Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 30, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-13374 | |
Entity Registrant Name | REALTY INCOME CORPORATION | |
Entity Central Index Key | 0000726728 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 33-0580106 | |
Entity Address, Address Line One | 11995 El Camino Real | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92130 | |
City Area Code | 858 | |
Local Phone Number | 284-5000 | |
Title of 12(b) Security | Common Stock, $0.01 Par Value | |
Trading Symbol | O | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 343,416,057 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Real estate held for investment, at cost: | ||
Land | $ 5,742,023 | $ 5,684,034 |
Buildings and improvements | 14,070,733 | 13,833,882 |
Total real estate held for investment, at cost | 19,812,756 | 19,517,916 |
Less accumulated depreciation and amortization | (3,242,175) | (3,117,919) |
Real estate held for investment, net | 16,570,581 | 16,399,997 |
Real estate and lease intangibles held for sale, net | 21,356 | 96,775 |
Cash and cash equivalents | 41,804 | 54,011 |
Accounts receivable | 185,632 | 181,969 |
Lease intangible assets, net | 1,516,819 | 1,493,383 |
Other assets, net | 460,250 | 328,661 |
Total assets | 18,796,442 | 18,554,796 |
LIABILITIES AND EQUITY | ||
Distributions payable | 80,911 | 76,728 |
Accounts payable and accrued expenses | 182,177 | 177,039 |
Lease intangible liabilities, net | 328,748 | 333,103 |
Other liabilities | 251,353 | 262,221 |
Line of credit payable | 615,176 | 704,335 |
Term loans, net | 499,151 | 499,044 |
Mortgages payable, net | 408,158 | 410,119 |
Notes payable, net | 6,013,129 | 6,288,049 |
Total liabilities | 8,378,803 | 8,750,638 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Common stock and paid in capital, par value $0.01 per share, 740,200,000 shares authorized, 343,402,030 and 333,619,106 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively | 13,604,055 | 12,873,849 |
Distributions in excess of net income | (3,173,468) | (3,082,291) |
Accumulated other comprehensive loss | (42,572) | (17,102) |
Total stockholders’ equity | 10,388,015 | 9,774,456 |
Noncontrolling interests | 29,624 | 29,702 |
Total equity | 10,417,639 | 9,804,158 |
Total liabilities and equity | $ 18,796,442 | $ 18,554,796 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock and paid in capital, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock and paid in capital, authorized (in shares) | 740,200,000 | 740,200,000 |
Common stock and paid in capital, issued (in shares) | 343,402,030 | 333,619,106 |
Common stock and paid in capital, outstanding (in shares) | 343,402,030 | 333,619,106 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
REVENUE | ||
Rental (including reimbursable) | $ 412,157 | $ 354,037 |
Other | 2,184 | 328 |
Total revenue | 414,341 | 354,365 |
EXPENSES | ||
Depreciation and amortization | 164,585 | 137,517 |
Interest | 75,925 | 70,020 |
Property (including reimbursable) | 25,606 | 21,636 |
General and administrative | 20,964 | 15,108 |
Income taxes | 2,763 | 1,445 |
Provisions for impairment | 4,478 | 4,672 |
Total expenses | 294,321 | 250,398 |
Gain on sales of real estate | 38,506 | 7,263 |
Foreign currency and derivative losses, net | (1,564) | 0 |
Loss on extinguishment of debt | (9,819) | 0 |
Net income | 147,143 | 111,230 |
Net income attributable to noncontrolling interests | (316) | (288) |
Net income available to common stockholders | $ 146,827 | $ 110,942 |
Amounts available to common stockholders per common share: | ||
Net income, basic and diluted (in dollars per share) | $ 0.44 | $ 0.37 |
Weighted average common shares outstanding: | ||
Basic (in shares) | 336,624,567 | 303,528,336 |
Diluted (in shares) | 336,976,515 | 303,819,878 |
Other comprehensive income: | ||
Net income available to common stockholders | $ 146,827 | $ 110,942 |
Foreign currency translation adjustment | 392 | 0 |
Unrealized loss on derivatives, net | (25,862) | (3,699) |
Comprehensive income available to common stockholders | $ 121,357 | $ 107,243 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total | Total stockholders’ equity | Shares of common stock | Common stock and paid in capital | Distributions in excess of net income | Accumulated other comprehensive loss | Noncontrolling interests |
Balance at Dec. 31, 2018 | $ 8,120,978 | $ 8,088,742 | $ 10,754,495 | $ (2,657,655) | $ (8,098) | $ 32,236 | |
Balance (in shares) at Dec. 31, 2018 | 303,742,090 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 111,230 | 110,942 | 110,942 | 288 | |||
Other comprehensive loss | (3,699) | (3,699) | (3,699) | ||||
Distributions paid and payable | (206,335) | (206,062) | (206,062) | (273) | |||
Share issuances, net of costs | 2,151 | 2,151 | 2,151 | ||||
Share issuances, net of costs (in shares) | 31,898 | ||||||
Issuance of common partnership units | 6,286 | 6,286 | |||||
Redemption of common units | (20,225) | (6,869) | (6,869) | (13,356) | |||
Share-based compensation, net | (1,310) | (1,310) | (1,310) | ||||
Share-based compensation, net (in shares) | 33,433 | ||||||
Balance at Mar. 31, 2019 | 8,009,076 | 7,983,895 | 10,748,467 | (2,752,775) | (11,797) | 25,181 | |
Balance (in shares) at Mar. 31, 2019 | 303,807,421 | ||||||
Balance at Dec. 31, 2019 | 9,804,158 | 9,774,456 | 12,873,849 | (3,082,291) | (17,102) | 29,702 | |
Balance (in shares) at Dec. 31, 2019 | 333,619,106 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 147,143 | 146,827 | 146,827 | 316 | |||
Other comprehensive loss | (25,470) | (25,470) | (25,470) | ||||
Distributions paid and payable | (238,398) | (238,004) | (238,004) | (394) | |||
Share issuances, net of costs | 730,776 | 730,776 | 730,776 | ||||
Share issuances, net of costs (in shares) | 9,724,500 | ||||||
Share-based compensation, net | (570) | (570) | (570) | ||||
Share-based compensation, net (in shares) | 58,424 | ||||||
Balance at Mar. 31, 2020 | $ 10,417,639 | $ 10,388,015 | $ 13,604,055 | $ (3,173,468) | $ (42,572) | $ 29,624 | |
Balance (in shares) at Mar. 31, 2020 | 343,402,030 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 147,143 | $ 111,230 |
Adjustments to net income: | ||
Depreciation and amortization | 164,585 | 137,517 |
Amortization of share-based compensation | 5,518 | 2,764 |
Non-cash revenue adjustments | (1,352) | (2,116) |
Loss on extinguishment of debt | 9,819 | 0 |
Amortization of net premiums on mortgages payable | (354) | (354) |
Amortization of deferred financing costs | 2,581 | 1,957 |
Loss on interest rate swaps | 686 | 678 |
Foreign currency and derivative losses, net | 1,564 | 0 |
Gain on sales of real estate | (38,506) | (7,263) |
Provisions for impairment on real estate | 4,478 | 4,672 |
Change in assets and liabilities | ||
Accounts receivable and other assets | 3,005 | (6,185) |
Accounts payable, accrued expenses and other liabilities | (33,951) | (30,873) |
Net cash provided by operating activities | 265,216 | 212,027 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Investment in real estate | (473,245) | (517,975) |
Improvements to real estate, including leasing costs | (3,658) | (2,995) |
Proceeds from sales of real estate | 126,233 | 22,456 |
Insurance and other proceeds received | 539 | 0 |
Non-refundable escrow deposits | (1,280) | 0 |
Net cash used in investing activities | (351,411) | (498,514) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Cash distributions to common stockholders | (233,824) | (204,546) |
Borrowings on line of credit | 846,532 | 732,000 |
Payments on line of credit | (921,859) | (146,000) |
Principal payment on term loan | 0 | (70,000) |
Principal payment on notes payable | (250,000) | 0 |
Principal payments on mortgages payable | (1,673) | (1,235) |
Payments upon extinguishment of debt | (9,445) | 0 |
Proceeds from common stock offerings, net | 728,883 | 0 |
Proceeds from dividend reinvestment and stock purchase plan | 2,366 | 2,164 |
Redemption of common units | 0 | (20,225) |
Distributions to noncontrolling interests | (394) | (321) |
Net receipts on derivative settlements | 1,251 | 0 |
Other items, including shares withheld upon vesting | (6,561) | (4,087) |
Net cash provided by financing activities | 155,276 | 287,750 |
Effect of exchange rate changes on cash and cash equivalents | (2,929) | 0 |
Net increase in cash, cash equivalents and restricted cash | 66,152 | 1,263 |
Cash, cash equivalents and restricted cash, beginning of period | 71,005 | 21,071 |
Cash, cash equivalents and restricted cash, end of period | $ 137,157 | $ 22,334 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements of Realty Income Corporation (“Realty Income”, the “Company”, “we”, “our” or “us”) were prepared from our books and records without audit and include all adjustments (consisting of only normal recurring accruals) necessary to present a fair statement of results for the interim periods presented. Readers of this quarterly report should refer to our audited consolidated financial statements for the year ended December 31, 2019 , which are included in our 2019 Annual Report on Form 10-K, as certain disclosures that would substantially duplicate those contained in the audited financial statements have not been included in this report. Unless otherwise indicated, all dollar amounts are expressed in United States (U.S.) dollars. At March 31, 2020 we owned 6,525 properties, located in 49 U.S. states, Puerto Rico and the United Kingdom (U.K.), consisting of approximately 106.0 million leasable square feet. |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements | Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements A. The accompanying consolidated financial statements include the accounts of Realty Income and other subsidiaries for which we make operating and financial decisions (i.e., control), after elimination of all material intercompany balances and transactions. We consolidate entities that we control and record a noncontrolling interest for the portion that we do not own. Noncontrolling interest that was created or assumed as part of a business combination or asset acquisition was recognized at fair value as of the date of the transaction (see note 10). We have no unconsolidated investments. B. We have elected to be taxed as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended. We believe we have qualified and continue to qualify as a REIT. Under the REIT operating structure, we are permitted to deduct dividends paid to our stockholders in determining our taxable income. Assuming our dividends equal or exceed our taxable net income, we generally will not be required to pay federal corporate income taxes on such income. Accordingly, no provision has been made for federal income taxes in the accompanying consolidated financial statements, except for federal income taxes of our taxable REIT subsidiaries. The income taxes recorded on our consolidated statements of income and comprehensive income represent amounts paid by Realty Income and its subsidiaries for city and state income and franchise taxes and for U.K. income taxes. C. The COVID-19 pandemic and the measures taken to limit its spread are negatively impacting the economy across many industries, including the industries in which some of our tenants operate. These impacts may continue and increase in severity as the duration of the pandemic lengthens, which may, in turn, adversely impact the fair value estimates of our real estate and recording of impairments on our properties. As a result, we are evaluating certain key assumptions involving fair value estimates of our real estate. We continue to evaluate the potential impacts of the COVID-19 pandemic and the measures taken to limit its spread on our business and industry segments, as the situation continues to evolve and more information becomes available. However, as of March 31, 2020, we have determined that the COVID-19 pandemic and the measures taken to limit its spread have not had a material impact on our consolidated financial statements as of and for period ended March 31, 2020. Based on the status of our business operations as of March 31, 2020, as a result of the COVID-19 pandemic, we expect to remain in compliance with the financial covenants for our unsecured notes and credit facility over the next 12 months. On April 8, 2020, the Financial Accounting Standards Board, or FASB, staff and FASB board members responded to questions about the accounting for COVID-19 related rent concessions under Topic 842, Leases . The accounting for these rent concessions under Topic 842 depends on the enforceable rights and obligations of the parties under the original lease contract (including those arising from the laws of the jurisdiction governing the lease contract) and the nature of any changes to the terms and conditions of the contract. If a rent concession under these circumstances is required by the original lease contract (e.g. by a force majeure clause), the concession will generally be accounted for as a variable lease payment. In contrast, if the lessor is under no obligation to grant a rent concession, the lessor’s agreement to grant one should be accounted for as a lease modification. The FASB staff has provided clarifying guidance for leases where the total lease cash flows will remain substantially the same or less than those after the COVID-19 related effects, though companies may choose to forgo the evaluation of the enforceable rights and obligations of the original lease contract as a practical expedient. Instead, the company would account for rent concessions, whatever their form (e.g. rent deferral, abatement or other), either (1) as if they are part of the enforceable rights and obligations of the parties under the existing lease contract; or (2) as a lease modification. If accounting for a concession as a lease modification, the full lease modification requirements under Topic 842 apply. Under either policy election, we must continue to assess the probability of collecting substantially all of the lease payments to which we are entitled under the original lease contract as required under Topic 842. If we conclude collection of substantially all lease payments is less than probable, rental revenue recognized is limited to cash received and existing operating lease receivables must be written off as an adjustment to rental revenue. We assess collectability of our future lease payments based on an analysis of creditworthiness, economic trends, including the COVID-19 pandemic, and other facts and circumstances related to the applicable tenants. As we collect the majority of our rent in advance and at this time we do not have any tenant specific information that would change our assessment that collection of substantially all of the future lease payments under our existing leases is probable, the impact of the COVID-19 pandemic on our tenants' ability to pay rent did not have a significant impact on our consolidated financial statements for the quarter ended March 31, 2020. However, since the conversations regarding rent collections for tenants affected by COVID-19 are ongoing we do not currently know the types of concessions, if any, that will ultimately be granted and, as a result, have not yet made an election to proceed with option (1) or (2) above. |
Supplemental Detail for Certain
Supplemental Detail for Certain Components of Consolidated Balance Sheets | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Text Block Supplement [Abstract] | |
Supplemental Detail for Certain Components of Consolidated Balance Sheets | Supplemental Detail for Certain Components of Consolidated Balance Sheets (dollars in thousands): A. Lease intangible assets, net, consist of the following at: March 31, 2020 December 31, 2019 In-place leases $ 1,667,826 $ 1,612,153 Accumulated amortization of in-place leases (659,165 ) (627,676 ) Above-market leases 720,341 710,275 Accumulated amortization of above-market leases (212,183 ) (201,369 ) $ 1,516,819 $ 1,493,383 B. Other assets, net, consist of the following at: March 31, 2020 December 31, 2019 Right of use asset - operating leases, net $ 119,648 $ 120,533 Right of use asset - financing leases 88,804 36,901 Restricted escrow deposits 82,391 4,529 Financing receivables 81,436 81,892 Derivative assets and receivables - at fair value 25,173 12 Prepaid expenses 16,113 11,839 Goodwill 14,397 14,430 Impounds related to mortgages payable 12,962 12,465 Credit facility origination costs, net 10,274 11,453 Corporate assets, net 5,534 5,251 Non-refundable escrow deposits 1,280 14,803 Value-added tax receivable — 9,682 Other items 2,238 4,871 $ 460,250 $ 328,661 C. Distributions payable consist of the following declared distributions at: March 31, 2020 December 31, 2019 Common stock distributions $ 80,803 $ 76,622 Noncontrolling interests distributions 108 106 $ 80,911 $ 76,728 D. Accounts payable and accrued expenses consist of the following at: March 31, 2020 December 31, 2019 Derivative liabilities and payables - at fair value $ 67,944 $ 26,359 Notes payable - interest payable 62,709 75,114 Property taxes payable 16,478 18,626 Accrued income taxes 4,429 4,450 Value-added tax payable 4,301 13,434 Accrued costs on properties under development 3,325 5,870 Mortgages, term loans, credit line - interest payable and interest rate swaps 1,876 1,729 Other items 21,115 31,457 $ 182,177 $ 177,039 E. Lease intangible liabilities, net, consist of the following at: March 31, 2020 December 31, 2019 Below-market leases $ 449,445 $ 447,522 Accumulated amortization of below-market leases (120,697 ) (114,419 ) $ 328,748 $ 333,103 F. Other liabilities consist of the following at: March 31, 2020 December 31, 2019 Lease liability - operating leases, net $ 121,790 $ 122,285 Rent received in advance and other deferred revenue 117,291 127,687 Security deposits 6,249 6,303 Lease liability - financing leases 6,023 5,946 $ 251,353 $ 262,221 |
