Agree Realty (ADC) 4 May 212021 Q1 Earnings call transcript

Good morning, and welcome to the Agree Realty, First Quarter 2021 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 Simon Leopold, Chief Financial Officer. Simon. ahead go Please

and quarter for XXXX everyone, Agree us Realty's first earnings thank morning, joining you for Good call.

the value the to Before thank we to maximizing forward success growth, ADC build opportunity record long very I look here Joey to of stakeholders. that to and join our while of and the upon to assembled. begin, Board company's for excited I’d I’m phase outstanding for team like at next track and they’ve the the contributing Agree

Before for law. call that Please statements we over the first our turning call to the certain securities language. Joey the run may discuss be to note cautionary me this make results that considered during quarter, forward-looking let will federal through under

XX-K from to mitigate pandemic the pandemic; severity a the effects and pandemic risks forward-looking our results discussed our a release subsequent uncertainties and on on the and to differ yesterday's matters actions us for statements of see the and actual on in scope; related of or forward-looking may Please reasons, uncertainty taken its statements. direct for various COVID-XX underlying number tenants. our the impact; significantly economic the the Report Form Annual SEC reports filings, and of latest discussion containment including of measures and indirect duration including our any and Our contain and earnings

in I’ll measures SEC release, net turn core to to financial non-GAAP earnings comparable including from core financial and funds Joey. discussed over of or adjusted In now to website be filings. measures measures Reconciliations can directly most these recurring the operations debt operations we call and found GAAP from funds our addition, the FFO; EBITDA. AFFO; non-GAAP or

I'm report and to you, ADC Good officially is way. aboard. pleased that X.X under morning everybody. Thank Simon, welcome

in with accelerated systems, every people, trajectory of on focus and place company has unprecedented our processes the the in and market the combined respect. unique Our opportunity

team CRM construction, from Work level real decision through making vast through its as Our everything System. to measure key our while on planning the of data, execute modeling clarity its performance, we and speak infrastructure What the company. quickly is enables indicators, capabilities, what success have platform management powers asset seeing informs increase These management as reflects tools well provide is and present platform that our tool, team. to underwriting, streamline constructed The have asset launch are is of an At materialized acquisition culmination future our visible the capabilities, core engine. idea in results ARC, performance started proprietary the Order enabled and Management less multi-year as static growing spreadsheet now aggregate we establish its time that effort. front, these and our and and and technology access relationship data. the and guidance the team externally portfolio for into ADC tool to and ARC to members opportunities powerful our our manage decisively growing our a of our be our has it dynamic a pro-actively and is

We future. near very capability are demonstrate very in to excited ARCs the

we opportunity we and us. technology company to take of have we the In rise board leadership to market our the to that is distinctive deployed, match additions a in that sits intend the not occasion and addition to positioning. the This of but continue front see advantage still,

representing properties $XXX XX acquisition net million. approximately now our first almost quarter we were XX our of results, platform, retail our three in quality through growth million lease Moving platforms. high across the volume these $XXX to properties invested external during acquisition originated of

distinct first opportunities best-in-class retail we times, very during of the average XX% two Fresh first quarter located of than Westmont quarter a XX.X in best-in-class of was While consumer tenants properties being comprised our clearly The and executed average leased first operating operators volume several focused notable auto acquisition of quarter lease XX leases investment The the X.X% maintained volume off-price, acquisition weighted ground term in strong general more in during uncertain parts, of of the on record cap years. electronics, XX a grocery being and these had Amazon partners. a grocery first service derived merchandise, volume quarter, properties Bloomingdale, demonstrated and during a weighted by leading retailers. sectors. XX% number from XX and with sectors, convenience store, rate including stores acquired auto our of This We acquired on tire quarter achieving including disciplined had grade and Illinois. transactions

pleased additional as our are very to opportunity to about within and add forward to opportunities top a We our look tenant the Amazon portfolio relationship with XX them. grow

tenant; exposure down all by at just this an surpassed disposition the XX as accomplishment and CVS basis recently leases Walgreens acquisition, brand transaction, on opportunity which net Additionally, quite foot new still XXX growth is of Walgreens average nearly market our With with has weighted $XX portfolio square assets. portfolio Even unique pharmacy CVSstores, driven for our XX largest points basis. this year-over-year, that pharmacy rents below opportunities we signed year our per time acquired a or high values the in a residual total portfolio including recent of over the at stores our and difficult By reflect developer CVS acquire pharmacies Downtown Walgreens. XX% portfolio duration X.X% in below nearly with are to in space. CVS Walgreens find added that this years at that drop had long to to pharmacy Walgreen exposure former to and portfolio. The performing exposure I unique of term Connecticut, Greenwich, to a end to of we've year one anticipate

