Higher AFFO outlook as NNN REIT (NYSE: NNN) posts solid Q1 2026
Rhea-AI Filing Summary
NNN REIT, Inc. reported first quarter 2026 revenue of $240.4 million and net earnings of $93.9 million, or $0.50 per diluted share. Funds from operations were $0.86 per share, and adjusted funds from operations were $0.87 per share, matching the prior-year quarter.
The portfolio remained strong with 98.6% occupancy, 3,711 properties and a 10.1-year weighted average lease term. During the quarter the company invested $145.4 million in 41 properties at a 7.5% initial cash cap rate and sold 25 properties for $35.8 million. NNN fully drew its $300 million term loan, hedged at a fixed rate of 4.10%, and ended the quarter with $1.2 billion of total liquidity. The quarterly dividend was $0.60 per share, a 69% AFFO payout ratio, and 2026 guidance for AFFO per share was raised to $3.53–$3.59 with Core FFO per share updated to $3.48–$3.54.
Positive
- None.
Negative
- None.
Insights
NNN posts steady Q1 2026 results, nudges AFFO outlook higher.
NNN REIT, Inc. delivered modest top-line growth with revenues of $240.4M versus $230.9M a year earlier, while net earnings dipped slightly to $94.0M. Cash flow metrics held firm: FFO per share was $0.86 and AFFO per share was $0.87, unchanged year over year.
Operationally, the portfolio remained healthy. Occupancy improved to 98.6%, above the prior quarter and prior year, and the average remaining lease term was 10.1 years. The company invested $145.4M at a 7.5% cap rate and recycled $35.8M of assets, indicating ongoing capital deployment and pruning.
The balance sheet showed $4.9B of Gross Debt at a 4.2% weighted average rate, with a long 10.5-year debt maturity profile and Net Debt to annualized EBITDAre of 5.7x. Updated 2026 guidance slightly raised AFFO and Core FFO per share ranges, suggesting expectations for stable to modestly improving cash generation under current assumptions.
8-K Event Classification
Key Figures
Key Terms
Adjusted Funds From Operations (AFFO) financial
Funds From Operations (FFO) financial
Core Funds From Operations (Core FFO) financial
EBITDAre financial
Annualized Base Rent (ABR) financial
Net Debt financial
Earnings Snapshot
2026 AFFO per share raised to $3.53–$3.59; Core FFO per share to $3.48–$3.54; net earnings per share excluding specified items maintained at $2.02–$2.08.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(exact name of registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization) |
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(Commission File Number) |
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(I.R.S. Employer Identification No.) |
(Address of principal executive offices, including zip code)
(
(Registrant’s telephone number, including area code)
Not applicable
(Former name or former address if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of exchange on which registered |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. |
Results of Operations and Financial Condition. |
On April 30, 2026, NNN REIT, Inc. (the "Company") issued a press release announcing its results of operations and financial condition for the quarter ended March 31, 2026. The press release is attached hereto as Exhibit 99.1. The press release is available on the Company's website.
The information in this Form 8-K is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), as amended, or otherwise subject to the liabilities of such section, nor shall such information be deemed to be incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01. |
Financial Statements and Exhibits. |
(d) Exhibits.
99.1 |
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Press Release, dated April 30, 2026, of NNN REIT, Inc. |
104.1 |
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Cover Page Interactive Data File (the Cover Page Interactive Data File is embedded within the Inline XBRL document) |
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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NNN REIT, Inc. |
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Dated: April 30, 2026 |
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By: |
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/s/ Vincent H. Chao |
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Vincent H. Chao |
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Executive Vice President and Chief Financial Officer |
Exhibit 99.1
NEWS RELEASE
For information contact:
Vincent H. Chao
Chief Financial Officer
(407) 265-7348 |
FOR IMMEDIATE RELEASE |
April 30, 2026
NNN REIT, Inc. Announces First Quarter 2026 Results and Increases 2026 Guidance
Orlando, Florida, April 30, 2026 – NNN REIT, Inc. (NYSE: NNN) (the "Company" or "NNN"), a real estate investment trust, today announced financial and operating results for the quarter ended March 31, 2026. Highlights include:
First Quarter 2026 Highlights:
Additional Highlights:
Steve Horn, Chief Executive Officer, commented: "We are pleased with our solid start to the year. Our strong first quarter performance enabled us to increase AFFO guidance for 2026. Portfolio occupancy climbed to 98.6%, surpassing our long-term average, and our balance sheet remains well positioned to fund future acquisitions. NNN’s primarily self-funded model in the triple-net market, combined with our robust tenant relationship program, positions us to deliver consistent and sustainable per-share growth year after year."
