Group 1 - The focus is on Class A properties in growth-oriented sectors such as e-commerce warehouses and data centers [1] - The company owns large and well-diversified portfolios of income-producing real estate [1] - The latest top investment picks for August 2025 have been released, providing immediate access to exciting opportunities [1] Group 2 - The company invests thousands of hours and over $100,000 annually into researching profitable investment opportunities [2] - This approach has resulted in over 500 five-star reviews from satisfied members [2] - The company encourages potential investors to join now to start maximizing their returns [2]

Core Insights - The article emphasizes the importance of not making significant capital allocation decisions based solely on assumptions regarding future interest rate paths [1]. Group 1: Analyst Background - Roberts Berzins has over a decade of experience in financial management, assisting top-tier corporates in shaping financial strategies and executing large-scale financings [1]. - He has contributed to institutionalizing the REIT framework in Latvia to enhance the liquidity of pan-Baltic capital markets [1]. - His policy-level work includes developing national SOE financing guidelines and frameworks for channeling private capital into affordable housing [1]. - Berzins holds a CFA Charter and an ESG investing certificate, and has interned at the Chicago Board of Trade [1]. Group 2: Market Context - The article suggests that the current macroeconomic environment should be approached with caution, particularly regarding interest rate assumptions [1].

Group 1: Company Overview - Sun Communities is a leading player in mobile home parks and RV resorts, expected to benefit from the growing older population, providing a lower-cost living option [3] - Agree Realty focuses on single-tenant net-lease retail properties, with a portfolio of approximately 2,400 properties, indicating significant room for growth through acquisitions [5] Group 2: Dividend Comparison - Agree Realty offers a higher dividend yield of 4.2% compared to Sun Communities' yield of just under 3.4%, making it more attractive for income-focused investors [6] - Sun Communities has increased its dividend annually for nine consecutive years, while Agree Realty has a longer history of dividend increases since 2012, despite a switch to monthly payments [7] - Over the past decade, Sun Communities' dividend has grown at an annualized rate of roughly 4%, while Agree's has grown at approximately 5%, indicating a stronger growth rate for Agree [8] Group 3: Future Growth Potential - The net-lease retail property niche presents a larger opportunity set compared to the mobile home park sector, as it is generally easier to build retail properties than to get new mobile home parks approved [9] - Agree Realty's growth strategy is primarily driven by acquisitions, positioning it for robust long-term growth compared to Sun Communities [10]

Company Participants - The conference call featured key participants including Joel N. Agree (President, CEO & Director), Peter Coughenour (CFO, Secretary & Investor Relations Professional), and Reuben Goldman Treatman (Senior Director of Corporate Finance) [1]. Conference Call Overview - The call was initiated by Reuben Treatman, who welcomed participants and noted that the event was being recorded [2][3]. Forward-Looking Statements - The company indicated that certain statements made during the call may be considered forward-looking under federal securities law, particularly regarding updated guidance for 2025 [4].