space. XXXX, their of HealthHub in continue continue MinuteClinic acquisition in as we innovation rollout market I The pharmacy thoughtful consumer and CVS leadership. sector Aetna overall to given to now the the their in to concepts As and discussed and the favor leader, recent demonstrate calls, of adaptation preferences, dynamics the

During Jersey. incomes our With daytime Hanover,New within at thoroughfare located of store the this for household at radius, of five first added a is east also success. quarter $XXX,XXX REI long population and median XXX,XXX positioned a a we retail store term mile major

again retail ground aggregate during further of acquired highest on Our the ground past evidenced almost the focus annualized of our quarter. we to portfolio record purchase this base by $XXX quality that XX rents during is building for the XX% number portfolio We of added leases quarter. price acquired million, representing an leases

Realty ground our Hill, CarMax at the during first total tire, discount Wawa California, acquisitions convenience a grade include is Ground in our our XX.X% of Group. of Our of stores, previously the a quarter from and record tenants overall annualized quarter six announced now acquisition assets activity, company's lease comprised Pleasant from ground XX% Inclusive Lease XX Lease portfolio Kite our first of premier company stands and rents rents. portfolio retailers. investment exposure now Ground Notable base our acquisition of of lease derives

the sub across well to deliver record as strong industry, expanding relationships such as to to track team’s our additional this of properties add portfolio. deep Our opportunities execution continues

billion $X.X XXXX acquisition pipeline, while we acquisition quarter, robust in our $X.X to representing and increasing year and strong increase as the to visibility reflects billion, the XX% range disciplined opportunities are into seeing of mid-point our Given very full our portfolio, grow at guidance. fact a are guidance our to first criteria. our that annual investment remaining to increase stringent to a compared enhanced the activity This our we committed previous

quarter and term losers winners exposure our as investment grade end view improved real XXX stood dynamic into points. We and and the almost points, grade estate continue intend increase fully exposure has long stacked bifurcated retail a on side. than to investment by X,XXX of and At to more portfolio’s basis stay winning or at basis two representing significant a year basis more XX%, year-over-year than we

opportunities. Solutions Capital development during million. total development platforms, or had four our onto that more projects We compelling are that Moving committed of quarter, and than first to under capital represent completed see continue PCS construction in we the $XX Partner

this we in retailers One a pronged to Naples, million XX end our located completion We Texas. remain of $XX the delivery projects Washington, anticipate with with grocery Angeles, will commencing and during first to first be Subsequent on Decor Collision Port with development first XXXX. of lease. look & focused announce Floor was be XX during our X-ELEVEN also The to quarter total pleased subject Saginaw, cost growth anticipated I'm external quarter we approximately we to Florida Burlington upon more first Texarkana, XXXX. quarter, commenced on expand million. development updating the on projects cost in a during the platform in X-ELEVEN to be the will take a second Michigan. our quarter, leveraging to project Georgia. rent to anticipate commenced with quarters total of and quarter Construction two forward where our place for new in of they'll we year in January three PCS completed new $X projects ahead. subject in the Buford with than continued lease year these outlet by best-in-class progress our and of We consist with development in a you Gerber relationships development

& asset less the real Walgreen's average dispositions lease term $XX.X locations. testament in Dave time a of of we IRR disposition X.X%. term quality reduced cap a franchise Buster's our of Michigan their a the in restaurant. we dispositions, were sale than X% ability two of Rapids, to million on sell of This to proceeds Dave to and These & underwriting reflective and Subsequent Buster's base the the and Texas $X our years our of included total gross is quarter. just Notably three in to at our nearly another This for for as million, this portfolio. exposure properties Buster's Austin, during representing sale. the Big four more Moving Dave end, as short weighted rate on in cap remaining remaining estate well sold X.X% sold rate a real-estate first completed of to quarter at than had approximately &

quarter executed of the leases, approximately extensions During XX,XXX new square area. feet on options we leasable or gross

