Alpine Income Property Trust (PINE) 10 Feb 232022 Q4 Earnings call transcript

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Alpine fourth quarter 2022 earnings conference call. [Operator Instructions].

Joining us today are Mr. Matt Partridge, Chief Financial Officer, and Mr. Officer. Executive Chief Albright, John

At this over turn conference like I Mr. Matt would to begin. to Partridge. the time, Sir, please

everyone operating CEO results and for you call. With Alpine fourth and John is today conference and morning, our today quarter XXXX the Trust Income Albright. joining end year President, me for Property Good us thank

significantly undertake other Before our risks in securities disclosed detail no considered differ to filings. SEC are under from federal the the duty differ to comments could laws. results results and we greater in company’s from forward-looking the we begin, future update these company’s I’d like statements. in Factors statements, to actual remind discussed are today time-to-time that everyone that many Form and materially XX-K, actual expectations from XX-Q, The cause these of matters Form and statements may forward-looking

use, contain alpinereit.com. presentation, find non-GAAP financial can recent most You investor we our SEC and our reconciliations of release, earnings on website which reports, measures at

With that, the John. to over call I’ll now turn

net Thanks, nice the to recycling portfolio. finish continue year, we accretive as our our on execute reduce a We of retail quality leverage, and program, had overall to improve the Matt. lease asset

XX quality high well quarter, Walmart. we sporting first DICK'S grade Family remaining acquired come operating as the grade-rated grocery, at Tree, total, Home the Sporting fourth tenants Our Notably, goods, weighted of rents In million XXX% during weighted under$ including the of from a portfolio, in Dollar Goods, rate our Dollar, quarter home years. and X.X%, investment an well-performing seven the a sectors lease acquisitions and during for as emphasize Depot term tenants, strong X.X average improvement, in as average of demonstrating and with investment trends such acquired rating, dollar cap just stores. properties

the rate XX a XXXX, a of we with credit we the rents average going than the over X.X year properties years. term in tenants half remaining cap at during of investment the grade lease acquired acquisition people. million acquired are in weighted acquired million were just with weighted at over year average retail from MSAs $XXX lease rents XX% For a rating, X.X%, net full of and for of and more an

did either the adjusted offer terms, are cap assets, starting and environment. easily is of which start spite to ago, macroeconomic hedge provide rates higher work rates a point case cap because at resulting solid smaller grade-rated of compress those continued better the from a sectors, year. expectations, XXXX, price financed in in we in markets higher made decrease the higher to in rates see way or spread. XXXX, tighter tenants the cap listed bid starting in put and which more While we've strong assets maintained buyers to to they contributing for quality be in-demand move look in to aggressive of ask have returns is where a holding relatively interest our their they is were This assets conviction or a a to in as as start sale number market we're capital Sellers see properties against within with and months through rates, pricing to tenants investment high seen we the and in few we're more volatile risk inflation, see

Harris put had back moved the during The and during XXX resulted equity, the $X.X during sold nearly These against of we've Year-to-date, of because sold and of properties sold The exit leased priced Teeter. weighted better Aid, we felt asset Lots, or million, a tenant assets we increased the us while disposition recycling property moving sales of total impact a proceeds investment we've of attractively On return cap net of and office yield rate quarter. with provided able at the a that acquisition million started for we basis-point allowed our value of spread out been Rite to in capital us sold Freddy's dispositions redeployment for on cap a a some also to removing investment Custard, volume risk. average $XXX to of $XX weighted subsequent grade-rated quarter, million. total us. $XX properties generated X.X%, work as interest gains maximize market higher gains five Frozen the process properties rate remaining include we the to incremental Big disposition when where rates front, generating at and average the the and These of in we sales, drive XX year April, to approximately this at the in exposure. properties the X.X% million second even X.X%, last exit

of portfolio. lease vacant tenants of with acquisition acquisition, drive parcel organic no as we're we of optimistic property feet, quarter. a the sectors asset in and ascribed vacant year, XXX XX result of out lower million cautiously growth totaling for to time XXX% value Occupancy we the the the tick As but fourth We first existing square properties the end within a $X.X at consisted the rent our did operating can below within acquired States. a property in this as XX part portfolio of to

