AGREE REALTY CORP

Previous wording

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company’s future plans, strategies and expectations, are generally identifiable by use of the words “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” “may,” “will,” “seek,” “could,” “project” or similar expressions. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company’s control and which could materially affect the Company’s results of operations, financial condition, cash flows, performance or future achievements or events. Currently, one of the most significant factors, however, is the adverse effect of macroeconomic conditions, including inflation and the potential impacts of pandemics, epidemics or other public health emergencies or fear of such events on the financial condition, results of operations, cash flows and performance of the Company and its tenants, the real estate market and the global economy and financial markets. The extent to which macroeconomic trends may impact the Company and its tenants will depend on future developments, which are highly uncertain and cannot be predicted with confidence. Moreover, you should interpret many of the risks identified in this report, as well as the risks set forth below, as being heightened as a result of the ongoing and numerous adverse impacts of macroeconomic conditions. Additional factors which may cause actual results to differ materially from current expectations include, but are not limited to: the factors included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, including those set forth under the headings “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”; global and national economic conditions and changes in general economic, financial and real estate market conditions; the financial failure of, or other default in payment by, tenants under their leases and the potential resulting vacancies; the Company’s concentration with certain tenants and in certain markets, which may make the Company more susceptible to adverse events; changes in the Company’s business strategy; risks that the Company’s acquisition and development projects will fail to perform as expected; adverse changes and disruption in the retail sector and the financing stability of the Company’s ten…

Excerpt shortened here; the source contains the full paragraph.

Current wording

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company’s future plans, strategies and expectations, are generally identifiable by use of the words “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” “may,” “will,” “seek,” “could,” “project” or similar expressions. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company’s control and which could materially affect the Company’s results of operations, financial condition, cash flows, performance or future achievements or events. Currently, one of the most significant factors, however, is the adverse effect of macroeconomic conditions, including inflation and the potential impacts of pandemics, epidemics or other public health emergencies or fear of such events on the financial condition, results of operations, cash flows and performance of the Company and its tenants, the real estate market and the global economy and financial markets. The extent to which macroeconomic trends may impact the Company and its tenants will depend on future developments, which are highly uncertain and cannot be predicted with confidence. Moreover, you should interpret many of the risks identified in this report, as well as the risks set forth below, as being heightened as a result of the ongoing and numerous adverse impacts of macroeconomic conditions. Additional factors which may cause actual results to differ materially from current expectations include, but are not limited to: the factors included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, including those set forth under the headings “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”; global and national economic conditions and changes in general economic, financial and real estate market conditions; the financial failure of, or other default in payment by, tenants under their leases and the potential resulting vacancies; the Company’s concentration with certain tenants and in certain markets, which may make the Company more susceptible to adverse events; changes in the Company’s business strategy; risks that the Company’s acquisition and development projects will fail to perform as expected; adverse changes and disruption in the retail sector and the financing stability of the Company’s ten…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

As of June 30, 2024, the Company’s portfolio consisted of 2,202 properties located in 49 states and totaling approximately 45.8 million square feet of GLA. The portfolio was approximately 99.8% leased and had a weighted average remaining lease term of approximately 8.1 years. A significant majority of the Company’s properties are leased to national tenants and approximately 68.4% of our annualized base rent was derived from tenants, or parent entities thereof, with an investment grade credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners. Substantially all of our tenants are subject to net lease agreements. A net lease typically requires the tenant to be responsible for minimum monthly rent and property operating expenses including property taxes, insurance and maintenance.

Current wording

As of September 30, 2024, the Company’s portfolio consisted of 2,271 properties located in 49 states and totaling approximately 47.2 million square feet of GLA. The portfolio was approximately 99.6% leased and had a weighted average remaining lease term of approximately 7.9 years. A significant majority of the Company’s properties are leased to national tenants and approximately 67.5% of our annualized base rent was derived from tenants, or parent entities thereof, with an investment grade credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners. Substantially all of our tenants are subject to net lease agreements. A net lease typically requires the tenant to be responsible for minimum monthly rent and property operating expenses including property taxes, insurance and maintenance.

