PR Newswire | Nov 2, 2021 08:31AM EDT

Retail Properties, Inc.

11/02 07:30 CDT

Third Quarter 2021 Operating Results And 2022 Guidance Announced By National Retail Properties, Inc. ORLANDO, Fla., Nov. 2, 2021

ORLANDO, Fla., Nov. 2, 2021 /PRNewswire/ -- National Retail Properties, Inc. (NYSE: NNN), a real estate investment trust, today announced its operating results for the quarter and nine months ended September 30, 2021. Highlights include:

Operating Results:

* Revenues and net earnings, FFO, Core FFO and AFFO available to common stockholders and diluted per share amounts:

Quarter Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

(in thousands, except per share data)

Revenues $ 180,357 $ 158,633 $ 539,146 $ 497,397

Net earnings available to common stockholders $ 78,448 $ 51,584 ^(1) $ 199,088 $ 154,057 ^(1)

Net earnings per common share $ 0.45 $ 0.30 ^(1) $ 1.14 $ 0.89 ^(1)

FFO available to common stockholders $ 124,621 $ 106,423 $ 347,304 $ 320,670

FFO per common share $ 0.71 $ 0.62 $ 1.99 $ 1.87

Core FFO available to common stockholders $ 124,621 $ 106,423 $ 368,632 $ 337,349

Core FFO per common share $ 0.71 $ 0.62 $ 2.11 $ 1.96

AFFO available to common stockholders $ 131,753 ^(2) $ 106,690 ^(3) $ 399,660 ^(2) $ 311,680 ^(3)

AFFO per common share $ 0.75 ^(2) $ 0.62 ^(3) $ 2.29 ^(2) $ 1.81 ^(3)

^ Includes a write-off of $14,758 (or $0.09 per share) of receivables due to(1) reclassifying certain tenants as cash basis for accounting purposes during the quarter and nine months ended September 30, 2020.

Amounts include $4,294 and $21,996 of net straight-line accrued rent from^ rent deferral repayments from the COVID-19 rent deferral lease amendments(2) for the quarter and nine months ended September 30, 2021, respectively. Excluding such, AFFO per common share would have been $0.73 and $2.16 for the quarter and nine months ended September 30, 2021, respectively.

Amounts exclude $8,499 and $38,938 of net straight-line accrued rent from^ rent deferral repayments from the COVID-19 rent deferral lease amendments(3) for the quarter and nine months ended September 30, 2020, respectively. Including such, AFFO per common share would have been $0.67 and $2.04 for the quarter and nine months ended September 30, 2020, respectively.

Third Quarter 2021 Highlights:

* As of October 27, 2021, NNN had collected approximately 99% of rent originally due for the quarter ended September 30, 2021, and approximately 99% of rent originally due in October 2021 * Maintained high occupancy levels at 98.6%, with a weighted average remaining lease term of 10.6 years, at September 30, 2021 as compared to 98.3% at June 30, 2021 and 98.5% at December 31, 2020 * Invested $246.8 million in property investments, including the acquisition of 49 properties with an aggregate 561,000 square feet of gross leasable area at an initial cash yield of 6.4% * Sold 27 properties for $30.5 million producing $9.5 million of gains on sales * Issued $450 million principal amount of 3.000% senior unsecured notes due 2052 * Ended the quarter with $543.5 million of cash and no amounts drawn on the $1.1 billion bank credit facility

Highlights for the nine months ended September 30, 2021:

* Invested $455.4 million in property investments, including the acquisition of 107 properties with an aggregate 1,090,000 square feet of gross leasable area at an initial cash yield of 6.5% * Sold 53 properties for $71.0 million producing $17.9 million of gains on sales * Raised $3.1 million net proceeds from the issuance of 76,666 common shares * Issued $450 million principal amount of 3.500% senior unsecured notes due 2051 * Issued $450 million principal amount of 3.000% senior unsecured notes due 2052 * Redeemed $350 million principal amount of 3.300% senior unsecured notes due 2023 * Expanded line of credit borrowing capacity from $900 million to $1.1 billion, reduced pricing from LIBOR plus 87.5 basis points to LIBOR plus 77.5 basis points, and extended maturity to June 2025. * Weighted average debt maturity increased to 14.9 years

NNN has entered into rent deferral lease amendments with certain tenants, for an aggregate $4,758,000 and $52,019,000 of rent originally due for the years ending December 31, 2021 and 2020, respectively. The rent deferral lease amendments require the deferred rents to be repaid at a later time during the lease term. Approximately $3,259,000 of deferred rent was repaid in 2020 and $27,087,000 of deferred rent was repaid during the nine months ended September 30, 2021.

