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What changed in AGREE REALTY CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of AGREE REALTY CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+237 added−211 removedSource: 10-K (2025-02-11) vs 10-K (2024-02-13)

Top changes in AGREE REALTY CORP's 2024 10-K

237 paragraphs added · 211 removed · 185 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThe Company believes that team members who are healthy, fit, financially secure and motivated are team members who achieve personal and professional success. Ongoing professional development is offered to help all team members advance their careers. The Company regularly sponsors local charities and has received numerous local awards recognizing its outstanding corporate culture and wellness initiatives.
Biggest changeOngoing professional development is offered to help all team members advance their careers. The Company regularly sponsors local charities and has received numerous local awards recognizing its outstanding corporate culture and wellness initiatives. The Company supports healthy living through enhanced health insurance, an on-site gym, training and education, various complementary meal programs and many other benefits.
The Company’s Culture Committee hosts a variety of events that are focused on team building and camaraderie as well as contributing to the communities in which they live. Governance Fiduciary Duties and Ethics We believe that nothing is more important than a company’s reputation for integrity and serving as a responsible fiduciary for its stockholders.
The Company’s Culture Committee hosts a variety of events that are focused on team building and camaraderie as well as contributing to the communities in which we live. Governance, Fiduciary Duties and Ethics We believe that nothing is more important than a company’s reputation for integrity and serving as a responsible fiduciary for its stockholders.
Factors that we consider when evaluating an investment include but are not limited to: ● Overall market-specific characteristics, such as demographics, market rents, competition and retail synergy; ● Asset-specific characteristics, such as the age, size, location, zoning, use and environmental history, accessibility, physical condition, signage and visibility of the property; ● Tenant-specific characteristics, including but not limited to the financial profile, operating history, business plan, 4 Table of Contents size, market positioning, geographic footprint, management team, industry and/or sector-specific trends and other characteristics specific to the tenant and parent thereof; ● Unit-level operating characteristics, including store sales performance and profitability, if available; ● Lease-specific terms, including term of the lease, rent to be paid by the tenant and other tenancy considerations; and ● Transaction considerations, such as purchase price, seller profile and other non-financial terms.
Factors that we consider when evaluating an investment include but are not limited to: ● Overall market-specific characteristics, such as demographics, market rents, competition and retail synergy; ● Asset-specific characteristics, such as the age, size, location, zoning, use and environmental history, accessibility, physical condition, signage and visibility of the property; ● Tenant-specific characteristics, including but not limited to the financial profile, operating history, business plan, 5 Table of Contents size, market positioning, geographic footprint, management team, industry and/or sector-specific trends and other characteristics specific to the tenant and parent thereof; ● Unit-level operating characteristics, including store sales performance and profitability, if available; ● Lease-specific terms, including term of the lease, rent to be paid by the tenant and other tenancy considerations; and ● Transaction considerations, such as purchase price, seller profile and other non-financial terms.
We all roll up our sleeves and dig in, no matter the task. ● Brick by Brick - We achieve results by making consistent, disciplined decisions. ● Greatness Requires Grit - We have a resilient mindset to achieve and exceed our goals. 6 Table of Contents ● Punch Your Ticket - We push ourselves to be the best we can at our position and embrace the opportunities that new challenges present. ​ We work to attract the best talent externally to meet the current and future demands of our business.
We all roll up our sleeves and dig in, no matter the task. ● Brick by Brick - We achieve results by making consistent, disciplined decisions. ● Greatness Requires Grit - We have a resilient mindset to achieve and exceed our goals. 7 Table of Contents ● Punch Your Ticket - We push ourselves to be the best we can at our position and embrace the opportunities that new challenges present. ​ We work to attract the best talent externally to meet the current and future demands of our business.
Such a system helps us to maximize cash flow from operations and closely monitor corporate expenses. 5 Table of Contents Competition The U.S. commercial real estate investment market is a highly competitive industry. We actively compete with many entities engaged in the acquisition, development and operation of commercial properties.
Such a system helps us to maximize cash flow from operations and closely monitor corporate expenses. 6 Table of Contents Competition The U.S. commercial real estate investment market is a highly competitive industry. We actively compete with many entities engaged in the acquisition, development and operation of commercial properties.
Time-vested stock grants to officers and team members vest over a three-year period to provide long-term alignment, while performance-based stock grants to named executive officers utilize total shareholder return, with the amount of the grants intended to increase as total returns to 8 Table of Contents stockholders increase, further enhancing alignment.
Time-vested stock grants to officers and team members vest over a three-year period to provide long-term alignment, while performance-based stock grants to named 9 Table of Contents executive officers utilize total shareholder return, with the amount of the grants intended to increase as total returns to stockholders increase, further enhancing alignment.
There can be no assurance that we will be able to compete successfully with such entities in our acquisition, development and leasing activities in the future. Significant Tenants No tenant accounted for more than 10.0% of our annualized base rent as of December 31, 2023.
There can be no assurance that we will be able to compete successfully with such entities in our acquisition, development and leasing activities in the future. Significant Tenants No tenant accounted for more than 10.0% of our annualized base rent as of December 31, 2024.
As of December 31, 2023, we have not received notice from any governmental authority, nor are we otherwise aware, of any non-compliance with the ADA that we believe would have a material adverse effect on our business, financial position or results of operations.
As of December 31, 2024, we have not received notice from any governmental authority, nor are we otherwise aware, of any non-compliance with the ADA that we believe would have a material adverse effect on our business, financial position or results of operations.
The Company’s assets are held by, and all of its operations are conducted through, directly or indirectly, the Operating Partnership of which the Company is the sole general partner and in which it held a 99.7% common interest as of December 31, 2023.
The Company’s assets are held by, and all of its operations are conducted through, directly or indirectly, the Operating Partnership of which the Company is the sole general partner and in which it held a 99.7% common interest as of December 31, 2024.
We occasionally sell common stock through forward sale agreements, enabling the Company to set the price of shares upon pricing the offering while delaying the issuance of shares and the receipt of the net proceeds by the Company.
Additionally, we sell common stock through forward sale agreements, enabling the Company to set the price of shares upon pricing the offering while delaying the issuance of shares and the receipt of the net proceeds by the Company.
Common cash dividends were paid quarterly for 107 consecutive quarters between 1994 and 2020 prior to moving to monthly common cash dividends in 2021. We have since paid 37 consecutive monthly dividends.
Common cash dividends were paid quarterly for 107 consecutive quarters between 1994 and 2020 prior to moving to monthly common cash dividends in 2021. We have since paid 48 consecutive monthly dividends.
A significant majority of the Company’s properties are leased to national tenants and approximately 69.1% of our annualized base rent was derived from tenants, or parent entities thereof, with an investment grade credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners.
A significant majority of the Company’s properties are leased to national tenants and approximately 68.2% of our annualized base rent was derived from tenants, or parent entities thereof, with an investment grade credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners.
Human Capital Team Members and Values As of December 31, 2023, the Company had 72 full-time team members covering acquisitions, development, legal, asset management, accounting, finance, administrative, and executive functions as compared to 76 full-time team members as of December 31, 2022. ​ Our core values are the foundation of our Company culture and include: ● We All Do the Dishes - We are a team.
Human Capital Team Members and Values As of December 31, 2024, the Company had 75 full-time team members covering acquisitions, development, legal, asset management, accounting, finance, administrative, and executive functions as compared to 72 full-time team members as of December 31, 2023. ​ Our core values are the foundation of our Company culture and include: ● We All Do the Dishes - We are a team.
This is particularly meaningful because the Company’s portfolio is primarily comprised of properties that are leased to tenants under long-term net leases where the tenant is generally responsible for maintaining the property and implementing environmentally responsible practices. ​ In 2023, we engaged with our retail partners on shared sustainability initiatives at our properties, and executing green leases with various tenants, as well as systematically monitoring ESG policies for current and prospective tenants.
This is particularly meaningful because the Company’s portfolio is primarily comprised of properties that are leased to tenants under long-term net leases where the tenant is generally responsible for maintaining the property and implementing environmentally responsible practices. ​ We engaged with our retail partners on shared sustainability initiatives at our properties, and executed green leases with various tenants, as well as systematically monitored ESG policies for current and prospective tenants.
Our developments are typically build-to-suit projects that result in fee simple ownership of the property upon completion. Developer Funding Platform: Our DFP, previously called Partner Capital Solutions, collaborates with developers or retailers on their in-process developments. We offer construction expertise and access to capital to facilitate the successful completion of their projects.
Our developments are typically build-to-suit projects that result in fee simple ownership of the property upon completion. Developer Funding Platform: Our DFP collaborates with developers or retailers on their in-process developments. We offer construction expertise and access to capital to facilitate the successful completion of their projects. We typically take fee simple ownership of DFP projects upon completion.
Recent Developments For a discussion of business developments that occurred in 2023, see “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations” later in this report. Certain summarized highlights are contained below. Investments and Disposition Activity During 2023, the Company completed approximately $1.28 billion of investments in net leased retail real estate.
Recent Developments For a discussion of business developments that occurred in 2024, see “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations” later in this report. Certain summarized highlights are contained below. Investments and Disposition Activity During 2024, the Company completed approximately $939.2 million of investments in net leased retail real estate.
As of December 31, 2023, the Company’s ratio of total debt to enterprise value, assuming the conversion of common limited partnership interests in the Operating Partnership (“Operating Partnership Common Units”) into shares of common stock, was approximately 27.2%, and its ratio of total debt to total gross assets (before accumulated depreciation) was approximately 29.6%.
As of December 31, 2024, the Company’s ratio of total debt to enterprise value, assuming the conversion of common limited partnership interests in the Operating Partnership (“Operating Partnership Common Units”) into shares of common stock, was approximately 26.6%, and its ratio of total debt to total gross assets (before accumulated depreciation) was approximately 31.1%.
We typically take fee simple ownership of DFP projects upon completion. Acquisitions: Our acquisitions platform expands our investment capabilities by pursuing opportunities that meet both our real estate and return on investment criteria. We believe that development and DFP projects have the potential to generate superior risk-adjusted returns on investment in properties that are substantially similar to those we acquire.
Acquisitions: Our acquisitions platform expands our investment capabilities by pursuing opportunities that meet both our real estate and return on investment criteria. We believe that development and DFP projects have the potential to generate superior risk-adjusted returns on investment in properties that are substantially similar to those we acquire.
Leasing During 2023, excluding properties that were sold, the Company executed new leases, extensions or options on approximately 1,873,000 square feet of GLA throughout its portfolio. The annualized base contractual rent associated with these new leases, extensions or options is approximately $15.8 million.
Leasing During 2024, excluding properties that were sold, the Company executed new leases, extensions or options on approximately 2,041,000 square feet of GLA throughout its portfolio. The annualized base contractual rent associated with these new leases, extensions or options is approximately $19.8 million.
The Company pays 100% of medical, short-term, long-term, and life insurance premiums for team members and their families. ​ Environmental, Social and Governance (“ESG”) As part of the Company’s commitment to continuously improving our understanding of and performance across material ESG topics, the Company engaged a third-party consultant since 2022 to help identify opportunities for improvement across our programs, policies, and disclosures to meet the expectations of our stakeholders.
The Company pays 100% of medical premiums for team members and their families for two plan options. ​ Environmental, Social and Governance (“ESG”) As part of the Company’s commitment to continuously improving our understanding of and performance across material ESG topics, the Company engaged a third-party consultant since 2022 to help identify opportunities for improvement 8 Table of Contents across our programs, policies, and disclosures to meet the expectations of our stakeholders.
The Company was incorporated in December 1993 under the laws of the State of Maryland. The Company believes that it has operated, and it intends to continue to operate, in such a manner to qualify as a REIT under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”).
The Company believes that it has operated, and it intends to continue to operate, in such a manner to qualify as a REIT under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”).
The Company executed an 7 Table of Contents ongoing sustainability and ESG strategy to enhance our oversight structure, risk management, policies, data collection, reporting, and stakeholder engagement. Additionally, the Company received Gold Level recognition from Green Lease Leaders.
The Company executed an ongoing sustainability and ESG strategy to enhance our oversight structure, risk management, policies, data collection, reporting, and stakeholder engagement. Additionally, the Company received Gold Level recognition from Green Lease Leaders for two consecutive years.
Under the agreement of limited partnership of the Operating Partnership, the Company, as the sole general partner, has exclusive responsibility and discretion in the management and control of the Operating Partnership. As of December 31, 2023, the Company’s portfolio consisted of 2,135 properties located in 49 states and totaling approximately 44.2 million square feet of Gross Leasable Area (“GLA”).
Under the agreement of limited partnership of the Operating Partnership, the Company, as the sole general partner, has exclusive responsibility and discretion in the management and control of the Operating Partnership. As of December 31, 2024, the Company’s portfolio consisted of 2,370 properties located in all 50 states and totaling approximately 48.8 million square feet of Gross Leasable Area (“GLA”).
As of December 31, 2023, our total debt outstanding before deferred financing costs and original issue discount was $2.43 billion, including $44.9 million of secured mortgage debt that had a weighted average fixed interest rate of 3.78% and a weighted average maturity of 5.8 years, $2.16 billion of unsecured borrowings, which includes $350.0 million of unsecured term loans and $1.81 billion of unsecured notes, that had a weighted average fixed interest rate of 3.50% (including the effects of interest rate swap agreements) and a weighted average maturity of 6.5 years, and $227.0 million of floating rate borrowings under our revolving credit facility at a weighted average interest rate of approximately 6.27%.
As of December 31, 2024, our total debt outstanding before deferred financing costs and original issue discount was $2.81 billion, including $43.9 million of secured mortgage debt that had a weighted average fixed interest rate of 3.73% and a weighted average maturity of 4.8 years, $2.61 billion of unsecured borrowings, which includes $350.0 million of unsecured term loans and $2.26 billion of unsecured notes, that had a weighted average fixed interest rate of 3.87% (including the effects of interest rate swap agreements) and a weighted average maturity of 6.2 years, and $158.0 million of floating rate borrowings under our Revolving Credit Facility at an interest rate of approximately 5.29%.
The portfolio was approximately 99.8% leased and had a weighted average remaining lease term of approximately 8.4 years.
The portfolio was approximately 99.6% leased and had a weighted average remaining lease term of approximately 7.9 years.
Dividends The Company increased its monthly dividend per common share from $0.24 to $0.243 in April 2023 and further increased the monthly dividend per common share to $0.247 in October 2023.
Dividends The Company increased its monthly dividend per common share from $0.247 to $0.25 in April 2024 and further increased the monthly dividend per common share to $0.253 in October 2024.
Alignment of individual, team, corporate and stockholder objectives provides for continuity, teamwork and increased collaboration. Our team members are paid commensurate with their qualifications, responsibilities, productivity, quality of work and adherence to our core values. The Agree Culture Committee is composed of team members from departments throughout the organization.
Our team members are paid commensurate with their qualifications, responsibilities, productivity, quality of work and adherence to our core values. The Agree Culture Committee is composed of team members from departments throughout the organization.
We are committed to managing the Company for the benefit of our stockholders and are focused on maintaining good corporate governance. Our board of directors has 10 directors, eight of whom are independent, including the Company’s new independent director added in 2024. Six new independent directors have been added since 2018.
We are committed to managing the Company for the benefit of our stockholders and are focused on maintaining good corporate governance. Our board of directors has 10 directors, eight of whom are independent. Six new independent directors have been added since 2018. Independent directors meet regularly, without the presence of officers or team members.
In addition to its common dividends, the Company paid monthly cash dividends on its 4.25% Series A Cumulative Redeemable Preferred Stock. Financing Equity In September 2022, the Company entered into a $750 million at-the-market (“ATM”) program (the “2022 ATM Program”) through which the Company, from time to time, may sell shares of common stock and/or enter into forward sale agreements.
In addition to its common dividends, the Company paid monthly cash dividends on its 4.25% Series A Cumulative Redeemable Preferred Stock. Financing Equity The Company enters into at-the-market (“ATM”) programs through which the Company, from time to time, sells shares of common stock and/or enters into forward sale agreements.
Total investment volume includes the acquisition of 282 properties for an aggregate purchase price of approximately $1.19 billion, and the completed development of 21 properties for an aggregate cost of approximately $86.2 million. These 303 properties are net leased to tenants operating in 27 sectors and are located in 40 states.
Total investment volume includes the acquisition of 242 properties for an aggregate purchase price of approximately $866.6 million, and the completed development of 21 properties for an aggregate cost of approximately $72.7 million. These properties are net leased to tenants operating in 27 sectors and are located in 45 states.
The December 2023 dividend per share of $0.247 represents an annualized dividend of $2.964 per share and an annualized dividend yield of approximately 4.7% based on the last reported sales price of our common stock listed on the NYSE of $62.95 on December 29, 2023. The Company has routinely paid cash dividends to our common shareholders.
The December 2024 dividend per share of $0.253 represents an annualized dividend of $3.036 per share and an annualized dividend yield of approximately 4.3% based on the last reported sales price of our common stock listed on the NYSE of $70.45 on December 31, 2024. The Company has routinely paid cash dividends to our common shareholders.
Insurance coverages are provided for all team members and their dependents, including medical, dental, vision, disability, and life insurance.
Insurance coverages are provided for all team members and their dependents, including medical, dental, vision, disability, and life insurance. The Company pays 100% of short-term, long-term, and life insurance premiums for team members and their families.
We will continue working with our tenants and consultant to update our greenhouse gas emissions inventory. ​ Social Company Culture and Team Members The Agree Wellness Program focuses on physical and financial wellness to enhance team members’ well-being.
We continue working with our tenants and consultant to update our greenhouse gas emissions inventory. ​ Social, Company Culture and Team Members The “Agree Wellness Program” focuses on physical and financial wellness to enhance team members’ well-being. The Company believes that team members who are healthy, fit, financially secure and motivated are team members who achieve personal and professional success.
Performance-based pay aligns the interests of management with the interests of our stockholders and motivates and rewards individual efforts and company success. ● Align executives’ and team members’ long-term interests with those of our stockholders. The Company seeks to align these interests by providing a significant portion of executive officer compensation in the form of restricted common stock.