1
FINANCIAL RESULTS
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Quarter Ended March 31, |
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(dollars in thousands, except per diluted share data) |
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2026 |
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2025 |
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Revenues |
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$ |
240,424 |
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$ |
230,854 |
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Net earnings |
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$ |
93,951 |
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$ |
96,458 |
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Net earnings per share |
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$ |
0.50 |
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$ |
0.51 |
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FFO |
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$ |
163,150 |
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$ |
158,734 |
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FFO per share |
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$ |
0.86 |
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$ |
0.85 |
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Core FFO |
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$ |
163,584 |
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$ |
160,907 |
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Core FFO per share |
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$ |
0.86 |
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$ |
0.86 |
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AFFO |
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$ |
165,679 |
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$ |
163,015 |
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AFFO per share |
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$ |
0.87 |
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$ |
0.87 |
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PORTFOLIO SNAPSHOT
(dollars in thousands) |
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March 31, |
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December 31, 2025 |
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March 31, |
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Number of properties |
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3,711 |
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3,692 |
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3,641 |
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Total gross leasable area (square feet) |
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39,597,000 |
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39,578,000 |
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37,311,000 |
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Occupancy rate |
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98.6 |
% |
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98.3 |
% |
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97.7 |
% |
Weighted average remaining lease term (years) |
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10.1 |
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10.2 |
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9.9 |
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ABR |
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$ |
934,612 |
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$ |
928,081 |
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$ |
874,301 |
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PROPERTY ACQUISITIONS
(dollars in thousands) |
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Quarter Ended March 31, 2026 |
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Total dollars invested(1) |
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$ |
145,394 |
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Number of properties |
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41 |
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Gross leasable area (square feet)(2) |
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304,000 |
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Weighted average cap rate(3) |
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7.5 |
% |
Weighted average lease term (years) |
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19.0 |
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(1) |
Includes dollars invested in projects under construction or tenant improvements. |
(2) |
Includes additional square footage from completed construction on existing properties. |
(3) |
Calculated as the initial cash annual base rent divided by the total purchase price of the properties. |
PROPERTY DISPOSITIONS
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Quarter Ended March 31, 2026 |
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(dollars in thousands) |
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Occupied |
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Vacant |
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Total |
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Number of properties |
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9 |
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16 |
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25 |
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Gross leasable area (square feet) |
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90,000 |
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156,000 |
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246,000 |
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Net sale proceeds |
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$ |
17,800 |
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$ |
18,027 |
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$ |
35,827 |
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Weighted average cap rate(1) |
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7.2 |
% |
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— |
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7.2 |
% |
(1) |
Calculated as the cash annual base rent divided by the total gross proceeds received for the occupied properties. |
2
CAPITAL MARKETS ACTIVITY
During the quarter ended March 31, 2026, NNN drew down the entire $300 million on the Term Loan. The Company previously entered into forward starting swaps with a total notional value of $300 million that fix the Secured Overnight Financing Rate (“SOFR”) at 3.25% and fully hedge the outstanding balance on the Term Loan at an all-in fixed rate of 4.10%.
During the quarter ended March 31, 2026, NNN sold 1,667,232 common shares pursuant to forward sale agreements under the Company’s ATM at a weighted average price per share of $44.93.
As of March 31, 2026, NNN had 1,667,232 shares of common stock subject to outstanding forward sale agreements, which upon settlement, are anticipated to raise net proceeds of approximately $74.0 million. Net proceeds include the impact of forward price adjustments through March 31, 2026.
BALANCE SHEET AND LIQUIDITY
As of March 31, 2026, Gross Debt was $4.9 billion with a weighted average interest rate of 4.2% and a weighted average debt maturity of 10.5 years. The Company ended the quarter with $1.2 billion of total available liquidity, including $1.1 billion of unused line of credit capacity, $74.0 million of outstanding forward equity, and $5.4 million of cash and restricted cash. Net Debt to annualized EBITDAre and fixed charge coverage was 5.7x and 4.1x, respectively, as of March 31, 2026. Including the impact of unsettled forward equity, Pro Forma Net Debt to annualized EBITDAre was 5.6x as of March 31, 2026.
DIVIDEND
As previously announced on April 15, 2026, the Company’s Board of Directors declared a quarterly dividend of $0.60 per share payable on May 15, 2026, to shareholders of record as of April 30, 2026. The quarterly dividend represents an annualized dividend of $2.40 per share and an annualized dividend yield of 5.7% as of March 31, 2026.
2026 GUIDANCE
(dollars in millions, except per diluted share data) |
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Initial 2026 Guidance |
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Updated 2026 Guidance |
Net earnings per share excluding any gains on disposition of real estate, |
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$2.02 - $2.08 |
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$2.02 - $2.08 |
Real estate depreciation and amortization per share |
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$1.45 |
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$1.46 |
Core FFO per share |
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$3.47 - $3.53 |
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$3.48 - $3.54 |
AFFO per share |
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$3.52 - $3.58 |
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$3.53 - $3.59 |
General and administrative expenses |
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$53 - $55 |
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$53 - $55 |
Real estate expenses, net of tenant reimbursements |
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$14 - $15 |
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$14 - $15 |
Acquisition volume |
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$550 - $650 |
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$550 - $650 |
Disposition volume |
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$110 - $150 |
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$110 - $150 |
Guidance is based on current plans and assumptions and is subject to risks and uncertainties more fully described in this press release and the Company's reports filed with the Securities and Exchange Commission (the "Commission").
