Four Corners Property Trust Inc (FCPT) 2022 Q4 法說會逐字稿

Ladies and gentlemen, welcome to the FCPT Fourth Quarter 2022 Financial Results Conference Call. My name is Glen, and I'll be the moderator for today's call. (Operator Instructions).

女士們，先生們，歡迎來到 FCPT 2022 年第四季度財務業績電話會議。我叫格倫，我將擔任今天電話會議的主持人。 （操作員說明）。

I will now hand you over to your host, Gerry, to begin. Gerry, please go ahead.

我現在將把你們交給你們的主持人格里，讓你們開始。格里，請繼續。

Thank you, Glen. During the course of this call, we will make forward-looking statements, which are based on beliefs and assumptions made by us. Our actual results will be affected by known and unknown factors that are beyond our control or ability to predict.

謝謝你，格倫。在本次電話會議期間，我們將根據我們的信念和假設做出前瞻性陳述。我們的實際結果將受到我們無法控製或無法預測的已知和未知因素的影響。

Our assumptions are not a guarantee of future performance and some will prove to be incorrect. For a more detailed description of potential risks, please refer to our SEC filings, which can be found at fcpt.com. All the information presented on this call is current as of today, February 16, 2023.

我們的假設並不能保證未來的表現，有些假設會被證明是不正確的。有關潛在風險的更詳細描述，請參閱我們的美國證券交易委員會文件，該文件可在 fcpt.com 上找到。本次電話會議中提供的所有信息都是截至今天（2023 年 2 月 16 日）的最新信息。

In addition, reconciliation to non-GAAP financial measures presented on this call such as FFO and AFFO can be found in the company's supplemental report, also on the website. And with that, I'll turn the call over to Bill.

此外，與本次電話會議上提出的非 GAAP 財務指標（例如 FFO 和 AFFO）的對賬可以在公司的補充報告中找到，也可以在網站上找到。有了這個，我會把電話轉給比爾。

Thank you, Gerry. Good morning. Thank you for joining us to discuss our fourth quarter results. I'm going to make introductory remarks. Patrick will review some details around acquisitions in the pipeline, and then Gerry will discuss the financial and capital raising results.

謝謝你，格里。早上好。感謝您加入我們討論我們的第四季度業績。我要作開場白。 Patrick 將審查有關正在進行的收購的一些細節，然後 Gerry 將討論財務和融資結果。

The existing portfolio continued to perform exceptionally well with 99.9% collections for the year ended December 31 and occupancy remaining at 99.9%. We reported fourth quarter AFFO of $0.41 per share and $1.64 per share for the full year, which represents 5% growth for 2022 over 2021. We grew cash rental revenues 11.4% on a year-over-year basis, including the benefit of rental increases and $286 million of acquisitions in 2022. This included the acquisition of 42 properties in the fourth quarter for $120 million at an initial cash yield of 6.6%, reflecting rents in place as of December 31.

現有投資組合繼續表現出色，截至 12 月 31 日止年度收款率為 99.9%，入住率保持在 99.9%。我們報告第四季度 AFFO 每股收益為 0.41 美元，全年每股收益為 1.64 美元，2022 年比 2021 年增長 5%。我們的現金租金收入同比增長 11.4%，其中包括租金上漲帶來的好處以及 2022 年 2.86 億美元的收購。這包括第四季度以 1.2 億美元收購 42 處房產，初始現金收益率為 6.6%，反映了截至 12 月 31 日的租金。

33 of the 42 acquired properties are corporate operated, and we remain highly confident we are aligning our portfolio with best-in-class operators at attractive rent levels. Patrick will discuss the current investment environment in more detail. But in the fourth quarter, we continue to see acquisition pricing improve in response to the higher cost of capital environment. The Q4 acquisitions average cap rate reflected that dynamic at 6.6% versus 6.3% in Q3. The blended Q4 figure included deals priced earlier in the year prior to the shifting cap rates with more recently priced deals above the average for the quarter.

收購的 42 處物業中有 33 處是公司經營的，我們仍然非常有信心將我們的投資組合與具有吸引力的租金水平的一流運營商保持一致。 Patrick 將更詳細地討論當前的投資環境。但在第四季度，我們繼續看到收購定價有所改善，以應對較高的資本環境成本。第 4 季度的收購平均上限率為 6.6%，而第 3 季度為 6.3%。第 4 季度的混合數據包括在上限利率發生變化之前一年早些時候定價的交易，以及最近定價高於本季度平均水平的交易。

We note that sale leaseback transactions have more appeal now to operators versus other forms of financing in recent years. Equity capital, term loans, CMBS, all have become more expensive in the last 6 months, and this has led us to more opportunities and discussions with tenants looking to expand operations or monetize their real estate. I wanted to note 2 very specific but very minor headwinds we experienced in the quarter in regards to AFFO.

我們注意到，與近年來的其他融資形式相比，售後回租交易現在對運營商更具吸引力。過去 6 個月，股權資本、定期貸款、CMBS 都變得更加昂貴，這使我們有更多機會與尋求擴大業務或將其房地產貨幣化的租戶進行討論。我想指出 2 個非常具體但非常小的逆風，我們在本季度遇到了關於 AFFO 的問題。

First, our restaurant subsidiary, Kerrow, experienced much lower EBITDA margin in the quarter. Sales remained strong and in line with prior quarters, but Kerrow experienced higher food and beverage, labor, utility and other services costs impacted by inflation. Kerrow has already started to see some relief in the increase in beef and other costs. So we expect this impact to moderate in the first quarter of this year.

