair value of the unvested Class B and Class D units granted on January 31, 2017 was $323.65 and $152.16, respectively, and the grant date per unit fair value of the unvested Class B units granted on December 31, 2017 was $1,280.35. As of July 1, 2018, the Company determined that the per unit fair value of the Class D units granted to non-employees on January 31, 2017 was $79.09. The following table presents information about the Class B and Class D units for the periods presented: Three months ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Compensation cost recognized in general and administrative expense $ 1,692 $ 233 $ 2,130 $ 529 Fair value of units vested during the period 1,565 — 2,283 822 The following table presents information about the Class B and Class D units as of the dates presented: Class B Units Class D Units (Dollars in thousands) September 30, 2019 December 31, 2018 September 30, 2019 December 31, 2018 Total unrecognized compensation cost $ — $ 1,899 $ — $ 231 Liability on units granted to non-employees $ — $ — $ — $ 33 Weighted average period over which compensation cost will be recognized (in years) — 2.3 — 2.3 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | 11. Leases As Lessor The Company’s investment properties are Under ASC 842, scheduled future minimum base rental payments due to be received under the remaining non-cancelable term of the operating leases in place as of September 30, 2019 were as follows: (in thousands) Future Minimum Base Rental Receipts October 1, 2019 - December 31, 2019 $ 33,305 2020 133,653 2021 134,862 2022 136,697 2023 137,628 Thereafter 1,568,816 Total $ 2,144,961 Under ASC 840, scheduled future minimum base rental payments due to be received under the remaining non-cancelable term of the operating leases in place as of December 31, 2018 were as follows: (in thousands) Future Minimum Base Rental Receipts 2019 105,827 2020 106,082 2021 106,743 2022 108,035 2023 105,924 Thereafter 1,150,158 Total $ 1,682,769 Since lease renewal periods are exercisable at the option of the lessee, the preceding tables present future minimum base rental payments to be received during the initial non-cancelable lease term only. In addition, the future minimum lease payments exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to performance thresholds and exclude increases in annual rent based on future changes in the Consumer Price Index, among other items. The fixed and variable components (in thousands) Three months ended September 30, 2019 Nine months ended September 30, 2019 Fixed lease revenues $ 34,758 $ 96,687 Variable lease revenues (1) 474 1,990 Total lease revenues (2) $ 35,232 $ 98,677 (1) Includes contingent rent based on a percentage of the tenant’s gross sales and costs paid by the Company for which it is reimbursed by its tenants. (2) Excludes the amortization and accretion of above- and below-market lease intangible assets and liabilities and lease incentives and the adjustment to rental revenue for tenant credit. As Lessee The Company has a number of ground leases, an office lease and other equipment leases which are classified as operating leases. On January 1, 2019, the Company recorded $4.8 million of right of use (“ROU”) assets and lease liabilities related to these operating leases. The Company’s ROU assets were reduced by $0.1 million of accrued rent expense reclassified from accrued liabilities and other payables and $1.2 million of acquired above-market lease liabilities, net, reclassified from intangible lease liabilities, net and increased by $0.1 million of acquired below-market lease assets, net, reclassified from intangible lease assets, net of accumulated depreciation and amortization and $0.2 million of prepaid lease payments. As of September 30, 2019, the Company’s ROU assets and lease liabilities were $3.3 million and $4.2 million, respectively. The discount rate applied to measure each ROU asset and lease liability is based on the Company’s incremental borrowing rate ("IBR"). The Company considers the general economic environment and its historical borrowing activity and factors in various financing and asset specific adjustments to ensure the IBR is appropriate to the intended use of the underlying lease. As the Company did not elect to apply hindsight, lease term assumptions determined under ASC 840 were carried forward and applied in calculating the lease liabilities recorded under ASC 842. Certain of the Company’s ground leases offer renewal options which it assesses against relevant economic factors to determine whether it is reasonably certain of exercising or not exercising the option. Lease payments associated with renewal periods that the Company is reasonably certain will be exercised, if any, are included in the measurement of the corresponding lease liability and ROU asset. The following table sets forth information related to the measurement of the Company’s lease liabilities as of September 30, 2019 : September 30, 2019 Weighted average remaining lease term (in years) 5.1 Weighted average discount rate 7.00% The Company recognizes rent expense on its ground leases as a component of property expenses and rent expense on its office lease and other equipment leases as a component of general and administrative expense on its consolidated statements of operations. At five of these ground leased properties, Company’s lease as lessor of the building directly the building lessee to pay rents due under the ground lease to the ground lessor; under ASC 840, such ground lease rents are presented on a net basis in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2018. Upon adoption of ASC 842 on January 1, 2019 (see Note 2—Summary of Significant Accounting Policies), these ground lease rents are no longer presented on a net basis and instead are reflected on a gross basis in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2019. The following table : (in thousands) Three months ended September 30, 2019 Nine months ended September 30, 2019 Fixed rent expense $ 347 $ 1,068 Variable rent expense — — Total rent expense $ 347 $ 1,068 During the three and nine months ended September 30, 2018, the Company recorded $0.1 million and $0.4 million of ground rent expense within property and recorded $0.1 million and $0.1 million, respectively, of rent expense related to its office and equipment leases within general and administrative expense in the Company’s consolidated statements of operations. As of September 30, 2019, under ASC 842, future lease payments due from the Company under the ground, office and equipment operating leases where the Company is directly responsible for payment and the future lease payments due under the ground operating leases where the Company’s tenants are directly responsible for payment over the next five years and thereafter were as follows: (in thousands) Office and Ground Leases to be Paid by the Company Ground Leases to be Paid Directly by the Company’s Tenants Total Future Minimum Base Rental Payments October 1, 2019 - December 31, 2019 $ 215 $ 81 $ 296 2020 763 328 1,091 2021 680 331 1,011 2022 669 327 996 2023 656 26 682 Thereafter 1,093 — 1,093 Total $ 4,076 $ 1,093 5,169 Present value discount (971 ) Lease liabilities $ 4,198 The Company has adopted the short-term lease policy election and accordingly, the table above excludes future minimum base cash rental payments by the Company or its tenants on ground leases that expire before December 31, 2019. The total of such future obligations is approximately $33,000. As of December future lease payments due from the Company under the ground, office and equipment operating leases where the Company is directly responsible for payment and the future lease payments due under the ground operating leases where the Company’s tenants are directly responsible for payment over the next five years and thereafter were as follows (in thousands) Office and Ground Leases to be Paid by the Company Ground Leases to be Paid Directly by the Company’s Tenants Total Future Minimum Base Rental Payments 2019 $ 893 $ 492 $ 1,385 2020 759 328 1,087 2021 680 331 1,011 2022 669 327 996 2023 656 26 682 Thereafter 1,093 — 1,093 Total $ 4,750 $ 1,504 $ 6,254 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 12. Commitments and Contingencies As of September 30, 2019, the Company has remaining future commitments, under mortgage notes, reimbursement obligations or similar arrangements, to fund Litigation and Regulatory Matters In the ordinary course of business, the Company may become subject to litigation, claims and regulatory matters. There are no material legal or regulatory proceedings pending or known to be contemplated against the Company or its properties. Environmental Matters In connection with the ownership of real estate, the Company may potentially be liable for costs and damages related to environmental matters. As of September 30, 2019, the Company had not been notified by any governmental authority of any non-compliance, liability or other claim, and is not aware of any other environmental condition that it believes will have a material adverse effect on the Company’s results of operations. Defined Contribution Retirement Plan The Company has a defined contribution retirement savings plan qualified under Section 401(a) of the Internal Revenue Code (the “401(k) Plan”). The 401(k) Plan is available to all of the Company’s full-time employees. The Company provides a matching contribution in cash equal to 100% of the first 3% of eligible compensation contributed by participants and 50% of the next 2% of eligible compensation contributed by participants, which vests immediately. During the three months ended September 30, 2019 and 2018, the Company made matching contributions of approximately $21,000 and approximately $14,000, respectively. During the nine months ended September 30, 2019 and 2018, the Company made matching contributions of $0.1 million. Employment Agreements The Company has employment agreements with its executive officers. These employment agreements have an initial term of four years, with automatic one-year extensions unless notice of non-renewal is provided by either party. These agreements provide for initial annual base salaries and an annual performance bonus. In the event an executive officer’s employment terminates under certain circumstances, the Company would be liable for any annual performance bonus awarded for the year prior to termination, to the extent unpaid, continued payments equal to 12 months of base salary, monthly reimbursement for 12 months of COBRA premiums, and under certain situations, a pro rata bonus for the year of termination. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 13. Fair Value Measurements GAAP establishes a hierarchy of valuation techniques based on the observability of inputs used in measuring financial instruments at fair value. GAAP establishes market-based or observable inputs as the preferred source of values, followed by valuation models using management assumptions in the absence of market inputs. The determination of where an asset or liability falls in the hierarchy requires significant judgment and considers factors specific to the asset or liability. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company evaluates its hierarchy disclosures regularly and, depending on various factors, it is possible that an asset or liability may be classified differently from period to period. However, the Company expects that changes in classifications between levels will be rare. In addition to the disclosures for assets and liabilities required to be measured at fair value at the balance sheet date, companies are required to disclose the estimated fair values of all financial instruments, even if they are not presented at their fair value on the consolidated balance sheet. The fair values of financial instruments are estimates based upon market conditions and perceived risks at September 30, 2019 and December 31, 2018. These estimates require management’s judgment and may not be indicative of the future fair values of the assets and liabilities. Financial assets and liabilities for which the carrying values approximate their fair values include cash and cash equivalents, restricted cash, accounts receivable included within prepaid expenses and other assets, net, dividend payable and accrued liabilities and other payables (excluding the Company’s lease liability recorded under ASC 842 and derivative financial instruments). Generally, these assets and liabilities are short term in duration and their carrying value approximates fair value on the consolidated balance sheets. The estimated fair values of the Company’s fixed‑rate loans receivable have been derived based on primarily unobservable market inputs such as interest rates and discounted cash flow analyses using estimates of the amount and timing of future cash flows, market rates and credit spreads. These measurements are classified as Level 3 within the fair value hierarchy. The Company believes the carrying value of its fixed-rate loans receivable approximates fair value. The estimated fair values of the Company’s borrowings under the 2018 Credit Facility and the Amended Credit Facility have been derived based on primarily unobservable market inputs such as interest rates and discounted cash flow analyses using estimates of the amount and timing of future cash flows, market rates and credit spreads. These measurements are classified as Level 3 within the fair value hierarchy. The Company believes the carrying value of its borrowings under the Amended Credit Facility as of September 30, 2019 and the 2018 Credit Facility as of December 31, 2018 approximate fair value. The estimated fair values of the Company’s secured borrowings under the Master Trust Funding Program have been derived based on primarily unobservable market inputs such as interest rates and discounted cash flow analyses using estimates of the amount and timing of future cash flows, market rates and credit spreads. These measurements are classified as Level 3 within the fair value hierarchy. As of September 30, 2019, the Company’s secured borrowings, net had an aggregate carrying value of $310.6 million (excluding net deferred financing costs of $4.9 million) and an estimated fair value of $321.2 million. As of December 31, 2018, the Company’s secured borrowings had an aggregate carrying value of $515.1 million (excluding net deferred financing costs of $9.0 million) and an estimated fair value of $520.6 million. The Company measures its derivative financial instruments at fair value on a recurring basis. The fair values of the Company’s derivative financial instruments were determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of the derivative financial instrument. This analysis reflected the contractual terms of the derivative, including the period to maturity, and used observable market-based inputs, including interest rate market data and implied volatilities in such interest rates. While it was determined that the majority of the inputs used to value the derivatives fall within Level 2 of the fair value hierarchy under authoritative accounting guidance, the credit valuation adjustments associated with the derivatives also utilized Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default. However, as of September 30, 2019, the significance of the impact of the credit valuation adjustments on the overall valuation of the derivative financial instruments was assessed and it was determined that these adjustments were not significant to the overall valuation of the derivative financial instruments. As a result, it was determined that the derivative financial instruments in their entirety should be classified in Level 2 of the fair value hierarchy. As of September 30, 2019, the Company estimated the fair value of its interest rate swap contracts The Company measures its real estate investments at fair value on a nonrecurring basis. The fair values of these real estate investments were determined using the following input levels as of the date presented: Net Carrying Fair Value Measurements Using Fair Value Hierarchy (in thousands) Value Fair Value Level 1 Level 2 Level 3 December 31, 2018 Non-financial assets: Long-lived assets $ 3,238 $ 3,238 $ — $ — $ 3,238 |
Related Party Disclosures
Related Party Disclosures | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | 14. Related-Party Transactions During the nine months ended September 30, 2019 and 2018, an affiliate of Eldridge provided certain treasury and information technology services to the Company. The Company incurred a de minimis amount of expense for these services during the three and nine months ended September 30, 2019 and 2018, which is included in general and administrative expense in the Company’s consolidated statements of operations. The costs for the services provided by the affiliate of Eldridge would likely be different if such services were provided by unrelated parties. During the nine months ended September 30, 2018, the Company issued and repaid short-term notes to an affiliate of Eldridge. See Note 7—Notes Payable to Related Parties for additional information. In May 2019, the Company repurchased a portion of its Class A Series 2016-1 Notes with a face value of $200 million for $201.4 million from an affiliate of Eldridge. See Note 6—Secured Borrowings for additional information. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | 15. Subsequent Events The Company has evaluated all events and transactions that occurred after September 30, 2019 through the filing of this Quarterly Report on Form 10-Q and determined that there have been no events that have occurred that would require adjustment to disclosures in the consolidated financial statements except as disclosed below and as disclosed elsewhere in these notes to the consolidated financial statements. At the Market Program The Company sold an additional 1,359,739 shares of its common stock under the ATM Program, at a weighted average price per share of $24.05, raising $32.7 million in gross proceeds. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Accounting | Basis of Accounting The accompanying unaudited consolidated financial statements of the Company were prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the rules and regulations of the SEC. In the opinion of management, all adjustments of a normal recurring nature necessary for a fair presentation have been included. The results of operations for the three and nine months ended September 30, 2019 and 2018 are not necessarily indicative of the results for the full year. These unaudited financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as filed with the SEC in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018. |