Investments in Real Estate
Investments in Real Estate | 3 Months Ended |
Mar. 31, 2020 | |
Real Estate Investments, Net [Abstract] | |
Investments in Real Estate | Investments in Real Estate We acquire land, buildings and improvements necessary for the successful operations of commercial tenants. A. Acquisitions During the First Three Months of 2020 and 2019 Below is a summary of our acquisitions for the three months ended March 31, 2020 : Number of Properties Square Feet Investment Weighted Average Lease Term (Years) Initial Average Cash Lease Yield Three Months Ended March 31, 2020 (1) Acquisitions - U.S. (in 22 states) 54 1.4 $ 318.3 14.8 6.5 % Acquisitions - U.K. (2) 4 0.4 165.6 12.5 5.1 % Total Acquisitions 58 1.8 483.9 14.2 6.0 % Properties under Development - U.S. 7 0.2 2.1 10.6 7.5 % Total (3) 65 2.0 $ 486.0 14.1 6.0 % (1) None of our investments during the first three months of 2020 caused any one tenant to be 10% or more of our total assets at March 31, 2020 . All of our investments in acquired properties during the first three months of 2020 are 100% leased at the acquisition date. (2) Represents investments of £ 133.3 million Sterling during the three months ended March 31, 2020 converted at the applicable exchange rate on the date of acquisition. (3) The tenants occupying the new properties operate in 17 industries, and are 95.4% retail and 4.6% industrial, based on rental revenue. Approximately 36% of the rental revenue generated from acquisitions during the first three months of 2020 is from investment grade rated tenants, their subsidiaries or affiliated companies. The $486.0 million invested during the first three months of 2020 was allocated as follows: $70.2 million to land (of which $7.4 million was related to right of use assets under long-term ground leases), $56.9 million to right of use assets under ground leases, $295.9 million to buildings and improvements, $64.8 million to intangible assets related to leases, $508,000 to financing receivables related to certain leases with above-market terms, $1.4 million to intangible liabilities related to below-market leases and $934,000 to lease liabilities under ground leases. There was no contingent consideration associated with these acquisitions. The properties acquired during the first three months of 2020 generated total revenues of $3.9 million and net income of $1.2 million during the three months ended March 31, 2020 . Below is a summary of our acquisitions for the three months ended March 31, 2019: Number of Properties Square Feet Investment Weighted Average Lease Term (Years) Initial Average Cash Lease Yield Three months ended March 31, 2019 (1) Acquisitions - U.S. (in 25 states) 97 1.9 $ 508.6 17.0 6.7 % Properties under Development - U.S. 8 0.4 10.9 17.3 7.2 % Total (2) 105 2.3 $ 519.5 17.0 6.7 % (1) None of our investments during the first three months of 2019 caused any one tenant to be 10% or more of our total assets at March 31, 2019. All of our investments in acquired properties during the first three months of 2019 were 100% leased upon acquisition. (2) The tenants occupying the new properties operated in 14 industries, and the property types consisted of 98.7% retail and 1.3% industrial, based on rental revenue. Approximately 31% of the rental revenue generated from acquisitions during the first three months of 2019 was from investment grade rated tenants, their subsidiaries or affiliated companies. The $519.5 million invested during the first three months of 2019 was allocated as follows: $121.1 million to land, $329.2 million to buildings and improvements, $52.4 million to intangible assets related to leases, $26.3 million to financing receivables related to certain leases with off-market terms, and $9.5 million to intangible liabilities related to certain leases with below-market terms. There was no contingent consideration associated with these acquisitions. The properties acquired during the first three months of 2019 generated total revenues of $3.5 million and net income of $1.8 million during the three months ended March 31, 2019 . The initial average cash lease yield for a property is generally computed as estimated contractual first year cash net operating income, which, in the case of a net leased property, is equal to the aggregate cash base rent for the first full year of each lease, divided by the total cost of the property. Since it is possible that a tenant could default on the payment of contractual rent, we cannot provide assurance that the actual return on the funds invested will remain at the percentages listed above. In the case of a property under development or expansion, the contractual lease rate is generally fixed such that rent varies based on the actual total investment in order to provide a fixed rate of return. When the lease does not provide for a fixed rate of return on a property under development or expansion, the initial average cash lease yield is computed as follows: estimated cash net operating income (determined by the lease) for the first full year of each lease, divided by our projected total investment in the property, including land, construction and capitalized interest costs. B. Investments in Existing Properties During the first three months of 2020 , we capitalized costs of $2.1 million on existing properties in our portfolio, consisting of $138,000 for re-leasing costs and $2.0 million for non-recurring building improvements. In comparison, during the first three months of 2019 , we capitalized costs of $3.0 million on existing properties in our portfolio, consisting of $323,000 for re-leasing costs, $56,000 for recurring capital expenditures, and $2.6 million for non-recurring building improvements. C. Properties with Existing Leases Of the $486.0 million we invested during the first three months of 2020 , approximately $363.0 million was used to acquire 39 properties with existing leases. In comparison, of the $519.5 million we invested during the first three months of 2019 , approximately $258.0 million was used to acquire 53 properties with existing leases. The value of the in-place and above-market leases is recorded to lease intangible assets, net on our consolidated balance sheets, and the value of the below-market leases is recorded to lease intangible liabilities, net on our consolidated balance sheets. The values of the in-place leases are amortized as depreciation and amortization expense. The amounts amortized to expense for all of our in-place leases, for the first three months of 2020 and 2019 were $32.6 million and $26.0 million , respectively. The values of the above-market and below-market leases are amortized over the term of the respective leases, including any bargain renewal options, as an adjustment to rental revenue on our consolidated statements of income and comprehensive income. The amounts amortized as a net decrease to rental revenue for capitalized above-market and below-market leases for the first three months of 2020 and 2019 were $8.2 million and $3.4 million , respectively. If a lease was to be terminated prior to its stated expiration, all unamortized amounts relating to that lease would be recorded to revenue or expense, as appropriate. The following table presents the estimated impact during the next five years and thereafter related to the amortization of the above-market and below-market lease intangibles and the amortization of the in-place lease intangibles at March 31, 2020 (dollars in thousands): Net decrease to rental revenue Increase to amortization expense 2020 $ (17,775 ) $ 96,203 2021 (22,683 ) 120,617 2022 (21,135 ) 108,643 2023 (19,618 ) 96,339 2024 (18,031 ) 87,650 Thereafter (80,168 ) 499,209 Totals $ (179,410 ) $ 1,008,661 |
Credit Facility
Credit Facility | 3 Months Ended |
Mar. 31, 2020 | |
Credit Facility | |
Debt | |
Debt | Credit Facility We have a $3.0 billion unsecured revolving credit facility with an initial term that expires in March 2023 and includes, at our option, two six-month extensions. The revolving credit facility allows us to borrow in up to 14 currencies, including U.S. dollars, and has a $1.0 billion expansion option, which is subject to obtaining lender commitments. Under our credit facility, our investment grade credit ratings as of March 31, 2020 provide for financing at the London Interbank Offered Rate, commonly referred to as LIBOR, plus 0.775% with a facility commitment fee of 0.125% , for all-in drawn pricing of 0.90% over LIBOR . The borrowing rate is subject to an interest rate floor and may change if our investment grade credit ratings change. We also have other interest rate options available to us under our revolving credit facility. Our revolving credit facility is unsecured and, accordingly, we have not pledged any assets as collateral for this obligation. At March 31, 2020 , credit facility origination costs of $10.3 million are included in other assets, net, as compared to $11.5 million at December 31, 2019 , on our consolidated balance sheet. These costs are being amortized over the remaining term of our revolving credit facility. At March 31, 2020 , we had a borrowing capacity of $2.4 billion available on our revolving credit facility (subject to customary conditions to borrowing) and an outstanding balance of $615.2 million , including £282.8 million Sterling, as compared to an outstanding balance of $704.3 million , including £169.2 million Sterling, at December 31, 2019 . On April 9, 2020 , we borrowed an additional $1.2 billion on our revolving credit facility to increase our cash position to $1.25 billion as a conservative measure due to COVID-19. See Note 21, Subsequent Events . The weighted average interest rate on outstanding borrowings under our revolving credit facility was 2.1% during the first three months of 2020 and 3.3% during the first three months of 2019 . At March 31, 2020 and December 31, 2019, the weighted average interest rate on borrowings outstanding under our revolving credit facility was 1.3% and 2.2% , respectively. Our revolving credit facility is subject to various leverage and interest coverage ratio limitations, and at March 31, 2020 , we were in compliance with the covenants on our revolving credit facility. |
Term Loans
Term Loans | 3 Months Ended |
Mar. 31, 2020 | |
Term Loans | |
Debt | |
Debt | Term Loans In October 2018, in conjunction with entering into our current revolving credit facility, we entered into a $250.0 million senior unsecured term loan, which matures in March 2024. Borrowing under this term loan bears interest at the current one-month LIBOR, plus 0.85% . In conjunction with this term loan, we also entered into an interest rate swap, which effectively fixes our per annum interest on this term loan at 3.89% . In June 2015, in conjunction with entering into our previous revolving credit facility, we entered into a $250.0 million senior unsecured term loan maturing in June 2020. Borrowing under this term loan bears interest at the current one-month LIBOR , plus 0.90% . In conjunction with this term loan, we also entered into an interest rate swap which effectively fixes our per annum interest rate on this term loan at 2.62% . Upon the maturity of this term loan, we intend to either repay the outstanding principal with cash on hand, enter into an amendment to our current term loan, or enter into a new term loan. Deferred financing costs of $1.2 million incurred in conjunction with the $250.0 million term loan maturing June 2020 and $1.1 million incurred in conjunction with the $250.0 million term loan maturing March 2024 are being amortized over the remaining terms of each respective term loan. The net balance of these deferred financing costs, which was $849,000 at March 31, 2020 , and $956,000 at December 31, 2019 , is included within term loans, net on our consolidated balance sheets. |
Mortgages Payable
Mortgages Payable | 3 Months Ended |
Mar. 31, 2020 | |
Mortgages Payable | |
Debt | |
Debt | Mortgages Payable During the first three months of 2020 , we made $1.7 million in principal payments. During the first three months of 2019 , we made $1.2 million in principal payments. No mortgages were assumed during the first three months of 2020 or 2019 . Assumed mortgages are secured by the properties on which the debt was placed and are considered non-recourse debt with limited customary exceptions for items such as solvency, bankruptcy, misrepresentation, fraud, misapplication of payments, environmental liabilities, failure to pay taxes, insurance premiums, liens on the property, violations of the single purpose entity requirements, and uninsured losses. Our mortgages contain customary covenants, such as limiting our ability to further mortgage each applicable property or to discontinue insurance coverage without the prior consent of the lender. At March 31, 2020 , we were in compliance with these covenants. The balance of our deferred financing costs, which are classified as part of mortgages payable, net, on our consolidated balance sheets, was $1.2 million at March 31, 2020 and $1.3 million at December 31, 2019 . These costs are being amortized over the remaining term of each mortgage. The following table summarizes our mortgages payable as of March 31, 2020 and December 31, 2019 , respectively (dollars in thousands): As Of Number of Properties (1) Weighted Average Stated Interest Rate (2) Weighted Average Effective Interest Rate (3) Weighted Average Remaining Years Until Maturity Remaining Principal Balance Unamortized Premium and Deferred Financing Costs Balance, net Mortgage Payable Balance 3/31/2020 92 4.9 % 4.7 % 2.9 $ 406,746 $ 1,412 $ 408,158 12/31/2019 92 4.9 % 4.6 % 3.1 $ 408,419 $ 1,700 $ 410,119 (1) At March 31, 2020 and December 31, 2019 , there were 27 mortgages on 92 properties. The mortgages require monthly payments with principal payments due at maturity. The mortgages were at fixed interest rates, except for one variable rate mortgage on one property, which has been swapped to a fixed interest rate, with a principal balance at March 31, 2020 and December 31, 2019 of $7.0 million and $7.1 million , respectively. (2) Stated interest rates ranged from 3.8% to 6.9% at each of March 31, 2020 and December 31, 2019 . (3) Effective interest rates ranged from 3.8% to 7.6% at each of March 31, 2020 and December 31, 2019 . The following table summarizes the maturity of mortgages payable, excluding net premiums of $2.6 million and deferred financing costs of $1.2 million , as of March 31, 2020 (dollars in millions): Year of Maturity Principal 2020 $ 82.6 2021 68.8 2022 111.8 2023 20.6 2024 112.1 Thereafter 10.8 Totals $ 406.7 |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2020 | |
Notes payable | |
Debt | |