首先，我們的餐廳子公司 Kerrow 在本季度的 EBITDA 利潤率要低得多。銷售額保持強勁並與前幾個季度持平，但 Kerrow 的食品和飲料、勞動力、公用事業和其他服務成本受到通貨膨脹的影響而上漲。 Kerrow 已經開始看到牛肉和其他成本的增加有所緩解。因此，我們預計這種影響將在今年第一季度有所緩和。

The second minor headwind was higher interest expense. 90% of our -- just over $1 billion of debt is fixed currently at a rate of 3.39%, however, interest rates on the remaining 10% of our debt are variable and pricing increased on average by over 145 basis versus the third quarter. A reminder to our investors that we think 90% fixed, 10% variable rate debt is appropriate for our business, and we benefit in some quarters, but unfortunately, we were impacted in quarters like last quarter. Our current all-in rate as of the quarter end is 3.6%.

第二個小逆風是更高的利息支出。我們 90% 的債務 - 剛剛超過 10 億美元的債務目前固定利率為 3.39%，但是，我們剩餘 10% 債務的利率是可變的，與第三季度相比，定價平均增加了 145 個基點以上。提醒我們的投資者，我們認為 90% 的固定利率和 10% 的可變利率債務適合我們的業務，我們在某些季度受益，但不幸的是，我們在上個季度這樣的季度受到了影響。截至本季度末，我們目前的總投入率為 3.6%。

In the quarter, we sold 1 property for a sales price of $4.9 million, representing a gain of $600,000. For the full year 2022, we sold 8 properties for $26 million. The strong demand for our properties provides us an attractive alternative source of capital while also improving the overall quality of the portfolio.

本季度，我們以 490 萬美元的售價出售了 1 處房產，收益為 60 萬美元。 2022 年全年，我們以 2600 萬美元的價格出售了 8 處房產。對我們物業的強勁需求為我們提供了一個有吸引力的替代資本來源，同時也提高了投資組合的整體質量。

Moving to our tenants' performance. Restaurant operators continue to have strong sales results in the most recent quarter, although many are experiencing pressure on margins as cost increases in food and labor are not fully passed on to the end consumer. However, as I mentioned earlier, while discussing Kerrow, it looks like restaurants are seeing a slowing of commodity cost increases, especially meat prices. Sales continue to hold up as restaurants are operating at approximately 120% of pre-COVID weekly sales levels and approximately 109% of last year's weekly sales levels according to Baird's Restaurant Survey reported February 6.

轉向我們租戶的表現。餐廳經營者在最近一個季度繼續取得強勁的銷售業績，儘管由於食品和勞動力成本的增加並未完全轉嫁給最終消費者，許多餐廳經營者的利潤率面臨壓力。然而，正如我之前提到的，在討論 Kerrow 時，餐廳的商品成本增長似乎正在放緩，尤其是肉類價格。根據 2 月 6 日 Baird 的餐廳調查報告，由於餐廳的營業額約為 COVID 前每週銷售水平的 120% 和去年每週銷售水平的約 109%，因此銷售額繼續保持穩定。

Our estimated EBITDAre to rent coverage stood at 4x for the 72% of our portfolio that reports this statistic. This is among the strongest coverage within the net lease industry. To reiterate a point we make almost every quarter, focusing on low rent provides cushion when inflationary input prices impact store levels.

對於報告此統計數據的 72% 的投資組合，我們估計的 EBITDAre 租金覆蓋率為 4 倍。這是淨租賃行業中最強大的報導之一。重申一個我們幾乎每個季度都會強調的觀點，即當通貨膨脹的投入價格影響商店水平時，關注低租金可以提供緩衝。

Turning to the balance sheet. We raised $72 million of equity in the fourth quarter at an average price of $26.70 per share. We also raised $30 million of incremental debt proceeds as part of extending our credit facility in October. We would also expect to continue to utilize dispositions as another source of capital.

轉向資產負債表。我們在第四季度以每股 26.70 美元的平均價格籌集了 7200 萬美元的股權。作為 10 月份擴大信貸額度的一部分，我們還籌集了 3000 萬美元的增量債務收益。我們還希望繼續利用處置作為另一種資本來源。

Finally, one comment on the team. We were very excited to announce in January the promotion of Jim Brat to serve as FCPT's Chief Operating Officer. Jim has been with us since inception. And during this time, FCPT has acquired 624 properties, grown its employee base from 6 to 35 and invested significantly in operations. Jim has been an integral part of all of this in our efforts to drive value for our shareholders, given his unique skill set in (inaudible) operations, real estate transactions and legal judgment. Thank you, Jim.

最後，對團隊發表評論。我們非常高興地在 1 月份宣布提拔 Jim Brat 擔任 FCPT 的首席運營官。吉姆從一開始就和我們在一起。在此期間，FCPT 收購了 624 處房產，員工人數從 6 人增加到 35 人，並對運營進行了大量投資。鑑於吉姆在（聽不清）運營、房地產交易和法律判斷方面的獨特技能，吉姆一直是我們為股東創造價值的努力中不可或缺的一部分。謝謝你，吉姆。

And with that, I'll turn it over to Pat.

