Realty Income Corp (O) 2024 Q2 法說會逐字稿

Good day, and welcome to the Realty Income second-quarter 2024 earnings conference call. (Operator Instructions) Please note, this event is being recorded.

美好的一天，歡迎參加 Realty Income 2024 年第二季財報電話會議。 （操作員說明）請注意，正在記錄此事件。

I would now like to turn the conference over to Steve Bakke, Senior Vice President, Corporate Finance. Please go ahead.

現在我想將會議交給企業財務資深副總裁 Steve Bakke。請繼續。

Thank you all for joining us today for Realty Income's second-quarter operating results conference call. Discussing our results will be Sumit Roy, President and Chief Executive Officer and Jonathan Pong, Chief Financial Officer and Treasurer.

感謝大家今天參加 Realty Income 第二季經營業績電話會議。總裁兼執行長 Sumit Roy 和財務長兼財務主管 Jonathan Pong 將討論我們的業績。

During this conference call, we will make statements that may be considered forward-looking statements under federal securities law. The company's actual future results may differ significantly from the matters discussed in any forward-looking statements. We will disclose in greater detail the factors that may cause such differences in the company's Form 10-Q. We will be observing a two-question limit during the Q&A portion of the call in order to give everyone the opportunity to participate. If you would like to ask additional questions, you may re-enter the queue.

在本次電話會議期間，我們將發表根據聯邦證券法可能被視為前瞻性聲明的聲明。本公司未來的實際業績可能與任何前瞻性陳述中討論的事項有顯著差異。我們將在公司的 10-Q 表格中更詳細地揭露可能導致此類差異的因素。在電話問答部分，我們將遵守兩個問題的限制，以便讓每個人都有機會參與。如果您想提出其他問題，可以重新進入佇列。

I will now turn the call over to our President and CEO, Sumit Roy.

我現在將把電話轉給我們的總裁兼執行長 Sumit Roy。

Thank you, Steve. Welcome, everyone. In the second quarter, I'm pleased we were able to deliver strong results to the economy as well as the transaction market navigate today's rate environment. We seek to be real estate partners to the world's leading companies. And the diligent efforts of our dedicated team resulted in AFFO per share of $1.06, representing a robust 6% growth compared to last year.

謝謝你，史蒂夫。歡迎大家。在第二季度，我很高興我們能夠在當今的利率環境下為經濟和交易市場帶來強勁的業績。我們尋求成為世界領先公司的房地產合作夥伴。經過我們專業團隊的辛勤努力，每股 AFFO 達到 1.06 美元，與去年相比強勁增長 6%。

Combined with our annualized dividend yield in excess of 5%, our shareholders own the total operational return of over 11%. The power of our global sourcing and acquisition platform was on display this quarter as we deployed capital in the US and Europe across retail, industrial, and data center real estate, and the real estate backed credit opportunities.

加上我們超過 5% 的年化股息殖利率，我們的股東擁有超過 11% 的總營運回報。我們的全球採購平台的力量在本季度得到了體現，我們在美國和歐洲的零售、工業和數據中心房地產以及房地產支持的信貸機會上部署了資本。

In total, we invested $805.8 million into high quality opportunities at a blended 7.9% initial cash yield or an 8.2% straight line yield, assuming CPI growth of 2%. Of this, approximately $262 million of volume was invested in the US at a 7.6% initial cash yield. The balance of approximately $544 million was invested in Europe at an 8% initial cash yield, including a $377.5 million investment in a secured note at an 8.1% yield issued Asda, a leading UK grocery operator.

假設 CPI 成長 2%，我們總共向高品質機會投資了 8.058 億美元，初始現金收益率為 7.9%，直線收益率為 8.2%。其中，約 2.62 億美元投資於美國，初始現金收益率為 7.6%。約 5.44 億美元的餘額以 8% 的初始現金收益率投資於歐洲，其中包括 3.775 億美元投資於英國領先雜貨營運商 Asda 發行的擔保票據，收益率為 8.1%。

As we discussed in the past, we intend to pursue credit investments selectively and only when it may eventually facilitate access to high-quality real estate opportunities as has been the case with Asda. We also believe these credit investments represent a profitable means for Realty Income to participate in and benefit from the current rate environment. Furthermore, from a risk management perspective, we view this credit investments as a prudent natural hedge to the inherent rate exposure as we have on the liability side of our balance sheet. Providing further detail on investments in the quarter, we executed 79 discrete transactions with 55 clients, including two new clients across 22 industries. 31% of direct real estate investment volume was allocated to new sale leasebacks.

正如我們過去所討論的，我們打算有選擇地進行信貸投資，並且只有當它最終有助於獲得高品質的房地產機會時，就像阿斯達的情況一樣。我們也認為，這些信貸投資是 Realty Income 參與當前利率環境並從中受益的獲利手段。此外，從風險管理的角度來看，我們認為這種信貸投資是對資產負債表負債端固有利率風險的審慎自然對沖。我們提供了有關本季度投資的更多詳細信息，我們與 55 個客戶執行了 79 筆離散交易，其中包括 22 個行業的兩個新客戶。直接房地產投資額的 31% 分配給了新的售後回租。

Touching on our sourcing activity, we were pleased that our transaction disciplined earlier this year is bearing fruit. As this quarter, we began to see a greater number of opportunities available at pricing that aligns with our cost of capital. This improvement supported the $200 million increase in transaction volumes sequentially, and it drove the investment guidance increased to $3 billion in June of 50% increase from our prior guidance. We believe the higher close volume paired with investment spreads that are largely consistent with last quarter are signed that transaction market may be moving towards normalization.

談到我們的採購活動，我們很高興今年早些時候嚴格執行的交易正在取得成果。從本季開始，我們開始看到更多的機會，其定價與我們的資本成本相符。這項改善支持交易量較上季增加 2 億美元，並推動 6 月的投資指引增加至 30 億美元，較先前的指引增加 50%。我們認為，較高的成交量以及與上季基本一致的投資利差表明交易市場可能正在正常化。

Investment activity this quarter was funded in large part by adjusted free cash flow, which total approximately $200 million in the second quarter. Not having to rely on public equity enhance the accretive nature of these transactions. Deployment of excess cash flow represents an important contributor to our growth. In fact, we believe we can utilize excess free cash flow together with our portfolio's internal rent growth to deliver an approximate 7% to 8% total operation return annually to shareholders without relying on public equity issuance.

本季的投資活動很大程度上由調整後的自由現金流提供資金，第二季的自由現金流總額約為 2 億美元。不必依賴公共股權增強了這些交易的增值性質。多餘現金流的部署是我們成長的重要貢獻者。事實上，我們相信，我們可以利用多餘的自由現金流以及投資組合的內部租金成長，在不依賴公開股票發行的情況下，每年為股東帶來約 7% 至 8% 的總營運回報。

The portfolio stabilizing total growth rate has risen in recent years and now stands at approximately 1.5% on an annualized basis, in part because of the expansion of our European platform, where many leases are subject to uncapped CPI increases as well as our expansion into the gaming and datacenter verticals, which where leases are often include healthy annual rent escalators. With the benefit of excess free cash flow, second-quarter capital deployment activity resulted in investment spread of approximately 293 basis points, which like the first quarter, is well above our historical spread of 150 basis points in part due to the utilization of excess free cash flow.

近年來，穩定總成長率的投資組合有所上升，目前年化成長率約為1.5%，部分原因是我們歐洲平台的擴張，其中許多租賃受到無上限CPI 上漲的影響，以及我們向歐洲市場的擴張。受惠於超額自由現金流，第二季資本配置活動導致投資利差約為293 個基點，與第一季一樣，遠高於我們歷史上150 個基點的利差，部分原因是利用了超額自由現金流量。

As a reminder, these disclosed investment spreads utilize our short-term nominal cost of capital, which measures the estimated year one earnings dilution from raising capital on a leverage-neutral basis to fund our investment volume. This is different from a higher long-term cost of capital, which implies a growth premium to our cost of equity to account for the long-term return requirements for our investors. While we remain vigilant in today's volatile environment, seeking only the most attractive risk-adjusted return opportunities, we will also only utilize external capital opportunistically aiming to augment our growth rate at times when our cost of capital becomes increasingly attractive as compared to prevailing market investment yields.

提醒一下，這些揭露的投資利差利用了我們的短期名目資本成本，該成本衡量了在槓桿中性的基礎上籌集資金為我們的投資額提供資金所造成的估計第一年收益稀釋。這與較高的長期資本成本不同，後者意味著我們的股本成本存在成長溢價，以滿足投資者的長期回報要求。雖然我們在當今動盪的環境中保持警惕，只尋求最具吸引力的風險調整回報機會，但我們也只會在我們的資本成本與當前市場投資相比變得越來越有吸引力時，機會性地利用外部資本，以提高我們的成長率產量。

An additional source of capital in the second quarter was dispositions. We utilize proprietary predictive analytic tools in combination with the insights of our asset management and research teams who drive the decision to sell 75 properties for total net proceeds of approximately $106 million, bringing the year-to-date total to approximately $202 million. For the year, we expect to sell between $400 million and $500 million of assets.