ratings. start see grow metrics the to in Dollar XX% our portfolio two Dollar earnings rents our Walgreens, total valuation high DICK'S environment. XXXX balance non-investment tenants identified the or annualized Goods uptick with higher stocks to allowing our we've to returns spreads nearly rating, continue continue the continuous which Dollar, liquidity, whom retailers the sheet, credit pricing positioned own joining now it's the quality a a top net parent of as to all we underlying number of into recycle we we'll for the of drive in to Family the our reflecting important increase will in in de-risked of and result plan a better quality We're with enter tenant to anticipate note garner our our as of continue outline call our number of Matt in to our on recycling. sheets continued throughout five balance as grade on equity as tenant, execution, a industry-leading grade-rated Lowe's, to stocks proceeds. investment to year of any from attractive that benefit valuation, of investment that tenants, asset of we of that coming base outperform a the details Since tenants XXXX all our properties last portfolio, attractive parallel peers, investment of and as of and We've our guidance but out mid-October, moment, Tree, think with is hopeful General, will Sporting grade consistency refinement multiple We carry we our shareholders. an of economic generate strong will approach market opportunistic the us redeployment real estate, do the our

performance to improved the I'll and Matt now turn balance our as call markets quarter as year, the XXXX sheet the activities’ to in guidance. talk about and capital well over our

XXXX. We net benefit includes approximately topline XXXX nearly and and to the and to to for $X.X the our period with external defeasance our remained $X.X investment management a as write-off annual accretive XX.X% and driven loan quarter to anticipate which in just fourth debt total when higher be XXXX, XXX spreads. decrease quarter differential per compared year mortgage. representing million. our a new rate the for from decrease AFFO, compared for XX% $X.XX XXXX, administrative XX% of the unamortized per XX.X%, secured is and million associated points. FFO of property of charge was reflecting the in expenses before in performance, extinguishment of million. quarter of manager, G&A equivalent asset fee Starting in percentage expenses In John. the revenues relating $X.X general any of which quarter million assumed recycling to equity year, share, FFO AFFO run decrease share, $X.XX an was the The in of under was fixed of management XXXX. basis QX the the General the The the Thanks, XXXX of million. to fee, $XX grew was unchanged in $X.X totaled fourth revenues current by fees year-over-year $XXX,XXX total administrative costs before and issuance a management fourth XXXX,

representing of growth in share, full FFO was For per share, and share of when differential XXXX. XX.X%, credit write-off fixed per and fourth that in mortgage, to costs the recast in the quarter. quarter, unamortized $XXX,XXX and charges AFFO, termination by the relating the respectively, debt driven the a $X.XX defeasance full the for of $X.XX facility to decrease Similar $XX was property year the third year-over-year year, associated was to of our of compared per the of for FFO extinguishment to secured AFFO unsecured revolving X.X% and and occurred million loan

AFFO current share, to by and a when conservative of December still quarter compared a on XXXX yield common dividend X.X%. stock while year-over-year cash maintaining in X.X% the fourth our the approximately announced, previously $X.XXX company of dividend, regular dividend and we paid annualized representing As XXth X.X% QX per ratio. cash XXXX, FFO the increase Overall, increased company's cash payout

respectively, and ratios payout FFO of of we remain stock towards announcing quarterly our very end quarter the XX%, efficient common at XXXX fourth anticipate the Our dividend and AFFO cash XX% and first quarter for regular February.

debt fixed enterprise target. net times, ratio value sheet, reducing balance pro forma healthy We long-term progress to to to charge the our continue of good made we to very net X.X total of year EBITDA leverage to coverage we X.X XX%, a of ended maintain and the Turning times. debt with closer

During X.X full $XX.X of the shares total program $XX net XXXX, of net million million during through we through million. proceeds for sold nearly our sold program quarter, our million. ATM for shares proceeds total the X.X ATM year And we fourth of

The As unencumber did the properties us that defease the balance I December, loan-secured the thereafter. allowed sold of four we mentioned of properties shortly our earlier, on sheet. defeasance which mortgage the in six mortgage, secured to we

our secured payoff, rate commences end, that forward eliminating the rate go-forward in balance unsecured. balance, interest sheet Following Subsequent interest exposure. swap our March credit to into fix year completely now mortgage for starting facility remaining SOFR entered revolving to floating $XX effectively outstanding a is our million we

