Agree Realty (ADC) 5 May 232023 Q1 Earnings call transcript

Good morning, and welcome to the Agree Realty First Quarter 2023 Conference Call. All participants will be in a listen-only mode for the duration of the call. [Operator Instructions] Please also note, that this event is being recorded today.

I would now like to turn the conference over to Brian Hawthorne, Director of Corporate Finance. Please go ahead, Brian.

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

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

yesterday's differ any of Form may of results annual significantly release see forward-looking reasons. underlying uncertainties for actual matters latest in risks forward-looking from various SEC Our discussed XX-K our statements. number statements a Please our discussion filings, earnings and the and our for including a on report

adjusted discuss including AFFO, from release, In or GAAP core website and the recurring addition, and in net measures, filings. financial be debt comparable directly earnings non-GAAP to Reconciliations measures financial we measures from can non-GAAP funds found of to most these operations core our FFO, EBITDA. funds operations SEC or our

I'll now Joey. the to call turn over

all and us thank to anticipated. lack we're I'm that risk-adjusted morning. pleased Brian, strong extremely has and buyers both this us access opportunities report for to amongst public in competition joining XXXX. to of a start with The greater private provided off than Thanks, attractive you

that's demonstrated our to narrowing contributing fatigue our a investment first and activity quarter pipeline and spread. As seller by in even more evident bid-ask

the confitulation targeted to We our forces, of have extremely competition set market seen to as new is reality Due capitalized pricing sandbox a cellular of has limited. in. acceleration a paradigm begun recent within

off attractive been propositions certainty purchasers. and diligence have close market for and with that owners private quickly very our on to ability Our to

dynamic wide weeks the has of Our been few opportunities. pipeline with last a very spectrum over

distressed currently under $XXX last several leasebacks, assets in control. that diversified we high-quality XXX among million attractive over intent executed the acquire have portfolios, cap of and sale the days approximately developers early properties rates, at In to extensions letters we've alone,

from $X Given our acquired pipeline, quarter to least at at are first visibility acquisition the for acquisition least billion raising into and volume increased billion in the our guidance year. we our $X.X

fruit, and made have said, waiver stringent have technology and People competitive Nicole and we more continuing in multiyear and by speak and multifaceted world G&A are bench will talented in information we our a will in ERP we both to underwriting continue system our quite analysts That our to our our by given investments a enabling of bear us Similarly, future technology The to Peter led execute us advantage. of criteria. remains company a to Culture, investments EVP and team few minutes. the programs, from our leverage provided be the Both rotation and and our Widevine efficiently. leaders. have transactions distinct led nimbler deep source gain ARC volatile, review, not

pre-equitize leverage target prudent moving equity and of the risk would strong to balance calls, shifting billion below significant low our decision On or of stressed has range. avoid approximately with strategy. of we that We remain in sheet outstanding curve forward position. our advance year well the ended first earlier end I our $X.X an extremely up and quarter liquidity, Our the we in this proven

our and geopolitical leveraging core successful identify remain. economic very extremely uncertainties to been have high-quality and We opportunities relationships and competencies

acquisitions supply properties auto platforms. full sectors, home basis tire over million assets growth X-year million for was was and X are year others. and $XXX leased During and X.X%, the higher across high. net external This to parts, high-quality of first among XX of the quarter, in we investment-grade basis of lease fourth years the approximately in includes cap point service, farm average rate points the XX and of the the acquisition the a term our quarter expansion lease weighted weighted our grocery, average acquisitions to a and XX than XX auto Dollar The improvement, $XXX XX XXXX. retailers retail relative XX% invested Store over rural

several quarter, ground We volume quarter. total the $XX million, of variety of X breadth investment-grade grocery acquisition the relationships. leases ratings. our representing of and our space credit in super-regional X the acquired with during industry-wide retail both partners, approximately of proposition with transactions national unique the strength our The executed transactions the X% during which demonstrates We carry sale by quarter led and and leasebacks for value operators,

an transactions. seller, of a well of portfolio as opportunities as acquisition blend-and-extend diversified a institutional number the completed several also direct from We developer

that spread investor vision and hard across a and full the to real net simply fronts. estate-focused our long-term of REIT has service team's not work a environment retail Our due multiple capital-constrained accelerated lease

were wrapped inclusive the under [ph]. with Moving to X of on of during We completed quarter $XXX during the and $XX an $XX incurred of totaling cost in cost anticipated quarter total million. in over million Cision as continued for projects million. on projects up with our Gerber construction the XX anticipated PCS projects we XX. the quarter platforms. with development aggregate, the anticipated commenced Florida California The new nearly projects or of million, March Construction XX had of $XX during cost costs In total

on Lansing, extension area approximately front, Ohio. leasable located or in gross Michigan options leases, Brooklyn, feet new first Sam's clubs the or XXX,XXX X On options included the during leases of quarter. square we leasing and extensions executed new Notable