Debt | Notes Payable A. General Our senior unsecured notes and bonds consist of the following, sorted by maturity date (dollars in millions): March 31, 2020 December 31, 2019 5.750% notes, issued in June 2010 and due in January 2021 $ — $ 250 3.250% notes, $450 issued in October 2012 and $500 issued in December 2017, both due in October 2022 950 950 4.650% notes, issued in July 2013 and due in August 2023 750 750 3.875% notes, issued in June 2014 and due in July 2024 350 350 3.875% notes, issued in April 2018 and due in April 2025 500 500 4.125% notes, $250 issued in September 2014 and $400 issued in March 2017, both due in October 2026 650 650 3.000% notes, issued in October 2016 and due in January 2027 600 600 3.650% notes, issued in December 2017 and due in January 2028 550 550 3.250% notes, issued in June 2019 and due in June 2029 500 500 2.730% notes, issued in May 2019 and due in May 2034 (1) 391 418 5.875% bonds, $100 issued in March 2005 and $150 issued in June 2011, both due in March 2035 250 250 4.650% notes, $300 issued in March 2017 and $250 issued in December 2017, both due in March 2047 550 550 Total principal amount 6,041 6,318 Unamortized net original issuance premiums and deferred financing costs (28 ) (30 ) $ 6,013 $ 6,288 (1) Represents the principal balance (in U.S. dollars) of the Sterling-denominated private placement of £315.0 million converted at the applicable exchange rates on March 31, 2020 , and December 31, 2019 , respectively. The following table summarizes the maturity of our notes and bonds payable as of March 31, 2020 , excluding net unamortized original issuance premiums and deferred financing costs (dollars in millions): Year of Maturity Principal 2022 $ 950 2023 750 2024 350 Thereafter 3,991 Totals $ 6,041 As of March 31, 2020 , the weighted average interest rate on our notes and bonds payable was 3.8% and the weighted average remaining years until maturity was 8.3 years . All of our outstanding notes and bonds payable have fixed interest rates and contain various covenants, with which we remained in compliance as of March 31, 2020 . Additionally, interest on all of our senior unsecured note and bond obligations is paid semiannually. B. Note Repayment In January 2020, we completed the early redemption on all $250.0 million in principal amount of our outstanding 5.750% notes due January 2021, plus accrued and unpaid interest. As a result of the early redemption, we recognized a $9.8 million loss on extinguishment of debt on our consolidated statement of income for the first quarter of 2020. |
Issuances of Common Stock
Issuances of Common Stock | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Issuances of Common Stock | Issuances of Common Stock A. Issuance of Common Stock in an Underwritten Public Offering In March 2020, we issued 9,690,500 shares of common stock in an underwritten public offering, including 690,500 shares purchased by the underwriters upon the exercise of their option to purchase additional shares. After deducting underwriting discounts and other offering costs of $21.5 million , the net proceeds of $728.5 million were used to repay borrowings under our credit facility, to fund investment opportunities, and for other general corporate purposes. B. Dividend Reinvestment and Stock Purchase Plan Our Dividend Reinvestment and Stock Purchase Plan, or our DRSPP, provides our common stockholders, as well as new investors, with a convenient and economical method of purchasing our common stock and reinvesting their distributions. Our DRSPP also allows our current stockholders to buy additional shares of common stock by reinvesting all or a portion of their distributions. Our DRSPP authorizes up to 26,000,000 common shares to be issued. At March 31, 2020 , we had 11,618,668 shares remaining for future issuance under our DRSPP program. The following table outlines common stock issuances pursuant to our DRSPP program (dollars in millions): Three Months Ended March 31, 2020 2019 Shares of common stock issued under the DRSPP program 34,000 31,898 Gross proceeds $ 2.4 $ 2.2 Our DRSPP includes a waiver approval process, allowing larger investors or institutions, per a formal approval process, to purchase shares at a small discount, if approved by us. We did not issue shares under the waiver approval process during the first three months of 2020 or 2019 . C. At-the-Market (ATM) Program Under our "at-the-market" equity distribution plan, or our ATM program, up to 33,402,405 shares of common stock may be offered and sold (1) by us to, or through, a consortium of banks acting as our sales agents or (2) by a consortium of banks acting as forward sellers on behalf of any forward purchasers contemplated thereunder, in each case by means of ordinary brokers' transactions on the New York Stock Exchange ("NYSE: O") at prevailing market prices or at negotiated prices. At March 31, 2020, we had 33,402,405 shares remaining for future issuance under our ATM program. We anticipate maintaining the availability of our ATM program in the future, including through replenishing the authorized shares issuable thereunder. We did not issue any shares under the ATM program during the first three months of 2020 or 2019. |
Noncontrolling Interests
Noncontrolling Interests | 3 Months Ended |
Mar. 31, 2020 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests | Noncontrolling Interests The two noncontrolling interests that we consolidate include an operating partnership, Realty Income, L.P., and a joint venture acquired during 2019. The following table represents the change in the carrying value of all noncontrolling interests through March 31, 2020 (dollars in thousands): Realty Income, L.P. units (1) Other Noncontrolling Interests Total Carrying value at December 31, 2019 $ 24,596 $ 5,106 $ 29,702 Distributions (323 ) (71 ) (394 ) Allocation of net income 277 39 316 Carrying value at March 31, 2020 $ 24,550 $ 5,074 $ 29,624 (1) 242,007 units were issued on March 30, 2018, 131,790 units were issued on April 30, 2018, and 89,322 units were issued on March 28, 2019. 463,119 remained outstanding at each of March 31, 2020 and December 31, 2019 . At March 31, 2020 and December 31, 2019 , Realty Income, L.P. and the joint venture acquired during 2019 were considered variable interest entities, or VIEs, in which we were deemed the primary beneficiary based on our controlling financial interests. Below is a summary of selected financial data of consolidated VIEs included in the consolidated balance sheets at March 31, 2020 and December 31, 2019 (in thousands): March 31, 2020 December 31, 2019 Net real estate $ 647,877 $ 654,305 Total assets 737,990 744,394 Total liabilities 52,613 52,087 |
Financial Instruments and Fair
Financial Instruments and Fair Value Measurements | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments and Fair Value Measurements | Financial Instruments and Fair Value Measurements Fair value is defined as the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The disclosure for assets and liabilities measured at fair value requires allocation to a three-level valuation hierarchy. This valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. Categorization within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement. We believe that the carrying values reflected in our consolidated balance sheets reasonably approximate the fair values for cash and cash equivalents, accounts receivable, escrow deposits, loans receivable, line of credit payable, term loans and all other liabilities, due to their short-term nature or interest rates and terms that are consistent with market, except for our mortgages payable assumed in connection with acquisitions and our senior notes and bonds payable, which are disclosed as follows (dollars in millions): March 31, 2020 Carrying value Estimated fair value Mortgages payable assumed in connection with acquisitions (1) $ 406.7 $ 410.3 Notes and bonds payable (2) 6,041.2 6,008.4 December 31, 2019 Carrying value Estimated fair value Mortgages payable assumed in connection with acquisitions (1) $ 408.4 $ 417.7 Notes and bonds payable (2) 6,317.6 6,826.1 (1) Excludes non-cash net premiums recorded on the mortgages payable. The unamortized balance of these net premiums was $2.6 million at March 31, 2020 , and $3.0 million at December 31, 2019 . Also excludes deferred financing costs of $1.2 million at March 31, 2020 and $1.3 million at December 31, 2019 . (2) Excludes non-cash original issuance premiums and discounts recorded on notes payable. The unamortized balance of the net original issuance premiums was $6.2 million at March 31, 2020 , and $6.3 million at December 31, 2019 . Also excludes deferred financing costs of $34.3 million at March 31, 2020 and $35.9 million at December 31, 2019 . The estimated fair values of our mortgages payable assumed in connection with acquisitions and private senior notes payable have been calculated by discounting the future cash flows using an interest rate based upon the relevant forward interest rate curve, plus an applicable credit-adjusted spread. Because this methodology includes unobservable inputs that reflect our own internal assumptions and calculations, the measurement of estimated fair values related to our mortgages payable is categorized as level three on the three-level valuation hierarchy. The estimated fair values of our publicly-traded senior notes and bonds payable are based upon indicative market prices and recent trading activity of our senior notes and bonds payable. Because this methodology includes inputs that are less observable by the public and are not necessarily reflected in active markets, the measurement of the estimated fair values related to our notes and bonds payable is categorized as level two on the three-level valuation hierarchy. In February 2020, we entered into five forward starting treasury rate locks with notional amounts totaling $500.0 million . The treasury rate locks were entered into to hedge our exposure to the changes in the 10-year US treasury rates in anticipation of potential future debt offerings during the first half of 2020. These treasury rate locks are designated as cash flow hedges, with any changes in fair value recorded in accumulated other comprehensive income, or AOCI. In May 2019, we entered into four cross-currency swaps to exchange £130 million for $166 million maturing in May 2034, in order to hedge the foreign currency risk associated with our Sterling-denominated intercompany loan receivable from our consolidated foreign subsidiaries. These cross-currency swaps were designated as cash flow hedges on their trade date. Gains and losses, representing hedge components excluded from the assessment of effectiveness, are recognized in earnings over the life of the hedges on a systematic and rational basis, as documented at hedge inception in accordance with our accounting policy election. The earnings recognition of excluded components is presented in foreign currency and derivative gains, net on our consolidated statements of income and comprehensive income, which is the same caption item as the hedged transactions. We record interest rate swaps on the consolidated balances sheet at fair value. Changes to fair value are recorded to AOCI. The following table summarizes the terms and fair values of our derivative financial instruments at March 31, 2020 and December 31, 2019 (dollars in millions): Derivative Type Hedge Designation Notional Amount Strike Effective Date Maturity Date Fair Value - asset (liability) March 31, December 31, March 31 December 31, 2020 2019 2020 2019 Interest rate swap Cash flow $ 7.0 $ 7.0 6.03% 09/25/2012 09/03/2021 $ (0.3 ) $ (0.2 ) Interest rate swap Cash flow 250.0 250.0 1.72% 06/30/2015 06/30/2020 (0.6 ) (0.1 ) Interest rate swap Cash flow 250.0 250.0 3.04% 10/24/2018 03/24/2024 (25.3 ) (14.7 ) Cross-currency swap (1) Cash flow 41.6 41.6 (2) 05/20/2019 05/22/2034 6.9 (2.6 ) Cross-currency swap (1) Cash flow 41.6 41.6 (3) 05/20/2019 05/22/2034 6.4 (2.6 ) Cross-currency swap (1) Cash flow 41.6 41.6 (4) 05/20/2019 05/22/2034 6.0 (2.9 ) Cross-currency swap (1) Cash flow 41.6 41.6 (5) 05/20/2019 05/22/2034 5.8 (3.2 ) Treasury rate lock (6) Cash flow 75.0 — 1.63% (6) 06/30/2020 (6.9 ) — Treasury rate lock (6) Cash flow 75.0 — 1.63% (6) 06/30/2020 (6.9 ) — Treasury rate lock (6) Cash flow 100.0 — 1.64% (6) 06/30/2020 (9.2 ) — Treasury rate lock (6) Cash flow 100.0 — 1.57% (6) 06/30/2020 (8.6 ) — Treasury rate lock (6) Cash flow 150.0 — 1.37% (6) 06/30/2020 (10.0 ) — $ 1,173.4 $ 673.4 $ (42.7 ) $ (26.3 ) (1) Represents British Pound Sterling, or GBP, United States Dollar, or USD, cross-currency swap. (2) GBP fixed rates initially at 4.82% and escalating to 10.96% , and USD fixed rate at 9.800% . (3) GBP fixed rates initially at 4.82% and escalating to 10.96% , and USD fixed rate at 9.803% . (4) GBP fixed rates initially at 4.82% and escalating to 10.96% , and USD fixed rate at 9.745% . (5) GBP fixed rates initially at 4.82% and escalating to 10.96% , and USD fixed rate at 9.755% . (6) These treasury rate locks were entered into during February 2020 to hedge our exposure to the changes in the 10-year US treasury rate on potential future debt offerings during the first half of 2020. In the event we do not execute a debt offering or offerings within the original contract maturity, we may elect to extend the maturity of all or a portion of these contracts. We measure our derivatives at fair value and include the balances within other assets and accounts payable and accrued expenses on our consolidated balance sheets. We have agreements with each of our derivative counterparties containing provisions under which we could be declared in default on our derivative obligations if repayment of our indebtedness is accelerated by the lender due to our default. We utilize interest rate swap agreements to manage interest rate risk and cross-currency swaps to manage foreign currency risk. The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves, spot and forward rates, as well as option volatility. To comply with the provisions of ASC 820, Fair Value Measurement , we incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. Although we have determined that the majority of the inputs used to value our derivatives fall within level two on the three-level valuation hierarchy, the credit valuation adjustments associated with our derivatives utilize level three inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by ourselves and our counterparties. However, at March 31, 2020 and December 31, 2019, we assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we determined that our derivative valuations in their entirety are classified as level two on the three-level valuation hierarchy. Unrealized gains and losses in AOCI are reclassified to interest expense in the case of interest rate swaps and to foreign currency gains and losses, net in the case of cross-currency swaps, when the related hedged items are recognized. During the three months ended March 31, 2020 , we reclassified $1.6 million from AOCI as an increase to interest expense for our interest rate swaps and $11.4 million for cross-currency swaps into foreign exchange gains. During the first three months of 2019, we reclassified $678,000 from AOCI into interest expense. We expect to reclassify $12.0 million from AOCI as an increase to interest expense relating to interest rate swaps and treasury locks and $2.1 million |
Operating Leases
Operating Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Operating Leases | Operating Leases A. At March 31, 2020 , we owned 6,525 properties in 49 U.S. states, Puerto Rico, and the U.K. Of the 6,525 properties, 6,490 , or 99.5% , are single-tenant properties, and the remaining are multi-tenant properties. At March 31, 2020 , 97 properties were available for lease or sale. Substantially all of our leases are net leases where the tenant pays or reimburses us for property taxes and assessments, maintains the interior and exterior of the building and leased premises, and carries insurance coverage for public liability, property damage, fire and extended coverage. Rent based on a percentage of a tenants’ gross sales, or percentage rents, for the first three months of 2020 and 2019 was $1.2 million and $3.6 million , respectively. B. Major Tenants - No individual tenant’s rental revenue, including percentage rents, represented more than 10% of our total revenue for each of the three months ended March 31, 2020 and 2019. |
Gain on Sales of Real Estate
Gain on Sales of Real Estate | 3 Months Ended |
Mar. 31, 2020 | |
Gain (Loss) on Sale of Investments [Abstract] | |
Gain on Sales of Real Estate | Gain on Sales of Real Estate The following table summarizes our properties sold during the periods indicated below (dollars in millions): Three Months Ended March 31, 2020 2019 Number of properties 17 19 Net sales proceeds $ 126.2 $ 22.5 Gain on sales of real estate $ 38.5 $ 7.3 |
Impairments
Impairments | 3 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Impairments | Impairments We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. A provision is made for impairment if estimated future operating cash flows (undiscounted and without interest charges) plus estimated disposition proceeds (undiscounted) are less than the current book value of the property. Key factors that we utilize in this analysis include projected rental rates, estimated holding periods, capital expenditures and property sales capitalization rates. If a property is classified as held for sale, it is carried at the lower of carrying cost or estimated fair value, less estimated cost to sell, and depreciation of the property ceases. The following table summarizes our provisions for impairment during the periods indicated below (dollars in millions): Three Months Ended March 31, 2020 2019 Total provisions for impairment $ 4.5 $ 4.7 Number of properties: Classified as held for sale 8 — Classified as held for investment 1 — Sold 7 11 |