Previous wording

The Company’s real estate investment portfolio grew from approximately $6.27 billion in net investment amount representing 2,004 properties with 41.7 million square feet of GLA as of June 30, 2023 to approximately $6.95 billion in net investment amount representing 2,202 properties with 45.8 million square feet of GLA at June 30, 2024. The Company’s real estate investments were made throughout and between the periods presented and were not all outstanding for the entire period; accordingly, a portion of the increase in rental income between periods is related to recognizing revenue in 2024 on acquisitions that were made during 2023. Similarly, the full rental income impact of acquisitions made during 2024 to-date will not be seen until the remainder of 2024.

Current wording

The Company’s real estate investment portfolio grew from approximately $6.61 billion in net investment amount representing 2,084 properties with 43.2 million square feet of GLA as of September 30, 2023 to approximately $7.13 billion in net investment amount representing 2,271 properties with 47.2 million square feet of GLA at September 30, 2024. The Company’s real estate investments were made throughout and between the periods presented and were not all outstanding for the entire period; accordingly, a portion of the increase in rental income between periods is related to recognizing revenue in 2024 on acquisitions that were made during 2023. Similarly, the full rental income impact of acquisitions made during 2024 to date will not be seen until the remainder of 2024.

Previous wording

During the three months ended June 30, 2024, the Company acquired 47 retail net lease assets for approximately $187.6 million, which includes acquisition and closing costs. These properties are located in 21 states and are leased to tenants operating in 16 diverse retail sectors for a weighted average lease term of approximately 9.3 years. The underwritten weighted-average capitalization rate on the Company’s acquisitions during the three months ended June 30, 2024 was 7.7%.1

Current wording

During the three months ended September 30, 2024, the Company acquired 66 retail net lease assets for approximately $216.0 million, which includes acquisition and closing costs. These properties are located in 24 states and are leased to tenants operating in 17 diverse retail sectors for a weighted average lease term of approximately 9.8 years. The underwritten weighted-average capitalization rate on the Company’s acquisitions during the three months ended September 30, 2024 was 7.5%.1

Previous wording

During the six months ended June 30, 2024, the Company acquired 78 retail net lease assets for approximately $315.3 million, which includes acquisition and closing costs. These properties are located in 33 states and are leased to tenants

Current wording

During the nine months ended September 30, 2024, the Company acquired 144 retail net lease assets for approximately $531.4 million, which includes acquisition and closing costs. These properties are located in 37 states and are leased to tenants operating in 26 diverse retail sectors for a weighted average lease term of approximately 9.2 years. The

Previous wording

During the three months ended June 30, 2024, the Company commenced five and completed four development or Developer Funding Platform (“DFP”) projects. During the six months ended June 30, 2024, the Company commenced nine and completed six development or DFP projects. At June 30, 2024, the Company had 19 development or DFP projects under construction.

Current wording

During the three months ended September 30, 2024, the Company commenced eight and completed six development or Developer Funding Platform (“DFP”) projects. During the nine months ended September 30, 2024, the Company commenced 17 and completed 12 development or DFP projects. At September 30, 2024, the Company had 21 development or DFP projects under construction.

Previous wording

During the three months ended June 30, 2024, the Company disposed of 10 assets for net proceeds of $35.5 million and recognized a net gain of $7.2 million.

Current wording

During the three months ended September 30, 2024, the Company disposed of two assets for net proceeds of $6.9 million and recognized a net gain of $1.9 million.

Previous wording

During the six months ended June 30, 2024, the Company disposed of 16 assets for net proceeds of $56.7 million and recognized a net gain of $9.3 million.

Current wording

During the nine months ended September 30, 2024, the Company disposed of 18 assets for net proceeds of $63.6 million and recognized a net gain of $11.1 million.

Previous wording

The variances in rental income, real estate tax expense, property operating expense and depreciation and amortization expense shown above were due to the acquisitions and the ownership of an increased number of properties during the six months ended June 30, 2024 compared to the six months ended June 30, 2023, as further described underResults of Operations - Overall above. In addition, during the six months ended June 30, 2024 the Company recognized, within rental income, $2.0 million of termination income related to two existing lease agreements, resulting in an increase of $2.0 million over the termination income recognized during the six months ended June 30, 2023.

Current wording

The variances in rental income, real estate tax expense, property operating expense and depreciation and amortization expense shown above were due to the acquisition and the ownership of an increased number of properties during the three months ended September 30, 2024 compared to the three months ended September 30, 2023, as further described underResults of Operations - Overall above.