At retail XX all position representing over in of rents are of leases surpassed States, the XXX including our portfolio leases continental ground total across XX of base year very maturing. basis We base growing annualized points a X,XXX for with XX end, just United in the properties XX% rents. remainder strong quarter the annualized or

exposure remained at stood Occupancy and investment-grade at strong XX%. our very XX.X%,

preeminent Our continues in positioned retail macroeconomic the and country extremely well any portfolio to the portfolio remains be to withstand headwinds.

can open for up then With and we that, hand call the Peter, over I'll questions. to

million per X.X% year-over-year FFO over Joey. first was earnings; of you, increase. $X.XX. Starting $X.XX $X.X representing share to a per AFFO percentage X.X% increased quarter core the Thank first with We quarter for contributed more share, for the during during than received year-over-year the core AFFO are This the to for per quarter. first of most dissipate pay quarter and share, rent obligated of earnings the respectively. tenants FFO to remainder year should $X.XX largely the which as

As price a the share equity settlement in to included outstanding stock trades is forward of reminder, stock treasury prior above our count if offerings. diluted deal ADC our

to related offerings impact $X.XX in quarter. the dilutive was aggregate The first these

and growth Our a growing earnings to support consistent well-covered reliable continues dividend. and

ratio of to end share. share nearly X-year announced year-over-year dividend of dividend an monthly X.X% dividends and monthly per of range the to the XX%, our quarter which the for dividend represents X.X% increase first a the a $X.XX XX.X%. cash quarter end, annualized During represent basis, of per for targeted April. the of Subsequent dividend monthly share quarter of monthly of annualized of March. for annualized over $X.XX The declared per increase the AFFO an a was low our On stack we first quarter, share a to common each dividends first At XX% January, of we below from per XXXX. increase payout February $X.XXX XX% equates and

intangibles and noncash revenue. of was for above administrative X% adjusted quarter. G&A expenses X.X% million revenue the or market expense the of of and General in unadjusted totaled lease amortization first $X.X below

X-year expense expect basis of efficiently. decrease as our referenced we investments of to the stack full adjusted percentage to revenue minimum a $XXX,XXX. process a points quarter was that earlier very G&A IT for have would enabled of represent tax year, basis decline points. This Joey us income approximately and first least XX XXX For as at Total a the improvements scale

For year $X be to expense full $X XXXX, tax million income the and we expect million. between

approximately million proceeds approximately be during markets the million. end, $XXX still shares of million our We quarter, activities. million X.X settlement. quarter sale to remaining are on first net settled equity anticipated existing outstanding net proceeds raise shares X.X agreements we At had of upon of settled Moving under forward capital realizing to to which $XXX forward

of X.Xx outstanding for XX, to EBITDA our As our approximately equity. forward of debt March was forma the net pro settlement recurring

of impact forward approximately recurring unsettled was equity, to our debt X.Xx. the Excluding net EBITDA

end amortization which coverage level fixed $XXX Total healthy a the was X.Xx. $XXX cash-on-hand. million forward dividend with revolver, total on approximately at of remained debt outstanding ended of and approximately availability billion, charge very enterprise of XX%, principal preferred We ratio value at equity the quarter quarter million including liquidity to $XX the $X.X includes in while our of of million

us and execute advantage affords summary, In on in the maintain to take lack of market high-quality of balance a tremendous that opportunities. fortress-like to flexibility continue competition sheet we the

Joey. With like call to over the back that, to turn I'd

Peter. up you, for At it this Thank operator, we'll time, open questions.

with Bank America. we question time, [Operator which come first will from Dennerlein take will Instructions] our Josh this At of

accelerating Peter, full gone partners; your everything And What's come? your your like shift what Joe, what's your real accelerated? a being for just on for you're to wanted I that's estate shifted? to comment provider on,

appreciate question. the I

I all long-term out well platforms the as remainder us X has platforms, think building the been vision of as X a for this external growth all team.

