UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
(Mark One)
[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 1995
--------------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
------------ -----------
Commission file number 0-12989
COMMERCIAL NET LEASE REALTY, INC.
(Exact name of registrant as specified in its charter)
Maryland 56-1431377
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
400 East South Street, Suite 500
Orlando, Florida 32801
(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code: (407) 422-1574
Securities registered pursuant to Section 12(b) of the Act:
Title of each class: Name of exchange on which registered:
Common Stock, $.01 par value New York Stock Exchange
Securities registered pursuant to section 12(g) of the Act:
None
(Title of class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days: Yes X No
----------- -----------
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
The aggregate market value of voting stock held by non-affiliates of the
registrant as of March 22, 1996, was $198,624,602.
The number of shares of common stock outstanding as of March 22, 1996,
was 15,688,672.
DOCUMENTS INCORPORATED BY REFERENCE:
1. Registrant incorporates by reference portions of the Commercial
Net Lease Realty, Inc. Annual Report to Shareholders for the year ended
December 31, 1995 (Items 5, 6, 7 and 8 of Part II).
2. Registrant incorporates by reference portions of the Commercial
Net Lease Realty, Inc. Proxy Statement for the 1996 Annual Meeting of
Shareholders (Items 10, 11, 12 and 13 of Part III).
PART I
ITEM 1. BUSINESS
Commercial Net Lease Realty, Inc. (the "Registrant" or the "Company") is
a real estate investment trust (a "REIT") which was incorporated in 1984 in
the State of Delaware. In June 1994, the Company reincorporated in the State
of Maryland. The Company acquires, owns and manages a diversified portfolio
of high-quality, freestanding properties leased to major retail businesses
under long-term commercial net leases.
The Company's strategy is to invest in single-tenant, freestanding
retail properties with purchase prices of generally up to $5 million, which
typically are located along intensive commercial corridors near traffic
generators, such as regional malls, business developments and major
thoroughfares. Management believes that these types of properties when leased
to high-quality tenants with significant market presence provide attractive
opportunities for a stable current return and the potential for capital
appreciation. In management's view, these types of properties also provide
the Company with flexibility in use and tenant selection when the Properties
are re-let upon lease expiration.
The Company will hold its properties until it determines that the sale
or other disposition of the properties is advantageous in view of the
Company's investment objectives. In deciding whether to sell properties, the
Company will consider factors such as potential capital appreciation, net cash
flow and federal income tax considerations.
Properties
During the year ended December 31, 1995, the Company borrowed
$67,400,000 of amounts it has available under its credit facility to acquire
29 properties and four buildings which were developed by the tenant on land
parcels owned by the Company. As of December 31, 1995, the Company owned 157
properties (the "Properties") that are leased to major businesses, including
Academy, Barnes & Noble, Best Buy, Blockbuster Music, Borders, Burger King,
Checkers, CompUSA, Computer City, Denny's, Eckerd, Food 4 Less, Food Lion,
Golden Corral, Good Guys, Hardee's, Hi-Lo Automotive, International House of
Pancakes, Levitz, Linens 'n Things, Marshalls, Office Depot, OfficeMax,
Oshmans, Pier 1 Imports, Pizza Hut, Scotty's, Sears, Waccamaw and Wendy's.
The occupancy rate of the Company's Property portfolio was 100 percent at
December 31, 1995.
All of the Properties are leased under net leases pursuant to which the
tenant typically will bear responsibility for substantially all property costs
and expenses associated with ongoing maintenance and operation. The lease of
each of the Company's Properties require payment of annual base rent plus,
generally, either percentage rent based on the tenant's gross sales or
contractual increases in annual rent.
During 1995, two of the Company's lessees (or group of affiliated
lessees), (i) Barnes & Noble Superstores, Inc. and (ii) Denny's, Inc. and
Flagstar Enterprises, Inc. (which are affiliated entities under common
control) (hereinafter referred to as Flagstar), each accounted for more than
ten percent of the Company's total rental income. As of December 31, 1995,
Barnes & Noble Superstores, Inc. was the lessee under leases relating to nine
Properties and Flagstar was the lessee under leases relating to 24 Properties.
It is anticipated that, based on the minimum rental payments required by the
leases and estimated contingent rental income, Barnes & Noble Superstores,
Inc. will continue to account for more than ten percent of the Company's total
rental income in 1996. Any failure of this lessee could materially affect the
Company's income.
Investment in Subsidiaries
In November 1995, the Company purchased 100% of the common stock of two
newly-formed entities, Net Lease Realty I, Inc. and Net Lease Realty II, Inc.
to facilitate the acquisition of certain properties. Each of the wholly-owned
subsidiaries is a qualified real estate investment trust subsidiary as defined
under Internal Revenue Code Section 856(i)(2).
Advisory Services
The Company and CNL Realty Advisors, Inc. have entered into an advisory
agreement (the "Advisory Agreement"), which provides for CNL Realty Advisors,
Inc. to receive an annual fee, payable monthly, equal to seven percent of
funds from operations, as defined in the Advisory Agreement, up to
$10,000,000, six percent of funds from operations in excess of $10,000,000 but
less than $20,000,000 and five percent of funds from operations in excess of
$20,000,000. Under the Advisory Agreement, CNL Realty Advisors, Inc.
generally is responsible for administering the day-to-day investment
operations of the Company, including investment analysis and development,
acquisitions, due diligence, and asset management and accounting services.
These duties include collecting rental payments, inspecting and managing the
Properties, assisting the Company in responding to tenant inquiries and
notices, providing information to the Company about the status of the leases
and the Properties, maintaining the Company's accounting books and records,
and preparing and filing various reports, returns or statements with various
regulatory agencies. In addition, CNL Realty Advisors, Inc. serves as the
Company's consultant in connection with policy decisions to be made by the
Board of Directors, manages the Company's Properties and renders other
services as the Board of Directors deems appropriate. CNL Realty Advisors,
Inc. is subject to the supervision of the Company's Board of Directors and has
only such functions as are delegated to it.
The Advisory Agreement was renewed January 1, 1996 and continues until
January 1997, and thereafter may be extended annually upon mutual consent of a
majority of the board of directors of CNL Realty Advisors, Inc. and a majority
of the independent directors of the Company unless terminated at an earlier
date upon 90 days' prior notice by either party.
Competition
The Company generally competes with other REITs, real estate limited
partnerships and other investors, including but not limited to, insurance
companies, pension funds and financial institutions, in the acquisition,
leasing, financing and disposition of investments in net-leased retail
properties.
Employees
Reference is made to Item 10. Directors and Executive Officers of the
Registrant for a listing of the Company's Executive Officers. The Company has
no other employees.
ITEM 2. PROPERTIES
As of December 31, 1995, the Company owned 157 Properties located in 26
states. Reference is made to the Schedule of Real Estate and Accumulated
Depreciation filed with this Report for a listing of the Properties and their
respective costs.
Description of Properties
Land. The Company's Property sites range from approximately 12,000 to
286,000 square feet depending upon building size and local demographic
factors. Sites purchased by the Company are in locations zoned for commercial
use which have been reviewed for traffic patterns and volume. Land costs
range from approximately $36,500 to $3,570,000.
Buildings. The buildings generally are rectangular and are constructed
from various combinations of stucco, steel, wood, brick and tile. Building
sizes range from approximately 1,000 to 56,000 square feet. Building costs
range from approximately $195,000 to $6,062,000 for each Property, depending
upon the size of the building and the site and the area in which the Property
is located. Generally, the Properties owned by the Company are freestanding,
with paved parking areas.
Leases. Although there are variations in the specific terms of the
leases, the following is a summarized description of the general structure of
the Company's leases. Generally, the leases of the Properties owned by the
Company provide for initial terms of 15 to 20 years. As of December 31, 1995,
the average remaining lease term was approximately 14 years. All of the
Properties are leased under net leases pursuant to which the tenant typically
will bear responsibility for substantially all property costs and expenses
associated with ongoing maintenance and operation, including utilities,
property taxes and insurance. In addition, the majority of the Company's
leases provide that the tenant is responsible for roof and structural repairs.