第二季的另一個資金來源是處置。我們利用專有的預測分析工具，結合我們的資產管理和研究團隊的見解，推動我們做出出售75 處房產的決定，淨收益總額約為1.06 億美元，使年初至今的淨收益總額達到約2.02億美元。今年，我們預計將出售 4 億至 5 億美元的資產。

As we continue to calibrate and hone our predictive analytic tools, advancing our investment thesis on each property in our portfolio, we may be more active on dispositions than in the past. We continue to optimize our portfolio composition and investment returns while broadening our use of organically generated capital to finance growth.

隨著我們繼續校準和磨練我們的預測分析工具，推進我們對投資組合中每項房產的投資理論，我們可能會比過去更積極地進行配置。我們持續優化投資組合組成和投資回報，同時擴大對自然產生的資本的使用，為成長提供資金。

Another critical point of differentiation for Realty Income is the strength of our balance sheet, underpinned by our low leverage of A3/A- credit ratings by Moody's and S&P, respectively, and our access to capital on a global basis. During the second quarter of 2024, the combination of internally generated cash flow and dispositions sale proceeds allowed us to fund most of our investment activity without settling any newly issued equity capital while still maintaining a leverage metrics at or below our long-term targets.

Realty Income 的另一個差異化關鍵點是我們的資產負債表實力，這得益於我們分別獲得穆迪和標準普爾的A3/A- 信用評級的低槓桿率，以及我們在全球範圍內獲得資本的渠道。 2024 年第二季度，內部產生的現金流量和處置銷售收益相結合，使我們能夠為大部分投資活動提供資金，而無需結算任何新發行的股本，同時仍將槓桿指標維持在或低於我們的長期目標。

Shifting to operations, our portfolio continues to generate a very solid returns and perform in a very stable fashion. Occupancy rose to 98.8% as of June 30, a 20 basis point increase from the prior quarter. Additionally, our rent recapture rate across 199 leases was 105.7%, totaling approximately $34 million in new annualized cash rent. The size, scale, diversification, and consistency of performance from our global real estate portfolio continues to provide us with an excellent visibility to revenue and is a key reason why we have not had a single year of negative operational return in our 30 years as a public company.

轉向運營，我們的投資組合繼續產生非常可觀的回報，並以非常穩定的方式表現。截至 6 月 30 日，入住率升至 98.8%，較上一季成長 20 個基點。此外，我們 199 份租賃的租金回收率為 105.7%，新增年化現金租金總計約 3,400 萬美元。我們全球房地產投資組合的規模、規模、多元化和業績一致性繼續為我們提供了出色的收入可視性，這也是我們在30 年的營運經驗中沒有出現過任何一年出現負營運回報的關鍵原因。

Managing through periodic store closures is a natural part of our business model and the top credit research and asset management teams of a distinct competitive advantages, which have consistently enabled us to optimize value in these situations. To that end, we would like to provide remarks in a few clients that are currently managing through store closures or have been in the news due to credit related concerns.

透過定期關閉商店進行管理是我們業務模式的自然組成部分，頂級信用研究和資產管理團隊具有明顯的競爭優勢，這使我們能夠在這些情況下始終優化價值。為此，我們想對一些目前正在關閉商店或因信用相關問題而出現在新聞中的客戶提供評論。

Importantly, in the context of our portfolios size and scale, the aggregate financial exposure or potential lost rent is not expected to materially impact our ability to generate the consistent operational returns our shareholders are accustomed to. And it is important to emphasize, our recent increase in our earnings guidance takes all credit considerations into account.

重要的是，就我們的投資組合規模而言，整體財務風險或潛在的租金損失預計不會對我們產生股東所習慣的一致營運回報的能力產生重大影響。需要強調的是，我們最近提高獲利指引時考慮了所有信貸因素。

Rite Aid, which represents 30 basis points of our total portfolio annualized contractual rent as of June 30, 2024 is expected to emerge from bankruptcy in the third quarter. Through the remainder of the bankruptcy process, we expect to lose 12 basis points of rent prior to the resolution of assets vacated in the proceedings, which are ultimately be released or sold.

截至 2024 年 6 月 30 日，Rite Aid 占我們總投資組合年化合約租金的 30 個基點，預計將在第三季擺脫破產。在破產程序的剩餘時間裡，我們預計在解決程序中騰出的資產（最終將被釋放或出售）之前，租金將損失 12 個基點。

Red Lobster represents 1% of our total portfolio annualized contractual rents. And it is currently moving through the bankruptcy process. At present, as publicly stated, Red Lobster is targeting to emerge from bankruptcy in the third quarter of 2024. We continue to believe that our visibility into rent coverage and our master lease structure across most of our properties mitigate some of our potential risks. And while not finalized, we currently believe our recapture rate would be roughly in line with our historical portfolio weighted average of 84% for client bankruptcy restructurings.

紅龍蝦占我們投資組合年化合約租金總額的 1%。目前該公司正在辦理破產程序。目前，正如公開聲明的那樣，Red Lobster 的目標是在2024 年第三季度擺脫破產。 。雖然尚未最終確定，但我們目前認為，我們的重新奪回率將與我們歷史上客戶破產重整投資組合加權平均值 84% 大致一致。

Walgreens is considered closing certain stores. Looking out over the next 2.5 years, we have leases representing only 26 basis points of our total portfolio annualized contractual rent that will expire over that time. Outside of a bankruptcy scenario, which we view as unlikely with Walgreens, these are the only stores Walgreens can legally see contractual rent payments on once each lease expires. To provide context on historical capture rates in the drugstore industry, we have managed 166 lease expirations since 2013. 80% of these were renewed that resulted in a blended recapture rate in excess of 100% of prior rent.

沃爾格林正在考慮關閉某些商店。展望未來 2.5 年，我們的租賃僅占我們總投資組合年化合約租金的 26 個基點，並將在此期間到期。除了我們認為沃爾格林不太可能出現破產的情況外，這些是沃爾格林在每次租約到期後可以合法地支付合約租金的唯一商店。為了提供藥局行業歷史回收率的背景信息，自 2013 年以來，我們管理了 166 個租賃到期事件。

Dollar Tree, which is investment grade rated, announced the potential split of the Family Dollar brand from Dollar Tree. If this would result in store closings, Family Dollar leases representing only five basis points of our total portfolio annualized contractual rent are set to expire between now and year-end 2026. And of course, in the interim, they're obligated to continue paying rent through lease expiration. Our historical recapture results in the dollar store industries have been similarly favorable. We have managed 263 lease expirations since 2013, of which 86% of the clients renewed at a weighted average rate well north of 105%.

獲得投資等級的 Dollar Tree 宣布 Family Dollar 品牌可能會從 Dollar Tree 中拆分出來。如果這會導致商店關閉，僅占我們總投資組合年化合約租金五個基點的 Family Dollar 租賃將從現在到 2026 年底到期。 。我們在一元商店產業的歷史重獲結果也同樣令人滿意。自 2013 年以來，我們已管理了 263 個租賃到期案例，其中 86% 的客戶續約率遠高於 105%。

In case of our tier exposure, we feel the risks have notably diminished in the past 12 months. Cineworld reduced its debt by $4.5 billion through its restructuring, and AMC recently made improvements to its financial position by extending debt maturities and additional equity issuance. It is important to note that in total, the rent at risk from Rite Aid, Red Lobster, Walgreens, Dollar Tree, as well as at home and big lots, which is 11 basis points of rent, represents in total only 2.3% of our total portfolio annualized contractual rent through year-end 2026. And if we achieve the recapture rate in line with our long-term average for bankruptcies, which is 84%, this suggests only approximately 37 basis points of rent is at risk of ceasing or an approximately $0.02 of AFFO per share impact.

就我們的分級風險而言，我們認為過去 12 個月風險已顯著降低。 Cineworld 透過重組減少了 45 億美元的債務，AMC 最近透過延長債務期限和額外發行股票來改善其財務狀況。值得注意的是，總體而言，Rite Aid、Red Lobster、Walgreens、Dollar Tree 以及家庭和大地塊的租金風險為 11 個基點，僅占我們的 2.3%到2026 年底的總投資組合年化合約租金。

In addition, if they do take place, advanced notice of potential store closures are of incremental value to us because they provide years in many instances to plan the optimal outcome at those locations where the clients plan is to meet while we continue to be paid rent. This $0.02 per share potential impact is manageable and is counterbalanced by the power and stability of our net lease business model, which is underpinned by diversification across more than 15,000 properties, 1,500 clients and 8 countries on 2 continents. Hence, we believe it is important to separate the store closing headlines from the manageable impact they have on our financials.

此外，如果確實發生，提前通知潛在的商店關閉對我們來說具有增量價值，因為在許多情況下，它們提供了數年的時間來在客戶計劃會面的地點規劃最佳結果，同時我們繼續支付租金。每股0.02 美元的潛在影響是可控的，並被我們淨租賃業務模式的力量和穩定性所抵消，該模式的基礎是跨越15,000 多個物業、1,500 個客戶和2 大洲8 個國家的多元化。因此，我們認為，將商店關閉的頭條新聞與它們對我們財務產生的可控制的影響分開是很重要的。

With that, I would like to turn it over to Jonathan to discuss our second-quarter financial results in more detail. Jonathan?

