10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended March 31, 2015.

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .  

Commission File No. 001-36739

STORE CAPITAL CORPORATION

(Exact name of registrant as specified in its charter)

Maryland	45-2280254
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

8501 East Princess Drive, Suite 190, Scottsdale, Arizona 85255

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (480) 256-1100

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  YES ☒ NO ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  YES ☒ NO ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☐	Accelerated Filer ☐
Non-accelerated Filer ☒	Smaller Reporting Company ☐
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)  YES ☐ NO ☒

As of May 14, 2015, there were 115,288,537 shares of the registrant’s $0.01 par value common stock outstanding.

TABLE OF CONTENTS

Part I. - FINANCIAL INFORMATION	Page
Item 1.     Financial Statements	3
Condensed Consolidated Balance Sheets as of March 31, 2015 (unaudited) and December 31, 2014	3
Condensed Consolidated Statements of Income for the three months ended March 31, 2015 and 2014 (unaudited)	4
Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2015 and 2014 (unaudited)	5
Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2015 and 2014 (unaudited)	6
Notes to Condensed Consolidated Financial Statements (unaudited)	7
Item 2.     Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.     Quantitative and Qualitative Disclosures About Market Risk	35
Item 4.     Controls and Procedures	36
Part II. - OTHER INFORMATION
Item 1.     Legal Proceedings	37
Item 1A.  Risk Factors	37
Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.     Defaults Upon Senior Securities	37
Item 4.     Mine Safety Disclosures	38
Item 5.     Other Information	38
Item 6.     Exhibits	38
Signatures	38
Exhibit Index	39

2

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

STORE Capital Corporation

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

	March 31,		December 31,
	2015		2014
	(unaudited)		(audited)
Assets
Investments:
Real estate investments:
Land and improvements	$	913,149	$	843,843
Buildings and improvements		1,960,169		1,790,530
Intangible lease assets		69,589		60,184
Total real estate investments		2,942,907		2,694,557
Less accumulated depreciation and amortization		(117,106)		(98,671)
		2,825,801		2,595,886
Real estate investments held for sale, net		6,809		—
Loans and direct financing receivables		145,850		111,354
Net investments		2,978,460		2,707,240
Cash and cash equivalents		30,324		136,313
Deferred costs, net		36,385		37,136
Other assets		20,684		32,923
Total assets	$	3,065,853	$	2,913,612
Liabilities and stockholders’ equity
Liabilities:
Credit facility	$	162,000	$	—
Non-recourse debt obligations of consolidated special purpose entities, net		1,279,220		1,284,151
Dividends payable		28,822		13,123
Accounts payable and accrued expenses		21,067		30,486
Other liabilities		3,044		3,168
Total liabilities		1,494,153		1,330,928
Stockholders’ equity:
Common stock, $0.01 par value per share, 375,000,000 shares authorized, 115,289,827 and 115,212,541 shares issued and outstanding, respectively		1,153		1,152
Capital in excess of par value		1,637,124		1,636,203
Distributions in excess of retained earnings		(66,160)		(54,405)
Accumulated other comprehensive loss		(417)		(266)
Total stockholders’ equity		1,571,700		1,582,684
Total liabilities and stockholders’ equity	$	3,065,853	$	2,913,612

See accompanying notes.

3

STORE Capital Corporation

Condensed Consolidated Statements of Income

(unaudited)

(In thousands, except share and per share data)

	Three Months Ended March 31,
	2015		2014
Revenues:
Rental revenues	$	58,838	$	37,534
Interest income on loans and direct financing receivables		2,598		1,790
Other income		23		5
Total revenues		61,459		39,329
Expenses:
Interest		17,229		14,405
Transaction costs		259		398
Property costs		295		37
General and administrative		6,635		4,183
Depreciation and amortization		18,892		11,561
Provision for impairment of real estate		1,000		—
Total expenses		44,310		30,584
Income from continuing operations before income taxes		17,149		8,745
Income tax expense		83		52
Income from continuing operations		17,066		8,693
Income from discontinued operations		—		846
Net income	$	17,066	$	9,539
Net income per share of common stock—basic and diluted:
Continuing operations	$	0.15	$	0.14
Discontinued operations		—		0.01
Net income	$	0.15	$	0.15
Weighted average common shares outstanding:
Basic		114,633,300		63,025,215
Diluted		114,633,300		63,025,215
Dividends declared per common share	$	0.2500	$	0.2395

See accompanying notes.

4

STORE Capital Corporation

Condensed Consolidated Statements of Comprehensive Income

(unaudited)

(In thousands)

	Three Months Ended March 31,
	2015		2014
Net income	$	17,066	$	9,539
Other comprehensive (loss) income:
Change in unrealized losses on cash flow hedges		(228)		(110)
Cash flow hedge losses reclassified to interest expense		77		79
Total other comprehensive loss		(151)		(31)
Total comprehensive income	$	16,915	$	9,508

See accompanying notes.

5

STORE Capital Corporation

Condensed Consolidated Statements of Cash Flows

(unaudited)

(In thousands)

	Three Months Ended
	March 31,
	2015		2014
Operating activities
Net income	$	17,066	$	9,539
Adjustments to net income:
Depreciation and amortization		18,892		11,561
Provision for impairment of real estate		1,000		—
Amortization of deferred financing costs		1,546		1,359
Amortization of debt (premium) and discount, net		(149)		(25)
Amortization of equity-based compensation		897		373
Gain on dispositions of real estate		—		(743)
Noncash revenue and other		333		(496)
Changes in operating assets and liabilities:
Deferred costs		(361)		(366)
Other assets		82		4,149
Accounts payable and other liabilities		(3,233)		(4,375)
Net cash provided by operating activities		36,073		20,976
Investing activities
Acquisition of and additions to real estate		(264,245)		(248,536)
Investment in loans and direct financing receivables		(34,683)		(36,046)
Collections of principal on loans and direct financing receivables		175		4,884
Proceeds from disposition of real estate		48		6,687
Transfers from (to) restricted deposits		12,996		(2,903)
Net cash used in investing activities		(285,709)		(275,914)
Financing activities
Borrowings under credit facilities		172,000		167,080
Repayments under credit facilities		(10,000)		—
Borrowings under non-recourse debt obligations of consolidated special purpose entities		—		26,175
Repayments under non-recourse debt obligations of consolidated special purpose entities		(4,782)		(4,291)
Financing costs paid		(8)		(487)
Proceeds from the issuance of common stock		1		75,001
Offering costs paid		(441)		—
Dividends paid		(13,123)		(15,140)
Net cash provided by financing activities		143,647		248,338
Net decrease in cash and cash equivalents		(105,989)		(6,600)
Cash and cash equivalents, beginning of period		136,313		61,814
Cash and cash equivalents, end of period	$	30,324	$	55,214
Supplemental disclosure of noncash investing activities:
Accrued tenant improvement advances included in real estate investments	$	—	$	1,885
Accrued financing costs	$	494		—
Supplemental disclosure of cash flow information:
Cash paid during the period for interest, net of amounts capitalized	$	15,358	$	12,805
Cash paid during the period for income and franchise taxes	$	483	$	209

See accompanying notes.

6

STORE Capital Corporation

Notes to Condensed Consolidated Financial Statements

March 31, 2015

1. Organization and Formation Activities

STORE Capital Corporation (STORE Capital or the Company) was formed in Maryland on May 17, 2011 to acquire single‑tenant operational real estate to be leased on a long‑term, net basis to companies that operate across a wide variety of industries within the service, retail and industrial sectors of the United States economy. From time to time, it may also provide mortgage financing to its customers.

On November 21, 2014, the Company completed the initial public offering (IPO) of its common stock.  The shares began trading on the New York Stock Exchange on November 18, 2014 under the ticker symbol “STOR”.  The Company was originally formed as a wholly-owned subsidiary of STORE Holding Company, LLC (STORE Holding), a Delaware limited liability company. In March 2015, STORE Holding redeemed all of its Series Amembership interests that were held by members of the Company’s board and senior managementthrough the distribution of common shares of the Companyto those members. Following this redemption, the voting interests of STORE Holding are entirely owned by entities managed by a global investment management firm.At March 31, 2015, there were 115,289,827 shares of the Company’s common stock outstanding, of which 82,148,644 shares were held by STORE Holding, representing a 71.25% ownership of the Company.

STORE Capital has made an election to qualify, and believes it is operating in a manner to continue to qualify, as a real estate investment trust (REIT) for federal income tax purposes beginning with its initial taxable year ended December 31, 2011. As a REIT, it will generally not be subject to federal income taxes to the extent that it distributes all of its taxable income to its stockholders and meets other specific requirements.

2. Summary of Significant Accounting Principles

Basis of Accounting and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (SEC). In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of interim periods are not necessarily indicative of the results for the entire year.  Certain information and note disclosures, normally included in financial statements prepared in accordance with GAAP, have been condensed or omitted from these statements and, accordingly, these statements should be read in conjunction with the Company’s audited consolidated financial statements as filed with the SEC in its Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

These consolidated statements include the accounts of STORE Capital Corporation and its subsidiaries which are wholly‑owned and controlled by the Company through its voting interest. One of the Company’s wholly‑owned subsidiaries, STORE Capital Advisors, LLC, provides all of the general and administrative services for the day‑to‑day operations of the consolidated group, including property acquisition and lease origination, real estate portfolio management and marketing, accounting and treasury services. The remaining subsidiaries were formed to acquire and hold real estate investments or to facilitate non‑recourse secured borrowing activities. Generally, the initial operations of the real estate subsidiaries are funded by an interest‑bearing intercompany loan from STORE Capital Corporation, and such intercompany loan is repaid when the subsidiary issues long‑term debt secured by its properties. All intercompany account balances and transactions have been eliminated in consolidation.

Certain of the Company’s wholly‑owned consolidated subsidiaries were formed as special purpose entities. Each special purpose entity is a separate legal entity and is the sole owner of its assets and liabilities. The assets of the

7

special purpose entities are not available to pay or otherwise satisfy obligations to the creditors of any owner or affiliate of the special purpose entity. At March 31, 2015 and December 31, 2014, assets totaling $2.7 billion and $2.5 billion, respectively, were held and third-party liabilities totaling $1.3 billion were owed by these special purpose entities and are included in the accompanying consolidated balance sheets.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period. Although management believes its estimates are reasonable, actual results could differ from those estimates.

Segment Reporting

The Financial Accounting Standards Board’s (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting, established standards for the manner in which enterprises report information about operating segments. The Company views its operations as one reportable segment.

Accounting for Real Estate Investments

STORE Capital records the acquisition of real estate properties at cost, including acquisition and closing costs. The Company allocates the cost of real estate properties to the tangible and intangible assets and liabilities acquired based on their estimated relative fair values. Real estate properties subject to an existing in‑place lease at the date of acquisition are recorded as business combinations and each tangible and intangible asset and liability acquired is recorded at fair value. Management uses multiple sources to estimate fair value, including independent appraisals and information obtained about each property as a result of its pre‑acquisition due diligence and its marketing and leasing activities. The Company expenses transaction costs associated with real estate acquisitions accounted for as business combinations in the period incurred.

In‑place lease intangibles are valued based on management’s estimates of lost rent and carrying costs during the time it would take to locate a tenant if the property were vacant, considering current market conditions and costs to execute similar leases. In estimating lost rent and carrying costs, management considers market rents, real estate taxes, insurance, costs to execute similar leases including leasing commissions and other related costs. The value assigned to in‑place leases is amortized on a straight‑line basis as a component of depreciation and amortization expense typically over the remaining term of the related leases.

The fair value of any above‑market and below‑market leases is estimated based on the present value of the difference between the contractual amounts to be paid pursuant to the in‑place lease and management’s estimate of current market lease rates for the property, measured over a period equal to the remaining term of the lease. Capitalized above‑market lease intangibles are amortized over the remaining term of the respective leases as a decrease to rental revenue. Below‑market lease intangibles are amortized as an increase in rental revenue over the remaining term of the respective leases plus the fixed‑rate renewal periods on those leases, if any. Should a lease terminate early, the unamortized portion of any related lease intangible is immediately recognized in operations.

The Company’s real estate portfolio is depreciated using the straight‑line method over the estimated remaining useful life of the properties, which generally ranges from 30 to 40 years for buildings and is 15 years for land improvements. Properties classified as held for sale are recorded at the lower of their carrying value or their fair value, less anticipated closing costs. Any properties classified as held for sale are not depreciated.

Impairment

STORE Capital reviews its real estate investments and related lease intangibles periodically for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through operations. Management considers factors such as expected future undiscounted cash flows, estimated residual

8

value, market trends (such as the effects of leasing demand and competition) and other factors including bonafide purchase offers received from third parties in making this assessment. These factors are classified as Level 3 inputs within the fair value hierarchy. An asset is considered impaired if the carrying value of the asset exceeds its estimated undiscounted cash flows and the impairment is calculated as the amount by which the carrying value of the asset exceeds its estimated fair value. Estimating future cash flows is highly subjective and such estimates could differ materially from actual results. During the three months ended March 31, 2015, the Company recorded a  provision for impairment of its real estate of $1.0 million. No impairment charges were recorded during the three months ended March 31, 2014.

Revenue Recognition

STORE Capital leases real estate to its tenants under long‑term net leases that are predominantly classified as operating leases. Direct costs associated with lease origination, offset by any lease origination fees received, are deferred and amortized over the related lease term as an adjustment to rental revenue. Substantially all of the leases are triple‑net, which provide that the lessees are responsible for the payment of all property operating expenses, including property taxes, maintenance and insurance. The Company may collect property taxes from its customers and remit those taxes to governmental authorities; such property taxes are presented on a net basis in the consolidated income statements.

The Company’s leases generally provide for rent escalations throughout the lease terms. For leases that provide for specific contractual escalations, rental revenue is recognized on a straight‑line basis so as to produce a constant periodic rent over the term of the lease. Accordingly, accrued rental revenue, calculated as the aggregate difference between the rental revenue recognized on a straight‑line basis and scheduled rents, represents unbilled rent receivables that the Company will receive only if the tenants make all rent payments required through the expiration of the lease. The Company provides an estimated reserve for uncollectible straight‑line rental revenue based on management’s assessment of the risks inherent in those lease contracts, giving consideration to industry default rates for long‑term receivables. There was $5.8 million and $4.7 million of accrued straight‑line rental revenue, net of allowances of $2.1 million and $1.7 million, at March 31, 2015 and December 31, 2014, respectively, included in other assets on the consolidated balance sheets.  Leases that have contingent rent escalators indexed to future increases in the Consumer Price Index (CPI) may adjust over a one‑year period or over multiple‑year periods. Generally, these escalators increase rent at the lesser of (a) 1 to 1.25 times the increase in the CPI over a specified period or (b) a fixed percentage. Because of the volatility and uncertainty with respect to future changes in the CPI, the Company’s inability to determine the extent to which any specific future change in the CPI is probable at each rent adjustment date during the entire term of these leases and the Company’s view that the multiplier does not represent a significant leverage factor, increases in rental revenue from leases with this type of escalator are recognized only after the changes in the rental rates have actually occurred.

For leases that have contingent rentals that are based on a percentage of the tenant’s gross sales, the Company recognizes contingent rental revenue when the threshold upon which the contingent lease payment is based is actually reached. Less than 1.5% of the Company’s investment portfolio is subject to leases that provide for contingent rent based on a percentage of the tenant’s gross sales.

The Company suspends revenue recognition if the collectibility of amounts due pursuant to a lease is not reasonably assured or if the tenant’s monthly lease payments become more than 60 days past due, whichever is earlier. The Company reviews its rent receivables for collectibility on a regular basis, taking into consideration changes in factors such as the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area where the property is located. In the event that the collectibility of a receivable with respect to any tenant is in doubt, a provision for uncollectible amounts will be established or a direct write‑off of the specific rent receivable will be made. As of March 31, 2015, the Company had a $0.3 million provision for uncollectible contractual rent payments due from tenants; there was no provision at December 31, 2014.

Loans Receivable

STORE Capital holds its loans receivable for long‑term investment. Loans receivable are carried at amortized cost, including related unamortized discounts or premiums, if any.

9

Revenue Recognition

The Company recognizes interest income on loans receivable using the effective‑interest method applied on a loan‑by‑loan basis. Direct costs associated with originating loans are offset against any related fees received and the balance, along with any premium or discount, is deferred and amortized as an adjustment to interest income over the term of the related loan receivable using the effective interest method. A loan receivable is placed on nonaccrual status when the loan has become 60 days past due, or earlier if management determines that full recovery of the contractually specified payments of principal and interest is doubtful. While on nonaccrual status, interest income is recognized only when received. As of March 31, 2015 and December 31, 2014, there were no loans on nonaccrual status.

Impairment and Provision for Loan Losses

The Company periodically evaluates the collectibility of its loans receivable, including accrued interest, by analyzing the underlying property‑level economics and trends, collateral value and quality and other relevant factors in determining the adequacy of its allowance for loan losses. A loan is determined to be impaired when, in management’s judgment based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Specific allowances for loan losses are provided for impaired loans on an individual loan basis in the amount by which the carrying value exceeds the estimated fair value of the underlying collateral less disposition costs. There was no allowance for loan losses at March 31, 2015 or December 31, 2014.

Direct Financing Receivables

Certain of the Company’s real estate investment transactions are accounted for as direct financing leases. The Company records the direct financing receivables at their net investment, determined as the aggregate minimum lease payments and the estimated residual value of the leased property less unearned income. The unearned income is recognized over the life of the related contracts so as to produce a constant rate of return on the net investment in the asset.

Cash and Cash Equivalents

Cash and cash equivalents include cash and highly liquid investment securities with maturities at acquisition of three months or less. The Company invests cash primarily in money‑market funds of a major financial institution, consisting predominantly of U.S. Government obligations.

Restricted Cash and Escrow Deposits

The Company had $2.4 million and $15.4 million of restricted cash and deposits in escrow at March 31, 2015 and December 31, 2014, respectivelywhich were included in other assets on the consolidated balance sheets.

Deferred Costs

Deferred costs consist principally of financing costs related to the issuance of the Company’s debt. Deferred financing costs are amortized as an increase to interest expense over the term of the related debt instrument using the effective interest method.  Deferred costs also include lease origination costs, which are amortized as a decrease to rental revenue over the term of the respective lease.

Derivative Instruments and Hedging Activities

The Company may enter into derivatives contracts as part of its overall financing strategy to manage the Company’s exposure to changes in interest rates associated with current and/or future debt issuances. The Company does not use derivatives for trading or speculative purposes. The Company records its derivatives on the balance sheet at fair value as either an asset or liability. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives qualifying as a hedge of the exposure to

10

variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the earnings effect of the hedged forecasted transactions in a cash flow hedge. The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income (loss). Amounts reported in accumulated other comprehensive income (loss) related to cash flow hedges are reclassified to operations as an adjustment to interest expense as interest payments are made on the hedged debt transaction.

As of March 31, 2015, the Company had entered into two interest rate swap agreements with current notional amounts of $12.6 million and $6.6 million that were designated as cash flow hedges associated with the Company’s secured, variable‑rate mortgage note payable due 2019 (Note 4).

Fair Value Measurement

The Company estimates fair value of financial and non-financial assets and liabilities based on the framework established in fair value accounting guidance.  Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The hierarchy described below prioritizes inputs to the valuation techniques used in measuring the fair value of assets and liabilities. This hierarchy maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs to be used when available. The hierarchy is broken down into three levels based on the reliability of inputs as follows:

· Level 1—Quoted market prices in active markets for identical assets and liabilities that the Company has the ability to access.

· Level 2—Significant inputs that are observable, either directly or indirectly. These types of inputs would include quoted prices for similar assets or liabilities in active markets, quoted prices for identical assets in inactive markets and market‑corroborated inputs.

· Level 3—Inputs that are unobservable and significant to the overall fair value measurement of the assets or liabilities. These types of inputs include the Company’s own assumptions.

Share‑based Compensation

Certain directors and employees of the Company have been granted long‑term incentive awards, including restricted shares and stock units of the Company’s common stock and profits interests units issued by STORE Holding, which provide them with equity interests as an incentive to remain in the Company’s service and align executives’ interests with those of the Company’s equity holders.

During the three months ended March 31, 2015, the Company granted restricted share awards (RSAs) representing 79,018 shares of restricted common stock to its executive officers and certain directors and other employees.  During the same period, 153,331 shares of restricted stock vested and 1,732 shares of restricted stock were forfeited. As of March 31, 2015, the Company had 579,861 restricted common shares outstanding. The Company estimates the fair value of RSAs at the date of grant and recognizes that amount in general and administrative expense ratably over the vesting period at the greater of the amount amortized on a straight‑line basis or the amount vested. The fair value of the RSAs is based on the per-share price of the common stock on the date of the grant. Prior to the Company’s IPO, the fair value was based on the per‑share price of the common stock issued in the Company’s private equity offerings.

In March 2015, the Company issued 348,220 restricted stock units (RSUs) with both a market condition and a service condition to its executive officers.  The number of common shares to be received at vesting will range from zero to 100% of the total RSUs grantedbased on total shareholder return (TSR) on the Company’s common stock measured against the benchmark TSR of a peer group over a three-year performance period ending December 31, 2017.  The TSR is a measure of stock price appreciation plus dividends paid during the measurement period.  To the extent market and service conditions are met, the RSUs vest 50% at the end of 2017 and, subject to continued employment, 50% at the end

11

of 2018. The Company valued the RSUs using a Monte Carlo simulation model on the date of grant which resulted in a grant date fair value of $4.4 million.  The Monte Carlo simulation was computed based on a volatility assumption of 23.51%, a risk-free interest rate of 0.84% and a dividend yield of zero. The RSUs accrue dividend equivalents which are paid only if the award vests. At March 31, 2015, there were 348,220 RSUs outstanding.

Income Taxes

As a REIT, the Company generally will not be subject to federal income tax; however, it is still subject to state and local income taxes and to federal income and excise tax on its undistributed income. STORE Investment Corporation is the Company’s wholly‑owned taxable REIT subsidiary (TRS) created to engage in non‑qualifying REIT activities. The TRS is subject to federal, state and local income taxes.

Management of the Company determines whether any tax positions taken or expected to be taken meet the “more‑likely‑than‑not” threshold of being sustained by the applicable federal, state or local tax authority. Tax returns filed for 2011 through 2014 are subject to examination by these jurisdictions. As of March 31, 2015 and December 31, 2014, management concluded that there is no tax liability relating to uncertain income tax positions. The Company’s policy is to recognize interest related to any underpayment of income taxes as interest expense and to recognize any penalties as operating expenses. There was no accrual for interest or penalties at March 31, 2015 or December 31, 2014.

Net Income Per Common Share

Net income per common share has been computed pursuant to the guidance in the FASB ASC Topic 260, Earnings Per Share. The guidance requires the classification of the Company’s unvested restricted stock, which contain rights to receive non‑forfeitable dividends, as participating securities requiring the two‑class method of computing net income per common share. The following table is a reconciliation of the numerator and denominator used in the computation of basic and diluted income per common share (dollars in thousands):

	Three Months Ended March 31,
	2015		2014
Numerator:
Net income	$	17,066	$	9,539
Less: earnings attributable to unvested restricted shares		(143)		(116)
Net income used in basic and diluted income per share	$	16,923	$	9,423
Denominator:
Weighted average common shares outstanding		115,215,833		63,436,513
Less: Weighted average number of shares of unvested restricted stock		(582,533)		(411,298)
Weighted average shares outstanding used in basic income per share		114,633,300		63,025,215
Effects of dilutive securities:
Add: Treasury stock method impact of potentially dilutive securities (a)		—		—
Weighted average shares outstanding used in diluted income per share		114,633,300		63,025,215

(a) For the three months ended March 31, 2015 and 2014, excludes 199,528 shares and 62,745 shares, respectively, related to unvested restricted shares as the effect would be antidilutive.

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or the SEC. The Company adopts the new pronouncements as of the specified effective date. When permitted, the Company may elect to early adopt the new pronouncements. Unless otherwise discussed, these new accounting pronouncements include technical corrections to existing guidance or introduce new guidance related to specialized industries or entities and therefore will have minimal, if any, impact on the Company’s financial position or results of operations upon adoption.

In May 2014, the FASB issued Accounting Standards Update (ASU) 2014‑09, Revenue from Contracts with Customers: Topic 606. This new guidance establishes a principles‑based approach for accounting for revenue from

12

contracts with customers. Lease contracts covered by Topic 840, Leases, are excluded from the scope of this new guidance. At the time of issuance, this new standard was effective for public companies for annual reporting periods beginning after December 15, 2016 and early adoption was not permitted. On April 29, 2015, the FASB issued an exposure draft regarding deferral of the effective date of the standard.  The exposure draft proposes that the effective date of the standard for public companies will be for annual reporting periods beginning after December 15, 2017 and early adoption would be permitted but only as of an annual reporting period beginning after December 15, 2016.  As leases are excluded from this guidance, the Company does not anticipate this standard to have a material impact on its financial position, results of operations and cash flows.

In April 2015, the FASB issued ASU No. 2015-03, Interest-Imputation of Interest (Subtopic 835-30) – Simplifying the Presentation of Debt Issuance Costs.  This guidance was issued to simplify the presentation of debt issuance costs by requiring debt issuance costs to be presented as a deduction from the corresponding debt liability and, therefore, make the presentation of debt issuance costs consistent with the presentation of debt discounts or premiums.  This new standard is effective for public companies for annual reporting periods beginning after December 15, 2015, with early adoption permitted.  Upon adoption, the new guidance is required to be applied retrospectively.  The Company is currently evaluating the impact of the adoption of this new standard which is expected to result in reclassifications of certain deferred costs on the Company’s balance sheets but will not have an impact on its results of operations or cash flows.

13

3. Investments

At March 31, 2015, STORE Capital had investments in 1,073 property locations representing 1,059 owned properties (of which 12 are accounted for as direct financing receivables), eight ground lease interests and six properties which secure certain mortgage loans. The gross acquisition cost of real estate investments totaled $2.95 billion at March 31, 2015. In addition, the Company held loans and direct financing receivables with an aggregate carrying amount at March 31, 2015 of $145.8 million. As of March 31, 2015, a substantial portion of these investments are assets of consolidated special purpose entity subsidiaries and are pledged as collateral under the non‑recourse obligations of these special purpose entities (Note 4).