CONFERENCE CALL INFORMATION
The Company will host a conference call on April 30, 2026 at 10:30 a.m. ET to discuss first quarter results. A live webcast of the conference call will be available on the Company's website at www.nnnreit.com or by using the following link. The conference call can also be accessed by dialing 888-506-0062 in the United States (“U.S.”) or 973-528-0011 for international callers and entering the participant code 188942 or referencing NNN REIT, Inc.
A telephonic replay of the call will be available through Thursday, May 14, 2026, by dialing 877-481-4010 in the U.S. or 919-882-2331 internationally and entering the code 53800.
3
ABOUT NNN REIT, INC.
NNN invests in high-quality properties subject generally to long-term, net leases with minimal ongoing capital expenditures. As of March 31, 2026, the Company owned 3,711 properties in all 50 states, the District of Columbia and Puerto Rico, with a gross leasable area of approximately 39.6 million square feet and a weighted average remaining lease term of 10.1 years. NNN is one of only three publicly traded real estate investment trusts to have increased annual dividends for 36 or more consecutive years. For more information on the Company, visit www.nnnreit.com.
FORWARD-LOOKING STATEMENTS
Statements in this press release that are not strictly historical are “forward-looking” statements. These statements generally are characterized by the use of terms such as "believe," "expect," "intend," "may," "estimated" or other similar words or expressions. Forward-looking statements involve known and unknown risks, which may cause the Company’s actual future results to differ materially from expected results. These risks include, among others, general economic conditions, including inflation, local real estate conditions, changes in interest rates, increases in operating costs, the preferences and financial condition of the Company's tenants, the availability of capital, risks related to the Company's status as a real estate investment trust ("REIT"), and the potential impacts of an epidemic or pandemic on the Company’s business operations, financial results and financial position on the global economy. Additional information concerning these and other factors that could cause actual results to differ materially from these forward-looking statements is contained from time to time in the Company’s Commission filings, including, but not limited to, the Company’s (i) Annual Report on Form 10-K for the year ended December 31, 2025 and (ii) Quarterly Report on Form 10-Q for the quarter ended March 31, 2026. Copies of each filing may be obtained from the Company or the Commission. Such forward-looking statements should be regarded solely as reflections of the Company’s current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. The Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.
DEFINITIONS
Annualized Base Rent (“ABR”) is a non-U.S. generally accepted accounting principles (“GAAP”) metric which represents the monthly cash base rent for all leases in place as of the end of the period multiplied by 12. Accordingly, this methodology produces an annualized amount as of a point in time but does not take into consideration future (i) scheduled rent increases, (ii) leasing activity, or (iii) lease expirations.
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”) as defined by the National Association of Real Estate Investment Trusts (“Nareit”) is a metric established by Nareit and commonly used by real estate companies. The measure is a result of net earnings (computed in accordance with GAAP), plus interest expense, income tax expense, depreciation and amortization, excluding any gains (or including any losses) on disposition of real estate, any impairment charges, net of recoveries and after adjustments for income and losses attributable to noncontrolling interests. Management considers the non-GAAP measure of EBITDAre to be an appropriate measure of the Company's performance and should be considered in addition to, net earnings or loss, as a measure of the Company's operating performance.
Funds From Operations ("FFO") is a relative non-GAAP financial measure of operating performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO is defined by the Nareit and is used by the Company as follows: net earnings (computed in accordance with GAAP) plus depreciation and amortization of assets unique to the real estate industry, excluding gains (or including losses), any applicable taxes on the disposition of certain assets and any impairment charges on a depreciable real estate asset, net of recoveries.
FFO is generally considered by industry analysts to be the most appropriate measure of performance of real estate companies. FFO does not necessarily represent cash provided by operating activities in accordance with GAAP and should not be considered an alternative to net earnings as an indication of the Company’s performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers FFO an appropriate measure of performance of an equity REIT because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure.
4
Core Funds From Operations (“Core FFO”) is a non-GAAP measure of operating performance that adjusts FFO to eliminate the impact of certain GAAP income and expense amounts that the Company believes are infrequent and unusual in nature and/or not related to its core real estate operations. Exclusion of these items from similar FFO-type metrics is common within the REIT industry, and management believes that presentation of Core FFO provides investors with a potential metric to assist in their evaluation of the Company’s operating performance across multiple periods and in comparison to the operating performance of its peers because it removes the effect of unusual items that are not expected to impact the Company’s operating performance on an ongoing basis. Core FFO is used by management in evaluating the performance of the Company’s core business operations and is a factor in determining management compensation. Items included in calculating FFO that may be excluded in calculating Core FFO may include items such as transaction related gains, income or expense, impairments on land, retirement and severance costs or other non-core amounts as they occur.
