Financial Data and Key Metrics Changes - The company achieved a 5.7% growth in AFFO for the year, which is among the best in the net lease industry, reflecting strong performance and record investment activity [4][14] - AFFO per share for Q4 was $1.27, a 5% increase year-over-year, while the full year AFFO totaled $4.97 per share [14] - The total return for shareholders was 25% for the year, placing the company in the top tier of publicly traded REITs [4] Business Line Data and Key Metrics Changes - The company allocated 68% of its investment volume to warehouse and industrial assets, with retail accounting for 22% [7] - The average cash cap rate for investments was 7.6%, translating into an average yield just above 9% over long-term leases averaging 17 years [6] - Contractual same-store rent growth averaged 2.4% for both Q4 and the full year, with CPI-linked rent escalations averaging 2.6% [15][16] Market Data and Key Metrics Changes - 26% of the investment volume was in Europe, while 74% was in North America, predominantly in the U.S. [7] - The company expects cap rates to trend lower in 2026, anticipating going-in cap rates in the mid- to low-7% range compared to 2025's average of 7.6% [11] Company Strategy and Development Direction - The company aims to expand its retail presence, targeting a mix of larger sale-leaseback opportunities and other retail categories [33] - The Carey Tenant Solutions platform is expected to enhance the company's capabilities in build-to-suit and redevelopment projects, with a goal to increase the volume of such projects [36][53] - The company plans to maintain a conservative investment volume guidance of $1.25 billion-$1.75 billion for 2026, with the potential to refine this as visibility improves [11][75] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining high investment activity and delivering attractive AFFO growth in 2026, supported by a strong funding position [9][30] - The company is mindful of potential credit losses, setting a conservative estimate for rent loss from tenant credit at $10 million-$15 million for 2026 [18][86] - Portfolio occupancy increased to 98% by year-end, with expectations to maintain this level through re-leasing and dispositions [18] Other Important Information - The company successfully refinanced its Euro-denominated term loan, locking in an attractive all-in rate below 3% [8] - The liquidity at year-end totaled $2.2 billion, providing ample flexibility for funding investment activities [29] - The quarterly dividend was increased by 4.5% year-over-year to $0.92 per share, supported by a payout ratio of approximately 73% [29] Q&A Session Summary Question: Expansion strategy in U.S. retail - Management indicated that retail accounted for about 22% of deal volume in 2025, with plans to increase this to 25%-30% in the future, focusing on tenant credit and lease structure [33][34] Question: Growth of Carey Tenant Solutions platform - Management noted that they completed about $50 million in projects year-to-date, with another $280 million in construction planned over the next 12-18 months [36] Question: Industrial asset cap rates and competition - Management stated that industrial assets remain a core part of the business, with expectations for cap rates to tighten slightly in 2026 [41][42] Question: Credit loss estimates - Management clarified that the $10 million-$15 million range for credit loss is a conservative estimate with no specific concerns currently in the portfolio [86] Question: Debt refinancing plans - Management confirmed plans to refinance upcoming bond maturities with unsecured debt in the same currencies, with current pricing expectations in the low 4% range for Eurobonds [87][88]

