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Item 2. Management’s Discussion and Analysis

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 
 FORWARD-LOOKING STATEMENTS 
 This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. When used in this quarterly report, the words “estimated”, “anticipated”, “expect”, “believe”, “intend” and similar expressions are intended to identify forward-looking statements. Forward-looking statements include discussions of strategy, plans, or intentions of management. Forward-looking statements are subject to risks, uncertainties, and assumptions about Realty Income Corporation, including, among other things: 
 • Our anticipated growth strategies; 
 • Our intention to acquire additional properties and the timing of these acquisitions; 
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 • Our intention to sell properties and the timing of these property sales; 
 • Our intention to re-lease vacant properties; 
 • Anticipated trends in our business, including trends in the market for long-term, net leases of freestanding, single-tenant properties; 
 • Future expenditures for development projects; and 
 • The impact of the COVID-19 pandemic, or future pandemics, on us, our business, our tenants, or the economy generally. 
 Future events and actual results, financial and otherwise, may differ materially from the results discussed in the forward-looking statements. In particular, some of the factors that could cause actual results to differ materially are: 
 • Our continued qualification as a real estate investment trust; 
 • General domestic and foreign business and economic conditions; 
 • Competition; 
 • Fluctuating interest and currency rates; 
 • Access to debt and equity capital markets; 
 • Volatility and uncertainty in the credit markets and broader financial markets; 
 • Other risks inherent in the real estate business including tenant defaults, potential liability relating to environmental matters, illiquidity of real estate investments, and potential damages from natural disasters; 
 • Impairments in the value of our real estate assets; 
 • Changes in income tax laws and rates; 
 • The continued evolution of the COVID-19 pandemic and the measures taken to limit its spread, and its impacts on us, our business, our tenants, or the economy generally; 
 • The timing and pace of reopening efforts at the local, state and national level in response to the COVID-19 pandemic; 
 • The outcome of any legal proceedings to which we are a party or which may occur in the future; and 
 • Acts of terrorism and war. 
 Additional factors that may cause risks and uncertainties include those discussed in the sections entitled “Business”, “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K, for the fiscal year ended December 31, 2019 and those discussed in this section and the "Item 1.A.- Risk Factors" in Part II of this report. 
 Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date that this quarterly report was filed with the Securities and Exchange Commission, or SEC. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. We undertake 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 of this quarterly report or to reflect the occurrence of unanticipated events. In light of these risks and uncertainties, the forward-looking events discussed in this quarterly report might not occur. 
 
 THE COMPANY 
 Realty Income, The Monthly Dividend Company ® , is an S&P 500 company dedicated to providing stockholders with dependable monthly dividends that increase over time. The company is structured as a real estate investment trust, or REIT, requiring it annually to distribute at least 90% of its taxable income (excluding net capital gains) in the form of dividends to its stockholders. The monthly dividends are supported by the cash flow generated from real estate owned under long-term lease agreements with commercial tenants. 
 Realty Income was founded in 1969, and listed on the New York Stock Exchange (NYSE: O) in 1994. Over the past 51 years, Realty Income has been acquiring and managing freestanding commercial properties that generate rental revenue under long-term lease agreements with commercial tenants. The company is a member of the S&P 500 Dividend Aristocrats ® index for having increased its dividend every year for the last 25 consecutive years or more. 
 At June 30, 2020, we owned a diversified portfolio: 
 • Of 6,541 properties; 
 • With an occupancy rate of 98.5%, or 6,440 properties leased and 101 properties available for lease or sale; 
 • Doing business in 50 separate industries; 
 • Located in 49 U.S. states, Puerto Rico and the United Kingdom (U.K.); 
 • With approximately 106.4 million square feet of leasable space; 
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 • With a weighted average remaining lease term (excluding rights to extend a lease at the option of the tenant) of approximately 9.0 years; and 
 • With an average leasable space per property of approximately 16,270 square feet; approximately 12,000 square feet per retail property and 224,490 square feet per industrial property. 
 Of the 6,541 properties in the portfolio at June 30, 2020, 6,505, or 99.4%, are single-tenant properties, of which 6,407 were leased, and the remaining are multi–tenant properties. 
 Unless otherwise specified, references to rental revenue in the Management's Discussion and Analysis of Financial Condition and Results of Operations are exclusive of reimbursements from tenants for recoverable real estate taxes and operating expenses totaling $21.0 million and $16.4 million for the second quarters of 2020 and 2019, respectively, and $41.3 million and $33.8 million for the first six months of 2020 and 2019, respectively. 
 Investment Philosophy 
 We believe that owning an actively managed, diversified portfolio of commercial properties under long-term, net lease agreements produces consistent and predictable income over time. A net lease typically requires the tenant to be responsible for monthly rent and certain property operating expenses including property taxes, insurance, and maintenance. In addition, tenants of our properties typically pay rent increases based on: (1) increases in the consumer price index (typically subject to ceilings), (2) fixed increases, or (3) additional rent calculated as a percentage of the tenants’ gross sales above a specified level. We believe that a portfolio of properties under long-term lease agreements with commercial tenants generally produces a more predictable income stream than many other types of real estate portfolios, while continuing to offer the potential for growth in rental income. 
 Diversification is also a key component of our investment philosophy. We believe that diversification of the portfolio by tenant, industry, geography, and property type leads to more consistent and predictable income for our stockholders by reducing vulnerability that can come with any single concentration. Our investment activities have led to a diversified property portfolio that, as of June 30, 2020, consisted of 6,541 properties located in 49 U.S. states, Puerto Rico and the U.K., and doing business in 50 industries. None of the 50 industries represented in our property portfolio accounted for more than 12.0% of our rental revenue for the quarter ended June 30, 2020. 
 Investment Strategy 
 When identifying new properties for investment, we generally focus on acquiring high-quality real estate that tenants consider important to the successful operation of their business. We generally seek to acquire real estate that has the following characteristics: 
 • Properties that are freestanding, commercially-zoned with a single tenant; 
 • Properties that are in significant markets or strategic locations critical to generating revenue for our tenants (i.e. they need the property in which they operate in order to conduct their business); 
 • Properties that we deem to be profitable for the tenants and/or can generally be characterized as important to the successful operations of the company’s business; 
 • Properties that are located within attractive demographic areas relative to the business of our tenants; 
 • Properties with real estate valuations that approximate replacement costs; 
 • Properties with rental or lease payments that approximate market rents for similar properties; and 
 • Properties that can be purchased with the simultaneous execution or assumption of long-term lease agreements with commercial tenants, offering both current income and the potential for future rent increases. 
 