Previous wording

General and administrative expenses increased $1.3 million, or 15%, to $9.7 million for the three months ended June 30, 2024, compared to $8.4 million for the three months ended June 30, 2023. The increase was primarily the result of growth in compensation costs due to inflationary increases and higher stock-based compensation expense as a result of changing the vesting period for awards granted in 2023 and 2024. General and administrative expenses as a percentage of total revenue decreased to 6.4% for the three months ended June 30, 2024 down from 6.5% for the three months ended June 30, 2023.

Current wording

General and administrative expenses increased $0.3 million, or 3%, to $9.1 million for the three months ended September 30, 2024, compared to $8.8 million for the three months ended September 30, 2023. The increase was primarily the result of growth in compensation costs due to inflationary increases and higher stock-based compensation expense as a result of changing the vesting period for awards granted in 2023 and 2024. General and administrative expenses as a percentage of total revenue decreased to 5.9% for the three months ended September 30, 2024 down from 6.5% for the three months ended September 30, 2023.

Previous wording

Interest expense increased $13.0 million, or 34%, to $50.9 million for the six months ended June 30, 2024, compared to $37.9 million for the six months ended June 30, 2023. The increase in interest expense was primarily a result of higher levels of borrowings during the six months ended June 30, 2024 compared to the six months ended June 30, 2023 in order to finance the acquisition and development of additional properties. Borrowings increased primarily from the $350.0 million 2029 Unsecured Term Loan that closed in July 2023 and the $450.0 million 2034 Senior Unsecured Public Notes that were issued in May 2024. The 2029 Unsecured Term Loan borrowing and related amortization of deferred financing costs resulted in an increase of $8.3 million in interest expense during the six months ended June 30, 2024. No such costs were incurred during the same period in 2023. Interest related to the $450.0 million 2034 Senior Unsecured Public Notes and related amortization of the original issuance discount and deferred financing costs resulted in an increase of $3.6 million in interest expense during the six months ended June 30, 2024 as compared to the same period in 2023. In addition, interest expense on the Revolving Credit Facility increased $0.6 million during the six months ended June 30, 2024 as

Current wording

Interest expense increased $8.1 million, or 39%, to $28.9 million for the three months ended September 30, 2024, compared to $20.8 million for the three months ended September 30, 2023. The increase in interest expense was primarily a result of higher levels of borrowings during the three months ended September 30, 2024 compared to the three months ended September 30, 2023 in order to finance the acquisition and development of additional properties. Borrowings increased primarily from the $450.0 million 2034 Senior Unsecured Public Notes that were issued in May 2024 and the $350.0 million 2029 Unsecured Term Loan that closed in July 2023. Interest related to the $450.0 million 2034 Senior Unsecured Public Notes and related amortization of the original issuance discount and deferred financing costs resulted in an increase of $6.7 million in interest expense during the three months ended September 30, 2024. No such costs were incurred during the same period in 2023. The 2029 Unsecured Term Loan borrowing and related amortization of deferred financing costs resulted in an increase of $1.3 million in interest expense during the three months ended September 30, 2024 as compared to the same period in 2023.

Previous wording

The Company did not recognize provision for impairment during the three months ended June 30, 2024, while $1.3 million was recognized during the three months ended June 30, 2023. Provisions for impairment are recorded when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through operations plus estimated disposition proceeds and are not necessarily comparable period-to-period.

Current wording

The Company recognized a $2.7 million provision for impairment during the three months ended September 30, 2024, while $3.2 million was recognized during the three months ended September 30, 2023. Provisions for impairment are recorded when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable

Previous wording

Gain on sale of assets, net increased $6.9 million to $7.2 million on the sale of 10 assets during the three months ended June 30, 2024 as compared to $0.3 million on the sale of one asset during the three months ended June 30, 2023. The increase was primarily due to the growth in disposition volume during 2024 as compared to 2023. Gains and losses on sales of assets are dependent on levels of disposition activity and the carrying value of the assets relative to their sales prices. As a result, such gains and losses on sales are not necessarily comparable period-to-period.

Current wording

A net gain on the sale of assets of $1.9 million was recognized on the sale of two assets during the three months ended September 30, 2024 as compared to a loss of less than $0.1 million on the sale of one asset during the three months ended September 30, 2023. Gains and losses on sales of assets are dependent on levels of disposition activity and the carrying value of the assets relative to their sales prices. As a result, such gains and losses on sales are not necessarily comparable period-to-period.

