8-K
NNN REIT, INC. (NNN)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 5, 2025
NNN REIT, INC.
(exact name of registrant as specified in its charter)
| Maryland | 001-11290 | 56-1431377 |
|---|---|---|
| (State or other jurisdiction of<br><br>incorporation or organization) | (Commission<br><br>File Number) | (I.R.S. Employment<br><br>Identification No.) |
450 South Orange Avenue, Suite 900, Orlando, Florida 32801
(Address of principal executive offices, including zip code)
(407) 265-7348
(Registrant’s telephone number, including area code)
Not applicable
(Former name or former address if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of exchange on which registered |
|---|---|---|
| Common Stock, $0.01 par value | NNN | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02. | Results of Operations and Financial Condition. |
|---|
On August 5, 2025, NNN REIT, Inc. (the "Company") issued a press release announcing its results of operations and financial condition for the quarter and six months ended June 30, 2025. The press release is attached hereto as Exhibit 99.1. The press release is available on the Company's website.
The information in this Form 8-K is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), as amended, or otherwise subject to the liabilities of such section, nor shall such information be deemed to be incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
| Item 9.01. | Financial Statements and Exhibits. |
|---|
(d) Exhibits.
| 99.1 | Press Release, dated August 5, 2025, of NNN REIT, Inc. |
|---|---|
| 104.1 | Cover Page Interactive Data File (the Cover Page Interactive Data File is embedded within the Inline XBRL document) |
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| NNN REIT, Inc. | ||
|---|---|---|
| Dated: August 5, 2025 | By: | /s/ Vincent H. Chao |
| Vincent H. Chao | ||
| Executive Vice President and Chief Financial Officer |
EX-99.1
Exhibit 99.1
NEWS RELEASE
For information contact:
Vincent H. Chao
Chief Financial Officer
| (407) 265-7348 | FOR IMMEDIATE RELEASE |
|---|
August 5, 2025
NNN REIT, Inc. Announces Second Quarter 2025 Results and Increased 2025 Guidance
Orlando, Florida, August 5, 2025 – NNN REIT, Inc. (NYSE: NNN) (the "Company" or "NNN"), a real estate investment trust, today announced financial and operating results for the quarter and six months ended June 30, 2025. Highlights include:
Second Quarter 2025 Highlights:
- Reported net earnings of $0.54 per diluted share
- Grew Core FFO and AFFO per diluted share by 1.2% over prior year results, to $0.84 and $0.85, respectively
- Increased ABR by 6.7% over prior year results
- Closed on $232.5 million of investments at an initial cash cap rate of 7.4%, with a weighted average lease term of 17.8 years and $464.9 million of investments in the six months ended June 30, 2025, equating to 85% of the initial full year acquisition plan at the midpoint
- Sold 23 properties for $51.2 million, including $24.7 million of income producing properties at a weighted average cap rate of 6.2%
- Raised $10.9 million in gross proceeds from the issuance of 254,222 common shares at an average price per share of $43.03
- Improved balance sheet flexibility, following the end of the quarter, through the issuance of $500 million principal amount of 4.600% senior unsecured notes due 2031 ("2031 Notes") and the repayment of the outstanding balance on the unsecured revolving line of credit
- Pro forma for the 2031 Notes, the Company had a sector leading weighted average debt maturity of 11.0 years, no encumbered assets, no floating rate debt and $1.4 billion of total available liquidity
- Paid a $0.58 quarterly dividend, equating to a 5.4% annualized dividend yield and 68% AFFO payout ratio
Additional Highlights:
- Announced a 3.4% increase in the third quarter 2025 quarterly dividend to $0.60 per share, marking the Company's 36th consecutive annual dividend increase
- Published the Company's third annual Corporate Sustainability Report
- Increased the midpoint of 2025 Core FFO and AFFO per share guidance by $0.01
- Increased 2025 acquisition volume guidance by $100 million
Steve Horn, Chief Executive Officer, commented: "NNN delivered another strong quarter, investing $233 million across 45 properties, at an accretive initial cash cap rate of 7.4%. With over $460 million of real estate investments completed in the first half of 2025 and nearly $1.5 billion of immediate liquidity following our note offering at the end of the quarter, we are well-positioned to raise our 2025 Core FFO guidance and execute our strategy through year end."