Adjusted Funds From Operations (“AFFO”) is a non-GAAP financial measure of operating performance used by many companies in the REIT industry. AFFO adjusts FFO for certain non-cash items that reduce or increase net earnings in accordance with GAAP. AFFO should not be considered an alternative to net earnings, as an indication of the Company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers AFFO a useful supplemental measure of the Company’s performance.
Total Cash is comprised of cash and cash equivalents and restricted cash and cash held in escrow per GAAP as reported on the balance sheet summary.
Gross Assets represents total assets (reported in accordance with GAAP) adjusted to exclude accumulated amortization and depreciation and amortization of direct financing leases. The result provides an estimate of the investments made by the Company.
Total Debt is defined by the Company as total debt per GAAP as reported on the balance sheet summary including line of credit payable, term loan payable, notes payable, net of unamortized discount and unamortized debt costs and mortgages payable, net of unamortized premium and debt costs, as applicable.
Gross Debt is defined by the Company as Total Debt adjusted to exclude unamortized debt discounts and premiums and unamortized debt costs.
Net Debt is defined by the Company as Gross Debt less Total Cash.
Pro Forma Net Debt is defined by the Company as Net Debt less anticipated net proceeds from unsettled forward equity.
Management considers the non-GAAP measures of Gross Debt, Net Debt and Pro Forma Net Debt each to be a key supplemental measure of the Company's overall liquidity, capital structure and leverage.
The Company’s computation of FFO, Core FFO, AFFO, EBITDAre, Total Cash, Gross Assets, Gross Debt and Net Debt may differ from the methodology for calculating these non-GAAP financial measures used by other REITs, and therefore, may not be comparable to such other REITs. Reconciliations of net earnings, Total Debt and total assets (all computed in accordance with GAAP) to FFO, Core FFO, AFFO, EBITDAre, Gross Assets, Gross Debt and Net Debt (each of which is a non-GAAP financial measure), as applicable, are included in the financial information accompanying this release.
5
NNN REIT, Inc.
Balance Sheet Summary
(dollars in thousands)
(unaudited)
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March 31, |
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December 31, |
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Assets: |
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Real estate portfolio, net of accumulated depreciation and amortization |
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$ |
9,280,628 |
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$ |
9,239,542 |
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Cash and cash equivalents |
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4,570 |
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5,046 |
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Restricted cash and cash held in escrow |
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827 |
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776 |
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Receivables, net of allowance of $659 and $609, respectively |
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3,805 |
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3,470 |
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Accrued rental income, net of allowance of $3,475 and $3,393, respectively |
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36,021 |
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34,914 |
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Debt costs, net of accumulated amortization of $30,850 and $29,930, respectively |
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7,814 |
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8,645 |
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Other assets |
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88,626 |
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86,962 |
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Total assets |
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$ |
9,422,291 |
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$ |
9,379,355 |
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Liabilities: |
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Line of credit payable |
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$ |
80,000 |
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$ |
348,100 |
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Term loan payable |
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300,000 |
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— |
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Notes payable, net of unamortized discount and unamortized debt costs |
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4,474,123 |
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4,472,324 |
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Accrued interest payable |
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72,320 |
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40,557 |
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Other liabilities |
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100,579 |
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110,072 |
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Total liabilities |
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5,027,022 |
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4,971,053 |
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Total equity |
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4,395,269 |
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4,408,302 |
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Total liabilities and equity |
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$ |
9,422,291 |
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$ |
9,379,355 |
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Common shares outstanding |
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190,249,614 |
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189,937,404 |
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6
NNN REIT, Inc.
Income Statement Summary
(dollars in thousands, except per share data)
(unaudited)
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Quarter Ended March 31, |
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2026 |
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2025 |
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Revenues: |
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Rental income |
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$ |
240,014 |
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$ |
230,574 |
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Interest and other income from real estate transactions |
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410 |
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|
280 |
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240,424 |
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230,854 |
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Operating expenses: |
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General and administrative |
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14,106 |
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13,008 |
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Real estate |
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9,799 |
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9,375 |
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Depreciation and amortization |
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70,797 |
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64,617 |
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Leasing transaction costs |
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144 |
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130 |
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Impairment losses – real estate, net of recoveries |
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10,680 |
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1,512 |
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Retirement and severance costs |
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434 |
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2,173 |
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105,960 |
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90,815 |
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Gain on disposition of real estate |
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12,185 |
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3,813 |
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Earnings from operations |
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146,649 |
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143,852 |
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Other expenses (revenues): |
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Interest and other income |
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(28 |
) |
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(329 |
) |
Interest expense |
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52,726 |
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47,723 |
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52,698 |
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|
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47,394 |
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Net earnings |
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$ |
93,951 |
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|
$ |
96,458 |
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Weighted average shares outstanding: |
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Basic |
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|
189,031,812 |
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|
|
186,855,097 |
|
Diluted |
|
|
189,458,620 |
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|
|
187,080,084 |
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|
|
|
|
|
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|
||
Net earnings per share: |
|
|
|
|
|
|
||
Basic |
|
$ |
0.50 |
|
|
$ |
0.52 |
|
Diluted |
|
$ |
0.50 |
|
|
$ |
0.51 |
|
7
NNN REIT, Inc.