The leases of the Properties provide for annual base rental payments (payable
in monthly installments) ranging from $23,952 to $910,132. Generally, the
leases provide for either percentage rent or contractual increases in annual
rent. Leases which provide for contractual increases in annual rent generally
have increases which range from six to 12 percent after every five years of
the lease term. In addition, for those leases which provide for the payment
of percentage rent, such rent is generally one to eight percent of the
tenants' annual gross sales, less the amount of annual base rent payable in
that lease year. As of December 31, 1995, leases representing approximately
68 percent of annual base rent include contractual increases, leases
representing approximately 44 percent of annual base rent include percentage
rent provisions and leases representing approximately 23 percent of annual
base rent include both contractual and percentage rent provisions.
Generally, the leases of the Properties provide for two, three or four
five-year renewal options subject to the same terms and conditions as the
initial lease. Some of the leases also provide that, in the event the Company
wishes to sell the Property subject to that lease, the Company first must
offer the lessee the right to purchase the Property on the same terms and
conditions, and for the same price, as any offer which the Company has
received for the sale of the Property.
The Company is not aware of any environmental liability with respect to
any of the Properties in the Company Portfolio that it believes would have a
material adverse effect on the Company's assets or financial condition.
The Company's principal executive offices are located at 400 E. South
Street, Suite 500, Orlando, Florida 32801, where it occupies office space
provided to it free of charge by CNL Realty Advisors, Inc., the Company's
advisor.
ITEM 3. LEGAL PROCEEDINGS
The Company is a defendant in a law suit filed on October 26, 1994, in
the Circuit Court, Hamilton County, Tennessee, whereby the plaintiff is
alleging that a flooding problem on the property adjacent to the Company's
Property in Chattanooga, Tennessee, is a result of the construction of the
building and parking lot on the Company's Property and is seeking damages of
$400,000. Management intends to vigorously contest these claims and believes
that, if the Company were to be held liable for any damages, such damages
would be covered by insurance.
The Company is also a defendant in a law suit filed on December 20,
1994, in the Circuit Court, Knox County, Tennessee, and in the Circuit Court,
Greene County, Tennessee, by the surviving spouse of a patron of the Company's
Property in Tusculum, Tennessee. The plaintiff is alleging that the Company
was negligent in the design and control of the parking lot on the Company's
Property and is seeking damages of $2,500,000. Management intends to
vigorously contest these claims and to seek full indemnification from the
tenant. Management believes that, if the Company were to be held liable for
any damages, such damages would be covered by insurance.
The Company is not a party to any other pending legal proceedings which,
in the opinion of the Company and its general counsel, is likely to have a
material adverse effect upon the Company's business or financial condition.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Information responsive to this Item is contained in the section
captioned "Share Price and Dividend Data" on page 21 of the Registrant's
Annual Report to Shareholders for the year ended December 31, 1995; the
information in such section is filed as an exhibit to this report and the
cited portion of which is incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA
Information responsive to this Item is contained in the section
captioned "Historical Financial Highlights" on page one of the Registrant's
Annual Report to Shareholders for the year ended December 31, 1995; the
information in such section is filed as an exhibit to this report and the
cited portion of which is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Information responsive to this Item is contained in the section
captioned "Management's Discussion and Analysis of Financial Condition and
Results of Operations" on pages six through nine of the Registrant's Annual
Report to Shareholders for the year ended December 31, 1995; the information
in such section is filed as an exhibit to this report and the cited portion of
which is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Certain information responsive to this Item is contained in the section
captioned "Quarterly Financial Data" on page 21 of the Registrant's Annual
Report to Shareholders for the year ended December 31, 1995; the information
in such section is filed as an exhibit to this report and the cited portion of
which is incorporated herein by reference. The financial statements of the
Registrant, together with the report thereon of KPMG Peat Marwick LLP,
appearing in the Annual Report to Shareholders for the year ended December 31,
1995, are incorporated herein by reference.
ITEM 9. DISAGREEMENTS OF ACCOUNTING AND FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Reference is made to the Registrant's definitive proxy statement which
was filed with the Commission on March 28, 1996, pursuant to Regulation 14(a);
information responsive to this Item is contained in the sections thereof
captioned "Proposal I: Election of Directors - Nominees" and "Proposal I:
Election of Directors - Executive Officers" and "Security Ownership," and the
information in such sections is incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
Reference is made to the Registrant's definitive proxy statement which
was filed with the Commission on March 28, 1996, pursuant to Regulation 14(a);
information responsive to this Item is contained in the section thereof
captioned "Proposal I: Election of Directors - Compensation of Directors" and
"Proposal I: Executive Compensation," and the information in such sections is
incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Reference is made to the Registrant's definitive proxy statement which
was filed with the Commission on March 28, 1996, pursuant to Regulation 14(a);
information responsive to this Item is contained in the section thereof
captioned "Security Ownership," and the information in such section is
incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Reference is made to the Registrant's definitive proxy statement which
was filed with the Commission on March 28, 1996, pursuant to Regulation 14(a);
information responsive to this Item is contained in the section thereof
captioned "Certain Transactions," and the information in such section is
incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) The following documents are filed as part of this report.
1. Financial Statements
Report of Independent Auditors
Consolidated Balance Sheets at December 31, 1995 and 1994
Consolidated Statements of Earnings for the years ended December 31,
1995, 1994 and 1993
Consolidated Statements of Stockholders' Equity for the years ended
December 31, 1995, 1994 and 1993
Consolidated Statements of Cash Flows for the years ended December 31,
1995, 1994 and 1993
Notes to Consolidated Financial Statements
2. Financial Statement Schedule
Report of Independent Auditors
Schedule III - Real Estate and Accumulated Depreciation at
December 31, 1995
Notes to Schedule III - Real Estate and Accumulated Depreciation at
December 31, 1995
All other schedules are omitted because they are not applicable or
because the required information is shown in the financial
statements or the notes thereto.
3. Exhibits
3.1 Articles of Incorporation of the Registrant (filed as Exhibit
3.3(i) to the Registrant's Registration Statement No. 1-11290 on
Form 8-B, and incorporated herein by reference).
3.2 Bylaws of the Registrant, (filed as Exhibit 3(ii) to Amendment No.
2 to the Registrant's Registration No. 33-83110 on Form S-3, and
incorporated herein by reference).
4 Specimen Certificate of Common Stock, par value $.01 per share, of
the Registrant (filed as Exhibit 3.4 to the Registrant's
Registration Statement No. 1-11290 on Form 8-B and incorporated
herein by reference).
10.1 Stock Purchase Agreement dated as of January 23, 1992 by and among
the Registrant, CNL Group, Inc. and certain entities affiliated
therewith (filed as Exhibit 10.4 to the Registrant's Annual Report
on Form 10-K for the year ended December 31, 1991, and
incorporated herein by reference).
10.2 Letter Agreement dated July 10, 1992, amending Stock Purchase
Agreement dated January 23, 1992 (filed as Exhibit 10.34 to the
Registrant's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1992, and incorporated herein by reference).
10.3 Form of Advisory Agreement between the Registrant and CNL Realty
Advisors, Inc. (filed as Exhibit 10.21 to the Registrant's Report
on Form 8 dated April 29, 1992, amending its Annual Report on Form
10-K for the year ended December 31, 1991, and incorporated herein
by reference).
10.4 Advisory Agreement between Registrant and CNL Realty Advisors,
Inc. effective as of April 1, 1993 and renewed January 1, 1995
(filed as Exhibit 10.04 to Amendment No. 1 to the Registrant's
Registration Statement No. 33-61214 on Form S-2, and incorporated
herein by reference).
