Item 2. Properties
Item 2. Properties.
Our Real Estate Investment Portfolio
As of December 31, 2025, we had a portfolio of 2,300 properties, inclusive of one undeveloped land parcel and 150 properties that secure our investments in mortgage loans receivable, that was diversified by tenant, concept, industry and geography and had annualized base rent of $555.0 million. Our tenants operate 659 different concepts across 48 states. None of our tenants represented more than 3.4% of our portfolio at December 31, 2025 and our top ten largest tenants represented 16.5% of our annualized base rent as of that date.
As of December 31, 2025, 97.3% of our leases (based on annualized base rent) were triple-net, where the tenant is typically responsible for all improvements and is contractually obligated to pay all operating expenses, such as maintenance, insurance, utility and tax expense, related to the leased property. Due to the triple-net structure of our leases, we do not expect to incur significant capital expenditures relating to our triple-net leased properties, and the potential impact of inflation on our operating expenses is reduced.
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Diversification by Tenant
As of December 31, 2025, our top ten tenants included ten different concepts. The following table details information about our tenants and the related concepts they operate as of December 31, 2025 (dollars in thousands):
Tenant (1)
Concept Number of
Properties (2)
Annualized
Base Rent % of
Annualized
Base Rent
EquipmentShare.com Inc. EquipmentShare 57 $ 18,934 3.4 %
Express Wash Operations, LLC Whistle Express Car Wash 33 10,900 2.0 %
CNP Holdings, LLC Chicken N Pickle 8 8,641 1.6 %
BW Ultimate Parent, LLC Allsup's/YesWay 13 8,337 1.5 %
Dave & Buster's Inc. Dave & Buster's 5 8,078 1.5 %
Undefeated Tribe Operating Company, LLC Crunch Fitness 13 7,823 1.4 %
Busy Bees US Holdings Limited Various 32 7,344 1.3 %
Early Foundations LLC Primrose School 21 7,329 1.3 %
Denali Midco 2 LLC Super Star Car Wash 19 6,961 1.3 %
GSP Flagstop LLC Flagstop Car Wash 20 6,787 1.2 %
Top 10 Subtotal 221 91,134 16.5 %
Other 2,072 463,855 83.5 %
Total 2,293 $ 554,989 100.0 %
__________________________________________
(1) Represents tenant, guarantor or parent company.
(2) Excludes one undeveloped land parcel and six vacant properties.
Diversification by Concept
Our tenants operate their businesses across 659 concepts (i.e., brands). The following table provides information about the top ten concepts in our portfolio as of December 31, 2025 (dollars in thousands):
Concept Type of
Business Annualized
Base Rent % of
Annualized
Base Rent Number of
Properties (1)
Building
(Sq. Ft.) (1)
EquipmentShare Service $ 18,934 3.4 % 57 1,104,897
Crunch Fitness Experience 14,977 2.7 % 26 962,740
Whistle Express Car Wash Service 10,900 2.0 % 33 135,867
Chicken N Pickle Experience 8,641 1.6 % 8 279,483
Allsup's/YesWay Service 8,337 1.5 % 13 75,429
Primrose School Service 8,289 1.5 % 23 272,636
Super Star Car Wash Service 6,961 1.3 % 19 91,470
John Deere Service 6,813 1.2 % 31 654,285
Captain D's Service 6,792 1.2 % 86 223,411
Flagstop Car Wash Service 6,787 1.2 % 20 93,538
Top 10 Subtotal 97,431 17.6 % 316 3,893,756
Other 457,558 82.4 % 1,977 21,887,349
Total $ 554,989 100.0 % 2,293 25,781,105
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(1) Excludes one undeveloped land parcel and six vacant properties.