Other Information
(dollars in thousands)
(unaudited)
|
|
Quarter Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Rental income from operating leases(1) (2) |
|
$ |
233,571 |
|
|
$ |
224,056 |
|
Earned income from direct financing leases(1) |
|
$ |
82 |
|
|
$ |
114 |
|
Percentage rent(1) |
|
$ |
316 |
|
|
$ |
886 |
|
|
|
|
|
|
|
|
||
Real estate expenses reimbursed from tenants(1) |
|
$ |
6,045 |
|
|
$ |
5,518 |
|
Real estate expenses |
|
|
(9,799 |
) |
|
|
(9,375 |
) |
Real estate expenses, net of tenant reimbursements |
|
$ |
(3,754 |
) |
|
$ |
(3,857 |
) |
|
|
|
|
|
|
|
||
Amortization of debt costs |
|
$ |
1,752 |
|
|
$ |
1,466 |
|
Non-real estate depreciation expense |
|
$ |
95 |
|
|
$ |
43 |
|
(1) |
For the quarters ended March 31, 2026 and 2025, the aggregate of such amounts is $240,014 and $230,574, respectively, and is classified as rental income on the income statement summary. |
(2) |
Includes lease termination fees of $739 and $8,203 for the quarters ended March 31, 2026 and 2025, respectively. |
8
NNN REIT, Inc.
Reconciliation of Non-GAAP Financial Measures
(dollars in thousands, except per share data)
(unaudited)
|
|
Quarter Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Net earnings |
|
$ |
93,951 |
|
|
$ |
96,458 |
|
Real estate depreciation and amortization |
|
|
70,704 |
|
|
|
64,577 |
|
Gain on disposition of real estate |
|
|
(12,185 |
) |
|
|
(3,813 |
) |
Impairment losses – depreciable real estate, net of recoveries |
|
|
10,680 |
|
|
|
1,512 |
|
FFO |
|
|
163,150 |
|
|
|
158,734 |
|
Retirement and severance costs |
|
|
434 |
|
|
|
2,173 |
|
Core FFO |
|
|
163,584 |
|
|
|
160,907 |
|
Straight-line accrued rent, net of reserves |
|
|
(1,291 |
) |
|
|
(509 |
) |
Net capital lease rent adjustment |
|
|
46 |
|
|
|
60 |
|
Below-market rent amortization |
|
|
(126 |
) |
|
|
(93 |
) |
Stock based compensation expense |
|
|
4,046 |
|
|
|
3,571 |
|
Capitalized interest expense |
|
|
(580 |
) |
|
|
(921 |
) |
AFFO |
|
$ |
165,679 |
|
|
$ |
163,015 |
|
|
|
|
|
|
|
|
||
FFO per share: |
|
|
|
|
|
|
||
Basic |
|
$ |
0.86 |
|
|
$ |
0.85 |
|
Diluted |
|
$ |
0.86 |
|
|
$ |
0.85 |
|
|
|
|
|
|
|
|
||
Core FFO per share: |
|
|
|
|
|
|
||
Basic |
|
$ |
0.87 |
|
|
$ |
0.86 |
|
Diluted |
|
$ |
0.86 |
|
|
$ |
0.86 |
|
|
|
|
|
|
|
|
||
AFFO per share: |
|
|
|
|
|
|
||
Basic |
|
$ |
0.88 |
|
|
$ |
0.87 |
|
Diluted |
|
$ |
0.87 |
|
|
$ |
0.87 |
|
|
|
|
|
|
|
|
||
Dividend per share |
|
$ |
0.600 |
|
|
$ |
0.580 |
|
AFFO payout ratio(1) |
|
|
69 |
% |
|
|
66 |
% |
(1) |
Calculated as total dividends paid as a percentage of AFFO for each respective period. |
9
NNN REIT, Inc.
