EX-99.1 2 exhibit991-8xkx20140630.htm EXHIBIT 99.1 Exhibit 99.1 - 8-K - 2014.06.30

    

NEWS RELEASE
For information contact:
Kevin B. Habicht
Chief Financial Officer
(407) 265-7348    FOR IMMEDIATE RELEASE
August 5, 2014


SECOND QUARTER 2014 OPERATING RESULTS AND INCREASED 2014 FFO GUIDANCE
ANNOUNCED BY NATIONAL RETAIL PROPERTIES, INC.

Orlando, Florida, August 5, 2014 – National Retail Properties, Inc. (NYSE: NNN), a real estate investment trust, today announced its operating results for the quarter ended June 30, 2014. Highlights include:

Operating Results:
•
Revenues and net earnings, FFO, Recurring FFO and AFFO available to common stockholders and diluted per share amounts:
 
Quarter Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2014
 
2013
 
2014
 
2013
 
(in thousands, except per share data)
Revenues
$
105,613

 
$
96,295

 
$
209,677

 
$
188,759

 
 
 
 
 
 
 
 
Net earnings available to common stockholders
$
36,713

 
$
32,724

 
$
71,187

 
$
62,029

Net earnings per common share
$
0.30

 
$
0.27

 
$
0.58

 
$
0.52

 
 
 
 
 
 
 
 
FFO available to common stockholders
$
61,690

 
$
54,284

 
$
123,331

 
$
108,925

FFO per common share
$
0.50

 
$
0.45

 
$
1.01

 
$
0.92

 
 
 
 
 
 
 
 
Recurring FFO available to common stockholders
$
61,767

 
$
54,284

 
$
123,566

 
$
109,684

Recurring FFO per common share
$
0.50

 
$
0.45

 
$
1.01

 
$
0.93

 
 
 
 
 
 
 
 
AFFO available to common stockholders
$
62,710

 
$
57,400

 
$
125,428

 
$
114,414

AFFO per common share
$
0.51

 
$
0.47

 
$
1.02

 
$
0.97


Second Quarter 2014 Highlights:
•
FFO per share and Recurring FFO per share increased 11.1% over prior year results
•
AFFO per share increased 8.5% over prior year results
•
Portfolio occupancy increased to 98.5% at June 30, 2014, as compared to 98.2% at March 31, 2014 and December 31, 2013
•
Invested $92.0 million in 34 properties with an aggregate 213,000 square feet of gross leasable area at an initial cash yield of 7.5%
•
Sold 10 properties for $15.0 million producing $3.1 million of gains on sales, net of income tax
•
Raised $54.2 million in net proceeds from the issuance of 1,535,102 common shares
•
Issued $350 million principal amount of 3.90% senior unsecured notes due 2024 generating net proceeds of $346.1 million
•
Paid off $150 million principal amount of 6.25% senior unsecured notes due 2014



First Half 2014 Highlights:
•
FFO per share increased 9.8% over prior year results
•
Recurring FFO per share increased 8.6% over prior year results
•
AFFO per share increased 5.2% over prior year results
•
Invested $186.0 million in 81 properties with an aggregate 522,000 square feet of gross leasable area at an initial cash yield of 7.6%
•
Sold 14 properties for $26.2 million producing $4.3 million of gains on sales, net of income tax and noncontrolling interest
•
Raised $421.4 million of new long-term capital at attractive pricing
•
Raised $75.3 million in net proceeds from the issuance of 2,151,605 common shares
•
Raised $346.1 million in net proceeds from the issuance of 3.90% senior unsecured notes due 2024
•
Paid off $150 million principal amount of 6.25% senior unsecured notes due 2014
•
Paid off $46.4 million bank credit facility balance leaving full availability of $500 million

On July 17, 2014, Standard & Poor's Rating Services raised National Retail Properties unsecured debt rating to BBB+.

