Exhibit 99

 

 

 

 

Table of Contents

 

	Page
Consolidated Balance Sheets	3
Consolidated Statements of Income (Loss)	4
FFO, AFFO and Adjusted EBITDA Reconciliations	5
NOI Reconciliations	6
Financial Highlights	7
Same Property Statistics	8
Consolidated Statements of Cash Flows	10
Capital Structure and Leverage Ratios	11
Debt Maturity	13
Property Table by Tenant	14
Property Table by State	15
Lease Expirations	16
Recent Acquisitions	17
Property Table	18
Definitions	21
Press Release Dated August 2, 2021	22

 

The statement of operations and supplemental statement of operations provided in this supplemental information package present funds from operations (FFO), adjusted funds from operations (AFFO), net operating income (NOI) and adjusted EBITDA, which are REIT industry financial measures that are not calculated in accordance with accounting principles generally accepted in the United States. Please see page 21 for a definition of these supplemental performance measures. Please see the supplemental statement of operations reconciliation for a reconciliation of certain captions in the supplemental statement of operations reported in this supplemental information package to the statement of operations as reported in the Company’s filings with the SEC on Form 10-Q.

 

 

Consolidated Balance Sheets

(in thousands except for per share amounts)

 

		As of				As of
		June 30,				September 30,
		2021				2020
		(unaudited)
ASSETS
Real Estate Investments:
Land		$	266,791			$	250,497
Buildings and Improvements			1,942,840				1,793,367
Total Real Estate Investments			2,209,631				2,043,864
Accumulated Depreciation			(332,725	)			(296,020	)
Real Estate Investments			1,876,906				1,747,844
Cash and Cash Equivalents			90,896				23,517
Securities Available for Sale at Fair Value			148,382				108,832
Tenant and Other Receivables			3,201				5,431
Deferred Rent Receivable			15,066				12,856
Prepaid Expenses			9,191				7,554
Intangible Assets, net of Accumulated Amortization of $19,061 and $17,330, respectively			19,939				16,832
Capitalized Lease Costs, net of Accumulated Amortization of $4,614 and $4,286, respectively			5,817				5,631
Financing Costs, net of Accumulated Amortization of $648 and $356, respectively			1,088				1,380
Other Assets			7,592				9,906
TOTAL ASSETS		$	2,178,078			$	1,939,783
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt
Issuance Costs		$	848,994			$	799,507
Loans Payable			165,000				75,000
Accounts Payable and Accrued Expenses			5,532				3,998
Other Liabilities			22,705				23,673
Total Liabilities			1,042,231				902,178
COMMITMENTS AND CONTINGENCIES
Shareholders’ Equity:
6.125% Series C Cumulative Redeemable Preferred Stock, $0.01 Par Value Per Share: 26,600 and 21,900 Shares Authorized as of June 30, 2021 and September 30, 2020, respectively; 21,986 and 18,880 Shares Issued and Outstanding as of June 30, 2021 and September 30, 2020, respectively			549,640				471,994
Common Stock, $0.01 Par Value Per Share: 300,000 and 200,000 Shares Authorized as of June 30, 2021 and September 30, 2020, respectively; 98,302 and 98,054 Shares Issued and Outstanding as of June 30, 2021 and September 30, 2020, respectively			983				981
Excess Stock, $0.01 Par Value Per Share: 200,000 Shares Authorized as of June 30, 2021 and September 30, 2020; No Shares Issued or Outstanding as of June 30, 2021 and September 30, 2020			-0-				-0-
Additional Paid-In Capital			587,730				568,998
Accumulated Other Comprehensive Loss			(2,506	)			(4,368	)
Undistributed Income			-0-				-0-
Total Shareholders’ Equity			1,135,847				1,037,605
TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY		$	2,178,078			$	1,939,783

 

 

Consolidated Statements of Income (Loss)

(unaudited) (in thousands)

 

		For The								For The
		Three Months Ended								Nine Months Ended
		6/30/2021				6/30/2020				6/30/2021				6/30/2020
INCOME:
Rental Revenue		$	39,032			$	35,427			$	115,123			$	105,410
Reimbursement Revenue			6,962				6,348				20,818				19,772
Lease Termination Income			-0-				-0-				377				-0-
TOTAL INCOME			45,994				41,775				136,318				125,182
EXPENSES:
Real Estate Taxes			5,402				5,140				16,324				15,205
Operating Expenses			1,688				1,590				5,361				5,344
General & Administrative Expenses			2,246				2,198				6,363				6,858
Non-recurring Strategic Alternatives & Proxy Costs			8,657				-0-				10,896				-0-
Non-recurring Severance Expense			-0-				-0-				-0-				786
Depreciation			13,016				11,743				38,158				34,650
Amortization of Capitalized Lease Costs and Intangible Assets			1,031				788				2,718				2,308
TOTAL EXPENSES			32,040				21,459				79,820				65,151
OTHER INCOME (EXPENSE):
Dividend Income			1,486				2,344				4,681				8,987
Realized Gain On Sale of Real Estate Investment			6,376				-0-				6,376				-0-
Realized Gain On Sale of Securities Transactions			-0-				-0-				2,248				-0-
Unrealized Holding Gains (Losses) Arising During the Periods			16,471				19,610				55,377				(67,100	)
Interest Expense, including Amortization of Financing Costs			(9,685	)			(8,975	)			(28,231	)			(27,235	)
TOTAL OTHER INCOME (EXPENSE)			14,648				12,979				40,451				(85,348	)
NET INCOME (LOSS)			28,602				33,295				96,949				(25,317	)
Less: Net Income (Loss) Attributable to Non-Controlling Interest			2,894				(163	)			2,996				(86	)
NET INCOME (LOSS) ATTRIBUTABLE TO SHAREHOLDERS			25,708				33,458				93,953				(25,231	)
Less: Preferred Dividends			8,416				6,607				25,003				19,469
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS		$	17,292			$	26,851			$	68,950			$	(44,700	)

 

 

FFO, AFFO and Adjusted EBITDA Reconciliations

(unaudited) (in thousands)

 

		For The								For The
		Three Months Ended								Nine Months Ended
		6/30/2021				6/30/2020				6/30/2021				6/30/2020
FFO, AFFO
Net Income (Loss) Attributable to Common Shareholders		$	17,292			$	26,851			$	68,950			$	(44,700	)
Less/Plus: Unrealized Holding (Gains) Losses Arising During the Periods			(16,471	)			(19,610	)			(55,377	)			67,100
Plus: Depreciation Expense (excluding Corporate Office Capitalized Costs)			12,960				11,672				37,959				34,436
Plus: Amortization of Intangible Assets			599				524				1,731				1,539
Plus: Amortization of Capitalized Lease Costs			374				284				971				830
Less: Realized Gain on Sale of Real Estate Investment (A)			(3,252	)			-0-				(3,252	)			-0-
FFO Attributable to Common Shareholders (B)			11,502				19,721				50,982				59,205
Plus: Depreciation of Corporate Office Capitalized Costs			57				57				172				176
Plus: Stock Compensation Expense			77				98				210				368
Plus: Amortization of Financing Costs			350				326				1,026				1,082
Plus: Non-recurring Strategic Alternatives & Proxy Costs			8,657				-0-				10,896				-0-
Plus: Non-recurring Severance Expense			-0-				-0-				-0-				786
Less: Realized Gain on Sale of Securities Transactions			-0-				-0-				(2,248	)			-0-
Less: Lease Termination Income			-0-				-0-				(377	)			-0-
Less: Recurring Capital Expenditures			(229	)			(508	)			(791	)			(1,443	)
Less: Effect of Non-cash U.S. GAAP Straight-line Rent Adjustment			(713	)			(231	)			(2,363	)			(1,469	)
AFFO Attributable to Common Shareholders		$	19,701			$	19,463			$	57,507			$	58,705

 

		For The								For The
		Three Months Ended								Nine Months Ended
		6/30/2021				6/30/2020				6/30/2021				6/30/2020
Adjusted EBITDA
Net Income (Loss) Attributable to Common Shareholders		$	17,292			$	26,851			$	68,950			$	(44,700	)
Plus: Preferred Dividends			8,416				6,607				25,003				19,469
Plus: Interest Expense, including Amortization of Financing Costs			9,685				8,975				28,231				27,235
Plus: Depreciation and Amortization			14,047				12,531				40,876				36,958
Plus: Net Amortization of Acquired Above and Below Market Lease Revenue			26				26				77				77
Plus: Non-recurring Strategic Alternatives & Proxy Costs			8,657				-0-				10,896				-0-
Less/Plus: Unrealized Holding (Gains) Losses Arising During the Periods			(16,471	)			(19,610	)			(55,377	)			67,100
Less: Realized Gain on Sale of Real Estate Investment (A)			(3,252	)			-0-				(3,252	)			-0-
Less: Gain on Sale of Securities Transactions			-0-				-0-				(2,248	)			-0-
Adjusted EBITDA		$	38,400			$	35,380			$	113,156			$	106,139

 

(A)

Represents our portion of the net realized gain from the sale of our property that we owned a 51% interest in.

(B)

FFO Attributable to Common Shareholders for the three and nine months ended June 30, 2021 includes Non-recurring Strategic Alternatives & Proxy Costs of $8.7 million and $10.9 million, respectively. FFO Attributable to Common Shareholders for the three and nine months ended June 30, 2021 excluding these Non-recurring Strategic Alternatives & Proxy Costs is $20.2 million and $61.9 million, respectively.

 

 

NOI Reconciliations

(unaudited) (in thousands)

 

		For The								For The
		Three Months Ended								Nine Months Ended
		6/30/2021				6/30/2020				6/30/2021				6/30/2020
Net Operating Income
Net Income (Loss) Attributable to Common Shareholders		$	17,292			$	26,851			$	68,950			$	(44,700	)
Plus: Net Income (Loss) Attributable to Non-Controlling Interest			2,894				(163	)			2,996				(86	)
Plus: Preferred Dividend Expense			8,416				6,607				25,003				19,469
Plus: General & Administrative Expenses			2,246				2,198				6,363				6,858
Plus: Non-recurring Strategic Alternative & Proxy Costs			8,657				-0-				10,896				-0-
Plus: Non-recurring Severance Expense			-0-				-0-				-0-				786
Plus: Depreciation			13,016				11,743				38,158				34,650
Plus: Amortization of Capitalized Lease Costs and Intangible Assets			1,031				788				2,718				2,308
Plus: Interest Expense, including Amortization of Financing Costs			9,685				8,975				28,231				27,235
Less/Plus: Unrealized Holding (Gains) Losses Arising During the Periods			(16,471	)			(19,610	)			(55,377	)			67,100
Less: Dividend Income			(1,486	)			(2,344	)			(4,681	)			(8,987	)
Less: Realized Gain on Sale of Securities Transactions			-0-				-0-				(2,248	)			-0-
Less: Realized Gain on Sale of Real Estate Investment			(6,376	)			-0-				(6,376	)			-0-
Less: Lease Termination Income			-0-				-0-				(377	)			-0-
Net Operating Income – NOI		$	38,904			$	35,045			$	114,256			$	104,633

 

		For The								For The
		Three Months Ended								Nine Months Ended
		6/30/2021				6/30/2020				6/30/2021				6/30/2020
Components of Net Operating Income Consists of:
Revenues:
Rental Revenue		$	39,032				35,427			$	115,123			$	105,410
Reimbursement Revenue			6,962				6,348				20,818				19,772
Total Rental and Reimbursement Revenue			45,994				41,775				135,941				125,182
Expenses:
Real Estate Taxes			5,402				5,140				16,324				15,205
Operating Expenses			1,688				1,590				5,361				5,344
Total Real Estate Taxes and Operating Expenses			7,090				6,730				21,685				20,549
Net Operating Income – NOI		$	38,904			$	35,045			$	114,256			$	104,633