During the three months ended March 31, 2015, the Company had the following gross real estate and loan activity (dollars in thousands):

	Number of	Dollar
	Investment	Amount of
	Locations	Investments (a)
Gross investments, December 31, 2014	947	$	2,805,911
Acquisition of and additions to real estate (b)(c)	123		256,833
Investment in loans and direct financing receivables	3		34,683
Sales of real estate	—		(48)
Principal collections on loans and direct financing receivables	—		(175)
Provision for impairment of real estate			(1,000)
Other			(11)
Gross investments, March 31, 2015 (d)			3,096,193
Less accumulated depreciation and amortization (d)			(117,733)
Net investments, March 31, 2015	1,073	$	2,978,460

(a) The dollar amount of investments includes the investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

(b) Excludes $7.4 million of tenant improvement advances disbursed in 2015 which were accrued as of December 31, 2014.

(c) Includes $0.2 million of interest capitalized to properties under construction.

(d) Includes the dollar amount of investments ($7.4 million) and the accumulated depreciation ($0.6 million) related to real estate investments held for sale at March 31, 2015.

14

The following table shows information regarding the diversification of the Company’s total investment portfolio among the different industries in which its tenants and borrowers operate as of March 31, 2015 (dollars in thousands):

				Percentage of
	Number of	Dollar		Total Dollar
	Investment	Amount of		Amount of
	Locations	Investments (a)		Investments
Restaurants	540	$	866,861	28	%
Health clubs	44		243,689	8
Early childhood education centers	121		229,183	7
Movie theaters	27		210,866	7
Sporting goods stores	15		122,693	4
Furniture stores	22		121,566	4
Colleges and professional schools	6		79,101	2
All other service industries	178		672,043	22
All other retail industries	53		223,768	7
All industrial	67		326,423	11
	1,073	$	3,096,193	100	%

(a) The dollar amount of investments includes the gross investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

Significant Credit and Revenue Concentration

STORE Capital’s real estate investments are leased or financed to 246 customers geographically dispersed throughout 46 states. Only one state, Texas (13%), accounted for 10% or more of the total dollar amount of STORE Capital’s investment portfolio at March 31, 2015. None of the Company’s 246 customers represented more than 10% of the Company’s real estate investment portfolio at March 31, 2015, with the largest customer representing less than 4% of the total investment portfolio. On an annualized basis, the largest customer also represented less than 4% of the Company’s annualized investment portfolio revenues as of March 31, 2015. The Company’s customers operate their businesses across 227 concepts and none of these concepts represented more than 4% of the Company’s annualized investment portfolio revenues as of March 31, 2015.

Intangible Lease Assets

The following details intangible lease assets and related accumulated amortization (in thousands):

	March 31,		December 31,
	2015		2014
In-place lease assets	$	52,017	$	47,359
Above-market lease assets		10,273		5,526
Ground lease interest assets		7,299		7,299
Total intangible lease assets		69,589		60,184
Accumulated amortization		(7,606)		(6,006)
Net intangible lease assets	$	61,983	$	54,178

15

Aggregate lease intangible amortization included in expense was $1.4 million and $0.8 million during the three months ended March 31, 2015 and 2014, respectively. The amount amortized as a decrease to rental revenue for capitalized above‑market lease intangibles was $231,000 for the three months ended March 31, 2015.

Based on the balance of the intangible assets at March 31, 2015, the aggregate amortization expense is expected to be $3.9 million for the remainder of 2015, $5.1 million in 2016, $5.0 million in 2017, $4.8 million in 2018, $4.6 million in 2019 and $4.1 million in 2020 and the amount expected to be amortized as a decrease to rental revenue is expected to be $0.9 million for the remainder of 2015 and $1.2 million in each of the nextfiveyears. The weighted average remaining amortization period is approximately 11 years for the in‑place lease intangibles, approximately nine years for the above‑market lease intangibles and approximately 75 years for the amortizing ground lease interests.

Real Estate Investments

The Company’s investment properties are leased to tenants under long‑term operating leases that typically include one or more renewal options. The weighted average remaining noncancelable lease term at March 31, 2015 was approximately 15 years. Substantially all of the leases are triple‑net, which provide that the lessees are responsible for the payment of all property operating expenses, including property taxes, maintenance and insurance; therefore, STORE Capital is generally not responsible for repairs or other capital expenditures related to the properties. At March 31, 2015, all of the properties were subject to a lease.

Scheduled future minimum rentals to be received under the remaining noncancelable term of the operating leases at March 31, 2015, are as follows (in thousands):

Remainder of 2015	$	186,836
2016		249,820
2017		249,906
2018		250,041
2019		250,203
2020		248,557
Thereafter		2,278,194
Total future minimum rentals (a)	$	3,713,557

(a) Includes $43.2 million (approximately $3.6 million annually through February 2027) of future rentals associated with two leases terminated subsequent to March 31, 2015.

Since lease renewal periods are exercisable at the option of the lessee, the preceding table presents future minimum lease payments due during the initial lease term only. In addition, the future minimum lease payments do not include any contingent rentals such as lease escalations based on future changes in CPI.

Loans and Direct Financing Receivables

At March 31, 2015, the Company held 11 loans receivable with an aggregate carrying amount of $95.8 million and had $50.0 million of investments in transactions accounted for as direct financing leases. Ten of the loans are mortgage loans secured by land and/or buildings and improvements on the mortgaged property. The other loan is secured by a tenant’s equipment.

Two of the mortgage loans are short‑term loans and require monthly interest‑only payments with balloon payments at maturity. The remaining mortgage loans receivable generally require the borrowers to make monthly principal and interest payments based on a 40‑year amortization period with balloon payments, if any, at maturity. The other secured loan requires the borrower to make monthly interest‑only payments with a balloon payment at maturity.

16

The Company’s loans and direct financing receivables are summarized below (dollars in thousands):

	Stated
	Interest		Maturity	March 31,		December 31,
Type	Rate		Date	2015		2014
Mortgage loan receivable	8.50	%	Apr. 2015	$	4,300	$	4,300
Mortgage loan receivable	9.09	%	Jan. 2017		1,933		1,933
Mortgage loan receivable	8.35	%	Jan. 2028		3,772		3,775
Mortgage loan receivable	8.75	%	Jul. 2032		23,969		23,998
Mortgage loan receivable	7.45	%	Jan. 2035		500		—
Mortgage loan receivable	9.00	%	Mar. 2053		14,580		14,595
Mortgage loan receivable	8.75	%	Jun. 2053		6,352		6,357
Mortgage loan receivable	8.50	%	Jun. 2053		6,691		6,697
Mortgage loan receivable	8.25	%	Aug. 2053		3,335		3,337
Mortgage loan receivable (a)	8.50	%	Feb. 2055		28,500		—
Total mortgage loans receivable					93,932		64,992
Equipment loan receivable					—		94
Equipment loan receivable	7.75	%	Mar. 2017		1,063		—
Total principal amount outstanding—loans receivable					94,995		65,086
Unamortized loan origination costs					883		497
Direct financing receivables					49,972		45,771
Total loans and direct financing receivables				$	145,850	$	111,354

(a) Mortgage loan receivable has an initial interest rate of 8.50%and is subject to increasesover the term of the loan.  The loan allows for prepayment in whole, but not in part, with penalties ranging from 20% to 70% depending on the timing of the prepayment.

The long‑term mortgage loans receivable generally allow for prepayments in whole, but not in part, without penalty or with penalties typically ranging from 1% to 5%, depending on the timing of the prepayment, except as noted in the table above. All other loans receivable allow for prepayments in whole or in part without penalty. Absent prepayments, scheduled maturities are expected to be as follows (in thousands):

	Scheduled		Balloon		Total
	Principal		Payments		Payments
Remainder of 2015	$	233	$	4,300	$	4,533
2016		332		—		332
2017		361		2,996		3,357
2018		394		—		394
2019		429		—		429
2020		449		—		449
Thereafter		61,632		23,869		85,501
Total principal repayments	$	63,830	$	31,165	$	94,995

The components of the investments accounted for as direct financing receivables as of March 31, 2015 were as follows (in thousands):

Minimum lease payments receivable	$	129,018
Estimated residual value of leased assets		5,076
Unearned income		(84,122)
Net investment	$	49,972

17

4. Debt

Credit Facilities

In September 2014, the Company entered into a new $300 million unsecured revolving credit facility with a group of lenders which replaced the Company’s previous two secured credit facilities that aggregated $300 million. The  facility is used to partially fund real estate acquisitions pending the issuance of long-term, fixed-rate debt.

This facility, which includes an accordion feature that allows the size of the facility to be increased up to $500 million, is for an initial term of three years andincludes a one-year extension option subject to certain conditions and the payment of a 0.2% extension fee. The facility is recourse to the Company and includes a guaranty from STORE Capital Acquisitions, LLC, one of the Company’s direct wholly-owned subsidiaries. Borrowings under this facility require monthly payments of interest at a rate selected by the Company of either (1) one-month LIBOR plus a credit spread ranging from 1.75% to 2.50%, or (2) theBase Rate, as defined in the agreement, plus a credit spread ranging from 0.75% to 1.50%. The credit spread used is based on the Company’s leverage ratio as defined in the agreement; based on the most recent leverage ratio calculations, borrowings under the facility made on or after April 1, 2015 will bear interest at one-month LIBOR plus 1.75%. The Company must also pay a 0.25% non-use fee on the unused portion of the facility. Borrowing availability under the facility is limited to 50% of the value of the Company’s eligible unencumbered assets at any point in time. At March 31, 2015, the Company had $162 million of borrowings outstanding and a pool of eligible unencumbered assets aggregating approximately $1.1billion.

The Company is subject to various financial and nonfinancial covenants under this unsecured credit facility including a maximum leverage of 65%,  a  minimum EBITDA to fixed charges ratio of 1.5 to 1, minimum consolidated net worth of $600 million plus 75% of additional equity raised after September 2014, and a maximum dividend payout ratio limited to 95% of Funds from Operations, all as defined in the agreement. As of March 31, 2015, the Company was in compliance with these covenants.

On April 8, 2015, the Company entered into a four-month (including theone-month extension option),  $50million unsecured loan facility with a bank as a temporary supplement to borrowing capacity under its unsecured revolving credit facility.  This loan facilityis subject to the same borrowing limitations and covenants as the unsecured revolving credit facility discussed above.Borrowings under this loan facility require monthly payments of interest at a rate selected by the Company of either (1) one-month LIBOR plus 2.00%, or (2) the Base Rate, as defined in the agreement.  

Prior to September 19, 2014, the Company had two bank credit facilities that were secured by real estate properties which were pledged as collateral under the facilities as well as the Company’s equity interests in certain of its special purpose entity subsidiaries and the Company’s holdings of the Class B notes issued under its STORE Master Funding debt program (see below). These previous secured credit facilities bore interest atone-month LIBOR plus a credit spread ranging from2.45% to 3.00%.

The financing costs related to the establishment of the Company’s credit facilities are deferred and amortized to interest expense over the term of the credit facilities. At March 31, 2015 and December 31, 2014, unamortized financing costs related to the Company’s credit facilitytotaled $2.1 million and $2.4 million, respectively.

18

Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities

During 2012, the Company implemented a debt issuance program pursuant to which certain of its consolidated special purpose entities issue multiple series of non‑recourse net‑lease mortgage notes from time to time that are collateralized by the assets owned by these entities and their related leases (collateral). One of the principal features of the program is that, as additional series of notes are issued, new collateral is contributed to the collateral pool thereby increasing the size and diversity of the collateral pool for the benefit of all noteholders, including those who invested in prior series. Another feature of the program is the ability to substitute collateral from time to time subject to meeting certain prescribed conditions and criteria. The notes are generally segregated into Class A amortizing notes and Class B non‑amortizing notes. The Company has retained each of the Class B notes which aggregate $78.0 million at March 31, 2015.

The Class A notes require monthly principal and interest payments with a balloon payment due at maturity and these notes may be prepaid at any time, subject to a yield maintenance prepayment premium. As of March 31, 2015, the aggregate collateral pool securing the net‑lease mortgage notes is comprised primarily of single tenant commercial real estate properties with an aggregate investment amount of approximately $1.6 billion.

On April 16, 2015, the consolidated special purpose entities issued an additional series of net-lease mortgage notes consisting of $365.0 million of Class A notes and $30.0 million of Class B notes.  The Class A notes are segregated into two tranches:  $95.0 million of seven-year notes with an interest rate of 3.75% and $270.0 million of ten-year notes with an interest rate of 4.17%.  The Class B notes were retained by the Company.

A number of additional consolidated special purpose entity subsidiaries of the Company have financed their owned real estate properties with traditional first mortgage debt. The notes require monthly principal and interest payments with balloon payments at maturity. In general, these mortgage notes payable can be prepaid in whole or in part upon payment of a yield maintenance premium. The mortgage notes payable are collateralized by real estate properties owned by these consolidated special purpose entity subsidiaries with an aggregate investment amount of approximately $327.3 million at March 31, 2015.

The mortgage notes payable, which are obligations of the consolidated special purpose entities as described in Note 2, contain various covenants customarily found in mortgage notes, including a limitation on the issuing entity’s ability to incur additional indebtedness on the underlying real estate. Although this mortgage debt generally is non‑recourse, there are customary limited exceptions to recourse for matters such as fraud, misrepresentation, gross negligence or willful misconduct, misapplication of payments, bankruptcy and environmental liabilities. Certain of the mortgage notes payable also require the posting of cash reserves with the lender or trustee if specified coverage ratios are not maintained by the Company or one of its tenants.As of March 31, 2015, the Company had one variable-rate mortgage note (outstanding principal balance of $19.2 million) which had effectively been converted to a fixed-rate note through the use of two interest rate swaps.The Company has an agreement with thecounterparty to the interest rate swaps which contains a provision that, if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, the Company could also be declared in default on its interest rate swap obligations. As of March 31, 2015, the termination value of the Company’s interest rate swaps was a liability of approximately $0.5million.

Financing costs related to the issuance of the non‑recourse debt obligations are deferred and amortized to interest expense over the terms of the related notes. As of March 31, 2015 and December 31, 2014, unamortized financing costs related to all non‑recourse debt obligations of the consolidated special purpose entities totaled $30.1 million and $30.9 million, respectively.

19

The non‑recourse debt obligations of the consolidated special purpose entity subsidiaries are summarized below (dollars in thousands):

		Coupon		Outstanding Balance
	Maturity	Interest		March 31,		December 31,
	Date	Rate		2015		2014
Non-recourse net-lease mortgage notes:
Series 2012-1, Class A	Aug. 2019	5.77	%	$	206,698	$	207,503
Series 2013-1, Class A-1	Mar. 2020	4.16	%		145,259		145,876
Series 2013-2, Class A-1	Jul. 2020	4.37	%		104,324		104,740
Series 2013-3, Class A-1	Nov. 2020	4.24	%		75,473		75,767
Series 2014-1, Class A-1	Apr. 2021	4.21	%		119,500		119,650
Series 2013-1, Class A-2	Mar. 2023	4.65	%		98,776		99,196
Series 2013-2, Class A-2	Jul. 2023	5.33	%		94,574		94,951
Series 2013-3, Class A-2	Nov. 2023	5.21	%		98,016		98,398
Series 2014-1, Class A-2	Apr. 2024	5.00	%		139,417		139,592
Non-recourse mortgage notes payable:
$21,443 note issued July 2005 (a)	Aug. 2015	5.26	% (a)		18,849		18,956
$4,000 note issued August 2006 (b)	Sept. 2016	6.33	% (b)		3,299		3,326
$3,800 note issued September 2006 (c)	Oct. 2016	6.47	% (c)		3,498		3,512
$7,088 note issued April 2007 (d)	May 2017	6.00	% (d)		6,648		6,676
$4,400 note issued August 2007 (e)	Sept. 2017	6.7665	% (e)		3,780		3,807
$8,000 note issued January 2012; assumed in December 2013	Jan. 2018	4.778	%		7,444		7,511
$20,530 note issued December 2011 and amended February 2012	Jan. 2019	5.275	% (f)		19,202		19,317
$6,500 note issued December 2012	Dec. 2019	4.806	%		6,170		6,207
$2,956 note issued June 2013	Jun. 2020	3.173	% (g)		2,812		2,827
$16,100 note issued February 2014	Mar. 2021	4.83	%		15,771		15,857
$13,000 note issued May 2012	May 2022	5.195	%		12,253		12,326
$14,950 note issued July 2012	Aug. 2022	4.95	%		13,774		13,863
$26,000 note issued August 2012	Sept. 2022	5.05	%		24,660		24,805
$6,400 note issued November 2012	Dec. 2022	4.71	%		6,090		6,127
$11,895 note issued March 2013	Apr. 2023	4.73	%		11,410		11,478
$17,500 note issued August 2013	Sept. 2023	5.46	%		17,003		17,091
$10,075 note issued March 2014	Apr. 2024	5.10	%		9,947		9,984
$7,750 note issued February 2013	Mar. 2038	4.81	% (h)		7,424		7,468
$6,944 notes issued March 2013	Apr. 2038	4.50	% (i)		6,643		6,684
					1,278,714		1,283,495
Unamortized net premium					506		656
Total non-recourse debt obligations of consolidated special purpose entities				$	1,279,220	$	1,284,151

(a) Note was assumed in June 2014 at a premium; estimated effective yield at assumption of 3.69%.

(b) Note was assumed in July 2012 at a premium; estimated effective yield at assumption of 5.15%.

(c) Note was assumed in April 2014 at a premium; estimated effective yield at assumption of 3.88%.

(d) Note was assumed in December 2013 at a premium; estimated effective yield at assumption of 4.45%.

(e) Note was assumed in September 2014 at a premium; estimated effective yield at assumption of 3.40%.

(f) Note is a variable‑rate note which resets monthly at one‑month LIBOR + 3.50%. The Company has entered into two interest rate swap agreements that effectively convert the floating rate on a $12.6 million portion and a $6.6 million portion of this mortgage note payable to fixed rates of 5.299% and 5.230%, respectively (Note 2).

(g) Note is a variable‑rate note which resets monthly at one‑month LIBOR + 3.00%; rate shown is effective rate at March 31, 2015.

(h) Interest rate is effective for first 10 years and will reset to greater of (1) initial rate plus 400 basis points or (2) Treasury rate plus 400 basis points.

(i) Interest rate is effective for first 10 years and will reset to the lender’s then prevailing interest rate.

20

As of March 31, 2015, the scheduled debt maturities, including balloon payments, during the next five years and thereafter are as follows (in thousands):

	Scheduled		Balloon
	Principal		Payments		Total
Remainder of 2015	$	14,408	$	18,710	$	33,118
2016		19,789		6,549		26,338
2017		20,517		9,921		30,438
2018		21,070		6,665		27,735
2019		19,765		213,539		233,304
2020		13,942		295,985		309,927
Thereafter		36,906		580,948		617,854
	$	146,397	$	1,132,317	$	1,278,714

5. Stockholders’ Equity

On November 3, 2014, the Company’s board of directors declared a 1.67‑for‑one split of its common stock effected through a dividend to its stockholders. The stock dividend was treated as a stock split for accounting purposes; the $0.01 par value of the common stock was unchanged. The Company declared dividends payable to common stockholders totaling $28.8 million and $15.1 million during the three months ended March 31, 2015 and 2014, respectively.

On March 30, 2015, STORE Holding redeemed all of itsSeries A membership interests that were held by members of the Company’s board and senior management through the distribution of 653,382common shares of the Company to those members.  STORE Holding held 82,148,644of the Company’s common shares at March 31, 2015 and 82,802,026 common shares at December 31, 2014.

6. Income from Discontinued Operations

Periodically, the Company may sell real estate properties it owns. Effective January 1, 2014, the Company adopted ASU No. 2014‑08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (ASU 2014‑08),under which only disposals representing a strategic shift in operations of the Company and that have (or will have) a major effect on the Company’s operations and financial results are to be presented as discontinued operations. The Company was required to continue to classify any property disposal or property classified as held for sale as of December 31, 2013 as discontinued operations prospectively; therefore, the gains and losses from these property dispositions and all operations from these properties were reclassified to discontinued operations, net of any related income tax, in the consolidated statements of income. This presentation has no impact on net income or cash flow. The Company did not classify any additional property disposals as discontinued operations subsequent to December 31, 2013.

Amounts reclassified to discontinued operations during the three months ended March 31, 2014 included $103,000 of income from real estate operations and $743,000 of gain on disposition of properties relatedto assets that had been classified as held for sale prior to the Company’s adoption of ASU 2014‑08.

7. Commitments and Contingencies

In the normal course of business, the Company enters into various types of commitments to purchase real estate properties. These commitments are generally subject to the Company’s customary due diligence process and, accordingly, a number of specific conditions must be met before the Company is obligated to purchase the properties. At the time the Company purchases a property, the Company may also agree to fund future improvements to the property.

21

As of March 31, 2015, the Company had approximately $39.0 million in commitments to fund improvements to real estate properties previously acquired which will generally result in increases to the rental revenue due under the related contracts.

The Company has employment agreements with each of its executive officers which will expire in November 2018.  The agreements provide for minimum annual base salaries and annual incentive compensation based on the satisfactory achievement of reasonable performance criteria and objectives to be adopted by the Company’s Board of Directors each year.  In addition, each officer is eligible to receive equity awards as determined by the Company’s Board of Directors. In the event an executive officer is terminated without cause or terminates employment for good reason, the Company is liable for a lump‑sum severance payment in an amount equal to, in the case of the Company’s Chief Executive Officer, the sum of (i) two times his base salary and (ii) two times the target cash bonus for which he was eligible in the prior fiscal year (whether or not received); and, in the case of the Company’s other executive officers, the sum of (i) 1.5 times his or her base salary and (ii) 1.5 times the target cash bonus for which he or she was eligible in the prior fiscal year (whether or not received); plus, in the case of all executive officers, certain other specified termination benefits.  In the event of a termination without cause, as defined in the employment agreements, the executive officer is entitled to immediate vesting of any and all outstanding unvested shares of the Company’s restricted stock that he or she has been awarded as part of the Company’s incentive compensation program.  For unvested RSUs, in the event of a qualified termination, as defined in the award agreement, the executive officer is entitled to a portion of any earned award, as determined under the award agreement, based on the elapsed performance period.

8. Fair Value of Financial Instruments

The Company’s derivatives are required to be measured at fair value in the Company’s consolidated financial statements on a recurring basis.  Derivatives are measured under a market approach, using prices obtained from a nationally recognized pricing service and pricing models with market observable inputs such as interest rates and equity index levels. These measurements are classified as Level 2 within the fair value hierarchy. The fair value of the Company’s derivatives  (interest rate swaps) at March 31, 2015 and December 31, 2014 was a liability of $417,000 and $266,000, respectively, included in other liabilities on the consolidated balance sheets.

In addition to the disclosures for assets and liabilities required to be measured at fair value at the balance sheet date, companies are required to disclose the estimated fair values of all financial instruments, even if they are not carried at their fair value. The fair values of financial instruments are estimates based upon market conditions and perceived risks at March 31, 2015 and December 31, 2014. These estimates require management’s judgment and may not be indicative of the future fair values of the assets and liabilities.

Financial assets and liabilities for which the carrying values approximate their fair values include cash and cash equivalents, restricted cash and escrow deposits, accounts receivable, accounts payable and tenant deposits. Generally these assets and liabilities are short‑term in duration and are recorded at fair value on the consolidated balance sheets. The Company believes that the carrying value of borrowings under its credit facility approximate fair value based upon their nature, terms and variable interest rate. Additionally, the Company believes the carrying values of its fixed‑rate loans receivable approximate fair values based on market quotes for comparable instruments or discounted cash flow analysis using estimates of the amount and timing of future cash flows, market rates and credit spreads.

The estimated fair values of the non‑recourse debt obligations of consolidated special purpose entities have been derived based on market observable inputs such as interest rates and discounted cash flow analyses using estimates of the amount and timing of future cash flows, market rates and credit spreads. These measurements are classified as Level 2 within the fair value hierarchy. At March 31, 2015, the Company’s non‑recourse debt obligations of consolidated special purpose entities had a carrying value of $1,279.2 million and an estimated fair value of $1,377.7 million. At December 31, 2014, these debt obligations had a carrying value of $1,284.2 million and an estimated fair value of $1,349.0 million.

22

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Special Note Regarding Forward Looking Statements

This quarterly report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  Such forward-looking statements include, without limitation, statements concerning our business and growth strategies, investment, financing and leasing activities and trends in our business, including trends in the market for long-term, triple-net leases of freestanding, single-tenant properties.  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 which 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 quarterly 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 “Item 1A.Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2014 filed with the Securities and Exchange Commission on March 10, 2015.

Forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this quarterly report, and 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.

Overview

We were formed in 2011 to invest in and manage Single Tenant Operational Real Estate, or STORE Properties, which is our target market and the inspiration for our name.  A STORE Property is a property location at which a company operates its business and generates sales and profits, which makes the location a profit center and, therefore, fundamentally important to that business. Examples of operational real estate include restaurants, early childhood education centers, health clubs, movie theaters, sporting goods stores, furniture stores and colleges and professional schools.  By acquiring the real estate from the operators and then leasing the real estate back to them, they become our long‑term tenants, and we refer to them as our customers. We provide a source of long‑term capital to our customers by enabling them to avoid the need to incur debt and employ equity in order to finance the real estate that is essential to their business.

We are a Maryland corporation organized as an internally managed real estate investment trust, or REIT.  As a REIT, we will generally not be subject to federal income tax to the extent that we distribute all of our taxable income to our stockholders and meet other requirements. 

The growth of our Company from inception in May 2011 until November 2014 was funded by STORE Holding Company, LLC, or STORE Holding, a Delaware limited liability company, all of which is owned, directly or indirectly, by certain investment funds managed by Oaktree Capital Management, L.P.  In November 2014, we took the Company public on the New York Stock Exchange and now our common stock trades under the ticker symbol “STOR”.  STORE Holding is still our primary stockholder, owning approximately 71% of our outstanding common stock as of March 31, 2015. In November 2014, prior to our initial public offering, or IPO, our board of directors declared a stock split effected through the distribution of 1.67 shares for each share of common stock then outstanding; accordingly, all share and per share information included in this report has been retroactively restated to take into account the effect of the stock split.

