VEREIT, Inc. - FORM 8-K - EX-99.2 - INFORMATION CONCERNING PROPERTY PORTFOLIO AT DECEMBER 31, 2013 - February 4, 2014

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EX-99.1 - EXHIBIT 99.1 - VEREIT, Inc.v367148_ex99-1.htm

Exhibit 99.2

 

The following provides updated information regarding American Realty Capital Properties, Inc.’s (the “Company”) property portfolio at December 31, 2013:

 

As of December 31, 2013, after giving effect to the merger with American Realty Capital Trust IV, Inc. (“ARCT IV”), which was consummated on January 3, 2014, and the acquisition of the remaining portion of a portfolio of 120 properties acquired by us from affiliates of funds managed by the Fortress Investment Group LLC, 41 of which we acquired on October 1, 2013 and 79 of which we acquired on January 8, 2014 (the “Fortress Portfolio”), we owned 2,639 properties (excluding one vacant property classified as held for sale) consisting of 49.5 million square feet, which properties are approximately 99% leased with a weighted average remaining lease term of 9.3 years.

 

As of December 31, 2013, Cole Real Estate Investments, Inc. (“Cole”) owned 1,043 properties, comprising 45.7 million square feet of single and multi-tenant retail and commercial space, which are leased to national and regional credit worthy tenants under long-term triple net leases and double net leases, located in 48 states, which include properties owned through consolidated joint ventures. As of December 31, 2013, the rentable space at these properties was approximately 99% leased. As of December 31, 2013, Cole also owned 21 commercial mortgage-backed securities, which we refer to as CMBS, two notes receivable and, through unconsolidated joint ventures, had interests in 12 properties comprising 2.3 million rentable square feet of commercial and retail space.

 

The portfolio of properties owned by certain special purpose entities of Inland American Real Estate Trust, Inc. (“Inland”) includes 33 properties (the “Inland Portfolio”), five of which we purchased on September 24, 2013 for cash consideration and expenses equal to $50.0 million, which we paid using cash on hand. As of December 31, 2013, the remaining properties to be acquired in the Inland Portfolio are leased to 24 distinct tenants under leases that are generally triple net and the remaining weighted average term of the Inland Portfolio leases is 4.5 years. The annualized rental income on a10.5 cash basis for the Inland Portfolio was $46.4 million for the year ended December 31, 2013.

 

Subsequent to December 31, 2013, we acquired ARCT IV and completed the acquisition of the remaining properties of the Fortress Portfolio. In addition, we are party to agreements to acquire Cole, which we expect to close promptly following the consummation of this offering, and the remaining Inland Portfolio, which we expect to close in the first half of 2014. The combined company, on a pro forma basis as of December 31, 2013 (including the acquisitions of Cole, ARCT IV and the Fortress Portfolio, and assuming the close of the proposed merger with Cole and the acquisition of the balance of the Inland Portfolio), would own 3,710 properties, net leased to approximately 1,100 primarily investment grade rated and other credit tenants, consisting of 101.5 million square feet, which are approximately 99% leased, in 49 states, the District of Columbia and Puerto Rico. The portfolio will operate in 67 distinct industries and will have an average remaining lease duration of 10.5 years, with approximately 49% of rental revenues derived from investment grade tenants and tenants affiliated with investment grade entities as determined by a major credit agency. No tenant comprises more than 3.5% of our total annualized rental income on a straight-line basis on a pro forma basis as of December 31, 2013.

 

 
 

 

PROPERTY AND PORTFOLIO INFORMATION

The following is an overview of our property portfolio on a pro forma basis as of December 31, 2013:

Top 10 Concentrations

Tenant Concentration

             
Tenant   Number of Leases   Square
Feet		   Square Feet
as a % of
Total
Portfolio		   Average Remaining Lease
Term		   Average
Annual
Rent
(in 000’s)		   Average
Annual Rent
as a % of
Total Portfolio(1)		   Investment Rating
Walgreens     116       1,695,145       1.67 %      16.25     $ 43,100       3.50 %      BBB  
AT&T     14       2,689,928       2.65 %      6.54       39,288       3.19 %      A-  
CVS     106       1,496,060       1.47 %      18.48       36,215       2.95 %      BBB+  
Dollar General     367       3,376,639       3.33 %      12.79       30,557       2.49 %      BBB-  
FedEx     48       2,449,894       2.41 %      10.01       26,320       2.14 %      BBB  
PetSmart     42       1,331,157       1.31 %      7.74       24,264       1.97 %      BB+  
Albertson’s     34       1,969,000       1.95 %      16.29       24,074       1.96 %      B  
Citizens Bank     191       975,855       0.96 %      6.97       23,547       1.92 %      A-  
BJ’s Wholesale Club     15       2,463,516       2.43 %      16.31       21,653       1.76 %      B-  
Family Dollar     227       1,936,464       1.91 %      11.47       20,964       1.70 %      BBB-  
Total     1,160       20,383,658       20.09 %     12.48     $ 289,982       23.58 %      