As point a our approximately quarter-over-quarter XXXX asset at XX stood maturities at for points. and decrease a base a of basis effort, of basis result annualized of end team's approximately X.X% decrease our lease year-over-year of XXX rents, representing quarter just management

maturities represents XXXX leases are only the single during lease position ABR X.X% positive only of annualized well rents very the base No year. of of or and expiring course $XXX,XXX in X.X% Our as with ABR. XX exceeds lease a maturity

April, Including including of construction reflected our XX, disciplined now As portfolio leading at XX rapidly of of our payments $XXXX states, portfolio rent eight collections consisted in XXX thoughtful data. to rent consecutive across ground our for properties and retail The months. we've be retail growing of March continues collected XX% least leases.

During payments the quarter entering we less rent portfolio first X% than collected deferral rents. for more our of of quarter agreements XX% than representing the while

our a base operating As collections cost reimbursements. reminder, includes data recurring rent both and

website. pleased continuing and to about our include of made investors quarter and any we forward bankruptcy, these our the rents investor here. in report front stakeholders charge remain collections. on our to base was for I'm and tenants first future COVID addition We successes when report the with also be related operating and engage not providing to inaugural In our found transparent calculations. I denominator data can excited cost in making our in have and that ESG the complete the ESG committed published section to look and our who to reimbursements adjustments to

I'll his Lastly, on a United served previously Rakolta as September States John Ambassador take Emirates Ambassador confirmation our United Board board to Jr. I'd welcome Directors. of like Arab from to our until moment XXXX John since of to to our back His growth. any company call then as the leadership our over next the questions. enter contributions can we helped be to up that, his phase will it hand XXXX. shape open we of invaluable Simon for and and With

the for Starting an a the X% funds operations from share, was increase. per increase quarter was with for first $X.XX a earnings, year-over-year Joey. from core quarter operations funds year-over-year. $X.XX, of X.X% Thanks share Adjusted

four treat deferrals our to past elected FFO measures the we’ve rent quarters this delinquent include revenue. receivable During as and COVID-XX

per diluted equity outstanding of offerings share impact share these The settlement As stock a reminder, if price quarter. Florida of Per our prior treasury and for $X.XX X% when first was to above deal included stock implying in year-over-year AFFO within full estimates to trades count aggregate the growth to analyst offerings. our current from of related the XX%. dilutive ADC share, per year FactSet, is negligible range $X.XX

operating range. of broader and was achievable $X.X Given amortization X.X% of in and into pipeline and or G&A of to the lease current end first end the year as investment revenue of million the quarter, we General the higher above administrative this non-cash environment, our growth total towards view visibility this level excluding totaled market and intangibles. expenses the X.X% expense below expect

While a percentage our X% we systems, people points is on XXX approximately of of will impact decrease XXXX, total to G&A the anticipation the excluding revenue roughly in and revenues. to invest total continue amortization as XXXX that lease from basis intangible for

a million. for expense As for year, of increased $X first within the team $X.X $XXX,XXX in $X.X related G&A acquisitions expense of almost expense income to for annual was billion. reminder, and billion fluctuates to volume guidance quarter anticipation range total reflects acquisition the acquisition on one-time a our our G&A approximately to current tax true-up our XXXX taxes, Due based volume for the new income part

anticipate For approximately now to be million. expense total XXXX tax income $X.X we

our on the markets capital to quarter. Moving for activities

upon mentioned XXX,XXX net first quarter's active an were the offering As for entering offering, forward proceeds approximately sell total proceeds net net almost of to under March end additional at gross $XXX than ATM We our our At to liquidity. anticipated more shares available we follow-on credit proceeds also underwriters’ net raise availability settlement. anticipated XX million. forward $XX.XX our we more of option January forward than last we into to agreements in million million – anticipated of purchase of stock our price are completed in ATM X.X on shares of of Inclusive net a than from which outstanding the X.X sale approximately quarter, call, outstanding $XX of during offerings had which million. stock, outstanding for common facility, generated of we ATM of the offerings, $XX quarter the including under our settled proceeds XXX,XXX forward $XXX shares public of average shares, On proceeds under common approximately million million. and more on in shares $XXX have million approximately

offerings forma was March debt recurring forward our of to net forma pro equity continued our X.Xx, outstanding pro meaningfully XX, as approximately As leverage. to EBITDA reduce

increased approximately value while of equity net quarter the was includes impact X.Xx. end at a to approximately Xx. debt principal record charge which our to fixed recurring Excluding company unsettled forward EBITDA offerings, debt was enterprise Total XX%, coverage to amortization

announced January, the dividends dividend dividend the and over $XX.XX per the from increase of a we per to transition monthly annualized quarter representing amount first an year. X.X% decaled $X.XXX of reflected and dividend amount last the share During February The a monthly of cash per dividend $X.XXX quarter annualized of for monthly first share share March.