Reclassification | Reclassification Certain amounts previously reported in the consolidated financial statements have been reclassified in the accompanying consolidated financial statements to conform to the current period’s presentation of gain on dispositions of real estate, net on the consolidated statements of operations for the three and nine months ended September 30, 2019. The Company has presented gain on dispositions of real estate, net as a component of income from operations in order to present gains and losses on dispositions of properties in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (ASC) 360-10-45-5. This change in presentation was made for the prior periods as the SEC has eliminated Rule 3-15(a) of Regulation S-X, which previously had required the Company to present gains and losses on sale of properties outside of continuing operations in the Company’s consolidated statements of operations. Additionally, the Company changed the presentation of its consolidated statements of stockholders’/members’ equity for the nine months ended September 30, 2018, as the SEC extended the annual disclosure requirements for changes in stockholders’ equity in Rule 3-04 of Regulation S-X to interim periods, now requiring both the year-to-date information and subtotals for each interim period. Additionally, certain amounts previously reported in the consolidated statements of operations have been reclassified to conform to the current period’s presentation of rental revenue (due to the adoption of the new lease accounting standard, as discussed further below), interest income and income tax expense. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and subsidiaries in which the Company has a controlling financial interest. All intercompany accounts and transactions have been eliminated in consolidation. As of September 30, 2019 and December 31, 2018, the Company held a 98.3% and 69.7% ownership interest in the Operating Partnership and the consolidated financial statements include the financial statements of the Operating Partnership as of these dates. See Note 8—Equity for changes in the ownership interest in the Operating Partnership. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Real Estate Investments | Real Estate Investments Investments in real estate are carried at cost less accumulated depreciation and impairment losses. The cost of investments in real estate reflects their purchase price or development cost. The Company evaluates each acquisition transaction to determine whether the acquired asset meets the definition of a business. Under Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business The Company allocates the purchase price of acquired properties accounted for as asset acquisitions to tangible and identifiable intangible assets or liabilities based on their relative fair values. Tangible assets may include land, site improvements and buildings. Intangible assets may include the value of in-place leases and above- and below-market leases and other identifiable intangible assets or liabilities based on lease or property specific characteristics. The Company incurs various costs in the leasing and development of its properties. Amounts paid to tenants that incentivize them to extend or otherwise amend an existing lease or to sign a new lease agreement are capitalized to lease incentives on the Company’s consolidated balance sheets. Tenant improvements are capitalized to building and improvements within the Company’s consolidated balance sheets. Costs incurred which are directly related to properties under development, which include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs and real estate taxes and insurance, are capitalized during the period of development as construction in progress. After the determination is made to capitalize a cost, it is allocated to the specific component of a project that benefited. Determination of when a development project commences, and capitalization begins, and when a development project has reached substantial completion, and is available for occupancy and capitalization must cease, involves a degree of judgment. The fair value of the tangible assets of an acquired property with an in-place operating lease is determined by valuing the property as if it were vacant, and the “as-if-vacant” value is then allocated to the tangible assets based on the fair value of the tangible assets. The fair value of in-place leases is determined by considering estimates of carrying costs during the expected lease-up periods, current market conditions, as well as costs to execute similar leases based on the specific characteristics of each tenant’s lease. The Company estimates the cost to execute leases with terms similar to the remaining lease terms of the in-place leases, including leasing commissions, legal and other related expenses. Factors the Company considers in this analysis include an estimate of the carrying costs during the expected lease-up periods considering current market conditions and costs to execute similar leases. In estimating carrying costs, the Company includes real estate taxes, insurance and other operating expenses, and estimates of lost rentals at market rates during the expected lease-up periods, which primarily range from six to 12 months. The fair value of above- or below-market leases is recorded based on the net present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between the contractual amount to be paid pursuant to the in-place lease and the Company’s estimate of the fair market lease rate for the corresponding in-place lease, measured over the remaining non-cancelable term of the lease including any below-market fixed rate renewal options for below-market leases. In making estimates of fair values for purposes of allocating purchase price, the Company utilizes a number of sources, including real estate valuations prepared by independent valuation firms. The Company also considers information and other factors including market conditions, the industry that the tenant operates in, characteristics of the real estate (e.g., location, size, demographics, value and comparative rental rates), tenant credit profile and the importance of the location of the real estate to the operations of the tenant’s business. Additionally, the Company considers information obtained about each property as a result of its pre-acquisition due diligence, marketing and leasing activities in estimating the fair value of the tangible and intangible assets acquired. The Company uses the information obtained as a result of its pre-acquisition due diligence as part of its consideration of the accounting standard governing asset retirement obligations and, when necessary, will record an asset retirement obligation as part of the purchase price allocation. Real estate investments that are intended to be sold are designated as “held for sale” on the consolidated balance sheets at the lesser of carrying amount or fair value less estimated selling costs when they meet specific criteria to be presented as held for sale. Real estate investments are no longer depreciated when they are classified as held for sale. If the disposal, or intended disposal, of certain real estate investments represents a strategic shift that has had or will have a major effect on the Company’s operations and financial results, the operations of such real estate investments would be presented as discontinued operations in the consolidated statements of operations for all applicable periods. |
Depreciation and Amortization | Depreciation and Amortization Depreciation is computed using the straight-line method over the estimated useful lives of up to 40 years for buildings and 15 years for site improvements. During the three months ended September 30, 2019 and 2018, the Company recorded $9.4 million and $6.6 million, respectively, of depreciation on its real estate investments. During the nine months ended September 30, 2019 and 2018, the Company recorded $25.7 million and $17.6 million, respectively, of depreciation on its real estate investments. Lease incentives are amortized on a straight-line basis as a reduction of rental income over the remaining non-cancellable terms of the respective leases. If a tenant terminates its lease, the unamortized portion of the lease incentive is charged to rental revenue. Construction in progress is not depreciated until the development has reached substantial completion. Tenant improvements are depreciated over the non-cancellable term of the related lease or their estimated useful life, whichever is shorter. Capitalized above-market lease values are amortized on a straight-line basis as a reduction of rental revenue over the remaining non-cancellable terms of the respective leases. Capitalized below-market lease values are accreted on a straight-line basis as an increase to rental revenue over the remaining non-cancellable terms of the respective leases including any below-market fixed rate renewal option periods. Capitalized above-market ground lease values are accreted as a reduction of property expenses over the remaining terms of the respective leases. Capitalized below-market ground lease values are amortized as an increase to property expenses over the remaining terms of the respective leases and any expected below-market renewal option periods where renewal is considered probable. The value of in-place leases, exclusive of the value of above-market and below-market lease intangibles, is amortized to depreciation and amortization expense on a straight-line basis over the remaining periods of the respective leases. If a tenant terminates its lease, the unamortized portion of each intangible, including in-place lease values, is charged to depreciation and amortization expense, while above- and below-market lease adjustments are recorded within rental revenue in the consolidated statements of operations. |
Loans Receivable | Loans Receivable The Company holds its loans receivable for long-term investment. Loans receivable are carried at amortized cost, including related unamortized discounts or premiums, if any. The Company recognizes interest income on loans receivable using the effective-interest method applied on a loan-by-loan basis. Direct costs associated with originating loans are offset against any related fees received and the balance, along with any premium or discount, is deferred and amortized as an adjustment to interest income over the term of the related loan receivable using the effective-interest method. The Company periodically evaluates the collectability of its loans receivable, including accrued interest, by analyzing the underlying property‑level economics and trends, collateral value and quality and other relevant factors in determining the adequacy of its allowance for loan losses. A loan is determined to be impaired when, in management’s judgment based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Specific allowances for loan losses are provided for impaired loans on an individual loan basis in the amount by which the carrying value exceeds the estimated fair value of the underlying collateral less disposition costs. As of September 30, 2019 and December 31, 2018, the Company had no allowance for loan losses recorded in its consolidated financial statements. |
Direct Financing Lease Receivables | Direct Financing Lease Receivables Certain of the Company’s real estate investment transactions are accounted for as direct financing leases. The Company records the direct financing lease receivables at their net investment, determined as the aggregate minimum lease payments and the estimated non-guaranteed residual value of the leased property less unearned income. The unearned income is recognized over the term of the related lease so as to produce a constant rate of return on the net investment in the asset. The Company’s investment in direct financing lease receivables is reduced over the applicable lease term to its non-guaranteed residual value by the portion of rent allocated to the direct financing lease receivables. Subsequent to the adoption of ASC 842, Leases If and when an investment in direct financing lease receivables is identified for impairment evaluation, the Company will apply the guidance in both ASC 310, Receivables Leases |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets If circumstances indicate that the carrying value of a property may not be recoverable, the Company reviews the property for impairment. This review is based on an estimate of the future undiscounted cash flows, excluding interest charges, expected to result from the property’s use and eventual disposition. These estimates consider factors such as expected future operating income, market and other applicable trends and residual value, as well as the effects of leasing demand, competition and other factors. If impairment exists due to the inability to recover the carrying value of a property, an impairment loss is recorded to the extent that the carrying value exceeds the estimated fair value of the property for properties to be held and used. For properties held for sale, the impairment loss is the adjustment to fair value less estimated cost to dispose of the asset. Impairment assessments have a direct impact on the consolidated statements of operations because recording an impairment loss results in an immediate negative adjustment to the consolidated statements of operations. During the three months ended September 30, 2019, the Company recorded no provision for impairment of real estate and recorded a $0.8 million provision for impairment of real estate during the three months ended September 30, 2018. During the nine months ended September 30, 2019 and 2018, the Company recorded a provision for impairment of real estate of $1.9 million and $3.5 million, respectively. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents includes cash in the Company’s bank accounts. The Company considers all cash balances and highly liquid investments with original maturities of three months or less to be cash and cash equivalents. The Company deposits cash with high quality financial institutions. These deposits are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”) up to an insurance limit. As of September 30, 2019 and December 31, 2018, the Company had deposits of $23.4 million and $4.2 million, respectively, of which $23.2 million and $4.0 million, respectively, were in excess of the amount insured by the FDIC. Although the Company bears risk to amounts in excess of those insured by the FDIC, it does not anticipate any losses as a result. |
Restricted Cash | Restricted Cash Restricted cash primarily consists of cash held with the trustee for the Company’s Master Trust Funding Program (as defined in Note 6—Secured Borrowings). This restricted cash is used to make principal and interest payments on the Company’s secured borrowings, to pay trust expenses and to acquire future real estate investments which will be pledged as collateral under the Master Trust Funding Program. See Note 6—Secured Borrowings for further discussion. |
Adjustment to Rental Revenue for Tenant Credit/Allowance for Doubtful Accounts | Adjustment to Rental Revenue for Tenant Credit/Allowance for Doubtful Accounts The Company continually reviews receivables related to rent and unbilled rent receivables and determines collectability by taking into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. Prior to January 1, 2019, if the collectability of a receivable was in doubt, the accounts receivable and straight-line rent receivable balances were reduced by an allowance for doubtful accounts on the consolidated balance sheets or a direct write-off of the receivable was recorded in the consolidated statements of operations. The provision for doubtful accounts was included in property expenses in the Company’s consolidated statements of operations. If the accounts receivable balance or straight-line rent receivable balance was subsequently deemed to be uncollectible, such receivable amounts were written-off to the allowance for doubtful accounts. As of January 1, 2019, if the assessment of the collectability of substantially all payments due under a lease changes from probable to not probable, any difference between the rental revenue recognized to date and the lease payments that have been collected is recognized as a current period adjustment to rental revenue in the consolidated statements of operations. As of September 30, 2019 and December 31, 2018, the Company recorded an allowance for doubtful accounts of $0.1 million related to base rent receivable and recorded no allowance for doubtful accounts related to straight-line rent receivable. During the three months ended September 30, 2019, the Company recognized no adjustment to rental revenue and recognized an adjustment of approximately $25,000 to rental revenue during the nine months ended September 30, 2019. During the three and nine months ended September 30, 2018, the |
Deferred Financing Costs | Deferred Financing Costs Financing costs related to establishing the Company’s 2018 Credit Facility and Revolving Credit Facility (as defined below) were deferred and are being amortized as an increase to interest expense in the consolidated statements of operations over the term of the facility and are reported as a component of prepaid expenses and other assets, net on the consolidated balance sheets. Financing costs related to the issuance of the Company’s secured borrowings under the Master Trust Funding Program and Term Loan Facility (as defined below) were deferred and are being amortized as an increase to interest expense in the consolidated statements of operations over the term of the related debt instrument and are reported as a reduction of the related debt balance on the consolidated balance sheets. |