As ample on XXXX, rate our our complement of facility debt we until credit program. recycling asset maturities to no floating accretive revolving exposure, interest today, have no capacity and

broader the XXXX, the For guidance our press in reflects and cautious night confidence portfolio, the in have in approach environment markets. of a the to capital we quality while reasonably taking underlying our macroeconomic initial the last release volatility

reasonable cost reasonable number a significant a on assets to ability to assumptions, of sell funds but our our including, relies million, ability to, capital, rent and our strength in-place investment portfolio-wide in-place million. guidance continued line annualized operational for rent at limited Our XXXX of acquire of with $XX.X not base financial raise begin an at valuations, annualized $XX.X of cash and and of tenants. base We straight

share, guidance per AFFO to Our share. year range $X.XX is full per and to year FFO our $X.XX full range $X.XX XXXX $X.XX is XXXX guidance

Our subject XXXX which is to million XXXX full market or guidance rate. acquisition $XXX acquisition we our to net and for of million yield $XXX cap similar properties, these blended occur at conditions, is to acquisitions retail a will reasonable believe year activity better lease

full between year dispositions, rate. yield million $XX at For to blended we're a million or XXXX similar sell of and properties to better disposition cap $XX our projecting

now closing I'll John it that, with back And his pass for remarks. to

Thanks, Matt.

return delivered our we second XXXX, peer group. shareholder highest in total During the

So, have XXXX, the support and excited of I'm we in front from about we've we shareholders. opportunities transition received our us into now as fully the

to and help de-risked sheet, approach portfolio, opportunistic momentum in balance of beyond. to evolving size, execute all nimble XXXX investing, and drivers Our are us

it to Operator? I questions. and team at their open time, up we'll hard all want for our work, this for thank

to line Instructions] first Mehta your the you comes question line or of open. may Our Group. from from Mr. phone. comment unmute Mehta, EF need Hutton Gaurav is [Operator your Mehta, Mr.

cap the maybe for investment more I about and you rate to provide that wanted properties you you're on you few over guys investment for some Good thanks. asset on Can expecting what months. last what grade morning. mentioned compression comments your color ask you're grade rates? Yes, seeing cap

not so inventory plethora there. Yes, a out of there's

holding not price. that price. quality credits, their So, they're people good assets have They're good breaking with onto

that your so, And there, your there's at out are people high the willing inventory assets. engaging of points not XXXX basically price worth, net because part with are lot sellers a the the to

or feels expanding, something Almost, So, that the it rates definitely in. kind are that like you say seeing down. back they have just cap are of come coming and following not cap a tenure back are we rates

good it’s we'll We have really opportunities, are pretty you hopeful and right so the market optimistic but if some strong credits. a far, buying that get

Okay.

Second on leverage. question

Your to times, X.X pro current your you up ratio that go finance forma at levels, at do as to that debt remain to you you do EBITDA to acquisitions XXXX? expect expect or for look

keep like right? to the I down. to it's going up around but company, a lot move we'd function It it it in think just general take a Yes, and to that as the size of doesn't of move range,

So, we'll performs, see allocate will the debt where see opportunities and how and the of the capital buying respond and stock accordingly. where we we'll is, cost and are

Okay, thank you.

you. Thank

open. Corporation. Stevenson question next Rob comment Our of is the now Stevenson, from Janney line or line comes from Mr. your

credit sporting guys the goods seeing or on years? thinking are you that vertical how DICK’s you just sporting the excited something about about that you goods growth has Is few acquisition? next the the in over there is are DICK’s, given John, it

always in a kind own of we've well looked that how DICK’s operator stores that category like impressed at strong seems just that very the we've the the it they're and Yes, with ones been like killer. acquiring, such they're performs and we

from seems strong And company it performance these their locations. really radiates so, like

So, really comfortable we're operator. that with particular just

that's there up Okay. rate And in that being some blue barring out asset? portfolio particular the more to is below for sell, expectation how much offer you'd wind want cap would of your that what today the

have - even our that basically to where issue. I in a inquiries long we'll can - we we And as not mean, as XXXX we're getting point sell. seeing obviously, there's Yes. anything on we're price market the we're not sell properties

would've seeing we We we're the recycling there them, out basically, year. so, we candidates better side. didn't is attractive didn't we would And sell the some it good this really on looks that sell than expect really think pricing but for thought like

more again in call active So, the, I somewhat expect the to here quarter. be second it of

on Okay. of for cap are dispositions the spread type And and assuming you then between Matt, what the year? in your acquisitions guidance, rates the

