[Company Overview](index=4&type=section&id=Company%20Overview) FrontView REIT, Inc. (NYSE: FVR) is an internally-managed net-lease REIT focused on acquiring and managing properties with high road frontage, with a portfolio of 323 properties across 37 U.S. states as of March 31, 2025 [Company Profile](index=4&type=section&id=Company%20Profile) FrontView REIT, Inc. (NYSE: FVR) is an internally-managed net-lease REIT focused on acquiring and managing properties with high road frontage, with a portfolio of 323 properties across 37 U.S. states as of March 31, 2025 - The company's investment approach is differentiated by its focus on **properties in prominent locations with high visibility and direct frontage on high-traffic roads**[15](index=15&type=chunk) - The tenant base is **diversified** and includes service-oriented businesses such as restaurants, financial institutions, automotive stores, medical providers, and general retail[15](index=15&type=chunk) Portfolio Snapshot as of March 31, 2025 | Metric | Value | | :--- | :--- | | Properties | 323 | | U.S. States | 37 | [Financial Performance](index=5&type=section&id=Financial%20Performance) The company's Q1 2025 financial performance showed increased revenues and assets, a net loss, and positive non-GAAP metrics like FFO and AFFO, reflecting operational trends and balance sheet growth [Quarterly Financial Summary](index=5&type=section&id=Quarterly%20Financial%20Summary) For Q1 2025, FrontView REIT reported total revenues of **$16.2M** and a net loss of **$1.3M**, with total assets growing to **$860.8M** and AFFO at **$8.2M** or **$0.30 per diluted share** Q1 2025 Financial Highlights (vs. Q4 2024) | Metric | Q1 2025 | Q4 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $16.2M | $15.5M | +4.7% | | Net Loss | ($1.3M) | ($21.5M) | N/A | | FFO | $6.4M | ($10.0M) | N/A | | AFFO | $8.2M | $9.1M | -9.6% | | FFO per share, diluted | $0.23 | ($0.36) | N/A | | AFFO per share, diluted | $0.30 | $0.33 | -9.1% | | Total Assets | $860.8M | $821.8M | +4.7% | - The company's net cash from operating activities was **$8.1 million**, a significant increase from **$5.3 million** in the prior quarter[18](index=18&type=chunk) [Balance Sheet](index=6&type=section&id=Balance%20Sheet) As of March 31, 2025, total assets increased to **$860.8M** driven by real estate investments, while total liabilities rose to **$345.2M** and total equity slightly decreased to **$515.6M** Key Balance Sheet Items (March 31, 2025) | Account | Amount (in thousands) | | :--- | :--- | | Real estate held for investment, net | $710,563 | | Total assets | $860,835 | | Debt, net | $310,214 | | Total liabilities | $345,244 | | Total equity | $515,591 | [Income Statement Summary](index=7&type=section&id=Income%20Statement%20Summary) Q1 2025 rental revenues reached **$16.2M**, with total operating expenses at **$13.0M**, resulting in a net loss of **$1.3M** or **($0.06) per diluted share** Q1 2025 Income Statement Highlights | Account | Amount (in thousands) | | :--- | :--- | | Rental revenues | $16,243 | | Total operating expenses | $13,020 | | Interest expense | $4,497 | | Net loss | ($1,337) | | Net loss per share, diluted | ($0.06) | [Funds From Operations (FFO) and Adjusted Funds From Operations (AFFO)](index=8&type=section&id=Funds%20From%20Operations%20(FFO)%20and%20Adjusted%20Funds%20From%20Operations%20(AFFO)) For Q1 2025, FFO recovered to **$6.4M** (**$0.23 per share**) from a negative Q4 2024, while AFFO was **$8.2M** (**$0.30 per share**) FFO and AFFO Reconciliation (Q1 2025) | Metric | Amount (in thousands) | Per Diluted Share | | :--- | :--- | :--- | | Net loss | ($1,337) | ($0.06) | | Depreciation & Amortization | $7,805 | - | | **FFO** | **$6,429** | **$0.23** | | Adjustments (Straight-line rent, etc.) | $1,800 | - | | **AFFO** | **$8,229** | **$0.30** | [Lease Revenues Detail](index=9&type=section&id=Lease%20Revenues%20Detail) Q1 2025 total rental revenues of **$16.2M** were primarily driven by **$16.7M** in contractual rental amounts, adjusted for lease amortization and straight-line rent recognition Breakdown of Rental Revenues (Q1 2025) | Component | Amount (in thousands) | | :--- | :--- | | Contractual rental amounts billed | $16,679 | | Straight-line rent adjustment | $122 | | Above/below market lease amortization, net | ($711) | | Other income & variable rent | $153 | | **Total rental revenues** | **$16,243** | [Capitalization and Debt Profile](index=10&type=section&id=Capitalization%20and%20Debt%20Profile) The company's capital structure as of March 31, 2025, demonstrates a balanced mix of debt and equity, with key leverage ratios indicating compliance with financial covenants and a stable debt maturity profile [Capital Structure](index=10&type=section&id=Capital%20Structure) As of March 31, 2025, FrontView's total capitalization was **$667.9M**, with debt at **46.7%** and equity at **53.3%**, resulting in an enterprise value of **$664.5M** Capital Structure as of March 