FINANCIAL RESULTS
Revenues and net earnings, FFO, Core FFO and AFFO and diluted per share amounts:
| Quarter Ended<br>June 30, | Six Months Ended<br>June 30, | |||||||
|---|---|---|---|---|---|---|---|---|
| (dollars in thousands, except per share data) | 2025 | 2024 | 2025 | 2024 | ||||
| Revenues | $ | 226,802 | $ | 216,813 | $ | 457,656 | $ | 432,220 |
| Net earnings | $ | 100,529 | $ | 106,666 | $ | 196,987 | $ | 201,037 |
| Net earnings per share | $ | 0.54 | $ | 0.58 | $ | 1.05 | $ | 1.10 |
| FFO | $ | 157,175 | $ | 152,380 | $ | 315,909 | $ | 303,641 |
| FFO per share | $ | 0.84 | $ | 0.83 | $ | 1.69 | $ | 1.66 |
| Core FFO | $ | 157,366 | $ | 152,533 | $ | 318,273 | $ | 304,111 |
| Core FFO per share | $ | 0.84 | $ | 0.83 | $ | 1.70 | $ | 1.67 |
| AFFO | $ | 158,523 | $ | 153,596 | $ | 321,538 | $ | 306,855 |
| AFFO per share | $ | 0.85 | $ | 0.84 | $ | 1.72 | $ | 1.68 |
PORTFOLIO SNAPSHOT
| (dollars in thousands) | June 30, 2025 | March 31, 2025 | June 30, 2024 | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Number of properties | 3,663 | 3,641 | 3,548 | ||||||
| Total gross leasable area (square feet) | 38,322,000 | 37,311,000 | 36,095,000 | ||||||
| Occupancy rate | 98.0 | % | 97.7 | % | 99.3 | % | |||
| Weighted average remaining lease term (years) | 9.8 | 9.9 | 10.0 | ||||||
| ABR | $ | 893,782 | $ | 874,301 | $ | 837,568 |
PROPERTY ACQUISITIONS
| (dollars in thousands) | Quarter Ended June 30, 2025 | Six Months Ended June 30, 2025 | ||||
|---|---|---|---|---|---|---|
| Total dollars invested(1) | $ | 232,536 | $ | 464,929 | ||
| Number of properties | 45 | 127 | ||||
| Gross leasable area (square feet)(2) | 1,399,000 | 2,230,000 | ||||
| Weighted average cap rate(3) | 7.4 | % | 7.4 | % | ||
| Weighted average lease term (years) | 17.8 | 18.0 | ||||
| (1) | Includes dollars invested in projects under construction or tenant improvements. | |||||
| --- | --- | |||||
| (2) | Includes additional square footage from completed construction on existing properties. | |||||
| (3) | Calculated as the initial cash annual base rent divided by the total purchase price of the properties. |
PROPERTY DISPOSITIONS
| Quarter Ended June 30, 2025 | Six Months Ended June 30, 2025 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (dollars in thousands) | Occupied | Vacant | Total | Occupied | Vacant | Total | ||||||||||
| Number of properties | 10 | 13 | 23 | 19 | 14 | 33 | ||||||||||
| Gross leasable area (square feet) | 162,000 | 196,000 | 358,000 | 220,000 | 210,000 | 430,000 | ||||||||||
| Net sale proceeds | $ | 24,727 | $ | 26,521 | $ | 51,248 | $ | 38,067 | $ | 29,020 | $ | 67,087 | ||||
| Weighted average cap rate(1) | 6.2 | % | — | 6.2 | % | 5.7 | % | — | 5.7 | % | ||||||
| (1) | Calculated as the cash annual base rent divided by the total gross proceeds received for the properties. | |||||||||||||||
| --- | --- |
CAPITAL MARKETS ACTIVITY
During the second quarter 2025, NNN issued 254,222 common shares, raising $10.9 million in gross proceeds at an average price per share of $43.03, primarily through the Company's at-the-market equity program.
On July 1, 2025, NNN issued the 2031 Notes and used the proceeds from the offering to repay the outstanding balance on the Company's unsecured revolving line of credit.
BALANCE SHEET AND LIQUIDITY
As of June 30, 2025, Gross Debt was $4.7 billion with a weighted average interest rate of 4.2% and a weighted average debt maturity of 11.1 years. The Company ended the second quarter 2025 with $939.0 million of total available liquidity, comprised of $932.3 million of unused line of credit capacity and $6.7 million of cash and restricted cash. Pro forma for the 2031 Notes, the Company had total available liquidity of $1.4 billion, comprised of $1.2 billion of unused line of credit capacity and $230.8 million of cash and restricted cash. Net Debt to annualized EBITDAre and fixed charge coverage was 5.7x and 4.2x, respectively, as of June 30, 2025.
DIVIDEND
As previously announced, on July 15, 2025, the Board of Directors of NNN declared a quarterly dividend of $0.60 per share payable August 15, 2025, to shareholders of record as of July 31, 2025. The new quarterly dividend represents an annualized dividend of $2.40 per share with an annualized dividend yield of 5.6% as of June 30, 2025. The 3.4% increase in the quarterly dividend marks the Company's 36th consecutive annual dividend increase. NNN is one of only three publicly traded real estate investment trusts to have increased annual dividends for 36 or more consecutive years.