Distributions Paid and Payable
Distributions Paid and Payable | 3 Months Ended |
Mar. 31, 2020 | |
Dividends [Abstract] | |
Distributions Paid and Payable | Distributions Paid and Payable We pay monthly distributions to our common stockholders. The following is a summary of monthly distributions paid per common share for the first three months of 2020 and 2019 : Month 2020 2019 January $ 0.2275 $ 0.2210 February 0.2325 0.2255 March 0.2325 0.2255 Total $ 0.6925 $ 0.6720 At March 31, 2020 , a distribution of $0.233 per common share was payable and was paid in April 2020. |
Net Income per Common Share
Net Income per Common Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Income per Common Share | Net Income per Common Share Basic net income per common share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during each period. Diluted net income per common share is computed by dividing net income available to common stockholders, plus income attributable to dilutive shares and convertible common units, for the period by the weighted average number of common shares that would have been outstanding assuming the issuance of common shares for all potentially dilutive common shares outstanding during the reporting period. The following is a reconciliation of the denominator of the basic net income per common share computation to the denominator of the diluted net income per common share computation: Three Months Ended March 31, 2020 2019 Weighted average shares used for the basic net income per share computation 336,624,567 303,528,336 Incremental shares from share-based compensation 351,948 291,542 Weighted average shares used for diluted net income per share computation 336,976,515 303,819,878 Unvested shares from share-based compensation that were anti-dilutive 31,001 30,060 Weighted average partnership common units convertible to common shares that were anti-dilutive 463,119 377,767 |
Supplemental Disclosures of Cas
Supplemental Disclosures of Cash Flow Information | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Disclosures of Cash Flow Information | Supplemental Disclosures of Cash Flow Information Cash paid for interest was $84.1 million in the first three months of 2020 and $82.2 million in the first three months of 2019 . Cash paid for income taxes was $2.5 million in the first three months of 2020 and $1.7 million in the first three months of 2019 . The following non-cash activities are included in the accompanying consolidated financial statements: A. As a result of the adoption of Accounting Standards Update, or ASU, 2016-02 in 2019, we recorded $132.0 million of lease liabilities and related right of use assets as lessee under operating leases on January 1, 2019. B. During the first three months of 2019 , we issued 89,322 common partnership units of Realty Income, L.P. as partial consideration for an acquisition of properties, totaling $6.3 million . C. During the first three months of 2020, the fair value of net derivative liabilities decreased by $16.4 million . D. Non-refundable deposits from 2019 of $14.8 million were applied to acquisitions during the first three months of 2020. Per the requirements of ASU 2016-18 (Topic 230, Statement of Cash Flows ), the following table provides a reconciliation of cash and cash equivalents reported within the consolidated balance sheets to the total of the cash, cash equivalents and restricted cash reported within the consolidated statements of cash flows (dollars in thousands): March 31, 2020 March 31, 2019 Cash and cash equivalents shown in the consolidated balance sheets $ 41,804 $ 2,997 Restricted escrow deposits (1) 82,391 9,081 Impounds related to mortgages payable (1) 12,962 10,256 Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 137,157 $ 22,334 (1) Included within other assets, net on the consolidated balance sheets (see note 3). These amounts consist of cash that we are legally entitled to, but that is not immediately available to us. As a result, these amounts were considered restricted as of the dates presented. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We evaluate performance and make resource allocation decisions on an industry by industry basis. For financial reporting purposes, we have grouped our tenants into 51 activity segments. All of the properties are incorporated into one of the applicable segments. Unless otherwise specified, all segments listed below are located within the U.S. Because almost all of our leases require the tenant to pay operating expenses, rental revenue is the only component of segment profit and loss we measure. The following tables set forth certain information regarding the properties owned by us, classified according to the business of the respective tenants (dollars in thousands): Assets, as of: March 31, 2020 December 31, 2019 Segment net real estate: Automotive service $ 286,380 $ 288,453 Automotive tire services 232,093 232,709 Beverages 278,318 279,373 Child care 217,120 208,326 Convenience stores 2,040,499 2,057,157 Dollar stores 1,430,852 1,427,950 Drug stores 1,603,799 1,618,854 Financial services 386,310 389,634 General merchandise 515,199 475,418 Grocery stores - U.S. (1) 911,070 922,349 Grocery stores - U.K. (1) 664,056 663,210 Health and fitness 1,092,881 1,019,796 Home improvement 503,092 495,305 Restaurants-casual dining 568,547 576,526 Restaurants-quick service 1,067,239 1,059,155 Theaters - U.S. (1) 869,621 878,103 Transportation services 720,929 769,614 Wholesale club 393,501 396,690 Other non-reportable segments 2,810,431 2,738,150 Total net real estate 16,591,937 16,496,772 Intangible assets: Automotive service 57,833 58,854 Automotive tire services 6,940 7,322 Beverages 1,444 1,509 Child care 22,805 21,997 Convenience stores 129,145 131,808 Dollar stores 81,755 82,701 Drug stores 179,585 183,319 Financial services 16,468 17,130 General merchandise 74,187 66,135 Grocery stores - U.S. (1) 176,030 180,197 Grocery stores - U.K. (1) 177,001 153,407 Health and fitness 74,257 74,428 Home improvement 73,939 72,979 Restaurants-casual dining 22,629 23,289 Restaurants-quick service 51,372 52,353 Theaters - U.S. (1) 35,029 36,089 Transportation services 58,957 66,055 Wholesale club 22,594 23,372 Other non-reportable segments 254,849 240,439 Other corporate assets 687,686 564,641 Total assets $ 18,796,442 $ 18,554,796 Three months ended March 31, Revenue 2020 2019 Segment rental revenue: Automotive service $ 8,670 $ 7,213 Automotive tire services 7,833 7,777 Beverages 7,996 7,915 Child care 9,481 7,827 Convenience stores 46,733 41,214 Dollar stores 31,391 24,986 Drug stores 35,299 33,170 Financial services 7,543 7,718 General merchandise 11,316 6,911 Grocery stores - U.S. (1) 19,509 16,124 Grocery stores - U.K. (1) 10,405 — Health and fitness 28,278 26,225 Home improvement 11,309 9,815 Restaurants-casual dining 12,538 11,290 Restaurants-quick service 23,308 21,730 Theaters - U.S. (1) 24,567 17,656 Transportation services 16,187 16,026 Wholesale club 9,588 9,593 Other non-reportable segments and tenant reimbursements 90,206 80,847 Rental (including reimbursable) 412,157 354,037 Other 2,184 328 Total revenue $ 414,341 $ 354,365 (1) Our investments in industries outside of the U.S. are managed as separate operating segments. |
Common Stock Incentive Plan
Common Stock Incentive Plan | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Common Stock Incentive Plan | Common Stock Incentive Plan In 2012, our Board of Directors adopted and stockholders approved the Realty Income Corporation 2012 Incentive Award Plan, or the 2012 Plan, to enable us to motivate, attract and retain the services of directors and employees considered essential to our long-term success. The 2012 Plan offers our directors and employees an opportunity to own our stock or rights that will reflect our growth, development and financial success. Under the terms of the 2012 plan, the aggregate number of shares of our common stock subject to options, restricted stock, stock appreciation rights, restricted stock units and other awards, will be no more than 3,985,734 shares. The 2012 Plan has a term of ten years from the date it was adopted by our Board of Directors. The amount of share-based compensation costs recognized in general and administrative expense on our consolidated statements of income and comprehensive income was $5.5 million during the first three months of 2020 (including $1.8 million of accelerated share-based compensation costs for our former Chief Financial Officer ("CFO") upon his departure from the company), and $2.8 million during the first three months of 2019 . Upon the departure of our former CFO in the first quarter of 2020, we incurred a severance charge of $3.5 million , consisting of $1.6 million of cash, $1.8 million related to share–based compensation expense and $58,000 of professional fees. A. Restricted Stock During the first three months of 2020 , we granted 62,873 shares of common stock under the 2012 Plan. These shares vest over a four-year service period, with the exception of 4,541 shares granted to our former CFO, which vested upon his departure from the Company. As of March 31, 2020 , the remaining unamortized share-based compensation expense related to restricted stock totaled $12.4 million , which is being amortized on a straight-line basis over the service period of each applicable award. The amount of share-based compensation is based on the fair value of the stock at the grant date. We define the grant date as the date the recipient and Realty Income have a mutual understanding of the key terms and conditions of the award, and the recipient of the grant begins to benefit from, or be adversely affected by, subsequent changes in the price of the shares. B. Performance Shares and Restricted Stock Units During the first three months of 2020 , we granted 98,844 performance shares, as well as dividend equivalent rights, to our executive officers. The performance shares are earned based on our Total Shareholder Return (TSR) performance relative to select industry indices and peer groups as well as achievement of certain operating metrics, and vest 50% on the first and second January 1 after the end of the three -year performance period, subject to continued service. During the first three months of 2020 , we also granted 9,966 restricted stock units, all of which vest over a four -year service period. These restricted stock units have the same economic rights as shares of restricted stock. As of March 31, 2020 , the remaining share-based compensation expense related to the performance shares and restricted stock units totaled $15.6 million . The fair value of the performance shares were estimated on the date of grant using a Monte Carlo Simulation model. The performance shares are being recognized on a tranche-by-tranche basis over the service period. The amount of share-based compensation for the restricted stock units is based on the fair value of our common stock at the grant date. The restricted stock units are being recognized on a straight-line basis over the service period. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies In the ordinary course of business, we are party to various legal actions which we believe are routine in nature and incidental to the operation of our business. We believe that the outcome of the proceedings will not have a material adverse effect upon our consolidated financial position or results of operations. At March 31, 2020 , we had commitments of $6.1 million for re-leasing costs, recurring capital expenditures, and non-recurring building improvements. In addition, as of March 31, 2020 , we had committed $13.2 million under construction contracts related to development projects, which is expected to be paid in the next twelve months. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events • In April 2020 , we declared a dividend of $0.233 per share to our common stockholders, which will be paid in May 2020 . • On April 9, 2020 , we borrowed an additional $1.2 billion under revolving credit facility to increase our cash position to $1.25 billion as a conservative measure due to the COVID-19 pandemic. As of May 1, 2020 , we had $1.9 billion of borrowings outstanding under our revolving credit facility, including £325.5 million of Sterling-denominated borrowings, with a remaining available capacity of $1.1 billion . The revolving credit facility also has a $1.0 billion expansion option, which is subject to obtaining lender commitments. • In addition, on April 9, 2020 , we withdrew our 2020 guidance that was provided on February 19, 2020 due to the ongoing uncertainty regarding the impact of the COVID-19 pandemic and the measures taken to limit its spread. We are continuing to evaluate these impacts on our business as the situation continues to evolve and feel it is not prudent to provide revised guidance at this time. As of May 1, 2020 : ◦ We have collected 82.9% of contractual rent (1) due for the month of April 2020 across our total portfolio; ◦ We are in rent deferral discussions with tenants that account for a majority of the unpaid contractual rent for the month of April 2020, as well as certain tenants that did pay April contractual rent ; ◦ We have collected 82.9% of contractual rent due for the month of April 2020 from our top 20 tenants (2) ; and ◦ We have collected 99.9% of contractual rent due for the month of April 2020 from our investment grade tenants (3) . (1) Contractual rent is the aggregate cash amount charged to tenants inclusive of April monthly base rent receivables, offset by applicable discounts or credits. U.K. rent (which is payable in pounds Sterling) was converted at the exchange rate in effect on May 1, 2020 . (2 ) We define top 20 tenants as our 20 largest tenants based on percentage of total portfolio annualized rental revenue. (3) We define investment grade tenants as tenants with a credit rating, and tenants that are subsidiaries or affiliates of companies with a credit rating, of Baa3/BBB- or higher from one of the three major rating agencies (Moody’s/S&P/Fitch). |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies and Procedures and Recent Accounting Pronouncements (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | A. The accompanying consolidated financial statements include the accounts of Realty Income and other subsidiaries for which we make operating and financial decisions (i.e., control), after elimination of all material intercompany balances and transactions. We consolidate entities that we control and record a noncontrolling interest for the portion that we do not own. Noncontrolling interest that was created or assumed as part of a business combination or asset acquisition was recognized at fair value as of the date of the transaction (see note 10). We have no unconsolidated investments. |
Income Taxes | B. We have elected to be taxed as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended. We believe we have qualified and continue to qualify as a REIT. Under the REIT operating structure, we are permitted to deduct dividends paid to our stockholders in determining our taxable income. Assuming our dividends equal or exceed our taxable net income, we generally will not be required to pay federal corporate income taxes on such income. Accordingly, no provision has been made for federal income taxes in the accompanying consolidated financial statements, except for federal income taxes of our taxable REIT subsidiaries. The income taxes recorded on our consolidated statements of income and comprehensive income represent amounts paid by Realty Income and its subsidiaries for city and state income and franchise taxes and for U.K. income taxes. |
Leases | We assess collectability of our future lease payments based on an analysis of creditworthiness, economic trends, including the COVID-19 pandemic, and other facts and circumstances related to the applicable tenants. As we collect the majority of our rent in advance and at this time we do not have any tenant specific information that would change our assessment that collection of substantially all of the future lease payments under our existing leases is probable, the impact of the COVID-19 pandemic on our tenants' ability to pay rent did not have a significant impact on our consolidated financial statements for the quarter ended March 31, 2020. However, since the conversations regarding rent collections for tenants affected by COVID-19 are ongoing we do not currently know the types of concessions, if any, that will ultimately be granted and, as a result, have not yet made an election to proceed with option (1) or (2) above. |