Financial Data and Key Metrics Changes - The company invested over $725 million across its three external growth platforms in the first half of the year, representing more than a twofold increase compared to the same period last year [6] - The full-year investment volume guidance has been raised to a range of $1.4 billion to $1.6 billion, which is a 58% increase over the previous year's total investment volume [6] - Core FFO per share was $1.05 for the second quarter, a 1.3% increase year-over-year, while AFFO per share was $1.06, reflecting a 1.7% year-over-year increase [19] - The updated full-year AFFO per share guidance is now between $4.29 and $4.32, indicating over 4% growth at the midpoint [19] Business Line Data and Key Metrics Changes - In the second quarter, the company invested over $350 million in 110 properties, including $328 million in acquisition volume across 91 high-quality retail net lease assets [10] - The weighted average cap rate of acquired properties was 7.1%, with a weighted average lease term of 12.2 years [11] - The company executed new leases, extensions, or options on approximately 950,000 square feet of gross leasable area during the quarter, with a recapture rate of approximately 104% [13] Market Data and Key Metrics Changes - The company noted the highest level of retailer demand for new brick-and-mortar locations since the Great Financial Crisis, with nearly every retailer in its focus area looking to add new stores [10] - The investment-grade exposure stood at 68%, and occupancy rebounded to 99.6% after re-tenanting efforts [15] Company Strategy and Development Direction - The company aims to solidify its dominant market position through a best-in-class team executing hundreds of transactions annually across its three growth platforms [7] - The company is focused on core durable goods and necessity-based retailers, avoiding experiential and discretionary sectors [31] - The development platform is expected to ramp up significantly, with plans to break ground on a minimum of $100 million in projects before year-end [40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the portfolio's defensive nature and the ability to provide consistent earnings growth without increasing risk [7] - The management acknowledged a deterioration in consumer sentiment but emphasized that their focus on necessity-based retailers positions them well in the current environment [31] - The company anticipates that larger retailers will continue to gain market share, benefiting from their stronger balance sheets and ability to manage costs [33] Other Important Information - The company raised over $1 billion in capital year-to-date, with total liquidity standing at $2.3 billion [8] - The monthly cash dividend declared for the second quarter was $0.0256 per common share, representing a 2.4% year-over-year increase [23] Q&A Session Summary Question: Can you provide color on your ATM activity in Q2 and the timing of your overnight equity offering? - Management confirmed that ATM activity during the quarter predated the overnight offering in April and that they remained inactive in the capital markets post-offering [27][28] Question: What is the outlook for acquisition cap rates going forward? - Management indicated that acquisition cap rates could expand, with no new tenants targeted outside their established focus area [29] Question: How is the health of retailers and consumers currently? - Management noted a deterioration in consumer sentiment but emphasized that their focus on core durable goods retailers positions them favorably [30][31] Question: What opportunities do you see in the development business? - Management expressed excitement about the development pipeline, with plans to break ground on significant projects before year-end [39][40] Question: Is there an upper limit to investment in the development platform? - Management stated that while they have set a goal of investing $250 million annually in development, they are open to further investments as opportunities arise [60][62] Question: Can you provide an update on your watch list? - Management indicated that the watch list is minimal, primarily focused on a few movie theaters and previously mentioned retailers [90][92]