Core FFO guidance for 2021 was increased from a range of $2.75 to $2.80 per share to a range of $2.80 to $2.84 per share. The 2021 AFFO is estimated to be $3.00 to $3.04 per share. The Core FFO guidance equates to net earnings of $1.64 to $1.68 per share, plus $1.16 per share of expected real estate depreciation and amortization and excludes any gains from the sale of real estate, any charges for impairments, preferred stock redemption charges and loss on early extinguishment of debt. The guidance is based on current plans and assumptions and subject to risks and uncertainties more fully described in this press release and the company's reports filed with the Securities and Exchange Commission.

The company also announced 2022 Core FFO guidance of $2.90 to $2.97 per share and estimated 2022 AFFO to be $2.99 to $3.06 per share. The Core FFO guidance equates to net earnings of $1.73 to $1.80 per share, plus $1.17 per share of expected real estate depreciation and amortization and excludes any gains from the sale of real estate, and any charges for impairments. The guidance is based on current plans and assumptions and subject to risks and uncertainties more fully described in this press release and the company's reports filed with the Securities and Exchange Commission.

Jay Whitehurst, Chief Executive Officer, commented: "We are pleased to report another solid quarter for National Retail Properties, with increasing acquisition volume, continued high occupancy and rent collections, and a rock solid balance sheet. Our impressive performance positions us to once again raise guidance for 2021 and to announce 2022 guidance that reflects our long-term strategy to consistently produce mid-single digits growth per share on a multi-year basis."

National Retail Properties invests primarily in high-quality retail properties subject generally to long-term, net leases. As of September 30, 2021, the company owned 3,195 properties in 48 states with a gross leasable area of approximately 33.0 million square feet and with a weighted average remaining lease term of 10.6 years. For more information on the company, visit www.nnnreit.com.

Management will hold a conference call on November 2, 2021, at 10:30 a.m. ET to review these results. The call can be accessed on the National Retail Properties web site live at http://www.nnnreit.com. For those unable to listen to the live broadcast, a replay will be available on the company's web site. In addition, a summary of any earnings guidance given on the call will be posted to the company's web site.

Statements in this press release that are not strictly historical are "forward-looking" statements. These statements generally are characterized by the use of terms such as "believe," "expect," "intend," "may," "estimated," or other similar words or expressions. Forward-looking statements involve known and unknown risks, which may cause the company's actual future results to differ materially from expected results. These risks include, among others, the potential impacts of the COVID-19 pandemic on the company's business operations, financial results and financial position and on the world economy, general economic conditions, local real estate conditions, changes in interest rates, increases in operating costs, the preferences and financial condition of the company's tenants, the availability of capital, and, risks related to the company's status as a REIT. Additional information concerning these and other factors that could cause actual results to differ materially from these forward-looking statements is contained from time to time in the company's Securities and Exchange Commission (the "Commission") filings, including, but not limited to, the company's (i) Annual Report on Form 10-K for the year ended December 31, 2020 and (ii) Quarterly Report on Form 10-Q for the quarter and nine months ended September 30, 2021. Copies of each filing may be obtained from the company or the Commission. Such forward-looking statements should be regarded solely as reflections of the company's current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. National Retail Properties, Inc. undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.

Funds From Operations, commonly referred to as FFO, is a relative non-GAAP financial measure of operating performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO is defined by the National Association of Real Estate Investment Trusts ("NAREIT") and is used by the company as follows: net earnings (computed in accordance with GAAP) plus depreciation and amortization of assets unique to the real estate industry, excluding gains (or including losses), any applicable taxes and noncontrolling interests on the disposition of certain assets, the company's share of these items from the company's unconsolidated partnerships and any impairment charges on a depreciable real estate asset.