Reclassification | D. During the first three months of 2020, we reclassified 'Real estate held for sale, net', which was previously presented in 'Net real estate', into a new caption entitled 'Real estate and lease intangibles held for sale, net'. The reclassification out of 'Net real estate' incorporates intangibles held for sale into a more appropriate presentation of the held for sale caption. Intangibles held for investment are included in the captions entitled 'Lease intangible assets, net' and 'Lease intangible liabilities, net' in the consolidated balance sheets. The December 31, 2019 balance sheet has been reclassified to match the current period classification. |
Supplemental Detail for Certa_2
Supplemental Detail for Certain Components of Consolidated Balance Sheets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Text Block Supplement [Abstract] | |
Schedule of acquired lease intangible assets, net | A. Lease intangible assets, net, consist of the following at: March 31, 2020 December 31, 2019 In-place leases $ 1,667,826 $ 1,612,153 Accumulated amortization of in-place leases (659,165 ) (627,676 ) Above-market leases 720,341 710,275 Accumulated amortization of above-market leases (212,183 ) (201,369 ) $ 1,516,819 $ 1,493,383 |
Schedule of other assets, net | B. Other assets, net, consist of the following at: March 31, 2020 December 31, 2019 Right of use asset - operating leases, net $ 119,648 $ 120,533 Right of use asset - financing leases 88,804 36,901 Restricted escrow deposits 82,391 4,529 Financing receivables 81,436 81,892 Derivative assets and receivables - at fair value 25,173 12 Prepaid expenses 16,113 11,839 Goodwill 14,397 14,430 Impounds related to mortgages payable 12,962 12,465 Credit facility origination costs, net 10,274 11,453 Corporate assets, net 5,534 5,251 Non-refundable escrow deposits 1,280 14,803 Value-added tax receivable — 9,682 Other items 2,238 4,871 $ 460,250 $ 328,661 |
Schedule of distributions payable | C. Distributions payable consist of the following declared distributions at: March 31, 2020 December 31, 2019 Common stock distributions $ 80,803 $ 76,622 Noncontrolling interests distributions 108 106 $ 80,911 $ 76,728 |
Schedule of accounts payable and accrued expenses | D. Accounts payable and accrued expenses consist of the following at: March 31, 2020 December 31, 2019 Derivative liabilities and payables - at fair value $ 67,944 $ 26,359 Notes payable - interest payable 62,709 75,114 Property taxes payable 16,478 18,626 Accrued income taxes 4,429 4,450 Value-added tax payable 4,301 13,434 Accrued costs on properties under development 3,325 5,870 Mortgages, term loans, credit line - interest payable and interest rate swaps 1,876 1,729 Other items 21,115 31,457 $ 182,177 $ 177,039 |
Schedule of acquired lease intangible liabilities, net | E. Lease intangible liabilities, net, consist of the following at: March 31, 2020 December 31, 2019 Below-market leases $ 449,445 $ 447,522 Accumulated amortization of below-market leases (120,697 ) (114,419 ) $ 328,748 $ 333,103 |
Schedule of other liabilities | F. Other liabilities consist of the following at: March 31, 2020 December 31, 2019 Lease liability - operating leases, net $ 121,790 $ 122,285 Rent received in advance and other deferred revenue 117,291 127,687 Security deposits 6,249 6,303 Lease liability - financing leases 6,023 5,946 $ 251,353 $ 262,221 |
Investments in Real Estate (Tab
Investments in Real Estate (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Real Estate Investments, Net [Abstract] | |
Schedule of acquisitions | Below is a summary of our acquisitions for the three months ended March 31, 2020 : Number of Properties Square Feet Investment Weighted Average Lease Term (Years) Initial Average Cash Lease Yield Three Months Ended March 31, 2020 (1) Acquisitions - U.S. (in 22 states) 54 1.4 $ 318.3 14.8 6.5 % Acquisitions - U.K. (2) 4 0.4 165.6 12.5 5.1 % Total Acquisitions 58 1.8 483.9 14.2 6.0 % Properties under Development - U.S. 7 0.2 2.1 10.6 7.5 % Total (3) 65 2.0 $ 486.0 14.1 6.0 % (1) None of our investments during the first three months of 2020 caused any one tenant to be 10% or more of our total assets at March 31, 2020 . All of our investments in acquired properties during the first three months of 2020 are 100% leased at the acquisition date. (2) Represents investments of £ 133.3 million Sterling during the three months ended March 31, 2020 converted at the applicable exchange rate on the date of acquisition. (3) The tenants occupying the new properties operate in 17 industries, and are 95.4% retail and 4.6% industrial, based on rental revenue. Approximately 36% of the rental revenue generated from acquisitions during the first three months of 2020 is from investment grade rated tenants, their subsidiaries or affiliated companies. Below is a summary of our acquisitions for the three months ended March 31, 2019: Number of Properties Square Feet Investment Weighted Average Lease Term (Years) Initial Average Cash Lease Yield Three months ended March 31, 2019 (1) Acquisitions - U.S. (in 25 states) 97 1.9 $ 508.6 17.0 6.7 % Properties under Development - U.S. 8 0.4 10.9 17.3 7.2 % Total (2) 105 2.3 $ 519.5 17.0 6.7 % (1) None of our investments during the first three months of 2019 caused any one tenant to be 10% or more of our total assets at March 31, 2019. All of our investments in acquired properties during the first three months of 2019 were 100% leased upon acquisition. (2) The tenants occupying the new properties operated in 14 industries, and the property types consisted of 98.7% retail and 1.3% industrial, based on rental revenue. Approximately 31% of the rental revenue generated from acquisitions during the first three months of 2019 was from investment grade rated tenants, their subsidiaries or affiliated companies. |
Schedule of future impact related to amortization of above-market, below-market and in-place lease intangibles | The following table presents the estimated impact during the next five years and thereafter related to the amortization of the above-market and below-market lease intangibles and the amortization of the in-place lease intangibles at March 31, 2020 (dollars in thousands): Net decrease to rental revenue Increase to amortization expense 2020 $ (17,775 ) $ 96,203 2021 (22,683 ) 120,617 2022 (21,135 ) 108,643 2023 (19,618 ) 96,339 2024 (18,031 ) 87,650 Thereafter (80,168 ) 499,209 Totals $ (179,410 ) $ 1,008,661 |
Mortgages Payable (Tables)
Mortgages Payable (Tables) - Mortgages Payable | 3 Months Ended |
Mar. 31, 2020 | |
Debt | |
Summary of mortgages payable | The following table summarizes our mortgages payable as of March 31, 2020 and December 31, 2019 , respectively (dollars in thousands): As Of Number of Properties (1) Weighted Average Stated Interest Rate (2) Weighted Average Effective Interest Rate (3) Weighted Average Remaining Years Until Maturity Remaining Principal Balance Unamortized Premium and Deferred Financing Costs Balance, net Mortgage Payable Balance 3/31/2020 92 4.9 % 4.7 % 2.9 $ 406,746 $ 1,412 $ 408,158 12/31/2019 92 4.9 % 4.6 % 3.1 $ 408,419 $ 1,700 $ 410,119 (1) At March 31, 2020 and December 31, 2019 , there were 27 mortgages on 92 properties. The mortgages require monthly payments with principal payments due at maturity. The mortgages were at fixed interest rates, except for one variable rate mortgage on one property, which has been swapped to a fixed interest rate, with a principal balance at March 31, 2020 and December 31, 2019 of $7.0 million and $7.1 million , respectively. (2) Stated interest rates ranged from 3.8% to 6.9% at each of March 31, 2020 and December 31, 2019 . (3) Effective interest rates ranged from 3.8% to 7.6% at each of March 31, 2020 and December 31, 2019 . |
Schedule of maturity of debt, net | The following table summarizes the maturity of mortgages payable, excluding net premiums of $2.6 million and deferred financing costs of $1.2 million , as of March 31, 2020 (dollars in millions): Year of Maturity Principal 2020 $ 82.6 2021 68.8 2022 111.8 2023 20.6 2024 112.1 Thereafter 10.8 Totals $ 406.7 |
Notes Payable (Tables)
Notes Payable (Tables) - Notes and bonds payable | 3 Months Ended |
Mar. 31, 2020 | |
Debt | |
Schedule of unsecured notes and bonds | Our senior unsecured notes and bonds consist of the following, sorted by maturity date (dollars in millions): March 31, 2020 December 31, 2019 5.750% notes, issued in June 2010 and due in January 2021 $ — $ 250 3.250% notes, $450 issued in October 2012 and $500 issued in December 2017, both due in October 2022 950 950 4.650% notes, issued in July 2013 and due in August 2023 750 750 3.875% notes, issued in June 2014 and due in July 2024 350 350 3.875% notes, issued in April 2018 and due in April 2025 500 500 4.125% notes, $250 issued in September 2014 and $400 issued in March 2017, both due in October 2026 650 650 3.000% notes, issued in October 2016 and due in January 2027 600 600 3.650% notes, issued in December 2017 and due in January 2028 550 550 3.250% notes, issued in June 2019 and due in June 2029 500 500 2.730% notes, issued in May 2019 and due in May 2034 (1) 391 418 5.875% bonds, $100 issued in March 2005 and $150 issued in June 2011, both due in March 2035 250 250 4.650% notes, $300 issued in March 2017 and $250 issued in December 2017, both due in March 2047 550 550 Total principal amount 6,041 6,318 Unamortized net original issuance premiums and deferred financing costs (28 ) (30 ) $ 6,013 $ 6,288 (1) Represents the principal balance (in U.S. dollars) of the Sterling-denominated private placement of £315.0 million converted at the applicable exchange rates on March 31, 2020 , and December 31, 2019 , respectively. |
Schedule of maturity of debt, net | The following table summarizes the maturity of our notes and bonds payable as of March 31, 2020 , excluding net unamortized original issuance premiums and deferred financing costs (dollars in millions): Year of Maturity Principal 2022 $ 950 2023 750 2024 350 Thereafter 3,991 Totals $ 6,041 |
Issuances of Common Stock (Tabl
Issuances of Common Stock (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Schedule of common stock issuances pursuant to our DRSPP program | The following table outlines common stock issuances pursuant to our DRSPP program (dollars in millions): Three Months Ended March 31, 2020 2019 Shares of common stock issued under the DRSPP program 34,000 31,898 Gross proceeds $ 2.4 $ 2.2 |
Noncontrolling Interests (Table
Noncontrolling Interests (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Noncontrolling Interest [Abstract] | |
Schedule of the change in the carrying value of all noncontrolling interests | The following table represents the change in the carrying value of all noncontrolling interests through March 31, 2020 (dollars in thousands): Realty Income, L.P. units (1) Other Noncontrolling Interests Total Carrying value at December 31, 2019 $ 24,596 $ 5,106 $ 29,702 Distributions (323 ) (71 ) (394 ) Allocation of net income 277 39 316 Carrying value at March 31, 2020 $ 24,550 $ 5,074 $ 29,624 (1) 242,007 units were issued on March 30, 2018, 131,790 units were issued on April 30, 2018, and 89,322 units were issued on March 28, 2019. 463,119 remained outstanding at each of March 31, 2020 and December 31, 2019 |
Summary selected financial data of consolidated VIEs | Below is a summary of selected financial data of consolidated VIEs included in the consolidated balance sheets at March 31, 2020 and December 31, 2019 (in thousands): March 31, 2020 December 31, 2019 Net real estate $ 647,877 $ 654,305 Total assets 737,990 744,394 Total liabilities 52,613 52,087 |
Financial Instruments and Fai_2
Financial Instruments and Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value by balance sheet groupings | We believe that the carrying values reflected in our consolidated balance sheets reasonably approximate the fair values for cash and cash equivalents, accounts receivable, escrow deposits, loans receivable, line of credit payable, term loans and all other liabilities, due to their short-term nature or interest rates and terms that are consistent with market, except for our mortgages payable assumed in connection with acquisitions and our senior notes and bonds payable, which are disclosed as follows (dollars in millions): March 31, 2020 Carrying value Estimated fair value Mortgages payable assumed in connection with acquisitions (1) $ 406.7 $ 410.3 Notes and bonds payable (2) 6,041.2 6,008.4 December 31, 2019 Carrying value Estimated fair value Mortgages payable assumed in connection with acquisitions (1) $ 408.4 $ 417.7 Notes and bonds payable (2) 6,317.6 6,826.1 (1) Excludes non-cash net premiums recorded on the mortgages payable. The unamortized balance of these net premiums was $2.6 million at March 31, 2020 , and $3.0 million at December 31, 2019 . Also excludes deferred financing costs of $1.2 million at March 31, 2020 and $1.3 million at December 31, 2019 . (2) Excludes non-cash original issuance premiums and discounts recorded on notes payable. The unamortized balance of the net original issuance premiums was $6.2 million at March 31, 2020 , and $6.3 million at December 31, 2019 . Also excludes deferred financing costs of $34.3 million at March 31, 2020 and $35.9 million at December 31, 2019 . |
Schedule of derivative financial instruments | The following table summarizes the terms and fair values of our derivative financial instruments at March 31, 2020 and December 31, 2019 (dollars in millions): Derivative Type Hedge Designation Notional Amount Strike Effective Date Maturity Date Fair Value - asset (liability) March 31, December 31, March 31 December 31, 2020 2019 2020 2019 Interest rate swap Cash flow $ 7.0 $ 7.0 6.03% 09/25/2012 09/03/2021 $ (0.3 ) $ (0.2 ) Interest rate swap Cash flow 250.0 250.0 1.72% 06/30/2015 06/30/2020 (0.6 ) (0.1 ) Interest rate swap Cash flow 250.0 250.0 3.04% 10/24/2018 03/24/2024 (25.3 ) (14.7 ) Cross-currency swap (1) Cash flow 41.6 41.6 (2) 05/20/2019 05/22/2034 6.9 (2.6 ) Cross-currency swap (1) Cash flow 41.6 41.6 (3) 05/20/2019 05/22/2034 6.4 (2.6 ) Cross-currency swap (1) Cash flow 41.6 41.6 (4) 05/20/2019 05/22/2034 6.0 (2.9 ) Cross-currency swap (1) Cash flow 41.6 41.6 (5) 05/20/2019 05/22/2034 5.8 (3.2 ) Treasury rate lock (6) Cash flow 75.0 — 1.63% (6) 06/30/2020 (6.9 ) — Treasury rate lock (6) Cash flow 75.0 — 1.63% (6) 06/30/2020 (6.9 ) — Treasury rate lock (6) Cash flow 100.0 — 1.64% (6) 06/30/2020 (9.2 ) — Treasury rate lock (6) Cash flow 100.0 — 1.57% (6) 06/30/2020 (8.6 ) — Treasury rate lock (6) Cash flow 150.0 — 1.37% (6) 06/30/2020 (10.0 ) — $ 1,173.4 $ 673.4 $ (42.7 ) $ (26.3 ) (1) Represents British Pound Sterling, or GBP, United States Dollar, or USD, cross-currency swap. (2) GBP fixed rates initially at 4.82% and escalating to 10.96% , and USD fixed rate at 9.800% . (3) GBP fixed rates initially at 4.82% and escalating to 10.96% , and USD fixed rate at 9.803% . (4) GBP fixed rates initially at 4.82% and escalating to 10.96% , and USD fixed rate at 9.745% . (5) GBP fixed rates initially at 4.82% and escalating to 10.96% , and USD fixed rate at 9.755% . (6) These treasury rate locks were entered into during February 2020 to hedge our exposure to the changes in the 10-year US treasury rate on potential future debt offerings during the first half of 2020. In the event we do not execute a debt offering or offerings within the original contract maturity, we may elect to extend the maturity of all or a portion of these contracts. |
Gain on Sales of Real Estate (T
Gain on Sales of Real Estate (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Gain (Loss) on Sale of Investments [Abstract] | |
Schedule of properties sold | The following table summarizes our properties sold during the periods indicated below (dollars in millions): Three Months Ended March 31, 2020 2019 Number of properties 17 19 Net sales proceeds $ 126.2 $ 22.5 Gain on sales of real estate $ 38.5 $ 7.3 |
Impairments (Tables)
Impairments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of provisions for impairment | The following table summarizes our provisions for impairment during the periods indicated below (dollars in millions): Three Months Ended March 31, 2020 2019 Total provisions for impairment $ 4.5 $ 4.7 Number of properties: Classified as held for sale 8 — Classified as held for investment 1 — Sold 7 11 |
Distributions Paid and Payable
Distributions Paid and Payable (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Dividends [Abstract] | |
Summary of monthly distributions paid | The following is a summary of monthly distributions paid per common share for the first three months of 2020 and 2019 : Month 2020 2019 January $ 0.2275 $ 0.2210 February 0.2325 0.2255 March 0.2325 0.2255 Total $ 0.6925 $ 0.6720 |
Net Income per Common Share (Ta
