FALSE000179810000017981002025-02-242025-02-24
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): February 24, 2025
NETSTREIT Corp.
(Exact Name of Registrant as Specified in its Charter)
| | | | | | | | | | | |
| Maryland | 001-39443 | 84-3356606 |
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
2021 McKinney Avenue Suite 1150 Dallas, Texas | 75201 |
| (Address of Principal Executive Offices) | (Zip Code) |
972-200-7100
(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 each exchange on which registered |
Common Stock, $0.01 par value per share | NTST | The 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 February 24, 2025, NETSTREIT Corp. (the “Company”) issued a press release announcing its financial results for the fourth quarter and full year ended December 31, 2024. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated by reference herein.
The information contained in Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended (“Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 7.01. Regulation FD Disclosure.
On February 24, 2025, the Company furnished supplemental financial information for the fourth quarter and full year ended December 31, 2024. Also on February 24, 2025, the Company furnished an updated investor presentation. The supplemental financial information and investor presentation are attached hereto as Exhibits 99.2 and 99.3, respectively, and incorporated by reference herein. The supplemental information and investor presentation also are available on the “Investors / Events & Presentations” page of the Company’s website at www.netstreit.com. The information found on, or otherwise accessible through, the Company’s website is not incorporated by reference herein.
The information contained in Exhibits 99.2 and 99.3 shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference in any filing under the Securities Act 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. |
| Exhibit No. | | Description | |
| 99.1 | | | |
| 99.2 | | | |
| 99.3 | | | |
| 104 | | Cover page interactive data file (embedded within the inline XBRL document). | |
SIGNATURE
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.
| | | | | | | | | | | | | | |
| | | NETSTREIT Corp. |
| | | |
| February 24, 2025 | | /s/ DANIEL DONLAN |
| Date | | Daniel Donlan |
| | | Chief Financial Officer and Treasurer |
| | | (Principal Financial Officer) |
NETSTREIT REPORTS FOURTH QUARTER AND FULL YEAR 2024 FINANCIAL AND OPERATING RESULTS
– Net loss of $(0.07) and Adjusted Funds from Operations ("AFFO") of $0.32 Per Diluted Share for Fourth Quarter –
– Completed Record Gross Investment Activity of $195.1 Million at 7.4% Blended Cash Yield for Fourth Quarter –
– Introduces 2025 AFFO Per Share Guidance of $1.27 to $1.30 –
– Closed $275.0 Million in Additional Financing Commitments in January 2025 –
Dallas, TX – February 24, 2025 – NETSTREIT Corp. (NYSE: NTST) (the “Company”) today announced financial and operating results for the fourth quarter and year ended December 31, 2024.
“I am pleased to report that NETSTREIT delivered solid 2024 results, which included a Company record $195.1 million of investments at a 7.4% cash yield in the fourth quarter. Furthermore, we accretively recycled capital with record dispositions of $59.3 million in the fourth quarter and made significant progress towards our portfolio diversification goals. While our balance sheet remains well positioned for future growth, we are adopting a measured approach towards capital deployment to start 2025 with a continued focus on quality net lease investments that enhance our tenant diversity and strengthen our internal growth profile,” said Mark Manheimer, Chief Executive Officer of NETSTREIT.
FOURTH QUARTER AND FULL YEAR 2024 HIGHLIGHTS
The following table summarizes the Company's select financial results1 for the three months and year ended December 31, 2024.
| | | | | | | | | | | | | | | | | |
| Three Months Ended December 31, |
| 2024 | | 2023 | | % Change |
| (Unaudited) |
Net (Loss) per Diluted Share | $ | (0.07) | | | $ | 0.03 | | | (333.3) | % |
| Funds from Operations per Diluted Share | $ | 0.32 | | | $ | 0.30 | | | 6.7 | % |
| Core Funds from Operations per Diluted Share | $ | 0.32 | | | $ | 0.30 | | | 6.7 | % |
| Adjusted Funds from Operations per Diluted Share | $ | 0.32 | | | $ | 0.31 | | | 3.2 | % |
| | | | | | | | | | | | | | | | | |
| Year Ended December 31, |
| 2024 | | 2023 | | % Change |
| (Unaudited) |
Net (Loss) per Diluted Share | $ | (0.16) | | | $ | 0.11 | | | (245.5) | % |
| Funds from Operations per Diluted Share | $ | 1.20 | | | $ | 1.18 | | | 1.7 | % |
| Core Funds from Operations per Diluted Share | $ | 1.26 | | | $ | 1.19 | | | 5.9 | % |
| Adjusted Funds from Operations per Diluted Share | $ | 1.26 | | | $ | 1.22 | | | 3.3 | % |
1.Funds from operations ("FFO"), core funds from operations ("Core FFO"), and adjusted funds from operations ("AFFO") are non-GAAP financial measures. See "Non-GAAP Financial Measures."
INVESTMENT ACTIVITY
The following tables summarize the Company's investment, disposition, and loan repayment activities (dollars in thousands) for the three months and year ended December 31, 2024.
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended
December 31, 2024 | | Year Ended December 31, 2024 |
| Number of Investments | | Amount | | Number of Investments | | Amount |
| Investments | 52 | | $ | 195,079 | | | 155 | | $ | 591,574 |
Dispositions | 30 | | 59,337 | | | 56 | | 117,744 |
Loan Repayments | 6 | | 13,627 | | | 11 | | 24,808 | |
| Net Investment Activity | | | $ | 122,115 | | | | | $ | 449,023 | |
| | | | | | | |
| Investment Activity | | | | | | | |
| Cash Yield | | | 7.4 | % | | | | 7.5 | % |
| % of ABR derived from Investment Grade Tenants | | | 34.7 | % | | | | 46.6 | % |
| % of ABR derived from Investment Grade Profile Tenants | | | 13.9 | % | | | | 9.0 | % |
| Weighted Average Lease Term (years) | | | 14.0 | | | | | 13.6 | |
| | | | | | | |
| Disposition Activity | | | | | | | |
Cash Yield | | | 7.1 | % | | | | 7.0 | % |
| Weighted Average Lease Term (years) | | | 11.4 | | | | | 10.8 | |
| | | | | | | |
Loan Repayments | | | | | | | |
Cash Yield | | | 9.3 | % | | | | 9.2 | % |
The following table summarizes the Company's ongoing development projects and estimated development costs (dollars in thousands) as of and for the three months ended December 31, 2024.
| | | | | |
| Developments | Three Months Ended
December 31, 2024 |
Amount Funded During the Quarter | $ | 1,789 | |
| |
| As of December 31, 2024 |
| Number of Developments | 5 | |
Amount Funded to Date | $ | 7,883 | |
Estimated Funding Remaining on Developments | 6,718 | |
| Total Estimated Development Cost | $ | 14,601 | |
PORTFOLIO UPDATE
The following table summarizes the Company's real estate portfolio (weighted by ABR, dollars in thousands) as of December 31, 2024.
| | | | | |
| As of December 31, 2024 |
| Number of Investments | 687 |
| ABR | $ | 165,070 |
| States | 45 |
| Square Feet | 12,609,612 |
| Tenants | 98 |
| Industries | 26 |
| Occupancy | 99.9 | % |
| Weighted Average Lease Term (years) | 9.8 |
| Investment Grade % | 55.8 | % |
| Investment Grade Profile % | 15.0 | % |
CAPITAL MARKETS AND BALANCE SHEET
The following tables summarize the Company's leverage, balance sheet, ATM sales, and settlement of our forward equity offerings (dollars in thousands, except per share data) as of and for the three months ended December 31, 2024.
| | | | | |
| Leverage | As of December 31, 2024 |
Net Debt / Annualized Adjusted EBITDAre | 5.8x |
Adjusted Net Debt / Annualized Adjusted EBITDAre | 4.5x |
| |
Forward Equity Settlement Activity | As of December 31, 2024 |
Shares Settled During Quarter | — | |
Weighted Average Price Per Share (Gross) | $ | — | |
Net Value of Settled Forward Equity as of December 31, 2024 | $ | — | |
| |
| ATM Program | As of December 31, 2024 |
Shares Sold During Quarter | — | |
Weighted Average Price Per Share (Gross) | $ | — | |
ATM Program Total Capacity | $ | 300,000 | |
ATM Capacity Remaining as of December 31, 2024 | $ | 297,387 | |
| |
Unsettled Forward Equity | As of December 31, 2024 |
Shares Unsettled as of December 31, 2024 | 10,735,647 | |
Weighted Average Price Per Share (Gross) | $ | 17.93 | |
Net Value of Unsettled Forward Equity as of December 31, 2024 | $ | 185,063 | |
SUBSEQUENT DEBT ACTIVITY
On January 15, 2025, the Company closed on $275.0 million in additional financing commitments and amendments to its existing credit facilities, which includes a new $175.0 million senior unsecured term loan (the "2030 Term Loan B") and an upsized, $500.0 million revolving credit facility (the "Revolving Facility"), increased from $400.0 million. The 2030 Term Loan B and the Revolving Facility initially mature in January 2029 and each include a one-year option to extend the maturity to January 2030 at the Company's discretion. The 2030 Term Loan B was fully funded at close and the Company hedged the entire $175.0 million at an all-in fixed interest rate of 5.12% through January 2030.
In addition, the Company extended the maturity date of the existing $175.0 million senior unsecured term loan from January 2027 to January 2029 with an option to extend the maturity to January 2030 at the Company's discretion, and amended existing credit agreements to remove certain financial covenants and provide for revised, improved pricing when the Company meets certain investment grade rating and leverage targets.
The following tables summarize the terms of the 2030 Term Loan B (dollars in thousands), and the Company's proforma liquidity as of December 31, 2024.
| | | | | |
2030 Term Loan B | |
| Fully Extended Maturity Date | January 2030 |
| Maximum Available Principal (Fully Drawn) | $ | 175,000 |
| All-In Fixed Interest Rate | 5.12 | % |
| |
| Proforma Liquidity | As of December 31, 2024 |
Unused unsecured revolver capacity(1) | $ | 435,850 |
| Cash, cash equivalents and restricted cash | 14,320 |
Net value of unsettled forward equity | 185,063 |
| Total Proforma Liquidity | $ | 635,233 |
1.Assumes the entry into the 2030 Term Loan B, which was used to pay down our Revolving Facility, and the concurrent increase in our revolver capacity to $500.0 million occurred on December 31, 2024.
DIVIDEND
On February 21, 2025, the Company’s Board of Directors declared a quarterly cash dividend of $0.21 per share for the first quarter of 2025. On an annualized basis, the dividend of $0.84 per share of common stock represents an increase of $0.02 per share over the prior year annualized dividend. The dividend will be paid on March 31, 2025 to shareholders of record on March 14, 2025.
2025 GUIDANCE
The Company is initiating its full year 2025 AFFO per share guidance in the range of $1.27 to $1.30. The Company also expects 2025 net investment activity to be in the range of $75.0 million to $125.0 million and cash G&A to be in the range of $14.5 million to $15.5 million (exclusive of transaction costs and severance payments).
The Company's 2025 guidance is based on a number of assumptions that are subject to change and many of which are outside the Company's control. If actual results vary from these assumptions, the Company's expectations may change. There can be no assurance that the Company will achieve these results.
AFFO is a non-GAAP financial measure. The Company does not provide a reconciliation of such forward-looking non-GAAP measure to the most directly comparable financial measures calculated and presented in accordance with GAAP because to do so would be potentially misleading and not practical given the difficulty of projecting event driven transactional and other non-core operating items in any future period. The magnitude of these items, however, may be significant.
EARNINGS CONFERENCE CALL
A conference call will be held on Tuesday, February 25, 2025 at 11:00 AM ET. During the conference call the Company’s officers will review fourth quarter and full year 2024 performance, discuss recent events, and conduct a question and answer period.
The webcast will be accessible on the “Investor Relations” section of the Company’s website at www.NETSTREIT.com. To listen to the live webcast, please go to the site at least 15 minutes prior to the scheduled start time to register, as well as download and install any necessary audio software.
The conference call can also be accessed by dialing 1-877-451-6152 for domestic callers or 1-201-389-0879 for international callers. A dial-in replay will be available starting shortly after the call until March 4, 2025, which can be accessed by dialing 1-844-512-2921 for domestic callers or 1-412-317-6671 for international callers. The passcode for this dial-in replay is 13751303.
SUPPLEMENTAL PACKAGE
The Company’s supplemental package will be available prior to the conference call in the Investor Relations section of the Company’s website at www.investors.netstreit.com.
About NETSTREIT Corp.
NETSTREIT Corp. is an internally managed real estate investment trust (REIT) based in Dallas, Texas that specializes in acquiring single-tenant net lease retail properties nationwide. The growing portfolio consists of high-quality properties leased to e-commerce resistant tenants with healthy balance sheets. Led by a management team of seasoned commercial real estate executives, NETSTREIT’s strategy is to create the highest quality net lease retail portfolio in the country with the goal of generating consistent cash flows and dividends for its investors.
Investor Relations
ir@netstreit.com
972-597-4825
NON-GAAP FINANCIAL MEASURES
This press release contains non-GAAP financial measures, including FFO, Core FFO, AFFO, EBITDA, EBITDAre, Adjusted EBITDAre, Annualized Adjusted EBITDAre, Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI Estimated Run Rate, Total Property-Level Cash NOI Estimated Run Rate, Net Debt and Adjusted Net Debt. A reconciliation of each non-GAAP financial measure to the most comparable GAAP measure, and definitions of each non-GAAP measure, are included below.
FORWARD LOOKING STATEMENTS
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, without limitation, statements concerning our business and growth strategies, investment, financing and leasing activities, including estimated development costs, trends in our business, including trends in the market for single-tenant, retail commercial real estate. Words such as “expects,” “anticipates,” “intends,” “plans,” “likely,” “will,” “believes,” “seeks,” “estimates,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from the results of operations or plans expressed or implied by such forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore such statements included in this press release may not prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the results or conditions described in such statements or our objectives and plans will be achieved. For a further discussion of these and other factors that could impact future results, performance or transactions, see the information under the heading “Risk Factors” in our Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on February 14, 2024 and other reports filed with the SEC from time to time. Forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this press release. New risks and uncertainties may arise over time and it is not possible for us to predict those events or how they may affect us. Many of the risks identified herein and in our periodic reports have been and will continue to be heightened as a result of the ongoing and numerous adverse effects arising from macroeconomic conditions, including inflation, interest rates and instability in the banking system. We expressly disclaim any obligation or undertaking to update or revise any forward-looking statement contained herein, to reflect any change in our expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except to the extent otherwise required by law.
