Store Capital (STOR) 5 Nov 202020 Q3 Earnings call transcript

Good day, and welcome to the STORE Capital Third Quarter 2020 Financial Results Conference Call. All participants will be in listen-only mode. [Operator Instructions]. After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. to conference like Mueller. to now would turn over the Lisa I go Please ahead.

prepared maximize and and provide for be call. section the results. at to you if queue to you, supplemental will can and keeping Investor management then your and the thank Thank operator, open follow-up call Relations which presentation, all today's Results, are issued have earnings Capital's we under observing includes ir.storecapital.com you On available call will quarter remarks quarterly the call during Participants limit investor we then for questions. Q&A we Results. discuss re-enter third website joining will documents XXXX our two-question of hour, questions. an morning, financial today's Quarterly our This In information our News participation, portion the for a release These call. up STORE today of order to while us the in

like Before will federal we begin, I securities laws. under to remind forward-looking statements include that the comments today's you would

estimates, us by that cause those goals, COVID-XX materially differ statements actual in forward-looking and the expressed or arising the involve impacts uncertainties, are projections, risks statements. tenants nature, their and from forecasts and including related its outcomes to pandemic and subject to our Forward-looking on assumptions and results could from those

such call now please Executive results forward-looking XX-Q. SEC condition these financial to that and statements like from operations reports contemplated go results Volk, of Store's Chris, of statements. With would cause Chief Discussion I forward-looking XX-K, may over from ahead. our Form the Chris our by and materially actual differ Our our including filings, materially in could to vary contained to turn those are factors the Officer. that, on

our Cathy earnings Chief Lisa, With Fedewa, Officer quarter and President good to today and our Capital's Financial and Operating day Officer. are Chief me welcome everyone, Thank Long, XXXX STORE call. you, and Mary third

families be speak hope welcome and a to today We continue fronts. safe. you always, we on and today to you the and opportunity healthy encouraged As of number to to your that you come

to rent with remain Mary says October. investment pre-pandemic over distancing. on investment diversity risk rent occupancy rise social provide is portfolio at delivery. profile, added as importantly, the our to has which for achievements return our and our suburban generally sector the at heart for Perhaps, has been collected Meanwhile, with record our the been Our has Such our levels of important will this said, let most yields of our me quarter. more a into portfolio portfolio levels, high discuss to continue XX% performance vacancy adjusted demands we lot. collections steadily success, of here, but and that our detail that pandemic conducive is sustained. With which entered investment

which address healthy Our Score contracts, been migration, is upon with this remains Mary of expected with of investment an based rated XX.X%, this. methodology. portfolio grade quality our occupancy some near-term net and lease the and STORE has pandemic in our There with plurality will contract rate

on total to On historically we elevated our portion financial of to levels. of which our the during unencumbered balance any broad of front, balance of, public of know sector $XXX sheet noteholders full our a and investments majority low the I cost, of XX% than a quarter, flexibility sector-leading about defensive our third cost financing to over REIT credit the unsecured providing and is at options. STORE's stood lower sheet unencumbered leverage million acquisition rating. new results of assets and our made asset irrespective low investments in Leverage stockholders of unencumbered corporate with our leverage XX% recourse reduced most

to quarter relevant statistics some investment are here activity. quarter, each our do third I as Now

quarter lease annual to providing average investments properties contractual during weighted lease escalation XX.X%. Our leverage the rate us the on certain lease initial a Presently, lease average for with the made escalations in by instead not acquired during X.X%, these conservative was to X.X% which adding get employing are about was of for quarter return, rate we investments, electing more posture the gross our you the rate times. a maintain less new

net XX%, need incorporate at XX%. operating costs area the levered corporate approximate of However, XX% customary to return our leverage about in with we returns would investor our after

a cost variables the our new as average and to investments operating expected Our time four annual of return. percentage why lease are STORE years. The term assets. predecessor cost rates of compute enable is robust and investment successful at spreads our escalations, mostly approximately business long-term take weighted lease investment companies by historic These investor you model, from XX disclose outperformance long the borrowings continues to investment to to and we driven which returns public have contractual of been quarterly primary yields, our be essential our

am we A is I about I is important since than lease remained in terms, our companies. defensive that extending years did term which as constantly master into with add X% away net reason our maturing of are XXXX. I and primary of to over far the that arrangements. public major the lease years, at XX we portfolio has quarter, new existing amongst we five aware lease As peer Moreover, would for investments like attribute contract lease less the lowest, average our next last lease note highly terms weighted are

a be. good Given an is lack economically of environment, to fragile our maturities near-term lease place definitely

moments all net The Another growing of master is certain fixed for further ratio XXXX has like important to extremely was interest working Alignments assets in of less tenant leases. period. desirable purchased ratings to-X. long-term risk. the reduction renewal we post-overhead you more multi-location to new grown the from XX% portfolio tenants that our result important, in now were median our is work, alignments, during coverage a quarter have credit to disruptive with today. Moody's subject XX% eventual elevation believe, investment Perhaps, stands meaningful this most are charge lease Since rating be XX% X.X of incorporate constructively been at BaaX. especially be median XXXX, during in unit The the STORE which in Score favorable will contracts And in an The median BX. lease contract if new interest percentage this. coverages where this of that of number that potent and is the our investments fixed much contract profile RiskCalc charge level was for level attribute was