National Retail Properties announced an increase in 2014 FFO guidance from a range of $1.95 to $2.00 to a range of $2.00 to $2.04 per share before any impairment expense. 2014 AFFO is estimated to be $2.05 to $2.09 per share. The FFO guidance equates to net earnings before any gains or losses from the sale of real estate of $1.12 to $1.16 per share, plus $0.88 per share of expected real estate depreciation, amortization and impairments. The guidance is based on current plans and assumptions and subject to risks and uncertainties more fully described in this press release and the company's reports filed with the Securities and Exchange Commission.

Craig Macnab, Chief Executive Officer, commented: "We continue to source attractive retail properties for acquisition. With the rent growth provided in the leases, our investment returns remain very attractive. Also, we continue to raise well-priced long-term capital. This has allowed us to increase our 2014 FFO guidance. Our recently announced quarterly dividend increase paves the way for 2014 becoming the 25th consecutive year of annual dividend increases and is a record that puts NNN in a notably small group of public companies."

National Retail Properties invests primarily in high-quality retail properties subject generally to long-term, net leases. As of June 30, 2014, the company owned 1,927 properties in 47 states with a gross leasable area of approximately 20.8 million square feet. For more information on the company, visit www.nnnreit.com.

Management will hold a conference call on August 5, 2014, at 10:30 a.m. ET to review these results. The call can be accessed on the National Retail Properties web site live at http://www.nnnreit.com. For those unable to listen to the live broadcast, a replay will be available on the company’s web site. In addition, a summary of any earnings guidance given on the call will be posted to the company’s web site.

Statements in this press release that are not strictly historical are “forward-looking” statements. Forward-looking statements involve known and unknown risks, which may cause the company’s actual future results to differ materially from expected results. These risks include, among others, general economic conditions, local real estate conditions, changes in interest rates, increases in operating costs, the preferences and financial condition of the company's tenants, the availability of capital, risks related to the company's status as a REIT and the profitability of the company’s taxable subsidiary. Additional information concerning these and other factors that could cause actual results to differ materially from these forward-looking statements is contained from time to time in the company’s Securities and Exchange Commission (“SEC”) filings, including, but not limited to, the company’s Annual Report on Form 10-K. Copies of each filing may be obtained from the company or the SEC. Such forward-looking statements should be regarded solely as reflections of the company’s current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. National Retail Properties, Inc. undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.

The reported results are preliminary and not final and there can be no assurance that the results will not vary from the final information filed on Form 10-Q with the SEC for the quarter and six months ended June 30, 2014. In the opinion of management, all adjustments considered necessary for a fair presentation of these reported results have been made.

Funds From Operations, commonly referred to as FFO, is a relative non-GAAP financial measure of operating performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO is defined by the National Association of Real Estate Investment Trusts (“NAREIT”) and is used by the company as follows: net earnings (computed in accordance with GAAP) plus depreciation and amortization of assets unique to the real estate industry, excluding gains (or including losses), any applicable taxes and noncontrolling interests on the disposition of certain assets, the company’s share of these items from the company’s unconsolidated partnerships and any impairment charges on a depreciable real estate asset.


2

FFO is generally considered by industry analysts to be the most appropriate measure of performance of real estate companies. FFO does not necessarily represent cash provided by operating activities in accordance with GAAP and should not be considered an alternative to net earnings as an indication of the company’s performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers FFO an appropriate measure of performance of an equity REIT because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure. The company’s computation of FFO may differ from the methodology for calculating FFO used by other equity REITs, and therefore, may not be comparable to such other REITs. A reconciliation of net earnings (computed in accordance with GAAP) to FFO, as defined by NAREIT, is included in the financial information accompanying this release.