Reconciliation of Non-GAAP Financial Measures (continued)
(dollars in thousands)
(unaudited)
|
|
Quarter Ended March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Net earnings |
|
$ |
93,951 |
|
|
$ |
96,458 |
|
Interest expense |
|
|
52,726 |
|
|
|
47,723 |
|
Depreciation and amortization |
|
|
70,797 |
|
|
|
64,617 |
|
Gain on disposition of real estate |
|
|
(12,185 |
) |
|
|
(3,813 |
) |
Impairment losses – real estate, net of recoveries |
|
|
10,680 |
|
|
|
1,512 |
|
EBITDAre |
|
$ |
215,969 |
|
|
$ |
206,497 |
|
|
|
|
|
|
|
|
||
Interest expense |
|
$ |
52,726 |
|
|
$ |
47,723 |
|
Add back: capitalized interest |
|
|
580 |
|
|
|
921 |
|
Fixed charges |
|
$ |
53,306 |
|
|
$ |
48,644 |
|
|
|
|
|
|
|
|
||
|
|
March 31, |
|
|
December 31, |
|
||
Total assets |
|
$ |
9,422,291 |
|
|
$ |
9,379,355 |
|
Accumulated depreciation & amortization |
|
|
2,307,623 |
|
|
|
2,259,469 |
|
Amortization of direct financing leases |
|
|
2,592 |
|
|
|
2,546 |
|
Gross Assets |
|
$ |
11,732,506 |
|
|
$ |
11,641,370 |
|
|
|
|
|
|
|
|
||
Debt outstanding: |
|
|
|
|
|
|
||
Line of credit |
|
$ |
80,000 |
|
|
$ |
348,100 |
|
Term Loan |
|
|
300,000 |
|
|
|
— |
|
Notes payable, net of unamortized discount and unamortized debt costs |
|
|
4,474,123 |
|
|
|
4,472,324 |
|
Total Debt |
|
|
4,854,123 |
|
|
|
4,820,424 |
|
Unamortized note discount |
|
|
46,039 |
|
|
|
47,005 |
|
Unamortized debt costs |
|
|
29,838 |
|
|
|
30,670 |
|
Gross Debt |
|
|
4,930,000 |
|
|
|
4,898,099 |
|
Total Cash |
|
|
(5,397 |
) |
|
|
(5,822 |
) |
Net Debt |
|
|
4,924,603 |
|
|
|
4,892,277 |
|
Net proceeds from unsettled forward equity |
|
|
(73,966 |
) |
|
|
— |
|
Pro Forma Net Debt |
|
$ |
4,850,637 |
|
|
$ |
4,892,277 |
|
10
NNN REIT, Inc.
Debt Summary
As of March 31, 2026
(dollars in thousands)
(unaudited)
Unsecured Debt |
|
Principal |
|
|
Principal, |
|
|
Stated |
|
|
Effective |
|
|
Maturity Date |
||||
Line of credit payable |
|
$ |
80,000 |
|
|
$ |
80,000 |
|
|
SOFR + |
|
|
|
4.405 |
% |
|
April 2028 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Term loan payable |
|
|
300,000 |
|
|
|
300,000 |
|
|
SOFR + |
|
|
|
4.097 |
% |
(1) |
February 2029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Notes payable: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
2026 |
|
|
350,000 |
|
|
|
349,678 |
|
|
|
3.600 |
% |
|
|
3.733 |
% |
|
December 2026 |
2027 |
|
|
400,000 |
|
|
|
399,712 |
|
|
|
3.500 |
% |
|
|
3.548 |
% |
|
October 2027 |
2028 |
|
|
400,000 |
|
|
|
399,158 |
|
|
|
4.300 |
% |
|
|
4.388 |
% |
|
October 2028 |
2030 |
|
|
400,000 |
|
|
|
399,446 |
|
|
|
2.500 |
% |
|
|
2.536 |
% |
|
April 2030 |
2031 |
|
|
500,000 |
|
|
|
496,393 |
|
|
|
4.600 |
% |
|
|
4.766 |
% |
|
February 2031 |
2033 |
|
|
500,000 |
|
|
|
490,755 |
|
|
|
5.600 |
% |
|
|
5.905 |
% |
|
October 2033 |
2034 |
|
|
500,000 |
|
|
|
494,725 |
|
|
|
5.500 |
% |
|
|
5.662 |
% |
|
June 2034 |
2048 |
|
|
300,000 |
|
|
|
296,328 |
|
|
|
4.800 |
% |
|
|
4.890 |
% |
|
October 2048 |
2050 |
|
|
300,000 |
|
|
|
294,739 |
|
|
|
3.100 |
% |
|
|
3.205 |
% |
|
April 2050 |
2051 |
|
|
450,000 |
|
|
|
442,456 |
|
|
|
3.500 |
% |
|
|
3.602 |
% |
|
April 2051 |
2052 |
|
|
450,000 |
|
|
|
440,571 |
|
|
|
3.000 |
% |
|
|
3.118 |
% |
|
April 2052 |
Total |
|
|
4,550,000 |
|
|
|
4,503,961 |
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total unsecured debt(2) |
|
$ |
4,930,000 |
|
|
$ |
4,883,961 |
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Debt costs |
|
|
|
|
$ |
(44,420 |
) |
|
|
|
|
|
|
|
|
|||
Accumulated amortization |
|
|
|
14,582 |
|
|
|
|
|
|
|
|
|
|||||
Debt costs, net of accumulated amortization |
|
|
|
(29,838 |
) |
|
|
|
|
|
|
|
|
|||||
Notes payable, net of unamortized discount and |
|
|
$ |
4,474,123 |
|
|
|
|
|
|
|
|
|
|||||
(1) |
|
SOFR swapped to a weighted average fixed rate of 3.25%. |
(2) |
|
Unsecured debt has a weighted average interest rate of 4.2% and a weighted average maturity of 10.5 years. |
11
NNN REIT, Inc.