Since our inception in 2011, we have selectively originated a real estate investment portfolio totaling $3.1 billion, consisting of investments in 1,073 property locations across 46 states as of March 31, 2015. All of the real estate we acquire is held by our wholly-owned subsidiaries, many of which are special purpose bankruptcy remote entities formed to facilitate the financing of our real estate. We predominantly acquire our single‑tenant properties directly from our customers in sale‑leaseback transactions where our customers sell us their operating properties and then

23

simultaneously enter into long‑term triple‑net leases with us to lease the properties back. Accordingly, our properties are fully occupied and under lease from the moment we acquire them.

We generate our cash from operations primarily through the monthly lease payments, or “base rent”, we receive from our customers under their long‑term leases with us. We also receive interest payments on loans receivable, which are a small part of our portfolio. We refer to the monthly scheduled lease and interest payments due from our customers as “base rent and interest”. Most of our leases contain lease escalations every year or every several years that are based on the lesser of the increase in the Consumer Price Index, or CPI, or a stated percentage (if expressed on an annual basis, currently averaging approximately 1.7%), which allows the monthly lease payments we receive to rise somewhat in an inflationary economic environment. As of March 31, 2015, approximately 97% of our leases (based on annualized base rent) are referred to as “triple net”, which means that our customer is responsible for all of the maintenance, insurance and property taxes associated with the properties they lease from us, including any increases in those costs that may occur as a result of inflation. The remaining leases have some landlord responsibilities, generally related to maintenance and structural component replacement that may be required on such properties in the future, although we do not currently anticipate incurring significant capital expenditures or property costs under such leases. Since our properties are single‑tenant properties under long‑term leases, it is not necessary for us to perform any significant ongoing leasing activities on our properties. As of March 31, 2015, the weighted average remaining term of our leases (calculated based on annualized base rent) was approximately 15 years, excluding renewal options, which are exercisable at the option of our tenants upon expiration of their base lease term. Leases approximating 98% of our base rent as of that date provide for tenant renewal options (generally two to four five‑year options) and leases approximating 6% of our base rent provide our tenant the option, at their election, to purchase the property from us at a specified time or times (generally at the greater of the then‑fair market value or our cost).

Liquidity and Capital Resources

At the beginning of 2015, our real estate investment portfolio totaled $2.8 billion, consisting of investments in 947 property locations with base rent and interest due from our customers aggregating approximately $19.8 million per month, excluding future rent payment escalations. By March 31, 2015, our investment portfolio had grown to $3.1 billion, consisting of investments in 1,073 property locations with base rent and interest aggregating approximately $21.9 million per month. Substantially all of our cash from operations is generated by our real estate portfolio.

Our primary cash expenditures are the monthly principal and interest payments we make on the debt we use to finance our real estate investment portfolio and the general and administrative expenses of servicing the portfolio and operating our business. Since substantially all of our leases are triple net, our tenants are generally responsible for the maintenance, insurance and property taxes associated with the properties they lease from us.  When a property becomes vacant through a tenant default or expiration of the lease term with no tenant renewal, we would incur these property costs during the time it would take to locate a substitute tenant.  Also, we will occasionally incur nominal property‑level expenses that are not paid by our customers, such as the costs of periodically making site inspections of our properties. As of March 31, 2015, our portfolio was 100% occupied and leases on only four properties are scheduled to expire during the remainder of 2015, representing less than one-third of one percent of our annualized base rent and interest.  In April 2015, leases associated with two of these four properties were renewed by the tenant.  As of May 1, 2015, six of our properties were vacant and not subject to a lease. Accordingly, we expect that our property costs will be at an elevated level, as compared to our historical experience, during the period that these vacant properties are being remarketed.

We intend to continue to grow primarily through additional real estate investments. To accomplish this objective, we must continue to identify real estate acquisitions which are consistent with our underwriting guidelines and raise future additional capital. We acquire real estate with a combination of debt and equity capital and with cash from operations that is not otherwise distributed to our stockholders. 

Our debt capital is provided on a temporary basis through our variable‑rate unsecured revolving credit facility with a group of banks, until our short-term borrowings are sufficiently large to enable the economic issuance of long-term fixed-rate notes from our Master Funding program. We also, from time to time, obtain fixed-rate non‑recourse mortgage financing from banks and insurance companies secured by specific property we pledge as collateral. By matching the expected cash inflows from our long‑term real estate leases with the expected cash outflows of our

24

long‑term fixed‑rate debt, we “lock in”, for as long as is economically feasible, the expected positive difference between our scheduled cash inflows on the leases and the cash outflows on our debt payments. By “locking in” this difference, or “spread”, we seek to reduce the risk that increases in interest rates would adversely impact our profitability. In addition, we may use various financial instruments designed to mitigate the impact of interest rate fluctuations on our cash flows and earnings, including hedging strategies such as interest rate caps, depending on our analysis of the interest rate environment and the costs and risks of such strategies. We target a level of debt within a range of six to seven times our earnings before interest, taxes, depreciation and amortization.

The availability of debt to finance commercial real estate in the United States can, at times, be impacted by economic and other factors that are beyond our control. An example of this is the period during the recession of 2007 to 2009 when availability of debt capital for commercial real estate was significantly curtailed. We seek to reduce the risk that long‑term debt capital may be unavailable to us by limiting the period between the time we acquire our real estate and the time we finance our real estate with long‑term debt. In addition, we have arranged our short‑term debt facility (described below) to have a multi‑year term in order to reduce the risk that short‑term real estate financing would not be available to us. As we grow our real estate portfolio, we also intend to manage our debt maturities to reduce the risk that a significant amount of our debt will mature in any single year in the future. As of March 31, 2015, we had no significant near-term debt maturities, with balloon payments due during the remainder of 2015 representing just $19 million, or 1.5%, of our total long-term debt, and our weighted average debt maturity is approximately seven years. As our outstanding debt matures, we may refinance this maturing debt as it comes due or choose to repay it using cash and cash equivalents or our revolving credit facility. Because our long-term debt generally requires monthly payments of principal, in addition to the monthly interest payments, the resulting principal amortization reduces our refinancing risk upon maturity of the debt. The long-term debt we have issued as of March 31, 2015 is comprised, almost exclusively, of secured non-recourse borrowings with a weighted average loan-to-cost ratio of 67% and approximately 61% of our portfolio serves as collateral for this long-term debt.  The remaining portfolio properties, aggregating almost $1.2 billion, are unencumbered and this unencumbered pool of properties provides us flexibility for future borrowings or as substitute collateral for existing indebtedness. 

We raise debt capital through several different markets, including the asset‑backed and commercial mortgage‑backed securities markets, as well as the market for term debt financing. We believe that having access to multiple debt markets increases our financing flexibility because different debt markets may attract different debt investors, thus increasing our access to a potentially larger pool of debt investors. Also, a particular debt market may be more competitive than another at any particular point in time. In addition to these sources of debt capital, our senior leadership team has prior experience with senior secured lines of credit and senior unsecured term debt, which may be deployed as we continue to grow the business and implement our asset‑liability management strategies.

Typically, we use our short‑term unsecured credit facility to acquire our real estate properties, until those borrowings are sufficiently large to warrant the economic issuance of term notes under our Master Funding conduit, the proceeds from which we use to repay the amounts outstanding under our credit facility. In September 2014, we entered into a $300 million unsecured revolving credit facility with a group of lenders, which replaced our two previous secured credit facilities. This facility, which includes an accordion feature that allows the size of the facility to be increased up to $500 million, is for an initial term of three years and includes a one‑year extension option subject to certain conditions and the payment of a 20 basis point extension fee. The facility bears interest at a rate selected by us equal to either one‑month LIBOR plus a leverage‑based credit spread ranging from 1.75% to 2.50%, or a Base Rate, as defined in the debt agreement, plus a leverage‑based credit spread ranging from 0.75% to 1.50%, and also includes a fee of 0.25% assessed on the average unused portion of the facility. Availability under the facility is limited to 50% of the value of our eligible unencumbered assets at any point in time. At March 31, 2015, we had $162 million of borrowings outstanding on this credit facility and we had a pool of unencumbered assets aggregating approximately $1.2 billion, substantially all of which is eligible as collateral under the credit facility.  Covenants under this facility include: maximum leverage of 65%, minimum fixed charge coverage of 1.5x, minimum net worth of $600 million plus 75% of new net equity proceeds, and a maximum dividend payout ratio limited to 95% of Funds from Operations, all as defined in the agreement. The facility is recourse to us and includes a guaranty from STORE Capital Acquisitions, LLC, one of our direct wholly‑owned subsidiaries. We remain in compliance with these covenants.

25

As of March 31, 2015, essentially all of our long‑term debt was fixed‑rate debt, or was effectively converted to a fixed‑rate for the term of the debt. Our primary long‑term debt funding option is STORE Master Funding, which we began to use in 2012. As summarized below, a large portion of our real estate investment portfolio serves as collateral for outstanding borrowings under this debt program. Through this debt program, we arrange for bankruptcy remote, special purpose entity subsidiaries to issue multiple series of investment‑grade asset‑backed net‑lease mortgage notes, or ABS notes, from time to time as additional collateral is added to the collateral pool. The ABS notes are generally issued to institutional investors through the asset‑backed securities market. These ABS notes are issued in two classes, Class A and Class B. The Class A notes, which represent approximately 70% of the appraised value of the underlying real estate collateral, are currently rated A+ by Standard & Poor’s Ratings Services. The Class A notes generally require monthly payments of principal and interest with balloon payments due at their respective maturity dates, either seven or 10 years from the date of issuance. We have historically retained the Class B notes, which are subordinated to the Class A notes as to principal repayment. The Class B notes, currently rated BBB by Standard & Poor’s Rating Services, aggregate $78.0 million in principal amount outstanding at March 31, 2015 and are held by one of our bankruptcy remote, special purpose entity subsidiaries. The Class B notes are not reflected in our financial statements because they eliminate in consolidation. Since these Class B notes are issued and outstanding, they provide us with additional financial flexibility in that we may sell them to a third party in the future or use them as collateral for short‑term borrowings as we have done from time to time in the past.

The ABS notes outstanding at March 31, 2015 totaled $1.1 billion in Class A principal amount supported by a collateral pool valued at $1.6 billion representing 647 property locations operated by 146 customers. The amount of debt that can be issued in any new series is determined by the structure of the transaction and the amount of collateral that has been added to the pool. In addition, the issuance of each new series of notes is subject to the satisfaction of several conditions, including that there is no event of default on the existing note series and that the issuance will not result in an event of default on, or the credit rating downgrade of, the existing note series.

On April 16, 2015, our consolidated special purpose entities issued an additional series of STORE Master Funding net-lease mortgage notes consisting of $365.0 million of Class A notes and $30.0 million of Class B notes.  The Class A notes are segregated into two tranches:  $95.0 million of 7-year notes with an interest rate of 3.75% and $270.0 million of 10-year notes with an interest rate of 4.17%.  The Class B notes were retained by us.  The net proceeds from the issuance of the net-lease mortgage notes were used to pay-off the then-existing outstanding balances on our credit facilities and provided liquidity to continue to acquire real estate assets.

A significant portion of our cash flows are generated by the special purpose entities comprising our Master Funding debt program. For the twelve months ended March 31, 2015, excess cash flow, after payment of debt service and servicing and trustee expenses, totaled $55 million on cash collections of $128 million, which represents an overall ratio of cash collections to debt service of approximately 1.7 to 1 on the Master Funding program. If at any time the debt service coverage ratio (as defined in the program documents) generated by the collateral pool is less than 1.3 to 1, excess cash flow from the Master Funding entities will be deposited into a reserve account to be used for payments to be made on the net‑lease mortgage notes, to the extent there is a shortfall. We anticipate that the debt service coverage ratio for the Master Funding program will remain well above program minimums.

To complement STORE Master Funding, we also obtain debt in discrete transactions through other bankruptcy remote, special purpose entity subsidiaries, which debt is solely secured by specific real estate assets and is generally non‑recourse to us (subject to certain customary limited exceptions). These discrete borrowings are generally in the form of traditional mortgage notes payable, with principal and interest payments due monthly and balloon payments due at their respective maturity dates, which typically range from seven to 10 years from the date of issuance. We generally obtain discrete secured borrowings from institutional commercial mortgage lenders, who subsequently securitize (that is, sell) the loans within the commercial mortgage‑backed securities, or CMBS, market. We have also occasionally used similar types of financing from insurance companies and commercial banks. Our secured borrowings contain various covenants customarily found in mortgage notes, including a limitation on the issuing entity’s ability to incur additional indebtedness on the underlying real estate. Certain of the notes also require the posting of cash reserves with the lender or trustee if specified coverage ratios are not maintained by the special purpose entity or the tenant.

26

As of March 31, 2015, the long‑term, non‑recourse debt of our consolidated special purpose entities had an aggregate outstanding principal balance of approximately $1.3 billion, a weighted average maturity of 6.6 years and a weighted average interest rate of 4.89%.  The following is a summary of the outstanding balance of our borrowings as well as a summary of the portion of our real estate investment portfolio that is either pledged as collateral for these borrowings or is unencumbered as of March 31, 2015:

			Gross Investment Amount
			Special Purpose
	Outstanding		Entity		All Other
(In millions)	Borrowings		Subsidiaries		Subsidiaries		Total
STORE Master Funding net-lease mortgage notes payable	$	1,082	$	1,573	$	—	$	1,573
Other mortgage notes payable		197		327		—		327
Total long-term debt		1,279		1,900		—		1,900
Short-term debt - unsecured credit facility		162		—		—		—
Unencumbered real estate assets		—		864		332		1,196
	$	1,441	$	2,764	$	332	$	3,096

Our decision to use STORE Master Funding or non‑recourse traditional mortgage loan borrowings depends on borrowing costs, debt terms, debt flexibility and the tenant and industry diversification levels of the collateral pool. As we continue to acquire real estate, we expect to balance the overall degree of leverage on our portfolio by growing a pool of portfolio assets that are unencumbered. A growing pool of unencumbered assets will increase our financial flexibility by providing us with assets that could support unsecured short‑term financing or that could serve as substitute collateral. Should market factors, which are beyond our control, adversely impact our access to these debt sources at economically feasible rates, our ability to grow through additional real estate acquisitions will be limited to any undistributed amounts available from our operations and any additional equity capital raises.

As shown in the table below, net cash provided by operating activities rose primarily due to the increase in the size of our real estate investment portfolio. Our real estate investing activities have grown in volume as we continue to make headway into our target market by identifying and acquiring real estate, primarily through sale‑leaseback transactions. Real estate investment activity in the first quarter of 2015 was primarily funded with a combination of cash on hand from our November 2014 IPO, cash from operations and borrowings under our short-term credit facility.  Proceedsfrom 2014 sales of properties from the STORE Master Funding collateral pool that were held in restricted cash for reinvestment in substitute real estate assets as of December 31, 2014 were also used to fund a portion of the real estate investment activity in 2015.  During the three months ended March 31, 2014, real estate investment activity was funded with cash from operations and borrowings on our short-term credit facilities, as well as with proceeds from the issuance of common stock in our private stock offerings and proceeds from the sale ofa property. Dividends paid during the three months ended March 31, 2015 totaled $13.1 million, representing a pro-rated dividend per common share of $0.1139, or $1.00 per share on an annualized basis, for the period from the closing of the IPO through December 31, 2014. Dividends paid during the three months ended March 31, 2014 totaled $15.1 million, representing a full quarter’s dividend. Cash and cash equivalents totaled $30.3 million and $136.3 million at March 31, 2015 and December 31, 2014, respectively.

	Three Months Ended
	March 31,
(In thousands)	2015		2014
Net cash provided by operating activities	$	36,073	$	20,976
Net cash used in investing activities		(285,709)		(275,914)
Net cash provided by financing activities		143,647		248,338
Net decrease in cash and cash equivalents	$	(105,989)	$	(6,600)

27

Management believes that the cash generated by our operations, together with our cash and cash equivalents at March 31, 2015, our current borrowing capacity on our revolving credit facility and our access to long‑term debt capital, will be sufficient to fund our operations for the foreseeable future and allow us to acquire the real estate for which we currently have made commitments. In order to continue to grow our real estate portfolio in the future beyond the excess cash generated by our operations and our ability to borrow, we intend to raise additional equity capital through the sale of our common stock.

Real Estate Portfolio Information

As of March 31, 2015, our total investment in real estate and loans approximated $3.1 billion, representing investments in 1,073 property locations, substantially all of which are profit centers for our customers.  These investments generate our cash flows from more than 380 contracts predominantly structured as net leases, mortgage loans and combinations of leases and mortgage loans, or hybrid leases.  As of March 31, 2015, all of our owned single‑tenant properties were subject to leases and the weighted average non‑cancellable remaining term of our leases was approximately 15 years.

Our real estate portfolio is highly diversified.  As of March 31, 2015, our 1,073 property locations were operated by 246 customers across 46 states.  None of our customers represented more than 4% of our portfolio at March 31, 2015, and our top ten largest customers represented less than 19% of annualized base rent and interest.  Our customers operate their businesses across 227 brand names or business concepts in more than 65 industries.  Our top five concepts as of March 31, 2015 were Ashley Furniture HomeStore, Gander Mountain, Applebee’s, Popeyes Louisiana Kitchen and Starplex Cinemas; combined, these concepts represented 14% of annualized base rent and interest.  Our top five industries as of March 31, 2015 are restaurants, health clubs, early childhood education centers, movie theaters and furniture stores.  Combined, these industries represented 54% of annualized base rent and interest. 

The following tables summarize the diversification of our real estate portfolio based on the percentage of base rent and interest, annualized based on rates in effect on March 31, 2015, for all of our leases, loans and direct financing receivables in place as of that date.

Diversification by Customer

As of March 31, 2015, our 1,073 property locations were operated by our 246 customers.  The following table identifies our ten largest customers as of March 31, 2015(1):

	% of
	Annualized
	Base Rent		Number
	and		of
Customer	Interest		Properties
Gander Mountain Company	3.22	%	12
SMH Theatres, Inc.	2.74		10
O'Charley's LLC	2.16		30
Sailormen, Inc.	1.72		41
FreedomRoads, LLC	1.67		8
Rainbow Early Education Holding, LLC	1.54		34
Heald College, LLC (1)	1.38		5
Conn's, Inc.	1.35		7
RMH Franchise Holdings, Inc.	1.34		17
Hill Country Holdings, LLC	1.32		6
All other customers (236 customers)	81.56		903
Total	100.00	%	1,073

(1) Subsequent to March 31, 2015, we terminated our two leases with Heald College, LLC (Heald); as a result, Heald is no longer one of our top ten customers.

28

Diversification by Concept

As of March 31, 2015, our customers operated their businesses across 227 concepts.  The following table identifies the top ten concepts as of March 31, 2015:

	% of
	Annualized
	Base Rent		Number
	and		of
Customer Business Concept	Interest		Properties
Ashley Furniture HomeStore	3.28	%	17
Gander Mountain	3.22		12
Applebee's	2.74		36
Popeyes Louisiana Kitchen	2.29		57
Starplex Cinemas	2.27		8
O'Charley's	2.16		30
KFC	1.67		51
FreedomRoads	1.67		8
Rainbow Child Care Center	1.54		34
Captain D's	1.44		58
All other concepts (217 concepts)	77.72		762
Total	100.00	%	1,073

Diversification by Industry

As of March 31, 2015, our customers’ business concepts were diversified across more than 65 industries within the service, retail and industrial sectors of the U.S. economy.  The following table summarizes those industries as of March 31, 2015:

	% of
	Annualized			Building
	Base Rent		Number	Square
	and		of	Footage
Customer Industry	Interest		Properties	(in thousands)
Service:
Restaurants—full service	16.90	%	235	1,685
Restaurants—limited service	10.72		305	896
Health clubs	7.80		44	1,447
Early childhood education centers	7.62		121	1,209
Movie theaters	6.76		27	1,017
Colleges and professional schools	2.96		6	466
Junior colleges	2.53		10	709
Family entertainment	1.84		6	336
All other service industries (27 industries)	17.28		162	3,776
Total service:	74.41		916	11,541
Retail:
Furniture stores	4.00		22	1,037
Sporting goods stores	3.80		15	983
All other retail industries (10 industries)	7.16		53	2,442
Total retail:	14.96		90	4,462
Industrial:
All industrial (22 industries)	10.63		67	6,772
Total	100.00	%	1,073	22,775

29

Diversification by Geography

Our portfolio is also highly diversified by geography, as our 1,073 property locations can be found in 46 of the 50 states (excluding Alaska, Delaware, Hawaii and Rhode Island).  The following table details the top ten geographical locations of the properties as of March 31, 2015:

	% of
	Annualized
	Base Rent
	and		Number of
State	Interest		Properties
Texas	12.89	%	84
Illinois	6.41		53
Tennessee	5.88		70
Georgia	5.68		76
California	4.97		19
Florida	4.69		62
Ohio	4.55		61
Arizona	4.34		36
Pennsylvania	4.01		20
North Carolina	3.85		75
All other states (36 states) (1)	42.73		517
Total	100.00	%	1,073

(1) Includes one property in Ontario, Canada which represents less than 0.2% of annualized base rent and interest.

Contract Expirations

The following table sets forth the schedule of our lease, loan and direct financing receivable expirations as of March 31, 2015:

	% of
	Annualized
	Base Rent
	and		Number of
Year of Lease Expiration or Loan Maturity (1)	Interest		Properties
Remainder of 2015	0.30	%	4
2016	—		—
2017	0.37		4
2018	0.39		2
2019	0.88		6
2020	0.72		3
2021	1.11		4
2022	0.38		4
2023	3.35		38
2024	2.27		19
2025	2.52		14
2026	3.42		30
2027	9.07		63
2028	14.76		119
2029	17.58		195
2030	3.23		38
Thereafter	39.65		530
Total	100.00	%	1,073

(1) Expiration year of contracts in place as of March 31, 2015 and excludes any tenant option renewal periods.

30

Recently Issued Accounting Pronouncements

See Note 2 to the March 31, 2015 unaudited condensed consolidated financial statements.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles, or GAAP, requires our management to use judgment in the application of accounting policies, including making estimates and assumptions. We base estimates on the best information available to us at the time, our experience and on various other assumptions believed to be reasonable under the circumstances. These estimates affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. If our judgment or interpretation of the facts and circumstances relating to various transactions or other matters had been different, it is possible that different accounting would have been applied, resulting in a different presentation of our condensed consolidated financial statements. From time to time, we reevaluate our estimates and assumptions. In the event estimates or assumptions prove to be different from actual results, adjustments are made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. A summary of our critical accounting policies is included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014 in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” We have not made any material changes to these policies during the periods covered by this quarterly report.

Results of Operations

Three months Ended March 31, 2015 Compared to Three months Ended March 31, 2014

	Three Months Ended
	March 31,				Increase
(In thousands)	2015		2014		(Decrease)
Total revenues	$	61,459	$	39,329	$	22,130
Expenses:
Interest		17,229		14,405		2,824
Transaction costs		259		398		(139)
Property costs		295		37		258
General and administrative		6,635		4,183		2,452
Depreciation and amortization		18,892		11,561		7,331
Provisions for impairment of real estate		1,000		—		1,000
Total expenses		44,310		30,584		13,726
Income from continuing operations before income taxes		17,149		8,745		8,404
Income tax expense		83		52		31
Income from continuing operations		17,066		8,693		8,373
Income from discontinued operations		—		846		(846)
Net income	$	17,066	$	9,539	$	7,527

Overview

As of March 31, 2015, our real estate investment portfolio had grown to $3.1 billion, consisting of investments in 1,073 property locations in 46 states, operated by 246 customers in various industries. Approximately 95% of the real estate investment portfolio represents commercial real estate properties subject to long‑term leases, 5% represents mortgage loans and direct financing receivables primarily on commercial real estate buildings (located on land we own and lease to our customers) and a nominal amount represents loans receivable secured by our tenants’ other assets. All of our owned properties were subject to a lease as of March 31, 2015.

31

Revenues

Revenues rose to $61.5 million for the three months ended March 31, 2015 from $39.3 million for the three months ended March 31, 2014, driven primarily by the growth in the size of our real estate investment portfolio, which generated additional rental revenues and interest income. Our real estate investment portfolio grew from $1.7 billion in gross investment amount representing 622 properties at the beginning of 2014 to $3.1 billion in gross investment amount representing 1,073 properties at March 31, 2015. Our real estate investments were made throughout the periods presented and were not all outstanding for the entire period; accordingly, the vast majority of the increase in revenues between periods is primarily related to recognizing revenue in 2015 for acquisitions that were made during 2014. Similarly, the full revenue impact of acquisitions made during the first three months of 2015 will not be seen until the second quarter of 2015. The weighted average real estate investment amounts outstanding during the three-month periods were $2.93 billion in 2015 and $1.84 billion in the comparable period of 2014.

The weighted average initial real estate capitalization rate (generally calculated as the initial annualized base rent divided by the purchase price of the properties) on the properties we acquired during the three months ended March 31, 2015 and 2014 was approximately 8.3% and 8.5%, respectively.

The initial rental rates we receive on sale‑leaseback transactions on the various types of properties we target across the United States vary from transaction to transaction based on many factors, such as the terms of the lease, each property’s real estate fundamentals and the market rents in the area. The majority of our transactions are sale‑leaseback transactions where we acquire the property and simultaneously negotiate a lease with the tenant based on their business needs, whereas the properties listed in online commercial real estate marketplaces are often subject to existing leases and are offered by third‑party sellers. Since our real estate leases represent an alternative for our customers to other forms of corporate capitalization, lease rates can also be influenced by changes in interest rates and overall capital availability. In general, because we provide tailored customer lease solutions, our lease rates have been historically subject to less variance than the auction marketplace as a whole. We have seen a general decrease of approximately 0.35% between March 2014 and March 2015 in real estate capitalization rates listed in online commercial real estate marketplaces. While we have experienced less downward lease rate pressures with the investments we funded thus far in 2015, we have seen some lease rate compression. The impact of the lower lease rates may be wholly or partially offset by opportunities for lower long‑term borrowing costs.For example, we were able to achieve a lower weighted average borrowing cost of 4.1% on the April 2015 issuance of STORE Master Funding bonds mentioned earlier as compared to the 4.6% weighted average rate of our STORE Master Funding bonds issued in May of 2014;  although there is no assurance we will always be able to realize such opportunities.