31, 2025 | Component | Amount (in thousands) | % of Total Capitalization | | :--- | :--- | :--- | | Implied Equity Market Capitalization | $355,856 | 53.3% | | Total Debt | $312,000 | 46.7% | | **Total Capitalization** | **$667,856** | **100.0%** | | Enterprise Value | $664,547 | - | [Debt Outstanding & Equity Rollforward](index=11&type=section&id=Debt%20Outstanding%20%26%20Equity%20Rollforward) Gross debt increased to **$312.0M** as of March 31, 2025, primarily from increased Revolving Credit Facility borrowings, with both Term Loan and Revolver maturing in October 2027 Debt Outstanding (March 31, 2025) | Facility | Outstanding Balance | Interest Rate | Maturity Date | | :--- | :--- | :--- | :--- | | Term Loan | $200,000,000 | Adjusted SOFR + 1.20% | Oct 3, 2027 | | Revolving Credit Facility | $112,000,000 | Adjusted SOFR + 1.20% | Oct 3, 2027 | | **Gross Debt** | **$312,000,000** | | | - Both the Term Loan and Revolving Credit Facility have **two 12-month extension options** available[29](index=29&type=chunk) [EBITDA, EBITDAre, and Other Non-GAAP Operating Measures](index=12&type=section&id=EBITDA%2C%20EBITDAre%2C%20and%20Other%20Non-GAAP%20Operating%20Measures) Q1 2025 EBITDAre was **$11.7M**, with Adjusted EBITDAre at **$13.5M**, leading to an Annualized Adjusted EBITDAre of **$53.8M** EBITDAre Reconciliation (Q1 2025) | Metric | Amount (in thousands) | | :--- | :--- | | Net loss | ($1,337) | | EBITDA | $11,778 | | EBITDAre | $11,739 | | Adjusted EBITDAre | $13,458 | | **Annualized adjusted EBITDAre** | **$53,832** | [Net Debt Metrics & Covenants](index=13&type=section&id=Net%20Debt%20Metrics%20%26%20Covenants) Net Debt was **$308.7M** at Q1 2025, with Net Debt to Annualized Adjusted EBITDAre at **5.7x**, and the company confirmed compliance with all financial covenants Key Leverage Ratios (March 31, 2025) | Metric | Value | | :--- | :--- | | Net Debt | $308.7M | | Net Debt to Annualized EBITDAre | 6.6x | | Net Debt to Annualized Adjusted EBITDAre | 5.7x | - The company is **in compliance** with all key debt covenants, including a Total Leverage Ratio of **38.0%** against a required maximum of **60%**[36](index=36&type=chunk) [Portfolio Analysis](index=14&type=section&id=Portfolio%20Analysis) The company's portfolio exhibits strong diversification across tenants, industries, and geography, maintaining high occupancy and a well-staggered lease expiration schedule to mitigate rollover risk [Dispositions & Portfolio at a Glance: Key Metrics](index=14&type=section&id=Dispositions%20%26%20Portfolio%20at%20a%20Glance%3A%20Key%20Metrics) Q1 2025 saw one property disposition for **$2.05M**, with the portfolio reaching **323 properties**, **96.3% occupancy**, a **7.4-year** weighted average lease term, and **$62.1M** in annualized base rent Portfolio Key Metrics (March 31, 2025) | Metric | Value | | :--- | :--- | | Properties | 323 | | Occupancy | 96.3% | | Total Annualized Base Rent | $62.1M | | Weighted Average Remaining Lease Term | 7.4 Years | | Top 10 Tenant Concentration | 22.6% | - The company disposed of one occupied property during the first quarter for a **gain of $50,000** over its original purchase price[38](index=38&type=chunk) [Portfolio Diversification](index=15&type=section&id=Diversification) The portfolio exhibits strong diversification across tenants, industries, and geography, with no single tenant exceeding **3.1%** of ABR and balanced exposure across key sectors and states [Top 40 Tenants](index=15&type=section&id=Diversification%3A%20Top%2040%20Tenants) The tenant base is highly diversified, with **Dollar Tree** as the top tenant at **3.1%** of ABR, and the top 10 tenants collectively representing **22.6%** of ABR Top 5 Tenants by % of ABR | Tenant Brand | % of ABR | | :--- | :--- | | Dollar Tree | 3.1% | | Fast Pace Urgent Care | 2.8% | | Verizon | 2.7% | | Adams Auto Group | 2.3% | | Oak Street Health | 2.1% | [Tenant Industry](index=16&type=section&id=Diversification%3A%20Tenant%20Industry) The portfolio is diversified across **15 industries**, with leading concentrations in Medical and Dental Providers at **14.6%** and Quick Service Restaurants at **14.3%** of ABR Top 5 Industries by % of ABR | Industry | % of ABR | | :--- | :--- | | Medical and Dental Providers | 14.6% | | Quick Service Restaurants | 14.3% | | Casual Dining | 13.8% | | General Retail | 10.3% | | Financial Institutions | 9.4% | [Geography](index=19&type=section&id=Diversification%3A%20Geography) The **323 properties** are geographically dispersed across **37 U.S. states**, with Illinois, Texas, and Georgia as the top three states by ABR concentration Top 5 States by % of ABR | State | % of ABR | | :--- | :--- | | IL | 14.2% | | TX | 7.9% | | GA | 7.1% | | NC | 5.4% | | OH | 5.1% | [Lease Expirations](index=20&type=section&id=Lease%20Expirations) The company maintains a well-staggered lease expiration schedule, with only **1.6%** of ABR expiring in the remainder of 2025 and the largest single-year maturity