Broadstone(US:BNL)2023-08-02 16:00Portfolio Overview - As of June 30, 2023, the company’s portfolio includes 801 properties, with an annualized base rent (ABR) of approximately $15,605,000 from the top tenant, Roskam Baking Company, accounting for 4.0% of the total portfolio[125] - The portfolio is approximately 99.4% leased, with an ABR weighted average remaining lease term of approximately 10.7 years, excluding renewal options[125] - The properties are located in 44 U.S. states and four Canadian provinces, with no single geographic concentration exceeding 9.8% of the ABR[125] - The portfolio comprises approximately 38.5 million rentable square feet of operational space[125] - Total ABR (Annual Base Rent) for the portfolio is $390.974 million, with healthcare facilities contributing 13.9% and restaurants 13.7%[130] Tenant and Lease Information - Approximately 97.3% of leases have contractual rent escalations, with an ABR weighted average minimum increase of 2.0%[125] - Approximately 94.2% of tenants provide financial reporting, with 86.3% required to provide specified financial information periodically[125] - The top 10 tenants contribute 19.4% of the total ABR, with a total of 170 properties leased to these tenants[128] - The total ABR from the top 20 tenants is $124,560,000, representing 32.1% of the total portfolio[128] - Master leases contributed to 69.3% of the ABR associated with multi-site tenants and 41.5% of overall ABR as of June 30, 2023[133] - As of June 30, 2023, the company had 801 properties in its portfolio, with 408 properties under master lease structures[133] Financial Performance - The company recognized a decrease in lease revenues of $7.5 million due to lease termination income in Q1 2023 compared to no income in Q2 2023[137] - Gain on sale of real estate was $29.462 million for the three months ended June 30, 2023, compared to $3.415 million in the previous quarter, representing an increase of over 100%[139] - The company sold one property with a carrying value of approximately $37.0 million for total proceeds of $47.0 million, resulting in a gain on sale of approximately $9.3 million[145] - Interest expense decreased by 4.1% from $21.139 million in Q1 2023 to $20.277 million in Q2 2023[139] Debt and Financing - The company maintains a $1.0 billion unsecured revolving credit facility, dated January 28, 2022[124] - Fixed-rate debt had a carrying value of approximately $1.9 billion and a fair value of $1.7 billion as of June 30, 2023[251] - Total borrowings under the Revolving Credit Facility and other variable-rate debt amounted to $1.0 billion as of June 30, 2023, with $975.4 million swapped to a fixed rate[251] - A 1% increase in market interest rates would decrease the fair value of fixed-rate debt by approximately $68.0 million[251] - A 1% change in interest rates would result in a corresponding $0.5 million increase or decrease in annual interest expense[251] Risk Management - The company is exposed to foreign currency exchange rate risk due to investments in Canada, funded significantly through Canadian dollar borrowings[251] - Unrealized foreign currency gains and losses from Canadian dollar borrowings do not impact cash flows from operations until settled[251] - The foreign currency exchange rate risk on remaining cash flows is considered immaterial by the company[251] Corporate Governance - There have been no changes in internal control over financial reporting that materially affected the company during the quarter ended June 30, 2023[253] Future Commitments - The company has a remaining commitment of $167.3 million for a build-to-suit transaction expected to fund through October 2024[143] - A quarterly distribution of $0.28 per share was declared for Q3 2023, payable on or before October 13, 2023[145] Disposition Strategy - The company disposed of properties with credit risk or lease rollover risk at advantageous pricing relative to redeployment yields[137]