 

 
Financial Highlights

(unaudited) (in thousands except for per share amounts)

 

		For The												For The
		Three Months Ended												Nine Months Ended
		6/30/2021				6/30/2020				Change (%)				6/30/2021				6/30/2020				Change (%)
Weighted Average Common Shares Outstanding
Basic			98,302				97,906				0.4	%			98,234				97,548				0.7	%
Diluted			98,539				97,962				0.6	%			98,415				97,626				0.8	%
Net Income (Loss) Attributable to Common Shareholders		$	17,292			$	26,851				(35.6	)%		$	68,950			$	(44,700	)			254.3	%
Basic		$	0.17			$	0.27				(37.0	)%		$	0.71			$	(0.46	)			254.3	%
Diluted			0.17				0.27				(37.0	)%			0.71				(0.46	)			254.3	%
Net Operating Income – NOI		$	38,904			$	35,045				11.0	%		$	114,256			$	104,633				9.2	%
Basic		$	0.40			$	0.36				11.1	%		$	1.16			$	1.07				8.4	%
Diluted			0.39				0.36				8.3	%			1.16				1.07				8.4	%
Funds From Operations – FFO		$	11,502			$	19,721				(41.7	)%		$	50,982			$	59,205				(13.9	)%
Basic		$	0.12			$	0.20				(40.0	)%		$	0.52			$	0.61				(14.8	)%
Diluted			0.12				0.20				(40.0	)%			0.52				0.61				(14.8	)%
FFO Excluding Non-recurring Strategic Alternatives & Proxy Costs		$	20,159			$	19,721				2.2	%		$	61,878			$	59,205				4.5	%
Basic		$	0.21			$	0.20				0.5	%		$	0.63			$	0.61				3.2	%
Diluted			0.20				0.20				0.0	%			0.63				0.61				3.2	%
Adjusted Funds From Operations – AFFO		$	19,701			$	19,463				1.2	%		$	57,507			$	58,705				(2.0	)%
Basic		$	0.20			$	0.20				0.0	%		$	0.59			$	0.60				(1.7	)%
Diluted			0.20				0.20				0.0	%			0.58				0.60				(3.3	)%
Dividends Declared per Common Share		$	0.18			$	0.17							$	0.53			$	0.51
Dividend/FFO Excluding Non-recurring Strategic Alternatives & Proxy Costs			90.0	%			85.0	%							84.1	%			83.6	%
Dividend/AFFO Payout Ratio			90.0	%			85.0	%							91.4	%			85.0	%

 

 

Same Property Statistics

(unaudited) (in thousands except for square feet)

 

		For The Three Months Ended
		6/30/2021								6/30/2020				Change				Change %
Total Square Feet / Total Properties			24,521,727 / 120								23,375,642 / 118				1,146,085				4.9	%
Occupancy Percentage at End of Period			99.7	%							99.4	%			30 bps				0.3	%
Same Property Square Feet / Number of Same Properties							22,498,383 / 113
Same Property Occupancy Percentage at End of Period			99.6	%							99.4	%			20 bps				0.2	%
Same Property Net Operating Income (NOI) (GAAP)		$	34,550							$	34,207			$	343				1.0	%
Reversal of Effect of Non-cash U.S. GAAP Straight-line Rent Adjustment			(556	)							(586	)			30
Same Property Cash NOI		$	33,994							$	33,621			$	373				1.1	%

 

Same Property Statistics include all properties owned during the entire periods presented with the exclusion of properties expanded during the periods presented.

 

Reconciliation of Same Property NOI to Total NOI

(unaudited) (in thousands)

 

		For The Three Months Ended
		6/30/2021				6/30/2020				Change				Change %
Same Property NOI (GAAP)		$	34,550			$	34,207			$	343				1.0	%
NOI of properties purchased subsequent to March 31, 2020 (two properties purchased during fiscal 2021 and three properties purchased during fiscal 2020)			3,680				426
NOI of property expanded subsequent to  March 31, 2020 (two properties expanded during fiscal 2021)			804				688
NOI of property sold subsequent to March 31, 2020 (one property sold during fiscal 2021)			(130	)			(276	)
Total NOI		$	38,904			$	35,045			$	3,859				11.0	%

 

 

Same Property Statistics

(unaudited) (in thousands except for square feet)

 

		For The Nine Months Ended
		6/30/2021								6/30/2020				Change				Change %
Total Square Feet / Total Properties			24,521,727 / 120								23,375,642 / 118				1,146,085				4.9	%
Occupancy Percentage at End of Period			99.7	%							99.4	%			30 bps				0.3	%
Same Property Square Feet / Number of Same Properties							21,729,641 / 111
Same Property Occupancy Percentage at End of Period			99.6	%							99.4	%			20 bps				0.2	%
Same Property Net Operating Income (NOI) (GAAP)		$	98,280							$	98,179			$	101				0.1	%
Reversal of Effect of Non-cash U.S. GAAP Straight-line Rent Adjustment			(1,195	)							(1,499	)			304
Same Property Cash NOI		$	97,085							$	96,680			$	405				0.4	%

 

Same Property Statistics include all properties owned during the entire periods presented with the exclusion of properties expanded during the periods presented.

 

Reconciliation of Same Property NOI to Total NOI

(unaudited) (in thousands)

 

		For The Nine Months Ended
		6/30/2021				6/30/2020				Change				Change %
Same Property NOI (GAAP)		$	98,280			$	98,179			$	101				0.1	%
NOI of properties purchased subsequent to September 30, 2019 (two properties purchased during fiscal 2021 and five properties purchased during fiscal 2020)			13,551				4,393
NOI of properties expanded subsequent to September 30, 2019 (two properties expanded during fiscal 2021)			2,238				2,066
NOI of property sold subsequent to September 30, 2019 (one property sold during fiscal 2021)			187				(5	)
Total NOI		$	114,256			$	104,633			$	9,623				9.2	%

 

 

Consolidated Statements of Cash Flows

(unaudited)(in thousands)

 

		For The
		Nine Months Ended
		6/30/2021				6/30/2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss)		$	96,949			$	(25,317	)
Noncash Items Included in Net Income (Loss):
Depreciation & Amortization			41,919				38,043
Deferred Straight Line Rent			(2,378	)			(1,459	)
Stock Compensation Expense			210				368
Securities Available for Sale Received as Dividend Income			(752	)			(977	)
Realized Gain on Sale of Real Estate Investment			(6,376	)			-0-
Realized Gain on Sale of Securities Transactions			(2,248	)			-0-
Unrealized Holding (Gains) Losses Arising During the Periods			(55,377	)			67,100
Changes in:
Tenant & Other Receivables			2,307				(1,153	)
Prepaid Expenses			(1,637	)			(2,242	)
Other Assets & Capitalized Lease Costs			803				(1,999	)
Accounts Payable, Accrued Expenses & Other Liabilities			3,348				2,600
NET CASH PROVIDED BY OPERATING ACTIVITIES			76,768				74,964
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of Real Estate & Intangible Assets			(171,082	)			(160,023	)
Capital Improvements			(5,384	)			(4,726	)
Net Proceeds from Sale of Real Estate Investments			12,303				-0-
Return of Deposits on Real Estate			5,060				2,000
Deposits Paid on Acquisitions of Real Estate			(4,970	)			(550	)
Proceeds from the Sale of Securities Available for Sale			16,327				-0-
Proceeds from Securities Available for Sale Called for Redemption			2,500				250
NET CASH USED IN INVESTING ACTIVITIES			(145,246	)			(163,049	)
CASH FLOWS FROM FINANCING ACTIVITIES
Net Draws (Repayments) on Loans Payable			90,000				(15,000	)
Proceeds from Fixed Rate Mortgage Notes Payable			104,000				100,560
Principal Payments on Fixed Rate Mortgage Notes Payable			(54,696	)			(41,166	)
Financing Costs Paid on Debt			(569	)			(2,397	)
Proceeds from the Exercise of Stock Options			1,966				1,016
Net Distributions to Non-controlling Interest			(5,491	)			(32	)
Proceeds from At-The-Market 6.125% Series C Preferred Stock, net of offering costs			75,958				84,815
Proceeds from Issuance of Common Stock in the DRIP, net of Dividend Reinvestments			320				18,641
Shares repurchased through the Common Stock Repurchase Plan			-0-				(4,276	)
Preferred Dividends Paid			(24,607	)			(19,029	)
Common Dividends Paid, net of Reinvestments			(51,024	)			(43,122	)
NET CASH PROVIDED BY FINANCING ACTIVITIES			135,857				80,010
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS			67,379				(8,075	)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD			23,517				20,179
CASH AND CASH EQUIVALENTS - END OF PERIOD		$	90,896			$	12,104

 

 

Capital Structure and Leverage Ratios

(unaudited) (in thousands except for per share amounts)

 

		As of				As of				As of
		6/30/2021				6/30/2020				9/30/2020
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs		$	848,994			$	804,342			$	799,507
Loans Payable			165,000				80,000				75,000
Total Debt			1,013,994				884,342				874,507
6.125% Series C Cumulative Redeemable Preferred Stock			549,640				433,850				471,994
Common Stock, Additional Paid-In-Capital & Other			586,207				589,935				565,611
Total Shareholders’ Equity			1,135,847				1,023,785				1,037,605
Total Book Capitalization			2,149,841				1,908,127				1,912,112
Accumulated Depreciation			332,725				284,058				296,020
Total Undepreciated Book Capitalization		$	2,482,566			$	2,192,185			$	2,208,132
Shares Outstanding			98,302				97,972				98,054
Market Price Per Share		$	18.72			$	14.49			$	13.85
Equity Market Capitalization		$	1,840,217			$	1,419,609			$	1,358,049
Total Debt			1,013,994				884,342				874,507
Total Preferred Stock			549,640				433,850				471,994
Total Market Capitalization		$	3,403,851			$	2,737,801			$	2,704,550
Total Debt		$	1,013,994			$	884,342			$	874,507
less: Cash and Cash Equivalents			90,896				12,104				23,517
Net Debt		$	923,098			$	872,238			$	850,990
less: Securities Available for Sale at Fair Value (Securities)			148,382				118,877				108,832
Net Debt Less Securities		$	774,716			$	753,361			$	742,158
Net Debt / Total Undepreciated Book Capitalization			37.2	%			39.8	%			38.5	%
Net Debt / Total Market Capitalization			27.1	%			31.9	%			31.5	%
Net Debt Plus Preferred Stock / Total Market Capitalization			43.3	%			47.7	%			48.9	%
Net Debt Less Securities / Total Undepreciated Book Capitalization			31.2	%			34.4	%			33.6	%
Net Debt Less Securities / Total Market Capitalization			22.8	%			27.5	%			27.4	%
Net Debt Less Securities Plus Preferred Stock / Total Market Capitalization			38.9	%			43.4	%			44.9	%
Weighted Average Interest Rate on Fixed Rate Mortgage Debt			3.86	%			4.00	%			3.98	%
Weighted Average Term on Fixed Rate Mortgage Debt			11.1 yrs.				11.2 yrs.				11.1 yrs.
Weighted Average Lease Term			7.2 yrs.				7.2 yrs.				7.1 yrs.

