If You Invested in Vereit (VER)

VEREIT, Inc. (historically NYSE: VER) was a full-service real estate operating company focused on owning and managing one of the largest portfolios of single-tenant commercial properties in the United States. The company described itself as having total real estate investments of approximately $14.5–$14.6 billion, including about 3,900 properties and roughly 88.7–88.9 million square feet of space. VEREIT operated as a publicly traded Maryland corporation listed on the New York Stock Exchange and was part of the broader net lease real estate investment universe.

According to multiple company communications, VEREIT’s business model centered on providing equity capital to creditworthy corporations in return for long-term leases on their properties. This approach is consistent with a net lease and sale-leaseback strategy, where tenants enter into long-duration lease agreements and the real estate owner receives rental income over the term of the lease. VEREIT emphasized its role as a full-service operator, indicating involvement in both ownership and management of its single-tenant commercial portfolio.

Merger with Realty Income and corporate status

On November 1, 2021, Realty Income Corporation and VEREIT, Inc. announced the completion of their previously announced merger. The companies stated that the common stock of the combined company would trade under the symbol "O" on the NYSE beginning that day. Under the terms of the merger agreement, VEREIT stockholders were entitled to receive, for each share of VEREIT common stock held, 0.705 shares of Realty Income common stock. Earlier, on August 12, 2021, Realty Income and VEREIT stockholders had approved all proposals necessary for closing the merger.

Following this transaction, VEREIT’s former operations and assets became part of Realty Income. Realty Income also described plans to spin off substantially all of the office assets of the combined company into a new, publicly traded REIT named Orion Office REIT Inc. (NYSE: ONL). In connection with the merger and spin-off, Realty Income and VEREIT issued information regarding dividend tax allocations and the treatment of legacy VEREIT notes that were exchanged for new Realty Income notes.

Portfolio characteristics and operating profile

In its public disclosures prior to the merger closing, VEREIT highlighted several structural features of its portfolio and operations:

• Ownership and management of one of the largest portfolios of single-tenant commercial properties in the U.S.
• Total real estate investments of roughly $14.5–$14.6 billion, with about 3,900 properties and close to 88.7–88.9 million square feet.
• A focus on long-term leases with corporations considered creditworthy by the company.
• Use of non-GAAP metrics common in the REIT sector, such as Funds From Operations (FFO), Adjusted Funds From Operations (AFFO), Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre), and Normalized EBITDA, to evaluate operating performance.

VEREIT also reported portfolio statistics such as occupancy, investment grade tenancy, and weighted-average remaining lease term in its quarterly operating results. These disclosures reflected the company’s emphasis on stable rental income, lease duration, and tenant quality as key elements of its net lease strategy.

Historical operating results and capital activity

In its second and third quarter 2021 operating results, VEREIT discussed net income, FFO, AFFO, and Normalized EBITDA, along with rent collection percentages and leasing activity. The company described high rent collection levels based on contractual rent and recoveries, and reported same-store contract rental revenue growth compared to the prior-year periods. VEREIT also outlined its acquisition and disposition activity, including property acquisitions, build-to-suit projects placed into service, and office and strategic dispositions.

VEREIT’s communications detailed its balance sheet and liquidity, including corporate liquidity, availability under its credit facility, and measures such as Net Debt to Normalized EBITDA, Fixed Charge Coverage Ratio, Unencumbered Asset Ratio, and Net Debt to Gross Real Estate Investments. The company also described actions related to its capital structure, such as the full redemption of its 6.70% Series F Cumulative Redeemable Preferred Stock, funded with cash on hand and its undrawn revolver.

Dividends and preferred stock

VEREIT’s board declared cash dividends on its common stock and Series F Preferred Stock prior to the merger closing. For example, in October 2021 the company announced a monthly common stock dividend and noted that it expected to continue declaring dividends on a monthly basis until the closing of the merger with Realty Income Corporation. The company also announced the redemption of all outstanding shares of its 6.70% Series F Cumulative Redeemable Preferred Stock, specifying the redemption price per share and the cessation of dividend accrual on the redemption date.

Realty Income later released information on the final calculation of dividend tax status for VEREIT’s 2021 common stock and Series F Preferred Stock dividends, including the portions treated as ordinary income, capital gain distribution, and non-taxable return of capital. Realty Income also described how certain legacy VEREIT operating partnership notes were exchanged for new Realty Income notes and provided estimated issuance prices for those new notes.

VEREIT as a historical net lease platform

VEREIT’s description of itself as a full-service real estate operating company with a large single-tenant commercial portfolio, significant total real estate investments, and a business model based on providing equity capital to corporations in exchange for long-term leases places it within the net lease real estate segment. The company’s merger into Realty Income and the related office asset spin-off into Orion Office REIT Inc. are key historical milestones for investors researching the former VER ticker.

Today, VER is best understood as the historical ticker symbol for VEREIT, Inc., whose assets and operations were combined with Realty Income as of November 1, 2021. Investors and researchers looking at VER typically review it for historical context on VEREIT’s portfolio, net lease strategy, capital structure, and the terms of its merger with Realty Income.