至此，我想將其交給喬納森，更詳細地討論我們第二季的財務表現。喬納森？

Thanks, Sumit. Consistency has long been a benchmark by which we manage our business. For that end, we ended the second quarter with leverage of 5.3 times without settling any ATM equity for the quarter. This was the 25th consecutive quarter for leverage at 5.5 times or lower, reflecting our commitment to our A3/A credit ratings, which we have had now since 2018. As a reminder, we manage our leverage through the lens of net debt and preferred equity to annualized pro forma adjusted EBITDA.

謝謝，蘇米特。一致性長期以來一直是我們管理業務的基準。為此，我們在第二季末的槓桿率為 5.3 倍，但沒有結算本季的任何 ATM 權益。這是槓桿率連續 25 個季度處於 5.5 倍或更低，反映了我們自 2018 年以來對 A3/A 信用評級的承諾。年化預計調整後EBITDA。

During the second quarter, we generated approximately $200 million of adjusted free cash flow of $100 million and real estate sales proceeds and approximately $185 billion, afford unsettled equity sold through the ATM. After modest ATM issuance activity subsequent to quarter end, we currently have almost $450 million of unsettled forward equity, which we estimate will be more than sufficient to finance our equity needs for the remainder of 2024 and still remain within our target leverage ratios.

第二季度，我們產生了約 2 億美元的調整後自由現金流和 1 億美元的房地產銷售收益，以及透過 ATM 出售的約 1,850 億美元的未結算股權。在季度末後進行了適度的ATM 發行活動之後，我們目前有近4.5 億美元的未結算遠期股權，我們估計這足以滿足我們2024 年剩餘時間的股權需求，並且仍保持在我們的目標槓桿率範圍內。

Our balance sheet remains healthy with a well-staggered debt maturity schedule that allows us to be active should borrowing cost trend lower over the maturity cycle. Last month, we repaid $350 million of maturing public notes, leaving us with only $118 million of maturing mortgage debt for the balance of the year. Our exposure to variable rate debt of $1.6 billion remains modest at only 6.3% of total debt principal at quarter end. And our liquidity remains solid with access to approximately $3.8 billion of capital at the end of the second quarter, inclusive of cash on hand, available under our $4.25 billion revolving credit facility and our outstanding ATM forward equity.

我們的資產負債表保持健康，債務到期時間表錯開，這使我們能夠在到期週期內借貸成本趨於下降的情況下保持積極主動。上個月，我們償還了 3.5 億美元的到期公開票據，今年剩餘時間我們只剩下 1.18 億美元的到期抵押貸款債務。截至季末，我們的 16 億美元可變利率債務風險仍不大，僅佔總債務本金的 6.3%。我們的流動性依然穩定，在第二季末可獲得約 38 億美元的資本，其中包括我們 42.5 億美元循環信貸安排和未償 ATM 遠期股本下可用的手頭現金。

We remain comfortable the liability side of the balance sheet and believe we are well positioned to act on larger investment opportunities should they present themselves. As Sumit mentioned earlier, we view our credit investments as a natural hedge to the inherent interest rate risk associated with debt maturities we have on our balance sheet.

我們對資產負債表的負債部分仍然感到放心，並相信，如果更大的投資機會出現，我們將有能力採取行動。正如薩米特之前提到的，我們將信貸投資視為對資產負債表上與債務到期相關的固有利率風險的自然對沖。

That end, the six-years GBP300 million sterling senior secured loan we invested in during the quarter provides us with an attractive 8.1% yield, secured by the solid credit of the UK grocery store operator, while reducing the rate sensitivity on the value of sterling debt we have in the balance sheet maturing in 2030, which currently totals by [GBP540 million]. From 2024 earnings guidance perspective, we are reiterating our full year investment guidance at $3 billion and our AFFO per share guidance of $4.15 to $4.21, which represents 4.5% annual per share growth assuming the midpoint.

為此，我們在本季度投資的6 年期3 億英鎊高級擔保貸款為我們提供了有吸引力的8.1% 收益率，由英國雜貨店運營商的可靠信用擔保，同時降低了英鎊價值的利率敏感性我們資產負債表中的債務將於 2030 年到期，目前總計為 [5.4 億英鎊]。從 2024 年獲利指引的角度來看，我們重申全年投資指引為 30 億美元，AFFO 每股指引為 4.15 至 4.21 美元，假設中點，這意味著每股年增長率為 4.5%。

As a reminder, we increased our guidance on June 4, which included the expectation of collecting the $16 million of lease termination fees that will be recognized in the second quarter. Offsetting a portion of the AFL tailwinds from termination fees was the recognition of approximately $6.2 million of AR reserves from one of our clients in the convenience store industry.

提醒一下，我們在 6 月 4 日提高了指導值，其中包括預計收取將在第二季確認的 1,600 萬美元租賃終止費用。我們便利商店產業的一位客戶確認了約 620 萬美元的 AR 儲備，抵消了 AFL 終止費用帶來的部分不利影響。

Lease termination of fees are excluded in our same-store rental revenue calculations, while AR reserves are included, and thus the $6.2 million of reserves that we recognized on one client in the quarter alongside impact our theater portfolio, called back our second quarter same-store rent growth by approximately 60 basis points, resulting in overall same-store growth of 0.2% for the quarter. Including this reserve, we continue to expect our full year same-store rental revenue growth recovered to close to the 1% level for 2024.

我們的同店租金收入計算中不包括租賃終止費用，而AR 準備金則包括在內，因此，我們在本季度向一位客戶確認的620 萬美元準備金同時影響了我們的劇院投資組合，回調了我們第二季的同店租金收入。包括這筆儲備在內，我們繼續預計 2024 年全年同店租金收入成長將恢復至接近 1% 的水平。

With that, I'd like to hand the call back to Sumit for closing remarks.

至此，我想將電話轉回 Sumit 進行結束語。

Thank you, Jonathan. To conclude our prepared remarks, this year is progressing largely in line with expectations, perhaps even slightly ahead. There are signs that transaction market is beginning to normalize as we find more opportunities to deploy capital into high-quality investments, meeting our minimum return requirements.

謝謝你，喬納森。總而言之，今年的進展基本上符合預期，甚至可能略有提前。有跡象表明，交易市場開始正常化，我們找到了更多的機會將資金配置到高品質的投資上，滿足我們的最低迴報要求。

Adjusted free cash flow and dispositions continue to be accretive sources of capital we can use to support future growth. Combined with the stability of our solidly performing client base and the strength of our balance sheet, we believe we are well positioned to deliver attractive risk adjusted returns to shareholders in a variety of economic environments.

調整後的自由現金流和處置仍然是我們可以用來支持未來成長的資本增值來源。結合我們表現強勁的客戶群的穩定性和我們的資產負債表的實力，我們相信我們有能力在各種經濟環境下為股東提供有吸引力的風險調整回報。

I'd like to now open it up for questions. Operator?

我現在想打開它來提問。操作員？

(Operator Instructions) Michael Goldsmith, UBS.

（操作員說明）Michael Goldsmith，UBS。

Good afternoon. Thanks for taking my question. The largest component of your investment volume this quarter was the investment in the Asda notes. How should we think about this different investment buckets that you have when it comes to expectations for the back half of the year? Thanks.

午安.感謝您提出我的問題。本季您投資額的最大組成部分是對阿斯達票據的投資。當談到下半年的預期時，我們該如何看待你們的不同投資目標？謝謝。

Thank you, Michael. That's correct. We did have a $377 million investment in the Asda loan, which was very opportunistic, and we've already highlighted the reasons as to why we did that.

謝謝你，麥可。這是正確的。我們確實在阿斯達貸款中投資了 3.77 億美元，這是非常機會主義的，我們已經強調了我們這樣做的原因。

What you should expect for the balance of the year, for the remaining half of the year is that we are probably going to have the majority of our investments, if not 100% of our investments in our more traditional investment asset level portfolio level real estate, direct investment. That's what's going to make up the balance of the remaining six months.

你應該預期今年剩下的時間裡，我們的大部分投資（如果不是 100%）可能會投資於我們更傳統的投資資產等級的投資組合層級的房地產、直接投資。這將彌補剩餘六個月的餘額。

Got it. And then as a follow-up, can you talk a little bit about the opportunities you're seeing in the US versus European markets outside the loan? You leaned a little bit more to the US in the second quarter or a reversal from the first quarter. So can you talk a little bit about what you're seeing in these markets and the spreads in the US versus Europe? Thanks.

知道了。作為後續行動，您能談談您在美國和歐洲市場看到的貸款之外的機會嗎？第二季度你比較傾向美國，或是與第一季相比有所逆轉。那麼您能談談您在這些市場中看到的情況以及美國與歐洲的利差嗎？謝謝。

Yes. During the first quarter, we had said that we were starting to see some green shoots here in the US where sellers were starting to realize the higher cap rate environment was here to stay. That obviously resulted in an increase in volume in terms of investments here in the US in the second quarter.

是的。在第一季度，我們曾說過，我們開始在美國看到一些萌芽，賣家開始意識到較高的上限利率環境將持續下去。這顯然導致第二季美國投資量增加。

We expect that to continue into the remainder of the year. The volume increase that we saw with regards to sourcing will also attest to that phenomenon. And I think with the backdrop that we are seeing on the cost of capital side, I do think that there will be more transactions that will materialize in the next half, especially here in the US.