 

 

Capital Structure and Leverage Ratios

(unaudited) (in thousands)

 

		For the Three Months Ended								For the Nine Months Ended								Fiscal Year Ended
		6/30/2021				6/30/2020				6/30/2021				6/30/2020				9/30/2020
Net Income (Loss) Attributable to Common Shareholders		$	17,292			$	26,851			$	68,950			$	(44,700	)		$	(48,617	)
Plus: Preferred Dividends			8,416				6,607				25,003				19,469				26,474
Plus: Interest Expense, including Amortization of Financing Costs			9,685				8,975				28,231				27,235				36,376
Plus: Depreciation and Amortization			14,047				12,531				40,876				36,958				49,850
Plus: Net Amortization of Acquired Above and Below Market Lease Revenue			26				26				77				77				103
Plus: Non-recurring Strategic Alternative & Proxy Costs			8,657				-0-				10,896				-0-				-0-
Less/Plus: Unrealized Holding (Gains) Losses Arising During the Periods			(16,471	)			(19,610	)			(55,377	)			67,100				77,380
Less: Realized Gain on Sale of Real Estate Investment (A)			(3,252	)			-0-				(3,252	)			-0-				-0-
Less: Realized Gain on Sale of Securities Transactions			-0-				-0-				(2,248	)			-0-				-0-
Adjusted EBITDA		$	38,400			$	35,380			$	113,156			$	106,139			$	141,566
Interest Expense, including Amortization of Financing Costs		$	9,685			$	8,975			$	28,231			$	27,235			$	36,376
Preferred Dividends			8,416				6,607				25,003				19,469				26,474
Total Fixed Charges		$	18,101			$	15,582			$	53,234			$	46,704			$	62,850
Interest Coverage			4.0 x				3.9 x				4.0 x				3.9 x				3.9 x
Fixed Charge Coverage			2.1 x				2.3 x				2.1 x				2.3 x				2.3 x
Net Debt		$	923,098			$	872,238			$	923,098			$	872,238			$	850,990
Net Debt Less Securities			774,716				753,361				774,716				753,361				742,158
Total Preferred Stock			549,640				433,850				549,640				433,850				471,994
Annualized Adjusted EBITDA			153,600				141,520				150,875				141,519				141,566
Net Debt / Adjusted EBITDA			6.0 x				6.2 x				6.1 x				6.2 x				6.0 x
Net Debt Less Securities / Adjusted EBITDA			5.0 x				5.3 x				5.1 x				5.3 x				5.2 x
Net Debt + Preferred Stock / Adjusted EBITDA			9.6 x				9.2 x				9.8 x				9.2 x				9.3 x
Net Debt Less Securities + Preferred Stock / Adjusted EBITDA			8.6 x				8.4 x				8.8 x				8.4 x				8.6 x

 

(A)

Represents our portion of the net realized gain from the sale of our property that we owned a 51% interest in.

 

 

Debt Maturity

(unaudited) (In thousands)

 

 

 

						Loans								% of
Fiscal Year Ended		Mortgages				Payable				Total				Total
2021		$	16,530				-0-				16,530				1.6	%
2022			82,060				-0-				82,060				8.0	%
2023			67,234				-0-				67,234				6.6	%
2024			80,674				90,000	(B)			170,674				16.7	%
2025			75,069				75,000	(C)			150,069				14.7	%
Thereafter			535,108				-0-				535,108				52.4	%
Total as of 6/30/2021		$	856,675	(A)		$	165,000			$	1,021,675				100.0	%
Weighted Average Interest Rate			3.86	%			2.16	%			3.59	%
Weighted Average Term			11.1 yrs.				3.0 yrs.				10.3 yrs.

 

	(A)	Mortgages does not include unamortized debt issuance costs of $7.7 million.
	(B)	Represents a Line of Credit maturing January 2024.
	(C)	Represents a Term Loan maturing January 2025.

 

 

Property Table by Tenant

(unaudited)

 

			Property				Square				Occupied Square				% of Occupied				Annual				% of Total				Rent Per				Undepreciated				Mortgage
Tenant			Count				Footage				Footage				sf				Rent				Ann. Rent				sf Occup.				Cost				Balance
FedEx Ground Package System, Inc.				47				10,072,613				10,072,613				41.0	%		$	80,425,000				50.6	%		$	7.98			$	1,147,240,676				$	472,570,290
FedEx Corporation				16				1,164,813				1,164,813				4.8	%			7,543,000				4.7	%			6.48				109,308,345					19,559,469
Total FedEx				63				11,237,426				11,237,426				45.8	%			87,968,000				55.3	%			7.83				1,256,549,021					492,129,759
Subsidiaries of Amazon.com, Inc.				5				1,491,245				1,491,245				6.1	%			10,742,000				6.8	%			7.20				166,563,789					91,341,377
Milwaukee Electric Tool Corporation				1				861,889				861,889				3.5	%			3,098,000				2.0	%			3.59				36,914,917					16,588,500
Shaw Industries, Inc.				1				831,764				831,764				3.4	%			3,563,000				2.2	%			4.28				56,025,945					26,792,654
Home Depot U.S.A., Inc.				2				828,748				828,748				3.4	%			6,537,000				4.1	%			7.89				104,539,007					55,945,982
ULTA, Inc.				1				671,354				671,354				2.7	%			2,782,000				1.8	%			4.14				37,773,835					16,233,638
Jim Beam Brands Company (Beam Suntory)				1				599,840				599,840				2.4	%			2,112,000				1.3	%			3.52				28,000,000					13,769,810
International Paper Company				2				578,491				578,491				2.4	%			2,663,000				1.7	%			4.60				37,024,608					16,770,698
TreeHouse Private Brands, Inc.				1				558,509				558,509				2.3	%			2,267,000				1.4	%			4.06				26,807,852					13,196,520
B. Braun Medical Inc.				1				399,440				399,440				1.6	%			2,330,000				1.5	%			5.83				30,871,732					16,436,710
UGN, Inc.				1				387,000				387,000				1.6	%			2,107,000				1.3	%			5.44				21,576,756					11,734,063
CBOCS Distribution, Inc. (Cracker Barrel)				1				381,240				381,240				1.6	%			1,490,000				0.9	%			3.91				14,215,126					-0-
Best Buy Warehousing Logistics, Inc.				1				368,060				368,060				1.5	%			1,725,000				1.1	%			4.69				19,600,000					7,508,796
Toyota Tsusho America, Inc.				1				350,418				350,418				1.4	%			1,722,000				1.1	%			4.91				25,078,587					15,454,363
Coca-Cola				2				328,045				328,045				1.3	%			1,701,000				1.1	%			5.19				20,504,069					1,333,843
Autoneum North America, Inc.				1				315,560				315,560				1.3	%			1,746,000				1.1	%			5.53				21,040,396					12,221,167
Science Applications International Corporation				1				302,400				302,400				1.2	%			1,708,000				1.1	%			5.65				14,463,148					-0-
Bunzl USA Holdings, Inc.				2				268,778				268,778				1.1	%			1,457,000				0.9	%			5.42				18,731,674					4,356,890
Woodstream Corporation	(A)			1				256,000				256,000				1.0	%			987,000				0.6	%			3.86				9,029,539					-0-
Anda Pharmaceuticals, Inc.				1				234,660				234,660				1.0	%			1,220,000				0.8	%			5.20				14,550,000					5,736,033
Mickey Thompson Performance Tires and Wheels (Goodyear Tire & Rubber Co.)				1				219,765				219,765				0.9	%			1,537,000				1.0	%			6.99				18,934,065					10,284,946
Rinnai America Corporation				1				218,120				218,120				0.9	%			913,000				0.6	%			4.19				15,082,217					-0-
Anheuser-Busch, Inc.				1				184,800				184,800				0.8	%			854,000				0.5	%			4.62				12,757,540					-0-
Carrier Enterprise, LLC (Carrier Global Corporation)				1				184,317				184,317				0.8	%			1,160,000				0.7	%			6.29				18,494,917					4,025,447
Carlstar Group, LLC				1				179,280				179,280				0.7	%			771,000				0.5	%			4.30				7,282,986					-0-
NF&M International, Inc.	(B)			1				174,802				174,802				0.7	%			795,000				0.5	%			4.55				5,445,065					-0-
Magna Seating of America, Inc.				1				152,995				152,995				0.6	%			1,201,000				0.8	%			7.85				17,557,830					8,511,498
Victory Packaging, L.P.				1				148,000				148,000				0.6	%			504,000				0.3	%			3.41				5,458,279					-0-
Challenger Lifts, Inc. (Snap-On Inc.)				1				137,500				137,500				0.6	%			858,000				0.5	%			6.24				11,304,000					5,377,343
Altec Industries, Inc.	(A)			1				126,880				126,880				0.5	%			378,000				0.2	%			2.98				4,475,266					-0-
General Electric Company				1				125,860				125,860				0.5	%			1,329,000				0.8	%			10.56				19,972,983					8,949,697
Keurig Dr Pepper				2				110,080				110,080				0.4	%			757,000				0.5	%			6.88				10,498,031					1,303,703
Style Crest, Inc.				1				106,507				106,507				0.4	%			433,000				0.3	%			4.07				7,421,032					-0-
Sonwil Distribution Center, Inc.				1				104,981				104,981				0.4	%			630,000				0.4	%			6.00				10,960,823					-0-
Pittsburgh Glass Works, LLC, a Division of VITRO				1				102,135				102,135				0.4	%			508,000				0.3	%			4.97				4,249,615					-0-
Dakota Bodies, LLC				1				96,687				96,687				0.4	%			416,000				0.3	%			4.30				7,797,827					-0-
National Oilwell Varco, Inc.				1				91,295				91,295				0.4	%			801,000				0.5	%			8.77				8,190,901					671,412
Joseph T. Ryerson and Son, Inc.				1				89,123				89,123				0.4	%			519,000				0.3	%			5.82				7,184,598					-0-
CHEP USA, Inc.				1				83,000				83,000				0.3	%			509,000				0.3	%			6.13				7,463,672					-0-
Sherwin-Williams Company				2				78,887				78,887				0.3	%			648,000				0.4	%			8.21				7,427,594					-0-
United Parcel Service, Inc.				1				75,000				75,000				0.3	%			595,000				0.4	%			7.93				6,741,021					-0-
Tampa Bay Grand Prix				1				68,385				68,385				0.3	%			369,000				0.2	%			5.40				5,677,982					-0-
Various Tenants at Retail Shopping Center				1				64,220				61,190				0.3	%			616,000				0.4	%			10.07				3,139,564					-0-
Locke Supply Co.				1				60,000				60,000				0.2	%			340,000				0.2	%			5.67				5,097,101					-0-
Hartford Healthcare Corporation				1				54,812				54,812				0.2	%			307,000				0.2	%			5.60				3,525,917					-0-
Siemens Real Estate				1				51,130				51,130				0.2	%			464,000				0.3	%			9.07				4,554,684					-0-
Collins Aerospace (Raytheon Technologies Corporation)				1				38,833				38,833				0.2	%			368,000				0.2	%			9.48				5,100,000					-0-
Foundation Building Materials, LLC				1				36,270				36,270				0.2	%			179,000				0.2	%			4.94				2,543,770					-0-
Graybar Electric Company				1				26,340				26,340				0.2	%			122,000				0.1	%			4.63				2,901,362					-0-
Vacant	(B)			1				80,856				-0-				0.0	%			-0-				0.0	%			-0-				2,518,657					-0-
Total as of 6/30/21				120				24,521,727				24,437,841				99.7	%		$	158,806,000				100.0	%		$	6.50			$	2,209,619,300		(C)		$	856,674,849
Acquisitions Subsequent to 6/30/21
FedEx Ground Package System, Inc.				1				143,794				143,794				0.6	%			3,233,000				1.9	%			22.48
Pro Forma Total with Acquisitions Subsequent to 6/30/21				121				24,665,521				24,581,635				99.7	%		$	162,039,000				100.0	%		$	6.59

 

	(A)	Woodstream Corporation and Altec Industries, Inc. are located at one property and, therefore, are counted as one property in the Property Count Total.
	(B)	NF&M International is located in a 255,658 square foot industrial park in Monaca (Pittsburgh), PA, of which 80,856 square feet are vacant. This industrial park is counted as one property in the Property Count Total.
		Other than two properties indicated in footnotes (A) and (B) and one retail property, all properties are single-tenant.
	(C)	Does not include unamortized debt issuance costs of $7,681,337.