Financial Data and Key Metrics Changes - The company achieved a 5.7% growth in AFFO for 2025, which is among the best in the net lease industry, reflecting strong performance and record investment activity [3][12] - AFFO per share for Q4 was $1.27, a 5% increase year-over-year, while the full year AFFO totaled $4.97 per share [12][14] - The total return for shareholders was 25% for the year, placing the company in the top tier of publicly traded REITs [3] Business Line Data and Key Metrics Changes - The company allocated 68% of its investment volume to warehouse and industrial sectors, with retail accounting for 22% [6] - The average cash cap rate for investments was 7.6%, translating into an average yield just above 9% over long-term leases averaging 17 years [5][12] - Contractual same-store rent growth averaged 2.4% for both Q4 and the full year, with CPI-linked rent escalations averaging 2.6% [14][15] Market Data and Key Metrics Changes - 26% of the investment volume was in Europe, while 74% was in North America, predominantly in the U.S. [6] - The company expects cap rates to be incrementally lower in 2026, anticipating going-in cap rates in the mid- to low-7% range [10][41] Company Strategy and Development Direction - The company aims to continue generating higher investment volumes, with an initial investment volume guidance range of $1.25 billion to $1.75 billion for 2026 [10][19] - The Carey Tenant Solutions platform is expected to enhance the company's capabilities in build-to-suit and redevelopment projects, with a focus on increasing the volume of such projects [9][52] - The company is targeting to increase retail investments to 25%-30% of annual deal volume, focusing on tenant credit and lease structure [33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining high levels of investment activity and delivering attractive AFFO growth in 2026, supported by strong funding positions and a sizable investment pipeline [8][29] - The company is taking a conservative approach to rent loss estimates, projecting $10-$15 million for 2026, while not seeing any material changes in credit quality across the portfolio [17][87] - The company anticipates portfolio occupancy to remain over 98% through a combination of releasing and dispositions [17] Other Important Information - The company successfully refinanced its euro-denominated term loan, locking in an attractive all-in rate below 3% [7] - The company ended the year with liquidity totaling $2.2 billion, including cash on hand and unsettled forward equity [27] - The quarterly dividend was increased by 4.5% year-over-year to $0.92 per share, supported by a payout ratio of approximately 73% [27] Q&A Session Summary Question: Expansion in U.S. retail and targeted categories - Management confirmed that retail accounted for about 22% of deal volume in 2025, with plans to increase this to 25%-30% [33] Question: Industrial asset types and competition - Management indicated that industrial remains a core part of the business, focusing on manufacturing and logistics, with expectations of cap rate tightening [40][41] Question: Development risks associated with Carey Tenant Solutions - Management explained that development risks are mitigated through fixed-price contracts and guaranteed rent start dates [52][53] Question: Credit loss estimates and portfolio management - Management stated that the $10-$15 million range for credit loss is a conservative estimate with no specific concerns in the portfolio at the moment [87] Question: Debt refinancing and overall debt composition - Management confirmed that they have flexibility in refinancing upcoming bonds and will likely replace them with unsecured debt in the same currencies [88][93]

Core Viewpoint - Agree Realty (ADC) has significant capacity for growth but is currently not utilizing it fully, raising questions about management's strategy and market conditions. Financial Metrics - Pro forma net debt-to-recurring EBITDA stands at 3.5x, which includes unsettled forward equity offerings; excluding these, the figure is 5.1x, still within investment-grade net lease REIT standards [2] - AFFO payout ratio is approximately 70%, indicating that ADC retains more internal capital compared to peers with payout ratios in the mid-70s to low-80s [3][4] Earnings Performance - AFFO per share for Q3 2025 was $1.10, reflecting a year-over-year increase of 7.2%; full-year 2025 guidance has been raised to $4.31–$4.33, suggesting a growth of 4.4% at the midpoint [4] - ADC deployed $1.55 billion in 2025, but the 2026 investment guidance is lower at $1.25–$1.50 billion, indicating a potential pullback in investment activity [6][7] Credit Ratings - Fitch assigned ADC an A- issuer rating with a stable outlook, citing superior tenant credit quality and sector-leading access to capital; Moody's rates it Baa1, and S&P Global Ratings upgraded it to BBB+ [5][6] Tenant Quality - Approximately 66.8% of ADC's annualized base rent comes from investment-grade tenants, with a potential shift in this percentage serving as an indicator of underwriting philosophy [11] Future Indicators - Key signals to watch for changes in management behavior include 2026 AFFO guidance relative to consensus, ex-forward leverage compression, and shifts in the investment-grade tenant mix [8][9][10]