32

Interest Expense

Interest expense increased to $17.2 million for the three months ended March 31, 2015 from $14.4 million in 2014 due primarily to an increase in long‑term borrowings used to partially fund the acquisition of properties for our growing real estate investment portfolio. We funded the growth in our real estate investment portfolio with added equity and long‑term debt, using our short‑term credit facilities to temporarily finance the properties we acquired.

The following table summarizes our interest expense for the periods.

	Three Months Ended
	March 31,
(Dollars in thousands)	2015			2014
Interest expense—short-term credit facilities (includes non-use fees)	$	383		$	759
Interest expense—non-recourse debt obligations of consolidated special purpose entities		15,666			12,312
Capitalized interest		(217)			—
Amortization of deferred financing costs and other		1,397			1,334
Total interest expense	$	17,229		$	14,405
Secured short-term credit facilities:
Average debt outstanding	$	35,856		$	71,986
Average interest rate (includes non-use fees)		4.3	%		4.2	%
Non-recourse debt obligations of consolidated special purpose entities:
Average debt outstanding	$	1,281,146		$	998,400
Average interest rate		4.9	%		4.9	%

The average amount of long-term debt outstanding was $1.28 billion during the three months ended March 31, 2015, up from $1.0 billion during the same period in 2014, which is the primary driver for the increase in interest expense on long-term debt.  Long-term debt added after March 31, 2014 included one series of STORE Master Funding net‑lease mortgage notes payable aggregating $260 million in principal amount with a weighted average interest rate of 4.64% and $26.5 million of traditional mortgage debt.  As of March 31, 2015, we had $1.28 billion of outstanding long-term debt with a weighted average interest rate of 4.9%. The average debt outstanding on our credit facilities decreased from $72.0 million during the three months ended March 31, 2014 to $35.9 million during the same period in 2015, primarily due to the availability of net equity proceeds from our IPO that we used to make real estate investments during 2015. From time to time, we may have construction activities on one or more of our real estate properties; interest capitalized as a part of those activities represented $0.2 million during the three months ended March 31, 2015. 

Transaction Costs

Our real estate acquisitions have been predominantly sale‑leaseback transactions in which acquisition and closing costs were capitalized as part of the investment in the property. We also occasionally acquire properties subject to an existing lease. Costs incurred on real estate transactions where we acquired properties that are subject to an existing lease were expensed to operations as incurred. Transaction costs expensed during the three months ended March 31, 2015 totaled $0.3 million, as compared to $0.4 million incurred during the same period in 2014. Whether the real estate we acquire is subject to an existing lease or not determines how we account for the related transaction costs and, accordingly, may cause variability in the level of such costs expensed to operations from year to year.

Property Costs

Approximately 96% of our leases are triple-net, meaning that our tenants are generally responsible for the property-level operating costs such as taxes, insurance and maintenance. Accordingly, we generally do not expect to incur property-level operating costs or capital expenditures, except during any period where one or more of our properties is no longer under lease. Our need to expend capital on our properties is further reduced due to the fact that some of our tenants will periodically refresh the property at their own expense to meet their business needs or in connection with franchisor requirements.  As of March 31, 2015, all of our properties were under lease and we have few near-term scheduled lease maturities; however, we expect to incur some property costs related to terminated leases on

33

five properties due to a tenant default that occurred subsequent to March 31, 2015, until such time as those properties are relet to new tenants.

General and Administrative Expenses

General and administrative expenses include compensation and benefits; professional fees such as portfolio servicing, legal and accounting fees; and general office expenses such as insurance, office rent and travel costs. General and administrative costs totaled $6.6 million for the three months ended March 31, 2015 as compared to $4.2 million for the same period in 2014 with the increase being primarily due to the growth of our portfolio and additions to our staff due to the growth in our operations and to the increased costs of being a public company. Expenses, such as property‑related insurance costs and the costs of servicing the properties and loans comprising our real estate portfolio, increase in direct proportion to the increase in the size of the portfolio. Our number of employees grew from 45 employees at March 31, 2014 to 54 employees as of March 31, 2015; the added positions expanded our portfolio management and servicing team and other operations support functions and contributed to the increase in compensation and employee benefits expense. A portion of the increase in expenses for the three months ended March 31, 2015 as compared to 2014 was due to costs related to being a public company, including the costs of public company governance and reporting and meeting other regulatory requirements. We expect that general and administrative expenses will continue to rise in some measure as our real estate investment portfolio grows; however, we expect that such expenses as a percentage of the portfolio will decrease over time due to efficiencies and economies of scale.

Depreciation and Amortization Expense

Depreciation and amortization expense generally rises in proportion to the increase in the size of our real estate portfolio and, accordingly, such expense rose from $11.6 million for the three months ended March 31, 2014 to $18.9 million for the comparable period in 2015.

Net Income

Our net income rose to $17.1 million for the three months ended March 31, 2015 from the $9.5 million in net income reported for the comparable period in 2014. The increase in net income is primarily due to the growth in the size of our real estate investment portfolio, which generated additional rental revenues and interest income. Net income for the three months ended March 31, 2015, includes the impact of a $1.0 million provision for impairment of one property, associated with a lease that we terminated after March 31, 2015, based on the likelihood that the property may be sold in the near term.  We sell properties from time to time in order to enhance the diversity and quality of our real estate portfolio.  There were no gains or losses recognized on property disposition transactions during the three months ended March 31, 2015; net income for the three months ended March 31, 2014 includes a $0.7 million gain on the sale of one property.

Non‑GAAP Measures

Our reported results are presented in accordance with GAAP. We also disclose Funds from Operations, or FFO, and Adjusted Funds from Operations, or AFFO, both of which are non‑GAAP measures. We believe these two non‑GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs. FFO and AFFO do not represent cash generated from operating activities and 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 reported on our statement of cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures.

We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. NAREIT defines FFO as GAAP net income, excluding gains (or losses) from extraordinary items and sales of depreciable property, real estate impairment losses and depreciation and amortization expense from real estate assets, including the pro rata share of such adjustments of unconsolidated subsidiaries. To derive AFFO, we modify the NAREIT computation of FFO to include other adjustments to GAAP net

34

income related to non‑cash revenues and expenses such as straight‑line rents, amortization of deferred financing costs and stock‑based compensation. In addition, in deriving AFFO, we exclude transaction costs associated with acquiring real estate subject to existing leases.

FFO is used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers primarily because it excludes the effect of real estate depreciation and amortization and net gains on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. Management believes that AFFO provides more useful information to investors and analysts because it modifies FFO to exclude additional non-cash revenues and expenses such as straight‑line rents, amortization of deferred financing costs and stock‑based compensation as such items may cause short-term fluctuations in net income but have no impact on operating cash flows or long-term operating performance. Additionally, in deriving AFFO, we exclude transaction costs associated with acquiring real estate subject to existing leases. We view transaction costs to be a part of our investment in the real estate we acquire, similar to the treatment of acquisition and closing costs on our sale-leaseback transactions, which are capitalized as a part of the investment in the asset. We believe that transaction costs are not an ongoing cost of the portfolio in place at the end of each reporting period and, for these reasons, we add back the portion expensed when computing AFFO.  As a result, we believe AFFO to be a more meaningful measurement of ongoing performance that allows for greater performance comparability.  Therefore, we disclose both FFO and AFFO and reconcile them to the most appropriate GAAP performance metric, which is net income.  STORE Capital’s FFO and AFFO may not be comparable to similarly titled measures employed by other companies.

The following is a reconciliation of net income (which we believe is the most comparable GAAP measure) to FFO and AFFO.

	Three Months Ended
	March 31,
(Dollars in thousands)	2015		2014
Net income	$	17,066	$	9,539
Depreciation and amortization of real estate assets		18,810		11,491
Provisions for impairment of real estate		1,000		—
Gain on dispositions of real estate		—		(743)
Funds from Operations		36,876		20,287
Adjustments:
Straight-line rental revenue, net		(108)		(616)
Transaction costs		259		398
Non-cash equity-based compensation		897		373
Non-cash interest expense		1,397		1,334
Amortization of lease-related intangibles and costs		220		109
Adjusted Funds from Operations	$	39,541	$	21,885

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

Our interest rate risk management objective is to limit the impact of future interest rate changes on our earnings and cash flows. We seek to match the cash inflows from our long‑term leases with the expected cash outflows on our long‑term debt. To achieve this objective, our consolidated subsidiaries primarily borrow on a fixed‑rate basis for longer‑term debt issuances. At March 31, 2015, substantially all of our outstanding long‑term debt carried a fixed interest rate and the weighted average debt maturity was approximately seven years. We are exposed to interest rate risk between the time we enter into a sale‑leaseback transaction and the time we finance the related real estate with long‑term fixed‑rate debt. In addition, when that long‑term debt matures, we may have to refinance the real estate at a higher interest rate. Market interest rates are sensitive to many factors that are beyond our control.

We address interest rate risk by employing the following strategies to help insulate us from any adverse impact of rising interest rates:

35

· We seek to minimize the time period between acquisition of our real estate and the ultimate financing of that real estate with long‑term fixed‑rate debt.

· By using serial issuances of long-term debt, we intend to ladder out our debt maturities to avoid a significant amount of debt maturing during any single period.

· We choose long‑term debt that generally provides for some amortization of the principal balance over the term of the debt, which serves to reduce the amount of refinancing risk at debt maturity to the extent that we can refinance the reduced debt balance over a revised long-term amortization schedule. 

· We strive to grow our free cash flow such that, over time, our cash flow from operating activities, after principal payments on our debt, plus cash flows from property sales and principal collected on our loans receivable, each year exceeds that year’s scheduled debt maturities.

See our Annual Report on Form 10-K for the year ended December 31, 2014 under the heading “Item 7A. Quantitative and Qualitative Disclosures About Market Risk” for a more complete discussion of our interest rate sensitive assets and liabilities.  As of March 31, 2015, our market risk has not changed materially from the amounts reported in our Annual Report on Form 10-K for the year ended December 31, 2014.

Item 4.  Controls and Procedures.

Disclosure Controls and Procedures

The disclosure controls and procedures of the Company are designed with the objective of ensuring that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.  Our disclosure controls and procedures are also designed to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. As a result, our disclosure controls and procedures are designed to provide reasonable assurance that such disclosure controls and procedures will meet their objectives.

As of March 31, 2015, we carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the disclosure controls and procedures of the Company as defined in Rule 13a-15(e) under the Exchange Act.  Based on this evaluation, the Chief Executive Officer and Chief Financial Officer of the Company concluded that the Company’s design and operation of these disclosure controls and procedures are effective at the reasonable assurance level described above.

Changes in Internal Control over Financial Reporting

There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the first fiscal quarter to which this report relates that materially affected, or are reasonably likely to materially affect, the internal control over financial reporting of the Company.

36

PART II – OTHER INFORMATION

Item 1.  Legal Proceedings.

From time to time, we become party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of our business and the business of our tenants.   Since our organization in May 2011, we have not been a party, as plaintiff or defendant, to any legal proceedings that we believe to be material or which, individually or in the aggregate, would be expected to have a material effect on our business, financial condition or results of operations if determined adversely to us.

Item 1A.  Risk Factors.

There have been no material changes to the risk factors as disclosed in the section entitled “Risk Factors” beginning on page 11 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2014 and filed with the Securities and Exchange Commission.  Please review the Risk Factors set forth in the Form 10-K.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

Use of Proceeds from the Sale of Registered Securities

Our registration statement on Form S-11, as amended (Registration No. 333-198486), with respect to our IPO was declared effective on November 17, 2014.  On November 21, 2014, the Company completed the IPO through the registration and sale of 31,625,000 shares of common stock, including 4,125,000 shares of common stock sold in connection with the full exercise of the underwriters’ over-allotment option to purchase additional shares, raising gross proceeds of approximately $585 million.

As of the date of this quarterly report, our IPO has terminated and all of the securities registered for sale by us pursuant to our registration statement on Form S-11 have been sold. The joint book-running managers of the IPO were Goldman, Sachs & Co., Credit Suisse Securities (USA) LLC and Morgan Stanley & Co. LLC. The joint lead managers of the IPO were Citigroup Global Markets Inc., Deutsche Bank Securities Inc., KeyBanc Capital Markets Inc. and Wells Fargo Securities, LLC. BMO Capital Markets Corp., Raymond James & Associates, Inc., Robert W. Baird & Co. Incorporated, Stifel, Nicolaus & Company, Incorporated, SunTrust Robinson Humphrey, Inc. and Comerica Securities, Inc. acted as co-managers for the IPO.

The expenses of the IPO included approximately $35 million for underwriting discounts and commissions and approximately $4 million of other expenses, for total offering expenses of approximately $39 million. All of the foregoing underwriting discounts and expenses were direct or indirect payments to persons other than: (i) our directors, officers or any of their associates; (ii) persons owning ten percent (10%) or more of our shares of common stock; or (iii) our affiliates.

The net proceeds to us from the IPO totaled approximately $546 million, after deducting the underwriting discounts and commissions and other offering expenses.  At the time of thecompletion of the IPO, we used approximately $223 million of the net offering proceeds to repay the outstanding balance under our credit facility and $125,000 to redeem all outstanding shares of our Series A Preferred Stock.  As of March 31, 2015, we have deployed all the remaining proceeds for property acquisitions.

Unregistered Sales and Repurchases of Equity Securities

The Company did not sell or repurchase any of its equity securities during the three months ended March 31, 2015.

Item 3.  Defaults Upon Senior Securities.

None.

37

Item 4.  Mine Safety Disclosures.

None.

Item 5.  Other Information.

None.

Item 6.  Exhibits

The exhibits filed or furnished with this Report are set forth in the Exhibit Index.

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 thereunto duly authorized.

STORE CAPITAL CORPORATION
(Registrant)

Date:  May 15, 2015By: /s/ Catherine Long

Catherine Long
      Executive Vice President and Chief Financial Officer

(Principal Financial and Accounting Officer)

38

EXHIBIT INDEX

Exhibit No.	Description
4.1	Fourth Amended and Restated Master Indenture dated as of April 16, 2015, among STORE Master Funding I, LLC, STORE Master Funding II, LLC, STORE Master Funding III, LLC, STORE Master Funding IV, LLC, STORE Master Funding V, LLC and STORE Master Funding VI, LLC, each a Delaware limited liability company, collectively as issuers, and Citibank, N.A., as indenture trustee, relating to Net-Lease Mortgage Notes (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated April 16, 2015 and filed with the Securities and Exchange Commission on April 20, 2015 (Commission File No. 001-36739)).
4.2	Series 2015-1 Indenture Supplement dated as of April 16, 2015, among STORE Master Funding I, LLC, STORE Master Funding II, LLC, STORE Master Funding III, LLC, STORE Master Funding IV, LLC, STORE Master Funding V, LLC and STORE Master Funding VI, LLC, each a Delaware limited liability company, and Citibank, N.A., as indenture trustee (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K dated April 16, 2015 and filed with the Securities and Exchange Commission on April 20, 2015 (Commission File No. 001-36739)).
10.1	Fourth Amended and Restated Property Management and Servicing Agreement dated as of April 16, 2015, among STORE Master Funding I, LLC, STORE Master Funding II, LLC, STORE Master Funding III, LLC, STORE Mastering Funding IV, LLC, STORE Master Funding V, LLC and STORE Master Funding VI, LLC, each a Delaware limited liability company, collectively as issuers, STORE Capital Corporation, a Maryland corporation, as property manager and special servicer, and Midland Loan Services, Inc., a Delaware corporation, as back-up manager and Citibank, N.A., as indenture trustee (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated April 16, 2015 and filed with the Securities and Exchange Commission on April 20, 2015 (Commission File No. 001-36739)).
10.2	Form of Restricted Share Award Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated March 27, 2015 and filed with the Securities and Exchange Commission on March 30, 2015 (Commission File No. 001-36739)).
10.3	Form of Restricted Share Unit Award Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K dated March 27, 2015 and filed with the Securities and Exchange Commission on March 30, 2015 (Commission File No. 001-36739)).
31.1	Rule 13a-14(a) Certification of the Chief Executive Officer.
31.2	Rule 13a-14(a) Certification of the Chief Financial Officer.
32.1	Section 1350 Certification of the Chief Executive Officer.
32.2	Section 1350 Certification of the Chief Financial Officer.
99.1	Bridge Loan Credit Agreement dated as of April 8, 2015 (incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K dated April 8, 2015 and filed with the Securities and Exchange Commission on April 13, 2015 (Commission File No. 001-36739)).
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Definition Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

39

EX-31.1

EXHIBIT 31.1

CERTIFICATION

I, Christopher H. Volk, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q  of STORE Capital Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 15, 2015
	/s/ Christopher H. Volk
	Christopher H. Volk
	Chief Executive Officer
	(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATION

I, Catherine Long, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q  of STORE Capital Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 15, 2015
	/s/ Catherine Long
	Catherine Long
	Chief Financial Officer
	(Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002

In connection with the periodic report of STORE Capital Corporation (the “Company”) on Form 10-Q for the quarter ended March 31, 2015, as filed with the Securities and Exchange Commission (the “Report”), I, Christopher H. Volk, Chief Executive Officer of the Company, hereby certify as of the date hereof, solely for purposes of Title 18, Chapter 63, Section 1350 of the United States Code, that to the best of my knowledge:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.

5
Date: May 15, 2015	/s/ Christopher H. Volk
	Christopher H. Volk
	Chief Executive Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the periodic report of STORE Capital Corporation (the “Company”) on Form 10-Q for the quarter ended March 31, 2015, as filed with the Securities and Exchange Commission (the “Report”), I, Catherine Long, Chief Financial Officer of the Company, hereby certify as of the date hereof, solely for purposes of Title 18, Chapter 63, Section 1350 of the United States Code, that to the best of my knowledge:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.

5
Date: May 15, 2015
	/s/ Catherine Long
	Catherine Long
	Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Fair Value Measurements (Details) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Derivatives [Line items]
Total non‑recourse debt obligations	$ 1,279,220,000	$ 1,284,151,000
Interest rate swaps
Derivatives [Line items]
Fair value, swaps	417,000	266,000
Consolidated special purpose entities
Derivatives [Line items]
Total non‑recourse debt obligations	1,279,220,000	1,284,151,000
Consolidated special purpose entities | Level 2 Fair Value | Carrying value
Derivatives [Line items]
Total non‑recourse debt obligations	1,279,200,000	1,284,200,000
Consolidated special purpose entities | Level 2 Fair Value | Fair value
Derivatives [Line items]
Total non‑recourse debt obligations	$ 1,377,700,000	$ 1,349,000,000

XML

Investments (Details 4) (USD $)	3 Months Ended
	Mar. 31, 2015 item lease		Mar. 31, 2014	Dec. 31, 2014
Intangible Lease Assets
Intangible lease assets	$ 69,589,000			$ 60,184,000
Accumulated amortization	(7,606,000)			(6,006,000)
Net intangible lease assets	61,983,000			54,178,000
Amortization in the next five years
Remainder of 2015	3,900,000
2016	5,100,000
2017	5,000,000
2018	4,800,000
2019	4,600,000
2020	4,100,000
Accounting for Real Estate Investments
Typical number of renewal options	1
Remaining noncancelable lease term	15 years
Future minimum rentals to be received under the remaining noncancelable term of the operating leases
Remainder of 2015	186,836,000
2016	249,820,000
2017	249,906,000
2018	250,041,000
2019	250,203,000
2020	248,557,000
Thereafter	2,278,194,000
Total future minimum rentals	3,713,557,000	[1]
Future minimum rentals	43,200,000
Annual future rentals	3,600,000
Number of leases terminated subsequent to current period end date	2
Decrease to rental revenue
Amortization in the next five years
Remainder of 2015	900,000
2016	1,200,000
2017	1,200,000
2018	1,200,000
2019	1,200,000
2020	1,200,000
Amortization expense
Intangible Lease Assets
Amount amortized	1,400,000		800,000
Leases, Acquired-in-Place [Member]
Intangible Lease Assets
Intangible lease assets	52,017,000			47,359,000
Amortization in the next five years
Weighted average remaining amortization period	11 years
Above Market Leases [Member]
Intangible Lease Assets
Intangible lease assets	10,273,000			5,526,000
Amortization in the next five years
Weighted average remaining amortization period	9 years
Above Market Leases [Member] | Decrease to rental revenue
Intangible Lease Assets
Amount amortized	231,000
Ground lease interest assets
Intangible Lease Assets
Intangible lease assets	$ 7,299,000			$ 7,299,000
Amortization in the next five years
Weighted average remaining amortization period	75 years

[1] Includes $43.2 million (approximately $3.6 million annually through February 2027) of future rentals associated with two leases terminated subsequent to March 31, 2015.

XML

Investments

3 Months Ended

Mar. 31, 2015

Investments:

Investments

3. Investments

At March 31, 2015, STORE Capital had investments in 1,073 property locations representing 1,059 owned properties (of which 12 are accounted for as direct financing receivables), eight ground lease interests and six properties which secure certain mortgage loans. The gross acquisition cost of real estate investments totaled $2.95 billion at March 31, 2015. In addition, the Company held loans and direct financing receivables with an aggregate carrying amount at March 31, 2015 of $145.8 million. As of March 31, 2015, a substantial portion of these investments are assets of consolidated special purpose entity subsidiaries and are pledged as collateral under the non‑recourse obligations of these special purpose entities (Note 4).

During the three months ended March 31, 2015, the Company had the following gross real estate and loan activity (dollars in thousands):

	Number of	Dollar
	Investment	Amount of
	Locations	Investments (a)
Gross investments, December 31, 2014	947	$	2,805,911
Acquisition of and additions to real estate (b)(c)	123		256,833
Investment in loans and direct financing receivables	3		34,683
Sales of real estate	—		(48)
Principal collections on loans and direct financing receivables	—		(175)
Provision for impairment of real estate			(1,000)
Other			(11)
Gross investments, March 31, 2015 (d)			3,096,193
Less accumulated depreciation and amortization (d)			(117,733)
Net investments, March 31, 2015	1,073	$	2,978,460

(a) The dollar amount of investments includes the investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

(b) Excludes $7.4 million of tenant improvement advances disbursed in 2015 which were accrued as of December 31, 2014.

(c) Includes $0.2 million of interest capitalized to properties under construction.

(d) Includes the dollar amount of investments ($7.4 million) and the accumulated depreciation ($0.6 million) related to real estate investments held for sale at March 31, 2015.

The following table shows information regarding the diversification of the Company’s total investment portfolio among the different industries in which its tenants and borrowers operate as of March 31, 2015 (dollars in thousands):

				Percentage of
	Number of	Dollar		Total Dollar
	Investment	Amount of		Amount of
	Locations	Investments (a)		Investments
Restaurants	540	$	866,861	28	%
Health clubs	44		243,689	8
Early childhood education centers	121		229,183	7
Movie theaters	27		210,866	7
Sporting goods stores	15		122,693	4
Furniture stores	22		121,566	4
Colleges and professional schools	6		79,101	2
All other service industries	178		672,043	22
All other retail industries	53		223,768	7
All industrial	67		326,423	11
	1,073	$	3,096,193	100	%

(a) The dollar amount of investments includes the gross investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

Significant Credit and Revenue Concentration

STORE Capital’s real estate investments are leased or financed to 246 customers geographically dispersed throughout 46 states. Only one state, Texas (13%), accounted for 10% or more of the total dollar amount of STORE Capital’s investment portfolio at March 31, 2015. None of the Company’s 246 customers represented more than 10% of the Company’s real estate investment portfolio at March 31, 2015, with the largest customer representing less than 4% of the total investment portfolio. On an annualized basis, the largest customer also represented less than 4% of the Company’s annualized investment portfolio revenues as of March 31, 2015. The Company’s customers operate their businesses across 227 concepts and none of these concepts represented more than 4% of the Company’s annualized investment portfolio revenues as of March 31, 2015.

Intangible Lease Assets

The following details intangible lease assets and related accumulated amortization (in thousands):

	March 31,		December 31,
	2015		2014
In-place lease assets	$	52,017	$	47,359
Above-market lease assets		10,273		5,526
Ground lease interest assets		7,299		7,299
Total intangible lease assets		69,589		60,184
Accumulated amortization		(7,606)		(6,006)
Net intangible lease assets	$	61,983	$	54,178

Aggregate lease intangible amortization included in expense was $1.4 million and $0.8 million during the three months ended March 31, 2015 and 2014, respectively. The amount amortized as a decrease to rental revenue for capitalized above‑market lease intangibles was $231,000 for the three months ended March 31, 2015.

Based on the balance of the intangible assets at March 31, 2015, the aggregate amortization expense is expected to be $3.9 million for the remainder of 2015, $5.1 million in 2016, $5.0 million in 2017, $4.8 million in 2018, $4.6 million in 2019 and $4.1 million in 2020 and the amount expected to be amortized as a decrease to rental revenue is expected to be $0.9 million for the remainder of 2015 and $1.2 million in each of the nextfiveyears. The weighted average remaining amortization period is approximately 11 years for the in‑place lease intangibles, approximately nine years for the above‑market lease intangibles and approximately 75 years for the amortizing ground lease interests.

Real Estate Investments

The Company’s investment properties are leased to tenants under long‑term operating leases that typically include one or more renewal options. The weighted average remaining noncancelable lease term at March 31, 2015 was approximately 15 years. Substantially all of the leases are triple‑net, which provide that the lessees are responsible for the payment of all property operating expenses, including property taxes, maintenance and insurance; therefore, STORE Capital is generally not responsible for repairs or other capital expenditures related to the properties. At March 31, 2015, all of the properties were subject to a lease.

Scheduled future minimum rentals to be received under the remaining noncancelable term of the operating leases at March 31, 2015, are as follows (in thousands):

Remainder of 2015	$	186,836
2016		249,820
2017		249,906
2018		250,041
2019		250,203
2020		248,557
Thereafter		2,278,194
Total future minimum rentals (a)	$	3,713,557

(a) Includes $43.2 million (approximately $3.6 million annually through February 2027) of future rentals associated with two leases terminated subsequent to March 31, 2015.