dividend quarter dividend over declared respectively. $X.XX per conservative payout an XX% from we increase an of turn increase first monthly or of Our of per of were $XX.XX like end year. the share cash ratios a The I'd per of annualized FFO $X.XXX XX% that, for core per an monthly With of X.X% share the AFFO share quarter share. annualized to to and dividend the quarter dividend to over amount second amount reflects call the share back last Joey. per Subsequent

Thank you, for up this open time Simon. at questions. we’ll it Operator,

We will Instructions]. session. now question-and-answer the begin [Operator

comes question from first Please Ki Truist. go with ahead. Bin Kim Our

about and your will your share X%, You high about Why EBITDA, range into quality can a leverage translate bit to support it right Joey, little your you to range when debt great philosophy. that. AFFO all could higher best-in-grade morning. last you is growth talk range a good Xx think guys? you account believe take I quoted know would target not that Thanks, of it that EBITDA. Why more is to see higher? for to the nature I relatively be and growth leverage the total per AFFO speaking. Xx

X.Xx, capacity and a our down leverage about the even is lease we portfolio Simon could it expand liquidity so move sitting the of leverage Ki business, to Xx increases our you at even and forward AFFO and brought the leverage. prudent, net balance a prepared to which we think we these private so operating we the comments, It today anyway during Xx. balance significantly morning but offering support good Xx you're here, in right, think continue term, historically generally been strong to at like lease does at from think What Yeah, sheet Xx forma Xx. a the as know – rules. mentioned Xx think XX% our well, with conservative fast ability, I the of is found you time running to and think and course I a achieve balance at I that target sheet the We’ve potentially hard of net we execute to pipeline clip north look more you digit It private our a continue forward know term but aren’t per annum Xx. in I strictly pro that growing give and the contract on But that's go in stated near offering, equity with the if and really a pandemic here. to to specifically position between single Tools long Xx sheet and Xx – fantastic is same growth to we're range. context, right, equity between running upper in in think us –

business. the to certainly it's maintain anything? you higher powder could the Simon, dry we on to execute prudent continue the think portfolio while add to leverage, So to support want

we raise in to that's bond able the that capital Joey’s I and way, leverage thing growth that the strategy with call AFFO of Yeah, cost a talked we really overall important efficient part that leverage where it’s and kind able that we’re – effective right is clearly points. these we our appealing Ki very to in on be really about, capital I’d Bin now be to is achieve market, to going talked add think to the an investors important the the at we're you it know only and continue of about

balance like the seems right a stakeholders for it us, just comfortable of So all company. interest sort the the place in between

ahead. McConnell Katy go from comes question next with Citi. Please Our

good Thanks, us changes quarter. in volume making or insight your targeting outsourced new into of down morning versus the the at Can you based the the everyone. close you the ARC platform? that on your using give Are criteria some you're underwriting in any assets technology

Good morning, Katy.

your You in of acquired specifics the question is know that the quarter? first part what growth, we the about during

Yeah, because sourced just growth. that you volume the this of

and single I’ll closed got so of in – on and long doing you, you know bat a terms digits, to opportunities. stock our source, so we received as that's tremendous we vast in committee actually XX% upper continue of team's we will and of assets sourcing, what So the of the business of tell clear terms in the majority closed what like, investment new the XX%, we and that We've terms diligence here. as we job obviously uncovering

in that we dash-boarding capabilities I of transactional to acquiring remarks. really and any capabilities will And it's what $XXX in access then mentioned get enables arc to real-time match quarter to of is fair and To data question, second the your dollars given the part for to the close the prepared so million. say billions