有了這個，我會把它交給帕特。

Thanks, Bill. I'd like to start by discussing the sector mix of the $120 million of closed investments in Q4. For the quarter, restaurants accounted for 40% of new investments, auto service was 33%, medical retail was 24% and the remaining 3% consisted of other retail. Amongst others, these investments included a portfolio of 4 Buffalo Wild Wings properties in Illinois for $14 million at a 7.3% cap rate; a medical retail portfolio in Chicago for $12 million at a 6.8% cap rate; and a sale leaseback of 5 Jiffy Lube properties in Indiana for $8 million at a 6.5% cap rate.

謝謝，比爾。我想首先討論第四季度 1.2 億美元已結束投資的行業組合。本季度，餐廳佔新投資的 40%，汽車服務佔 33%，醫療零售佔 24%，其餘 3% 為其他零售。除其他外，這些投資包括伊利諾伊州的 4 個 Buffalo Wild Wings 資產組合，價值 1400 萬美元，資本化率 7.3%；以 6.8% 的上限利率以 1200 萬美元的價格在芝加哥建立醫療零售投資組合；以及印第安納州 5 處 Jiffy Lube 物業的售後回租，價格為 800 萬美元，上限率為 6.5%。

As Bill mentioned, the impact of higher interest rates allowed cap rates to trend upward last quarter. Ultimately, because of how quickly the market moved in the second half of 2022, we did go back to several sellers and discussed price adjustments. I'd also note that deals priced in the latter part of Q4 and now into 2023 have generally been above the 6.6% cap rate average for Q4. We remain highly focused on protecting our positive investment spreads.

正如 Bill 提到的那樣，較高利率的影響使上限利率在上個季度呈上升趨勢。最終，由於 2022 年下半年市場變化如此之快，我們確實回訪了幾家賣家並討論了價格調整。我還注意到，在第四季度末和現在進入 2023 年的交易定價通常高於第四季度 6.6% 的平均上限利率。我們仍然高度關注保護我們的正投資利差。

So far in 2023, we've observed cap rates give back a bit of the pricing gains we were enjoying as buyers in Q4, but not much. We believe this is a direct result of lower interest rates in 2023 and some net lease investors reentering the market. That said, we continue to bid on properties 50 to 75 basis points above where they priced in the first 8 months of last year. We've also had several sellers that previously refused our pricing in Q4 come back to us with adjusted expectations this year.

到 2023 年為止，我們觀察到資本化率回饋了我們在第四季度作為買家所享受的一些定價收益，但並不多。我們認為這是 2023 年利率下降和一些淨租賃投資者重新進入市場的直接結果。也就是說，我們繼續以比去年前 8 個月的價格高出 50 到 75 個基點的價格出價。我們也有幾位之前拒絕我們在第四季度定價的賣家今年調整後的預期返回給我們。

We remain active on the acquisitions front. As we look at our pipeline, we expect to have a busy March with a number of deals closing in the latter half of the quarter. I'd like to remind everyone that Q1 typically ends up being our lowest deal volume quarter for the year. For example, in 2021 and 2022, Q1 was 15% of acquisition volume for those years. Regarding the pipeline, we are seeing some very interesting outparcel and sale leaseback opportunities. We've been able to remain selective on tenant and real estate quality while finding deals that fit in our target yield profile.

我們在收購方面保持活躍。當我們審視我們的管道時，我們預計 3 月份會很繁忙，本季度後半段將有許多交易完成。我想提醒大家，第一季度通常是我們今年交易量最低的季度。例如，在 2021 年和 2022 年，Q1 佔當年收購量的 15%。關於管道，我們看到了一些非常有趣的外包和售後回租機會。我們一直能夠對租戶和房地產質量保持選擇性，同時找到符合我們目標收益率的交易。

Momentum on our dispositions effort has also continued. Bill mentioned, we completed the sale of 8 properties in 2022 for $26 million. We've also sold another 2 Red Lobsters and 1 Burger King so far in 2023 for $12 million. These stores were specifically selected as disposition candidates based on relative underperformance versus their respective brands. We expect to continue recycling capital opportunistically into new acquisitions, particularly where we can improve portfolio quality.

我們處置工作的勢頭也在繼續。比爾提到，我們在 2022 年以 2600 萬美元的價格完成了 8 處房產的出售。到 2023 年為止，我們還以 1200 萬美元的價格售出了另外 2 家紅龍蝦和 1 家漢堡王。這些商店是根據相對於各自品牌的相對不佳表現而被專門選為處置候選者的。我們希望繼續機會主義地將資本回收到新的收購中，特別是在我們可以提高投資組合質量的地方。

Now turning to Gerry for a discussion on our portfolio and financial results.

現在請 Gerry 討論我們的投資組合和財務業績。

Thanks, Pat. We generated $49.2 million of cash rental income in the fourth quarter after excluding $0.9 million of straight-line and other noncash rental adjustments. We reported 99.7% of collections for the fourth quarter at the end of the year and 99.9% for the full year. There were no material changes to our collectibility or credit reserves nor any balance sheet impairments in the quarter.

謝謝，帕特。在扣除 90 萬美元的直線和其他非現金租金調整後，我們在第四季度產生了 4920 萬美元的現金租金收入。我們在年底報告了第四季度 99.7% 的收款率和 99.9% 的全年收款率。本季度我們的可收回性或信用儲備沒有重大變化，也沒有任何資產負債表減值。

On a run rate basis, current annual cash base rent for leases in place as of the end of the year is $194.9 million, and our weighted average 5-year annual cash rent escalator is 1.42%. Cash G&A expense, excluding stock-based compensation for the quarter was $3.9 million representing 8% of cash rental income for the quarter, and cash G&A for the year was $15.1 million.

