Store Capital (STOR) 6 May 212021 Q1 Earnings call transcript

Good day and welcome to the STORE Capital First Quarter 2021 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Lisa Mueller of Investor Relations. Please go ahead.

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

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

not Forward-looking expected guidance expect, statements other statements. phrases. for our comparable dispositions such as identified are as forward-looking words and or share anticipate fact, about statements will, historical be, acquisition, AFFO such our or XXXX by intend, per words also believe, that are are Statements

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

thank Lisa. for Thank morning, joining and you, you everyone Good us today.

grateful XX been Store. express over all Before the be for I of together. and we discussing years support results, our Chris CEO I that have want also I the am for how to quarter encouragement like to would to the personally his Volk past working first opportunity thank

Long, will would of of days and Executive Financial of in new Many prior confidence Tyler our With Craig and Management, with our our participating Executive collaborate other be Cathy President to platform. of our Portfolio also I role their Craig have in you Acquisitions. and our of have They as been at met here inception already Vice are board meetings. and since and opportunity of Officer; also other President the Underwriting Fortunately, leaders at Vice at upcoming to Barnett, closely I forward more Chief and me will our to road his and and part we're They for you today support. entire Maertz, and going like thank will have see investor industry Chairman. and both strong directors our and shows. Tyler work them Chris earnings conferences deal continue and Store on Store calls investor

to now XXXX and extraordinary our of at XXXX Well, team customers, moving is a enthusiastically business resiliency good to our off forward start. an and hand. are very Turning model, the was year proved business tested and we our that the

quarter an with XX We of million our diverse quarter strategy, and we and XXX across closed added invested million size relationships. During average with approximately $XX an X.X%. average customers lease escalations the of cap X.X% at first more with new $XXX transaction acquisitions granular of rate different customer the quarter annual weighted attractive than XX Consistent industries. with were

with near no long have we term and lease lease term quarter originate our XX leases years, the to continue We for term virtually weighted expirations. at average

with occupancy only end properties continues be at high to XX.X% of the quarter. Our the XX at vacant

contracts. certain approach our disciplined table superior to know you estate on to real lease As ensure acquisitions stakes focuses

spreads going add historic remain as cost made to results cost or attractive All investments debt at XX% when in our below annual returns and our escalations. and first continued you and were the gross our of lows. at lease rate cap quarter nearly This at yields of replacement nice

strong our customers financial on financial and health on the are year investment in growing reporting level unit all focused board, re-energized the their and quarter. unit the opportunities. a attractive leases our we confidence acquisitions master in among are multi of seeing businesses. received customers and and prospects on Overall, growing also new We Across transactions entered pipeline

how with to extremely customer an model margins a underwriting, balance include We a with which our pleased has strong well sheet approach compelling of shutdown. selective and performed value designed customers, a diversified safety was and with of business unprecedented proposition flexibility. margins relationships and These our highly disciplined and close granular have a portfolio, financing been safety economic to

has inflection scale Store team the to of lead phase believe to My important built our through opportunity. to next and portfolio we talented more $XX As priority team real and at of and been dynamic one have the is than success. of professionals. my our Developing a is XXX to the a nearly the top platform point a company result, we of continue and an leverage growth outstanding of career leading billion highlights and estate Store at industry Today, team Store. has

national industry shareholders of industries regional now to attractive in like would Craig. to as and deliver And As priorities call vital building returns generation is of our highest next we of market I the I to look to forward ahead. leading serve customers opportunity and my to CEO turn continue leaders. our the over one large the

provide today. built to few we going Since properties. portfolio. Thank in you, update to granular Mary. minutes X,XXX portfolio have today industries and our call to a a great It's purpose participate an and includes I'm XXX diversified inception, on that with our the take

account the who retail than and Education of approximately for top of customers were experiential end XX% our is XX% portfolio of industries, interest rent for interest. first More accounted a There counting shifts our for of X% service significant quarter base just and quarter. the to and than top mix XX% first less portfolio of interest. no XX customers XX% the our remained written base is customer under in just largest bas collectively XX X% manufacturing. our rent XX% Spring our of and customers of individually As comprised

our to actively continue We manage portfolio.

demand disposition activity in quarter driven pent First COVID. up by resulted robust was during which

sold cost. were these quarter, total a gain properties property sales our $XXX opportunistic During breakeven recovery XX% cost. resulted sales sales our of acquisition part XX of and XX of XX% we million. a strategic had in ongoing were original activities management Two over which compared in Remaining are costs. and the a and were resulted cost of with

Turning this to first factors. success proud cash and collections, our month our percent for moving extremely for XX% the collections quarter several the We're of contractual steady collections of important XX% in attribute to at to of April. held

our the diversity First, of portfolio.

