FrontView REIT Inc

3. REAL ESTATE HELD FOR INVESTMENT AND LEASE ARRANGEMENTS

The Partnership acquires, owns, and manages net-leased outparcel properties. The leases are generally net leases, where the tenants are responsible for the payment of real estate taxes, insurance premiums and maintenance costs related to the leased property. The leases have been classified as operating leases and generally provide for limited increases in rent as a result of fixed increases, increases in CPI, or increases in tenant’s sales volume.

As of September 30, 2024 and December 31, 2023, the Partnership has 100% ownership interests in 278 and 284 real estate properties, respectively. The average remaining lease term for real estate properties owned by the Partnership as of September 30, 2024 and December 31, 2023 was approximately 7.0 years and 7.4 years, respectively.

During the year ended December 31, 2023, the Partnership acquired 100% ownership interests in 26 properties for an aggregate purchase price of $75,389, including acquisition costs totaling $1,380. The majority of properties acquired during the year ended December 31, 2023, were leased at acquisition with an average remaining lease term of approximately 8.2 years. Additionally, the Partnership acquired the remaining 50% interest in the Joint Venture held by the JV Partner, which consists of 54 properties as of the date of acquisition (see Note 5).

The acquisitions were all accounted for as asset acquisitions. The Partnership allocated the purchase price of these properties to the fair values of the assets and liabilities assumed, which is summarized in the following table:

During the nine months ended September 30, 2024, the Partnership sold five real estate properties for $10,773. The Partnership received net proceeds of $9,846 after paying closing costs of $927 and recorded a gain on sale of $337. The aggregate cost and associated accumulated depreciation and amortization of the properties sold, at the date of sales, were $10,248 and $739 respectively.

The depreciation expense on real estate held for investment was as follows:

The following table summarizes amounts reported as rental revenues on the accompanying condensed consolidated statements of operations:

Total estimated future minimum rents to be received under non-cancelable tenant leases in effect as of September 30, 2024, are as follows:

Since lease renewal periods are exercisable at the option of the tenant, the above amounts only include future lease payments due during the initial lease terms. Such amounts exclude any potential variable rent increases that are based on changes in the CPI or future variable rents which may be received under the leases based on a percentage of the tenant’s gross sales.