 
 We seek to invest in properties owned by tenants that are already or could become leaders in their respective businesses supported by mechanisms including (but not limited to) occupancy of prime real estate locations, pricing, merchandise assortment, service, quality, economies of scale, consumer branding, and advertising. In addition, we frequently acquire large portfolios of single-tenant properties net leased to different tenants operating in a variety of industries. We have an internal team dedicated to sourcing such opportunities, often using our relationships with various tenants, owners/developers, brokers and advisers to uncover and secure transactions. We also undertake thorough research and analysis to identify what we consider to be appropriate property locations, tenants, and industries for investment. This research expertise is instrumental to uncovering net lease opportunities in markets where we believe we can add value. 
 In selecting potential investments, we look for tenants with the following attributes: 
 • Tenants with reliable and sustainable cash flow; 
 • Tenants with revenue and cash flow from multiple sources; 
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 • Tenants that are willing to sign a long-term lease (10 or more years); and 
 • Tenants that are large owners and users of real estate. 
 From a retail perspective, our investment strategy is to target tenants that have a service, non-discretionary, and/or low-price-point component to their business. We believe these characteristics better position tenants to operate in a variety of economic conditions and to compete more effectively with internet retailers. As a result of the execution of this strategy, approximately 95% of our annualized retail rental revenue at June 30, 2020 is derived from tenants with a service, non-discretionary, and/or low price point component to their business. From a non-retail perspective, we target industrial properties leased to industry leaders that are primarily investment grade rated companies. We believe these characteristics enhance the stability of the rental revenue generated from these properties. 
 After applying this investment strategy, we pursue those transactions where we believe we can achieve an attractive investment spread over our cost of capital and favorable risk-adjusted returns. We will continue to evaluate all investments for consistency with our objective of owning net lease assets. 
 Underwriting Strategy 
 In order to be considered for acquisition, properties must meet stringent underwriting requirements. We have established a four-part analysis that examines each potential investment based on: 
 • The aforementioned overall real estate characteristics, including demographics, replacement cost, and comparative rental rates; 
 • Industry, tenant (including credit profile), and market conditions; 
 • Store profitability for retail locations if profitability data is available; and 
 • The importance of the real estate location to the operations of the tenants’ business. 
 
 
 We believe the principal financial obligations for most of our tenants typically include their bank and other debt, payment obligations to suppliers, and real estate lease obligations. Because we typically own the land and building in which a tenant conducts its business or which are critical to the tenant’s ability to generate revenue, we believe the risk of default on a tenant’s lease obligation is less than the tenant’s unsecured general obligations. It has been our experience that tenants must retain their profitable and critical locations in order to survive. Therefore, in the event of reorganization, we believe they are less likely to reject a lease of a profitable or critical location because this would terminate their right to use the property. 
 Thus, as the property owner, we believe that we will fare better than unsecured creditors of the same tenant in the event of reorganization. If a property is rejected by the tenant during reorganization, we own the property and can either lease it to a new tenant or sell the property. In addition, we believe that the risk of default on real estate leases can be further mitigated by monitoring the performance of the tenants’ individual locations and considering whether to proactively sell locations that meet our criteria for disposition. 
 Prior to entering into any transaction, our research department conducts a review of a tenant’s credit quality. The information reviewed may include reports and filings, including any public credit ratings, financial statements, debt and equity analyst reports, and reviews of corporate credit spreads, stock prices, market capitalization, and other financial metrics. We conduct additional due diligence, including additional financial reviews of the tenant and a more comprehensive review of the business segment and industry in which the tenant operates. We continue to monitor our tenants’ credit quality on an ongoing basis by reviewing the available information previously discussed, and providing summaries of these findings to management. At June 30, 2020, approximately 48% of our annualized rental revenue comes from properties leased to investment grade rated companies, their subsidiaries or affiliated companies. At June 30, 2020, our top 20 tenants (based on percentage of total portfolio annualized rental revenue) represented approximately 53% of our annualized revenue and 12 of these tenants have investment grade credit ratings or are subsidiaries or affiliates of investment grade companies. 
 Asset Management Strategy 
 In addition to pursuing new properties for investment, we seek to increase earnings and distributions to stockholders through active asset management. 
 Generally, our asset management efforts seek to achieve: 
 • Rent increases at the expiration of existing leases, when market conditions permit; 
 • Optimum exposure to certain tenants, industries, and markets through re-leasing vacant properties and selectively selling properties; 
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 • Maximum asset-level returns on properties that are re-leased or sold; 
 • Additional value creation from the existing portfolio by enhancing individual properties, pursuing alternative uses, and deriving ancillary revenue; and 
 • Investment opportunities in new asset classes for the portfolio. 
 We continually monitor our portfolio for any changes that could affect the performance of our tenants, our tenants’ industries, and the real estate locations in which we have invested. We also regularly analyze our portfolio with a view towards optimizing its returns and enhancing its overall credit quality. Our active asset management strategy pursues asset sales when we believe the reinvestment of the sale proceeds will: 
 • Generate higher returns; 
 • Enhance the credit quality of our real estate portfolio; 
 • Extend our average remaining lease term; and/or 
 • Strategically decrease tenant, industry, or geographic concentration. 
 The active management of the portfolio is an essential component of our long-term strategy of maintaining high occupancy. 
 Impact of Real Estate and Credit Markets 
 In the commercial real estate market, property prices generally continue to fluctuate. Likewise, during certain periods, including the current market, the global credit markets have experienced significant price volatility, dislocations, and liquidity disruptions, which may impact our access to and cost of capital. We continually monitor the commercial real estate and global credit markets carefully and, if required, will make decisions to adjust our business strategy accordingly. 
 