按運行率計算，截至年底，現有租賃的當前年度現金基本租金為 1.949 億美元，我們的加權平均 5 年現金租金遞增率為 1.42%。本季度現金 G&A 費用（不包括基於股票的薪酬）為 390 萬美元，佔本季度現金租金收入的 8%，全年現金 G&A 費用為 1510 萬美元。

For your modeling purposes, we expect cash G&A for 2023 will be approximately $16 million representing around 6% growth. The increase is tied principally to compensation expense as we focus on retention of our existing team, additional team and additional team members to bolster our investment in operating prowess. We continue to focus on technology and systems to help us with the increased complexity of the portfolio and improve efficiency. Since inception, we have grown from 6 team members to 35 today.

出於建模目的，我們預計 2023 年的現金 G&A 將約為 1600 萬美元，增長約 6%。增加主要與薪酬費用有關，因為我們專注於保留我們現有的團隊、額外的團隊和額外的團隊成員，以加強我們對運營能力的投資。我們繼續專注於技術和系統，以幫助我們應對日益複雜的產品組合併提高效率。自成立以來，我們的團隊成員已從 6 人發展到如今的 35 人。

Turning to the balance sheet. We are well capitalized to fund growth. As Bill mentioned, we raised $72 million of equity via our ATM program in the fourth quarter at an average price of $26.70 per share. On December 31, we held -- on December 31, excuse me, we held $26 million in cash and had 2.5 million shares under forward sale agreements with anticipated net proceeds of $68 million upon settlement. Including the $250 million of undrawn revolver capacity, we start the year with over $343 million of capacity.

轉向資產負債表。我們有充足的資金來支持增長。正如比爾提到的那樣，我們在第四季度通過我們的 ATM 計劃以每股 26.70 美元的平均價格籌集了 7200 萬美元的股權。 12 月 31 日，我們持有——對不起，在 12 月 31 日，我們持有 2600 萬美元現金，並根據遠期銷售協議持有 250 萬股股票，預計結算後的淨收益為 6800 萬美元。包括 2.5 億美元的未動用左輪手槍產能，我們今年年初的產能超過 3.43 億美元。

We discussed last quarter, but to remind everyone that in October, we announced an amendment to our credit facility, which reduced pricing extended maturities by 5 years on $150 million of existing term loans and raised $30 million of additional proceeds. The facility was converted from LIBOR to SOFR, credit margins were improved by 5 basis points and our overall leverage remains conservative. Our debt maturities are fully staggered with the first maturity of $50 million not due until June 2024.

我們在上個季度進行了討論，但要提醒大家，在 10 月份，我們宣布了對信貸安排的修正案，將 1.5 億美元現有定期貸款的定價延長 5 年，並籌集了 3000 萬美元的額外收益。該貸款從 LIBOR 轉換為 SOFR，信貸利潤率提高了 5 個基點，我們的整體槓桿率保持保守。我們的債務期限完全錯開，第一筆 5000 萬美元的債務要到 2024 年 6 月才到期。

We have an ongoing programmatic interest rate hedging program where we extend hedges on a regular basis to fix the rate on much of our variable rate term loans. As of the end of the year, we are hedged on $325 million of the $430 million of term loans currently at an average all-in rate of 2.79%. And as Bill mentioned, when you add the fixed rate private notes, we are over 90% hedged at a 3.39% rate.

我們有一個持續的程序化利率對沖計劃，我們定期擴大對沖以固定我們大部分可變利率定期貸款的利率。截至今年年底，我們對目前 4.3 億美元定期貸款中的 3.25 億美元進行了對沖，平均總利率為 2.79%。正如 Bill 提到的，當你添加固定利率私人票據時，我們以 3.39% 的利率對沖了 90% 以上。

With respect to overall leverage, our net debt-to-adjusted EBITDAre in the fourth quarter was 5.6x. Our fixed charge coverage ratio remains at a healthy 4.7x. Pro forma for settling and deploying the remaining equity, our leverage is approximately 5.5x and well below our target of 6x. As we discussed in the earnings press release, as of December 31, we have $75 million of forward starting swaps in place, effectively fixing the 10-year treasury base rate at 2.6% for that portion of our next long-term private note issuance.

關於整體槓桿率，我們第四季度的淨債務調整後 EBITDAre 為 5.6 倍。我們的固定費用覆蓋率保持在健康的 4.7 倍。對於結算和部署剩餘股權的備考，我們的槓桿率約為 5.5 倍，遠低於我們 6 倍的目標。正如我們在收益新聞稿中討論的那樣，截至 12 月 31 日，我們有 7500 萬美元的遠期起始掉期，有效地將我們下一次長期私人票據發行的那部分 10 年期國債基準利率固定在 2.6%。

And with that, I'll turn it back over to you, Glen, for investor questions.

有了這個，我會把它轉回給你，格倫，關於投資者的問題。

(Operator Instructions) We have our first question coming from Rob Stevenson from Janney.

（操作員說明）我們的第一個問題來自 Janney 的 Rob Stevenson。

Bill, I appreciate the color that you guys gave on the dispositions being some relative underperformers. But anything to the underperformance to Red Lobster specifically since you've been selling a number of those over the last 6 to 8 months?