10.5 Revolving Line of Credit and Security Agreement, dated as of July
25, 1994, among Registrant, certain lenders listed therein and
First Union National Bank of Florida, as the Agent, relating to a
$100,000,000 loan (filed as Exhibit 10.11 to the Registrant's
Quarterly Report on Form 10-Q for the quarter ended June 30, 1994,
and incorporated herein by reference).
10.6 1992 Commercial Net Lease Realty, Inc. Stock Option Plan (filed as
Exhibit No. 10(x) to the Registrant's Registration Statement No.
33-83110 on Form S-3, and incorporated herein by reference).
10.7 Interest Rate Cap Agreement dated February 28, 1994, by and
between the Registrant and First Union National Bank of North
Carolina (filed as Exhibit No. 10(xi) to the Registrant's
Registration Statement No. 33-83110 on Form S-3, and incorporated
herein by reference).
10.8 Interest Rate Cap Agreement dated December 23, 1994, by and
between the Registrant and First Union National Bank of Florida
(filed as Exhibit 10.12 to the Registrant's Annual Report on Form
10-K for the year ended December 31, 1994, and incorporated by
reference).
10.9 Second Amended and Restated Line of Credit and Security Agreement,
dated December 7, 1995, among Registrant, certain lenders listed
therein and First Union National Bank of Florida, as the Agent
relating to a $100,000,000 loan (filed as Exhibit 10.14 to the
Registrant's Current Report on Form 8-K dated January 18, 1996,
and incorporated herein by reference).
10.10 Secured Promissory Note, dated December 14, 1995, among Registrant
and Principal Mutual Life Insurance Company relating to a
$13,150,000 loan (filed as Exhibit 10.15 to the Registrant's
Current Report on Form 8-K dated January 18, 1996, and
incorporated herein by reference).
10.11 Mortgage and Security Agreement, dated December 14, 1995, among
Registrant and Principal Mutual Life Insurance Company relating to
a $13,150,000 loan (filed as Exhibit 10.16 to the Registrant's
Current Report on Form 8-K dated January 18, 1996, and
incorporated herein by reference).
10.12 Loan Agreement, dated January 19, 1996, among Registrant and
Principal Mutual Life Insurance Company relating to a $39,450,000
loan. Filed herewith.
10.13 Secured Promissory Note, dated January 19, 1996, among Registrant
and Principal Mutual Life Insurance Company relating to a
$39,450,000 loan. Filed herewith.
13 Annual Report to Shareholders for the year ended December 31, 1995
("filed" only to the extent material therefrom is specifically
incorporated herein by reference).
23 Consent of Independent Accountants dated March 22, 1996. Filed
herewith.
(b) The Registrant filed no reports on Form 8-K during the period from
October 1, 1995 through December 31, 1995.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, on the 29th day
of March, 1996.
COMMERCIAL NET LEASE REALTY, INC.
By: /s/ James M. Seneff, Jr.
----------------------------------
JAMES M. SENEFF, JR.
Chairman of the Board of Directors
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ James M. Seneff, Jr. Chairman of the Board of March 29, 1996
- ------------------------- Directors Chief
James M. Seneff, Jr. Executive Officer
(Principal Executive
Officer)
/s/ Robert A. Bourne Vice Chairman of the March 29, 1996
- ------------------------- Board of Directors,
Robert A. Bourne Secretary and Treasurer
/s/ Edward Clark Director March 29, 1996
- -------------------------
Edward Clark
/s/ Willoughby T. Cox, Jr. Director March 29, 1996
- -------------------------
Willoughby T. Cox, Jr.
/s/ Clifford R. Hinkle Director March 29, 1996
- -------------------------
Clifford R. Hinkle
/s/ Ted B. Lanier Director March 29, 1996
- -------------------------
Ted B. Lanier
/s/ Gary M. Ralston President March 29, 1996
- -------------------------
Gary M. Ralston
/s/ Kevin B. Habicht Chief Financial Officer March 29, 1996
- ------------------------- (Principal Financial and
Kevin B. Habicht Accounting Officer)
REPORT OF INDEPENDENT AUDITOR'S ON SUPPLEMENTARY INFORMATION
----------------------------------------------------------------
The Board of Directors
Commercial Net Lease Realty, Inc.:
Under date of January 20, 1996, except for Note 13 for which the date is
January 30, 1996, we reported on the balance sheets of Commercial Net Lease
Realty, Inc. as of December 31, 1995 and 1994, and the related statements of
earnings, stockholders' equity and cash flows for each of the years in the
three-year period ended December 31, 1995, as contained in Item 14(a)1 of Form
10-K and in the 1995 annual report to stockholders. These financial
statements and our report thereon are both included in Item 14(a)1 of Form 10-
K for the year 1995. In connection with our audits of the aforementioned
financial statements, we also audited the related financial statement schedule
as of December 31, 1995. This financial statement schedule is the
responsibility of the Company's management. Our responsibility is to express
an opinion on this financial statement schedule based on our audits.
In our opinion, such financial statement schedule, when considered in relation
to the basic financial statements taken as a whole, presents fairly, in all
material respects, the information set forth herein.
/s/KPMG Peat Marwick LLP
Orlando, Florida
January 20, 1996, except for Note 13
for which the date is January 30, 1996
COMMERCIAL NET LEASE REALTY, INC.
SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
-------------------------------------------------------
December 31, 1995
(A) (B) (C) (D) (E)
Costs Capitalized
Initial Cost Subsequent
To Company To Acquisition
------------------------ ------------------
Buildings
Encum- and Improve- Carrying
brances Land Improvements ments Costs
------- ----------- ------------ -------- --------
Properties the Company
has Invested in Under
Operating Leases:
Academy:
Houston, TX - $ 1,074,232 $ - $ - $ -
Houston, TX - 699,165 - - -
N. Richland
Hills, TX - 1,286,220 - - -
Barnes & Noble:
Lakeland, FL - 1,069,721 1,586,218 - -
Brandon, FL - 1,474,921 1,605,896 - -
Denver, CO - 3,242,338 2,720,034 - -
Houston, TX - 3,307,562 2,396,024 - -
Plantation, FL - 3,570,000 - - -
Cary, NC - 2,754,000 - - -
Lafayette, LA - 1,122,000 - - -
Oklahoma City, OK - 1,662,090 - - -
Daytona, FL - 2,540,511 - - -
Best Buy:
Corpus Christi, TX - 818,448 896,395 - -
Blockbuster Music:
Dallas, TX - 346,548 1,963,773 27,762 -
Borders:
Wilmington, DE - 3,030,769 6,061,538 - -
Richmond, VA - 2,177,310 2,599,587 - -
Burger King
Restaurants:
Asheboro, NC - 420,508 815,190 - -
Galliano, LA - 249,001 1,130,506 - -
John's Island, SC - 385,517 698,309 - -
Lake Charles, LA - 272,381 965,713 - -
Lancaster, OH - 220,846 582,815 - -
Natchez, MS - 206,717 653,530 - -
