CONSOLIDATING FINANCIAL STATEMENTS (Tables)

3 Months Ended

Mar. 31, 2017

Condensed Financial Information Of Parent Company Only Disclosure [Abstract]

Schedule of consolidating balance sheets

CONSOLIDATING BALANCE SHEET

Unaudited

(in thousands)

	March 31, 2017
	Issuer &  Subsidiary  Guarantors			Non –  Guarantor  Subsidiaries			Elimination			Consolidated
ASSETS
Real estate properties
Real estate investments	$	6,934,468		$	647,197		$	—		$	7,581,665
Less accumulated depreciation		(1,250,968	)		(55,116	)		—			(1,306,084	)
Real estate investments – net		5,683,500			592,081			—			6,275,581
Investment in direct financing leases - net		604,777			—			—			604,777
Mortgage notes receivable - net		644,696			—			—			644,696
		6,932,973			592,081			—			7,525,054
Other investments - net		255,899			—			—			255,899
Investment in unconsolidated joint venture		40,152			—			—			40,152
Assets held for sale – net		23,245			—			—			23,245
Total investments		7,252,269			592,081			—			7,844,350
Cash and cash equivalents		31,851			8,498			—			40,349
Restricted cash		6,916			5,282			—			12,198
Accounts receivable – net		261,204			11,302			—			272,506
Goodwill		630,679			13,013			—			643,692
Investments in and advances to affiliates		569,978			—			(569,978	)		—
Other assets		17,357			11,666			—			29,023
Total assets	$	8,770,254		$	641,842		$	(569,978	)	$	8,842,118
LIABILITIES AND EQUITY
Revolving line of credit	$	123,000		$	—		$	—		$	123,000
Term loans - net		1,094,875			—			—			1,094,875
Secured borrowings - net		—			432,217			(378,165	)		54,052
Unsecured borrowings – net		3,028,938			—			—			3,028,938
Accrued expenses and other liabilities		308,919			8,066			—			316,985
Deferred income taxes		—			9,746			—			9,746
Intercompany payable		—			4,986			(4,986	)		—
Total liabilities		4,555,732			455,015			(383,151	)		4,627,596
Equity:
Common stock		19,676			—			—			19,676
Equity investment from affiliates		—			152,700			(152,700	)		—
Common stock – additional paid-in capital		4,878,637			—			—			4,878,637
Cumulative net earnings		1,843,377			33,594			(33,594	)		1,843,377
Cumulative dividends paid		(2,829,718	)		—			—			(2,829,718	)
Accumulated other comprehensive (loss) income		(48,478	)		533			(533	)		(48,478	)
Total stockholders’ equity		3,863,494			186,827			(186,827	)		3,863,494
Noncontrolling interest		351,028			—			—			351,028
Total equity		4,214,522			186,827			(186,827	)		4,214,522
Total liabilities and equity	$	8,770,254		$	641,842		$	(569,978	)	$	8,842,118

CONSOLIDATING BALANCE SHEET

(in thousands)

	December 31, 2016
	Issuer &  Subsidiary  Guarantors			Non –  Guarantor  Subsidiaries			Elimination			Consolidated
ASSETS
Real estate properties
Real estate investments	$	6,923,469		$	642,889		$	—		$	7,566,358
Less accumulated depreciation		(1,191,117	)		(49,219	)		—			(1,240,336	)
Real estate investments – net		5,732,352			593,670			—			6,326,022
Investment in direct financing leases - net		601,938			—			—			601,938
Mortgage notes receivable - net		639,343			—			—			639,343
		6,973,633			593,670			—			7,567,303
Other investments - net		256,846			—			—			256,846
Investment in unconsolidated joint venture		48,776			—			—			48,776
Assets held for sale – net		52,868			—			—			52,868
Total investments		7,332,123			593,670			—			7,925,793
Cash and cash equivalents		87,098			6,589			—			93,687
Restricted cash		6,915			6,674			—			13,589
Accounts receivable – net		230,097			9,938			—			240,035
Goodwill		630,679			12,795			—			643,474
Investments in and advances to affiliates		569,194			—			(569,194	)		—
Other assets		21,293			11,389			—			32,682
Total assets	$	8,877,399		$	641,055		$	(569,194	)	$	8,949,260
LIABILITIES AND EQUITY
Revolving line of credit	$	190,000		$	—		$	—		$	190,000
Term loans - net		1,094,343			—			—			1,094,343
Secured borrowings - net		—			429,214			(374,849	)		54,365
Unsecured borrowings – net		3,028,146			—			—			3,028,146
Accrued expenses and other liabilities		352,924			7,590			—			360,514
Deferred income taxes		—			9,906			—			9,906
Intercompany payable		—			7,890			(7,890	)		—
Total liabilities		4,665,413			454,600			(382,739	)		4,737,274
Equity:
Common stock		19,614			—			—			19,614
Equity investment from affiliates		—			156,446			(156,446	)		—
Common stock – additional paid-in capital		4,861,408			—			—			4,861,408
Cumulative net earnings		1,738,937			29,479			(29,479	)		1,738,937
Cumulative dividends paid		(2,707,387	)		—			—			(2,707,387	)
Accumulated other comprehensive (loss) income		(53,827	)		530			(530	)		(53,827	)
Total stockholders’ equity		3,858,745			186,455			(186,455	)		3,858,745
Noncontrolling interest		353,241			—			—			353,241
Total equity		4,211,986			186,455			(186,455	)		4,211,986
Total liabilities and equity	$	8,877,399		$	641,055		$	(569,194	)	$	8,949,260