the of the during and to at investments all financial made were made replacement statements. cost net XX% lease was investment new average Our quarter required unit-level approximately deliver

properties our been estate to continue level deliver pay our assess reporting. to is quality contracts the seniority we this. important to has like ability unit This times with to ability which critical to especially is us be and Here, financial and lease substantially at all sector rents, statement leader evaluate essential our quickly to real net required of tenant's ability to our

leadership Importantly past during this of a and number quarter, corporate changes. we announced structural

in STORE. and two various a monitoring separate should the to department. in portfolio publicly be are been asset sales, sector-leading role portfolio We our quality sector-leading it has diversity and consistently contract activity shared felt been amongst management departments. the we you. played have indeed key activities elevated annual our background, our credit step chose fold create some have started portfolio our that a delivering group way management this side, management prior we By to On net we successful listed There we when the of portfolio lease department to into structural took companies,

much of are During management the our activity solidly this collections their team our pandemic, our been center and portfolio on performance. of at rent imprinted has fingerprints

decision our roof. made team under credit-centric Given credit activity, of consolidate a level within the this to skills high embedded single evaluation members we the

in Importantly, change this STORE with was President Mary Fedewa elevated Capital. concert to of

GE I other also Mary changes when worked Mary was a We public business was our to company integration XXXX, Corporation public me the I Capital, since in discuss. where Franchise a had in an invited lease of our where company few Finance she she Later, made America career. she instrumental with development. have into second that leader organizational earliest net impressive her join in will of

would to serving STORE, by later she our joining conceptualizing She our Board start company heading moved on are Co-Founder to to I we in this as if our of to As being team. efforts XXXX, development Mary our to STORE called business in eventually Chief interested be Officer. Carolina and Arizona see added Directors Operating with North from of distinction

And quarterly calls, conference Mary's So President. call our this proud as her. this over will to I'm to turn of first many be

Chris, hello acquisition Thank begin activity. our with and I'll you, everyone.

X.X%. average in the third real estate properties quarter, rate $XXX invested at cap million of we a weighted During

million portfolio. with $XX consistent quarter of this vacant to exception more than keep customer $XXX granular properties tenants management was added tenant subject customers only collaboration our and no lease. of low continued a spread and less absolute an XX were average and revenues strong with X,XXX investments of We across more our and have Our to at size we in the portfolio have assets than active vacant With transaction and closed consistently transactions with XX relationships diverse and average XX number over than not the quarter million. new XXX remained our

and sales in resulted ongoing gain cost. acquisition our sales quarter, part our our costs. portfolio $XX XX% very we over of to XX% to During opportunistic remaining strategic million. at of were Eight management were XX total Three a sold had which seven cost activities original property the in these a cost, properties, reposition properties close resulted of recovery prices were were sold of and an the and

Over years, of high estate liquidity assets. $X.X a for real of we billion granular about our the have worth past reflecting level four sold

the of portfolio have the to granularity cash be a start have and business our to continues we been and STORE's at the In been addition, Diversity recycle diversified. hallmark well sales yields. able model accretive from from

definitely was diversity diversity September service-driven portfolio mix XX% Sector XX% and our XXth, in in of by strong real sector, our facilitate our in communities as retail exposure service the sector retail and and manufacturing. been XX% that experiential remaining the helpful investments, has centered businesses XXXX, in As much in performances distancing. of from estate well social as manufacturing with geographic with

continued remained down concentration our diversity currently our customer more just The representing interest. XXXX. of and from of of base than also have and single Farm largest over diversity, with revenues. rent rent customer, Fleet and base customer XX.X% represents has to strong and X% no annual our just top addition customers representing XX.X% In decline sector XX geographic our to of X.X% in time interest, we

new comprised addition, of highly investments. which opportunities, In tenants allows fourth of account making base our X% or quarter be to entered portfolio rent strong to We less us and that XX% pipeline and of the of interest. is a nearly for opportunistic with selective in continue

ownership flow enabled that of deal assets estate elevated which our low This reflected lease comparable realization importantly yields. is is existing the rarely by of Our leases, pipeline in intangibles. means level our we real having ownership lease direct

had we mentioned, due statements. anticipated and that Chris to of collection some in short-term our As financial ratings our migration most recent COVID, is tenant reflected in contract

investment rated directly our as from analysis XX% of grade, decline by XX% this contracts related our to XX% portfolio. COVID Our is determined Score to of STORE declined industries. sensitive

of pandemic, move that our out fully levels. the As historic will STORE revert anticipate gradually we scores to we

that quarter and came constant thing. important portfolios ratio the margins the fixed times. for tenants we is coverage level, managed held cycles, unit note market include second material of is deferrals, into the several at margins STORE It many the we the benefit safety. across to X.X Our real When safety, estate with with built pandemic charge which we've important of rent

