National Retail Properties, Inc. (NYSE:NNN) Q3 2023 Earnings Call Transcript

Stephen Horn: At the beginning of the year, we are definitely up higher. But as far as starting midyear, we are landing what I’m expecting and I’m expecting it to increase in the near term as well.

Linda Tsai: And then on the 20 bps quarter-over-quarter increase over the past two quarters, is that like the same run rate for next quarter?

Stephen Horn: It is probably pretty close. As far as new money going out the door, absolutely. It is above that trend. But we have the – what we call the split-funded deals that we are funding construction that are building the asset. So you have a little bit of a headwind because that money – we committed 3 months ago, 2 months ago. So it is kind of a little older money.

Operator: Thank you. [Operator Instructions] Our next question is coming from Josh Dennerlein with Bank of America.

Unknown Analyst: This is [Daryl Granite] (Ph) on behalf of Josh. Actually, just touching on the split fund developments just mentioning. I was curious if you could give some color on the sort of retailers that fall into that bucket? And any delivery timing and yields that you can touch on?

Stephen Horn: Primarily are split funded because we only do split funded deals with relationship tenants. So it pretty much compromises our quarterly acquisition pictures – so kind of automotive services, a little bit of the family entertainment primarily. Now as far as timing, we deal with small box retailers. So by the time we buy the ground, it could be 120-days before it is delivered and they start paying rent.

Kevin Habicht: Yes. So maybe one way to think about pricing on that is whatever our cap rates were last quarter, maybe that is where the switch fund was priced will play out over the next three to six-months as the project gets completed and so is just a guide.

Operator: We currently have no further questions in queue at this time. So I will hand it back to Mr. Horn for any closing remarks.

Stephen Horn: Thank you for joining us on the call this morning, and we will see many of you, I guess, in a couple of weeks at NAREIT. Have a good day. Thanks.

Operator: Thank you. This concludes today’s conference, and you may disconnect your lines at this time, and we thank you for your participation.