Schedule of consolidating statement of operations

CONSOLIDATING STATEMENT OF OPERATIONS

Unaudited

(in thousands)

	Three Months Ended March 31, 2017
	Issuer &  Subsidiary  Guarantors			Non –  Guarantor Subsidiaries			Elimination			Consolidated
Revenue
Rental income	$	177,645		$	14,892		$	-		$	192,537
Income from direct financing leases		15,646			-			-			15,646
Mortgage interest income		15,956			-			-			15,956
Other investment income – net		8,759			-			(1,845	)		6,914
Miscellaneous income		691			-			-			691
Total operating revenues		218,697			14,892			(1,845	)		231,744
Expenses
Depreciation and amortization		64,275			5,718			-			69,993
General and administrative		12,453			71			-			12,524
Acquisition costs		(41	)		-			-			(41	)
Impairment loss on real estate properties		7,638			-			-			7,638
Provision for uncollectible accounts		2,404			-			-			2,404
Total operating expenses		86,729			5,789			-			92,518
Income before other income and expense		131,968			9,103			(1,845	)		139,226
Other income (expense):
Interest income		-			4			-			4
Interest expense		(42,013	)		(4,873	)		1,845			(45,041	)
Interest – amortization of deferred financing costs		(2,497	)		(5	)		-			(2,502	)
Contractual settlement		10,412			-			-			10,412
Realized gain on foreign exchange		61			-			-			61
Equity in earnings		4,115			-			(4,115	)		-
Total other expense		(29,922	)		(4,874	)		(2,270	)		(37,066	)
Income before gain on assets sold		102,046			4,229			(4,115	)		102,160
Gain on assets sold - net		7,420			-			-			7,420
Income from continuing operations		109,466			4,229			(4,115	)		109,580
Income tax expense		(986	)		(114	)		-			(1,100	)
Income from unconsolidated joint venture		632			-			-			632
Net income		109,112			4,115			(4,115	)		109,112
Net income attributable to noncontrolling interest		(4,672	)		-			-			(4,672	)
Net income available to common stockholders	$	104,440		$	4,115		$	(4,115	)	$	104,440

CONSOLIDATING STATEMENTS OF OPERATIONS

Unaudited

(in thousands)

	Three Months Ended March 31, 2016
	Issuer &  Subsidiary  Guarantors			Non – Guarantor  Subsidiaries			Elimination		Consolidated
Revenue
Rental income	$	163,393		$	13,310		$	-	$	176,703
Income from direct financing leases		15,442			-			-		15,442
Mortgage interest income		16,606			-			-		16,606
Other investment income – net		3,431			-			-		3,431
Miscellaneous income		697			-			-		697
Total operating revenues		199,569			13,310			-		212,879
Expenses
Depreciation and amortization		57,279			5,154			-		62,433
General and administrative		10,343			112			-		10,455
Acquisition costs		2,429			1,342			-		3,771
Impairment loss on real estate properties		34,340			218			-		34,558
Provisions for uncollectible accounts		1,862			3,262			-		5,124
Total operating expenses		106,253			10,088			-		116,341
Income before other income and expense		93,316			3,222			-		96,538
Other income (expense):
Interest income		5			3			-		8
Interest expense		(33,389	)		(3,833	)		-		(37,222	)
Interest – amortization of deferred financing costs		(2,126	)		(6	)		-		(2,132	)
Interest – refinancing costs		(298	)		-			-		(298	)
Realized loss on foreign exchange		(22	)		-			-		(22	)
Equity in earnings		(682	)		-			682		-
Total other expense		(36,512	)		(3,836	)		682		(39,666	)
Income before gain (loss) on assets sold		56,804			(614	)		682		56,872
Gain on assets sold - net		1,571			-			-		1,571
Income from continuing operations		58,375			(614	)		682		58,443
Income tax expense		(141	)		(106	)		-		(247	)
Net income		58,234			(720	)		682		58,196
Net income attributable to noncontrolling interest		(2,679	)		38			-		(2,641	)
Net income available to common stockholders	$	55,555		$	(682	)	$	682	$	55,555