promotions Barnett in attribute granularity business Acquisitions, industries financial where the and GE's can earlier. and the member Prior management and will of to we program, an Franchise announcement underwriting Maertz was portfolio recent planning model gained Management. he as collected to Capital by Portfolio well experience of Number Portfolio and Barnett an to been developing delivery portfolio, to has Tyler our and three, of sales which consistently GE performance. company's perform one, STORE risk beginning the also credit a at origination President unprecedented with Tyler it prior net joining vital in spent that and group approach. lead major coverages to our extensive which portfolio our played quickly pandemic, Craig XX look Craig building of Vice leadership STORE, credit-centric our leadership to When lease Senior inception the and Vice success Management very Tyler range the going continues portfolio extensive of team, Number worked companies Executive analysis organization of management the includes a with diversity Tyler, comes Vice He respond two years things. to our served, Chris statements contributions have to a us unaffected our our the three in associated direct well-deserved leadership graduating having at and wide our each management consolidated GE We President want has number mentioned both Executive esteemed financial established allowing potent background Craig STORE's from investment joined to and has that previously impactful executive been management two, pivot the our team. customers' were at and utilizing portfolio at role their adjusted also President and needs, Finance. strong into team both to contributor with COVID. an to has Underwriting I team. since our in to forward having highlight of to that ongoing growth team, company. of we our our Like and financial quarter. STORE Our

fifth are XXXX. annual for planning our Finally, late currently conference January, we customer

amazing for we Although, expertise inside a will the whose give program it track turnout the year. another strong our customers speakers our coming and expect this virtual of will year, will outstanding feature be lineup

discuss speakers all I'll really financial conference. to Cathy looking are customer valuable We our our forward the results. now, insights XXXX call hearing to from to distinguished turn And at our

year-over-year. from and quarter the then call to an and comparisons provide I'll third acquisitions. financial XXXX sheet, initial activity capital our today's Consistent quarter, results sequential quarter, Mary. provide I'll third Thank markets update bridge balance on results. be for quarter guidance our discussed discuss on last our you, with for will and All second our a other

third began the real to driven contribution quarter as of net pandemic. Our levels third increased in the to growth quarter rent offset from by million recovery revenues X% year-ago a activity. portfolio Sequentially, $XXX.X properties increased impact from in and revenues a $X.X reflecting million, the acquisition positive reopen estate our the by re-tenanted quarter

represents in almost share. the factors third and during AFFO. $X.XX from pay overall in in revolver earlier property an million, $XX quarter. in million generally September per increase these quarter, together, second Lower deferral approximately COVID which resulted rent XXth, costs stood begin Rent repayments. of increase At of interest scheduled of deferrals no $X approximately the fourth at contributed $X.XX about share AFFO is granted $XX a sequential and from $X.X resulting repayments down than lower rent Taken in down another of expense receivables significantly quarter. the reserves rent year-to-date diluted We $XX per million net million of million million our of to were $X.XXX this approximately of deferrals the $XX

the in quarter tenants we amounts So the deferred early. from payments some their repaid received who of third were

quarter, quarter, increased were at fully of G&A by program expenses $X.X the million credit November on increased for the the interest quarter our executive expenses, Property XXth, year-over-year from we our we last expense debt sheet. $XXX $X.X fund acquisition Funding expense. from interest reflecting By September a repaid by ago our we the costs flat million third issued available the had expense primarily, activity. under in line higher year quarter to excess to incurred turning maintaining for entire million Master liquidity million. to both severance revolving the balance Now and year essentially and future is ago $X.X due

non-cash from impact basis to XX severance XX acquisition expenses lower equity portfolio ago, assets, As year volume on points with expenses, acquisition-related expense and reflecting decreased compensation costs. points average excluding percentage a basis the reduced a of along declined G&A of our travel-related

was portfolio properties was which we $X.XX aggregate ago, share, record to by on down per for $X payout cash X.X% AFFO million a actual ago. quarter and quarter's share in dividend quarter, third and our represents This XX% quarter. prior from three This increased impairment per a calculating recognized quarter. XXth. October. included a in third shareholders a our the $X.XX the share reflecting XX% for basic and paid In On XXXX We growth. XX% ratio collected our $X.XX of we for the from increase the was per driven on only quarter basis, a AFFO an likely increase XXth XX% confidence diluted second from $XXX rent sell. the to the collections, declared receive rent year September representing million for and to totaled During per the of dividend rose October market on provision $XXX percentage tenants. third share cash cash payments from from outlook the to we're of of $X.XX a year we've interest collections approximately quarter Aggregate the million a

weighted rate cash approximately Now $XXX billion of turning from with sheet. full stock our ATM of and and we million. weighted September Program average price an quarter and We $X.X average to credit acquisitions debt XXth, balance access We equity average interest equity proceeds sales. raising activity funded share, shares million long-term with the fourth $XXX X.X%. in facility. had proceeds the million of the quarter X.X of approximately our asset entered in X issued cash $XX.XX net years At at acquisition with of approximately to We maturity of under a along with common $XXX of million a per our

providing of million volume initial XXXX. turn $XXX net million our target of $X are XXXX we're for to current XX% the now, acquisitions low billion track back debt remains the I'll leverage closed Year-to-date, our portfolio a reach range range net we to cost to in and have for acquisitions net sales. $XXX until guidance significant on to maturities no acquisition basis $XXX on $X.X on of debt at we've billion to Our XXXX. of pipeline, anticipated And Based million Chris. call and