我們預計這種情況將持續到今年剩餘時間。我們所看到的採購量的成長也證明了這個現象。我認為，在我們看到資本成本的背景下，我確實認為下半年將會有更多的交易實現，尤其是在美國。

The markets in Europe have been fairly stable. I think the expectations of the interest rate cuts were well understood. And what we saw in the first quarter where we had some opportunistic sellers come to the market and we were the beneficiaries of those transactions, similar transactions took place in the second quarter. And we feel pretty confident that that trend will continue for the remainder of the year. But you should see an increase in volume coming from the US and more of the same in markets outside the US.

歐洲市場一直相當穩定。我認為降息的預期是很好理解的。我們在第一季看到，有一些機會主義賣家進入市場，我們是這些交易的受益者，第二季也發生了類似的交易。我們非常有信心這種趨勢將在今年剩餘時間內持續下去。但您應該會看到來自美國的銷量增加，並且美國以外市場的銷量也有所增加。

Joshua Dennerlein, Bank of America.

約書亞·登納林，美國銀行。

Yes. Hey, guys. Maybe just going back to the Asda loan. I think you've done some other loans in the past that were pretty sizable. Just how do you think about like the duration risk? And just like when you're typically taking the equity stake and doing a real estate loan, it's like you'd assume that real estate forever. But for a loan, it's kind of limited duration. Like how does that factor into your underwriting? Just like is there a limit maybe on exposure you want to have for lending?

是的。嘿，夥計們。也許只是回到阿斯達貸款。我認為您過去也曾辦理過其他一些規模相當大的貸款。您如何看待久期風險？就像當你通常持有股權並進行房地產貸款一樣，就像你會永遠假設房地產一樣。但對於貸款來說，它的期限是有限的。例如這對你的承保有何影響？就像您想要貸款的風險敞口是否有限制一樣？

Yes. So Joshua, we've been very clear with the market that the credit investment side of the business is an addendum to what we are offering our clients. We believe that, opportunistically, it makes a lot of sense for us to continue to be a partner to our clients such as Asda. And when you look at the investment we made, $377 million at an 8.1% six-year paper, and you overlay the fact that we have maturing debt close to GBP600 million coming due in about the same time frame, this is one of the reasons why we did what we did.

是的。約書亞，我們已經向市場明確表示，信貸投資業務是我們為客戶提供的服務的補充。我們相信，從機會角度來看，繼續成為 Asda 等客戶的合作夥伴是很有意義的。當你看看我們所做的投資時，3.77 億美元的六年期票據利率為8.1%，再加上我們還有接近6 億英鎊的到期債務，大約在同一時間範圍內到期，這就是原因之一為什麼我們做了我們所做的事情。

Let me put this in perspective in a slightly different way. If we were to go out and try to do a sale leaseback on Asda Real Estate today, it would probably be in the mid-6s, maybe even in the slightly inside of that. And so for the same credit, if you're able to get 160, 170 basis points of additional spread over a six-year period and get the same exposure in terms of the credit, it's something that for us made a lot of sense.

讓我以稍微不同的方式來看待這個問題。如果我們今天要出去嘗試對阿斯達房地產進行售後回租，價格可能會在 6 年代中期，甚至可能會稍微偏向中間。因此，對於相同的信貸，如果您能夠在六年期間獲得 160、170 個基點的額外利差，並在信貸方面獲得相同的風險敞口，這對我們來說很有意義。

The other reason is one that we've continued to share with the market around why we have gone down this path of credit investments. We've always felt like, okay, we want to be long-term partners to some of our clients. We are willing to do 20-year paper sale leasebacks on their real estate. We are along the credit. We like the credit. And if we can continue to create an even closer relationship by participating higher up on the capital stack, that is something that makes a lot of sense for us.

另一個原因是我們繼續與市場分享我們走這條信貸投資道路的原因。我們一直覺得，好吧，我們希望成為一些客戶的長期合作夥伴。我們願意對他們的房地產進行20年的票據售後回租。我們是信用的。我們喜歡信用。如果我們能夠透過參與更高的資本堆疊來繼續建立更密切的關係，這對我們來說很有意義。

Especially when you take it in the context of we are experiencing the negative impact of higher interest rate environment on our own balance sheet. And if we can offset using this credit investment as a tool, this negative impact that we experienced, by participating on the asset side, by providing credit to some of our clients, then this is a very nice way to hedge this negative impact.

尤其是當你考慮到我們正在經歷高利率環境對我們自己的資產負債表的負面影響時。如果我們可以使用這種信貸投資作為工具，透過參與資產方面，透過向我們的一些客戶提供信貸來抵消我們所經歷的這種負面影響，那麼這是對沖這種負面影響的一個非常好的方法。

Having said all of this, we've also been very clear that credit investment is going to be a point in time. This is not a tool that will work in every environment, and we don't expect to do credit investments in a very low interest rate environment. And so for all of the reasons that I've just enumerated, it's a wonderful tool to have. And thankfully, we have the relationships with clients who want us to participate, we would like to participate. And it acts as a natural hedge to some of the negative headwinds that we encounter in this environment. So that's why we did what we did.

說了這麼多，我們也非常清楚，信貸投資將是一個時間點。這不是一個適用於所有環境的工具，我們也不期望在非常低的利率環境下進行信貸投資。因此，出於我剛才列舉的所有原因，它是一個很棒的工具。值得慶幸的是，我們與希望我們參與的客戶建立了關係，我們也願意參與。它可以作為我們在這種環境中遇到的一些負面阻力的自然對沖。這就是我們這樣做的原因。

Okay. And then maybe just one other question. Just you mentioned the expansion into data centers and gaming. It helps drive internal growth by going into those verticals. I guess are there any other verticals you're looking at, or where you think you can get that higher internal growth rate if you're already in that vertical?

好的。然後也許只是另一個問題。剛才您提到了向資料中心和遊戲領域的擴張。它透過進入這些垂直領域來幫助推動內部成長。我想您是否正在考慮其他垂直領域，或者如果您已經進入該垂直領域，您認為可以在哪些領域獲得更高的內部成長率？

Yes. So the areas that give us that higher internal growth largely are the two you've mentioned and the international market. And obviously, this is not a new vertical for us, but industrial does tend to have higher internal growth as well. And the combination of our investments in these areas have resulted in the profile of internal growth changing from circa 1% in our business to 1.5%. And that will continue to be the areas that we focus in in the future.

是的。因此，為我們帶來更高內部成長的領域主要是你提到的兩個領域和國際市場。顯然，這對我們來說並不是一個新的垂直領域，但工業確實往往也有更高的內部成長。我們在這些領域的投資相結合，導致我們業務的內部成長從約 1% 變為 1.5%。這將繼續是我們未來關注的領域。

I think this was a question that was asked in the previous call as well. Are there any new verticals that we are looking at? And the answer is no. We have a very well-defined total addressable market based on the verticals that we've already articulated to the market. And we are very comfortable continuing to play in those specified verticals. And there's plenty to be done, so we're very happy with that.

我認為這也是在上次通話中提出的問題。我們正在尋找新的垂直領域嗎？答案是否定的。基於我們已經向市場闡明的垂直領域，我們擁有一個非常明確的整體目標市場。我們非常樂意繼續在這些特定的垂直領域開展業務。還有很多事情要做，所以我們對此感到非常滿意。

John [Kulikowski], Wells Fargo.

約翰[Kulikowski]，富國銀行。

Hi, thank you. So the amount of IG tenants as a percentage of acquisitions was 10%, which I believe is lower since the third quarter of 2017. Maybe how should we think about that and your appetite to move down the risk curve to generate yields here?

你好，謝謝。因此，IG 租戶數量佔收購的百分比為 10%，我認為這是自 2017 年第三季以來的較低水平。

Yes. I don't necessarily agree with the last comment that you made in your question, John. But I'll go ahead and answer this question around investment grade representing 10% of our investments in the second quarter. We've always been very clear with the market when we've said that we don't target investment grade as a criteria for investment. What we are looking for is, are we generating the right yield for the credit risk that we are taking, for the real estate risk that we are taking, et cetera?

是的。約翰，我不一定同意您在問題中所做的最後評論。但我將繼續圍繞投資等級回答這個問題，投資等級占我們第二季投資的 10%。當我們表示我們不以投資等級作為投資標準時，我們一直對市場非常明確。我們要找的是，我們是否為我們所承擔的信用風險、我們所承擔的房地產風險等產生了正確的收益率？

And the actual ratings of the client is a byproduct of being able to underwrite appropriate risk adjusted return profile. And if it so happens that we have clients that are investment grade as a result of that risk adjusted profile that we are targeting, that's great. But it's not something we specifically look for.

客戶的實際評級是能夠承保適當的風險調整報酬率的副產品。如果碰巧我們的客戶因為我們目標的風險調整狀況而達到了投資級別，那就太好了。但這不是我們專門尋找的東西。

Case in point, John, if you look at our portfolio today, there are so many names in our top 20. That just happened to be non-rated. And have they gone through a rating process, they would be investment-grade. Companies like Sainsbury's, Treasury Wine Estate, we have grocers like Public and Trader Joe's that are not rated today and don't constitute an investment-grade bucket for us, but if they were to be rated, they would be. And so the point I'm trying to make is it's not something that we target. It's a byproduct of our underwriting, and we are very comfortable continuing down that path.