at **11.0%** in 2027 - The lease maturity profile is **well-laddered**, with **no more than 11.0%** of ABR expiring in any single year through 2031[53](index=53&type=chunk) Lease Expiration Schedule (% of ABR) | Year | % of ABR Expiring | | :--- | :--- | | 2025 | 1.6% | | 2026 | 5.1% | | 2027 | 11.0% | | 2028 | 7.4% | | 2029 | 10.3% | | Thereafter | 64.6% | [Definitions and Explanations](index=21&type=section&id=Definitions%20and%20Explanations) This section provides essential definitions for key financial metrics and non-GAAP measures, including FFO, AFFO, EBITDA, and EBITDAre, used to assess the company's operating performance and financial health [Definitions](index=21&type=section&id=Definitions) This section defines key financial metrics and non-GAAP measures, including FFO, AFFO, EBITDA, and EBITDAre, used to assess the company's operating performance - FFO is calculated per **Nareit standards**, adjusting GAAP net income for items like real estate depreciation and gains/losses on property sales[56](index=56&type=chunk) - AFFO further adjusts FFO for certain non-cash or non-recurring items like straight-line rents, amortization of financing costs, and stock-based compensation to provide a clearer view of **normalized operating performance**[56](index=56&type=chunk) - EBITDAre is defined by **Nareit** as EBITDA excluding gains/losses from property sales and impairment charges. **Adjusted EBITDAre** includes further adjustments for investment/disposition timing and non-recurring expenses[55](index=55&type=chunk)

Group 1 - Outparcel REIT FrontView (NYSE: FVR) has experienced a 30% decline since its IPO in October 2024, underperforming compared to the broader REIT index (VNQ) and the overall market [1] - The company is currently facing challenges related to its tenants [1]

Portfolio Overview - As of December 31, 2024, FrontView owned a diversified portfolio of 307 properties across 35 U.S. states, with a total rentable area of approximately 2.4 million square feet[18][20]. - The portfolio's occupancy rate was 97.7%, with 320 tenants representing 150 different brands, and no single tenant brand accounting for more than 2.9% of the annual base rent (ABR)[20][25]. - Approximately 33.1% of tenants had an investment-grade credit rating, and 97.3% of leases had contractual rent escalations[20]. - The ABR weighted average remaining term of leases was approximately 7.2 years, with 96.1% of leases having renewal options[20][36]. - No single state exceeded 13.2% of the company's ABR, with Illinois representing the highest at 13.2%[20][33]. - Approximately 40.0% of the company's annualized base rent (ABR) comes from properties in its top five states: Illinois (13.2%), Texas (8.1%), Georgia (7.6%), North Carolina (5.7%), and Ohio (5.4%)[96]. - As of December 31, 2024, approximately 67% of the company's tenants had a credit rating below investment-grade or were unrated, as a percentage of its ABR[99]. - The top tenant brands included Fast Pace Urgent Care and Verizon, each accounting for 2.9% and 2.7% of ABR, respectively[26]. - The top 20 tenant brands accounted for approximately 37.0% of the company's ABR, with the largest tenant, Fast Pace Urgent Care, representing about 2.9% of the ABR[103]. - As of December 31, 2024, tenants in the restaurant industry represented approximately 30.6% of the company's ABR, indicating a significant exposure to this sector[101]. Financial Performance - For the year ended December 31, 2024, total rental revenues were $59.9 million, resulting in a net loss of $31.2 million and funds from operations (FFO) of $2.0 million[20]. - The company recorded net losses of approximately $31.2 million and $1.5 million for the years ended December 31, 2024 and 2023, respectively[81]. - The company incurred approximately $1.7 million in expenses not reimbursed or paid by tenants for the year ended December 31, 2024[40]. - The company incurred approximately $1.7 million in non-reimbursable expenses for the year ended December 31, 2024, which could impact financial stability if significant future expenses arise[110]. - The company expects to maintain its status as an emerging growth company until it reaches total annual gross revenue of $1.235 billion or more[68]. - The company anticipates that fluctuations in financial results could materially and adversely affect its operations and investor expectations[78]. - The company may not achieve the total returns expected from future acquisitions due to increasing costs of capital and lower capitalization rates[82]. - The company may face challenges in meeting required principal and interest payments due to insufficient cash flow[150]. - The company may not be able to make expected distributions due to insufficient cash flow or restrictions from debt agreements[211]. Debt and Financing - The company has a principal balance of approximately $266.5 million in outstanding indebtedness, which may expose it to default risks[75]. - The company’s