FFO is generally considered by industry analysts to be the most appropriate measure of performance of real estate companies. FFO does not necessarily represent cash provided by operating activities in accordance with GAAP and should not be considered an alternative to net earnings as an indication of the company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers FFO an appropriate measure of performance of an equity REIT because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure. The company's computation of FFO may differ from the methodology for calculating FFO used by other equity REITs, and therefore, may not be comparable to such other REITs. A reconciliation of net earnings (computed in accordance with GAAP) to FFO, as defined by NAREIT, is included in the financial information accompanying this release.

Core Funds From Operations ("Core FFO") is a non-GAAP measure of operating performance that adjusts FFO to eliminate the impact of certain GAAP income and expense amounts that the company believes are infrequent and unusual in nature and/or not related to its core real estate operations. Exclusion of these items from similar FFO-type metrics is common within the REIT industry, and management believes that presentation of Core FFO provides investors with a potential metric to assist in their evaluation of the company's operating performance across multiple periods and in comparison to the operating performance of its peers because it removes the effect of unusual items that are not expected to impact the company's operating performance on an ongoing basis. Core FFO is used by management in evaluating the performance of the company's core business operations and is a factor in determining management compensation. Items included in calculating FFO that may be excluded in calculating Core FFO may include items like transaction related gains, income or expense, impairments on land or commercial mortgage residual interests, preferred stock redemption costs, loss or early extinguishment of debt or other non-core amounts as they occur. The company's computation of Core FFO may differ from the methodology for calculating Core FFO used by other equity REITs, and therefore, may not be comparable to such other REITs. A reconciliation of net earnings (computed in accordance with GAAP) to Core FFO is included in the financial information accompanying this release.

Adjusted Funds From Operations ("AFFO") is a non-GAAP financial measure of operating performance used by many companies in the REIT industry. AFFO adjusts FFO for certain non-cash items that reduce or increase net income in accordance with GAAP. AFFO should not be considered an alternative to net earnings, as an indication of the company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers AFFO a useful supplemental measure of the company's performance. The company's computation of AFFO may differ from the methodology for calculating AFFO used by other equity REITs, and therefore, may not be comparable to such other REITs. A reconciliation of net earnings (computed in accordance with GAAP) to AFFO is included in the financial information accompanying this release.

National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)

Quarter Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Income Statement Summary

Revenues:

Rental income $ 180,024 $ 157,865 $ 537,226 $ 495,891

Interest and other income from real estate 333 768 1,920 1,506 transactions

180,357 158,633 539,146 497,397

Operating expenses:

General and administrative 11,077 9,419 34,693 28,914

Real estate 6,521 6,345 20,865 20,304

Depreciation and amortization 50,976 49,404 151,831 147,528

Leasing transaction costs 86 - 146 36

Impairment losses - real estate, net of 4,781 5,695 14,647 33,062 recoveries

73,441 70,863 222,182 229,844

Gain on disposition of real estate 9,473 148 17,935 13,637

Earnings from operations 116,389 87,918 334,899 281,190

Other expenses (revenues):

Interest and other income (61) (74) (159) (345)

Interest expense 33,518 31,924 101,190 ^(1) 97,347 ^(2)

Loss on early extinguishment of debt - - 21,328 16,679

33,457 31,850 122,359 113,681

Net earnings 82,932 56,068 212,540 167,509

Loss attributable to noncontrolling interests 1 1 3 3

Net earnings attributable to NNN 82,933 56,069 212,543 167,512

Series F preferred stock dividends (4,485) (4,485) (13,455) (13,455)

Net earnings available to common stockholders $ 78,448 $ 51,584 $ 199,088 $ 154,057

Weighted average common shares outstanding:

Basic 174,629 172,681 174,610 171,707

Diluted 174,739 172,782 174,716 171,815

Net earnings per share available to common stockholders:

Basic $ 0.45 $ 0.30 $ 1.14 $ 0.89

Diluted $ 0.45 $ 0.30 $ 1.14 $ 0.89

^ Includes $2,078 in connection with the redemption of 3.30% senior unsecured(1) notes due 2023 for the nine months ended September 30, 2021.

^ Includes $2,291 in connection with the redemption of 3.80% senior unsecured(2) notes due 2022 for the nine months ended September 30, 2020.