Derivative Instruments | Derivative Instruments In the normal course of business, the Company uses derivative financial instruments, which may include interest rate swaps, caps, options, floors and other interest rate derivative contracts, The Company records all derivatives on the consolidated balance sheets at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may also enter into derivative contracts that are intended to economically hedge certain risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. The accounting for subsequent changes in the fair value of these derivatives depends on whether each has been designed and qualifies for hedge accounting treatment. If a derivative is designated and qualifies for cash flow hedge accounting treatment, the change in the estimated fair value of the derivative is recorded in other comprehensive income (loss) in the consolidated statements of comprehensive income to the extent that it is effective. Any ineffective portion of a change in derivative fair value is immediately recorded in earnings. If the Company elects not to apply hedge accounting treatment (or for derivatives that do not qualify as hedges), any change in the fair value of these derivative instruments is recognized immediately in gains (losses) on derivative instruments in the consolidated statements of operations. |
Fair Value Measurement | Fair Value Measurement The Company estimates fair value of financial and non-financial assets and liabilities based on the framework established in fair value accounting guidance. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The hierarchy described below prioritizes inputs to the valuation techniques used in measuring the fair value of assets and liabilities. This hierarchy maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs to be used when available. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1—Quoted prices in active markets for identical assets and liabilities that the Company has the ability to access at the measurement date. Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability. Level 3—Unobservable inputs that reflect the Company’s own assumptions that market participants would use in the pricing of the asset or liability and are consequently not based on market activity, but rather through particular valuation techniques. |
Revenue Recognition | Revenue Recognition The Company’s rental revenue is primarily rent received from tenants. Rent from tenants is recorded in accordance with the terms of each lease on a straight-line basis over the non-cancellable initial term of the lease from the later of the date of the commencement of the lease or the date of acquisition of the property subject to the lease. Rental revenue recognition begins when the tenant controls the space and continues through the term of the related lease. Because substantially all of the leases provide for rental increases at specified intervals, the Company records a straight-line rent receivable and recognizes revenue on a straight-line basis through the expiration of the non-cancelable term of the lease. The Company takes into account whether the collectability of rents is reasonably assured in determining the amount of straight-line rent to record. Generally, the Company’s leases provide the tenant with one or more multi-year renewal options, subject to generally the same terms and conditions provided under the initial lease term, including rent increases. If economic incentives make it reasonably certain that an option period to extend the lease will be exercised, the Company will include these options in determining the non-cancelable term of the lease. The Company defers rental revenue related to lease payments received from tenants in advance of their due dates. These amounts are presented within accrued liabilities and other payables on the Company’s consolidated balance sheets. Certain properties in the Company’s investment portfolio are subject to leases that provide for contingent rent based on a percentage of the tenant’s gross sales. For these leases, the Company recognizes contingent rental revenue when the threshold upon which the contingent lease payment is based is actually reached. During the three months ended September 30, 2019 and 2018, the Company recorded contingent rent of $0.1 million and $0.2 million. During the nine months ended September 30, 2019 and 2018, the Company recorded contingent rent of $0.7 million and $0.9 million, respectively. |
Organizational Costs | Organizational Costs Costs related to the initial organization of the Company and its subsidiaries are expensed as they are incurred and are recorded within general and administrative expense in the Company’s consolidated statements of operations. |
Offering Costs | Offering Costs In connection with the IPO, the Follow-On Offering, and its ATM Program, the Company incurred legal, accounting and other offering-related costs. Such costs have been deducted from the gross proceeds of each of the IPO, Follow-On Offering and ATM Program. As of September 30, 2019 and December 31, 2018, the Company had capitalized a total of $47.6 million and $35.1 million, respectively, of such costs in the Company’s consolidated balance sheets. These costs are presented as a reduction of additional paid-in capital as of September 30, 2019 and December 31, 2018. Legal, accounting and other offering-related costs incurred in connection with the Secondary Offering were expensed as incurred and are recorded within general and administrative expense in the Company’s consolidated statements of operations. |
Gains and Losses on Dispositions of Real Estate | Gains and Losses on Dispositions of Real Estate On January 1, 2018, the Company adopted FASB ASU 2017-05, Other Income — Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets |
Income Taxes | Income Taxes EPRT Inc. elected and qualified to be taxed as a REIT under sections 856 through 860 of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2018. REITs are subject to a number of organizational and operational requirements, including a requirement that 90% of ordinary “REIT taxable income” (as determined without regard to the dividends paid deduction or net capital gains) be distributed. As a REIT, the Company will generally not be subject to U.S. federal income tax to the extent that it meets the organizational and operational requirements and its distributions equal or exceed REIT taxable income. For the period subsequent to the effective date of its REIT election, the Company continues to meet the organizational and operational requirements and expects distributions to exceed net taxable income. Accordingly, no provision has been made for U.S. federal income taxes. Even though the Company has elected and qualifies for taxation as a REIT, it may be subject to state and local income and franchise taxes, and to federal income and excise tax on its undistributed income. Franchise taxes and federal excise taxes on the Company’s undistributed income, if any, are included in general and administrative expenses on the accompanying consolidated statements of operations. Additionally, taxable income from non-REIT activities managed through the Company's taxable REIT subsidiary is subject to federal, state, and local taxes. The Company analyzes its tax filing positions in all of the U.S. federal, state and local tax jurisdictions where it is required to file income tax returns, as well as for all open tax years in such jurisdictions. The Company follows a two-step process to evaluate uncertain tax positions. Step one, recognition, occurs when an entity concludes that a tax position, based solely on its technical merits, is more-likely-than-not to be sustained upon examination. Step two, measurement, determines the amount of benefit that is more-likely-than-not to be realized upon settlement. Derecognition of a tax position that was previously recognized would occur when the Company subsequently determines that a tax position no longer meets the more-likely-than-not threshold of being sustained. The use of a valuation allowance as a substitute for derecognition of tax positions is prohibited. As of September 30, 2019 and December 31, 2018, the Company did not record any accruals for uncertain tax positions. The Company’s policy is to classify interest expense and penalties in general and administrative expense in the consolidated statements of operations. During the three and nine months ended September 30, 2019 and 2018, the Company did not record any interest or penalties, and there are no interest or penalties accrued at September 30, 2019 and December 31, 2018. The 2018, 2017 and 2016 taxable years remain open to examination by federal and state taxing jurisdictions to which the Company is subject. |
Equity Based Compensation | Equity-Based Compensation In 2019 and 2018, EPRT Inc. granted shares of restricted common stock and restricted share units (“RSUs”) to its directors, executive officers and other employees that vest over multiple periods, subject to the recipient’s continued service. In 2019, EPRT Inc. granted performance-based RSUs to its executive officers, the final number of which is determined based off of market and subjective performance conditions and which vest over a multi-year period, subject to the recipient’s continued service. In 2017, the Predecessor granted unit-based compensation awards to certain of its employees and managers, as well as non-employees, consisting of units that vest over a multi-year period, subject to the recipient’s continued service. The Company accounts for the restricted common stock, RSUs and unit-based compensation in accordance with ASC 718, Compensation – Stock Compensation, which requires that such compensation be recognized in the financial statements based on their estimated grant-date fair value. The value of such awards is recognized as compensation expense in general and administrative expenses in the accompanying consolidated statements of operations over the requisite service periods. The Company recognizes compensation expense for equity-based compensation using the straight-line method based on the terms of the individual grant. |
Variable Interest Entities | Variable Interest Entities The FASB provides guidance for determining whether an entity is a variable interest entity (a “VIE”). VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. A VIE is required to be consolidated by its primary beneficiary, which is the party that (i) has the power to control the activities that most significantly impact the VIE’s economic performance and (ii) has the obligation to absorb losses, or the right to receive benefits, of the VIE that could potentially be significant to the VIE. Following the completion of the Formation Transactions, the Company concluded that the Operating Partnership is a VIE of which the Company is the primary beneficiary, as the Company has the power to direct the activities that most significantly impact the economic performance of the Operating Partnership . Substantially all of the Company’s assets and liabilities are held by the Operating Partnership. The assets and liabilities of the Operating Partnership are consolidated and reported as assets and liabilities on the Company’s consolidated balance sheet as of September 30, 2019 and December 31, 2018. As of he Company concluded that an entity which it had provided a $5.7 million mortgage loan receivable was a VIE because the terms of the loan agreement limited the entity’s ability to absorb expected losses or the entity’s right to receive expected residual returns. However, the Company was not the primary beneficiary of the entity, because the Company did not have the power to direct the activities that most significantly impact the entity’s economic performance. As of the carrying amount of the Company’s loan receivable with this entity was $5.7 million, and the Company’s maximum exposure to loss in this entity is limited to the carrying amount of its investment. The Company had no liabilities associated with this investment as of . In March 2019 he Company had no loan receivable from this entity as of September 30, 2019. As of September 30, 2019 he Company concluded that five entities to which it had provided mortgage loans were VIEs because the entities’ equity is not sufficient to finance the activities without additional subordinated financial support. However, the Company was not the primary beneficiary of the entities, because the Company did not have the power to direct the activities that most significantly impact the entities’ economic performance. As of September 30, 2019 the carrying amount of the Company’s loans receivable with these entities was $30.7 million, and the Company’s maximum exposure to loss in these entities is limited to the carrying amount of its investment. The Company had no liabilities associated with these VIEs as of September 30, 2019. |
Reportable Segments | Reportable Segments ASC Topic 280, Segment Reporting, establishes standards for the manner in which enterprises report information about operating segments. Substantially all of the Company’s investments, at acquisition, are comprised of real estate owned that is leased to tenants on a long-term basis. Therefore, the Company aggregates these investments for reporting purposes and operates in one reportable segment. |
Net Income Per Common Share | Net Income per Share Net income per share has been computed pursuant to the guidance in the FASB ASC Topic 260, Earnings Per Share Diluted net income per share of common stock further considers the effect of potentially dilutive shares of common stock outstanding during the period, including the assumed vesting of restricted share units with a market-based or service-based vesting condition, where dilutive. The OP Units held by non-controlling interests represent potentially dilutive securities as the OP Units may be redeemed for cash or, at the Company’s election, exchanged for shares of the Company’s common stock on a one-for-one basis. The following is a reconciliation of the numerator and denominator used in the computation of basic and diluted net income per share (dollars in thousands): Three months ended September 30, Nine months ended September Period from June 25, 2018 to September (dollar amounts in thousands) 2019 2018 30, 2019 30, 2018 Numerator for basic and diluted earnings per share: Net income $ 14,106 $ 7,707 $ 33,399 $ 8,029 Less: net income attributable to non-controlling interests (861 ) (2,383 ) (6,076 ) (2,482 ) Less: net income allocated to unvested restricted common stock and RSUs (110 ) (155 ) (377 ) (155 ) Net income available for common stockholders: basic 13,135 5,169 26,946 5,392 Net income attributable to non-controlling interests 861 2,383 6,076 2,482 Net income available for common stockholders: diluted $ 13,996 $ 7,552 $ 33,022 $ 7,874 Denominator for basic and diluted earnings per share: Weighted average common shares outstanding 72,979,558 43,056,044 59,025,313 42,928,750 Less: weighted average number of shares of unvested restricted common stock (495,626 ) (691,290 ) (649,568 ) (691,290 ) Weighted average shares outstanding used in basic net income per share 72,483,932 42,364,754 58,375,745 42,237,460 Effects of dilutive securities: (1) OP Units 4,777,291 19,056,552 14,244,493 19,056,552 Unvested restricted common stock and RSUs 351,726 51,369 401,035 48,266 Weighted average shares outstanding used in diluted net income per share 77,612,949 61,472,675 73,021,273 61,342,278 (1) Assumes the most dilutive issuance of potentially issuable shares between the two-class and treasury stock method unless the result would be anti-dilutive. |