Previous wording

Net income increased $13.9 million, or 34%, to $54.9 million for the three months ended June 30, 2024, compared to $41.0 million for the three months ended June 30, 2023. The change was the result of the growth in the portfolio offset by the items discussed above. After allocation of income to non-controlling interest and preferred stockholders, net income attributable to common stockholders increased $13.9 million, or 36%, to $52.9 million for the three months ended June 30, 2024, compared to $39.0 million for the three months ended June 30, 2023.

Current wording

Net income increased $2.8 million, or 7%, to $44.5 million for the three months ended September 30, 2024, compared to $41.7 million for the three months ended September 30, 2023. The change was the result of the growth in the portfolio offset by the items discussed above. After allocation of income to non-controlling interest and preferred stockholders, net income attributable to common stockholders increased $2.8 million, or 7%, to $42.5 million for the three months ended September 30, 2024, compared to $39.7 million for the three months ended September 30, 2023.

Previous wording

The variances in rental income, real estate tax expense, property operating expense and depreciation and amortization expense shown above were due to the acquisitions and the ownership of an increased number of properties during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, as further described underResults of Operations - Overall above. In addition, during the three months ended June 30, 2024 the Company recognized, within rental income, $2.0 million of termination income related to two existing lease agreements, resulting in an increase of $1.9 million over the termination income recognized during the three months ended June 30, 2023.

Current wording

The variances in rental income, real estate tax expense, property operating expense and depreciation and amortization expense shown above were due to the acquisition and the ownership of an increased number of properties during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, as further described underResults of Operations - Overall above. In addition, during the nine months ended September 30, 2024 the Company recognized, within rental income, $2.0 million of termination income related to two lease agreements.

Previous wording

General and administrative expenses increased $2.0 million, or 11%, to $19.2 million for the six months ended June 30, 2024, compared to $17.2 million for the six months ended June 30, 2023. The increase was primarily the result of growth in compensation costs due to inflationary increases and higher stock-based compensation expense as a result of changing the vesting period for awards granted in 2023 and 2024. General and administrative expenses as a percentage of total revenue decreased to 6.4% for the six months ended June 30, 2024 down from 6.7% for the six months ended June 30, 2023.

Current wording

General and administrative expenses increased $2.2 million, or 9%, to $28.3 million for the nine months ended September 30, 2024, compared to $26.1 million for the nine months ended September 30, 2023. The increase was primarily the result of growth in compensation costs due to inflationary increases and higher stock-based compensation expense as a result of changing the vesting period for awards granted in 2023 and 2024. General and administrative expenses as a percentage of total revenue decreased to 6.2% for the nine months ended September 30, 2024 down from 6.6% for the nine months ended September 30, 2023.

Previous wording

Interest expense increased $6.5 million, or 32%, to $26.4 million for the three months ended June 30, 2024, compared to $19.9 million for the three months ended June 30, 2023. The increase in interest expense was primarily a result of higher levels of borrowings during the three months ended June 30, 2024 compared to the three months ended June 30, 2023 in order to finance the acquisition and development of additional properties. Borrowings increased primarily from the $350.0 million 2029 Unsecured Term Loan that closed in July 2023 and the $450.0 million 2034 Senior Unsecured Public Notes that were issued in May 2024. The 2029 Unsecured Term Loan borrowing and related amortization of deferred financing costs resulted in an increase of $4.2 million in interest expense during the three months ended June 30, 2024. No such costs were incurred during the same period in 2023. Interest related to the $450.0 million 2034 Senior Unsecured Public Notes and related amortization of the original issuance discount and deferred financing costs resulted in an increase of $3.6 million in interest expense during the three months ended June 30, 2024 as compared to the same period in 2023. In addition, capitalized interest decreased approximately $0.3 million during the three months ended June 30, 2024 as compared to the three months ended June 30, 2023 due to the timing of capital spend on development and DFP projects. These increases in interest expense were partially offset by a $1.4 million reduction in interest expense on the Revolving

Current wording

Interest expense increased $21.1 million, or 36%, to $79.8 million for the nine months ended September 30, 2024, compared to $58.7 million for the nine months ended September 30, 2023. The increase in interest expense was primarily a result of higher levels of borrowings during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 in order to finance the acquisition and development of additional properties. Borrowings increased primarily from the $450.0 million 2034 Senior Unsecured Public Notes that were issued in May 2024 and the $350.0 million 2029 Unsecured Term Loan that closed in July 2023. Interest related to the $450.0 million 2034 Senior Unsecured Public Notes and related amortization of the original issuance discount and deferred financing costs resulted in an increase of $10.3 million in interest expense during the nine months ended September 30, 2024. No such costs were incurred during the same period in 2023. The 2029 Unsecured Term Loan borrowing and related amortization of deferred financing costs resulted in an increase of $9.7 million in interest expense during the nine months ended September 30, 2024.