Performance-based pay aligns the interests of management with the interests of our stockholders and motivates and rewards individual efforts and company success. ● Align executives’ and team members’ long-term interests with those of our stockholders.
Substantially all of our tenants are subject to net lease agreements. A net lease typically requires the tenant to be responsible for minimum monthly rent and property operating expenses including property taxes, insurance and maintenance. As of December 31, 2023, the Company had 72 full-time employees, covering acquisitions, development, legal, asset management, accounting, finance, administrative and executive functions.
Substantially all of our tenants are subject to net lease agreements. A net lease typically requires the tenant to be responsible for minimum monthly rent and property operating expenses including property taxes, insurance and maintenance.
The Company used the existing $350 million of forward starting interest rate swaps to hedge the variable SOFR priced interest to a weighted average fixed rate of 3.57% until January 2029. 3 Table of Contents Business Strategies Our primary business objectives are to capitalize on distinct market positioning in the retail net lease space, focus on 21st century industry-leading retailers through our external growth platforms, leverage our real estate acumen and relationships to identify superior risk-adjusted opportunities, maintain a conservative and flexible capital structure that enables growth, and provide consistent, high-quality earnings growth and a well-covered growing dividend.
As of December 31, 2024, the Revolving Credit Facility had a $158.0 million outstanding balance and bore interest of 5.29%, which is comprised of SOFR of 4.46%, the pricing grid spread of 72.5 basis points, and the 10 basis point SOFR adjustment. 4 Table of Contents Business Strategies Our primary business objectives are to capitalize on distinct market positioning in the retail net lease space, focus on 21st century industry-leading retailers through our external growth platforms, leverage our real estate acumen and relationships to identify superior risk-adjusted opportunities, maintain a conservative and flexible capital structure that enables growth, and provide consistent, high-quality earnings growth and a well-covered growing dividend.
The Company does not have a stockholder rights plan (“poison pill”) and maintains stock ownership guidelines for directors and named executive officers requiring specified levels of stock ownership.
A Lead Independent Director was appointed in 2019. The board of directors has adopted an insider trading policy that applies to all directors, officers and team members. The Company does not have a stockholder rights plan (“poison pill”) and maintains stock ownership guidelines for directors and certain executive officers requiring specified levels of stock ownership.
These assets are 100% leased for a weighted average lease term of approximately 11.4 years. 2 Table of Contents During 2023, the Company sold six assets, including one former corporate headquarters office building, for net proceeds of $13.8 million.
These assets are leased for a weighted average lease term of approximately 10.6 years. 2 Table of Contents During 2024, the Company sold 26 assets and land parcels for net proceeds of $94.3 million and recorded a net gain of $11.5 million.
The Company supports healthy living through enhanced health insurance, an on-site gym, training and education, various complementary meal programs and many other benefits. We support team members with generous cash compensation plans, equity ownership programs, retirement plans and ongoing access to financial planning resources. Team members are compensated for their performance and rewarded for their outstanding work.
We support team members with cash compensation plans, equity ownership programs, retirement plans and ongoing access to financial planning resources. Team members are compensated for their performance and rewarded for their outstanding work. Alignment of individual, team, corporate and stockholder objectives provides for continuity, teamwork and increased collaboration.
As of December 31, 2023, the Company completed forward sale agreements under the 2022 ATM Program for 10,197,230 shares of common stock, for anticipated future net proceeds of $669.1 million, after deducting fees and expenses.
(3) After considering the shares of common stock sold subject to forward sale agreements under the October 2024 ATM Program, the Company had approximately $1.24 billion of availability under the October 2024 ATM Program as of December 31, 2024.
Removed
The Company has settled 6,363,359 shares of these forward sale agreements as of December 31, 2023 for net proceeds of approximately $433.4 million, after deducting fees and expenses. The Company is required to settle the remaining forward agreements by January 2025. The Company had approximately $75.8 million of availability remaining under the 2022 ATM Program as of December 31, 2023.
Added
As of December 31, 2024, the Company had 75 full-time employees, covering accounting, acquisitions, asset management, development and construction, finance, information technology, legal, and people and culture. The Company was incorporated in December 1993 under the laws of the State of Maryland.
Removed
Debt In July 2023, the Company closed on an unsecured $350 million 5.5-year term loan (the “2029 Unsecured Term Loan”) which includes an accordion option that allows the Company to request additional lender commitments up to a total of $500 million and matures in January 2029.
Added
In October 2024, the Company entered into a $1.25 billion ATM program (the “October 2024 ATM Program”). The previous $1.00 billion ATM program (the “February 2024 ATM Program”) was terminated following the establishment of the October 2024 ATM Program.
Removed
Borrowings under the 2029 Unsecured Term Loan are priced at SOFR plus a spread of 80 to 160 basis points over SOFR, depending on the Company’s credit ratings, plus a SOFR adjustment of 10 basis points. Based on the Company’s credit ratings at the time of closing, pricing on the 2029 Unsecured Term Loan was 95 basis points over SOFR.
Added
As a result, no future issuances will occur under the February 2024 ATM Program. 3 Table of Contents The following table summarizes the ATM programs that were in place during the years ended December 31, 2024, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Program Year ​ Program Size ($ million) ​ Total Forward Shares Sold ​ Total Forward Shares Settled ​ Total Forward Shares Outstanding as of December 31, 2024 ​ Total Net Proceeds Anticipated or Received from Shares Sold ($ million) February 2021 * $500.0 ​ 5,453,975 ​ 5,453,975 ​ - ​ $379.1 September 2022 * $750.0 ​ 10,217,973 ​ 10,217,973 ​ - ​ $670.3 February 2024 * $1,000.0 ​ 10,409,017 ​ 2,775,498 ​ 7,633,519 (1) ​ $706.0 October 2024 ​ $1,250.0 ​ 168,277 (3) ​ - ​ 168,277 (2) ​ $12.9 *Applicable ATM program terminated and no future forward sales will occur under the program.
Removed
Independent directors meet regularly, without the presence of officers or team members. A Lead Independent Director was appointed in 2019. The board of directors has adopted an insider trading policy that applies to all directors, officers and team members.
Added
(1) The Company is required to settle the outstanding shares of common stock under the February 2024 ATM Program between June 2025 and October 2025. (2) The Company is required to settle the outstanding shares of common stock under the October 2024 ATM Program by June 2026.
Added
The following table summarizes the ATM activity completed during the years ended December 31, 2024, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ 2023 ​ 2022 ​ Shares of common stock sold under the ATM programs ​ 10,598,037 ​ 5,846,998 ​ 7,678,911 ​ Shares of common stock settled under the ATM programs ​ 6,630,112 ​ 6,117,768 ​ 5,699,566 ​ Net proceeds received (in millions) ​ $403.8 ​ $415.4 ​ $397.2 ​ ​ Debt In May 2024, the Operating Partnership completed an underwritten public offering of $450.0 million in aggregate principal amount of its 5.625% Notes due 2034 (the “2034 Senior Unsecured Public Notes”).
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The public offering was priced at 98.83% of the principal amount, resulting in net proceeds of $444.7 million. Upon completion of the underwritten public offering, the Company terminated $150.0 million of forward-starting interest rate swap agreements as well as the $150.0 million US Treasury lock that hedged the 2034 Senior Unsecured Public Notes, receiving $4.4 million, net upon termination.
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The proceeds from the underwritten public offering were used for general corporate purposes, including to reduce amounts outstanding under the Revolving Credit Facility (as defined below) and to fund property acquisitions and development activity.
Added
In August 2024, the Company entered into the Fourth Amended and Restated Revolving Credit Agreement which provides a $1.25 billion senior unsecured revolving credit facility (the “Revolving Credit Facility”).
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The Revolving Credit Facility's interest rate is based on a pricing grid with a range of 72.5 to 140 basis points over SOFR, determined by the Company's credit ratings and leverage ratio, plus a SOFR adjustment of 10 basis points.
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The margins for the Revolving Credit Facility are subject to adjustment based on changes in the Company's leverage ratio and credit ratings.
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The Company seeks to align these interests by providing a significant portion of executive officer compensation in the form of restricted common stock and performance units.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn addition, our bylaws contain a provision exempting from the control share acquisition statute Richard Agree, Edward Rosenberg, any spouses or the foregoing, any brothers or sisters of the foregoing, any ancestors of the foregoing, any other lineal descendants of any of the foregoing, any estates of any of the foregoing, any trusts established for the benefit of any of the foregoing and any other entity controlled by any of the foregoing, our other officers, our team members, any of the associates or affiliates of the foregoing and any other person acting in concert of as a group with any of the foregoing.
Biggest changeRichard Agree or any other person acting in concert or as a group with Mr. Richard Agree. In addition, our bylaws contain a provision exempting any and all acquisitions by any person of shares of our stock from the control share acquisition statute.
Potential consequences of changes in economic and financial conditions include: ● Changes in the performance of our tenants, which may result in lower rent and lower recoverable expenses that the tenant can afford to pay and tenant defaults under the leases; ● Current or potential tenants may delay or postpone entering into long-term net leases with us; ● The ability to borrow on terms and conditions that we find acceptable may be limited or unavailable, which could reduce our ability to pursue acquisition and development opportunities and refinance existing debt, reduce our returns from acquisition and development activities, reduce our ability to make cash distributions to our stockholders and increase our future interest expense; ● Our ability to access the capital markets may be restricted at a time when we would like, or need, to access those markets, which could have an impact on our flexibility to react to changing economic and business conditions; ● The recognition of impairment charges on or reduced values of our properties, which may adversely affect our results of operations or limit our ability to dispose of assets at attractive prices and may reduce the availability of buyer financing; and ● One or more lenders under our revolving credit facility could fail and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all. ​ We are also limited in our ability to reduce costs to offset the results of a prolonged or severe economic downturn given certain fixed costs and commitments associated with our operations, which could materially impact our results of operations and/or financial condition. 9 Table of Contents Our business is significantly dependent on single tenant properties.
Potential consequences of changes in economic and financial conditions include: ● Changes in the performance of our tenants, which may result in lower rent and lower recoverable expenses that the tenant can afford to pay and tenant defaults under the leases; ● Current or potential tenants may delay or postpone entering into long-term net leases with us; ● The ability to borrow on terms and conditions that we find acceptable may be limited or unavailable, which could reduce our ability to pursue acquisition and development opportunities and refinance existing debt, reduce our returns from acquisition and development activities, reduce our ability to make cash distributions to our stockholders and increase our future interest expense; ● Our ability to access the capital markets may be restricted at a time when we would like, or need, to access those markets, which could have an impact on our flexibility to react to changing economic and business conditions; ● The recognition of impairment charges on or reduced values of our properties, which may adversely affect our results of operations or limit our ability to dispose of assets at attractive prices and may reduce the availability of buyer financing; and ● One or more lenders under our revolving credit facility could fail and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all. ​ We are also limited in our ability to reduce costs to offset the results of a prolonged or severe economic downturn given certain fixed costs and commitments associated with our operations, which could materially impact our results of operations and/or financial condition. 10 Table of Contents Our business is significantly dependent on single tenant properties.
Certain provisions of Maryland law may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under certain circumstances that otherwise could provide the holders of shares of our common stock with the opportunity to realize a premium over the then prevailing market price of such shares, including: ● “Business combination” provisions that, subject to limitations, prohibit certain business combinations between us and an “interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our shares or an affiliate thereof) for five years after the most recent date on which the stockholder becomes an interested stockholder and thereafter would require the recommendation of our board of directors and impose special appraisal rights and special stockholder voting requirements on these combinations; and ● “Control share” provisions that provide that “control shares” of our company (defined as shares which, when aggregated with other shares controlled by the stockholder, entitle the stockholder to exercise one of three increasing ranges of voting power in electing directors) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of “control shares”) have no voting rights except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares.
Certain provisions of Maryland law may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under certain circumstances that otherwise could provide the holders of shares of our common stock with the opportunity to realize a premium over the then prevailing market price of such shares, including: ● “Business combination” provisions that, subject to limitations, prohibit certain business combinations between us and an “interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our shares or an affiliate thereof) for five years after the most recent date on which the stockholder 18 Table of Contents becomes an interested stockholder and thereafter would require the recommendation of our board of directors and impose special appraisal rights and special stockholder voting requirements on these combinations; and ● “Control share” provisions that provide that “control shares” of our company (defined as shares which, when aggregated with other shares controlled by the stockholder, entitle the stockholder to exercise one of three increasing ranges of voting power in electing directors) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of “control shares”) have no voting rights except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares.
Income from and the value of our properties may be adversely affected by: ● Changes in general or local economic conditions; ● The attractiveness of our properties to potential tenants; ● Changes in supply of or demand for similar or competing properties in an area; ● Bankruptcies, financial difficulties or lease defaults by our tenants; ● Changes in operating costs and expense and our ability to control rents; ● Our ability to lease properties at favorable rental rates; ● Our ability to sell a property when we desire to do so at a favorable price; ● Property damage or casualty loss; ● Impacts of climate change; ● The potential risk of functional obsolescence of properties over time; ● Changes in or increased costs of compliance with governmental rules, regulations and fiscal policies, including changes in the ADA and similar regulations and tax, real estate, environmental and zoning laws, and our potential liability thereunder. ​ Economic and financial market conditions have and may continue to exacerbate many of the foregoing risks.
Income from and the value of our properties may be adversely affected by: ● Changes in general or local economic conditions; ● The attractiveness of our properties to potential tenants; ● Changes in supply of or demand for similar or competing properties in an area; ● Bankruptcies, financial difficulties or lease defaults by our tenants; ● Changes in operating costs and expense and our ability to control rents; ● Our ability to lease properties at favorable rental rates; ● Our ability to sell a property when we desire to do so at a favorable price; ● Property damage or casualty loss; ● Impacts of climate change; ● The potential risk of functional obsolescence of properties over time; ● Changes in interest rates and the availability of financing; ● Changes in or increased costs of compliance with governmental rules, regulations and fiscal policies, including changes in the ADA and similar regulations and tax, real estate, environmental and zoning laws, and our potential liability thereunder. ​ Economic and financial market conditions have and may continue to exacerbate many of the foregoing risks.
Acquisitions entail risks that investments will fail to perform in accordance with expectations, as well as general investment risks associated with any new real estate investment. 10 Table of Contents Loss of revenues from tenants would reduce the Company’s cash flow. Our tenants encounter significant macroeconomic, governmental and competitive forces.
Acquisitions entail risks that investments will fail to perform in accordance with expectations, as well as general investment risks associated with any new real estate investment. 11 Table of Contents Loss of revenues from tenants would reduce the Company’s cash flow. Our tenants encounter significant macroeconomic, governmental and competitive forces.
An officer and director may have interests that conflict with the interests of stockholders. An officer and member of our board of directors owns Operating Partnership Units.
An officer and director may have interests that conflict with the interests of stockholders. An officer and member of our board of directors owns Operating Partnership Common Units.
In addition, in general, no more than 5% of the total value of our assets (other than government securities, securities of TRSs and qualified real estate assets) can consist of securities of any one issuer, and no more than 20% of the total value of our assets can be represented by one or more TRSs.
In addition, in general, no more than 5% of the total value of our assets (other than government securities, securities of TRSs and qualified real estate assets) can consist of securities of any one issuer, and no more than 20 Table of Contents 20% of the total value of our assets can be represented by one or more TRSs.
Our directors are divided into three classes serving three-year staggered terms. The staggering of our board of directors may discourage offers for the Company or make an acquisition more difficult, even when an acquisition may be viewed to be in the best interest of our stockholders. 16 Table of Contents We could issue stock without stockholder approval.
Our directors are divided into three classes serving three-year staggered terms. The staggering of our board of directors may discourage offers for the Company or make an acquisition more difficult, even when an acquisition may be viewed to be in the best interest of our stockholders. We could issue stock without stockholder approval.
A REIT that annually distributes at least 90% of its taxable income to its stockholders generally is not taxed at the corporate level on such distributed income. We have not requested and do not plan to request a ruling from the Internal Revenue Service (the “IRS”) that we qualify as a REIT.
A REIT that annually distributes at least 90% of its taxable income to its 19 Table of Contents stockholders generally is not taxed at the corporate level on such distributed income. We have not requested and do not plan to request a ruling from the Internal Revenue Service (the “IRS”) that we qualify as a REIT.
Other legislative proposals could be enacted in the future that could affect REITs and their 18 Table of Contents stockholders. Prospective investors are urged to consult their tax advisors regarding the effect of these tax law changes and any other potential tax law changes on an investment in our common stock.
Other legislative proposals could be enacted in the future that could affect REITs and their stockholders. Prospective investors are urged to consult their tax advisors regarding the effect of these tax law changes and any other potential tax law changes on an investment in our common stock.
There can be no assurance that we will be able to retain tenants in any of our properties upon the expiration of their leases. Our leases contain certain limitations on tenants’ real estate tax, insurance and operating cost reimbursement obligations.
There can be no assurance that we will be able to retain tenants in any of our properties upon the expiration of their leases. 14 Table of Contents Our leases contain certain limitations on tenants’ real estate tax, insurance and operating cost reimbursement obligations.
In addition, losses in our TRSs will generally not provide any tax benefit, except for being carried forward against future taxable income in the TRSs. 20 Table of Contents General Risks Loss of our key personnel could materially impair our ability to operate successfully.
In addition, losses in our TRSs will generally not provide any tax benefit, except for being carried forward against future taxable income in the TRSs. General Risks Loss of our key personnel could materially impair our ability to operate successfully.
Cybersecurity incidents could cause 11 Table of Contents operational interruption, damage to our business relationships, private data exposure (including personally identifiable information, or proprietary and confidential information, of ours and our team members, as well as third parties) and affect the efficiency of our business operations.
Cybersecurity incidents could cause operational interruption, damage to our business relationships, private data exposure (including personally identifiable information, or proprietary and confidential information, of ours and our team members, as well as third parties) and affect the efficiency of our business operations.
Moreover, the existence of any material weakness or significant deficiency in our internal controls and procedures may require management to devote significant time and incur significant expense to remediate any such material weaknesses or significant deficiencies and management may not be able to remediate any such material weaknesses or significant deficiencies in a timely manner.