 
 
 RECENT DEVELOPMENTS 
 Increases in Monthly Dividends to Common Stockholders 
 We have continued our 51-year policy of paying monthly dividends. In addition, we increased the dividend four times during 2020. As of April 2020, we have paid 91 consecutive quarterly dividend increases and increased the dividend 107 times since our listing on the NYSE in 1994. 
 
 
 The following table summarizes our dividend increases in 2020: 
 
 2020 Dividend increases 
 Month 
 Declared 
 Month 
 Paid 
 Dividend 
 per share 
 Increase 
 per share 
 
 1st increase Dec 2019 Jan 2020 $ 0.2275 $ 0.0005 
 2nd increase Jan 2020 Feb 2020 $ 0.2325 $ 0.0050 
 3rd increase Mar 2020 Apr 2020 $ 0.2330 $ 0.0005 
 4th increase Jun 2020 Jul 2020 $ 0.2335 $ 0.0005 
 
 

 The dividends paid per share during the first six months of 2020 totaled approximately $1.392, as compared to approximately $1.350 during the first six months of 2019, an increase of $0.042, or 3.1%. 
 The monthly dividend of $0.2335 per share represents a current annualized dividend of $2.802 per share, and an annualized dividend yield of approximately 4.7% based on the last reported sale price of our common stock on the NYSE of $59.50 on June 30, 2020. Although we expect to continue our policy of paying monthly dividends, we cannot guarantee that we will maintain our current level of dividends, that we will continue our pattern of increasing dividends per share, or what our actual dividend yield will be in any future period. 
 
 
 
 
 
 
 
 
 
 
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 Acquisitions During the Second Quarter and First Six Months of 2020 
 Below is a listing of our acquisitions in the U.S. and U.K. for the periods indicated below: 
 
 Number of
Properties Square Feet
(in millions) Investment
($ in millions) Weighted
Average
Lease Term
(Years) Initial
Average
Cash Lease
Yield 
 Three months ended June 30, 2020 (1) 
 
 Acquisitions - U.S. (in 15 states) 
 26 0.4 $ 94.3 12.9 6.4 % 
 Acquisitions - U.K. (2) 
 2 0.1 58.2 9.9 6.1 % 
 Total acquisitions 28 0.5 152.5 11.8 6.3 % 
 Properties under development - U.S. 4 0.1 1.7 10.4 10.3 % 
 Total (3) 
 32 0.6 $ 154.2 11.8 6.3 % 
 
 Six months ended June 30, 2020 (1) 
 
 Acquisitions - U.S. (in 25 states) 
 80 1.8 $ 412.6 14.4 6.5 % 
 Acquisitions - U.K. (2) 
 6 0.5 223.7 11.8 5.3 % 
 Total acquisitions 86 2.3 636.3 13.6 6.1 % 
 Properties under development - U.S. 8 0.2 3.9 10.5 8.8 % 
 Total (4) 
 94 2.5 $ 640.2 13.6 6.1 % 
 
 
 
 
 
 
 

 (1) None of our investments during the three and six months ended June 30, 2020 caused any one tenant to be 10% or more of our total assets at June 30, 2020. All of our investments in acquired properties during the three and six months ended June 30, 2020 are 100% leased at the acquisition date. 
 (2) Represents investments of £46.8 million during the three months ended June 30, 2020 and £180.1 million during the six months ended June 30, 2020 converted at the applicable exchange rate on the date of acquisition. 
 (3) The tenants occupying the new properties operate in 8 industries, and are 100.0% retail, based on rental revenue. Approximately 41% of the rental revenue generated from acquisitions during the second quarter of 2020 is from investment grade rated tenants, their subsidiaries or affiliated companies. 
 (4) The tenants occupying the new properties operate in 17 industries, and are 96.5% retail and 3.5% industrial, based on rental revenue. Approximately 37% of the rental revenue generated from acquisitions during the first six months of 2020 is from investment grade rated tenants, their subsidiaries or affiliated companies. 
 
 
 The initial average cash lease yield for a property is generally computed as estimated contractual first year cash net operating income, which, in the case of a net leased property, is equal to the aggregate cash base rent for the first full year of each lease, divided by the total cost of the property. Since it is possible that a tenant could default on the payment of contractual rent, we cannot provide assurance that the actual return on the funds invested will remain at the percentages listed above. 
 
 In the case of a property under development or expansion, the contractual lease rate is generally fixed such that rent varies based on the actual total investment in order to provide a fixed rate of return. When the lease does not provide for a fixed rate of return on a property under development or expansion, the initial average cash lease yield is computed as follows: estimated cash net operating income (determined by the lease) for the first full year of each lease, divided by our projected total investment in the property, including land, construction and capitalized interest costs. We may continue to pursue development or expansion opportunities under similar arrangements in the future. 
 Portfolio Discussion 
 Leasing Results 
 At June 30, 2020, we had 101 properties available for lease or sale out of 6,541 properties in our portfolio, which represents a 98.5% occupancy rate based on the number of properties in our portfolio. 
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 The following tables summarizes our leasing results for the periods indicated below: 
 
 Properties available for lease at March 31, 2020 
 97 
 Lease expirations 81 
 Re-leases to same tenant (1) 
 (60) 
 Re-leases to new tenant (1)(2) 
 (5) 
 Vacant Dispositions (12) 
 Properties available for lease at June 30, 2020 
 101 

 (1) The annual new rent on these re-leases was $15.334 million, as compared to the previous annual rent of $15.128 million on the same properties, representing a rent recapture rate of 101.4% on the properties re-leased during the quarter ended June 30, 2020. 
 (2) Re-leased two properties to new tenants without a period of vacancy, and three properties to new tenants after a period of vacancy. 
 