比爾，我很欣賞你們對一些相對錶現不佳的性格所給予的顏色。但是，由於您在過去 6 到 8 個月內一直在銷售一些紅龍蝦，所以特別是紅龍蝦表現不佳？

Yes. Over the years, Rob, we've bought 24 Red Lobsters, $75 million-ish. They had a long lease term, and we bought them at about a 6, 7 cap. We've sold 3 of them, as you mentioned, for just over $14.5 million. So that is a couple of million dollar gain. That puts Red Lobster at under 2.5% of our rent. We have 5 that are on the market. And so that would -- and they may or may not sell, but we've had good luck thus far. That would leave 16 properties. Half of those are in a master lease that has 2x coverage and 21 years of term. And the rest are low rent ground leases that we bought in our outparcel strategy. We think those probably have coverage over 5x. .

是的。這些年來，羅布，我們已經買了 24 隻紅龍蝦，價值 7500 萬美元。他們的租期很長，我們以大約 6、7 的上限購買了它們。正如您提到的，我們已經售出其中的 3 個，售價超過 1450 萬美元。所以這是幾百萬美元的收益。這使得 Red Lobster 的租金不到我們租金的 2.5%。我們有 5 個在市場上。所以那會 - 他們可能會或可能不會出售，但到目前為止我們運氣很好。那將留下 16 個屬性。其中一半屬於主租約，承保範圍為 2 倍，租期為 21 年。其餘的是我們在外包策略中購買的低租金地面租賃。我們認為它們的覆蓋率可能超過 5 倍。 .

So those 8 properties, I think this is an important point, have -- the ground leases have just over $100,000 in rent. That would get -- if we sold those, we'd be under 2%, like just over 1.5% of rent. But I think that the 2 important things to consider on Red Lobsters is, of those 16 remaining, they have 40% lower rents than the universe of Red Lobsters that we've underwritten to date, which is 65 of them.

所以這 8 處房產，我認為這是一個重要的點，有 - 地面租賃的租金剛剛超過 100,000 美元。那會得到 - 如果我們賣掉那些，我們將低於 2%，比如租金的 1.5% 以上。但我認為紅龍蝦需要考慮的兩件重要事情是，在剩下的 16 家公司中，它們的租金比我們迄今為止承保的 65 家紅龍蝦公司的租金低 40%。

And 11 of the 16 are next to an Olive Garden or a Longhorn, adjacent to. And the remainder are also very well located. So we feel pretty comfortable. And Thai Union who owns Red Lobster discussed Red Lobster on their call, and they've provided more credit support. They're changing out management. So we feel very good about our position there.

而這 16 個中的 11 個緊挨著橄欖園或長角牛，毗鄰。其餘的位置也很好。所以我們覺得很舒服。擁有 Red Lobster 的 Thai Union 在他們的電話中討論了 Red Lobster，他們提供了更多的信貸支持。他們正在改變管理層。所以我們對我們在那裡的位置感覺很好。

Okay. And in the restaurant category, in general, are you seeing whether or not it's by price point or by offering between QSRs and limited and full service? Anything where certain people are having more pricing power and able to raise the entree prices to offset some of the higher food input costs and others are struggling with that? Or is it fairly even across the board? How should we be thinking about that as long as food input costs remain high?

好的。在餐廳類別中，一般來說，您是按價格點還是按 QSR 與有限和全面服務之間的提供來查看？某些人擁有更多定價權並能夠提高主菜價格以抵消一些較高的食品投入成本而其他人正在為此苦苦掙扎的任何事情？或者它是否相當全面？只要食品投入成本居高不下，我們應該如何考慮？

Yes. So we're seeing some brands raise prices and others really trying to attract market share and not raise prices as much, but I'd also say we're seeing these commodity costs now sort of recede a bit. So I think it's across the board.

是的。所以我們看到一些品牌提高了價格，而其他品牌則真正試圖吸引市場份額而不是提高價格，但我還要說我們看到這些商品成本現在有所下降。所以我認為這是全面的。

And the branded restaurants, the kind of restaurants we own have dramatically outperformed chef-owned and local restaurants and gained significant share. I'd also say dine-out inflation has been more moderate than supermarket or dine-in inflation.

而品牌餐廳，即我們擁有的那種餐廳，其表現大大優於廚師擁有的餐廳和當地餐廳，並獲得了很大的份額。我還要說外出就餐的通貨膨脹比超市或就餐的通貨膨脹要溫和。

Okay. And then last one for me. You guys talked about how the -- in the owned Longhorn portfolio that the expenses were the combination of food input and labor. What was the sort of breakdown? I mean, how much of the additional expenses was the food input costs that may be coming down versus labor costs, which don't appear to be abating in the near term? And anything tenants are able to do technology-wise these days to reduce staffing needs and mitigate some of the labor costs?

好的。然後最後一個給我。你們談到了 - 在擁有的 Longhorn 投資組合中，費用是食品投入和勞動力的結合。什麼樣的崩潰？我的意思是，相對於短期內似乎不會減少的勞動力成本，可能會下降的食品投入成本有多少是額外支出？這些天來，租戶能夠在技術方面做些什麼來減少人員配置需求並降低一些勞動力成本？

Yes. It's a really small number. I mean our business is so predictable that even on a $3 billion business, even $100,000 here or there seems to be noticeable because we're so predictable generally. So the delta on Kerrow was staffing up over last year, where we were struggling to find labor. We had a specific training program that increased hours in the quarter, which was sort of a one-off thing and then beef prices, which are moderating.