約翰，如果你看看我們今天的投資組合，你會發現，在我們的前 20 名中，有很多名字。如果他們經過了評級過程，他們將是投資等級的。像Sainsbury's、Treasury Wine Estate 這樣的公司，我們還有像Public 和Trader Joe's 這樣的雜貨店，它們今天沒有被評級，也不構成我們的投資級類別，但如果它們要被評級，它們就會被評級。所以我想說的是，這不是我們的目標。這是我們承保的副產品，我們很樂意繼續沿著這條路走下去。

Understood. And then I guess maybe jumping to bad debt here. On the last call, you mentioned the conservative nature of your bad debt number. I don't believe you provided it, but maybe could you talk about where it is today and if there's upside to your guide here?

明白了。然後我想可能會在這裡陷入壞帳。在上次通話中，您提到了壞帳數字的保守性。我不相信你提供了它，但也許你能談談它今天在哪裡以及你的指南是否有好處？

Yes. So if you just look at what we disclosed in the footnotes of the income statement on the earnings press release or the supplement, you'll see that we've recognized around $9 million on a year-to-date basis in bad debt expense. And so looking at that as a percentage of revenue, it is around 70 basis points or so.

是的。因此，如果你看看我們在收益新聞稿或補充資料中損益表腳註中披露的內容，你會發現我們年初至今已確認了約 900 萬美元的壞帳費用。因此，以佔收入的百分比來看，約為 70 個基點左右。

Now what we've always said is that, historically, we've been roughly in the 35 basis point range as a percentage of revenue to bad debt expense. And when you strip out the pandemic, it's closer to 23 basis points. So we're a little bit ahead of that, but a lot of that was related to this $6 million reserve that we did and up taking on one C-store operator.

現在我們一直說的是，從歷史上看，我們的收入佔壞帳費用的百分比大約在 35 個基點的範圍內。如果剔除大流行病，則接近 23 個基點。所以我們有點領先，但其中很大一部分與我們所做的 600 萬美元準備金以及與便利商店營運商的合作有關。

We do not expect the magnitude of that to carry forward into the back half of the year. But there is still a little bit of conservatism there. And I think from our standpoint, even though we feel very good about a lot of these credits, I think in the back half of the year, you can assume that we're assuming something close to what we recognized in the first half.

我們預計這種情況不會持續到今年下半年。但那裡仍然存在一點保守主義。我認為，從我們的角度來看，儘管我們對其中許多功勞感覺非常好，但我認為在今年下半年，你可以假設我們的假設與我們在上半年所認識到的情況很接近。

Haendel St. Juste, Mizuho.

亨德爾‧聖朱斯特，瑞穗。

Hey, I guess first question, just a follow-up on the Asda loan. I guess, are there any purchase options or agreements attached to the loans? And I guess I'm assuming these are assets you wouldn't mind owning at some point. And then as part of that, I guess I just want to confirm, based on your comments in the call, that we should not anticipate you doing more loan deals in the second half of the year that there's nothing else from that type of activity embedded in the guide? Thanks.

嘿，我想第一個問題是阿斯達貸款的後續問題。我想，貸款是否有任何購買選擇或協議？我想我假設這些是你在某些時候不會介意擁有的資產。然後，作為其中的一部分，我想我只是想根據您在電話中的評論確認，我們不應該預期您在下半年會進行更多貸款交易，因為此類活動沒有任何其他嵌入內容在指南中？謝謝。

So Haendel, yes, the last comment you made is accurate. We are not anticipating doing any credit investments in the second half. But just to be very clear, credit investments is something that we have used opportunistically in the past, and we will continue to use opportunistically going forward. But it is not contemplated that we will do any in the second half.

所以亨德爾，是的，你最後的評論是準確的。我們預計下半年不會進行任何信貸投資。但需要非常明確的是，信貸投資是我們過去投機性使用的東西，未來我們將繼續投機性使用。但我們預計下半年不會採取任何行動。

Having said that, you're right, this is a secured bond offering. And so it is -- the security that we have is obviously a lot of the unencumbered real estate that as continues to own. You're also correct in assuming that we are very comfortable going along the credit. You might recall in the third quarter of last year, we did a fairly large -- I want to say, norther $600 million of sale leaseback with Asda. So this is a credit that we are very comfortable with.

話雖如此，你是對的，這是有擔保的債券發行。事實就是如此——我們所擁有的安全感顯然來自於我們繼續擁有的大量未受限制的房地產。您認為我們很樂意接受信用的假設也是正確的。你可能還記得去年第三季度，我們與阿斯達進行了一項相當大的——我想說的是，北方 6 億美元的售後回租。所以這是我們非常滿意的信用。

We like the operator. We like what they're trying to do with their business. And this is a way for us to continue to strengthen that relationship going forward. But yes, part of what we are trying to do is in the event they decide to go down the path of doing sales leasebacks, we're going to be first in line. There are no guarantees, but we will be first in line for those conversations. And that's exactly the type of position we would like to be going forward with clients such as this.

我們喜歡接線生。我們喜歡他們在業務上所做的努力。這是我們未來繼續加強這種關係的一種方式。但是，是的，我們正在嘗試做的一部分是，如果他們決定走銷售回租的道路，我們將成為第一個。雖然不能保證，但我們將率先參與這些對話。這正是我們希望與這樣的客戶合作的職位類型。

Got it. Got it. Helpful. Thank you for that, and one more, if I may. I was intrigued by your comments on the investing landscape today.

知道了。知道了。有幫助。謝謝你，如果可以的話，我還要再說一次。我對您今天對投資前景的評論很感興趣。

It sounds like you're seeing more opportunities to fit your buyback given your improved cost of capital, and that seems like you're willing to be more active if the right opportunities present themselves. But I guess I'm curious if the lower cost of debt and just improving cost of capital more broadly is perhaps allowing some private competition to rent to the space. So I'm curious if you're seeing any incrementally new competitors or private equity reentering the landscape here?

鑑於您的資本成本有所提高，聽起來您似乎看到了更多適合回購的機會，如果出現合適的機會，您似乎願意更加積極地行動。但我想我很好奇，較低的債務成本和更廣泛的資本成本的改善是否可能允許一些私人競爭者租用該空間。所以我很好奇您是否看到任何逐漸出現的新競爭對手或私募股權重新進入這裡？

Sure. Good question, Haendel. Look, I think it's a little too early, but the reality is that in the event that interest rates do start to come down, private equity that has largely been absent from the market should start to come back in. We are not currently seeing that in the transaction that we are pursuing. We are seeing some institutional capital, and market becoming a bit more aggressive. But it's not prevalent yet.

當然。好問題，韓德爾。聽著，我認為現在有點太早了，但現實是，如果利率確實開始下降，市場上基本上缺席的私募股權應該開始回歸。我們看到一些機構資本和市場變得更加激進。但它還沒有流行。

But yes, if the interest rate environment continues to be positive, i.e., rate cuts start to materialize, finding private equity as a competitor is certainly something that we should expect. You talked about us becoming more aggressive given our cost of capital having improved, especially over the last couple of weeks. That is true. And our cost of capital has improved.

但是，是的，如果利率環境繼續積極，即降息開始具體化，那麼尋找私募股權作為競爭對手肯定是我們應該期待的事情。您談到，鑑於我們的資本成本有所改善，特別是在過去幾週，我們變得更加積極進取。確實如此。我們的資本成本有所改善。

But the point I want to keep making, Haendel, is we want to remain very disciplined. We do believe that there will be more transactions that should take place just given the backdrop that we've talked about. But we don't have to do a whole lot to generate the earnings guidance that we've shared with the market. And if the market opportunistically produces transaction for us, that we feel like makes a lot of sense for our portfolio, we will absolutely be first in line to take advantage of that. And that's the position that we want to be in.

但亨德爾，我想繼續強調的一點是，我們希望保持非常自律。我們確實相信，鑑於我們所討論的背景，應該會發生更多交易。但我們不需要做太多事情來制定我們與市場分享的獲利指引。如果市場機會主義地為我們產生交易，我們認為這對我們的投資組合很有意義，我們絕對會第一個利用這一點。這就是我們想要處於的位置。

But I don't think the fact that our cost of capital has improved, that's going to be the impetus to go out there and start doing more transactions.

但我不認為我們的資本成本有所改善這一事實將成為我們走出去並開始進行更多交易的動力。

I think the materialization of actual transactions that we would like to be successful pursuing that is going to drive what we do in the second half. And we feel based on everything that we are seeing, plus the pipeline that we have, very confident that the investment market will continue to improve.

我認為我們希望成功實現的實際交易的實現將推動我們下半年的工作。根據我們所看到的一切以及我們擁有的管道，我們對投資市場將繼續改善充滿信心。

Smedes Rose, Citi.

斯梅德斯·羅斯，花旗銀行。

Hi, thanks. Just on that, I was just wondering about the transaction activity that you had in your pipeline. I mean -- do you see more larger portfolio deals in the offering? Or is it more smaller one-off transaction opportunities, just insert changes since your last quarterly call?