Adjusted Funds From Operations (“AFFO”) is a non-GAAP financial measure of operating performance used by many companies in the REIT industry. AFFO adjusts FFO for certain non-cash items that reduce or increase net income in accordance with GAAP. AFFO should not be considered an alternative to net earnings, as an indication of the company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers AFFO a useful supplemental measure of the company’s performance. The company’s computation of AFFO may differ from the methodology for calculating AFFO used by other equity REITs, and therefore, may not be comparable to such other REITs. A reconciliation of net earnings (computed in accordance with GAAP) to AFFO is included in the financial information accompanying this release.
In April 2014, the FASB issued Accounting Standards Update ("ASU") 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposal of Components of an Entity,” effective for fiscal years beginning on or after December 15, 2014, with early adoption permitted beginning January 1, 2014. Under ASU 2014-08, only disposals representing a strategic shift in operations are to be presented as discontinued operations. NNN has elected early adoption of ASU 2014-08. This requires the Company 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 revenues and expenses related to these properties are presented as discontinued operations as of June 30, 2014. The Company did not classify any additional properties as discontinued operations subsequent to December 31, 2013. The adoption of ASU 2014-08 did not have a significant impact on NNN’s financial position or results of operations.





3

National Retail Properties, Inc.
(in thousands, except per share data)
(unaudited)

 
 
Quarter Ended
 
Six Months Ended
 
 
June 30,
 
June 30,
 
 
2014
 
2013
 
2014
 
2013
Income Statement Summary
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenues:
 
 
 
 
 
 
 
 
Rental and earned income
 
$
101,388

 
$
92,152

 
$
200,977

 
$
180,627

Real estate expense reimbursement from tenants
 
3,228

 
3,184

 
6,460

 
6,181

Interest and other income from real estate transactions
 
543

 
371

 
1,334

 
756

Interest income on commercial mortgage residual interests
 
454

 
588

 
906

 
1,195

 
 
105,613

 
96,295

 
209,677

 
188,759

 
 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
 
General and administrative
 
8,074

 
9,412

 
16,989

 
17,677

Real estate
 
4,746

 
4,363

 
9,086

 
8,327

Depreciation and amortization
 
28,007

 
22,545

 
56,019

 
46,261

Impairment – commercial mortgage residual interests valuation
 
77

 
—

 
235

 
—

Impairment losses and other charges
 
89

 
263

 
485

 
3,115

 
 
40,993

 
36,583

 
82,814

 
75,380

 
 
 
 
 
 
 
 
 
Other expenses (revenues):
 
 
 
 
 
 
 
 
Interest and other income
 
(94
)
 
(377
)
 
(158
)
 
(711
)
Interest expense
 
21,761

 
23,529

 
42,040

 
45,488

 
 
21,667

 
23,152

 
41,882

 
44,777

 
 
 
 
 
 
 
 
 
Income tax benefit (expense)
 
(441
)
 
(460
)
 
(349
)
 
370

 
 
 
 
 
 
 
 
 
Earnings from continuing operations
 
42,512

 
36,100

 
84,632

 
68,972

 
 
 
 
 
 
 
 
 
Earnings (loss) from discontinued operations, net of income tax expense
 
18

 
1,506

 
(18
)
 
2,537

Earnings before gain on disposition of real estate, net of income tax expense
 
42,530

 
37,606

 
84,614

 
71,509

 
 
 
 
 
 
 
 
 
Gain on disposition of real estate, net of income tax expense
 
3,054

 
—

 
4,810

 
—

 
 
 
 
 
 
 
 
 
Earnings including noncontrolling interests
 
45,584

 
37,606

 
89,424

 
71,509

 
 
 
 
 
 
 
 
 
Loss (earnings) attributable to noncontrolling interests:
 
 
 
 
 
 
 
 
Continuing operations
 
(13
)
 
38

 
(520
)
 
206

Discontinued operations
 
—

 
(158
)
 
—

 
(163
)
 
 
(13
)
 
(120
)
 
(520
)
 
43

 
 
 
 
 
 
 
 
 
Net earnings attributable to NNN
 
45,571

 
37,486

 
88,904

 
71,552

Series D preferred stock dividends
 
(4,762
)
 
(4,762
)
 
(9,523
)
 
(9,523
)
Series E preferred stock dividends
 
(4,096
)
 
—

 
(8,194
)
 
—

Net earnings available to common stockholders
 
$
36,713

 
$
32,724

 
$
71,187

 
$
62,029

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

4

National Retail Properties, Inc.
(in thousands, except per share data)
(unaudited)