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Diversification by Industry
Our tenants' business concepts are diversified across various industries. The following table summarizes those industries as of December 31, 2025 (dollars in thousands except per sq. ft amounts):
Tenant Industry Type of
Business Annualized
Base Rent % of
Annualized
Base Rent Number of
Properties (1)
Building
(Sq. Ft.) (1)
Rent Per
Sq. Ft. (2)
Car Washes Service $ 75,854 13.7 % 220 1,083,076 $ 69.73
Medical / Dental Service 69,431 12.5 % 279 2,273,733 29.97
Early Childhood Education Service 62,970 11.3 % 255 2,773,263 22.51
Quick Service Service 48,290 8.7 % 461 1,244,290 39.87
Automotive Service Service 44,491 8.0 % 297 2,314,388 19.08
Convenience Stores Service 37,024 6.7 % 178 774,644 48.43
Casual Dining Service 33,556 6.0 % 132 936,979 35.91
Equipment Rental and Sales Service 25,746 4.6 % 88 1,759,182 14.64
Other Services Service 17,227 3.1 % 70 877,164 19.64
Pet Care Services Service 7,024 1.3 % 34 270,434 25.29
Family Dining Service 6,537 1.2 % 26 205,924 31.75
Service Subtotal 428,150 77.1 % 2,040 14,513,077 29.41
Entertainment Experience 51,530 9.3 % 72 2,523,151 19.22
Health and Fitness Experience 23,877 4.3 % 46 1,738,193 13.49
Movie Theaters Experience 4,429 0.8 % 6 293,206 15.11
Experience Subtotal 79,836 14.4 % 124 4,554,550 16.77
Other Industrial Industrial 26,718 4.8 % 62 3,673,369 7.12
Building Materials Industrial 4,808 0.9 % 24 1,297,669 3.71
Industrial Subtotal 31,526 5.7 % 86 4,971,038 6.23
Grocery Retail 14,715 2.7 % 41 1,635,542 9.00
Home Furnishings Retail 762 0.1 % 2 106,898 7.12
Retail Subtotal 15,477 2.8 % 43 1,742,440 8.88
Total/Weighted Average $ 554,989 100.0 % 2,293 25,781,105 $ 21.30
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(1) Excludes one undeveloped land parcel and six vacant properties.
(2) Excludes properties with no annualized base rent and properties under construction.
As of December 31, 2025, our tenants operating service-oriented businesses had a weighted average rent coverage ratio of 3.5x, our tenants operating experience-based businesses had a weighted average rent coverage ratio of 2.5x, our tenants operating retail businesses had a weighted average rent coverage ratio of 3.9x and our tenants operating other types of businesses had a weighted average rent coverage ratio of 8.6x.
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Diversification by Geography
Our 2,300 properties locations are located in 48 states. The following table details the geographical locations of our properties as of December 31, 2025 (dollars in thousands):
State Annualized Base Rent % of Annualized Base Rent Number of Properties Building (Sq. Ft.)
Texas $ 70,519 12.7 % 249 3,240,002
Florida 41,138 7.4 % 128 1,179,748
Georgia 36,305 6.5 % 168 1,285,477
Ohio 30,099 5.4 % 143 1,681,799
Wisconsin 25,423 4.6 % 97 1,452,393
Missouri 19,520 3.5 % 89 1,201,110
Oklahoma 19,013 3.4 % 74 992,576
North Carolina 18,177 3.3 % 86 790,650
Arizona 16,823 3.0 % 66 711,434
Illinois 16,507 3.0 % 64 789,679
Alabama 14,894 2.7 % 65 931,287
South Carolina 14,011 2.5 % 67 558,561
Michigan 13,896 2.5 % 65 1,184,067
Indiana 13,130 2.4 % 69 620,979
Pennsylvania 12,675 2.3 % 66 681,534
New Jersey 12,622 2.3 % 32 475,202
Virginia 12,426 2.2 % 38 408,583
Tennessee 12,114 2.2 % 61 434,505
Minnesota 11,373 2.0 % 44 638,333
Mississippi 10,995 2.0 % 74 411,690
Louisiana 10,586 1.9 % 37 352,037
New York 10,534 1.9 % 65 508,928
Arkansas 9,818 1.8 % 66 507,946
Colorado 8,979 1.6 % 33 367,634
California 8,369 1.5 % 21 196,715
New Mexico 8,154 1.5 % 28 187,680
Massachusetts 7,708 1.4 % 35 488,841
Kentucky 7,582 1.4 % 51 327,218
Iowa 7,540 1.4 % 35 414,813
Connecticut 7,166 1.3 % 22 555,537
Utah 6,919 1.2 % 7 528,350
Nevada 6,693 1.2 % 16 168,720