 

 

Property Table by State

(unaudited)

 

		Property				Square				Occupied Square				% of Total				Annual				% of Total				Rent Per				Undepreciated				Mortgage
State		Count				Footage				Footage				sf				Rent				Ann. Rent				sf Occup.				Cost				Balance
Ohio			11				2,358,769				2,358,769				9.6	%		$	15,863,000				10.0	%		$	6.73			$	209,060,892			$	93,753,230
Georgia			7				2,297,214				2,297,214				9.4	%			16,134,000				10.2	%			7.02				259,469,156				132,329,894
Florida			13				2,223,042				2,223,042				9.1	%			16,002,000				10.1	%			7.20				228,907,551				79,618,189
Indiana			4				1,965,341				1,965,341				8.0	%			11,212,000				7.1	%			5.70				167,720,415				88,647,033
Texas			10				1,790,337				1,790,337				7.3	%			13,844,000				8.7	%			7.73				183,394,825				61,359,821
Kentucky			3				1,295,849				1,295,849				5.3	%			5,237,000				3.3	%			4.04				66,111,852				32,343,673
South Carolina			6				1,273,676				1,273,676				5.2	%			9,882,000				6.2	%			7.76				129,988,641				49,445,388
North Carolina			5				1,225,987				1,225,987				5.0	%			8,713,000				5.5	%			7.11				132,687,021				64,164,667
Mississippi			4				1,158,889				1,158,889				4.7	%			4,560,000				2.9	%			3.93				56,266,970				22,324,533
Illinois			9				958,102				958,102				3.9	%			6,254,000				3.9	%			6.53				83,672,112				6,827,092
Tennessee			3				891,777				891,777				3.6	%			3,203,000				2.0	%			3.59				35,677,250				2,603,021
Michigan			4				833,717				833,717				3.4	%			5,629,000				3.5	%			6.75				73,561,442				20,775,968
Kansas			4				813,062				813,062				3.3	%			4,998,000				3.1	%			6.15				63,645,556				23,557,610
Missouri			4				740,119				740,119				3.0	%			3,003,000				1.9	%			4.06				35,555,482				-0-
Oklahoma			5				735,721				735,721				3.0	%			4,943,000				3.1	%			6.72				69,942,758				33,698,320
New York			3				518,565				518,565				2.1	%			3,554,000				2.2	%			6.85				52,841,861				17,756,206
Pennsylvania			3				504,040				423,184				2.1	%			2,775,000				1.7	%			6.56				36,959,671				11,047,899
Alabama			2				451,832				451,832				1.8	%			2,670,000				1.7	%			5.91				39,714,135				15,893,528
New Jersey			2				411,365				408,335				1.7	%			5,944,000				3.7	%			14.56				87,127,186				47,779,049
Virginia			5				407,443				407,443				1.7	%			2,474,000				1.6	%			6.07				35,059,207				3,000,099
Colorado			2				295,227				295,227				1.2	%			2,441,000				1.5	%			8.27				35,694,134				13,748,383
Arizona			1				288,045				288,045				1.2	%			1,409,000				0.9	%			4.89				16,824,226				1,333,843
Wisconsin			2				238,666				238,666				1.0	%			1,295,000				0.8	%			5.43				16,377,221				1,702,945
Washington			1				210,445				210,445				0.9	%			1,962,000				1.2	%			9.32				30,369,301				14,569,993
Louisiana			1				175,315				175,315				0.7	%			1,274,000				0.8	%			7.27				18,425,875				9,111,843
Maryland			1				148,881				148,881				0.6	%			1,455,000				0.9	%			9.77				14,632,389				-0-
Nebraska			1				89,115				89,115				0.4	%			446,000				0.3	%			5.00				5,963,626				-0-
Utah			1				69,734				69,734				0.3	%			772,000				0.5	%			11.07				12,666,994				7,917,933
Minnesota			1				60,370				60,370				0.2	%			372,000				0.4	%			6.16				5,231,864				1,364,689
Connecticut			1				54,812				54,812				0.2	%			307,000				0.2	%			5.60				3,525,917				-0-
Iowa			1				36,270				36,270				0.1	%			179,000				0.1	%			4.94				2,543,770				-0-
Total as of 6/30/21			120				24,521,727				24,437,841				100.0	%		$	158,806,000				100.0	%		$	6.50			$	2,209,619,300		(A)		$856,674,849
Acquisitions Subsequent to 6/30/21
Vermont			1				143,794				143,794				0.6	%			3,233,000				1.9	%			22.48
Pro Forma Total with Acquisitions Subsequent to 6/30/21			121				24,665,521				24,581,635				100.0	%		$	162,039,000				100.0	%		$	6.59

 

(A)

Does not include unamortized debt issuance costs of $7,681,337.

 

 

Lease Expirations

(unaudited)

 

				Property				Square				% of Total				Annual				% of Total				Rent Per sf				Lease Exp. Term in				Undepreciated				Mortgage
Fiscal Year				Count				Footage				Sf				Rent				Ann. Rent				Occup.				Years				Cost				Balance
2022					5				1,065,169				4.3	%		$	5,623,000				3.5	%		$	5.28				0.7			$	71,756,260			$	17,691,620
2023(A)					16				2,117,731				8.6	%			12,076,000				7.6	%			5.70				1.9				149,258,939				15,178,067
2024					13				1,887,039				7.7	%			11,797,000				7.4	%			6.25				2.9				137,674,811				20,296,714
2025(A)					11				2,607,541				10.6	%			12,980,000				8.2	%			4.98				3.9				170,882,575				58,907,497
2026(A)					14				1,738,731				7.1	%			10,850,000				6.8	%			6.24				5.0				137,382,883				19,125,726
2027					13				2,390,188				9.7	%			13,297,000				8.4	%			5.56				6.1				187,747,728				59,254,441
2028					10				2,172,458				8.9	%			11,857,000				7.5	%			5.46				6.8				153,000,879				40,945,705
2029					9				1,831,303				7.5	%			10,610,000				6.7	%			5.79				7.8				147,994,178				56,771,370
2030					5				1,102,002				4.5	%			8,490,000				5.3	%			7.70				8.8				129,463,623				62,140,891
2031					6				1,218,941				5.0	%			9,738,000				6.1	%			7.99				9.4				137,855,742				62,886,564
2032					8				2,131,983				8.7	%			18,862,000				11.9	%			8.85				10.8				291,154,266				154,426,474
2033					3				1,038,508				4.2	%			8,844,000				5.6	%			8.52				11.8				137,685,523				76,288,699
2034					3				1,561,256				6.4	%			9,365,000				5.9	%			6.00				12.8				127,748,518				74,253,759
2035					3				856,283				3.5	%			8,343,000				5.3	%			9.74				14.1				131,119,464				82,561,340
2041					1				657,518				2.7	%			5,458,000				3.4	%			8.30				19.4				93,235,690				55,945,982
Various tenants at retail shopping center					1				64,220				0.3	%			616,000				0.4	%			10.07				-0-				3,139,564				-0-
Vacant		(A)			1				80,856				0.3	%			-0-				0.0	%			-0-				-0-				2,518,657				-0-
Total as of 6/30/21					120				24,521,727				100.0	%		$	158,806,000				100.0	%		$	6.50				7.2			$	2,209,619,300		(B)		$856,674,849
Acquisitions Subsequent to 6/30/21
2036					1				143,794				0.6	%			3,233,000				1.9	%			22.48				14.9
Pro Forma Total with Acquisitions Subsequent to 6/30/21					121				24,665,521				100.0	%		$	162,039,000				100.0	%		$	6.59				7.2

 

	(A)	Included in 2023 is Altec Industries and included in 2026 is Woodstream Corporation, which both occupy one property. Included in 2025 is NF&M International, which occupies 174,802 square feet of a 255,658 square foot Industrial Park. The remaining 80,856 square feet are included in Vacant. Each of these properties are counted as one property in the Property Count Total. Other than these properties and one retail property, all properties are single-tenant.
	(B)	Does not include unamortized debt issuance costs of $7,681,337.

 

 

Recent Acquisitions During Fiscal 2021

(unaudited)

 

								Date of		Square				Annual				Rent Per				Lease		Purchase				Initial Mortgage
No		Tenant		City (MSA)		State		Acquisition		Footage				Rent				sf Occup.				Expiration		Price				Balance
1		FedEx Ground Package System, Inc.		Plain City (Columbus)		OH		12/17/2020			500,268			$	4,569,000			$	9.13			9/30/2035		$	73,304,000			$	47,000,000
2		Home Depot U.S.A., Inc.		Locust Grove (Atlanta)		GA		12/24/2020			657,518				5,458,000				8.30			11/30/2040			95,935,000				57,000,000
		As of 6/30/21									1,157,786			$	10,027,000			$	8.66					$	169,239,000			$	104,000,000
		Acquisitions Subsequent to 6/30/21
3		FedEx Ground Package System, Inc.		Burlington		VT		07/29/2021			143,794			$	3,233,000				22.48			8/31/2034		$	54,789,000				-0-
		Pro Forma Total with Acquisitions Subsequent to 6/30/21									1,301,580			$	13,260,000			$	10.19					$	224,028,000			$	104,000,000

 

 

Property Table

(unaudited)

 