 
 
Quarter Ended
 
Six Months Ended
 
 
June 30,
 
June 30,
 
 
2014
 
2013
 
2014
 
2013
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
Basic
 
122,490

 
117,813

 
122,036

 
115,664

Diluted
 
122,833

 
120,866

 
122,393

 
118,404

 
 
 
 
 
 
 
 
 
Net earnings per share available to common stockholders:
 
 
 
 
 
 
 
 
Basic:
 
 
 
 
 
 
 
 
Continuing operations
 
$
0.30

 
$
0.27

 
$
0.58

 
$
0.51

Discontinued operations
 
—

 
0.01

 
—

 
0.02

Net earnings
 
$
0.30

 
$
0.28

 
$
0.58

 
$
0.53

 
 
 
 
 
 
 
 
 
Diluted:
 
 
 
 
 
 
 
 
Continuing operations
 
$
0.30

 
$
0.26

 
$
0.58

 
$
0.50

Discontinued operations
 
—

 
0.01

 
—

 
0.02

Net earnings
 
$
0.30

 
$
0.27

 
$
0.58

 
$
0.52

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


5

National Retail Properties, Inc.
(in thousands, except per share data)
(unaudited)

 
 
Quarter Ended
 
Six Months Ended
 
 
June 30,
 
June 30,
 
 
2014
 
2013
 
2014
 
2013
Funds From Operations (FFO) Reconciliation:
 
 
 
 
 
 
 
 
Net earnings available to common stockholders
 
$
36,713

 
$
32,724

 
$
71,187

 
$
62,029

Real estate depreciation and amortization:
 
 
 
 
 
 
 
 
Continuing operations
 
27,945

 
22,489

 
55,898

 
46,149

Discontinued operations
 
—

 
68

 
—

 
157

Gain on disposition of real estate, net of income tax and noncontrolling interest
 
(3,057
)
 
(2,150
)
 
(4,302
)
 
(2,655
)
Impairment charges – real estate
 
89

 
1,153

 
548

 
3,245

Total FFO adjustments
 
24,977

 
21,560

 
52,144

 
46,896

FFO available to common stockholders
 
$
61,690

 
$
54,284

 
$
123,331

 
$
108,925

 
 
 
 
 
 
 
 
 
FFO per common share:
 
 
 
 
 
 
 
 
Basic
 
$
0.50

 
$
0.46

 
$
1.01

 
$
0.94

Diluted
 
$
0.50

 
$
0.45

 
$
1.01

 
$
0.92

 
 
 
 
 
 
 
 
 
Recurring Funds from Operations Reconciliation:
 
 
 
 
 
 
 
 
Net earnings available to common shareholders
 
$
36,713

 
$
32,724

 
$
71,187

 
$
62,029

Total FFO adjustments
 
24,977

 
21,560

 
52,144

 
46,896

FFO available to common shareholders
 
61,690

 
54,284

 
123,331

 
108,925

 
 
 
 
 
 
 
 
 
Impairment – commercial mortgage residual interests valuation
 
77

 
—

 
235

 
—

Impairment charges – real estate
 
—

 
—

 
—

 
759

Total Recurring FFO adjustments
 
77

 
—

 
235

 
759

Recurring FFO available to common shareholders
 
$
61,767

 
$
54,284

 
$
123,566

 
$
109,684

 
 
 
 
 
 
 
 
 
Recurring FFO per common share:
 
 
 
 
 
 
 
 
Basic
 
$
0.50

 
$
0.46

 
$
1.01

 
$
0.95

Diluted
 
$
0.50

 
$
0.45

 
$
1.01

 
$
0.93

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

6

National Retail Properties, Inc.
(in thousands, except per share data)
(unaudited)

 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Six Months Ended
 
 
June 30,
 
June 30,
 
 
2014
 
2013
 
2014
 
2013
Adjusted Funds From Operations (AFFO) Reconciliation:
 
 
 
 
 
 
 