agreements. deliberately tenants that are RV and industries by of furnishings, impacted recreation, COVID outdoor benefited direct our such of in a XXX diversified As as portfolio services, many serve result COVID Most were from our a vet industries and we medical highly in of need rental the of handful sales, coverage proven last only home unit evident times were as charge therefore up level and resistance, fixed are quarter the in to benefits at which end of others quarter, portfolio was such tenants. pre-COVID manufacturing essential diversified and with X.X consistent our COVID from the maintaining X.X also be times ratio, The a levels. first of and

real and us with positive portfolio level decisions. underestimated. Second, make and the our time cannot the trends time a infrastructure difference. like that communications in to systems best rapidly and In to made profit tenant be credit decisions statement and this Taking loss review and a collection unit allows of information management performance tenant altogether really benefit situation constant COVID evolving real analyze informs of together the corporate

operations, to have future their shut business we outlook. on with Third, customers of them down and relationships and directly work strong events, profile, liquidity impact our adverse with the understand such as

them, During COVID this effectively deferral enabled for that our who Store work stakeholders. tailor needed to short term us them, agreements tenants for and would arrangements

As to none being we correlation a closed be are open to our tailwind collections. locations today, since of mandated there and are rent of is between seeing in our properties direct and collections,

out. We completely COVID continue are restrictions expect are this to further vaccines lifted and as rolled

trends businesses are about telling and customers us optimistic in positive they their are seeing are XXXX. Our

And I'll Cathy our to results. so call are to financial turn now discuss we. the over

Craig. the XXXX. review and financial an on for our Then our for results markets sheet activity. I'll followed first I'll by quarter update guidance capital our you, balance discuss Thank

which the Our XX% from $X.X from quarter’s million leases. the acquisition revenue only first back included of revenues QX $XXX represented About end acquisitions full in Sequentially, net by The revenue year portfolio. revenues of which primarily revenues scheduled increase COVID estate acquisitions reserved quarter, quarter on were from in impacted was real escalations weighted. related from and activity remaining increased of QX. quarter previously rent from from recoveries portion increased and a growth X.X% the higher increase a to receivables, million mix ago first small our a

in $X the first million, down from quarter fourth deferrals rent about the totaled quarter. net $X million During

to the of cumulative receivables clubs. in rent deferrals less to-date, XX% our earnest already of end theaters, reopen; rent at million the million number limited and a to the beginning receivables that provided were entertainment deferrals million. had COVID COVID less slower of few $XX At in industries quarter's represents This since in approximately been family $XX of $XX health tenants of who quarter to by pandemic, net and quarter of about collected we over in are repayments have Rent stood deferrals This of and deferral be XXXX. the Over repayments scheduled end tenants fourth XXXX them. the the million. began half collected the just be to reserves of completely $XX current XX% received by end repaid expect namely

$XXX,XXX over our the was expenses. notes big our Interest this costs ago million November. X.X%. from from Sequentially, of downs first a to due rate increase weighted issuance from decreased The from quarter, to for by proceeds million, costs the improvement by in the last year a senior QX. to interest just made debt $X.X to paid third we increased decreased quarter $X.X turning with property million. primarily of unsecured $X.X public which reduction Now expense average year-over-year transaction, resulted X.X% offset Property

points ago quarter. were earned expected year from compensation. term related tenants, are $X.X that totaled basis compensation due for million our based of points million that earned the based costs those gross as the of recognize that last reimbursed by G&A due was about do average performance increased expense year be primarily long non-cash portfolio include about to expenses impact expense QX the compared of awards. to incentive of we period basis year the awards a the basis pandemic. and on stock XX expense longer expenses no to Excluding recognition XX stock timing points our to costs ago ago $XX In to XX of in quarter, property quarter, certain

volatility, expenses compensation were this year-over-year. consistent Excluding expenses relatively overall G&A

G&A compensation ago. As portfolio the was the excluding XX percentage of XX lower average points a slightly assets which basis impact year expense than of is non-cash points a equity basis

AFFO versus revenues higher $X.XX shareholders an per and on provision, ago. to aggregate from Sequentially, million recognized $X.X acquisitions likely share, a provision XX. was a $X.XX we On and $XXX receivables ago. million primarily an sell. we're which quarter $X XXXX million of million record million per declared QX costs. increased on AFFO loans impairment April diluted the our to for per $X.X from properties to share $XXX During of property first $X.XX $X.XX recognized year paid increased a dividend quarter We of March in a lower XX to share on the impairment aggregate on in which QX portfolio to due net AFFO and financing $X.XX basis, from year includes quarter first we

steadily payout dividend COVID the impacts has the of pass. decreasing as pandemic Our ratio been

ability payout strategically We internally tenant add ratio in aimed XXXX. generated rent collections continued reductions dividend For in to robust get maintain With only for XX%. expectations the in deferrals better internal rents conservative growth. order to our our we a and April, to XX% of quarter and to approximated retain our guard to cash expect it in

