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AFFO per Share: $1.06, representing a year-over-year growth of 2.9%.
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Total Operational Returns: 8.9% for the quarter.
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Investment Volume: $1.4 billion at a 7.5% weighted average initial cash yield.
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US Investments: $479 million at an 8.3% weighted average initial cash yield.
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European Investments: $893 million at a 7% average initial cash yield.
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Portfolio Occupancy: 98.5%, approximately 20 basis points below the prior quarter.
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Rent Recapture Rate: 103.9% across 194 leases.
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Properties Sold: 55 properties for total net proceeds of $93 million.
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Net Debt to Annualized Pro Forma Adjusted EBITDA: 5.4x.
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Fixed Charge Coverage Ratio: 4.7x.
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Variable Rate Debt Exposure: Just over 6% of outstanding debt principal.
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2025 AFFO per Share Outlook: $4.22 to $4.28.
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2025 Investment Deployment Target: Approximately $4 billion.
Release Date: May 05, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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Realty Income Corp (NYSE:O) reported a year-over-year growth of 2.9% in AFFO per share, reaching $1.06.
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The company achieved a total operational return of 8.9% for the quarter, supported by a 6% dividend yield.
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Realty Income Corp (NYSE:O) invested $1.4 billion at a 7.5% weighted average initial cash yield, with significant investments in Europe.
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The company maintained a high portfolio occupancy rate of 98.5%, slightly above the historical median.
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Realty Income Corp (NYSE:O) successfully closed a $600 million 10-year unsecured bond offering and expanded its multicurrency unsecured credit facility to $5.38 billion.
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Portfolio occupancy decreased by approximately 20 basis points from the prior quarter.
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The company anticipates a potential rent loss of 75 basis points for 2025, primarily from properties acquired through prior M&A transactions.
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Realty Income Corp (NYSE:O) faces challenges in finding suitable risk-adjusted investment opportunities in the US compared to Europe.
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The company is cautious about increasing its investment guidance due to ongoing market uncertainties.
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Realty Income Corp (NYSE:O) experienced a slight decrease in rent recapture rate due to specific asset types, such as theaters.
Q: Can you discuss the investment activity in Europe during the first quarter and how it compares to opportunities in the US? A: Sumit Roy, President and CEO, explained that 65% of the total investment volume came from Europe, focusing on retail parks in the UK and Ireland. These investments were compelling due to below-market rents and acquisition costs well below replacement costs. In contrast, while there were opportunities in the US, the credit risks associated with higher-yielding investments were not as favorable.