 Properties available for lease at December 31, 2019 
 94 
 Lease expirations 190 
 Re-leases to same tenant (1) 
 (150) 
 Re-leases to new tenant (1)(2) 
 (8) 
 Vacant Dispositions (25) 
 Properties available for lease at June 30, 2020 
 101 

 (1) The annual new rent on these re-leases was $33.152 million, as compared to the previous annual rent of $33.124 million on the same properties, representing a rent recapture rate of 100.1% on the properties re-leased during the first six months of 2020. 
 (2) Re-leased three properties to new tenants without a period of vacancy, and five properties to new tenants after a period of vacancy. 
 As part of our re-leasing costs, we pay leasing commissions to unrelated, third party real estate brokers consistent with the commercial real estate industry standard, and sometimes provide tenant rent concessions. We do not consider the collective impact of the leasing commissions or tenant rent concessions to be material to our financial position or results of operations. 
 At June 30, 2020, our average annualized rental revenue was approximately $15.17 per square foot on the 6,440 leased properties in our portfolio. At June 30, 2020, we classified 32 properties, with a carrying amount of $40.6 million, as held for sale on our balance sheet. The expected sale of these properties does not represent a strategic shift that will have a major effect on our operations and financial results and is consistent with our existing disposition strategy to further enhance our real estate portfolio and maximize portfolio returns. 
 Investments in Existing Properties 
 In the second quarter of 2020, we capitalized costs of $2.3 million on existing properties in our portfolio, consisting of $973,000 for re-leasing costs, $23,000 for recurring capital expenditures, and $1.3 million for non-recurring building improvements. In the first six months of 2020, we capitalized costs of $4.4 million on existing properties in our portfolio, consisting of $1.1 million for re-leasing costs, $23,000 for recurring capital expenditures, and $3.3 million for non-recurring building improvements. 
 The majority of our building improvements relate to roof repairs, HVAC improvements, and parking lot resurfacing and replacements. The amounts of our capital expenditures can vary significantly, depending on the rental market, tenant credit worthiness, the lease term and the willingness of tenants to pay higher rents over the terms of the leases. 
 We define recurring capital expenditures as mandatory and recurring landlord capital expenditure obligations that have a limited useful life. We define non-recurring capital expenditures as property improvements in which we invest additional capital that extend the useful life of the properties. 
 Note Issuances 
 In July 2020, we issued $350 million of additional aggregate amount of our existing 3.250% senior unsecured notes due in January 2031, or the 2031 Notes. The public offering price for these notes was 108.241% of the principal amount, for an effective yield to maturity of 2.341% and gross proceeds of approximately $378.8 million. 
 
 
 In May 2020, we issued $600 million of the 2031 Notes. The public offering price for the 2031 Notes was 98.987% of the principal amount, for an effective yield to maturity of 3.364% and gross proceeds of approximately $593.9 million. 
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 The proceeds from each of these offerings were used to repay borrowings outstanding under our credit facility, to fund investment opportunities, and for other general corporate purposes. 
 Equity Capital Raising 
 During the second quarter of 2020, we raised $98.1 million from the sale of common stock at a weighted average price of $63.07, primarily through our At-The-Market-Program. 
 
 
 During the first six months of 2020, we raised $850.6 million from the sale of common stock at a weighted average price of $75.40 , primarily from 9,690,500 shares issued in an overnight underwritten public offering during the first quarter of 2020, including 690,500 shares purchased by the underwriters upon the exercise of their option to purchase additional shares. 
 Term Loan Redemption 
 In June 2020, we repaid the $250.0 million term loan in full upon maturity. 
 Chief Financial Officer Departure 
 In March 2020 and as previously announced, Paul Meurer, our former EVP, Chief Financial Officer ("CFO"), departed from the Company. We continue our search for a new CFO. As a result of Mr. Meurer's departure, we recognized an executive severance charge of $3.5 million during the first quarter of 2020, consisting of $1.6 million of cash, $1.8 million related to share–based compensation expense and $58,000 of professional fees. 
 Early Redemption of 5.75% Notes Due January 2021 
 In January 2020, we completed the early redemption on all $250.0 million in principal amount of our outstanding 5.750% notes due January 2021, plus accrued and unpaid interest. As a result of the early redemption, we recognized a $9.8 million loss on extinguishment of debt during the first quarter of 2020. 
 Impact of COVID-19 
 The COVID-19 pandemic and the measures taken to limit its spread are negatively impacting global, national and regional economies across many industries, including the industries in which some of our tenants operate, and have disrupted the businesses and operations of some of our tenants, each of which has had and may continue to have an adverse impact on our business, results of operations, financial condition, and liquidity. These impacts may increase in severity as the duration of the pandemic lengthens. See "Item 1A--Risk Factors" in Part II of this report for more information regarding the actual and potential future impacts of the COVID-19 pandemic and the measures taken to limit its spread on our tenants and our business, results of operations, financial condition and liquidity. 
 
 
 As a result of this challenging environment, we continue to work diligently with our tenants most affected by the pandemic to understand their financial liquidity and their ability to satisfy their contractual obligations to us. As we carefully navigate this difficult economic period with our tenants, our focus is on finding resolutions that preserve the long-term relationships we have built with many of our tenants. 
 
 
 The majority of concessions granted to our tenants during the second quarter of 2020 as a result of the COVID-19 pandemic have been rent deferrals with the original lease term unchanged. In these cases, we have currently determined that the collection of deferred rent is probable. In addition, as we believe to be the case with many retail landlords, we received many short-term rent relief requests, most often in the form of rent deferral requests, or requests for further discussion from tenants. We believe that not all tenant requests will ultimately result in modification agreements, nor have we relinquished our contractual rights under our lease agreements for leases in which rent concessions have not yet been granted. Our collections and concessions from April through July 2020 and our rent relief requests to-date may not be indicative of collections, concessions or requests in any future period. 
 