Financial Data and Key Metrics Changes - The company invested over $725 million across its three external growth platforms in the first half of the year, representing more than a twofold increase compared to the same period last year [5] - Core FFO per share was $1.05 for Q2, a 1.3% increase year-over-year, while AFFO per share was $1.06, reflecting a 1.7% year-over-year increase [19] - The full year AFFO per share guidance was raised to a range of $4.29 to $4.32, indicating over 4% growth at the midpoint [8][19] Business Line Data and Key Metrics Changes - In Q2, the company invested over $350 million in 110 properties, including $328 million in acquisition volume across 91 high-quality retail net lease assets [10] - The weighted average cap rate of acquired properties was 7.1%, with a weighted average lease term of 12.2 years [11] - The company executed new leases, extensions, or options on approximately 950,000 square feet of gross leasable area during the quarter, with a recapture rate of approximately 104% [13] Market Data and Key Metrics Changes - The company noted the highest level of retailer demand for new brick-and-mortar locations since the Great Financial Crisis, with nearly every retailer focused on adding net new stores [10] - The investment grade exposure stood at 68%, and occupancy rebounded to 99.6% post re-tenanting of former Big Lots [14] Company Strategy and Development Direction - The company is focused on maintaining a dominant market position through a best-in-class team and a robust asset management platform [6] - The company anticipates a significant ramp-up in development spending, expecting at least a 50% year-over-year increase [12] - The strategic focus remains on core durable goods and necessity-based retailers, avoiding discretionary and experiential sectors [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to provide consistent earnings growth without deviating from the investment strategy, despite a deteriorating consumer sentiment [30] - The company is well-positioned with over $2.3 billion in total liquidity and no material debt maturities until 2028, supporting growth into the next year [7][18] Other Important Information - The company raised over $1 billion in capital year-to-date, with total capital markets activity exceeding $1.3 billion [17] - The monthly cash dividend declared for Q2 was $0.0256 per common share, representing a 2.4% year-over-year increase [22] Q&A Session Summary Question: Can you give us some color about your ATM activity in 2Q and overall timing given your overnight equity offering in late April? - The ATM activity during the quarter all predated the overnight offering in April, and the company promised to remain inactive in the capital markets post-offering [26][27] Question: What’s the magnitude of acquisition cap rates going forward? - The company anticipates acquisition cap rates to expand but will remain focused within their established tenant base [28] Question: How are you thinking about retailer and consumer health right now? - Consumer health has deteriorated, but the focus remains on core durable goods and necessity-based retailers, which are expected to gain market share [30][32] Question: Can you talk about some of the opportunities in the DFT business for developments? - The company plans to break ground on a minimum of $100 million in projects before year-end, with a significant shadow pipeline [39][40] Question: Is there an upper limit on investment in the development platform? - The company has set a three-year goal of investing $250 million annually in development, with no speculative development planned [60][62] Question: What is the status of your watch list? - The watch list is minimal, primarily focused on At Home and a few movie theaters, with no significant credit issues anticipated [86][89]

Company Overview - Agree Realty Corporation (ADC) is a retail net lease REIT with an enterprise value of $116 billion as of July 25, 2025[10] - The company owns 2,513 retail properties across all 50 states, totaling approximately 520 million square feet[10] - The company has investment grade issuer ratings of Baa1 from Moody's and BBB+ from S&P[10] Financial Highlights - The company raised 2025 AFFO per share guidance to $429 to $432, representing over 4% growth at the midpoint[13] - The company increased 2025 investment guidance to $14 billion to $16 billion of high-quality retail net lease assets[13] - The company invested $727 million during the first half of the year across 162 high-quality retail net lease assets spanning 27 states[13] - The company issued $400 million of senior unsecured notes due 2035 at an all-in interest rate of 535%[13] - The company has total liquidity of approximately $23 billion, including approximately $13 billion of outstanding forward equity as of June 30th[14] - The company declared a monthly cash dividend of $0256 per common share for July, representing a 24% year-over-year increase[14] Portfolio Composition - Investment grade tenants account for 678% of the portfolio's annualized base rent (ABR)[49] - National tenants comprise 88% of the portfolio's ABR[57] - Grocery stores represent 106% of the portfolio's ABR, amounting to $715 million[50]