AFFO from activity quarter, our operations, the the Now and of million quarter sheet. from visible proceeds acquisitions sales, in majority first and the QX. through equity later of our funded from program. proceeds will closed impacts turning with full be to ATM in asset $XXX balance our at cash We the beginning Since sale acquisition acquisitions cash

years, approximately ATM the rate maturity a of $XX.XX of share, price of million program $X.X common of an During term million. billion X.X issue average shares about XX, X.X%. March the X.X stock $XXX At a at first of long interest average weighted net equity to debt, used we had weighted average quarter of we with and proceeds raising per

cost at net remains expense unencumbered times. basis. portfolio leverage XX% level XX% our unencumbered estate on gross NOI of interest historically exceptional seven a of to to a was portfolio Our remains our low real debt at ratio and of unencumbered Approximately

At notes funding they weighted XXXX. maturities opportunity series of a giving debt And significant without notes no until and have have to XX of three continue during prepayment X.XX% average become end window pipeline. credit $XXX year. a available find an available our interest bear will accordion facility rate penalty our month master prepayment this costs We million an at XXXX. $XXX to million for us March, These well-positioned of ATM debt in the million under full cash, in feature. and reduce program We're which the acquisitions $XXX approximately we $XXX has also had access to million to

to Now guidance. turning

our Given we're this net to rates. of in sales net at the cap is volume be the remain to AFFO our based projected expect We guidance announced $X.XX acquisition strong on XXXX pipeline attractive anticipated which in to of of volume. currently acquisition opportunities, of per we billion, We billion range projected share XXXX $X February. the approximately acquisition $X.X achieve reaffirming ability confident to in $X.XX

a acquisitions of X of on X.X debt Our and rate target times cap the is run ratio AFFO based guidance a EBITDA. in new on rate times net X.X% leverage average weighted range to to

to compensation Our per AFFO straight guidance real of share $X.XX plus share, and or estate as to for plus and equity XXXX of property financing per $X.XX per $X.XX income cost items $X.XX rents, amortization. deferred related amortization, expected excluding depreciation anticipated share losses share to gains approximately line net reflects on such sales $X.XX per

year As back turn guidance as will I'll always continue And reassess call Mary. we now to the to the progresses.

Thank you, Cathy.

I'm second call corporate will that weeks. tell responsibility happy in Before up annual you we report our we open issuing few questions, be a the to to

and of and leading team world to better to will we a a dedicated active contribution ESG on believe ways living We a executing more has Our exploring been to by place in over managing very We to a contribute the big success each thank an environment. sustainable hard behalf that challenging of support importance who here make and that, all all up on new social questions. to and relationships day our the and the of storm of to focused to the stakeholder my principles the work year. their responsibility partnering stakeholders approach many our attribute both good on will call for many colleagues commitment. incredibly all on are time. of creating to corporate the in much and responsibility The committed COVID I and operator continued our every highlighted With and our company. to want customer and are and for programs I with weathering of stakeholders each closely turn the of corporate pandemic direct initiatives building and benefits

will the Please come question The We ahead. Frank session. from begin Instructions] with now will question BMO. first answer [Operator go Lee and

promotion. Congrats, Mary good everyone. Hi, for morning,

Thank you Frank.

Yes.

your the on would new Now you on how can that you run in the role, transition talk you maybe how a about you'll versus changes like to investment be side involved company previous to and role? the

You happy address bet. Frank to that.

very actually listening now. important and at we're we're as building for platform to that. be And opportunities. in we're much aspect founder, we been all new CEO, believe actually of involved listen years really a in that now. going right open to going inflection a every been my point I've role to very So this as We've And XX and

So assets. on granular, we're and center going focused to to diverse stay continue disciplined profit

come through well. mean net platform. well. the By a really largely that have and performed we the we While And the pandemic space scale inflection I fact point, really is to has portfolio's what continue performed triple global in

are see in of through I'd and and inflection this this, a to have great continue been great to returns to very won't attractive been you point for model this I've going an the access here us going where So at a large we we're yields whole nutshell, time lot changes. this say building to to we capital marketplace a shareholders. get think scale we're this to believe we greater the worked. and will our opportunity but to pandemic And even business continue give serve platform. we've where

activity side on This being of some in look sales forward Are second managing Okay, then. million. great. Is we plan know pulling more closer talked slower row about of the the year? last some where I quarter this you And from exceeded came your taking at you a year. is of you exposures? last a XXX dispositions disposition Thanks.

to going that you is one with Craig help Frank. Yes.

Yes. Sure.

So some sense of it was buyers. from related some are the just to quarter of this due into pulling demand to, XXXX by dispositions of driven

Jason be will from next Wells Fargo. The question of [indiscernible]

Yes.