Previous wording

The Company recognized a $4.5 million provision for impairment during the six months ended June 30, 2024, while $1.3 million was recognized during the six months ended June 30, 2023. Provisions for impairment are recorded when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through operations plus estimated disposition proceeds and are not necessarily comparable period-to-period.

Current wording

The Company recognized a $7.2 million provision for impairment during the nine months ended September 30, 2024, while $4.5 million was recognized during the nine months ended September 30, 2023. Provisions for impairment are recorded when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through operations plus estimated disposition proceeds and are not necessarily comparable period-to-period.

Previous wording

Gain on sale of assets, net increased $8.9 million to $9.3 million on the sale of 16 assets during the six months ended June 30, 2024 compared to $0.3 million on the sale of one asset during the six months ended June 30, 2023. The increase was primarily due to the growth in disposition volume during 2024 as compared to 2023. Gains and losses on sale of assets are dependent on levels of disposition activity and the carrying value of the assets relative to their sales prices. As a result, such gains and losses on sales are not necessarily comparable period-to-period.

Current wording

compared to $0.3 million on the sale of two assets during the nine months ended September 30, 2023. The increase was primarily due to the growth in disposition volume during 2024 as compared to 2023. Gains and losses on sale of assets are dependent on levels of disposition activity and the carrying value of the assets relative to their sales prices. As a result, such gains and losses on sales are not necessarily comparable period-to-period.

Previous wording

Net income increased $17.1 million, or 21%, to $99.9 million for the six months ended June 30, 2024, compared to $82.8 million for the six months ended June 30, 2023. The change was the result of the growth in the portfolio offset by the items discussed above. After allocation of income to non-controlling interest and preferred stockholders, net income attributable to common stockholders increased $17.1 million, or 22%, to $95.9 million for the six months ended June 30, 2024, compared to $78.8 million for the six months ended June 30, 2023.

Current wording

Net income increased $20.1 million, or 16%, to $144.5 million for the nine months ended September 30, 2024, compared to $124.4 million for the nine months ended September 30, 2023. The change was the result of the growth in the portfolio offset by the items discussed above. After allocation of income to non-controlling interest and preferred stockholders, net income attributable to common stockholders increased $20.0 million, or 17%, to $138.4 million for the nine months ended September 30, 2024, compared to $118.4 million for the nine months ended September 30, 2023.

Previous wording

The Revolving Credit Facility's interest rate is based on a pricing grid with a range of 72.5 to 140 basis points over SOFR, determined by the Company's credit ratings and leverage ratio, plus a SOFR adjustment of 10 basis points. The margins for the Revolving Credit Facility are subject to improvement based on the Company's leverage ratio, provided its credit ratings meet a certain threshold. In addition, in connection with the Company's ongoing environmental, social and governance ("ESG") initiatives, pricing on the Revolving Credit Facility may be reduced if specific ESG rating improvements are achieved. As of June 30, 2024 the Revolving Credit Facility bore interest of 6.21%, which is comprised

Current wording

On August 8, 2024, the Company entered in the Fourth Amended and Restated Revolving Credit Agreement which provides for a $1.25 billion senior unsecured revolving credit facility (the “Revolving Credit Facility”). The Revolving Credit Facility’s interest rate is based on a pricing grid with a range of 72.5 to 140 basis points over SOFR, determined by the Company's credit ratings and leverage ratio, plus a SOFR adjustment of 10 basis points. The margins for the Revolving Credit Facility are subject to adjustment based on changes in the Company's leverage ratio and credit ratings. In addition, in connection with the Company's ongoing environmental, social and governance ("ESG") initiatives, pricing on the Revolving Credit Facility may be reduced if specific ESG rating improvements are achieved.