Recent Accounting Developments | Recent Accounting Developments In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ASU 2016-02”) to amend the accounting for leases. The new standard requires lessees to classify leases as either finance or operating leases based on certain criteria and record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months, regardless of their classification. The new standard requires lessors to account for leases using an approach that is substantially equivalent to the previous guidance for sales-type leases, direct financing leases and operating leases. The standard also eliminates current real estate-specific provisions and changes the guidance on sale-leaseback transactions, initial direct costs, lease modifications and lease executory costs for all entities. Certain changes to the guidance pertaining to sale-leaseback transactions may impact the Company. For example, the inclusion of a purchase option in the lease associated with a sale-leaseback transaction will now result in the lessor accounting for such transaction as a financing arrangement. ASU 2016-02 was effective for the Company on January 1, 2019 and, in accordance with the provisions of ASU 2018-11, Leases (Topic 842), Targeted Improvements, was adopted by the Company using the modified retrospective approach as of the beginning of the period of adoption. There was no impact to retained earnings at the time of adoption and, therefore, no cumulative-effect adjustment was recorded. At the time of adoption, both lessees and lessors are permitted to make an election to apply a package of practical expedients available for implementation under the standard. The Company applied this package of practical expedients and, as such, at the time of adoption did not reassess the classification of existing lease contracts, whether existing or expired contracts contain a lease or whether a portion of initial direct costs for existing leases should have been expensed. In addition, the Company adopted the practical expedient provided in ASU 2018-11 that allows lessors to not separate non-lease components from the related lease components. The Company made this determination as the timing and pattern of transfer for the lease and non-lease components associated with its leases are the same and the lease components, if accounted for separately, would be classified as operating leases in accordance with ASC 842. The accounting applied by a lessor is largely unchanged under ASU 2016-02; however, the standard requires that lessors expense, on an as-incurred basis, certain initial direct costs that are not incremental in obtaining a lease. Under the previous standards, certain of these costs were capitalizable. Although primarily a lessor, the Company is also a lessee under several ground lease arrangements and under its corporate office and office equipment leases. The Company completed its inventory and evaluation of these leases, calculated a right-of-use asset and a lease liability for the present value of the minimum lease payments and recognized an initial $4.8 million right-of-use asset and lease liability upon adoption. For a portion of the Company’s ground lease arrangements, the sublessees, or the Company’s tenants, are responsible for making payment directly to the ground lessors. Prior to the new standard such amounts were presented on a net basis; however, upon adoption of ASU 2016-02 the expense related to the ground lease obligations, along with the related sublease revenues, is presented on a gross basis in the consolidated statements of operations. ASU 2016-02 also requires additional disclosures within the notes accompanying the consolidated financial statements. Substantially all of the Company’s lease contracts (under which the Company is the lessor) are “triple-net” leases, which means that its tenants are responsible for making payments to third parties for operating expenses such as property taxes and insurance costs associated with the properties the Company leases to them. Under the previous lease accounting guidance, these payments were excluded from rental revenue. In December 2018, the FASB issued ASU 2018-20 Leases (Topic 842), Narrow-Scope Improvements for Lessors. This update requires the Company to exclude from variable lease payments, and therefore revenue and expense, costs paid by its tenants directly to third parties (a net presentation). Costs paid by the Company and reimbursed by its tenants are included in rental revenue and property expenses (a gross presentation) in the Company’s consolidated statements of operations. In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities (ASU 2017-12) In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement: Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”) In February 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments Financial Instruments - Credit Losses |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Reconciliation of Numerator and Denominator used in Computation of Basic and Diluted Net Income Per Share | The following is a reconciliation of the numerator and denominator used in the computation of basic and diluted net income per share (dollars in thousands): Three months ended September 30, Nine months ended September Period from June 25, 2018 to September (dollar amounts in thousands) 2019 2018 30, 2019 30, 2018 Numerator for basic and diluted earnings per share: Net income $ 14,106 $ 7,707 $ 33,399 $ 8,029 Less: net income attributable to non-controlling interests (861 ) (2,383 ) (6,076 ) (2,482 ) Less: net income allocated to unvested restricted common stock and RSUs (110 ) (155 ) (377 ) (155 ) Net income available for common stockholders: basic 13,135 5,169 26,946 5,392 Net income attributable to non-controlling interests 861 2,383 6,076 2,482 Net income available for common stockholders: diluted $ 13,996 $ 7,552 $ 33,022 $ 7,874 Denominator for basic and diluted earnings per share: Weighted average common shares outstanding 72,979,558 43,056,044 59,025,313 42,928,750 Less: weighted average number of shares of unvested restricted common stock (495,626 ) (691,290 ) (649,568 ) (691,290 ) Weighted average shares outstanding used in basic net income per share 72,483,932 42,364,754 58,375,745 42,237,460 Effects of dilutive securities: (1) OP Units 4,777,291 19,056,552 14,244,493 19,056,552 Unvested restricted common stock and RSUs 351,726 51,369 401,035 48,266 Weighted average shares outstanding used in diluted net income per share 77,612,949 61,472,675 73,021,273 61,342,278 (1) Assumes the most dilutive issuance of potentially issuable shares between the two-class and treasury stock method unless the result would be anti-dilutive. |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Investments [Abstract] | |
Schedule of Information about Acquisition Activity | The following table presents information about the Company’s acquisition activity during the nine months ended September 30, 2019: (Dollar amounts in thousands) Total Investments Ownership type Fee Interest Number of properties acquired 205 Allocation of Purchase Price: Land and improvements $ 145,889 Building and improvements 259,182 Construction in progress (1) 12,378 Intangible lease assets 11,896 Assets acquired 429,345 Intangible lease liabilities (116 ) Liabilities assumed (116 ) Purchase price (including acquisition costs) $ 429,229 (1) Represents amounts incurred at and subsequent to acquisition and includes approximately $0.2 million of capitalized interest expense. (Dollar amounts in thousands) Total Investments Ownership type (1) Number of properties acquired 165 Allocation of Purchase Price: Land and improvements $ 125,519 Building and improvements 253,754 Construction in progress (2) 14,307 Intangible lease assets 8,609 Assets acquired 402,189 Intangible lease liabilities (1,047 ) Liabilities assumed (1,047 ) Purchase price (including acquisition costs) $ 401,142 (1) During the nine months ended September 30, 2018, the Company acquired the fee interest in 164 properties and acquired one property subject to a ground lease arrangement. (2) Represents amounts incurred at and subsequent to acquisition and includes $0.2 million of capitalized interest. |
Schedule of Gross Investment Activity | During the nine months ended September 30, 2019 and 2018, the Company had the following gross investment activity: (Dollar amounts in thousands) Number of Investment Locations Dollar Amount of Investments Gross investments, January 1, 2018 508 $ 939,072 Acquisitions of and additions to real estate investments 165 403,218 Sales of investments in real estate (37) (38,174 ) Relinquishment of properties at end of ground lease term (2) (853 ) Provisions for impairment of real estate (1) (3,566 ) Investments in loans receivable 10,379 Principal collections on direct financing lease receivables (55 ) Other (2,772 ) Gross investments, September 30, 2018 1,307,249 Less: Accumulated depreciation and amortization (2) (43,630 ) Net investments, September 30, 2018 634 $ 1,263,619 Gross investments, January 1, 2019 677 $ 1,394,549 Acquisitions of and additions to real estate investments 205 433,208 Sales of investments in real estate (28) (51,568 ) Relinquishment of properties at end of ground lease term (2) (471 ) Provisions for impairment of real estate (4) (1,921 ) Investments in loans receivable 76 58,865 Principal collections on and settlements of loans and direct financing lease receivables (3) (11) (13,865 ) Other (1,008 ) Gross investments, September 30, 2019 1,817,789 Less: Accumulated depreciation and amortization (2) (79,482 ) Net investments, September 30, 2019 917 $ 1,738,307 (1) During the nine months ended September 30, 2018, the Company identified and recorded provisions for impairment at 7 vacant and 9 tenanted properties. The amount in the table above excludes approximately $40,000 related to intangible lease liabilities for these assets. (2) Includes $62.0 million and $31.4 million of accumulated depreciation as of September 30, 2019 and 2018, respectively. (3) During the nine months ended September 30, 2019, the Company acquired 10 properties that had secured two of its loans receivable for an aggregate purchase price of $11.8 million. These loans receivable had a carrying value of $9.2 million prior to their settlement. (4) During the nine months ended September 30, 2019, the Company identified and recorded provisions for impairment at 1 vacant and 5 tenanted properties. |
Schedule of Loans Receivable | The Company’s loans receivable as of September 30, 2019 and December 31, 2018 are summarized as follows (dollar amounts in thousands): Principal Balance Outstanding Loan Type Monthly Payment Number of Secured Properties Interest Rate Maturity Date September 30, 2019 December 31, 2018 Mortgage (1)(2) Interest only 1 10.00% 2021 $ 1,263 $ 2,376 Mortgage (1) Interest only 7.55% 2019 — 5,748 Mortgage (1)(2) Interest only 5.25% 2019 — 3,500 Mortgage (1) Interest only 3 8.80% 2039 16,800 — Mortgage (2) Principal + Interest 2 8.10% 2059 5,125 — Mortgage (1) Interest only 2 8.53% 2039 7,300 — Mortgage (1) Interest only 69 8.16% 2034 28,000 — Development construction (2)(3) Principal + Interest 8.00% 2058 — 3,230 Leasehold interest (4) Principal + Interest (4) 10.69% 2039 1,435 — Net investment $ 59,923 $ 14,854 (1 ) Loan requires monthly payments of interest only with a balloon payment due at maturity. (2) Loan allows for prepayments in whole or in part without penalty. (3) Loan was secured by a mortgage on the building and improvements at the development property. The Company provided periodic funding to the borrower under this arrangement as construction progressed. (4) This leasehold interest transaction is accounted for as a loan receivable, as the lease for two land parcels contains an option for the lessee to repurchase the leased assets in 2024 or 2025. |
Scheduled Principal Payments Due under Loans Receivable | Scheduled principal payments due under the Company’s loans receivable as of September 30, 2019 were as follows: (in thousands) Loans Receivable October 1, 2019 - December 31, 2019 $ — 2020 9 2021 1,283 2022 22 2023 24 Thereafter 58,585 Total $ 59,923 |
Schedule of Direct Financing Lease Receivables | The components of the investments accounted for as direct financing lease receivables were as follows: (in thousands) September 30, 2019 December 31, 2018 Minimum lease payments receivable $ 3,950 $ 4,198 Estimated unguaranteed residual value of leased assets 270 270 Unearned income from leased assets (1,638 ) (1,817 ) Net investment $ 2,582 $ 2,651 |
Scheduled Future Minimum Non-cancelable Base Rental Payments Under Direct Financing Lease Receivables | Scheduled future minimum non-cancelable base rental payments due to be received under the direct financing lease receivables as of September 30, 2019 were as follows: (in thousands) Future Minimum Base Rental Payments October 1, 2019 - December 31, 2019 $ 84 2020 337 2021 340 2022 345 2023 347 Thereafter 2,497 Total $ 3,950 |
Activity in Real Estate Investments and Intangible Lease Liabilities Held for Sale | The following table shows the activity in real estate investments held for sale and intangible lease liabilities held for sale during the nine months ended September 30, 2019 and 2018 (Dollar amounts in thousands) Number of Properties Real Estate Investments Intangible Lease Liabilities Net Carrying Value Held for sale balance, December 31, 2017 3 $ 4,173 $ (129 ) $ 4,044 Transfers to held for sale classification 12 14,487 (256 ) 14,231 Sales (13 ) (17,253 ) 385 (16,868 ) Transfers to held and used classification — — — — Held for sale balance, September 30, 2018 2 $ 1,407 $ — $ 1,407 Held for sale balance, December 31, 2018 — $ — $ — $ — Transfers to held for sale classification 4 6,239 — 6,239 Sales (4 ) (6,239 ) — (6,239 ) Transfers to held and used classification — — — — Held for sale balance, September 30, 2019 — $ — $ — $ — |
Schedule of External Customers by Geographic Areas | The following table lists the states where the rental revenue from the properties in that state during the periods presented represented 10% or more of total rental revenue in the Company’s consolidated statements of operations: Three months ended September 30, Nine months ended September 30, State 2019 2018 2019 2018 Texas 11.9% 11.6% 12.2% 12.6% Georgia 10.5% 11.1% 10.9% 11.5% |
Schedule of Intangible Assets and Liabilities | Intangible assets and liabilities consisted of the following as of the dates presented: September 30, 2019 December 31, 2018 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Intangible assets: In-place leases $ 60,150 $ 13,041 $ 47,109 $ 50,317 $ 9,498 $ 40,819 Intangible market lease assets 14,823 4,460 10,363 16,104 4,144 11,960 Total intangible assets $ 74,973 $ 17,501 $ 57,472 $ 66,421 $ 13,642 $ 52,779 Intangible market lease liabilities $ 11,982 $ 2,347 $ 9,635 $ 14,894 $ 3,278 $ 11,616 |
Summary of Remaining Weighted Average Amortization Periods for Intangible Assets and Liabilities | The remaining weighted average amortization periods for the Company’s intangible assets and liabilities as of September 30, 2019, by category and in total, were as follows: Years Remaining In-place leases 9.7 Intangible market lease assets 8.3 Total intangible assets 9.4 Intangible market lease liabilities 17.3 |
Summary of Amortization and Accretion Recognized | The following table discloses amounts recognized within the consolidated statements of operations related to amortization of in-place leases, amortization and accretion of above- and below-market lease assets and liabilities, net and the amortization and accretion of above- and below-market ground leases for the periods presented: Three months ended September 30, Nine months ended September 30, (in thousands) 2019 2018 2019 2018 Amortization of in-place leases (1) $ 1,739 $ 2,117 $ 4,622 $ 5,260 Amortization (accretion) of market lease intangibles, net (2) 302 245 746 642 Amortization (accretion) of above- and below-market ground lease intangibles, net (3) — (90 ) — (358 ) (1) Reflected within depreciation and amortization expense. (2) Reflected within rental revenue. (3) Reflected within property expenses. |
Summary of Projected Amortization Expenses for Next Five Years | The following table provides the projected amortization of in-place lease assets to depreciation and amortization expense and net amortization of above- and below-market lease intangibles to rental revenue for the next five years: (in thousands) October 1 - December 31, 2019 2020 2021 2022 2023 In-place lease assets $ 1,544 $ 5,417 $ 5,204 $ 5,052 $ 5,241 Adjustment to amortization expense $ 1,544 $ 5,417 $ 5,204 $ 5,052 $ 5,241 Above-market lease assets $ (326 ) $ (1,266 ) $ (1,247 ) $ (1,246 ) $ (1,214 ) Below-market lease liabilities 143 550 551 551 500 Net adjustment to rental revenue $ (183 ) $ (716 ) $ (696 ) $ (695 ) $ (714 ) |
Credit Facility (Tables)
Credit Facility (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revolving Credit Facility | |
Debt Instrument [Line Items] | |
Summary of Information about Revolving Credit Facility and 2018 Credit Facility | The following table presents information about the Revolving Credit Facility and the 2018 Credit Facility in effect for the nine months ended September 30, 2019 and 2018: (in thousands) 2019 2018 Balance on January 1, $ 34,000 $ — Borrowings 278,000 — Repayments (157,000 ) — Balance on September 30, $ 155,000 $ — |
Derivative and Hedging Activi_2
Derivative and Hedging Activities (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Summary of Notional Amount and Fair Value of Instruments | The following table summarizes the notional amount at inception and fair value of these instruments on the Company's balance sheet as of September 30, 2019 (dollar amounts in thousands). Derivatives Designated as Hedging Instruments Fixed Rate Paid by Company Variable Rate Paid by Bank Effective Date Maturity Date Notional Value (1) Fair Value of Asset/(Liability) (2) Interest Rate Swap 2.06% 1 month LIBOR 5/14/2019 4/12/2024 $ 100,000 $ (2,985 ) Interest Rate Swap 2.06% 1 month LIBOR 5/14/2019 4/12/2024 50,000 (1,493 ) Interest Rate Swap 2.07% 1 month LIBOR 5/14/2019 4/12/2024 50,000 (1,499 ) $ 200,000 $ (5,977 ) |
Secured Borrowings (Tables)
Secured Borrowings (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Summary of Scheduled Principal Payments | The following table summarizes the scheduled principal payments on the Company’s secured borrowings as of September 30, 2019, net of the scheduled principal receipts on the repurchased Class A Series 2016-1 Notes: (in thousands) Future Principal Payments October 1, 2019 - December 31, 2019 $ 1,175 2020 4,844 2021 73,419 2022 4,292 2023 4,512 Thereafter 222,329 Total $ 310,571 |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Summary of Quarterly Cash Dividends | During the , the Company’s board of directors declared the following quarterly cash dividends on common stock (dollars in thousands, except per share data): Date Declared Record Date Date Paid Dividend per Share of Common Stock Total Dividend September 6, 2019 September 30, 2019 October 15, 2019 $ 0.22 $ 17,531 June 5, 2019 June 28, 2019 July 15, 2019 $ 0.22 $ 12,725 March 8, 2019 March 29, 2019 April 16, 2019 $ 0.21 $ 12,143 |
Equity Based Compensation (Tabl
Equity Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Schedule of Assumptions Used in Measurement of Grant Date Fair Value of Total Shareholder Return RSUs Using Monte Carlo Simulation Model | The grant date fair value of the TSR RSUs was measured using a Monte Carlo simulation model based on the following assumptions: Volatility 18 % Risk free rate 2.57 % |
Schedule of Information about Restricted Stock Award and RSU Activity | The following table presents information about the Company’s restricted stock award and RSU activity during the nine months ended September 30, 2019 and 2018: Restricted Stock Awards Restricted Share Units Shares Weighted Average Grant Date Fair Value Units Weighted Average Grant Date Fair Value Unvested, January 1, 2018 — $ — — $ — Granted 691,290 13.68 — — Vested — — — — Forfeited — — — — Unvested, September 30, 2018 691,290 $ 13.68 — $ — Unvested, January 1, 2019 691,290 $ 13.68 — $ — Granted 46,368 14.12 100,814 22.80 Vested (244,957 ) 13.69 — — Forfeited — — — — Unvested, September 30, 2019 492,701 $ 13.72 100,814 $ 22.80 |
Schedule of Information about Class B and Class D Unit Activity | The following table presents information about the Class B and Class D unit activity during the nine months ended September 30, 2019 and 2018: Class B Units Class D Units Total Unvested, January 1, 2018 6,940 2,400 9,340 Granted — — — Vested (1,710 ) (600 ) (2,310 ) Forfeited — — — Unvested, September 30, 2018 5,230 1,800 7,030 Unvested, January 1, 2019 5,230 1,800 7,030 Granted — — — Vested (5,230 ) (1,800 ) (7,030 ) Forfeited — — — Unvested, September 30, 2019 — — — |