 
Net earnings available to common shareholders
 
$
36,713

 
$
32,724

 
$
71,187

 
$
62,029

Total FFO adjustments
 
24,977

 
21,560

 
52,144

 
46,896

Total Recurring FFO adjustments
 
77

 
—

 
235

 
759

Recurring FFO available to common stockholders
 
61,767

 
54,284

 
123,566

 
109,684

 
 
 
 
 
 
 
 
 
Straight line accrued rent
 
(516
)
 
805

 
(1,118
)
 
27

Net capital lease rent adjustment
 
338

 
410

 
667

 
810

Below market rent amortization
 
(633
)
 
(622
)
 
(1,259
)
 
(1,247
)
Stock based compensation expense
 
2,241

 
1,894

 
4,493

 
3,608

Capitalized interest expense
 
(487
)
 
(321
)
 
(921
)
 
(540
)
Convertible debt interest expense
 
—

 
950

 
—

 
2,072

Total AFFO adjustments
 
943

 
3,116

 
1,862

 
4,730

AFFO available to common stockholders
 
$
62,710

 
$
57,400

 
$
125,428

 
$
114,414

 
 
 
 
 
 
 
 
 
AFFO per common share:
 
 
 
 
 
 
 
 
Basic
 
$
0.51

 
$
0.49

 
$
1.03

 
$
0.99

Diluted
 
$
0.51

 
$
0.47

 
$
1.02

 
$
0.97

 
 
 
 
 
 
 
 
 
Other Information:
 
 
 
 
 
 
 
 
Percentage rent
 
$
223

 
$
162

 
$
312

 
$
534

Amortization of debt costs
 
$
697

 
$
900

 
$
1,353

 
$
1,806

Scheduled debt principal amortization (excluding maturities)
 
$
275

 
$
265

 
$
554

 
$
526

Non-real estate depreciation expense
 
$
67

 
$
61

 
$
132

 
$
123

Real estate acquisition costs (included in general and administrative expense)
 
$
19

 
$
1,604

 
$
227

 
$
1,604


7

National Retail Properties, Inc.
(in thousands)
(unaudited)

Earnings from Discontinued Operations: Effective January 1, 2014, NNN has early adopted ASU 2014-08. Under ASU 2014-08, only disposals representing a strategic shift in operations are to be presented as discontinued operations. This requires the Company 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 revenues and expenses related to these properties are presented as discontinued operations as of June 30, 2014. The Company did not classify any additional properties as discontinued operations subsequent to December 31, 2013.
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Six Months Ended
 
 
June 30,
 
June 30,
 
 
2014
 
2013
 
2014
 
2013
 
 
 
 
 
 
 
 
 
Revenues:
 
 
 
 
 
 
 
 
Rental and earned income
 
$
—

 
$
385

 
$
—

 
$
1,046

Real estate expense reimbursement from tenants
 
6

 
25

 
11

 
77

Interest and other income from real estate transactions
 
22

 
30

 
22

 
34

 
 
28

 
440

 
33

 
1,157

 
 
 
 
 
 
 
 
 
Expenses:
 
 
 
 
 
 
 
 
General and administrative
 
—

 
212

 
—

 
213

Real estate
 
13

 
73

 
—

 
93

Depreciation and amortization
 
—

 
68

 
—

 
157

Impairment charges
 
—

 
904

 
63

 
904

Interest
 
—

 
11

 
—

 
41

 
 
13

 
1,268

 
63

 
1,408

 
 
 
 
 
 
 
 
 
Gain on disposition of real estate
 
3

 
2,669

 
12

 
3,174

Income tax expense
 
—

 
(335
)
 
—

 
(386
)
 
 
 
 
 
 
 
 
 
Earnings (loss) from discontinued operations attributable to NNN including noncontrolling interests
 
18

 
1,506

 
(18
)
 
2,537

Earnings attributable to noncontrolling interests
 
—

 
(158
)
 
—

 
(163
)
Earnings (loss) from discontinued operations attributable to NNN
 
$
18

 
$
1,348

 
$
(18
)
 