debt consists of borrowings under its Revolving Credit Facility and Term Loan with a variable interest rate of Adjusted SOFR plus 1.2% and a maturity date of October 2027[149]. - The company has a $250 million Revolving Credit Facility and a $200 million Term Loan that bear interest at floating rates based on SOFR plus an applicable margin[163]. - The company may incur mortgage debt on properties, which increases the risk of foreclosure and loss of those properties[159]. - Disruptions in financial markets could limit the company's ability to obtain debt financing on commercially reasonable terms, impacting its investment strategy[158]. - The company believes it was in compliance with all financial and operational covenants related to its debt obligations as of December 31, 2024[161]. REIT Status and Tax Implications - The company intends to elect to be taxed as a REIT, requiring annual distribution of at least 90% of its REIT taxable income[58]. - The company must distribute at least 90% of its REIT taxable income each year to avoid entity-level taxes, and failure to do so could result in a 4% nondeductible excise tax[154]. - If the company fails to qualify as a REIT, it may face significant tax liabilities that would reduce cash available for distributions to stockholders[190]. - The company must ensure that at least 75% or 95% of its gross income is derived from qualifying sources, such as rents from real property[191]. - The company is subject to a 100% excise tax on certain non-arm's-length transactions with its TRSs, which could impact financial performance[199]. - Compliance with REIT requirements may restrict effective hedging and could lead to increased costs or tax liabilities[204]. Risks and Challenges - The company faces significant risks related to tenant defaults and vacancies, which could materially affect its revenue[74]. - The company may experience difficulties in renewing leases or re-leasing properties, particularly for specialty properties[75]. - The company faces cybersecurity risks, including potential data breaches and operational disruptions, which could materially affect its business[112]. - The integration of artificial intelligence tools presents risks such as inaccuracy and data privacy concerns, which could adversely impact the company's operations[113]. - The company faces significant risks associated with repositioning or construction of real estate projects, which may adversely affect returns on capital due to inaccurate projections and increased costs[116]. - Economic conditions affecting discretionary consumer spending could lead to tenant bankruptcies, adversely impacting the company's financial results[134]. - A decline in economic conditions may result in decreased demand for properties, affecting the company's ability to maintain and gain tenants[134]. - Increased interest rates may decrease the value of the company's properties, negatively impacting its financial condition[137]. - The company may face increased interest costs due to rising market interest rates, which could adversely affect its stock price and overall financial performance[155]. - The company may face conflicts of interest between stockholders and limited partners in the OP, which could impede beneficial business decisions[182]. Operational and Management Aspects - The company employs 15 full-time employees, focusing on various essential corporate activities[48]. - The company completed the Internalization, acquiring affiliates of North American Realty Services LLLP (NARS) and onboarding its entire senior management team[173]. - The company may incur unforeseen costs and difficulties associated with being self-managed, which could materially affect its operations[174]. - The company has entered into indemnification agreements with directors and executive officers, potentially limiting stockholder rights against them[179]. - The company’s investment and financing policies can be changed by the board of directors without stockholder approval, potentially increasing leverage and risk of default[177]. Environmental and Regulatory Risks - The company is subject to various environmental laws and regulations, which may impose liability for hazardous substance releases[59]. - The company has obtained environmental insurance policies to mitigate potential environmental risks on certain properties[63]. - Environmental liabilities associated with properties may lead to substantial costs for investigation and remediation, impacting financial performance[126]. - The presence of hazardous substances on properties could adversely affect the company's ability to sell, lease, or improve those properties[127]. - The company may incur additional expenses related to asbestos-containing materials in its properties, which could have a material adverse effect[130]. - Compliance with various laws and regulations may require unanticipated expenditures that could reduce investment returns for shareholders[145].