our lifecycle us, an real to throughout quarters lease be fantastic of will acquisition focus activities So to both would composition. on source of continue leading well I as side, anticipate it's high industry tool the ground for in focus similar to our terms retailers investing We’ll but in on assets remain origination omnichannel in asset, quality estate that the as and We’ll “sandbox.” opportunistically coming operators. entire our for in continue a

then asset. demand look you down sell saw to Dave does this What category your are Okay, and plans thanks. what got? further of you like Buster's And the energy & exposure and for now talent

the and ones is there a use is for if totality Smoothie of mixed & Zone, in payment you Dave a our in adjacent exposure the very meaning Mercedes in downtown Buster's former the the Orleans, New assets, Benz dome Center were New property Superdome. to the Orleans, which complex unique the So us,

totality So the both, our the of exposure – totality that’s there.

in dispose cap / the our and able those with, them very the and I So representative real think that two look the we of had if are we could begin & estate. nature Dave mid-seven is were we for to that quality Austin entertainment comfortable we're of it experiences high we with. get term inquisitive to never the overly the in years a so assets of Obviously That at bid and X.X opportunity asset we were achieve Buster's remaining of on them, growth. right

talking was an that optimal openly couple It wasn't a that us think which I even outcome for for and inbound there So was about been marketed. now. an we've quarters of

Thank you. great. Okay,

Katy. Thanks

next Crossett from comes Nate go question with Our ahead. Please Berenberg.

Hey, guys. good morning

for curious expecting? up pricing what of the can there outlook grades Is comment to Have on seen any or far out as you as pressure I you with any Just what kind of guess? kind there? backing be change we like should your looks see get

tier aggressive and comments terms and space cap our peers it some in we the quality of lower some in lease lease to data, and be space we Well, rates see see in continue net just of the think the from marginally high I to continues net compressing. quality pricing market attractive, in general

rates of continue let's of the basis in depth stays movement know to any technology in source any terms range cap truly or rates now, of terms see and in our don't a go basis, if and specifically on We I the it, X-X breadth in this don't I team. pressure here the rate. plus in or – call cap points, XX minus our upward know you cap relationships, given our tenure range value here, forward bound just But material

it are guys. Portfolio, are like Is out there volume that call for quarter other Kite increased Was record that's that Realty out a then and there a of driving helpful – or there can that, anything get. for you there you it grounding is that's there? the function and just to just the Okay, portfolios

Well, really source certainly of Pleasanton, component long California, as view acquired Wawa’s. a different like space a about the talked nature we superior used We the a and ground given prepared to basis. term the Kite in acquired a unique in we CarMax California, and the breadth was lease to and the depth in remarks, we in of the a but number there, CarMax position opportunities in we one-off and of continue lines car businesses discount tire on continue

Kite the at portfolios they certainly it. as a majority on the was opportunities vast of were arise, Portfolio continue there. a basis of one-off So but look piece clearly We'll to such

thanks there. Okay,

Thanks Nate.

St. Our Haendel comes next from question

Please Juste ahead. go from Mizuho.

morning. good Hey,

Hi! morning, Haendel. Good

Realty Hey! that backdrop M&A So here on and participating. space scenario curious then and your there's the I'm thoughts Realty seen the I M&A, know more on latest. any could up and the are pricing, Kimco, we’ve what view broadly, in guess Income ADC for your VEREIT. the what pick here Weingarten from today also you is in you on guess And see Thanks. if I Income that the curious VEREIT and

public-to-public see retail to interesting emanating certainly in space. it’s overall the Well,

look any It do. and obviously the different think the as space. then and I all in if specific. We'll opportunities importantly time us the is on as as not I just was what potentially the I'm a then pressures center coming provides to of a seen and M&A, it M&A at we’ve continue we opportunity unique. given in think space the this transaction totality, adjacencies continued all space the it to well sure we've shopping number seen space And and operators of remainder, in most our is long

are a a not We're purchaser leaseback country given XX granular and have minus $X the the on nature know at You a going you know – price plus sale at million we’re best point purchaser to we pipeline time, XX $X sandbox generally through a speaking; very of generally very in any you million. average know retailers speaking. portfolio here tight transactions of we our – or focused not to

our purchasers, continue continues asset we to for an set quality us expand look M&A there asset it’s we’ll a and so be on will on with XXXX this private to at opportunities. the always purchasers leverage, to dilute portfolio. what competitive never of opportunity backdrop very I've the leverage do business our accelerate the So level to and continue purchasers, unique said, and is