																								Rent				Lease Exp.
								Fiscal Year								Square				Annual				Per sf				Term in				Undepreciated				Mortgage
No		Tenant		City (MSA)		State		Acquisition				Occup.				Footage				Rent				Occup.				Years				Cost				Balance
1		Milwaukee Electric Tool Corporation		Olive Branch (Memphis, TN)		MS			2013				100.0	%			861,889			$	3,098,000			$	3.59				7.1			$	36,914,917			$	16,588,500
.2		Shaw Industries, Inc.		Savannah		GA			2018				100.0	%			831,764				3,563,000				4.28				6.3				56,025,945				26,792,654
3		ULTA, Inc.		Greenwood (Indianapolis)		IN			2015				100.0	%			671,354				2,782,000				4.14				4.1				37,773,835				16,233,638
4		Home Depot U.S.A., Inc.		Locust Grove (Atlanta)		GA			2021				100.0	%			657,518				5,458,000				8.30				19.4				93,235,690				55,945,982
5		Amazon.com.indc, LLC		Greenwood (Indianapolis)		IN			2020				100.0	%			615,747				4,991,000				8.11				13.2				79,363,910				49,323,176
6		Jim Beam Brands Company (Beam Suntory)		Frankfort (Lexington)		KY			2015				100.0	%			599,840				2,112,000				3.52				3.6				28,000,000				13,769,810
7		TreeHouse Private Brands, Inc.		Buckner (Louisville)		KY			2014				100.0	%			558,509				2,267,000				4.06				12.3				26,807,852				13,196,520
8		FedEx Ground Package System, Inc.		Plain City (Columbus)		OH			2021				100.0	%			500,268				4,569,000				9.13				14.3				71,741,593				45,955,361
9		FedEx Forward Depots, Inc.		Memphis		TN			2010				100.0	%			449,900				1,394,000				3.10				7.9				16,092,852				2,603,021
10		B. Braun Medical Inc.		Daytona Beach		FL			2018				100.0	%			399,440				2,330,000				5.83				11.7				30,871,732				16,436,710
11		UGN, Inc.		Monroe (Cincinnati)		OH			2015				100.0	%			387,000				2,107,000				5.44				12.7				21,576,756				11,734,063
12		Woodstream Corporation		St. Joseph		MO			2001				100.0	%			256,000				987,000				3.86				5.3				9,029,539				-0-
		Altec Industries, Inc.		St. Joseph		MO			2001				100.0	%			126,880				378,000				2.98				1.7				4,475,266				-0-
13		CBOCS Distribution, Inc. (Cracker Barrel)		Lebanon (Nashville)		TN			2011				100.0	%			381,240				1,490,000				3.91				3.0				14,215,126				-0-
14		FedEx Ground Package System, Inc.		Braselton (Atlanta)		GA			2018				100.0	%			373,750				3,801,000				10.17				11.7				60,237,411				34,269,304
15		Best Buy Warehousing Logistics, Inc.		Streetsboro (Cleveland)		OH			2012				100.0	%			368,060				1,725,000				4.69				0.6				19,600,000				7,508,796
16		Amazon.com Services, Inc. (Amazon.com, Inc.)		Mobile		AL			2018				100.0	%			362,942				2,065,000				5.69				7.4				33,052,316				15,893,528
17		FedEx Ground Package System, Inc.		Concord (Charlotte)		NC			2017				100.0	%			354,482				2,537,000				7.16				10.9				40,043,145				20,962,281
18		FedEx Ground Package System, Inc.		Mesquite (Dallas)		TX			2017				100.0	%			351,874				3,209,000				9.12				10.8				49,880,493				25,939,833
19		Toyota Tsusho America, Inc.		Lafayette		IN			2019				100.0	%			350,418				1,722,000				4.91				8.0				25,078,587				15,454,363
20		FedEx Ground Package System, Inc.		Trenton		NJ			2019				100.0	%			347,145				5,328,000				15.35				11.0				83,987,622				47,779,049
21		FedEx Ground Package System, Inc.		Walker (Grand Rapids)		MI			2017				100.0	%			343,483				2,106,000				6.13				10.6				31,654,987				16,329,177
22		FedEx Ground Package System, Inc.		Hamburg (Buffalo)		NY			2017				100.0	%			338,584				2,329,000				6.88				9.8				35,140,017				17,756,206
23		FedEx Ground Package System, Inc.		Concord (Charlotte)		NC			2016				100.0	%			330,717				2,237,000				6.76				4.1				33,053,688				14,514,340
24		FedEx Ground Package System, Inc.		Indianapolis		IN			2014				100.0	%			327,822				1,717,000				5.24				6.3				25,504,083				7,635,856
25		Autoneum North America, Inc.		Aiken (Augusta, GA)		SC			2017				100.0	%			315,560				1,746,000				5.53				10.8				21,040,396				12,221,167
26		FedEx Ground Package System, Inc.		Olathe (Kansas City)		KS			2016				100.0	%			313,763				2,553,000				8.14				9.9				34,388,619				16,545,478
27		FedEx Ground Package System, Inc.		Ft. Worth (Dallas)		TX			2015				100.0	%			312,923				2,394,000				7.65				8.8				35,648,449				16,747,643
28		FedEx Ground Package System, Inc.		Davenport (Orlando)		FL			2016				100.0	%			310,922				2,625,000				8.44				9.8				38,087,185				19,635,183
29		FedEx Ground Package System, Inc.		Jacksonville		FL			2015				100.0	%			304,859				1,998,000				6.55				8.5				30,925,530				12,908,433
30		Science Applications International Corporation		Hanahan (Charleston)		SC			2005				100.0	%			302,400				1,708,000				5.65				2.3				14,463,148				-0-
31		Amazon.com Services, Inc. (Amazon.com, Inc.)		Oklahoma City		OK			2018				100.0	%			300,000				1,948,000				6.49				6.3				29,878,942				16,721,349
32		International Paper Company		Kenton		OH			2017				100.0	%			298,472				1,281,000				4.29				6.2				18,730,500				9,758,566
33		Western Container Corp. (Coca-Cola)		Tolleson (Phoenix)		AZ			2003				100.0	%			288,045				1,409,000				4.89				5.8				16,824,226				1,333,843
34		FedEx Ground Package System, Inc.		Greensboro		NC			2020				100.0	%			286,281				3,002,000				10.49				13.8				46,710,877				28,688,046
35		International Paper Company		Edwardsville (Kansas City)		KS			2014				100.0	%			280,019				1,382,000				4.94				2.2				18,294,108				7,012,132
36		FedEx Ground Package System, Inc.		Charleston		SC			2018				100.0	%			265,318				2,713,000				10.23				12.0				46,576,380				25,582,685
37		NF&M International, Inc.		Monaca (Pittsburgh)		PA			1977				68.4	%			255,658				795,000				4.55				3.8				7,963,722				-0-
38		FedEx Ground Package System, Inc.		Orion		MI			2007				100.0	%			245,633				1,908,000				7.77				2.0				23,069,307				-0-
39		FedEx Ground Package System, Inc.		Homestead (Miami)		FL			2017				100.0	%			237,756				2,282,000				9.60				10.8				37,911,556				19,553,431
40		Anda Pharmaceuticals, Inc.		Olive Branch (Memphis, TN)		MS			2012				100.0	%			234,660				1,220,000				5.20				1.1				14,550,000				5,736,033
41		FedEx Ground Package System, Inc.		Colorado Springs		CO			2016				100.0	%			225,362				1,832,000				8.13				4.6				29,320,066				13,748,383
42		Mickey Thompson Performance Tires and Wheels (Goodyear Tire & Rubber Company)		Stow		OH			2017				100.0	%			219,765				1,537,000				6.99				6.2				18,934,065				10,284,946
43		Rinnai America Corporation		Griffin (Atlanta)		GA			2006				100.0	%			218,120				913,000				4.19				1.5				15,082,217				-0-
44		FedEx Ground Package System, Inc.		Ft. Myers		FL			2017				100.0	%			213,672				1,418,000				6.64				6.2				21,684,310				11,084,432
45		FedEx Ground Package System, Inc.		Burlington (Seattle/Everett)		WA			2016				100.0	%			210,445				1,962,000				9.32				9.2				30,369,301				14,569,993
46		FedEx Ground Package System, Inc.		Sauget (St. Louis, MO)		IL			2015				100.0	%			198,729				1,036,000				5.21				7.9				15,407,470				6,827,092
47		Anheuser-Busch, Inc.		Granite City (St. Louis, MO)		IL			2001				100.0	%			184,800				854,000				4.62				0.4				12,757,540				-0-
48		Carrier Enterprise, LLC (Carrier Global Corporation)		Carrollton (Dallas)		TX			2010				100.0	%			184,317				1,160,000				6.29				2.6				18,494,917				4,025,447
49		FedEx Ground Package System, Inc.		Spring (Houston)		TX			2014				100.0	%			181,176				1,581,000				8.73				3.3				19,328,922				6,106,876
50		Carlstar Group, LLC		Edwardsville (Kansas City)		KS			2003				100.0	%			179,280				771,000				4.30				2.1				7,282,986				-0-
51		FedEx Ground Package System, Inc.		Ft. Mill (Charlotte, NC)		SC			2010				100.0	%			176,939				1,598,000				9.03				7.2				17,063,643				-0-
52		FedEx Ground Package System, Inc.		Covington (New Orleans)		LA			2016				100.0	%			175,315				1,274,000				7.27				4.0				18,425,875				9,111,843
53		FedEx Ground Package System, Inc.		Tampa		FL			2004				100.0	%			174,975				1,624,000				9.28				5.1				19,745,245				-0-
54		FedEx Ground Package System, Inc.		Livonia (Detroit)		MI			2013				100.0	%			172,668				1,194,000				6.92				0.8				13,887,897				4,446,791
55		Home Depot U.S.A., Inc.		Montgomery (Chicago)		IL			2004				100.0	%			171,230				1,079,000				6.30				1.5				11,303,317				-0-
56		FedEx Ground Package System, Inc.		Edinburg		TX			2011				100.0	%			164,207				1,097,000				6.68				5.3				12,039,014				-0-
57		FedEx Ground Package System, Inc.		Lindale (Tyler)		TX			2015				100.0	%			163,383				725,000				4.44				3.0				10,021,240				4,503,798
58		Bunzl Distribution Midcentral, Inc.		Kansas City		MO			2015				100.0	%			158,417				714,000				4.51				5.3				10,003,235				-0-
59		FedEx Ground Package System, Inc.		Oklahoma City		OK			2012				100.0	%			158,340				1,048,000				6.62				4.1				12,624,833				1,913,054
60		Magna Seating of America, Inc.		Lancaster (Columbus)		OH			2020				100.0	%			152,995				1,201,000				7.85				8.6				17,557,830				8,511,498

 

 

Property Table

(unaudited)

 