2025 GUIDANCE
The Company increased previously provided 2025 guidance as summarized below:
| (dollars in millions, except per diluted share data) | Previous 2025 <br>Guidance | Updated 2025 <br>Guidance |
|---|---|---|
| Net earnings per share excluding any gains on disposition of real estate, <br> impairment losses and retirement and severance costs | $1.97 - $2.02 | $1.93 - $1.98 |
| Real estate depreciation and amortization per share | $1.36 | $1.41 |
| Core FFO per share | $3.33 - $3.38 | $3.34 - $3.39 |
| AFFO per share | $3.39 - $3.44 | $3.40 - $3.45 |
| General and administrative expenses | $47 - $48 | $47 - $48 |
| Real estate expenses, net of tenant reimbursements | $15 - $16 | $17 - $18 |
| Acquisition volume | $500 - $600 | $600 - $700 |
| Disposition volume | $80 - $120 | $120 - $150 |
Guidance is based on current plans and assumptions and is subject to risks and uncertainties more fully described in this press release and the Company's reports filed with the Securities and Exchange Commission (the "Commission").
CONFERENCE CALL INFORMATION
The Company will host a conference call on Tuesday, August 5, 2025 at 10:30 a.m. ET to discuss second quarter results. A live webcast of the conference call will be available on the Company's website at www.nnnreit.com or by using the following link. The conference call can also be accessed by dialing 888-506-0062 in the U.S. or 973-528-0011 for international callers and entering the participant code 385344 or referencing NNN REIT, Inc.
A telephonic replay of the call will be available through August 12, 2025, by dialing 877-481-4010 in the U.S. or 919-882-2331 internationally and entering the code 52652.
ABOUT NNN REIT, INC.
NNN invests in high-quality properties subject generally to long-term, net leases with minimal ongoing capital expenditures. As of June 30, 2025, the Company owned 3,663 properties in 50 states with a gross leasable area of approximately 38.3 million square feet and a weighted average remaining lease term of 10 years. NNN is one of only three publicly traded real estate investment trusts to have increased annual dividends for 36 or more consecutive years. For more information on the Company, visit www.nnnreit.com.
FORWARD-LOOKING STATEMENTS
Statements in this press release that are not strictly historical are “forward-looking” statements. These statements generally are characterized by the use of terms such as "believe," "expect," "intend," "may," "estimated" or other similar words or expressions. Forward-looking statements involve known and unknown risks, which may cause the Company’s actual future results to differ materially from expected results. These risks include, among others, general economic conditions, including inflation, local real estate conditions, changes in interest rates, increases in operating costs, the preferences and financial condition of the Company's tenants, the availability of capital, risks related to the Company's status as a real estate investment trust ("REIT"), and the potential impacts of an epidemic or pandemic on the Company’s business operations, financial results and financial position on the world economy. Additional information concerning these and other factors that could cause actual results to differ materially from these forward-looking statements is contained from time to time in the Company’s Commission filings, including, but not limited to, the Company’s (i) Annual Report on Form 10-K for the year ended December 31, 2024 and (ii) Quarterly Report on Form 10-Q for the quarters ended March 31, 2025 and June 30, 2025. Copies of each filing may be obtained from the Company or the Commission. Such forward-looking statements should be regarded solely as reflections of the Company’s current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. NNN REIT, Inc. undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.
DEFINITIONS
Funds From Operations ("FFO") is a relative non-GAAP financial measure of operating performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO is defined by the National Association of Real Estate Investment Trusts (“Nareit”) and is used by the Company as follows: net earnings (computed in accordance with GAAP) plus depreciation and amortization of assets unique to the real estate industry, excluding gains (or including losses), any applicable taxes on the disposition of certain assets and any impairment charges on a depreciable real estate asset, net of recoveries.
FFO is generally considered by industry analysts to be the most appropriate measure of performance of real estate companies. FFO does not necessarily represent cash provided by operating activities in accordance with GAAP and should not be considered an alternative to net earnings as an indication of the Company’s performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers FFO an appropriate measure of performance of an equity REIT because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure.
Core Funds From Operations (“Core FFO”) is a non-GAAP measure of operating performance that adjusts FFO to eliminate the impact of certain GAAP income and expense amounts that the Company believes are infrequent and unusual in nature and/or not related to its core real estate operations. Exclusion of these items from similar FFO-type metrics is common within the REIT industry, and management believes that presentation of Core FFO provides investors with a potential metric to assist in their evaluation of the Company’s operating performance across multiple periods and in comparison to the operating performance of its peers because it removes the effect of unusual items that are not expected to impact the Company’s operating performance on an ongoing basis. Core FFO is used by management in evaluating the performance of the Company’s core business operations and is a factor in determining management compensation. Items included in calculating FFO that may be excluded in calculating Core FFO may include items such as transaction related gains, income or expense, impairments on land, retirement and severance costs or other non-core amounts as they occur.