Moreover, the existence of any material weakness or significant deficiency in our internal controls and 22 Table of Contents procedures may require management to devote significant time and incur significant expense to remediate any such material weaknesses or significant deficiencies and management may not be able to remediate any such material weaknesses or significant deficiencies in a timely manner.
We may be required to invest in the restoration or modification 12 Table of Contents of a property before we can sell it, or we may need to obtain landlord consent to sell certain assets in which we have a leasehold interest in the land underlying the buildings.
We may be required to invest in the restoration or modification of a property before we can sell it, or we may need to obtain landlord consent to sell certain assets in which we have a leasehold interest in the land underlying the buildings.
A majority of our leases require our tenants to comply with environmental laws and to indemnify us against environmental liability arising from the operation of the properties. However, we could be subject to strict liability under environmental 13 Table of Contents laws because we own the properties.
A majority of our leases require our tenants to comply with environmental laws and to indemnify us against environmental liability arising from the operation of the properties. However, we could be subject to strict liability under environmental laws because we own the properties.
However, there are certain losses, including losses from environmental liabilities, terrorist acts or catastrophic acts of nature, that are not generally insured against or that are not generally fully insured against because it is not deemed economically feasible or prudent to do so.
However, there are certain losses, including losses from environmental liabilities, terrorist acts or catastrophic acts of nature, that are not generally insured against or that are not generally fully insured against because it is not deemed 15 Table of Contents economically feasible or prudent to do so.
To the extent that we and our affiliates are required to pay federal, state and local taxes, we will have less cash available for distributions to our stockholders. Dividends payable by REITs do not qualify for the reduced tax rates on dividend income from regular corporations.
To the extent that we and our affiliates are required to pay federal, state and local taxes, we will have less cash available for distributions to our stockholders. 21 Table of Contents Dividends payable by REITs do not qualify for the reduced tax rates on dividend income from regular corporations.
Any scrutiny of our sustainability disclosures or our failure to achieve related strategies, commitments and targets could negatively impact our reputation or performance. General Real Estate Risk Our performance and value are subject to general economic conditions and risks associated with our real estate assets. There are risks associated with owning and leasing real estate.
Any scrutiny of our sustainability disclosures or our failure to achieve related strategies, commitments and targets could negatively impact our reputation or performance. 13 Table of Contents General Real Estate Risks Our performance and value are subject to general economic conditions and risks associated with our real estate assets. There are risks associated with owning and leasing real estate.
If we are compelled to liquidate our investments to repay obligations to our lenders, we may be unable to comply with these requirements, ultimately jeopardizing our qualification as a REIT, or we may be subject to a 100% tax on any gain if we sell assets in transactions that are considered to be “prohibited transactions,” which are explained in the risk factor below. 19 Table of Contents We may be subject to other tax liabilities even if we qualify as a REIT.
If we are compelled to liquidate our investments to repay obligations to our lenders, we may be unable to comply with these requirements, ultimately jeopardizing our qualification as a REIT, or we may be subject to a 100% tax on any gain if we sell assets in transactions that are considered to be “prohibited transactions,” which are explained in the risk factor below.
An epidemic or pandemic (such as the outbreak and worldwide spread of COVID-19), and the measures that international, federal, state and local governments, agencies, law enforcement and/or health authorities implement to address it, may precipitate or materially exacerbate one or more of the other risks, and may significantly disrupt our tenants’ ability to operate their businesses and/or pay rent to us or prevent us from operating our business in the ordinary course for an extended period. 21 Table of Contents An epidemic or pandemic could have a material and adverse effect on or cause disruption to our business or financial condition, results of operations, cash flows and the market value and trading price of our securities due to, among other factors: ● A complete or partial closure of, or other operational issues at, one or more of our properties resulting from government or tenant action; ● Reduced economic activity could severely impact our tenants’ businesses, financial condition and liquidity and may cause one or more of our tenants to be unable to meet their obligations to us in full, or at all, or to otherwise seek modifications of such obligations; ● Reduced economic activity could result in a prolonged recession, which could negatively impact consumer discretionary spending; ● Difficulty accessing debt and equity capital on attractive terms, or at all, potential impacts to our credit ratings, and a prolonged severe disruption and instability in the global financial markets or deteriorations in credit and financing conditions may affect our access to capital necessary to fund business operations or address maturing liabilities on a timely basis and our tenants’ ability to fund their business operations and meet their obligations to us; ● Negative impacts to our future compliance with financial covenants of our Revolving Credit Facility and other debt agreements could result in a default and potentially an acceleration of indebtedness, which non-compliance could negatively impact our ability to make additional borrowings under our Revolving Credit Facility and pay dividends; ● Any impairment in value of our tangible or intangible assets which could be recorded as a result of weaker economic conditions; ● A decline in business activity and demand for real estate transactions could adversely affect our ability or desire to grow our portfolio of properties; ● A deteriorati on in our or our tenants’ ability to operate in affected areas or delays in the supply of products or services to us or our tenants from vendors that are needed for our or our tenants’ efficient operations could adversely affect our operations and those of our tenants; and ● The potential negative impact on the health of our personnel, particularly if a significant number of them are impacted, could result in a deterioration in our ability to ensure business continuity during this disruption.
An epidemic or pandemic could have a material and adverse effect on or cause disruption to our business or financial condition, results of operations, cash flows and the market value and trading price of our securities due to, among other factors: ● A complete or partial closure of, or other operational issues at, one or more of our properties resulting from government or tenant action; ● Reduced economic activity could severely impact our tenants’ businesses, financial condition and liquidity and may cause one or more of our tenants to be unable to meet their obligations to us in full, or at all, or to otherwise seek modifications of such obligations; ● Reduced economic activity could result in a prolonged recession, which could negatively impact consumer discretionary spending; ● Difficulty accessing debt and equity capital on attractive terms, or at all, potential impacts to our credit ratings, and a prolonged severe disruption and instability in the global financial markets or deteriorations in credit and financing conditions may affect our access to capital necessary to fund business operations or address maturing liabilities on a timely basis and our tenants’ ability to fund their business operations and meet their obligations to us; ● Negative impacts to our future compliance with financial covenants of our Revolving Credit Facility and other debt agreements could result in a default and potentially an acceleration of indebtedness, which non-compliance could negatively impact our ability to make additional borrowings under our Revolving Credit Facility and pay dividends; ● Any impairment in value of our tangible or intangible assets which could be recorded as a result of weaker economic conditions; 23 Table of Contents ● A decline in business activity and demand for real estate transactions could adversely affect our ability or desire to grow our portfolio of properties; ● A deteriorati on in our or our tenants’ ability to operate in affected areas or delays in the supply of products or services to us or our tenants from vendors that are needed for our or our tenants’ efficient operations could adversely affect our operations and those of our tenants; and ● The potential negative impact on the health of our personnel, particularly if a significant number of them are impacted, could result in a deterioration in our ability to ensure business continuity during this disruption.
Our tenants are concentrated in certain retail sectors, which makes us susceptible to adverse conditions impacting these sectors. As of December 31, 2023, 9.6%, 8.7% and 8.6% of our annualized contractual base rent and interest were derived from tenants operating in the grocery store, home improvement, and tire and auto service sectors, respectively.
Our tenants are concentrated in certain retail sectors, which makes us susceptible to adverse conditions impacting these sectors. As of December 31, 2024, 9.2%, 9.2% and 8.1% of our annualized base rents were derived from tenants operating in the grocery store, home improvement, and tire and auto service sectors, respectively.
At December 31, 2023, our ratio of total debt to enterprise value (assuming conversion of Operating Partnership Common Units into shares of common stock) was approximately 27.2%.
At December 31, 2024, our ratio of total debt to enterprise value (assuming conversion of Operating Partnership Common Units into shares of common stock) was approximately 26.6%.
Future offerings of debt and equity may not be available to us or may adversely affect the market price of our common stock. We expect to continue to increase our capital resources by making additional offerings of equity and debt securities in the future, which could include classes or series of preferred stock, common stock and senior or subordinated notes.
We expect to continue to increase our capital resources by making additional offerings of equity and debt securities in the future, which could include classes or series of preferred stock, common stock and senior or subordinated notes.
Similarly, we have concentrations in other sectors such as dollar stores, convenience stores, and general merchandise.
Similarly, we have concentrations in other sectors such as convenience stores, dollar stores and auto parts.
If our debt capitalization policy were changed, we could become more highly leveraged, resulting in an increase in debt service that could adversely affect our operating cash flow and our ability to make expected distributions to stockholders, and could result in an increased risk of default on our obligations.
If our debt capitalization policy were changed, we could become more highly leveraged, resulting in an increase in debt service that could adversely affect our operating cash flow and our ability to make expected distributions to stockholders, and could result in an increased risk of default on our obligations. 16 Table of Contents Covenants in our credit agreements and note purchase agreements could limit our flexibility and adversely affect our financial condition.
The determination of various factual matters and circumstances not entirely within our control may affect our ability to qualify as a REIT. Additionally, our charter provides our board of directors with the power, under certain circumstances, to revoke or otherwise terminate our REIT election and cause us to be taxed as a regular corporation, without the approval of our stockholders.
Additionally, our charter provides our board of directors with the power, under certain circumstances, to revoke or otherwise terminate our REIT election and cause us to be taxed as a regular corporation, without the approval of our stockholders.
This individual may have personal interests that conflict with the interests of our stockholders with respect to business decisions affecting us and the Operating Partnership, such as interests in the timing and pricing of property sales or refinancing in order to obtain favorable tax treatment. 17 Table of Contents Federal Income Tax Risks Complying with REIT requirements may cause us to forego otherwise attractive opportunities.
This individual may have personal interests that conflict with the interests of our stockholders with respect to business decisions affecting us and the Operating Partnership, such as interests in the timing and pricing of property sales or refinancing in order to obtain favorable tax treatment.
Incurring substantial debt may adversely affect our business and operating results by: ● Requiring us to use a substantial portion of our cash flow to pay interest and principal, which reduces the amount available for distributions, acquisitions and capital expenditures; ● Making us more vulnerable to economic and industry downturns and reducing our flexibility to respond to changing business and economic conditions; ● Requiring us to agree to less favorable terms, including higher interest rates, in order to incur additional debt, and otherwise limiting our ability to borrow for operations, working capital or to finance acquisitions in the future; or ● Limiting our flexibility in conducting our business, including our ability to finance or refinance our assets, contribute assets to joint ventures or sell assets as needed, which may place us at a disadvantage compared to competitors with less debt or debt with less restrictive terms. 14 Table of Contents In addition, the use of leverage presents an additional element of risk in the event that (1) the cash flow from lease payments on our properties is insufficient to meet debt obligations, (2) we are unable to refinance our debt obligations as necessary or on as favorable terms, (3) there is an increase in interest rates, (4) we default on our financial obligations or (5) debt service requirements increase.
Incurring substantial debt may adversely affect our business and operating results by: ● Requiring us to use a substantial portion of our cash flow to pay interest and principal, which reduces the amount available for distributions, acquisitions and capital expenditures; ● Making us more vulnerable to economic and industry downturns and reducing our flexibility to respond to changing business and economic conditions; ● Requiring us to agree to less favorable terms, including higher interest rates, in order to incur additional debt, and otherwise limiting our ability to borrow for operations, working capital or to finance acquisitions in the future; or ● Limiting our flexibility in conducting our business, including our ability to finance or refinance our assets, contribute assets to joint ventures or sell assets as needed, which may place us at a disadvantage compared to competitors with less debt or debt with less restrictive terms.
Any preferred shares we may offer may have a fixed dividend rate that would not increase with any increases in the dividend rate of our common stock. Conversely, payment of dividends on our common stock is subject to payment in full of the dividends on any preferred shares and payment of interest on any debt securities we may offer.
Any preferred shares we may offer may have a fixed dividend rate that would not increase with any increases in the dividend rate of our common stock.
To qualify as a REIT for federal income tax purposes we must continually satisfy numerous income, asset and other tests, thus having to forego investments we might otherwise make and hindering our investment performance. Failure to qualify as a REIT could adversely affect our operations and our ability to make distributions.
Federal Income Tax Risks Complying with REIT requirements may cause us to forego otherwise attractive opportunities. To qualify as a REIT for federal income tax purposes we must continually satisfy numerous income, asset and other tests, thus having to forego investments we might otherwise make and hindering our investment performance.
These cross-default provisions may require us to repay or restructure the revolving credit facility in addition to any mortgage or other debt that is in default.
Our financing agreements contain certain cross-default provisions which could be triggered in the event that we default on our other indebtedness. These cross-default provisions may require us to repay or restructure the revolving credit facility in addition to any mortgage or other debt that is in default.
Such cyber-attacks can range from individual attempts to gain unauthorized access to our information technology systems to more sophisticated security threats. While we employ a number of measures to prevent, detect and mitigate these threats, there is no guarantee such efforts will be successful in preventing a cyber-attack.
While we employ a number of measures to prevent, detect and mitigate these threats, there is no guarantee such efforts will be successful in preventing a cyber-attack.
Even if we remain qualified as a REIT for federal income tax purposes, we will be required to pay certain federal, state and local taxes on our income and property. For example, we will be subject to federal income tax on any of our REIT taxable income (including capital gains) that we do not distribute annually to our stockholders.
For example, we will be subject to federal income tax on any of our REIT taxable income (including capital gains) that we do not distribute annually to our stockholders.
Our properties are located in 49 states throughout the United States and in particular, the state of Texas (where 143 properties out of 2,135 properties are located, or 7.2% of our annualized base rent was derived as of December 31, 2023), Florida (137 properties, or 6.1% of our annualized base rent), Illinois (124 properties, or 5.5% of our annualized base rent), North Carolina (127 properties, or 5.5% of our annualized base rent), and Ohio (133 properties, or 5.3% of our annualized rent).
Our properties are located in all 50 states throughout the United States and in particular, the state of Texas (where 151 properties out of 2,370 properties are located, or 6.8% of our annualized base rent was derived as of December 31, 2024), Illinois (140 properties, or 5.5% of our annualized base rent), Michigan (142 properties, or 5.5% of our annualized base rent), North Carolina (133 properties, or 5.2% of our annualized base rent), and Florida (129 properties, or 5.2% of our annualized rent).
Any failure, inadequacy or interruption could materially harm our business and/or damage our business relationships and our reputation. Furthermore, our business is subject to risks from and may be impacted by cybersecurity attacks or cyber intrusion, including attempts to gain unauthorized access to our confidential data and other electronic security breaches.
Furthermore, our business is subject to risks from and may be impacted by cybersecurity attacks or cyber intrusion, including attempts to gain unauthorized access to our confidential data and other electronic security breaches. Such cyber-attacks can range from individual attempts to gain unauthorized access to our information technology systems to more sophisticated security threats.
Moreover, hedging strategies involve transaction and other costs. We cannot assure you that our hedging strategy and the derivatives that we use will adequately offset the risk of interest rate volatility or that our hedging transactions will not result in losses that may reduce the overall return on your investment.
We cannot assure you that our hedging strategy and the derivatives that we use will adequately offset the risk of interest rate volatility or that our hedging transactions will not result in losses that may reduce the overall return on your investment. 17 Table of Contents Future offerings of debt and equity may not be available to us or may adversely affect the market price of our common stock.
These covenants may limit our flexibility in our operations, and breaches of these covenants could result in defaults under the instruments governing the applicable indebtedness even if we have satisfied our payment obligations. Our financing agreements contain certain cross-default provisions which could be triggered in the event that we default on our other indebtedness.
The terms of the financing agreements and other indebtedness require us to comply with a number of customary financial and other covenants. These covenants may limit our flexibility in our operations, and breaches of these covenants could result in defaults under the instruments governing the applicable indebtedness even if we have satisfied our payment obligations.
These risks could be exacerbated by a deterioration in the financial condition of any major tenant with leases in multiple locations. The availability and timing of cash dividends is uncertain. We expect to continue to pay regular dividends to our stockholders.
These risks could be exacerbated by a deterioration in the financial condition of any major tenant with leases in multiple locations.
We will be subject to increased taxation if we fail to qualify as a REIT for federal income tax purposes. Although we believe that we are organized and operate in such a manner so as to qualify as a REIT under the Internal Revenue Code, no assurance can be given that we will remain so qualified.
Although we believe that we are organized and operate in such a manner so as to qualify as a REIT under the Internal Revenue Code, no assurance can be given that we will remain so qualified. Qualification as a REIT involves the application of highly technical and complex Code provisions for which there are only limited judicial or administrative interpretations.
We use various derivative financial instruments to provide a level of protection against interest rate risks, but no hedging strategy can protect us completely.
Our hedging strategies may not be successful in mitigating our risks associated with interest rates and could reduce the overall returns on your investment. We use various derivative financial instruments to provide a level of protection against interest rate risks, but no hedging strategy can protect us completely.
In such circumstances, if we are not able to offset the decrease in yields by obtaining lower interest costs on our borrowings, our results of operations may be adversely affected. 15 Table of Contents Our hedging strategies may not be successful in mitigating our risks associated with interest rates and could reduce the overall returns on your investment.
Increased competition for the acquisition of real estate may lead to a decrease in the yields on real estate targeted for acquisition. In such circumstances, if we are not able to offset the decrease in yields by obtaining lower interest costs on our borrowings, our results of operations may be adversely affected.
If we do not maintain or increase the dividend on our common stock, it could have an adverse effect on the market price of our shares. We face risks relating to information technology and cybersecurity attacks, loss of confidential information and other business disruptions.
Conversely, payment of dividends on our common stock is subject to payment in full of the dividends on any preferred shares and payment of interest on any debt securities we may offer. 12 Table of Contents If we do not maintain or increase the dividend on our common stock, it could have an adverse effect on the market price of our shares.
Environmental problems at any properties could also put us in default under loans secured by those properties, as well as loans secured by unaffected properties. Uninsured losses relating to real property may adversely affect our returns. Our leases generally require tenants to carry comprehensive liability and extended coverage insurance on our properties.
Environmental problems at any properties could also put us in default under loans secured by those properties, as well as loans secured by unaffected properties.
Qualification as a REIT involves the application of highly technical and complex Code provisions for which there are only limited judicial or administrative interpretations. The complexity of these provisions and applicable treasury regulations is also increased in the context of a REIT that holds its assets in partnership form.