able way a multiple with anything on whether for deliver development between. all it's to partners, our in really and So being organic function to growth, avenues that's the of leasebacks different retail sale

the at of I analyst that's XX-year team lever to opportunity celebrating through really the we're programs, -- multiple lunchtime. At the and as constrained think provided developed the the given analysts mentioned, I the anniversary capital rotation retailers the here, same us had environment. personnel actually It's today, first changes we've again, today platforms. the time, our

the multiple I that levers to really and challenging appreciate situations, given provide. then capital of and think and growth their to have step we accelerate options those our we ability into availability

it's just And that it. increases side, close here. like rate cap to from the rate maybe stopping probably Got interest on then feels

further are come what uplift side? you feel Or private the Just you adjustments like cap of on Like on do of still is there's kind to kind seeing there rates? the cap in curious, side? rate

more I sellers this tough there. it's we in see purchaser meeting and today. the the is live the we in choice That's I see, capitulation. we world in But future market, past we accelerated fatigue as What frankly, in the mentioned frankly, predict few mentioned. of remarks, are during we see, the prepared as to seller weeks, Well,

as into basis opportunities nominally nominally is we rates space XX fragmented is we well. looking have And for could so are tick QX. I what a be very up this and happens QX cap Seeing sorry, days anticipate tick everybody, I on difficult. difficult. within a could large beyond -- remind go-forward will visibility as well it. potentially Obviously, and And up

not And sure of broader I'm so it's cap the rate environment. emblematic necessarily

come Our Eric from Wolfe with question Citi. will next

at Looking amounts current X% acquisition nearly your value. to enterprise your it of revised guidance,

equate should sort this should X% be it, basically whether activity, that in growth flow much rule to the XX% capital around flow, curious in you to growth from internal of X% call any cash internal have created just Just of cash EV rewarding have how to as level every providers? rules you growth

no rule basis. in tell time, AFFO on internal the dividend We're in fast an growth I'll we're very is enterprise qualitatively, to capital accretive there's make that result I there. would it Obviously, should Well, just important. to sure and you cognizant tell shareholders. and hard doing increased same investing At you,

of in see you during ever this the quarter retailers investment-grade assets, of at looking the of we've acquisitions potentially outside can to had probably some best years XX country. As quarter, over the of code depth term you're highest maybe XX% the of quality

a as not So we've our well the shareholders. want to to to accretion not real of talked just on sacrificing prepared want at the to to willing we risk time, and for And -- estate the create and deliver, there improve we're same We the risk to go That's do. quarters about here as spreads something larger as up obviously, credit portfolio. couple up we're the to going quality. while remarks, curve

from think I we've to that investors is our maintain away listeners discipline. so and most can the been And able thing call take important this

undertaken levers the shifts through and haven't strategic of of We able any that terms all to growth. execute we different we're in have

you're a sort versus, call would able curve? to instance, it, X.X% go there make say, X in just spread higher of, grade, more -- your get spread trying risk embedded figure or explain if noninvestment-grade that's there's if of there's less might investment to is a mean, on guess, rate, for that the out a if attractive? cap would it tenants versus help you the I level it. take effectively certain because out sort I'm view of Got that certain any that of I And loss

[indiscernible] rating. like It's specific which file the grade don't an investment-grade remind It's Publix for huge in I'll not us. a credit bogey best Chip and country, and carry case target this of just investment-grade for great retailers operators we that obviously, credit everyone, question. fans investment predominance us carry is rating, we're a don't of the an

talked In not function a just here. can't risk a interested single-purpose the in is just also terms of spreads, interested that washes few, not get repayment credit, investor fixed it's opposed demand for of of curve real art car income net good golf is. function the have lease that boxes about to in we something have but estate that going up I've of to a and That obviously, buoy. naming residual. residual that of We're we what a or understanding the top investor a what We're and a net residual. always term. principal expiration of the that is The as doesn't investing is on lease

less those. a the drive in and of a and unfavorable lease comes perspective, But underwrite or From expiration challenge. biggest outcomes we're our to when to are re-leasing us to event boxes the rejection. able boxes credit again, obviously, demand single-purpose single-purpose it bankruptcy So

will question Stevenson next Rob with from Our come Janie.