Tappahannock, VA - 289,840 572,779 - -
Warren, MI - 298,817 785,031 - -
Manchester, NH - 619,037 428,757 - -
Rochester, NH - 216,652 779,450 - -
St. Paul, MN - 225,297 542,847 - -
Columbus, OH - 357,114 407,093 - -
Opelousas, LA - 460,374 824,510 - -
Coon Rapids, MI - 322,658 544,936 - -
Checkers Restaurant:
Orlando, FL - 256,568 - - -
CompUSA:
Mission Viejo, CA - 2,706,352 1,368,966 - -
Computer City:
Miami, FL - 2,713,192 1,866,676 - -
Baton Rouge, LA - 606,715 910,072 - -
Denny's Restaurants:
Greenville, SC - 344,817 400,895 - -
Landrum, SC - 155,429 - - -
Mooresville, NC - 307,299 - - -
Greensboro, NC - 265,915 493,407 - -
Houston, TX - 289,036 572,985 - -
Santee, SC - 244,284 312,045 - -
Duncan, SC - 219,703 - - -
Topeka, KS - 414,686 - - -
Winter Springs, FL - 555,232 - - -
Eckerd:
San Antonio, TX - 440,985 - - -
Dallas, TX - 541,493 - - -
Garland, TX - 239,014 - - -
Arlington, TX - 368,964 - - -
Millville, NJ - 417,603 - - -
Atlanta, GA - 445,593 - - -
Mantua, NJ - 344,022 - - -
Amarillo, TX - 641,439 - - -
Amarillo, TX - 322,200 - - -
Glassboro, NJ - 534,243 - - -
Kissimmee, FL - 718,484 - - -
Colleyville, TX - 755,647 - - -
Tampa, FL - 604,682 - - -
Food 4 Less:
Lemon Grove, CA - 3,454,917 - - -
Golden Corral Family
Steakhouse
Restaurants:
Foley, AL (e) - 101,286 283,991 - -
Edenton, NC - 36,578 318,481 - -
Woodstock, GA - 200,680 328,450 - -
Bonham, TX (e) - 128,451 344,170 - -
Center, TX (e) - 103,187 308,859 - -
Gilmer, TX (e) - 116,815 296,454 - -
Leitchfield,
KY (e) - 73,660 306,642 - -
Marietta, GA (g) - 156,190 346,509 - -
Rockledge, FL - 120,593 340,889 - -
Silsbee, TX (e) - 132,802 302,052 - -
Atlanta, TX - 88,457 368,317 - -
Vernon, TX (e) - 105,798 328,943 - -
Abbeville, LA - 98,577 362,416 - -
Fredericksburg,
TX - 169,984 321,189 - -
Gonzales, TX (e) - 104,833 312,872 - -
Bowie, TX (e) - 57,824 311,544 - -
Clanton, AL (e) - 113,017 296,921 - -
Jacksonville, TX - 115,276 318,196 - -
Lake Placid,
FL (e) - 115,113 305,074 - -
Pleasanton, TX - 139,694 316,070 - -
Marble Falls,
TX (e) - 151,985 338,704 - -
Ennis, TX - 153,700 366,639 - -
Franklin, LA (e) - 105,839 396,831 - -
Melbourne, FL - 193,447 341,351 - -
Franklin, VA - 100,808 424,164 - -
Minden, LA (e) - 86,120 402,364 - -
Durant, OK - 140,862 411,135 - -
Hardee's Restaurants:
Chalkville, AL - 170,834 457,167 - -
Gulf Shores, AL - 348,281 595,164 - -
Mobile, AL - 336,696 - - -
Warrior, AL - 177,659 - - -
Horn Lake, MS - 302,787 - - -
Petal, MS - 277,104 415,193 - -
West Point, MS - 173,386 - - -
Rock Hill, SC - 216,777 466,450 - -
Columbia, TN - 226,300 - - -
Johnson City, TN - 215,567 - - -
Tusculum, TN - 182,349 507,293 - -
Hi-Lo Automotive:
Mesquite, TX - 233,420 513,523 - -
Fort Worth, TX - 197,037 512,296 - -
Houston, TX - 261,318 531,968 - -
Arlington, TX - 295,331 571,609 - -
Garland, TX - 239,570 512,023 - -
Dallas, TX - 281,347 543,937 - -
McAllen, TX - 265,177 605,397 - -
Temple, TX - 177,451 587,755 - -
San Antonio, TX - 200,510 643,741 - -
Universal City, TX - 247,264 570,677 - -
Bastrop, TX - 197,905 383,144 - -
Lake Worth, TX - 252,141 539,510 - -
Nacogdoches, TX - 190,324 522,232 - -
Eagle Pass, TX - 256,745 455,841 - -
International House
of Pancakes
Restaurants:
Stafford, TX - 382,084 - - -
Sunset Hills, MO - 271,853 - - -
Las Vegas, NV - 519,947 - - -
Fort Worth, TX - 430,896 - - -
Arlington, TX - 404,512 - - -
Matthews, NC - 380,043 - - -
Phoenix, AZ - 483,374 - - -
Linens 'n Things:
Freehold, NJ - 1,753,766 2,208,651 - -
Marshalls:
Freehold, NJ - 2,052,946 2,585,432 - -
Office Depot:
Arlington, TX - 596,024 1,411,432 - -
OfficeMax:
Corpus Christi, TX - 893,270 978,344 76,664 -
Dallas, TX - 1,118,500 1,709,891 - -
Cincinnati, OH - 543,489 1,574,551 - -
Evanston, IL - 1,867,831 1,757,618 - -
Pier 1 Imports:
Dallas, TX - 189,010 1,071,054 14,448 -
Pizza Hut Restaurant:
Orlando, FL - 220,632 258,483 - -
Rally's Restaurant:
Toledo, OH - 125,882 319,770 - -
Scotty's:
Orlando, FL - 1,064,260 2,049,431 - -
Orlando, FL - 1,187,730 2,131,807 - -
Sears Homelife
Centers:
Orlando, FL - 820,397 2,184,721 - -
Clearwater, FL - 1,184,438 2,526,207 - -
Oshmans:
Dallas, TX - 1,311,440 - - -
Waccamaw:
Fairfax, VA - 2,156,801 - - -
Wendy's Old Fashioned
Hamburger Restau-
rants:
Fenton, MO - 307,068 496,410 - -
Longwood, FL - 333,335 194,926 - -
----------- ----------- -------- --------
$83,363,492 $77,978,852 $118,874 $ -
=========== =========== ======== ========
Properties the Company
has Invested in Under
Direct Financing
Leases:
Academy:
Houston, TX - $ - $ 1,924,740 $ - $ -
Houston, TX - - 1,867,519 - -
Checkers Restaurant:
Orlando, FL - - 286,910 - -
Denny's Restaurants:
Landrum, SC - - 374,684 - -
Mooresville, NC - - 535,309 - -
Akron, OH - 137,424 733,450 - -
Duncan, SC - - 628,571 - -
Topeka, KS - - 498,921 - -
Winter Springs, FL - - 620,148 - -
Eckerd:
San Antonio, TX - - 783,974 - -
Dallas, TX - - 638,684 - -
Garland, TX - - 710,634 - -
Arlington, TX - - 636,070 - -
Millville, NJ - - 828,942 - -
Atlanta, GA - - 668,390 - -
Mantua, NJ - - 951,795 - -
Vineland, NJ - 286,231 1,063,142 - -
Amarillo, TX - - 857,250 - -
Amarillo, TX - 153,406 826,030 - -
Amarillo, TX - - 830,937 - -
Glassboro, NJ - - 887,497 - -
Kissimmee, FL - - 937,772 - -
Alice, TX - 189,126 804,703 - -
Colleyville, TX - - 1,074,893 - -
Tampa, FL - - 1,090,532 - -
Food Lion Super-
markets:
Keystone Heights,
FL - 88,604 1,845,988 - -
Chattanooga, TN - 336,488 1,701,072 - -
Lynchburg, VA - 128,216 1,674,167 - -
Martinsburg, WV - 448,648 1,543,573 - -
Good Guys:
Stockton, CA - 580,609 2,974,868 - -
Hardee's Restaurants:
Mobile, AL - - 479,107 - -
Warrior, AL - - 470,556 - -
Horn Lake, MS - - 555,975 - -
Iuka, MS - 130,258 505,363 - -
West Point, MS - - 517,424 - -
Biscoe, NC - 60,301 479,984 - -
Aynor, SC - 44,871 521,192 - -
Columbia, TN - - 584,927 - -
Johnson City, TN - - 570,690 - -
Hi-Lo Automotive:
Edinberg, TX - 97,056 418,926 - -
Copperas Cove, TX - 116,637 476,331 - -
Baton Rouge, LA - 89,954 508,146 - -
Lake Jackson, TX - 120,313 609,300 - -
Fort Worth, TX - 92,779 607,971 - -
Pantego, TX - 154,368 505,323 - -
Fort Worth, TX - 91,373 548,238 - -
Pharr, TX - 94,576 472,880 - -
Baton Rouge, LA - 122,349 527,930 - -
Houston, TX - 37,508 596,069 - -
International House
of Pancakes
Restaurants:
Stafford, TX - - 571,832 - -
Sunset Hills, MO - - 736,345 - -
Las Vegas, NV - - 613,582 - -
Fort Worth, TX - - 623,641 - -
Arlington, TX - - 608,132 - -
Matthews, NC - - 655,668 - -
Phoenix, AZ - - 559,307 - -
Levitz:
Tempe, AZ - 634,444 2,225,991 - -
Oshmans:
Dallas, TX - - 2,658,976 - -
Waccamaw:
Fairfax, VA - - 3,356,493 - -
----------- ----------- -------- --------
$ 4,235,539 $53,367,464 $ - $ -
=========== =========== ======== ========
COMMERCIAL NET LEASE REALTY, INC.
SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
-------------------------------------------------------------------
December 31, 1995
(F) (G) (H) (I)
Gross Amount at Which Carried
at Close of Period (b)
-------------------------------------
Buildings
and Accumulated
Land Improvements Total Depreciation
----------- ------------ ------------ ------------
Properties the Company
has Invested in Under
Operating Leases:
Academy:
Houston, TX $ 1,074,232 (c) $ 1,074,232 $ -
Houston, TX 699,165 (c) 699,165 -
N. Richland
Hills, TX 1,286,220 (f) 1,286,220 -
Barnes & Noble:
Lakeland, FL 1,069,721 $ 1,586,218 2,655,939 36,884
Brandon, FL 1,474,921 1,605,896 3,080,817 37,341
Denver, CO 3,242,338 2,720,034 5,962,372 85,190
Houston, TX 3,307,562 2,396,024 5,703,586 14,983
Plantation, FL 3,570,000 (f) 3,570,000 -
Cary, NC 2,754,000 (f) 2,754,000 -
Lafayette, LA 1,122,000 (f) 1,122,000 -
Oklahoma City, OK 1,662,090 (f) 1,662,090 -
Daytona, FL 2,540,511 (f) 2,540,511 -
Best Buy:
Corpus Christi, TX 818,448 896,395 1,714,843 47,521
Blockbuster Music:
Dallas, TX 346,548 1,991,535 2,338,083 86,358
Borders:
Wilmington, DE 3,030,769 6,061,538 9,092,307 155,612
Richmond, VA 2,177,310 2,599,587 4,776,897 36,465
Burger King
Restaurants:
Asheboro, NC 420,508 815,190 1,235,698 71,329
Galliano, LA 249,001 1,130,506 1,379,507 98,919
John's Island, SC 385,517 698,309 1,083,826 61,102
Lake Charles, LA 272,381 965,713 1,238,094 84,500
Lancaster, OH 220,846 582,815 803,661 50,996
Natchez, MS 206,717 653,530 860,247 57,184
Tappahannock, VA 289,840 572,779 862,619 50,118
Warren, MI 298,817 785,031 1,083,848 68,690
Manchester, NH 619,037 428,757 1,047,794 27,796
Rochester, NH 216,652 779,450 996,102 50,531
St. Paul, MN 225,297 542,847 768,144 33,965
Columbus, OH 357,114 407,093 764,207 25,471
Opelousas, LA 460,374 824,510 1,284,884 51,588
Coon Rapids, MI 322,658 544,936 867,594 34,096
Checkers Restaurant:
Orlando, FL 256,568 (c) 256,568 -
CompUSA:
Mission Viejo, CA 2,706,352 1,368,966 4,075,318 19,962
Computer City:
Miami, FL 2,713,192 1,866,676 4,579,868 79,462
Baton Rouge, LA 606,715 910,072 1,516,787 61
Denny's Restaurants:
Greenville, SC 344,817 400,895 745,712 25,990
Landrum, SC 155,429 (c) 155,429 -
Mooresville, NC 307,299 (c) 307,299 -
Greensboro, NC 265,915 493,407 759,322 31,987
Houston, TX 289,036 572,985 862,021 37,146
Santee, SC 244,284 312,045 556,329 20,229
Duncan, SC 219,703 (c) 219,703 -
Topeka, KS 414,686 (c) 414,686 -
Winter Springs, FL 555,232 (c) 555,232 -
Eckerd:
San Antonio, TX 440,985 (c) 440,985 -
Dallas, TX 541,493 (c) 541,493 -
Garland, TX 239,014 (c) 239,014 -
Arlington, TX 368,964 (c) 368,964 -
Millville, NJ 417,603 (c) 417,603 -
Atlanta, GA 445,593 (c) 445,593 -
Mantua, NJ 344,022 (c) 344,022 -
Amarillo, TX 641,439 (c) 641,439 -
Amarillo, TX 322,200 (c) 322,200 -
Glassboro, NJ 534,243 (c) 534,243 -
Kissimmee, FL 718,484 (c) 718,484 -
Colleyville, TX 755,647 (c) 755,647 -
Tampa, FL 604,682 (c) 604,682 -
Food 4 Less:
Lemon Grove, CA 3,454,917 (f) 3,454,917 -
Golden Corral Family
Steakhouse
Restaurants:
Foley, AL (e) 101,286 283,991 385,277 96,585
Edenton, NC 36,578 318,481 355,059 106,421
Woodstock, GA 200,680 328,450 529,130 109,703
Bonham, TX (e) 128,451 344,170 472,621 113,920
Center, TX (e) 103,187 308,859 412,046 102,244
Gilmer, TX (e) 116,815 296,454 413,269 98,137
Leitchfield,
KY (e) 73,660 306,642 380,302 101,500
Marietta, GA (g) 156,190 346,509 502,699 114,696
Rockledge, FL 120,593 340,889 461,482 112,834
Silsbee, TX (e) 132,802 302,052 434,854 99,994
Atlanta, TX 88,457 368,317 456,774 121,545
Vernon, TX (e) 105,798 328,943 434,741 105,262
Abbeville, LA 98,577 362,416 460,993 115,973
Fredericksburg,
TX 169,984 321,189 491,173 102,781
Gonzales, TX (e) 104,833 312,872 417,705 100,119
Bowie, TX (e) 57,824 311,544 369,368 99,694
Clanton, AL (e) 113,017 296,921 409,938 95,015
Jacksonville, TX 115,276 318,196 433,472 101,823
Lake Placid,
FL (e) 115,113 305,074 420,187 97,624
Pleasanton, TX 139,694 316,070 455,764 101,142
Marble Falls,
TX (e) 151,985 338,704 490,689 108,385
Ennis, TX 153,700 366,639 520,339 113,658
Franklin, LA (e) 105,839 396,831 502,670 123,017
Melbourne, FL 193,447 341,351 534,798 105,819
Franklin, VA 93,719 424,164 517,883 93,569
Minden, LA (e) 86,120 402,364 488,484 68,735
Durant, OK 140,862 411,135 551,997 66,017
Hardee's Restaurants:
Chalkville, AL 170,834 457,167 628,001 24,862
Gulf Shores, AL 348,281 595,164 943,445 32,367