Previous wording

The Company’s First Amendment to the Third Amended and Restated Revolving Credit Agreement provides for a $1.00 billion Revolving Credit Facility and converted the interest rate on the existing $1.00 billion Revolving Credit Facility from a spread over LIBOR to a spread over SOFR plus a SOFR adjustment of 10 basis points. The Revolving Credit Facility includes an accordion option that allows the Company to request additional lender commitments up to a total of $1.75 billion. The Revolving Credit Facility will mature in January 2026 with Company options to extend the maturity date to January 2027.

Current wording

The Revolving Credit Facility includes an accordion option that allows the Company to request additional lender commitments up to a total of $2.00 billion. The Revolving Credit Facility will mature in August 2028 with Company options to extend the maturity date to August 2029.

Previous wording

The Company expects to meet its short-term liquidity requirements through cash and cash equivalents held as of June 30, 2024, cash provided from operations, and borrowings under its revolving credit facility. As of June 30, 2024, available cash and cash equivalents, including cash held in escrow, was $24.3 million. As of June 30, 2024, the Company had $43.0 million outstanding on its revolving credit facility and $957.0 million available for future borrowings, subject to its compliance with covenants.

Current wording

The Company expects to meet its short-term liquidity requirements through cash and cash equivalents held as of September 30, 2024, cash provided from operations, and borrowings under its revolving credit facility. As of September 30, 2024, available cash and cash equivalents, including cash held in escrow, was $13.2 million. As of September 30, 2024, the Company had $49.0 million outstanding on its revolving credit facility and $1.20 billion available for future borrowings, subject to its compliance with covenants.

Previous wording

We continually evaluate alternative financing and believe that we can obtain financing on reasonable terms. However, there can be no assurance that additional financing or capital will be available, or that the terms will be acceptable or advantageous to us. Our ability to access capital on favorable terms as well as to use cash from operations to continue to meet our liquidity needs is uncertain and cannot be predicted and could be affected by various risks and uncertainties, including, but not limited to the risks detailed in Part I, Item 1A titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 and in the other reports the Company has filed with the Securities and Exchange Commission (“SEC”).

Current wording

advantageous to us. Our ability to access capital on favorable terms as well as to use cash from operations to continue to meet our liquidity needs is uncertain and cannot be predicted and could be affected by various risks and uncertainties, including, but not limited to the risks detailed in Part I, Item 1A titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 and in the other reports the Company has filed with the Securities and Exchange Commission (“SEC”).

Previous wording

As of June 30, 2024, the Company’s total enterprise value was approximately $9.10 billion. Total enterprise value consisted of $6.25 billion of common equity (based on the June 30, 2024 closing price of the Company’s common stock on the NYSE of $61.94 per common share and assuming the conversion of Operating Partnership Common Units), $175.0 million of preferred equity (stated at liquidation value) and $2.70 billion of total debt principal including (i) $43.0 million of borrowings under its revolving credit facility; (ii) $2.26 billion of senior unsecured notes; (iii) $350.0 million under its unsecured term loan; (iv) $44.4 million of mortgage notes payable; less $24.3 million cash, cash equivalents and cash held in escrow. The Company’s total debt principal to total enterprise value was 29.6% as of June 30, 2024.

Current wording

As of September 30, 2024, the Company’s total enterprise value was approximately $10.69 billion. Total enterprise value consisted of $7.82 billion of common equity (based on the September 30, 2024 closing price of the Company’s common stock on the NYSE of $75.33 per common share and assuming the conversion of Operating Partnership Common Units), $175.0 million of preferred equity (stated at liquidation value) and $2.70 billion of total debt principal including (i) $49.0 million of borrowings under its Revolving Credit Facility; (ii) $2.26 billion of senior unsecured notes; (iii) $350.0 million under its unsecured term loan; (iv) $44.2 million of mortgage notes payable; less $13.2 million cash, cash equivalents and cash held in escrow. The Company’s total debt principal to total enterprise value was 25.3% as of September 30, 2024.

Previous wording

At June 30, 2024, the non-controlling interest in the Operating Partnership consisted of a 0.3% common ownership interest in the Operating Partnership. The Operating Partnership Common Units may, under certain circumstances, be exchanged for shares of Company common stock on a one-for-one basis. The Company, as sole general partner of the Operating Partnership, has the option to settle exchanged Operating Partnership Common Units held by others for cash based on the current trading price of our shares. Assuming the exchange of all Operating Partnership Common Units, there would have been 100,972,243 shares of common stock outstanding as of June 30, 2024.