Financial Data and Key Metrics Changes - For Q3 2025, the company recorded revenue of $121 million and a net loss attributable to common stockholders of $71.1 million, with AFFO at $53.2 million or $0.24 per share [14] - The gross outstanding debt balance was $3 billion at the end of Q3 2025, a reduction of $2 billion from Q3 2024 [14][18] - The weighted average interest rate decreased to 4.2% from 4.8% in Q3 2024, and the interest coverage ratio was 2.9 times [15] Business Line Data and Key Metrics Changes - The company has sold approximately $3 billion of non-core assets since implementing its disposition program, achieving a 7.7% cash cap rate on these sales [5][6] - The portfolio's occupancy rate stood at 97% with a weighted average remaining lease term of 6.2 years, featuring a stable tenant base with 60% of tenants rated investment-grade [9] Market Data and Key Metrics Changes - The company noted that the Federal Reserve's recent rate cuts could lower the cost of capital, positively impacting GNL's financial position [8] - The company has observed that dividend income from REITs becomes more attractive in a rate-cutting environment, potentially benefiting the net lease REIT industry [9] Company Strategy and Development Direction - The company aims to continue its strategic initiatives, including share repurchases and potential acquisitions, while maintaining financial strength and flexibility [8][19] - The strategic focus has been on reducing leverage and improving portfolio quality, culminating in an investment-grade corporate credit rating from Fitch Ratings [4][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the midpoint of their leverage guidance by year-end, citing ongoing disposition activities [26] - The company plans to continue evaluating acquisition opportunities but remains cautious due to current market conditions and high seller expectations [19][24] Other Important Information - The company has repurchased 12.1 million shares at a weighted average price of $7.59, totaling $91.7 million, with an AFFO yield of approximately 12% [7][16] - The company has a liquidity of approximately $1.1 billion and $1.2 billion of capacity on its revolving credit facility [16] Q&A Session Summary Question: What needs to happen for the company to become an active buyer again? - The company would need to finish its disposition program and see a better alignment between seller cap rate expectations and cost of capital [23][24] Question: How does the company plan to achieve the midpoint of its leverage guidance by year-end? - Management is confident that completing scheduled dispositions will help them stay within their leverage guidance range [26][27] Question: What drove the slight decline in occupancy quarter over quarter? - The decline was due to a tenant expiration in the U.K. portfolio, but management expects to recover occupancy through new leasing efforts [36] Question: How does the company view its strategy and playbook going into 2026? - The company is open to acquisitions but emphasizes that it will not pursue growth for the sake of growth, focusing instead on maximizing shareholder value [39][40] Question: How achievable is the renewal leasing spread of 26.4% going forward? - The company has seen strong renewal spreads and engages with tenants well in advance of lease expirations to secure favorable terms [44][46]

Core Insights - Net lease REITs have gained renewed attention in recent months, particularly in the context of capitalization rates within the sector [1] Group 1: Industry Focus - The net lease sector has been a focal point for analysis, with discussions centered around capitalization rates [1]

Core Insights - Net lease REITs have gained renewed attention in recent months, particularly in the context of capitalization rates within the sector [1] Group 1: Industry Focus - The net lease sector has been a focal point for analysis, with discussions centered around capitalization rates [1]