Net Income per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of the denominator of the basic net income per common share computation to the denominator of the diluted net income per common share computation | The following is a reconciliation of the denominator of the basic net income per common share computation to the denominator of the diluted net income per common share computation: Three Months Ended March 31, 2020 2019 Weighted average shares used for the basic net income per share computation 336,624,567 303,528,336 Incremental shares from share-based compensation 351,948 291,542 Weighted average shares used for diluted net income per share computation 336,976,515 303,819,878 Unvested shares from share-based compensation that were anti-dilutive 31,001 30,060 Weighted average partnership common units convertible to common shares that were anti-dilutive 463,119 377,767 |
Supplemental Disclosures of C_2
Supplemental Disclosures of Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of reconciliation of cash, cash equivalents and restricted cash | Per the requirements of ASU 2016-18 (Topic 230, Statement of Cash Flows ), the following table provides a reconciliation of cash and cash equivalents reported within the consolidated balance sheets to the total of the cash, cash equivalents and restricted cash reported within the consolidated statements of cash flows (dollars in thousands): March 31, 2020 March 31, 2019 Cash and cash equivalents shown in the consolidated balance sheets $ 41,804 $ 2,997 Restricted escrow deposits (1) 82,391 9,081 Impounds related to mortgages payable (1) 12,962 10,256 Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 137,157 $ 22,334 (1) Included within other assets, net on the consolidated balance sheets (see note 3). These amounts consist of cash that we are legally entitled to, but that is not immediately available to us. As a result, these amounts were considered restricted as of the dates presented. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of reconciliation of assets from segment to consolidated | The following tables set forth certain information regarding the properties owned by us, classified according to the business of the respective tenants (dollars in thousands): Assets, as of: March 31, 2020 December 31, 2019 Segment net real estate: Automotive service $ 286,380 $ 288,453 Automotive tire services 232,093 232,709 Beverages 278,318 279,373 Child care 217,120 208,326 Convenience stores 2,040,499 2,057,157 Dollar stores 1,430,852 1,427,950 Drug stores 1,603,799 1,618,854 Financial services 386,310 389,634 General merchandise 515,199 475,418 Grocery stores - U.S. (1) 911,070 922,349 Grocery stores - U.K. (1) 664,056 663,210 Health and fitness 1,092,881 1,019,796 Home improvement 503,092 495,305 Restaurants-casual dining 568,547 576,526 Restaurants-quick service 1,067,239 1,059,155 Theaters - U.S. (1) 869,621 878,103 Transportation services 720,929 769,614 Wholesale club 393,501 396,690 Other non-reportable segments 2,810,431 2,738,150 Total net real estate 16,591,937 16,496,772 Intangible assets: Automotive service 57,833 58,854 Automotive tire services 6,940 7,322 Beverages 1,444 1,509 Child care 22,805 21,997 Convenience stores 129,145 131,808 Dollar stores 81,755 82,701 Drug stores 179,585 183,319 Financial services 16,468 17,130 General merchandise 74,187 66,135 Grocery stores - U.S. (1) 176,030 180,197 Grocery stores - U.K. (1) 177,001 153,407 Health and fitness 74,257 74,428 Home improvement 73,939 72,979 Restaurants-casual dining 22,629 23,289 Restaurants-quick service 51,372 52,353 Theaters - U.S. (1) 35,029 36,089 Transportation services 58,957 66,055 Wholesale club 22,594 23,372 Other non-reportable segments 254,849 240,439 Other corporate assets 687,686 564,641 Total assets $ 18,796,442 $ 18,554,796 |
Schedule of reconciliation of revenue from segments to consolidated | Three months ended March 31, Revenue 2020 2019 Segment rental revenue: Automotive service $ 8,670 $ 7,213 Automotive tire services 7,833 7,777 Beverages 7,996 7,915 Child care 9,481 7,827 Convenience stores 46,733 41,214 Dollar stores 31,391 24,986 Drug stores 35,299 33,170 Financial services 7,543 7,718 General merchandise 11,316 6,911 Grocery stores - U.S. (1) 19,509 16,124 Grocery stores - U.K. (1) 10,405 — Health and fitness 28,278 26,225 Home improvement 11,309 9,815 Restaurants-casual dining 12,538 11,290 Restaurants-quick service 23,308 21,730 Theaters - U.S. (1) 24,567 17,656 Transportation services 16,187 16,026 Wholesale club 9,588 9,593 Other non-reportable segments and tenant reimbursements 90,206 80,847 Rental (including reimbursable) 412,157 354,037 Other 2,184 328 Total revenue $ 414,341 $ 354,365 (1) Our investments in industries outside of the U.S. are managed as separate operating segments. |
Basis of Presentation - Narrati
Basis of Presentation - Narrative (Details) ft² in Millions | Mar. 31, 2020ft²stateproperty |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of properties owned | property | 6,525 |
Number of U.S. states where properties are owned (states) | state | 49 |
Leasable square feet (sq ft) | ft² | 106 |
Supplemental Detail for Certa_3
Supplemental Detail for Certain Components of Consolidated Balance Sheets - Lease Intangible Assets, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Lease intangible assets, net | ||
Total acquired lease intangible assets, net | $ 1,516,819 | $ 1,493,383 |
In-place leases | ||
Lease intangible assets, net | ||
Lease intangible assets, gross | 1,667,826 | 1,612,153 |
Accumulated amortization of lease intangible assets | (659,165) | (627,676) |
Above-market leases | ||
Lease intangible assets, net | ||
Lease intangible assets, gross | 720,341 | 710,275 |
Accumulated amortization of lease intangible assets | $ (212,183) | $ (201,369) |
Supplemental Detail for Certa_4
Supplemental Detail for Certain Components of Consolidated Balance Sheets - Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Jan. 01, 2019 |
Other assets, net | ||||
Right of use asset - operating leases, net | $ 132,000 | |||
Restricted escrow deposits | $ 82,391 | $ 4,529 | $ 9,081 | |
Financing receivables | 81,436 | 81,892 | ||
Derivative assets and receivables - at fair value | 25,173 | 12 | ||
Prepaid expenses | 16,113 | 11,839 | ||
Goodwill | 14,397 | 14,430 | ||
Impounds related to mortgages payable | 12,962 | 12,465 | $ 10,256 | |
Credit facility origination costs, net | 10,274 | 11,453 | ||
Corporate assets, net | 5,534 | 5,251 | ||
Non-refundable escrow deposits | 1,280 | 14,803 | ||
Value-added tax receivable | 0 | 9,682 | ||
Other items | 2,238 | 4,871 | ||
Total other assets, net | 460,250 | 328,661 | ||
Other assets, net | ||||
Other assets, net | ||||
Right of use asset - operating leases, net | 119,648 | 120,533 | ||
Right of use asset - financing leases | $ 88,804 | $ 36,901 |
Supplemental Detail for Certa_5
Supplemental Detail for Certain Components of Consolidated Balance Sheets - Distributions Payable (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Distributions payable | ||
Distributions payable | $ 80,911 | $ 76,728 |
Noncontrolling interests | ||
Distributions payable | ||
Distributions payable | 108 | 106 |
Common stock | ||
Distributions payable | ||
Distributions payable | $ 80,803 | $ 76,622 |
Supplemental Detail for Certa_6
Supplemental Detail for Certain Components of Consolidated Balance Sheets - Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Accounts payable and accrued expenses consist of the following at: | ||
Property taxes payable | $ 16,478 | $ 18,626 |
Accrued income taxes | 4,429 | 4,450 |
Value-added tax payable | 4,301 | 13,434 |
Accrued costs on properties under development | 3,325 | 5,870 |
Other items | 21,115 | 31,457 |
Total accounts payable and accrued expenses | 182,177 | 177,039 |
Notes payable | ||
Accounts payable and accrued expenses consist of the following at: | ||
Derivative liabilities and payables - at fair value | 67,944 | 26,359 |
Interest payable | 62,709 | 75,114 |
Mortgages, term loans, and credit line | ||
Accounts payable and accrued expenses consist of the following at: | ||
Interest payable | $ 1,876 | $ 1,729 |
Supplemental Detail for Certa_7
Supplemental Detail for Certain Components of Consolidated Balance Sheets - Lease Intangible Liabilities, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Lease intangible liabilities, net, consist of the following at: | ||
Below-market leases | $ 449,445 | $ 447,522 |
Accumulated amortization of below-market leases | (120,697) | (114,419) |
Total lease intangible liabilities, net | $ 328,748 | $ 333,103 |
Supplemental Detail for Certa_8
Supplemental Detail for Certain Components of Consolidated Balance Sheets - Other Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 |
Other liabilities consist of the following at: | |||
Lease liability - operating leases, net | $ 121,790 | $ 122,285 | $ 132,000 |
Rent received in advance and other deferred revenue | 117,291 | 127,687 | |
Security deposits | 6,249 | 6,303 | |
Lease liability - financing leases | 6,023 | 5,946 | |
Total other liabilities | $ 251,353 | $ 262,221 |
Investments in Real Estate - Sc
Investments in Real Estate - Schedule of Acquisitions (Details) £ in Millions, ft² in Millions, $ in Millions | 3 Months Ended | |||
Mar. 31, 2020GBP (£)ft²stateproperty | Mar. 31, 2020USD ($)ft²stateproperty | Mar. 31, 2019USD ($)ft²property | Dec. 31, 2019 | |
Real Estate [Line Items] | ||||
Number of properties | property | 65 | 65 | 105 | |
Square feet (sq ft) | ft² | 2 | 2 | 2.3 | |
Investment | $ | $ 486 | $ 519.5 | ||
Weighted average lease term (years) | 14 years 1 month 6 days | 14 years 1 month 6 days | 17 years | |
Initial average cash lease yield (percent) | 6.00% | 6.00% | 6.70% | |
New properties | ||||
Real Estate [Line Items] | ||||
Number of properties, new | property | 58 | 58 | ||
Square feet (sq ft) | ft² | 1.8 | 1.8 | ||
Investment | $ | $ 483.9 | |||
Weighted average lease term (years) | 14 years 2 months 12 days | 14 years 2 months 12 days | ||
Initial average cash lease yield (percent) | 6.00% | 6.00% | ||
New properties | U.S. | ||||
Real Estate [Line Items] | ||||
Number of properties, new | property | 54 | 54 | 97 | |
Number of states | 22 | 22 | 25 | |
Square feet (sq ft) | ft² | 1.4 | 1.4 | 1.9 | |
Investment | $ | $ 318.3 | $ 508.6 | ||
Weighted average lease term (years) | 14 years 9 months 18 days | 14 years 9 months 18 days | 17 years | |
Initial average cash lease yield (percent) | 6.50% | 6.50% | 6.70% | |
New properties | U.K. | ||||
Real Estate [Line Items] | ||||
Number of properties, new | property | 4 | 4 | ||
Square feet (sq ft) | ft² | 0.4 | 0.4 | ||
Investment | £ 133.3 | $ 165.6 | ||
Weighted average lease term (years) | 12 years 6 months | 12 years 6 months | ||
Initial average cash lease yield (percent) | 5.10% | 5.10% | ||
Properties under development | U.S. | ||||
Real Estate [Line Items] | ||||
Number of properties, under development | property | 7 | 7 | 8 | |
Square feet (sq ft) | ft² | 0.2 | 0.2 | 0.4 | |
Investment | $ | $ 2.1 | $ 10.9 | ||
Weighted average lease term (years) | 10 years 7 months 6 days | 10 years 7 months 6 days | 17 years 3 months 18 days | |
Initial average cash lease yield (percent) | 7.50% | 7.50% | 7.20% |
Investments in Real Estate - Ac
Investments in Real Estate - Acquisitions Narrative (Details) £ in Millions | 3 Months Ended | |||||
Mar. 31, 2020GBP (£)property_investmentindustry | Mar. 31, 2020USD ($)property_investmentindustry | Mar. 31, 2019USD ($)property_investmentindustry | Dec. 31, 2019USD ($) | Jan. 01, 2019USD ($) | Sep. 30, 2018 | |
Investments in real estate properties | ||||||
Number of investments in properties that caused any tenant to be 10% of more of total assets | property_investment | 0 | 0 | 0 | |||
Rental revenue generated from acquisitions from investment grade tenants (as a percent) | 36.00% | 36.00% | 31.00% | |||
Value of properties acquired during the period | $ 486,000,000 | $ 519,500,000 | ||||
Right-of-use assets | $ 132,000,000 | |||||
Property investments allocated to right-of-use assets | $ 56,900,000 | |||||
Industrial | ||||||
Investments in real estate properties | ||||||
Property type acquired based on rental revenue (as a percent) | 4.60% | 4.60% | 1.30% | |||
Land | ||||||
Investments in real estate properties | ||||||
Right-of-use assets | $ 7,400,000 | |||||
New and under development | ||||||
Investments in real estate properties | ||||||
Leased area (as a percent) | 100.00% | 100.00% | ||||
New properties | ||||||
Investments in real estate properties | ||||||
Number of industries in which tenants operate | industry | 17 | 17 | 14 | |||
Value of properties acquired during the period | $ 483,900,000 | |||||
New properties | Retail | ||||||
Investments in real estate properties | ||||||
Property type acquired based on rental revenue (as a percent) | 95.40% | 95.40% | 98.70% | |||
Real Estate Investment | ||||||
Investments in real estate properties | ||||||
Value of properties acquired during the period | $ 486,000,000 | $ 519,500,000 | ||||
Property investments allocated to land | 70,200,000 | 121,100,000 | ||||
Property investments allocated to buildings and improvements | 295,900,000 | 329,200,000 | ||||
Property investments allocated to lease-related intangible assets | 64,800,000 | 52,400,000 | ||||
Property investments allocated to financing receivables | 508,000 | 26,300,000 | ||||
Property investments allocated to lease-related intangible liabilities | 1,400,000 | 9,500,000 | ||||
Property investments allocated to lease liabilities under ground leases | 934,000 | |||||
Contingent consideration associated with acquisition | 0 | $ 0 | ||||
Revenue generated from acquired properties during the period | 3,900,000 | 3,500,000 | ||||
Net income generated from acquired properties during the period | 1,200,000 | $ 1,800,000 | ||||
U.K. | New properties | ||||||
Investments in real estate properties | ||||||
Value of properties acquired during the period | £ 133.3 | $ 165,600,000 |
Investments in Real Estate - In
Investments in Real Estate - Investments in Existing Properties (Details) - Investments in existing properties - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Investments in real estate properties | ||
Improvements | $ 2,100 | $ 3,000 |
Re-leasing costs | 138 | 323 |
Recurring capital expenditures | 56 | |
Nonrecurring building improvements | $ 2,000 | $ 2,600 |
Investments in Real Estate - Pr
Investments in Real Estate - Properties with Existing Leases Narrative (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2020USD ($)property | Mar. 31, 2019USD ($)property | |
Real Estate Properties [Line Items] | ||
Value of properties acquired during the period | $ 486 | $ 519.5 |
Number of properties acquired during the period | property | 65 | 105 |
Rental Revenue | ||
Real Estate Properties [Line Items] | ||
Amortization of above and below market Leases | $ 8.2 | $ 3.4 |
In-place leases | ||
Real Estate Properties [Line Items] | ||
Depreciation and amortization expense | 32.6 | 26 |
Real Estate Investment | ||
Real Estate Properties [Line Items] | ||
Value of properties acquired during the period | 486 | 519.5 |
Real Estate Investment | Properties with existing leases | In-place leases | ||
Real Estate Properties [Line Items] | ||
Value of properties acquired during the period | $ 363 | $ 258 |
Number of properties acquired during the period | property | 39 | 53 |
Investments in Real Estate - Es
Investments in Real Estate - Estimated Impact of Amortization of Lease Intangibles (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Net decrease to rental revenue | |
2020 | $ (17,775) |
2021 | (22,683) |
2022 | (21,135) |
2023 | (19,618) |
2024 | (18,031) |
Thereafter | (80,168) |
Totals | (179,410) |
Increase to amortization expense | |
2020 | 96,203 |
2021 | 120,617 |
2022 | 108,643 |
2023 | 96,339 |
2024 | 87,650 |
Thereafter | 499,209 |
Totals | $ 1,008,661 |
Credit Facility - Narrative (De
Credit Facility - Narrative (Details) £ in Millions | Apr. 09, 2020USD ($) | Mar. 31, 2020USD ($)extension | Mar. 31, 2019USD ($)currency | May 01, 2020GBP (£) | May 01, 2020USD ($) | Dec. 31, 2019GBP (£) | Dec. 31, 2019USD ($) |
Credit facility | |||||||
Credit facility origination costs | $ 10,274,000 | $ 11,453,000 | |||||
Outstanding balance | 615,176,000 | 704,335,000 | |||||
Borrowings on line of credit | 846,532,000 | $ 732,000,000 | |||||
Cash and cash equivalents | 41,804,000 | $ 2,997,000 | 54,011,000 | ||||
Unsecured debt | Revolving Credit Facility | |||||||
Credit facility | |||||||
Maximum borrowing capacity | $ 3,000,000,000 | ||||||
Number of extensions | extension | 2 | ||||||
Term of extension option | 6 months | ||||||
Number of currencies allowable per facility | currency | 14 | ||||||