QX where weighted. two mentioned acquisitions in end the back You

Just can wondering can hit for us run in there revenue portion that we if portion what of those you assume, purposes, a modeling QX? rate we little give can what color assume more

Jason, this Cathy. is Hi,

March, three were in weighted. And was quarters March March. of say it heavily to I So want it

helpful. on maybe if a up wondering any you. That's have who And just and up standpoint you might it. acquisition what any elevated creeping your Thank inflation market terms investment touch seeing touch a against could things picked that? and pipeline, more up lease then opportunities you you or you're the going if on little from we that's bit, with sectors could just and whether outlook in changes might in activity competitive be Got are like all changes more

Jason, that. Hi, touch and will is Tyler I on this

is the XX% of pipeline of the pipeline of each sourcing. and seeing really the our continues to and definitely about pleased with which XX%, traditional excited all, We're pick velocity of retail manufacturing, end our first of we're terms in in front pipeline that mix from originations XX:XX:XX a So that pipeline up. kind of team our service,

expand begin continues to up pent to M&A and As allowing Does we're about relationships. is find their opportunities, us question? pipeline activity to third our repeat as with our team with our probably on yields. attractive And execute a volume answer of you opportunities with customers partner our see that to of starting know, And them customers. your

very Thank much. does. It you

Sachs. The comes from of Please ahead. Goldman next question go Caitlin Burrows

guess I if I back. pick morning. quarter just net the X.X a billion similar wondering acquisition what over but rest the in maybe up once about acquisition came you the past. But you the the on of volume maintained at good expected seen of course just Hi, to we've could [indiscernible] in of know guidance year, the acquisition the

-- will Hey think Caitlin, to Tyler going this it's and the to add nice that from hear front Cathy piece you. very of to take I

Net volume?

Yes.

Yes. Sure.

So Caitlin, of quarter million Store. history our line in our our acquisitions of $XXX with over first average was

our earlier, amount As have in opportunities tailored million. pipeline be mentioned as on front that continues an which sales, timing customers. from Craig And and and did transactions by is new up totaling new we the from strategic end can be they demand customers to velocity robust $XXX existing dispositions unusually was such, seeing a identifying both focused pent of we're large and lumpy of but buyers. with standpoint, the those create QX, timing were We driven amongst increased

QX Yes, and biggest QX Caitlin, this either biggest oftentimes being QX quarter being quarter. is Cathy. or QX, the always second is the with Traditionally,

I same that see kind of to continue. cadence So going we're think probably

X Yes. cost versus it. then history And to debt low this [Technical based EBITDA Got portfolio Okay, Difficulty] mentioned X.X it maybe to times was you Cathy year mentioned. you think I [indiscernible] that

looking could ATM quarter? EBITDA pick that that activity is equity the decide metric guess, you you I issue in in up the at via you quarter much think So second do and the how are

were quite there. you a Caitlin, breaking Hi up bit

talking you I one question. know I hear more the about the leverage. you didn't say So Can were whole time? question

EBITDA in in second active the was think now debt second more quarter ATM is you in to is just terms the with asking deciding of I quarter? active how the Yes.

on our we'll stay normal think cadence. I

of to run high. unusually it that If that recognition the to basis. X.X the affect though in comp of that AFFO we look stock it's Part debt that at a rate related the had on expense is part EBITDA. comp, stock quarter you EBITDA Because doesn't affect does was

at a that made, funded right debt the times catch end that, X.X If low we're at we adjustment our to which sort you exclude target. of EBITDA, of is up

question. think I So that normal your cadence if on answers we'll stay

that for Thanks clarification. does. It

next Bin will from Kim be The Ki of question SunTrust.

morning. Hi, good

that for, get morning congratulations and Mary. didn't I good So

Thank you.

Do went run you that quarter? million last this million exchange. explain $XXX just for or EBITDA to [indiscernible] why rate from quarter $XXX

Yes.

we a What G&A you'll this this swing is from year there's So expense notice Cathy. quarter-over-quarter. have in

actually So if exclude non-cash to is down. you G&A flat comp

So recognition these the really of timing is awards. performance see to change based expense there that due you equity the of

we year of on pandemic. by awards based million recall, expense for If the the non-cash would GAAP earned probability. a plus de-recognized you of ago de-recognition the to XXXX, again, that forward And requires that reinstated we be $X.X the QX, to as be current GAAP. pulling in expense accrual weren't required then due of period that quarter, expected portion impact And

tied growth shareholder have Our plans return. to a portion most to is significant awards while have relative absolute AFFO tied others

AFFO results, given So awards the the only that on of tied that the impact the to was portion to committee adjust metrics. pandemic our realigned absolute XXXX

the So there. change that's

If up exclude sort you would catch mean that on cadence. a from the EBITDA from of back AFFO, was it because be where calculation normal I you

debt to X.X. run forward going funded rate, that Does help? EBITDA would So be

that. thank Thank you Yes, for you.

question the over expect we to is for the there is how anything should terms things that second for long thinking about of the in looking the spot that incremental, haul? buy sweet you're you're So what Mary,

to granular real estate. many our classes asset focused we're across Bi, stick really going diverse portfolio and profit to center Ki on

we're going stay to So there.

answer to And us mentioned result, we here point do I see in is we're the first proven. and this think really means inflection model come And Frank, for to the market. as that to what at having large expecting access serve capital interesting we're this a that As largely even an pandemic. is business I with greater would, through

pandemic. net really in So even the triple well did space the

the here showcasing I'm that. to-date. about team excited we're So

going they're So which leaders terrific. of generation here to they're next and in the build we're

think us a model pandemic And this. that business test the So really to scale that see you're we've, to the great passed. been going I has really has continue

Okay, thank you.