$
2,374








8


National Retail Properties, Inc.
(in thousands)
(unaudited)

 
 
June 30, 2014
 
December 31, 2013
Balance Sheet Summary
 
 
 
 
 
 
 
 
 
Assets:
 
 
 
 
Cash and cash equivalents
 
$
85,358

 
$
1,485

Receivables, net of allowance
 
2,017

 
4,107

Mortgages, notes and accrued interest receivable
 
19,680

 
17,119

Real estate portfolio:
 
 
 
 
Accounted for using the operating method, net of accumulated depreciation and amortization
 
4,368,475

 
4,256,595

Accounted for using the direct financing method
 
17,676

 
18,342

Real estate held for sale
 
8,230

 
12,113

Commercial mortgage residual interests
 
12,087

 
11,721

Accrued rental income, net of allowance
 
25,763

 
24,797

Debt costs, net of accumulated amortization
 
14,824

 
12,877

Other assets
 
96,744

 
95,367

Total assets
 
$
4,650,854

 
$
4,454,523

 
 
 
 
 
Liabilities:
 
 
 
 
Line of credit payable
 
$
—

 
$
46,400

Mortgages payable, including unamortized premium
 
8,892

 
9,475

Notes payable, net of unamortized discount
 
1,714,091

 
1,514,184

Accrued interest payable
 
18,532

 
17,142

Other liabilities
 
84,889

 
89,037

Total liabilities
 
1,826,404

 
1,676,238

 
 
 
 
 
Stockholders’ equity of NNN
 
2,823,922

 
2,777,045

Noncontrolling interests
 
528

 
1,240

Total equity
 
2,824,450

 
2,778,285

 
 
 
 
 
Total liabilities and equity
 
$
4,650,854

 
$
4,454,523

 
 
 
 
 
Common shares outstanding
 
124,511

 
121,992

 
 
 
 
 
Gross leasable area, Property Portfolio (square feet)
 
20,751

 
20,402

 
 
 
 
 


9

National Retail Properties, Inc
Debt Summary
As of June 30, 2014
(in thousands)
(unaudited)
Unsecured Debt
 
Principal
 
Principal, Net of Discount
 
Stated Rate
 
Effective Rate
 
Maturity Date
Line of credit payable
 
$
—

 
$
—

 
L + 107.5 bps
 
—
 
October 2016
 
 
 
 
 
 
 
 
 
 
 
Unsecured notes payable:
 
 
 
 
 
 
 
 
 
 
2015
 
150,000

 
149,927

 
6.150%
 
6.185%
 
December 2015
2017
 
250,000

 
249,644

 
6.875%
 
6.924%
 
October 2017
2021
 
300,000

 
296,756

 
5.500%
 
5.690%
 
July 2021
2022
 
325,000

 
320,788

 
3.800%
 
3.984%
 
October 2022
2023
 
350,000

 
347,676

 
3.300%
 
3.388%
 
April 2023
2024
 
350,000

 
349,300

 
3.900%
 
3.924%
 
June 2024
Total
 
1,725,000

 
1,714,091

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total unsecured debt
 
$
1,725,000

 
$
1,714,091

 
 
 
 
 
 



Mortgages Payable
 
Principal Balance
 
Interest Rate
 
Maturity Date
Mortgage(1)
 
$
6,320

 
5.750%
 
April 2016
Mortgage
 
1,923

 
6.900%
 
January 2017
Mortgage(2)
 
649

 
8.630%
 
April 2016 — April 2019
 
 
$
8,892

 
 
 
 
(1) Includes unamortized premium
(2) Represents the total balance of three separate mortgage loans and their weighted average interest rate


10

National Retail Properties, Inc.
Property Portfolio

Top 20 Lines of Trade
 
 
 
 
As of June 30,
 
 
Line of Trade
 
2014(1)
 
2013 (2)
1.
 
Convenience stores
 
19.3%
 
19.9%
2.
 
Restaurants – full service
 
9.6%
 
9.9%
3.
 