 
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 Percentages of Contractual Rent Collected as of July 31, 2020 
 
 Month Ended
April 30, 2020 Month Ended
May 31, 2020 Month Ended
June 30, 2020 Quarter Ended
June 30, 2020 Month Ended
July 31, 2020 
 
 
 Contractual rent collected (1) across total 
 portfolio 
 88.4% 84.9% 86.1% 86.5% 91.5% 
 Contractual rent collected (1) from top 20 
 tenants (2) 
 83.0% 82.1% 82.5% 82.5% 90.7% 
 Contractual rent collected (1) from 
 investment grade tenants (3) 
 100.0% 98.4% 98.9% 99.1% 100.0% 

 (1) Contractual rent is the aggregate cash amount charged to tenants inclusive of monthly base rent receivables. U.K. rent (which is payable in pounds Sterling) was converted at the exchange rate in effect on May 1, 2020 for rents collected for the month of April 2020, on June 1, 2020 for rents collected for the month of May 2020, on July 1, 2020 for rents collected for the month of June 2020, and on July 31, 2020 for rents collected for the month of July 2020. 
 (2) We define top 20 tenants as our 20 largest tenants based on percentage of total portfolio annualized contractual rental revenue as of the last day of such period. 
 (3) We define investment grade tenants as tenants with a credit rating, and tenants that are subsidiaries or affiliates of companies with a credit rating, of Baa3/BBB- or higher from one of the three major rating agencies (Moody’s/S&P/Fitch). 
 
 
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 The following table provides information relating to April through July 2020 rent collections by industry through July 31, 2020: 
 
 Percentage of Total Contractual Rent Due Percentage of Total Contractual Rent Collected as of: 
 July 2020 (1) 
 June 2020 (1) 
 May 2020 (1) 
 April 2020 (1) 
 July 2020 (1) 
 June 2020 (1) 
 May 2020 (1) 
 April 2020 (1) 
 
 U.S. 
 Aerospace 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 
 Apparel stores 1.3 1.3 1.3 1.2 1.3 1.1 0.9 1.2 
 Automotive collision services 1.1 1.0 1.0 1.0 1.1 1.0 1.0 1.0 
 Automotive parts 1.6 1.6 1.6 1.6 1.5 1.6 1.6 1.6 
 Automotive service 2.5 2.5 2.5 2.5 2.3 1.9 2.0 2.5 
 Automotive tire services 2.0 2.0 2.0 2.1 2.0 1.9 1.7 2.1 
 Beverages 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 
 Child care 2.2 2.1 2.2 2.1 1.8 1.6 0.7 1.6 
 Consumer electronics 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 
 Consumer goods 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 
 Convenience stores 12.2 12.1 12.0 12.1 12.1 12.0 11.9 12.0 
 Crafts and novelties 0.8 0.8 0.7 0.7 0.8 0.8 0.7 0.6 
 Diversified industrial 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 
 Dollar stores 7.9 7.9 7.9 7.9 7.9 7.9 7.9 7.9 
 Drug stores 8.5 8.5 8.5 8.6 8.5 8.5 8.5 8.6 
 Education 0.2 0.2 0.2 0.2 0.1 0.2 0.2 0.2 
 Electric utilities 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 
 Entertainment 0.3 0.3 0.3 0.3 0.1 0.1 0.2 0.3 
 Equipment services 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 
 Financial services 1.9 1.9 1.9 1.9 1.9 1.9 1.9 1.9 
 Food processing 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 
 General merchandise 2.8 2.8 2.8 2.8 2.8 2.8 2.8 2.8 
 Government services 0.7 0.7 0.7 0.7 0.7 0.7 0.6 0.6 
 Grocery stores 5.0 5.1 5.1 5.1 5.0 5.1 5.1 5.1 
 Health and beauty 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 
 Health and fitness 7.1 7.1 7.2 7.2 6.3 3.0 3.5 3.6 
 Health care 1.6 1.6 1.6 1.6 1.6 1.6 1.6 1.6 
 Home furnishings 0.8 0.8 0.8 0.9 0.7 0.7 0.4 0.5 
 Home improvement 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 
 Machinery 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 
 Motor vehicle dealerships 1.6 1.6 1.6 1.6 1.6 1.6 1.6 1.6 
 Office supplies 0.2 0.2 0.2 0.2 0.1 0.1 0.1 0.1 
 Other manufacturing 0.6 0.6 0.6 0.6 0.5 0.5 0.5 0.6 
 Packaging 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.9 
 Paper 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 
 Pet supplies and services 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 
 Restaurants - casual dining 3.1 3.1 3.1 3.1 2.7 2.7 2.5 2.7 
 Restaurants - quick service 5.7 5.7 5.7 5.7 5.0 4.8 4.5 5.3 
 Shoe stores 0.2 0.2 0.2 0.2 * * * 0.2 
 Sporting goods 0.8 0.8 0.8 0.8 0.8 0.6 0.8 0.8 
 Telecommunications 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 
 Theaters 5.9 6.0 5.9 6.0 0.9 — 0.2 0.2 
 Transportation services 4.2 4.2 4.2 4.2 4.2 4.2 4.2 4.2 
 Wholesale clubs 2.4 2.4 2.4 2.4 2.4 2.4 2.4 2.4 
 Other 0.1 0.2 0.2 0.2 0.1 0.1 0.1 0.1 
 Total U.S. 96.2% 96.2% 96.1% 96.4% 87.7% 82.3% 81.0% 84.8% 
 U.K. 
 Grocery stores 3.7 3.7 3.8 3.5 3.7 3.7 3.8 3.5 
 Theaters * * * * — — — — 
 Health care 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 
 Total U.K. 3.8% 3.8% 3.9% 3.6% 3.8% 3.8% 3.9% 3.6% 
 Totals 100.0% 100.0% 100.0% 100.0% 91.5% 86.1% 84.9% 88.4% 

 * Less than 0.1% 
 (1) Contractual rent is the aggregate cash amount charged to tenants inclusive of monthly base rent receivables. U.K. rent (which is payable in pounds Sterling) was converted at the exchange rate in effect on May 1, 2020 for rents collected for the month of April 2020, on June 1, 2020 for rents collected for the month of May 2020, on July 1, 2020 for rents collected for the month of June 2020, and on July 31, 2020 for rents collected for the month of July 2020. 
 