Financial Data and Key Metrics Changes - In Q4 2024, the company reported AFFO per share of $0.33, in line with guidance, while proforma AFFO per share would have been $0.27 assuming the repayment of fixed-rate notes at the beginning of the quarter [19][20] - The net debt ratio concluded the year at 5.2 times, indicating a prudent approach to leverage and a robust balance sheet [22] Business Line Data and Key Metrics Changes - In Q4 2024, the company acquired properties worth $103.4 million at an average cap rate of 7.93% with a weighted average lease term of 11 years [6] - The portfolio consisted of 307 freestanding properties with an average remaining lease term of over seven years, maintaining strong occupancy at approximately 98% [12] Market Data and Key Metrics Changes - The company is targeting strong credit tenants in essential services, health and wellness, while avoiding casual dining and pharmacy sectors [33] - The exposure to the sit-down fast casual space decreased from 19.3% of ABR at the end of Q3 2024 to approximately 15% at the end of Q4 2024 [16] Company Strategy and Development Direction - The company aims to acquire assets at above-market cap rates, with a planned investment activity of approximately $175 million to $200 million in 2025 [9][24] - The strategy includes addressing tenant health issues and repurposing or selling troubled assets to maximize long-term value for shareholders [13][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in acquiring properties at above-market cap rates despite slight tightening in the marketplace [7][8] - The company anticipates that the majority of properties currently on the watch list will come back online by late 2025 at meaningful recovery rates [15][40] Other Important Information - The company has secured a new $250 million revolving credit facility and a $200 million term loan at favorable terms, enhancing financial flexibility [23] - A quarterly dividend of $0.215 per share has been declared for the first quarter, balancing shareholder returns with reinvestment into growth [27] Q&A Session Summary Question: Can you discuss the acquisition pipeline and cap rate trends? - Management highlighted a robust acquisition pipeline with average cap rates in the high sevens, focusing on strong credit tenants in essential services while avoiding casual dining and pharmacy sectors [32][33] Question: What is the current tenant health and bad debt guidance? - Bad debt expectations are projected to be in the 2% to 3% range for the year, primarily related to tenants on the watch list, with expectations of returning to normalcy by the end of 2025 [39][40] Question: Can you provide details on the timing of asset recovery? - Management is currently in negotiations for 12 assets, expecting a significant portion of lost rent to come back online, with a conservative estimate pushing recovery into late 2025 [44][50] Question: How does the underwriting for new leases compare with the existing portfolio? - Rental increases for new leases remain consistent with historical rates of 1.5% to 2%, with a high percentage of corporate credits among new acquisitions [52][53] Question: Who are the primary sellers of properties currently? - The company is seeing motivated sellers primarily in the private investor market, with many individual sellers facing distress in other parts of their portfolios [56][59] Question: What is the company's approach to leverage and acquisitions? - Management indicated a willingness to maintain leverage around 6 times net debt to EBITDA, monitoring share price fluctuations to guide acquisition activity [63][66]

Financial Performance - For Q4 2024, the company reported revenues of $16.9 million, an increase from $15.5 million in Q4 2023, representing a year-over-year growth of approximately 8.8%[12] - The net loss for Q4 2024 was $22.0 million, compared to a net loss of $21.5 million in the previous quarter, indicating a slight increase in losses[12] - Funds From Operations (FFO) for Q4 2024 were reported at $(9.7) million, while Adjusted Funds From Operations (AFFO) were $7.4 million, showing a decline in FFO but a positive AFFO[12] - The company declared a dividend of $6.1 million for Q4 2024, with a dividend per diluted share of $0.215[12] - The company reported a net (loss) income of $(22,009) thousand for the three months ended December 31, 2024, compared to $(21,488) thousand in the previous quarter[16] - EBITDA for the quarter was $(8,846,000), a decrease from $(10,025,000) in the previous quarter and significantly lower than $23,283,000 in the same quarter last year[23] Assets and Liabilities - Total assets as of December 31, 2024, were $821.8 million, up from $733.1 million in the previous quarter, reflecting a growth of approximately 12.1%[12] - The total liabilities decreased to $299.1 million from $448.4 million in the previous quarter, indicating a significant reduction in debt levels[12] - Cash and cash equivalents stood at $5.1 million as of December 31, 2024, down from $9.9 million in the previous quarter[12] - The company reported a net cash provided by operating activities of $5.3 million for Q4 2024, compared to $7.6 million in Q3 2024[12] - Total liabilities decreased to $299,131,000 in December 2024 from $471,320,000 in December 2023, a reduction of 36.5%[14] - The company reported a net debt of $263,406,000 as of December 31, 2024, down from $409,571,000 in the previous quarter[26] Equity and Shareholder Value - FrontView REIT's total equity (book value) increased to $522.7 million as of December 31, 2024, compared to $284.7 million in the previous quarter, reflecting a substantial increase in shareholder value[12] - Total equity rose to $522,678,000 in December 2024 from $197,071,000 in December 2023, a significant increase of 164.5%[14] - The implied equity market capitalization was $504,431 thousand, accounting for 65.3% of total capitalization[19] - The equity balance as of December 31, 2024, included 17,291 thousand shares of common stock and 10,532 thousand OP units, totaling 27,823 thousand[22] Property Portfolio - As of December 31, 2024, FrontView REIT owned a diversified portfolio of 307 properties across 35 U.S. states, with total real estate held for investment at cost amounting to $719.4 million[12] - The portfolio expanded to 307 properties, an increase from 278 properties in the previous quarter[33] - The company has a total of 2,401,000 square feet across its properties, with General Retail occupying 20.9% of this space[38] - The largest tenant industry is Casual Dining, contributing 15.4% to ABR with 44 properties[38] - The company has 41 properties in Medical and Dental Providers, contributing 14.1% to ABR[38] Rental Income and Occupancy - Rental revenues for the three months ended December 31, 2024, were $16,868,000, up 8.7% from $15,514,000 in the previous quarter[15] - The company’s total annualized base rent increased to $58.8 million as of December 31, 2024, up from $52.1 million in the previous quarter[33] - The occupancy rate decreased to 97.7% from 98.9% in the previous quarter[33] - Contractual rental amounts billed increased to $14,547 thousand for the three months ended December 31, 2024, compared to $13,194 thousand in the previous quarter, reflecting a 10.2% growth[17] Expenses and Depreciation - Operating expenses increased to $13,735,000 in December 2024 from $12,784,000 in the previous quarter, reflecting a rise of 7.4%[15] - Accumulated depreciation increased to $40,398,000 in December 2024 from $28,734,000 in December 2023, indicating a growth of 40.7%[14] - Interest expense for the three months ended December 31, 2024, was $4,517,000, up from $3,593,000 in the previous quarter, an increase of 25.7%[15] Future Outlook - Lease expirations indicate that 11.7% of ABR ($6,875,000) is set to expire in 2027, affecting 382 square feet[45] - Future lease expirations show a gradual increase, with 7.5% of ABR ($4,386,000) expiring thereafter[45] - The weighted average remaining lease term increased to 7.2 years from 6.7 years in the previous quarter[33]

Group 1 - Many real estate companies have been negatively affected by the Federal Reserve's rate hikes over the past few years, leading to a decline in real estate stock prices and making many REITs less favorable [1] - The article highlights a shift in investment strategy, focusing on stocks with strong competitive advantages and effective management teams, indicating a potential for better performance in the current market environment [1] Group 2 - The current market conditions suggest a need for portfolio revision, with an aim to hold between 10 to 15 stocks along with a few broad ETFs, reflecting a strategic approach to investment diversification [1]