																								Rent				Lease Exp.
								Fiscal Year								Square				Annual				Per sf				Term in				Undepreciated				Mortgage
No		Tenant		City (MSA)		State		Acquisition				Occup.				Footage				Rent				Occup.				Years				Cost				Balance
61		FedEx Ground Package System, Inc.		Waco		TX			2012				100.0	%			150,710			$	1,078,000			$	7.15				4.2			$	12,551,368			$	3,364,812
62		FedEx Ground Package System, Inc.		Beltsville (Washington, DC)		MD			2001				100.0	%			148,881				1,455,000				9.77				7.1				14,632,389				-0-
63		Victory Packaging, L.P.		Fayetteville		NC			1997				100.0	%			148,000				504,000				3.41				3.7				5,458,279				-0-
64		FedEx Ground Package System, Inc.		El Paso		TX			2006				100.0	%			144,199				1,345,000				9.33				2.3				12,431,192				-0-
65		FedEx Ground Package System, Inc.		Cocoa		FL			2008				100.0	%			144,138				1,112,000				7.71				3.3				14,127,449				-0-
66		FedEx Ground Package System, Inc.		Cudahy (Milwaukee)		WI			2001				100.0	%			139,564				827,000				5.93				6.0				9,807,221				-0-
67		Challenger Lifts, Inc. (Snap-On Inc.)		Louisville		KY			2016				100.0	%			137,500				858,000				6.24				4.9				11,304,000				5,377,343
68		FedEx Ground Package System, Inc.		Richfield (Cleveland)		OH			2006				100.0	%			131,152				1,493,000				11.38				3.3				16,577,311				-0-
69		FedEx Ground Package System, Inc.		Savannah		GA			2019				100.0	%			126,520				1,765,000				13.95				7.3				27,531,560				15,321,954
70		General Electric Company		Imperial (Pittsburgh)		PA			2016				100.0	%			125,860				1,329,000				10.56				9.5				19,972,983				8,949,697
71		FedEx Ground Package System, Inc.		Wheeling (Chicago)		IL			2003				100.0	%			123,000				1,272,000				10.34				5.9				19,044,540				-0-
72		FedEx Ground Package System, Inc.		Altoona		PA			2014				100.0	%			122,522				651,000				5.31				2.2				9,022,966				2,098,202
73		FedEx Corporation		Charleston		SC			2018				100.0	%			121,683				1,314,000				10.80				11.2				21,538,966				11,641,536
74		Amazon.com Services, LLC		Oklahoma City		OK			2020				100.0	%			120,780				935,000				7.74				9.2				14,962,513				9,403,324
75		FedEx Corporation		Mechanicsville (Richmond)		VA			2001				100.0	%			112,799				541,000				4.80				1.8				7,836,425				-0-
76		FedEx Corporation		Orlando		FL			2008				100.0	%			110,621				666,000				6.02				6.4				8,810,059				-0-
77		Bunzl Distribution Oklahoma, Inc.		Oklahoma City		OK			2017				100.0	%			110,361				743,000				6.73				3.2				8,728,439				4,356,890
78		Style Crest, Inc.		Winston-Salem		NC			2002				100.0	%			106,507				433,000				4.07				4.8				7,421,032				-0-
79		Sonwil Distribution Center, Inc.		Cheektowaga (Buffalo)		NY			2002				100.0	%			104,981				630,000				6.00				0.6				10,960,823				-0-
80		FedEx Ground Package System, Inc.		West Chester Twp. (Cincinnati)		OH			2000				100.0	%			103,818				560,000				5.39				2.2				5,733,686				-0-
81		FedEx Ground Package System, Inc.		Roanoke		VA			2013				100.0	%			103,580				755,000				7.29				1.8				10,200,000				3,000,099
82		Pittsburgh Glass Works, LLC, a Division of VITRO		O’ Fallon (St. Louis)		MO			1994				100.0	%			102,135				508,000				4.97				5.0				4,249,615				-0-
83		FedEx Ground Package System, Inc.		Green Bay		WI			2013				100.0	%			99,102				468,000				4.72				1.9				6,570,000				1,702,945
84		Dakota Bodies, LLC		Liberty (Kansas City)		MO			1998				100.0	%			96,687				416,000				4.30				4.8				7,797,827				-0-
85		FedEx Corporation		Jacksonville		FL			1999				100.0	%			95,883				536,000				5.59				7.9				6,584,384				-0-
86		FedEx Corporation		Tampa		FL			2006				100.0	%			95,662				603,000				6.30				6.4				8,305,383				-0-
87		Amazon.com Services, Inc.		Hanahan (Charleston)		SC			2005				100.0	%			91,776				803,000				8.75				8.0				9,306,108				-0-
88		National Oilwell Varco, Inc.		Houston		TX			2010				100.0	%			91,295				801,000				8.77				8.3				8,190,901				671,412
89		Joseph T. Ryerson and Son, Inc.		Elgin (Chicago)		IL			2002				100.0	%			89,123				519,000				5.82				3.6				7,184,598				-0-
90		FedEx Corporation		Omaha		NE			1999				100.0	%			89,115				446,000				5.00				2.3				5,963,626				-0-
91		FedEx Ground Package System, Inc.		Huntsville		AL			2005				100.0	%			88,890				605,000				6.81				5.1				6,661,819				-0-
92		CHEP USA, Inc.		Roanoke		VA			2007				100.0	%			83,000				509,000				6.13				3.7				7,463,672				-0-
93		FedEx Corporation		Bedford Heights (Cleveland)		OH			2007				100.0	%			82,269				438,000				5.32				7.2				7,304,467				-0-
94		United Parcel Service, Inc.		Halfmoon (Albany)		NY			2012				100.0	%			75,000				595,000				7.93				9.8				6,741,021				-0-
95		FedEx Corporation		Schaumburg (Chicago)		IL			1997				100.0	%			73,500				478,000				6.50				5.8				5,447,053				-0-
96		FedEx Corporation		Romulus (Detroit)		MI			1998				100.0	%			71,933				421,000				5.85				4.9				4,949,251				-0-
97		FedEx Ground Package System, Inc.		Denver		CO			2005				100.0	%			69,865				609,000				8.72				4.3				6,374,068				-0-
98		FedEx Corporation		Ogden (Salt Lake City)		UT			2020				100.0	%			69,734				772,000				11.07				13.8				12,666,994				7,917,933
99		Tampa Bay Grand Prix		Tampa		FL			2005				100.0	%			68,385				369,000				5.40				6.3				5,677,982				-0-
100		Sherwin-Williams Company		Rockford		IL			2011				100.0	%			66,387				486,000				7.32				2.5				5,551,227				-0-
101		Various Tenants at Retail Shopping Center		Somerset		NJ			1970				95.0	%			64,220				616,000				10.07				na				3,139,564				-0-
102		Keurig Dr Pepper		Cincinnati		OH			2015				100.0	%			63,840				488,000				7.64				8.3				6,750,000				-0-
103		FedEx Corporation		Chattanooga		TN			2007				100.0	%			60,637				319,000				5.26				1.3				5,369,272				-0-
104		FedEx Ground Package System, Inc.		Stewartsville (Rochester)		MN			2013				100.0	%			60,370				372,000				6.16				1.9				5,231,864				1,364,689
105		Locke Supply Co.		Richmond		VA			2004				100.0	%			60,000				340,000				5.67				10.8				5,097,101				-0-
106		FedEx Ground Package System, Inc.		Augusta		GA			2005				100.0	%			59,358				513,000				8.64				2.0				5,363,304				-0-
107		Hartford Healthcare Corporation		Newington (Hartford)		CT			2001				100.0	%			54,812				307,000				5.60				9.8				3,525,917				-0-
108		Siemens Real Estate		Lebanon (Cincinnati)		OH			2012				100.0	%			51,130				464,000				9.07				2.8				4,554,684				-0-
109		FedEx Corporation		Charlottesville		VA			1999				100.0	%			48,064				329,000				6.85				6.2				4,462,009				-0-
110		FedEx Ground Package System, Inc.		Corpus Christi		TX			2012				100.0	%			46,253				454,000				9.82				5.2				4,808,329				-0-
111		Keurig Dr Pepper		Tulsa		OK			2014				100.0	%			46,240				269,000				5.82				2.7				3,748,031				1,303,703
112		Heartland Coca-Cola Bottling Company, LLC (Coca-Cola)		Topeka		KS			2009				100.0	%			40,000				292,000				7.30				5.3				3,679,843				-0-
113		Collins Aerospace Systems (Raytheon Technologies Corporation)		Rockford		IL			2015				100.0	%			38,833				368,000				9.48				6.0				5,100,000				-0-
114		Foundation Building Materials, LLC		Urbandale (Des Moines)		IA			1994				100.0	%			36,270				179,000				4.94				6.5				2,543,770				-0-
115		FedEx Corporation		Richland (Jackson)		MS			1994				100.0	%			36,000				120,000				3.33				2.8				1,900,691				-0-

 

 

Property Table

(unaudited)

 

																								Rent				Lease Exp.
				City				Fiscal Year								Square				Annual				Per sf				Term in				Undepreciated				Mortgage
No		Tenant		(MSA)		State		Acquisition				Occup.				Footage				Rent				Occup.				Years				Cost				Balance
116		FedEx Corporation		Punta Gorda		FL			2007				100.0	%			34,624			$	284,000			$	8.20				6.0			$	4,133,510			$	-0-
117		FedEx Corporation		Lakeland		FL			2006				100.0	%			32,105				155,000				4.83				6.4				2,043,226				-0-
118		FedEx Corporation		Augusta		GA			2006				100.0	%			30,184				121,000				4.01				1.4				1,993,029				-0-
119		Graybar Electric Company		Ridgeland (Jackson)		MS			1993				100.0	%			26,340				122,000				4.63				4.1				2,901,362				-0-
120		Sherwin-Williams Company		Burr Ridge (Chicago)		IL			1997				100.0	%			12,500				162,000				12.96				5.3				1,876,367				-0-
		Total as of 6/30/21											99.7	%			24,521,727			$	158,806,000			$	6.50				7.2			$	2,209,619,300	(A)		$	856,674,849
		Acquisitions Subsequent to 6/30/21
121		FedEx Ground Package System, Inc.		Burlington		VT			2021				100.0	%			143,794				3,233,000				22.48				14.9
		Pro Forma Total with Acquisitions Subsequent to 6/30/21											99.7	%			24,665,521			$	162,039,000			$	6.59				7.2

 

(A)

Does not include unamortized debt issuance costs of $7,681,337.

 

 

Definitions

 

Investors and analysts following the real estate industry utilize funds from operations (“FFO”), adjusted funds from operations (“AFFO”), net operating income (“NOI”), Same Property NOI, Same Property Cash NOI, and earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) variously defined, as supplemental performance measures. While we believe net income available to common stockholders, as defined by accounting principles generally accepted in the United States of America (U.S. GAAP), is the most appropriate measure, we consider NOI, Same Property NOI, Same Property Cash NOI, Adjusted EBITDA, FFO and AFFO, given their wide use by and relevance to investors and analysts, appropriate supplemental performance measures. FFO, reflecting the assumption that real estate asset values rise or fall with market conditions, principally adjusts for the effects of U.S. GAAP depreciation and amortization of real estate assets. NOI provides a measure of rental operations, and does not factor in depreciation and amortization and non-property specific expenses such as interest expense and general and administrative expenses. Adjusted EBITDA provides a tool to further evaluate the ability to incur and service debt and to fund dividends and other cash needs. AFFO provides a supplemental tool to evaluate our performance. In addition, NOI, Same Property NOI, Same Property Cash NOI, Adjusted EBITDA, FFO and AFFO are commonly used in various ratios, pricing multiples, yields and returns and valuation of calculations used to measure financial position, performance and value. As used herein, we calculate the following non-U.S. GAAP measures as follows:

 

	●	FFO, as defined by The National Association of Real Estate Investment Trusts (Nareit), represents net income attributable to common shareholders, as defined by accounting principles generally accepted in the United States of America (U.S. GAAP), as defined under U.S. GAAP, excluding gains or losses from sales of previously depreciated real estate assets, impairment charges related to depreciable real estate assets, certain non-cash items such as real estate asset depreciation and amortization, plus our portion of these items related to our consolidated investment that we have a non-controlling interest in. Included in the Nareit FFO White Paper - 2018 Restatement, is an option pertaining to assets incidental to our main business in the calculation of Nareit FFO to make an election to include or exclude mark-to-market changes in the value recognized on these marketable equity securities. In conjunction with the adoption of the FFO White Paper - 2018 Restatement, for all periods presented, we have elected to exclude unrealized gains and losses from our investments in marketable equity securities from our FFO calculation. Nareit created FFO as a non-GAAP supplemental measure of REIT operating performance.
	●	AFFO is calculated as FFO, excluding stock-based compensation expense, depreciation of corporate office tenant improvements, amortization of deferred financing costs, gains on the sale of securities, lease termination income, non-recurring severance expense, non-recurring strategic alternatives & proxy costs, effect of non-cash U.S. GAAP straight-line rent adjustments and less recurring capital expenditures, plus our portion of these items related to our consolidated investment that we have a non-controlling interest in. Recurring capital expenditures are defined as all capital expenditures that are recurring in nature, excluding capital expenditures related to expansions at our current locations or capital expenditures that are incurred in conjunction with obtaining a new lease or a lease renewal.
	●	NOI from property operations is calculated as net income (loss) attributable to common shareholders, as defined by U.S. GAAP, plus net income (loss) attributable to non-controlling interest, plus preferred dividend expense, general & administrative expenses, non-recurring strategic alternatives & proxy costs, non-recurring severance expense, depreciation, amortization of capitalized lease costs & intangible assets and interest expense, including amortization of financing costs, unrealized holding (gains) or losses arising during the periods, less dividend income, realized gain on sale of securities transactions, realized gain on sale of real estate investment and lease termination income. The components of NOI consist of recurring rental and reimbursement revenue, less real estate taxes and operating expenses, such as insurance, utilities, and repairs and maintenance.
	●	Same Property NOI is calculated as the NOI of all properties owned during the entire periods presented with the exclusion of any properties expanded during the periods presented.
	●	Same Property Cash NOI is calculated as the Same Property NOI adjusted to exclude the effect of non-cash U.S. GAAP straight-line rent adjustment for the properties included in the Same Property NOI calculation.
	●	Adjusted EBITDA is net income (loss) attributable to common shareholders, as defined by U.S. GAAP, plus preferred dividends, interest expense, including amortization of financing costs, depreciation and amortization, net amortization of acquired above and below market lease revenue, plus our portion of these items related to our consolidated investment that we have a non-controlling interest in, non-recurring strategic alternatives & proxy costs and unrealized holding losses (minus gains) arising during the periods less realized gain on sale of real estate investment and realized gain on sale of securities transactions.