NETSTREIT CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
(Unaudited)
| | | | | | | | | | | |
| December 31, |
| 2024 | | 2023 |
| Assets | | | |
| Real estate, at cost: | | | |
| Land | $ | 571,272 | | | $ | 460,896 | |
| Buildings and improvements | 1,400,393 | | | 1,149,809 | |
| Total real estate, at cost | 1,971,665 | | | 1,610,705 | |
| Less accumulated depreciation | (143,422) | | | (101,210) | |
| Property under development | 6,118 | | | 29,198 | |
| Real estate held for investment, net | 1,834,361 | | | 1,538,693 | |
| Assets held for sale | 48,637 | | | 52,451 | |
| Mortgage loans receivable, net | 139,409 | | | 114,472 | |
| Cash, cash equivalents, and restricted cash | 14,320 | | | 29,929 | |
| Lease intangible assets, net | 164,392 | | | 161,354 | |
| Other assets, net | 58,227 | | | 49,337 | |
| Total assets | $ | 2,259,346 | | | $ | 1,946,236 | |
| Liabilities and equity | | | |
| Liabilities: | | | |
| Term loans, net | $ | 622,608 | | | $ | 521,912 | |
| Revolving credit facility | 239,000 | | | 80,000 | |
| Mortgage note payable, net | 7,853 | | | 7,883 | |
| Lease intangible liabilities, net | 20,177 | | | 25,353 | |
| Liabilities related to assets held for sale | 1,912 | | | 1,158 | |
| Accounts payable, accrued expenses, and other liabilities | 29,664 | | | 36,498 | |
| Total liabilities | 921,214 | | | 672,804 | |
Commitments and contingencies | | | |
| Equity: | | | |
| Stockholders’ equity | | | |
| Common stock, $0.01 par value, 400,000,000 shares authorized; 81,602,232 and 73,207,080 shares issued and outstanding as of December 31, 2024 and 2023, respectively | 816 | | | 732 | |
| Additional paid-in capital | 1,507,995 | | | 1,367,505 | |
| Distributions in excess of retained earnings | (188,046) | | | (112,276) | |
| Accumulated other comprehensive income | 10,206 | | | 8,943 | |
| Total stockholders’ equity | 1,330,971 | | | 1,264,904 | |
| Noncontrolling interests | 7,161 | | | 8,528 | |
| Total equity | 1,338,132 | | | 1,273,432 | |
| Total liabilities and equity | $ | 2,259,346 | | | $ | 1,946,236 | |
NETSTREIT CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)
| | | | | | | | | | | | | | | | | | | |
| Year Ended December 31, |
| 2024 | | | 2023 | | | 2022 |
| Revenues | | | | | | | |
| Rental revenue (including reimbursable) | $ | 150,823 | | | | $ | 123,967 | | | | $ | 93,934 | |
| Interest income on loans receivable | 11,561 | | | | 7,388 | | | | 2,345 | |
| Other revenue | 400 | | | | 550 | | | | — | |
| Total revenues | 162,784 | | | | 131,905 | | | | 96,279 | |
| Operating expenses | | | | | | | |
| Property | 17,422 | | | | 16,413 | | | | 11,695 | |
| General and administrative | 19,722 | | | | 20,176 | | | | 19,053 | |
| Depreciation and amortization | 76,871 | | | | 63,677 | | | | 50,075 | |
| Provisions for impairment | 29,969 | | | | 7,083 | | | | 1,114 | |
| Transaction costs | 359 | | | | 456 | | | | 839 | |
| Total operating expenses | 144,343 | | | | 107,805 | | | | 82,776 | |
| Other (expense) income | | | | | | | |
| Interest expense, net | (30,324) | | | | (19,058) | | | | (9,181) | |
| Gain on sales of real estate, net | 1,876 | | | | 1,175 | | | | 4,148 | |
| Loss on debt extinguishment | — | | | | (128) | | | | — | |
| Other (expense) income, net | (1,944) | | | | 752 | | | | 131 | |
| Total other expense, net | (30,392) | | | | (17,259) | | | | (4,902) | |
| Net (loss) income before income taxes | (11,951) | | | | 6,841 | | | | 8,601 | |
| Income tax (expense) benefit | (49) | | | | 49 | | | | (396) | |
| Net (loss) income | (12,000) | | | | 6,890 | | | | 8,205 | |
| Net (loss) income attributable to noncontrolling interests | (63) | | | | 53 | | | | 88 | |
| Net (loss) income attributable to common stockholders | $ | (11,937) | | | | $ | 6,837 | | | | $ | 8,117 | |
| Amounts available to common stockholders per common share: | | | | | | | |
| Basic | $ | (0.16) | | | | $ | 0.11 | | | | $ | 0.16 | |
| Diluted | $ | (0.16) | | | | $ | 0.11 | | | | $ | 0.16 | |
| Weighted average common shares: | | | | | | | |
| Basic | 76,517,767 | | | | 63,922,973 | | | | 49,517,977 | |
| Diluted | 76,517,767 | | | | 64,665,439 | | | | 50,431,822 | |
NETSTREIT CORP. AND SUBSIDIARIES
RECONCILIATION OF NET (LOSS) INCOME TO FFO, CORE FFO AND ADJUSTED FFO
(In thousands, except share and per share data)
(Unaudited)
| | | | | | | | | | | |
| Year Ended December 31, |
| 2024 | | 2023 |
| Net (loss) income | $ | (12,000) | | | $ | 6,890 | |
| Depreciation and amortization of real estate | 76,560 | | | 63,379 | |
| Provisions for impairment | 29,969 | | | 7,083 | |
| Gain on sales of real estate, net | (1,876) | | | (1,175) | |
| FFO | 92,653 | | | 76,177 | |
| Adjustments: | | | |
| Non-recurring executive transition costs, severance and related charges | 1,643 | | | 362 | |
| Loss on debt extinguishment and other related costs | — | | | 223 | |
| Other non-recurring loss (gain), net | 2,934 | | | (78) | |
| Core FFO | 97,230 | | | 76,684 | |
| Adjustments: | | | |
| Straight-line rent adjustments | (2,949) | | | (1,163) | |
| Amortization of deferred financing costs | 2,230 | | | 1,730 | |
| Amortization of above/below-market assumed debt | 114 | | | 114 | |
| Amortization of loan origination costs and discounts | (365) | | | 163 | |
| Amortization of lease-related intangibles | (458) | | | (611) | |
| Earned development interest | 1,072 | | | 515 | |
| Capitalized interest expense | (806) | | | (1,060) | |
| Non-cash interest expense | (3,789) | | | (2,124) | |
| Non-cash compensation expense | 5,126 | | | 4,822 | |
| AFFO | $ | 97,405 | | | $ | 79,070 | |
| | | |
| Weighted average common shares outstanding, basic | 76,517,767 | | | 63,922,973 | |
| Weighted average operating partnership units outstanding | 444,435 | | | 501,751 | |
| Weighted average dilutive securities | 123,992 | | | 165,420 | |
| Weighted average unsettled shares under forwards | 233,606 | | | 75,295 | |
| Weighted average common shares outstanding, diluted | 77,319,800 | | | 64,665,439 | |
| | | |
| FFO per common share, diluted | $ | 1.20 | | | $ | 1.18 | |
| Core FFO per common share, diluted | $ | 1.26 | | | $ | 1.19 | |
| AFFO per common share, diluted | $ | 1.26 | | | $ | 1.22 | |
NETSTREIT CORP. AND SUBSIDIARIES
RECONCILIATION OF NET (LOSS) INCOME TO EBITDA, EBITDAre AND ADJUSTED EBITDAre
(In thousands)
(Unaudited)
| | | | | | | | | | | |
| Three Months Ended December 31, |
| 2024 | | 2023 |
| Net (loss) income | $ | (5,424) | | | $ | 1,962 | |
| Depreciation and amortization of real estate | 20,275 | | | 17,000 | |
| Amortization of lease-related intangibles | (95) | | | (93) | |
| Non-real estate depreciation and amortization | 75 | | | 78 | |
| Interest expense, net | 8,576 | | | 5,646 | |
| Income tax expense | 18 | | | 10 | |
| Amortization of loan origination costs and discounts | (123) | | | 80 | |
| EBITDA | 23,302 | | | 24,683 | |
| Adjustments: | | | |
| Provisions for impairment | 12,633 | | | 2,709 | |
| Gain on sales of real estate, net | (1,002) | | | (506) | |
EBITDAre | 34,933 | | | 26,886 | |
| Adjustments: | | | |
| Straight-line rent adjustments | (1,120) | | | (456) | |
| Non-recurring executive transition costs, severance and related charges | 148 | | | 86 | |
Other non-recurring gain, net | (142) | | | (31) | |
| Other non-recurring expenses, net | 438 | | | — | |
Transaction costs | 158 | | | 189 | |
| Non-cash compensation expense | 999 | | | 1,264 | |
| Lease termination fees | (400) | | | — | |
Adjustment for construction in process (1) | 152 | | | 719 | |
Adjustment for intraquarter investment activities (2) | 1,910 | | | 820 | |
Adjusted EBITDAre | $ | 37,076 | | | $ | 29,477 | |
Annualized Adjusted EBITDAre(3) | $ | 148,304 | | | |
| | | |
Net Debt | As of December 31, 2024 | | |
| Principal amount of total debt | $ | 872,205 | | | |
| Less: Cash, cash equivalents and restricted cash | (14,320) | | | |
| Net Debt | 857,885 | | | |
Less: Net value of unsettled forward equity(4) | (185,063) | | | |
| Adjusted Net Debt | $ | 672,822 | | | |
| | | |
Leverage | | | |
| Net Debt / Annualized Adjusted EBITDAre | 5.8 | x | | |
| Adjusted Net Debt / Annualized Adjusted EBITDAre | 4.5 | x | | |
1.Adjustment reflects the estimated cash yield on developments in process as of December 31, 2024.
2.Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended December 31, 2024, had occurred on October 1, 2024.
3.We calculate Annualized Adjusted EBITDAre by multiplying Adjusted EBITDAre by four.
4.Reflects 10,735,647 of unsettled forward equity shares at the December 31, 2024, available weighted average net settlement price of $17.24 per share.
NETSTREIT CORP. AND SUBSIDIARIES
RECONCILIATION OF NET (LOSS) INCOME TO NOI AND CASH NOI
(in thousands)
(Unaudited)
| | | | | | | | | | | |
| Three Months Ended December 31, |
| 2024 | | 2023 |
Net (loss) income | $ | (5,424) | | | $ | 1,962 | |
| General and administrative | 4,456 | | | 4,876 | |
| Depreciation and amortization | 20,349 | | | 17,078 | |
| Provisions for impairment | 12,633 | | | 2,709 | |
| Transaction costs | 158 | | | 189 | |
| Interest expense, net | 8,576 | | | 5,646 | |
| Gain on sales of real estate, net | (1,002) | | | (506) | |
| Income tax expense | 18 | | | 10 | |
| Amortization of loan origination costs and discounts | (123) | | | 80 | |
| Interest income on mortgage loans receivable | (3,103) | | | (2,243) | |
| Lease termination fees | (400) | | | — | |
| Other expense, net | 103 | | | (166) | |
| Property-Level NOI | 36,241 | | | 29,635 | |
| Straight-line rent adjustments | (1,120) | | | (456) | |
| Amortization of lease-related intangibles | (95) | | | (93) | |
| Property-Level Cash NOI | $ | 35,026 | | | $ | 29,086 | |
| Adjustment for intraquarter acquisitions, dispositions, and completed development (1) | 1,817 | | | |
| Property-Level Cash NOI Estimated Run Rate | 36,843 | | | |
| Interest income on mortgage loans receivable | 3,103 | | | |
| Adjustments for intraquarter mortgage loan activity (2) | 93 | | |
| Total Cash NOI - Estimated Run Rate | $ | 40,039 | | | |
1.Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended December 31, 2024, had occurred on October 1, 2024.
2.Adjustment assumes all loan activity completed during the three months ended December 31, 2024, had occurred on October 1, 2024.
NON-GAAP FINANCIAL MEASURES
FFO, Core FFO, and AFFO
The National Association of Real Estate Investment Trusts ("NAREIT"), an industry trade group, has promulgated a widely accepted non-GAAP financial measure of operating performance known as FFO. Our FFO is net (loss) income in accordance with GAAP, excluding gains (or losses) resulting from dispositions of properties, plus depreciation and amortization and impairment charges on depreciable real property.
Core FFO is a non-GAAP financial measure defined as FFO adjusted to remove the effect of unusual and non-recurring items that are not expected to impact our operating performance or operations on an ongoing basis. These include non-recurring executive transition costs, severance and related charges, non-recurring other loss (gain), net, and loss on debt extinguishments and other related costs.
AFFO is a non-GAAP financial measure defined as Core FFO adjusted for GAAP net (loss) income related to non-cash revenues and expenses, such as straight-line rent, amortization of above- and below-market lease-related intangibles, amortization of lease incentives, capitalized interest expense, earned development interest, non-cash interest expense, non-cash compensation expense, amortization of deferred financing costs, amortization of above/below-market assumed debt, and amortization of loan origination costs.
Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. In fact, real estate values historically have risen or fallen with market conditions. FFO is intended to be a standard supplemental measure of operating performance that excludes historical cost depreciation and valuation adjustments from net (loss) income. We consider FFO to be useful in evaluating potential property acquisitions and measuring operating performance.
We further consider FFO, Core FFO and AFFO to be useful in determining funds available for payment of distributions. FFO, Core FFO and AFFO do not represent net (loss) income or cash flows from operations as defined by GAAP. You should not consider FFO, Core FFO and AFFO to be alternatives to net (loss) income as a reliable measure of our operating performance nor should you consider FFO, Core FFO and AFFO to be alternatives to cash flows from operating, investing or financing activities (as defined by GAAP) as measures of liquidity.
FFO, Core FFO and AFFO do not measure whether cash flow is sufficient to fund our cash needs, including principal amortization, capital improvements and distributions to stockholders. FFO, Core FFO and AFFO do not represent cash flows from operating, investing or financing activities as defined by GAAP. Further, FFO, Core FFO and AFFO as disclosed by other REITs might not be comparable to our calculations of FFO, Core FFO and AFFO.
EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre
We compute EBITDA as earnings before interest expense, income tax expense, and depreciation and amortization. In 2017, NAREIT issued a white paper recommending that companies that report EBITDA also report EBITDAre. We compute EBITDAre in accordance with the definition adopted by NAREIT. NAREIT defines EBITDAre as EBITDA (as defined above) excluding gains (or losses) from the sales of depreciable property and impairment charges on depreciable real property.
Adjusted EBITDAre is a non-GAAP financial measure defined as EBITDAre further adjusted to exclude straight-line rent, non-cash compensation expense, non-recurring executive transition costs, severance and related charges, loss on debt extinguishment and other related costs, other non-recurring loss (gain), net, other non-recurring expenses (income), transaction costs, lease termination fees, adjustment for construction in process, and adjustment for intraquarter activities.
Annualized Adjusted EBITDAre is Adjusted EBITDAre multiplied by four.
We present EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre as they are measures commonly used in our industry. We believe that these measures are useful to investors and analysts because they provide supplemental information concerning our operating performance, exclusive of certain non-cash items and other costs. We use EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre as measures of our operating performance and not as measures of liquidity.
EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre do not include all items of revenue and expense included in net income, they do not represent cash generated from operating activities and they are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operations as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures. Additionally, our computation of EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre may differ from the methodology for calculating these metrics used by other equity REITs and, therefore, may not be comparable to similarly titled measures reported by other equity REITs.