Credit facility expansion option | $ 1,000,000,000 | ||||||
Current borrowing capacity | 2,400,000,000 | ||||||
Outstanding balance | $ 615,200,000 | £ 169.2 | $ 704,300,000 | ||||
Weighted average borrowing rate during the period (as a percent) | 2.10% | 3.30% | |||||
Weighted average interest rate at the end of the period (as a percent) | 1.30% | 2.20% | 2.20% | ||||
Unsecured debt | Revolving Credit Facility | Other assets, net | |||||||
Credit facility | |||||||
Credit facility origination costs | $ 10,300,000 | $ 11,500,000 | |||||
Unsecured debt | Revolving Credit Facility | LIBOR | |||||||
Credit facility | |||||||
Basis spread on variable rate (as a percent) | 0.775% | ||||||
Commitment fee (as a percent) | 0.125% | ||||||
All-in drawn variable interest rate (as a percent) | 0.90% | ||||||
Subsequent event | |||||||
Credit facility | |||||||
Cash and cash equivalents | $ 1,250,000,000 | ||||||
Subsequent event | Unsecured debt | Revolving Credit Facility | |||||||
Credit facility | |||||||
Credit facility expansion option | $ 1,000,000,000 | ||||||
Current borrowing capacity | 1,100,000,000 | ||||||
Outstanding balance | £ 325.5 | $ 1,900,000,000 | |||||
Borrowings on line of credit | $ 1,200,000,000 |
Term Loans - Narrative (Details
Term Loans - Narrative (Details) - Term Loans - USD ($) | 1 Months Ended | |||
Oct. 31, 2018 | Jun. 30, 2015 | Mar. 31, 2020 | Dec. 31, 2019 | |
Debt | ||||
Deferred finance costs balance | $ 849,000 | $ 956,000 | ||
$250 million senior unsecured term loan due March 2024 | ||||
Debt | ||||
Face amount of loan | $ 250,000,000 | |||
Effective yield (as a percent) | 3.89% | |||
Deferred financing costs incurred | $ 1,100,000 | |||
$250 million senior unsecured term loan due March 2024 | LIBOR | ||||
Debt | ||||
Basis spread on variable rate (as a percent) | 0.85% | |||
$250 million senior unsecured term loan due June 2020 | ||||
Debt | ||||
Face amount of loan | $ 250,000,000 | |||
Effective yield (as a percent) | 2.62% | |||
Deferred financing costs incurred | $ 1,200,000 | |||
$250 million senior unsecured term loan due June 2020 | LIBOR | ||||
Debt | ||||
Basis spread on variable rate (as a percent) | 0.90% |
Mortgages Payable - Narrative (
Mortgages Payable - Narrative (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020USD ($)mortgage | Mar. 31, 2019USD ($)mortgage | Dec. 31, 2019USD ($) | |
Debt | |||
Principal payments on mortgages payable | $ 1,673 | $ 1,235 | |
Number of mortgages assumed | mortgage | 0 | ||
Mortgages Payable | |||
Debt | |||
Principal payments on mortgages payable | $ 1,700 | $ 1,200 | |
Number of mortgages assumed | mortgage | 0 | ||
Unamortized net premiums | 2,600 | ||
Deferred financing costs | $ 1,200 | $ 1,300 |
Mortgages Payable - Summary of
Mortgages Payable - Summary of Mortgages Payable (Details) - Mortgages Payable $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020USD ($)mortgageproperty | Dec. 31, 2019USD ($)mortgageproperty | |
Debt | ||
Number of Properties | property | 92 | 92 |
Weighted Average Stated Interest Rate (as a percent) | 4.90% | 4.90% |
Weighted Average Effective Interest Rate (as a percent) | 4.70% | 4.60% |
Weighted Average Remaining Years Until Maturity | 2 years 10 months 24 days | 3 years 1 month 6 days |
Remaining Principal Balance | $ 406,746 | $ 408,419 |
Unamortized Premium and Deferred Finance Costs Balance, net | 1,412 | 1,700 |
Net payable amount | $ 408,158 | $ 410,119 |
Debt Instrument Number | mortgage | 27 | 27 |
Minimum | ||
Debt | ||
Weighted Average Effective Interest Rate (as a percent) | 3.80% | 3.80% |
Debt Instrument, Interest Rate, Stated Percentage | 3.80% | 3.80% |
Maximum | ||
Debt | ||
Weighted Average Effective Interest Rate (as a percent) | 7.60% | 7.60% |
Debt Instrument, Interest Rate, Stated Percentage | 6.90% | 6.90% |
Variable Rate Mortgages [Member] | ||
Debt | ||
Number of Properties | property | 1 | 1 |
Remaining Principal Balance | $ 7,000 | $ 7,100 |
Debt Instrument Number | mortgage | 1 | 1 |
Mortgages Payable - Summary o_2
Mortgages Payable - Summary of Maturities (Details) - Mortgages Payable - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Maturity of mortgages payable | ||
2020 | $ 82,600 | |
2021 | 68,800 | |
2022 | 111,800 | |
2023 | 20,600 | |
2024 | 112,100 | |
Thereafter | 10,800 | |
Totals | $ 406,746 | $ 408,419 |
Notes Payable - Narrative (Deta
Notes Payable - Narrative (Details) - Notes and bonds payable | 3 Months Ended |
Mar. 31, 2020 | |
Debt | |
Weighted average interest rate (as a percent) | 3.80% |
Weighted average remaining years until maturity | 8 years 3 months 18 days |
Notes Payable - General (Detail
Notes Payable - General (Details) - Notes and bonds payable £ in Millions | Mar. 31, 2020GBP (£) | Mar. 31, 2020USD ($) | Jan. 31, 2020 | Dec. 31, 2019USD ($) | Dec. 31, 2017USD ($) | Mar. 31, 2017USD ($) | Sep. 30, 2014USD ($) | Oct. 31, 2012USD ($) | Jun. 30, 2011USD ($) | Mar. 31, 2005USD ($) |
Debt | ||||||||||
Total principal amount | $ 6,041,000,000 | $ 6,318,000,000 | ||||||||
Unamortized net original issuance premiums and deferred financing costs | (28,000,000) | (30,000,000) | ||||||||
Net payable amount | 6,013,000,000 | 6,288,000,000 | ||||||||
5.750% notes, issued in June 2010 and due in January 2021 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 0 | $ 250,000,000 | ||||||||
Interest rate (as a percent) | 5.75% | 5.75% | 5.75% | 5.75% | ||||||
3.250% notes, $450 issued in October 2012 and $500 issued in December 2017, both due in October 2022 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 950,000,000 | $ 950,000,000 | ||||||||
Interest rate (as a percent) | 3.25% | 3.25% | 3.25% | |||||||
3.250% notes, issued in October 2012 and due in October 2022 | ||||||||||
Debt | ||||||||||
Face amount of notes | $ 450,000,000 | |||||||||
3.250% notes, issued in December 2017 and due in October 2022 | ||||||||||
Debt | ||||||||||
Face amount of notes | $ 500,000,000 | |||||||||
4.650% notes, issued in July 2013 and due in August 2023 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 750,000,000 | $ 750,000,000 | ||||||||
Interest rate (as a percent) | 4.65% | 4.65% | 4.65% | |||||||
3.875% notes, issued in June 2014 and due in July 2024 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 350,000,000 | $ 350,000,000 | ||||||||
Interest rate (as a percent) | 3.875% | 3.875% | 3.875% | |||||||
3.875% notes, issued in April 2018 and due in April 2025 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 500,000,000 | $ 500,000,000 | ||||||||
Interest rate (as a percent) | 3.875% | 3.875% | 3.875% | |||||||
4.125% notes, $250 issued in September 2014 and $400 issued in March 2017, both due in October 2026 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 650,000,000 | $ 650,000,000 | ||||||||
Interest rate (as a percent) | 4.125% | 4.125% | 4.125% | |||||||
4.125% notes, issued in September 2014 and due in October 2026 | ||||||||||
Debt | ||||||||||
Face amount of notes | $ 250,000,000 | |||||||||
4.125% notes, issued in March 2017 and due in October 2026 | ||||||||||
Debt | ||||||||||
Face amount of notes | $ 400,000,000 | |||||||||
3.000% notes, issued in October 2016 and due in January 2027 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 600,000,000 | $ 600,000,000 | ||||||||
Interest rate (as a percent) | 3.00% | 3.00% | 3.00% | |||||||
3.650% notes, issued in December 2017 and due in January 2028 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 550,000,000 | $ 550,000,000 | ||||||||
Interest rate (as a percent) | 3.65% | 3.65% | 3.65% | |||||||
3.250% notes, issued in June 2019 and due in June 2029 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 500,000,000 | $ 500,000,000 | ||||||||
Interest rate (as a percent) | 3.25% | 3.25% | 3.25% | |||||||
2.730% notes, issued in May 2019 and due in May 2034 | ||||||||||
Debt | ||||||||||
Total principal amount | £ 315 | $ 391,000,000 | $ 418,000,000 | |||||||
Interest rate (as a percent) | 2.73% | 2.73% | 2.73% | |||||||
5.875% bonds, $100 issued in March 2005 and $150 issued in June 2011, both due in March 2035 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 250,000,000 | $ 250,000,000 | ||||||||
Interest rate (as a percent) | 5.875% | 5.875% | 5.875% | |||||||
5.875% bonds, issued in March 2005 and due in March 2035 | ||||||||||
Debt | ||||||||||
Face amount of notes | $ 100,000,000 | |||||||||
5.875% bonds, issued in June 2011 and due in March 2035 | ||||||||||
Debt | ||||||||||
Face amount of notes | $ 150,000,000 | |||||||||
4.650% notes, $300 issued in March 2017 and $250 issued in December 2017, both due in March 2047 | ||||||||||
Debt | ||||||||||
Total principal amount | $ 550,000,000 | $ 550,000,000 | ||||||||
Interest rate (as a percent) | 4.65% | 4.65% | 4.65% | |||||||
4.650% notes, issued in March 2017 and due in March 2047 | ||||||||||
Debt | ||||||||||
Face amount of notes | $ 300,000,000 | |||||||||
4.650% notes, issued in December 2017 and due in March 2047 | ||||||||||
Debt | ||||||||||
Face amount of notes | $ 250,000,000 |
Notes Payable - Maturities (Det
Notes Payable - Maturities (Details) - Notes and bonds payable - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Maturity of notes and bonds payable | ||
2022 | $ 950 | |
2023 | 750 | |
2024 | 350 | |
Thereafter | 3,991 | |
Totals | $ 6,041 | $ 6,318 |
Notes Payable - Note Repayment
Notes Payable - Note Repayment (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Debt | ||||
Principal payments on notes payable | $ 250,000 | $ 0 | ||
Loss on extinguishment of debt | $ 9,819 | $ 0 | ||
Notes payable | 5.750% notes, issued in June 2010 and due in January 2021 | ||||
Debt | ||||
Principal payments on notes payable | $ 250,000 | |||
Interest rate (as a percent) | 5.75% | 5.75% | 5.75% | |
Loss on extinguishment of debt | $ 9,800 |
Issuances of Common Stock - Iss
Issuances of Common Stock - Issuance of Common Stock in Underwritten Public Offering (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | |
Class of Stock [Line Items] | |||
Proceeds from share issuances, net | $ 728,883 | $ 0 | |
Common stock | Underwritten Public Offering | |||
Class of Stock [Line Items] | |||
Shares of common stock issued (in shares) | 9,690,500 | ||
Underwriting discounts and other offering costs | $ 21,500 | ||
Proceeds from share issuances, net | $ 728,500 | ||
Common stock | Underwriter Option | |||
Class of Stock [Line Items] | |||
Shares of common stock issued (in shares) | 690,500 |
Issuances of Common Stock - Div
Issuances of Common Stock - Dividend Reinvestment and Stock Purchase Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Dividend Reinvestment and Stock Purchase Plan | ||
Gross proceeds | $ 2,366 | $ 2,164 |
Dividend Reinvestment and Stock Purchase Plan | ||
Dividend Reinvestment and Stock Purchase Plan | ||
Common shares authorized for future issuance (in shares) | 26,000,000 | |
Common shares remaining for future issuance (in shares) | 11,618,668 | |
Common stock | Dividend Reinvestment and Stock Purchase Plan | ||
Dividend Reinvestment and Stock Purchase Plan | ||
Shares of common stock issued (in shares) | 34,000 | 31,898 |
Gross proceeds | $ 2,400 | $ 2,200 |
Issuances of Common Stock - At-
Issuances of Common Stock - At-the-Market (ATM) Program (Details) | Mar. 31, 2020shares |
ATM Program | |
At-the-Market (ATM) Program | |
Common shares authorized for future issuance (in shares) | 33,402,405 |
Noncontrolling Interests - Narr
Noncontrolling Interests - Narrative (Details) | Mar. 31, 2020noncontrolling_interest |
Noncontrolling Interest [Abstract] | |
Number of noncontrolling interests consolidated | 2 |
Noncontrolling Interests - Chan
Noncontrolling Interests - Change in Carrying Value (Details) - USD ($) $ in Thousands | 3 Months Ended | |||||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Mar. 28, 2019 | Apr. 30, 2018 | Mar. 30, 2018 | |
Change in the carrying value of all noncontrolling interests | ||||||
Carrying value at beginning of the period | $ 29,702 | |||||
Allocation of net income | 316 | $ 288 | ||||
Carrying value at end of the period | $ 29,624 | |||||
Realty Income, L.P. | ||||||
Change in the carrying value of all noncontrolling interests | ||||||
Number of partnership units issued (in units) | 89,322 | 89,322 | 131,790 | 242,007 | ||
Number of partnership units outstanding (in units) | 463,119 | 463,119 | ||||
Noncontrolling interests | ||||||
Change in the carrying value of all noncontrolling interests | ||||||
Carrying value at beginning of the period | $ 29,702 | |||||
Distributions | (394) | |||||
Allocation of net income | 316 | |||||
Carrying value at end of the period | 29,624 | |||||
Noncontrolling interests | Realty Income, L.P. | ||||||
Change in the carrying value of all noncontrolling interests | ||||||
Carrying value at beginning of the period | 24,596 | |||||
Distributions | (323) | |||||
Allocation of net income | 277 | |||||
Carrying value at end of the period | 24,550 | |||||
Noncontrolling interests | Other Noncontrolling Interests | ||||||
Change in the carrying value of all noncontrolling interests | ||||||
Carrying value at beginning of the period | 5,106 | |||||
Distributions | (71) | |||||
Allocation of net income | 39 | |||||
Carrying value at end of the period | $ 5,074 |
Noncontrolling Interests - Vari
Noncontrolling Interests - Variable Interest Entities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Variable interest entity | ||
Net real estate | $ 16,570,581 | $ 16,399,997 |
Total assets | 18,796,442 | 18,554,796 |
Total liabilities | 8,378,803 | 8,750,638 |
Primary Beneficiary | ||
Variable interest entity | ||
Net real estate | 647,877 | 654,305 |
Total assets | 737,990 | 744,394 |
Total liabilities | $ 52,613 | $ 52,087 |
Financial Instruments and Fai_3
Financial Instruments and Fair Value Measurements - Summary or Fair Value (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Carrying value | ||
Fair value of financial assets and liabilities | ||
Mortgages payable assumed in connection with acquisitions | $ 406.7 | $ 408.4 |
Notes and bonds payable | 6,041.2 | 6,317.6 |
Estimated fair value | ||
Fair value of financial assets and liabilities | ||
Mortgages payable assumed in connection with acquisitions | 410.3 | 417.7 |
Notes and bonds payable | 6,008.4 | 6,826.1 |
Mortgages Payable | ||
Fair value of financial assets and liabilities | ||
Unamortized balance of non-cash net premiums | 2.6 | 3 |
Remaining balance of deferred financing costs at period end | 1.2 | 1.3 |
Notes and bonds payable | ||
Fair value of financial assets and liabilities | ||
Unamortized balance of non-cash net premiums | 6.2 | 6.3 |
Remaining balance of deferred financing costs at period end | $ 34.3 | $ 35.9 |
Financial Instruments and Fai_4
Financial Instruments and Fair Value Measurements - Derivative Financial Instruments (Details) - Designated as hedging instrument - Cash flow hedge - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Derivative [Line Items] | ||
Notional Amount | $ 1,173.4 | $ 673.4 |
Fair Value - asset (liability) | (42.7) | (26.3) |
Interest rate swap, maturity Sep 2021 | ||
Derivative [Line Items] | ||
Notional Amount | $ 7 | 7 |
Strike (percent) | 6.03% | |
Fair Value - asset (liability) | $ (0.3) | (0.2) |
Interest rate swap, maturity Jun 2020 | ||
Derivative [Line Items] | ||
Notional Amount | $ 250 | 250 |
Strike (percent) | 1.72% | |
Fair Value - asset (liability) | $ (0.6) | (0.1) |
Interest rate swap, maturity Mar 2024 | ||
Derivative [Line Items] | ||
Notional Amount | $ 250 | 250 |
Strike (percent) | 3.04% | |
Fair Value - asset (liability) | $ (25.3) | (14.7) |
Cross-currency swap, maturity May 2034 1 | ||
Derivative [Line Items] | ||
Notional Amount | 41.6 | 41.6 |
Fair Value - asset (liability) | $ 6.9 | (2.6) |
Cross-currency swap, maturity May 2034 1 | GBP | Minimum | ||
Derivative [Line Items] | ||
Strike (percent) | 4.82% | |
Cross-currency swap, maturity May 2034 1 | GBP | Maximum | ||
Derivative [Line Items] | ||
Strike (percent) | 10.96% | |
Cross-currency swap, maturity May 2034 1 | USD | ||
Derivative [Line Items] | ||
Strike (percent) | 9.80% | |
Cross-currency swap, maturity May 2034 2 | ||
Derivative [Line Items] | ||
Notional Amount | $ 41.6 | 41.6 |
Fair Value - asset (liability) | $ 6.4 | (2.6) |
Cross-currency swap, maturity May 2034 2 | GBP | Minimum | ||
Derivative [Line Items] | ||
Strike (percent) | 4.82% | |
Cross-currency swap, maturity May 2034 2 | GBP | Maximum | ||
Derivative [Line Items] | ||
Strike (percent) | 10.96% | |
Cross-currency swap, maturity May 2034 2 | USD | ||
Derivative [Line Items] | ||
Strike (percent) | 9.803% | |
Cross-currency swap, maturity May 2034 3 | ||
Derivative [Line Items] | ||
Notional Amount | $ 41.6 | 41.6 |
Fair Value - asset (liability) | $ 6 | (2.9) |
Cross-currency swap, maturity May 2034 3 | GBP | Minimum | ||
Derivative [Line Items] | ||