你好，謝謝。就此而言，我只是想知道您管道中的交易活動。我的意思是—您是否在此次發行中看到了更多規模更大的投資組合交易？或者是更小的一次性交易機會，只需插入自上次季度電話會議以來的更改？

Smedes, there are some large front actions that will be coming to market in the second half. These are existing clients that we have that we are in constant conversations with as to whether we are lucky enough to win those transactions or whether they actually end up coming to market is still a bit of a question mark. But we are starting to see those types of conversations taking place, and we feel pretty good that the market is going to improve. Our pipeline is largely along the lines of what we've achieved to date on the straight up organic acquisition side.

Smedes，有一些大型前線行動將在下半年上市。這些是我們現有的客戶，我們不斷地與他們對話，以確定我們是否足夠幸運贏得這些交易，或者他們是否真的最終進入市場仍然是一個問號。但我們開始看到這些類型的對話正在發生，我們對市場將會改善感到非常滿意。我們的管道很大程度上與我們迄今為止在直接有機收購方面取得的成就一致。

And there aren't any $1 billion portfolio. So that's what you're thinking that we have in our pipeline yet. But the conversation leads me to believe that there will be larger portfolios coming down, but we'll see.

而且沒有任何 10 億美元的投資組合。這就是您所認為的我們正在開發的產品。但這場對話讓我相信將會有更大的投資組合出現，但我們拭目以待。

Okay. Okay. And then I just wanted to ask you, too, I'm sorry if you maybe address this, but the termination fees you received in the quarter, they were related to one particular client or with a bunch of fees that happen to cut it at once. So just wondering what they were related to?

好的。好的。然後我也想問你，如果你能解決這個問題，我很抱歉，但是你在本季度收到的終止費，它們與一個特定客戶有關，或者與一系列費用有關，這些費用恰好在一次。所以只是想知道它們與什麼有關？

Yes, Smedes those related to one particular tenant. And it's really reflective of an agreement that our team will be able to reach with them for a handful of assets, not the entire exposure, but just a handful.

是的，斯梅德斯那些與某一特定租戶有關的人。這確實反映了我們的團隊將能夠與他們就少數資產達成的協議，而不是全部資產，而只是少數資產。

Greg McGinniss, Scotiabank.

格雷格·麥金尼斯，豐業銀行。

I hope you're doing well. I was just hoping to get a little more color on how you're identifying assets for disposition, whether that's tenant credit, renewal risk, geography? Any color would be appreciated.

我希望你一切都好。我只是希望對如何識別要處置的資產有更多了解，是否是租戶信用、續約風險、地理位置？任何顏色都會受到讚賞。

Sure, Greg. So a lot of it is very -- it's opportunistic. It is an analysis, a very deep analysis that the asset management team takes on looking at assets for existing clients that may not have the right return profile that longer term because the markets have changed, or that particular location is not what it used to be. There could be several reasons as to why they get into the disposition list, one of which could be credit as well.

當然，格雷格。所以很多都是非常——這是機會主義的。這是一種分析，一種非常深入的分析，資產管理團隊會為現有客戶尋找資產，這些客戶可能不會在長期內獲得正確的回報，因為市場已經發生變化，或者特定位置已不再是以前的樣子。他們進入處置名單可能有多種原因，其中之一也可能是信用。

And so we are using our predictive analytic tools to help monitor these 15,000 assets that we have at any given point in time. And it's coming out with a rating that then suggests that, hey, this one may have a high location risk or low fungibility available to these locations. And then we overlay the credit on top of that. And then asset management goes through those and tries to create various different areas of what is the economic outcome going to look like under, for instance, a client that may not have any credit issues will pay rent.

因此，我們使用預測分析工具來幫助監控我們在任何給定時間點擁有的 15,000 項資產。它給出的評級表明，嘿，這個位置可能具有較高的位置風險或這些位置的可替代性較低。然後我們將信用疊加在上面。然後資產管理會仔細研究這些內容，並嘗試創建各種不同領域的經濟結果，例如，可能沒有任何信用問題的客戶將支付租金。

But at the end, this asset may not have other alternatives available to it outside of a vacant sale. And that return profile will be compared with selling it today to see what yields a better outcome. And that's the analysis that the asset management team is undertaking far more directly today than I think we've done in the past and that's the reason why we've come up with the $400 million to $500 million of assets that we feel like does not necessarily have a long-term future in our portfolio. And that's how we come up with the list.

但最終，除了空置出售之外，該資產可能沒有其他選擇。我們將把該回報率與今天出售的回報率進行比較，看看什麼會產生更好的結果。這就是資產管理團隊今天所做的分析，比我認為我們過去所做的要直接得多，這就是為什麼我們提出了 4 億至 5 億美元的資產，而我們認為這些資產並不存在。的投資組合中必然有長期的未來。這就是我們列出清單的方式。

Okay. And then on acquisitions, how should we be thinking about your view on investment spread with the improved cost of capital versus what you're actually seeing in the market. The US cap rates were up 70 basis points quarter-over-quarter. Is that a fair target area? Or could we see that start to come back in?

好的。然後在收購方面，我們應該如何考慮您對資本成本改善的投資利差與您在市場上實際看到的情況的看法。美國上限利率較上月上升 70 個基點。那是一個公平的目標區域嗎？或者我們可以看到這種情況開始回歸嗎？

Greg, as you know, I think I don't see the cap rates moving out from these levels. And in fact, they probably are going to start to come in going forward just given the backdrop that we are all experiencing with better cost of capital, more competitors are going to start to come in. It's going to put pressure on the cap rates. But in terms of spread, which is how we think of our business, we are very hopeful of maintaining the spreads that we've achieved thus far. And it could be a combination of our improving cost of capital despite perhaps a slightly lower cap rate environment.

格雷格，如你所知，我認為我認為資本化率不會脫離這些水準。事實上，考慮到我們都在經歷更好的資本成本，更多的競爭對手將開始進入，他們可能會開始進入。但就利差而言，這就是我們對我們業務的看法，我們非常希望維持迄今為止所實現的利差。這可能是由於我們的資本成本不斷提高，儘管資本化率環境可能略低。

But we are going to be very selective in what it is that we pursue, which is why we have not gone out and increased our acquisition guidance. But let's wait and see what happens over the next couple of months. Things are fairly volatile with elections coming up later this year. And obviously, we see what's happening on the geopolitical side. So it is a bit of a volatile period. But having filtered all of that, I think you should expect to see us trying to maintain the spreads that we've achieved thus far.

但我們將對我們追求的目標非常有選擇性，這就是為什麼我們沒有出去增加我們的收購指導。但讓我們拭目以待，看看接下來的幾個月會發生什麼。今年稍後將舉行選舉，情況相當不穩定。顯然，我們看到了地緣政治方面正在發生的事情。所以這是一個有點不穩定的時期。但在過濾了所有這些之後，我認為您應該期望看到我們試圖維持迄今為止所實現的利差。

Upal Rana, KeyBanc Capital Markets.

Upal Rana，KeyBanc 資本市場。

Sumit, you touched on dispositions already, but I wanted to get your reasoning on providing guidance at this point? And is this a product of better visibility or a shift in strategy you did mention that you do impact -- expect to be more active on that front than the past. So you have sold a number of vacant properties already this year, but you still have another 185 more to go. So I want to get any color on that, that would be helpful.

Sumit，您已經談到了處置，但我想聽聽您此時提供指導的推理？這是一個具有更好可見性的產品，還是您確實提到的策略轉變，您確實產生了影響——預計在這方面會比過去更加積極。今年您已經出售了一些空置房產，但還有 185 處待出售。所以我想在上面得到任何顏色，這會很有幫助。

Yes. Good question, Upal. You should expect the -- at the end of it all, half of it to be occupied assets and half of it to be vacant assets. So clearly, the trend for the first half has been more vacant asset sales. So that's going to shift going forward.

是的。好問題，烏帕爾。您應該預料到，最終，一半是佔用資產，一半是空置資產。很明顯，上半年的趨勢是更多的空置資產出售。因此，這種情況將會改變。

It is a slight shift in our strategy, but not if it is driven by two very large M&A deals that we've effectuated over the last 2.5 years. And clearly, and we've been very upfront about this. There are assets that we've inherited that it's not a long-term strategic hold for us. And so we just want to be more proactive in being able to dispose of these assets. And given the quantum of capital that this particular process can generate for i.e., $400 million to $500 million, we wanted to be very clear with the market that look, this is going to be a source of capital for us that you may or may not be aware of.

這是我們策略上的一個微小轉變，但如果它是由我們在過去 2.5 年中完成的兩筆非常大的併購交易推動的，那就不是這樣了。顯然，我們對此非常坦率。我們繼承了一些資產，但這對我們來說並不是長期策略持有。因此，我們只是想更主動地處置這些資產。考慮到這個特定流程可以產生的資本量，即 4 億至 5 億美元，我們希望非常清楚地了解市場，這將成為我們的資本來源，您可能會也可能不會知道。

And so people can appropriately underwrite that source of capital. And when we make statements like we don't have to be out in the equity market, this helps explain that piece. But the strategic rationale is always are constant vigilance on what is it that our portfolio looks like? Where has our strategic shifts occurred given everything that we are seeing and being a lot more proactive on the disposition side than we had traditionally been.