what X.X% a of the slew exposure sort does when that completed. a were all else by know pipeline I do of XX, ABR? it's recently Is on that? exposure there's Gerber completed, referenced Where including a Once stabilize? the said I like X think collisions Joey, you How that does are where acquire take you But X% in depends and elsewhere. these the of lot year-end. that that ones X%? done, envision completed all the and you development tenant

you're dead think on. No, you I think

likely to by about most collision the there's relative on about at Gerber But probably X% X% that we've in X at Gerber owned Group. in space. position the Collision is Boyd equity-owned Collision, lower their last publicly to non-private their length that's talked end, space operators only relative We've a and think the I large X% frankly, country. exposure. talked in Gerber Again, this X%.

their the They're depth You occur that Toronto complexity They're the us. on can given repairs and a today. financials an look just Exchange. the interesting and see for partner their the extremely great operator. balance tremendous Stock is sheet, It space and collisions a of

cameras I X your light pole today, think about it's talked and a bumper sensor. tap on I a it,

unique net And so of really Gruber proposition, in new store payers, third-party has very with and auto they're the got country a insurers targeting aligned terms this the in opportunities.

space. preeminent think they is on Gerber we I X% in of your that end operator think X% fan big a we're so And the and low to that probably are of the collision the But X% appropriate.

amount Or -- And starts months? do they continue over XX to now people be a development of next there other pipeline? other the by that replaced sort is in of down and are disproportionate that the wind

always in then Gorge. a change opportunities with We'll we're dime. see. can have that we in obviously pipeline tell but California, We you, significant X completed on other I'd wrap retailers up Florida and to but Gruber, a looking projects with at also

market sell but assets you is environment? theatres? than How tenant total also and given time right And current to you about the the Okay. assets about second rates been are Or how other settle You've holding today you thinking are better near-term question, off thinking today that? are dispositions issues then without down? interest buying,

think first stands of we're I comfortable the -- we're really with really all, portfolio where today.

along fitness weather launching didn't exposure. been a and on historically, health exposure, active, franchise, have Luckily, in on the way missteps relative acquisition the front, restaurant exposure, the many especially Walgreens make reducing platform disposition was since XXXX. too We basis, we

them just, activity minimal analysis, XXXX our agreements of purchasers time. cost think with there team benefit is rolling which and inefficient works an for is I dropping here, frankly, off it's of proceeds. challenge biggest use And just frankly, different -- time X potential today purchase for the through disposition but this a

our sale going the if for capable portfolio aren't are right at -- So the waste price, X,XXX everything buyers and inefficient time our in be executing. of assets necessarily with we are that of to but

we balance in generate don't At be opportunities. our the to same to continue recycled the sheet. given to try position those capital spreads And vet to so time, mode we'll need of

come question And St. next our Handel from will

Mizuho. with Juste

for of I discuss deals you the are what seeing Should are portfolios discounts large you within current quarter? market? portfolio the on we This line to Handel. this portfolio expect larger hope is I Can you you And this larger deals. guys acquired to doing well. Ravi you about ask come pricing wanted Vaidya still the still environment? in

Look, it's a target, Robbie. moving

in I XX assets. think terms and the nature were portfolio a was transaction leases early some we extensions. to short-term of diversified they're unique of approximately portfolio on X did There

in that to on at I the capital who's time. depends and wants market the discount out there deploy think portfolio

I it you there of time is less And there. lot so a What certainly, is bidders tell is, out place. and will

I slim in competition the -- our or infrequent none mentioned As prepared is the today. remarks,

sale frankly, select And and so well the that based composition it upon purchase at of timing. needs as they're are the purchasers their that it's potential timing of really the there, the out as then potential

it. Got

acquisition Just funding one execute is equity? for you needs on to it would issuing than your leverage Can target? X.X% revised what your the discuss from your up let today you tick And more here.

I'll it into the very needs balance let to Peter but leverage within our while sheet year, staying targeted funding talk Peter. We it over are about were frankly, that coming our not. I'll pre-equitizing execute clear range, could we but are, the detail, in hand

recurring pro of total Robbie, $XXX Yes, X.Xx, quarter forward a in liquidity great of forma equity. including the net of we ended million position to billion, debt EBITDA with $X.X outstanding

range. leverage of mentioned, equity and our we and guidance. as a additional year, we our have that don't capital within executing can on on Joey guidance, plenty stay We're need acquisition targeted for this so we have execute And today to

in And position an today. excellent so we're

Thanks.