Debt Summary – Continued
As of March 31, 2026
(unaudited)
Credit Metrics
|
|
March 31, |
|
December 31, |
Gross Debt / Gross Assets |
|
42.0% |
|
42.1% |
Net Debt / EBITDAre (last quarter annualized) |
|
5.7x |
|
5.6x |
Pro Forma Net Debt / EBITDAre (last quarter annualized) |
|
5.6x |
|
5.6x |
EBITDAre / fixed charges |
|
4.1x |
|
4.1x |
Credit Facility, Term Loan and Notes Covenants
The following is a summary of key financial covenants for the Company's unsecured credit facility, Term Loan and notes, as defined and calculated per the terms of the agreements and indentures governing such debt, which are included in the Company's filings with the Commission. These calculations, which are not based on U.S. GAAP measurements, are presented to investors to show that as of March 31, 2026, the Company believes it is in compliance with the covenants.
Key Covenants |
|
Required |
|
March 31, |
Unsecured Bank Credit Facility and Term Loan: |
|
|
|
|
Maximum leverage ratio |
|
< 0.60x |
|
0.38x |
Minimum fixed charge coverage ratio |
|
> 1.50x |
|
4.09x |
Maximum secured indebtedness ratio |
|
< 0.40x |
|
— |
Unencumbered asset value ratio |
|
> 1.67x |
|
2.66x |
Unencumbered interest ratio |
|
> 1.75x |
|
4.04x |
Unsecured Notes: |
|
|
|
|
Limitation on incurrence of total debt |
|
≤ 60% |
|
41% |
Limitation on incurrence of secured debt |
|
≤ 40% |
|
— |
Debt service coverage ratio |
|
≥ 1.5x |
|
4.0x |
Maintenance of total unencumbered assets |
|
≥ 150% |
|
241% |
12
NNN REIT, Inc.
Property Portfolio
As of March 31, 2026
Top 20 Lines of Trade
|
|
Lines of Trade |
|
# of |
|
# of |
|
% of |
1. |
|
Automotive service |
|
47 |
|
748 |
|
18.7% |
2. |
|
Convenience stores |
|
31 |
|
688 |
|
16.3% |
3. |
|
Restaurants – limited service |
|
63 |
|
622 |
|
8.0% |
4. |
|
Entertainment |
|
7 |
|
96 |
|
7.1% |
5. |
|
Dealerships |
|
18 |
|
110 |
|
6.4% |
6. |
|
Restaurants – full service |
|
71 |
|
334 |
|
6.4% |
7. |
|
Health and fitness |
|
9 |
|
37 |
|
3.9% |
8. |
|
Theaters |
|
5 |
|
32 |
|
3.6% |
9. |
|
Automotive parts |
|
7 |
|
144 |
|
3.3% |
10. |
|
Equipment rental |
|
4 |
|
105 |
|
3.0% |
11. |
|
Wholesale clubs |
|
1 |
|
13 |
|
2.2% |
12. |
|
Drug stores |
|
3 |
|
59 |
|
1.9% |
13. |
|
Home improvement |
|
10 |
|
49 |
|
1.9% |
14. |
|
Medical service providers |
|
29 |
|
85 |
|
1.8% |
15. |
|
Early childhood education |
|
8 |
|
80 |
|
1.8% |
16. |
|
Pet supplies and services |
|
12 |
|
59 |
|
1.7% |
17. |
|
Discount retail |
|
7 |
|
66 |
|
1.3% |
18. |
|
Furniture |
|
14 |
|
43 |
|
1.2% |
19. |
|
Travel plazas |
|
4 |
|
24 |
|
1.2% |
20. |
|
Automobile auctions, wholesale |
|
2 |
|
18 |
|
1.1% |
|
|
Other |
|
84 |
|
299 |
|
7.2% |
|
|
Total |
|
|
|
3,711 |
|
100.0% |
13
NNN REIT, Inc.