Since lease renewal periods are exercisable at the option of the lessee, the preceding table presents future minimum lease payments due during the initial lease term only. In addition, the future minimum lease payments do not include any contingent rentals such as lease escalations based on future changes in CPI.

Loans and Direct Financing Receivables

At March 31, 2015, the Company held 11 loans receivable with an aggregate carrying amount of $95.8 million and had $50.0 million of investments in transactions accounted for as direct financing leases. Ten of the loans are mortgage loans secured by land and/or buildings and improvements on the mortgaged property. The other loan is secured by a tenant’s equipment.

Two of the mortgage loans are short‑term loans and require monthly interest‑only payments with balloon payments at maturity. The remaining mortgage loans receivable generally require the borrowers to make monthly principal and interest payments based on a 40‑year amortization period with balloon payments, if any, at maturity. The other secured loan requires the borrower to make monthly interest‑only payments with a balloon payment at maturity.

The Company’s loans and direct financing receivables are summarized below (dollars in thousands):

	Stated
	Interest		Maturity	March 31,		December 31,
Type	Rate		Date	2015		2014
Mortgage loan receivable	8.50	%	Apr. 2015	$	4,300	$	4,300
Mortgage loan receivable	9.09	%	Jan. 2017		1,933		1,933
Mortgage loan receivable	8.35	%	Jan. 2028		3,772		3,775
Mortgage loan receivable	8.75	%	Jul. 2032		23,969		23,998
Mortgage loan receivable	7.45	%	Jan. 2035		500		—
Mortgage loan receivable	9.00	%	Mar. 2053		14,580		14,595
Mortgage loan receivable	8.75	%	Jun. 2053		6,352		6,357
Mortgage loan receivable	8.50	%	Jun. 2053		6,691		6,697
Mortgage loan receivable	8.25	%	Aug. 2053		3,335		3,337
Mortgage loan receivable (a)	8.50	%	Feb. 2055		28,500		—
Total mortgage loans receivable					93,932		64,992
Equipment loan receivable					—		94
Equipment loan receivable	7.75	%	Mar. 2017		1,063		—
Total principal amount outstanding—loans receivable					94,995		65,086
Unamortized loan origination costs					883		497
Direct financing receivables					49,972		45,771
Total loans and direct financing receivables				$	145,850	$	111,354

(a) Mortgage loan receivable has an initial interest rate of 8.50%and is subject to increases over the term of the loan.  The loan allows for prepayment in whole, but not in part, with penalties ranging from 20% to 70% depending on the timing of the prepayment.

The long‑term mortgage loans receivable generally allow for prepayments in whole, but not in part, without penalty or with penalties typically ranging from 1% to 5%, depending on the timing of the prepayment, except as noted in the table above. All other loans receivable allow for prepayments in whole or in part without penalty.  Absent prepayments, scheduled maturities are expected to be as follows (in thousands):

	Scheduled		Balloon		Total
	Principal		Payments		Payments
Remainder of 2015	$	233	$	4,300	$	4,533
2016		332		—		332
2017		361		2,996		3,357
2018		394		—		394
2019		429		—		429
2020		449		—		449
Thereafter		61,632		23,869		85,501
Total principal repayments	$	63,830	$	31,165	$	94,995

The components of the investments accounted for as direct financing receivables as of March 31, 2015 were as follows (in thousands):

Minimum lease payments receivable	$	129,018
Estimated residual value of leased assets		5,076
Unearned income		(84,122)
Net investment	$	49,972

XML

Debt - (Details 2) (USD $)	0 Months Ended			3 Months Ended
	Apr. 08, 2015	Apr. 01, 2015	Apr. 16, 2015 item	Mar. 31, 2015		Dec. 31, 2014
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Total non‑recourse debt obligations				$ 1,279,220,000		$ 1,284,151,000
Subsequent Event [Member]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Debt Instrument, Description of Variable Rate Basis		one-month LIBOR
Credit spread (as a percent)	2.00%
Interest rate swaps
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Number of agreements				2
Base rate | Subsequent Event [Member]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Debt Instrument, Description of Variable Rate Basis	Base Rate
One-Month LIBOR | Subsequent Event [Member]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Debt Instrument, Description of Variable Rate Basis	one-month LIBOR
Non‑recourse net‑lease mortgage notes:
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Retained non-amortizing notes				78,000,000
Non‑recourse net‑lease mortgage notes: | Subsequent Event [Member]
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Number of tranches			2
Non‑recourse net‑lease mortgage notes: | Class A | Subsequent Event [Member]
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Net lease mortgage notes			365,000,000
Non‑recourse net‑lease mortgage notes: | Tranche 1 of Class A | Subsequent Event [Member]
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Net lease mortgage notes			95,000,000
Term of net lease mortgage notes			7 years
Stated Interest Rate (as a percent)			3.75%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)			3.75%
Non‑recourse net‑lease mortgage notes: | Tranche 2 of Class A | Subsequent Event [Member]
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Net lease mortgage notes			270,000,000
Term of net lease mortgage notes			10 years
Stated Interest Rate (as a percent)			4.17%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)			4.17%
Non‑recourse net‑lease mortgage notes: | Class B | Subsequent Event [Member]
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Net lease mortgage notes			30,000,000
Non‑recourse mortgage notes payable: | Interest rate swaps
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Number of agreements				2
Non‑recourse mortgage notes payable: | $20,530 note issued December 2011 and amended February 2012 | Interest rate swaps
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Number of agreements				2
Non‑recourse mortgage notes payable: | $12.6 million portion of note issued December 2011 and amended February 2012 | Interest rate swaps
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Outstanding balance				12,600,000
Fixed rate				5.299%
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				12,600,000
Non‑recourse mortgage notes payable: | $6.6 million portion of note issued December 2011 and amended February 2012 | Interest rate swaps
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Outstanding balance				6,600,000
Fixed rate				5.23%
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				6,600,000
Consolidated special purpose entities
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Unamortized financing costs related to all debt				30,100,000		30,900,000
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Outstanding balance				1,278,714,000		1,283,495,000
Unamortized net premium				506,000		656,000
Total non‑recourse debt obligations				1,279,220,000		1,284,151,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Remainder of 2015				33,118,000
2016				26,338,000
2017				30,438,000
2018				27,735,000
2019				233,304,000
2020				309,927,000
Thereafter				617,854,000
Long-term Debt				1,278,714,000		1,283,495,000
Consolidated special purpose entities | Scheduled principal
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Outstanding balance				146,397,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Remainder of 2015				14,408,000
2016				19,789,000
2017				20,517,000
2018				21,070,000
2019				19,765,000
2020				13,942,000
Thereafter				36,906,000
Long-term Debt				146,397,000
Consolidated special purpose entities | Balloon payments
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Outstanding balance				1,132,317,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Remainder of 2015				18,710,000
2016				6,549,000
2017				9,921,000
2018				6,665,000
2019				213,539,000
2020				295,985,000
Thereafter				580,948,000
Long-term Debt				1,132,317,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes:
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Aggregate investment amount				1,600,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes: | Series 2012‑1, Class A
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.77%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				5.77%
Outstanding balance				206,698,000		207,503,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				206,698,000		207,503,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes: | Series 2013-1, Class A-1 Due March 2020
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.16%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				4.16%
Outstanding balance				145,259,000		145,876,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				145,259,000		145,876,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes: | Series 2013-2, Class A-1
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.37%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				4.37%
Outstanding balance				104,324,000		104,740,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				104,324,000		104,740,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes: | Series 2013-3, Class A-1
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.24%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				4.24%
Outstanding balance				75,473,000		75,767,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				75,473,000		75,767,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes: | Series 2014‑1, Class A‑1 Due April 2021
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.21%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				4.21%
Outstanding balance				119,500,000		119,650,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				119,500,000		119,650,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes: | Series 2013-1, Class A-2 Due March 2023
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.65%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				4.65%
Outstanding balance				98,776,000		99,196,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				98,776,000		99,196,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes: | Series 2013-2, Class A-2
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.33%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				5.33%
Outstanding balance				94,574,000		94,951,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				94,574,000		94,951,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes: | Series 2013-3, Class A-2
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.21%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				5.21%
Outstanding balance				98,016,000		98,398,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				98,016,000		98,398,000
Consolidated special purpose entities | Non‑recourse net‑lease mortgage notes: | Series 2014‑1, Class A‑2 Due April 2024
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.00%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				5.00%
Outstanding balance				139,417,000		139,592,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				139,417,000		139,592,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable:
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Aggregate investment amount				327,300,000
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				8,000,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $21,443 note issued July 2005
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.26%	[1]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				21,443,000
Stated Interest Rate (as a percent)				5.26%	[1]
Outstanding balance				18,849,000	[1]	18,956,000	[1]
Estimated effective yield at assumption (as a percent)				3.69%
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				18,849,000	[1]	18,956,000	[1]
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $4,000 note issued August 2006
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				6.33%	[2]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				4,000,000
Stated Interest Rate (as a percent)				6.33%	[2]
Outstanding balance				3,299,000	[2]	3,326,000	[2]
Estimated effective yield at assumption (as a percent)				5.15%
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				3,299,000	[2]	3,326,000	[2]
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $3,800 note issued September 2006
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				6.47%	[3]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				3,800,000
Stated Interest Rate (as a percent)				6.47%	[3]
Outstanding balance				3,498,000	[3]	3,512,000	[3]
Estimated effective yield at assumption (as a percent)				3.88%
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				3,498,000	[3]	3,512,000	[3]
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $7,088 note issued April 2007
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				6.00%	[4]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				7,088,000
Stated Interest Rate (as a percent)				6.00%	[4]
Outstanding balance				6,648,000	[4]	6,676,000	[4]
Estimated effective yield at assumption (as a percent)				4.45%
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				6,648,000	[4]	6,676,000	[4]
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $4,400 note issued August 2007
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				6.7665%	[5]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				4,400,000
Stated Interest Rate (as a percent)				6.7665%	[5]
Outstanding balance				3,780,000	[5]	3,807,000	[5]
Estimated effective yield at assumption (as a percent)				3.40%
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				3,780,000	[5]	3,807,000	[5]
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $8,000 note issued January 2012; assumed on December 2013
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.778%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Stated Interest Rate (as a percent)				4.778%
Outstanding balance				7,444,000		7,511,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				7,444,000		7,511,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $20,530 note issued December 2011 and amended February 2012
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.275%	[6]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				20,530,000
Stated Interest Rate (as a percent)				5.275%	[6]
Outstanding balance				19,202,000		19,317,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				19,202,000		19,317,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $20,530 note issued December 2011 and amended February 2012 | One-Month LIBOR
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Credit spread (as a percent)				3.50%
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $6,500 note issued December 2012
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.806%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				6,500,000
Stated Interest Rate (as a percent)				4.806%
Outstanding balance				6,170,000		6,207,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				6,170,000		6,207,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $2,956 note issued June 2013
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				3.173%	[7]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				2,956,000
Stated Interest Rate (as a percent)				3.173%	[7]
Outstanding balance				2,812,000		2,827,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				2,812,000		2,827,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $2,956 note issued June 2013 | One-Month LIBOR
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Credit spread (as a percent)				3.00%
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $16,100 note issued February 2014
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.83%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				16,100,000
Stated Interest Rate (as a percent)				4.83%
Outstanding balance				15,771,000		15,857,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				15,771,000		15,857,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $13,000 note issued May 2012
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.195%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				13,000,000
Stated Interest Rate (as a percent)				5.195%
Outstanding balance				12,253,000		12,326,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				12,253,000		12,326,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $14,950 note issued July 2012
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.95%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				14,950,000
Stated Interest Rate (as a percent)				4.95%
Outstanding balance				13,774,000		13,863,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				13,774,000		13,863,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $26,000 note issued August 2012
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.05%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				26,000,000
Stated Interest Rate (as a percent)				5.05%
Outstanding balance				24,660,000		24,805,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				24,660,000		24,805,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $6,400 note issued November 2012
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.71%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				6,400,000
Stated Interest Rate (as a percent)				4.71%
Outstanding balance				6,090,000		6,127,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				6,090,000		6,127,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $11,895 note issued March 2013
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.73%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				11,895,000
Stated Interest Rate (as a percent)				4.73%
Outstanding balance				11,410,000		11,478,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				11,410,000		11,478,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $17,500 note issued August 2013
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.46%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				17,500,000
Stated Interest Rate (as a percent)				5.46%
Outstanding balance				17,003,000		17,091,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				17,003,000		17,091,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $10,075 note issued March 2014
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				5.10%
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				10,075,000
Stated Interest Rate (as a percent)				5.10%
Outstanding balance				9,947,000		9,984,000
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				9,947,000		9,984,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $7,750 note issued February 2013
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.81%	[8]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				7,750,000
Stated Interest Rate (as a percent)				4.81%	[8]
Outstanding balance				7,424,000		7,468,000
Interest rate term before reset				10 years
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				7,424,000		7,468,000
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $7,750 note issued February 2013 | Initial rate
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Credit spread (as a percent)				4.00%
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $7,750 note issued February 2013 | Treasury rate
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Credit spread (as a percent)				4.00%
Consolidated special purpose entities | Non‑recourse mortgage notes payable: | $6,944 notes issued March 2013
Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities [Line items]
Stated Interest Rate (as a percent)				4.50%	[9]
Summary of non‑recourse debt obligations of consolidated special purpose entity subsidiaries
Principal amount				6,944,000
Stated Interest Rate (as a percent)				4.50%	[9]
Outstanding balance				6,643,000		6,684,000
Interest rate term before reset				10 years
Scheduled maturities, including balloon payments, on the non‑recourse debt obligations
Long-term Debt				$ 6,643,000		$ 6,684,000

[1] Note was assumed in June 2014 at a premium; estimated effective yield at assumption of 3.69%.

[2] Note was assumed in July 2012 at a premium; estimated effective yield at assumption of 5.15%.

[3] Note was assumed in April 2014 at a premium; estimated effective yield at assumption of 3.88%

[4] Note was assumed in December 2013 at a premium; estimated effective yield at assumption of 4.45%

[5] Note was assumed in September 2014 at a premium; estimated effective yield at assumption of 3.40%

[6] Note is a variablerate note which resets monthly at onemonth LIBOR + 3.50%. The Company has entered into two interest rate swap agreements that effectively convert the floating rate on a $12.6 million portion and a $6.6 million portion of this mortgage note payable to fixed rates of 5.299% and 5.230%, respectively (Note 2).

[7] Note is a variablerate note which resets monthly at onemonth LIBOR + 3.00%; rate shown is effective rate at March 31, 2015

[8] Interest rate is effective for first 10 years and will reset to greater of (1) initial rate plus 400 basis points or (2) Treasury rate plus 400 basis points.

[9] Interest rate is effective for first 10 years and will reset to the lender’s then prevailing interest rate.

XML

Debt (Details) (USD $)	0 Months Ended
	Sep. 19, 2014	Apr. 08, 2015	Apr. 01, 2015	Apr. 08, 2014	Mar. 31, 2015	Dec. 31, 2014
Credit facilities
Borrowings outstanding (in dollars)					$ 162,000,000
Minimum EBITDA to fixed charges ratio covenant (as a percent)	1.5
Subsequent Event [Member]
Credit facilities
Initial term				4 months
Extension option term				1 month
Debt Instrument interest rate description			one-month LIBOR
Credit spread (as a percent)		2.00%
Subsequent Event [Member] | Base rate
Credit facilities
Debt Instrument interest rate description		Base Rate
Subsequent Event [Member] | One-Month LIBOR
Credit facilities
Debt Instrument interest rate description		one-month LIBOR
Revolving credit facility
Credit facilities
Unamortized financing costs related to all debt					2,100,000	2,400,000
Interest rate swaps
Credit facilities
Number of agreements					2
Fair value, swaps					417,000	266,000
Interest rate swaps | Non‑recourse mortgage notes payable:
Credit facilities
Number of agreements					2
Termination value, liability position which includes accrued interest					500,000
New unsecured credit facility | Revolving credit facility
Credit facilities
Size of the facilities (in dollars)	300,000,000
Size of the facility with the accordion feature (in dollars)	500,000,000
Initial term	3 years
Extension option term	1 year
Extension fee (as a percent)	0.20%
Non-use fee (as a percent)	0.25%
Borrowing availability, limitation as a percentage of the value of the Company's eligible unencumbered assets (as a percent)	50.00%
Borrowings outstanding (in dollars)					162,000,000
Eligible unencumbered assets (in dollars)					1,100,000,000
Maximum leverage covenant (as a percent)	65.00%
Minimum consolidated net worth, base (in dollars)	600,000,000
Minimum consolidated net worth, percentage of any additional equity raised (as a percent)	75.00%
Maximum dividend payout ratio (as a percent)	95.00%
New unsecured credit facility | Revolving credit facility | Base rate
Credit facilities
Debt Instrument interest rate description	Base Rate
New unsecured credit facility | Revolving credit facility | Base rate | Minimum
Credit facilities
Credit spread (as a percent)	0.75%
New unsecured credit facility | Revolving credit facility | Base rate | Maximum
Credit facilities
Credit spread (as a percent)	1.50%
New unsecured credit facility | Revolving credit facility | One-Month LIBOR
Credit facilities
Debt Instrument interest rate description	one-month LIBOR
Credit spread (as a percent)			1.75%
New unsecured credit facility | Revolving credit facility | One-Month LIBOR | Minimum
Credit facilities
Credit spread (as a percent)	1.75%
New unsecured credit facility | Revolving credit facility | One-Month LIBOR | Maximum
Credit facilities
Credit spread (as a percent)	2.50%
Unsecured loan facility with a bank | Subsequent Event [Member]
Credit facilities
Three-month unsecured bridge loan facility		50,000,000
Previous two secured credit facilities
Credit facilities
Size of the facilities (in dollars)	300,000,000
Number of facilities	2
Previous two secured credit facilities | One-Month LIBOR | Minimum
Credit facilities
Credit spread (as a percent)	2.45%
Previous two secured credit facilities | One-Month LIBOR | Maximum
Credit facilities
Credit spread (as a percent)	3.00%
Part One of first credit facility | One-Month LIBOR
Credit facilities
Debt Instrument interest rate description	one-month LIBOR

XML

Stockholders’ Equity (Details) (USD $)	0 Months Ended		3 Months Ended
	Mar. 30, 2015	Nov. 03, 2014	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
Common stock
Proceeds from contribution of remaining equity commitment in exchange for common stock in the entity (in dollars)			$ 1,000	$ 75,001,000
Common Stock, Par or Stated Value Per Share			$ 0.01		0.01
STORE Holding, parent of the Company
Common stock
Stock split ratio		1.67
Declared dividends payable to common stockholders (in dollars)			$ 28,800,000	$ 15,100,000
Store Holding's distribution	653,382
Holdings in common stock (in shares)			82,148,644		82,802,026
Common Stock, Par or Stated Value Per Share			$ 0.01

XML

Income from Discontinued Operations (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Income from Discontinued Operations
Income from discontinued real estate investments	$ 103,000
Gain on the dispositions of real estate investments	$ 743,000

XML

Summary of Significant Accounting Principles

3 Months Ended

Mar. 31, 2015

Summary of Significant Accounting Principles

Summary of Significant Accounting Principles

2. Summary of Significant Accounting Principles

Basis of Accounting and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (SEC). In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of interim periods are not necessarily indicative of the results for the entire year.  Certain information and note disclosures, normally included in financial statements prepared in accordance with GAAP, have been condensed or omitted from these statements and, accordingly, these statements should be read in conjunction with the Company’s audited consolidated financial statements as filed with the SEC in its Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

These consolidated statements include the accounts of STORE Capital Corporation and its subsidiaries which are wholly‑owned and controlled by the Company through its voting interest. One of the Company’s wholly‑owned subsidiaries, STORE Capital Advisors, LLC, provides all of the general and administrative services for the day‑to‑day operations of the consolidated group, including property acquisition and lease origination, real estate portfolio management and marketing, accounting and treasury services. The remaining subsidiaries were formed to acquire and hold real estate investments or to facilitate non‑recourse secured borrowing activities. Generally, the initial operations of the real estate subsidiaries are funded by an interest‑bearing intercompany loan from STORE Capital Corporation, and such intercompany loan is repaid when the subsidiary issues long‑term debt secured by its properties. All intercompany account balances and transactions have been eliminated in consolidation.

Certain of the Company’s wholly‑owned consolidated subsidiaries were formed as special purpose entities. Each special purpose entity is a separate legal entity and is the sole owner of its assets and liabilities. The assets of the special purpose entities are not available to pay or otherwise satisfy obligations to the creditors of any owner or affiliate of the special purpose entity. At March 31, 2015 and December 31, 2014, assets totaling $2.7 billion and $2.5 billion, respectively, were held and third-party liabilities totaling $1.3 billion were owed by these special purpose entities and are included in the accompanying consolidated balance sheets.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period. Although management believes its estimates are reasonable, actual results could differ from those estimates.

Segment Reporting

The Financial Accounting Standards Board’s (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting, established standards for the manner in which enterprises report information about operating segments. The Company views its operations as one reportable segment.

Accounting for Real Estate Investments

STORE Capital records the acquisition of real estate properties at cost, including acquisition and closing costs. The Company allocates the cost of real estate properties to the tangible and intangible assets and liabilities acquired based on their estimated relative fair values. Real estate properties subject to an existing in‑place lease at the date of acquisition are recorded as business combinations and each tangible and intangible asset and liability acquired is recorded at fair value. Management uses multiple sources to estimate fair value, including independent appraisals and information obtained about each property as a result of its pre‑acquisition due diligence and its marketing and leasing activities. The Company expenses transaction costs associated with real estate acquisitions accounted for as business combinations in the period incurred.

In‑place lease intangibles are valued based on management’s estimates of lost rent and carrying costs during the time it would take to locate a tenant if the property were vacant, considering current market conditions and costs to execute similar leases. In estimating lost rent and carrying costs, management considers market rents, real estate taxes, insurance, costs to execute similar leases including leasing commissions and other related costs. The value assigned to in‑place leases is amortized on a straight‑line basis as a component of depreciation and amortization expense typically over the remaining term of the related leases.

The fair value of any above‑market and below‑market leases is estimated based on the present value of the difference between the contractual amounts to be paid pursuant to the in‑place lease and management’s estimate of current market lease rates for the property, measured over a period equal to the remaining term of the lease. Capitalized above‑market lease intangibles are amortized over the remaining term of the respective leases as a decrease to rental revenue. Below‑market lease intangibles are amortized as an increase in rental revenue over the remaining term of the respective leases plus the fixed‑rate renewal periods on those leases, if any. Should a lease terminate early, the unamortized portion of any related lease intangible is immediately recognized in operations.

The Company’s real estate portfolio is depreciated using the straight‑line method over the estimated remaining useful life of the properties, which generally ranges from 30 to 40 years for buildings and is 15 years for land improvements. Properties classified as held for sale are recorded at the lower of their carrying value or their fair value, less anticipated closing costs. Any properties classified as held for sale are not depreciated.

Impairment

STORE Capital reviews its real estate investments and related lease intangibles periodically for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through operations. Management considers factors such as expected future undiscounted cash flows, estimated residual value, market trends (such as the effects of leasing demand and competition) and other factors including bona fide purchase offers received from third parties in making this assessment. These factors are classified as Level 3 inputs within the fair value hierarchy. An asset is considered impaired if the carrying value of the asset exceeds its estimated undiscounted cash flows and the impairment is calculated as the amount by which the carrying value of the asset exceeds its estimated fair value. Estimating future cash flows is highly subjective and such estimates could differ materially from actual results. During the three months ended March 31, 2015, the Company recorded a provision for impairment of its real estate of $1.0 million.  No impairment charges were recorded during the three months ended March 31, 2014.

Revenue Recognition

STORE Capital leases real estate to its tenants under long‑term net leases that are predominantly classified as operating leases. Direct costs associated with lease origination, offset by any lease origination fees received, are deferred and amortized over the related lease term as an adjustment to rental revenue. Substantially all of the leases are triple‑net, which provide that the lessees are responsible for the payment of all property operating expenses, including property taxes, maintenance and insurance. The Company may collect property taxes from its customers and remit those taxes to governmental authorities; such property taxes are presented on a net basis in the consolidated income statements.

The Company’s leases generally provide for rent escalations throughout the lease terms. For leases that provide for specific contractual escalations, rental revenue is recognized on a straight‑line basis so as to produce a constant periodic rent over the term of the lease. Accordingly, accrued rental revenue, calculated as the aggregate difference between the rental revenue recognized on a straight‑line basis and scheduled rents, represents unbilled rent receivables that the Company will receive only if the tenants make all rent payments required through the expiration of the lease. The Company provides an estimated reserve for uncollectible straight‑line rental revenue based on management’s assessment of the risks inherent in those lease contracts, giving consideration to industry default rates for long‑term receivables. There was $5.8 million and $4.7 million of accrued straight‑line rental revenue, net of allowances of $2.1 million and $1.7 million, at March 31, 2015 and December 31, 2014, respectively, included in other assets on the consolidated balance sheets.  Leases that have contingent rent escalators indexed to future increases in the Consumer Price Index (CPI) may adjust over a one‑year period or over multiple‑year periods. Generally, these escalators increase rent at the lesser of (a) 1 to 1.25 times the increase in the CPI over a specified period or (b) a fixed percentage. Because of the volatility and uncertainty with respect to future changes in the CPI, the Company’s inability to determine the extent to which any specific future change in the CPI is probable at each rent adjustment date during the entire term of these leases and the Company’s view that the multiplier does not represent a significant leverage factor, increases in rental revenue from leases with this type of escalator are recognized only after the changes in the rental rates have actually occurred.

For leases that have contingent rentals that are based on a percentage of the tenant’s gross sales, the Company recognizes contingent rental revenue when the threshold upon which the contingent lease payment is based is actually reached. Less than 1.5% of the Company’s investment portfolio is subject to leases that provide for contingent rent based on a percentage of the tenant’s gross sales.

The Company suspends revenue recognition if the collectibility of amounts due pursuant to a lease is not reasonably assured or if the tenant’s monthly lease payments become more than 60 days past due, whichever is earlier. The Company reviews its rent receivables for collectibility on a regular basis, taking into consideration changes in factors such as the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area where the property is located. In the event that the collectibility of a receivable with respect to any tenant is in doubt, a provision for uncollectible amounts will be established or a direct write‑off of the specific rent receivable will be made. As of March 31, 2015, the Company had a $0.3 million provision for uncollectible contractual rent payments due from tenants; there was no provision at December 31, 2014.