Net Debt and Adjusted Net Debt
We calculate our Net Debt as our principal amount of total debt outstanding excluding deferred financing costs, net discounts and debt issuance costs less cash, cash equivalents and restricted cash available for future investment. We believe excluding cash, cash equivalents and restricted cash available for future investment from our principal amount, all of which could be used to repay debt, provides an estimate on the net contractual amount of borrowed capital to be repaid. We believe these adjustments are additional beneficial disclosures to investors and analysts.
We further adjust Net Debt by the net value of unsettled forward equity as of period end to derive Adjusted Net Debt.
Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate
Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate are non-GAAP financial measures which we use to assess our operating results. We compute Property-Level NOI as net (loss) income (computed in accordance with GAAP), excluding general and administrative expenses, interest expense (or income), income tax expense, amortization of loan origination costs and discounts, transaction costs, depreciation and amortization, gains (or losses) on sales of depreciable property, real estate impairment losses, interest income on mortgage loans receivable, loss on debt extinguishment, lease termination fees, and other expense (income), net. We further adjust Property-Level NOI for non-cash revenue components of straight-line rent and amortization of lease-intangibles to derive Property-Level Cash NOI. We further adjust Property-Level Cash NOI for intraquarter acquisitions, dispositions and completed developments to derive Property-Level Cash NOI - Estimated Run Rate. We further adjust Property-Level Cash NOI - Estimated Run Rate for interest income on mortgage loans receivable and intraquarter mortgage loan activity to derive Total Cash NOI - Estimated Run Rate. We believe Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate provide useful and relevant information because they reflect only those income and expense items that are incurred at the property level and present such items on an unlevered basis.
Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate are not measurements of financial performance under GAAP, and may not be comparable to similarly titled measures of other companies. You should not consider our measures as alternatives to net (loss) income or cash flows from operating activities determined in accordance with GAAP.
OTHER DEFINITIONS
ABR is annualized base rent as of December 31, 2024, for all leases that commenced and annualized cash interest on mortgage loans receivable in place as of that date.
Cash Yield is the annualized base rent contractually due from acquired properties and completed developments, and interest income from mortgage loans receivable, divided by the gross investment amount, gross proceeds in the case of dispositions, or loan repayment amount.
Investments are lease agreements in place at owned properties, properties that have leases associated with mortgage loans receivable, developments where rent commenced, interest earning developments, or in the case of master lease arrangements each property under the master lease is counted as a separate lease.
Investment Grade are investments, or investments that are subsidiaries of a parent entity, with a credit rating of BBB- (S&P/Fitch), Baa3 (Moody's) or NAIC2 (National Association or Insurance Commissioners) or higher.
Investment Grade Profile are investments with investment grade credit metrics (more than $1.0 billion in annual sales and a debt to adjusted EBITDA ratio of less than 2.0x), but do not carry a published rating from S&P, Fitch, Moody's, or NAIC.
Occupancy is expressed as a percentage, and is the number of leased investments divided by the total number of investments owned, excluding properties under development.
Weighted Average Lease Term is weighted by the annualized base rent, excluding lease extension options and investments associated with mortgage loans receivable.
Fourth Quarter and Full Year 2024 Supplemental Financial Information
Table of Contents 2 03 Corporate Overview 04 Quarterly Highlights 05 Consolidated Statements of Operations 06 Funds from Operations and Adjusted Funds from Operations 07 EBITDAre and Adjusted EBITDAre 08 Net Operating Income 09 Consolidated Balance Sheets 10 Debt, Capitalization, and Financial Ratios 12 Investment Activity 13 Portfolio Information 17 Lease Expiration Schedule 18 Non-GAAP Measures and Definitions 22 Forward-Looking and Cautionary Statements
Management Team Mark Manheimer Chief Executive Officer and President Daniel Donlan Chief Financial Officer and Treasurer Sofia Chernylo Senior Vice President, Chief Accounting Officer Jeff Fuge Senior Vice President of Acquisitions Chad Shafer Senior Vice President of Real Estate and Underwriting 3 Corporate Overview Corporate Profile NETSTREIT Corp. (NYSE: NTST) is an internally managed real estate investment trust (REIT) based in Dallas, Texas that specializes in acquiring single-tenant net lease retail properties nationwide. The growing portfolio consists of high-quality properties leased to e- commerce resistant tenants with healthy balance sheets. Led by a management team of seasoned commercial real estate executives, NETSTREIT’s strategy is to create the highest quality net lease retail portfolio in the country in order to generate consistent cash flows and dividends for its investors. Board of Directors Lori Wittman - Chair Michael Christodolou Heidi Everett Mark Manheimer Todd Minnis Matthew Troxell Robin Zeigler Corporate Headquarters 2021 McKinney Avenue Suite 1150 Dallas, Texas, 75201 Phone: (972) 597 - 4825 Website: www.netstreit.com Transfer Agent Computershare PO Box 43007 Providence, RI 09240-3007 Phone: (800) 736 - 3001 Website: www.computershare.com
Quarterly Highlights (unaudited, dollars in thousands, except per share data) 4 Three Months Ended Financial Results December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023 Net (loss) income $ (5,424) $ (5,322) $ (2,306) $ 1,045 $ 1,962 Net (loss) income per common share outstanding - diluted $ (0.07) $ (0.07) $ (0.03) $ 0.01 $ 0.03 Funds from Operations (FFO) $ 26,482 $ 25,008 $ 19,987 $ 21,179 $ 21,165 FFO per common share outstanding - diluted $ 0.32 $ 0.32 $ 0.27 $ 0.28 $ 0.30 Core Funds from Operations (Core FFO) $ 26,488 $ 24,907 $ 23,389 $ 22,450 $ 21,220 Core FFO per common share outstanding - diluted $ 0.32 $ 0.32 $ 0.31 $ 0.30 $ 0.30 Adjusted Funds from Operations (AFFO) $ 25,908 $ 24,825 $ 23,817 $ 22,863 $ 21,573 AFFO per common share outstanding - diluted $ 0.32 $ 0.32 $ 0.32 $ 0.31 $ 0.31 Dividends per share $ 0.210 $ 0.210 $ 0.205 $ 0.205 $ 0.205 Weighted average common shares outstanding - diluted 82,153,404 77,610,680 73,588,605 74,565,790 69,922,646 Portfolio Metrics Number of investments(1) 687 671 649 628 598 Square feet 12,609,612 12,076,093 11,701,160 11,322,746 10,624,183 Occupancy(2) 99.9 % 100.0 % 100.0 % 100.0 % 100.0 % Weighted average lease term remaining (years)(3) 9.8 9.5 9.5 9.2 9.2 Investment grade (rated) - % of ABR(4) 55.8 % 60.9 % 68.9 % 71.1 % 70.5 % Investment grade profile (unrated) - % of ABR(5) 15.0 % 14.4 % 13.7 % 13.3 % 14.1 % Combined Investment grade (rated) & Investment grade profile (unrated) - % of ABR 70.8 % 75.3 % 82.6 % 84.4 % 84.6 % 1. Includes acquisitions, mortgage loans receivable, and completed developments. 2. Calculation excludes properties under development and one vacant property. 3. Weighted by ABR; excludes lease extension options and investments that secure mortgage loans receivable. 4. Investments, or investments that are subsidiaries of a parent entity, with a credit rating of BBB- (S&P/Fitch), Baa3 (Moody's), or NAIC2 (National Association of Insurance Commissioners) or higher. 5. Investments with investment grade credit metrics (more than $1.0 billion in annual sales and a debt to adjusted EBITDA ratio of less than 2.0x), but do not carry a published rating from S&P, Fitch, Moody's, or NAIC. $0.94 $1.16 $1.22 $1.26 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $0.70 $0.80 $0.90 $1.00 $1.10 $1.20 $1.30 $1.40 $1.50 2021 2022 2023 2024 G ro ss R ea l E st a te V a lu e ($ i n m il li o n s) A F F O /s h Historical AFFO/sh and Asset Growth AFFO/sh Gross Real Estate Value AFFO/sh Growth CAGR 10.3%
5 Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 REVENUES Rental revenue (including reimbursable) $ 40,598 $ 34,619 $ 150,823 $ 123,967 Interest income on loans receivable 3,103 2,243 11,561 7,388 Other revenue 400 — 400 550.00 Total revenues 44,101 36,862 162,784 131,905 OPERATING EXPENSES Property 4,845 5,064 17,422 16,413 General and administrative 4,456 4,876 19,722 20,176 Depreciation and amortization 20,349 17,078 76,871 63,677 Provisions for impairment 12,633 2,709 29,969 7,083 Transaction costs 158 189 359 456 Total operating expenses 42,441 29,916 144,343 107,805 OTHER INCOME (EXPENSE) Interest expense, net (8,576) (5,646) (30,324) (19,058) Gain on sales of real estate, net 1,002 506 1,876 1,175 Loss on debt extinguishment — — — (128) Other (expense) income, net 508 166 (1,944) 752 Total other expense, net (7,066) (4,974) (30,392) (17,259) Net (loss) income before income taxes (5,406) 1,972 (11,951) 6,841 Income tax (expense) benefit (18) (10) (49) 49 Net (loss) income (5,424) 1,962 (12,000) 6,890 Net (loss) income attributable to noncontrolling interests (28) 21 (63) 53 Net (loss) income attributable to common stockholders $ (5,396) $ 1,941 $ (11,937) $ 6,837 Amounts available to common stockholders per common share: Basic $ (0.07) $ 0.03 $ (0.16) $ 0.11 Diluted $ (0.07) $ 0.03 $ (0.16) $ 0.11 Weighted average common shares: Basic 81,585,762 69,276,514 76,517,767 63,922,973 Diluted 81,585,762 69,922,646 76,517,767 64,665,439 Consolidated Statements of Operations (unaudited, dollars in thousands, except per share data)
Funds From Operations and Adjusted Funds From Operations (unaudited, dollars in thousands, except per share data) 6 Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 GAAP Reconciliation: Net (loss) income $ (5,424) $ 1,962 $ (12,000) $ 6,890 Depreciation and amortization of real estate 20,275 17,000 76,560 63,379 Provisions for impairment 12,633 2,709 29,969 7,083 Gain on sales of real estate, net (1,002) (506) (1,876) (1,175) Funds from Operations (FFO) $ 26,482 $ 21,165 $ 92,653 $ 76,177 Non-recurring executive transition costs, severance and related charges 148 86 1,643 362 Loss on debt extinguishment and other related costs — — — 223 Other non-recurring loss (gain), net (142) (31) 2,934 (78) Core Funds from Operations (Core FFO) $ 26,488 $ 21,220 $ 97,230 $ 76,684 Straight-line rent adjustments (1,120) (456) (2,949) (1,163) Amortization of deferred financing costs 558 565 2,230 1,730 Amortization of above/below-market assumed debt 29 29 114 114 Amortization of loan origination costs and discounts (123) 80 (365) 163 Amortization of lease-related intangibles (95) (93) (458) (611) Earned development interest 110 326 1,072 515 Capitalized interest expense (97) (372) (806) (1,060) Non-cash interest expense (841) (990) (3,789) (2,124) Non-cash compensation expense 999 1,264 5,126 4,822 Adjusted Funds from Operations (AFFO) $ 25,908 $ 21,573 $ 97,405 $ 79,070 FFO per common share, diluted $ 0.32 $ 0.30 $ 1.20 $ 1.18 Core FFO per common share, diluted $ 0.32 $ 0.30 $ 1.26 $ 1.19 AFFO per common share, diluted $ 0.32 $ 0.31 $ 1.26 $ 1.22 Dividends per share $ 0.210 $ 0.205 $ 0.830 $ 0.810 Dividends per share as a percent of AFFO 66 % 66 % 66 % 66 % Weighted average common shares outstanding, basic 81,585,762 69,276,514 76,517,767 63,922,973 Operating partnership units outstanding 424,956 486,096 444,435 501,751 Unvested restricted stock units 142,686 160,036 123,992 165,420 Unsettled shares under open forward equity contracts — — 233,606 75,295 Weighted average common shares outstanding, diluted 82,153,404 69,922,646 77,319,800 64,665,439
EBITDAre and Adjusted EBITDAre (unaudited, dollars in thousands) 7 Three Months Ended December 31, 2024 2023 GAAP Reconciliation: Net (loss) income $ (5,424) $ 1,962 Depreciation and amortization of real estate 20,275 17,000 Amortization of lease-related intangibles (95) (93) Non-real estate depreciation and amortization 75 78 Interest expense, net 8,576 5,646 Income tax expense 18 10 Amortization of loan origination costs and discounts (123) 80 EBITDA 23,302 24,683 Adjustments: Provisions for impairment 12,633 2,709 Gain on sales of real estate, net (1,002) (506) EBITDAre 34,933 26,886 Adjustments: Straight-line rent adjustments (1,120) (456) Non-recurring executive transition costs, severance and related charges 148 86 Other non-recurring gain, net (142) (31) Other non-recurring expenses, net 438 — Transaction costs 158 189 Non-cash compensation expense 999 1,264 Lease termination fees (400) — Adjustment for construction in process(1) 152 719 Adjustment for intraquarter investment activities(2) 1,910 820 Adjusted EBITDAre $ 37,076 $ 29,477 Annualized Adjusted EBITDAre(3) $ 148,304 Net Debt As of December 31, 2024 Principal amount of total debt $ 872,205 Less: Cash, cash equivalents and restricted cash (14,320) Net Debt $ 857,885 Less: Net value of unsettled forward equity(4) (185,063) Adjusted Net Debt $ 672,822 Leverage Net Debt / Annualized Adjusted EBITDAre 5.8 x Adjusted Net Debt / Annualized Adjusted EBITDAre 4.5 x 1. Adjustment reflects the estimated cash yield on developments in process as of December 31, 2024. 2. Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended December 31, 2024, had occurred on October 1, 2024. 3. We calculate Annualized Adjusted EBITDAre by multiplying Adjusted EBITDAre by four. 4. Reflects 10,735,647 of unsettled forward equity shares at the December 31, 2024, available weighted average net settlement price of $17.24 per share.
Net Operating Income (unaudited, dollars in thousands) 8 Three Months Ended December 31, 2024 2023 GAAP Reconciliation: Net (loss) income $ (5,424) $ 1,962 General and administrative 4,456 4,876 Depreciation and amortization 20,349 17,078 Provisions for impairment 12,633 2,709 Transaction costs 158 189 Interest expense, net 8,576 5,646 Gain on sales of real estate, net (1,002) (506) Income tax expense 18 10 Amortization of loan origination costs and discounts (123) 80 Interest income on mortgage loans receivable (3,103) (2,243) Lease termination fees (400) — Other expense, net 103 (166) Property-Level NOI 36,241 29,635 Straight-line rent adjustments (1,120) (456) Amortization of lease-related intangibles (95) (93) Property-Level Cash NOI $ 35,026 $ 29,086 Adjustment for intraquarter acquisitions, dispositions, and completed development(1) 1,817 Property-Level Cash NOI Estimated Run Rate $ 36,843 Interest income on mortgage loans receivable 3,103 Adjustments for intraquarter mortgage loan activity(2) 93 Total Cash NOI - Estimated Run Rate $ 40,039 Property Operating Expense Coverage Property operating expense reimbursement $ 4,092 $ 4,415 Property operating expenses (4,845) (5,064) Property operating expenses, net $ (752) $ (648) 1. Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended December 31, 2024, had occurred on October 1, 2024. 2. Adjustment assumes all loan activity completed during the three months ended December 31, 2024, had occurred on October 1, 2024.