Core Insights - Getty Realty Corp. reported a strong third quarter performance, reflecting effective execution of its investment strategy and stable rental income from convenience and automotive retail tenants [4][2] - The company has increased its earnings guidance for the full year 2025, indicating confidence in continued growth and value creation for shareholders [4][24] Financial Performance - For the three months ended September 30, 2025, net earnings were $23.3 million, or $0.40 per share, compared to $15.3 million, or $0.27 per share for the same period in 2024, representing a 52.5% increase in net earnings [6][41] - Funds From Operations (FFO) for the third quarter were $38.7 million, or $0.66 per share, up from $31.4 million, or $0.56 per share in the prior year [6][41] - Adjusted Funds From Operations (AFFO) increased to $36.1 million, or $0.62 per share, compared to $33.2 million, or $0.59 per share in the same quarter of 2024 [6][41] Revenue and Income - Rental income for the third quarter was $53.5 million, an increase of 12.3% from $47.6 million in the same quarter of 2024 [7][9] - Total revenues for the quarter reached $55.6 million, compared to $51.5 million in the prior year, marking a 7.9% increase [41] Investment Activity - Year-to-date, the company has completed $237 million in investment activity, with an initial cash yield of 7.9% [4][16] - The company has a committed investment pipeline exceeding $75 million for the development and acquisition of 22 properties, expected to be funded over the next 9-12 months [17][4] Portfolio and Property Management - As of September 30, 2025, Getty Realty's portfolio included 1,160 properties across 44 states and Washington, D.C. [29] - The company sold one property for $1.8 million during the quarter, with a gain of $0.3 million, and six properties for $5.5 million year-to-date, recording a total gain of $2.2 million [19][20] Balance Sheet and Capital Markets - As of September 30, 2025, total outstanding indebtedness was $940 million, with $750 million in senior unsecured notes at a weighted average interest rate of 4.1% [20][21] - The company raised approximately $32.5 million from the settlement of 1.2 million shares of common stock during the quarter [22][23] Guidance - The company has raised its 2025 AFFO guidance to a range of $2.42 to $2.43 per diluted share, up from the previous range of $2.40 to $2.41 [24]

Core Insights - Agree Realty (ADC) is recognized as the highest quality name in net lease REIT coverage due to its strategic capital allocation and careful underwriting practices [1] - The investment strategy emphasizes finding undervalued companies with strong balance sheets and management teams in sectors with long-term growth potential [1] Group 1 - The company has established its reputation through intentional efforts in capital allocation and underwriting [1] - The leader of the investing group Best Of Breed Growth Stocks focuses on stocks with a high probability of delivering significant alpha compared to the S&P 500 [1] - The investment approach combines growth-oriented principles with strict valuation hurdles to enhance the margin of safety [1] Group 2 - Features of the investment group include exclusive access to high-conviction stock picks, comprehensive research reports, real-time trade alerts, macro market analysis, and a community chat for continuous engagement [1] - The analyst's strategy involves identifying companies with secular growth that appreciate over time [1]

Core Viewpoint - The S&P 500 index is near all-time highs with a yield of approximately 1.3%, making it challenging for dividend investors to find high-yield stocks. However, W.P. Carey, with a yield of 5.8%, presents an attractive opportunity for those willing to invest when others are selling [1]. Company Overview - W.P. Carey is a net lease real estate investment trust (REIT) that primarily owns single-tenant properties, where tenants are responsible for most property-level expenses. It ranks second in the net lease REIT sector with a market cap of $13 billion, following Realty Income at $50 billion and ahead of NNN REIT at $8 billion [2]. - Net lease REITs are generally considered stable income stocks, with their business driven by sale/leaseback deals. However, higher interest rates have negatively impacted their profitability and ability to secure new deals, leading to a decline in W.P. Carey's stock, which is down about 30% from its 2019 highs [4]. Dividend Performance - W.P. Carey cut its dividend in 2023, while its peers, NNN REIT and Realty Income, have consistently increased their dividends for 36 and 30 years, respectively. Despite the cut, W.P. Carey has resumed increasing its dividend quarterly since then, indicating a recovery [5][7]. - The company’s focus has shifted away from the troubled office sector to more lucrative industrial, warehouse, and retail properties, which has improved its portfolio [7][8]. Growth Potential - The exit from the office sector has provided W.P. Carey with cash to invest in new properties, which is expected to enhance growth in the coming years. The company’s last dividend increase was over 3% year-over-year, compared to Realty Income's 0.2% increase [9][10]. - W.P. Carey incorporates inflation-linked rent escalators in its leases, which supports growth and differentiates it from peers that are less aggressive in this regard [10]. Investment Consideration - Investors often overlook W.P. Carey in favor of Realty Income or NNN REIT, but the company’s strong dividend growth history and differentiated property focus on industrial and warehouse assets make it a compelling addition to a net lease portfolio [11][12].