是的。這是一個非常小的數字。我的意思是我們的業務是如此的可預測，以至於即使在 30 億美元的業務中，這里或那裡的 100,000 美元似乎也很引人注目，因為我們通常是如此可預測的。所以 Kerrow 的三角洲在去年增加了工作人員，我們在那裡努力尋找勞動力。我們有一個特定的培訓計劃，該計劃增加了本季度的時間，這是一次性的事情，然後牛肉價格正在放緩。

But Kerrow is an exceptionally well-run business. We've had it now for 35 quarters. This is the first quarter that it's had a result that was a little lower than we expected. So I don't think there's anything to read into that. And probably most folks wouldn't even mention it, but we thought it would be worth calling out just because it was a couple of hundred thousand dollars lower than we thought it would be.

但 Kerrow 是一家經營異常出色的企業。我們現在已經有 35 個季度了。這是第一季度的結果略低於我們的預期。所以我認為沒有什麼可解讀的。可能大多數人甚至都不會提及它，但我們認為它值得大聲疾呼，因為它比我們想像的要低幾十萬美元。

Okay. And then anything on the technology side that either you guys with your own stuff or so you're seeing widespread among the tenants apply to reduce staffing needs?

好的。然後，在技術方面，你們有自己的東西，或者您看到租戶中普遍存在的任何東西都適用於減少人員需求嗎？

I mean in our acquisition effort, we use deal path to manage the process. We've actually taken a number of investors through that. We find that, that helps efficiency, keeps us very organized. When you buy a building every 1.5 days like we did in last quarter, it really -- you need to be organized and that helps us.

我的意思是在我們的收購工作中，我們使用交易路徑來管理流程。實際上，我們已經吸引了一些投資者。我們發現，這有助於提高效率，讓我們井井有條。當你像上個季度那樣每 1.5 天購買一棟建築時，你真的需要組織起來，這對我們有幫助。

We use Placer.ai to track traffic. I think that's directionally helpful. But those, I think, would be the 2 callouts for our business. And then in the restaurant level, I think the big callout would be QSR becoming almost an entirely drive-through business. It was already a majority drive-through business, but almost entirely a drive-thru business during COVID. And I would imagine over time, it will settle not at the peak of near 100% during COVID but it will settle at a higher level of drive-thru than pre-COVID.

我們使用 Placer.ai 來跟踪流量。我認為這有方向性的幫助。但我認為，這些將是我們業務的兩個標註。然後在餐廳層面，我認為 QSR 將成為幾乎完全免下車的業務。它已經是大多數免下車業務，但在 COVID 期間幾乎完全是免下車業務。而且我想隨著時間的推移，它不會穩定在 COVID 期間接近 100% 的峰值，但它會穩定在比 COVID 之前更高的得來速水平。

(Operator Instructions) We have our next question comes from Wesley Golladay from Baird.

（操作員說明）我們的下一個問題來自 Baird 的 Wesley Golladay。

I just got a question on -- a little follow-up on the Red Lobster. Obviously, some very low ground rents there. I guess, ideally, would you want to get those back? And I guess a broader picture, are you seeing much distress on the restaurant side or maybe your -- and do you still have that JV with (inaudible)? Could this all come into play at some point?

我剛剛有一個問題——關於紅龍蝦的一些後續行動。顯然，那裡的地租非常低。我想，理想情況下，你想把它們拿回來嗎？而且我想從更廣泛的角度來看，您是否看到餐廳方面或您的 - 您是否還有與（聽不清）的合資企業？這一切會在某個時候發揮作用嗎？

Yes. We've actually had pretty favorable luck on getting properties back, but the sample size is really small. Thankfully, we got back a Ruby Tuesday in Maine and re-leased it to Darden to put an Olive Garden there and had a little bit of a pickup. It's not our strategy. It can be distracting. But much rather be going into those discussions with very low rents, very low rents.

是的。實際上，我們在收回財產方面運氣不錯，但樣本量確實很小。值得慶幸的是，我們在緬因州拿回了 Ruby Tuesday，並將其重新租給了 Darden，在那裡建了一個 Olive Garden，並獲得了一些收益。這不是我們的策略。這可能會讓人分心。但更願意以非常低的租金進入那些討論，非常低的租金。

I'm not speaking to Red Lobster specifically. I'm just speaking in general. Very low rents are more likely to be reaffirmed in restructuring, all else being equal. We're not seeing a ton of distress in the restaurant space. As sales are so much higher, rent as a percentage of sales has moderated. And construction costs are so expensive that people are repurposing old buildings, and they don't want to move out of existing buildings. So I think that addresses the question.

我不是專門針對 Red Lobster 說話的。我只是籠統地說。在其他條件相同的情況下，非常低的租金更有可能在重組中得到重申。我們在餐廳空間中沒有看到太多的痛苦。由於銷售額高得多，租金佔銷售額的百分比有所下降。建築成本如此昂貴，以至於人們正在重新利用舊建築，他們不想搬出現有建築。所以我認為這解決了這個問題。

Okay. Yes. And then I'm just curious, I think you commented that the pipeline this quarter would be back-half loaded. But just curious how much visibility you have into the end of year? Is it more like a 6-month view on the pipeline that you have visibility on, understanding that some of these deals are large, complex, where you have to do a lot of work on the ground leases and carving stuff out? So just kind of curious how much visibility you have.