Strike (percent) | 4.82% | |
Cross-currency swap, maturity May 2034 3 | GBP | Maximum | ||
Derivative [Line Items] | ||
Strike (percent) | 10.96% | |
Cross-currency swap, maturity May 2034 3 | USD | ||
Derivative [Line Items] | ||
Strike (percent) | 9.745% | |
Cross-currency swap, maturity May 2034 4 | ||
Derivative [Line Items] | ||
Notional Amount | $ 41.6 | 41.6 |
Fair Value - asset (liability) | $ 5.8 | (3.2) |
Cross-currency swap, maturity May 2034 4 | GBP | Minimum | ||
Derivative [Line Items] | ||
Strike (percent) | 4.82% | |
Cross-currency swap, maturity May 2034 4 | GBP | Maximum | ||
Derivative [Line Items] | ||
Strike (percent) | 10.96% | |
Cross-currency swap, maturity May 2034 4 | USD | ||
Derivative [Line Items] | ||
Strike (percent) | 9.755% | |
Treasury rate lock, maturity Jun 2020 1 | ||
Derivative [Line Items] | ||
Notional Amount | $ 75 | 0 |
Strike (percent) | 1.63% | |
Fair Value - asset (liability) | $ (6.9) | 0 |
Treasury rate lock, maturity Jun 2020 2 | ||
Derivative [Line Items] | ||
Notional Amount | $ 75 | 0 |
Strike (percent) | 1.63% | |
Fair Value - asset (liability) | $ (6.9) | 0 |
Treasury rate lock, maturity Jun 2020 3 | ||
Derivative [Line Items] | ||
Notional Amount | $ 100 | 0 |
Strike (percent) | 1.64% | |
Fair Value - asset (liability) | $ (9.2) | 0 |
Treasury rate lock, maturity Jun 2020 4 | ||
Derivative [Line Items] | ||
Notional Amount | $ 100 | 0 |
Strike (percent) | 1.57% | |
Fair Value - asset (liability) | $ (8.6) | 0 |
Treasury rate lock, maturity Jun 2020 5 | ||
Derivative [Line Items] | ||
Notional Amount | $ 150 | 0 |
Strike (percent) | 1.37% | |
Fair Value - asset (liability) | $ (10) | $ 0 |
Financial Instruments and Fai_5
Financial Instruments and Fair Value Measurements - Derivative Narrative (Details) $ in Thousands, £ in Millions | 3 Months Ended | ||||
Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Feb. 29, 2020USD ($)derivative | May 31, 2019GBP (£)derivative | May 31, 2019USD ($)derivative | |
Treasury rate locks | Cash flow hedge | |||||
Derivative [Line Items] | |||||
Number of derivative instruments | derivative | 5 | ||||
Aggregate notional amount | $ 500,000 | ||||
Cross-currency swaps | Cash flow hedge | |||||
Derivative [Line Items] | |||||
Number of derivative instruments | derivative | 4 | 4 | |||
Aggregate notional amount | £ 130 | $ 166,000 | |||
Cross-currency swaps | Foreign exchange gains | |||||
Derivative [Line Items] | |||||
Unrealized gains (losses) reclassified to income statement | $ 11,400 | ||||
Cross-currency swap unrealized gains expected to be reclassified within next twelve months | 2,100 | ||||
Interest rate swaps | Interest expense | |||||
Derivative [Line Items] | |||||
Unrealized gains (losses) reclassified to income statement | (1,600) | $ (678) | |||
Interest rate swaps and treasury locks | Interest expense | |||||
Derivative [Line Items] | |||||
Interest rate swap unrealized loss expected to be reclassified within next twelve months | $ 12,000 |
Operating Leases - Narrative (D
Operating Leases - Narrative (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2020USD ($)stateproperty | Mar. 31, 2019USD ($) | |
Operating Leases | ||
Number of properties owned | 6,525 | |
Number of U.S. states where properties are owned (states) | state | 49 | |
Percentage rent received | $ | $ 1.2 | $ 3.6 |
Single-tenant properties | ||
Operating Leases | ||
Number of properties owned | 6,490 | |
Single-tenant properties as percentage of total properties | 99.50% | |
Properties available for lease or sale | ||
Operating Leases | ||
Number of properties owned | 97 |
Gain on Sales of Real Estate (D
Gain on Sales of Real Estate (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020USD ($)property | Mar. 31, 2019USD ($)property | |
Gain (Loss) on Sale of Investments [Abstract] | ||
Number of properties | property | 17 | 19 |
Net sales proceeds | $ 126,233 | $ 22,456 |
Gain on sales of real estate | $ 38,506 | $ 7,263 |
Impairments - (Details)
Impairments - (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020USD ($)property | Mar. 31, 2019USD ($)property | |
Provisions for impairment | ||
Provisions for impairment | $ | $ 4,478 | $ 4,672 |
Number of impaired properties held for sale | 8 | 0 |
Number of impaired properties held for investment | 1 | 0 |
Number of impaired properties sold | 7 | 11 |
Distributions Paid and Payabl_2
Distributions Paid and Payable - Distributions to Common Stockholders (Details) - $ / shares | 1 Months Ended | 3 Months Ended | |||||||
Apr. 30, 2020 | Mar. 31, 2020 | Feb. 29, 2020 | Jan. 31, 2020 | Mar. 31, 2019 | Feb. 28, 2019 | Jan. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Distributions Paid and Payable | |||||||||
Distributions paid per common share (in dollars per share) | $ 0.2325 | $ 0.2325 | $ 0.2275 | $ 0.2255 | $ 0.2255 | $ 0.2210 | $ 0.6925 | $ 0.6720 | |
Distributions payable (in dollars per share) | $ 0.233 | $ 0.233 | |||||||
Subsequent event | |||||||||
Distributions Paid and Payable | |||||||||
Distributions paid per common share (in dollars per share) | $ 0.233 |
Net Income per Common Share - R
Net Income per Common Share - Reconciliation of net income per share computation (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Weighted average shares used for the basic net income per share computation (in shares) | 336,624,567 | 303,528,336 |
Incremental shares from share-based compensation (in shares) | 351,948 | 291,542 |
Weighted average shares used for diluted net income per share computation (in shares) | 336,976,515 | 303,819,878 |
Unvested shares from share-based compensation | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation (in shares) | 31,001 | 30,060 |
Convertible common partnership units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation (in shares) | 463,119 | 377,767 |
Supplemental Disclosures of C_3
Supplemental Disclosures of Cash Flow Information - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Mar. 28, 2019 | Jan. 01, 2019 | Apr. 30, 2018 | Mar. 30, 2018 | |
Supplemental Disclosures of Cash Flow Information | |||||||
Cash paid for interest | $ 84,100 | $ 82,200 | |||||
Cash paid for income taxes | 2,500 | $ 1,700 | |||||
Non-cash activities | |||||||
Lease liabilities | 121,790 | $ 122,285 | $ 132,000 | ||||
Right-of-use assets | $ 132,000 | ||||||
Non-refundable deposits from 2019 applied to acquisitions | 14,800 | ||||||
Realty Income, L.P. | |||||||
Non-cash activities | |||||||
Number of partnership units issued (in units) | 89,322 | 89,322 | 131,790 | 242,007 | |||
Shares issued in conjunction with acquisitions | $ 6,300 | ||||||
Derivative [Member] | |||||||
Non-cash activities | |||||||
Decrease in fair value of net derivative liabilities | $ 16,400 |
Supplemental Disclosures of C_4
Supplemental Disclosures of Cash Flow Information - Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Reconciliation of cash,cash equivalents, and restricted cash | ||||
Cash and cash equivalents shown in the consolidated balance sheets | $ 41,804 | $ 54,011 | $ 2,997 | |
Restricted escrow deposits | 82,391 | 4,529 | 9,081 | |
Impounds related to mortgages payable | 12,962 | 12,465 | 10,256 | |
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | $ 137,157 | $ 71,005 | $ 22,334 | $ 21,071 |
Segment Information - Assets (D
Segment Information - Assets (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020USD ($)segment | Dec. 31, 2019USD ($) | |
Segment Reporting [Abstract] | ||
Number of activity segments | segment | 51 | |
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | $ 16,591,937 | $ 16,496,772 |
Intangible assets | 1,516,819 | 1,493,383 |
Other corporate assets | 687,686 | 564,641 |
Total assets | 18,796,442 | 18,554,796 |
Automotive service | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 286,380 | 288,453 |
Intangible assets | 57,833 | 58,854 |
Automotive tire services | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 232,093 | 232,709 |
Intangible assets | 6,940 | 7,322 |
Beverages | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 278,318 | 279,373 |
Intangible assets | 1,444 | 1,509 |
Child care | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 217,120 | 208,326 |
Intangible assets | 22,805 | 21,997 |
Convenience stores | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 2,040,499 | 2,057,157 |
Intangible assets | 129,145 | 131,808 |
Dollar stores | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 1,430,852 | 1,427,950 |
Intangible assets | 81,755 | 82,701 |
Drug stores | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 1,603,799 | 1,618,854 |
Intangible assets | 179,585 | 183,319 |
Financial services | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 386,310 | 389,634 |
Intangible assets | 16,468 | 17,130 |
General merchandise | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 515,199 | 475,418 |
Intangible assets | 74,187 | 66,135 |
Grocery stores - U.S. | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 911,070 | 922,349 |
Intangible assets | 176,030 | 180,197 |
Grocery stores - U.K. | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 664,056 | 663,210 |
Intangible assets | 177,001 | 153,407 |
Health and fitness | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 1,092,881 | 1,019,796 |
Intangible assets | 74,257 | 74,428 |
Home improvement | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 503,092 | 495,305 |
Intangible assets | 73,939 | 72,979 |
Restaurants-casual dining | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 568,547 | 576,526 |
Intangible assets | 22,629 | 23,289 |
Restaurants-quick service | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 1,067,239 | 1,059,155 |
Intangible assets | 51,372 | 52,353 |
Theaters - U.S. | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 869,621 | 878,103 |
Intangible assets | 35,029 | 36,089 |
Transportation services | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 720,929 | 769,614 |
Intangible assets | 58,957 | 66,055 |
Wholesale club | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 393,501 | 396,690 |
Intangible assets | 22,594 | 23,372 |
Other non-reportable segments | ||
Reconciliation of assets from segment to consolidated | ||
Real Estate Investment Property, Net, Including Disposal Group Assets | 2,810,431 | 2,738,150 |
Intangible assets | $ 254,849 | $ 240,439 |
Segment Information - Revenue (
Segment Information - Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Segment revenue information | ||
Rental (including reimbursable) | $ 412,157 | $ 354,037 |
Other | 2,184 | 328 |
Total revenue | 414,341 | 354,365 |
Automotive service | ||
Segment revenue information | ||
Rental (including reimbursable) | 8,670 | 7,213 |
Automotive tire services | ||
Segment revenue information | ||
Rental (including reimbursable) | 7,833 | 7,777 |
Beverages | ||
Segment revenue information | ||
Rental (including reimbursable) | 7,996 | 7,915 |
Child care | ||
Segment revenue information | ||
Rental (including reimbursable) | 9,481 | 7,827 |
Convenience stores | ||
Segment revenue information | ||
Rental (including reimbursable) | 46,733 | 41,214 |
Dollar stores | ||
Segment revenue information | ||
Rental (including reimbursable) | 31,391 | 24,986 |
Drug stores | ||
Segment revenue information | ||
Rental (including reimbursable) | 35,299 | 33,170 |
Financial services | ||
Segment revenue information | ||
Rental (including reimbursable) | 7,543 | 7,718 |
General merchandise | ||
Segment revenue information | ||
Rental (including reimbursable) | 11,316 | 6,911 |
Grocery stores - U.S. | ||
Segment revenue information | ||
Rental (including reimbursable) | 19,509 | 16,124 |
Grocery stores - U.K. | ||
Segment revenue information | ||
Rental (including reimbursable) | 10,405 | 0 |
Health and fitness | ||
Segment revenue information | ||
Rental (including reimbursable) | 28,278 | 26,225 |
Home improvement | ||
Segment revenue information | ||
Rental (including reimbursable) | 11,309 | 9,815 |
Restaurants-casual dining | ||
Segment revenue information | ||
Rental (including reimbursable) | 12,538 | 11,290 |
Restaurants-quick service | ||
Segment revenue information | ||
Rental (including reimbursable) | 23,308 | 21,730 |
Theaters - U.S. | ||
Segment revenue information | ||
Rental (including reimbursable) | 24,567 | 17,656 |
Transportation services | ||
Segment revenue information | ||
Rental (including reimbursable) | 16,187 | 16,026 |
Wholesale club | ||
Segment revenue information | ||
Rental (including reimbursable) | 9,588 | 9,593 |
Other non-reportable segments and tenant reimbursements | ||
Segment revenue information | ||
Rental (including reimbursable) | $ 90,206 | $ 80,847 |
Common Stock Incentive Plan - S
Common Stock Incentive Plan - Summary (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Common Stock Incentive Plan | ||
Severance charge | $ 3,500,000 | |
2012 Plan | ||
Common Stock Incentive Plan | ||
Plan term from the date of adoption | 10 years | |
General and administrative expense | ||
Common Stock Incentive Plan | ||
Share-based compensation costs recognized | $ 5,500,000 | $ 2,800,000 |
Accelerated share-based compensation costs | $ 1,800,000 | |
Maximum | 2012 Plan | ||
Common Stock Incentive Plan | ||
Authorized shares | 3,985,734 | |
Cash | ||
Common Stock Incentive Plan | ||
Severance charge | $ 1,600,000 | |
Share-based compensation | ||
Common Stock Incentive Plan | ||
Severance charge | 1,800,000 | |
Professional fees | ||
Common Stock Incentive Plan | ||
Severance charge | $ 58,000 |
Common Stock Incentive Plan - R
Common Stock Incentive Plan - Restricted Stock (Details) - Restricted Stock - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended |
May 31, 2019 | Mar. 31, 2020 | |
Common Stock Incentive Plan | ||
Shares granted in period (in shares) | 62,873 | |
Vesting period (in years) | 4 years | |
Unamortized share-based compensation expense | $ 12.4 | |
Former CEO | Vest immediately | ||
Common Stock Incentive Plan | ||
Shares granted in period (in shares) | 4,541 |
Common Stock Incentive Plan - P
Common Stock Incentive Plan - Performance Shares and Restricted Stock Units (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($)shares | |
Performance Shares and Restricted Stock Units | |
Common Stock Incentive Plan | |
Unamortized share-based compensation expense | $ | $ 15.6 |
Performance Shares | |
Common Stock Incentive Plan | |
Shares granted in period (in shares) | 98,844 |
Vesting rights percentage | 50.00% |
Vesting period (in years) | 3 years |
Restricted Stock Units | |
Common Stock Incentive Plan | |
Shares granted in period (in shares) | 9,966 |
Vesting period (in years) | 4 years |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | Mar. 31, 2020USD ($) |
Re-leasing costs, recurring capital expenditures, and non-recurring building improvements | |
Commitments and Contingencies [Line Items] | |
Other commitments | $ 6.1 |
Construction contracts | |
Commitments and Contingencies [Line Items] | |
Other commitments | $ 13.2 |
Subsequent Events - Narrative (
Subsequent Events - Narrative (Details) $ / shares in Units, $ in Thousands, £ in Millions | Apr. 09, 2020USD ($) | Apr. 30, 2020$ / shares | Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | May 01, 2020GBP (£) | May 01, 2020USD ($) | Dec. 31, 2019GBP (£) | Dec. 31, 2019USD ($) |
Subsequent Event [Line Items] | ||||||||
Borrowings on line of credit | $ 846,532 | $ 732,000 | ||||||
Cash and cash equivalents | 41,804 | $ 2,997 | $ 54,011 | |||||
Outstanding balance | 615,176 | 704,335 | ||||||
Unsecured debt | Revolving Credit Facility | ||||||||
Subsequent Event [Line Items] | ||||||||
Outstanding balance | 615,200 | £ 169.2 | $ 704,300 | |||||
Current borrowing capacity | 2,400,000 | |||||||
Credit facility expansion option | $ 1,000,000 | |||||||
Subsequent event | ||||||||
Subsequent Event [Line Items] | ||||||||
Common stock dividend declared (in dollars per share) | $ / shares | $ 0.233 | |||||||
Cash and cash equivalents | $ 1,250,000 | |||||||
Subsequent event | Unsecured debt | Revolving Credit Facility | ||||||||
Subsequent Event [Line Items] | ||||||||
Borrowings on line of credit | $ 1,200,000 | |||||||
Outstanding balance | £ 325.5 | $ 1,900,000 | ||||||
Current borrowing capacity | 1,100,000 | |||||||
Credit facility expansion option | $ 1,000,000 | |||||||
Subsequent event | Total portfolio | ||||||||
Subsequent Event [Line Items] | ||||||||
Collection Of Contractual Rent Due In Prior Month, Percentage | 82.90% | 82.90% | ||||||
Subsequent event | Top 20 tenants | ||||||||
Subsequent Event [Line Items] | ||||||||
Collection Of Contractual Rent Due In Prior Month, Percentage | 82.90% | 82.90% | ||||||
Subsequent event | Investment grade tenants | ||||||||
Subsequent Event [Line Items] | ||||||||
Collection Of Contractual Rent Due In Prior Month, Percentage | 99.90% | 99.90% |