 

FFO, AFFO, NOI, Same Property NOI, Same Property Cash NOI and Adjusted EBITDA, do not represent cash generated from operating activities in accordance with U.S. GAAP and are not necessarily indicative of cash available to fund cash needs, including the repayment of principal on debt and payment of dividends and distributions. FFO, AFFO, NOI, Same Property NOI, Same Property Cash NOI and Adjusted EBITDA should not be considered as substitutes for net income applicable to common shareholders (calculated in accordance with U.S. GAAP) as a measure of results of operations or cash flows (calculated in accordance with U.S. GAAP) as a measure of liquidity. FFO, AFFO, NOI, Same Property NOI, Same Property Cash NOI and Adjusted EBITDA, as currently calculated by us, may not be comparable to similarly titled, but variously calculated, measures of other REITs.

 

 

 

FOR IMMEDIATE RELEASE
	August 2, 2021
	Contact: Becky Coleridge
	732-577-9996

 

MONMOUTH REAL ESTATE REPORTS RESULTS FOR

THE THIRD QUARTER ENDED JUNE 30, 2021

 

HOLMDEL, NJ, August 2, 2021........ Monmouth Real Estate Investment Corporation (NYSE:MNR) reported Net Income Attributable to Common Shareholders of $17.3 million or $0.17 per diluted share for the three months ended June 30, 2021 as compared to Net Income Attributable to Common Shareholders of $26.9 million or $0.27 per diluted share for the three months ended June 30, 2020, representing a decrease of $9.6 million or $0.10 per diluted share. During the three months ended June 30, 2021, we recognized a $16.5 million unrealized holding gain on securities or $0.17 per diluted share as compared to a $19.6 million unrealized holding gain on securities or $0.20 per diluted share for the three months ended June 30, 2020. Funds from Operations (FFO), which excludes unrealized and realized gains or losses from our securities portfolio, for the three months ended June 30, 2021 were $11.5 million or $0.12 per diluted share versus $19.7 million or $0.20 per diluted share for the three months ended June 30, 2020, representing a decrease of $8.2 million or $0.08 per diluted share. The decrease in Net Income Attributable to Common Shareholders and FFO is primarily attributable to non-recurring strategic alternatives and proxy costs of $8.7 million related to our strategic alternatives process, our pending merger with Equity Commonwealth and our proxy process. FFO excluding these non-recurring costs for the three months ended June 30, 2021 were $20.2 million or $0.20 per diluted share versus $19.7 million or $0.20 per diluted share for the three months ended June 30, 2020, representing unchanged per diluted share earnings. For the three months ended June 30, 2021, Adjusted Funds from Operations (AFFO), which excludes non-recurring items, including costs related to our strategic alternatives process and our proxy process and unrealized and realized gains or losses from our securities portfolio, were $19.7 million or $0.20 per diluted share compared to $19.5 million or $0.20 per diluted share for the three months ended June 30, 2020. Sequentially, our AFFO of $0.20 per diluted share for the third quarter of fiscal 2021 also was unchanged compared to our AFFO per diluted share for the second quarter of fiscal 2021. During the nine months ended June 30, 2021, we recognized a $55.4 million unrealized holding gain on our securities portfolio representing $0.56 per diluted share as compared to a $67.1 million unrealized holding loss on securities or $0.69 per diluted share for the nine months ended June 30, 2020.

 

A summary of significant financial information for the three and nine months ended June 30, 2021 and 2020 (in thousands, except per share amounts) is as follows:

 

		Three Months Ended June 30,
		2021				2020
Rental Revenue		$	39,032			$	35,427
Reimbursement Revenue		$	6,962			$	6,348
Net Operating Income (NOI) (1)		$	38,904			$	35,045
Total Expenses		$	32,040			$	21,459
Dividend Income		$	1,486			$	2,344
Realized Gain on Sale of Real Estate Investment		$	6,376			$	-0-
Unrealized Holding Gains Arising During the Periods		$	16,471			$	19,610
Net Income		$	28,602			$	33,295
Net Income Attributable to Common Shareholders		$	17,292			$	26,851
Net Income Attributable to Common Shareholders Per Diluted Common Share		$	0.17			$	0.27
FFO (1)		$	11,502			$	19,721
FFO per Diluted Common Share (1)		$	0.12			$	0.20
FFO Excluding Non-recurring Strategic Alternatives & Proxy Costs (1)		$	20,159			$	19,721
FFO Excluding Non-recurring Strategic Alternatives & Proxy Costs per Diluted Common Share (1)		$	0.20			$	0.20
AFFO (1)		$	19,701			$	19,463
AFFO per Diluted Common Share (1)		$	0.20			$	0.20
Dividends Declared per Common Share		$	0.18			$	0.17
Weighted Avg. Diluted Common Shares Outstanding			98,539				97,962

 

 

		Nine Months Ended June 30,
		2021				2020
Rental Revenue		$	115,123			$	105,410
Reimbursement Revenue		$	20,818			$	19,772
Lease Termination Income		$	377			$	-0-
Net Operating Income (NOI) (1)		$	114,256			$	104,633
Total Expenses		$	79,820			$	65,151
Dividend Income		$	4,681			$	8,987
Realized Gain on Sale of Real Estate Investment		$	6,376			$	-0-
Realized Gain on Sale of Securities Transactions		$	2,248			$	-0-
Unrealized Holding Gains (Losses) Arising During the Periods		$	55,377			$	(67,100	)
Net Income (Loss)		$	96,949			$	(25,317	)
Net Income (Loss) Attributable to Common Shareholders		$	68,950			$	(44,700	)
Net Income (Loss) Attributable to Common Shareholders Per Diluted Common Share		$	0.71			$	(0.46	)
FFO (1)		$	50,982			$	59,205
FFO per Diluted Common Share (1)		$	0.52			$	0.61
FFO Excluding Non-recurring Strategic Alternatives & Proxy Costs (1)		$	61,878			$	59,205
FFO Excluding Non-recurring Strategic Alternatives & Proxy Costs per Diluted Common Share (1)		$	0.63			$	0.61
AFFO (1)		$	57,507			$	58,705
AFFO per Diluted Common Share (1)		$	0.58			$	0.60
Dividends Declared per Common Share		$	0.53			$	0.51
Weighted Avg. Diluted Common Shares Outstanding			98,415				97,626

 

A summary of significant balance sheet information as of June 30, 2021 and September 30, 2020 (in thousands) is as follows:

 

		June 30, 2021				September 30, 2020
Cash and Cash Equivalents		$	90,896			$	23,517
Real Estate Investments		$	1,876,906			$	1,747,844
Securities Available for Sale at Fair Value		$	148,382			$	108,832
Total Assets		$	2,178,078			$	1,939,783
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs		$	848,994			$	799,507
Loans Payable		$	165,000			$	75,000
Total Shareholders’ Equity		$	1,135,847			$	1,037,605

 

During the third quarter, we accomplished the following:

 

	●	Increased our Rental and Reimbursement Revenue by 10% over the prior year period to $46.0 million;
	●	Increased our Net Operating Income by 11% over the prior year period to $38.9 million;
	●	Increased our Gross Leasable Area (GLA) by 5% over the prior year period to 24.5 million square feet;
	●	Grew our acquisition pipeline to six new build-to-suit properties containing 1.8 million total square feet representing an aggregate cost of $238.4 million, all of which will be leased to Investment Grade tenants,. Subsequent to the quarter end, we acquired one of these properties for $54.8 million representing 144,000 square feet;
	●	Completed a parking lot expansion for UPS at our property located in Halfmoon, NY for approximately $835,000, resulting in an initial increase in annual rent of approximately $52,000 with 2% annual increases;
	●	Increased our overall occupancy rate by 30 basis points over the prior year period to a sector leading 99.7% currently;
	●	Renewed all ten leases set to expire during fiscal 2021. These ten lease renewals, comprising 1.2 million square feet resulted in a 6.2% increase in GAAP rent, a 0.4% increase in cash rent, and have a weighted average lease renewal term of 4.2 years;
	●	Maintained a weighted average lease term of 7.2 years consistent with the prior year period;

 

 

	●	Increased our annualized average base rent per occupied square foot to $6.50, an increase of 2% compared to the prior year period;
	●	Maintained a weighted average debt maturity on our fixed-rate mortgage debt of 11.1 years;
	●	Reduced the weighted average interest rate on our fixed-rate mortgage debt to 3.86% from 4.00% in the prior year period;
	●	Reported $16.5 million in unrealized gains on our securities portfolio for the three months ended June 30, 2021. In addition, reported $55.4 million in unrealized gains on our securities portfolio for the nine months ended June 30, 2021.

 

Highlights from the Third Quarter of Fiscal 2021:

 

●	Acquisitions. Through the third quarter end, Monmouth has completed the acquisitions of two high quality properties comprising 1.1 million square feet for an aggregate purchase price of $170.0 million and are expected to generate $10.1 million in annual rent. In addition, subsequent to quarter end, we acquired one building comprising 144,000 square feet situated on 43.4 acres located in the Burlington, VT MSA for $54.8 million. This property is leased to FedEx Ground for 15 years and is expected to generate $3.2 million in annual rent.
●	Pipeline. Monmouth’s $183.6 million acquisition pipeline currently contains five new build-to-suit properties, comprising 1.6 million total square feet. These properties have a weighted average lease term of 13.4 years and are expected to generate $10.5 million in annual rent. These projects are all leased to investment grade tenants, with 68% leased to FedEx Ground and 32% leased to Mercedes Benz.
●	Parking Expansion Projects. The Company currently has eight FedEx Ground parking expansion projects underway that it expects to cost approximately $37.3 million. These parking expansion projects will result in additional rent and extensions to the existing lease terms. We are also in discussions to expand parking at nine additional locations.
●	Lease Renewals. The Company has renewed all ten leases that were set to expire this fiscal year representing 1.2 million square feet. These lease renewals have a weighted average lease term of 4.2 years, and a weighted average lease rate of $4.77 per square foot on a GAAP basis and $4.66 on a cash basis. This represents an increase of 6.2% on a GAAP basis and an increase of 0.4% on a cash basis.
●	Key Financial Metrics and Ratios. At quarter end, Monmouth’s weighted average lease maturity was 7.2 years and its weighted average mortgage debt maturity was 11.1 years. For the quarter, Net Debt to Adjusted EBITDA was at 6.0x, Fixed Charge Coverage at 2.1x, and Net Debt to Total Market Capitalization at 27%. The Company’s occupancy rate has been over 98.9% for six consecutive years and its weighted average lease term has exceeded seven years for seven consecutive years.
●	Securities Portfolio. At quarter end, the Company’s $148.4 million securities portfolio represented 5.9% of its undepreciated assets. Securities Available for Sale increased by $16.7 million during the current quarter and increased by $39.6 million from September 30, 2020 to June 30, 2021. The increase was primarily due to an Unrealized Holding Gain of $16.5 million during the three months ended and an Unrealized Holding Gain of $55.4 million for the nine months ended June 30, 2021. There were also sales and redemptions of securities during the nine month period totaling $18.8 million which resulted in a realized gain of $2.2 million. Our investment in UMH Properties is now showing a 118% gain, or $17 million not including substantial dividends.
●	Asset Sale. During the quarter, on April 15, 2021, Monmouth sold its 60,400 square foot building located in Carlstadt, NJ for $13.0 million. The Company owned a 51% interest in this property. Its 51% portion of the sale proceeds resulted in a U.S. GAAP net realized gain of approximately $3.3 million, representing a 159% gain over its depreciated basis and a net realized gain of approximately $2.6 million, or a 96% net gain over its historic undepreciated cost.