Adjusted Funds From Operations (“AFFO”) is a non-GAAP financial measure of operating performance used by many companies in the REIT industry. AFFO adjusts FFO for certain non-cash items that reduce or increase net earnings in accordance with GAAP. AFFO should not be considered an alternative to net earnings, as an indication of the Company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers AFFO a useful supplemental measure of the Company’s performance.
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate as defined by Nareit (“EBITDAre”) is a metric established by Nareit and commonly used by real estate companies. The measure is a result of net earnings (computed in accordance with GAAP), plus interest expense, income tax expense, depreciation and amortization, excluding any gains (or including any losses) on disposition of real estate, any impairment charges, net of recoveries and after adjustments for income and losses attributable to noncontrolling interests. Management considers the non-GAAP measure of EBITDAre to be an appropriate measure of the Company's performance and should be considered in addition to, net earnings or loss, as a measure of the Company's operating performance.
Total Cash is comprised of cash and cash equivalents and restricted cash and cash held in escrow per GAAP as reported on the balance sheet summary.
Gross Assets represents total assets (reported in accordance with GAAP) adjusted to exclude accumulated amortization and depreciation and amortization of direct financing leases. The result provides an estimate of the investments made by the Company.
Total Debt is defined by the Company as total debt per GAAP as reported on the balance sheet summary including line of credit payable, notes payable, net of unamortized discount and unamortized debt costs and mortgages payable, net of unamortized premium and debt costs, as applicable.
Gross Debt is defined by the Company as Total Debt adjusted to exclude unamortized debt discounts and premiums and unamortized debt costs.
Net Debt is defined by the Company as Gross Debt less Total Cash.
Management considers the non-GAAP measures of Gross Debt and Net Debt each to be a key supplemental measure of the Company's overall liquidity, capital structure and leverage.
The Company’s computation of FFO, Core FFO, AFFO, EBITDAre, Total Cash, Gross Assets, Gross Debt and Net Debt may differ from the methodology for calculating these non-GAAP financial measures used by other REITs, and therefore, may not be comparable to such other REITs. Reconciliations of net earnings, Total Debt and total assets (all computed in accordance with GAAP) to FFO, Core FFO, AFFO, EBITDAre, Gross Assets, Gross Debt and Net Debt (each of which is a non-GAAP financial measure), as applicable, are included in the financial information accompanying this release.
Annualized Base Rent (“ABR”) represents the monthly cash base rent for all leases in place as of the end of the period multiplied by 12. Accordingly, this methodology produces an annualized amount as of a point in time but does not take into consideration future (i) scheduled rent increases, (ii) leasing activity, or (iii) lease expirations.
NNN REIT, Inc.
Balance Sheet Summary
(dollars in thousands)
(unaudited)
| December 31,<br>2024 | |||
|---|---|---|---|
| Assets: | |||
| Real estate portfolio, net of accumulated depreciation and amortization | 9,023,171 | $ | 8,746,168 |
| Cash and cash equivalents | 5,973 | 8,731 | |
| Restricted cash and cash held in escrow | 775 | 331 | |
| Receivables, net of allowance of 599 and 617, respectively | 2,499 | 2,975 | |
| Accrued rental income, net of allowance of 3,290 and 4,156, respectively | 33,594 | 34,005 | |
| Debt costs, net of accumulated amortization of 28,449 and 27,002, respectively | 7,698 | 8,958 | |
| Other assets | 74,967 | 71,560 | |
| Total assets | 9,148,677 | $ | 8,872,728 |
| Liabilities: | |||
| Line of credit payable | 267,700 | $ | — |
| Notes payable, net of unamortized discount and unamortized debt costs | 4,376,893 | 4,373,803 | |
| Accrued interest payable | 30,685 | 29,699 | |
| Other liabilities | 110,994 | 106,951 | |
| Total liabilities | 4,786,272 | 4,510,453 | |
| Total equity | 4,362,405 | 4,362,275 | |
| Total liabilities and equity | 9,148,677 | $ | 8,872,728 |
| Common shares outstanding | 188,206,484 | 187,540,929 |
All values are in US Dollars.
NNN REIT, Inc.