We are surge sales and we transformation already on we But a outside up-leg in there. pandemic has that more sandbox quality unique of view that our highest on in to and no home, you're in attracted March remarks, think retail. the K we what prepared the continued portfolio to winners lot continue retail really and improve made to We're country stated term. retailers a the the There’s if going the that's are retail to the dynamic I drive near is and focused as the like as a and of K here. going be to circumstances

overall of you are on thinking business, view and thinking Anything Got How that, of ground exposure then your the the over that it, time? thank you for Thanks. out your growth. lease for LOI that. what’s part I’m of the as contractor about good today

Well, I by They a similar anticipate size we currently, executed QX, the The the pick are to with consistently extent opportunities we months. on doubled say I by lease continues think continue adjusted I’d returns lease significant surprise the in pipeline that XX in – the has QX. problem in higher say source realty. team of to I portfolio retail can to in almost to approximately given best just see the it XX.X% know, and ground ability margin you risk me assets. that we

to And so capabilities makes qualitatively it through their team team’s what the pricing function on a the surprised in of to unique about basis. our sense a efforts from portfolio. truly a and goes granular will – aspect it to efforts continue a their those and Where within business, the is here uncover me It’s be

predicted have find there of So their I historically we would those to continue wouldn't but XX.X%; opportunities. wouldn't have at idea XXX, I be north predicted

turned side, LOI you front. contractor the up On anything

Nothing specific.

for today. we’ll diverse sector continues are source that but we're pipeline the QX, QX and tenant, overly going for strong nothing There to of be guidance, today. out Obviously Our to geographically opportunities QX. similar some to be the getting and rays transactions or by by noting are they notable call to hence unique

Thank you.

Haendel. Thanks

next question Linda ahead. go comes Jefferies. Tsai Our Please with from

Hi! Good morning.

Good morning.

this in think know $X.X billion the morning. side? consensus consensus of I transaction you of – does good volume reach Does and end high this on equity To incorporate what of you Simon end estimates, assume high said The the growth. kind assumptions year-over-year XX%

incorporate The X% that was range to and XX%. said the does, way to But precise it X.X exactly not what didn’t know XX% the the we get. does higher be put on outcomes expect the going X.X to we of that necessarily it where out science. never you're non-acquisitions This it to we end, all a to and is you range there, toward not was look,

day. acceleration out to we're also It there results the of does quarter-over-quarter. But an We that's trying things to. what are buying get every require

a of it get of this $X.XX So and does that to AFFO order of towards end first higher require end of acceleration we really results the the have pipeline. our to in an back quarter. that's to range call it In acquisition function

market Hanover. in come is more opportunities seeing in Joey, then higher focus in the or to highlighted and east Greenwich remarks gain in exposure you to this of the CVS then you And to part markets? income higher REI Thanks. Are areas compelling these your prepared

CVS first retail that was for be very leases, just was to are to in That really The geographically XXXX is to we Look, in continue believe XXXX. in or clarity. These street we The acquired sandbox. urban to [inaudible] portfolio, as our dispersed. late the ground from I acquired CVS the quarter. spectrum as long in rural Greenwich across are

opportunities So we’ve we in the see to terms coast start country. just given of in south Sun accelerated there. coast seen going opportunistic are north the accelerated the construction opportunities across and Belt the in to nature but really South, of We’ve down

you. Thank

Thanks Linda.

comes Fargo. Our Todd next with from question go ahead. Stender Please Wells

how transaction, lease in just to blended big context hone maybe was a and deal some kind just there. on thanks. was before CVS Hi you that? And of What the the term Joey, extended, remaining

I think more the please. color Have market. you you rent commented below being on any

exposure years It of buildings, exposure, their reduction for years. off rent not are square Walgreens foot. XX top the So But of as the the ran from foot those of Short also aggregate typically I half. third XX on transaction fully to dispositions lease that that was the the terms their approximate in $XX you per hence in XX roughly square remarks; was mentioned core unique five Midwest. pharmacy unique. per mentioned CVS I sub, if rental those as the from challenge Part head on historically, look CVS overall approximately to the to ranges locations with and These million. in was at rates foot aspect square and know space, remaining rates $XX recasted to year transaction my typically rental The you of extended which replacement overall leases, stores a about pharmacy the my $XX the the a across XX,XXX was XX,XXX it in markets acquisitions stores. full only