The complexity of these provisions and applicable treasury regulations is also increased in the context of a REIT that holds its assets in partnership form. The determination of various factual matters and circumstances not entirely within our control may affect our ability to qualify as a REIT.
Removed
Covenants in our credit agreements and note purchase agreements could limit our flexibility and adversely affect our financial condition. The terms of the financing agreements and other indebtedness require us to comply with a number of customary financial and other covenants.
Added
Our assessment that certain businesses are more insulated from e-commerce pressure than others may prove to be incorrect, and changes in macroeconomic trends may adversely affect our tenants, either of which could impair our tenants' ability to make rental payments to us and materially and adversely affect us.
Removed
Increased competition for the acquisition of real estate may lead to a decrease in the yields on real estate targeted for acquisition.
Added
We primarily invest in properties leased to tenants in sectors where a physical location is critical to the generation of sales and profits. Such tenants operate in sectors including grocery stores, home improvement, tire and automotive services and convenience stores.
Removed
Richard Agree or any other person acting in concert or as a group with Mr. Richard Agree.
Added
We believe many of these businesses have adopted effective omni-channel strategies that leverage their brick and mortar locations as a distinct competitive advantage against online only retailers and other competitors. In addition, they generally operate in sectors that are resilient through economic cycles.
Added
While we believe this to be the case, technology and business conditions, particularly in the retail industry, are rapidly changing, and our tenants may be adversely affected by technological innovation, changing consumer preferences and competition from non-traditional sources. To the extent our tenants face increased competition their businesses could suffer.
Added
There can be no assurance that our tenants will be successful in meeting any new competition, and a deterioration in our tenants’ businesses could impair their ability to meet their lease obligations to us and materially and adversely affect us. The availability and timing of cash dividends is uncertain. We expect to continue to pay regular dividends to our stockholders.
Added
We face risks relating to information technology and cybersecurity attacks, loss of confidential information and other business disruptions.
Added
Any failure, inadequacy or interruption could materially harm our business and/or damage our business relationships and our reputation. Our clients or other third parties with whom we do business may themselves become subject to cyberattacks or security incidents, over which we may have no control, and which could have an indirect adverse impact on them, us or our business relationship.
Added
The use of artificial intelligence presents risks and challenges that may adversely impact our business and operating results or that of our tenants. We may adopt and integrate generative artificial intelligence and machine learning (collectively, “AI”) tools into our operations to enhance efficiencies and streamline existing systems. However, the deployment and maintenance of AI tools may entail substantial risks.
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While these tools hold promise in optimizing processes and driving efficiencies, as with many technological innovations, they also pose inherent risks. These include, but are not limited to, the potential for inaccuracy, bias, intellectual property infringement, or misappropriation, as well as concerns regarding data privacy and cybersecurity.
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Potential risk of use of AI by cybercriminals As AI technologies become more advanced, cybercriminals may develop more sophisticated attack methods. Such methods may include the use of AI to automate and enhance phishing schemes, advance malware, and carry out more effective cyberattacks.
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The AI-driven cyber threats could be harder to detect and counteract, which may pose significant risks to our data security and the integrity of our systems. If such AI-enhanced cyberattacks are successful, they could lead to substantial data breaches, loss of sensitive information, and significant financial and reputational damage.
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As of December 31, 2024, we have not been notified by any governmental authority of any non-compliance, liability or other claim, and are not aware of any other environmental condition that we believe will have a material adverse effect on our business, financial condition, results of operations or liquidity.
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Uninsured losses relating to real property may adversely affect our operating results and cash flows and upon renewal of our insurance policies, our coverage may change and our costs may increase. Our leases generally require tenants to carry comprehensive liability and extended coverage insurance on our properties.
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In addition, the use of leverage presents an additional element of risk in the event that (1) the cash flow from lease payments on our properties is insufficient to meet debt obligations, (2) we are unable to refinance our debt obligations as necessary or on as favorable terms, (3) there is an increase in interest rates, (4) we default on our financial obligations or (5) debt service requirements increase.
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Moreover, hedging strategies involve transaction and other costs.
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Failure to qualify as a REIT could adversely affect our operations and our ability to make distributions. We will be subject to increased taxation if we fail to qualify as a REIT for federal income tax purposes.
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We may be subject to other tax liabilities even if we qualify as a REIT. Even if we remain qualified as a REIT for federal income tax purposes, we will be required to pay certain federal, state and local taxes on our income and property.
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An epidemic or pandemic (such as the outbreak and worldwide spread of COVID-19), and the measures that international, federal, state and local governments, agencies, law enforcement and/or health authorities implement to address it, may precipitate or materially exacerbate one or more of the other risks, and may significantly disrupt our tenants’ ability to operate their businesses and/or pay rent to us or prevent us from operating our business in the ordinary course for an extended period.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn connection with improving the management of cybersecurity risk, the Company has: ● audited our systems with the help of information security consultants; ● completed ransomware simulations and enhanced our Disaster Recovery and Business Continuity Plan to reflect lessons learned; ● conducted recovery simulation of our proprietary database to determine restoration timing; ● conducted penetration testing and remediated all issues identified; and ● enhanced e-mail filtering software to limit the possibility of phishing or ransomware attacks.
Biggest changeIn connection with improving the management of cybersecurity risk, the Company has: ● audited our systems with the help of information security consultants; ● completed ransomware simulations and enhanced our Disaster Recovery and Business Continuity Plan to reflect lessons learned; ● implemented information security policies to monitor for and notify if personnel take potentially malicious actions against the company, such as forwarding sensitive emails or uploading data to non-approved cloud services; ● conducted recovery simulation of our proprietary database to determine restoration timing; ● conducted penetration testing and remediated all issues identified; and ● enhanced e-mail filtering software to limit the possibility of phishing or ransomware attacks. 25 Table of Contents Monitor Cybersecurity Incidents We have a well-defined and tested cybersecurity incident response plan, which outlines the roles and responsibilities, procedures and protocols, tools and resources, and communication and escalation channels that will be activated and implemented in the event of a cybersecurity incident.
The program follows a risk-based approach, which prioritizes the cybersecurity risks according to their likelihood and impact and allocates the appropriate resources and actions to mitigate these risks and leverages the National Institute of Standards and Technology (NIST) framework. 22 Table of Contents The program is cross-functional involving the participation and input of internal stakeholders, third-party consultants and board oversight.
The program follows a risk-based approach, which prioritizes the cybersecurity risks according to their likelihood and impact and allocates the appropriate resources and actions to mitigate these risks and leverages the National Institute of Standards and Technology (NIST) framework. The program is cross-functional involving the participation and input of internal stakeholders, third-party consultants and board oversight.
The process includes, ● conducting due diligence and background checks on the potential service providers, ● verifying their cybersecurity credentials, capabilities, and track record, ● establishing clear and specific contractual terms and conditions regarding the Company’s cybersecurity expectations, obligations, and the responsibilities of the service providers, and ● monitoring and auditing the service providers’ performance, compliance, reporting and escalation procedures for any cybersecurity issues or incidents identified. ​ Risks from Cybersecurity Threats While we face a variety of cybersecurity risks, such as phishing attempts, ransomware attacks, and unauthorized access attempts, such risks have not materially affected us to date, including our business strategy, results of operations or financial condition.
The process includes: ● conducting due diligence and background checks on the potential service providers; ● verifying their cybersecurity credentials, capabilities, and track record; 24 Table of Contents ● establishing clear and specific contractual terms and conditions regarding the Company’s cybersecurity expectations, obligations, and the responsibilities of the service providers; ● conduct quarterly business reviews of service providers including security operations performance and recommendations; and ● monitoring and auditing the service providers’ performance, compliance, reporting and escalation procedures for any cybersecurity issues or incidents identified through quarterly business reviews. ​ Risks from Cybersecurity Threats While we face a variety of cybersecurity risks, such as phishing attempts, ransomware attacks, and unauthorized access attempts, such risks have not materially affected us to date , including our business strategy, results of operations or financial condition.
As part of the board of directors and audit committee’s oversight, the Chief Information Officer (“CIO”) provides quarterly updates to the audit committee with respect to cybersecurity incidents, mitigation, and management. 23 Table of Contents Management’s Role Managing Risk Our CIO is responsible for developing and overseeing matters related to cybersecurity and serves as the Company’s Chief Information Security Officer.
As part of the board of directors and audit committee’s oversight, the Chief Information Officer (“CIO”) provides quarterly updates to the audit committee with respect to security improvement projects, cybersecurity incidents, mitigation, and management. Management’s Role Managing Risk Our CIO is responsible for developing and overseeing matters related to cybersecurity and serves as the Company’s Chief Information Security Officer.
Our executive officers, which are responsible for our day-to-day risk management practices, present to the board of directors on the material risks to our Company, including risks related to information technology and cybersecurity.
Governance Board of Directors’ Oversight Our board of directors takes an active and informed role in our risk management policies and strategies. Our executive officers, which are responsible for our day-to-day risk management practices, present to the board of directors on the material risks to our Company, including risks related to information technology and cybersecurity.
For more information about the cybersecurity risks we face, see “Item 1A – Risk Factors - We face risks relating to information technology and cybersecurity attacks, loss of confidential information and other business disruptions. ” Governance Board of Directors’ Oversight Our board of directors takes an active and informed role in our risk management policies and strategies.
For more information about the cybersecurity risks we face, see “Item 1A – Risk Factors - We face risks relating to information technology and cybersecurity attacks, loss of confidential information and other business disruptions ” and “Item 1A – Risk Factors - The use of artificial intelligence presents risks and challenges that may adversely impact our business and operating results or that of our tenants ”.
The CIO reports directly to the Chief Operating Officer, who is accountable for the overall information technology and security strategy and governance of the Company.
The CIO has over 25 years of experience in information technology and is certified as an IT Business Relationship Management Professional (BRMP®), Six Sigma Blackbelt and Lean Office Champion. The CIO reports directly to the Chief Operating Officer, who is accountable for the overall information technology and security strategy and governance of the Company.
Removed
Monitor Cybersecurity Incidents We have a well-defined and tested cybersecurity incident response plan, which outlines the roles and responsibilities, procedures and protocols, tools and resources, and communication and escalation channels that will be activated and implemented in the event of a cybersecurity incident.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeTenant Sector Base Rent (1) Base Rent Grocery Stores ​ $ 53,240 ​ 9.6 % Home Improvement ​ 48,147 ​ 8.7 % Tire and Auto Service ​ 47,661 ​ 8.6 % Convenience Stores ​ 46,135 ​ 8.3 % Dollar Stores ​ 42,310 ​ 7.6 % Off-Price Retail ​ 34,920 ​ 6.3 % General Merchandise ​ 32,331 ​ 5.8 % Auto Parts ​ 31,636 ​ 5.7 % Farm and Rural Supply ​ 29,883 ​ 5.4 % Pharmacy ​ 23,701 ​ 4.3 % Consumer Electronics ​ 21,730 ​ 3.9 % Crafts and Novelties ​ 16,915 ​ 2.9 % Discount Stores ​ 14,399 ​ 2.6 % Warehouse Clubs ​ 13,699 ​ 2.5 % Equipment Rental ​ 12,700 ​ 2.3 % Health Services ​ ​ 11,085 ​ 2.0 % Dealerships ​ ​ 10,276 ​ 1.7 % Restaurants - Quick Service ​ ​ 9,215 ​ 1.7 % Health and Fitness ​ ​ 8,660 ​ 1.6 % Specialty Retail ​ ​ 6,620 ​ 1.2 % Sporting Goods ​ ​ 6,208 ​ 1.1 % Financial Services ​ ​ 6,030 ​ 1.1 % Restaurants - Casual Dining ​ ​ 5,594 ​ 1.0 % Home Furnishings ​ ​ 4,001 ​ 0.7 % Theaters ​ ​ 3,854 ​ 0.7 % Pet Supplies ​ ​ 3,430 ​ 0.6 % Beauty and Cosmetics ​ ​ 3,233 ​ 0.6 % Shoes ​ ​ 2,875 ​ 0.5 % Entertainment Retail ​ ​ 2,323 ​ 0.4 % Apparel ​ ​ 1,531 ​ 0.3 % Miscellaneous ​ ​ 1,239 ​ 0.2 % Office Supplies ​ 784 ​ 0.1 % Total ​ $ 556,365 100.0 % (1) Represents annualized contractual base rent on a straight-line basis as of December 31, 2023. 26 Table of Contents Geographic Diversification The following table presents annualized base rents, by state, for our portfolio as of December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ($ in thousands) ​ ​ ​ ​ ​ Annualized ​ % of Ann.
Biggest changeTenant Sector Base Rent (1) Base Rent Grocery Stores ​ $ 57,424 ​ 9.2 % Home Improvement ​ 56,977 ​ 9.2 % Tire and Auto Service ​ 50,125 ​ 8.1 % Convenience Stores ​ 46,546 ​ 7.5 % Dollar Stores ​ 45,076 ​ 7.3 % Auto Parts ​ 39,893 ​ 6.4 % Off-Price Retail ​ 38,579 ​ 6.2 % General Merchandise ​ 33,904 ​ 5.5 % Farm and Rural Supply ​ 32,572 ​ 5.2 % Consumer Electronics ​ 24,581 ​ 4.0 % Pharmacy ​ 24,550 ​ 4.0 % Crafts and Novelties ​ 20,519 ​ 3.3 % Discount Stores ​ 15,808 ​ 2.5 % Warehouse Clubs ​ 15,742 ​ 2.5 % Health Services ​ 15,297 ​ 2.5 % Equipment Rental ​ ​ 14,943 ​ 2.4 % Dealerships ​ ​ 13,346 ​ 2.1 % Restaurants - Quick Service ​ ​ 11,581 ​ 1.9 % Health and Fitness ​ ​ 11,276 ​ 1.8 % Sporting Goods ​ ​ 7,345 ​ 1.2 % Financial Services ​ ​ 7,187 ​ 1.2 % Specialty Retail ​ ​ 6,919 ​ 1.1 % Restaurants - Casual Dining ​ ​ 5,704 ​ 0.9 % Theaters ​ ​ 3,854 ​ 0.6 % Shoes ​ ​ 3,803 ​ 0.6 % Pet Supplies ​ ​ 3,783 ​ 0.6 % Home Furnishings ​ ​ 3,672 ​ 0.6 % Beauty and Cosmetics ​ ​ 3,493 ​ 0.6 % Entertainment Retail ​ ​ 2,323 ​ 0.4 % Apparel ​ ​ 2,016 ​ 0.3 % Miscellaneous ​ ​ 1,259 ​ 0.2 % Office Supplies ​ 624 ​ 0.1 % Total ​ $ 620,721 100.0 % (1) Represents annualized base rent on a straight-line basis as of December 31, 2024. ​ 27 Table of Contents Geographic Diversification The following table presents annualized base rents, by state, for our portfolio as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ($ in thousands) ​ ​ ​ ​ ​ Annualized ​ % of Ann.
A significant majority of the Company’s properties are leased to national tenants and approximately 69.1% of our annualized base rent was derived from tenants, or parent entities thereof, with an investment grade credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or National Association of Insurance Commissioners. Substantially all of our tenants are subject to net lease agreements.
A significant majority of the Company’s properties are leased to national tenants and approximately 68.2% of our annualized base rent was derived from tenants, or parent entities thereof, with an investment grade credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or National Association of Insurance Commissioners. Substantially all of our tenants are subject to net lease agreements.
(2) Includes tenants generating less than 1.5% of annualized contractual base rent. 25 Table of Contents Tenant Sector Diversification The following table presents annualized base rents for all sectors as of December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ($ in thousands) ​ ​ ​ ​ Annualized ​ % of Ann.
(2) Includes tenants generating less than 1.5% of annualized contractual base rent. 26 Table of Contents Tenant Sector Diversification The following table presents annualized base rents for all sectors as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ($ in thousands) ​ ​ ​ ​ Annualized ​ % of Ann.
Item 2: Properties As of December 31, 2023, the Company’s portfolio consisted of 2,135 properties located in 49 states and totaling approximately 44.2 million square feet of GLA. As of December 31, 2023, the Company’s portfolio was approximately 99.8% leased and had a weighted average remaining lease term of approximately 8.4 years.
Item 2: Properties As of December 31, 2024, the Company’s portfolio consisted of 2,370 properties located in all 50 states and totaling approximately 48.8 million square feet of GLA. As of December 31, 2024, the Company’s portfolio was approximately 99.6% leased and had a weighted average remaining lease term of approximately 7.9 years.
Developments During the year ended December 31, 2023, the Company had 37 development or Developer Funding Platform projects completed or under construction, for which 16 remained under construction as of December 31, 2023. Anticipated total costs for the 16 projects are approximately $63.7 million. ​ ​
Developments During the year ended December 31, 2024, the Company had 41 development or DFP projects completed or under construction, for which 20 remained under construction as of December 31, 2024. Anticipated total costs for the 20 projects are approximately $107.3 million. ​ ​
In addition, our tenants are typically subject to future rent increases based on fixed amounts or increases in the consumer price index and certain leases provide for additional rent calculated as a percentage of the tenants’ gross sales above a specified level. 24 Table of Contents Tenant Diversification The following table presents annualized base rents for all tenants that generated 1.5% or greater of our total annualized base rent as of December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ($ in thousands) ​ ​ ​ ​ Annualized ​ % of Ann.
In addition, our tenants are typically subject to future rent increases based on fixed amounts or increases in the consumer price index and certain leases provide for additional rent calculated as a percentage of the tenants’ gross sales above a specified level.