Cathy. so Thanks much,

over usual a to make the your few operator before like As this turning and comments. for to questions, I'd call brief

us First, over have COVID-XX impact passed past business we consequential since the as and greater we giving early with of having eight March, the months we the the know included in in now portfolio knowledge we the and added than With illustrate more data trends shutdown two presentation addressing our predictive. then ability abilities to done have be general raising disclosure monthly our did to new pandemic. initial much investor quarters, greater

This able we be until of call at guidance. you performance offer guidance Historically, portfolio believe and data that Our year-end is tied to address continue estate comfort are future collection of third expected optimism. This ability by with near, updates. rate be activity it our providing leadership greater us and provided when early performance earnings for together shows our comes investment and scientific our the time to that earnings during and Cathy is to then, rent guidance business. tenants which open deferring to give initial with we to pandemic to we will XXXX practice this we for have assertions quarter year conduct with that such a frequent offered we our our political plan XXXX, Certainly, our year to Until foresight. real vaccine monthly cost for XXXX, has guidance earnings commerce call.

onset raise in on REITs XX% dividend COVID knowing I'd how ratio AFFO meaningful our XX% per portfolio April, to a a to resulted an on reflected would long. of pandemic quarterly closure a much making basis trend raise no on for and rent cash of our had of and had a in When about way payout the quarter March cash one the of our this answer share was maintained the or our on we dividend us economy brief we the impact Finally, saw and such how just believe resulted computation, our If collections. it That for make from dividend. collections with optimism rising its there. this STORE We pandemic. with the U.S. quarter, conceived basis, in dividend fully like we XX about that approximated the our of cash we in never third is, because XX% of look trough XXXX covered rapidly begin XXXX deferral in trended our quarterly collections not second will that towards month dividend since payout payout dividend scenario. by the a flow ratio knowing Though ratio towards The we a expected since to cash rent cash in basis historic trend include levels. our comment

to former team have our themselves happen our effort be is, STORE internal in out in high a XXXX. the protection our payout and committed so and of able expectation all on be area amazing behalf an low we give this been stakeholders. members full Our Making will ratios we has and of to a other customers shout job shareholders, to of team that dividend

As jobs this fundamental in And operator our provide X.X created call around beyond, share from national now to to for of across companies by stand and out over begin more regional in a And look our benefit leaders on that industries. than event. and STORE economic of our are to like market larger to I'd that our middle the to Collectively, market. betterment. XXXX comprise elevated operate backward any there target created since or the million generally XX,XXX be role we such many to XXX needed be employ will questions. the locations are collective market customers play pandemic we estate capital will approximately approximately economy turns turn companies proud and and real

Thank you.

Jefferies. of The will We from Linda [Operator will now question the question-and-answer begin session. Instructions] be first Tsai

good Hi, morning.

the great Albeit... and becoming inspiring a to I ascent. your on STORE. to acquisition cap President wanted at accomplishment congratulations about rates. see It's Mary, First, ask

Thank you.

the... Albeit

thank you return. said, I in

driving rates for row. to remain than cap wanted this? I ask elevated about lower XQ acquisition What's Sure. a the second albeit in quarter

you hey, again, So, thank Linda.

then comments maybe light and about Chris this well. some Let market add the as in me will will shed general some and talk

cap rate compression imbalances, the will compression overall, will, into are levels. And generally that is in general. sort industries rates grade demand quality pre-COVID and to that you pre seeing - So fund our in believe, The well supply investment back of to some to if is I COVID. to as more go related as like makes cap we - due sense

there and like industries some companies now COVID. favored well are have industrial right then So done or that in

that's So rate cap bit little a creating compression. of

As doing you we know customers on a call business pipeline been long model that our to is we've for customers, a for with directly have time.

So your it's not a knocking perfect market create there if out doors and do out there cap and you're on you rates to yourself flow can deal that.

general, really were a there that see out in pipeline, the - pre-COVID. expect go but do we're, nice So seeing have - we flow see and towards compression as deal we back rates and will we're cap improved well gradually

is that of this and that development And as a And on number reminder, having XX makes just XX. in I XX, have, would XX difference. Linda. and people people Chris, we huge having group we coverage have say our business a going

is perceive the quality. brokers point remove equation for quality item it can room a flight - terms of one and a to you whatnot, to cap her rates. If in flight then other from seeing added Mary's gives you're that to And you