Consolidated Balance Sheets (unaudited, dollars in thousands, except per share data) 9 December 31, 2024 2023 ASSETS Real estate, at cost: Land $ 571,272 $ 460,896 Buildings and improvements 1,400,393 1,149,809 Total real estate, at cost 1,971,665 1,610,705 Less accumulated depreciation (143,422) (101,210) Property under development 6,118 29,198 Real estate held for investment, net 1,834,361 1,538,693 Assets held for sale 48,637 52,451 Mortgage loans receivable, net 139,409 114,472 Cash, cash equivalents, and restricted cash 14,320 29,929 Lease intangible assets, net 164,392 161,354 Other assets, net 58,227 49,337 Total assets $ 2,259,346 $ 1,946,236 LIABILITIES AND EQUITY Liabilities: Term loans, net 622,608 521,912 Revolving credit facility 239,000 80,000 Mortgage note payable, net 7,853 7,883 Lease intangible liabilities, net 20,177 25,353 Liabilities related to assets held for sale 1,912 1,158 Accounts payable, accrued expenses, and other liabilities 29,664 36,498 Total liabilities $ 921,214 $ 672,804 Equity: Stockholders’ equity Common stock, $0.01 par value, 400,000,000 shares authorized; 81,602,232 and 73,207,080 shares issued and outstanding as of December 31, 2024 and 2023, respectively $ 816 $ 732 Additional paid-in capital 1,507,995 1,367,505 Distributions in excess of retained earnings (188,046) (112,276) Accumulated other comprehensive income 10,206 8,943 Total stockholders’ equity 1,330,971 1,264,904 Noncontrolling interests 7,161 8,528 Total equity 1,338,132 1,273,432 Total liabilities and equity $ 2,259,346 $ 1,946,236
1. Rates presented exclude the impact of capitalized loan fee amortization. Interest rates that consist of fixed rate SOFR swaps include a credit spread adjustment of 0.10% and a borrowing spread of 1.15%. 2. Interest rate reflects the all-in borrowing rate as of December 31, 2024. Facility fees are charged at an annual rate of 0.15% of the total facility size of $400 million, and are not included in the interest rate presented. The facility has a one-year extension option. Remaining capacity reduced by $0.15 million for outstanding letters of credit. 3. The term loan matures on July 3, 2026, and includes two one-year extension options and one six-month extension option. 4. The mortgage note was assumed as part of an asset acquisition during the third quarter of 2022. 5. The total facility size increased to $500 million and the maturity was extended to January 15, 2029, and includes a one-year extension option. 6. The term loan was amended to extend the maturity to January 15, 2029, and includes a one-year extension option. Existing fixed rate SOFR swap expires in January 2027; the term loan is unhedged beyond that date. 7. The term loan matures on January 15, 2029, and includes a one-year extension option. Debt, Capitalization, and Financial Ratios (unaudited, dollars in thousands) 10 As of December 31, 2024 Debt Summary Fully Extended Maturity Principal Balance Fixed Rate SOFR Swap Interest Rate(1) Remaining Capacity Available Term (years) Unsecured revolver(2) August 11, 2027 $ 239,000 —% 5.63% $ 160,850 2.6 Unsecured term loan January 15, 2027 175,000 2.40% 3.65% — 2.0 Unsecured term loan February 11, 2028 200,000 2.63% 3.88% — 3.1 Unsecured term loan(3) January 3, 2029 250,000 3.74% 4.99% — 4.0 Mortgage note(4) November 1, 2027 8,205 —% 4.53% — 2.8 Total / Weighted Average $ 872,205 3.01% 4.64% $ 160,850 3.0 Proforma as of December 31, 2024 Debt Summary Fully Extended Maturity Principal Balance Fixed Rate SOFR Swap Interest Rate(1) Remaining Capacity Available Term (years) Unsecured revolver(5) January 15, 2030 $ 64,000 —% 5.63% $ 435,850 5.0 Unsecured term loan February 11, 2028 200,000 2.63% 3.88% — 3.1 Unsecured term loan January 3, 2029 250,000 3.74% 4.99% — 4.0 Unsecured term loan A(6) January 15, 2030 175,000 2.40% 3.65% — 5.0 Unsecured term loan B(7) January 15, 2030 175,000 3.87% 5.12% — 5.0 Mortgage note November 1, 2027 8,205 —% 4.53% — 2.8 Total / Weighted Average $ 872,205 3.20% 4.53% $ 435,850 4.3 $175 $200 $250 $8 $400 $0 $200 $400 $600 $800 $1,000 2025 2026 2027 2028 2029 2030 $175 $175 $200 $500 $250 $8 $0 $200 $400 $600 $800 $1,000 2025 2026 2027 2028 2029 2030 Debt Maturity Schedule Proforma Debt Maturity Schedule Revolver Capacity Existing Term Loans Term Loan B Mortgage Note
1. Reflects 10,735,647 of unsettled shares under forward sale agreements at the December 31, 2024, weighted average net settlement price of $17.24 per share. 2. Assumes the increased facility size to $500.0 million and the $175.0 million repayment towards the revolver balance had occurred as of December 31, 2024. 3. Value is based on the December 31, 2024, closing share price of $14.15 per share. Debt, Capitalization, and Financial Ratios (unaudited, dollars in thousands, except per share data) 11 Net Debt December 31, 2024 Principal amount of total debt $ 872,205 Less: Cash, cash equivalents and restricted cash (14,320) Net Debt $ 857,885 Less: Net value of unsettled forward equity(1) (185,063) Adjusted Net Debt $ 672,822 Net Debt / Annualized Adjusted EBITDAre 5.8x Adjusted Net Debt / Annualized Adjusted EBITDAre 4.5x Key Debt Covenant Information Required Actual Consolidated total leverage ratio ≤ 60.0% 32.9% Fixed charge coverage ratio ≥ 1.50x 3.92x Maximum secured indebtedness ≤ 40.0% 0.3% Maximum recourse indebtedness ≤ 10.0% —% Unencumbered leverage ratio ≤ 60.0% 34.7% Unencumbered interest coverage ratio ≥ 1.75x 3.92x Proforma Liquidity As of December 31, 2024 Unused unsecured revolver capacity(2) $ 435,850 Cash, cash equivalents and restricted cash 14,320 Net value of unsettled forward equity(1) 185,063 Total Proforma Liquidity $ 635,233 Equity Ending Shares/ Units as of December 31, 2024 Equity Market Capitalization % of Total Common shares(3) 81,602,232 $ 1,154,672 99.5 % OP units(3) 424,956 6,013 0.5 % Total 82,027,188 $ 1,160,685 100.0 % Enterprise Value As of December 31, 2024 % of Total Principal amount of total debt $ 872,205 42.9 % Equity market capitalization(3) 1,160,685 57.1 % Total enterprise value $ 2,032,890 100.0 %
1. Includes acquisitions, mortgage loans receivable, and completed developments. 2. ABR divided by the Gross Investment. 3. Weighted by ABR; excludes lease extension options and investments that secure mortgage loans receivable. 4. Excludes transaction costs and principal payments from mortgage loans receivable. 5. ABR divided by Gross Proceeds; excludes vacant properties. 6. Includes payoff of outstanding mortgage loans receivable. Excludes amortization of existing mortgage loans receivable. 7. Effective interest rate of mortgage loans receivable. Investment Activity (unaudited, dollars in thousands) 12 Three Months Ended December 31, September 30, June 30, March 31, December 31, 2024 2024 2024 2024 2023 Investments Number of Investments(1) 52 33 28 42 57 Gross Investment $ 195,079 $ 151,555 $ 115,734 $ 129,207 $ 119,128 Cash Yield(2) 7.4 % 7.5 % 7.5 % 7.5 % 7.2 % Weighted Average Lease Term (years)(3) 14.0 12.5 16.7 11.5 10.9 Investment Grade and Investment Grade Profile % 51.2 % 52.4 % 39.1 % 84.8 % 98.7 % Dispositions Number of Investments 30 8 6 12 5 Number of Vacant Properties — — — — — Gross Proceeds(4) $ 59,337 $ 24,105 $ 12,707 $ 21,594 $ 14,513 Cash Yield(5) 7.1 % 7.3 % 6.8 % 6.8 % 7.1 % Loan Repayments Number of Loan Repayments(6) 6 4 1 — 1 Amount of Repayment $ 13,627 $ 8,857 $ 2,324 $ — $ 1,482 Cash Yield(7) 9.3 % 8.7 % 10.3 % — % 7.6 % Developments Industry Location Lease Term (years) Amount Funded to Date Actual/ Anticipated Rent Commencement Dollar Stores (multiple programs) Various (9 completed) 10 to 15 $ 17,929 Commenced 1Q'24 Farm Supplies Malakoff, TX 20 $ 6,345 Commenced 1Q'24 Dollar Stores (multiple programs) Various (5 completed) 15 $ 9,071 Commenced 2Q'24 Automotive Service (multiple locations) Various (1 completed) 10 to 15 $ 3,256 Commenced 2Q'24 Home Improvement Butte, MT 15 $ 10,601 Commenced 3Q'24 Dollar Stores (multiple programs) Various (2 completed) 15 $ 4,163 Commenced 3Q'24 Automotive Service (multiple locations) Various (1 completed) 15 $ 3,358 Commenced 3Q'24 Dollar Stores (multiple programs) Various (2 completed) 10 to 15 $ 4,245 Commenced 4Q'24 Automotive Service (multiple locations) Various (1 completed) 15 $ 3,103 Commenced 4Q'24 Dollar Stores (multiple programs) Various (1 in progress) 10 $ 932 1Q'25 to 2Q'25 Automotive Service (multiple locations) Various (3 in progress) 15 $ 5,098 1Q'25 to 2Q'25 Pet Supplies Sumter, SC 10 $ 1,853 1Q'25
Portfolio Information (unaudited, dollars in thousands) 13 1. Includes acquisitions, mortgage loans receivable, and completed developments. 2. Excludes investments that secure mortgage loans receivable and one vacant property. 3. Weighted by ABR; excludes lease extension options and investments that secure mortgage loans receivable. 4. Excludes one vacant property. 5. Investments, or investments that are subsidiaries of a parent entity (with such subsidiary making up at least 50% of the parent company total revenue), with a credit rating of BBB- (S&P), Baa3 (Moody's), or NAIC2 (National Association of Insurance Commissioners) or higher. 6. Investments with investment grade credit metrics (more than $1.0 billion in annual sales and a debt to adjusted EBITDA ratio of less than 2.0x), but do not carry a published rating from S&P, Moody's, or NAIC. 7. Investments, or investments that are subsidiaries of a parent entity (with such subsidiary making up at least 50% of the parent company total revenue), with a credit rating of BB+ (S&P), Ba1 (Moody's), or NAIC3 (National Association of Insurance Commissioners) or lower. Portfolio Metrics December 31, 2024 Number of Investments(1) 687 Number of states 45 Square feet 12,609,612 Tenants 98 Industries 26 Occupancy(2) 99.9 % Weighted average lease term remaining (years)(3) 9.8 Tenant Quality Number of Investments(4) ABR % of ABR Investment grade (rated)(5) 432 $ 92,172 55.8% Investment grade profile (unrated)(6) 70 24,774 15.0% Sub-investment grade (rated)(7) 104 29,107 17.6% Sub-investment grade profile (unrated) 80 19,017 11.5% Total 686 $ 165,070 100.0% Investment grade, 55.8% Investment grade profile, 15.0% Sub- investment grade, 17.6% Sub- investment grade profile, 11.5% 70.8% of ABR Inv. Grade Inv. Grade Profile Tenant Quality Necessity, 47.6% Discount, 18.8% Service, 21.1% Other, 12.5% 87.5% of ABR Necessity Discount Service Defensive Category
Portfolio Information (cont’d) (unaudited, dollars in thousands) 14 1. Includes acquisitions, mortgage loans receivable, and completed developments. 2. If rated by a credit rating agency, reflects highest rating from S&P, Fitch, Moody's, or National Association of Insurance Commissioners. 3. Loans receivable on properties leased to Dollar General represent 1.2% of ABR. 4. Stats incorporate all completed activities as of February 24, 2025, as if they occurred by December 31, 2024; all other portfolio stats are as of December 31, 2024. 5. Dollar Tree banners, as a percentage of ABR: Dollar Tree - 1.2%; Dollar Tree / Family Dollar Combo - 2.8%; Family Dollar – 0.9%. Top Tenants Number of Investments(1) % of ABR Credit rating(2) 119 8.6% BBB 33 6.2% BBB 5 5.0% A 71 4.9% BBB 17 4.2% IG Profile 8 3.9% BBB+ 21 3.8% BB 7 3.0% AA 17 2.8% Baa1 49 2.6% A 18 2.5% A 2 2.5% B+ 7 2.4% A3 7 2.4% IG Profile 3 2.3% IG Profile 37 2.2% Ba1 4 2.2% BBB+ 7 2.1% Baa1 Sub-Total 445 65.0% (4) (3)(4) (4)(5)
Portfolio Information (cont’d) (unaudited, dollars in thousands) 15 State Number of Investments(1) % of ABR Texas 70 12.3% Illinois 43 10.1% New York 36 7.4% Georgia 36 6.2% Wisconsin 23 5.7% North Carolina 72 5.0% Alabama 50 4.6% Ohio 42 4.0% Pennsylvania 30 3.9% Virginia 11 3.6% Other 273 37.2% Total 686 100.0% 1. Includes acquisitions, mortgage loans receivable, and completed developments, but excludes one vacant property. ≥ 5% ABR ≥ 5% and <3% ABR ≥ 3% and <5% ABR < 1% ABR 0% ABR
Portfolio Information (cont’d) (unaudited, dollars in thousands) 16 Industry Defensive Category Number of Investments(1) % of ABR Grocery Necessity 35 13.6% Dollar Stores(2) Discount 190 13.5% Home Improvement Necessity 30 11.2% Drug Stores & Pharmacies(2) Necessity 54 10.0% Convenience Stores Service 98 9.4% Discount Retail Discount 30 4.5% Arts & Crafts Other 16 4.2% Automotive Service Service 42 3.7% Health and Fitness Service 4 3.7% Farm Supplies Necessity 19 3.6% Auto Parts Necessity 59 3.2% Sporting Goods Other 6 3.2% Quick Service Restaurants Service 33 3.2% General Retail Necessity 7 3.0% Consumer Electronics Other 7 2.4% Healthcare Necessity 14 2.0% Specialty Other 2 1.0% Apparel Other 5 0.7% Casual Dining Service 7 0.7% Furniture Stores Other 2 0.6% Equipment Rental and Leasing Service 5 0.4% Banking Necessity 3 0.3% Wholesale Warehouse Club Necessity 1 0.3% Telecommunications Other 2 0.2% Gift, Novelty, and Souvenir Shops Other 1 0.1% Home Furnishings Other 1 0.1% Total 686 100.0% Defensive Category Number of Investments(1) % of ABR Necessity 225 47.6% Discount 230 18.8% Service 189 21.1% Other 42 12.5% Total 686 100.0% 1. Includes acquisitions, mortgage loans receivable, and completed developments, but excludes one vacant property. 2. Stats incorporate all completed activities as of February 24, 2025; all other portfolio stats are as of December 31, 2024.