Tenant / Concept Base Rent (1) Base Rent Walmart ​ $ 33,864 6.1 % Tractor Supply ​ 28,155 5.1 % Dollar General ​ 26,831 4.8 % Best Buy ​ 19,515 3.5 % CVS ​ 17,310 3.1 % TJX Companies ​ 17,008 3.1 % Dollar Tree ​ 16,987 3.1 % Kroger ​ 16,315 2.9 % O'Reilly Auto Parts ​ 16,107 2.9 % Hobby Lobby ​ 14,637 2.6 % Lowe's ​ 14,025 2.5 % Burlington ​ 13,770 2.5 % 7-Eleven ​ 12,431 2.2 % Sunbelt Rentals ​ ​ 12,374 2.2 % Gerber Collision ​ ​ 11,880 2.1 % Sherwin-Williams ​ ​ 11,423 2.1 % Wawa ​ 10,185 1.8 % Home Depot ​ 8,880 1.6 % BJ's Wholesale Club ​ 8,713 1.6 % Other(2) ​ 245,955 44.2 % Total ​ $ 556,365 100.0 % (1) Represents annualized contractual base rent on a straight-line basis as of December 31, 2023.
Tenant / Concept Base Rent (1) Base Rent Walmart ​ $ 38,460 6.2 % Tractor Supply ​ 30,800 5.0 % Dollar General ​ 28,115 4.5 % Best Buy ​ 21,130 3.4 % TJX Companies ​ 19,614 3.2 % CVS ​ 19,599 3.2 % Hobby Lobby ​ 18,200 2.9 % Dollar Tree ​ 18,170 2.9 % Lowe's ​ 17,884 2.9 % O'Reilly Auto Parts ​ 17,798 2.9 % Kroger ​ 17,102 2.8 % Gerber Collision ​ 15,039 2.4 % 7-Eleven ​ 14,164 2.3 % Burlington ​ ​ 14,019 2.3 % Sunbelt Rentals ​ ​ 13,887 2.2 % Sherwin-Williams ​ ​ 11,809 1.9 % Home Depot ​ 10,680 1.7 % Wawa ​ 9,916 1.6 % Other(2) ​ 284,335 45.7 % Total ​ $ 620,721 100.0 % (1) Represents annualized base rent on a straight-line basis as of December 31, 2024.
(2) Includes states generating less than 1.5% of annualized contractual base rent. 27 Table of Contents ​ Lease Expirations The following table presents contractual lease expirations within the Company’s portfolio as of December 31, 2023, assuming that no tenants exercise renewal options: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ($ and GLA in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Annualized Base Rent (1) ​ Gross Leasable Area ​ ​ Number of ​ ​ ​ ​ % of ​ ​ ​ % of Year Leases Dollars Total Square Feet Total 2024 28 ​ $ 6,106 1.1 % 722 1.6 % 2025 73 ​ 17,153 3.1 % 1,684 3.8 % 2026 120 ​ 26,874 4.8 % 2,769 6.3 % 2027 155 ​ 34,038 6.1 % 3,119 7.1 % 2028 175 ​ 45,925 8.3 % 4,155 9.5 % 2029 182 ​ 55,189 9.9 % 5,379 12.2 % 2030 265 ​ 55,218 9.9 % 4,240 9.7 % 2031 180 ​ 42,434 7.6 % 3,119 7.1 % 2032 232 ​ 48,165 8.7 % 3,559 8.1 % 2033 193 ​ 45,005 8.1 % 3,485 7.9 % Thereafter 706 ​ 180,258 32.4 % 11,691 26.7 % Total 2,309 ​ $ 556,365 100.0 % 43,922 100.0 % (1) Represents annualized contractual base rent on a straight-line basis as of December 31, 2023.
(2) Includes states generating less than 1.5% of annualized contractual base rent. 28 Table of Contents Lease Expirations The following table presents contractual lease expirations within the Company’s portfolio as of December 31, 2024, assuming that no tenants exercise renewal options: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ($ and GLA in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Annualized Base Rent (1) ​ Gross Leasable Area ​ ​ Number of ​ ​ ​ ​ % of ​ ​ ​ % of Year Leases Dollars Total Square Feet Total 2025 41 ​ $ 7,660 1.2 % 820 1.7 % 2026 122 ​ 26,117 4.2 % 2,648 5.5 % 2027 166 ​ 37,851 6.1 % 3,538 7.3 % 2028 175 ​ 45,848 7.4 % 4,085 8.4 % 2029 207 ​ 64,977 10.5 % 6,270 12.9 % 2030 297 ​ 63,787 10.3 % 5,070 10.4 % 2031 190 ​ 44,758 7.2 % 3,286 6.8 % 2032 243 ​ 50,903 8.2 % 3,742 7.7 % 2033 212 ​ 48,454 7.8 % 3,825 7.9 % 2034 201 ​ 45,363 7.3 % 2,930 6.0 % Thereafter 698 ​ 185,003 29.8 % 12,364 25.4 % Total 2,552 ​ $ 620,721 100.0 % 48,578 100.0 % (1) Represents annualized base rent on a straight-line basis as of December 31, 2024.
Tenant Sector Base Rent (1) Base Rent Texas ​ $ 40,096 7.2 % Florida ​ 33,844 6.1 % Illinois ​ 30,816 5.5 % North Carolina ​ 30,778 5.5 % Ohio ​ 29,341 5.3 % Michigan ​ 27,810 5.0 % Pennsylvania ​ 26,126 4.7 % New Jersey ​ ​ 23,122 ​ 4.2 % California ​ ​ 22,191 ​ 4.0 % New York ​ ​ 21,193 ​ 3.8 % Georgia ​ ​ 20,564 ​ 3.7 % Wisconsin ​ ​ 15,719 ​ 2.8 % Virginia ​ ​ 15,270 ​ 2.7 % Missouri ​ ​ 14,908 ​ 2.7 % Louisiana ​ ​ 14,033 ​ 2.5 % Kansas ​ ​ 13,661 2.5 % Connecticut ​ ​ 12,762 2.3 % South Carolina ​ ​ 12,443 2.2 % Mississippi ​ ​ 12,379 2.2 % Minnesota ​ ​ 11,596 2.1 % Massachusetts ​ ​ 11,274 2.0 % Tennessee ​ ​ 10,308 1.9 % Oklahoma ​ ​ 9,419 1.7 % Alabama ​ 9,308 1.7 % Kentucky ​ 8,448 1.5 % Indiana ​ 8,437 1.5 % Maryland ​ 8,367 1.5 % Other(2) ​ ​ 62,152 ​ 11.2 % Total ​ $ 556,365 100.0 % (1) Represents annualized contractual base rent on a straight-line basis as of December 31, 2023.
Tenant Sector Base Rent (1) Base Rent Texas ​ $ 42,218 6.8 % Illinois ​ 34,178 5.5 % Michigan ​ 33,967 5.5 % North Carolina ​ 32,412 5.2 % Florida ​ 32,410 5.2 % Ohio ​ 32,390 5.2 % Pennsylvania ​ 28,539 4.6 % New York ​ ​ 28,134 ​ 4.5 % California ​ ​ 25,454 ​ 4.1 % Georgia ​ ​ 24,876 ​ 4.0 % New Jersey ​ ​ 23,877 ​ 3.8 % Wisconsin ​ ​ 18,122 ​ 2.9 % Missouri ​ ​ 17,365 ​ 2.8 % Mississippi ​ ​ 15,626 ​ 2.5 % South Carolina ​ ​ 15,597 ​ 2.5 % Virginia ​ ​ 15,463 2.5 % Louisiana ​ ​ 15,221 2.5 % Kansas ​ ​ 13,694 2.2 % Minnesota ​ ​ 13,620 2.2 % Connecticut ​ ​ 13,211 2.1 % Tennessee ​ ​ 12,098 1.9 % Massachusetts ​ ​ 11,654 1.9 % Indiana ​ ​ 11,543 1.9 % Alabama ​ 11,091 1.8 % Oklahoma ​ 9,452 1.5 % Other(2) ​ ​ 88,509 ​ 14.4 % Total ​ $ 620,721 100.0 % (1) Represents annualized base rent on a straight-line basis as of December 31, 2024.
Added
Tenant Diversification The following table presents annualized base rents for all tenants that generated 1.5% or greater of our total annualized base rent as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ($ in thousands) ​ ​ ​ ​ Annualized ​ % of Ann.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchases of Equity Securities by the Issuer Common stock repurchases during the three months ended December 31, 2023 were: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of ​ Maximum Number ​ ​ ​ ​ Shares Purchased of Shares that May ​ ​ ​ ​ ​ ​ ​ as Part of Publicly ​ Yet Be Purchased ​ ​ Total Number of ​ ​ Average Price Paid ​ Announced Plans ​ Under the Plans Period ​ Shares Purchased ​ ​ Per Share ​ or Programs ​ or Programs October 1, 2023 - October 31, 2023 ​ — ​ $ - ​ — ​ — November 1, 2023 - November 30, 2023 ​ 106 ​ ​ 56.96 ​ — ​ — December 1, 2023 - December 31, 2023 ​ 5 ​ ​ 60.98 ​ — ​ — Total ​ 111 ​ $ 57.15 ​ — ​ — ​ During the three months ended December 31, 2023, the Company withheld 111 shares from employees to satisfy estimated statutory income tax obligations related to vesting of restricted stock awards.
Biggest changeIssuer Purchases of Equity Securities Common stock repurchases during the three months ended December 31, 2024 were: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of ​ Maximum Number ​ ​ ​ ​ Shares Purchased of Shares that May ​ ​ ​ ​ ​ ​ ​ as Part of Publicly ​ Yet Be Purchased ​ ​ Total Number of ​ ​ Average Price Paid ​ Announced Plans ​ Under the Plans Period ​ Shares Purchased ​ ​ Per Share ​ or Programs ​ or Programs October 1, 2024 - October 31, 2024 ​ — ​ $ — ​ — ​ — November 1, 2024 - November 30, 2024 ​ 192 ​ ​ 76.67 ​ — ​ — December 1, 2024 - December 31, 2024 ​ 50 ​ ​ 70.98 ​ — ​ — Total ​ 242 ​ $ 75.50 ​ — ​ — During the three months ended December 31, 2024, the Company withheld 242 shares from employees to satisfy estimated statutory income tax obligations related to vesting of restricted stock awards.
The value of the common stock withheld was based on the closing price of our common stock on the applicable vesting date. Recent Sales of Unregistered Securities There were no unregistered sales of equity securities during the year ended December 31, 2023.
The value of the common stock withheld was based on the closing price of our common stock on the applicable vesting date. Recent Sales of Unregistered Securities There were no unregistered sales of equity securities during the year ended December 31, 2024.
The Operating Partnership Common Units are exchangeable into shares 28 Table of Contents of common stock on a one-for-one basis. The Company intends to continue to declare regular dividends.
The Operating Partnership Common Units are exchangeable into shares of common stock on a one-for-one basis. 29 Table of Contents The Company intends to continue to declare regular dividends.
The number of stockholders of record does not reflect persons or entities that held their shares in nominee or “street” name. In addition, at February 12, 2024 there were 347,619 outstanding Operating Partnership Common Units held by a limited partner other than our Company.
The number of stockholders of record does not reflect persons or entities that held their shares in nominee or “street” name. In addition, at February 10, 2025 there were 347,619 outstanding Operating Partnership Common Units held by a limited partner other than our Company.
Item 5: Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Dividend Policy The Company’s common stock is traded on the NYSE under the symbol “ADC.” At February 12, 2024, there were 100,519,355 shares of our common stock issued and outstanding which were held by approximately 159 stockholders of record.
Item 5: Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Dividend Policy The Company’s common stock is traded on the NYSE under the symbol “ADC.” At February 10, 2025, there were 107,248,705 shares of our common stock issued and outstanding which were held by approximately 160 stockholders of record.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe weighted-average capitalization rate on the dispositions was 6.1%. 1 1 When used within this discussion, “weighted average capitalization rate” for acquisitions and dispositions is defined by the Company as the sum of contractual fixed annual rents computed on a straight-line basis over the primary lease terms and anticipated annual net tenant recoveries, divided by the purchase and sale prices for occupied properties. 30 Table of Contents Development and Developer Funding Platform During the year ended December 31, 2023, the Company commenced 13 development and Developer Funding Platform projects.
Biggest changeAt December 31, 2024, the Company had 20 development or DFP projects under construction. 1 When used within this discussion, “weighted average capitalization rate” for acquisitions and dispositions is defined by the Company as the sum of contractual fixed annual rents computed on a straight-line basis over the primary lease terms and anticipated annual net tenant recoveries, divided by the purchase and sale prices for occupied properties. 31 Table of Contents Comparison of Year Ended December 31, 2024 to Year Ended December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ Variance ​ December 31, 2024 December 31, 2023 (in dollars) (percentage) Rental Income ​ $ 616,822 ​ $ 537,403 ​ $ 79,419 ​ 15 % Real Estate Tax Expense ​ $ 46,882 ​ $ 40,092 ​ $ 6,790 ​ 17 % Property Operating Expense ​ $ 26,349 ​ $ 24,961 ​ $ 1,388 ​ 6 % Depreciation and Amortization Expense ​ $ 206,987 ​ $ 176,277 ​ $ 30,710 ​ 17 % ​ The variances in rental income, real estate tax expense, property operating expense and depreciation and amortization expense shown above were due to the acquisition and the ownership of an increased number of properties during the year ended December 31, 2024 compared to the year ended December 31, 2023 , as further described under Results of Operations - Overall above .
These guarantees are senior 35 Table of Contents unsecured obligations of the guarantors, rank equally in right of payment with all other existing and future senior unsecured indebtedness and are effectively subordinated to all secured indebtedness of the Operating Partnership and each guarantor (to the extent of the value of the collateral securing such indebtedness) of the guarantors. ​ The Public Notes are governed by an Indenture, dated August 17, 2020, among the Operating Partnership, the Company and respective trustee (as amended and supplemented by an officer’s certificate dated at the issuance of each of the Public Notes, the “Indenture”).
These guarantees are senior unsecured obligations of the guarantors, rank equally in right of payment with all other existing and future senior unsecured indebtedness and are effectively subordinated to all secured indebtedness of the Operating Partnership and each guarantor (to the extent of the value of the collateral securing such indebtedness). 37 Table of Contents The Public Notes are governed by an Indenture, dated August 17, 2020, among the Operating Partnership, the Company and respective trustee (as amended and supplemented by an officer’s certificate dated at the issuance of each of the Public Notes, the “Indenture”).
The Company used the existing $350 million of forward starting interest rate swaps to hedge the variable SOFR priced interest to a weighted average fixed rate of 3.57% until January 2029.
The Company used the existing $350.0 million of forward starting interest rate swaps to hedge the variable SOFR priced interest to a weighted average fixed rate of 3.57% until January 2029.
As of December 31, 2023, the most restrictive covenant was the minimum unencumbered interest expense ratio. The Company was in compliance with all of its material loan covenants and obligations as of December 31, 2023. Cash Flows Operating - Most of the Company’s cash from operations is generated by rental income from its investment portfolio.
As of December 31, 2024, the most restrictive covenant was the minimum unencumbered interest expense ratio. The Company was in compliance with all of its material loan covenants and obligations as of December 31, 2024. Cash Flows Operating - Most of the Company’s cash from operations is generated by rental income from its investment portfolio.
The Company’s real estate investments were made throughout and between the periods presented and were not all outstanding for the entire period; accordingly, a portion of the increase in rental income between periods is related to recognizing revenue in 2023 on acquisitions that were made during 2022.
The Company’s real estate investments were made throughout and between the periods presented and were not all outstanding for the entire period; accordingly, a portion of the increase in rental income between periods is related to recognizing revenue in 2024 on acquisitions that were made during 2023.
Unsecured Term Loan On July 31, 2023, the Company closed on the 2029 Unsecured Term Loan, an unsecured $350 million 5.5-year term loan which includes an accordion option that allows the Company to request additional lender commitments up to a total of $500 million and matures in January 2029.
Unsecured Term Loan In July 2023, the Company closed on the 2029 Unsecured Term Loan, an unsecured $350.0 million 5.5-year term loan which includes an accordion option that allows the Company to request additional lender commitments up to a total of $500.0 million and matures in January 2029.
The Company’s assets are held by, and all of its operations are conducted through, directly or indirectly, the Operating Partnership, of which the Company is the sole general partner and in which the Company held a 99.7% common interest as of December 31, 2023.
The Company’s assets are held by, and all of its operations are conducted through, directly or indirectly, the Operating Partnership, of which the Company is the sole general partner and in which the Company held a 99.7% common interest as of December 31, 2024.
Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the consolidated financial statements, and related notes thereto, included elsewhere in this Annual Report on Form 10-K and the “Cautionary Note Regarding Forward-Looking 29 Table of Contents Statements” in “Item 1A – Risk Factors” above.
Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with the consolidated financial statements, and related notes thereto, included elsewhere in this Annual Report on Form 10-K and the “Cautionary Note Regarding Forward-Looking Statements” in “Item 1A – Risk Factors” above.
(2) Estimated interest payments calculated for (i) variable rate debt based on the rate in effect at period-end and (ii) fixed rate debt based on the coupon interest rate. In addition to items reflected in the table above, the Company has preferred stock with cumulative cash dividends, as described under Equity – Preferred Stock Offering above.
(2) Estimated interest payments calculated for (i) variable rate debt based on the rate in effect at period-end and (ii) fixed rate debt based on the coupon interest rate. 39 Table of Contents In addition to items reflected in the table above, the Company has preferred stock with cumulative cash dividends, as described under Equity – Preferred Stock Offering above.
A significant majority of the Company’s properties are leased to national tenants and approximately 69.1% of our annualized base rent was derived from tenants, or parent entities thereof, with an investment grade credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners.
A significant majority of the Company’s properties are leased to national tenants and approximately 68.2% of our annualized base rent was derived from tenants, or parent entities thereof, with an investment grade credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners.
Management considers AFFO a useful supplemental measure of the Company’s performance, however, 39 Table of Contents AFFO should not be considered an alternative to net income as an indication of its performance, or to cash flow as a measure of liquidity or ability to make distributions.
Management considers AFFO a useful supplemental measure of the Company’s performance, however, AFFO should not be considered an alternative to net income as an indication of its performance, or to cash flow as a measure of liquidity or ability to make distributions.
The Company settled all of the May 2022 forward sales agreements in 2022 which resulted in net proceeds to the Company of approximately $386.7 million, after deducting fees and expenses and making certain other adjustments.
The Company settled all of the May 2022 forward sales agreements in 2022 which resulted in net proceeds to the Company of 33 Table of Contents approximately $386.7 million, after deducting fees and expenses and making certain other adjustments.