Kansas 4,914 0.9 % 18 201,900
Maryland 4,461 0.8 % 13 257,335
New Hampshire 3,719 0.7 % 13 268,937
Oregon 3,233 0.6 % 9 138,785
South Dakota 2,765 0.5 % 9 130,152
North Dakota 2,573 0.5 % 7 97,442
Washington 2,404 0.4 % 11 90,459
West Virginia 2,335 0.4 % 24 85,800
Nebraska 2,248 0.4 % 11 138,797
Vermont 1,282 0.2 % 10 80,819
Maine 1,167 0.2 % 4 71,000
Idaho 777 0.1 % 3 43,588
Rhode Island 480 0.1 % 2 22,865
Delaware 415 0.1 % 1 4,186
Wyoming 294 0.1 % 2 14,001
Alaska 214 — % 2 6,630
Total $ 554,989 100.0 % 2,300 25,926,724
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Lease Expirations
As of December 31, 2025, the weighted average remaining term of our leases was 14.4 years (based on annualized base rent), with only 5.2% of our annualized base rent attributable to leases expiring prior to January 1, 2031. The following table sets forth our lease expirations for leases in place as of December 31, 2025 (dollars in thousands):
Lease Expiration Year (1)
Annualized
Base Rent % of
Annualized
Base Rent Number of
Properties (2)
Weighted
Average Rent
Coverage Ratio (3)
2026 $ 3,444 0.6 % 25 2.9 x
2027 5,488 1.0 % 36 3.8 x
2028 4,470 0.8 % 16 3.0 x
2029 10,138 1.8 % 114 5.1 x
2030 5,382 1.0 % 51 4.0 x
2031 10,910 2.0 % 54 2.8 x
2032 13,223 2.4 % 42 4.1 x
2033 7,200 1.3 % 27 3.0 x
2034 29,169 5.3 % 190 5.8 x
2035 20,217 3.6 % 122 3.8 x
2036 38,283 6.9 % 161 3.9 x
2037 23,361 4.2 % 121 3.4 x
2038 50,720 9.1 % 186 4.3 x
2039 40,226 7.2 % 156 3.6 x
2040 45,841 8.3 % 162 4.8 x
2041 18,879 3.4 % 89 2.4 x
2042 25,831 4.7 % 123 2.8 x
2043 52,122 9.4 % 190 2.4 x
2044 46,801 8.4 % 165 2.7 x
2045 70,871 12.8 % 205 3.0 x
Thereafter 32,413 5.8 % 58 4.7 x
Total/Weighted Average $ 554,989 100.0 % 2,293 3.6 x
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(1) Expiration year of leases in place as of December 31, 2025, excluding any tenant option renewal periods that have not been exercised.
(2) Excludes one undeveloped land parcel and six vacant properties.
(3) Weighted by annualized base rent.
Unit Level Rent Coverage
Generally, we seek to acquire investments with healthy rent coverage ratios, and as of December 31, 2025, the weighted average rent coverage ratio of our portfolio was 3.6x. Our portfolio’s unit-level rent coverage ratios (by annualized base rent and excluding leases that do not report unit-level financial information) as of December 31, 2025 are displayed below:
Unit Level Coverage Ratio % of Total
≥ 2.00x 68.5 %
1.50x to 1.99x 14.8 %
1.00x to 1.49x 12.8 %
< 1.00x 3.2 %
Not reported 0.7 %
100.0 %
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Implied Tenant Credit Ratings
Tenant financial distress is typically caused by consistently poor or deteriorating operating performance, near-term liquidity issues or unexpected liabilities. To assess the probability of tenant insolvency, we utilize Moody’s Analytics RiskCalc, which is a model for predicting private company defaults based on Moody’s Analytics Credit Research Database, which incorporates both market and company-specific risk factors. The following table illustrates the portions of our annualized base rent as of December 31, 2025 attributable to leases with tenants having specified implied credit ratings based on their Moody’s RiskCalc scores:
Credit Rating NR < 1.00x 1.00 to 1.49x 1.50 to 1.99x ≥ 2.00x
CCC+ — % 0.1 % 0.5 % 0.4 % 0.4 %
B- 0.1 % 0.2 % 0.9 % 0.7 % 2.9 %
B — % 1.2 % 2.7 % 1.2 % 6.4 %
B+ 0.1 % 0.4 % 2.4 % 2.8 % 12.0 %
BB- 0.1 % 0.2 % 0.5 % 3.8 % 10.6 %
BB — % 0.5 % 1.9 % 2.8 % 6.5 %
BB+ — % — % 1.9 % 0.6 % 11.6 %
BBB- — % 0.1 % 0.9 % 0.5 % 9.3 %
BBB — % — % 0.6 % 1.5 % 3.4 %
BBB+ — % 0.3 % 0.4 % 0.3 % 1.6 %
A- — % — % 0.1 % — % 2.4 %
A — % — % — % — % 0.3 %
A+ — % — % — % — % — %
AA- — % — % — % — % — %
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NR Not reported