You are welcome.

of Hemnani Green Street. next from question is Harsh The

other your all compression different lease was a seeing little REIT. lease of REIT, market Thank been comments rate net net addressable you. the I than cap the wondering, is across we've

given So of you bit? from then it the seeing same I'm and too? down can rate the you're rates about if ticked cap cap just a yields And both talk wondering cross little the perspective

Cap and last I Harsh. the was part rate what sorry am

part bumps pump]. lease including was last like cross The yields [red like

yields, Gross gross [indiscernible]. returns

it going together. cap to is Tyler talk So and out round rates about can we

You bet.

there. Hey Sure.

this the attracted net X.X% we've market guided some as investors has a pandemic the is companies. that base from compared with we've larger why rates serve we that roughly definitely put on yes And large the of cap has triple consists resilience continue to attention companies for X.X% the cap So rate seeing marketplace. we the yield. very been this as of competition search to sector increased And And in XXX,XXX pressure to and year. year last middle estimated which that

our end team granular has earn truly rate. continue in this add plenty niche So value origination And huge we're of to it's market cap market. our front a in attractive customers seen opportunities to and

prospects. as that, to the escalation. this directly Mary that would result asking a lot out customers and team for our of And add sales cap rate originate we is there and asking really with Yes. just a is of I and for the that

So own form and incentive their here do that. our to we're creating lease

the market that. tend And And to to than model. direct We compress huge. origination going from that's business we're continue just less So business, a the is very to a do marketplace.

But to pressure this seeing I doing in So we decided rates on are and space. keep that. cap competition

you. Thank good. That's

welcome. are You

from is ISI. McGrath Sheila Evercore of question next The

clarify volatility Cathy, the morning. if you again in G&A. was I Good Yes. wondering could

stock why a weak might little be headline the the think I today. numbers bit

target. a a but -- So not it because that was what comp stock because price it of was Is the change in of driven by? performance

shareholder their to relative have people tied plans more Where return.

everyone's happens, the gets the same in when everyone So, boat. hit, pandemic

have better than doing to next So well, just are relatively about you you the person. worry

We portion plan our our just also growth. of it it were. are that absolute way portion way. And matrix AFFO significant of But have that a a the works stay that

a three year, these it So, are and three there plans. year is

the on the basis. XXXX So, felt be pandemic an committee for absolute performance that the adjusted should

of be it but it'll then because did and year date. a not recognize up portion to it We a of I reinstate a as we'd that we're so, expense GAAP brought expense all And portion, for ago mean require. the

it's normal in So, you're catch up singing of not the QX, sort a cadence.

So, $XX the million like normal to $X.X And million. is quarter. $X.X got a million QX per cadence

the So, that's difference.

manufacturing. And your tenants experiential and where could just you. thank And you COVID I you in experiential let in prepared then, portfolio Okay, service release? may for the wondering that have of put in the category they Lis, think if where us I your the the requested majority into was know remarks buckets retail retail where

entertainment. was Yes. non-essential who in gyms COVID side classes. mean, actually for looking new not got or deferrals, and we're been in may family the the There's that that hit in asset additional be movie requested relief. theaters, asset non-essential one I long it or -- and essential it real the If Sheila, tenants really essential the customers any at now, was a time where remaining QX just having classes as

you. Okay great, thank

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

are what a sources tap. what And scale of you there additional or thanks. for referencing a you're Can point times. little talked at just Hi, about in what out capital to perhaps inflexion you eyeing of I'm number curious you describe Mary, bit an being other advantages more just detail? and you're

hey Well nice Todd, Yes. hear to you. from

So, of having business I really relative proven the I mentioned COVID. would is that to say inflection the point

and a into a lot pandemic in triple comes economic and space So, works through shutdown. business the seeing well. money a and space. we These of economic coming interest a net of are the lot And spaced are model complete it all global the

a and get market XX continue So, to be us and we cap these XXX and expect have XXX,XXX need and to we actually can companies get returns. are able would that customers interest we can in to great that years and runway. tap we can And we rates value add actually that where increase then into customers we have long attractive

that's So, we're what and we're for seeing that's something, Todd.

it. Got

how just necessarily the it's strategic relative nature thinking So, something you've of been terms investments. of an transformative to how It's in increased there. not or go business you're opportunity about conducting for in sort forward

Okay.