MSAs, investment to I this, with Lot that. but say think, could tenant properties, necessarily been a especially a respect this after are major I there's size assets. smaller of grade if in with that. of And seen after assets won't because chase like I smaller industrial quality some all assets there's chasing after it's bite your I going all of if sort lot especially you've then chasing of - they of agree perceive in industrial if

originations has so what investors, done which of is we've been mindset, always a our part investor of the spots, part table. also it's picking direct to we're it And value brought being value so we've and always

color. for a And just Thanks as follow-up. that

acquisitions, In industries? of was quarter what the the of terms third composition

third, withstood This than third about is actually Well We investing - us, from most into unmanufacturing usual. and we in makes that heavier third, have sense I side of benefited were Mary we to which are between and of and the industries and again. than in that's the cases little COVID a And retail service during would most a say had for have COVID manufacturing. a a impact COVID. fund

Thank you.

will question BMO. from Frank next of Lee be The

think that How good on we Hi, morning, mentioned in you you're about investments. everyone. I for leverage apply remarks know not new acquisition? fundings looking your should future Chris, prepared to

to So maybe we be funded been has with with down? that or the paid ATM continue dispositions expect debt to should match deals some fully line and note the

to we our I'll mean is Cathy, I appreciate. answer debt a say, pick were year our see And you would think this this with I would going collections up, and we just which pick cautious we but but I is taking approach, - as our funded ratio see EBITDA EBITDA up what is as happening to drop.

than with you're going funding us that more equity. And so I to as you get with expect see XXXX, into

mix So change. will slightly the

basis an on overall will smooth. it Although, be

of EBITDA. to XX% historic out in mean debt tends around So work. of work which of our kind to funded average I sort cost, is of X.X to leverage kind times daily that to it's

is happens this where just not. whether say pretty the I it going markets now to be As can't we'll and what us, into to year, end debt of are close between the

rates debt attractive. the Right, are

markets So you see the the may so. or us tap in next debt months six

Okay, timing I bit collection the to a by or collections It then from collections October read it anything a here your there industry just like rent Is dipped rent like restaurant is in issue? into thanks. if looks look slide. at And September.

Mary. hey, this is quarter - the For

the you - importantly a theater trend. the as timing slight the most, mostly just uptick ones collections our really movie in industry, Wouldn't XX%, been concentrated industries are through it's this. again, So a like deferrals which were - the that space restaurant were was there - more rent If have in has the suffered the most the issue. six know,

you. Thank great. Okay,

of The from ISI. next question Evercore Sheila will McGrath be

this Yes, Chris, in these market the perspective widest the debt. good rates if - of cost I Is afternoon. terms - currently of versus could wondering give Is you in the cap just seen? perspective available? you've ever was us are spreads that some historical

north that's stunning that invest kind rates it's X%. mean, with spread. I of debt cap X% at in It's I Yes, and and you can mean of X% borrow ballpark. between really

So, it's very attractive. yes,

that be to term? make a aggressive you volumes And does the in want near on little more investment

marketplace. attentive being We're to the

sort our we're terms running. I acquisition to of where was ramping think pre-COVID that of levels in pace up

month. quarter, So and ramping see recently that QX, of is a a so in always doing, be up ramp we've a for half basis, over can the are thought kind of close guidance month a to a we're we're $XXX normally third far net year-to-date, assets. last while, to that, and hope falling - to And for then but we going speed we we short definitely year a $XXX of net at selling off obviously on kind running but Cathy we range, been this which further. for that's kind XXXX, we're quarter of certainly, disclose has number. $XXX And really, million million month doing, a given way, next up were by you million we've so

Okay, thank you.

Thank you.

from The Allaway Green Spenser next Street. of comes question

in Spenser. with you. Thank This is Harsh filling

as that about different a bit collection been deferrals Can industries. little extend You have any granted? talk you if spoke such happened little those the period? about over collections that renegotiated And a bit and rent payback to

you got itself? question period. we sure of We about Could it, the question. heard part the the not payback I'm repeat all of

a there bit has little deferrals asking, Yes. have about the them? can granted? from if negotiations any I been you if you And was talk just

renegotiations Were deferrals the on there we any granted? that

Yes.

Mary. is this - for So

for had deferrals. now months requests new no So many for actually we've

to industries of from We our a have having the bit customers impacted had come them. and little highly extend in deferral back

see portfolio, overall If our rent our and on given we even you less months in highly we of impacted will X.X given have deferral, months that at you average only of than look deferrals. industries three have

We be have tailored able industry. terms depending them for the to pay on to back

but helpful? new the have deferral has long rent. been of may that have inside a no may time. six months, three of And Someone three amount someone Is deferrals we months months, in the of overall passed again,

in much coverage has on line helpful. - Yes, But of and broadly you. with like what that then total some subcategories coverage more the it's restaurant, seen little said that you've fared Thank rent retail is pre-pandemic. a commented pretty how on And rent larger education? you on

the - the asking How and education? with of certain - coverage you're early with sectors like restaurants our coverage are how larger the

Yes.

overall, received one mention that - quarter So had them. financial I of recently impact statements COVID did in we like

June So of our financial we received tenants. statements from most

you with benefit pre-pandemic. If give you look trailing did customers basis covering deferral at they're deferrals, the a those actually of and statements financial to we on what consistent those that gave they XX-month

will you coverages and pandemic. So in as into exact And both, which of I see really restaurant education, childhood say, early healthy would had well. those the both going trends space the the