Automotive service
 
7.5%
 
7.6%
4.
 
Restaurants – limited service
 
6.8%
 
4.9%
5.
 
Automotive parts
 
5.1%
 
5.2%
6.
 
Theaters
 
4.5%
 
4.4%
7.
 
Health and fitness
 
4.2%
 
3.7%
8.
 
Banks
 
4.1%
 
4.7%
9.
 
Sporting goods
 
3.8%
 
3.7%
10.
 
Recreational vehicle dealers, parts and accessories
 
3.2%
 
2.8%
11.
 
Wholesale clubs
 
3.1%
 
3.1%
12.
 
Drug stores
 
2.7%
 
2.7%
13.
 
Consumer electronics
 
2.6%
 
2.7%
14.
 
Home improvement
 
2.4%
 
2.7%
15.
 
Family entertainment centers
 
2.3%
 
2.2%
16.
 
Travel plazas
 
2.0%
 
2.0%
17.
 
Medical service providers
 
1.8%
 
1.1%
18.
 
Home furnishings
 
1.6%
 
1.6%
19.
 
General merchandise
 
1.6%
 
1.5%
20.
 
Books
 
1.3%
 
1.6%
 
 
Other
 
10.5%
 
12.0%
 
 
Total
 
100.0%
 
100.0%

Top 10 States
 
State
 
 
% of Total(1)
 
 
State
 
 
% of Total(1)
1.
Texas
 
 
20.3%
 
6.
Virgina
 
 
4.5%
2.
Florida
 
 
10.3%
 
7.
Indiana
 
 
4.0%
3.
North Carolina
 
 
5.5%
 
8.
California
 
 
3.4%
4.
Illinois
 
 
5.2%
 
9.
Ohio
 
 
3.3%
5.
Georgia
 
 
4.8%
 
10.
Pennsylvania
 
 
3.2%

(1) 
Based on the annualized base rent for all leases in place as of June 30, 2014.
(2) 
Based on the annualized base rent for all leases in place as of June 30, 2013.


11

National Retail Properties, Inc.
Property Portfolio

Top Tenants (> 2.0%)
 
 
 
Properties
 
% of Total (1)
 
Susser Holdings
 
86
 
4.9%
 
Mister Car Wash
 
87
 
4.9%
 
Pantry
 
84
 
4.3%
 
LA Fitness
 
20
 
4.1%
 
7-Eleven
 
67
 
4.0%
 
SunTrust
 
121
 
3.8%
 
AMC Theatre
 
15
 
3.5%
 
Camping World
 
25
 
3.2%
 
BJ's Wholesale Club
 
7
 
3.1%
 
Best Buy
 
19
 
2.6%
 
Gander Mountain
 
10
 
2.3%
 
Energy Transfer Partners (Sunoco)
 
38
 
2.1%
 
Pull-A-Part
 
20
 
2.0%
 
Road Ranger
 
27
 
2.0%

Lease Expirations(2) 
 
 
% of
Total(1)
 
# of
Properties
 
Gross Leasable
Area (3)
 
 
 
% of
Total(1)
 
# of
Properties
 
Gross Leasable Area (3)
2014
 
0.3%
 
11
 
145,000

 
2020
 
4.0%
 
107
 
1,329,000

2015
 
1.6%
 
31
 
454,000

 
2021
 
4.7%
 
102
 
986,000

2016
 
1.6%
 
30
 
543,000

 
2022
 
6.8%
 
94
 
1,161,000

2017
 
3.4%
 
46
 
1,018,000

 
2023
 
3.2%
 
55
 
946,000

2018
 
7.3%
 
177
 
1,584,000

 
2024
 
2.5%
 
43
 
598,000

2019
 
3.4%
 
63
 
969,000

 
Thereafter
 
61.2%
 
1,129
 
10,432,000


(1) 
Based on the annual base rent of $406,378,000, which is the annualized base rent for all leases in place as of June 30, 2014.
(2) 
As of June 30, 2014, the weighted average remaining lease term is 12 years.
(3) 
Square feet.










12