Financial Position - As of September 30, 2024, total assets amounted to $733,070,000, a decrease from $772,007,000 as of December 31, 2023, representing a decline of approximately 5.0%[16] - The company reported real estate held for investment at a cost of $640,264,000, down from $647,180,000, indicating a decrease of about 1.4%[16] - Cash and cash equivalents decreased to $9,895,000 from $17,129,000, reflecting a decline of approximately 42.5%[16] - Total liabilities decreased to $448,372,000 from $471,320,000, a reduction of about 4.9%[16] - Partners' capital as of September 30, 2024, was $180,974,000, down from $194,690,000 as of September 30, 2023[22] - The cash, cash equivalents, and restricted cash at the end of the period was $9,895,000, down from $15,173,000 at the end of the previous year[23] - The Partnership's total debt carrying amount was $419,466 as of September 30, 2024, with a fair value of $418,623[50] - The Partnership's net asset value (NAV) was $103,724, an increase from $103,616 at December 31, 2023, reflecting a growth of approximately 0.1%[83] IPO and Capital Raising - The company completed its IPO on October 2, 2024, selling 13,200,000 shares at $19.00 per share, generating net proceeds of $233,871,000 after underwriter fees[14] - An additional 1,090,846 shares were issued on October 23, 2024, from the underwriters' overallotment option, raising net proceeds of $19,327,064[14] - The Company sold 14,290,846 shares of Common Stock at an IPO price of $19.00 per share, raising approximately $271.5 million[98] - The company completed an initial public offering (IPO) with gross proceeds of $271,526,000, resulting in net proceeds of $251,198,000 after underwriting discounts and offering expenses[112] Revenue and Expenses - Rental revenues for the three months ended September 30, 2024, increased to $14,534,000, up 25.5% from $11,623,000 for the same period in 2023[18] - Total operating expenses for the three months ended September 30, 2024, decreased to $11,347,000, down 4.2% from $11,852,000 for the same period in 2023[18] - Interest expense for the three months ended September 30, 2024, rose to $6,463,000, an increase of 40.2% compared to $4,611,000 for the same period in 2023[18] - General and administrative expenses for the three months ended September 30, 2024, decreased significantly to $697,000, down 76.3% from $2,947,000 for the same period in 2023[18] - Rental revenues for the nine months ended September 30, 2024, were $43,690,000, a decrease of 1.6% from the historical predecessor[109] - Total operating expenses for the same period were $36,351,000, reflecting an increase of 7.4% compared to the historical predecessor[109] - Interest expense for the nine months ended September 30, 2024, was $13,007,000, reflecting a decrease of 34.3% from the previous period[109] Losses and Impairments - Net loss attributable to NADG NNN Property Fund LP for the three months ended September 30, 2024, was $(2,431,000), a decrease from $(3,561,000) for the same period in 2023[18] - Total operating loss for the nine months ended September 30, 2024, was $(9,721,000), compared to $(10,005,000) for the same period in 2023[18] - Net loss for the nine months ended September 30, 2024, was $(7,069,000), a slight improvement from $(7,254,000) for the same period in 2023[18] - The Partnership recorded an impairment loss of $591 on real estate held for investment with a remaining carrying value of $1,961 due to tenant vacancy during the nine months ended September 30, 2024[37] Real Estate Operations - The company is focused on investing in a geographically diversified portfolio of outparcel properties in prominent locations[9] - The Partnership owns 278 real estate properties, down from 284 properties as of December 31, 2023, with an average remaining lease term of approximately 7.0 years[55] - The Partnership sold five real estate properties for $10.773 million during the nine months ended September 30, 2024, resulting in net proceeds of $9.846 million after closing costs[56] - The estimated future minimum rents to be received under non-cancelable tenant leases total $400.490 million as of September 30, 2024[59] Debt and Financing - The weighted average interest rate for the Partnership's debt was 4.96% as of September 30, 2024[68] - The Partnership assumed a Term Loan of $17,000 with CIBC Bank USA, maturing on March 31, 2027, bearing interest at Term SOFR plus 1.80%[77] - Following the IPO, the Partnership repaid $150,000 thousand in outstanding borrowings and entered into a $200,000 thousand Delayed Draw Term Loan[92] - The anticipated repayment date for the Asset Backed Securities is December 2024, with a principal balance due if not paid in full[71] Internalization and Management - The company completed the internalization of external management functions, resulting in the issuance of 931,490 OP Units to NARS and affiliates, representing approximately 3.5% of the outstanding shares[96] - General and administrative expenses increased to $9,321,000, primarily due to additional costs associated with the internalization[109] - The preliminary purchase price allocation for the internalization transaction was valued at $17.7 million, which includes an intangible asset of $1.2 million[111] Future Outlook and Risks - The company expects to incur additional recurring general and administrative expenses as a result of becoming a public company, including employee compensation and benefits, board fees, and compliance-related expenses[117] - The company plans to manage interest rate risk through potential interest rate swaps or hedging arrangements[191]