Income Statement Summary
(dollars in thousands, except per share data)
(unaudited)
| Quarter Ended<br>June 30, | Six Months Ended<br>June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |||||||||
| Revenues: | ||||||||||||
| Rental income | $ | 226,498 | $ | 216,140 | $ | 457,072 | $ | 430,965 | ||||
| Interest and other income from real estate transactions | 304 | 673 | 584 | 1,255 | ||||||||
| 226,802 | 216,813 | 457,656 | 432,220 | |||||||||
| Operating expenses: | ||||||||||||
| General and administrative | 11,217 | 11,789 | 24,225 | 24,373 | ||||||||
| Real estate | 8,838 | 6,758 | 18,213 | 13,912 | ||||||||
| Depreciation and amortization | 68,349 | 62,503 | 132,966 | 123,118 | ||||||||
| Leasing transaction costs | 74 | 20 | 204 | 53 | ||||||||
| Impairment losses – real estate, net of recoveries | 4,535 | 944 | 6,047 | 2,148 | ||||||||
| Retirement and severance costs | 191 | 153 | 2,364 | 470 | ||||||||
| 93,204 | 82,167 | 184,019 | 164,074 | |||||||||
| Gain on disposition of real estate | 16,198 | 17,621 | 20,011 | 22,442 | ||||||||
| Earnings from operations | 149,796 | 152,267 | 293,648 | 290,588 | ||||||||
| Other expenses (revenues): | ||||||||||||
| Interest and other income | (15 | ) | (976 | ) | (344 | ) | (1,095 | ) | ||||
| Interest expense | 49,282 | 46,577 | 97,005 | 90,646 | ||||||||
| 49,267 | 45,601 | 96,661 | 89,551 | |||||||||
| Net earnings | $ | 100,529 | $ | 106,666 | $ | 196,987 | $ | 201,037 | ||||
| Weighted average shares outstanding: | ||||||||||||
| Basic | 186,876,693 | 182,438,791 | 186,865,955 | 182,119,471 | ||||||||
| Diluted | 187,070,288 | 182,807,374 | 187,088,160 | 182,528,333 | ||||||||
| Net earnings per share available to stockholders: | ||||||||||||
| Basic | $ | 0.54 | $ | 0.58 | $ | 1.05 | $ | 1.10 | ||||
| Diluted | $ | 0.54 | $ | 0.58 | $ | 1.05 | $ | 1.10 |
NNN REIT, Inc.
Other Information
(dollars in thousands)
(unaudited)
| Quarter Ended<br>June 30, | Six Months Ended<br>June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |||||||||
| Rental income from operating leases(1) (2) | $ | 221,714 | $ | 211,557 | $ | 445,770 | $ | 420,641 | ||||
| Earned income from direct financing leases(1) | $ | 112 | $ | 118 | $ | 226 | $ | 237 | ||||
| Percentage rent(1) | $ | 284 | $ | 259 | $ | 1,170 | $ | 1,147 | ||||
| Real estate expenses reimbursed from tenants(1) | $ | 4,388 | $ | 4,206 | $ | 9,906 | $ | 8,940 | ||||
| Real estate expenses | (8,838 | ) | (6,758 | ) | (18,213 | ) | (13,912 | ) | ||||
| Real estate expenses, net of tenant reimbursements | $ | (4,450 | ) | $ | (2,552 | ) | $ | (8,307 | ) | $ | (4,972 | ) |
| Amortization of debt costs | $ | 1,478 | $ | 1,787 | $ | 2,944 | $ | 3,088 | ||||
| Non-real estate depreciation expense | $ | 43 | $ | 115 | $ | 86 | $ | 226 | ||||
| (1) | For the quarters ended June 30, 2025 and 2024, the aggregate of such amounts is $226,498 and $216,140, respectively, and $457,072 and $430,965, for the six months ended June 30, 2025 and 2024, respectively, and is classified as rental income on the income statement summary. | |||||||||||
| --- | --- | |||||||||||
| (2) | Includes lease termination fees of $2,248 and $2,053 for the quarters ended June 30, 2025 and 2024, respectively, and $10,452 and $6,292 for the six months ended June 30, 2025 and 2024, respectively. |
NNN REIT, Inc.