Our ability to access capital on favorable terms as well as to use cash from operations to continue to meet our liquidity needs, is uncertain and cannot be predicted and could be affected by various risks and uncertainties, including, but not limited to the risks detailed in Part I, Item 1A, “Risk Factors.” Capitalization As of December 31, 2023, the Company’s total enterprise value was approximately $8.94 billion.
Our ability to access capital on favorable terms as well as to use cash from operations to continue to meet our liquidity needs, is uncertain and cannot be predicted and could be affected by various risks and uncertainties, including, but not limited to the risks detailed in Part I, Item 1A, “Risk Factors.” Capitalization As of December 31, 2024, the Company’s total enterprise value was approximately $10.56 billion.
The increase was primarily the result of increased compensation costs due to inflationary increases and higher stock based compensation expense as a result of changing the vesting period for awards granted in 2023.
The increase was primarily the result of growth in compensation costs due to inflationary increases and higher stock based compensation expense as a result of changing the vesting period for awards granted in 2023 and 2024.
Common Stock Offerings In December 2021, the Company completed a follow-on public offering of 5,750,000 shares of common stock, including the full exercise of the underwriters' option to purchase an additional 750,000 shares, in connection with forward sale agreements. During 2022, the Company settled all of the December 2021 forward sale agreements.
Common Stock Offerings In December 2021, the Company completed a follow-on public offering of 5,750,000 shares of common stock, including the full exercise of the underwriters' option to purchase an additional 750,000 shares, in connection with forward sale agreements.
The December dividend was recorded as a liability on the Consolidated Balance Sheet at December 31, 2023 and were paid on January 2, 2024. ​ Recent Accounting Pronouncements Refer to Note 2 – Summary of Significant Accounting Policies in the consolidated financial statements for a summary and anticipated impact of each accounting pronouncement on the Company’s financial statements.
The December dividend was recorded as a liability on the consolidated balance sheets at December 31, 2024 and was paid on January 2, 2025. ​ Recent Accounting Pronouncements Refer to Note 2 – Summary of Significant Accounting Policies in the consolidated financial statements for a summary and anticipated impact of each accounting pronouncement on the Company’s financial statements.
The Company’s total debt to total enterprise value was 27.2% at December 31, 2023. At December 31, 2023, the non-controlling interest in the Operating Partnership consisted of a 0.3% common ownership interest in the Operating Partnership. The Operating Partnership Common Units may, under certain circumstances, be exchanged for shares of Company common stock on a one-for-one basis.
The Company’s total debt to total enterprise value was 26.6% at December 31, 2024. At December 31, 2024, the non-controlling interest in the Operating Partnership consisted of a 0.3% common ownership interest in the Operating Partnership. The Operating Partnership Common Units may, under certain circumstances, be exchanged for shares of Company common stock on a one-for-one basis.
During 2023, the Company settled the remaining 4,150,000 shares of these October 2022 forward sale agreements, realizing net proceeds of $275.0 million. The offering resulted in total net proceeds to the Company of $381.2 million after deducting fees and expenses and making certain adjustments.
During the year ended December 31, 2023, the Company settled the remaining 4,150,000 shares of these October 2022 forward sale agreements, realizing net proceeds of $275.0 million. The offering resulted in total net proceeds to the Company of $381.2 million after deducting fees and expenses and making certain adjustments as provided in the forward sale agreements.
In October 2022, the Company completed a follow-on public offering of 5,750,000 shares of common stock, including the full exercise of the underwriters' option to purchase 750,000 shares, in connection with forward sale agreements. During 2022, the Company settled 1,600,000 shares of common stock under the forward sale agreements, realizing net proceeds of $106.2 million.
In October 2022, the Company completed a follow-on public offering of 5,750,000 shares of common stock, including the full exercise of the underwriters' option to purchase an additional 750,000 shares, in connection with forward sale agreements. As of December 31, 2022, the Company settled 1,600,000 shares of these October 2022 forward sale agreements, realizing net proceeds of $106.2 million.
Events or circumstances that may occur include, but are not limited to, significant changes in real estate market conditions, estimated residual values, our ability or expectation to re-lease properties that are vacant or become vacant or a change in the anticipated holding period for a property.
Events or circumstances that may occur include, but are not limited to, significant changes in real estate market conditions, estimated residual values, our ability or expectation to re-lease properties that are vacant or become vacant or a change in the anticipated holding period for a property. Identification of such events may involve certain assumptions, estimates, and significant judgment.
Total enterprise value consisted of $6.35 billion of common equity (based on the December 31, 2023 closing price of Company common stock on the NYSE of $62.95 per common share and assuming the conversion of Operating Partnership Common Units), $175.0 million of preferred equity (stated at liquidation value), and $2.43 billion of total debt including (i) $227.0 million of borrowings under its revolving credit facility; (ii) $1.81 billion of senior unsecured notes; (iii) $350.0 million of unsecured term loans (iv) $44.9 million of mortgage notes payable; less $14.5 million cash, cash equivalents and cash held in escrow.
Total enterprise value consisted of $7.58 billion of common equity (based on the December 31, 2024 closing price of Company common stock on the NYSE of $70.45 per share and assuming the conversion of Operating Partnership Common Units), $175.0 million of preferred equity (stated at liquidation value), and $2.81 billion of total debt including (i) $158.0 million of borrowings under its Revolving Credit Facility; (ii) $2.26 billion of senior unsecured notes; (iii) $350.0 million of unsecured term loans (iv) $43.9 million of mortgage notes payable; less $6.4 million cash, cash equivalents and cash held in escrow.
Similarly, the full rental income impact of acquisitions made during 2023 will not be seen until 2024. Acquisitions During the year ended December 31, 2023, the Company acquired 282 retail net lease assets for approximately $1.20 billion, which includes acquisition and closing costs.
Similarly, the full rental income impact of acquisitions made during 2024 will not be seen until 2025. Acquisitions During the year ended December 31, 2024, the Company acquired 242 retail net lease assets for approximately $874.5 million, which includes acquisition and closing costs.
These construction commitments will be funded using cash provided from operations, current capital resources on hand, and/or other sources of funding available to the Company. ​ The Company’s recurring obligations under its tenant leases for maintenance, taxes, and/or insurance will also be funded through the sources available to the Company described earlier. ​ 37 Table of Contents Dividends During the fourth quarter of 2023 the Company declared monthly dividends of $0.247 per common share for October, November, and December 2023.
These construction commitments will be funded using cash provided from operations, current capital resources on hand, and/or other sources of funding available to the Company. ​ The Company’s recurring obligations under its tenant leases for maintenance, taxes, and/or insurance will also be funded through the sources available to the Company described earlier. ​ Dividends During 2024, the Company declared monthly dividends totaling $3.000 per common share.
After allocation of income to non-controlling interest and preferred stockholders, net income attributable to common stockholders increased $17.5 million, or 12% to $162.5 million for the year ended December 31, 2023, compared to $145.0 million for the year ended December 31, 2022.
After allocation of income to non-controlling interest and preferred stockholders, net income attributable to common stockholders increased $19.3 million, or 12% to $181.8 million for the year ended December 31, 2024, compared to $162.5 million for the year ended December 31, 2023.
This conversion value is limited by a share cap if the Company’s stock price falls below a certain threshold. 33 Table of Contents ATM Programs The Company enters into ATM programs through which the Company, from time to time, sells shares of common stock and enters into forward sale agreements.
This conversion value is limited by a share cap if the Company’s stock price falls below a certain threshold. ATM Programs The Company enters into ATM programs through which the Company, from time to time, sells shares of common stock and/or enters into forward sale agreements. In October 2024, the Company entered into the $1.25 billion October 2024 ATM Program.
These properties are located in 40 states and are leased to tenants operating in 26 diverse retail sectors for a weighted average lease term of approximately 11.3 years.
These properties are located in 44 states and are leased to tenants operating in 27 diverse retail sectors for a weighted average lease term of approximately 10.4 years.
General and administrative expenses increased $4.7 million, or 15%, to $34.8 million for the year ended December 31, 2023, compared to $30.1 million for the year ended December 31, 2022.
General and administrative expenses increased $2.4 million, or 7%, to $37.2 million for the year ended December 31, 2024, compared to $34.8 million for the year ended December 31, 2023.
General and administrative expenses as a percentage of total revenue decreased to 6.5% for the year ended December 31, 2023 from 7.0% for the year ended December 31, 2022. Interest expense increased $17.7 million, or 28%, to $81.1 million for the year ended December 31, 2023, compared to $63.4 million for the year ended December 31, 2022.
General and administrative expenses as a percentage of total revenue decreased to 6.0% for the year ended December 31, 2024 from 6.5% for the year ended December 31, 2023. Interest expense increased $27.8 million, or 34%, to $108.9 million for the year ended December 31, 2024, compared to $81.1 million for the year ended December 31, 2023.
As of December 31, 2023, the Company’s portfolio consisted of 2,135 properties located in 49 states and totaling approximately 44.2 million square feet of GLA. The portfolio was approximately 99.8% leased and had a weighted average remaining lease term of approximately 8.4 years.
As of December 31, 2024, the Company’s portfolio consisted of 2,370 properties located in all 50 states and totaling approximately 48.8 million square feet of GLA. The portfolio was approximately 99.6% leased and had a weighted average remaining lease term of approximately 7.9 years.
Identification of such events may involve certain assumptions, estimates, and significant judgment. 38 Table of Contents Management determines whether an impairment in value has occurred by comparing the estimated future cash flows (undiscounted and without interest charges), including the residual value of the real estate, to the carrying cost of the individual asset.
Management determines whether an impairment in value has occurred by comparing the estimated future cash flows (undiscounted and without interest charges), including the residual value of the real estate, to the carrying cost of the individual asset.
Results of Operations Overall The Company’s real estate investment portfolio grew from approximately $5.74 billion in net investment amount representing 1,839 properties with 38.1 million square feet of gross leasable space as of December 31, 2022 to approximately $6.74 billion in net investment amount representing 2,135 properties with 44.2 million square feet of gross leasable space at December 31, 2023.
Results of Operations Overall The Company’s real estate investment portfolio grew from approximately $6.74 billion in net investment amount representing 2,135 properties with 44.2 million square feet of GLA as of December 31, 2023 to approximately $7.42 billion in net investment amount representing 2,370 properties with 48.8 million square feet of GLA at December 31, 2024.
The Revolving Credit Facility includes an accordion option that allows the Company to request additional lender commitments up to a total of $1.75 billion. The Revolving Credit Facility will mature in January 2026 with Company options to extend the maturity date to January 2027.
The Revolving Credit Facility includes an accordion option that allows the Company to request additional lender commitments up to a total of $2.00 billion. The Revolving Credit Facility will mature in August 2028 with Company 36 Table of Contents options to extend the maturity date to August 2029.
Assuming the exchange of all Operating Partnership Common Units, there would have been 100,866,974 shares of common stock outstanding at December 31, 2023. 32 Table of Contents Equity Shelf Registration The Company has filed with the SEC an automatic shelf registration statement on Form S-3ASR, registering an unspecified amount of common stock, preferred stock, depositary shares, warrants of the Company and guarantees of debt securities of the Operating Partnership, as well as an unspecified amount of debt securities of the Operating Partnership, at an indeterminate aggregate initial offering price.
Equity Shelf Registration The Company has filed with the SEC an automatic shelf registration statement on Form S-3ASR, registering an unspecified amount of common stock, preferred stock, depositary shares, warrants of the Company and guarantees of debt securities of the Operating Partnership, as well as an unspecified amount of debt securities of the Operating Partnership, at an indeterminate aggregate initial offering price.
The following table provides a reconciliation of net income to FFO, Core FFO, and AFFO for the years ended December 31, 2023, 2022 and 2021 ( presented in thousands ): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, 2023 December 31, 2022 December 31, 2021 Reconciliation from Net Income to Funds from Operations ​ ​ ​ ​ ​ ​ ​ ​ Net income ​ ​ ​ $ 170,547 ​ $ 153,035 ​ $ 122,876 Less Series A preferred stock dividends ​ ​ ​ ​ 7,437 ​ ​ 7,437 ​ ​ 2,148 Net income attributable to Operating Partnership common unitholders ​ ​ ​ ​ 163,110 ​ ​ 145,598 ​ ​ 120,728 Depreciation of rental real estate assets ​ ​ ​ 115,617 ​ 88,685 ​ 66,732 Amortization of lease intangibles - in-place leases and leasing costs ​ ​ ​ 58,967 ​ 44,107 ​ 28,379 Provision for impairment ​ ​ ​ 7,175 ​ 1,015 ​ 1,919 (Gain) loss on sale or involuntary conversion of assets, net ​ ​ ​ (1,849) ​ (5,258) ​ (15,111) Funds from Operations - Operating Partnership common unitholders ​ ​ ​ $ 343,020 ​ $ 274,147 ​ $ 202,647 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loss on extinguishment of debt and settlement of related hedges ​ ​ ​ ​ — ​ ​ — ​ ​ 14,614 Amortization of above (below) market lease intangibles, net and assumed mortgage debt discount, net ​ ​ ​ ​ 33,430 ​ ​ 33,563 ​ ​ 24,284 Core Funds from Operations - Operating Partnership common unitholders ​ ​ ​ $ 376,450 ​ $ 307,710 ​ $ 241,545 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Straight-line accrued rent ​ ​ ​ (12,142) ​ (13,176) ​ (11,857) Stock-based compensation expense ​ ​ ​ 8,338 ​ 6,464 ​ 5,467 Amortization of financing costs and original issue discounts ​ ​ ​ 4,403 ​ 3,141 ​ 1,197 Non-real estate depreciation ​ ​ ​ 1,693 ​ 778 ​ 618 Adjusted Funds from Operations - Operating Partnership common unitholders ​ ​ ​ $ 378,742 ​ $ 304,917 ​ $ 236,970 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Funds from Operations per common share and partnership unit - diluted ​ ​ ​ $ 3.58 ​ $ 3.45 ​ $ 3.00 Core Funds from Operations per common share and partnership unit - diluted ​ ​ ​ $ 3.93 ​ $ 3.87 ​ $ 3.58 Adjusted Funds from Operations per common share and partnership unit - diluted ​ ​ ​ $ 3.95 ​ $ 3.83 ​ $ 3.51 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average shares and Operating Partnership common units outstanding ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ ​ ​ 95,539,028 ​ 79,006,952 ​ 67,149,861 Diluted ​ ​ ​ 95,785,031 ​ 79,512,005 ​ 67,486,698 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional supplemental disclosure ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Scheduled principal repayments ​ ​ ​ $ 905 ​ $ 850 ​ $ 799 Capitalized interest ​ ​ ​ $ 1,957 ​ $ 1,261 ​ $ 249 Capitalized building improvements ​ ​ ​ $ 9,819 ​ $ 7,945 ​ $ 5,821 ​ ​ 40 Table of Contents ​
The Company’s computation of AFFO may differ from the methodology for calculating AFFO used by other equity REITs, and therefore may not be comparable to such other REITs. 42 Table of Contents The following table provides a reconciliation of net income to FFO, Core FFO, and AFFO for the years ended December 31, 2024, 2023 and 2022 ( presented in thousands ): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, 2024 December 31, 2023 December 31, 2022 Reconciliation from Net Income to Funds from Operations ​ ​ ​ ​ ​ ​ ​ ​ Net income ​ ​ ​ $ 189,832 ​ $ 170,547 ​ $ 153,035 Less Series A preferred stock dividends ​ ​ ​ ​ 7,437 ​ ​ 7,437 ​ ​ 7,437 Net income attributable to Operating Partnership common unitholders ​ ​ ​ ​ 182,395 ​ ​ 163,110 ​ ​ 145,598 Depreciation of rental real estate assets ​ ​ ​ 137,835 ​ 115,617 ​ 88,685 Amortization of lease intangibles - in-place leases and leasing costs ​ ​ ​ 67,128 ​ 58,967 ​ 44,107 Provision for impairment ​ ​ ​ 7,224 ​ 7,175 ​ 1,015 (Gain) loss on sale or involuntary conversion of assets, net ​ ​ ​ (11,441) ​ (1,849) ​ (5,258) Funds from Operations - Operating Partnership common unitholders ​ ​ ​ $ 383,141 ​ $ 343,020 ​ $ 274,147 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of above (below) market lease intangibles, net and assumed mortgage debt discount, net ​ ​ ​ ​ 33,571 ​ ​ 33,430 ​ ​ 33,563 Core Funds from Operations - Operating Partnership common unitholders ​ ​ ​ $ 416,712 ​ $ 376,450 ​ $ 307,710 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Straight-line accrued rent ​ ​ ​ (12,711) ​ (12,142) ​ (13,176) Stock-based compensation expense ​ ​ ​ 10,805 ​ 8,338 ​ 6,464 Amortization of financing costs and original issue discounts ​ ​ ​ 5,988 ​ 4,403 ​ 3,141 Non-real estate depreciation ​ ​ ​ 2,024 ​ 1,693 ​ 778 Adjusted Funds from Operations - Operating Partnership common unitholders ​ ​ ​ $ 422,818 ​ $ 378,742 ​ $ 304,917 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Funds from Operations per common share and partnership unit - diluted ​ ​ ​ $ 3.75 ​ $ 3.58 ​ $ 3.45 Core Funds from Operations per common share and partnership unit - diluted ​ ​ ​ $ 4.08 ​ $ 3.93 ​ $ 3.87 Adjusted Funds from Operations per common share and partnership unit - diluted ​ ​ ​ $ 4.14 ​ $ 3.95 ​ $ 3.83 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average shares and Operating Partnership common units outstanding ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ ​ ​ 101,446,871 ​ 95,539,028 ​ 79,006,952 Diluted ​ ​ ​ 102,223,923 ​ 95,785,031 ​ 79,512,005 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional supplemental disclosure ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Scheduled principal repayments ​ ​ ​ $ 963 ​ $ 905 ​ $ 850 Capitalized interest ​ ​ ​ $ 1,599 ​ $ 1,957 ​ $ 1,261 Capitalized building improvements ​ ​ ​ $ 12,905 ​ $ 9,819 ​ $ 7,945 ​ ​
Investing - Net cash used in investing activities was $341.0 million lower during the year ended December 31, 2023, compared to 2022 primarily due to: ● Cash used for property acquisitions decreased $372.5 million due to the overall decrease in the level of acquisition activity; and ● Proceeds from asset sales decreased by $31.1 million.