Portfolio and Properties - As of September 30, 2024, FrontView REIT owned a diversified portfolio of 278 outparcel properties across 31 U.S. states[6] - The company has 278 properties across 31 U.S. states, with a total rentable square footage of 2.1 million[22] - The largest tenant, Verizon, accounts for 3.4% of Annual Base Rent (ABR) with 8.5 properties[23] - The Quick Service Restaurants sector represents 17.4% of ABR, with 62.5 properties[25] - The company operates in 15 different industries, with the highest concentration in Casual Dining at 19.3% of ABR[25] - Untenanted properties account for 0.0% of the total ABR, with 17 properties[29] Financial Performance - Revenues for Q3 2024 were $14.534 million, a slight decrease from $15.259 million in Q2 2024[8] - Funds From Operations (FFO) for Q3 2024 were $5.350 million, with FFO per share at $0.20[8] - Adjusted Funds From Operations (AFFO) for Q3 2024 were $6.221 million, with AFFO per share at $0.23[8] - Net loss for Q3 2024 was $(1.764) million, translating to a net loss per share of $(0.07)[8] - The company reported a net loss of $(1,764) million for the three months ended September 30, 2024, compared to a net loss of $(3,339) million for the same period in the previous year[17] - EBITDA for the three months ended September 30, 2024, was $10,105,000, down from $10,729,000 in the prior year[17] - The annualized adjusted EBITDAre is projected at $41,376,000 for the three months ended September 30, 2024[18] Assets and Liabilities - Total assets increased to $814.305 million from $733.070 million in the previous quarter[9] - Total liabilities decreased to $280.399 million from $448.372 million in the previous quarter[8] - Total liabilities increased to $471,320 million as of September 30, 2024, from $456,902 million in the previous quarter[10] - Total stockholders' equity as of September 30, 2024, was $197,071 million, an increase from $192,082 million in the previous quarter[10] - Total debt amounts to $253,499,000, which is 32.4% of total capitalization[14] - The company has a net debt of $160,238,000, with a net debt to annualized adjusted EBITDAre ratio of 3.9[18] - The total leverage ratio is reported at 30.9%, well below the required maximum of 60%[19] Cash and Financing - Cash and cash equivalents increased to $93.261 million from $9.895 million in the previous quarter[9] - The company has a new delayed draw term loan of $200,000,000 maturing on October 3, 2027[15] - The new revolving credit facility stands at $53,499,000, also maturing on October 3, 2027[15] Rental and Lease Information - Total Annualized Base Rent increased to $52.1 million from $52.0 million, representing a 0.2% growth[22] - Occupancy rate remained stable at 98.9%[22] - Investment Grade tenants decreased to 38.0% from 40.4%[22] - Weighted Average Annual Rent Increases were 1.7%[22] - The top 10 tenant concentration is 23.3%, while the top 20 tenant concentration is 38.5%[22] - The weighted average remaining lease term is 6.7 years, down from 7.0 years[22] - Lease expirations for 2027 amount to $7,158,000, which is 13.7% of the total[29] - The highest lease expiration percentage occurs in 2032 at 10.1%, with a total of $5,283,000[29] Dispositions and Market Outlook - Five properties were disposed of during 2024, with total sale proceeds of $10,773,000 against a purchase price of $10,302,000[20] - The company anticipates continued growth in its portfolio and revenue streams, despite potential market risks[5] Definitions and Metrics - Funds From Operations (FFO) and Adjusted Funds From Operations (AFFO) are non-GAAP measures widely accepted in the industry for comparing REIT performance[30] - Gross Debt is defined as total debt plus debt issuance costs and original issuance discount[30] - Net Debt is calculated as total debt less cash and cash equivalents and restricted cash[30] - Occupancy is measured as the number of properties under signed lease divided by the total number of properties in the portfolio[30] - The company emphasizes that EBITDA and EBITDAre are useful for investors as they provide insights into operating performance excluding certain non-cash costs[30]