Oct 22, 2026 earnings call — Updated AFFO guidance and capital deployment
Management raised 2026 AFFO per share guidance to a range of $2.20 to $2.50 and increased investment volume guidance to $1.3 billion to $1.5 billion.
Revenue $0.2B (est $0.2B) · EPS $0.27 (est $0.33)
Key quotes
"As Max will discuss later, we are achieving pricing power in real time with new investments being struck at higher cap rates than the third quarter investments, which were largely contracted over the summer."
"Same store rent growth was 1.4%, consistent with recent quarters."
Analyst Q&A 13
2027 guidance and debt plan
Q (Michael Goldsmith · UBS): He asked how the company will meet 2027 guidance and what they assume for refinancing the debt on the revolver and other options.
A: Management said the guidance includes investment volume and that they are evaluating all debt alternatives. They plan to term out the swap that becomes floating at the end of November and baked scenarios into the guidance range.
"That swap will mature at the end of November, at which time it will become a floating rate obligation just like the rest of our revolving credit facility." — Robert W. Salisbury (CFO)
capital plan and dispositions
Q (Mizuho): He wanted color on capital deployment, whether leverage will rise in 2027, and key swing factors for the guidance range.
A: Management said volumes should decrease but competition will fall more, leaving opportunities to invest selectively. They are not assuming a dramatic re-leveraging and expect no near-term common equity issuance.
"we are not assuming a dramatic re leveraging of the sheet." — Robert W. Salisbury (CFO)
gross or net investment guide and sectors
Q (Jana Galan · BofA): She asked whether the 2027 investment guide is gross or net, and if any tenant categories look more attractive.
A: Management said they guide to a gross investment number. They also said their investment strategy has not changed and they price deals industry-by-industry based on risk-adjusted returns.
"Our investment strategy has not changed in the last decade." — Robert Max Jenkins (COO)
how they keep attractive spreads
Q (Goldman Sachs): She asked why they can still get attractive spreads today: more deal flow, bargaining power, or something else; and whether industry mix might shift.
A: Management said they look at many deals and invest in small, granular chunks which gives optionality. They focus on middle-market operators who value capital for growth, and they expect the investment mix to remain ratable to the portfolio.
"I think part of this is looking at a lot of deals, having a lot of throughput, We have a very granular portfolio, where we are investing in 5 to 10 million dollars chunks." — Peter Mavoides (CEO)
which sellers adjust expectations faster
Q (Bennett Rose · Citi): He asked whether some segments will adjust seller expectations faster than others and if deals are being canceled or repriced now.
A: Management said auction market net-lease sellers will adjust slower, while middle-market sale-leaseback operators adjusted quickly. They reviewed 60–90 pipeline deals, saw a mixed outcome, and noted their expected close rate fell from 90–95% to about 65–70% in the current market.
"I think where we focus providing capital to middle market operators and sale leasebacks that is very dynamic and those operators are less price sensitive." — Peter Mavoides (CEO)
credit losses and impairment cause
Q (Eric Borden · BMO): He asked about the credit loss assumption in 2027 versus realized losses this year, and what drove the quarter's impairment.
A: Management said realized credit losses are trending better than guided and their guidance assumes losses well in excess of the roughly 30 basis point historical realized loss. The impairment was idiosyncratic, driven by 1 former ArtVan home-furnishings site that has been vacant and is now impaired after new leasing information.
"credit losses generally are trending slightly better than we had guided to, for this year." — Robert W. Salisbury (CFO)
funding runway for 2027
Q (Richard Hightower · Barclays): He asked whether funding sources cover 2027 activity and how the back-end loading affects runway and leverage.
A: Management said they are fully covered for next year from a funding and leverage capacity standpoint and would end the year in the low to mid fours net debt to annualized adjusted EBITDAre pro forma assuming no equity. They noted dispositions and improved cost of capital would drive the high end of the investment range.
"Yes. We are fully covered in terms of funding for next year, and that is maybe from a liquidity standpoint." — Robert W. Salisbury (CFO)
why credit losses are lower
Q (Truist): She asked whether lower credit loss comes from how they run the portfolio or from healthier tenants, and if spreads should improve in 2027.
A: Management said lower losses are mostly from selecting investments up front; they have long average lease terms so little can change after investment. They said historical spread outcomes are an output of market moves and that they expect net investment spreads in 2027 to be about the same, but it is early to be definitive.
"the vast majority of our low level of credit losses can be attributed to the investment decisions we make at the outset." — Peter Mavoides (CEO)
escalators with higher cap rates
Q (Evercore): He asked if they can still get their 1.9% average escalators with initial cap rates around 8%.
A: Management said escalations have increased and they are sitting at 1.9% currently, and the forward pipeline is consistent with that. They expect GAAP yields to approach the mid to high nines and remain comfortable with pricing to achieve accretive spreads.
"I would say you have seen over the last year or 2 that we have been able to push the escalations, and they have kind of increased, and we are sitting at 1.9%." — Robert Max Jenkins (COO)
why deals fail and target spread
Q (Greg McGinniss · Scotiabank): He asked whether deals are failing because the company changed underwriting or because sellers are stepping away, and if there is a target spread to re-accelerate investing.
A: Management said they have not changed underwriting, though they have adjusted pricing; deals fail both due to choppy capital markets and because offered pricing no longer works for counterparties. On cost of capital they said incremental cost today is mid to high 6s, and typical achievable spread is in the 100 to 150 basis point range presently.
"it is it is not our team adjusting underwriting. It could be our team adjusting pricing." — Peter Mavoides (CEO)
bonus depreciation demand and tenant moves
Q (Wells Fargo): He asked how deep and sticky the bonus depreciation investor pool is and about recent tenant changes and appetite for Dave & Buster's.
A: Management said there is strong demand for tax-motivated capital and it is sticky, with penalties for selling once fully depreciated; demand is typically stronger in Q4. On tenants, they noted small quarter-to-quarter shifts are normal, the Dave & Buster's deal was accretive but they do not expect to add much more exposure to that name.
"It tends, you know, as you would imagine, given any sort of tax-motivated capital tends to be more robust in the fourth quarter than the first and the second quarter." — Peter Mavoides (CEO)
lease renewals and rent mark-to-market
Q (Green Street): He asked if upcoming renewals are an opportunity to raise rents or if they will keep coverage near the portfolio average.
A: Management said most leases include tenant renewal options (typically 10-year or 4–5 year options) and exercise is at the tenant's discretion, so they cannot mark these to market. They assume high-coverage tenants are very likely to exercise options and stay.
"Typically, it is either 10-year renewal options or 4, 5 year renewal options." — Peter Mavoides (CEO)
pipeline cap rate move and disposition timing
Q (John Massocca · B. Riley): He asked how quickly higher cap rates in the pipeline should show up in closed deals, and how fast dispositions could accelerate toward the 2027 plan.
A: Management said the pipeline is a roughly 90-day forward look, and cap-rate moves shown in the pipeline reflect that short forward window. On dispositions, they said sales have a typical 30-day premarket, 30-day market and 30-day close cadence, so ramping dispositions up could take a couple quarters rather than immediate large change.
"As we have always said, you know, our pipeline is about a 90-day forward look." — Robert Max Jenkins (COO)