Linda with Jefferies. question Tsai next our And come from will

capitulating in What color now? And stabilizing And show would the who profile pricing? with provide how of is rates the are impact? do take on up the you potentially you it transaction sellers long market? to pricing the think on in Can

of range wide in notable, that a and sellers Well, line but specifically builders, that pricing the it, I'll breadth sense. call for of have are hadn't then tell think Reilly's That's calls, think X/X prior term capitulated I we the none private owners, mentioned XXXX hoping assets. the On credit market. an of effectively those seen of it's any holding Old overly we to -- supplies and first Linda, merchant longer made full no case. tractor acceleration are types XXXX or and crack, you, or pricing, we we've meeting $XX.X seen the on and that we're that

so whether And today, the here, obviously extremely a where stabilizing be for spreads rates may The capital, is it's or from still more inputs are cost was just construction loans wide. disparate year ago. debt owners permanent it private still of

we're mean And market to of see, so absent hopefully, sellers continue to Lucky problem was the more frankly, transaction I off were holding on handle that the X sellers going transactions were XXXX meet their really that frankly, handles. those that, to is that buyer. real get and X

developers this from about quarters you you've that the past think few do opportunistically sell could And them? been on talking then how the And facing to cool? buy more the need merchant quarters, business many you how

we're have. to interesting. now we high strategy range are our can retailer That to the want we're capital involve that merchant from how the both partnering continue for it's build ultimate looking pricing would programs programs, in is their merchant driver builder backfill programs, with conversations like some were solving builders, the for how develop these on exposures about change those and be question resolution tell tell effectively is self-development that those storing merchant the programs these will where and new they they the of But XXXX us builders take execute conversations partners I weekly programs. build do to or here and that on also retail their beyond, merchant the platforms to but effectively transitioned are stuff at retailers. of now and needs their of sheet, be conversations growth the The frankly now this creating can who the pipelines somebody some right Well, today. can XXXX you I'll have driven you, in we by they converting merchant their The flow. balance going and that fee to to paradigm having source. more how either doing to

last Just question. one

with XX% portfolio terms allocation, comfortable In how ADR... little ticked I you now exposure? grocery exposure are guess of a up to of your close bit

We're quarter our during small risk up the the comfortable. transaction did leasebacks. Extremely quarter the going grocery this sale first every -- including quarter. an this curve. Kroger as we this investment-grade was past Foods We grocers with jumped buying Obviously, Whole We're not not acquired well. operator, quarter X or

look exposure, into that acquiring relationships So in I very grocers good here think if country we the we're the you with. have that best

with Markets. question next Capital our from RBC come here And Heffern will Brad

how curious the of of and a more much in has turmoil changed I'm financing much that and world the is to how the seller just recent final the just markets? attributable bank it capitulation recognition is

it Yes, the of mean necessarily recent here terms turmoil think obviously I in any news that of -- I in don't is recent market. bank the is

is comps with are handle seller for isn't Obviously, finally working. or trailing it XXXX private think purchaser just data. that that holding the X realizing out I

more to see comps. realistic starting they're think I

frankly, I going fatigue. to It's this that none on mid-Xs be is seller this trades think they're I Xs. to talking think are we're to in brokers sitting just market. saying, actually low seeing, or here the And slim that

are the weeks this sellers this We're least but we These an billion isn't Now year. especially in past isn't few are acceleration, across to This any leaving the wholesale seeing $X.X a means. guiding by board of flag. cracks. the at change,

to guys will like cap market the emerges in, just there people you of bank compete lot boxes, I'm a that. small stuff? side be go that that this with things think a maybe you more finance from would eventually rate the on bank like XXXXs do mean presumably I to Okay. thinking

creates it you some of sort pressure? do think So eventually

can't certainly hurt. can't hurt. certainly It It

all it window as a seen they was. bank [ph]. market fractional leverage for what if market regional mentioned, I cash, of piece to weren't of those you think upon Many we've relied XXXX purchases, the the

does And really I'd you decision so down capitulate. here comes But here. put to of tell cap at back individual willingness it owners the to wind it expansion of certainly again, a it that can't and and/or potential their hurt. rates

then, to And equity kind need going it. the Peter, the back commentary no got of financing year. commentary, mentioned the Capital the for earlier, Okay, rest for Markets from you of

For that sort term offering the the incremental I mean, loan expectation debt, and you just Or unsecured goes would are the line? locking on credit is where a that, some rates think about of now? in doing or

I depend ultimately we Yes, and perspective. a from on Brad, will think markets that the what pricing see

near-term mentioned, you As no capital for need there's today.