Group 1 - Agree Realty (ADC) reported revenue of $175.53 million for the quarter ended June 2025, a year-over-year increase of 15.1% [1] - The earnings per share (EPS) for the same period was $1.06, compared to $0.52 a year ago, with no EPS surprise as the consensus estimate was also $1.06 [1][4] - The reported revenue exceeded the Zacks Consensus Estimate of $173.71 million by 1.05% [1] Group 2 - Rental income was reported at $175.4 million, surpassing the three-analyst average estimate of $169.93 million, reflecting a year-over-year change of +15.1% [4] - Operating cost reimbursement revenue was $19.38 million, exceeding the average estimate of $17.9 million based on two analysts, representing a year-over-year increase of 21.6% [4] - Other revenues were reported at $0.13 million, slightly above the estimated $0.1 million, but showed a year-over-year decline of 13.9% [4] Group 3 - Shares of Agree Realty have returned +1.2% over the past month, compared to the Zacks S&P 500 composite's +2.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Insights - Agree Realty (ADC) reported quarterly funds from operations (FFO) of $1.06 per share, matching the Zacks Consensus Estimate and showing an increase from $1.04 per share a year ago [1] - The company achieved revenues of $175.53 million for the quarter ended June 2025, exceeding the Zacks Consensus Estimate by 1.05% and up from $152.57 million year-over-year [2] - The stock has gained approximately 3.5% since the beginning of the year, underperforming compared to the S&P 500's gain of 8.2% [3] Financial Performance - The FFO outlook for the upcoming quarters is crucial for investors, with current consensus FFO expectations at $1.08 for the next quarter and $4.29 for the current fiscal year [7] - The company has surpassed consensus revenue estimates four times over the last four quarters, indicating a positive trend in financial performance [2] Market Position - The Zacks Industry Rank places the REIT and Equity Trust - Retail sector in the top 37% of over 250 Zacks industries, suggesting a favorable market environment [8] - The current Zacks Rank for Agree Realty is 3 (Hold), indicating expected performance in line with the market in the near future [6] Future Outlook - The estimate revisions trend for Agree Realty was mixed ahead of the earnings release, which may influence future stock performance [6] - Investors are encouraged to monitor changes in estimates for the coming quarters and the current fiscal year, as these can significantly impact stock movements [4][5]

[Agree Realty Corporation Second Quarter 2025 Results](index=1&type=section&id=Agree%20Realty%20Corporation%20Second%20Quarter%202025%20Results) [Financial and Operating Highlights](index=1&type=section&id=Financial_and_Operating_Highlights) The company reported AFFO per share growth and significant investment activity, bolstered by over $1 billion in capital raising Metric (Q2 2025) | Metric (Q2 2025) | Value | Change (YoY) | | :--- | :--- | :--- | | Investment | ~$350M in 110 properties | N/A | | Net Income per share | $0.43 | -18.5% | | Core FFO per share | $1.05 | +1.3% | | AFFO per share | $1.06 | +1.7% | | Monthly Dividend (June) | $0.256 per share | +2.4% | Metric (H1 2025) | Metric (H1 2025) | Value | Change (YoY) | | :--- | :--- | :--- | | Investment | ~$727M in 162 properties | N/A | | Net Income per share | $0.85 | -11.1% | | Core FFO per share | $2.09 | +2.2% | | AFFO per share | $2.12 | +2.4% | | Dividends Declared | $1.527 per share | +2.4% | - The company strengthened its balance sheet with significant capital activities, including a **$400 million bond offering** and raising approximately **$603 million in forward equity**, resulting in **$2.3 billion of liquidity** at quarter-end[5](index=5&type=chunk) [CEO