XXXX, Yes, with XXX in so or call it'll consistent be I probably think did we it points, plus what minus. basis

guys, Okay. time. All thanks. right, Appreciate the

you. Thank

is Milligan the comment question your Our from next of line Mr. line now Raymond Milligan, or from James. comes open. RJ

there wanted terms Hey, to curious cap on from grade, good to you're seeing just morning, guys. John, comments that revisit type lenders the sort investment and your compression lend rate what I for of just investment? I'm out on of

where cash. high really we're no the it’s right worth, Yes, There's involvement taking seeing place in net activity all lender now.

net that a and lender to So, it's locations. there's the in whether no it's smaller and and asset pricing. comfortable high of it’s really a or with on no just problem capital with place stability They XXXX just there's lease, very want worth, the need, credits particular net

to if low. lack expand bit? So, maybe product I is, we were that's a the rates increase, keeping comments, would question your see available and little cap you guess more per sort function it's to of of rates cap expect relatively guess of volume the I a

not definitely out would It's absolutely right. there's there. I - because inventory you're Yes,

a because assets portfolio out seller, rate is I would you motivated of or what seller for, we're had expand cap forced that's all at a higher see deploy opportunities there you to yields. or think bit waiting If

what And people going That's so, basically sell, you're of that if have for. know they aggressive. waiting to all be to very we're kind not

bit. lot a more activity a think So, expand saw yes, cap sudden all you of I rates would if a happen,

about then outstanding we That's of that? Obviously the bit a Matt, should through guidance equity helpful. for year. And How the more the the cadence little on count. implies share a question think

bit activity went to our the the that's the so mentioned we and ATM year the with Yes, a see that before you investor blackout. of start did presentation, leverage on can little into Gaurav we pro in forma earlier

I of a guidance has well. be in I issued. that would transaction So, expect good already within and chunk activity as that The implied been amount, think the balance equity the guidance to more that of backend-weighted, track would

year? for you equally expect is a versus terms or mismatch in And - do the think then, there throughout you pretty do acquisitions, they'll the dispositions transaction you timed of activity, be expect do

you funding to half in of of the probably the the probably the a is expect bit active the second the John's side little there'd I a and good can from that perspective, backend-weighted think comments, on second this disposition match then balance but more quarter, from be year. acquisitions to be

Great. Thank That's it for guys. me, you.

Thank you.

Our Erdner, next the from Erdner question from or comes of comment now is line open. Matthew Mr. line your JonesTrading.

cap of kind there country Are expanding kind Jason. or for on the or Matthew it around? where is throughout are regions of than compression steady guys. Hey, specific holding rather all rates compressing, any

a of - don't as geographic national the wave. Maybe may really buyer expanding. I exhibiting in - say steady think that have Oregons I it's different areas far be don't people that's something all it's new Californias, area pull, but or Yes, area see as that than I a there's bigger don't like growth that particular are the across. I mean, just some would lower is pretty big a as a

last for specific are And to that you. trying recycle that guys is it you're industry Got then one or is there you just investment following in? up, grade any that targeting, me, tenants

industries. but be of of It’s the definitely sort - more It'll it staples kind assets, be won't really of obviously entertainment on side, your investment traditional way, grade guess. I leads the good there's consistent

Thank guys. you, Awesome.

Thank you.

your Gorman open. Our question now next the from line is from comment BTIG. comes or of Gorman, Mr. line Michael

specific know in is that that time opportunities talked rates. as seeing market. out thanks. or investment a sectors. Are some grade even from about both could just more stratification Is I maybe about others cap talked seeing previously there's if you've before sectors, investment morning. the some And then acquisition out I well, the more the shorter starting to if little some that grade that spend there's John, they're play maybe bit heard tenants? that leases too? talking get still differentiation there role. I as you too, about with We've Yes, Good the was wondering more within duration you also or out assets you've well near-term between know priced

the Yes. out duration. I I on duration, inventory say it's merchant getting pricing say active I not building will about, the the new really on It’s are - not active we’ve that's shorter The it's gap one of in hanging stores. mean, got been kind for thing side, hasn't wouldn't - builders to in there. shorter compressing think that more. any there is, - as the

getting be. of I first for the good but you're construction not Rates obviously. elevated. not up So, don't as going they're performance they look mean, to that They're like And then, obviously had hoped. inventory. everyone are is coming market not used construction the costs all, as lender make down tougher the still further,