Loans Receivable

STORE Capital holds its loans receivable for long‑term investment. Loans receivable are carried at amortized cost, including related unamortized discounts or premiums, if any.

Revenue Recognition

The Company recognizes interest income on loans receivable using the effective‑interest method applied on a loan‑by‑loan basis. Direct costs associated with originating loans are offset against any related fees received and the balance, along with any premium or discount, is deferred and amortized as an adjustment to interest income over the term of the related loan receivable using the effective interest method. A loan receivable is placed on nonaccrual status when the loan has become 60 days past due, or earlier if management determines that full recovery of the contractually specified payments of principal and interest is doubtful. While on nonaccrual status, interest income is recognized only when received. As of March 31, 2015 and December 31, 2014, there were no loans on nonaccrual status.

Impairment and Provision for Loan Losses

The Company periodically evaluates the collectibility of its loans receivable, including accrued interest, by analyzing the underlying property‑level economics and trends, collateral value and quality and other relevant factors in determining the adequacy of its allowance for loan losses. A loan is determined to be impaired when, in management’s judgment based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Specific allowances for loan losses are provided for impaired loans on an individual loan basis in the amount by which the carrying value exceeds the estimated fair value of the underlying collateral less disposition costs. There was no allowance for loan losses at March 31, 2015 or December 31, 2014.

Direct Financing Receivables

Certain of the Company’s real estate investment transactions are accounted for as direct financing leases. The Company records the direct financing receivables at their net investment, determined as the aggregate minimum lease payments and the estimated residual value of the leased property less unearned income. The unearned income is recognized over the life of the related contracts so as to produce a constant rate of return on the net investment in the asset.

Cash and Cash Equivalents

Cash and cash equivalents include cash and highly liquid investment securities with maturities at acquisition of three months or less. The Company invests cash primarily in money‑market funds of a major financial institution, consisting predominantly of U.S. Government obligations.

Restricted Cash and Escrow Deposits

The Company had $2.4 million and $15.4 million of restricted cash and deposits in escrow at March 31, 2015 and December 31, 2014, respectively which were included in other assets on the consolidated balance sheets.

Deferred Costs

Deferred costs consist principally of financing costs related to the issuance of the Company’s debt. Deferred financing costs are amortized as an increase to interest expense over the term of the related debt instrument using the effective interest method.  Deferred costs also include lease origination costs, which are amortized as a decrease to rental revenue over the term of the respective lease.

Derivative Instruments and Hedging Activities

The Company may enter into derivatives contracts as part of its overall financing strategy to manage the Company’s exposure to changes in interest rates associated with current and/or future debt issuances. The Company does not use derivatives for trading or speculative purposes. The Company records its derivatives on the balance sheet at fair value as either an asset or liability. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the earnings effect of the hedged forecasted transactions in a cash flow hedge. The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income (loss). Amounts reported in accumulated other comprehensive income (loss) related to cash flow hedges are reclassified to operations as an adjustment to interest expense as interest payments are made on the hedged debt transaction.

As of March 31, 2015, the Company had entered into two interest rate swap agreements with current notional amounts of $12.6 million and $6.6 million that were designated as cash flow hedges associated with the Company’s secured, variable‑rate mortgage note payable due 2019 (Note 4).

Fair Value Measurement

The Company estimates fair value of financial and non-financial assets and liabilities based on the framework established in fair value accounting guidance.  Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The hierarchy described below prioritizes inputs to the valuation techniques used in measuring the fair value of assets and liabilities. This hierarchy maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs to be used when available. The hierarchy is broken down into three levels based on the reliability of inputs as follows:

· Level 1—Quoted market prices in active markets for identical assets and liabilities that the Company has the ability to access.

· Level 2—Significant inputs that are observable, either directly or indirectly. These types of inputs would include quoted prices for similar assets or liabilities in active markets, quoted prices for identical assets in inactive markets and market‑corroborated inputs.

· Level 3—Inputs that are unobservable and significant to the overall fair value measurement of the assets or liabilities. These types of inputs include the Company’s own assumptions.

Share‑based Compensation

Certain directors and employees of the Company have been granted long‑term incentive awards, including restricted shares and stock units of the Company’s common stock and profits interests units issued by STORE Holding, which provide them with equity interests as an incentive to remain in the Company’s service and align executives’ interests with those of the Company’s equity holders.

During the three months ended March 31, 2015, the Company granted restricted share awards (RSAs) representing79,018 shares of restricted common stock to its executive officers and certain directors and other employees.  During the same period, 153,331 shares of restricted stock vested and 1,732 shares of restricted stock were forfeited. As of March 31, 2015, the Company had 579,861 restricted common shares outstanding. The Company estimates the fair value of RSAs at the date of grant and recognizes that amount in general and administrative expense ratably over the vesting period at the greater of the amount amortized on a straight‑line basis or the amount vested. The fair value of the RSAs is based on the per-share price of the common stock on the date of the grant. Prior to the Company’s IPO, the fair value was based on the per‑share price of the common stock issued in the Company’s private equity offerings.

In March 2015, the Company issued 348,220 restricted stock units (RSUs) with both a market condition and a service condition to its executive officers.  The number of common shares to be received at vesting will range from zero to 100% of the total RSUs granted based on total shareholder return (TSR) on the Company’s common stock measured against the benchmark TSR of a peer group over a three-year performance period ending December 31, 2017.  The TSR is a measure of stock price appreciation plus dividends paid during the measurement period.  To the extent market and service conditions are met, the RSUs vest 50% at the end of 2017 and, subject to continued employment, 50% at the end of 2018. The Company valued the RSUs using a Monte Carlo simulation model on the date of grant which resulted in a grant date fair value of $4.4 million.  The Monte Carlo simulation was computed based on a volatility assumption of 23.51%, a risk-free interest rate of 0.84% and a dividend yield of zero. The RSUs accrue dividend equivalents which are paid only if the award vests. At March 31, 2015, there were 348,220 RSUs outstanding.

Income Taxes

As a REIT, the Company generally will not be subject to federal income tax; however, it is still subject to state and local income taxes and to federal income and excise tax on its undistributed income. STORE Investment Corporation is the Company’s wholly‑owned taxable REIT subsidiary (TRS) created to engage in non‑qualifying REIT activities. The TRS is subject to federal, state and local income taxes.

Management of the Company determines whether any tax positions taken or expected to be taken meet the “more‑likely‑than‑not” threshold of being sustained by the applicable federal, state or local tax authority. Tax returns filed for 2011 through 2014 are subject to examination by these jurisdictions. As of March 31, 2015 and December 31, 2014, management concluded that there is no tax liability relating to uncertain income tax positions. The Company’s policy is to recognize interest related to any underpayment of income taxes as interest expense and to recognize any penalties as operating expenses. There was no accrual for interest or penalties at March 31, 2015 or December 31, 2014.

Net Income Per Common Share

Net income per common share has been computed pursuant to the guidance in the FASB ASC Topic 260, Earnings Per Share. The guidance requires the classification of the Company’s unvested restricted stock, which contain rights to receive non‑forfeitable dividends, as participating securities requiring the two‑class method of computing net income per common share. The following table is a reconciliation of the numerator and denominator used in the computation of basic and diluted income per common share (dollars in thousands):

	Three Months Ended March 31,
	2015		2014
Numerator:
Net income	$	17,066	$	9,539
Less: earnings attributable to unvested restricted shares		(143)		(116)
Net income used in basic and diluted income per share	$	16,923	$	9,423
Denominator:
Weighted average common shares outstanding		115,215,833		63,436,513
Less: Weighted average number of shares of unvested restricted stock		(582,533)		(411,298)
Weighted average shares outstanding used in basic income per share		114,633,300		63,025,215
Effects of dilutive securities:
Add: Treasury stock method impact of potentially dilutive securities (a)		—		—
Weighted average shares outstanding used in diluted income per share		114,633,300		63,025,215

(a) For the three months ended March 31, 2015 and 2014, excludes 199,528 shares and 62,745 shares, respectively, related to unvested restricted shares as the effect would be antidilutive.

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or the SEC. The Company adopts the new pronouncements as of the specified effective date. When permitted, the Company may elect to early adopt the new pronouncements. Unless otherwise discussed, these new accounting pronouncements include technical corrections to existing guidance or introduce new guidance related to specialized industries or entities and therefore will have minimal, if any, impact on the Company’s financial position or results of operations upon adoption.

In May 2014, the FASB issued Accounting Standards Update (ASU) 2014‑09, Revenue from Contracts with Customers: Topic 606. This new guidance establishes a principles‑based approach for accounting for revenue from contracts with customers. Lease contracts covered by Topic 840, Leases, are excluded from the scope of this new guidance. At the time of issuance, this new standard was effective for public companies for annual reporting periods beginning after December 15, 2016 and early adoption was not permitted. On April 29, 2015, the FASB issued an exposure draft regarding deferral of the effective date of the standard.  The exposure draft proposes that the effective date of the standard for public companies will be for annual reporting periods beginning after December 15, 2017 and early adoption would be permitted but only as of an annual reporting period beginning after December 15, 2016.  As leases are excluded from this guidance, the Company does not anticipate this standard to have a material impact on its financial position, results of operations and cash flows.

In April 2015, the FASB issued ASU No. 2015-03, Interest-Imputation of Interest (Subtopic 835-30) – Simplifying the Presentation of Debt Issuance Costs.  This guidance was issued to simplify the presentation of debt issuance costs by requiring debt issuance costs to be presented as a deduction from the corresponding debt liability and, therefore, make the presentation of debt issuance costs consistent with the presentation of debt discounts or premiums.  This new standard is effective for public companies for annual reporting periods beginning after December 15, 2015, with early adoption permitted.  Upon adoption, the new guidance is required to be applied retrospectively.  The Company is currently evaluating the impact of the adoption of this new standard which is expected to result in reclassifications of certain deferred costs on the Company’s balance sheets but will not have an impact on its results of operations or cash flows.

XML

Commitments and Contingencies (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015
Chief Executive Officer [Member]
Purchase Commitment, Excluding Long-term Commitment [Line Items]
Number of times of basic pay	2
Number of times of the target cash bonus	2
Other Executive Officer [Member]
Purchase Commitment, Excluding Long-term Commitment [Line Items]
Number of times of basic pay	1.5
Number of times of the target cash bonus	1.5
Commitments to fund improvements to real estate properties
Purchase Commitment, Excluding Long-term Commitment [Line Items]
Purchase Commitment, Remaining Minimum Amount Committed	39.0

XML

Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015		Dec. 31, 2014
Real estate investments:
Land and improvements	$ 913,149		$ 843,843
Building and improvements	1,960,169		1,790,530
Intangible lease assets	69,589		60,184
Total real estate investments	2,942,907		2,694,557
Less accumulated depreciation and amortization	(117,106)		(98,671)
Real estate investments, net	2,825,801		2,595,886
Real estate investments held for sale, net	6,809
Loans and direct financing receivables	145,850		111,354
Financing Receivable, Net	145,850		111,354
Net investments	2,978,460	[1]	2,707,240
Cash and cash equivalents	30,324		136,313
Deferred costs, net	36,385		37,136
Other assets	20,684		32,923
Total assets	3,065,853		2,913,612
Liabilities:
Credit facility	162,000
Non-recourse debt obigations of consolidated special purpose entities, net	1,279,220		1,284,151
Dividends payable	28,822		13,123
Accounts payable and accrued expenses	21,067		30,486
Other liabilities	3,044		3,168
Total liabilities	1,494,153		1,330,928
Stockholders’ equity:
Common stock, $0.01 par value per share, 375,000,000 shares authorized, 115,289,827 and 115,212,541 shares issued and outstanding, respectively	1,153		1,152
Capital in excess of par value	1,637,124		1,636,203
Distributions in excess of retained earnings	(66,160)		(54,405)
Accumulated other comprehensive loss	(417)		(266)
Total stockholders’ equity	1,571,700		1,582,684
Total liabilities and stockholders’ equity	$ 3,065,853		$ 2,913,612

[1] The dollar amount of investments includes the investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

XML

Condensed Consolidated Statements of Cash Flows (USD $)	3 Months Ended
	Mar. 31, 2015		Mar. 31, 2014
Operating activities
Net earnings	$ 17,066,000		$ 9,539,000
Adjustments to net income:
Depreciation and amortization	18,892,000		11,561,000
Impairment of Real Estate	1,000,000	[1]	0
Amortization of deferred financing costs	1,546,000		1,359,000
Amortization of debt (premium) and discount, net	(149,000)		(25,000)
Amortization of equity-based compensation	897,000		373,000
Gain on dispositions of real estate			(743,000)
Noncash revenue and other	333,000		(496,000)
Changes in operating assets and liabilities:
Deferred costs	(361,000)		(366,000)
Other assets	82,000		4,149,000
Accounts payable and other liabilities	(3,233,000)		(4,375,000)
Net cash provided by operating activities	36,073,000		20,976,000
Investing activities
Acquisition of and additions to real estate	(264,245,000)		(248,536,000)
Investment in loans and direct financing receivables	(34,683,000)	[1]	(36,046,000)
Collections of principal on loans and direct financing receivables	175,000	[1]	4,884,000
Proceeds from disposition of real estate	48,000		6,687,000
Transfers from (to) restricted deposits	12,996,000		(2,903,000)
Net cash used in investing activities	(285,709,000)		(275,914,000)
Financing activities
Borrowings under credit facilities	172,000,000		167,080,000
Repayments under credit facilities	(10,000,000)
Borrowings under non‑recourse debt obligations of consolidated special purpose entities			26,175,000
Repayments under non‑recourse debt obligations of consolidated special purpose entities	(4,782,000)		(4,291,000)
Financing costs paid	(8,000)		(487,000)
Proceeds from the issuance of common stock	1,000		75,001,000
Offering costs paid	(441,000)
Dividends paid	(13,123,000)		(15,140,000)
Net cash provided by financing activities	143,647,000		248,338,000
Net decrease in cash and cash equivalents	(105,989,000)		(6,600,000)
Cash and cash equivalents, beginning of period	136,313,000		61,814,000
Cash and cash equivalents, end of period	30,324,000		55,214,000
Supplemental disclosure of noncash investing activities:
Accrued tenant improvement advances included in real estate investments			1,885,000
Accrued financing costs	494,000
Supplemental disclosure of cash flow information:
Cash paid during the period for interest	15,358,000		12,805,000
Cash paid during the period for income and franchise taxes	$ 483,000		$ 209,000

[1] The dollar amount of investments includes the investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

XML

Investments (Details) (USD $)	3 Months Ended			12 Months Ended
	Mar. 31, 2015 property		Mar. 31, 2014	Dec. 31, 2014 property
Investments:
Number of property locations of investments (in locations)	1,073			947
Number of owned properties (in properties)	1,059
Number of properties owned as direct financing receivables	12
Number of ground lease interests (in properties)	8
Number of properties which secure certain mortgage loans (in properties)	6
Gross acquisition cost of real estate investments	$ 2,950,000,000
Number of Investment Locations
Gross investments, December 31, 2014	1,073			947
Acquisition of and additions to real estate	123	[1],[2]
Investment in loans and direct financing receivables	3
Gross investments, March 31, 2015	1,073			947
Dollar Amount of Investments
Gross investments, December 31, 2014	2,805,911,000	[3]
Acquisition of and additions to real estate	256,833,000	[1],[2],[3]
Investment in loans and direct financing receivables	(34,683,000)	[3]	(36,046,000)
Sales of real estate	(48,000)	[3]
Principal collections on loans and direct financing receivables	(175,000)	[3]	(4,884,000)
Provision for impairment of real estate	1,000,000	[3]	0
Other	(11,000)	[3]
Gross investments, March 31, 2015	3,096,193,000	[3],[4],[5]		2,805,911,000	[3]
Less accumulated depreciation and amortization	(117,733,000)	[3],[4]
Net investments	2,978,460,000	[3]		2,707,240,000
Tenant improvement advances disbursed	7,400,000
Interested capitalized	200,000
Dollar amount of real estate investments held for sale	7,400,000
Accumulated Depreciation of real estate investments held for sale	$ 600,000

[1] Excludes $7.4 million of tenant improvement advances disbursed in 2015 which were accrued as of December 31, 2014.

[2] Includes $0.2 million of interest capitalized to properties under construction.

[3] The dollar amount of investments includes the investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

[4] Includes the dollar amount of investments ($7.4 million) and the accumulated depreciation ($0.6 million) related to real estate investments held for sale at March 31, 2015.

[5] The dollar amount of investments includes the gross investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables

XML

Investments (Details 3)	3 Months Ended
	Mar. 31, 2015 item state
Real estate investment portfolio | Geographic concentration
Significant Credit and Revenue Concentration
Number of customers	246
Number of states over which real estate investments are dispersed (in states)	46
Concentration Percentage for threshold	10.00%
Real estate investment portfolio | Geographic concentration | Texas
Significant Credit and Revenue Concentration
Concentration Percentage	13.00%
Number of states accounting for 10% or more	1
Real estate investment portfolio | Customer concentration
Significant Credit and Revenue Concentration
Concentration Percentage for threshold	10.00%
Number of customers representing more than 10%	0
Real estate investment portfolio | Customer concentration | Largest customer, investment portfolio | Maximum
Significant Credit and Revenue Concentration
Concentration Percentage	4.00%
Real estate investment portfolio | Concept concentration
Significant Credit and Revenue Concentration
Number of concepts (in categories)	227
Number of concepts representing more than 4% (in categories)	0
Investment portfolio revenues | Customer concentration | Largest customer, investment portfolio revenues | Maximum
Significant Credit and Revenue Concentration
Concentration Percentage	4.00%
Investment portfolio revenues | Concept concentration | Maximum
Significant Credit and Revenue Concentration
Concentration Percentage	4.00%

XML

Organization and Formation Activities

3 Months Ended

Mar. 31, 2015

Organization and Formation Activities

Organization and Formation Activities

1. Organization and Formation Activities

STORE Capital Corporation (STORE Capital or the Company) was formed in Maryland on May 17, 2011 to acquire single‑tenant operational real estate to be leased on a long‑term, net basis to companies that operate across a wide variety of industries within the service, retail and industrial sectors of the United States economy. From time to time, it may also provide mortgage financing to its customers.

On November 21, 2014, the Company completed the initial public offering (IPO) of its common stock.  The shares began trading on the New York Stock Exchange on November 18, 2014 under the ticker symbol “STOR”.  The Company was originally formed as a wholly-owned subsidiary of STORE Holding Company, LLC (STORE Holding), a Delaware limited liability company. In March 2015, STORE Holding redeemed all of its Series A membership interests that were held by members of the Company’s board and senior management through the distribution of common shares of the Company to those members. Following this redemption, the voting interests of STORE Holding are entirely owned by entities managed by a global investment management firm. At March 31, 2015, there were 115,289,827 shares of the Company’s common stock outstanding, of which 82,148,644 shares were held by STORE Holding, representing a 71.25% ownership of the Company.

STORE Capital has made an election to qualify, and believes it is operating in a manner to continue to qualify, as a real estate investment trust (REIT) for federal income tax purposes beginning with its initial taxable year ended December 31, 2011. As a REIT, it will generally not be subject to federal income taxes to the extent that it distributes all of its taxable income to its stockholders and meets other specific requirements.

XML

Condensed Consolidated Balance Sheets (Parenthetical) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Condensed Consolidated Balance Sheet
Common stock, par value per share	$ 0.01	$ 0.01
Common shares, authorized shares	375,000,000	375,000,000
Common shares, issued shares	115,289,827	115,212,541
Common shares, outstanding shares	115,289,827	115,212,541

XML

Investments (Tables)

3 Months Ended

Mar. 31, 2015

Investments:

Schedule of gross real estate and loan activity

During the three months ended March 31, 2015, the Company had the following gross real estate and loan activity (dollars in thousands):

	Number of	Dollar
	Investment	Amount of
	Locations	Investments (a)
Gross investments, December 31, 2014	947	$	2,805,911
Acquisition of and additions to real estate (b)(c)	123		256,833
Investment in loans and direct financing receivables	3		34,683
Sales of real estate	—		(48)
Principal collections on loans and direct financing receivables	—		(175)
Provision for impairment of real estate			(1,000)
Other			(11)
Gross investments, March 31, 2015 (d)			3,096,193
Less accumulated depreciation and amortization (d)			(117,733)
Net investments, March 31, 2015	1,073	$	2,978,460

(a) The dollar amount of investments includes the investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

(b) Excludes $7.4 million of tenant improvement advances disbursed in 2015 which were accrued as of December 31, 2014.

(c) Includes $0.2 million of interest capitalized to properties under construction.

Includes the dollar amount of investments ($7.4 million) and the accumulated depreciation ($0.6 million) related to real estate investments held for sale at March 31, 2015.

Schedule of investment portfolio diversification by industry

The following table shows information regarding the diversification of the Company’s total investment portfolio among the different industries in which its tenants and borrowers operate as of March 31, 2015 (dollars in thousands):

				Percentage of
	Number of	Dollar		Total Dollar
	Investment	Amount of		Amount of
	Locations	Investments (a)		Investments
Restaurants	540	$	866,861	28	%
Health clubs	44		243,689	8
Early childhood education centers	121		229,183	7
Movie theaters	27		210,866	7
Sporting goods stores	15		122,693	4
Furniture stores	22		121,566	4
Colleges and professional schools	6		79,101	2
All other service industries	178		672,043	22
All other retail industries	53		223,768	7
All industrial	67		326,423	11
	1,073	$	3,096,193	100	%

The dollar amount of investments includes the gross investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

Schedule detailing intangible lease assets and related accumulated amortization

The following details intangible lease assets and related accumulated amortization (in thousands):

	March 31,		December 31,
	2015		2014
In-place lease assets	$	52,017	$	47,359
Above-market lease assets		10,273		5,526
Ground lease interest assets		7,299		7,299
Total intangible lease assets		69,589		60,184
Accumulated amortization		(7,606)		(6,006)
Net intangible lease assets	$	61,983	$	54,178

Schedule of future minimum rentals to be received under operating leases

Scheduled future minimum rentals to be received under the remaining noncancelable term of the operating leases at March 31, 2015, are as follows (in thousands):

Remainder of 2015	$	186,836
2016		249,820
2017		249,906
2018		250,041
2019		250,203
2020		248,557
Thereafter		2,278,194
Total future minimum rentals (a)	$	3,713,557

Includes $43.2 million (approximately $3.6 million annually through February 2027) of future rentals associated with two leases terminated subsequent to March 31, 2015.

Schedule summarizing loans and direct financing receivables

The Company’s loans and direct financing receivables are summarized below (dollars in thousands):

	Stated
	Interest		Maturity	March 31,		December 31,
Type	Rate		Date	2015		2014
Mortgage loan receivable	8.50	%	Apr. 2015	$	4,300	$	4,300
Mortgage loan receivable	9.09	%	Jan. 2017		1,933		1,933
Mortgage loan receivable	8.35	%	Jan. 2028		3,772		3,775
Mortgage loan receivable	8.75	%	Jul. 2032		23,969		23,998
Mortgage loan receivable	7.45	%	Jan. 2035		500		—
Mortgage loan receivable	9.00	%	Mar. 2053		14,580		14,595
Mortgage loan receivable	8.75	%	Jun. 2053		6,352		6,357
Mortgage loan receivable	8.50	%	Jun. 2053		6,691		6,697
Mortgage loan receivable	8.25	%	Aug. 2053		3,335		3,337
Mortgage loan receivable (a)	8.50	%	Feb. 2055		28,500		—
Total mortgage loans receivable					93,932		64,992
Equipment loan receivable					—		94
Equipment loan receivable	7.75	%	Mar. 2017		1,063		—
Total principal amount outstanding—loans receivable					94,995		65,086
Unamortized loan origination costs					883		497
Direct financing receivables					49,972		45,771
Total loans and direct financing receivables				$	145,850	$	111,354

Mortgage loan receivable has an initial interest rate of 8.50%and is subject to increases over the term of the loan.  The loan allows for prepayment in whole, but not in part, with penalties ranging from 20% to 70% depending on the timing of the prepayment.