Restricted Stock Awards | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Schedule of Information about Restricted Stock Awards, Restricted Stock Units and Class B and Class D Units | The following table presents information about the Company’s restricted stock awards for the periods presented: Three months ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Compensation cost recognized in general and administrative expense $ 838 $ 823 $ 2,584 $ 869 Dividends declared and charged directly to distributions in excess of cumulative earnings 108 155 373 155 Fair value of shares vested during the period 60 — 3,354 — |
Schedule of Unrecognized Compensation Cost | The following table presents information about the Company’s restricted stock awards as of the dates presented: (Dollars in thousands) September 30, 2019 December 31, 2018 Total unrecognized compensation cost $ 5,836 $ 7,764 Weighted average period over which compensation cost will be recognized (in years) 1.9 2.5 |
Restricted Stock Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Schedule of Information about Restricted Stock Awards, Restricted Stock Units and Class B and Class D Units | The following table presents information about the Company’s RSUs for the periods presented: Three months ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Compensation cost recognized in general and administrative expense $ 212 $ — $ 502 $ — Dividend equivalents declared and charged directly to distributions in excess of cumulative earnings 2 — 5 — Fair value of units vested during the period — — — — |
Schedule of Unrecognized Compensation Cost | The following table presents information about the Company’s RSUs as of the dates presented: (Dollars in thousands) September 30, 2019 December 31, 2018 Total unrecognized compensation cost $ 1,796 $ — Weighted average period over which compensation cost will be recognized (in years) 2.6 — |
Class B and Class D Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Schedule of Information about Restricted Stock Awards, Restricted Stock Units and Class B and Class D Units | The following table presents information about the Class B and Class D units for the periods presented: Three months ended September 30, Nine Months Ended September 30, (in thousands) 2019 2018 2019 2018 Compensation cost recognized in general and administrative expense $ 1,692 $ 233 $ 2,130 $ 529 Fair value of units vested during the period 1,565 — 2,283 822 |
Schedule of Unrecognized Compensation Cost | The following table presents information about the Class B and Class D units as of the dates presented: Class B Units Class D Units (Dollars in thousands) September 30, 2019 December 31, 2018 September 30, 2019 December 31, 2018 Total unrecognized compensation cost $ — $ 1,899 $ — $ 231 Liability on units granted to non-employees $ — $ — $ — $ 33 Weighted average period over which compensation cost will be recognized (in years) — 2.3 — 2.3 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Scheduled Future Minimum Base Rental Payments due to be Received Under Remaining Non-Cancelable Term of Operating Leases (ASC 842) | Under ASC 842, scheduled future minimum base rental payments due to be received under the remaining non-cancelable term of the operating leases in place as of September 30, 2019 were as follows: (in thousands) Future Minimum Base Rental Receipts October 1, 2019 - December 31, 2019 $ 33,305 2020 133,653 2021 134,862 2022 136,697 2023 137,628 Thereafter 1,568,816 Total $ 2,144,961 |
Scheduled Future Minimum Base Rental Payments due to be Received Under Remaining Non-Cancelable Term of Operating Leases (ASC 840) | Under ASC 840, scheduled future minimum base rental payments due to be received under the remaining non-cancelable term of the operating leases in place as of December 31, 2018 were as follows: (in thousands) Future Minimum Base Rental Receipts 2019 105,827 2020 106,082 2021 106,743 2022 108,035 2023 105,924 Thereafter 1,150,158 Total $ 1,682,769 |
Components of Fixed and Variable Lease Revenues | The fixed and variable components (in thousands) Three months ended September 30, 2019 Nine months ended September 30, 2019 Fixed lease revenues $ 34,758 $ 96,687 Variable lease revenues (1) 474 1,990 Total lease revenues (2) $ 35,232 $ 98,677 (1) Includes contingent rent based on a percentage of the tenant’s gross sales and costs paid by the Company for which it is reimbursed by its tenants. (2) Excludes the amortization and accretion of above- and below-market lease intangible assets and liabilities and lease incentives and the adjustment to rental revenue for tenant credit. |
Information Related to Measurement of Lease Liabilities | The following table sets forth information related to the measurement of the Company’s lease liabilities as of September 30, 2019 : September 30, 2019 Weighted average remaining lease term (in years) 5.1 Weighted average discount rate 7.00% |
Details of Rent Expense | The following table : (in thousands) Three months ended September 30, 2019 Nine months ended September 30, 2019 Fixed rent expense $ 347 $ 1,068 Variable rent expense — — Total rent expense $ 347 $ 1,068 |
Summary of Future Lease Payments due from Company Under Ground, Office and Equipment Operating Leases (ASC 842) | As of September 30, 2019, under ASC 842, future lease payments due from the Company under the ground, office and equipment operating leases where the Company is directly responsible for payment and the future lease payments due under the ground operating leases where the Company’s tenants are directly responsible for payment over the next five years and thereafter were as follows: (in thousands) Office and Ground Leases to be Paid by the Company Ground Leases to be Paid Directly by the Company’s Tenants Total Future Minimum Base Rental Payments October 1, 2019 - December 31, 2019 $ 215 $ 81 $ 296 2020 763 328 1,091 2021 680 331 1,011 2022 669 327 996 2023 656 26 682 Thereafter 1,093 — 1,093 Total $ 4,076 $ 1,093 5,169 Present value discount (971 ) Lease liabilities $ 4,198 |
Summary of Future Lease Payments due from Company Under Ground, Office and Equipment Operating Leases (ASC 840) | As of December future lease payments due from the Company under the ground, office and equipment operating leases where the Company is directly responsible for payment and the future lease payments due under the ground operating leases where the Company’s tenants are directly responsible for payment over the next five years and thereafter were as follows (in thousands) Office and Ground Leases to be Paid by the Company Ground Leases to be Paid Directly by the Company’s Tenants Total Future Minimum Base Rental Payments 2019 $ 893 $ 492 $ 1,385 2020 759 328 1,087 2021 680 331 1,011 2022 669 327 996 2023 656 26 682 Thereafter 1,093 — 1,093 Total $ 4,750 $ 1,504 $ 6,254 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Values of Real Estate Investments Measured at Nonrecurring Basis | The Company measures its real estate investments at fair value on a nonrecurring basis. The fair values of these real estate investments were determined using the following input levels as of the date presented: Net Carrying Fair Value Measurements Using Fair Value Hierarchy (in thousands) Value Fair Value Level 1 Level 2 Level 3 December 31, 2018 Non-financial assets: Long-lived assets $ 3,238 $ 3,238 $ — $ — $ 3,238 |
Organization - Additional Infor
Organization - Additional Information (Details) $ / shares in Units, $ in Thousands | Jul. 22, 2019shares | Mar. 18, 2019USD ($)$ / sharesshares | Jul. 24, 2018USD ($)$ / sharesshares | Jun. 30, 2018shares | Jun. 25, 2018$ / sharesshares | Jan. 31, 2017ClassofEquity | Aug. 31, 2019USD ($) | Jul. 20, 2018$ / sharesshares | Sep. 30, 2019USD ($)$ / sharesshares | Mar. 31, 2019shares | Sep. 30, 2018shares | Sep. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($) | Dec. 31, 2018$ / sharesshares | Jun. 21, 2018shares | Jun. 20, 2018shares | Dec. 31, 2017 |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Common shares, par value per share | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||||||
Proceeds from issuance of shares, net of underwriting discounts and commissions and other expenses | $ | $ 309,768 | $ 464,182 | |||||||||||||||
Common stock, issued shares | 79,672,970 | 79,672,970 | 43,749,092 | ||||||||||||||
Number of classes of equity units issued | ClassofEquity | 4 | ||||||||||||||||
Sale of stock, percentage of ownership after transaction | 52.30% | ||||||||||||||||
Operating Partnership Unit | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Proceeds from concurrent private placement | $ | 16,001 | ||||||||||||||||
Stonebriar Holdings | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Percentage of ownership | 45.70% | ||||||||||||||||
EPRT Management | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Percentage of ownership | 2.00% | ||||||||||||||||
Change in ownership percentages | 0.00% | ||||||||||||||||
EPRT Holdings LLC | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Interest received in Operating Partnership | 17,913,592 | 17,913,592 | |||||||||||||||
Common Stock | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Common stock issued, shares | 32,500,000 | 3,344,805 | 14,030,000 | 2,772,191 | |||||||||||||
Common stock, price per share | $ / shares | $ 14 | ||||||||||||||||
Proceeds from concurrent private placement | $ | $ 108,999 | ||||||||||||||||
Concurrent private placement of common stock, shares | 7,785,611 | ||||||||||||||||
Common stock to purchase number of additional shares | 4,875,000 | ||||||||||||||||
Initial Public Offering | Common Stock | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Common stock issued, shares | 2,772,191 | 32,500,000 | |||||||||||||||
Common shares, par value per share | $ / shares | $ 0.01 | ||||||||||||||||
Common stock, price per share | $ / shares | $ 14 | $ 14 | |||||||||||||||
Proceeds from issuance of shares, net of underwriting discounts and commissions and other expenses | $ | $ 458,700 | ||||||||||||||||
Private Placement | Eldridge Industries, LLC | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Proceeds from concurrent private placement | $ | $ 125,000 | ||||||||||||||||
Common stock, issued shares | 43,057,802 | ||||||||||||||||
Private Placement | Eldridge Industries, LLC | Operating Partnership | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Operating partnership units issued | 1,142,960 | ||||||||||||||||
Private Placement | Common Stock | Eldridge Industries, LLC | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Concurrent private placement of common stock, shares | 7,785,611 | ||||||||||||||||
Follow-On Offering | Common Stock | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Common stock issued, shares | 14,030,000 | ||||||||||||||||
Common stock, price per share | $ / shares | $ 17.50 | ||||||||||||||||
Proceeds from issuance of shares, net of underwriting discounts and commissions and other expenses | $ | $ 234,600 | ||||||||||||||||
Common stock to purchase number of additional shares | 1,830,000 | ||||||||||||||||
Secondary Offering | Operating Partnership Unit | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Operating partnership units outstanding | 553,847 | 553,847 | |||||||||||||||
Secondary Offering | Operating Partnership | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Operating partnership units converted | 18,502,705 | 18,502,705 | |||||||||||||||
Secondary Offering | Common Stock | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Common stock issued, shares | 26,288,316 | ||||||||||||||||
Stock issued during period for options to purchase additional shares | 3,428,910 | ||||||||||||||||
ATM program | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Common stock, issued shares | 3,344,805 | 3,344,805 | |||||||||||||||
Common stock weighted average price per share | $ / shares | $ 22.42 | $ 22.42 | |||||||||||||||
Proceeds from issuance of common stock gross | $ | $ 75,000 | $ 75,000 | |||||||||||||||
ATM program | Maximum | |||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||||||||||||||
Common stock shares authorized, value | $ | $ 200,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Principles - Additional Information (Details) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019USD ($)LoanEntity | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)LoanEntitySegment | Sep. 30, 2018USD ($) | Jan. 01, 2019USD ($) | Dec. 31, 2018USD ($)Loan | |
Summary Of Significant Accounting Policies [Line Items] | ||||||
Percentage of ownership interests in operating partnership | 98.30% | 98.30% | 69.70% | |||
Allowance for loan losses | $ 0 | $ 0 | $ 0 | |||
Provision for impairment | 0 | $ 770,000 | 1,921,000 | $ 3,526,000 | ||
Deposits | 23,446,000 | 73,271,000 | 23,446,000 | 73,271,000 | 4,236,000 | |
Deposits in excess of amount insured by FDIC | 23,200,000 | 23,200,000 | 4,000,000 | |||
Adjustment to rental revenue | 0 | 25,000 | ||||
Contingent rent | 100,000 | 200,000 | 700,000 | 900,000 | ||
Capitalized offering costs | 47,600,000 | $ 47,600,000 | 35,100,000 | |||
Percentage of taxable income require to REIT | 90.00% | |||||
Provision for income tax | 0 | $ 0 | ||||
Uncertain tax positions, interest or penalties | 0 | 0 | 0 | 0 | ||
Uncertain tax position, interest or penalties accrued | 0 | 0 | 0 | |||
Mortgage loan receivable | $ 59,923,000 | $ 59,923,000 | $ 14,854,000 | |||
Number of loan receivable agreements secured | Loan | 6 | 6 | 4 | |||
Aggregate carrying value of loans receivable | $ 59,900,000 | $ 59,900,000 | $ 14,900,000 | |||
Number of reportable segments | Segment | 1 | |||||
Common stock, conversion basis | one-for-one basis | |||||
Right-of-use asset | 3,300,000 | $ 3,300,000 | ||||
Lease liability | 4,198,000 | 4,198,000 | ||||
ASU 2016-02 | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Right-of-use asset | $ 4,800,000 | |||||
Lease liability | $ 4,800,000 | |||||
Variable Interest Entities ("VIEs") | Mortgage Loan Receivable | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Mortgage loan receivable | 5,700,000 | |||||
Mortgage loan receivable, maximum loss exposure | 5,700,000 | |||||
Liabilities associated with investment | $ 0 | $ 0 | 0 | |||
Number of loan receivable agreements secured | Loan | 0 | 0 | ||||
Aggregate carrying value of loans receivable | $ 30,700,000 | $ 30,700,000 | ||||
Number of variable interest entities | Entity | 5 | 5 | ||||
Federal | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Open tax year | 2016 2017 2018 | |||||
State | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Open tax year | 2016 2017 2018 | |||||
Base Rent | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Allowance for doubtful accounts receivable | $ 100,000 | $ 100,000 | 100,000 | |||
Straight-line Rent | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Allowance for doubtful accounts receivable | 0 | 0 | $ 0 | |||
Property Expenses | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Allowance for doubtful accounts | 200,000 | 300,000 | ||||
Real Estate Investments | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Depreciation | $ 9,400,000 | $ 6,600,000 | $ 25,700,000 | $ 17,600,000 | ||
Buildings | Maximum | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Estimated useful life | 40 years | |||||
Site Improvements | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Estimated useful life | 15 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Principles - Reconciliation of Numerator and Denominator used in Computation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Sep. 30, 2018 | Jun. 24, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 |
Numerator for basic and diluted earnings per share: | ||||||||||
Net income | $ 321 | $ 14,106 | $ 10,571 | $ 8,723 | $ 7,707 | $ 3,176 | $ 1,109 | $ 33,399 | $ 12,314 | |
Net income | 7,708 | $ 8,029 | ||||||||
Net income attributable to non-controlling interests | (861) | (2,383) | (2,482) | (6,076) | (2,482) | |||||
Less: net income allocated to unvested restricted common stock and RSUs | (110) | (155) | (155) | (377) | ||||||
Net income available for common stockholders: basic | 13,135 | 5,169 | 5,392 | 26,946 | ||||||
Net income attributable to non-controlling interests | 861 | 2,383 | 2,482 | 6,076 | $ 2,482 | |||||
Net income available for common stockholders: diluted | $ 13,996 | $ 7,552 | $ 7,874 | $ 33,022 | ||||||
Denominator for basic and diluted earnings per share: | ||||||||||
Weighted average common shares outstanding | 72,979,558 | 43,056,044 | 42,928,750 | 59,025,313 | ||||||
Less: weighted average number of shares of unvested restricted common stock | (495,626) | (691,290) | (691,290) | (649,568) | ||||||
Weighted average shares outstanding used in basic net income per share | 72,483,932 | 42,364,754 | 42,237,460 | 58,375,745 | ||||||
Effects of dilutive securities: | ||||||||||
Weighted average shares outstanding used in diluted net income per share | 77,612,949 | 61,472,675 | 61,342,278 | 73,021,273 | ||||||
Operating Partnership Unit | ||||||||||
Effects of dilutive securities: | ||||||||||
Dilutive securities | 4,777,291 | 19,056,552 | 19,056,552 | 14,244,493 | ||||||
Unvested Restricted Common Stock and RSUs | ||||||||||
Effects of dilutive securities: | ||||||||||
Dilutive securities | 351,726 | 51,369 | 48,266 | 401,035 |
Investments - Additional Inform
Investments - Additional Information (Details) $ in Thousands | Oct. 01, 2019USD ($)Property | Sep. 30, 2019USD ($)LoanPropertyInvestment | Sep. 30, 2018USD ($)Investment | Dec. 31, 2018USD ($)LoanPropertyInvestment | Dec. 31, 2017USD ($) |
Investment Holdings [Line Items] | |||||
Number of property locations of investments | Property | 917 | 665 | |||
Number of property development in progress | Property | 6 | 4 | |||
Number of real estate properties undeveloped land parcels | Property | 1 | 1 | |||
Number of mortgage loans receivable | Loan | 5 | 3 | |||
Number of additional properties secured for mortgage loan receivable | Property | 75 | 12 | |||
Number of owned properties | Property | 831 | 652 | |||
Number of properties owned as direct financing receivables | Property | 7 | 5 | |||
Number of ground lease interests | Property | 11 | 13 | |||