$XXX just it revolver million end the of Our under quarter. on the as of has

And million as have equity. of well so $XXX plenty the forward there of we as outstanding capacity

we accessing And access the of and to the in of [ph]. when the markets terms so how and monitor capital terms -- opportunistic be year, of in remainder for continue them we'll

Wes Golladay question from will next Baird. come with Our

you program How can this this PCS can back? this us Bath Bed you any Beyond, And you year? then update redevelopments development can big get -- on you an if there & year in start any get give

ready the back. most to acquired, Bath, be paying see continues an bankruptcy and really no over, bass Yes. RCDs not tenants Bed could be leases a stores year. would Bed from be side, most opportunities and the would on on acquired have the absolutely those extremely Those go. NOI would lift second process. as It $X.XX or terms or those get We bat also leases through effectively turns of you'd Bath next this to year excited the those X I in down add, a Bed flip $X.XX foot we could have have depends then liquidation rent. think of portfolio. through the question, likely likely bed right? we'll in when We're process, significant To average the to wind the anticipate gap whether I those

significant estate off-price pieces how great of are with see we'll play there X but real really predominantly interest those in So out, players.

what first it, question, was Your Wes?

could -- quarter. How you X started Yes. year in think that projects big this first the I starts? for get How

is today's get as as equals duration. longer has environment. in Again, as large as deep to Going duration make and big sense it risk, opportunities development

has remunerated And that so it to think appropriate going we appropriately. we're be spreads to be

on the gall with retailers the will just front. behind seeing duration and we we XX environment cap from on unknown now. We're ground a macro rate be that opportunities so And because selective that to development Capital rate a or platform Partner a We're seeing projects. we interest of we're working what we into months lot that lot of get both continue cap fronts. on of are of or in. enter we don't XX make Solutions But caught if risk organic a the shovels see want sure rate have number and from in here delivering to to expansion We're

down settle cost We talked where especially equity, where pay of on lined line there up the credit? about gets debt of without then, to the and term. just than final short in And the it. maybe the cost acquisitions [ph] question. Is of past higher being just early Got the just forward a point my the you

is Wes, Peter. Yes, this

we continue as we'll to the think shorter-term it to utilize revolver year effective an continue I view borrowings, tool where and throughout for appropriate. the

As fully the revolver. you balance mentioned, we have and million of outstanding current backstop $XXX our equity forward on

in And revolver sense monitor makes other context our of so the we'll most available pipeline what us. the markets to opportunities and in to capital continue pricing

Thanks.

Truist. will Ki with question Bin Kim come next from Our

lockstep you of a what secondly, IG has do kind in guys? to if your cost capital that that capital your of your pressures presence, cost for you of in feeling? for somewhat And try given rise a So significant Joey, price are tenants? rates open cap does they portfolio And up you opportunities see additional

a great question. It's

of that the retailers. you, the in are extremely or first of You unsecured We is. executed more tell QX an increased question that or brings of execute look cost with will respective And sale often paper are frankly, and specifically we of Obviously, cognizant in interesting early the a There's Peter transactions an relative where space. on quarter. opportunities. sale-leaseback trade or very when in up can to pipeline cost the number see lockstep debt I'll seeing capital, that's transactions of their disparate retailers these potential transactions in we a the QX of at already. leasebacks their transactions in number QX

is retail And in goes from as seeing there. for partners they're for of comparing where make the everything But flow to saying, the where our overall do everything to opportunity they probably paper. that an an the which goes will to us disproportionate obviously, that -- so us with year issue I And think that at volume it are astros and increased and be we're volume anticipated level as this could is sense a terms CFO if sale-leaseback? does coming unsecured big

the you and -- And can the for rates what cap look debt? at second, that longer-term does for at what in you price like pipeline raise acquisitions have the

be of take But first prepared similar last That's here. part. increased here, it the depending nominally composition think answer guidance now, timing rates strong. either the the credit the be will some our drastically obviously, mentioned is as I higher pipeline, be it's as on closings in stands -- quite I'll not why will I or accelerated, really QX profile, equal, and the I'll in nominally Peter we in remarks, week. cap right either terms question. let debt QX higher of

believe, cost what today, debt of is on could which that capital. with line for we in XX-year roughly near-term But today, again, I we a debt the last quarter's call. Ki mid-Xs don't of terms our in we relatively price And in Bin, need have discussed,

here if third question. a can And cheat I ask and

have Kroger. with So Is the deal grocery out Ocado joint distribution you looking centers. that an at they to you're venture automated build a a Obviously, their with CFCs, at? did all opportunity