You mention and correct. we're got Midwest as then I well and here but got. be open you it, then mean already in know the yes you're let's I we're mean, open

be guess terms collections around of Okay. theaters begin today? fitness sight restaurants or centers then, last the rent that for I to just or question around of paying some collections. And improving in of have the or in Do line further might timing the you comments into lagging

theatre, Yes, a were. Chris on those give the little even color little movie you mentioned give XX improvement and can from also on a you you color the industries just

we're we reaching yes, COVID related collections fall then, businesses strive highly we've to to in April. normal that And capacity. impacted to off. returning obviously that pleased got XX get delta between deferral arrangements And extremely XXX, the to with the going is so are a And as as

Now to increase. we continue expect to collections

Thank Okay. you.

is next of Kamdem The from question Morgan Stanley. Ronald

Okay. Congrats, Mary.

Just ones. the couple on of quick

health, a are on collections, Maybe what bake half portfolio. the in the the you're there feeling talk that looking on just on of those guidance into First in what and tenant the lot of sort that collections year? tenants. basis Thanks. the better suggest think assumptions Maybe I health tenant like at you tenant were cash do about of end terms you of X% of the the commentary about could

Cathy, is take this that one. Hi, I'll

higher on if And maybe normal expected of paying quarter-over-quarter, X/Xrds X/Xrds have, So, to up about than in ramp were for And basis. year. is tenants, It's flat slightly they're currently little a model their to expected. we little show bucket for cash at people down. those rent. kind who we would have probably look of than of quicker we you cash the over our our about just That's it a a

we So, would ahead thought where of bit we're be. just we a

over to switching little bit just acquisition the then, a and and manufacturing. And sort in of helpful. being Right,

curious of more portfolio business terms type that into are that of all seeing net space, sourcing that piece gotten how that in sort you come what the be deals to do or other chasing competitive, sort it pretty after that is lease is product Just are more maybe similar space and sort industrials of think in has you the of different? this of people

around I'll Mary. then Cathy answer Long with and can this start

our centre profit with asset consistent So, class. our manufacturing is very

manufacturing industrial logistical sales where center imagine out would distribution P&L A There you this. of more Plenty more on. place other that there and that we all online to with Amazon are a be flavors of so manufacturing distributions. with going wouldn’t can So, or with related our has on and lot that play of are cost them. as a attached and

So, would the say for Tyler's network like just deal ever on other I transactions here calling the portion us here. our our working and is through our consistent and STORE's out customers team the for is broker of like where with directly portfolio as and a goes we're we're source well manufacturing very

for same and So, approach us, pure use manufacturing. the us contract it profit centre a but for our focus is

of seeing. of add That's about just consistent been earlier of net based We've manufacturing other just rate kind the would that part kind actually the I across triple the part comments that And resilience we're some right. cap during the that Yes, what has your world. and you're my been been question. pressure of pandemic side leaving

again, Congrats thanks Okay. Chris.

Thank you.

from question Haendel next The comes St.

Mizuho. of Juste

Hey, there. good morning out

Haendel, are you? Hi, how

And and congratulations Greg Mary Tyler. to to also and you

STORE ask in the what about well Chris -- First involvement forward. question, going Volk's are

haven’t is We his this call in heard which odd. voice bit all at a

involvement level of if of status intentional offer engagement within since you going can this obviously. update on his Thank the of we of forward. that's the should or curious company more the search. CFO the And what Given you. perhaps reflective expect I'm founding

this Yes, Mary. is

Chris of remarks, is my so very here Chairman the He's very had day. he's of I Chris the employee on team. AK company my and actually releases was all an a said Executive he's Chairman in much So, has the engaged. and key much the -- and obviously is is he's he's the had he and really press the every And in he's the actually seen you've

So, sure. he's actually important much course. CFO all and And part of an bus very him be for for our engaged of working also closely with search. on And we're

doing and timing to without as summer she job a CFO on really candidates. very be we're engaged smooth freight wouldn’t around feel planned. qualified transition a us for being that great committed said, of that. Cathy delivering the track But Russell search we here doing mid-to-late So, the know And Reynolds leave she to they've is been we for a as very of and well, and you is being

good plan. shape in right on there we're So, and we're

back the you Okay, thanks boxes guess, for serving the rent on are Loves the how compare that. in us kind rents. Can prior new the of formal with seem you also low. and I the XQ update where versus perhaps XX% recoveries of

if Loves And the also collections. And at disposition rent of all. mix was XQ helped asset the bucket, by in sales boxes so overall I'm Thanks. the the with I curious that curious was the assets skewed

Yes.

it will XX% quarter address and will to and going not update point. he'll by you impacted give Craig, just the was on So Loves an which you recovery tell Loves was a

he'll that. So, talk about

Craig? that, start You want to with

Sure.