National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)

Quarter Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Funds From Operations (FFO) Reconciliation:

Net earnings available to common stockholders $ 78,448 $ 51,584 ^(1) $ 199,088 $ 154,057 ^(1)

Real estate depreciation and amortization 50,865 49,292 151,504 147,188

Gain on disposition of real estate (9,473) (148) (17,935) (13,637)

Impairment losses - depreciable real estate, net of 4,781 5,695 14,647 33,062 recoveries

Total FFO adjustments 46,173 54,839 148,216 166,613

FFO available to common stockholders $ 124,621 $ 106,423 $ 347,304 $ 320,670

FFO per common share:

Basic $ 0.71 $ 0.62 $ 1.99 $ 1.87

Diluted $ 0.71 $ 0.62 $ 1.99 $ 1.87

Core Funds From Operations (Core FFO) Reconciliation:

Net earnings available to common stockholders $ 78,448 $ 51,584 ^(1) $ 199,088 $ 154,057 ^(1)

Total FFO adjustments 46,173 54,839 148,216 166,613

FFO available to common stockholders 124,621 106,423 347,304 320,670

Loss on early extinguishment of debt - - 21,328 16,679

Total Core FFO adjustments - - 21,328 16,679

Core FFO available to common stockholders $ 124,621 $ 106,423 $ 368,632 $ 337,349

Core FFO per common share:

Basic $ 0.71 $ 0.62 $ 2.11 $ 1.96

Diluted $ 0.71 $ 0.62 $ 2.11 $ 1.96

^ Includes a write-off of $14,758 (or $0.09 per share) of receivables due to(1) reclassifying certain tenants as cash basis for accounting purposes during the quarter and nine months ended September 30, 2020.

National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)

Quarter Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Adjusted Funds From Operations (AFFO)Reconciliation:

Net earnings available to common stockholders $ 78,448 $ 51,584 ^(1) $ 199,088 $ 154,057 ^(1)

Total FFO adjustments 46,173 54,839 148,216 166,613

Total Core FFO adjustments - - 21,328 16,679

Core FFO available to common stockholders 124,621 106,423 368,632 337,349

Straight-line accrued rent, net of reserves 3,400 (2,419) 19,091 (33,464)

Net capital lease rent adjustment 77 61 262 144

Below-market rent amortization (156) (301) (430) (711)

Stock based compensation expense 3,898 3,258 12,320 9,580

Capitalized interest expense (87) (332) (215) (1,218)

Total AFFO adjustments 7,132 267 31,028 (25,669)

AFFO available to common stockholders $ 131,753 ^(2) $ 106,690 ^(3) $ 399,660 ^(2) $ 311,680 ^(3)

AFFO per common share:

Basic $ 0.75 ^(2) $ 0.62 ^(3) $ 2.29 ^(2) $ 1.82 ^(3)

Diluted $ 0.75 ^(2) $ 0.62 ^(3) $ 2.29 ^(2) $ 1.81 ^(3)

Other Information:

Rental income from operating leases^(4) $ 175,833 $ 153,825 $ 522,787 $ 481,858

Earned income from direct financing leases^(4) $ 154 $ 161 $ 469 $ 487

Percentage rent^(4) $ 195 $ 160 $ 530 $ 728

Real estate expense reimbursement from tenants^(4) $ 3,842 $ 3,719 $ 13,440 $ 12,818

Real estate expenses (6,521) (6,345) (20,865) (20,304)

Real estate expenses, net of tenant reimbursements $ (2,679) $ (2,626) $ (7,425) $ (7,486)

Amortization of debt costs $ 1,139 $ 1,082 $ 4,022 ^(5) $ 3,924 ^(6)

Scheduled debt principal amortization (excluding $ 157 $ 149 $ 469 $ 443 maturities)

Non-real estate depreciation expense $ 114 $ 114 $ 336 $ 347

^ Includes a write-off of $14,758 (or $0.09 per share) of receivables due to(1) reclassifying certain tenants as cash basis for accounting purposes during the quarter and nine months ended September 30, 2020.

Amounts include the net straight-line accrued rent impact of the rent deferral repayments from the COVID-19 rent deferral lease amendments of^ $4,294 and $21,996 for the quarter and nine months ended September 30,(2) 2021, respectively. Excluding such, AFFO per common share would have been $0.73 and $2.16 for the quarter and nine months ended September 30, 2021, respectively.