Number of real estate subject to direct financing leases | Property | 1 | 1 | |||
Gross acquisition cost of real estate investments | $ 1,817,789 | $ 1,307,249 | $ 1,394,549 | $ 939,072 | |
Real estate investments, at cost | 1,755,284 | 1,377,044 | |||
Aggregate carrying amount of loans and direct financing lease receivable | $ 62,500 | $ 17,500 | |||
Number of investments | Investment | 356 | 347 | |||
Net investments | $ 611,900 | $ 609,200 | |||
Number of acquisitions represented more than five percentage of total investment activity | Investment | 0 | 0 | |||
Number of loan receivable agreements secured | Loan | 6 | 4 | |||
Aggregate carrying value of loans receivable | $ 59,900 | $ 14,900 | |||
Number of loans settled or repaid in full | Loan | 3 | ||||
Loans receivable, maturity period | 2021 | ||||
Partial repayment of note receivable | $ 1,100 | ||||
Loans receivables aggregate carrying value | 58,700 | ||||
Aggregate carrying amount of direct financing lease receivable | 2,600 | $ 2,700 | |||
Subsequent Event | |||||
Investment Holdings [Line Items] | |||||
Number of real estate investment properties | Property | 32 | ||||
Aggregate investment (including acquisition-related costs) | $ 69,300 | ||||
Investment in new and ongoing construction in progress | $ 4,800 | ||||
Number of investment properties sold or transferred | Property | 3 | ||||
Investment, aggregate gross sales price | $ 2,100 | ||||
Investment, disposition costs | $ 100 | ||||
Mortgage Loans Receivable One | |||||
Investment Holdings [Line Items] | |||||
Proceeds from loans receivable | 5,700 | ||||
Mortgage Loans Receivable Two | |||||
Investment Holdings [Line Items] | |||||
Proceeds from loans receivable | 3,500 | ||||
Mortgage Loans Receivable Three | |||||
Investment Holdings [Line Items] | |||||
Proceeds from loans receivable | $ 3,400 |
Investments - Schedule of Infor
Investments - Schedule of Information about Acquisition Activity (Details) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2019USD ($)Property | Sep. 30, 2018USD ($)Property | |||
Investments [Abstract] | ||||
Ownership type | Fee Interest | fee interest | ||
Number of properties acquired | Property | 205 | 165 | ||
Allocation of Purchase Price: | ||||
Land and improvements | $ 145,889 | $ 125,519 | ||
Building and improvements | 259,182 | 253,754 | ||
Construction in progress | 12,378 | [1] | 14,307 | [2] |
Intangible lease assets | 11,896 | 8,609 | ||
Assets acquired | 429,345 | 402,189 | ||
Intangible lease liabilities | (116) | (1,047) | ||
Liabilities assumed | (116) | (1,047) | ||
Purchase price (including acquisition costs) | $ 429,229 | $ 401,142 | ||
[1] | Represents amounts incurred at and subsequent to acquisition and includes approximately $0.2 million of capitalized interest expense. | |||
[2] | Represents amounts incurred at and subsequent to acquisition and includes $0.2 million of capitalized interest. |
Investments - Schedule of Inf_2
Investments - Schedule of Information about Acquisition Activity (Parenthetical) (Details) $ in Millions | 9 Months Ended | |
Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($)Property | |
Investments [Abstract] | ||
Capitalized interest expense | $ | $ 0.2 | $ 0.2 |
Ownership type | Fee Interest | fee interest |
Number of properties in which fee interest acquired | 164 | |
Number of properties acquired subject to ground lease arrangement | 1 |
Investments - Summary of Gross
Investments - Summary of Gross Investment Activity (Details) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019USD ($)InvestmentLocation | Sep. 30, 2018USD ($)InvestmentLocation | Dec. 31, 2018USD ($) | |
Real Estate Investments [Abstract] | |||
Number of Investment Locations | InvestmentLocation | 677 | 508 | |
Number of Investment Locations, Acquisitions of and additions to real estate investments | InvestmentLocation | 205 | 165 | |
Number of Investment Locations, Sales of investments in real estate | InvestmentLocation | (28) | (37) | |
Number of Investment Locations, Relinquishment of properties at end of ground lease term | InvestmentLocation | (2) | (2) | |
Number of Investment Locations, Principal collections on and settlements of loans and direct financing lease receivables | InvestmentLocation | (11) | ||
Number of Investment Locations | InvestmentLocation | 917 | 634 | |
Number of Investment Locations,Investments in loans receivable | InvestmentLocation | 76 | ||
Gross investments | $ 1,394,549 | $ 939,072 | |
Acquisitions of and additions to real estate investments | 433,208 | 403,218 | |
Sales of investments in real estate | (51,568) | (38,174) | |
Relinquishment of properties at end of ground lease term | (471) | (853) | |
Provisions for impairment of real estate | (1,921) | (3,566) | |
Investments in loans receivable | 58,865 | 10,379 | |
Principal collections on loans and direct financing lease receivables | (55) | ||
Principal collections on and settlements of loans and direct financing lease receivables | (13,865) | ||
Other | (1,008) | (2,772) | |
Gross investments | 1,817,789 | 1,307,249 | |
Less: accumulated depreciation and amortization | (79,482) | (43,630) | $ (51,855) |
Net investments | $ 1,738,307 | $ 1,263,619 | $ 1,342,694 |
Investments - Summary of Gros_2
Investments - Summary of Gross Investment Activity (Parenthetical) (Details) | Sep. 30, 2018USD ($)Property | Sep. 30, 2019USD ($)Property | Dec. 31, 2018Property |
Real Estate Properties [Line Items] | |||
Number of property locations of investments | Property | 917 | 665 | |
Intangible lease liabilities | $ | $ 40,000 | ||
Accumulated depreciation | $ | $ 31,400,000 | $ 62,000,000 | |
Number of real estate properties acquired | Property | 10 | ||
Loans receivable to purchaser of real estate property | $ | $ 11,800,000 | ||
Loans receivable carrying value | $ | $ 9,200,000 | ||
Vacant Properties | |||
Real Estate Properties [Line Items] | |||
Number of property locations of investments | Property | 7 | 1 | |
Tenanted Properties | |||
Real Estate Properties [Line Items] | |||
Number of property locations of investments | Property | 9 | 5 |
Investments - Schedule of Loans
Investments - Schedule of Loans Receivable (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019USD ($)Property | Dec. 31, 2018USD ($) | |
Loans Receivable Disclosure [Line Items] | ||
Maturity Date | 2021 | |
Principal Balance Outstanding | $ 59,923 | $ 14,854 |
Mortgage Loan Receivable 10 % Due at 2021 | ||
Loans Receivable Disclosure [Line Items] | ||
Monthly Payment | Interest only | |
Number of Secured Properties | Property | 1 | |
Interest Rate | 10.00% | |
Maturity Date | 2021 | |
Principal Balance Outstanding | $ 1,263 | 2,376 |
Mortgage Loan Receivable 7.55% Due at 2019 | ||
Loans Receivable Disclosure [Line Items] | ||
Monthly Payment | Interest only | |
Interest Rate | 7.55% | |
Maturity Date | 2019 | |
Principal Balance Outstanding | 5,748 | |
Mortgage Loan Receivable 5.25% Due at 2019 | ||
Loans Receivable Disclosure [Line Items] | ||
Monthly Payment | Interest only | |
Interest Rate | 5.25% | |
Maturity Date | 2019 | |
Principal Balance Outstanding | 3,500 | |
Mortgage Loan Receivable 8.80% Due at 2039 | ||
Loans Receivable Disclosure [Line Items] | ||
Monthly Payment | Interest only | |
Number of Secured Properties | Property | 3 | |
Interest Rate | 8.80% | |
Maturity Date | 2039 | |
Principal Balance Outstanding | $ 16,800 | |
Mortgage Loan Receivable 8.10% Due at 2059 | ||
Loans Receivable Disclosure [Line Items] | ||
Monthly Payment | Principal + Interest | |
Number of Secured Properties | Property | 2 | |
Interest Rate | 8.10% | |
Maturity Date | 2059 | |
Principal Balance Outstanding | $ 5,125 | |
Mortgage Loan Receivable 8.53% Due at 2039 | ||
Loans Receivable Disclosure [Line Items] | ||
Monthly Payment | Interest only | |
Number of Secured Properties | Property | 2 | |
Interest Rate | 8.53% | |
Maturity Date | 2039 | |
Principal Balance Outstanding | $ 7,300 | |
Mortgage Loan Receivable 8.16% Due at 2034 | ||
Loans Receivable Disclosure [Line Items] | ||
Monthly Payment | Interest only | |
Number of Secured Properties | Property | 69 | |
Interest Rate | 8.16% | |
Maturity Date | 2034 | |
Principal Balance Outstanding | $ 28,000 | |
Development Construction Loan Receivable 8.00% Due at 2058 | ||
Loans Receivable Disclosure [Line Items] | ||
Monthly Payment | Principal + Interest | |
Interest Rate | 8.00% | |
Maturity Date | 2058 | |
Principal Balance Outstanding | $ 3,230 | |
Leasehold Interest 10.69% Due 2039 | ||
Loans Receivable Disclosure [Line Items] | ||
Monthly Payment | Principal + Interest | |
Interest Rate | 10.69% | |
Maturity Date | 2039 | |
Principal Balance Outstanding | $ 1,435 |
Investments - Schedule of Loa_2
Investments - Schedule of Loans Receivable (Parenthetical) (Details) | 9 Months Ended |
Sep. 30, 2019Land | |
Loans Receivable Disclosure [Line Items] | |
Number of land lease have option for lessee to purchase leased assets | 2 |
Minimum | |
Loans Receivable Disclosure [Line Items] | |
Option for the lessee to repurchase the leased assets in year | 2024 |
Maximum | |
Loans Receivable Disclosure [Line Items] | |
Option for the lessee to repurchase the leased assets in year | 2025 |
Investments - Scheduled of Prin
Investments - Scheduled of Principal Payments Due under Loans Receivable (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Loans Receivable Scheduled Principal Payments Due To Be Received [Abstract] | ||
2020 | $ 9 | |
2021 | 1,283 | |
2022 | 22 | |
2023 | 24 | |
Thereafter | 58,585 | |
Total | $ 59,923 | $ 14,854 |
Investments - Schedule of Direc
Investments - Schedule of Direct Financing Lease Receivables (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Net Investment In Leases [Abstract] | ||
Minimum lease payments receivable | $ 3,950 | $ 4,198 |
Estimated unguaranteed residual value of leased assets | 270 | 270 |
Unearned income from leased assets | (1,638) | (1,817) |
Net investment | $ 2,582 | $ 2,651 |
Investments - Scheduled Future
Investments - Scheduled Future Minimum Non-cancelable Base Rental Payments Under Direct Financing Lease Receivables (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Net Investment In Leases [Abstract] | |
October 1, 2019 - December 31, 2019 | $ 84 |
2020 | 337 |
2021 | 340 |
2022 | 345 |
2023 | 347 |
Thereafter | 2,497 |
Total | $ 3,950 |
Investments - Activity in Real
Investments - Activity in Real Estate Investments and Intangible Lease Liabilities Held for Sale (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019USD ($)Property | Sep. 30, 2018USD ($)Property | |
Investments [Abstract] | ||
Number of Properties, Held for sale balance | Property | 3 | |
Number of Properties, Transfers to held for sale classification | Property | 4 | 12 |
Number of Properties, Sales | Property | (4) | (13) |
Number of Properties, Held for sale balance | Property | 2 | |
Real Estate Investments, Held for sale balance | $ 4,173 | |
Real Estate Investments, Transfers to held for sale classification | $ 6,239 | 14,487 |
Real Estate Investments, Sales | (6,239) | (17,253) |
Real Estate Investments, Held for sale balance | 1,407 | |
Intangible Lease Liabilities, Held for sale balance | (129) | |
Intangible Lease Liabilities, Transfers to held for sale classification | (256) | |
Intangible Lease Liabilities, Sales | 385 | |
Net Carrying Value, Held for sale balance | 4,044 | |
Net Carrying Value, Transfers to held for sale classification | 6,239 | 14,231 |
Net Carrying Value, Sales | $ (6,239) | (16,868) |
Net Carrying Value, Held for sale balance | $ 1,407 |
Investments - Schedule of Exter
Investments - Schedule of External Customers by Geographic Areas (Details) - Rental Revenue - Geographic Concentration Risk | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Texas | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 11.90% | 11.60% | 12.20% | 12.60% |
Georgia | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 10.50% | 11.10% | 10.90% | 11.50% |
Investments - Schedule of Intan
Investments - Schedule of Intangible Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | $ 74,973 | $ 66,421 |
Intangible assets, Accumulated Amortization | 17,501 | 13,642 |
Intangible assets, Net Carrying Amount | 57,472 | 52,779 |
Intangible market lease liabilities, Gross Carrying Amount | 11,982 | 14,894 |
Intangible market lease liabilities, Accumulated Amortization | 2,347 | 3,278 |
Intangible market lease liabilities, Net Carrying Amount | 9,635 | 11,616 |
In-place Leases | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | 60,150 | 50,317 |
Intangible assets, Accumulated Amortization | 13,041 | 9,498 |
Intangible assets, Net Carrying Amount | 47,109 | 40,819 |
Intangible Market Lease Assets | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | 14,823 | 16,104 |
Intangible assets, Accumulated Amortization | 4,460 | 4,144 |
Intangible assets, Net Carrying Amount | $ 10,363 | $ 11,960 |
Investments - Summary of Remain
Investments - Summary of Remaining Weighted Average Amortization Periods for Intangible Assets and Liabilities (Details) | 9 Months Ended |
Sep. 30, 2019 | |
Finite Lived Intangible Assets [Line Items] | |
Total intangible assets | 9 years 4 months 24 days |
Remaining weighted average amortization period, Intangible market lease liabilities | 17 years 3 months 18 days |
In-place Leases | |
Finite Lived Intangible Assets [Line Items] | |
Remaining weighted average amortization period, In-place leases | 9 years 8 months 12 days |
Intangible Market Lease Assets | |
Finite Lived Intangible Assets [Line Items] | |
Total intangible assets | 8 years 3 months 18 days |
Investments - Summary of Amorti
Investments - Summary of Amortization and Accretion Recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Amortization of In-Place Leases, Amortization and Accretion of Above- and Below-Market Lease Assets and Liabilities [Line Items] | ||||
Amortization of in-place leases | $ 1,739 | $ 2,117 | $ 4,622 | $ 5,260 |
Market Lease Intangibles | Rental Revenue | ||||
Amortization of In-Place Leases, Amortization and Accretion of Above- and Below-Market Lease Assets and Liabilities [Line Items] | ||||
Amortization (accretion) of market lease intangibles, net | $ 302 | 245 | $ 746 | 642 |
Above and Below Market Ground Lease Intangibles | Property Expenses | ||||
Amortization of In-Place Leases, Amortization and Accretion of Above- and Below-Market Lease Assets and Liabilities [Line Items] | ||||
Amortization (accretion) of above- and below-market ground lease intangibles, net | $ (90) | $ (358) |
Investments - Summary of Projec
Investments - Summary of Projected Amortization Expenses for Next Five Years (Details) $ in Thousands | Sep. 30, 2019USD ($) |
In-place Leases | Amortization Expense | |
Finite Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets, amortization expense, October1 - December 31, 2019 | $ 1,544 |
Finite-lived intangible assets, amortization expense, 2020 | 5,417 |
Finite-lived intangible assets, amortization expense, 2021 | 5,204 |
Finite-lived intangible assets, amortization expense, 2022 | 5,052 |
Finite-lived intangible assets, amortization expense, 2023 | 5,241 |
Adjustment in-place Lease | Amortization Expense | |
Finite Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets, amortization expense, October1 - December 31, 2019 | 1,544 |
Finite-lived intangible assets, amortization expense, 2020 | 5,417 |
Finite-lived intangible assets, amortization expense, 2021 | 5,204 |
Finite-lived intangible assets, amortization expense, 2022 | 5,052 |
Finite-lived intangible assets, amortization expense, 2023 | 5,241 |
Above-Market Lease Assets | Rental Revenue | |
Finite Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets, amortization expense, Above and below market lease (assets) liabilities net adjustment to rental revenue, October 1 - December 31, 2019 | (326) |
Finite-lived intangible assets, amortization expense, 2020 | (1,266) |
Finite-lived intangible assets, amortization expense, 2021 | (1,247) |
Finite-lived intangible assets, amortization expense, 2022 | (1,246) |
Finite-lived intangible assets, amortization expense, 2023 | (1,214) |
Below-Market Lease Liabilities | Rental Revenue | |
Finite Lived Intangible Assets [Line Items] | |
Below market leases, amortization income, October 1 - December 31, 2019 | 143 |
Below market leases, amortization income, 2020 | 550 |
Below market leases, amortization income, 2021 | 551 |
Below market leases, amortization income, 2022 | 551 |
Below market leases, amortization income, 2023 | 500 |
Net Adjustment in-place Lease | Rental Revenue | |
Finite Lived Intangible Assets [Line Items] | |
Above and below market lease (assets) liabilities net adjustment to rental revenue, October 1 - December 31, 2019 | (183) |
Above and below market lease (assets) liabilities net adjustment to rental revenue, 2020 | (716) |
Above and below market lease (assets) liabilities net adjustment to rental revenue, 2021 | (696) |
Above and below market lease (assets) liabilities net adjustment to rental revenue, 2022 | (695) |
Above and below market lease (assets) liabilities net adjustment to rental revenue, 2023 | $ (714) |
Credit Facility - Additional In
Credit Facility - Additional Information (Details) - USD ($) | Apr. 12, 2019 | Jun. 25, 2018 | Sep. 30, 2019 |
Senior Unsecured Revolving Credit Facility | |||
Line Of Credit Facility [Line Items] | |||
Aggregate revolving credit commitments | $ 300,000,000 | ||
Credit facility term | 4 years | ||
Maximum additional availability of the facility | $ 200,000,000 | ||
Senior Unsecured Revolving Credit Facility | Minimum | LIBOR | |||
Line Of Credit Facility [Line Items] | |||
Annual interest rate | 1.45% | ||
Senior Unsecured Revolving Credit Facility | Minimum | Prime Rate | |||
Line Of Credit Facility [Line Items] | |||
Annual interest rate | 0.45% | ||
Senior Unsecured Revolving Credit Facility | Maximum | |||
Line Of Credit Facility [Line Items] | |||
Credit facility extension term | 12 months | ||
Senior Unsecured Revolving Credit Facility | Maximum | LIBOR | |||
Line Of Credit Facility [Line Items] | |||
Annual interest rate | 2.15% | ||
Senior Unsecured Revolving Credit Facility | Maximum | Prime Rate | |||
Line Of Credit Facility [Line Items] | |||
Annual interest rate | 1.15% | ||
Amended Credit Facility | |||
Line Of Credit Facility [Line Items] | |||