Comments](index=4&type=section&id=CEO_Comments) The CEO highlighted strong performance driven by strategic capital raising, resulting in a "fortress" balance sheet with $2.3 billion in liquidity - Strategically raised over **$800 million of debt and equity capital** during the quarter[18](index=18&type=chunk) - The balance sheet is described as a **"fortress" with $2.3 billion of liquidity**, positioning it as fully funded for growth[18](index=18&type=chunk) [2025 Earnings Guidance](index=3&type=section&id=Earnings_Guidance) The company raised its full-year 2025 guidance for AFFO per share and increased its target for investment volume | Guidance Metric | Prior 2025 | Revised 2025 | | :--- | :--- | :--- | | **AFFO per share** | **$4.27 to $4.30** | **$4.29 to $4.32** | | **Investment volume** | **$1.3 to $1.5 billion** | **$1.4 to $1.6 billion** | | Disposition volume | $10 to $50 million | $10 to $50 million | | Income and other tax expense | $3 to $4 million | $2.5 to $3 million | [Financial Performance](index=2&type=section&id=Financial_Performance) [Key Financial Metrics (Q2 & H1 2025)](index=2&type=section&id=Key_Financial_Metrics) Net Income per share declined year-over-year, while key non-GAAP metrics like Core FFO and AFFO per share demonstrated growth Metric (Q2 2025 vs Q2 2024) | Metric (Q2 2025 vs Q2 2024) | Amount (Q2 2025) | Change | | :--- | :--- | :--- | | Net Income | $47.3M | -10.5% | | Net Income per share | $0.43 | -18.5% | | Core FFO | $115.9M | +11.3% | | Core FFO per share | $1.05 | +1.3% | | AFFO | $117.7M | +11.7% | | AFFO per share | $1.06 | +1.7% | Metric (H1 2025 vs H1 2024) | Metric (H1 2025 vs H1 2024) | Amount (H1 2025) | Change | | :--- | :--- | :--- | | Net Income | $92.5M | -3.5% | | Net Income per share | $0.85 | -11.1% | | Core FFO | $228.6M | +10.9% | | Core FFO per share | $2.09 | +2.2% | | AFFO | $231.6M | +11.1% | | AFFO per share | $2.12 | +2.4% | [Dividend](index=2&type=section&id=Dividend) The company declared a monthly dividend of $0.256 per share, a 2.4% year-over-year increase, maintaining a ~72% AFFO payout ratio - Declared monthly dividends of **$0.256 per common share** for Q2 2025, a **2.4% increase** over the prior year's second quarter[12](index=12&type=chunk) - The dividend payout ratios for Q2 and H1 2025 were approximately **73% of Core FFO per share** and **72% of AFFO per share**[12](index=12&type=chunk)[13](index=13&type=chunk) - Subsequent to quarter end, a monthly dividend of **$0.256** was declared for July 2025, and a preferred stock dividend of **$0.08854 per depositary share** was also declared[14](index=14&type=chunk)[15](index=15&type=chunk) [Portfolio and Operations](index=4&type=section&id=Portfolio_and_Operations) [Portfolio Overview](index=4&type=section&id=Portfolio_Overview) The portfolio consists of 2,513 properties across 50 states, featuring 99.6% occupancy and a high concentration of investment-grade tenants | Metric | Value | | :--- | :--- | | Properties | 2,513 | | States | 50 | | Gross Leasable Area | 52.0 million sq. ft. | | Occupancy | 99.6% leased | | Weighted-Avg. Lease Term | ~8.0 years | | Investment Grade ABR | 67.8% | [Investment Activity](index=4&type=section&id=Investment_Activity) The company invested heavily in acquisitions during H1 2025 while maintaining active development projects and minimal dispositions [Acquisitions](index=4&type=section&id=Acquisitions) The company acquired over $686 million in properties during the first half of 2025 at a weighted-average cap rate of 7.2% - Q2 2025 acquisition volume was approximately **$327.5 million** for 91 properties at a weighted-average capitalization rate of **7.1%** and a remaining lease term of 12.2 years[22](index=22&type=chunk)[23](index=23&type=chunk) - H1 2025 acquisition volume totaled approximately **$686.4 million** for 137 properties at a weighted-average capitalization rate of **7.2%** and a remaining lease term of 12.8 years[24](index=24&type=chunk) [Dispositions](index=4&type=section&id=Dispositions) Property dispositions were minimal in Q2, with full-year volume expected to remain low - Sold four properties for gross proceeds of approximately **$6.2 million** in Q2 2025[25](index=25&type=chunk) - Full-year 2025 disposition volume is anticipated to be between **$10 million and $50 million**[26](index=26&type=chunk) [Development and Developer Funding Platform (DFP)](index=5&type=section&id=Development_and_Developer_Funding_Platform) The