Current wording

At September 30, 2024, the non-controlling interest in the Operating Partnership consisted of a 0.3% common ownership interest in the Operating Partnership. The Operating Partnership Common Units may, under certain circumstances, be exchanged for shares of Company common stock on a one-for-one basis. The Company, as sole general partner of the Operating Partnership, has the option to settle exchanged Operating Partnership Common Units held by others for cash based on the current trading price of our shares. Assuming the exchange of all Operating Partnership Common Units, there would have been 103,870,296 shares of common stock outstanding as of September 30, 2024.

Previous wording

In February 2024, the Company entered into a $1.00 billion ATM program (the “2024 ATM Program”). As of June 30, 2024, the Company has entered into forward sale agreements to sell an aggregate of 3,235,964 shares of common stock, for anticipated net proceeds of $194.5 million. During the six months ended June 30, 2024, the Company did not settle any of the outstanding shares of these forward sales agreements. The Company is required to settle the outstanding shares of common stock under the 2024 ATM Program between May 2025 and July 2025. After considering the shares of common stock sold subject to forward sale agreements under the 2024 ATM Program, the Company had approximately $803.3 million of availability under the 2024 ATM Program as of June 30, 2024.

Current wording

In February 2024, the Company entered into a $1.00 billion ATM program (the “2024 ATM Program”). As of September 30, 2024, the Company has entered into forward sale agreements to sell an aggregate of 9,838,281 shares of common stock, for anticipated net proceeds of $664.1 million. During the three and nine months ended September 30, 2024, the Company settled 2,100,000 shares of these forward sales agreements for net proceeds of $126.4 million. The Company is required to settle the outstanding shares of common stock under the 2024 ATM Program between May 2025 and October 2025. After considering the shares of common stock sold subject to forward sale agreements under the 2024 ATM Program, the Company had approximately $328.8 million of availability under the 2024 ATM Program as of September 30, 2024.

Previous wording

Since the inception of the 2022 ATM Program and through the adoption of the 2024 ATM Program on February 16, 2024, the Company entered into forward sale agreements to sell an aggregate of 10,217,973 shares of common stock under the 2022 ATM Program, for anticipated net proceeds of $670.0 million. Through December 31, 2023, the Company settled 6,363,359 shares of these forward sale agreements for net proceeds of approximately $433.4 million, after deducting fees and expenses. During the six months ended June 30, 2024, the Company did not settle any of the remaining outstanding shares. The Company is required to settle the remaining outstanding shares of common stock under the 2022 ATM Program by January 2025.

Current wording

Since the inception of the 2022 ATM Program in September 2022 and through the adoption of the 2024 ATM Program on February 16, 2024, the Company entered into forward sale agreements to sell an aggregate of 10,217,973 shares of common stock under the 2022 ATM Program, for anticipated net proceeds of $670.0 million. Through December 31, 2023, the Company settled 6,363,359 shares of these forward sale agreements for net proceeds of $433.4 million, after deducting fees and expenses. During the three and nine months ended September 30, 2024, the Company settled 800,000 shares of these forward sales agreements for net proceeds of $49.3 million. The Company is required to settle the remaining outstanding shares of common stock under the 2022 ATM Program by January 2025.

Previous wording

The below table summarizes the Company’s outstanding debt as of June 30, 2024 and December 31, 2023 (presented in thousands):

Current wording

The table below summarizes the Company’s outstanding debt as of September 30, 2024 and December 31, 2023 (presented in thousands):

Previous wording

(1) The interest rate of the Revolving Credit Facility assumes SOFR as of June 30, 2024 of 5.34%.

Current wording

(1) The interest rate of the Revolving Credit Facility assumes SOFR as of September 30, 2024 of 4.83%.

Previous wording

As of June 30, 2024, the Company had total gross mortgage indebtedness of $44.4 million which was collateralized by related real estate and tenants’ leases with an aggregate net book value of $77.8 million. The weighted average interest rate on the Company’s mortgage notes payable was 3.76% as of June 30, 2024.

Current wording

As of September 30, 2024, the Company had total gross mortgage indebtedness of $44.2 million which was collateralized by related real estate and tenants’ leases with an aggregate net book value of $77.0 million. The weighted average interest rate on the Company’s mortgage notes payable was 3.74% as of September 30, 2024.