好的。是的。然後我很好奇，我想你評論說本季度的管道將被後半加載。但只是好奇你對年底有多少能見度？它是否更像是您對管道的 6 個月視圖，了解其中一些交易規模大、複雜，您必須在地面租賃和雕刻方面做大量工作？所以有點好奇你有多少知名度。

Yes. We have substantial visibility over the next 3 months, I would say. And then some of the properties, we know we're going to purchase them but we know that there are steps that need to take place. And sometimes in the outparcels that could take a year, for certain jurisdictions more. And so we try not to be overly fussed with managing the pipeline quarter-to-quarter.

是的。我想說，在接下來的 3 個月裡，我們有很大的知名度。然後是一些房產，我們知道我們將購買它們，但我們知道需要採取一些步驟。有時在外圍地區可能需要一年的時間，對於某些司法管轄區，時間更長。因此，我們盡量不要過分關注每季度管理管道。

Once you own these buildings, you have to live with the consequences of your decision to buy them. So the last thing you want to do is lower your quality expectations in order to even out a quarter. But as Patrick mentioned, it's typically busy at the end of the last -- the end of the year as it was last year and then a little softer in Q1. So this is, frankly, the same dynamic we've had for the last 3 years.

一旦您擁有這些建築物，您就必須承受您決定購買它們的後果。所以你最不想做的就是降低你的質量期望，以平衡四分之一。但正如帕特里克提到的那樣，它通常在最後一個年底很忙——就像去年一樣，今年年底，然後在第一季度有點疲軟。所以，坦率地說，這與我們過去 3 年的動態相同。

Got it. And then maybe just one for Gerry. How should we think about timing of a debt deal? Once you get to the line to a certain level, just take down the debt issuance?

知道了。然後也許只有一個給格里。我們應該如何考慮債務交易的時機？線到了一定程度，就把發債拿下來？

Yes. Great question. Sometime this year would be the answer I would give. Obviously, our line of credit was 0 balance on that at the end of the year. We've got forwards at the start of the year. So we're in great shape. But we will also be opportunistic to take advantage of that market when we see margin rates.

是的。很好的問題。今年的某個時候將是我給出的答案。顯然，我們的信貸額度在年底時是 0 餘額。我們在今年年初就取得了進展。所以我們的狀態很好。但當我們看到保證金率時，我們也會抓住機會利用該市場。

In the private note market, you can forward fund. That forward funding option has actually extended as the curve is negative now and thus insurance companies are more willing to do that. So I think we have a lot of optionality around when we do it.

在私募票據市場，可以遠期資金。由於現在曲線為負，因此遠期融資選擇實際上已經擴大，因此保險公司更願意這樣做。所以我認為我們在做這件事時有很多選擇餘地。

(Operator Instructions) We have our next question comes from John Massocca from Ladenburg Thalmann.

（操作員說明）我們的下一個問題來自 Ladenburg Thalmann 的 John Massocca。

Maybe on the acquisition side of things. As you think about the competitive set when you're going into kind of speaking out deals or closing deals. I mean what's been happening with the 1031 buyer over the last couple of months? Has that faded away a little bit as the year has ended? Has that strengthened? I should say, by 1031 buyer, I mean just individual buyers, high net worth buyers, et cetera.

也許在收購方面。當你在談論交易或完成交易時考慮競爭環境。我的意思是過去幾個月 1031 買家發生了什麼事？隨著這一年的結束，這種情況有一點消失了嗎？那加強了？我應該說，1031買家，我指的只是個人買家，高淨值買家等等。

Sure. So 1031s require what's called a down leg, the asset that they are selling where the proceeds get escrowed and then reinvested in assets they're buying. And so the transaction market for the down leg, which is very often not net lease. It's usually an apartment building very typically. So the transaction volume of those have fallen consequently with a lag, the amount of 1031 buyers in the market has fallen. That doesn't mean it's not still competitive. But those are often levered buyers and their cost of financing has gone up.

當然。因此，1031 需要所謂的下行資產，即他們出售的資產，收益在託管的地方，然後再投資於他們購買的資產。因此，下游的交易市場通常不是淨租賃。它通常是非常典型的公寓樓。所以成交量隨之滯後下降，1031個入場買家數量下降。這並不意味著它仍然沒有競爭力。但這些買家通常是槓桿買家，他們的融資成本已經上升。

So there was a dynamic, as Patrick alluded to in his comments, where properties that were on the market over the summer and fall had to readdress their pricing. Those properties are -- have either been pulled from the market or were actually sold. And now we're in the process of new properties entering the market with different pricing expectations. I would also maybe add on that we were anticipating in 2021 heading into 2022, a large influx of private equity. New private equity vehicles in that lease. Those obviously, much more leverage focused. And as cost of financing has gone up, their ability to create attractive yields has declined. So we're seeing less competition from private equity funds than we thought we would experience.