beginning So, Loves the the you properties They XX still in is at about can are what of I bankruptcy. had tell quarter. we

liquidated. some We are are is rent the receiving locations being

the be remaining We large of marketing But majority is we those like our Loves of trending sales were resolutions re-let well making resolutions location. were furniture are were seven as Van pending but furniture in they and With money. retailers. location. seven footprint of were the to those When doing all The the and open, core really to a Art will space they and aggressively. really

optimistic demand was as were of is that three of work loss we consistent the we higher across going Again property mix not, normal. asset rebalance in across is from and primarily the site. dispositions, we're over Casual that prior was outsized resolutions we're issue restaurants answer being good quarter was mix. buyers. an portion this have In The the But the pent-up an Loves slightly of cost categories some by your not strategic driven quarters. on regards question? classes the our industry sales many the Did portfolio. to to it So, the on than pretty the

Yes, that's XX% the it the experience. follow-up. talked curious I and stands we very where rebalancing from I'm a of what today helpful. Mary, of sneak if in portfolio teams about service could just

in market. the strong demand manufacturing and rest So, the in the

a more your aggressively take bit imprint a why that curious I'm have the you advantage quickly that on not would of perhaps otherwise? portfolio So, more bit of here to rebalance put more

-- we sorry Haendel. I'm And

more what? talking choices in or You're manufacturing side about rebalancing

overall. curious just I'm No,

the as the you skew charge a And running in the of trend demand company. you're at that, do see balancing think, bit in that marketplace you about market. in you thinking the that portfolio in the a you As look this and now also

be seeing. curious be Just you input if overall. or you're are And balance just Is of be done it's would on here bit there the our on any a Or put to going status quo. more inclined aggressive you this of more Thanks. on the the inclination to thinking you're portfolio. dispositions portfolio more to what curious or thinking demand here and

very I We today they're we're the a doing over very serve think we've diversity keep companies No, to and the during doing and been years. industries. underserved It's market part so to really last marketplace. Profits the of stick vital what that centres to profit Yes. address well larger XX close pandemic. going the going important which we're middle well us

and sort sell. make to industry of going we're them there stick the So, there. Haendel, we start But

the in manufacturing first XX% nearly acquisition. were we our So, of quarter

it come terms bump little us. opportunities the they -- So, of are a as what and into where then doesn't we'll in bit around

that us our stick are rates that’s really continue centre to get nice but with with bumped escalations. our to profit and lease important So, stakes real-estate, we continue marketplace the that table contracts to at to

shareholder can so, And returns. we continue to create great

and a us to to keep in our going game It's that's long focus. really a So, to space. runway be that for continue going long

Massocca The of next John question from Ladenburg Thalmann. is

congratulation, Mary. And morning. Good

Hi, thanks John.

and curious that's we maybe casual dining what bit. operating target and some restaurant a why your to just of dispositions made this properties the out that little began for in this there lives good some at the talking made about the just us those been current of as cycle new just the well stimulus was restaurant as thinking conditions, sale. maybe just Obviously component this for Give opening up So, asset a a are dispose kind with for those point-in-time? where big were good of I business. demand of to about

that. intended process. take I'll overall dispositions health the improve we entire to our are monitoring They're I portfolio. of mean, Craig, part of the

if looking financials reduce or statements that own of outlook maybe our record So, want we that and it the financial to. where to when markets trends that is construed an that might of had operator exposure side we [indiscernible] the located in. properties collect of the that they're we

mix. happened to casual heavily we And were or deciding of quarter enough particular was this So, want there to dispose restaurants that it heavily weight, is many factors of that bigger play that whether a so into just property. right the it portion weighted

we much We're Pretty like -- to. timing space. this down

at that experiential uncertainty still of seeing types of those time it you're pricing more in I is interested out small or pandemic asset? relatively given types? deal follow-up, current decision kind what's of moment of gyms, those that in looking kind portion and assets just is property where the for the still in basis some and flow the there of today, very seems then, like you're just guess the cap And gave in a kind maybe that And Is Understood. long-term pipeline maybe of the rate the on going to that by and created pipeline. be entertainment

is John, Hey Tyler. this

is generally pipeline regard would dynamic. with the So, I say to the pipeline,

the that a being and and wide Our maintaining relationship acquisition serve opportunities on on of you like do range we really unique a pipeline. team one. With and to to prospect opportunities. and Mary every specific composition a execute this we can industries cap know go are profits real-estate sectors buying regard industries to There is earlier, deal driven to of we're and We the size overall a rates, we're opportunities the I play is the solutions mentioned finding identifying out earlier. our pure customer not and of Though, indicative as opportunities with [indiscernible] composition that fluctuations some also there. from necessarily definitely earlier of optimistic new but about but anything we're there the evolve definitely kind tailored arises and to we're beyond really of there's of small seeing kind timing sort that. not by said be the But we're the

much very I that. for Thanks, appreciate.