Previous wording

The Company has entered into mortgage loans which are secured by multiple properties and contain cross-default and cross-collateralization provisions. Cross-collateralization provisions allow a lender to foreclose on multiple properties in the event that the Company defaults under the loan. Cross-default provisions allow a lender to foreclose on the related property in the event a default is declared under another loan.

Current wording

The Company has entered into mortgage loans which are secured by multiple properties and contain cross-default and cross-collateralization provisions. Cross-collateralization provisions allow a lender to foreclose on multiple properties in the event that the Company defaults under the loan. Cross-default provisions allow a lender to foreclose on the related

Previous wording

Operating - Most of the Company’s cash from operations is generated by rental income from its investment portfolio. Net cash provided by operating activities for the six months ended June 30, 2024 increased by $16.4 million over the same period in 2023, primarily due to the increase in the size of the Company’s real estate investment portfolio.

Current wording

Operating - Most of the Company’s cash from operations is generated by rental income from its investment portfolio. Net cash provided by operating activities for the nine months ended September 30, 2024 increased by $47.0 million over the same period in 2023, primarily due to the increase in the size of the Company’s real estate investment portfolio.

Previous wording

Investing - Net cash used in investing activities was $373.1 million lower during the six months ended June 30, 2024, compared to the same period in 2023 primarily due to:

Current wording

Investing - Net cash used in investing activities was $546.6 million lower during the nine months ended September 30, 2024, compared to the same period in 2023 primarily due to:

Previous wording

Financing - Net cash provided by financing activities decreased by $363.1 million during the six months ended June 30, 2024, compared to the same period in 2023 primarily due to:

Current wording

Financing - Net cash provided by financing activities decreased by $572.4 million during the nine months ended September 30, 2024, compared to the same period in 2023 primarily due to:

Previous wording

Detail on these obligations as of June 30, 2024, including expected settlement periods, is contained below (presented in thousands):

Current wording

Details on these obligations as of September 30, 2024, including expected settlement periods, is contained below (presented in thousands):

Previous wording

During the six months ended June 30, 2024 the Company had 25 development or DFP projects completed or under construction, for which 19 remain under construction as of June 30, 2024. Anticipated total costs for the 19 projects are approximately $77.8 million. These construction commitments will be funded using cash provided from operations, current capital resources on hand, and/or other sources of funding available to the Company.

Current wording

During the nine months ended September 30, 2024 the Company had 33 development or DFP projects completed or under construction, for which 21 remain under construction as of September 30, 2024. Anticipated total costs for the 21 projects are approximately $92.7 million. These construction commitments will be funded using cash provided from operations, current capital resources on hand, and/or other sources of funding available to the Company.

Previous wording

During the quarter ended June 30, 2024, the Company declared monthly dividends of $0.250 per common share for April, May and June 2024. The holder of the Operating Partnership Common Units is entitled to an equal distribution per Operating Partnership Common Unit held. The dividends and distributions payable for April and May were paid during the three months ended June 30, 2024, while June dividends and distributions were recorded as a liability on the condensed consolidated balance sheet at June 30, 2024 and were paid on July 15, 2024.

Current wording

During the quarter ended September 30, 2024, the Company declared monthly dividends of $0.250 per common share for July, August and September 2024. The holder of the Operating Partnership Common Units is entitled to an equal distribution per Operating Partnership Common Unit held. The dividends and distributions payable for July and August were paid during the three months ended September 30, 2024, while September dividends and distributions were recorded as a liability on the condensed consolidated balance sheet at September 30, 2024 and were paid on October 15, 2024.

Previous wording

During the quarter ended June 30, 2024, the Company declared monthly dividends on the Series A Preferred Shares for April, May and June 2024. The dividends payable for April and May were paid during the quarter. The June dividend was recorded as a liability on the condensed consolidated balance sheet at June 30, 2024 and was paid on July 1, 2024.

Current wording

During the quarter ended September 30, 2024, the Company declared monthly dividends on the Series A Preferred Shares for July, August and September 2024. The dividends payable for July and August were paid during the quarter. The September dividend was recorded as a liability on the condensed consolidated balance sheet at September 30, 2024 and was paid on October 1, 2024.

Previous wording

The following table provides a reconciliation of net income to FFO, Core FFO and AFFO for the three and six months ended June 30, 2024 and 2023 (presented in thousands):

Current wording

The following table provides a reconciliation of net income to FFO, Core FFO and AFFO for the three and nine months ended September 30, 2024 and 2023 (presented in thousands):