Amounts exclude $8,499 and $38,938 of straight-line accrued rent from rent^ deferral repayments from the COVID-19 rent deferral lease amendments(3) quarter and nine months ended September 30, 2020, respectively. Including such, AFFO per common share would have been $0.67 and $2.04 for the quarter and nine months ended September 30, 2020, respectively.

For the quarter and nine months ended September 30, 2021, the aggregate of^ such amounts is $180,024 and $537,226, respectively, and is classified as(4) rental income on the income statement summary. For the quarter and nine months ended September 30, 2020, the aggregate of such amounts is $157,865 and $495,891, respectively.

^ Includes $745 in connection with the redemption of the 3.30% senior(5) unsecured notes due 2023 for the nine months ended September 30, 2021.

^ Includes $851 in connection with the redemption of the 3.80% senior(6) unsecured notes due 2022 for the nine months ended September 30, 2020.

Earnings Guidance:Guidance is based on current plans and assumptions and subject to risks and uncertainties more fully described in this press release and the company's reports filed with the Commission.

2021 Guidance 2022 Guidance

Net earnings per common share excluding any gains on disposition of real estate, impairment charges, preferred stock redemption $1.64 - $1.68 per share $1.73 - $1.80 per share charges and loss on early extinguishment of debt

Real estate depreciation and amortization per share $1.16 per share $1.17 per share

Core FFO per share $2.80 - $2.84 per share $2.90 - $2.97 per share

AFFO per share^(1) $3.00 - $3.04 per share $2.99 - $3.06 per share

General and administrative expenses $46 - $48 Million $45 - $47 Million

Real estate expenses, net of tenant reimbursements $10 - $11 Million $10 - $12 Million

Acquisition volume $550 - $600 Million $550 - $650 Million

Disposition volume $80 - $100 Million $80 - $100 Million

Estimates include the net straight-line accrued rent impact of the rent^ repayment from the COVID-19 rent deferral lease amendments of $24.9(1) million for 2021 and $5.4 million for 2022. Absent such, AFFO per common share guidance would have been $2.86 - $2.90 per share for 2021 and $2.96 - $3.03 for 2022.

National Retail Properties, Inc.

(in thousands)

(unaudited)

September 30, December 31, 2021 2020

Balance Sheet Summary

Assets:

Real estate portfolio $ 7,442,473 $ 7,212,655

Real estate held for sale 9,709 5,671

Cash and cash equivalents 543,526 267,236

Receivables, net of allowance of $693 and $835, respectively 2,128 4,338

Accrued rental income, net of allowance of $4,922 and $6,947, respectively 34,341 53,958

Debt costs, net of accumulated amortization of $18,810 and $17,294, 7,960 1,917respectively

Other assets 92,808 92,069

Total assets $ 8,132,945 $ 7,637,844

Liabilities:

Line of credit payable $ - $ -

Mortgages payable, including unamortized premium and net of unamortized debt 10,875 11,395cost

Notes payable, net of unamortized discount and unamortized debt costs 3,734,764 3,209,527

Accrued interest payable 52,803 19,401

Other liabilities 74,360 78,217

Total liabilities 3,872,802 3,318,540

Stockholders' equity of NNN 4,260,142 4,319,300

Noncontrolling interests 1 4

Total equity 4,260,143 4,319,304

Total liabilities and equity $ 8,132,945 $ 7,637,844

Common shares outstanding 175,616 175,233

Gross leasable area, Property Portfolio (square feet) 33,005 32,461

National Retail Properties, Inc.

Debt Summary

As of September 30, 2021

(in thousands)

(unaudited)

Principal,Unsecured Debt Principal Net of Stated Effective Maturity Date Unamortized Rate Rate Discount

Line of credit payable $ - $ - L + 77.5 bps - % June 2025

Unsecured notes payable:

