NNN REIT, Inc. (NNN) Earnings Call Transcript & Summary

I'm here today with Steve Horn, President and CEO of NNN REIT. The company changed its name from National Retail Properties to NNN in April.

Can you talk about why that change was the right move right now?

Yes. So NNN REIT, it's -- in the industry, that's what we're known as NNN. If you talk to our clients, our investors, anybody we do business with, they refer to us as NNN. Not a shift in strategy by any means. If you look -- if you were going to e-mail me, steve.horn@nnnreit. If I call you, our caller ID is NNN REIT. So that's all it was. It's just making us who we are and who we're known as. But there's plenty of runway with our current strategy. So it's just identifying us, NNN.

NNN has a 5-year average annual dividend growth rate of 3%. In what ways are you able to achieve that?

That's our strategy. We take the long-term view. We don't get caught up chasing the acquisition market. What we focus on is FFF (sic) [ FFO ] per share growth. So as long as we're hitting FFO growth per share, we have the ability to raise our dividend. It's been 33 consecutive years. It should be 34 this year and going forward. But yes, we really stretch on our dividend, meaning it's a very important asset, intangible asset to our company. And going forward, it should be growing.

And what is your outlook for the remainder of 2023 acquisition cycle more broadly?

Yes. In broad terms, I'm expecting the cycle to continue how it was. A lot of people are being prudent with their capital. We guided Wall Street, $550 million. We did about $150 million in the first quarter. So we're going to keep that cadence. Cap rates started increasing. They've kind of plateaued a little bit, but I'm expecting to see a stair step. But the market is still robust. There's plenty of opportunity. The banking crisis has kind of helped the sale leaseback, and that's our model where tenants are having a hard time sourcing debt. The #1 competitor we've always had was the banks. And now banks aren't lending as relative as they did. So I expect the market will be pretty robust going forward.