因此人們可以適當地承保該資本來源。當我們發表聲明說我們不必進入股市時，這有助於解釋這一點。但戰略理由始終是對我們的投資組合是什麼樣子保持警覺？考慮到我們所看到的一切，我們的策略轉變發生在哪裡，並且在處置方面比我們傳統上更加積極主動。

Okay. Great. That was helpful. And then you mentioned in your prepared remarks about the transaction market moving towards normalization. What did you mean by that?

好的。偉大的。這很有幫助。然後您在準備好的發言中提到了交易市場正在走向正常化。你這是什麼意思？

Did you mean in terms of volume, cap rates investment spreads, seller sentiment, competition? Maybe if you can give more any detail on that, that would be helpful.

您指的是數量、資本化率、投資利差、賣家情緒、競爭嗎？也許如果您能提供更多相關細節，那會很有幫助。

Sure. So obviously, a lot of sellers were on the sideline hoping for cap rates to move, we've always talked about the cost of capital is a mark-to-market variable that's essentially getting marked every second, but cap rates tend to be stickier. And when the cost of capital changed as abruptly as it did for a lot of the REIT sector, the sellers were not able to accept that environment. And so they were waiting on the sidelines, expecting things to change, but sellers can't wait indefinitely.

當然。顯然，許多賣家都在觀望，希望資本化率能夠改變，我們一直在談論資本成本是一個按市值計價的變量，基本上每秒都會被標記，但資本化率往往更具黏性。當資本成本像許多房地產投資信託基金產業一樣突然變化時，賣家無法接受這種環境。因此，他們在場邊等待，期待事情會發生變化，但賣家不能無限期地等待。

And we've seen that phenomenon play out in the international markets more so than here. And -- but -- and so when that happens, sellers start to creep back into the market after a period of time. And the added element that's taking place is there's a little bit more clarity today, and I say that, and I smile as to where the interest rates are going to go. And so obviously, the cost of capital side of the equation has changed for a lot of the REITs. And so this is going to allow them to transact on transactions on assets that they would have looked at doing had their cost of capital being better. And so I think it's a movement on the buyer side.

我們已經看到這種現像在國際市場上比在這裡更常見。但是，當這種情況發生時，賣家在一段時間後開始重返市場。正在發生的額外因素是今天更加清晰了，我這麼說，並對利率將走向何方微笑。顯然，許多房地產投資信託基金的資本成本方面已經發生了變化。因此，這將允許他們進行資產交易，如果資本成本更好的話，他們會考慮這樣做。所以我認為這是買方方面的運動。

It's going to be a movement on the seller side. And that's what I mean that this should facilitate more transactions in the second half than it has in the first half.

這將是賣方方面的一場運動。這就是我的意思，這應該會促進下半年比上半年更多的交易。

Linda Tsai, Jefferies.

琳達·蔡，杰弗里斯。

The 1% of same-store revenue growth you're achieving this year. What does it look like for next year if your portfolio stabilized internal growth rate is 1.5% on an annualized basis?

您今年實現的同店營收成長 1%。如果您的投資組合穩定的年化內部成長率為 1.5%，明年會是什麼樣子？

Yes. So Linda, first of all, there's some moving pieces with this year's guidance of approximately 1% on same store. It's a difficult year-over-year comp because we did have some reserve reversals and deferment payments that we realized last year. Last year, we had 1.9% was our same-store number. This year at 2%, you're averaging -- this year at 1%, excuse me, you're averaging outside 1.5 or so level.

是的。 Linda，首先，有一些變動，今年的指導是同一家商店的銷售額約為 1%。這是一個困難的同比比較，因為我們去年確實實現了一些準備金沖銷和延期付款。去年，我們的同店銷售額為 1.9%。今年你的平均成長率是 2%，今年是 1%，對不起，你的平均成長率超出了 1.5 左右的水準。

And so next year, there should be an easing of the difficult comps, but what we've always been framing for investors, especially more recently is that we are around 1.5% on a contractual rent basis, growth basis. And we would expect that to continue next year and beyond.

因此，明年，困難的比較應該會有所緩解，但我們一直為投資者制定的框架，尤其是最近，我們在合約租金基礎上和增長基礎上的利率約為 1.5%。我們預計這種情況將在明年及以後繼續下去。

And then assuming an 84% recapture rate through year-end 2016, you only have 37 bps or $0.02 of AFFO per share impact at risk. Could that mean that your bad debt outlook in '25 is stable or even less than what we saw this year?

然後假設到 2016 年底的回收率為 84%，那麼您只有 37 個基點或每股 AFFO 0.02 美元的影響面臨風險。這是否意味著你們 25 年的壞帳前景是穩定的，甚至低於我們今年看到的情況？

Linda, the way to think about bad debt is we start the year expecting a certain percentage of bad debt expense. And in certain years, we either meet bills in a lot of years, we beat them. And in certain other years like the pandemic year, it goes beyond what we had originally gone into the year with. I think this is one of those -- like last year, for instance, we were -- we had positive outcomes on what our initial expectation was, which was, I think, 40, 50 basis points of rent. And all of last year, we not only did not have any bad debt expense, we actually ended up collecting on rents that we had on cash accounting.

琳達，考慮壞帳的方法是我們在新年伊始就預期壞帳費用會達到一定比例。在某些年份，我們要么在很多年裡滿足賬單，要么擊敗它們。在某些其他年份，例如大流行年，它超出了我們最初進入的年份。我認為這是其中之一 - 例如去年，我們對我們最初的預期取得了積極的成果，我認為是 40、50 個基點的租金。去年全年，我們不僅沒有任何壞帳費用，實際上我們最終還收取了現金會計的租金。

So that was a positive outcome. This year, this seems to be trending more in line with what we had anticipated at the beginning of the year. And there is some potential upside, but we are not -- we've still got five months left, and we'll see how things play out. But traditionally, it's been right around that 23% absent the pandemic year. And inclusive of the pandemic year, it's been right around 37% -- 37 basis points, sorry, 37 basis points of rent that has basically been bad debt expense.

所以這是一個正面的結果。今年，這一趨勢似乎更符合我們年初的預期。還有一些潛在的好處，但我們沒有——我們還有五個月的時間，我們會看看事情會如何發展。但傳統上，如果沒有疫情爆發的年份，這個數字剛好是 23% 左右。包括大流行年份在內，這一比例約為 37%——37 個基點，抱歉，37 個基點的租金基本上是壞帳費用。

So do we expect 2025 to be similar, yes. But we generally don't talk about years well in advance, which is why I'm pointing to what historically has happened at Realty Income.

那我們預期 2025 年也會類似嗎？但我們通常不會提前談論幾年，這就是為什麼我要指出房地產收入歷史上發生的事情。

[Alex Fagan], Baird.

[亞歷克斯費根]，貝爾德。

Hi, and thanks for taking my question. Kind of to go back to the C-store client, that litigation. do you have that space back? And is there already a replacement tenant for that asset?

您好，感謝您提出我的問題。有點回到便利商店客戶的訴訟。你還有那個空間嗎？該資產是否已有替代租戶？

We don't, Alex, which is why we are in litigation and -- which is where the upside comes from. So we've essentially that this year is going to be a resolution year. Once we get those assets back, we are very confident in our ability to find alternative clients in the C-store space for those particular locations. So that's where the upside is. And no, we are not expecting to resolve any of that this year.

我們不這樣做，亞歷克斯，這就是我們提起訴訟的原因——這就是好處的來源。因此，我們基本上認為今年將是解決問題的一年。一旦我們拿回這些資產，我們就非常有信心能夠在這些特定地點的便利商店空間中找到替代客戶。這就是好處所在。不，我們預計今年不會解決任何問題。

Got it. That's helpful. And then maybe for Jonathan. What are you thinking about future debt issuances, what currency is currently most attractive? And at what rate can you issue that?

知道了。這很有幫助。然後也許是喬納森。您對未來的債務發行有何看法？你能以什麼利率發行？

Yes. Look, so if we were to sit here today and guess what indicative is might be on 10-year unsecured paper, you're probably looking at the very low 5s, call it 5.1, 5.2 for US dollar and sterling and then you're probably looking at very low 4s, about 100 basis points tighter in the Eurozone. So we always want to have a level of flexibility.

是的。聽著，如果我們今天坐在這裡猜測 10 年期無擔保票據上的指標可能是什麼，您可能會看到非常低的 5，將美元和英鎊稱為 5.1、5.2，然後您就會看到歐元區的利率可能會非常低，大約收緊100 個基點。所以我們總是希望有一定程度的彈性。

I think when you look at how far wide sterling has traded relative to the dollar over the last few years and now that it's back to parity, we have been leaning more towards the dollar side over the last few years. And the optionality is there for us because we do have the currency net investment hedge capacity to be active in the sterling market. But obviously, the more euro deals that we do and transact on, the greater the ability for us to access 4% paper will be.

我認為，當你看看過去幾年英鎊相對於美元的交易幅度有多大，現在又回到了平價，我們在過去幾年裡一直更傾向於美元。我們有選擇權，因為我們確實擁有活躍於英鎊市場的貨幣淨投資對沖能力。但顯然，我們進行的歐元交易越多，我們獲得 4% 票據的能力就越大。

So these are the things that we think about on a daily basis. A lot of it depends on the currency of the assets that we're bringing on the books. But we're glad that we left quite a bit of capacity in these currencies that are starting to trade at parity or even inside of it relative to a dollar.