Lease Expiration Schedule (unaudited, dollars in thousands) 17 ABR Expiring Year of Number of ABR as a % of Expiration Investments Expiring(1) Expiring Total Portfolio 2025 4 $ 1,215 0.8% 2026 9 2,459 1.6% 2027 12 4,077 2.7% 2028 25 10,094 6.6% 2029 41 9,602 6.3% 2030 32 11,046 7.2% 2031 53 12,260 8.0% 2032 39 10,582 6.9% 2033 52 11,520 7.5% 2034 71 18,040 11.8% 2035 36 9,681 6.3% 2036 19 5,797 3.8% 2037 21 7,265 4.7% 2038 63 8,420 5.5% 2039 47 9,916 6.5% 2040 7 1,366 0.9% 2041 4 1,246 0.8% 2042 1 985 0.6% 2043 17 3,646 2.4% 2044 47 13,099 8.5% 2045 1 153 0.1% 2046 — — —% 2047 1 156 0.1% 2048 — — —% 2049 8 771 0.5% 2050 — — —% 2051 — — —% TOTAL 610 $ 153,394 100.0% 1. Excludes investments that secure mortgage loans receivable and one vacant property.
FFO, Core FFO, and AFFO FFO means funds from operations. It is a non-GAAP measure defined by NAREIT as net (loss) income (computed in accordance with GAAP), excluding gains (or losses) resulting from dispositions of properties, plus depreciation and amortization and impairment charges on depreciable real property. Core FFO means core funds from operations. Core FFO is a non-GAAP financial measure defined as FFO adjusted to remove the effect of unusual and non-recurring items that are not expected to impact our operating performance or operations on an ongoing basis. These include non-recurring executive transition costs, severance and related charges, non-recurring other loss (gain), net, and loss on debt extinguishments and other related costs. AFFO means adjusted funds from operations. AFFO is a non-GAAP financial measure defined as Core FFO adjusted for GAAP net (loss) income related to non-cash revenues and expenses, such as straight-line rent, amortization of above- and below-market lease-related intangibles, amortization of lease incentives, capitalized interest expense, earned development interest, non-cash interest expense, non-cash compensation expense, amortization of deferred financing costs, amortization of above/below-market assumed debt, and amortization of loan origination costs. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. In fact, real estate values historically have risen or fallen with market conditions. FFO is intended to be a standard supplemental measure of operating performance that excludes historical cost depreciation and valuation adjustments from net income. We consider FFO to be useful in evaluating potential property acquisitions and measuring operating performance. We further consider FFO, Core FFO and AFFO to be useful in determining funds available for payment of distributions. FFO, Core FFO and AFFO do not represent net (loss) income or cash flows from operations as defined by GAAP. You should not consider FFO, Core FFO and AFFO to be alternatives to net (loss) income as a reliable measure of our operating performance nor should you consider FFO, Core FFO and AFFO to be alternatives to cash flows from operating, investing or financing activities (as defined by GAAP) as measures of liquidity. FFO, Core FFO and AFFO do not measure whether cash flow is sufficient to fund our cash needs, including principal amortization, capital improvements and distributions to stockholders. FFO, Core FFO and AFFO do not represent cash flows from operating, investing or financing activities as defined by GAAP. Further, FFO, Core FFO and AFFO as disclosed by other REITs might not be comparable to our calculations of FFO, Core FFO and AFFO. Non-GAAP Measures and Definitions 18
EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre EBITDA is defined as earnings before interest expense, income tax expense, and depreciation and amortization. EBITDAre is the NAREIT definition of EBITDA (as defined above), but it is further adjusted to follow the definition included in a white paper issued in 2017 by NAREIT, which recommended that companies that report EBITDA also report EBITDAre. We compute EBITDAre in accordance with the definition adopted by NAREIT. NAREIT defines EBITDAre as EBITDA (as defined above) excluding gains (or losses) from sales of depreciable property and impairment charges on depreciable real property. Adjusted EBITDAre is a non-GAAP financial measure defined as EBITDAre adjusted to exclude straight- line rent, non-cash compensation expense, non-recurring executive transition costs, severance and related charges, loss on debt extinguishment and other related costs, other non-recurring loss (gain), net, other non- recurring expenses (income), transaction costs, lease termination fees, adjustment for construction in process, and adjustment for intraquarter activities. Annualized Adjusted EBITDAre is a non-GAAP financial measure defined as Adjusted EBITDAre multiplied by four. We present EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre as they are measures commonly used in our industry. We believe that these measures are useful to investors and analysts because they provide supplemental information concerning our operating performance, exclusive of certain non-cash items and other costs. We use EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre as measures of our operating performance and not as measures of liquidity. EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre do not include all items of revenue and expense included in net (loss) income, they do not represent cash generated from operating activities and they are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net (loss) income as a performance measure or cash flows from operations as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures. Additionally, our computation of EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre may differ from the methodology for calculating these metrics used by other equity REITs and, therefore, may not be comparable to similarly titled measures reported by other equity REITs. Net Debt and Adjusted Net Debt Net Debt is calculated as our principal amount of total debt outstanding excluding deferred financing costs, net discounts and debt issuance costs less cash, cash equivalents and restricted cash available for future investment. We believe excluding cash, cash equivalents and restricted cash available for future investment from our principal amount, all of which could be used to repay debt, provides an estimate of the net contractual amount of borrowed capital to be repaid. We believe these adjustments are additional beneficial disclosures to investors and analysts. Adjusted Net Debt is Net Debt adjusted by the net value of unsettled forward equity as of period end. Non-GAAP Measures and Definitions (cont’d) 19
Non-GAAP Measures and Definitions (cont’d) Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate are non-GAAP financial measures which we use to assess our operating results. We compute Property-Level NOI as net income (computed in accordance with GAAP), excluding general and administrative expenses, interest expense (or income), income tax expense, amortization of loan origination costs and discounts, transaction costs, depreciation and amortization, gains (or losses) on sales of depreciable property, real estate impairment losses, interest income on mortgage loans receivable, loss on debt extinguishment, lease termination fees, and other expense (income), net. We further adjust Property-Level NOI for non-cash revenue components of straight-line rent and amortization of lease-intangibles to derive Property-Level Cash NOI. We further adjust Property-Level Cash NOI for intraquarter acquisitions, dispositions and completed developments to derive Property-Level Cash NOI - Estimated Run Rate. We further adjust Property-Level Cash NOI - Estimated Run Rate for interest income on mortgage loans receivable and intraquarter mortgage loan activity to derive Total Cash NOI - Estimated Run Rate. We believe Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate provide useful and relevant information because they reflect only those income and expense items that are incurred at the property level and present such items on an unlevered basis. Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate are not measurements of financial performance under GAAP, and may not be comparable to similarly titled measures of other companies. You should not consider our measures as alternatives to net income or cash flows from operating activities determined in accordance with GAAP. Other Definitions ABR is annualized base rent as of December 31, 2024, for all leases that commenced and annualized cash interest on mortgage loans receivable in place as of that date. Cash Yield is the annualized base rent contractually due from acquired properties and completed developments, and interest income from mortgage loans receivable, divided by the gross investment amount, gross proceeds in the case of dispositions, or loan repayment amount. Defensive Category is considered by us to represent tenants that focus on necessity goods and essential services in the retail sector, including discount stores, grocers, drug stores and pharmacies, home improvement, automotive service and quick-service restaurants, which we refer to as defensive retail industries. The defensive sub-categories as we define them are as follows: (1) Necessity, which are retailers that are considered essential by consumers and include sectors such as drug stores, grocers and home improvement, (2) Discount, which are retailers that offer a low price point and consist of off-price and dollar stores, (3) Service, which consist of retailers that provide services rather than goods, including, tire and auto services and quick service restaurants, and (4) Other, which are retailers that are not considered defensive in terms of being considered necessity, discount or service, as defined by us. 20
Non-GAAP Measures and Definitions (cont’d) 21 Investments are lease agreements in place at owned properties, properties that have leases associated with mortgage loans receivable, developments where rent commenced, interest earning developments, or in the case of master lease arrangements each property under the master lease is counted as a separate lease. Occupancy is expressed as a percentage, and it is the number of leased investments divided by the total number of investments owned, excluding properties under development. OP Units means operating partnership units not held by NETSTREIT. Weighted Average Lease Term is weighted by the annualized base rent, excluding lease extension options and investments associated with mortgage loans receivable.
Forward-Looking and Cautionary Statements 22 This supplemental report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, without limitation, statements concerning our business and growth strategies, investment, financing and leasing activities, including estimated development costs, and trends in our business, including trends in the market for single-tenant, retail commercial real estate. Words such as “expects,” “anticipates,” “intends,” “plans,” “likely,” “will,” “believes,” “seeks,” “estimates,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from the results of operations or plans expressed or implied by such forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore such statements included in this supplemental report may not prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the results or conditions described in such statements or our objectives and plans will be achieved. For a further discussion of these and other factors that could impact future results, performance or transactions, see the information under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 14, 2024 and other reports filed with the SEC from time to time. Forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this supplemental report. New risks and uncertainties may arise over time and it is not possible for us to predict those events or how they may affect us. Many of the risks identified herein and in our periodic reports have been and will continue to be heightened as a result of the ongoing and numerous adverse effects arising from macroeconomic conditions, including inflation, interest rates and instability in the banking system. We expressly disclaim any obligation or undertaking to update or revise any forward-looking statement contained herein, to reflect any change in our expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except to the extent otherwise required by law.
1 Investor Presentation February 2025
Disclaimer 2 This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, without limitation, statements concerning our business and growth strategies, investment, financing and leasing activities, including estimated development costs, and trends in our business, including trends in the market for single-tenant, retail commercial real estate. Words such as “expects,” “anticipates,” “intends,” “plans,” “likely,” “will,” “believes,” “seeks,” “estimates,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from the results of operations or plans expressed or implied by such forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore such statements included in this presentation may not prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the results or conditions described in such statements, or our objectives and plans will be achieved. For a further discussion of these and other factors that could impact future results, performance or transactions, see the information under the heading “Risk Factors” in our Form 10-K for the year ended December 31, 2023, filed with the SEC on February 14, 2024, and other reports filed with the SEC from time to time. Forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this presentation. New risks and uncertainties may arise over time, and it is not possible for us to predict those events or how they may affect us. Many of the risks identified herein and in our periodic reports have been and will continue to be heightened as a result of the ongoing and numerous adverse effects arising from macroeconomic conditions, including inflation, interest rates and instability in the banking system. We expressly disclaim any obligation or undertaking to update or revise any forward-looking statement contained herein, to reflect any change in our expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except to the extent otherwise required by law. This presentation also includes certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”) including, but not limited to, FFO, Core FFO, AFFO, EBITDA, EBITDAre, Adjusted EBITDAre, Annualized Adjusted EBITDAre, NOI, Cash NOI, Normalized Cash NOI, Net Debt, Adjusted Net Debt, and Pro forma Adjusted Net Debt. These non-GAAP financial measures are not measures of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing the Company’s financial results. Therefore, these measures should not be considered in isolation or as an alternative to net income, cash flows from operations or other measures of profitability, liquidity or performance under GAAP. You should be aware that the presentation of these measures may not be comparable to similarly-titled measures used by other companies. The Company believes these non-GAAP measures provide useful information to management and investors regarding certain financial and business trends relating to the Company’s financial condition and results of operations. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends in and in comparing its financial results with other similar companies, many of which present similar non-GAAP financial measures to investors. These non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-GAAP financial measures. Certain monetary amounts, percentages and other figures included in this presentation have been subject to rounding adjustments. Certain other amounts that appear in this presentation may not sum due to rounding.