And chance beating results. with over street morning approximately that this just have paying leases. new again, the out foot, of are XX impressive we transaction, brand CVS $XX year CVS results recap, so in came square per context this by

what so CVS fan doing, both And real are business, front. transformational the within we their of but estate also is on

which by hence the they another business divergent are clubs opportunity out, Alliance the the and acquisition Aetna impressive Walgreens extremely to to aspect. post like we PBM the I Health had doing from historically, purchase, acquisition as the store and went while CVS so know Wellness the we account, roll are you the are into and anyone’s a out. on They It’s to if had Rite and – mentioned, And them went, a Aid really increase see if what Health Boots they vertically continue health Wellness integrated really attempted perspective. MinuteClinic roll so corporate really

historically, the thought hesitant CVS low of and low the rates of per this and XX nature transaction. are points, attractive purchase leases, an front but we on given prices square end are square per the the foot the years pharmacy; We on hesitant residual was price the the extremely we rental low

leases Kite, don’t What acquired the I know ground this. then there? and assets on Joey, Thanks are if helpful. top missed that's you that of any Right, that from I the color are

mixed there, opportunity was portfolio and centers it a was shopping and Bank from we to their beneficial, that it believe portfolio to to ground I both laps a lease a to Chipotle was obviously so So us, direct thought a throughout their couple exposure of bag, level opportunity so locations, everything and of increase to America, an Panera Bread existing parties. it transaction the out was for

stand shopping tenant single centers. all It's alone, no

tenant Correct, outlets, for is easy which all single us. fairly standalone

you. thank Alright,

Todd. you, Thank

Our with Peter ahead. Baird. Hermann comes next question go from Please

questions today. ability faster you Thanks my talk the platform? Can with about Joey! now for the to close new potentially deals Hey taking Thanks.

I’ll appreciate ARC about Yeah, just little the just opportunity. I question the – to mean I a talk take bit,

really So of years what acceleration few the to is found began business a I ago the ramp.

to database powered then a express sheet significant That forward manual switched Just quickly spreadsheet, CRM IBM guided us team, MySQL time boarding in our acquisition for capability from our who’s Greg dash through and a became by And tool ARC, database. real tool operational ours, a there input. difficult project so the metrics, I into the Board. literally The CEO aggregate piece paper and That a concept. out MySQL trained of lean Sales an on a of we Peter us key TMX Lineage then VP then to and Director in that to visual static started part an Coughenour being and initial on nature for morphed it’s database and using by really whose key it just we database. of critical an and obviously That customized tool fantastic became hooked sketching the required our TMX team IBM, and projection of a whose a Lehmkuhl, tools. then idea to guru got an facilitated which our idea management dynamic give

member acquisition few quarters, do more they it, entire to it, the all a modules, into now our transaction slice, cool drill of really it levels team all dashboard the it management additional we of types dice So data, last really have visually, really export company. every display In that of constructed expanding cut, has even asset things. can

work expands, into sorted that have Management aggregation the type now orders work full duration, the full orders into, number Order that database we way and to tied the level So order, filtered where the a expand planning tools and by underwriting of our all a data the any and country property of of they System here, and a be Work map the by terms maintains, criteria, country. could in seeing pipeline that so of it's across literally drilled work

we’ll the Another in transaction current to enabled transactions from full status to shortly time is the That beta; the team level, status all very of here. that CRM the our module live Level, diligent. at real the contact team see Management go at of first pipeline Customer the the

us harness ARC average It’s $X.X of billion at million in and our scale $X.XX connectivity in very to opportunity a transactions purchase million. to to ingredient to a the be wouldn't the continue and cultural. team market. without It truly ARC, possible to created price an we've the $X our is to billion fragmented $X people execute between So the technology key for

transactions So data boarding, its platform the us estate both system, measure really time gives tool, pipeline to us to to going again, and we and have activities; XX establish on the individual them. through it KPIs gives at team any through this real This the XXX dash all given manage time. through capability real

to and the tool day. here, the accelerate it's our the at or that at transactions transactional and powerful both rolls So minus result end of those XXX-plus level continue obviously a business to the will expedite that up rolls up

that you appreciate I color. much. so it. Got Thank

from Instructions] next Our go John Thalmann. Please Ladenburg Massocca question ahead. [Operator comes from

Good morning.