Financial Data and Key Metrics Changes - For Q1 2025, the company recorded revenue of $132.4 million and a net loss attributable to common stockholders of $200.3 million, which is expected to improve significantly upon closing the remainder of the multi-tenant portfolio sale [19][20] - The gross outstanding debt balance was $3.9 billion at the end of Q1 2025, down by $1.3 billion from the end of Q1 2024 [20] - The net debt to adjusted EBITDA ratio was 6.7 times at the end of Q1 2025, improved from 8.4 times at the end of Q1 2024 [21] Business Line Data and Key Metrics Changes - The company achieved a milestone with the signing of a definitive agreement for the sale of its multi-tenant portfolio, generating $1.1 billion in gross proceeds from the first phase, which included 59 unencumbered properties [8] - The portfolio's occupancy stood at 95% at the end of Q1 2025, with a weighted average remaining lease term of 6.3 years [12] - Following the departure of Contractor Steel, the company sold five vacant properties for a combined $60 million, which helped minimize vacancy downtime [13] Market Data and Key Metrics Changes - Geographically, 76% of straight-line rent is earned in North America and 24% in Europe, providing diversification across economic cycles [15] - The portfolio features a stable tenant base, with 60% of tenants receiving an investment grade or implied investment grade rating [15] Company Strategy and Development Direction - The company is focused on reducing leverage and enhancing financial flexibility, with a goal of achieving an investment grade credit rating [5][9] - A $300 million share repurchase program was approved, with 7.9 million shares repurchased at a weighted average price of $7.5, reflecting a strategic approach to capitalize on undervalued stock [11] - The company is strategically scaling back its exposure to the gas and convenience store sector, reallocating capital toward higher growth sectors [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market volatility and highlighted the importance of a strong balance sheet for future growth [5][24] - The company reaffirmed its AFFO per share guidance range of $0.90 to $0.96 for 2025, indicating a positive outlook despite current market conditions [23] Other Important Information - The company has a closed plus disposition pipeline totaling $2.1 billion, with total asset sales expected to reach nearly $3 billion by the end of 2025 [9][10] - The weighted average interest rate on debt stood at 4.4%, with an interest coverage ratio of 2.5 times [20] Q&A Session Summary Question: Can you break down the remaining $300 million in the disposition pipeline by sector or geography? - Management indicated that the remaining pipeline consists of non-core dispositions identified since the end of 2024, continuing the deleveraging strategy [29][30] Question: How will market volatility impact asset sales and pricing? - Management believes there will still be opportunities to sell assets, leveraging relationships with local brokers to navigate the market [31][32] Question: Is the 12% AFFO yield the hurdle rate for future buybacks? - Management expressed satisfaction with the current buyback execution and indicated that they will continue to monitor AFFO accretion for future buybacks [33][34] Question: What is the capital allocation strategy regarding share buybacks versus debt repayment? - Management emphasized a focus on reducing leverage and opportunistic share buybacks, while also maintaining a disciplined approach to capital allocation [40][41] Question: Can you share insights on credit rating upgrades and potential savings? - Management noted that conversations with credit agencies are confidential but acknowledged the positive credit watch status and the long-term goal of accessing investment grade debt opportunities [46][47] Question: What types of dispositions are being targeted moving forward? - Management mentioned looking at retail opportunities and continuing to evaluate the portfolio for potential sales, particularly in the gas and convenience store sector [49][50] Question: Did Contractor Steel pay any rent in Q1? - Management confirmed that Contractor Steel did not pay any rent in Q1 [78] Question: How should investors think about the run rate for AFFO in the back half of the year? - Management explained that the income statement already accounts for discontinued operations related to the multi-tenant portfolio, and they expect a decrease in G&A expenses due to the sale [82] Question: Are there more vacant assets available for future proceeds? - Management indicated that after the completion of the multi-tenant sale, the portfolio would be nearly 98% occupied, suggesting limited future vacant asset sales [86]