Aggregate revolving credit commitments | $ 400,000,000 | ||
Credit facility term | 4 years | ||
Number of non-consecutive occasions | 2 | ||
Total consolidated leverage ratio of non consecutive occasions | 65.00% | ||
Number of consecutive quarters | 2 | ||
Consolidated secured leverage ratio | 50.00% | ||
Secured recourse debt ratio | 10.00% | ||
Unencumbered interest coverage ratio | 175.00% | ||
Amended Credit Facility | Minimum | |||
Line Of Credit Facility [Line Items] | |||
Total consolidated leverage ratio | 150.00% | ||
Consolidated tangible net worth | 75.00% | ||
Amended Credit Facility | Maximum | |||
Line Of Credit Facility [Line Items] | |||
Credit facility extension term | 12 months | ||
Total consolidated leverage ratio | 60.00% | ||
Unencumbered leverage ratio | 60.00% | ||
Term Loan Facility | |||
Line Of Credit Facility [Line Items] | |||
Credit facility term | 5 years | ||
Annual interest rate | 3.40% | ||
Maximum additional availability of the facility | $ 200,000,000 |
Credit Facility - Summary of In
Credit Facility - Summary of Information about Revolving Credit Facility and 2018 Credit Facility (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Line Of Credit Facility [Line Items] | |
Balance on January 1, | $ 34,000 |
Borrowings | 278,000 |
Repayments | (157,000) |
Balance on September 30, | 155,000 |
Revolving Credit Facility and the 2018 Credit Facility | |
Line Of Credit Facility [Line Items] | |
Balance on January 1, | 34,000 |
Borrowings | 278,000 |
Repayments | (157,000) |
Balance on September 30, | $ 155,000 |
Credit Facility - Revolving Cre
Credit Facility - Revolving Credit Facility - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Line Of Credit Facility [Line Items] | |||||
Total deferred finance costs, net | $ 4.9 | $ 4.9 | $ 9 | ||
Interest expense recorded from amortization of deferred financing costs | 0.3 | $ 0.6 | 1.3 | $ 1.7 | |
Revolving Credit Facility and the 2018 Credit Facility | |||||
Line Of Credit Facility [Line Items] | |||||
Interest expense recorded from amortization of deferred financing costs | $ 0.3 | 0.2 | $ 0.8 | 0.3 | |
Weighted-average interest rate | 3.31% | 3.31% | 5.95% | ||
Line of credit facility, unused borrowing capacity | $ 245 | $ 245 | $ 266 | ||
Revolving Credit Facility and the 2018 Credit Facility | Prepaid Expenses and Other Current Assets, Net | |||||
Line Of Credit Facility [Line Items] | |||||
Total deferred finance costs, net | 3.8 | 3.8 | $ 3 | ||
Revolving Credit Facility | |||||
Line Of Credit Facility [Line Items] | |||||
Interest expense on borrowings and unused facility fees | $ 1.1 | $ 0.2 | $ 2.1 | $ 0.2 |
Credit Facility - Unsecured Ter
Credit Facility - Unsecured Term Loan - Additional Information (Details) - USD ($) | May 14, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 |
Line Of Credit Facility [Line Items] | ||||||
Borrowings under revolving credit facility | $ 278,000,000 | |||||
Total deferred finance costs, net | $ 4,900,000 | 4,900,000 | $ 9,000,000 | |||
Interest expense recorded from amortization of deferred financing costs | 300,000 | $ 600,000 | $ 1,300,000 | $ 1,700,000 | ||
Interest Rate Swaps | ||||||
Line Of Credit Facility [Line Items] | ||||||
Annual interest rate | 3.26% | |||||
Term Loan Facility | ||||||
Line Of Credit Facility [Line Items] | ||||||
Annual interest rate | 3.40% | |||||
Unsecured Term Loan | Term Loan Facility | ||||||
Line Of Credit Facility [Line Items] | ||||||
Borrowings under revolving credit facility | $ 200,000,000 | |||||
Total deferred finance costs, net | 900,000 | $ 900,000 | ||||
Interest expense recorded from amortization of deferred financing costs | 47,000 | 100,000 | ||||
Unsecured Term Loan | Term Loan Facility | Interest Expense | ||||||
Line Of Credit Facility [Line Items] | ||||||
Interest expense including delayed draw ticking fees | $ 1,800,000 | $ 2,800,000 |
Derivative and Hedging Activi_3
Derivative and Hedging Activities - Additional Information (Details) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) | |
Derivatives Fair Value [Line Items] | ||
Derivatives reclassified from other comprehensive income | $ 0.8 | |
Derivatives reclassified from/to other comprehensive income, estimate of time to transfer | 12 months | |
Fair value of derivatives in net liability | $ 6.1 | $ 6.1 |
Derivative instrument termination value | 6.1 | 6.1 |
Interest Expense | Interest Rate Swaps | ||
Derivatives Fair Value [Line Items] | ||
Loss on change in fair value | $ 0.1 | $ 0.2 |
Derivative and Hedging Activi_4
Derivative and Hedging Activities - Summary of Notional Amount and Fair Value of Instruments (Details) - Derivatives Designated as Hedging Instruments | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Derivatives Fair Value [Line Items] | |
Notional Value | $ 200,000,000 |
Accrued Liabilities and Other Payables | |
Derivatives Fair Value [Line Items] | |
Fair Value of Asset/(Liability) | $ (5,977,000) |
Interest Rate Swap One | |
Derivatives Fair Value [Line Items] | |
Fixed Rate Paid by Company | 2.06% |
Variable Rate Paid by Bank | 1 month LIBOR |
Effective Date | May 14, 2019 |
Maturity Date | Apr. 12, 2024 |
Notional Value | $ 100,000,000 |
Interest Rate Swap One | Accrued Liabilities and Other Payables | |
Derivatives Fair Value [Line Items] | |
Fair Value of Asset/(Liability) | $ (2,985,000) |
Interest Rate Swap Two | |
Derivatives Fair Value [Line Items] | |
Fixed Rate Paid by Company | 2.06% |
Variable Rate Paid by Bank | 1 month LIBOR |
Effective Date | May 14, 2019 |
Maturity Date | Apr. 12, 2024 |
Notional Value | $ 50,000,000 |
Interest Rate Swap Two | Accrued Liabilities and Other Payables | |
Derivatives Fair Value [Line Items] | |
Fair Value of Asset/(Liability) | $ (1,493,000) |
Interest Rate Swap Three | |
Derivatives Fair Value [Line Items] | |
Fixed Rate Paid by Company | 2.07% |
Variable Rate Paid by Bank | 1 month LIBOR |
Effective Date | May 14, 2019 |
Maturity Date | Apr. 12, 2024 |
Notional Value | $ 50,000,000 |
Interest Rate Swap Three | Accrued Liabilities and Other Payables | |
Derivatives Fair Value [Line Items] | |
Fair Value of Asset/(Liability) | $ (1,499,000) |
Secured Borrowings - Additional
Secured Borrowings - Additional Information (Details) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
Jul. 31, 2017USD ($)SpecialPurposeEntity | Dec. 31, 2016USD ($)SpecialPurposeEntity | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | May 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Debt Instrument [Line Items] | ||||||||
Number of special purpose entities formed to hold assets and issue secured borrowings | SpecialPurposeEntity | 3 | 2 | ||||||
Debt instrument, interest rate terms description | If the Company does not meet these repayment schedules, the base interest rates on the notes increase by the greater of (i) 5.00% and (ii) the amount by which the sum of the following exceeds the base interest rates on the notes: (a) the yield to maturity of 10-year U.S. treasury securities in November 2021, plus (b) 5.00%, plus (c) 2.73% for the Series A Notes or 3.70% for the Class B Notes. Additionally, in this event, the full amount of any tenant rental payments received on the assets transferred to the securitization would be used to repay principal. | |||||||
Percentage of increase in base interest rate upon non repayment of schedules | 5.00% | 5.00% | ||||||
Debt instrument, base interest rates | 5.00% | 5.00% | ||||||
Principal outstanding | $ 509.2 | $ 509.2 | $ 515.1 | |||||
Total deferred finance costs, net | 4.9 | 4.9 | $ 9 | |||||
Interest expense recorded from amortization of deferred financing costs | 0.3 | $ 0.6 | 1.3 | $ 1.7 | ||||
Interest expense | $ 3.8 | $ 5.6 | $ 13.3 | $ 16.9 | ||||
U.S. Treasury Securities | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument maturity term upon exceeding base interest rate | 10 years | |||||||
Eldridge Industries, LLC | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes issued | $ 75.1 | |||||||
Series 2016-1 Class A Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, frequency of periodic payment | monthly through November 2021 | |||||||
Debt instrument, base interest rates | 2.73% | 2.73% | ||||||
Series 2016-1 Class A Notes | May 2019 | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal outstanding | $ 310.6 | $ 310.6 | ||||||
Weighted-average interest rate | 4.28% | 4.28% | ||||||
Series 2016-1 Class A Notes | Eldridge Industries, LLC | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes issued | $ 263.5 | |||||||
Debt instrument repurchased, face amount | $ 200 | |||||||
Debt instrument repurchased, amount | $ 201.4 | |||||||
Series 2016-1 Class B Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, base interest rates | 3.70% | 3.70% | ||||||
Series 2016-1 Class B Notes | Eldridge Industries, LLC | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes issued | $ 17.3 | |||||||
Series 2017-1 Class A Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes issued | 232.4 | |||||||
Series 2017-1 Class B Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes issued | $ 15.7 | |||||||
Series 2016-1 Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, payment terms description | The Series 2016-1 Notes mature in November 2046, but the terms of the Class A Notes require principal to be paid monthly through November 2021, with a balloon repayment at that time, and the terms of the Class B Notes require no monthly principal payments but require the full principal balance to be paid in November 2021. | |||||||
Debt instrument maturity month year | 2046-11 | |||||||
Series 2017-1 Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument maturity month year | 2047-06 | |||||||
Debt instrument repurchased, face amount | $ 200 | $ 200 | ||||||
Debt instrument repurchased, amount | $ 201.4 | 201.4 | ||||||
Loss on extinguishment of debt | $ 4.4 |
Secured Borrowings - Summary of
Secured Borrowings - Summary of Scheduled Principal Payments (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Debt Disclosure [Abstract] | |
October 1, 2019 - December 31, 2019 | $ 1,175 |
2020 | 4,844 |
2021 | 73,419 |
2022 | 4,292 |
2023 | 4,512 |
Thereafter | 222,329 |
Total | $ 310,571 |
Notes Payable to Related Part_2
Notes Payable to Related Parties - Additional Information (Details) | Jun. 25, 2018USD ($)Note | Jan. 31, 2018USD ($)Note | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($)Note | Dec. 31, 2018USD ($) |
Related Party Transaction [Line Items] | |||||||
Debt instrument, base interest rates | 5.00% | 5.00% | |||||
Repayment on notes | $ 201,400,000 | ||||||
Interest expense related parties | $ 0 | $ 0 | $ 0 | $ 4,603,000 | |||
Warehouse Notes | |||||||
Related Party Transaction [Line Items] | |||||||
Number of notes issued | Note | 20 | ||||||
Notes issued during the year | $ 154,000,000 | ||||||
Repayment on notes | $ 334,000,000 | $ 50,000,000 | |||||
Number of notes repaid in full | Note | 36 | 3 | |||||
Number of notes repaid in part | Note | 1 | ||||||
Notes issued outstanding amount | $ 0 | $ 0 | $ 0 | ||||
Warehouse Notes | Maximum | |||||||
Related Party Transaction [Line Items] | |||||||
Accrued interest rate maturity period | 1 year | ||||||
Warehouse Notes | Maximum | LIBOR | |||||||
Related Party Transaction [Line Items] | |||||||
Debt instrument, base interest rates | 2.76% | 2.76% | |||||
Warehouse Notes | Eldridge Industries, LLC | Minimum | LIBOR | |||||||
Related Party Transaction [Line Items] | |||||||
Debt instrument, base interest rates | 2.14% | 2.14% |
Equity - Additional Information
Equity - Additional Information (Details) - USD ($) | Jul. 22, 2019 | Mar. 18, 2019 | Jul. 24, 2018 | Jun. 30, 2018 | Jun. 25, 2018 | Jan. 31, 2018 | Dec. 31, 2017 | Jan. 31, 2017 | Aug. 31, 2019 | Jan. 31, 2019 | Jul. 20, 2018 | Sep. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2016 | Dec. 31, 2018 | Jun. 21, 2018 | Jun. 20, 2018 |
Class Of Stock [Line Items] | ||||||||||||||||||||
Proceeds from issuance of common stock, net | $ 309,768,000 | $ 464,182,000 | ||||||||||||||||||
Common shares, issued shares | 79,672,970 | 79,672,970 | 43,749,092 | |||||||||||||||||
Direct capital contributions | $ 288,600,000 | |||||||||||||||||||
Indirect capital contributions | $ 163,100,000 | |||||||||||||||||||
Additional indirect capital contributions | $ 17,300,000 | |||||||||||||||||||
Direct equity contribution | $ 50,000,000 | |||||||||||||||||||
Price per unit | $ 1,000 | |||||||||||||||||||
Compound interest rate percentage | 8.00% | |||||||||||||||||||
Issuance of new grant of unvested shares | 500 | |||||||||||||||||||
Proceeds to repay of outstanding principal | $ 50,000,000 | |||||||||||||||||||
EPRT Holdings LLC | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Direct equity contribution | $ 80,000,000 | |||||||||||||||||||
Interest received in Operating Partnership | 17,913,592 | 17,913,592 | ||||||||||||||||||
EPRT Management and Certain Members of EPRT LLC's Board of Managers | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Direct equity contribution | 3,700,000 | |||||||||||||||||||
Retention of equity investment in subsidiary | $ 91,500,000 | |||||||||||||||||||
ATM program | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Common shares, issued shares | 3,344,805 | 3,344,805 | ||||||||||||||||||
Common stock weighted average price per share | $ 22.42 | $ 22.42 | ||||||||||||||||||
Proceeds from issuance of common stock gross | $ 75,000,000 | $ 75,000,000 | ||||||||||||||||||
Proceeds from issuance of common stock net | $ 73,500,000 | $ 73,500,000 | ||||||||||||||||||
ATM program | Maximum | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Common stock shares authorized, value | $ 200,000,000 | |||||||||||||||||||
Common Stock | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Shares issued | 32,500,000 | 3,344,805 | 14,030,000 | 2,772,191 | ||||||||||||||||
Common stock, price per share | $ 14 | |||||||||||||||||||
Concurrent private placement shares | 7,785,611 | |||||||||||||||||||
Common stock to purchase number of additional shares | 4,875,000 | |||||||||||||||||||
Net proceeds from IPO and concurrent private placement | $ 583,700,000 | |||||||||||||||||||
Common Stock | 2018 Equity Incentive Plan | Directors, Executive Officers and Other Employees | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Restricted shares issued | 691,290 | 46,368 | ||||||||||||||||||
Common Stock | Initial Public Offering | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Shares issued | 2,772,191 | 32,500,000 | ||||||||||||||||||
Common stock, price per share | $ 14 | $ 14 | ||||||||||||||||||
Proceeds from issuance of common stock, net | $ 458,700,000 | |||||||||||||||||||
Common Stock | Over-allotment Option | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Shares issued | 2,772,191 | |||||||||||||||||||
Common Stock | Follow-On Offering | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Shares issued | 14,030,000 | |||||||||||||||||||
Common stock, price per share | $ 17.50 | |||||||||||||||||||
Common stock to purchase number of additional shares | 1,830,000 | |||||||||||||||||||
Proceeds from issuance of common stock, net | $ 234,600,000 | |||||||||||||||||||
Common Stock | Secondary Offering | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Shares issued | 26,288,316 | |||||||||||||||||||
Stock issued during period for options to purchase additional shares | 3,428,910 | |||||||||||||||||||
Eldridge Industries, LLC | Private Placement | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Common stock, price per share | $ 14 | |||||||||||||||||||
Underwriting discounts or commissions | $ 0 | |||||||||||||||||||
Eldridge Industries, LLC | Operating Partnership Unit | Private Placement | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Common stock, price per share | $ 14 | |||||||||||||||||||
Operating partnership units issued | 1,142,960 | |||||||||||||||||||
Eldridge Industries, LLC | Common Stock | Private Placement | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Concurrent private placement shares | 7,785,611 | |||||||||||||||||||
Operating Partnership | Secondary Offering | ||||||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||||||
Operating partnership units converted | 18,502,705 | 18,502,705 |
Equity - Summary of Quarterly C
Equity - Summary of Quarterly Cash Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 06, 2019 | Jun. 05, 2019 | Mar. 08, 2019 | Sep. 30, 2019 | Sep. 30, 2019 |
Dividends Payable [Line Items] | |||||
Dividend per Share of Common Stock | $ 0.22 | $ 0.65 | |||
Common Stock | |||||
Dividends Payable [Line Items] | |||||
Date Declared | Sep. 6, 2019 | Jun. 5, 2019 | Mar. 8, 2019 | ||
Record Date | Sep. 30, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | ||
Date Paid | Oct. 15, 2019 | Jul. 15, 2019 | Apr. 16, 2019 | ||
Dividend per Share of Common Stock | $ 0.22 | $ 0.22 | $ 0.21 | ||
Total Dividend | $ 17,531 | $ 12,725 | $ 12,143 |
Non-controlling Interests - Add
Non-controlling Interests - Additional Information (Details) - $ / shares | Jul. 22, 2019 | Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Minority Interest [Line Items] | ||||
Percentage of ownership interest, excluding general partner ownership interest | 98.30% | 98.30% | ||
Percentage of ownership interests in operating partnership | 98.30% | 98.30% | 69.70% | |
Common stock, conversion basis | one-for-one basis | |||
Total cash dividends per share, common stock | $ 0.22 | $ 0.65 | ||
Operating Partnership Unit | EPRT Holdings LLC | ||||
Minority Interest [Line Items] | ||||
Interest held in operating partnership | 553,847 | 553,847 | ||
Eldridge Industries, LLC | ||||
Minority Interest [Line Items] | ||||
Percentage of ownership interests in operating partnership | 0.70% | 0.70% | ||
Eldridge Industries, LLC | Operating Partnership Unit | ||||
Minority Interest [Line Items] | ||||
Operating partnership units held | 79,672,970 | |||
Secondary Offering | Operating Partnership Unit | ||||
Minority Interest [Line Items] | ||||
Operating partnership units outstanding | 553,847 | 553,847 | ||
Secondary Offering | Operating Partnership | ||||
Minority Interest [Line Items] | ||||
Operating partnership units converted | 18,502,705 | 18,502,705 |
Equity Based Compensation - 201
