FrontView REIT Inc

Our Real Estate Investment Portf olio

To achieve an appropriate risk-adjusted return, we intend to maintain a highly-diversified portfolio of outparcel properties that are in prominent locations with direct frontage on high-traffic roads that are highly visible to consumers and maintain diversity across geographic locations, tenants, and brands and that have cross-diversification within each. We discuss below our portfolio diversification based on several different metrics and information provided as of September 30, 2024.

Diversification by Tenant Brand

We primarily seek tenants that operate service-oriented businesses, such as restaurants, cellular stores, financial institutions, automotive stores and dealers, medical and dental providers, pharmacies, convenience and gas stores, car washes, home improvement stores, grocery stores, professional services as well as general retail tenants. As of September 30, 2024, our properties were occupied by 293 tenants that operated 137 different brands, with no single tenant brand accounting for more than 3.4% of our ABR.

The following table sets forth information with respect to each of our top 20 tenant brands (based on ABR) as of September 30, 2024:

Diversification by Tenant Industry

The following chart shows a breakdown of our ABR by the tenant industries that comprised our portfolio as of September 30, 2024:

Industry Pie Chart

Diversification by Geography

As of September 30, 2024, our outparcel properties were located in 96 MSAs in 31 U.S. states, with no single state exceeding 12.1% of our ABR.

The following table sets forth information with respect to geographic diversification by state in our portfolio (based on ABR) as of September 30, 2024:

Our Leases

Lease Maturity

Our portfolio was approximately 98.9% leased as of September 30, 2024. Our cash flows from operations are primarily generated through our real estate investment portfolio and the monthly lease payments received under our long-term leases with our tenants. As of September 30, 2024, the ABR weighted average remaining term of our leases was approximately 6.7 years, excluding renewal options, and approximately 96.3% of such leases (based on ABR) have renewal options remaining. As of September 30, 2024, no more than 13.7% of our rental revenue was derived from leases that expire in any single year prior to 2030.

The following chart sets forth our annual lease expirations based upon the terms of our leases in place as of September 30, 2024 (percentages based on rental revenue):

Because substantially all of our properties are leased under long-term leases, we are not currently required to perform significant ongoing leasing activities on our properties. We have three leases, representing approximately 0.9% of our ABR, that will expire prior to December 31, 2024, each with tenant renewal options.

The following table presents our lease expirations by year as of September 30, 2024:

We typically purchase properties that are subject to existing long-term net leases with a range of lease terms (initial terms of 10 years or more at lease signing that often have renewal options as well). Substantially all of our leases are net leases, meaning our tenant generally is obligated to pay customary expenses associated with the leased property (such as real estate taxes, insurance, maintenance and repairs, and in many cases, capital costs, subject to caps and exclusions in some leases). For the nine months ended September 30, 2024, we incurred an aggregate of approximately $1.3 million of expenses not reimbursed or paid by our tenants, which includes non-recurring legal costs and property operating expenses incurred on vacant properties.

Approximately 97.4% of our leases (based on ABR) provide for periodic contractual rent escalations, generally ranging from 1.0% to 3.0% annually, with an ABR weighted average minimum increase of 1.7% per annum.

The following chart breaks down the type of rent increase provided in our leases (based on ABR) as of September 30, 2024:

Lease Escalations

In general, when negotiating a new lease or an amendment to an existing lease in connection with an acquisition, redevelopment or new development, we seek to negotiate, among other things, relatively long lease terms and tenant renewal options; market rents; annual rent escalation provisions; landlord-favorable going dark, assignment, change of control provisions; limited or no exclusive or co-tenancy clauses that favor the tenant and obligations for certain tenants and certain guarantors to periodically provide us with financial information.

In the future, we may seek to use master lease structures where it fits market practice in the particular property type, pursuant to which we seek to lease multiple properties to an individual tenant on an all or none basis. In a master lease structure, a tenant is responsible for a single lease payment relating to the entire portfolio of leased properties, as opposed to multiple lease payments relating to individually leased properties. The master lease structure prevents a tenant from “cherry picking” locations, where it unilaterally gives up underperforming properties while maintaining its leasehold interest in well-performing properties.