That's Thank very much. helpful. you so

welcome. You're

The KeyBanc from comes of next Capital Markets. Todd question Thomas

Vaidya This the please is should can are cap the to you morning. the portfolio how X% 'XX? Ravi the couple ask Todd we for in sold in the share dispositions X% for I on the rate appropriate line rate sold 'XX was past you, of going standpoint? about that think from forward, of for modeling years run to good XQ assets about Hi, is a in Thomas. wanted quarter? XX And Over

is Cathy. start sold the X% to is that the ranges year. beginning portfolio with it This last during of normally Yes. the Yes, I'll question. balance X% of from

and a the as of through normal going our process part it. Just and of reviewing rebalancing portfolio

use well. appropriate for be X% if range to would as a X% So of you XXXX that kind of

We there And from don't Yes. is And basis. once annual Chris. a I'll year the say cap and an quarterly this that do we on basis. rates then, is a disclosure sale - And disclose it perspective, a then on because of are this so in 'XX we 'XX, 'XX we actively 'XX, selling for you from actually years. 'XX. for could probably too, And that and a put three the assets have sort by slides way does

peers in right, about good buying properties - reinvest four not at has that assets you sales $X.X worth most the one liquidity probably billion in recycle but been If of to the shows look addressing of of markets we've the are of years North which because been we assets, the four which those is also demonstrates cash every years' sold our got, pretty we've of into the new we've that done, only accretive. the single the has or ability

important. another ask than you higher at which we've rate it's XX buying selling rates getting So cap points assets, assets so of is been been we've than basis internal growth,

you there. And how so terms in math of do it gets for the we

that the have aren't lot For you wanting and the we about companies which peers sales, internal assets growth, showed - calls has other been marketplace. into XXXX, can been in first don't on we And and seeing buy it's done they've too and year a marketplace. in slide this recycle product there that the lot from been where deck, you've it's may and be liquidity losses, at we not talking scarcity we've in demand to where people tell of do but the many say. we are To-date, able opportunistic early of of a Mary you net we to that listening to have selling the to debt from assets,

for for rate and we've stuff so us rate of example stuff range year. that course restaurants five this the of we and And may having been annual offers people - five-cap make during for in sell cap the some

remains it the So same.

Okay, to for foot coverage trends great, you're other and on that any can assets? you seeing with And detail or regards offer rent any thanks. health gyms those traffic, clubs,

Mary. Yes. This is

they have, So membership Once when which fitness there's some to to we issues able California, so they a of open but of they're memberships they're talk when going as customers are the open. open, open. charge they know, U.S., most on, our you rest the now still model across center

been really helpful that's them. So for

actually be the with fire facility seen back that is people I signing can how around live I increased think people up capacity. there's new to fairly of stuff, and them get codes generally generous and memberships out motivated issues get dialogues but so We've having are back on the based constraints now their back. them, come to a actually begin it's many on we've been coming the very and seen don't been for the the actually and COVID, in time. are - couch a and capacity we've in think at are memberships people terms relatively. they've we're sitting had and life, so on memberships capacity some Definitely

coming that sort is performance very they portfolio generally and are of for players, national think those regional players, and they're us are back, actually sure. expected incentives seeing strong, telling I of good than Our as better the groups so what they're

it. color. appreciate Thanks I the for

Thank you.

Nate of The is next from Berenberg. question Crossett

Hey, hi, guys.

For $X talking or we rate cap then be in net X% chance off not? that? the lockdown, Are we billion XXXX think of would specifically? any we do what's And - your you the would helpful? if on regardless, there sales, north color the a the associated billion to of $X.X what you that, a with go volume, back of guys or can execute go that, kind on into be pipeline lockdown into the And impact

XXXX, pre-COVID. guidance the This at where that the acquisitions X.XX% Cathy. given Mary looking rates recall, we When cap we're rate back back mentioned, trend down beginning of for anticipating And is a had you pre-COVID. to they were as if we're year, of at cap

back trend there. we're would So it expecting

questions? You want - the to other talk to few

Yes.

through the it good living our that our COVID portfolio So now and well. Nate, - weathered is the has in news or seven benefit eight we've months of really has of had is,

which wouldn't see. how would you but we through global global see I to anticipate can we happening lockdown, were the any So perform basis, able that did new say, we on a lockdown

imagine to in stuff have we creeping an are monitoring that of follow actually to - are restaurants test statistic volume daily open that although to terms and rates will they everything can that perspective, on from so from positive restaurants of we table they we business. And mobility case rates, people and you up volatile, are say and

world's the masks hand-washing and - between we're So and social adapting. distancing

adaptive life. we're things that very imagine, happen to all can you As in

would just our our and well. performed really I fine, have perform of so as as I'm actually the pipeline proud has we've and months And COVID, got eight in through how will say portfolio past