Property Portfolio – Continued
As of March 31, 2026
Top 20 States
|
|
State |
|
# of |
|
# of |
|
% of |
1. |
|
Texas |
|
97 |
|
592 |
|
18.2% |
2. |
|
Florida |
|
95 |
|
271 |
|
8.8% |
3. |
|
Illinois |
|
52 |
|
181 |
|
5.2% |
4. |
|
Georgia |
|
65 |
|
172 |
|
4.4% |
5. |
|
Ohio |
|
74 |
|
211 |
|
4.2% |
6. |
|
Michigan |
|
33 |
|
146 |
|
4.0% |
7. |
|
Tennessee |
|
47 |
|
156 |
|
3.6% |
8. |
|
Indiana |
|
44 |
|
164 |
|
3.5% |
9. |
|
North Carolina |
|
46 |
|
157 |
|
3.5% |
10. |
|
Arizona |
|
36 |
|
86 |
|
3.5% |
11. |
|
Virginia |
|
44 |
|
119 |
|
3.3% |
12. |
|
Alabama |
|
39 |
|
154 |
|
2.9% |
13. |
|
California |
|
26 |
|
71 |
|
2.8% |
14. |
|
New Jersey |
|
20 |
|
33 |
|
2.3% |
15. |
|
Pennsylvania |
|
39 |
|
84 |
|
2.2% |
16. |
|
Missouri |
|
33 |
|
102 |
|
2.2% |
17. |
|
Maryland |
|
20 |
|
52 |
|
2.0% |
18. |
|
Colorado |
|
28 |
|
47 |
|
2.0% |
19. |
|
South Carolina |
|
29 |
|
80 |
|
2.0% |
20. |
|
Louisiana |
|
30 |
|
65 |
|
1.8% |
|
|
Other |
|
167 |
|
768 |
|
17.6% |
|
|
Total |
|
|
|
3,711 |
|
100.0% |
14
NNN REIT, Inc.
Property Portfolio – Continued
As of March 31, 2026
Top 20 Tenants
|
|
Tenant |
|
Primary Line of Trade |
|
# of |
|
% of |
1. |
|
7-Eleven |
|
Convenience stores |
|
145 |
|
4.3% |
2. |
|
Mister Car Wash |
|
Automotive service |
|
120 |
|
3.8% |
3. |
|
Dave & Buster's |
|
Entertainment |
|
34 |
|
3.6% |
4. |
|
Camping World |
|
Dealerships |
|
46 |
|
3.5% |
5. |
|
Kent Distributors |
|
Convenience stores |
|
64 |
|
2.6% |
6. |
|
Flynn Restaurant Group |
|
Restaurants - limited service |
|
204 |
|
2.5% |
7. |
|
GPM Investments |
|
Convenience stores |
|
143 |
|
2.5% |
8. |
|
AMC Theatres |
|
Theaters |
|
19 |
|
2.3% |
9. |
|
BJ's Wholesale Club |
|
Wholesale clubs |
|
13 |
|
2.2% |
10. |
|
LA Fitness |
|
Health and fitness |
|
24 |
|
2.1% |
11. |
|
Mavis Tire Express Services |
|
Automotive service |
|
140 |
|
2.1% |
12. |
|
Couche-Tard |
|
Convenience stores |
|
92 |
|
2.0% |
13. |
|
Sunoco |
|
Convenience stores |
|
53 |
|
1.7% |
14. |
|
Chuck E. Cheese |
|
Entertainment |
|
51 |
|
1.7% |
15. |
|
Walgreens |
|
Drug stores |
|
48 |
|
1.6% |
16. |
|
Casey's General Stores |
|
Convenience stores |
|
62 |
|
1.6% |
17. |
|
United Rentals |
|
Equipment rental |
|
49 |
|
1.6% |
18. |
|
Tidal Wave Auto Spa |
|
Automotive service |
|
35 |
|
1.5% |
19. |
|
Super Star Car Wash |
|
Automotive service |
|
33 |
|
1.3% |
20. |
|
BMW Kar Wash LLC |
|
Automotive service |
|
41 |
|
1.3% |
|
|
Other |
|
|
|
2,295 |
|
54.2% |
|
|
Total |
|
|
|
3,711 |
|
100.0% |
Lease Expirations(1)
|
|
# of |
|
Gross Leasable |
|
% of |
|
|
|
# of |
|
Gross Leasable |
|
% of |
2026 |
|
76 |
|
524,000 |
|
1.0% |
|
2032 |
|
192 |
|
1,898,000 |
|
4.9% |
2027 |
|
202 |
|
2,633,000 |
|
6.1% |
|
2033 |
|
133 |
|
1,395,000 |
|
4.2% |
2028 |
|
221 |
|
1,970,000 |
|
4.9% |
|
2034 |
|
194 |
|
2,838,000 |
|
5.8% |
2029 |
|
139 |
|
2,049,000 |
|
4.2% |
|
2035 |
|
136 |
|
1,805,000 |
|
4.2% |
2030 |
|
184 |
|
2,417,000 |
|
4.7% |
|
Thereafter |
|
1,895 |
|
18,128,000 |
|
51.5% |
2031 |
|
284 |
|
3,394,000 |
|
8.5% |
|
|
|
|
|
|
|
|
(1) |
|
As of March 31, 2026, the weighted average remaining lease term is 10.1 years. |
(2) |
|
Square feet. |
15