 
 As the adverse impacts of the COVID-19 pandemic and the measures taken to limit its spread continue to evolve, the ability of our tenants to continue to pay rent to us may further diminish, and therefore we cannot assure you that our rental collections from April through July are indicative of our rental collections in August or in the future. As a result of the impacts of the COVID-19 pandemic and the measures taken to limit its spread, our revenues in the 
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 second half of 2020 may decline relative to the first half of 2020, and that decline may continue or increase in subsequent periods as long as such impacts continue to exist. 
 Summarized Financial Results 
 The following summarizes our select financial results (dollars in millions, except per share data): 
 
 % Increase 
 Three months ended June 30, Six months ended June 30, Three months Six months 
 
 2020 2019 2020 2019 
 Total revenue 
 $ 414.6 $ 365.5 $ 829.0 $ 719.8 13.4 % 15.2 % 
 Net income available to common stockholders (1) 
 $ 107.8 $ 95.2 $ 254.7 $ 206.1 13.2 % 23.6 % 
 Net income per share (2) 
 $ 0.31 $ 0.31 $ 0.75 $ 0.67 — % 11.9 % 
 Funds from operations (FFO) available to common stockholders 
 $ 288.3 $ 251.5 $ 565.4 $ 497.2 14.6 % 13.7 % 
 FFO per share (2) 
 $ 0.84 $ 0.81 $ 1.66 $ 1.62 3.7 % 2.5 % 
 Adjusted funds from operations (AFFO) available to common stockholders 
 $ 295.2 $ 253.9 $ 592.5 $ 502.7 16.3 % 17.9 % 
 AFFO per share (2) 
 $ 0.86 $ 0.82 $ 1.74 $ 1.63 4.9 % 6.7 % 

 (1) The calculation to determine net income available to common stockholders includes provisions for impairment, gains from the sale of real estate, and foreign currency gains and losses. These items can vary from quarter to quarter and can significantly impact net income available to common stockholders and period to period comparisons. 
 (2) All per share amounts are presented on a diluted per common share basis. 
 Net income available to common stockholders and FFO in the first six months of 2020 were impacted by the following transactions recorded in the first quarter of 2020: (i) a $9.8 million loss on extinguishment of debt due to the January 2020 early redemption of the 5.750% notes due 2021, and (ii) a $3.5 million executive severance charge for our former chief financial officer. 
 See our discussion of FFO and AFFO (which are not financial measures under generally accepted accounting principles, or GAAP), later in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in this quarterly report, which includes a reconciliation of net income available to common stockholders to FFO and AFFO. 
 
 LIQUIDITY AND CAPITAL RESOURCES 
 Capital Philosophy 
 Historically, we have met our long-term capital needs by issuing common stock, preferred stock and long-term unsecured notes and bonds. Over the long term, we believe that common stock should be the majority of our capital structure; however, we may issue preferred stock or debt securities. We may issue common stock when we believe that our share price is at a level that allows for the proceeds of any offering to be accretively invested into additional properties. In addition, we may issue common stock to permanently finance properties that were initially financed by our revolving credit facility or debt securities. However, we cannot assure you that we will have access to the capital markets at all times and at terms that are acceptable to us. 
 
 
 Our primary cash obligations, for the current year and subsequent years, are included in the “Table of Obligations,” which is presented later in this section. We expect to fund our operating expenses and other short-term liquidity requirements, including property acquisitions and development costs, payment of principal and interest on our outstanding indebtedness, property improvements, re-leasing costs and cash distributions to common stockholders, primarily through cash provided by operating activities, borrowing on our credit facility and through public securities offerings. 
 Conservative Capital Structure 
 We believe that our stockholders are best served by a conservative capital structure. Therefore, we seek to maintain a conservative debt level on our balance sheet and solid interest and fixed charge coverage ratios. At June 30, 2020, our total outstanding borrowings of senior unsecured notes and bonds, term loans, mortgages payable and credit facility borrowings were $7.91 billion, or approximately 27.8% of our total market capitalization of $28.47 billion. 
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 We define our total market capitalization at June 30, 2020 as the sum of: 
 • Shares of our common stock outstanding of 345,023,421, plus total common units outstanding of 463,119, multiplied by the last reported sales price of our common stock on the NYSE of $59.50 per share on June 30, 2020, or $20.56 billion; 
 • Outstanding borrowings of $628.6 million on our revolving credit facility, including £329.5 million British Pounds Sterling-denominated borrowings; 
 • Outstanding mortgages payable of $393.7 million, excluding net mortgage premiums of $2.3 million and deferred financing costs of $1.1 million; 
 • Outstanding borrowings of $250.0 million on our term loan, excluding deferred financing costs of $742,000; and 
 • Outstanding senior unsecured notes and bonds of $6.64 billion, including a Sterling-denominated private placement of £315.0 million, and excluding unamortized net original issuance premiums of $3,000 and deferred financing costs of $38.5 million. 
 Universal Shelf Registration 
 In November 2018, we filed a shelf registration statement with the SEC, which is effective for a term of three years and will expire in November 2021. In accordance with SEC rules, the amount of securities to be issued pursuant to this shelf registration statement was not specified when it was filed and there is no specific dollar limit. The securities covered by this registration statement include (1) common stock, (2) preferred stock, (3) debt securities, (4) depositary shares representing fractional interests in shares of preferred stock, (5) warrants to purchase debt securities, common stock, preferred stock, or depositary shares, and (6) any combination of these securities. We may periodically offer one or more of these securities in amounts, prices and on terms to be announced when and if these securities are offered. The specifics of any future offerings, along with the use of proceeds of any securities offered, will be described in detail in a prospectus supplement, or other offering materials, at the time of any offering. 
 At-the-Market (ATM) Program 
 Under our "at-the-market" equity distribution plan, or our ATM program, up to 33,402,405 shares of common stock may be offered and sold (1) by us to, or through, a consortium of banks acting as our sales agents or (2) by a consortium of banks acting as forward sellers on behalf of any forward purchasers contemplated thereunder, in each case by means of ordinary brokers' transactions on the NYSE at prevailing market prices or at negotiated prices. During the second quarter and first six months of 2020, we issued 1,511,149 shares and raised approximately $95.7 million under the ATM program. At June 30, 2020, we had 31,891,256 shares remaining for future issuance under our ATM program. We anticipate maintaining the availability of our ATM program in the future, including the replenishment of authorized shares issuable thereunder. 
 Issuance of Common Stock 
 In March 2020, we issued 9,690,500 shares of common stock in an overnight underwritten public offering, including 690,500 shares purchased by the underwriters upon the exercise of their option to purchase additional shares. After deducting underwriting discounts and other offering costs of $21.2 million, the net proceeds of $728.9 million were primarily used to repay borrowings under our revolving credit facility. 
 Dividend Reinvestment and Stock Purchase Plan 
 Our Dividend Reinvestment and Stock Purchase Plan, or our DRSPP, provides our common stockholders, as well as new investors, with a convenient and economical method of purchasing our common stock and reinvesting their distributions. Our DRSPP also allows our current stockholders to buy additional shares of common stock by reinvesting all or a portion of their distributions. Our DRSPP authorizes up to 26,000,000 common shares to be issued. Our DRSPP includes a waiver approval process, allowing larger investors or institutions, per a formal approval process, to purchase shares at a small discount, if approved by us. We did not issue shares under the waiver approval process during the first six months of 2020. At June 30, 2020, we had 11,573,851 shares remaining for future issuance under our DRSPP program. During the second quarter of 2020, we issued 44,817 shares and raised approximately $2.4 million under our DRSPP. During the first six months of 2020, we issued 78,817 shares and raised approximately $4.8 million under our DRSPP. 
 Revolving Credit Facility 
 We have a $3.0 billion unsecured revolving credit facility with an initial term that expires in March 2023 and includes, at our option, two six-month extensions. The multicurrency revolving facility allows us to borrow in up to 14 currencies, including U.S. dollars. Our revolving credit facility has a $1.0 billion expansion option, which is subject to obtaining lender commitments. Under our revolving credit facility, our investment grade credit ratings as of June 30, 
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 2020 provide for financing at the London Interbank Offered Rate, commonly referred to as LIBOR, plus 0.775% with a facility commitment fee of 0.125%, for all-in drawn pricing of 0.90% over LIBOR. 
 