這些都是我們每天思考的事情。這在很大程度上取決於我們記入帳簿的資產的貨幣。但我們很高興我們在這些貨幣中留下了相當多的容量，這些貨幣開始以與美元的平價甚至在其內部進行交易。

Spenser Allaway, Green Street Advisors.

史賓塞‧阿拉維，格林街顧問公司。

Maybe just one going back to the transaction market. Can you just comment on where you're seeing the largest bid-ask spreads either across property types or industries?

也許只是回到交易市場。您能評論一下您在房地產類型或行業中看到的最大買賣差價嗎？

For the first half of the year spent it was here in the US. That's the reason why our volumes were much lower than what was -- that's what was traditionally seen in what we've done. I think that's starting to compress that bid-ask spread, which is the reason why we feel pretty confident that the markets here in the US is going to start to materialize favorably for us. And yes, so that's what we see.

今年上半年是在美國度過的。這就是為什麼我們的銷量比以前低得多的原因——這就是我們所做的傳統上看到的情況。我認為這開始壓縮買賣價差，這就是為什麼我們對美國市場將開始對我們有利的情況充滿信心的原因。是的，這就是我們所看到的。

Ronald Camden, Morgan Stanley.

羅納德‧卡姆登，摩根士丹利。

Hey, just two quick ones for me. Just one, just on the interest cost. Can you remind us how much of the guidance this year, the FFO growth, how much of it was a drag just from higher interest expense and so forth? And how are you thinking about the maturities in '25?

嘿，給我兩個快速的。只有一個，只是利息成本。您能否提醒我們，今年的指引、FFO 成長有多少，其中有多少是利息支出上升等因素造成的拖累？您如何看待 25 年的到期日？

Yes. So definitely it wasn't much of a drag this year. I mean luckily, for us, we came out and did a debt offering in January and that was in the very low 5s, just above five. So when you look at it on a year-over-year basis, not a big difference. We did obviously have a $350 million bond that we did repay.

是的。所以今年肯定沒有太大的拖累。我的意思是，幸運的是，對我們來說，我們在 1 月推出了債券，發行價格處於非常低的 5 美元左右，略高於 5 美元。因此，當您逐年查看時，並沒有太大差異。顯然我們確實償還了 3.5 億美元的債券。

So there's a little bit of dilution from that. But I think when you look into 2025, we've got $1.8 billion, $1.9 billion, a 4.2% I just talked about how maybe there's 100 basis points of dilution if we were to do something like sterling and dollars based off of today's indicative rates that would have no more than about a 50 basis point impact to earnings.

所以這會帶來一點稀釋。但我認為，當你展望2025 年時，我們有18 億美元、19 億美元、4.2%，我剛才談到，如果我們根據今天的指示性利率採取英鎊和美元之類的措施，可能會出現100個基點的稀釋這對獲利的影響不會超過 50 個基點。

So it's obviously come in quite a bit. But obviously, if we have something from a euro standpoint that we can take advantage of that it will be breakeven for 2025 for short-term borrowings. Yes, it has been a little bit more dilutive because we peaked with the Fed funds rate this year. But I think much better than it was last year where that was close to 2% of growth that was held back solely because of that.

所以它顯然進來了很多。但顯然，如果我們從歐元的角度來看有一些可以利用的東西，那麼短期借款將在 2025 年實現盈虧平衡。是的，它的稀釋作用有點大，因為今年聯邦基金利率達到了頂峰。但我認為比去年好得多，去年接近 2% 的成長僅因此而受到抑制。

Great. And then my second question was just on the new growth verticals specifically, just double clicking on data centers and gaming. Obviously, you've done two great deals with two great partners. But just wondering as you're thinking about the future deal's opportunity, is there any bless and learns any way that you want to structure it differently maybe that you're thinking about as the opportunity gotten more attractive, less attractive? Just trying to get a sense of where we are 12, 24 months into this process?

偉大的。然後我的第二個問題是關於新的成長垂直領域，只需雙擊資料中心和遊戲即可。顯然，您已經與兩個偉大的合作夥伴達成了兩筆偉大的交易。但只是想知道，當您考慮未來交易的機會時，是否有任何祝福和學習您想要以不同的方式構建它，也許您正在考慮隨著機會變得更有吸引力，或更不那麼有吸引力？只是想了解我們在這個過程中 12、24 個月的進展嗎？

Thanks, Ronald. So on the gaming side, just based on performance of the assets that we have visibility into -- it's clearly been a great investment for us. Both the assets that we currently either own 100% or partially owned have continued to perform, and we -- then the leases that were structured were, in our view, very favorable leases. It was a fair lease both to the operator and to us. And I'm not sure if there's anything there that we would change based on what we've learned over the last two years.

謝謝，羅納德。因此，在遊戲方面，僅基於我們所了解的資產的性能，這對我們來說顯然是一項巨大的投資。我們目前擁有 100% 或部分擁有的資產都持續表現良好，而且我們認為當時建立的租賃是非常有利的租賃。這對營運商和我們來說都是公平的租賃。我不確定根據過去兩年的經驗，我們是否會做出任何改變。

On the data center side, we've only got one investment that has now come online. And we are very excited about continuing to work with our partner, our existing partner and some new partners that we are trying to cultivate within this space. Like I've said, the hyperscale business with enterprise clients, it's a massive business and one that I don't think any single or even three, four sources of capital can solve.

在資料中心方面，我們只有一項投資現已上線。我們非常高興能夠繼續與我們的合作夥伴、現有合作夥伴以及我們正在該領域培養的一些新合作夥伴合作。正如我所說，企業客戶的超大規模業務是一項龐大的業務，我認為任何單一甚至三、四個資本來源都無法解決這個問題。

And we believe that this is a total addressable market that has a place for somebody like us partnering with the right developers, operators to create our own portfolio that grows from where we are today. And I don't need to go into the thesis as to the why, but it's fairly new for us to really reflect on lessons learned.

我們相信，這是一個完全可尋址的市場，像我們這樣的人可以與合適的開發商、營運商合作，創建我們自己的產品組合，並從今天的基礎上發展壯大。我不需要在論文中詳細解釋原因，但對我們來說，真正反思所學到的教訓是相當新鮮的。

We are still trying to build that particular pipeline up. And in time, I'm sure we will share lessons learned. But one of the things that we are very focused on. And this is not necessarily based on our own history, but the history of this particular sector is to make sure that the rents that we are underwriting today one are rents that can be supported come to renewal time, even 10, 15 years out. And I think that was one of the lessons that this particular sector had to learn the hard way when they went through renewals, and they were taking write-downs in space.

我們仍在努力建立該特定管道。我確信我們最終會分享經驗教訓。但我們非常關注的事情之一。這不一定是基於我們自己的歷史，但這特定行業的歷史是為了確保我們今天承保的租金是可以在續訂時得到支持的租金，甚至是 10 年、15 年後的租金。我認為這是這個特定行業在經歷續約時必須經歷的慘痛教訓之一，並且他們正在進行太空減記。

But outside of that, make sure that things that can become obsolete are investments that we would want the operator to make. And we stay as close and as true to the real estate as we possibly can. That's really the lens through which we are looking at the data center space.

但除此之外，也要確保那些可能過時的東西是我們希望營運商進行的投資。我們盡可能地貼近和忠於房地產。這確實是我們觀察資料中心空間的鏡頭。

Linda Tsai, Jefferies.

琳達·蔡，杰弗里斯。

Just on the 84% recapture rate. How much does that number move around any given year? And could that actually go down next year if you have a longer run rate for knowing when those closures are going to happen?

就84%的奪回率而言。這個數字在任何一年內變動了多少？如果你有更長的運行時間來了解這些關閉何時發生，那麼明年這個數字實際上會下降嗎？

No. The 84% is our historical average through the bankruptcy process. So any client that goes through a chapter 11 process, and if you compare the emerging rent to the pre-bankruptcy rent, that recapture rate is 84%.

不會。因此，任何經歷第 11 章流程的客戶，如果將新興租金與破產前租金進行比較，則收回率為 84%。

And Linda, if you look at the amplitude within that 84%, if you actually look at individuals, we've had situations where we've collected 70% or 65% of the rent. And then there have been situations where we've collected 100% of the rent pre-bankruptcy versus post-bankruptcy. So there is variance around this 84%, but that has historically been what we've achieved. And that's the number that we are sharing with the market.

琳達，如果你看看 84% 內的幅度，如果你實際上看看個人，我們曾經遇到過收取 70% 或 65% 租金的情況。在某些情況下，我們在破產前和破產後收取了 100% 的租金。所以這個 84% 左右有差異，但這就是我們歷史上所取得的成就。這就是我們與市場分享的數字。

This concludes our question-and-answer session. I would like to turn the conference back over to Sumit Roy for closing remarks.

我們的問答環節到此結束。我想將會議轉回蘇米特·羅伊 (Sumit Roy) 致閉幕詞。

Thank you all for joining us today. We look forward to speaking soon and seeing you at conferences in the coming months.

感謝大家今天加入我們。我們期待盡快發言並在未來幾個月的會議上見到您。

The conference is now -- the conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現在——會議現在結束了。感謝您參加今天的演講。您現在可以斷開連線。