Equity Based Compensation - 2018 Incentive Award Plan - Additional Information (Details) - 2018 Equity Incentive Plan - shares | Sep. 30, 2019 | Jun. 22, 2018 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Maximum number of shares issuable under plan | 3,550,000 | |
Shares of common stock, reserved for issuance | 3,550,000 |
Equity Based Compensation - Res
Equity Based Compensation - Restricted Stock Awards - Additional Information (Details) - 2018 Equity Incentive Plan - Restricted Stock Awards - shares | Jun. 25, 2018 | Jan. 31, 2019 | Sep. 30, 2019 | Sep. 30, 2018 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Number of unvested shares issued | 46,368 | 691,290 | ||
Directors, Executive Officers and Other Employees | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Number of unvested shares issued | 691,290 | 46,368 | ||
Directors, Executive Officers and Other Employees | Minimum | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting period | 1 year | 1 year | ||
Directors, Executive Officers and Other Employees | Maximum | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting period | 3 years | 4 years |
Equity Based Compensation - Sch
Equity Based Compensation - Schedule of Information about Restricted Stock Awards (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Compensation cost recognized in general and administrative expense | $ 7,530 | $ 3,529 | $ 16,455 | $ 9,872 |
Restricted Stock Awards | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Compensation cost recognized in general and administrative expense | 838 | 823 | 2,584 | 869 |
Dividends declared and charged directly to distributions in excess of cumulative earnings | 108 | $ 155 | 373 | $ 155 |
Fair value of shares vested during the period | $ 60 | $ 3,354 |
Equity Based Compensation - S_2
Equity Based Compensation - Schedule of Information about Unrecognized Compensation Cost Restricted Stock Awards (Details) - Restricted Stock Awards - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Total unrecognized compensation cost | $ 5,836 | $ 7,764 |
Weighted average period over which compensation cost will be recognized (in years) | 1 year 10 months 24 days | 2 years 6 months |
Equity Based Compensation - R_2
Equity Based Compensation - Restricted Share Units - Additional Information (Details) - Restricted Stock Units | 1 Months Ended | 3 Months Ended | 9 Months Ended | |
Jun. 30, 2019shares | Jan. 31, 2019Companyshares | Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Nonvested share awards percentage | 75.00% | |||
Number of peer companies returns compared for calculation of vesting percentages and vesting number of units | Company | 11 | |||
Total Shareholder return calculation basis description | TSR will be calculated based upon the average closing price for the 20-trading day period ending December 31, 2021, divided by the average closing price for the 20-trading day period ended January 1, 2019. The target number of units is based on achieving a TSR equal to the 50th percentile of the peer group. | |||
Nonvested share awards remaining percentage | 25.00% | |||
Compensation expense | $ | $ 0 | $ 0 | ||
Minimum | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting percentage payout schedule can produce | 0.00% | |||
Maximum | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting percentage payout schedule can produce | 250.00% | |||
Executive Officers | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Number of unvested shares issued | 119,085 | |||
Non-employee Directors | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Number of unvested shares issued | 11,500 | |||
Vesting period | 1 year |
Equity Based Compensation - S_3
Equity Based Compensation - Schedule of Assumptions Used in Measurement of Grant Date Fair Value of Total Shareholder Return RSUs Using Monte Carlo Simulation Model (Details) - Restricted Stock Units | 9 Months Ended |
Sep. 30, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Volatility | 18.00% |
Risk free rate | 2.57% |
Equity Based Compensation - S_4
Equity Based Compensation - Schedule of Information about Restricted Stock Units (Details) - Restricted Stock Units - USD ($) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Compensation cost recognized in general and administrative expense | $ 0 | $ 0 |
Dividends declared and charged directly to distributions in excess of cumulative earnings | 2,000 | 5,000 |
General and Administrative Expense | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Compensation cost recognized in general and administrative expense | $ 212,000 | $ 502,000 |
Equity Based Compensation - S_5
Equity Based Compensation - Schedule of Information about Unrecognized Compensation Cost Restricted Stock Units (Details) - Restricted Stock Units $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Total unrecognized compensation cost | $ 1,796 |
Weighted average period over which compensation cost will be recognized (in years) | 2 years 7 months 6 days |
Equity Based Compensation - S_6
Equity Based Compensation - Schedule of Information about Restricted Stock Award and RSU Activity (Details) - 2018 Equity Incentive Plan - $ / shares | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Restricted Stock Units | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unvested restricted stock award and RSU. Granted | 100,814 | |
Unvested restricted stock award and RSU, Ending Balance | 100,814 | |
Unvested restricted common stock, Granted, Weighted average grant date fair value | $ 22.80 | |
Unvested restricted common stock, Weighted average grant date fair value | $ 22.80 | |
Restricted Stock Awards | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unvested restricted stock award and RSU. Beginning Balance | 691,290 | |
Unvested restricted stock award and RSU. Granted | 46,368 | 691,290 |
Unvested restricted stock award and RSU. Vested | (244,957) | |
Unvested restricted stock award and RSU, Ending Balance | 492,701 | 691,290 |
Unvested restricted common stock, Weighted average grant date fair value | $ 13.68 | |
Unvested restricted common stock, Granted, Weighted average grant date fair value | 14.12 | $ 13.68 |
Unvested restricted common stock, Vested, Weighted average grant date fair value | 13.69 | |
Unvested restricted common stock, Weighted average grant date fair value | $ 13.72 | $ 13.68 |
Equity Based Compensation - Uni
Equity Based Compensation - Unit Based Compensation - Additional Information - (Details) | Jul. 22, 2019shares | Dec. 31, 2017Installmentshares | Jan. 31, 2017Installment$ / sharesshares | Sep. 30, 2019shares | Sep. 30, 2018shares | Dec. 31, 2017$ / shares |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of units vested | 7,030 | 2,310 | ||||
Class B Units | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Issuance beginning date of vested units | Mar. 30, 2024 | |||||
Number of units vested | 3,520 | 5,230 | 1,710 | |||
Grant date fair value of common stock awards per share | $ / shares | $ 323.65 | |||||
Class B Units | Non-employees | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Grant date fair value of common stock awards per share | $ / shares | $ 1,280.35 | |||||
Class D Units | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of units vested | 1,200 | 1,800 | 600 | |||
Grant date fair value of common stock awards per share | $ / shares | 152.16 | |||||
Class D Units | Non-employees | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Grant date fair value of common stock awards per share | $ / shares | $ 79.09 | |||||
Restricted Stock Awards | Class B Units | Members of EPRT Management and EPRT LLC's Board of Managers | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of unvested units issued | 8,050 | |||||
Number of vesting installments | Installment | 5 | |||||
Vesting period start date | Mar. 30, 2017 | |||||
Vesting period end date | Mar. 30, 2021 | |||||
Restricted Stock Awards | Class B Units | Additional Member of EPRT Management | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of unvested units issued | 500 | |||||
Number of vesting installments | Installment | 5 | |||||
Vesting period start date | May 1, 2018 | |||||
Vesting period end date | May 1, 2022 | |||||
Restricted Stock Awards | Class D Units | Members of EPRT LLC's Board of Managers and External Unitholders | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of unvested units issued | 3,000 | |||||
Number of vesting installments | Installment | 5 | |||||
Vesting period start date | Mar. 30, 2017 | |||||
Vesting period end date | Mar. 30, 2021 |
Equity Based Compensation - S_7
Equity Based Compensation - Schedule of Information about Class B and Class D Unit Activity (Details) - shares | Jul. 22, 2019 | Dec. 31, 2017 | Sep. 30, 2019 | Sep. 30, 2018 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Unvested units, Beginning balance | 7,030 | 9,340 | ||
Issuance of new grant of unvested shares | 500 | |||
Unvested units, Vested | (7,030) | (2,310) | ||
Unvested units, Ending balance | 9,340 | 7,030 | ||
Class B Units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Unvested units, Beginning balance | 5,230 | 6,940 | ||
Unvested units, Vested | (3,520) | (5,230) | (1,710) | |
Unvested units, Ending balance | 6,940 | 5,230 | ||
Class D Units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Unvested units, Beginning balance | 1,800 | 2,400 | ||
Unvested units, Vested | (1,200) | (1,800) | (600) | |
Unvested units, Ending balance | 2,400 | 1,800 |
Equity Based Compensation - S_8
Equity Based Compensation - Schedule of Information about Class B and Class D Units (Details) - Class B and Class D Units - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Fair value of units vested during the period | $ 1,565 | $ 2,283 | $ 822 | |
General and Administrative Expense | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Compensation cost recognized in general and administrative expense | $ 1,692 | $ 233 | $ 2,130 | $ 529 |
Equity Based Compensation - S_9
Equity Based Compensation - Schedule of Information about Unrecognized Compensation Cost Class B and Class D Units (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Class B Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Total unrecognized compensation cost | $ 1,899 |
Weighted average period over which compensation cost will be recognized (in years) | 2 years 3 months 18 days |
Class D Units | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Total unrecognized compensation cost | $ 231 |
Liability on units granted to non-employees | $ 33 |
Weighted average period over which compensation cost will be recognized (in years) | 2 years 3 months 18 days |
Leases - Scheduled Future Minim
Leases - Scheduled Future Minimum Base Rental Payments due to be Received Under Remaining Non-Cancelable Term of Operating Leases (ASC 842) (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Lessor Operating Lease Payments Fiscal Year Maturity [Abstract] | |
October 1, 2019 - December 31, 2019 | $ 33,305 |
2020 | 133,653 |
2021 | 134,862 |
2022 | 136,697 |
2023 | 137,628 |
Thereafter | 1,568,816 |
Total | $ 2,144,961 |
Leases - Scheduled Future Min_2
Leases - Scheduled Future Minimum Base Rental Payments due to be Received Under Remaining Non-Cancelable Term of Operating Leases (ASC 840) (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Operating Leases Future Minimum Payments Receivable [Abstract] | |
2019 | $ 105,827 |
2020 | 106,082 |
2021 | 106,743 |
2022 | 108,035 |
2023 | 105,924 |
Thereafter | 1,150,158 |
Total | $ 1,682,769 |
Leases - Components of Fixed an
Leases - Components of Fixed and Variable Lease Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Operating Leases Lease Income [Abstract] | ||
Fixed lease revenues | $ 34,758 | $ 96,687 |
Variable lease revenues (1) | 474 | 1,990 |
Total lease revenues (2) | $ 35,232 | $ 98,677 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Jan. 01, 2019 | |
Lessee Lease Description [Line Items] | |||||
Right-of-use asset | $ 3,300 | $ 3,300 | |||
Lease liabilities | 4,198 | 4,198 | |||
Rent expense | 347 | 1,068 | |||
Ground Rent Expense within Property Expenses | |||||
Lessee Lease Description [Line Items] | |||||
Rent expense | $ 100 | $ 400 | |||
Office and Equipment Leases within General and Administrative Expense | |||||
Lessee Lease Description [Line Items] | |||||
Rent expense | $ 100 | $ 100 | |||
Ground Operating Leases | |||||
Lessee Lease Description [Line Items] | |||||
Lease liabilities | $ 33,000 | $ 33,000 | |||
ASU 2016-02 | |||||
Lessee Lease Description [Line Items] | |||||
Right-of-use asset | $ 4,800 | ||||
Lease liabilities | 4,800 | ||||
Accrued Rent Expense Reclassified from Accrued Liabilities and Other Payables | ASU 2016-02 | |||||
Lessee Lease Description [Line Items] | |||||
Right-of-use asset | (100) | ||||
Acquired Above-Market Lease Liabilities, Net, Reclassified from Intangible Lease Liabilities, Net | ASU 2016-02 | |||||
Lessee Lease Description [Line Items] | |||||
Right-of-use asset | (1,200) | ||||
Acquired Below-Market Lease Assets, Net, Reclassified from Intangible Lease Assets, Net | ASU 2016-02 | |||||
Lessee Lease Description [Line Items] | |||||
Right-of-use asset | 100 | ||||
Prepaid Lease Payments | ASU 2016-02 | |||||
Lessee Lease Description [Line Items] | |||||
Right-of-use asset | $ 200 |
Leases - Information Related to
Leases - Information Related to Measurement of Lease Liabilities (Details) | Sep. 30, 2019 |
Leases [Abstract] | |
Weighted average remaining lease term (in years) | 5 years 1 month 6 days |
Weighted average discount rate | 7.00% |
Leases - Details of Rent Expens
Leases - Details of Rent Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Leases [Abstract] | ||
Fixed rent expense | $ 347 | $ 1,068 |
Total rent expense | $ 347 | $ 1,068 |
Leases - Summary of Future Leas
Leases - Summary of Future Lease Payments due from Company Under Ground, Office and Equipment Operating Leases (ASC 842) (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Lessee Lease Description [Line Items] | |
October 1, 2019 - December 31, 2019 | $ 296 |
2020 | 1,091 |
2021 | 1,011 |
2022 | 996 |
2023 | 682 |
Thereafter | 1,093 |
Total | 5,169 |
Present value discount | (971) |
Lease liability | 4,198 |
Office and Ground Leases to be Paid by the Company | |
Lessee Lease Description [Line Items] | |
October 1, 2019 - December 31, 2019 | 215 |
2020 | 763 |
2021 | 680 |
2022 | 669 |
2023 | 656 |
Thereafter | 1,093 |
Total | 4,076 |
Ground Leases to be Paid Directly by the Company's Tenants | |
Lessee Lease Description [Line Items] | |
October 1, 2019 - December 31, 2019 | 81 |
2020 | 328 |
2021 | 331 |
2022 | 327 |
2023 | 26 |
Total | $ 1,093 |
Leases - Summary of Future Le_2
Leases - Summary of Future Lease Payments due from Company Under Ground, Office and Equipment Operating Leases (ASC 840) (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Operating Leased Assets [Line Items] | |
2019 | $ 1,385 |
2020 | 1,087 |
2021 | 1,011 |
2022 | 996 |
2023 | 682 |
Thereafter | 1,093 |
Total | 6,254 |
Office and Ground Leases to be Paid by the Company | |
Operating Leased Assets [Line Items] | |
2019 | 893 |
2020 | 759 |
2021 | 680 |
2022 | 669 |
2023 | 656 |
Thereafter | 1,093 |
Total | 4,750 |
Ground Leases to be Paid Directly by the Company's Tenants | |
Operating Leased Assets [Line Items] | |
2019 | 492 |
2020 | 328 |
2021 | 331 |
2022 | 327 |
2023 | 26 |
Total | $ 1,504 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Commitments and Contingencies [Line Items] | ||||
Reimbursement to tenants | $ 23,500,000 | |||
Executive Officers | ||||
Commitments and Contingencies [Line Items] | ||||
Employment agreement initial term | 4 years | |||
Employment agreement automatic extension period upon non-renewal notice not provided | 1 year | |||
401(k) Plan | ||||
Commitments and Contingencies [Line Items] | ||||
Defined contribution plan name | 401(k) Plan | |||
Employer matching contribution | $ 21,000 | $ 14,000 | $ 100,000 | $ 100,000 |
401(k) Plan | Maximum | ||||
Commitments and Contingencies [Line Items] | ||||
Employer matching contribution, percent of match | 100.00% | |||
Employer matching contribution, percent of eligible compensation | 3.00% | |||
401(k) Plan | Minimum | ||||
Commitments and Contingencies [Line Items] | ||||
Employer matching contribution, percent of match | 50.00% | |||
Employer matching contribution, percent of eligible compensation | 2.00% |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Net deferred financing costs | $ 4.9 | $ 9 |
Carrying Value | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Secured borrowings | 310.6 | 515.1 |
Level 3 | Estimated Fair Value | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Secured borrowings | 321.2 | $ 520.6 |
Level 3 | Estimated Fair Value | Interest Rate Swaps | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Fair Value of Asset/(Liability) | $ 6 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Fair Values of Real Estate Investments Measured at Nonrecurring Basis (Details) - Fair Value Measurements, Nonrecurring $ in Thousands | Dec. 31, 2018USD ($) |
Net Carrying Value | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |
Non-financial long-lived assets | $ 3,238 |
Fair Value | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |
Non-financial long-lived assets | 3,238 |
Fair Value | Level 3 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |
Non-financial long-lived assets | $ 3,238 |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Details) - Series 2016-1 Class A Notes - Eldridge Industries, LLC $ in Millions | May 31, 2019USD ($) |
Related Party Transaction [Line Items] | |
Debt instrument repurchased, face amount | $ 200 |
Debt instrument repurchased, amount | $ 201.4 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Nov. 06, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Subsequent Event [Line Items] | |||
Common stock, issued shares | 79,672,970 | 43,749,092 | |
ATM program | |||
Subsequent Event [Line Items] | |||
Common stock, issued shares | 3,344,805 | ||
Common stock weighted average price per share | $ 22.42 | ||
Proceeds from issuance of common stock gross | $ 75 | ||
ATM program | Subsequent Event | |||
Subsequent Event [Line Items] | |||
Common stock, issued shares | 1,359,739 | ||
Common stock weighted average price per share | $ 24.05 | ||
Proceeds from issuance of common stock gross | $ 32.7 |