Schedule of consolidating statement of comprehensive income

CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

(in thousands)

	Three Months Ended March 31, 2017
	Issuer &  Subsidiary  Guarantors			Non –  Guarantor  Subsidiaries		Elimination			Consolidated
Net income	$	109,112		$	4,115	$	(4,115	)	$	109,112
Other comprehensive income (loss)
Foreign currency translation		4,334			-		-			4,334
Cash flow hedges		1,254			-		-			1,254
Total other comprehensive income (loss)		5,588			-		-			5,588
Comprehensive income		114,700			4,115		(4,115	)		114,700
Comprehensive income attributable to noncontrolling interest		(4,911	)		-		-			(4,911	)
Comprehensive income attributable to common stockholders	$	109,789		$	4,115	$	(4,115	)	$	109,789

CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

(in thousands)

	Three Months Ended March 31, 2016
	Issuer &  Subsidiary  Guarantors			Non –  Guarantor  Subsidiaries			Elimination		Consolidated
Net income	$	58,234		$	(720	)	$	682	$	58,196
Other comprehensive income (loss)
Foreign currency translation		(4,730	)		-			-		(4,730	)
Cash flow hedges		(8,876	)		-			-		(8,876	)
Total other comprehensive income (loss)		(13,606	)		-			-		(13,606	)
Comprehensive income		44,628			(720	)		682		44,590
Comprehensive income attributable to noncontrolling interest		(2,063	)		38			-		(2,025	)
Comprehensive income attributable to common stockholders	$	42,565		$	(682	)	$	682	$	42,565

Schedule of consolidating statement of cash flows

CONSOLIDATING STATEMENTS OF CASH FLOWS

Unaudited

(in thousands)

	Three Months Ended March 31, 2017
	Issuer &  Subsidiary  Guarantors			Non-Guarantor  Subsidiaries			Elimination			Consolidated
Cash flows from operating activities
Net income	$	109,112		$	4,115		$	(4,115	)	$	109,112
Adjustment to reconcile net income to cash provided by operating activities:
Depreciation and amortization		64,275			5,718			—			69,993
Provision for impairment on real estate properties		7,638			—			—			7,638
Provision for uncollectible accounts		2,404			—			—			2,404
Amortization of deferred financing and refinancing costs		2,497			5			—			2,502
Accretion of direct financing leases		(3,016	)		—			—			(3,016	)
Stock-based compensation expense		3,744			—			—			3,744
Gain on assets sold – net		(7,420	)		—			—			(7,420	)
Amortization of acquired in-place leases - net		(3,096	)		—			—			(3,096	)
Effective yield receivable on mortgage notes		(593	)		—			—			(593	)
Equity in earnings		(4,115	)		—			4,115			—
Change in operating assets and liabilities – net:
Accounts receivable		(21,377	)		—			—			(21,377	)
Straight-line rent receivables		(10,444	)		(1,303	)		—			(11,747	)
Lease inducements		447			—			—			447
Other operating assets and liabilities		(32,990	)		(1,663	)		—			(34,653	)
Net cash provided by operating activities		107,066			6,872			—			113,938
Cash flows from investing activities
Acquisition of real estate		(7,574	)		—			—			(7,574	)
Investment in construction in progress		(15,703	)		—			—			(15,703	)
Investments in U.K. subsidiaries		4,807			—			(4,807	)		—
Investment in direct financing leases		(2,229	)		—			—			(2,229	)
Placement of mortgage loans		(5,749	)		—			—			(5,749	)
Distributions from unconsolidated joint venture		8,587			—			—			8,587
Proceeds from sale of real estate investments		45,848			—			—			45,848
Capital improvements to real estate investments		(8,199	)		—			—			(8,199	)
Proceeds from other investments		23,181			—			—			23,181
Investments in other investments		(22,144	)		—			—			(22,144	)
Collection of mortgage principal		333			—			—			333
Net cash provided by investing activities		21,158			—			(4,807	)		16,351
Cash flows from financing activities
Proceeds from credit facility borrowings		148,000			—			—			148,000
Payments on credit facility borrowings		(215,000	)		—			—			(215,000	)
Payments of other long-term borrowings		—			(318	)		—			(318	)
Payments of financing related costs		(563	)		—			—			(563	)
Receipts from dividend reinvestment plan		7,335			—			—			7,335
Payments for exercised options and restricted stock		(2,120	)		—			—			(2,120	)
Net proceeds from issuance of common stock		6,759			—			—			6,759
Dividends paid		(122,272	)		—			—			(122,272	)
Contributions from affiliates		—			(4,807	)		4,807			—
Redemption of OP Units		(56	)		—			—			(56	)
Distributions to OP Unit Holders		(5,554	)		—			—			(5,554	)
Net cash used in financing activities		(183,471	)		(5,125	)		4,807			(183,789	)
Effect of foreign currency translation on cash and cash equivalents		—			162			—			162
(Decrease) increase in cash and cash equivalents		(55,247	)		1,909			—			(53,338	)
Cash and cash equivalents at beginning of period		87,098			6,589			—			93,687
Cash and cash equivalents at end of period	$	31,851		$	8,498		$	—		$	40,349