因此，正如帕特里克在他的評論中提到的那樣，存在一種動態，夏季和秋季上市的房產不得不重新定價。這些房產是 - 已經從市場上撤出或實際出售。現在我們正在以不同的定價預期進入市場的新物業。我還可以補充一點，我們預計 2021 年到 2022 年，大量私募股權湧入。該租約中的新私募股權工具。那些顯然更注重槓桿作用。隨著融資成本的上升，它們創造有吸引力的收益率的能力下降了。因此，我們看到來自私募股權基金的競爭比我們想像的要少。

Okay. That makes sense. And then maybe in terms of the in-place credit or the credit on potential acquisitions, how are you thinking about franchise versus kind of corporate owned, especially given some of the pricing pressures that are kind of being seen industry-wide? And you mentioned kind of (inaudible) personally on the Kerrow side of your business.

好的。這就說得通了。然後，也許就就地信用或潛在收購的信用而言，您如何看待特許經營權與公司所有，特別是考慮到一些在整個行業範圍內都存在的定價壓力？你在你的業務的 Kerrow 方面提到了某種（聽不清）個人。

Yes. I think we've always been pretty thoughtful and conservative around the kind of credit. Credit is roughly half of our underwriting model, roughly the remaining half is real estate matters. But I wouldn't necessarily draw the line, franchise versus corporate, too literally. There are some very, very large franchise businesses, and there are some very small or levered corporate operated properties.

是的。我認為我們在這種信用方面一直非常周到和保守。信貸大約占我們承銷模式的一半，大約剩下的一半是房地產問題。但我不一定會從字面上劃清界限，特許經營與公司。有一些非常非常大的特許經營業務，也有一些非常小或槓桿公司經營的物業。

So we've never really played in the very small franchisee financing game that some of our peers have. And you'll see our cap rates are relatively consistent, adjusted for what's happening in the market. So we're not going out the risk's curve by any means.

所以我們從來沒有真正參與過我們的一些同行所擁有的非常小的特許經營融資遊戲。你會看到我們的資本化率相對一致，並根據市場情況進行了調整。因此，我們不會以任何方式走出風險曲線。

Okay. And as you look at kind of either the financials that are being reported to you or financials on new transactions, I mean, what are you seeing in terms of responses to some of these pricing pressures in the casual dining space versus the QSRs? Actually (inaudible) rather than respond to more just kind of the impact of some of those pricing pressures.

好的。當您查看報告給您的財務狀況或新交易的財務狀況時，我的意思是，您對休閒餐飲空間與 QSR 中的一些定價壓力的反應有何看法？實際上（聽不清）而不是對其中一些定價壓力的影響做出更公正的反應。

Yes. I think what we felt at Kerrow is pretty consistent in what's happening in the industry. In 2021, in many cases, you couldn't get to the staffing levels you wanted to. So that led to sort of abnormal profitability, but it was at the -- with the consequence of not being able to serve the guest. So I think you're seeing more staffing, you're seeing commodity costs increase. But again, both of those factors are moderating in real time.

是的。我認為我們在 Kerrow 的感受與行業中正在發生的事情非常一致。在 2021 年，在許多情況下，你無法達到你想要的人員配備水平。因此，這導致了某種異常的盈利能力，但結果是無法為客人提供服務。所以我認為你會看到更多的員工，你會看到商品成本增加。但同樣，這兩個因素都在實時緩和。

And what's happened is a number of the weaker brands or over-levered franchisees have struggled, and we don't play in that sandbox.

發生的事情是一些較弱的品牌或過度槓桿化的特許經營商一直在苦苦掙扎，我們不在那個沙盒裡玩。

(Operator Instructions) We have our next question comes from Tayo Okusanya from Credit Suisse.

（操作員說明）我們的下一個問題來自瑞士信貸的 Tayo Okusanya。

Bill, just given some of your comments around kind of what's happening with the restaurants and generally what's happening with retail, curious if you guys would consider at any point looking beyond the world of retail for acquisition opportunities?

比爾，剛剛給出了一些關於餐館正在發生的事情以及零售業正在發生的事情的一些評論，好奇你們是否會考慮在任何時候超越零售世界尋找收購機會？

Yes. We are always looking at strategies, acquisitions that are adjacent to what we have purchased in the past. We have a formal process with our Board where we review adjacencies annually. We started with restaurant only, we've now bought obviously, a number of medical retail and a number of auto service retail. We continue to try to expand the aperture of our acquisition apparatus thoughtfully. But I wouldn't expect us to buy hotels or apartment buildings or office or anything like that.

是的。我們一直在關注與我們過去購買的產品相鄰的戰略和收購。我們與董事會有一個正式的流程，我們每年都會審查鄰接關係。我們只從餐廳開始，現在我們顯然已經購買了一些醫療零售和一些汽車服務零售。我們繼續深思熟慮地嘗試擴大採集設備的孔徑。但我不希望我們購買酒店或公寓樓或辦公室或類似的東西。

I think it's more of a natural progression. And if you look at some of the older and larger net lease REITs, they follow that same path over a long period of time, and it's worked quite well for them.

我認為這更像是一種自然的進步。如果你看看一些較老的和較大的淨租賃房地產投資信託基金，它們會在很長一段時間內遵循相同的路徑，並且對它們來說效果很好。

(Operator Instructions) We have no further questions on the line.

（操作員說明）我們沒有其他問題了。

Great. Thank you, everyone, and management is available for Q&A if anyone is interested. Thanks again for joining the call.

偉大的。謝謝大家，有興趣的可以問答。再次感謝您加入電話會議。

Thank you. Ladies and gentlemen, this concludes today's call. Thank you for joining. You may now disconnect your lines.

謝謝。女士們，先生們，今天的電話會議到此結束。感謝您的加入。您現在可以斷開線路。