Reconciliation of Non-GAAP Financial Measures
(dollars in thousands, except per share data)
(unaudited)
| Quarter Ended<br>June 30, | Six Months Ended<br>June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |||||||||
| Net earnings | $ | 100,529 | $ | 106,666 | $ | 196,987 | $ | 201,037 | ||||
| Real estate depreciation and amortization | 68,309 | 62,391 | 132,886 | 122,898 | ||||||||
| Gain on disposition of real estate | (16,198 | ) | (17,621 | ) | (20,011 | ) | (22,442 | ) | ||||
| Impairment losses – depreciable real estate, net of <br> recoveries | 4,535 | 944 | 6,047 | 2,148 | ||||||||
| FFO | 157,175 | 152,380 | 315,909 | 303,641 | ||||||||
| Retirement and severance costs | 191 | 153 | 2,364 | 470 | ||||||||
| Core FFO | 157,366 | 152,533 | 318,273 | 304,111 | ||||||||
| Straight-line accrued rent, net of reserves | 425 | 95 | (84 | ) | 131 | |||||||
| Net capital lease rent adjustment | 62 | 54 | 122 | 108 | ||||||||
| Below-market rent amortization | (1,620 | ) | (125 | ) | (1,713 | ) | (242 | ) | ||||
| Stock based compensation expense | 2,832 | 2,656 | 6,403 | 6,223 | ||||||||
| Capitalized interest expense | (542 | ) | (1,617 | ) | (1,463 | ) | (3,476 | ) | ||||
| AFFO | $ | 158,523 | $ | 153,596 | $ | 321,538 | $ | 306,855 | ||||
| FFO per share: | ||||||||||||
| Basic | $ | 0.84 | $ | 0.84 | $ | 1.69 | $ | 1.67 | ||||
| Diluted | $ | 0.84 | $ | 0.83 | $ | 1.69 | $ | 1.66 | ||||
| Core FFO per share: | ||||||||||||
| Basic | $ | 0.84 | $ | 0.84 | $ | 1.70 | $ | 1.67 | ||||
| Diluted | $ | 0.84 | $ | 0.83 | $ | 1.70 | $ | 1.67 | ||||
| AFFO per share: | ||||||||||||
| Basic | $ | 0.85 | $ | 0.84 | $ | 1.72 | $ | 1.68 | ||||
| Diluted | $ | 0.85 | $ | 0.84 | $ | 1.72 | $ | 1.68 | ||||
| Dividend per share | $ | 0.5800 | $ | 0.5650 | $ | 1.1600 | $ | 1.1300 | ||||
| AFFO payout ratio(1) | 68 | % | 67 | % | 67 | % | 67 | % | ||||
| (1) | Calculated as total dividends paid as a percentage of AFFO for each respective period. | |||||||||||
| --- | --- |
NNN REIT, Inc.
Reconciliation of Non-GAAP Financial Measures (continued)
(dollars in thousands, except per share data)
(unaudited)
| Quarter Ended<br>June 30, | Six Months Ended<br>June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |||||||||
| Net earnings | $ | 100,529 | $ | 106,666 | $ | 196,987 | $ | 201,037 | ||||
| Interest expense | 49,282 | 46,577 | 97,005 | 90,646 | ||||||||
| Depreciation and amortization | 68,349 | 62,503 | 132,966 | 123,118 | ||||||||
| Gain on disposition of real estate | (16,198 | ) | (17,621 | ) | (20,011 | ) | (22,442 | ) | ||||
| Impairment losses – real estate, net of <br> recoveries | 4,535 | 944 | 6,047 | 2,148 | ||||||||
| EBITDAre | $ | 206,497 | $ | 199,069 | $ | 412,994 | $ | 394,507 | ||||
| Interest expense | $ | 49,282 | $ | 46,577 | $ | 97,005 | $ | 90,646 | ||||
| Add back: capitalized interest | 542 | 1,617 | 1,463 | 3,476 | ||||||||
| Fixed charges | $ | 49,824 | $ | 48,194 | $ | 98,468 | $ | 94,122 | ||||
| June 30,<br>2025 | December 31,<br>2024 | |||||||||||
| Total assets | $ | 9,148,677 | $ | 8,872,728 | ||||||||
| Accumulated depreciation & amortization | 2,171,731 | 2,065,520 | ||||||||||
| Amortization of direct financing leases | 2,777 | 2,655 | ||||||||||
| Gross Assets | $ | 11,323,185 | $ | 10,940,903 | ||||||||
| Debt outstanding: | ||||||||||||
| Line of credit | $ | 267,700 | $ | — | ||||||||
| Notes payable, net of unamortized discount and <br> unamortized debt costs | 4,376,893 | 4,373,803 | ||||||||||
| Total Debt | 4,644,593 | 4,373,803 | ||||||||||
| Unamortized note discount | 44,844 | 46,437 | ||||||||||
| Unamortized debt costs | 28,263 | 29,760 | ||||||||||
| Gross Debt | 4,717,700 | 4,450,000 | ||||||||||
| Total Cash | (6,748 | ) | (9,062 | ) | ||||||||
| Net Debt | $ | 4,710,952 | $ | 4,440,938 |
NNN REIT, Inc.