Investment Highlights & Business Update 3 Source: Company data and balance sheet as of December 31, 2024, unless otherwise noted. Figures represent percentage of ABR unless otherwise noted. 1. Represents tenants with investment grade credit metrics (more than $1.0 billion in annual sales and a debt to adjusted EBITDA ratio of less than 2.0x), but do not carry a published rating from S&P, Fitch, Moody's, or NAIC. 2. Reflects 10,735,647 of unsettled forward equity shares at the December 31, 2024, weighted average net settlement price of $17.24 per share. 3. Assumes the increased revolving facility size to $500.0 million and the $175.0 million repayment towards the revolver balance had occurred as of December 31, 2024. 88% Necessity, Discount, and Service-Oriented Tenants 99.9% Occupancy 100% Rent Collection $635 million Total PF Liquidity2,3 4.5x Adj. Net Debt2 / Annualized Adj. EBITDAre ✓Focused on growing portfolio with high quality tenants that offer strong credit profiles and provide consistent performance through various economic cycles ✓Proven track record of full occupancy and rent collection; NTST’s single Big Lots vacancy has received strong interest from multiple retailers at or above current rent ✓Long weighted average lease term and de minimis intermediate-term lease expirations within the pharmacy and dollar store industries ✓Low leverage with no immediate-term debt maturities ✓$185.0mm of unsettled forward equity ✓Strong liquidity to provide ample runway for 2025 investments High Credit Quality & Resilient Net Lease Portfolio Well Capitalized Balance Sheet 71% Investment Grade (IG) and Investment Grade Profile (IGP)1 6.9% Wtd. Avg. Cash Yield Since 3Q’20 ✓Strong investment pace since 2020 with a solid pipeline of investment opportunities at attractive cash yields ✓$195.1 million of gross investments completed in 4Q’24 Proven Ability to Source Attractive Investment Opportunities 2028 First Term Loan Maturity $108 million Avg. Net Investments Per Quarter Since 3Q’20 27% Adj. Net Debt2 / Undepreciated Gross Assets ~$450 million Net Investments in 2024 7.5% YE’24 Cash Yield 9.8 Years Weighted Average Lease Term (WALT) 46bps Pharmacy & Dollar Store ABR Expiring Thru YE’28
8.6%5 6.2% 5.0% 4.9%5 4.2% 3.9% 3.8%5 3.0% 2.8% 2.6% BBB Portfolio Overview High-Quality, Diversified Portfolio Consisting of 55.8% Investment Grade Tenants Across 45 States 4 Source: Company data as of December 31, 2024, unless otherwise noted. 1. Includes acquisitions, mortgage loans receivable, and completed developments. 2. Calculation excludes properties under development and one vacant property. 3. Investments, or investments that are subsidiaries of a parent entity, with a credit rating of BBB- (S&P/Fitch), Baa3 (Moody’s), or NAIC2 (National Association of Insurance Commissioners) or higher. 4. Weighted by ABR; excludes lease extension options and investments that secure mortgage loans receivable. 5. Stats incorporate all completed activities as of February 24, 2025; all other portfolio stats are as of December 31, 2024. 6. Represent investments with investment grade credit metrics (more than $1.0 billion in annual sales and a debt to adjusted EBITDA ratio of less than 2.0x), but do not carry a published rating from S&P, Moody’s, Fitch, or NAIC. Key Portfolio Stats Investments1 687 States 45 Portfolio Square Feet (in millions) 12.6 Tenants 98 Retail Sectors 26 % Occupancy2 99.9% % Investment Grade Tenants (by ABR) 3 55.8% WALT (Years)4 9.8 Lease Turnover Through 2027 (by ABR) 5.1% National Footprint in Attractive Markets Top 10 Tenants by % of ABR Investment Grade BBB Sub-Investment Grade ≥1% and <3% ABR <1% ABR ≥5% ABR ≥3% and <5% ABR 0% ABR AK HI WA OR MT CA AZ WY NV ID UT CO NM TX OK ND SD NE KS LA AR MO IA MN WI IL IN MI OH KY TN FL MS AL GA SC NC VA WV PA DE NJ NY ME VT NH MA MD CT RI AA BBB+ BBB BB IG Profile Baa1 A A Investment Grade Profile6
Dollar Stores1: Home Improvement: 11.2% Grocery: 13.6% 1 Portfolio Diversification In Defensive Retail Sectors Nationally Diversified Portfolio Primarily Comprised of Recession Resilient Retail Tenants Source: Company data as of December 31, 2024. All figures represent percentage of ABR. Due to rounding, respective defensive retail sector exposure may not precisely reflect the absolute figures. 1. Stats incorporate all completed activities as of February 24, 2025; all other portfolio stats are as of December 31, 2024. Top Industries47.6% Necessity 18.8% Discount 12.5% Other Drug Stores & Pharmacies1: 10.0% 3 13.5% 2 4 Convenience Stores: 9.4% 5 21.1% Service 87.5% ABR Necessity Discount Service 5
Select Tenant Lease Expirations Minimal Lease Rollover Risk with Select Tenants through 2030 6 Next Next WALT Tenant 2025 2026 2027 2028 2029 2030 4 Years 6 Years Years Walgreens - - - 0.18% - - 0.18% 0.18% 9.3 CVS - 0.10% - - 0.15% 0.06% 0.10% 0.32% 11.0 Dollar Tree / Family Dollar - 0.07% - - 0.23% 0.09% 0.07% 0.40% 7.9 Dollar General - - - 0.11% 0.18% 0.10% 0.11% 0.39% 13.1 Advance Auto Parts - - - - - 0.04% - 0.04% 9.7 Total - 0.17% - 0.29% 0.57% 0.29% 0.46% 1.32% 10.6 Five Tenants % ABR Expiring Next 2 Years 0.17% Next 4 Years 0.46% Next 6 Years 1.32% Low Near and Intermediate-Term Lease Rollover Risk with Select Tenants: Active asset management and strong tenant relationships have resulted in well-managed lease expirations with the below tenants
Resilient, Cycle-Tested Investment Grade Credit Tenants with Durable Cash Flows1 >60% 70.8% (55.8% Investment Grade Credit and 15.0% Investment Grade Profile) Granular Assets in Highly Fragmented, Undercapitalized Market Segment $3.5 million Avg. Asset Size $1 to $10 million Avg. Asset Size Net Lease Retail Assets with Long Lease Term Benefiting From Contractual Rent Growth ~10 Year WALT 9.8 Year2 WALT Diversification by Industry, Tenant, State1 <15% Industry <50% Top 10 Tenants <15% State 13.6% Industry3 45.1% Top 10 Tenants3 12.3% State Significant Focus on Fundamental Real Estate Underwriting Attractive cost basis with durable valuation supported by market rents and demos, physical structure and location, and alternative use analyses 7 Source: Company data as of December 31, 2024, unless otherwise noted. 1. Portfolio statistics as a percentage of ABR. 2. Weighted by ABR; excludes lease extension options and investments that secure mortgage loans receivable. 3. Stats incorporates all completed activities as of February 24, 2025, as if they occurred by December 31, 2024. Current MetricsInvestment Philosophy Portfolio Strategy Defensive Tenancy in Necessity-Based and E-commerce-Resistant Retail Industries1 87.5%Primarily Consistent Investment Approach Disciplined and Deliberate Portfolio Construction
“Market-Taker Assets” 8 Inefficiently Priced Assets TYPICAL TRANSACTION - Well marketed transaction - Straight-forward transaction - Ability to finance transaction - Highly competitive, well capitalized investors TYPICAL TRANSACTION - Not highly marketed - May involve transaction structuring that limits buyer pool - Limited financing options - Less competitive Efficiently Priced Assets Acquisition Strategy – Bell Curve Investing Acquisition Strategy is Focused on Inefficiently Priced Assets Where Risk Adjusted Returns are Higher
9 Real Estate Valuation Unit-Level Profitability • Review underlying key real estate metrics to maximize re- leasing potential • Location analysis • Alternative use analysis • Determine rent coverage (min. 2.0x) and cost variability • Assess volatility and likelihood of cash flow weakness C B Tenant Credit Underwriting • Evaluate corporate level financials • Assess business risks • Determine ownership/sponsorship • Rigorous credit underwriting A L e v e l o f U n d e rw ri ti n g E m p h a s is Stringent Three-Part Underwriting Process Our Three-Pronged Approach Results in Superior Downside Protection
Investment Grade (rated) Investment Grade Profile (unrated) Sub-IG (rated) & Sub-IG Profile (unrated) Description • Validated financial strength and stability • Professional management with standardized operational practices • Focus on corporate guarantee credit • Lower relative yields • Higher competition for deals • IG-caliber balance sheets without explicit rating • Threshold metrics: • At least $1B in sales • Debt / adjusted EBITDA of less than 2.0x • Well-capitalized retailers • National footprint with strong brand equity • Focus on real estate quality / unit- level profitability • Higher relative yields • Lower competition for deals Durability • Coverage and credit enhancements required given more susceptible to market disruptions % Of ABR 55.8% 15.0% 29.2% Lease Terms (WALT, Rent Bumps, etc.) Less negotiating leverage More negotiating leverage Most negotiating leverage Representative Tenants 10 Source: Company data as of December 31, 2024, unless otherwise noted. 70.8% IG and IG Profile Defensive, consistent performance through economic cycles Strong Tenant Credit Underwriting Credit-Focused Underwriting Approach Drives Stable Revenue and Long-Term Return on Investment
11 Market-Level Considerations Property-Level Considerations • Fungibility of building for alternative uses • Replacement cost • Location analysis • Traffic counts • Nearby uses and traffic drivers, complementary nature thereof • Accessibility and parking capacity • Ingress and egress • Visibility / signage • Vacancy analysis • Marketability of the real estate without current tenant • List of likely replacement tenants • Rent analysis • Market rent versus in-place rent • Demographic analysis • Current demographics plus trends and forecasts • Competitive analysis • Market position versus competing retail corridors Real Estate Valuation Real Estate Closely Follows Credit as a Top Priority: We Utilize a Ground-Up Framework Rooted in Real Estate Fundamentals to Underpin Valuation and Further Quantify the Upside Potential of an Investment
12 Obtain Financial Info Perform Financial Analysis 2 Assess Investment Merits 1 3 • Provides clarity into location-specific performance • Analyze store demand dynamics, cost structure and liquidity profile • Determine whether property meets investment criteria • Obtain unit-level financial information from parent company if possible • If financials are not provided, utilize data provided by third party vendors to estimate sales by location • Third party data includes: • Cell phone traffic • Point of sales (POS) data • Triangulate P&L based on available information • Foot traffic • Sales • EBITDAR margin • Rent • Account for variability in business model cost structure • Higher proportion of fixed costs = more variability in rent coverage • Determine store ranking within tenant’s broader operating portfolio based on estimated sales Key Unit-Level Investment Criteria Minimum 2.0x Rent Coverage✓ Higher Cost Variability✓ Ranks in Top Half of Tenant’s Store Portfolio✓ Unit-Level Profitability Assess Unit-Level Financial Performance to Focus on Properties with Strong Rent Coverage and Higher Variability in Operating Costs
13 Source: Company filings from August 2020 through December 31, 2024. 1. Investments with investment grade credit metrics (more than $1.0 billion in annual sales and a debt to adjusted EBITDA ratio of less than 2.0x), but do not carry a published rating from S&P, Fitch, Moody’s, or NAIC. 2. Excludes lease extension options and investments that secure mortgage loans receivable. 3. Assumes cash cap rate is 30bps lower than reported GAAP cap rate. Volume ($ in millions) $2,210 $5,853 $2,894 $1,292 $4,541 Investment Grade % 63.5% 67.5% NA 54.8% NA Investment Grade Profile1 % 14.9% NA NA NA NA IG + IG Profile % 78.5% NA NA NA NA WALT2 11.3 9.7 9.7 10.7 15.0 Weighted Average Cash Yield 6.9% 6.3%3 7.0% 6.7% 7.5% History of Sourcing Investments at Attractive Yields Consistently Invested at Above-Market Yields Despite Focus on High-Quality Tenants Sourcing Volume Since 3Q’20
$128,615 $115,321 $117,455 $119,128 $129,207 $115,795 $151,555 $195,079 $0 $40,000 $80,000 $120,000 $160,000 $200,000 1Q'23 2Q'23 3Q'23 4Q'23 1Q'24 2Q'24 3Q'24 4Q'24 G ro s s I n v e s tm e n t A c ti v it y ($ 0 0 0 s ) 14 Investment Activity Summary Details Source: Company data as of December 31, 2024. 1. Includes acquisitions, mortgage loans receivable, and completed developments. 2. Excludes lease extension options and investments that secure mortgage loans receivable. Investments1 1Q'23 2Q'23 3Q'23 4Q'23 1Q'24 2Q'24 3Q'24 4Q'24 Number of Investments 71 39 29 57 42 28 33 52 Average Investment $1,811 $2,957 $4,050 $2,090 $3,076 $4,136 $4,593 $3,752 Cash Cap Rates 7.7% 6.8% 7.0% 7.2% 7.5% 7.5% 7.5% 7.4% IG + IGP % 94.9% 80.7% 97.2% 98.7% 84.8% 39.1% 52.4% 51.2% Weighted Average Lease Term2 10.3 11.5 10.0 10.9 11.5 16.7 12.5 14.0
$15,907 $4,060 $13,543 $15,995 $21,600 $12,707 $24,105 $59,337 $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 1Q'23 2Q'23 3Q'23 4Q'23 1Q'24 2Q'24 3Q'24 4Q'24 D is p o s it io n s A c ti v it y ($ 0 0 0 s ) 15 Disposition Activity Summary Details Source: Company data as of December 31, 2024. 1. Excludes vacant properties. Dispositions 1Q'23 2Q'23 3Q'23 4Q'23 1Q'24 2Q'24 3Q'24 4Q'24 Cash Cap Rates1 6.8% 6.7% 6.9% 7.2% 6.8% 6.8% 7.3% 7.1% Number of Investments 8 2 6 6 12 6 8 30 Weighted Average Lease Term 5.6 4.2 7.1 11.2 10.3 10.3 9.9 11.4
16 Source: Company data as of December 31, 2024. Since inception, the Company has disposed of 139 properties totaling $358 million, which has materially improved portfolio performance metrics such as tenant quality, WALT, and geographic diversity Identify properties not meeting strategy and/or risk management criteria (i.e. rent coverage) Periodically review all properties for changes in performance, credit, and local conditions Leverage 1031 exchange transfers where possible to access deep, non- institutional market for portfolio optimization Strategic Recycling Perpetual Stratification Active Monitoring Identify Active Asset Management Continuously Track Property Performance to Stratify Portfolio and Ensure a Secure Rental Stream
Source: Company data as December 31, 2024, unless otherwise noted. 1. The new $175.0 million senior unsecured term loan includes a one-year extension option to extend maturity to January 2030, at the Company’s discretion. 2. Company extended the existing $175.0 million term loan maturity to January 2029, with a one-year extension option to further extend maturity to January 2030. 3. Reflects 10,735,647 of unsettled forward equity shares at the December 31, 2024, weighted average net settlement price of $17.24 per share. 4. Assumes the increased facility size to $500.0 million and the $175.0 million repayment towards the revolver balance had occurred as of December 31, 2024. Conservative Balance Sheet with Improved Liquidity Balance Sheet Positioned for Growth Given Strong Liquidity Profile and Low Leverage Position Recently Completed Debt Transactions: Increased revolver facility to $500.0 million from $400.0 million and pushed maturity to January 2030; secured new $175.0 million senior unsecured term loan1; and extended existing $175.0 million term loan to January 20302 Abundant Liquidity to Support Growth: $635.2 million in total PF liquidity3,4 Well-Staggered Debt Maturity Profile: Increased weighted average debt maturity to 4.3 years; no term loan maturities expected until 2028 Unsecured Balance Sheet: Asset base is over 99% unencumbered Low Leverage: Adjusted Net Debt3 / Annualized Adjusted EBITDAre of 4.5x 17 $175 $175 $200 $500 $250 $8 $0 $200 $400 $600 $800 $1,000 2025 2026 2027 2028 2029 2030 In M ill io n s Debt Maturity Schedule – Pro Forma Revolver Capacity Existing Term Loans New Term Loan Mortgage Note
97% 21% 80% 26% 35% 56%19% 16% 6% 48% 3% 40% 10% 5% FCPT NTST EPRT ADC O NNN Service Discount Necessity 3.6% 11.7% 16.6% 18.9% 20.8% EPRT NTST O ADC NNN FCPT 56% 68% 56% 29% 14% 0% ADC FCPT NTST O NNN EPRT Source: Public filings as of December 31, 2024, unless otherwise noted. O is as of September 30, 2024. 1. Examples of service includes convenience stores, quick service restaurants, automotive service, and health and fitness. Examples of discount include dollar store and discount retail. Examples of necessity include, drug stores & pharmacy, home improvement, auto parts, and banking. Portfolio Highlights Relative to Peers NTST’s Stable & Predictable Cash Flow Profile Drives Superior Risk-Adjusted Returns Lease Rollover Through 2028 Average Investment Size per Property Investment Grade % Portfolio Composition1 Weighted-Average Lease Term 18 14.0 9.8 9.6 7.9 9.9 7.3 $3.9 $3.9 $3.4 $3.1 $2.7 $2.6 26.5%
Net Debt + Pref. / EBITDA3 Multiple and Earnings Growth Comparison Relative Valuation and Growth Remains Stable 19 Source: Public filings, FactSet and S&P Capital IQ. Note: Market data as of February 21, 2025. Capitalization data as of December 31, 2024, except O capitalization data as of September 30, 2024. 1. 2025E AFFO per share growth is calculated using FactSet mean 2025E AFFO per share estimates and 2024A AFFO per share. 2. 2024A AFFO per share multiple calculated using current price per share and 2024A AFFO per share. 3. Net Debt plus Preferred is adjusted for forward equity. 4. 2025E AFFO per share multiple calculated using current price per share and FactSet mean 2025E AFFO per share estimates. 2025E AFFO per Share Growth1 2024A AFFO per Share Multiple2 2025E AFFO per Share Multiple4 17.0x 16.9x 15.7x 13.2x 12.7x 12.6x 12.1x 11.1x 3.6x 3.8x 4.2x 4.5x 4.9x 5.2x 5.5x 5.5x 18.3x 17.6x 16.2x 13.6x 13.1x 13.0x 12.4x 11.4x 8.3% 3.7% 3.3% 3.1% 3.1% 3.0% 2.3% 1.7%
Implied Cap Rate G&A Adjusted Implied Cap Rate2 2025E AFFO Multiple 5.6% 5.2% 16.9x 5.6% 5.3% 17.0x 5.9% 5.3% 15.7x 6.7% 6.4% 13.2x 6.9% 6.5% 12.1x 8.1% 7.0% 11.1x Average 6.5% 6.0% 14.3x Applied Cap Rate and NAV Analysis Strong Upside Potential Given Relative Valuation Applied Nominal Cap Rate – Sensitivity Analysis 20 Peer Benchmarking (unaudited, in millions) Three Months Ended, December 31, 2024 NOI - Property $36.2 Straight-line Rental Adjustments (1.1) Amortization of Lease-Related Intangibles (0.1) Cash NOI - Property 35.0 Intraquarter Net Investment Activity 1.8 Normalized Cash NOI - Property 36.8 Annualized Normalized Cash NOI - Property $147.4 Applied Cap Rate 8.00% 7.75% 7.50% 7.25% 7.00% Implied Real Estate Value $1,842 $1,902 $1,965 $2,033 $2,105 Mortgage Loan Receivable 139.4 Property Under Development 6.1 Other Tangible Assets 58.2 Net Debt1 (672.8) Other Tangible Liabilities (29.7) Implied Equity Value $1,343 $1,403 $1,466 $1,534 $1,607 Fully Diluted Shares Outstanding 82.0 Unsettled Forward Shares1 10.7 Implied Equity Value per Share $14.48 $15.12 $15.81 $16.54 $17.32 Source: Public filings, FactSet and S&P Capital IQ. Note: Capitalization data as of December 31, 2024, except O capitalization data as of September 30, 2024. Market data as of February 21, 2025; closing price per share of $14.31. Companies may define adjusted cash NOI differently. Accordingly, such data for these companies and NTST may not be comparable. 1. Assumes 10.7 million of unsettled forward equity shares were settled for cash on December 31, 2024 at a weighted average net settlement price of $17.24 per share. 2. (NOI – TTM G&A) / Implied Real Estate Value.