Investing - Net cash used in investing activities was $389.6 million lower during the year ended December 31, 2024, compared to the year ended December 31, 2023 primarily due to: ● $328.8 million decrease in cash used for property acquisitions as a result of the overall decrease in the level of acquisition activity; ● $80.5 million increase in proceeds from asset sales.
The offering resulted in net proceeds to the Company of approximately $368.7 million after deducting fees and expenses and making certain other adjustments. In May 2022, the Company completed a follow-on public offering of 5,750,000 shares of common stock, including the full exercise of the underwriters’ option to purchase 750,000 shares in connection with forward sale agreements.
In May 2022, the Company completed a follow-on public offering of 5,750,000 shares of common stock, including the full exercise of the underwriters’ option to purchase 750,000 shares in connection with forward sale agreements.
The use of different assumptions in the allocation of the purchase price of the acquired properties could affect the timing of recognition of the related revenue and expenses. Impairments We review our real estate investments for possible impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable through operations plus estimated disposition proceeds.
Impairments We review our real estate investments for possible impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable through operations plus estimated disposition proceeds.
During the year ended December 31, 2023 the Company had 37 development or Developer Funding Platform projects completed or under construction, for which 16 remain under construction as of December 31, 2023. Anticipated total costs for the 16 projects are approximately $63.7 million.
During the year ended December 31, 2024, the Company had 41 development or DFP projects completed or under construction, for which 20 remain under construction as of December 31, 2024. Anticipated total costs for the 20 projects are approximately $107.3 million.
The Company, as sole general partner of the Operating Partnership, has the option to settle exchanged Operating Partnership Common Units held by others for cash based on the current trading price of our shares.
The Company, as sole general partner of the Operating Partnership, has the option to settle exchanged Operating Partnership Common Units held by others for cash based on the current trading price of our shares. Assuming the exchange of all Operating Partnership Common Units, there would have been 107,596,324 shares of common stock outstanding at December 31, 2024.
Provisions for impairment are recorded when events or changes in circumstances indicate that the carrying amount may not be recoverable through operations plus estimated disposition proceeds and are not necessarily comparable period-to-period. Net income increased $17.5 million, or 11%, to $170.5 million for the year ended December 31, 2023, compared to $153.0 million for the year ended December 31, 2022.
Provisions for impairment are recorded when events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable through operations plus estimated disposition proceeds and are not necessarily comparable period-to-period.
The Company expects to meet its short-term liquidity requirements through cash and cash equivalents held as of December 31, 2023, cash provided from operations, and borrowings under its revolving credit facility. As of December 31, 2023, available cash and cash equivalents, including cash held in escrow, was $14.5 million.
The Company expects to meet its short-term liquidity requirements through cash and cash equivalents held as of December 31, 2024, cash provided from operations, settlement of outstanding forward equity and borrowings under its Revolving 32 Table of Contents Credit Facility.
Also refer to “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s previously filed Annual Report on Form 10-K for the year ended December 31, 2022 for additional discussion of our financial condition and results of operations, including a comparison of our results of operations for the years ended December 31, 2022 and December 31, 2021.
Also refer to “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s previously filed Annual Report on Form 10-K for the year ended December 31, 2023 for additional discussion of our financial condition and results of operations, including a comparison of our results of operations for the years ended December 31, 2023 and December 31, 2022. 30 Table of Contents Overview The Company is a fully integrated REIT primarily focused on the ownership, acquisition, development and management of retail properties net leased to industry leading tenants.
Debt The below table summarizes the Company’s outstanding debt as of December 31, 2023 and December 31, 2022 ( presented in thousands ): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ All-in ​ ​ Coupon ​ ​ ​ ​ Principal Amount Outstanding ​ Interest Rate ​ Rate ​ ​ Maturity December 31, 2023 December 31, 2022 Senior Unsecured Revolving Credit Facility ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revolving Credit Facility (1) 6.27 % ​ ​ ​ ​ January 2026 ​ $ 227,000 ​ $ 100,000 Total Credit Facility ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 227,000 ​ $ 100,000 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unsecured Term Loan ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2029 Unsecured Term Loan (2) 4.52 % ​ ​ ​ ​ January 2029 ​ $ 350,000 ​ $ — Total Unsecured Term Loan ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 350,000 ​ $ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Senior Unsecured Notes (3) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 Senior Unsecured Notes 4.16 % ​ 4.16 % ​ May 2025 ​ $ 50,000 ​ $ 50,000 2027 Senior Unsecured Notes 4.26 % ​ 4.26 % ​ May 2027 ​ 50,000 ​ 50,000 2028 Senior Unsecured Public Notes (4) ​ 2.11 % ​ 2.00 % ​ June 2028 ​ ​ 350,000 ​ ​ 350,000 2028 Senior Unsecured Notes 4.42 % ​ 4.42 % ​ July 2028 ​ 60,000 ​ 60,000 2029 Senior Unsecured Notes 4.19 % ​ 4.19 % ​ September 2029 ​ 100,000 ​ 100,000 2030 Senior Unsecured Notes 4.32 % ​ 4.32 % ​ September 2030 ​ 125,000 ​ 125,000 2030 Senior Unsecured Public Notes (4) 3.49 % ​ 2.90 % ​ October 2030 ​ 350,000 ​ 350,000 2031 Senior Unsecured Notes 4.42 % ​ 4.47 % ​ October 2031 ​ ​ 125,000 ​ ​ 125,000 2032 Senior Unsecured Public Notes (4) ​ 3.96 % ​ 4.80 % ​ October 2032 ​ ​ 300,000 ​ ​ 300,000 2033 Senior Unsecured Public Notes (4) ​ 2.13 % ​ 2.60 % ​ June 2033 ​ ​ 300,000 ​ ​ 300,000 Total Senior Unsecured Notes ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 1,810,000 ​ $ 1,810,000 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Mortgage Notes Payable ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Single Asset Mortgage Loan 5.01 % ​ ​ ​ ​ September 2023 ​ — ​ 4,622 Portfolio Credit Tenant Lease ​ 6.27 % ​ ​ ​ ​ July 2026 ​ ​ 2,618 ​ ​ 3,523 Four Asset Mortgage Loan 3.63 % ​ ​ ​ ​ December 2029 ​ 42,250 ​ 42,250 Total Mortgage Notes Payable ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 44,868 ​ $ 50,395 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Principal Amount Outstanding ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 2,431,868 ​ $ 1,960,395 34 Table of Contents (1) The interest rate of the Revolving Credit Facility assumes SOFR as of December 31, 2023 of 5.39%.
The following table summarizes the ATM activity completed during the years ended December 31, 2024, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ 2023 ​ 2022 ​ Shares of common stock sold under the ATM programs ​ 10,598,037 ​ 5,846,998 ​ 7,678,911 ​ Shares of common stock settled under the ATM programs ​ 6,630,112 ​ 6,117,768 ​ 5,699,566 ​ Net proceeds received (in millions) ​ $403.8 ​ $415.4 ​ $397.2 ​ ​ 35 Table of Contents Debt The below table summarizes the Company’s outstanding debt as of December 31, 2024 and 2023 ( presented in thousands ): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ All-in ​ ​ Coupon ​ ​ ​ ​ Principal Amount Outstanding ​ Interest Rate ​ Rate ​ ​ Maturity December 31, 2024 December 31, 2023 Senior Unsecured Revolving Credit Facility ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revolving Credit Facility (1) 5.29 % ​ ​ ​ ​ August 2028 ​ $ 158,000 ​ $ 227,000 Total Credit Facility ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 158,000 ​ $ 227,000 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unsecured Term Loan ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2029 Unsecured Term Loan (2) 4.52 % ​ ​ ​ ​ January 2029 ​ $ 350,000 ​ $ 350,000 Total Unsecured Term Loan ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 350,000 ​ $ 350,000 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Senior Unsecured Notes (3) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 Senior Unsecured Notes 4.16 % ​ 4.16 % ​ May 2025 ​ $ 50,000 ​ $ 50,000 2027 Senior Unsecured Notes 4.26 % ​ 4.26 % ​ May 2027 ​ 50,000 ​ 50,000 2028 Senior Unsecured Public Notes (4) ​ 2.11 % ​ 2.00 % ​ June 2028 ​ ​ 350,000 ​ ​ 350,000 2028 Senior Unsecured Notes 4.42 % ​ 4.42 % ​ July 2028 ​ 60,000 ​ 60,000 2029 Senior Unsecured Notes 4.19 % ​ 4.19 % ​ September 2029 ​ 100,000 ​ 100,000 2030 Senior Unsecured Notes 4.32 % ​ 4.32 % ​ September 2030 ​ 125,000 ​ 125,000 2030 Senior Unsecured Public Notes (4) 3.49 % ​ 2.90 % ​ October 2030 ​ 350,000 ​ 350,000 2031 Senior Unsecured Notes 4.42 % ​ 4.47 % ​ October 2031 ​ ​ 125,000 ​ ​ 125,000 2032 Senior Unsecured Public Notes (4) ​ 3.96 % ​ 4.80 % ​ October 2032 ​ ​ 300,000 ​ ​ 300,000 2033 Senior Unsecured Public Notes (4) ​ 2.13 % ​ 2.60 % ​ June 2033 ​ ​ 300,000 ​ ​ 300,000 2034 Senior Unsecured Public Notes (4) ​ 5.65 % ​ 5.63 % ​ June 2034 ​ ​ 450,000 ​ ​ — Total Senior Unsecured Notes ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 2,260,000 ​ $ 1,810,000 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Mortgage Notes Payable ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Portfolio Credit Tenant Lease ​ 6.27 % ​ ​ ​ ​ July 2026 ​ ​ 1,654 ​ ​ 2,618 Four Asset Mortgage Loan 3.63 % ​ ​ ​ ​ December 2029 ​ 42,250 ​ 42,250 Total Mortgage Notes Payable ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 43,904 ​ $ 44,868 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Principal Amount Outstanding ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 2,811,904 ​ $ 2,431,868 (1) The interest rate of the Revolving Credit Facility assumes our SOFR borrowing rate as of December 31, 2024 of 4.46%.
The weighted average interest rate on the Company’s mortgage notes payable was 3.78% as of December 31, 2023. The Company has entered into mortgage loans which are secured by multiple properties and contain cross-default and cross-collateralization provisions. Cross-collateralization provisions allow a lender to foreclose on multiple properties in the event that the Company defaults under the loan.
The Company has entered into mortgage loans which are secured by multiple properties and contain cross-default and cross-collateralization provisions. Cross-collateralization provisions allow a lender to foreclose on multiple properties in the event that the Company defaults under the loan. Cross-default provisions allow a lender to foreclose on the related property in the event a default is declared under another loan.
The December dividends and distributions were recorded as a liability on the Consolidated Balance Sheet at December 31, 2023 and were paid on January 16, 2024. ​ During the fourth quarter of 2023, the Company declared monthly dividends on the Series A Preferred Shares for October, November, and December 2023 in the amount of $0.08854 per Depositary Share.
The December dividends and distributions were recorded as a liability on the consolidated balance sheets at December 31, 2024 and were paid on January 15, 2025. ​ During 2024, the Company declared monthly dividends on the Series A Preferred Shares totaling $1.063 per Depositary Share.
The holder of the Operating Partnership Common Units is entitled to an equal distribution per Operating Partnership Common Unit held. The dividends and distributions payable for October and November were paid during the quarter.
The holder of the Operating Partnership Common Units is entitled to an equal distribution per Operating Partnership Common Unit held.
The increase in interest expense was primarily a result of higher levels of borrowings in 2023 in comparison to 2022 in order to finance the acquisition and development of additional properties, as well as higher interest rates under the Revolving Credit Facility.
The increase in interest expense was primarily a result of higher levels of borrowings during the year ended December 31, 2024 compared to the year ended December 31, 2023 in order to finance the acquisition and development of additional properties.
Borrowings increased due to the $350 million 2029 Unsecured Term Loan that closed in July 2023 and the issuance of the $300 million 2032 Senior Unsecured Public Notes in August 2022.
Borrowings increased due to the $450.0 million 2034 Senior Unsecured Public Notes that were issued in May 2024 and the $350.0 million 2029 Unsecured Term Loan (defined below) that closed in July 2023.
(2) The interest rate of the Unsecured Term Loan reflects the spread of 95 basis points plus the impact of the interest rate swaps which convert $350 million of SOFR based interest to a fixed interest rate of 3.57%. (3) All-in interest rate for Senior Unsecured Notes reflects the straight-line amortization of the terminated swap agreements, as applicable.
(2) The interest rate of the Unsecured Term Loan reflects the spread of 85 basis points, plus a 10 basis point SOFR adjustment and the impact of the interest rate swaps which convert $350.0 million of SOFR based interest to a fixed interest rate of 3.57%.
Net cash provided by operating activities for the year ended December 31, 2023 increased by $29.5 million over 2022, primarily due to the increase in the size of the Company’s real estate investment portfolio, partially offset by normal course changes in working capital as well as the proceeds received in connection with the settlement of interest rate swaps during 2022.
Net cash provided by operating activities for the year ended December 31, 2024 increased by $40.4 million over the year ended December 31, 2023, primarily due to the increase in the size of the Company’s real estate investment portfolio.
These borrowings resulted in increases in interest expense during the year ended December 31, 2023 of $6.7 million related to the 2029 Unsecured Term Loan, $7.1 million related to the 2032 Senior Unsecured Public Notes, and $0.5 million related to the amortization of deferred financing fees.
The 2034 Senior Unsecured Public Notes and 2029 Unsecured Term Loan resulted in increases in interest expense and related amortization of the original issuance discount and deferred financing costs during the year ended December 31, 2024 of $17.0 million and $9.8 million, respectively. The Company recognized $7.2 million provision for impairment during both years ended December 31, 2024 and 2023.
The Indenture contains various restrictive covenants, including limitations on the ability of the guarantors and the issuer to incur additional indebtedness and requirements to maintain a pool of unencumbered assets. ​ Mortgage Notes Payable As of December 31, 2023, the Company had total gross mortgage indebtedness of $44.9 million which was collateralized by related real estate and tenants’ leases with an aggregate net book value of $79.3 million.
Mortgage Notes Payable As of December 31, 2024, the Company had total gross mortgage indebtedness of $43.9 million which was collateralized by related real estate and tenants’ leases with an aggregate net book value of $76.3 million. The weighted average interest rate on the Company’s mortgage notes payable was 3.73% as of December 31, 2024.
Unlike many of its peers, the Company has acquired the substantial majority of its net-leased properties through acquisitions of properties from third parties or in connection with the acquisitions of ground leases from third parties.
Unlike many of its peers, the Company has acquired the substantial majority of its net-leased properties through acquisitions of properties from third parties or in connection with the acquisitions of ground leases from third parties. 41 Table of Contents Core FFO should not be considered an alternative to net income as the primary indicator of the Company’s operating performance, or as an alternative to cash flow as a measure of liquidity.
Overview The Company is a fully integrated REIT primarily focused on the ownership, acquisition, development and management of retail properties net leased to industry leading tenants. The Company was founded in 1971 by its current Executive Chairman, Richard Agree, and its common stock was listed on the NYSE in 1994.
The Company was founded in 1971 by its current Executive Chairman, Richard Agree, and its common stock was listed on the NYSE in 1994.
The underwritten weighted-average capitalization rate on the acquisitions was 6.9%. 1 Dispositions During the year ended December 31, 2023, the Company sold six assets, including one former corporate headquarters office building, for net proceeds of $13.8 million.
The underwritten weighted-average capitalization rate on the acquisitions was 7.5%. 1 Dispositions During the year ended December 31, 2024, the Company sold 26 assets and land parcels for net proceeds of $94.3 million and recorded a net gain of $11.5 million.
Preferred Stock Offering As of December 31, 2023, the Company had 7,000,000 depositary shares (the “Depositary Shares”) outstanding, each representing 1/1,000th of a share of Series A Preferred Stock.
Upon settlement, the offering is anticipated to raise net proceeds of approximately $368.0 million after deducting fees and expenses and making certain adjustments as provided in the forward sale agreements. Preferred Stock Offering As of December 31, 2024, the Company had 7,000,000 depositary shares (the “Depositary Shares”) outstanding, each representing 1/1,000th of a share of Series A Preferred Stock.
Gains on sales of assets are dependent on the levels of disposition activity and the assets’ basis relative to their sales prices. As a result, such gains are not necessarily comparable period-to-period. Provision for impairment increased $6.2 million to $7.2 million for the year ended December 31, 2023, compared to $1.0 million for the year ended December 31, 2022.
The increase was primarily due to the growth in disposition volume during 2024 as compared to 2023. Gains and losses on sale of assets are dependent on levels of disposition activity and the carrying value of the assets relative to their sales prices. As a result, such gains on sales are not necessarily comparable period-to-period.
Proceeds from asset sales are dependent on levels of disposition activity and the specific assets sold and are not necessarily comparable period-to-period.
Proceeds from asset sales are dependent on levels of disposition activity and the specific assets sold and are not necessarily comparable period-to-period; and ● $17.7 million increase in cash used for development of real estate investments and other assets due to increase in the number of development and DFP projects in progress as well as the timing of payments for these projects and other capital additions.
(4) The principal amounts outstanding are presented excluding their original issue discounts. ​ Senior Unsecured Revolving Credit Facility The Company’s First Amendment to the Third Amended and Restated Revolving Credit Agreement provides for a $1.0 billion Revolving Credit Facility and converted the interest rate on the existing $1.0 billion Revolving Credit Facility from a spread over LIBOR to a spread over SOFR plus a SOFR adjustment of 10 basis points.
(4) The principal amounts outstanding are presented excluding their original issue discounts. ​ Senior Unsecured Revolving Credit Facility In August 2024, the Company entered into the Fourth Amended and Restated Revolving Credit Agreement which provides for a $1.25 billion senior unsecured revolving credit facility.