2024 350,000 349,782 3.900 % 3.924 % June 2024

2025 400,000 399,558 4.000 % 4.029 % November 2025

2026 350,000 347,814 3.600 % 3.733 % December 2026

2027 400,000 398,956 3.500 % 3.548 % October 2027

2028 400,000 397,878 4.300 % 4.388 % October 2028

2030 400,000 398,892 2.500 % 2.536 % April 2030

2048 300,000 295,964 4.800 % 4.890 % October 2048

2050 300,000 294,128 3.100 % 3.205 % April 2050

2051 450,000 441,681 3.500 % 3.602 % April 2051

2052 450,000 439,586 3.000 % 3.118 % April 2052

Total 3,800,000 3,764,239

Total unsecured debt^(1) $ 3,800,000 $ 3,764,239

Debt costs (38,145)

Accumulated amortization 8,670

Debt costs, net of accumulated amortization (29,475)

Notes payable, net of unamortized discount and $ 3,734,764 unamortized debt costs

^ Unsecured notes payable have a weighted average interest rate of 3.7% and a(1) weighted average maturity of 14.9 years.

Mortgages Payable Principal Interest Maturity Date Balance Rate

Mortgage^(1) $ 10,901 5.230 % July 2023

Debt costs (147)

Accumulated amortization 121

Debt costs, net of accumulated amortization (26)

Mortgages payable, including unamortized $ 10,875 premium and net of unamortized debt costs

^(1) Includes unamortized premium

National Retail Properties, Inc.Debt SummaryAs of September 30, 2021

Credit Facility and Note Covenants

The following is a summary of key financial covenants for the company's unsecured credit facility and notes, as defined and calculated per the terms of the facility's credit agreement and the notes' governing documents, respectively, which are included in the company's filings with the Commission. These calculations, which are not based on U.S. GAAP measurements, are presented to investors to show that as of September 30, 2021, the company believes it is in compliance with the covenants.

Unsecured Credit Facility Key Covenants Required September 30, 2021

Maximum leverage ratio < 0.60 0.36

Minimum fixed charge coverage ratio > 1.50 4.40

Maximum secured indebtedness ratio < 0.40 0.001

Unencumbered asset value ratio > 1.67 2.85

Unencumbered interest ratio > 1.75 5.03

Unsecured Notes Key Covenants Required September 30, 2021

Limitation on incurrence of total debt ? 60% 39.1%

Limitation on incurrence of secured debt ? 40% 0.1%

Debt service coverage ratio ? 1.50 4.54

Maintenance of total unencumbered assets ? 150% 256%

National Retail Properties, Inc.

Property Portfolio

Top 20 Lines of Trade

% of Rent As of Collections September 30, Quarter Ended

2021^ 2020^ SeptemberLine of Trade (1) (2) 30, 2021^(3)

1. Convenience stores 17.6 % 18.2 % 99.8 %

2. Automotive service 12.1 % 10.2 % 99.7 %

3. Restaurants - full service 9.9 % 10.5 % 94.7 %

4. Restaurants - limited service 9.0 % 8.8 % 99.7 %

5. Family entertainment centers 5.9 % 6.7 % 99.8 %

6. Health and fitness 5.1 % 5.3 % 100.0 %

7. Theaters 4.5 % 4.5 % 99.8 %

8. Recreational vehicle dealers, parts 4.0 % 3.5 % 99.8 % and accessories

9. Equipment rental 3.2 % 2.6 % 100.0 %

10. Automotive parts 3.1 % 3.1 % 98.3 %

11. Home improvement 2.5 % 2.6 % 99.5 %

12. Wholesale clubs 2.5 % 2.6 % 99.4 %

13. Medical service providers 2.1 % 2.2 % 98.1 %

14. Furniture 1.7 % 1.7 % 99.8 %

15. General merchandise 1.7 % 1.7 % 100.0 %

16. Consumer electronics 1.5 % 1.5 % 100.0 %

17. Home furnishings 1.5 % 1.6 % 100.0 %

18. Travel plazas 1.5 % 1.5 % 100.0 %

19. Drug stores 1.3 % 1.5 % 100.0 %

20. Automobile auctions, wholesale 1.3 % 1.1 % 100.0 %

Other 8.0 % 8.6 % 98.4 %

Total 100.0 % 100.0 % 99.1 %

Top 10 States

State % of Total^(1) State % of Total^(1)

1. Texas 17.1 % 6. Georgia 4.6 %

2. Florida 8.7 % 7. Indiana 4.0 %

3. Ohio 5.6 % 8. Tennessee 3.8 %

4. Illinois 5.4 % 9. Virginia 3.4 %

5. North Carolina 4.7 % 10. California 3.3 %

As a percentage of annual base rent, which is the annualized base rent for allleases in place.