21 Case Studies
Close Date: March 2023 Loan Amount: $46.1 million Interest Rate: 9.3% Location: Multiple – Southeast Term at Close: 3 years Parent Credit Rating: A / Baa2 22 • Loan provided the borrower funding to acquire a 49 property Speedway portfolio • Loan-to-value of ~60%, with first lien senior secured priority with no capital ahead of NETSTREIT’s loan • Yield maintenance provides protection from refinancing • Valuation excludes pending uncapped CPI rent escalations Investment Stats: Investment Highlights Case Study: Loan Strategy
23 • Acquisition of one Walmart Supercenter and one Sam’s Club by partnering and concurrently closing with a shopping center acquirer who purchased the remainder of the center • Significantly higher cap rate achieved through creative structuring • Strong retail corridor in Tupelo, MS INVESTMENT STATS:INVETMENT STATS: Close Date: July 2020 Purchase Price: $17.0 million Cash Cap Rate: 6.6% Location: Tupelo, MS Term at Close: 12 years Credit Rating: AA / Aa2 Investment Stats: Investment Highlights Case Study: Breakup Strategy
24 • NTST negotiated a new 10-year lease with only a 7.4% rent reduction to increase lease term by six years • Cash cap rate of 6.9% compares favorably to other 10-year Tractor Supply transactions in the market at the time • Exceptional real estate that tenant is committed to long term INVESTMENT STATS: Close Date: March 2021 Purchase Price: $6.2 million Post-B&E Cash Cap Rate: 6.9% Location: Olympia, WA Term at Close of B&E: 10.5 Years Credit Rating: BBB / Baa1 Investment Stats: Investment Highlights Case Study: Blend & Extend
25 Corporate Responsibility
26 Source: Company data. 1. Reflects gender and racial / ethnic diversity. Annual Director Elections Majority Voting Standard For Election of Directors Director Resignation Policy Annual Director and Committee Assessments No poison pill or differential voting stock structure to chill shareholder participation Shareholders’ right to amend the charter and bylaws by simple majority vote Separate non-executive Chair and CEO roles and Lead Independent Director with strong role and significant governance duties Governance Highlights Board Independence and Diversity 86% Independent Directors 50% Diverse Independent Directors1 43% Female Directors 4 Fully Independent Committees Governance We are committed to acting with honesty and integrity and conducting all corporate opportunities in an ethical manner.
27 401K Plan 100% company match of up to a 6% contribution Insurance Health, dental, and vision insurance costs covered at 90% for employees and 60% for dependents Leave Ten weeks of paid maternity leave at 100% salary as well as four weeks of paid family bonding; Company also provides jury duty, witness leave, and military leave Paid Time Off A minimum of twenty-three PTO days Paid Holidays Fourteen days of paid holidays Employee Assistance 24/7 toll-free hotline to access confidential counseling on various physical and mental health needs Continuing Education Reimbursement for certifications, tuition, courses, and seminars for continuing professional education BenefitsWorkforce Diversity Source: Company data. Social Responsibility Human capital management is the cornerstone of our ESG and corporate strategy. We believe in the value of a diverse workforce and inclusive culture. 39% Women 22% Ethnically Diverse
28 Source: Tenants within our portfolio that have public environmental, social, or governance initiatives as of December 31, 2024. 1. Includes the $200 million unsecured term loan which matures in February 2028 and the $250 million unsecured term loan which matures in January 2029. Environmental Responsibility We are committed to fulfilling our responsibility as an outstanding corporate citizen. ✓ 18 of our top 20 tenants have corporate sustainability initiatives in place ✓ 68% of ABR represents tenants with ESG initiatives ✓ We incorporated green lease clauses in our standard lease form and as part of our corporate guidelines ✓ We received Silver Level recognition from Green Lease Leaders for our efforts ✓ We incorporated sustainability-linked loan feature, based on SBTi, to our unsecured term loans and credit facility1 ✓ We completed scope 1 and 2 greenhouse gas emissions inventory for our corporate headquarters ✓ We participated annually in GRESB Public Disclosure ✓ Corporate headquarters is LEED v4 O+M: EB Gold Certified, meeting strict guidelines set forth by the Environmental Protection Agency ✓ Implementation of conservation practices in office Corporate Sustainability Initiatives from Tenants Greenhouse Gas Emissions Green Lease Clauses Sustainable Practices Science Based Target initiatives (“SBTi”) GRESB Public Disclosure
29 Financial Information and Non-GAAP Reconciliations
Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 REVENUES Rental revenue (including reimbursable) $ 40,598 $ 34,619 $ 150,823 $ 123,967 Interest income on loans receivable 3,103 2,243 11,561 7,388 Other revenue 400 — 400 550.00 Total revenues 44,101 36,862 162,784 131,905 OPERATING EXPENSES Property 4,845 5,064 17,422 16,413 General and administrative 4,456 4,876 19,722 20,176 Depreciation and amortization 20,349 17,078 76,871 63,677 Provisions for impairment 12,633 2,709 29,969 7,083 Transaction costs 158 189 359 456 Total operating expenses 42,441 29,916 144,343 107,805 OTHER INCOME (EXPENSE) Interest expense, net (8,576) (5,646) (30,324) (19,058) Gain on sales of real estate, net 1,002 506 1,876 1,175 Loss on debt extinguishment — — — (128) Other (expense) income, net 508 166 (1,944) 752 Total other expense, net (7,066) (4,974) (30,392) (17,259) Net (loss) income before income taxes (5,406) 1,972 (11,951) 6,841 Income tax (expense) benefit (18) (10) (49) 49 Net (loss) income (5,424) 1,962 (12,000) 6,890 Net (loss) income attributable to noncontrolling interests (28) 21 (63) 53 Net (loss) income attributable to common stockholders $ (5,396) $ 1,941 $ (11,937) $ 6,837 Amounts available to common stockholders per common share: Basic $ (0.07) $ 0.03 $ (0.16) $ 0.11 Diluted $ (0.07) $ 0.03 $ (0.16) $ 0.11 Weighted average common shares: Basic 81,585,762 69,276,514 76,517,767 63,922,973 Diluted 81,585,762 69,922,646 76,517,767 64,665,439 30 Consolidated Statements of Operations (unaudited, dollars in thousands, except per share data)
Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 GAAP Reconciliation: Net (loss) income $ (5,424) $ 1,962 $ (12,000) $ 6,890 Depreciation and amortization of real estate 20,275 17,000 76,560 63,379 Provisions for impairment 12,633 2,709 29,969 7,083 Gain on sales of real estate, net (1,002) (506) (1,876) (1,175) Funds from Operations (FFO) $ 26,482 $ 21,165 $ 92,653 $ 76,177 Non-recurring executive transition costs, severance and related charges 148 86 1,643 362 Loss on debt extinguishment and other related costs — — — 223 Other non-recurring loss (gain), net (142) (31) 2,934 (78) Core Funds from Operations (Core FFO) $ 26,488 $ 21,220 $ 97,230 $ 76,684 Straight-line rent adjustments (1,120) (456) (2,949) (1,163) Amortization of deferred financing costs 558 565 2,230 1,730 Amortization of above/below-market assumed debt 29 29 114 114 Amortization of loan origination costs and discounts (123) 80 (365) 163 Amortization of lease-related intangibles (95) (93) (458) (611) Earned development interest 110 326 1,072 515 Capitalized interest expense (97) (372) (806) (1,060) Non-cash interest expense (841) (990) (3,789) (2,124) Non-cash compensation expense 999 1,264 5,126 4,822 Adjusted Funds from Operations (AFFO) $ 25,908 $ 21,573 $ 97,405 $ 79,070 FFO per common share, diluted $ 0.32 $ 0.30 $ 1.20 $ 1.18 Core FFO per common share, diluted $ 0.32 $ 0.30 $ 1.26 $ 1.19 AFFO per common share, diluted $ 0.32 $ 0.31 $ 1.26 $ 1.22 Dividends per share $ 0.210 $ 0.205 $ 0.830 $ 0.810 Dividends per share as a percent of AFFO 66% 66% 66% 66% Weighted average common shares outstanding, basic 81,585,762 69,276,514 76,517,767 63,922,973 Operating partnership units outstanding 424,956 486,096 444,435 501,751 Unvested restricted stock units 142,686 160,036 123,992 165,420 Unsettled shares under open forward equity contracts — — 233,606 75,295 Weighted average common shares outstanding, diluted 82,153,404 69,922,646 77,319,800 64,665,439 31 Funds From Operations and Adjusted Funds From Operations (unaudited, dollars in thousands, except per share data)
1. Adjustment reflects the estimated cash yield on developments in process as of December 31, 2024. 2. Adjustment assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended December 31, 2024, had occurred on October 1, 2024. 3. We calculate Annualized Adjusted EBITDAre by multiplying Adjusted EBITDAre by four. 4. Reflects 10,735,647 of unsettled forward equity shares at the December 31, 2024, available net settlement price of $17.24 per share. 32 EBITDAre and Adjusted EBITDAre (unaudited, dollars in thousands) Three Months Ended December 31, 2024 2023 GAAP Reconciliation: Net (loss) income $ (5,424) $ 1,962 Depreciation and amortization of real estate 20,275 17,000 Amortization of lease-related intangibles (95) (93) Non-real estate depreciation and amortization 75 78 Interest expense, net 8,576 5,646 Income tax expense 18 10 Amortization of loan origination costs and discounts (123) 80 EBITDA 23,302 24,683 Adjustments: Provisions for impairment 12,633 2,709 Gain on sales of real estate, net (1,002) (506) EBITDAre 34,933 26,886 Adjustments: Straight-line rent adjustments (1,120) (456) Non-recurring executive transition costs, severance and related charges 148 86 Other non-recurring gain, net (142) (31) Other non-recurring expenses, net 438 — Transaction costs 158 189 Non-cash compensation expense 999 1,264 Lease termination fees (400) — Adjustment for construction in process(1) 152 719 Adjustment for intraquarter investment activities(2) 1,910 820 Adjusted EBITDAre $ 37,076 $ 29,477 Annualized Adjusted EBITDAre(3) $ 148,304 Net Debt As of December 31, 2024 Principal amount of total debt $ 872,205 Less: Cash, cash equivalents and restricted cash (14,320) Net Debt $ 857,885 Less: Net value of unsettled forward equity(4) (185,063) Adjusted Net Debt $ 672,822 Leverage Net Debt / Annualized Adjusted EBITDAre 5.8 x Adjusted Net Debt / Annualized Adjusted EBITDAre 4.5 x
1. Adjustments assumes all re-leasing activity, investments in and dispositions of real estate, including developments completed during the three months ended December 31, 2024, had occurred on October 1, 2024. 2. Adjustment assumes all loan activity completed during the three months ended December 31, 2024, had occurred on October 1, 2024. Three Months Ended December 31, 2024 2023 GAAP Reconciliation: Net (loss) income $ (5,424) $ 1,962 General and administrative 4,456 4,876 Depreciation and amortization 20,349 17,078 Provisions for impairment 12,633 2,709 Transaction costs 158 189 Interest expense, net 8,576 5,646 Gain on sales of real estate, net (1,002) (506) Income tax expense 18 10 Amortization of loan origination costs and discounts (123) 80 Interest income on mortgage loans receivable (3,103) (2,243) Lease termination fees (400) — Other expense, net 103 (166) Property-Level NOI 36,241 29,635 Straight-line rent adjustments (1,120) (456) Amortization of lease-related intangibles (95) (93) Property-Level Cash NOI $ 35,026 $ 29,086 Adjustment for intraquarter acquisitions, dispositions and completed development(1) 1,817 Property-Level Cash NOI Estimated Run Rate $ 36,843 Interest income on mortgage loans receivable 3,103 Adjustments for intraquarter mortgage loan activity(2) 93 Total Cash NOI - Estimated Run Rate $ 40,039 Property Operating Expense Coverage Property operating expense reimbursement $ 4,092 $ 4,415 Property operating expenses (4,845) (5,064) Property operating expenses, net $ (752) $ (648) 33 Net Operating Income (unaudited, dollars in thousands)
December 31, 2024 2023 ASSETS Real estate, at cost: Land $ 571,272 $ 460,896 Buildings and improvements 1,400,393 1,149,809 Total real estate, at cost 1,971,665 1,610,705 Less accumulated depreciation (143,422) (101,210) Property under development 6,118 29,198 Real estate held for investment, net 1,834,361 1,538,693 Assets held for sale 48,637 52,451 Mortgage loans receivable, net 139,409 114,472 Cash, cash equivalents and restricted cash 14,320 29,929 Lease intangible assets, net 164,392 161,354 Other assets, net 58,227 49,337 Total assets $ 2,259,346 $ 1,946,236 LIABILITIES AND EQUITY Liabilities: Term loans, net $ 622,608 $ 521,912 Revolving credit facility 239,000 80,000 Mortgage note payable, net 7,853 7,883 Lease intangible liabilities, net 20,177 25,353 Liabilities related to assets held for sale 1,912 1,158 Accounts payable, accrued expenses and other liabilities 29,664 36,498 Total liabilities $ 921,214 $ 672,804 Equity: Stockholders’ equity Common stock, $0.01 par value, 400,000,000 shares authorized; 81,602,232 and 73,207,080 shares issued and outstanding as of December 31, 2024 and 2023, respectively $ 816 $ 732 Additional paid-in capital 1,507,995 1,367,505 Distributions in excess of retained earnings (188,046) (112,276) Accumulated other comprehensive income 10,206 8,943 Total stockholders’ equity 1,330,971 1,264,904 Noncontrolling interests 7,161 8,528 Total equity 1,338,132 1,273,432 Total liabilities and equity $ 2,259,346 $ 1,946,236 34 Consolidated Balance Sheets (unaudited, dollars in thousands, except per share data)