Tenant Industry Concentration

         
Tenant   Number of Leases   Square
Feet		   Square Feet as a % of Total Portfolio   Average Annual
Rent
(in 000’s)		   Average Annual Rent as a % of
Total
Portfolio(1)
Quick Service Restaurant     1,036       2,870,296       2.83 %    $ 91,950       7.48 % 
Pharmacy     248       3,513,095       3.46 %      86,058       7.00 % 
Casual Dining     457       2,770,551       2.73 %      75,766       6.16 % 
Supermarket     88       5,788,157       5.70 %      65,389       5.31 % 
Discount Retail     595       5,321,103       5.24 %      51,660       4.20 % 
Consumer Products     32       12,100,137       11.93 %      50,284       4.09 % 
Healthcare     120       2,607,559       2.57 %      50,281       4.09 % 
Family Dining     364       2,070,533       2.04 %      50,149       4.08 % 
Specialty Retail     207       3,811,345       3.76 %      47,911       3.90 % 
Retail Banking     298       2,034,841       2.01 %      45,638       3.71 % 
Total     3,445       42,887,617       42.27 %   $ 615,086       50.02 %

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Geographic Concentration

         
State/Possession   Number of Properties   Square Feet   Square Feet as a % of
Total Portfolio		   Average Annual
Rent
(in 000’s)		   Average Annual Rent as a % of
Total
Portfolio(1)
Texas     501       10,919,617       10.76 %    $ 151,343       12.31 % 
Illinois     161       5,968,344       5.88 %      77,162       6.27 % 
California     78       6,098,940       6.01 %      74,509       6.06 % 
Florida     234       5,511,166       5.43 %      72,392       5.89 % 
Georgia     181       5,669,822       5.59 %      70,443       5.73 % 
Arizona     73       3,214,727       3.17 %      54,609       4.44 % 
Pennsylvania     140       5,446,815       5.37 %      49,201       4.00 % 
Ohio     225       5,611,566       5.53 %      45,749       3.72 % 
Michigan     166       3,223,511       3.18 %      42,963       3.49 % 
Indiana     115       5,620,538       5.54 %      39,042       3.17 % 
Total     1,874       57,285,046       56.46 %   $ 677,413       55.08 %

Property Building Type Diversification

         
Building Type   Number of Properties   Square Feet   Square Feet as a % of Total Portfolio   Average
Annual
Rent
(in 000’s)		   Average Annual Rent as a % of
Total
Portfolio(1)
Retail     3,358       34,546,007       34.05 %    $ 592,227       48.16 % 
Office     146       16,843,455       16.60 %      291,247       23.68 % 
Distribution     90       28,152,569       27.75 %      139,381       11.34 % 
Parking Lot     1       8,400       0.01 %      1       0.00 % 
Billboard     5       0       0.00 %      46       0.00 % 
Vacant     5       359,074       0.35 %      —       0.00 % 
Industrial     22       9,449,165       9.31 %      44,281       3.60 % 
Multi-Tenant Retail     83       12,104,288       11.93 %      162,580       13.22 % 
Total     3,710       101,462,958       100.00 %   $ 1,229,763       100.00 %

Lease Expirations by Year

         
Year of Expiration   Number of Leases Expiring   Average Annual Rent (in 000’s)   % of Portfolio Average Annual Rent Expiring(1)   Leased Rentable Square Feet   % of Portfolio Rentable Square Feet Expiring
2014     177     $ 19,442       1.58 %      1,660,887       1.64 % 
2015     238       33,893       2.76 %      3,209,252       3.16 % 
2016     268       49,883       4.06 %      4,437,963       4.37 % 
2017     374       86,670       7.05 %      7,300,831       7.20 % 
2018     386       60,760       4.94 %      4,291,647       4.23 % 
2019     246       58,112       4.73 %      3,738,363       3.68 % 
2020     189       43,476       3.54 %      2,829,754       2.79 % 
2021     202       87,775       7.14 %      11,614,463       11.45 % 
2022     285       83,137       6.75 %      10,455,037       10.30 % 
2023     238       88,801       7.22 %      7,116,588       7.02 % 
2024     169       110,585       8.98 %      8,811,699       8.68 % 
2025     269       53,082       4.32 %      3,548,571       3.50 % 
2026     268       72,581       5.90 %      6,462,952       6.37 % 
2027     538       89,756       7.30 %      5,424,870       5.35 % 
2028     224       61,605       5.01 %      3,890,138       3.83 % 
Total     4,071     $ 999,558       81.28 %     84,793,015       83.57 %

(1) Annualized rental income as of December 31, 2013 for each portfolio and combined on a straight-line basis. 50 ARCP properties have leases that are accounted for as direct financing leases. Amounts reflected is the average cash rent per the term of the leases. Annual rental income is based on the acquisition date of the respective company and amounts will be recalculated upon the merger date based on the remaining lease terms as of that date.

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