(see Liquidity and Capital Resources – Debt below). Gain on sale of assets decreased $3.5 million to $1.8 million for the year ended December 31, 2023, compared to $5.3 million for the year ended December 31, 2022. Six properties were sold during the year ended December 31, 2023 while seven properties were sold during the year ended December 31, 2022.
A net gain of $11.5 million was recognized on the sale of 26 assets and land parcels during the year ended December 31, 2024, compared to a net gain of $1.8 million recognized on the sale of six assets during the year ended December 31, 2023.
Financing - Net cash provided by financing activities decreased by $368.5 million during the year ended December 31, 2023, compared to 2022 primarily due to: ● Net proceeds from the issuance of common stock decreased by $567.9 million; 36 Table of Contents ● Net borrowings under the Revolving Credit Facility increased by $187.0 million.
Financing - Net cash provided by financing activities decreased by $423.7 million during the year ended December 31, 38 Table of Contents 2024, compared to the year ended December 31, 2023 primarily due to: ● $287.0 million decrease of net proceeds from the issuance of common stock; ● $26.0 million increase in total dividends and distributions paid as a result of the increase in the number of common shares outstanding as well as the increase in the common stock dividend rate.
During the year ended December 31, 2023 , $350 million of proceeds were received as a result of the issuance of the 2029 Unsecured Term Loan while $297.5 million of proceeds were received during the year ended December 31, 2022 from the issuance of the 2032 Senior Unsecured Public Notes; and ● Payments of mortgage notes payable decreased $19.0 million driven by the principal repayment on interest only mortgage notes payable.
During the year ended December 31, 2024, the Company received proceeds of $444.7 million from the issuance of the 2034 Senior Unsecured Public Notes in May 2024 while $350.0 million of proceeds were received in connection with the 2029 Unsecured Term Loan that closed in July 2023.
The margins for the Revolving Credit Facility are subject to improvement based on the Company's leverage ratio, provided its credit ratings meet a certain threshold. Based on the Company's credit ratings and leverage ratio at the time of closing, pricing on the Revolving Credit Facility was 87.5 basis points over SOFR.
The margins for the Revolving Credit Facility are subject to adjustment based on changes in the Company's leverage ratio and credit ratings.
Material Cash Requirements In conducting our business, the Company enters into contractual obligations, including those for debt and operating leases for land. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2025 2026 2027 2028 Thereafter Total Mortgage Notes Payable ​ $ 963 ​ $ 1,026 ​ $ 629 ​ $ — ​ $ — ​ $ 42,250 ​ $ 44,868 Revolving Credit Facility (1) ​ — ​ — ​ 227,000 ​ — ​ — ​ — ​ 227,000 Unsecured Term Loan ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 350,000 ​ ​ 350,000 Senior Unsecured Notes ​ — ​ 50,000 ​ — ​ 50,000 ​ 410,000 ​ 1,300,000 ​ 1,810,000 Land Lease Obligations ​ 7,449 ​ 1,197 ​ 1,195 ​ 1,042 ​ 1,013 ​ 27,796 ​ 39,692 Estimated Interest Payments on Outstanding Debt (2) ​ 99,497 ​ 98,217 ​ 83,652 ​ 81,812 ​ 75,811 ​ 136,285 ​ 575,274 Total ​ $ 107,909 ​ $ 150,440 ​ $ 312,476 ​ $ 132,854 ​ $ 486,824 ​ $ 1,856,331 ​ $ 3,046,834 (1) The Revolving Credit Facility matures in January 2026, with options to extend the maturity date by six months up to two times, for a maximum maturity of January 2027.
Material Cash Requirements In conducting our business, the Company enters into contractual obligations, including those for debt and operating leases for land. ​ Details on these obligations as of December 31, 2024, including expected settlement periods, is contained below ( presented in thousands ): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 2026 2027 2028 2029 Thereafter Total Mortgage Notes Payable ​ $ 1,025 ​ $ 629 ​ $ — ​ $ — ​ $ 42,250 ​ $ — ​ $ 43,904 Revolving Credit Facility (1) ​ — ​ — ​ — ​ 158,000 ​ — ​ — ​ 158,000 Unsecured Term Loan ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 350,000 ​ ​ — ​ ​ 350,000 Senior Unsecured Notes ​ 50,000 ​ — ​ 50,000 ​ 410,000 ​ 100,000 ​ 1,650,000 ​ 2,260,000 Land Lease Obligations ​ 1,546 ​ 1,552 ​ 1,413 ​ 1,385 ​ 1,376 ​ 34,478 ​ 41,750 Estimated Interest Payments on Outstanding Debt (2) ​ 114,404 ​ 113,475 ​ 112,220 ​ 102,925 ​ 120,405 ​ 201,274 ​ 764,703 Total ​ $ 166,975 ​ $ 115,656 ​ $ 163,633 ​ $ 672,310 ​ $ 614,031 ​ $ 1,885,752 ​ $ 3,618,357 (1) The Revolving Credit Facility matures in August 2028, with options to extend the maturity date by six months up to two times, for a maximum maturity of August 2029.
The change was the result of the growth in the portfolio partially offset by 31 Table of Contents the items discussed above.
Net income increased $19.3 million, or 11%, to $189.8 million for the year ended December 31, 2024, compared to $170.5 million for the year ended December 31, 2023. The change was the result of the growth in the portfolio partially offset by the items discussed above.
The Company used the existing $350 million of forward starting interest rate swaps to hedge the variable SOFR priced interest to a weighted average fixed rate of 3.57% until January 2029. Senior Unsecured Notes – Private Placement The Senior Unsecured Notes (collectively the “Private Placements”) were issued in private placements to individual investors.
Senior Unsecured Notes – Private Placement The Senior Unsecured Notes (collectively the “Private Placements”) were issued in private placements to individual investors.
The Company’s annualized common stock dividend declared during the fourth quarter of 2023 of $2.964 per common share, represents a 2.9% increase over the annualized dividend amount of $2.880 per common share declared in December 2022; ● Net proceeds from unsecured borrowings increased by $52.5 million.
The Company’s annual common stock dividend declared during the year ended December 31, 2024 of $3.000 per common share, represents a 2.8% increase over the annual dividend amount of $2.919 per common share declared during 2023; ● $196.0 million change in net repayments on the Revolving Credit Facility.
Borrowings under the Term Loan are priced at SOFR plus a spread of 80 to 160 basis points over SOFR, depending on the Company’s credit ratings, plus a SOFR adjustment of 10 basis points. Based on the Company’s credit ratings at the time of closing, pricing on the 2029 Unsecured Term Loan was 95 basis points over SOFR.
The interest rate under the previous credit facility was based on a pricing grid with a range of 72.5 to 140 basis points over SOFR, determined by the Company's credit ratings and leverage ratio, plus a SOFR adjustment of 10 basis points.
As of December 31, 2023, the Company entered into forward sale agreements to sell an aggregate of 10,197,230 shares of common stock under the 2022 ATM Program, for anticipated net proceeds of $669.1 million.
(3) After considering the shares of common stock sold subject to forward sale agreements under the October 2024 ATM Program, the Company had approximately $1.24 billion of availability under the October 2024 ATM Program as of December 31, 2024.
The Company has settled 6,363,359 shares of these forward sale agreements as of December 31, 2023 for net proceeds of approximately $433.4 million after deducting fees and expenses. The Company is required to settle the remaining outstanding shares of common stock under the 2022 ATM Program by January 2025.
The Company settled all of these forward sale agreements during the year ended December 31, 2022 resulting in net proceeds to the Company of approximately $368.7 million after deducting fees and expenses and making certain other adjustments.
Removed
At December 31, 2023 the Company had 16 development or Developer Funding Platform projects under construction.
Added
The weighted-average capitalization rate on the dispositions was 6.7%. 1 Development and Developer Funding Platform During the year ended December 31, 2024, the Company commenced 25 development and DFP projects.
Removed
Comparison of Year Ended December 31, 2023 to Year Ended December 31, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ Variance ​ December 31, 2023 December 31, 2022 (in dollars) (percentage) Rental Income ​ $ 537,403 ​ $ 429,632 ​ $ 107,771 ​ 25 % Real Estate Tax Expense ​ $ 40,092 ​ $ 32,079 ​ $ 8,013 ​ 25 % Property Operating Expense ​ $ 24,961 ​ $ 18,585 ​ $ 6,376 ​ 34 % Depreciation and Amortization Expense ​ $ 176,277 ​ $ 133,570 ​ $ 42,707 ​ 32 % ​ The variances in rental income, real estate tax expense, property operating expense and depreciation and amortization expense shown above were due to the acquisition and the ownership of an increased number of properties during the year ended December 31, 2023 compared to the year ended December 31, 2022 , as further described under Results of Operations - Overall above .
Added
As of December 31, 2024, we had over $2.00 billion of liquidity, which consisted of cash and cash equivalents of $6.4 million, unsettled forward equity of $919.9 million and $1.09 billion of availability under our Revolving Credit Facility, subject to compliance with covenants.
Removed
In addition, borrowing levels and interest rates on the Revolving Credit Facility during the year ended December 31, 2023 were higher than the comparative period in 2022 resulting in an increase in interest expense of $4.4 million.
Added
In October 2024, the Company completed a follow-on public offering of 5,060,000 shares of common stock, including the full exercise of the underwriters’ option to purchase an additional 660,000 shares in connection with the forward sale agreements. As of December 31, 2024, the Company has not settled any of these shares.
Removed
These increases in interest expense during 2023 were partially offset by an increase of $0.7 million of capitalized interest during the year ended December 31, 2023 as compared to the same period in 2022 due to the increased level of activity in development and Development Funding Platform projects during 2023 as well as a decrease of $0.5 million of interest expense related to mortgages driven by the repayment of mortgage principal during 2023 and 2022.
Added
The previous $1.00 billion February 2024 ATM program was terminated following the establishment of the October 2024 ATM Program.
Removed
In September 2023, the Company repaid a $4.6 million, 5.01% per annum, interest only mortgage note at maturity.
Added
As a result, no future issuances will occur under the February 2024 ATM Program. 34 Table of Contents ​ The following table summarizes the ATM programs that were in place during the years ended December 31, 2024, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Program Year ​ Program Size ($ million) ​ Total Forward Shares Sold ​ Total Forward Shares Settled ​ Total Forward Shares Outstanding as of December 31, 2024 ​ Total Net Proceeds Anticipated or Received from Shares Sold ($ million) February 2021 * $500.0 ​ 5,453,975 ​ 5,453,975 ​ - ​ $379.1 September 2022 * $750.0 ​ 10,217,973 ​ 10,217,973 ​ - ​ $670.3 February 2024 * $1,000.0 ​ 10,409,017 ​ 2,775,498 ​ 7,633,519 (1) ​ $706.0 October 2024 ​ $1,250.0 ​ 168,277 (3) ​ - ​ 168,277 (2) ​ $12.9 *Applicable ATM program terminated and no future forward sales will occur under the program.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

9 edited+3 added−1 removed5 unchanged
Biggest changeAs of December 31, 2023, these interest rate swaps were valued as a liability of approximately $3.2 million. The Company does not use derivative instruments for trading or other speculative purposes, and the Company did not have any other derivative instruments as of December 31, 2023.
Biggest changeThe Company does not use derivative instruments for trading or other speculative purposes, and the Company did not have any other derivative instruments as of December 31, 2024. 44 Table of Contents The fair value of the mortgage notes payable and senior unsecured notes is estimated to be $40.6 million and $2.08 billion, respectively, as of December 31, 2024.
In June 2023, the Company entered into $350 million of forward starting interest rate swap agreements to hedge against variability in future cash flows resulting from changes in SOFR. The swaps exchange variable rate interest on $350 million of SOFR indexed debt to a weighted average fixed interest rate of 3.57% beginning August 1, 2023 through January 1, 2029.
In June 2023, the Company entered into $350.0 million of forward starting interest rate swap agreements to hedge against variability in future cash flows resulting from changes in SOFR. The swaps exchange variable rate interest on $350.0 million of SOFR indexed debt to a weighted average fixed interest rate of 3.57% beginning August 1, 2023 through January 1, 2029.
The table above incorporates those exposures that exist as of December 31, 2023; it does not consider those exposures or positions which could arise after that date. As a result, the Company’s ultimate realized gain or loss with respect to interest rate fluctuations will depend on the exposures that arise during the period and interest rates.
The table above incorporates those exposures that exist as of December 31, 2024; it does not consider those exposures or positions which could arise after that date. As a result, the Company’s ultimate realized gain or loss with respect to interest rate fluctuations will depend on the exposures that arise during the period and interest rates.
The extent of this risk is not quantifiable or predictable because of the variability of future interest rates and our future financing requirements. The Company’s interest rate risk is monitored using a variety of techniques.
The extent of this risk is not quantifiable or predictable because of the variability of future interest rates and our future financing requirements. 43 Table of Contents The Company’s interest rate risk is monitored using a variety of techniques.
(2) The interest rate of the Unsecured Term Loan reflects the credit spread of 95 basis points plus the impact of the interest rate swaps which convert $350 million of SOFR based interest to a fixed interest rate of 3.57%.
(2) The interest rate of the Unsecured Term Loan reflects the credit spread of 85 basis points, plus a 10 basis point SOFR adjustment and the impact of the interest rate swaps which convert $350.0 million of SOFR based interest to a fixed interest rate of 3.57%.
The swaps are designated to hedge the variable rate interest payments indexed to SOFR in the Senior Unsecured Term Loan which matures January 2029. As of December 31, 2023, these interest rate swaps were valued as a liability of approximately $1.3 million.
The swaps are designated to hedge the variable rate interest payments indexed to SOFR in the Senior Unsecured Term Loan which matures January 2029. As of December 31, 2024, these interest rate swaps were valued as an asset of approximately $5.2 million.
Average interest rates shown reflect the impact of the swap agreements employed to fix interest rates. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2025 2026 2027 2028 Thereafter Total Mortgage Notes Payable ​ $ 963 $ 1,026 $ 629 $ — $ — $ 42,250 ​ $ 44,868 Average Interest Rate ​ ​ 6.27 % ​ 6.27 % ​ 6.27 % ​ ​ ​ ​ ​ ​ ​ 3.63 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revolving Credit Facility (1) ​ ​ $ — ​ $ — ​ $ 227,000 $ ​ ​ $ — ​ $ — ​ $ 227,000 Average Interest Rate ​ ​ ​ ​ ​ ​ ​ ​ ​ 6.20 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unsecured Term Loan ​ ​ $ — ​ $ — ​ $ — $ — ​ $ — ​ $ 350,000 ​ $ 350,000 Average Interest Rate (2) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4.52 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Senior Unsecured Notes ​ ​ $ — ​ $ 50,000 ​ $ — ​ $ 50,000 ​ $ 410,000 ​ $ 1,300,000 ​ $ 1,810,000 Average Interest Rate ​ ​ ​ ​ ​ ​ 4.16 % ​ ​ ​ ​ 4.26 ​ ​ 2.45 % 3.51 % ​ ​ (1) The Revolving Credit Facility matures in January 2026, with options to extend the maturity date by six months up to two times, for a maximum maturity of January 2027.
Average interest rates shown reflect the impact of the swap agreements employed to fix interest rates. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 2026 2027 2028 2029 Thereafter Total Mortgage Notes Payable ​ $ 1,025 $ 629 $ — $ — $ 42,250 $ — ​ $ 43,904 Average Interest Rate ​ ​ 6.27 % ​ 6.27 % ​ ​ ​ ​ ​ ​ ​ 3.63 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revolving Credit Facility (1) ​ ​ $ — ​ $ — ​ $ — $ 158,000 ​ $ — ​ $ — ​ $ 158,000 Average Interest Rate ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 5.43 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unsecured Term Loan ​ ​ $ — ​ $ — ​ $ — $ — ​ $ 350,000 ​ $ — ​ $ 350,000 Average Interest Rate (2) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 4.52 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Senior Unsecured Notes ​ ​ $ 50,000 ​ $ — ​ $ 50,000 ​ $ 410,000 ​ $ 100,000 ​ $ 1,650,000 ​ $ 2,260,000 Average Interest Rate ​ ​ ​ 4.16 % ​ ​ ​ ​ 4.26 % ​ 2.45 % ​ 4.19 % 4.05 % ​ ​ (1) The Revolving Credit Facility matures in August 2028, with options to extend the maturity date by six months up to two times, for a maximum maturity of August 2029.
The fair value of the mortgage notes payable and senior unsecured notes is estimated to be $41.2 million and $1.60 billion, respectively, as of December 31, 2023. The fair value of the Revolving Credit Facility and Unsecured Term Loan approximate their carrying values as they are variable rate debt.
The fair value of the Revolving Credit Facility and Unsecured Term Loan approximate their carrying values as they are variable rate debt. At December 31, 2024, our outstanding Mortgage Notes Payable and Senior Unsecured Notes had fixed interest rates.
In December 2023, the Company entered into $150 million forward-starting interest rate swap agreements to hedge against changes in future cash flows resulting from changes in SOFR.
In August and September 2024, the Company entered into forward-starting interest rate swap agreements to hedge against variability in future cash flows resulting from changes in interest rates from the trade date through the forecasted issuance date of $200.0 million of long-term debt.
Removed
The swaps exchange variable rate SOFR interest on $150 million of SOFR indexed debt to a weighted average fixed interest rate of 3.60% beginning December 31, 2024 through 41 Table of Contents the maturity date of December 31, 2034. The swaps are designated to hedge previously unhedged variable rate interest payments indexed to SOFR.
Added
The Company hedged its exposure to the variability in future cash flows for a forecasted issuance of long-term debt over a maximum period ending April 2026. As of December 31, 2024, these interest rate swaps are valued as an asset of approximately $12.3 million.
Added
Interest on our Revolving Credit Facility and Unsecured Term Loan is variable, and as a result, we are subject to interest rate risk with respect to such floating-rate debt.
Added
Assuming no change in the outstanding borrowings under the Revolving Credit Facility during fiscal 2025, a hypothetical 100-basis point increase or decrease in market interest rates sustained throughout the year would change our annual interest expense by $1.6 million. The variable interest rate feature on our Unsecured Term Loan has been mitigated by interest rate swap agreements.

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