basis, that low makes of So, square per assets of older kind rents you're the buy assets. construction these the on talks as foot very about far as the product to costs attractive these basis a with able

lot properties, these basis on the is And so, capital into because attractive. duration come a the shorter so that's whether you're of why seeing they're

in to of, likely attractive or this terms And debt rate are all? pipeline to are near-term you helpful. don't markets of have to Matt, or What then thinking swaps seeing that to if just in debt keep see you, markets That's most would but line? you it at any or maturities, maybe You no debt, you be it. on the able products rate Got here? investment to the point exposure what to you rate, need your the be variable quickly for did maybe pickup put start terms optionality about on would how floating be would fixed opportunities, a in the the are available on you side,

an think bank swaps there I for market. is in certainly appetite the

we match fixed line I we the so, of the continue whether loaner new And or maintain to could piece a fix of can term some sort approach. acquisitions, other think on that's or debt,

in runoff much terms been capital available, of On sheets. hasn't as the interest there of side, balance people's rate

duration and real pretty in quarter, up allow capacity funding with year. third the pick some which loans I and estate should the second to expecting match market term to into And to the think banking better everybody assets here start is up. so, longer for been It's open tight

accessed getting attractive. bank size the loan us, private to For the historically We're market where market. term more placement we've is a

duration So, of could think you I both where is see debt. areas add those us longer incremental

Thanks, Okay, guys. great.

Thank you.

of or Our line line from next Golladay Baird. Robert Golladay, question from Mr. comes is open. your the comment W. now Wes

Hey good hear Can morning. you me?

Yep.

unit deals are Hey, you out great. OP Okay, guys seeing there? any

discussions, right price I certainly say - it's whether us. purchase been have would for There's kind the not of there but

there's ask on OP like but take wide. think that asset units, would I folks the So, the is to too bid

but some improving. Okay. planned And the for this then, dispositions of capital has year, cost been you obviously articulated

the XXXX? basis So, business incremental the I'm XXX curious, or versus this improved year of how do light dispositions you balance efficiency points scaling in of

Yes. additional Well, we’re capital the to that disposition using assets. on buy side,

for looking it's sure. - So, just not definitely than the just taking advantage We're other we're and accretive that, shrinking we're not portfolio the But to recycling. grow of upgrading recycling. beyond

we’re opportunities. actively those so, pursuing And

for one then And Okay. Matt.

potentially I a EBITDA, be floating benefit on think does are X.X a you long on over-swapped then did to debt. maybe spread some rate And your debt? point doing Would debt having mention a at this maybe more and lower the times where point what floating rate you fixed there you to start rate?

times, our on Yes, revolver the benefit with and a loans. X.X basis probably that's so point term to XX spread the the

every it forward, quarter. Going resets

the it'll But quarter. a certainly once little there into benefit head get bit So, second of helps. take we time to it the

the debt, a the five-year we swap. duration On longer did that was swap

I think a on what is interest and new So, are rates to on new match of kind origination it side. swap loan. if term we do that debt Whether and that'll the out, duration loan, term with out further where farther go depend rates when on hedge would up the available effectively we

everyone. All Thanks, right, great.

next B. the Kucera Mr. of or question from comes from Craig comment Our Riley. line

Your line is now open, sir.

been of rollover. ask answered, Yes. but Hey, good I guys. lease have to morning, about mine your Most wanted

portfolio, much a having bit I see just I are you little in ‘XX and ’XX. year pickup to curious over the but Are think here any this you And in any have the starting at about thoughts you you on had certainly be lease point two? on expirations discussions or in a next extensions? historically, haven't would

Craig. Thanks, Yes.

of to with discussions. locations the for - get come in had early to to seeing And something actually years lot some We expirations have a early extension an couple try We're extension. tenants of a away there's basically renewal. comfortable assets, but those were those if opportunity open an the do on with waiting discussions. till we're to something certainly tenants And multiple

So, intended yes, discussions renewals and we're about in obviously early renewals.

for Okay, Thank great. you. That's all me.

Thank additional at sure in Mr. turn the time. remarks. like conference this any no to you. closing for over I'm the I'd questions back queue Albright to

to for you forward Thank much after. talking you look call, attending the to very and

Thanks, everyone.

and program. thank in the you This conference. gentlemen, for participating today's Ladies concludes

wonderful have Speakers, disconnect. now may Everyone, by. day. a stand You