company managed 25 development and DFP projects in H1 2025 with total anticipated costs of approximately $139.6 million - In H1 2025, the company had 25 development or DFP projects completed or under construction, with total anticipated costs of approximately **$139.6 million**[28](index=28&type=chunk) - Key tenants for these development projects include **TJX Companies, Burlington, 7-Eleven, Starbucks, and Sunbelt Rentals**[28](index=28&type=chunk) [Portfolio Composition](index=4&type=section&id=Portfolio_Composition) The portfolio is diversified by tenant, sector, and geography, with a significant, high-quality ground lease component [Ground Lease Portfolio](index=4&type=section&id=Ground_Lease_Portfolio) The ground lease portfolio comprises 10.3% of total ABR and is characterized by 100% occupancy and high investment-grade tenancy - The ground lease portfolio consisted of 232 leases, representing **10.3% of total annualized base rents**[20](index=20&type=chunk) - This portfolio segment was **100% occupied** with a weighted-average remaining lease term of 9.4 years and **88.1% of its ABR from investment-grade tenants**[21](index=21&type=chunk) [Top Tenants](index=7&type=section&id=Top_Tenants) The top tenant list is led by major national retailers like Walmart and Tractor Supply, with Genuine Parts Company added in Q2 - **Genuine Parts Company (NAPA Auto Parts)** was added to the top tenants list during Q2 2025, representing **1.7% of ABR**[31](index=31&type=chunk)[32](index=32&type=chunk) | Tenant | % of Annualized Base Rent | | :--- | :--- | | Walmart | 6.0% | | Tractor Supply | 4.8% | | Dollar General | 4.2% | | Best Buy | 3.2% | | O'Reilly Auto Parts | 3.1% | [Retail Sectors](index=8&type=section&id=Retail_Sectors) The portfolio's largest sector exposures are to defensive retail categories like Grocery Stores and Home Improvement | Sector | % of Annualized Base Rent | | :--- | :--- | | Grocery Stores | 10.6% | | Home Improvement | 8.8% | | Tire and Auto Service | 7.7% | | Convenience Stores | 7.6% | | Auto Parts | 7.0% | [Geographic Diversification](index=9&type=section&id=Geographic_Diversification) The portfolio is geographically diversified across the US, with Texas representing the largest single-state exposure by ABR | State | % of Annualized Base Rent | | :--- | :--- | | Texas | 7.2% | | Illinois | 6.0% | | Michigan | 5.4% | | Ohio | 5.1% | | Pennsylvania | 5.0% | [Leasing Activity and Expirations](index=6&type=section&id=Leasing_Activity_and_Expirations) The company executed significant leasing volume in H1 2025 while facing minimal lease expirations for the remainder of the year - Executed new leases, extensions, or options on **~948,000 sq. ft. in Q2** and **~1.5 million sq. ft. in H1 2025**[29](index=29&type=chunk)[30](index=30&type=chunk) - Notable Q2 leasing activity included a **218,000-square foot Walmart Supercenter** and five leases with **TJX Companies** totaling over 125,000-square feet[29](index=29&type=chunk) - Lease expirations for the remainder of 2025 are very low, accounting for only **0.4% of annualized base rent**[30](index=30&type=chunk) [Capital Structure and Liquidity](index=10&type=section&id=Capital_Structure_and_Liquidity) [Capital Markets Activity](index=10&type=section&id=Capital_Markets_Activity) The company actively managed its capital structure in Q2 through a significant bond offering and forward equity agreements - Completed a follow-on public offering of ~5.2 million shares in connection with forward sale agreements, anticipating net proceeds of **$387.2 million**[37](index=37&type=chunk) - Completed a **$400 million public bond offering** of 5.60% senior unsecured notes due 2035. The all-in rate is **5.35%** after considering terminated swap agreements[38](index=38&type=chunk) - As of June 30, 2025, the company had 17.5 million shares remaining to be settled under forward equity offerings, representing approximately **$1.3 billion in anticipated net proceeds**[39](index=39&type=chunk)[69](index=69&type=chunk) [Balance Sheet and Liquidity](index=10&type=section&id=Balance_Sheet_and_Liquidity) The company maintained substantial liquidity of $2.3 billion and a proforma net debt to recurring EBITDA of 3.1x - Total liquidity was **$2.3 billion** at quarter-end, including **$1.0 billion of availability** on the revolving credit facility and **$1.3 billion of outstanding forward equity**[40](index=40&type=chunk) | Metric (as of June 30, 2025) | Value | | :--- | :--- | | Net Debt to Recurring EBITDA | 5.2x | | Proforma Net Debt to Recurring EBITDA | 3.1x | | Fixed Charge Coverage Ratio | 4.2x | | Total Debt to Enterprise Value | 28.2% | [Financial Statements](index=13&type=section&id=Financial_Statements) [Consolidated Balance Sheet](index=13&type=section&id=Consolidated_Balance_Sheet) Total assets grew to $9.08 billion, driven by real estate investments, with a corresponding increase in liabilities and equity | Balance Sheet Item | June 30, 2025 ($ in thousands) | Dec 31, 2024 ($ in thousands) | | :--- | :--- | :--- | | Net real estate investments | $7,958,625 | $7,418,108 | | **Total Assets** | **$9,084,744** | **$8,486,446** | | **Total Liabilities** | **$3,430,340** | **$2,975,785** | | **Total Equity** | **$5,654,404** | **$5,510,661** | [Consolidated Statements of Operations](index=14&type=section&id=Consolidated_Statements_of_Operations) Revenues increased year-over-year, but higher operating expenses led to a decline in net income for the second quarter Income Statement (Three months ended June 30) | Income Statement (Three months ended June 30) | 2025 ($ in thousands) | 2024 ($ in thousands) | | :--- | :--- | :--- | | Total Revenues | $175,527 | $152,575 | | Total Operating Expenses | $95,031 | $77,784 | | Income from Operations | $82,006 | $81,967 | | **Net Income Attributable to Common Stockholders** | **$47,339** | **$52,865** | | Diluted EPS | $0.43 | $0.52 | Income Statement (Six months ended June 30) | Income Statement (Six months ended June 30) | 2025 ($ in thousands) | 2024 ($ in thousands) | | :--- | :--- | :--- | | Total Revenues | $344,687 | $302,029 | | Total Operating Expenses | $186,268 | $158,781 | | Income from Operations | $160,701 | $152,465 | | **Net Income Attributable to Common Stockholders** | **$92,476** | **$95,865** | | Diluted EPS | $0.85 | $0.95 | [Non-GAAP Reconciliations and Definitions](index=16&type=section&id=Non-GAAP_Reconciliations_and_Definitions) [Reconciliation of Net Income to FFO, Core FFO, and AFFO](index=16&type=section&id=Reconciliation_of_Net_Income_to_FFO_Core_FFO_and_AFFO) This section reconciles Net Income to FFO, Core FFO, and AFFO by adjusting for non-cash items like depreciation and amortization | Reconciliation (Q2 2025, $ in thousands) | Amount | | :--- | :--- | | Net Income | $49,353 | | *Adjustments (Depreciation, Amortization, etc.)* | ... | | **Funds from Operations (FFO)** | **$107,322** | | *Amortization of lease intangibles, net* | $8,620 | | **Core Funds from Operations (Core FFO)** | **$115,942** | | *Straight-line rent, Stock comp, etc.* | ... | | **Adjusted Funds from Operations (AFFO)** | **$117,677** | [Reconciliation of Non-GAAP Financial Measures (Debt & EBITDA)](index=18&type=section&id=Reconciliation_of_Non-GAAP_Financial_Measures_Debt_EBITDA) This section details the calculation of Net Debt and Recurring EBITDA, arriving at a proforma leverage ratio of 3.1x | Debt & EBITDA Calculation (Q2 2025, $ in thousands) | Amount | | :--- | :--- | | Total Debt per Balance Sheet | $3,219,545 | | **Net Debt** | **$3,241,488** | | Anticipated Net Proceeds from Forward Equity | ($1,289,392) | | **Proforma Net Debt** | **$1,952,096** | | Recurring EBITDA | $155,335 | | **Annualized Recurring EBITDA** | **$621,340** | [Supplemental Information (Rental Income)](index=20&type=section&id=Supplemental_Information_Rental_Income) This table details the components of rental income, including minimum rents, reimbursements, and non-cash adjustments | Rental Income Source (Q2 2025, $ in thousands) | Amount | | :--- | :--- | | Minimum rents | $160,205 | | Operating cost reimbursement | $19,383 | | Straight-line rental adjustments | $3,789 | | Amortization of (above) below market lease intangibles | ($8,537) | | **Total Rental Income** | **$175,397** | [Definitions of Non-GAAP Measures](index=16&type=section&id=Definitions_of_Non-GAAP_Measures) Key non-GAAP financial measures such as FFO, Core FFO, and AFFO are defined to clarify performance analysis - **FFO:** Net income excluding gains/losses from property sales and real estate depreciation[61](index=61&type=chunk) - **Core FFO:** FFO adjusted for non-cash amortization of above/below-market lease intangibles[63](index=63&type=chunk) - **AFFO:** Core FFO further adjusted for non-cash items like straight-line rent and stock-based compensation[64](index=64&type=chunk)