1. Rates presented exclude the impact of capitalized loan fee amortization. Interest rates that consist of fixed rate SOFR swaps include a credit spread adjustment of 0.10% and a borrowing spread of 1.15%. 2. Interest rate reflects the all-in borrowing rate as of December 31, 2024. Facility fees are charged at an annual rate of 0.15% of the total facility size of $400 million, and are not included in the interest rate presented. The facility has a one-year extension option. Remaining capacity reduced by $0.15 million for outstanding letters of credit. 3. The term loan matures on July 3, 2026, and includes two one-year extension options and one six-month extension option. 4. The mortgage note was assumed as part of an asset acquisition during the third quarter of 2022. 5. The total facility size increased to $500.0 million and the maturity was extended to January 15, 2029, and includes a one-year extension option. 6. The term loan was amended to extend the maturity to January 15, 2029, and includes a one-year extension option. Existing fixed rate SOFR swap expires in January 2027; the term loan is unhedged beyond that date. 7. The term loan matures on January 15, 2029, and includes a one-year extension option. Debt, Capitalization, and Financial Ratios (unaudited, dollars in thousands) 35 $175 $200 $250 $8 $400 $0 $200 $400 $600 $800 $1,000 2025 2026 2027 2028 2029 2030 $175 $175 $200 $500 $250 $8 $0 $200 $400 $600 $800 $1,000 2025 2026 2027 2028 2029 2030 Debt Maturity Schedule Proforma Debt Maturity Schedule Revolver Capacity Existing Term Loans Term Loan B Mortgage Note As of December 31, 2024 Debt Summary Fully Extended Maturity Principal Balance Fixed Rate SOFR Swap Interest Rate(1) Remaining Capacity Available Term (years) Unsecured revolver(2) August 11, 2027 $ 239,000 —% 5.63% $ 160,850 2.6 Unsecured term loan January 15, 2027 175,000 2.40% 3.65% — 2.0 Unsecured term loan February 11, 2028 200,000 2.63% 3.88% — 3.1 Unsecured term loan(3) January 3, 2029 250,000 3.74% 4.99% — 4.0 Mortgage note(4) November 1, 2027 8,205 —% 4.53% — 2.8 Total / Weighted Average $ 872,205 3.01% 4.64% $ 160,850 3.0 Proforma as of December 31, 2024 Debt Summary Fully Extended Maturity Principal Balance Fixed Rate SOFR Swap Interest Rate(1) Remaining Capacity Available Term (years) Unsecured revolver(5) January 15, 2030 $ 64,000 —% 5.63% $ 435,850 5.0 Unsecured term loan February 11, 2028 200,000 2.63% 3.88% — 3.1 Unsecured term loan January 3, 2029 250,000 3.74% 4.99% — 4.0 Unsecured term loan A(6) January 15, 2030 175,000 2.40% 3.65% — 5.0 Unsecured term loan B(7) January 15, 2030 175,000 3.87% 5.12% — 5.0 Mortgage note November 1, 2027 8,205 —% 4.53% — 2.8 Total / Weighted Average $ 872,205 3.20% 4.53% $ 435,850 4.3
Net Debt December 31, 2024 Principal amount of total debt $ 872,205 Less: Cash, cash equivalents and restricted cash (14,320) Net Debt $ 857,885 Less: Net value of unsettled forward equity(1) (185,063) Adjusted Net Debt $ 672,822 Net Debt / Annualized Adjusted EBITDAre 5.8x Adjusted Net Debt / Annualized Adjusted EBITDAre 4.5x Key Debt Covenant Information Required Actual Consolidated total leverage ratio ≤ 60.0% 32.9 % Fixed charge coverage ratio ≥ 1.50x 3.92x Maximum secured indebtedness ≤ 40.0% 0.3 % Maximum recourse indebtedness ≤ 10.0% — % Unencumbered leverage ratio ≤ 60.0% 34.7 % Unencumbered interest coverage ratio ≥ 1.75x 3.92x Proforma Liquidity As of December 31, 2024 Unused unsecured revolver capacity(2) $ 435,850 Cash, cash equivalents and restricted cash 14,320 Net value of unsettled forward equity(1) 185,063 Total Proforma Liquidity $ 635,233 Equity Ending Shares/ Units as of December 31, 2024 Equity Market Capitalization % of Total Common shares(3) 81,602,232 $ 1,154,672 99.5 % OP units(3) 424,956 6,013 0.5 % Total 82,027,188 $ 1,160,685 100.0 % Enterprise Value As of December 31, 2024 % of Total Principal amount of total debt $ 872,205 42.9 % Equity market capitalization(3) 1,160,685 57.1 % Total enterprise value $ 2,032,890 100.0 % 1. Reflects 10,735,647 of unsettled shares under forward sale agreements at the December 31, 2024, weighted average net settlement price of $17.24 per share. 2. Assumes the increased facility size to $500.0 million and the $175.0 million repayment towards the revolver balance had occurred as of December 31, 2024. 3. Value is based on the December 31, 2024, closing share price of $14.15 per share. 36 Debt, Capitalization, and Financial Ratios (cont’d) (unaudited, dollars in thousands)
FFO, Core FFO, and AFFO FFO means funds from operations. It is a non-GAAP measure defined by NAREIT as net (loss) income (computed in accordance with GAAP), excluding gains (or losses) resulting from dispositions of properties, plus depreciation and amortization and impairment charges on depreciable real property. Core FFO means core funds from operations. Core FFO is a non-GAAP financial measure defined as FFO adjusted to remove the effect of unusual and non-recurring items that are not expected to impact our operating performance or operations on an ongoing basis. These include non-recurring executive transition costs, severance and related charges, non-recurring other loss (gain), net, and loss on debt extinguishments and other related costs. AFFO means adjusted funds from operations. AFFO is a non-GAAP financial measure defined as Core FFO adjusted for GAAP net (loss) income related to non-cash revenues and expenses, such as straight-line rent, amortization of above- and below-market lease-related intangibles, amortization of lease incentives, capitalized interest expense, earned development interest, non-cash interest expense, non-cash compensation expense, amortization of deferred financing costs, amortization of above/below-market assumed debt, and amortization of loan origination costs. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. In fact, real estate values historically have risen or fallen with market conditions. FFO is intended to be a standard supplemental measure of operating performance that excludes historical cost depreciation and valuation adjustments from net income. We consider FFO to be useful in evaluating potential property acquisitions and measuring operating performance. We further consider FFO, Core FFO and AFFO to be useful in determining funds available for payment of distributions. FFO, Core FFO and AFFO do not represent net (loss) income or cash flows from operations as defined by GAAP. You should not consider FFO, Core FFO and AFFO to be alternatives to net (loss) income as a reliable measure of our operating performance nor should you consider FFO, Core FFO and AFFO to be alternatives to cash flows from operating, investing or financing activities (as defined by GAAP) as measures of liquidity. FFO, Core FFO and AFFO do not measure whether cash flow is sufficient to fund our cash needs, including principal amortization, capital improvements and distributions to stockholders. FFO, Core FFO and AFFO do not represent cash flows from operating, investing or financing activities as defined by GAAP. Further, FFO, Core FFO and AFFO as disclosed by other REITs might not be comparable to our calculations of FFO, Core FFO and AFFO. 37 Non-GAAP Measures and Definitions
EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre EBITDA is defined as earnings before interest expense, income tax expense, and depreciation and amortization. EBITDAre is the NAREIT definition of EBITDA (as defined above), but it is further adjusted to follow the definition included in a white paper issued in 2017 by NAREIT, which recommended that companies that report EBITDA also report EBITDAre. We compute EBITDAre in accordance with the definition adopted by NAREIT. NAREIT defines EBITDAre as EBITDA (as defined above) excluding gains (or losses) from sales of depreciable property and impairment charges on depreciable real property. Adjusted EBITDAre is a non-GAAP financial measure defined as EBITDAre adjusted to exclude straight-line rent, non-cash compensation expense, non-recurring executive transition costs, severance and related charges, loss on debt extinguishment and other related costs, other non-recurring loss (gain), net, other non-recurring expenses (income), transaction costs, lease termination fees, adjustment for construction in process, and adjustment for intraquarter activities. Annualized Adjusted EBITDAre is a non-GAAP financial measure defined as Adjusted EBITDAre multiplied by four. We present EBITDA, EBITDAre, Adjusted EBITDAre, and Annualized Adjusted EBITDAre as they are measures commonly used in our industry. We believe that these measures are useful to investors and analysts because they provide supplemental information concerning our operating performance, exclusive of certain non-cash items and other costs. We use EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre as measures of our operating performance and not as measures of liquidity. EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre do not include all items of revenue and expense included in net (loss) income, they do not represent cash generated from operating activities and they are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net (loss) income as a performance measure or cash flows from operations as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures. Additionally, our computation of EBITDA, EBITDAre, Adjusted EBITDAre and Annualized Adjusted EBITDAre may differ from the methodology for calculating these metrics used by other equity REITs and, therefore, may not be comparable to similarly titled measures reported by other equity REITs. Net Debt and Adjusted Net Debt Net Debt is calculated as our principal amount of total debt outstanding excluding deferred financing costs, net discounts and debt issuance costs less cash, cash equivalents and restricted cash available for future investment. We believe excluding cash, cash equivalents and restricted cash available for future investment from our principal amount, all of which could be used to repay debt, provides an estimate of the net contractual amount of borrowed capital to be repaid. We believe these adjustments are additional beneficial disclosures to investors and analysts. Adjusted Net Debt is Net Debt adjusted by the net value of unsettled forward equity as of period end. 38 Non-GAAP Measures and Definitions (cont’d)
Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate are non- GAAP financial measures which we use to assess our operating results. We compute Property-Level NOI as net income (computed in accordance with GAAP), excluding general and administrative expenses, interest expense (or income), income tax expense, amortization of loan origination costs and discounts, transaction costs, depreciation and amortization, gains (or losses) on sales of depreciable property, real estate impairment losses, interest income on mortgage loans receivable, loss on debt extinguishment, lease termination fees, and other expense (income), net. We further adjust Property-Level NOI for non-cash revenue components of straight-line rent and amortization of lease-intangibles to derive Property- Level Cash NOI. We further adjust Property-Level Cash NOI for intraquarter acquisitions, dispositions and completed developments to derive Property-Level Cash NOI - Estimated Run Rate. We further adjust Property-Level Cash NOI - Estimated Run Rate for interest income on mortgage loans receivable and intraquarter mortgage loan activity to derive Total Cash NOI - Estimated Run Rate. We believe Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate provide useful and relevant information because they reflect only those income and expense items that are incurred at the property level and present such items on an unlevered basis. Property-Level NOI, Property-Level Cash NOI, Property-Level Cash NOI - Estimated Run Rate, and Total Cash NOI - Estimated Run Rate are not measurements of financial performance under GAAP, and may not be comparable to similarly titled measures of other companies. You should not consider our measures as alternatives to net income or cash flows from operating activities determined in accordance with GAAP. Other Definitions ABR is annualized base rent as of December 31, 2024, for all leases that commenced and annualized cash interest on mortgage loans receivable in place as of that date. Cash Yield is the annualized base rent contractually due from acquired properties and completed developments, and interest income from mortgage loans receivable, divided by the gross investment amount, gross proceeds in the case of dispositions, or loan repayment amount. Defensive Category is considered by us to represent tenants that focus on necessity goods and essential services in the retail sector, including discount stores, grocers, drug stores and pharmacies, home improvement, automotive service and quick-service restaurants, which we refer to as defensive retail industries. The defensive sub-categories as we define them are as follows: (1) Necessity, which are retailers that are considered essential by consumers and include sectors such as drug stores, grocers and home improvement, (2) Discount, which are retailers that offer a low price point and consist of off- price and dollar stores, (3) Service, which consist of retailers that provide services rather than goods, including, tire and auto services and quick service restaurants, and (4) Other, which are retailers that are not considered defensive in terms of being considered necessity, discount or service, as defined by us. 39 Non-GAAP Measures and Definitions (cont’d)
Investments are lease agreements in place at owned properties, properties that have leases associated with mortgage loans receivable, developments where rent commenced, interest earning developments, or in the case of master lease arrangements each property under the master lease is counted as a separate lease. Occupancy is expressed as a percentage, and it is the number of leased investments divided by the total number of investments owned, excluding properties under development. OP Units means operating partnership units not held by NETSTREIT. Weighted Average Lease Term is weighted by the annualized base rent, excluding lease extension options and investments associated with mortgage loans receivable. 40 Non-GAAP Measures and Definitions (cont’d)
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- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14d
-Subsection 2b
| Name: |
dei_PreCommencementTenderOffer |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionTitle of a 12(b) registered security. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b
| Name: |
dei_Security12bTitle |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:securityTitleItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionName of the Exchange on which a security is registered. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection d1-1
| Name: |
dei_SecurityExchangeName |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:edgarExchangeCodeItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14a
-Subsection 12
| Name: |
dei_SolicitingMaterial |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionTrading symbol of an instrument as listed on an exchange.
| Name: |
dei_TradingSymbol |
| Namespace Prefix: |
dei_ |
| Data Type: |
dei:tradingSymbolItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
| X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act. Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 425
| Name: |
dei_WrittenCommunications |
| Namespace Prefix: |
dei_ |
| Data Type: |
xbrli:booleanItemType |
| Balance Type: |
na |
| Period Type: |
duration |
|
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