 
 The borrowing rate is subject to an interest rate floor and may change if our investment grade credit ratings change. We also have other interest rate options available to us under our credit facility. Our credit facility is unsecured and, accordingly, we have not pledged any assets as collateral for this obligation. 
 At June 30, 2020, we had a borrowing capacity of $2.4 billion available on our revolving credit facility and an outstanding balance of $628.6 million, including £329.5 million Sterling. The weighted average interest rate on borrowings under our revolving credit facility during the first six months of 2020 was 1.6% per annum. We must comply with various financial and other covenants in our credit facility. At June 30, 2020, we were in compliance with these covenants. We expect to use our credit facility to acquire additional properties and for other general corporate purposes. Any additional borrowings will increase our exposure to interest rate risk. 
 We generally use our credit facility for the short-term financing of new property acquisitions. Thereafter, we generally seek to refinance those borrowings with the net proceeds of long-term or permanent financing, which may include the issuance of common stock, preferred stock or debt securities. We cannot assure you, however, that we will be able to obtain any such refinancing, or that market conditions prevailing at the time of the refinancing will enable us to issue equity or debt securities at acceptable terms. We regularly review our credit facility and may seek to extend, renew or replace our credit facility, to the extent we deem appropriate. 
 Term Loans 
 In October 2018, in conjunction with entering into our revolving credit facility, we entered into a $250.0 million senior unsecured term loan, which matures in March 2024, and is governed by the credit agreement that governs our revolving credit facility. Borrowing under this term loan bears interest at the current one-month LIBOR, plus 0.85%. In conjunction with this term loan, we also entered into an interest rate swap which effectively fixes our per annum interest on this term loan at 3.89%. 
 In June 2015, in conjunction with entering into our previous revolving credit facility, we entered into a $250.0 million senior unsecured term loan which matured in June 2020. Borrowing under this term loan bore interest at the current one-month LIBOR, plus 0.90%. In conjunction with this term loan, we also entered into an interest rate swap which effectively fixed our per annum interest rate on this term loan at 2.62%. In June 2020, we repaid the term loan in full upon maturity. 
 Mortgage Debt 
 As of June 30, 2020, we had $393.7 million of mortgages payable, all of which were assumed in connection with our property acquisitions. Additionally, at June 30, 2020, we had net premiums totaling $2.3 million on these mortgages and deferred financing costs of $1.1 million. We expect to pay off the mortgages payable as soon as prepayment penalties have declined to a level that would make it economically feasible to do so. During the first six months of 2020, we made $14.7 million in principal payments, including the repayment of one mortgage in full for $11.4 million. 
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 Notes Outstanding 
 Our senior unsecured note and bond obligations consist of the following as of June 30, 2020, sorted by maturity date (dollars in millions): 
 
 3.250% notes, $450 issued in October 2012 and $500 issued in December 2017, both due in October 2022 
 $ 950 
 4.650% notes, issued in July 2013 and due in August 2023 750 
 3.875% notes, issued in June 2014 and due in July 2024 350 
 3.875% notes, issued in April 2018 and due in April 2025 500 
 4.125% notes, $250 issued in September 2014 and $400 issued in March 2017, both due in October 2026 650 
 3.000% notes, issued in October 2016 and due in January 2027 600 
 3.650% notes, issued in December 2017 and due in January 2028 550 
 3.250% notes, issued in June 2019 and due in June 2029 500 
 3.250% notes, issued in May 2020 and due in January 2031 600 
 2.730% notes, issued in May 2019 and due in May 2034 (1) 
 391 
 5.875% bonds, $100 issued in March 2005 and $150 issued in June 2011, both due in March 2035 250 
 4.650% notes, $300 issued in March 2017 and $250 issued in December 2017, both due in March 2047 550 
 Total principal amount $ 6,641 
 Unamortized net original issuance premiums and deferred financing costs (39) 
 $ 6,602 