CONSOLIDATING STATEMENTS OF CASH FLOWS

Unaudited

(in thousands)

	Three Months Ended March 31, 2016
	Issuer &  Subsidiary  Guarantors			Non-Guarantor  Subsidiaries			Elimination			Consolidated
Cash flows from operating activities
Net income	$	58,234		$	(720	)	$	682		$	58,196
Adjustment to reconcile net income to cash provided by operating activities:
Depreciation and amortization		57,279			5,154			—			62,433
Provision for impairment on real estate properties		34,340			218			—			34,558
Provision for uncollectible accounts		1,862			3,262			—			5,124
Amortization of deferred financing and refinancing costs		2,424			6			—			2,430
Accretion of direct financing leases		(2,921	)		—			—			(2,921	)
Stock-based compensation		2,778			—			—			2,778
Gain on assets sold – net		(1,571	)		—			—			(1,571	)
Amortization of acquired in-place leases - net		(4,300	)		—			—			(4,300	)
Effective yield receivable on mortgage notes		(819	)		—			—			(819	)
Change in operating assets and liabilities – net:
Accounts receivable		581			(21	)		—			560
Straight-line rent receivables		(9,111	)		(836	)		—			(9,947	)
Lease inducements		647			—			—			647
Other operating assets and liabilities		(10,793	)		(8,514	)		(682	)		(19,989	)
Net cash provided by (used in) operating activities		128,630			(1,451	)		—			127,179
Cash flows from investing activities
Acquisition of real estate		(401,700	)		(14,404	)		—			(416,104	)
Investment in construction in progress		(16,316	)		—			—			(16,316	)
Deposit to acquire real estate		—			(113,816	)		—			(113,816	)
Investment in U.K. subsidiary		(127,239	)		127,239			—			—
Placement of mortgage loans		(6,162	)		—			—			(6,162	)
Proceeds from sale of real estate investments		2,392			—			—			2,392
Capital improvements to real estate investments		(9,004	)		(540	)		—			(9,544	)
Proceeds from other investments		1,461			—			—			1,461
Investments in other investments		(116,003	)		—			—			(116,003	)
Collection of mortgage principal		312			—			—			312
Net cash used in investing activities		(672,259	)		(1,521	)		—			(673,780	)
Cash flows from financing activities
Proceeds from credit facility borrowings		670,000			—			—			670,000
Payments on credit facility borrowings		(370,000	)		—			—			(370,000	)
Receipts of other long-term borrowings		350,000			—			—			350,000
Payments of other long-term borrowings		—			(309	)		—			(309	)
Payments of financing related costs		(3,552	)		(24	)		—			(3,576	)
Receipts from dividend reinvestment plan		19,596			—			—			19,596
Payments for exercised options and restricted stock – net		(2,381	)		—			—			(2,381	)
Dividends paid		(107,500	)		—			—			(107,500	)
Redemption of OP Units		(10	)		—			—			(10	)
Distributions to OP Unit Holders		(5,131	)		—			—			(5,131	)
Net cash provided by (used in) financing activities		551,022			(333	)		—			550,689
Effect of foreign currency translation on cash and cash equivalents		—			(105	)		—			(105	)
Increase (decrease) in cash and cash equivalents		7,393			(3,410	)		—			3,983
Cash and cash equivalents at beginning of period		1,592			3,832			—			5,424
Cash and cash equivalents at end of period	$	8,985		$	422		$	—		$	9,407