deck In that closure in clubs. Today a Phoenix even our a that some have here experience, was Arizona. Nate, been like world If look And of of they of opened. lot issues our shape. all these it's market zero And in today in a and that this per a October were seen we're terms in are - ground or shutting where some Paso We Mary's of there not comments other just point while, regions that regional-by-regional the be basis, the in and we even California. for fitness reflect the and XXX,XXX today, seeing any fitness on In of we've is COVID of to entire clubs we're as been would spots El sort so. of - impact we're XXnd. course, Arizona this the also of on are - stuff shutdowns are course people cases down at hot portfolio much we for course better slides there had state-by-state

per sensitive many. our in So XXX,XXX They there than not they but XX not relative that that properties areas in highly of are XX% COVID. more industries current, cases could even immediately are to is you are see people, where which is

feel multiple states. of that And about would think point is other XX% are about out I the where issues. can right our thing across so - we it's and operate the we tenants course of pretty we today, So confident withstand that I

And so strong markets able because they states, national be to in they're other and players down they multiple operate were too. across if operating and one regional shuts market

Okay.

curious there? the Worst-case movie Just there on used the theaters. ones for portfolio? any other Are in cases scenario

Say What question? that movie again theaters. was for the the

worst yes, used trying to don't Are about industrial just Just, I assets, scenario. know worst case. Just think other cases case distribution? maybe the those there for or

Yes.

are be they for sure, generic used buildings... things pretty other there. for can They as Yes well sure. Yes,

used this and last theater Amazon for We a sold _ it's being quarter

Distribution, yes.

exposure the uses us not are for But so that the exposure, them. X.X% There an say first would theaters A, first place. yes. are So all, other I of is of in answer you, for big to

And Secondly, things the we screen because feel we that in the get in know revenues pretty just we $XX business billion XXXX. movie theater what $XX are can't billion. all all did most the we And in you reporting third, numbers and theaters end own. level confident

to just not So happen. going it's

movie in is average a $X our really it. studio's theater. the investment And like theaters million finally, need So

been So amount really lot spent of judicious location-by-location in - I the a for to very money basis. we're for screen. or theater we've for not lot a as on mean, we've

like too. And It's in product there isn't them. there that enough to getting out actually product Nate,

So they're open.

Yes.

Or over but and - products. over are XX% are need if open, ours some you got they - open of much

Yes.

going those theaters I so where to I comfortable get so what - and mean one and it So I XXX% movie theaters I Tenet to collection million experiment if rate some did right was back Tenet, of during States, COVID. so will United means so of some a candidly which I the - mean up that. there's people there's just of is there it's In guess Industries mean are in - look Europe, you're are an industries of it's it like which there how feel mean revenues. probably you to opened and can in a it's think do kind the terms bleed about at normal not - as you're that it I they a $XXX going disappointment go be is, to there away. so. at going to nothing just vaccine. not until you

thank you. Okay,

last Ladenburg Thalmann. question John come of from will Massocca the And

morning. Good

Good morning.

Good morning.

they cash of maybe are interested are touching maybe how the some accruing about accounting other little more. basis? of Just be should How doing I bit reserves and those on the So given we rent of at are mean, on is accounting those bucket a different peers theaters on that most think point? to I receivable would perspective? where this maybe know terms a where in cash

Hi, Cathy. this is

that. payments like process we do is or they're agreed who And we it as put determine and through a related making whether So cash things and on not have to accounting. go to normally would

that Importantly, tenants. our the statements as where internal charge really they here the led pivoted into pandemic, we receive monitoring group immediately credit each quarterly team the we the the went our for and of group financial was

So they particular industry the deferrals were the have, we to and very created what would position, they that what tailored industry were that challenges tenant. well understood of in, tenants' all financial that

everyone. words, had - So deferral In by one. them. a we There Every one fits just - other single-tenant had rent it own a one put it we their and that was just it program unique program had on wasn't like

resolved. trigger who you to And program them not tenants we accordance be move to in some we And cash put resolution, so have very very, if came cash would resolution, one had would few they paying that to where no paying if on that weren't and we we But that accounting. accounting. not because them that were where no small also had we group are was tenants with very had

I hope mean, helps. that I So

Yes.

the much that of able the so as all think big quarter last this the is resolutions And one tenants we the the way with by I defer through is quarter. that where ratio needed of same were things And XX% STORE reach last stands to out documented agreements. pretty that to

to I really that an XX% you able you - know. is that accrue you're where all XX% the have account, have perspective, for don't accrue. can can't mean And means what you can't stuff of then from accounting on don't understand you accrue, what kind that resolution you you and So right? you cash

unless we for anything any have And document a it. so done accruals behind we've not

Can does get just areas, how that kind bucket either you three me tell guess? I of those sliced between

areas? three Which

reason other you've and accounting accounting, come and on therefore cash them to resolution therefore some rent? I Well, haven't who and cash a the thinking, was you're to an people on who that are accruing people with agreement come for people

Right.