No. We're to going Obviously, going retail single pared a the with operator. but stick to dominant here Ocado, retail. openings we're to with to Kroger stick actually tenant back they've

was So were the the added Krogers believe X stores. quarter, X I all during grocery it freestanding

Ronald come Stanley. question next Our will with Morgan from Kamdem

of a Just quick ones. couple

seeing you're specifically cap appreciate there opportunities? commentary on of acquisitions, to selectation in rate Just you I on leases, the ground but the ground the what can terms on leases. maybe talk movements and the

Yes.

talked very more fault people then I recognition. of I've And the been our anything, to recognition, then sell-side calls, due probably there's the safe a think cognizant to previous opportunities, be interesting continue fortunate But of for whether value select opportunities. ground if take some continue advantage But with seller, to leases, those that of on it have but space. California a while, in recognition more paid to the number There's attention they think do blended becoming really the those during to were source generally quarter. speaking, them. in more we now. X our are there we'll value and think embedded more in aware of of I the I ground a We but We quarter this in is but pipeline. people a find extends, former space lease them acquired embedded one of

then question so the just acquisition obviously, was it. this And ticked -- up Got second quarter. the guidance

we sort could capitulation But more like to seller do advantaged it of back I you that of macro? appreciate at this are to back to for position Is what the needs of when point? get are for acquisitions waiting that of talked right? think EV, this we So you about sort what of guys sort happen engine sort think in get to You sort comment. of XX% given

of at, that value. think I were than EV XX% it, call still right? Well, the more for we're year, enterprise $X.X of XX%-ish billion

comes rise we debt of in whether the or us I need or think to favorable a of more spreads to cap the cost spread. adjust what see needs give of inputs rates happen appropriately, is cost capital any

the young. transaction It couple frankly, of an have fairly outside QX of the right weeks, now visibility is of any with don't here. We change year day still average taking again, first can days. so And XX

Our market always participants current. commitment see has materialize, the been, we're we to keep as going pipeline

QX. And specifically and increasing the so beginning our guidance reflects pipeline QX that of

Instructions] next Tayo Suisse. here come question from [Operator with will Credit Our Okusanya

slowdown lot that peers of everyone. of of Yes. of you curious, I'm seen do your I issues more are also with board, kind again, the potential I across things, being has a clearly Good being stuff you market stellar. middle interesting non-IG are the side harder everyone about of just the IG, in credit credit that kind talking It tenant been IG morning, talking Joe, demand on debt we we're the base. or haven't about side of both of get, on kind kind and to that these so side equation. you guys of in seems a the mean, lot -- non-IG think, consumer all surprised but

I'm tell wouldn't you surprised. I Well,

available. I seeing think are we're publicly that cracks

concentrations. as the relative Party lack that with news, morning, Bath space Tuesday made we've franchisees of portfolio think individual transparency the filing of public the whether I that's whether Burger challenges seen bankruptcy then have credit & in Bed and the assets, entities, a it's the So lot King City, to Beyond,

deferral. And first or you, rent a step concession the would so I always tell is

back The I overt cycle. we're in, in I at more investors which that seeing are early available world second to continue would something is to the post-COVID we the which more that's tell rising generally on that all and you, to obviously, will rationalizing first. rationalizations world top. to very pros the is store But to see, believe a step involve if up bankruptcies, cream retail this more pre-COVID occupancy

consumer. casual Now, a outlook, macroeconomic crystal subject strength is But that in space. the ball, and cracks obviously to the of a don't lot see we're have dining to the of the starting we

assets You'll with with. names those see the flooding lot of is market everybody some familiar a currently that

news I company. obviously think the their with been have parent the challenges [indiscernible] betting

to itself a happened in this, going continue correct. itself we're the dramatic be in night think not unless demonstrate see I so going and and economy, continues falling it something And it's to reveal to to

are individual cracks to think outlook, think and everybody's to those through potential you the up outcomes that discernment. read the I what relative you is how Now macroeconomic

to for question-and-answer remarks. conference over that And our management I'd concludes turn any to closing session. the back like

everybody, you, conferences, joining we we the and everybody's Well, for thank us forward upcoming time. appreciate you today. to seeing And look at

Thank presentation. very today's much for you attending

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