Debt Summary
As of June 30, 2025
(dollars in thousands)
(unaudited)
| Unsecured Debt | Principal | Principal,<br>Net of<br>Unamortized<br>Discount | Stated<br>Rate | Effective<br>Rate | Maturity Date | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Line of credit payable(1) | $ | 267,700 | $ | 267,700 | SOFR + <br>87.5 bps | 5.165 | % | April 2028 | ||||
| Unsecured notes payable: | ||||||||||||
| 2025 | 400,000 | 399,957 | 4.000 | % | 4.029 | % | November 2025 | |||||
| 2026 | 350,000 | 349,345 | 3.600 | % | 3.733 | % | December 2026 | |||||
| 2027 | 400,000 | 399,578 | 3.500 | % | 3.548 | % | October 2027 | |||||
| 2028 | 400,000 | 398,928 | 4.300 | % | 4.388 | % | October 2028 | |||||
| 2030 | 400,000 | 399,349 | 2.500 | % | 2.536 | % | April 2030 | |||||
| 2033 | 500,000 | 490,040 | 5.600 | % | 5.905 | % | October 2033 | |||||
| 2034 | 500,000 | 494,352 | 5.500 | % | 5.662 | % | June 2034 | |||||
| 2048 | 300,000 | 296,261 | 4.800 | % | 4.890 | % | October 2048 | |||||
| 2050 | 300,000 | 294,631 | 3.100 | % | 3.205 | % | April 2050 | |||||
| 2051 | 450,000 | 442,318 | 3.500 | % | 3.602 | % | April 2051 | |||||
| 2052 | 450,000 | 440,397 | 3.000 | % | 3.118 | % | April 2052 | |||||
| Total | 4,450,000 | 4,405,156 | ||||||||||
| Total unsecured debt(1) (2) | $ | 4,717,700 | $ | 4,672,856 | ||||||||
| Debt costs | $ | (43,820 | ) | |||||||||
| Accumulated amortization | 15,557 | |||||||||||
| Debt costs, net of accumulated amortization | (28,263 | ) | ||||||||||
| Notes payable, net of unamortized discount and <br> unamortized debt costs | $ | 4,376,893 | ||||||||||
| (1) | On July 1, 2025, NNN issued the 2031 Notes and used the proceeds from the offering to repay the outstanding balance on the Company's unsecured revolving line of credit. | |||||||||||
| --- | --- | |||||||||||
| (2) | Unsecured debt has a weighted average interest rate of 4.2% and a weighted average maturity of 11.1 years. |
NNN REIT, Inc.
Debt Summary – Continued
As of June 30, 2025
(unaudited)
Credit Metrics
| June 30,<br>2025 | December 31, <br>2024 | |
|---|---|---|
| Gross Debt / Gross Assets | 41.7% | 40.7% |
| Net Debt / EBITDAre (last quarter annualized) | 5.7 | 5.6 |
| EBITDAre / fixed charges | 4.2 | 4.2 |
Credit Facility and Notes Covenants
The following is a summary of key financial covenants for the Company's unsecured credit facility and notes, as defined and calculated per the terms of the facility's credit agreement and the notes' governing documents, respectively, which are included in the Company's filings with the Commission. These calculations, which are not based on U.S. GAAP measurements, are presented to investors to show that as of June 30, 2025, the Company believes it is in compliance with the covenants.
| Key Covenants | Required | June 30,<br>2025 |
|---|---|---|
| Unsecured Bank Credit Facility: | ||
| Maximum leverage ratio | < 0.60 | 0.39 |
| Minimum fixed charge coverage ratio | > 1.50 | 4.26 |
| Maximum secured indebtedness ratio | < 0.40 | — |
| Unencumbered asset value ratio | > 1.67 | 2.65 |
| Unencumbered interest ratio | > 1.75 | 4.17 |
| Unsecured Notes: | ||
| Limitation on incurrence of total debt | ≤ 60% | 41% |
| Limitation on incurrence of secured debt | ≤ 40% | — |
| Debt service coverage ratio | ≥ 1.5 | 4.2 |
| Maintenance of total unencumbered assets | ≥ 150% | 244% |
NNN REIT, Inc.
Property Portfolio
As of June 30, 2025
Top 20 Lines of Trade
| % of ABR | |||
|---|---|---|---|
| As of June 30, | |||
| Lines of Trade | 2025 | 2024 | |
| 1. | Automotive service | 18.2% | 16.9% |
| 2. | Convenience stores | 16.5% | 16.2% |
| 3. | Restaurants – limited service | 8.2% | 8.5% |
| 4. | Entertainment | 7.3% | 6.6% |
| 5. | Restaurants – full service | 7.0% | 8.4% |
| 6. | Dealerships | 6.7% | 5.4% |
| 7. | Health and fitness | 4.1% | 4.0% |
| 8. | Theaters | 3.8% | 4.1% |
| 9. | Equipment rental | 3.1% | 3.3% |
| 10. | Automotive parts | 2.4% | 2.4% |
| 11. | Wholesale clubs | 2.3% | 2.4% |
| 12. | Drug stores | 2.1% | 2.3% |
| 13. | Home improvement | 2.0% | 2.2% |
| 14. | Medical service providers | 1.9% | 1.8% |
| 15. | Pet supplies and services | 1.6% | 1.2% |
| 16. | Discount retail | 1.4% | 1.6% |
| 17. | Furniture | 1.3% | 2.0% |
| 18. | Travel plazas | 1.2% | 1.3% |
| 19. | Consumer electronics | 1.2% | 1.3% |
| 20. | Home furnishings | 1.1% | 1.3% |
| Other | 6.6% | 6.8% | |
| Total | 100.0% | 100.0% |
NNN REIT, Inc.