Schedule of maturities of loans receivable

Absent prepayments, scheduled maturities are expected to be as follows (in thousands):

	Scheduled		Balloon		Total
	Principal		Payments		Payments
Remainder of 2015	$	233	$	4,300	$	4,533
2016		332		—		332
2017		361		2,996		3,357
2018		394		—		394
2019		429		—		429
2020		449		—		449
Thereafter		61,632		23,869		85,501
Total principal repayments	$	63,830	$	31,165	$	94,995

Schedule of the components of the investments accounted for as direct financing receivables

The components of the investments accounted for as direct financing receivables as of March 31, 2015 were as follows (in thousands):

Minimum lease payments receivable	$	129,018
Estimated residual value of leased assets		5,076
Unearned income		(84,122)
Net investment	$	49,972

XML

Document and Entity Information	3 Months Ended
	Mar. 31, 2015	May 14, 2015
Document and Entity Information
Entity Registrant Name	STORE CAPITAL Corp
Entity Central Index Key	0001538990
Document Type	10-Q
Document Period End Date	Mar. 31, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		115,288,537
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q1

XML

Debt (Tables)

3 Months Ended

Mar. 31, 2015

Debt

Schedule of Debt

The non‑recourse debt obligations of the consolidated special purpose entity subsidiaries are summarized below (dollars in thousands):

		Coupon		Outstanding Balance
	Maturity	Interest		March 31,		December 31,
	Date	Rate		2015		2014
Non-recourse net-lease mortgage notes:
Series 2012-1, Class A	Aug. 2019	5.77	%	$	206,698	$	207,503
Series 2013-1, Class A-1	Mar. 2020	4.16	%		145,259		145,876
Series 2013-2, Class A-1	Jul. 2020	4.37	%		104,324		104,740
Series 2013-3, Class A-1	Nov. 2020	4.24	%		75,473		75,767
Series 2014-1, Class A-1	Apr. 2021	4.21	%		119,500		119,650
Series 2013-1, Class A-2	Mar. 2023	4.65	%		98,776		99,196
Series 2013-2, Class A-2	Jul. 2023	5.33	%		94,574		94,951
Series 2013-3, Class A-2	Nov. 2023	5.21	%		98,016		98,398
Series 2014-1, Class A-2	Apr. 2024	5.00	%		139,417		139,592
Non-recourse mortgage notes payable:
$21,443 note issued July 2005 (a)	Aug. 2015	5.26	% (a)		18,849		18,956
$4,000 note issued August 2006 (b)	Sept. 2016	6.33	% (b)		3,299		3,326
$3,800 note issued September 2006 (c)	Oct. 2016	6.47	% (c)		3,498		3,512
$7,088 note issued April 2007 (d)	May 2017	6.00	% (d)		6,648		6,676
$4,400 note issued August 2007 (e)	Sept. 2017	6.7665	% (e)		3,780		3,807
$8,000 note issued January 2012; assumed in December 2013	Jan. 2018	4.778	%		7,444		7,511
$20,530 note issued December 2011 and amended February 2012	Jan. 2019	5.275	% (f)		19,202		19,317
$6,500 note issued December 2012	Dec. 2019	4.806	%		6,170		6,207
$2,956 note issued June 2013	Jun. 2020	3.173	% (g)		2,812		2,827
$16,100 note issued February 2014	Mar. 2021	4.83	%		15,771		15,857
$13,000 note issued May 2012	May 2022	5.195	%		12,253		12,326
$14,950 note issued July 2012	Aug. 2022	4.95	%		13,774		13,863
$26,000 note issued August 2012	Sept. 2022	5.05	%		24,660		24,805
$6,400 note issued November 2012	Dec. 2022	4.71	%		6,090		6,127
$11,895 note issued March 2013	Apr. 2023	4.73	%		11,410		11,478
$17,500 note issued August 2013	Sept. 2023	5.46	%		17,003		17,091
$10,075 note issued March 2014	Apr. 2024	5.10	%		9,947		9,984
$7,750 note issued February 2013	Mar. 2038	4.81	% (h)		7,424		7,468
$6,944 notes issued March 2013	Apr. 2038	4.50	% (i)		6,643		6,684
					1,278,714		1,283,495
Unamortized net premium					506		656
Total non-recourse debt obligations of consolidated special purpose entities				$	1,279,220	$	1,284,151

(a) Note was assumed in June 2014 at a premium; estimated effective yield at assumption of 3.69%.

(b) Note was assumed in July 2012 at a premium; estimated effective yield at assumption of 5.15%.

(c) Note was assumed in April 2014 at a premium; estimated effective yield at assumption of 3.88%.

(d) Note was assumed in December 2013 at a premium; estimated effective yield at assumption of 4.45%.

(e) Note was assumed in September 2014 at a premium; estimated effective yield at assumption of 3.40%.

(f) Note is a variable‑rate note which resets monthly at one‑month LIBOR + 3.50%. The Company has entered into two interest rate swap agreements that effectively convert the floating rate on a $12.6 million portion and a $6.6 million portion of this mortgage note payable to fixed rates of 5.299% and 5.230%, respectively (Note 2).

(g) Note is a variable‑rate note which resets monthly at one‑month LIBOR + 3.00%; rate shown is effective rate at March 31, 2015.

(h) Interest rate is effective for first 10 years and will reset to greater of (1) initial rate plus 400 basis points or (2) Treasury rate plus 400 basis points.

(i) Interest rate is effective for first 10 years and will reset to the lender’s then prevailing interest rate.

Schedule of Maturities of Long-term Debt

As of March 31, 2015, the scheduled debt maturities, including balloon payments, during the next five years and thereafter are as follows (in thousands):

	Scheduled		Balloon
	Principal		Payments		Total
Remainder of 2015	$	14,408	$	18,710	$	33,118
2016		19,789		6,549		26,338
2017		20,517		9,921		30,438
2018		21,070		6,665		27,735
2019		19,765		213,539		233,304
2020		13,942		295,985		309,927
Thereafter		36,906		580,948		617,854
	$	146,397	$	1,132,317	$	1,278,714

XML

Condensed Consolidated Statements of Income (USD $)	3 Months Ended
	Mar. 31, 2015		Mar. 31, 2014
Revenues:
Rental revenues	$ 58,838,000		$ 37,534,000
Interest income on loans and direct financing receivables	2,598,000		1,790,000
Other income	23,000		5,000
Total revenues	61,459,000		39,329,000
Expenses:
Interest	17,229,000		14,405,000
Transaction costs	259,000		398,000
Property costs	295,000		37,000
General and administrative	6,635,000		4,183,000
Depreciation and amortization	18,892,000		11,561,000
Provision for impairment of real estate	1,000,000	[1]	0
Total expenses	44,310,000		30,584,000
Income from continuing operations before income taxes	17,149,000		8,745,000
Income tax expense	83,000		52,000
Income from continuing operations	17,066,000		8,693,000
Income from discontinued operations			846,000
Net income	$ 17,066,000		$ 9,539,000
Net income per share of common stock—basic and diluted:
Continuing operations (in dollars per share)	$ 0.15		$ 0.14
Discontinued operations (in dollars per share)			$ 0.01
Net income (in dollars per share)	$ 0.15		$ 0.15
Weighted average common shares outstanding:
Weighted average shares outstanding used in basic income per share (in shares)	114,633,300		63,025,215
Weighted average shares outstanding used in diluted income per share (in shares)	114,633,300		63,025,215
Dividends declared per common sshare (in dollars per share)	$ 0.2500		$ 0.2395

[1] The dollar amount of investments includes the investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

XML

Income from Discontinued Operations

3 Months Ended

Mar. 31, 2015

Income from Discontinued Operations

Income from Discontinued Operations

6. Income from Discontinued Operations

Periodically, the Company may sell real estate properties it owns. Effective January 1, 2014, the Company adopted ASU No. 2014‑08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (ASU 2014‑08), under which only disposals representing a strategic shift in operations of the Company and that have (or will have) a major effect on the Company’s operations and financial results are to be presented as discontinued operations. The Company was required to continue to classify any property disposal or property classified as held for sale as of December 31, 2013 as discontinued operations prospectively; therefore, the gains and losses from these property dispositions and all operations from these properties were reclassified to discontinued operations, net of any related income tax, in the consolidated statements of income. This presentation has no impact on net income or cash flow. The Company did not classify any additional property disposals as discontinued operations subsequent to December 31, 2013.

Amounts reclassified to discontinued operations during the three months ended March 31, 2014 included $103,000 of income from real estate operations and $743,000 of gain on disposition of properties related to assets that had been classified as held for sale prior to the Company’s adoption of ASU 2014‑08.

XML

Stockholders’ Equity

3 Months Ended

Mar. 31, 2015

Stockholders’ Equity

Stockholders' Equity Note Disclosure [Text Block]

5. Stockholders’ Equity

On November 3, 2014, the Company’s board of directors declared a 1.67‑for‑one split of its common stock effected through a dividend to its stockholders. The stock dividend was treated as a stock split for accounting purposes; the $0.01 par value of the common stock was unchanged. The Company declared dividends payable to common stockholders totaling $28.8 million and $15.1 million during the three months ended March 31, 2015 and 2014, respectively. 

On March 30, 2015, STORE Holding redeemed all of its Series A membership interests that were held by members of the Company’s board and senior management through the distribution of 653,382 common shares of the Company to those members. STORE Holding held 82,148,644 of the Company’s common shares at March 31, 2015 and 82,802,026 common shares at December 31, 2014. 

XML

Investments (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended		12 Months Ended
	Mar. 31, 2015 property		Dec. 31, 2014 property
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	1,073		947
Dollar Amount of Investments	$ 3,096,193	[1],[2],[3]	$ 2,805,911	[1]
Percentage of Total Dollar Amount of Investments	100.00%
Restaurants
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	540
Dollar Amount of Investments	866,861	[3]
Percentage of Total Dollar Amount of Investments	28.00%
Health clubs
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	44
Dollar Amount of Investments	243,689	[3]
Percentage of Total Dollar Amount of Investments	8.00%
Early childhood education centers
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	121
Dollar Amount of Investments	229,183	[3]
Percentage of Total Dollar Amount of Investments	7.00%
Movie theaters
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	27
Dollar Amount of Investments	210,866	[3]
Percentage of Total Dollar Amount of Investments	7.00%
Sporting goods stores
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	15
Dollar Amount of Investments	122,693	[3]
Percentage of Total Dollar Amount of Investments	4.00%
Furniture stores
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	22
Dollar Amount of Investments	121,566	[3]
Percentage of Total Dollar Amount of Investments	4.00%
Colleges and professional schools
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	6
Dollar Amount of Investments	79,101	[3]
Percentage of Total Dollar Amount of Investments	2.00%
All other service industries
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	178
Dollar Amount of Investments	672,043	[3]
Percentage of Total Dollar Amount of Investments	22.00%
All other retail industries
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	53
Dollar Amount of Investments	223,768	[3]
Percentage of Total Dollar Amount of Investments	7.00%
Industrial
Information regarding the diversification of Company's investment portfolio among different industries [Line items]
Number of property locations of investments (in locations)	67
Dollar Amount of Investments	$ 326,423	[3]
Percentage of Total Dollar Amount of Investments	11.00%

[1] The dollar amount of investments includes the investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.

[2] Includes the dollar amount of investments ($7.4 million) and the accumulated depreciation ($0.6 million) related to real estate investments held for sale at March 31, 2015.

[3] The dollar amount of investments includes the gross investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables

XML

Organization and Formation Activities (Details)	Mar. 31, 2015
Related Party Transaction [Line Items]
Common stock outstanding	115,289,827
STORE Holding Company, majority shareholder of the Company
Related Party Transaction [Line Items]
Percentage ownership of the entity	71.25%
Common stock outstanding	82,148,644

XML

Summary of Significant Accounting Principles (Policies)

3 Months Ended

Mar. 31, 2015

Summary of Significant Accounting Principles

Basis of Accounting and Principles of Consolidation

Basis of Accounting and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (SEC). In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of interim periods are not necessarily indicative of the results for the entire year.  Certain information and note disclosures, normally included in financial statements prepared in accordance with GAAP, have been condensed or omitted from these statements and, accordingly, these statements should be read in conjunction with the Company’s audited consolidated financial statements as filed with the SEC in its Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

These consolidated statements include the accounts of STORE Capital Corporation and its subsidiaries which are wholly‑owned and controlled by the Company through its voting interest. One of the Company’s wholly‑owned subsidiaries, STORE Capital Advisors, LLC, provides all of the general and administrative services for the day‑to‑day operations of the consolidated group, including property acquisition and lease origination, real estate portfolio management and marketing, accounting and treasury services. The remaining subsidiaries were formed to acquire and hold real estate investments or to facilitate non‑recourse secured borrowing activities. Generally, the initial operations of the real estate subsidiaries are funded by an interest‑bearing intercompany loan from STORE Capital Corporation, and such intercompany loan is repaid when the subsidiary issues long‑term debt secured by its properties. All intercompany account balances and transactions have been eliminated in consolidation.

Certain of the Company’s wholly‑owned consolidated subsidiaries were formed as special purpose entities. Each special purpose entity is a separate legal entity and is the sole owner of its assets and liabilities. The assets of the special purpose entities are not available to pay or otherwise satisfy obligations to the creditors of any owner or affiliate of the special purpose entity. At March 31, 2015 and December 31, 2014, assets totaling $2.7 billion and $2.5 billion, respectively, were held and third-party liabilities totaling $1.3 billion were owed by these special purpose entities and are included in the accompanying consolidated balance sheets.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period. Although management believes its estimates are reasonable, actual results could differ from those estimates.

Segment Reporting

Segment Reporting

The Financial Accounting Standards Board’s (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting, established standards for the manner in which enterprises report information about operating segments. The Company views its operations as one reportable segment.

Accounting for Real Estate Investments

Accounting for Real Estate Investments

STORE Capital records the acquisition of real estate properties at cost, including acquisition and closing costs. The Company allocates the cost of real estate properties to the tangible and intangible assets and liabilities acquired based on their estimated relative fair values. Real estate properties subject to an existing in‑place lease at the date of acquisition are recorded as business combinations and each tangible and intangible asset and liability acquired is recorded at fair value. Management uses multiple sources to estimate fair value, including independent appraisals and information obtained about each property as a result of its pre‑acquisition due diligence and its marketing and leasing activities. The Company expenses transaction costs associated with real estate acquisitions accounted for as business combinations in the period incurred.

In‑place lease intangibles are valued based on management’s estimates of lost rent and carrying costs during the time it would take to locate a tenant if the property were vacant, considering current market conditions and costs to execute similar leases. In estimating lost rent and carrying costs, management considers market rents, real estate taxes, insurance, costs to execute similar leases including leasing commissions and other related costs. The value assigned to in‑place leases is amortized on a straight‑line basis as a component of depreciation and amortization expense typically over the remaining term of the related leases.

The fair value of any above‑market and below‑market leases is estimated based on the present value of the difference between the contractual amounts to be paid pursuant to the in‑place lease and management’s estimate of current market lease rates for the property, measured over a period equal to the remaining term of the lease. Capitalized above‑market lease intangibles are amortized over the remaining term of the respective leases as a decrease to rental revenue. Below‑market lease intangibles are amortized as an increase in rental revenue over the remaining term of the respective leases plus the fixed‑rate renewal periods on those leases, if any. Should a lease terminate early, the unamortized portion of any related lease intangible is immediately recognized in operations.

The Company’s real estate portfolio is depreciated using the straight‑line method over the estimated remaining useful life of the properties, which generally ranges from 30 to 40 years for buildings and is 15 years for land improvements. Properties classified as held for sale are recorded at the lower of their carrying value or their fair value, less anticipated closing costs. Any properties classified as held for sale are not depreciated.

Real Estate Investments, Impairment

Impairment

STORE Capital reviews its real estate investments and related lease intangibles periodically for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable through operations. Management considers factors such as expected future undiscounted cash flows, estimated residual value, market trends (such as the effects of leasing demand and competition) and other factors including bona fide purchase offers received from third parties in making this assessment. These factors are classified as Level 3 inputs within the fair value hierarchy. An asset is considered impaired if the carrying value of the asset exceeds its estimated undiscounted cash flows and the impairment is calculated as the amount by which the carrying value of the asset exceeds its estimated fair value. Estimating future cash flows is highly subjective and such estimates could differ materially from actual results. During the three months ended March 31, 2015, the Company recorded a provision for impairment of its real estate of $1.0 million.  No impairment charges were recorded during the three months ended March 31, 2014.

Real Estate Investments, Revenue Recognition

Revenue Recognition

STORE Capital leases real estate to its tenants under long‑term net leases that are predominantly classified as operating leases. Direct costs associated with lease origination, offset by any lease origination fees received, are deferred and amortized over the related lease term as an adjustment to rental revenue. Substantially all of the leases are triple‑net, which provide that the lessees are responsible for the payment of all property operating expenses, including property taxes, maintenance and insurance. The Company may collect property taxes from its customers and remit those taxes to governmental authorities; such property taxes are presented on a net basis in the consolidated income statements.

The Company’s leases generally provide for rent escalations throughout the lease terms. For leases that provide for specific contractual escalations, rental revenue is recognized on a straight‑line basis so as to produce a constant periodic rent over the term of the lease. Accordingly, accrued rental revenue, calculated as the aggregate difference between the rental revenue recognized on a straight‑line basis and scheduled rents, represents unbilled rent receivables that the Company will receive only if the tenants make all rent payments required through the expiration of the lease. The Company provides an estimated reserve for uncollectible straight‑line rental revenue based on management’s assessment of the risks inherent in those lease contracts, giving consideration to industry default rates for long‑term receivables. There was $5.8 million and $4.7 million of accrued straight‑line rental revenue, net of allowances of $2.1 million and $1.7 million, at March 31, 2015 and December 31, 2014, respectively, included in other assets on the consolidated balance sheets.  Leases that have contingent rent escalators indexed to future increases in the Consumer Price Index (CPI) may adjust over a one‑year period or over multiple‑year periods. Generally, these escalators increase rent at the lesser of (a) 1 to 1.25 times the increase in the CPI over a specified period or (b) a fixed percentage. Because of the volatility and uncertainty with respect to future changes in the CPI, the Company’s inability to determine the extent to which any specific future change in the CPI is probable at each rent adjustment date during the entire term of these leases and the Company’s view that the multiplier does not represent a significant leverage factor, increases in rental revenue from leases with this type of escalator are recognized only after the changes in the rental rates have actually occurred.

For leases that have contingent rentals that are based on a percentage of the tenant’s gross sales, the Company recognizes contingent rental revenue when the threshold upon which the contingent lease payment is based is actually reached. Less than 1.5% of the Company’s investment portfolio is subject to leases that provide for contingent rent based on a percentage of the tenant’s gross sales.

The Company suspends revenue recognition if the collectibility of amounts due pursuant to a lease is not reasonably assured or if the tenant’s monthly lease payments become more than 60 days past due, whichever is earlier. The Company reviews its rent receivables for collectibility on a regular basis, taking into consideration changes in factors such as the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area where the property is located. In the event that the collectibility of a receivable with respect to any tenant is in doubt, a provision for uncollectible amounts will be established or a direct write‑off of the specific rent receivable will be made. As of March 31, 2015, the Company had a $0.3 million provision for uncollectible contractual rent payments due from tenants; there was no provision at December 31, 2014.

Loans Receivable

Loans Receivable

STORE Capital holds its loans receivable for long‑term investment. Loans receivable are carried at amortized cost, including related unamortized discounts or premiums, if any.

Revenue Recognition

The Company recognizes interest income on loans receivable using the effective‑interest method applied on a loan‑by‑loan basis. Direct costs associated with originating loans are offset against any related fees received and the balance, along with any premium or discount, is deferred and amortized as an adjustment to interest income over the term of the related loan receivable using the effective interest method. A loan receivable is placed on nonaccrual status when the loan has become 60 days past due, or earlier if management determines that full recovery of the contractually specified payments of principal and interest is doubtful. While on nonaccrual status, interest income is recognized only when received. As of March 31, 2015 and December 31, 2014, there were no loans on nonaccrual status.

Impairment and Provision for Loan Losses

The Company periodically evaluates the collectibility of its loans receivable, including accrued interest, by analyzing the underlying property‑level economics and trends, collateral value and quality and other relevant factors in determining the adequacy of its allowance for loan losses. A loan is determined to be impaired when, in management’s judgment based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Specific allowances for loan losses are provided for impaired loans on an individual loan basis in the amount by which the carrying value exceeds the estimated fair value of the underlying collateral less disposition costs. There was no allowance for loan losses at March 31, 2015 or December 31, 2014.

Direct Financing Receivables

Direct Financing Receivables

Certain of the Company’s real estate investment transactions are accounted for as direct financing leases. The Company records the direct financing receivables at their net investment, determined as the aggregate minimum lease payments and the estimated residual value of the leased property less unearned income. The unearned income is recognized over the life of the related contracts so as to produce a constant rate of return on the net investment in the asset.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents include cash and highly liquid investment securities with maturities at acquisition of three months or less. The Company invests cash primarily in money‑market funds of a major financial institution, consisting predominantly of U.S. Government obligations.

Restricted Cash and Escrow Deposits

Restricted Cash and Escrow Deposits

The Company had $2.4 million and $15.4 million of restricted cash and deposits in escrow at March 31, 2015 and December 31, 2014, respectively which were included in other assets on the consolidated balance sheets.

Deferred Costs

Deferred Costs

Deferred costs consist principally of financing costs related to the issuance of the Company’s debt. Deferred financing costs are amortized as an increase to interest expense over the term of the related debt instrument using the effective interest method.  Deferred costs also include lease origination costs, which are amortized as a decrease to rental revenue over the term of the respective lease.

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

The Company may enter into derivatives contracts as part of its overall financing strategy to manage the Company’s exposure to changes in interest rates associated with current and/or future debt issuances. The Company does not use derivatives for trading or speculative purposes. The Company records its derivatives on the balance sheet at fair value as either an asset or liability. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the earnings effect of the hedged forecasted transactions in a cash flow hedge. The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income (loss). Amounts reported in accumulated other comprehensive income (loss) related to cash flow hedges are reclassified to operations as an adjustment to interest expense as interest payments are made on the hedged debt transaction.

As of March 31, 2015, the Company had entered into two interest rate swap agreements with current notional amounts of $12.6 million and $6.6 million that were designated as cash flow hedges associated with the Company’s secured, variable‑rate mortgage note payable due 2019 (Note 4).

Fair Value Measurement

Fair Value Measurement

The Company estimates fair value of financial and non-financial assets and liabilities based on the framework established in fair value accounting guidance.  Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The hierarchy described below prioritizes inputs to the valuation techniques used in measuring the fair value of assets and liabilities. This hierarchy maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs to be used when available. The hierarchy is broken down into three levels based on the reliability of inputs as follows:

· Level 1—Quoted market prices in active markets for identical assets and liabilities that the Company has the ability to access.

· Level 2—Significant inputs that are observable, either directly or indirectly. These types of inputs would include quoted prices for similar assets or liabilities in active markets, quoted prices for identical assets in inactive markets and market‑corroborated inputs.

Level 3—Inputs that are unobservable and significant to the overall fair value measurement of the assets or liabilities. These types of inputs include the Company’s own assumptions.

Share‑based Compensation

Share‑based Compensation

Certain directors and employees of the Company have been granted long‑term incentive awards, including restricted shares and stock units of the Company’s common stock and profits interests units issued by STORE Holding, which provide them with equity interests as an incentive to remain in the Company’s service and align executives’ interests with those of the Company’s equity holders.

During the three months ended March 31, 2015, the Company granted restricted share awards (RSAs) representing79,018 shares of restricted common stock to its executive officers and certain directors and other employees.  During the same period, 153,331 shares of restricted stock vested and 1,732 shares of restricted stock were forfeited. As of March 31, 2015, the Company had 579,861 restricted common shares outstanding. The Company estimates the fair value of RSAs at the date of grant and recognizes that amount in general and administrative expense ratably over the vesting period at the greater of the amount amortized on a straight‑line basis or the amount vested. The fair value of the RSAs is based on the per-share price of the common stock on the date of the grant. Prior to the Company’s IPO, the fair value was based on the per‑share price of the common stock issued in the Company’s private equity offerings.

In March 2015, the Company issued 348,220 restricted stock units (RSUs) with both a market condition and a service condition to its executive officers.  The number of common shares to be received at vesting will range from zero to 100% of the total RSUs granted based on total shareholder return (TSR) on the Company’s common stock measured against the benchmark TSR of a peer group over a three-year performance period ending December 31, 2017.  The TSR is a measure of stock price appreciation plus dividends paid during the measurement period.  To the extent market and service conditions are met, the RSUs vest 50% at the end of 2017 and, subject to continued employment, 50% at the end of 2018. The Company valued the RSUs using a Monte Carlo simulation model on the date of grant which resulted in a grant date fair value of $4.4 million.  The Monte Carlo simulation was computed based on a volatility assumption of 23.51%, a risk-free interest rate of 0.84% and a dividend yield of zero. The RSUs accrue dividend equivalents which are paid only if the award vests. At March 31, 2015, there were 348,220 RSUs outstanding.

Income Taxes

Income Taxes

As a REIT, the Company generally will not be subject to federal income tax; however, it is still subject to state and local income taxes and to federal income and excise tax on its undistributed income. STORE Investment Corporation is the Company’s wholly‑owned taxable REIT subsidiary (TRS) created to engage in non‑qualifying REIT activities. The TRS is subject to federal, state and local income taxes.

Management of the Company determines whether any tax positions taken or expected to be taken meet the “more‑likely‑than‑not” threshold of being sustained by the applicable federal, state or local tax authority. Tax returns filed for 2011 through 2014 are subject to examination by these jurisdictions. As of March 31, 2015 and December 31, 2014, management concluded that there is no tax liability relating to uncertain income tax positions. The Company’s policy is to recognize interest related to any underpayment of income taxes as interest expense and to recognize any penalties as operating expenses. There was no accrual for interest or penalties at March 31, 2015 or December 31, 2014.

Net Income Per Common Share

Net Income Per Common Share

Net income per common share has been computed pursuant to the guidance in the FASB ASC Topic 260, Earnings Per Share. The guidance requires the classification of the Company’s unvested restricted stock, which contain rights to receive non‑forfeitable dividends, as participating securities requiring the two‑class method of computing net income per common share. The following table is a reconciliation of the numerator and denominator used in the computation of basic and diluted income per common share (dollars in thousands):

	Three Months Ended March 31,
	2015		2014
Numerator:
Net income	$	17,066	$	9,539
Less: earnings attributable to unvested restricted shares		(143)		(116)
Net income used in basic and diluted income per share	$	16,923	$	9,423
Denominator:
Weighted average common shares outstanding		115,215,833		63,436,513
Less: Weighted average number of shares of unvested restricted stock		(582,533)		(411,298)
Weighted average shares outstanding used in basic income per share		114,633,300		63,025,215
Effects of dilutive securities:
Add: Treasury stock method impact of potentially dilutive securities (a)		—		—
Weighted average shares outstanding used in diluted income per share		114,633,300		63,025,215

(a) For the three months ended March 31, 2015 and 2014, excludes 199,528 shares and 62,745 shares, respectively, related to unvested restricted shares as the effect would be antidilutive.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or the SEC. The Company adopts the new pronouncements as of the specified effective date. When permitted, the Company may elect to early adopt the new pronouncements. Unless otherwise discussed, these new accounting pronouncements include technical corrections to existing guidance or introduce new guidance related to specialized industries or entities and therefore will have minimal, if any, impact on the Company’s financial position or results of operations upon adoption.

In May 2014, the FASB issued Accounting Standards Update (ASU) 2014‑09, Revenue from Contracts with Customers: Topic 606. This new guidance establishes a principles‑based approach for accounting for revenue from contracts with customers. Lease contracts covered by Topic 840, Leases, are excluded from the scope of this new guidance. At the time of issuance, this new standard was effective for public companies for annual reporting periods beginning after December 15, 2016 and early adoption was not permitted. On April 29, 2015, the FASB issued an exposure draft regarding deferral of the effective date of the standard.  The exposure draft proposes that the effective date of the standard for public companies will be for annual reporting periods beginning after December 15, 2017 and early adoption would be permitted but only as of an annual reporting period beginning after December 15, 2016.  As leases are excluded from this guidance, the Company does not anticipate this standard to have a material impact on its financial position, results of operations and cash flows.