Good morning, John.

maybe of, color maybe for figure of kind of investment around at out XQ guidance, conservatism essentially around back kind just XH. kind on of and you provide cadence year? this based notable expected some your the you look 'XX visibility if versus XQ. would the out just to you decline it volume be of $XXX kind those Its Could calls trying if XQ that's of a which million I'm just into investments, or acquisition on

Well, granular I think the to just zero it's QX, truly predict difficult visibility minimal mean business given into of or have as a visibility very QX. purchaser, I we our project. nature into

from is just nature the about letter into now very close, the good our remind average I'd of execution We visibility Again, intent QX. shorter, some have people, some transaction transaction. XX to days approximately of longer,

to nature fragmented space business a And just our a so difficult it's project given fluid the obviously market, and forward. of

Now And the expectations know January, first know in what what come been will given initial that the guidance transparency any out we promise time. we when week we've to our out we $X with and investors. come has at $XXX million of to of always adjust know, billion provide the we and

does right not that of of it's business, module, could. allow a see be we Peter? wish can't and ARC a I will I tell future. environment; but it's future the just combination us you, our combination unfortunately, next see So the the we the would to

volume if give to $X.X know don't billion as the you just, about what mean about $X.X on think investment think you think front-end volume significantly loaded I about I guidance, that you I see today? quarter-to-quarter is investment the guys, maybe, billion, if you based but

we at loaded. we're or level. at of Well, down I so we cut don't wouldn’t terms in may mean front-end say anticipate million, that Volume three for printed assets that be approximately acquiring. think QX just be and to I the I million different that remaining up very $XXX I can quarters. acquired, necessarily QX $XXX

close business outstanding our so is to generally reliant predict July and because quarters. to close on or estoppels, the whether Again, July So the we'll provide in things is things XXth see close won't July cross something where issue everything is But It an X. upon last going can't business, X, can on to XXth, close. our asset we closed. tenant

for can get visibility timing transparency have isn't You know ARC and and and that around. a those us. move closing or in that transactions provides then upon of like jumbled so diligence, quarter here. and reliant corners around third-party close we But outstanding visibility our ideas this will to level really of gives estoppels operations and have necessarily such just things as us those the respondents, we the execution that, everything

lease a guess percentage cap of kind you on how the how levels, non-ground rate versus cap And much lease rate ground if how leases maybe rate, assuming trend? the blended saw kind cap overall historical were investments then quarter lower normalized in could And leases the I investments? as assets acquired ground understood. Okay, of a compared to higher ground is much higher, of

base enough, range the speaking, So in relationships short-term, the buying we’re due did transaction. to their generally our of general within interestingly volume. duration our relationships, ground fall Kite of leases, the obviously we long-term remaining, ground lease They duration term the assets, the our acquisition

top for the a us end can percentage mid long that range nature up be obviously between terms the falling term lower There's rates, within the for end and that cap don't but – just my spectrum of in so for California range. second part that of of at question? ground in a you leases of X’s%. off acquisition, and generally to Now given a the fall it head. Sorry. then we of in some X% have But is the they I generally generally it X% disparity us, and within, call assets, the these

there so rumblings space seeing I irrelevant tend kind competitors then those because increased of it net kind in in Are the which you makes about you leveraged these of you sense. kind like have play? been No, in picture buyers last in the think of capital range, bigger sandboxes to know one; from the lease competition non-public one same And are some they it's etc.

No.

looking CTL where the are we're at ABS buyers, of the seeing very lever point where sale participated. rates buyers, leasebacks the some think backed heavy transactions, larger buyers cap larger backed I we aggressive haven't the price

million ABS well $X the million doesn't point CTL price itself leverage play again, $X – equity or just to we purchasers think sponsors I there. or to private very backed

continues Doe unique a set. Jane competitive it's So competition our and to be

our capabilities of sheet, frankly it's and and balance our mismatch. our capital, technology our cost Given a team, platform

my taking that’s you very much for Okay, it for me. questions. Thank

John. you, Thank Great!

concludes the conference Joey question-and-answer to closing This for over Agree our back session. I remarks. like turn to would any

look I thank joining catching today, June Virtual forward and We'll you Nareit. Thank for and everybody up you Thanks. talk to us with we everybody in at to soon. operator

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

now may You disconnect.