Property Portfolio – Continued
As of June 30, 2025
Top 20 States
| State | # of <br>Properties | % of <br>ABR | |
|---|---|---|---|
| 1. | Texas | 590 | 18.8% |
| 2. | Florida | 271 | 8.7% |
| 3. | Illinois | 169 | 4.9% |
| 4. | Georgia | 173 | 4.4% |
| 5. | Ohio | 226 | 4.4% |
| 6. | Indiana | 164 | 3.7% |
| 7. | Tennessee | 154 | 3.7% |
| 8. | North Carolina | 158 | 3.6% |
| 9. | Michigan | 121 | 3.4% |
| 10. | Arizona | 81 | 3.4% |
| 11. | Virginia | 120 | 3.4% |
| 12. | California | 72 | 2.9% |
| 13. | Alabama | 150 | 2.8% |
| 14. | Pennsylvania | 89 | 2.5% |
| 15. | New Jersey | 33 | 2.4% |
| 16. | Missouri | 106 | 2.4% |
| 17. | Maryland | 50 | 2.1% |
| 18. | Colorado | 45 | 2.0% |
| 19. | South Carolina | 81 | 1.9% |
| 20. | Oklahoma | 89 | 1.7% |
| Other | 721 | 16.9% | |
| Total | 3,663 | 100.0% |
NNN REIT, Inc.
Property Portfolio – Continued
As of June 30, 2025
Top 20 Tenants
| Tenant | # of <br>Properties | % of <br>ABR | |
|---|---|---|---|
| 1. | 7-Eleven | 146 | 4.4% |
| 2. | Mister Car Wash | 121 | 4.0% |
| 3. | Dave & Buster's | 34 | 3.7% |
| 4. | Camping World | 46 | 3.6% |
| 5. | GPM Investments (convenience stores) | 147 | 2.7% |
| 6. | Flynn Restaurant Group (Taco Bell/Arby's) | 204 | 2.6% |
| 7. | AMC Theatres | 20 | 2.5% |
| 8. | BJ's Wholesale Club | 13 | 2.3% |
| 9. | LA Fitness | 25 | 2.3% |
| 10. | Kent Distributors (convenience stores) | 49 | 2.3% |
| 11. | Mavis Tire Express Services | 140 | 2.1% |
| 12. | Couche Tard (Pantry) | 91 | 2.1% |
| 13. | Walgreens | 49 | 1.7% |
| 14. | Sunoco | 53 | 1.7% |
| 15. | Chuck E. Cheese | 51 | 1.7% |
| 16. | Casey's General Stores (convenience stores) | 62 | 1.6% |
| 17. | United Rentals | 49 | 1.6% |
| 18. | Tidal Wave Auto Spa | 35 | 1.4% |
| 19. | Super Star Car Wash | 33 | 1.3% |
| 20. | Bob Evans Restaurants | 105 | 1.2% |
| Other | 2,190 | 53.2% | |
| Total | 3,663 | 100.0% |
Lease Expirations(1)
| % of<br>ABR | # of<br>Properties | Gross Leasable<br>Area(2) | % of<br>ABR | # of<br>Properties | Gross Leasable<br>Area(2) | ||
|---|---|---|---|---|---|---|---|
| 2025 | 2.2% | 90 | 512,000 | 2031 | 6.8% | 191 | 2,668,000 |
| 2026 | 3.9% | 196 | 1,899,000 | 2032 | 5.1% | 190 | 1,846,000 |
| 2027 | 7.1% | 216 | 3,277,000 | 2033 | 4.5% | 136 | 1,411,000 |
| 2028 | 5.6% | 253 | 2,270,000 | 2034 | 5.5% | 180 | 2,334,000 |
| 2029 | 4.4% | 141 | 2,071,000 | Thereafter | 50.2% | 1,816 | 16,913,000 |
| 2030 | 4.7% | 179 | 2,275,000 | ||||
| (1) | As of June 30, 2025, the weighted average remaining lease term is 9.8 years. | ||||||
| --- | --- | ||||||
| (2) | Square feet. |