Crossett The next question Nate of is Berenberg. from

Mary. congrats Hi,

Nate. Thanks,

if And to expect already does also evolve on question we larger? comes How should had you size. curious from think what I and of larger, at. on any tenants. a terms XX% was the transactions. gets you maybe as actually deal and it I differences in that that maybe focus that guys But look was I'm the portfolio customer, flexible been lots mentioned still average customers. the A existing the more new as there granular understand you visiting of And I pipeline I if on answered can between pricing was get wondering one make but

Mary. first Well it's

So hey, Nate.

In much look of you the mean peel most end we're I everything in would terms going to a the here be pretty at stay can to pretty in I opportunities we but $XX billion of the day likely at everything we're large we going if we're marketplace our going stick granularity that. it and And on we're at going of say whether But look to would tend portfolio and we we that to and we're can all -- this and the that to back. be to do granular. when even pretty the transactions granular open

things our going look going to but for pipeline, are will would to out we're I of third but mainly there too. in everything definitely average What the getting say at we're terms our stick of the and to So, we business.

Yes.

existing fundamentals do and you're can rates customers say new every you I specific the is it's cap asking about generally we just think now tailor I and know to transaction. transaction the of think things in different and versus we the

you. Thank

is Capital of The One. next question from Chris Lucas

Mary, there. out morning, Good congratulation.

Chris. you, Thank

relates about negative think environment, a opportunity. more you set. PE Just questions. think home transaction PE. Having we've that to of active ton morning opportunity a I impact to deployment when how an private for money. going just your quick PE as a picking that cycle I'm curious taking so for to raised you the about is not is business, be PE two a how quick will the about or that a for was kind maybe this your by We found and we're positive businesses numbers you you And what announcement seeing that up, of Well, but as activity think

their add And to that Craig looking so And additive. been the find And and take in few of a almost I'll supporting building them. again, market even we scenario and transaction and in. our XXX we businesses business then we've really picking only they've here of COVID place been all and our do add customers. were our be PE firms. a have but And them strategy we're years. we most almost middle terms also that's the add larger during that. [indiscernible] can market at are I a really, They but actually They've something company missed with underwrite evolved customers the trends and in we metrics that's spaces. exit after and healthy big the PE would They it's a brick in in or on. by customers And we're brick to ensuring what help and seen. always This a and The in been stuffiness say in terms the when are value spots. XX come overall, when PE over and of things always business with for there lot and if good I've good and

You can selective. tell we've been really

So, really we'll pick customers, very our stocks been but and overall our us. that a part a a good of great is partner PE's customer for

quick but a And for you, just still then, Stock seal. hope. Thank had I great. Okay, question pretty that. I in a

it update not flush whether an give Just through was can or quarter or that second overhang completely through on coming you some quarter? and into the where is us

They're our that resolved properties add been being coming. all with Craig. had We and is a this of it's retained. bankruptcy So,

comes The Jefferies. Linda next Tsai of from question

Mary. congratulations and So,

Thank you, Linda.

had [indiscernible] a forward? quarter down bit just that the does one. and I one go in did quick trend How going how

Hi, this is Cathy.

towards cost able back expected trend be property We to to normal.

of Normal see of we're points. basis the is days. That's kind points and If basis X sort what you say annual basis XX recall to our from basis portfolio. you down of XX an to between points cost pre-pandemic on ranging of

most the we're than we'll pass expect up. would to less pandemic That starts have we picking here. So, that as property that cost

have. I all That's Thanks.

Thanks, Linda.

ISI. Evercore be And follow-up Sheila question of will the last a McGrath from

other be point was are managing agencies cycle the through an pool the over Could Yes. I pool. larger inflexion REITs view wondering terms in this rating pandemic? given this credit where just unsecured the versus could collateralize tested your bonds for unencumbered of the larger more more you because unencumbered

Right. people's And Mary been with minds. we It's after add and in great pandemic wants. haven’t well. but certainly to weigh that. she STORE take have tested as public in having really has Cathy, recession, as I far think I'll can like really think that the and thoughts think face the if go to things that expected I been But I some on performed to And tested, their the is in going portfolio Yes. ratings nobody

rating with them I time. Cathy we're contact agree with with Sheila, working on all with and the happy And agencies definitely her that. and to working we're

Great. Thank you.

you. Thank

this conference question answer and the I concludes our And any back to remarks. will to Mary session. turn now over like Fedewa for closing

for XXXX Thank your we you, In participating next and excited operator. today reiterate And STORE. in for interest our our the to and like just chapter for outlook thank you how are all for I'd in STORE. closing, call about

attractive the scale have managing, deliver now continue company. the we important team to we market and well to to the and returns inflexion where our to outstanding opportunity proven very we impact address model shareholders. are to at point COVID and forward the huge to positioned our look an leveraging business are We With

not June out Have to always, forward day. of May many hesitate seeing a REIT you look reach if additional please also answer great any We can and questions. to at do we in

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

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