In April 2015, the FASB issued ASU No. 2015-03, Interest-Imputation of Interest (Subtopic 835-30) – Simplifying the Presentation of Debt Issuance Costs.  This guidance was issued to simplify the presentation of debt issuance costs by requiring debt issuance costs to be presented as a deduction from the corresponding debt liability and, therefore, make the presentation of debt issuance costs consistent with the presentation of debt discounts or premiums.  This new standard is effective for public companies for annual reporting periods beginning after December 15, 2015, with early adoption permitted.  Upon adoption, the new guidance is required to be applied retrospectively.  The Company is currently evaluating the impact of the adoption of this new standard which is expected to result in reclassifications of certain deferred costs on the Company’s balance sheets but will not have an impact on its results of operations or cash flows.

XML

Commitments and Contingencies

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies

Commitments and Contingencies

7. Commitments and Contingencies

In the normal course of business, the Company enters into various types of commitments to purchase real estate properties. These commitments are generally subject to the Company’s customary due diligence process and, accordingly, a number of specific conditions must be met before the Company is obligated to purchase the properties. At the time the Company purchases a property, the Company may also agree to fund future improvements to the property. As of March 31, 2015, the Company had approximately $39.0 million in commitments to fund improvements to real estate properties previously acquired which will generally result in increases to the rental revenue due under the related contracts.

The Company has employment agreements with each of its executive officers which will expire in November 2018. The agreements provide for minimum annual base salaries and annual incentive compensation based on the satisfactory achievement of reasonable performance criteria and objectives to be adopted by the Company’s Board of Directors each year.  In addition, each officer is eligible to receive equity awards as determined by the Company’s Board of Directors. In the event an executive officer is terminated without cause or terminates employment for good reason, the Company is liable for a lump‑sum severance payment in an amount equal to, in the case of the Company’s Chief Executive Officer, the sum of (i) two times his base salary and (ii) two times the target cash bonus for which he was eligible in the prior fiscal year (whether or not received); and, in the case of the Company’s other executive officers, the sum of (i) 1.5 times his or her base salary and (ii) 1.5 times the target cash bonus for which he or she was eligible in the prior fiscal year (whether or not received); plus, in the case of all executive officers, certain other specified termination benefits.  In the event of a termination without cause, as defined in the employment agreements, the executive officer is entitled to immediate vesting of any and all outstanding unvested shares of the Company’s restricted stock that he or she has been awarded as part of the Company’s incentive compensation program.  For unvested RSUs, in the event of a qualified termination, as defined in the award agreement, the executive officer is entitled to a portion of any earned award, as determined under the award agreement, based on the elapsed performance period.

XML

Fair Value Measurements

3 Months Ended

Mar. 31, 2015

Fair Value Measurements

Fair Value Measurements

8. Fair Value of Financial Instruments

The Company’s derivatives are required to be measured at fair value in the Company’s consolidated financial statements on a recurring basis.  Derivatives are measured under a market approach, using prices obtained from a nationally recognized pricing service and pricing models with market observable inputs such as interest rates and equity index levels. These measurements are classified as Level 2 within the fair value hierarchy. The fair value of the Company’s derivatives (interest rate swaps) at March 31, 2015 and December 31, 2014 was a liability of $417,000 and $266,000, respectively, included in other liabilities on the consolidated balance sheets.

In addition to the disclosures for assets and liabilities required to be measured at fair value at the balance sheet date, companies are required to disclose the estimated fair values of all financial instruments, even if they are not carried at their fair value. The fair values of financial instruments are estimates based upon market conditions and perceived risks at March 31, 2015 and December 31, 2014. These estimates require management’s judgment and may not be indicative of the future fair values of the assets and liabilities.

Financial assets and liabilities for which the carrying values approximate their fair values include cash and cash equivalents, restricted cash and escrow deposits, accounts receivable, accounts payable and tenant deposits. Generally these assets and liabilities are short‑term in duration and are recorded at fair value on the consolidated balance sheets. The Company believes that the carrying value of borrowings under its credit facility approximate fair value based upon their nature, terms and variable interest rate. Additionally, the Company believes the carrying values of its fixed‑rate loans receivable approximate fair values based on market quotes for comparable instruments or discounted cash flow analysis using estimates of the amount and timing of future cash flows, market rates and credit spreads.

The estimated fair values of the non‑recourse debt obligations of consolidated special purpose entities have been derived based on market observable inputs such as interest rates and discounted cash flow analyses using estimates of the amount and timing of future cash flows, market rates and credit spreads. These measurements are classified as Level 2 within the fair value hierarchy. At March 31, 2015, the Company’s non‑recourse debt obligations of consolidated special purpose entities had a carrying value of $1,279.2 million and an estimated fair value of $1,377.7 million. At December 31, 2014, these debt obligations had a carrying value of $1,284.2 million and an estimated fair value of $1,349.0 million.

XML

Summary of Significant Accounting Principles (Tables)

3 Months Ended

Mar. 31, 2015

Summary of Significant Accounting Principles

Reconciliation of the numerator and denominator used in the computation of basic and diluted income per common share

The following table is a reconciliation of the numerator and denominator used in the computation of basic and diluted income per common share (dollars in thousands):

	Three Months Ended March 31,
	2015		2014
Numerator:
Net income	$	17,066	$	9,539
Less: earnings attributable to unvested restricted shares		(143)		(116)
Net income used in basic and diluted income per share	$	16,923	$	9,423
Denominator:
Weighted average common shares outstanding		115,215,833		63,436,513
Less: Weighted average number of shares of unvested restricted stock		(582,533)		(411,298)
Weighted average shares outstanding used in basic income per share		114,633,300		63,025,215
Effects of dilutive securities:
Add: Treasury stock method impact of potentially dilutive securities (a)		—		—
Weighted average shares outstanding used in diluted income per share		114,633,300		63,025,215

(a) For the three months ended March 31, 2015 and 2014, excludes 199,528 shares and 62,745 shares, respectively, related to unvested restricted shares as the effect would be antidilutive.

XML

Summary of Significant Accounting Principles (Details 2) (USD $)	3 Months Ended		1 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Mar. 31, 2015	Dec. 31, 2014
Income Tax Examination, Penalties and Interest Accrued
Uncertain income tax positions	$ 0		$ 0	$ 0
Accrual for interest or penalities	0		0	0
Numerator:
Net income	17,066,000	9,539,000
Less: earnings attributable to unvested restricted shares	(143,000)	(116,000)
Net income used in basic and diluted income per share	16,923,000	9,423,000
Denominator:
Weighted average common shares outstanding	115,215,833	63,436,513
Less: Weighted average number of shares of unvested restricted stock (in shares)	(582,533)	(411,298)
Weighted average shares outstanding used in basic income per share (in shares)	114,633,300	63,025,215
Effects of dilutive securities:
Weighted average shares outstanding used in diluted income per share (in shares)	114,633,300	63,025,215
Antidilutive unvested restricted shares (in shares)	199,528	62,745
Interest rate swaps
Derivative Instruments and Hedging Activities
Number of agreements	2		2
Derivative one [Member] | Designated as hedging instrument | Interest rate swaps
Derivative Instruments and Hedging Activities
Current notional amounts	12,600,000		12,600,000
Derivative two [Member] | Designated as hedging instrument | Interest rate swaps
Derivative Instruments and Hedging Activities
Current notional amounts	6,600,000		6,600,000
Restricted Stock
Share‑based Compensation
Granted in period (in shares)	79,018
Vested in period (in shares)	153,331
Forfeited in period (in shares)	(1,732)
Outstanding (in shares)	579,861		579,861
Restricted stock units | Executive Officer [Member]
Share‑based Compensation
Grant date fair value			$ 4,400,000
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
Volatility rate (as a percent)			23.51%
Risk free interest rate (as a percent)			0.84%
Dividend yield (as a percent)			0.00%
Restricted stock units | Executive Officer [Member] | Maximum
Share‑based Compensation
Number of common shares to be received at vesting (as a percent)			100.00%
Restricted stock units | Executive Officer [Member] | Vesting Based On Service And Market Conditions[Member]
Share‑based Compensation
Granted in period (in shares)			348,220
Outstanding (in shares)	348,220		348,220
Period over which TSR of the company measured against the benchmark TSR of a peer group			3 years
Restricted stock units | Executive Officer [Member] | Vesting Based On Service And Market Conditions[Member] | Minimum
Share‑based Compensation
Number of common shares to be received at vesting (as a percent)			0.00%
Restricted stock units | Executive Officer [Member] | Vesting Based On Service And Market Conditions[Member] | 2017
Share‑based Compensation
Vesting percentage (as a percent)			50.00%
Restricted stock units | Executive Officer [Member] | Vesting Based On Service And Market Conditions[Member] | 2018
Share‑based Compensation
Vesting percentage (as a percent)			50.00%

XML

Investments (Details 5) (USD $)	3 Months Ended
	Mar. 31, 2015 loan		Dec. 31, 2014
Loans and direct financing receivables
Number of loans receivable	11
Gross carrying amount of loans receivable	$ 95,800,000
Number of mortgage loans	10
Number of short-term mortgage loans	2
Amortization period of long-term mortgage loans	40 years
Mortgage loans receivable	93,932,000		64,992,000
Total principal repayments	94,995,000		65,086,000
Unamortized loan origination costs	883,000		497,000
Direct financing receivables	49,972,000		45,771,000
Total loans and direct financing receivables	145,850,000		111,354,000
Minimum
Loans and direct financing receivables
Long‑term mortgage loans receivable prepayment penalty rate	1.00%
Maximum
Loans and direct financing receivables
Long‑term mortgage loans receivable prepayment penalty rate	5.00%
Mortgage loan receivable, 0.085 interest rate, Apr. 2015 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	8.50%
Mortgage loans receivable	4,300,000		4,300,000
Mortgage loan receivable, 0.0909 interest rate, Jan. 2017 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	9.09%
Mortgage loans receivable	1,933,000		1,933,000
Mortgage loan receivable, 0.0835 interest rate, Jan. 2028 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	8.35%
Mortgage loans receivable	3,772,000		3,775,000
Mortgage loan receivable, 0.0875 interest rate, Jul. 2032 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	8.75%
Mortgage loans receivable	23,969,000		23,998,000
Mortgage loan receivable, 0.0745 interest rate, Jan. 2035 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	7.45%
Mortgage loans receivable	500,000
Mortgage loan receivable, 0.09 interest rate, Mar. 2053 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	9.00%
Mortgage loans receivable	14,580,000		14,595,000
Mortgage loan receivable, 0.0875 interest rate, Jun. 2053 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	8.75%
Mortgage loans receivable	6,352,000		6,357,000
Mortgage loan receivable, 0.085 interest rate, Jun. 2053 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	8.50%
Mortgage loans receivable	6,691,000		6,697,000
Mortgage loan receivable, 0.0825 interest rate, Aug. 2053 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	8.25%
Mortgage loans receivable	3,335,000		3,337,000
Mortgage loan receivable, 0.085 interest rate, Feb. 2055 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	8.50%	[1]
Mortgage loans receivable	28,500,000	[1]
Mortgage loan receivable, 0.085 interest rate, Feb. 2055 maturity date | Minimum
Loans and direct financing receivables
Prepayment penalities	20.00%
Mortgage loan receivable, 0.085 interest rate, Feb. 2055 maturity date | Maximum
Loans and direct financing receivables
Prepayment penalities	70.00%
Equipment loan receivable, 0.10 interest rate, Jan. 2015 maturity date
Loans and direct financing receivables
Equipment loans receivable			94,000
Equipment loan receivable, 0.0775 interest rate, Mar. 2017 maturity date
Loans and direct financing receivables
Stated Interest Rate (as a percent)	7.75%
Equipment loans receivable	$ 1,063,000

[1] Mortgage loan receivable has an initial interest rate of 8.50% and is subject to increases over the term of the loan. The loan allows for prepayment in whole, but not in part, with penalties ranging from 20% to 70% depending on the timing of the prepayment.

XML

Condensed Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Condensed Consolidated Statement of Comprehensive Income
Net income	$ 17,066	$ 9,539
Other comprehensive (loss) income:
Change in unrealized losses on cash flow hedges	(228)	(110)
Cash flow hedge losses reclassified to interest expense	77	79
Total other comprehensive (loss) income	(151)	(31)
Total comprehensive income	$ 16,915	$ 9,508

XML

Debt

3 Months Ended

Mar. 31, 2015

Debt

Debt

4. Debt

Credit Facilities

In September 2014, the Company entered into a new $300 million unsecured revolving credit facility with a group of lenders which replaced the Company’s previous two secured credit facilities that aggregated $300 million. The facility is used to partially fund real estate acquisitions pending the issuance of long-term, fixed-rate debt.

This facility, which includes an accordion feature that allows the size of the facility to be increased up to $500 million, is for an initial term of three years andincludes a one-year extension option subject to certain conditions and the payment of a 0.2% extension fee. The facility is recourse to the Company and includes a guaranty from STORE Capital Acquisitions, LLC, one of the Company’s direct wholly-owned subsidiaries. Borrowings under this facility require monthly payments of interest at a rate selected by the Company of either (1) one-month LIBOR plus a credit spread ranging from 1.75% to 2.50%, or (2) the Base Rate, as defined in the agreement, plus a credit spread ranging from 0.75% to 1.50%. The credit spread used is based on the Company’s leverage ratio as defined in the agreement; based on the most recent leverage ratio calculations, borrowings under the facility made on or after April 1, 2015 will bear interest at one-month LIBOR plus 1.75%. The Company must also pay a 0.25% non-use fee on the unused portion of the facility. Borrowing availability under the facility is limited to 50% of the value of the Company’s eligible unencumbered assets at any point in time. At March 31, 2015, the Company had $162 million of borrowings outstanding and a pool of eligible unencumbered assets aggregating approximately $1.1 billion.

The Company is subject to various financial and nonfinancial covenants under this unsecured credit facility including a maximum leverage of 65%,  a minimum EBITDA to fixed charges ratio of 1.5 to 1, minimum consolidated net worth of $600 million plus 75% of additional equity raised after September 2014, and a maximum dividend payout ratio limited to 95% of Funds from Operations, all as defined in the agreement. As of March 31, 2015, the Company was in compliance with these covenants.

On April 8, 2015, the Company entered into a four-month (including the one-month extension option), $50 million unsecured loan facility with a bank as a temporary supplement to borrowing capacity under its unsecured revolving credit facility.  This loan facility is subject to the same borrowing limitations and covenants as the unsecured revolving credit facility discussed above.  Borrowings under this loan facility require monthly payments of interest at a rate selected by the Company of either (1) one-month LIBOR plus 2.00%, or (2) the Base Rate, as defined in the agreement.

Prior to September 19, 2014, the Company had two bank credit facilities that were secured by real estate properties which were pledged as collateral under the facilities as well as the Company’s equity interests in certain of its special purpose entity subsidiaries and the Company’s holdings of the Class B notes issued under its STORE Master Funding debt program (see below). These previous secured credit facilities bore interest at one-month LIBOR plus a credit spread ranging from 2.45% to 3.00%.

The financing costs related to the establishment of the Company’s credit facilities are deferred and amortized to interest expense over the term of the credit facilities. At March 31, 2015 and December 31, 2014, unamortized financing costs related to the Company’s credit facility totaled $2.1 million and $2.4 million, respectively.

Non‑Recourse Debt Obligations of Consolidated Special Purpose Entities

During 2012, the Company implemented a debt issuance program pursuant to which certain of its consolidated special purpose entities issue multiple series of non‑recourse net‑lease mortgage notes from time to time that are collateralized by the assets owned by these entities and their related leases (collateral). One of the principal features of the program is that, as additional series of notes are issued, new collateral is contributed to the collateral pool thereby increasing the size and diversity of the collateral pool for the benefit of all noteholders, including those who invested in prior series. Another feature of the program is the ability to substitute collateral from time to time subject to meeting certain prescribed conditions and criteria. The notes are generally segregated into Class A amortizing notes and Class B non‑amortizing notes. The Company has retained each of the Class B notes which aggregate $78.0 million at March 31, 2015.

The Class A notes require monthly principal and interest payments with a balloon payment due at maturity and these notes may be prepaid at any time, subject to a yield maintenance prepayment premium. As of March 31, 2015, the aggregate collateral pool securing the net‑lease mortgage notes is comprised primarily of single tenant commercial real estate properties with an aggregate investment amount of approximately $1.6 billion.

On April 16, 2015, the consolidated special purpose entities issued an additional series of net-lease mortgage notes consisting of $365.0 million of Class A notes and $30.0 million of Class B notes.  The Class A notes are segregated into two tranches:  $95.0 million of seven-year notes with an interest rate of 3.75% and $270.0 million of ten-year notes with an interest rate of 4.17%.  The Class B notes were retained by the Company.

A number of additional consolidated special purpose entity subsidiaries of the Company have financed their owned real estate properties with traditional first mortgage debt. The notes require monthly principal and interest payments with balloon payments at maturity. In general, these mortgage notes payable can be prepaid in whole or in part upon payment of a yield maintenance premium. The mortgage notes payable are collateralized by real estate properties owned by these consolidated special purpose entity subsidiaries with an aggregate investment amount of approximately $327.3 million at March 31, 2015.

The mortgage notes payable, which are obligations of the consolidated special purpose entities as described in Note 2, contain various covenants customarily found in mortgage notes, including a limitation on the issuing entity’s ability to incur additional indebtedness on the underlying real estate. Although this mortgage debt generally is non‑recourse, there are customary limited exceptions to recourse for matters such as fraud, misrepresentation, gross negligence or willful misconduct, misapplication of payments, bankruptcy and environmental liabilities. Certain of the mortgage notes payable also require the posting of cash reserves with the lender or trustee if specified coverage ratios are not maintained by the Company or one of its tenants. As of March 31, 2015, the Company had one variable-rate mortgage note (outstanding principal balance of $19.2 million) which had effectively been converted to a fixed-rate note through the use of two interest rate swaps. The Company has an agreement with the counterparty to the interest rate swaps which contains a provision that, if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, the Company could also be declared in default on its interest rate swap obligations. As of March 31, 2015, the termination value of the Company’s interest rate swaps was a liability of approximately $0.5 million.

Financing costs related to the issuance of the non‑recourse debt obligations are deferred and amortized to interest expense over the terms of the related notes. As of March 31, 2015 and December 31, 2014, unamortized financing costs related to all non‑recourse debt obligations of the consolidated special purpose entities totaled $30.1 million and $30.9 million, respectively.

The non‑recourse debt obligations of the consolidated special purpose entity subsidiaries are summarized below (dollars in thousands):

		Coupon		Outstanding Balance
	Maturity	Interest		March 31,		December 31,
	Date	Rate		2015		2014
Non-recourse net-lease mortgage notes:
Series 2012-1, Class A	Aug. 2019	5.77	%	$	206,698	$	207,503
Series 2013-1, Class A-1	Mar. 2020	4.16	%		145,259		145,876
Series 2013-2, Class A-1	Jul. 2020	4.37	%		104,324		104,740
Series 2013-3, Class A-1	Nov. 2020	4.24	%		75,473		75,767
Series 2014-1, Class A-1	Apr. 2021	4.21	%		119,500		119,650
Series 2013-1, Class A-2	Mar. 2023	4.65	%		98,776		99,196
Series 2013-2, Class A-2	Jul. 2023	5.33	%		94,574		94,951
Series 2013-3, Class A-2	Nov. 2023	5.21	%		98,016		98,398
Series 2014-1, Class A-2	Apr. 2024	5.00	%		139,417		139,592
Non-recourse mortgage notes payable:
$21,443 note issued July 2005 (a)	Aug. 2015	5.26	% (a)		18,849		18,956
$4,000 note issued August 2006 (b)	Sept. 2016	6.33	% (b)		3,299		3,326
$3,800 note issued September 2006 (c)	Oct. 2016	6.47	% (c)		3,498		3,512
$7,088 note issued April 2007 (d)	May 2017	6.00	% (d)		6,648		6,676
$4,400 note issued August 2007 (e)	Sept. 2017	6.7665	% (e)		3,780		3,807
$8,000 note issued January 2012; assumed in December 2013	Jan. 2018	4.778	%		7,444		7,511
$20,530 note issued December 2011 and amended February 2012	Jan. 2019	5.275	% (f)		19,202		19,317
$6,500 note issued December 2012	Dec. 2019	4.806	%		6,170		6,207
$2,956 note issued June 2013	Jun. 2020	3.173	% (g)		2,812		2,827
$16,100 note issued February 2014	Mar. 2021	4.83	%		15,771		15,857
$13,000 note issued May 2012	May 2022	5.195	%		12,253		12,326
$14,950 note issued July 2012	Aug. 2022	4.95	%		13,774		13,863
$26,000 note issued August 2012	Sept. 2022	5.05	%		24,660		24,805
$6,400 note issued November 2012	Dec. 2022	4.71	%		6,090		6,127
$11,895 note issued March 2013	Apr. 2023	4.73	%		11,410		11,478
$17,500 note issued August 2013	Sept. 2023	5.46	%		17,003		17,091
$10,075 note issued March 2014	Apr. 2024	5.10	%		9,947		9,984
$7,750 note issued February 2013	Mar. 2038	4.81	% (h)		7,424		7,468
$6,944 notes issued March 2013	Apr. 2038	4.50	% (i)		6,643		6,684
					1,278,714		1,283,495
Unamortized net premium					506		656
Total non-recourse debt obligations of consolidated special purpose entities				$	1,279,220	$	1,284,151

(a) Note was assumed in June 2014 at a premium; estimated effective yield at assumption of 3.69%.

(b) Note was assumed in July 2012 at a premium; estimated effective yield at assumption of 5.15%.

(c) Note was assumed in April 2014 at a premium; estimated effective yield at assumption of 3.88%.

(d) Note was assumed in December 2013 at a premium; estimated effective yield at assumption of 4.45%.

(e) Note was assumed in September 2014 at a premium; estimated effective yield at assumption of 3.40%.

(f) Note is a variable‑rate note which resets monthly at one‑month LIBOR + 3.50%. The Company has entered into two interest rate swap agreements that effectively convert the floating rate on a $12.6 million portion and a $6.6 million portion of this mortgage note payable to fixed rates of 5.299% and 5.230%, respectively (Note 2).

(g) Note is a variable‑rate note which resets monthly at one‑month LIBOR + 3.00%; rate shown is effective rate at March 31, 2015.

(h) Interest rate is effective for first 10 years and will reset to greater of (1) initial rate plus 400 basis points or (2) Treasury rate plus 400 basis points.

(i) Interest rate is effective for first 10 years and will reset to the lender’s then prevailing interest rate.

As of March 31, 2015, the scheduled debt maturities, including balloon payments, during the next five years and thereafter are as follows (in thousands):

	Scheduled		Balloon
	Principal		Payments		Total
Remainder of 2015	$	14,408	$	18,710	$	33,118
2016		19,789		6,549		26,338
2017		20,517		9,921		30,438
2018		21,070		6,665		27,735
2019		19,765		213,539		233,304
2020		13,942		295,985		309,927
Thereafter		36,906		580,948		617,854
	$	146,397	$	1,132,317	$	1,278,714

XML

Investments (Details 6) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Scheduled loan receivable maturities
Remainder of 2015	$ 4,533
2016	332
2017	3,357
2018	394
2019	429
2020	449
Thereafter	85,501
Total principal repayments	94,995	65,086
Components of investments accounted for as direct financing receivables
Minimum lease payments receivable	129,018
Estimated residual value of leased assets	5,076
Unearned income	(84,122)
Net investment	49,972	45,771
Scheduled principal
Scheduled loan receivable maturities
Remainder of 2015	233
2016	332
2017	361
2018	394
2019	429
2020	449
Thereafter	61,632
Total principal repayments	63,830
Balloon payments
Scheduled loan receivable maturities
Remainder of 2015	4,300
2017	2,996
Thereafter	23,869
Total principal repayments	$ 31,165

XML

Summary of Significant Accounting Principles (Details) (USD $)	3 Months Ended			12 Months Ended
	Mar. 31, 2015 segment		Mar. 31, 2014	Dec. 31, 2014
Basis of Accounting and Principles of Consolidation
Assets owned	$ 3,065,853,000			$ 2,913,612,000
Liabilities owed	1,494,153,000			1,330,928,000
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract]
Number of Reportable Segments	1
Accounting for Real Estate Investments
Accrued straight‑line rental revenue, net of allowance	5,800,000			4,700,000
Accrued straight‑line rental revenue, allowance	2,100,000			1,700,000
Leases indexed to increases in the CPI, minimum adjustment period	1 year
Leases indexed to increases in the CPI, minimum multiplier increasing rent (in multipliers)	1
Leases indexed to increases in the CPI, maximum multiplier increasing rent (in multipliers)	1.25
Portion of investment portfolio subject to contingent rent based upon tenant sales (as a percent)	1.50%
Impairments
Provision for impairment of real estate	1,000,000	[1]	0
Loans receivable
Allowance for loan losses	0			0
Restricted Cash and Escrow Deposits
Restricted Cash and Deposits	2,400,000			15,400,000
Rent receivables
Loans receivable
Maximum past due period for tenant lease payments causing suspension of revenue recognition.	60 days
Provision for uncollectible contractual rent payments	300,000			0
Loans receivable
Loans receivable
Maximum past due period for loans payments causing nonaccrual status.	60 days
Loans on nonaccrual status (in loans)	0
Buildings | Maximum
Accounting for Real Estate Investments
Property, Plant and Equipment, Useful Life	40 years
Buildings | Minimum
Accounting for Real Estate Investments
Property, Plant and Equipment, Useful Life	30 years
Land improvements
Accounting for Real Estate Investments
Property, Plant and Equipment, Useful Life	15 years
Consolidated special purpose entities
Basis of Accounting and Principles of Consolidation
Assets owned	2,700,000,000			2,500,000,000
Liabilities owed	$ 1,300,000,000			$ 1,300,000,000

[1] The dollar amount of investments includes the investment in land, buildings, improvements and lease intangibles related to real estate investments as well as the carrying amount of the loans and direct financing receivables.