Mobile, AL 336,696 (c) 336,696 -
Warrior, AL 177,659 (c) 177,659 -
Horn Lake, MS 302,787 (c) 302,787 -
Petal, MS 277,104 415,193 692,297 22,580
West Point, MS 173,386 (c) 173,386 -
Rock Hill, SC 216,777 466,450 683,227 25,367
Columbia, TN 226,300 (c) 226,300 -
Johnson City, TN 215,567 (c) 215,567 -
Tusculum, TN 182,349 507,293 689,642 27,588
Hi-Lo Automotive:
Mesquite, TX 233,420 513,523 746,943 15,461
Fort Worth, TX 197,037 512,296 709,333 13,906
Houston, TX 261,318 531,968 793,286 14,444
Arlington, TX 295,331 571,609 866,940 15,518
Garland, TX 239,570 512,023 751,593 13,897
Dallas, TX 281,347 543,937 825,284 13,745
McAllen, TX 265,177 605,397 870,574 3,952
Temple, TX 177,451 587,755 765,206 3,837
San Antonio, TX 200,510 643,741 844,251 4,202
Universal City, TX 247,264 570,677 817,941 3,725
Bastrop, TX 197,905 383,144 581,049 2,501
Lake Worth, TX 252,141 539,510 791,651 3,522
Nacogdoches, TX 190,324 522,232 712,556 3,409
Eagle Pass, TX 256,745 455,841 712,586 2,976
International House
of Pancakes
Restaurants:
Stafford, TX 382,084 (c) 382,084 -
Sunset Hills, MO 271,853 (c) 271,853 -
Las Vegas, NV 519,947 (c) 519,947 -
Fort Worth, TX 430,896 (c) 430,896 -
Arlington, TX 404,512 (c) 404,512 -
Matthews, NC 380,043 (c) 380,043 -
Phoenix, AZ 483,374 (c) 483,374 -
Linens 'n Things:
Freehold, NJ 1,753,766 2,208,651 3,962,417 74,067
Marshalls:
Freehold, NJ 2,052,946 2,585,432 4,638,378 86,702
Office Depot:
Arlington, TX 596,024 1,411,432 2,007,456 67,551
OfficeMax:
Corpus Christi, TX 893,270 1,055,008 1,948,278 55,503
Dallas, TX 1,118,500 1,709,891 2,828,391 85,612
Cincinnati, OH 543,489 1,574,551 2,118,040 58,372
Evanston, IL 1,867,831 1,757,618 3,625,449 24,655
Pier 1 Imports:
Dallas, TX 189,010 1,085,502 1,274,512 47,078
Pizza Hut Restaurant:
Orlando, FL 220,632 258,483 479,115 29,836
Rally's Restaurant:
Toledo, OH 125,882 319,770 445,652 28,851
Scotty's:
Orlando, FL 1,064,260 2,049,431 3,113,691 26,188
Orlando, FL 1,187,730 2,131,807 3,319,537 27,241
Sears Homelife
Centers:
Orlando, FL 820,397 2,184,721 3,005,118 141,782
Clearwater, FL 1,184,438 2,526,207 3,710,645 163,944
Oshmans:
Dallas, TX 1,311,440 (c) 1,311,440 -
Waccamaw:
Fairfax, VA 2,156,801 (c) 2,156,801 -
Wendy's Old Fashioned
Hamburger Restau-
rants:
Fenton, MO 307,068 496,410 803,478 52,716
Longwood, FL 333,335 194,926 528,261 21,745
----------- ----------- ------------ ----------
$83,356,403 $78,097,726 $161,454,129 $5,497,390
=========== =========== ============ ==========
Properties the Company
has Invested in Under
Direct Financing
Leases:
Academy:
Houston, TX - (c) (c) (c)
Houston, TX - (c) (c) (c)
Checkers Restaurant:
Orlando, FL - (c) (c) (c)
Denny's Restaurants:
Landrum, SC - (c) (c) (c)
Mooresville, NC - (c) (c) (c)
Akron, OH (d) (d) (d) (d)
Duncan, SC - (c) (c) (c)
Topeka, KS - (c) (c) (c)
Winter Springs, FL - (c) (c) (c)
Eckerd:
San Antonio, TX - (c) (c) (c)
Dallas, TX - (c) (c) (c)
Garland, TX - (c) (c) (c)
Arlington, TX - (c) (c) (c)
Millville, NJ - (c) (c) (c)
Atlanta, GA - (c) (c) (c)
Mantua, NJ - (c) (c) (c)
Vineland, NJ (d) (d) (d) (d)
Amarillo, TX - (c) (c) (c)
Amarillo, TX (d) (d) (d) (d)
Amarillo, TX - (c) (c) (c)
Glassboro, NJ - (c) (c) (c)
Kissimmee, FL - (c) (c) (c)
Alice, TX (d) (d) (d) (d)
Colleyville, TX - (c) (c) (c)
Tampa, FL - (c) (c) (c)
Food Lion Super-
markets:
Keystone Heights,
FL (d) (d) (d) (d)
Chattanooga, TN (d) (d) (d) (d)
Lynchburg, VA (d) (d) (d) (d)
Martinsburg, WV (d) (d) (d) (d)
Good Guys:
Stockton, CA (d) (d) (d) (d)
Hardee's Restaurants:
Mobile, AL - (c) (c) (c)
Warrior, AL - (c) (c) (c)
Horn Lake, MS - (c) (c) (c)
Iuka, MS (d) (d) (d) (d)
West Point, MS - (c) (c) (c)
Biscoe, NC (d) (d) (d) (d)
Aynor, SC (d) (d) (d) (d)
Columbia, TN - (c) (c) (c)
Johnson City, TN - (c) (c) (c)
Hi-Lo Automotive:
Edinberg, TX (d) (d) (d) (d)
Copperas Cove, TX (d) (d) (d) (d)
Baton Rouge, LA (d) (d) (d) (d)
Lake Jackson, TX (d) (d) (d) (d)
Fort Worth, TX (d) (d) (d) (d)
Pantego, TX (d) (d) (d) (d)
Fort Worth, TX (d) (d) (d) (d)
Pharr, TX (d) (d) (d) (d)
Baton Rouge, LA (d) (d) (d) (d)
Houston, TX (d) (d) (d) (d)
International House
of Pancakes
Restaurants:
Stafford, TX - (c) (c) (c)
Sunset Hills, MO - (c) (c) (c)
Las Vegas, NV - (c) (c) (c)
Fort Worth, TX - (c) (c) (c)
Arlington, TX - (c) (c) (c)
Matthews, NC - (c) (c) (c)
Phoenix, AZ - (c) (c) (c)
Levitz:
Tempe, AZ (d) (d) (d) (d)
Oshmans:
Dallas, TX - (c) (c) (c)
Waccamaw:
Fairfax, VA - (c) (c) (c)
COMMERCIAL NET LEASE REALTY, INC.
SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
-------------------------------------------------------------------
December 31, 1995
(J) (K) (L)
Life on Which
Depreciation in
Latest Income
Date of Date Statement is
Construction Acquired Computed
------------ -------- ---------------
Properties the Company
has Invested in Under
Operating Leases:
Academy:
Houston, TX 1994 05/95 (c)
Houston, TX 1995 06/95 (c)
N. Richland
Hills, TX (f) 08/95 (f)
Barnes & Noble:
Lakeland, FL 1995 07/94 (h) 40 years
Brandon, FL 1995 08/94 (h) 40 years
Denver, CO 1994 09/94 40 years
Houston, TX 1995 10/94 (h) 40 years
Plantation, FL (f) 05/95 (f)
Cary, NC (f) 05/95 (f)
Lafayette, LA (f) 06/95 (f)
Oklahoma City, OK (f) 06/95 (f)
Daytona, FL (f) 09/95 (f)
Best Buy:
Corpus Christi, TX 1967 11/93 40 years
Blockbuster Music:
Dallas, TX 1980 04/94 40 years
Borders:
Wilmington, DE 1994 12/94 40 years
Richmond, VA 1995 06/95 40 years
Burger King
Restaurants:
Asheboro, NC 1986 07/92 40 years
Galliano, LA 1991 07/92 40 years
John's Island, SC 1988 07/92 40 years
Lake Charles, LA 1988 07/92 40 years
Lancaster, OH 1987 07/92 40 years
Natchez, MS 1986 07/92 40 years
Tappahannock, VA 1987 07/92 40 years
Warren, MI 1987 07/92 40 years
Manchester, NH 1980 05/93 40 years
Rochester, NH 1987 05/93 40 years
St. Paul, MN 1986 06/93 40 years
Columbus, OH 1982 06/93 40 years
Opelousas, LA 1989 06/93 40 years
Coon Rapids, MI 1990 06/93 40 years
Checkers Restaurant:
Orlando, FL 1988 07/92 (c)
CompUSA:
Mission Viejo, CA 1994 02/94 40 years
Computer City:
Miami, FL 1994 04/94 40 years
Baton Rouge, LA 1995 12/95 40 years
Denny's Restaurants:
Greenville, SC 1985 05/93 40 years
Landrum, SC 1992 05/93 (c)
Mooresville, NC 1992 05/93 (c)
Greensboro, NC 1992 05/93 40 years
Houston, TX 1991 05/93 40 years
Santee, SC 1992 05/93 40 years
Duncan, SC 1992 05/93 (c)
Topeka, KS 1990 06/93 (c)
Winter Springs, FL 1994 01/94 (c)
Eckerd:
San Antonio, TX 1993 12/93 (c)
Dallas, TX 1994 01/94 (c)
Garland, TX 1994 02/94 (c)
Arlington, TX 1994 02/94 (c)
Millville, NJ 1994 03/94 (c)
Atlanta, GA 1994 03/94 (c)
Mantua, NJ 1994 06/94 (c)
Amarillo, TX 1994 12/94 (c)
Amarillo, TX 1994 12/94 (c)
Glassboro, NJ 1994 12/94 (c)
Kissimmee, FL 1995 04/95 (c)
Colleyville, TX 1995 06/95 (c)
Tampa, FL 1995 12/95 (c)
Food 4 Less:
Lemon Grove, CA (f) 07/95 (f)
Golden Corral Family
Steakhouse
Restaurants:
Foley, AL (e) 1984 10/84 35 years
Edenton, NC 1984 11/84 35 years
Woodstock, GA 1984 11/84 35 years
Bonham, TX (e) 1984 12/84 35 years
Center, TX (e) 1984 12/84 35 years
Gilmer, TX (e) 1984 12/84 35 years
Leitchfield,
KY (e) 1984 12/84 35 years
Marietta, GA (g) 1984 12/84 35 years
Rockledge, FL 1984 12/84 35 years
Silsbee, TX (e) 1984 12/84 35 years
Atlanta, TX 1985 01/85 35 years
Vernon, TX (e) 1985 03/85 35 years
Abbeville, LA 1985 04/85 35 years
Fredericksburg,
TX 1985 04/85 35 years
Gonzales, TX (e) 1985 04/85 35 years
Bowie, TX (e) 1985 05/85 35 years
Clanton, AL (e) 1985 05/85 35 years
Jacksonville, TX 1985 05/85 35 years
Lake Placid,
FL (e) 1985 05/85 35 years
Pleasanton, TX 1985 05/85 35 years
Marble Falls,
TX (e) 1985 06/85 35 years
Ennis, TX 1985 07/85 35 years
Franklin, LA (e) 1985 07/85 35 years
Melbourne, FL 1985 07/85 35 years
Franklin, VA 1987 02/87 40 years
Minden, LA (e) 1989 03/89 40 years
Durant, OK 1989 08/89 40 years
Hardee's Restaurants:
Chalkville, AL 1992 10/93 40 years
Gulf Shores, AL 1992 10/93 40 years
Mobile, AL 1993 10/93 (c)
Warrior, AL 1992 10/93 (c)
Horn Lake, MS 1993 10/93 (c)
Petal, MS 1993 10/93 40 years
West Point, MS 1993 10/93 (c)
Rock Hill, SC 1993 10/93 40 years
Columbia, TN 1993 10/93 (c)
Johnson City, TN 1993 10/93 (c)
Tusculum, TN 1993 10/93 40 years
Hi-Lo Automotive:
Mesquite, TX 1994 10/94 40 years
Fort Worth, TX 1994 11/94 40 years
Houston, TX 1994 11/94 40 years
Arlington, TX 1993 11/94 40 years
Garland, TX 1993 11/94 40 years
Dallas, TX 1994 12/94 40 years
McAllen, TX 1982 09/95 40 years
Temple, TX 1989 09/95 40 years
San Antonio, TX 1994 09/95 40 years
Universal City, TX 1995 09/95 40 years
Bastrop, TX 1994 09/95 40 years
Lake Worth, TX 1995 09/95 40 years
Nacogdoches, TX 1995 09/95 40 years
Eagle Pass, TX 1994 09/95 40 years
International House
of Pancakes
Restaurants:
Stafford, TX 1992 10/93 (c)
Sunset Hills, MO 1993 10/93 (c)
Las Vegas, NV 1993 12/93 (c)
Fort Worth, TX 1993 12/93 (c)
Arlington, TX 1993 12/93 (c)
Matthews, NC 1993 12/93 (c)
Phoenix, AZ 1993 12/93 (c)
Linens 'n Things:
Freehold, NJ 1994 08/94 40 years
Marshalls:
Freehold, NJ 1994 08/94 40 years
Office Depot:
Arlington, TX 1991 01/94 40 years
OfficeMax:
Corpus Christi, TX 1967 11/93 40 years
Dallas, TX 1993 12/93 40 years
Cincinnati, OH 1994 07/94 40 years
Evanston, IL 1995 06/95 40 years
Pier 1 Imports:
Dallas, TX 1980 04/94 40 years
Pizza Hut Restaurant:
Orlando, FL 1974 08/93 20.9 years
Rally's Restaurant:
Toledo, OH 1989 07/92 38.8 years
Scotty's:
Orlando, FL 1995 06/95 40 years
Orlando, FL 1995 06/95 40 years
Sears Homelife
Centers:
Orlando, FL 1992 05/93 40 years
Clearwater, FL 1992 05/93 40 years
Oshmans:
Dallas, TX 1994 03/94 (c)
Waccamaw:
Fairfax, VA 1995 12/95 (c)
Wendy's Old Fashioned
Hamburger Restau-
rants:
Fenton, MO 1985 07/92 33 years
Longwood, FL 1982 07/92 31.4 years
Properties the Company
has Invested in Under
Direct Financing
Leases:
Academy:
Houston, TX 1994 05/95 (c)
Houston, TX 1995 06/95 (c)
Checkers Restaurant:
Orlando, FL 1988 07/92 (c)
Denny's Restaurants:
Landrum, SC 1992 05/93 (c)
Mooresville, NC 1992 05/93 (c)
Akron, OH 1992 05/93 (d)
Duncan, SC 1992 05/93 (c)
Topeka, KS 1990 06/93 (c)
Winter Springs, FL 1994 01/94 (c)
Eckerd:
San Antonio, TX 1993 12/93 (c)
Dallas, TX 1994 01/94 (c)
Garland, TX 1994 02/94 (c)
Arlington, TX 1994 02/94 (c)
Millville, NJ 1994 03/94 (c)
Atlanta, GA 1994 03/94 (c)
Mantua, NJ 1994 06/94 (c)
Vineland, NJ 1990 11/94 (d)
Amarillo, TX 1994 12/94 (c)
Amarillo, TX 1994 12/94 (d)
Amarillo, TX 1994 12/94 (c)
Glassboro, NJ 1994 12/94 (c)
Kissimmee, FL 1995 04/95 (c)
Alice, TX 1995 06/95 (d)
Colleyville, TX 1995 06/95 (c)
Tampa, FL 1995 12/95 (c)
Food Lion Super-
markets:
Keystone Heights,
FL 1993 05/93 (d)
Chattanooga, TN 1993 10/93 (d)
Lynchburg, VA 1994 01/94 (d)
Martinsburg, WV 1994 08/94 (d)
Good Guys:
Stockton, CA 1991 07/94 (d)
Hardee's Restaurants:
Mobile, AL 1993 10/93 (c)
Warrior, AL 1992 10/93 (c)
Horn Lake, MS 1993 10/93 (c)
Iuka, MS 1993 10/93 (d)
West Point, MS 1993 10/93 (c)
Biscoe, NC 1993 10/93 (d)
Aynor, SC 1993 10/93 (d)
Columbia, TN 1993 10/93 (c)
Johnson City, TN 1993 10/93 (c)
Hi-Lo Automotive:
Edinberg, TX 1993 10/94 (d)
Copperas Cove, TX 1994 10/94 (d)
Baton Rouge, LA 1994 10/94 (d)
Lake Jackson, TX 1994 10/94 (d)
Fort Worth, TX 1993 10/94 (d)
Pantego, TX 1993 10/94 (d)
Fort Worth, TX 1993 11/94 (d)
Pharr, TX 1993 11/94 (d)
Baton Rouge, LA 1994 12/94 (d)
Houston, TX 1982 09/95 (d)
International House
of Pancakes
Restaurants:
Stafford, TX 1992 10/93 (c)
Sunset Hills, MO 1993 10/93 (c)
Las Vegas, NV 1993 12/93 (c)
Fort Worth, TX 1993 12/93 (c)
Arlington, TX 1993 12/93 (c)
Matthews, NC 1993 12/93 (c)
Phoenix, AZ 1993 12/93 (c)
Levitz:
Tempe, AZ 1994 01/95 (d)
Oshmans:
Dallas, TX 1994 03/94 (c)
Waccamaw:
Fairfax, VA 1995 12/95 (c)
COMMERCIAL NET LEASE REALTY, INC.
NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
----------------------------------------------------------------
December 31, 1995
(a) Transactions in real estate and accumulated depreciation during 1995,
1994 and 1993, are summarized as follows:
Accumulated
Cost Depreciation
------------ ------------
Properties the Company
has Invested in Under
Operating Leases:
Balance, December 31, 1992 $ 24,110,390 $2,072,199
Acquisitions 31,748,181 -
Sale of land and buildings (1,225,217) (11,764)
Depreciation expense - 624,341
------------ ----------
Balance, December 31, 1993 54,633,354 2,684,776
Acquisitions 55,219,077 -
Depreciation expense - 1,076,593
------------ ----------
Balance, December 31, 1994 109,852,431 3,761,369
Acquisitions 51,601,698 -
Depreciation expense - 1,736,021
------------ ----------
Balance, December 31, 1995 $161,454,129 $5,497,390
============ ==========
(b) As of December 31, 1995, all of the leases are treated as operating
leases for federal income tax purposes. As of December 31, 1995, the
aggregate cost of the Properties owned by the Company and its
subsidiaries for federal income tax purposes was $219,057,229 and
$152,715,644, respectively.
(c) For financial reporting purposes, the portion of the lease relating to
the building has been recorded as a direct financing lease. The cost of
the building has been included in net investment in direct financing
leases; therefore, depreciation is not applicable.
(d) For financial reporting purposes, the lease for the land and building
has been recorded as a direct financing lease. The cost of the land and
building has been included in net investment in direct financing leases;
therefore, depreciation is not applicable.
(e) The tenant of this Property, Golden Corral Corporation, has subleased
this Property to a separate operator. Golden Corral Corporation
continues to be responsible for complying with all the terms of the
lease agreement and is continuing to pay rent on this Property to the
Company.
(f) The Company owns only land for this Property. Pursuant to the lease
agreement, the Company will purchase the building once construction is
complete.
(g) The tenant of this Property, Golden Corral Corporation, has subleased
this Property to an operator of a Ragazzi's restaurant. Golden Corral
Corporation continues to be responsible for complying with all of the
terms of the lease agreement and is continuing to pay rent on this
Property to the Company.
(h) Date acquired represents acquisition date of land. Pursuant to the
lease agreement, the Company purchased the buildings from the tenants
upon completion of construction, generally within 12 months from the
acquisition of the land.
EXHIBITS
--------
EXHIBIT INDEX
-------------
Exhibit Page
------- ----
3.1 Articles of Incorporation of the Registrant
(filed as Exhibit 3.3(i) to the Registrant's
Registration Statement No. 1-11290 on Form 8-B,
and incorporated herein by reference).
3.2 Bylaws of the Registrant, (filed as Exhibit
3(ii) to Amendment No. 2 to the Registrant's
Registration No. 33-83110 on Form S-3, and
incorporated herein by reference).
4 Specimen Certificate of Common Stock, par value
$.01 per share, of the Registrant (filed as
Exhibit 3.4 to the Registrant's Registration
Statement No. 1-11290 on Form 8-B and
incorporated herein by reference).
10.1 Stock Purchase Agreement dated as of January 23,
1992 by and among the Registrant, CNL Group,
Inc. and certain entities affiliated therewith
(filed as Exhibit 10.4 to the Registrant's
Annual Report on Form 10-K for the year ended
December 31, 1991, and incorporated herein by
reference).
10.2 Letter Agreement dated July 10, 1992, amending
Stock Purchase Agreement dated January 23, 1992
(filed as Exhibit 10.34 to the Registrant's
Quarterly Report on Form 10-Q for the quarter
ended June 30, 1992, and incorporated herein by
reference).
10.3 Form of Advisory Agreement between the
Registrant and CNL Realty Advisors, Inc. (filed
as Exhibit 10.21 to the Registrant's Report on
Form 8 dated April 29, 1992, amending its Annual
Report on Form 10-K for the year ended December
31, 1991, and incorporated herein by reference).
10.4 Advisory Agreement between Registrant and CNL
Realty Advisors, Inc. effective as of April 1,
1993 and renewed January 1, 1995 (filed as
Exhibit 10.04 to Amendment No. 1 to the
Registrant's Registration Statement No. 33-61214
on Form S-2, and incorporated herein by
reference).
10.5 Revolving Line of Credit and Security Agreement,
dated as of July 25, 1994, among Registrant,
certain lenders listed therein and First Union
National Bank of Florida, as the Agent, relating
to a $100,000,000 loan (filed as Exhibit 10.11
to the Registrant's Quarterly Report on Form 10-
Q for the quarter ended June 30, 1994, and
incorporated herein by reference).
10.6 1992 Commercial Net Lease Realty, Inc. Stock
Option Plan (filed as Exhibit No. 10(x) to the
Registrant's Registration Statement No. 33-83110
on Form S-3, and incorporated herein by
reference).
10.7 Interest Rate Cap Agreement dated February 28,
1994, by and between the Registrant and First
Union National Bank of North Carolina (filed as
Exhibit No. 10(xi) to the Registrant's
Registration Statement No. 33-83110 on Form S-3,
and incorporated herein by reference).
10.8 Interest Rate Cap Agreement dated December 23,
1994, by and between the Registrant and First
Union National Bank of Florida (filed as Exhibit
10.12 to the Registrant's Annual Report on Form
10-K for the year ended December 31, 1994, and
incorporated by reference).
10.9 Second Amended and Restated Line of Credit and
Security Agreement, dated December 7, 1995,
among Registrant, certain lenders listed therein
and First Union National Bank of Florida, as the
Agent relating to a $100,000,000 loan (filed as
Exhibit 10.14 to the Registrant's Current Report
on Form 8-K dated January 18, 1996, and
incorporated herein by reference).
10.10 Secured Promissory Note, dated December 14,
1995, among Registrant and Principal Mutual Life
Insurance Company relating to a $13,150,000 loan
(filed as Exhibit 10.15 to the Registrant's
Current Report on Form 8-K dated January 18,
1996, and incorporated herein by reference).
10.11 Mortgage and Security Agreement, dated December
14, 1995, among Registrant and Principal Mutual
Life Insurance Company relating to a $13,150,000
loan (filed as Exhibit 10.16 to the Registrant's
Current Report on Form 8-K dated January 18,
1996, and incorporated herein by reference).
10.12 Loan Agreement, dated January 19, 1996, among
Registrant and Principal Mutual Life Insurance
Company relating to a $39,450,000 loan. Filed
herewith.
10.13 Secured Promissory Note, dated January 19, 1996,
among Registrant and Principal Mutual Life
Insurance Company relating to a $39,450,000
loan. Filed herewith.
13 Annual Report to Shareholders for the year ended
December 31, 1995 ("filed" only to the extent
material therefrom is specifically incorporated
herein by reference).
23 Consent of Independent Accountants dated March
22, 1996. Filed herewith.