 

Merger Transaction with Equity Commonwealth

 

As previously announced, in January 2021, our Board of Directors unanimously decided to explore strategic alternatives to maximize shareholder value. Following a comprehensive strategic alternatives process, on May 4, 2021, we entered into a definitive merger agreement with Equity Commonwealth (“EQC”), a New York Stock Exchange traded real estate investment trust, under which, on the terms and subject to the conditions set forth in the merger agreement, we will merge with and into a new wholly-owned subsidiary of Equity Commonwealth, resulting in Equity Commonwealth acquiring us in an all-stock transaction. The merger agreement provides that, upon closing of the merger, our common stockholders will be entitled to receive 0.67 shares of Equity Commonwealth common stock for every share of Monmouth common stock they own and the outstanding shares of Monmouth common stock will be extinguished. We plan to continue to pay our regular quarterly common stock dividend and our quarterly Series C Cumulative Redeemable Preferred Stock dividend until closing of the merger. Under the terms of the definitive merger agreement, upon closing of the merger, each holder of our 6.125% Series C Preferred Stock will be entitled to receive an amount in cash equal to $25.00 per share plus accumulated and unpaid dividends and the outstanding shares of our 6.125% Series C Cumulative Redeemable Preferred Stock will be extinguished. The merger transaction is expected to close during the second half of calendar 2021, subject to customary closing conditions, including approval by common stockholders of both Equity Commonwealth and MREIC. Equity Commonwealth and MREIC stockholders are expected to own approximately 65% and 35%, respectively, of the pro forma company following the close of the transaction. On July 23, 2021, we filed with the SEC, and shortly thereafter began distributing to our stockholders, a definitive joint proxy statement/prospectus of MREIC and EQC pursuant to which both MREIC and EQC are seeking approval of the merger from their respective stockholders at special stockholder meetings that have been called for August 24, 2021.

 

 

Under the terms of the merger agreement, Monmouth plans to continue to pay its regular quarterly common stock dividend and its Series C Cumulative Redeemable Preferred Stock dividend between signing and closing of the transaction. Equity Commonwealth expects to begin paying a quarterly dividend after the transaction has closed. The Equity Commonwealth Board of Trustees will determine the timing and amount of the dividend.

 

In light of the pending transaction with Equity Commonwealth, we do not intend to host a conference call or webcast in connection with our third quarter FY 2021 financial results. The results will be available on the Company’s website at www.mreic.reit in the Investor Relations section, under Filings and Reports.

 

Monmouth Real Estate Investment Corporation, founded in 1968, is one of the oldest public equity REITs in the world. We specialize in single tenant, net-leased industrial properties, subject to long-term leases, primarily to investment-grade tenants. Monmouth Real Estate is a fully integrated and self-managed real estate company, whose property portfolio consists of 121 properties, containing a total of approximately 24.7 million rentable square feet, geographically diversified across 32 states. Our occupancy rate is currently 99.7%, our weighted average building age is currently 10 years, and our percentage of revenue derived from Investment Grade tenants or their subsidiaries is currently 83%.

 

Certain statements included in this press release which are not historical facts may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements are based on our current expectations and involve various risks and uncertainties. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can provide no assurance those expectations will be achieved. The risks and uncertainties that could cause actual results or events to differ materially from expectations include risks and uncertainties relating to the proposed merger with Equity Commonwealth and other risks and uncertainties described in our annual report on Form 10-K and in our other filings with the SEC. We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.

 

Additional Information and Where to Find It

 

In connection with the proposed merger between Monmouth and EQC, EQC has filed a registration statement on Form S-4 with the SEC, which became effective on July 23, 2021, to register the common shares of beneficial interest of EQC to be issued pursuant to the merger. The registration statement includes a joint proxy statement/prospectus which has been filed by EQC and Monmouth with the SEC and has been sent to the common shareholders of EQC seeking their approval of the share issuance and to the common shareholders of Monmouth seeking their approval of the merger (the “joint proxy statement/prospectus”). EQC and Monmouth may also file other documents regarding the proposed merger and share issuance with the SEC. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS ARE URGED TO CAREFULLY READ THE ENTIRE REGISTRATION STATEMENT AND THE JOINT PROXY STATEMENT/PROSPECTUS, AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER AND SHARE ISSUANCE. Investors and security holders may obtain free copies of the registration statement and joint proxy statement/prospectus and other documents filed with the SEC by EQC or Monmouth through the website maintained by the SEC at www.sec.gov. In addition, investors and security holders may obtain free copies of the registration statement and the joint proxy statement/prospectus and other documents filed with the SEC by EQC on EQC’s website at www.eqcre.com and may obtain free copies of the joint proxy statement/prospectus and other documents filed with the SEC by Monmouth on Monmouth’s website at www.mreic.reit.

 

Notes:

 

(1) Non-U.S. GAAP Information: FFO, as defined by The National Association of Real Estate Investment Trusts (NAREIT), represents net income attributable to common shareholders, as defined by accounting principles generally accepted in the United States of America (U.S. GAAP), excluding gains or losses from sales of previously depreciated real estate assets, impairment charges related to depreciable real estate assets, certain non-cash items such as real estate asset depreciation and amortization, plus our portion of these items related to our consolidated investment that we have a non-controlling interest in. Included in the NAREIT FFO White Paper - 2018 Restatement, is an option pertaining to assets incidental to our main business in the calculation of NAREIT FFO to make an election to include or exclude mark-to-market changes in the value recognized on these marketable equity securities. In conjunction with the adoption of the FFO White Paper - 2018 Restatement, for all periods presented, we have elected to exclude unrealized gains and losses from our investments in marketable equity securities from our FFO calculation. NAREIT created FFO as a non-GAAP supplemental measure of REIT operating performance. Our calculation of Adjusted Funds From Operations (AFFO) differs from NAREIT’s definition of AFFO because we exclude certain items that we view as nonrecurring or impacting comparability from period to period. We define AFFO as FFO, excluding stock based compensation expense, depreciation of corporate office tenant improvements, amortization of deferred financing costs, realized gain on sale of securities, lease termination income, non-recurring strategic alternatives & proxy costs, non-recurring severance expense, effect of non-cash U.S. GAAP straight-line rent adjustments and subtracting recurring capital expenditures, plus our portion of these items related to our equity investments that our investees have a non-controlling interest in. We define recurring capital expenditures as all capital expenditures that are recurring in nature, excluding capital expenditures related to expansions at our current locations or capital expenditures that are incurred in conjunction with obtaining a new lease or a lease renewal. We believe that, as widely recognized measures of performance used by other REITs, FFO and AFFO may be considered by investors as supplemental measures to compare our operating performance to those of other REITs. FFO and AFFO exclude historical cost depreciation as an expense and may facilitate the comparison of REITs which have a different cost basis. However, other REITs may use different methodologies to calculate FFO and AFFO and, accordingly, our FFO and AFFO may not be comparable to all other REITs. The items excluded from FFO and AFFO are significant components in understanding our financial performance.

 

FFO and AFFO are non-GAAP performance measures and (i) do not represent Cash Flow from Operations as defined by U.S. GAAP; (ii) should not be considered as an alternative to Net Income or Net Income Attributable to Common Shareholders as a measure of operating performance or to Cash Flows from Operating, Investing and Financing Activities; and (iii) are not an alternative to Cash Flows from Operating, Investing and Financing Activities as a measure of liquidity. FFO and AFFO, as calculated by us, may not be comparable to similarly titled measures reported by other REITs.

 

 

The following is a reconciliation of the Company’s U.S. GAAP Net Income (Loss) Attributable to Common Shareholders to the Company’s FFO and AFFO for the three and nine months ended June 30, 2021 and 2020 (in thousands):

 

		Three Months Ended								Nine Months Ended
		6/30/2021				6/30/2020				6/30/2021				6/30/2020
Net Income (Loss) Attributable to Common Shareholders		$	17,292			$	26,851			$	68,950			$	(44,700	)
Less/Plus: Unrealized Holding (Gains) Losses Arising During the Periods			(16,471	)			(19,610	)			(55,377	)			67,100
Plus: Depreciation Expense (excluding Corporate Office Capitalized Costs)			12,960				11,672				37,959				34,436
Plus: Amortization of Intangible Assets			599				524				1,731				1,539
Plus: Amortization of Capitalized Lease Costs			374				284				971				830
Less: Realized Gain on Sale of Real Estate Investment (1)			(3,252	)			-0-				(3,252	)			-0-
FFO Attributable to Common Shareholders (2)			11,502				19,721				50,982				59,205
Plus: Depreciation of Corporate Office Capitalized Costs			57				57				172				176
Plus: Stock Compensation Expense			77				98				210				368
Plus: Amortization of Financing Costs			350				326				1,026				1,082
Plus: Non-recurring Strategic Alternatives & Proxy Costs			8,657				-0-				10,896				-0-
Plus: Non-recurring Severance Expense			-0-				-0-				-0-				786
Less: Realized Gain on Sale of Securities Transactions			-0-				-0-				(2,248	)			-0-
Less: Lease Termination Income			-0-				-0-				(377	)			-0-
Less: Recurring Capital Expenditures			(229	)			(508	)			(791	)			(1,443	)
Less: Effect of Non-cash U.S. GAAP Straight-line Rent Adjustment			(713	)			(231	)			(2,363	)			(1,469	)
AFFO Attributable to Common Shareholders		$	19,701			$	19,463			$	57,507			$	58,705

 

	(1)	Represents our portion of the net realized gain from the sale of our property that we owned a 51% interest in.
	(2)	FFO Attributable to Common Shareholders for the three and nine months ended June 30, 2021 includes Non-recurring Strategic Alternatives & Proxy Costs of $8.7 million and $10.9 million, respectively. FFO Attributable to Common Shareholders for the three and nine months ended June 30, 2021 excluding these Non-recurring Strategic Alternatives & Proxy Costs is $20.2 million and $61.9 million, respectively.

 

The following are the Cash Flows provided (used) by Operating, Investing and Financing Activities for the nine months ended June 30, 2021 and 2020 (in thousands):

 

		Nine Months Ended
		6/30/2021				6/30/2020
Operating Activities		$	76,768			$	74,964
Investing Activities			(145,246	)			(163,049	)
Financing Activities			135,857				80,010

 

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