^(1) $706,162,000 as of September 30, 2021.

^(2) $674,077,000 as of September 30, 2020.

^(3) Rent collections received as of October 27, 2021, excluding the repayment of amounts previously deferred according to the rent deferral lease amendments.

National Retail Properties, Inc.

Property Portfolio

Top 20 Tenants

Properties % of Total^(1)

1. 7-Eleven 139 4.9 %

2. Mister Car Wash 121 4.7 %

3. Camping World 47 4.2 %

4. LA Fitness 30 3.7 %

5. GPM Investments (Convenience Stores) 153 3.2 %

6. Flynn Restaurant Group (Taco Bell/Arby's) 204 3.1 %

7. AMC Theatre 20 2.9 %

8. Couche Tard (Pantry) 79 2.6 %

9. BJ's Wholesale Club 12 2.5 %

10. Sunoco 59 2.1 %

11. Mavis Tire Express Services 123 2.1 %

12. Frisch's Restaurants 70 1.9 %

13. Main Event 18 1.8 %

14. Fikes (Convenience Stores) 59 1.7 %

15. Chuck E. Cheese's 53 1.6 %

16. Best Buy 16 1.5 %

17. Bob Evans 106 1.5 %

18. Life Time Fitness 3 1.5 %

19. Dave & Buster's 11 1.4 %

20. Pull-A-Part 20 1.4 %

Lease Expirations^(2)

% of # of Gross Leasable % of # of Gross Leasable Total^(1) Properties Area ^(3) Total^(1) Properties Area ^(3)

2021 0.4% 16 159,000 2027 6.9% 187 2,838,000

2022 4.2% 104 1,196,000 2028 4.7% 157 1,245,000

2023 2.6% 113 1,402,000 2029 2.8% 71 987,000

2024 3.3% 93 1,455,000 2030 3.6% 105 1,185,000

2025 6.0% 193 2,029,000 2031 8.9% 198 3,039,000

2026 5.5% 216 2,123,000 Thereafter 51.1% 1,694 14,722,000

^ Based on the annual base rent of $706,162,000, which is the annualized base(1) rent for all leases in place as of September 30, 2021.

^ As of September 30, 2021, the weighted average remaining lease term is 10.6(2) years.

^ Square feet.(3)

National Retail Properties, Inc.

Rent Deferral Lease Amendments

(in thousands)

The following table outlines the rent deferred and corresponding recapturepayback by quarter of the rent deferral lease amendments executed as ofSeptember 30, 2021 (dollars in thousands):

Deferred Scheduled Repayment

Accrual Cash Total % of Accrual Cash Total % of Cumulative Basis Basis Total Basis Basis Total Total

2020 $ 33,594 $ 18,425 $ 52,019 91.7 % $ 3,239 $ 20 $ 3,259 5.7 % 5.7 %

2021 Q1 678 2,018 2,696 4.7 % 10,059 610 10,669 18.8 % 24.5 %

Q2 278 750 1,028 1.8 % 8,599 1,751 10,350 18.2 % 42.7 %

Q3 34 750 784 1.4 % 4,328 1,740 6,068 10.7 % 53.4 %

Q4 - 250 250 0.4 % 2,949 1,740 4,689 8.3 % 61.7 %

990 3,768 4,758 8.3 % 25,935 5,841 31,776 56.0 % 61.7 %

2022 Q1 - - - - 1,780 2,283 4,063 7.2 % 68.9 %

Q2 - - - - 1,729 2,284 4,013 7.1 % 76.0 %

Q3 - - - - 1,201 2,284 3,485 6.1 % 82.1 %

Q4 - - - - 681 2,284 2,965 5.2 % 87.3 %

- - - - 5,391 9,135 14,526 25.6 % 87.3 %

2023 - - - - 19 3,334 3,353 5.9 % 93.2 %

2024 - - - - - 1,932 1,932 3.4 % 96.6 %

2025 - - - - - 1,931 1,931 3.4 % 100.0 %

$ 34,584 $ 22,193 $ 56,777 $ 34,584 $ 22,193 $ 56,777

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SOURCE National Retail Properties, Inc.