the accounting. so always vacancies certain are - have then that the book in you have - guys people work every process, Those have Then happen on of have if you So have with, that resolutions accounting. a those people - finally, receivable. are against the we you you book all resolution any and there if number you you you people day. they're the don't And cash people basically off have receivables have on-cash reserve

to reserve. trying booking you receivable be you're can't on a because without book that a conservative So

can't we you a the where revenue but right with Right. because the structured, And have of away. there resolutions resolution are way recall someone that scenarios the really report

or those they were pay until if rents rents percentage report due. had to percentage they over something, threshold going rents example percentage their for that got the wouldn't were So someone you where

XXXX. And that somebody might been gave I a all you off were can't have some pay now. obviously, during month Well September percentage of where to report them in you going revenue and they rent say

would bucket. somebody So example would of that they who an be be in

seeing flowing is And rent that that number? through if all of of I it X.X%, it haircut X.X% of of actually or think terms guess different listed revenue kind Okay. way. that maybe theaters, top I what's I line is a how base a about Is in that is much in just there today? mean,

No there would be a haircut right.

unresolved Yes, agreements against and deferrals, deferrals. have Today, mentioned, all our we have if have of the but reserved we deferrals So have Chris have as theaters, we theaters any. would very we few with we

for so gave And great collections virtually we a because you then is you being everything we that, today some in but see this rent the theaters basically XX% you it's it's the you've have got have right October what open, is that were our a of So and reason example. charts XX% -

is and We opened have chart. only of a It's collection, that's there. in a our but rent like XX% theaters number

on XX% deferral Yes, have agreed their that based right they agreement it's it's and, upon And us and right yes... with agreed. an but

you than is. rent we've is the what of are of idea what there and And an collection right. sectors the certain sort It's give sector

collections structured us the of today, honestly, at STORE if function you that X.X%. transaction you the at stuck a ago have we so and Arbitron but investment around of at more is actually I collection where is struck around yield going into were we're let's to company are that mean really marketplace rent XX%. afford their that look thing a is a to tenants at rent investment and on right some the deal, mean, our our cool deal XX%, sometimes high people but X% I pay rent can grade we get investment we're the the And XX%, to thing, months there on is with people. or say average of as the not yields

are than right. more more X%, So like X% theirs we're

and that means are means not collecting that than for that they then, a those they're our then two their we're up collections and between invested, in collecting is they're you rate, of we we're invest. every there we collecting end grade we're lot they're dollar for investment typically collecting non-investment less more collecting gap because so with a point spread every right many how of have the in dollar dollars wider of - And basis and rent even so XXX% their a XXX terms

performing And so return I adjusted there that's where key. how that. you're so at this is you're terms and looking generating through on is of a Because risk important stores of rate chart think in pandemic really

so to describes and groups have by and have compares that out peer a we tenants And us grade stand investment they that that well. our really that chart dominated are

reason core other want staying opportunities, kind larger a as but some are sustain whatever from of some differentiated place on then And into side, them, mean the there under square can think environment? impacted... a these other kind for get you type investment yields maybe a And of higher you be I is earlier. of comments competitive the COVID I competitors made are understood. these level can maybe we properties investment the differentiated Okay, just more for where any property some of are away seeing thesis of is you where more foot where maybe maybe that maybe

good If know, ratings. an analyst John, right. you a would I you as analyst of they're we, buy rates like whole that's But thing is, it's to a kind say probably

So people sometimes. buy stuff at the wrong time

the have where recommendations buy XX% XX% time we're we've been AFFO or multiple. low multiples a stores the So at AFFO a most trading were and trading

And a used really going perform you and them stuff they of of where out big that, you cheaper. you of real you're certain the right. some the which that are after back buyers behind generation But at businesses means can less in favor lot and attractive can of areas have that estate We basically you out be can are get have market if you if well. really have box course, too envelope peel in businesses second then the

where we today there so stand think can And chances that interesting are that us make the investments some really you with will time. like

Yes. processes just this And hasn't our real changed, right. Hey, John, is quick, but I Mary, agree.

We estate. peer profit have real process playing where a very disciplined center

keeping so we're on Our very there always to is a stakes directly very making as had disciplined all team and in out and disciplined way I investments we customers calling on. underwriting, table and know our

need Chris running disruption to So there long opportunities our times are are here I of that business are would say of but in market the of and term we we all for line in and that and disciplined is how building be bottom that, there the correct it. we mindful we are very is consistent

our question-and-answer now over would to concludes back conference This any session. to like the closing remarks. turn Chris Volk, for I

And call today. the everyone thanks thanks, for attending

virtually you But be few the non-deal we're you've during always for a we year, on lot of and any given working planning We're events. conference roadshows. of seeing Cathy Mary, around I remainder that So going are during to periodic normally not remotely. that questions got a as we're the follow-up conducting would

call let REIT know. Otherwise be So you we outreach, include And have and and meeting a if week you if so of want presentations to be great or and you very in leaders this virtual November again, day. STORE XXth that's the be to thank into at non-deal attending. And much scheduled meanwhile our STORE investor included free on other us plan in just feel XXth. for may three And interested are leaders us. to going to roadshows us

Thank conference today's The now you. has for attending you all presentation. concluded. Thank

your Have disconnect lines. You a may day. great now