 (1) Represents the principal balance (in U.S. dollars) of the Sterling-denominated private placement of £315.0 million converted at the applicable exchange rate on June 30, 2020. 
 In July 2020, we issued $350 million of 3.250% senior unsecured notes due in January 2031, which constituted a further issuance of, and formed a single series with, the $600 million senior notes issued in May 2020. The public offering price for these notes was 108.24% of the principal amount, for an effective yield to maturity of 2.341%. The net proceeds of approximately $376.6 million from this offering were used to repay borrowings under our credit facility, to fund potential investment opportunities and for other general corporate purposes. 
 All of our outstanding notes and bonds have fixed interest rates and contain various covenants, with which we remained in compliance as of June 30, 2020. Additionally, interest on all of our senior note and bond obligations is paid semiannually. 
 The following is a summary of the key financial covenants for our senior unsecured notes, as defined and calculated per the terms of our senior notes and bonds. These calculations, which are not based on U.S. GAAP measurements, are presented to investors to show our ability to incur additional debt under the terms of our senior notes and bonds as well as to disclose our current compliance with such covenants, and are not measures of our liquidity or performance. The actual amounts as of June 30, 2020 are: 
 
 Note Covenants 
 Required 
 Actual 
 
 Limitation on incurrence of total debt 
 < 60% of adjusted assets 
 38.1 % 
 Limitation on incurrence of secured debt 
 < 40% of adjusted assets 
 1.9 % 
 Debt service coverage (trailing 12 months) (1) 
 > 1.5x 
 5.4x 
 Maintenance of total unencumbered assets 
 > 150% of unsecured debt 
 267.3 % 

 (1) Our debt service coverage ratio is calculated on a pro forma basis for the preceding four-quarter period on the assumptions that: (i) the incurrence of any debt (as defined in the covenants) incurred by us since the first day of such four-quarter period and the application of the proceeds therefrom (including to refinance other debt since the first day of such four-quarter period), (ii) the repayment or retirement of any of our debt since the first day of such four-quarter period, and (iii) any acquisition or disposition by us of any asset or group since the first day of such four quarters had in each case occurred on July 1, 2019 and subject to certain additional adjustments. Such pro forma ratio has been prepared on the basis required by that debt service covenant, reflects various estimates and assumptions and is subject to other uncertainties, and therefore does not purport to reflect what our actual debt service coverage ratio would have been had transactions referred to in clauses (i), (ii) and (iii) of the preceding sentence occurred as of July 1, 2019, nor does it purport to reflect our debt service coverage ratio for any future period. The following is our calculation of debt service and fixed charge coverage at June 30, 2020 (in thousands, for trailing twelve months): 
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 Net income available to common stockholders 
 $ 484,997 
 Plus: interest expense, excluding the amortization of deferred financing costs 
 292,348 
 Plus: loss on extinguishment of debt 
 9,819 
 Plus: provision for taxes 
 9,159 
 Plus: depreciation and amortization 
 638,931 
 Plus: provisions for impairment 
 40,800 
 Plus: pro forma adjustments 
 71,742 
 Less: gain on sales of real estate 
 (55,671) 
 
 Income available for debt service, as defined 
 $ 1,492,125 
 
 Total pro forma debt service charge 
 $ 278,214 
 
 Debt service and fixed charge coverage ratio 
 5.4 

 Cash Reserves 
 We are organized to operate as an equity REIT that acquires and leases properties and distributes to stockholders, in the form of monthly cash distributions, a substantial portion of our net cash flow generated from leases on our properties. We intend to retain an appropriate amount of cash as working capital. At June 30, 2020, we had cash and cash equivalents totaling $35.3 million, inclusive of £14.6 million Sterling. 
 
 
 During the second quarter of 2020 we invested in a term deposit with a bank that was not readily convertible to cash as of June 30, 2020. The term deposit matured on July 24. 2020. 
 We believe that our cash and cash equivalents on hand, cash provided from operating activities, and borrowing capacity is sufficient to meet our liquidity needs for the next twelve months. We intend, however, to use permanent or long-term capital to fund property acquisitions and to repay future borrowings under our credit facility. 
 Credit Agency Ratings 
 The borrowing interest rates under our revolving credit facility are based upon our ratings assigned by credit rating agencies. As of June 30, 2020, we were assigned the following investment grade corporate credit ratings on our senior unsecured notes and bonds: Moody’s Investors Service has assigned a rating of A3 with a “stable” outlook, Standard & Poor’s Ratings Group has assigned a rating of A- with a “stable” outlook, and Fitch Ratings has assigned a rating of BBB+ with a “stable” outlook. 
 
 
 Based on our ratings as of June 30, 2020, the facility interest rate was LIBOR, plus 0.775% with a facility commitment fee of 0.125%, for all-in drawn pricing of 0.90% over LIBOR. Our credit facility provides that the interest rate can range between: (i) LIBOR, plus 1.45% if our credit rating is lower than BBB-/Baa3 or unrated and (ii) LIBOR, plus 0.75% if our credit rating is A/A2 or higher. In addition, our credit facility provides for a facility commitment fee based on our credit ratings, which range from: (i) 0.30% for a rating lower than BBB-/Baa3 or unrated, and (ii) 0.10% for a credit rating of A/A2 or higher. 
 We also issue senior debt securities from time to time and our credit ratings can impact the interest rates charged in those transactions. If our credit ratings or ratings outlook change, our cost to obtain debt financing could increase or decrease. The credit ratings assigned to us could change based upon, among other things, our results of operations and financial condition. These ratings are subject to ongoing evaluation by credit rating agencies and we cannot assure you that our ratings will not be changed or withdrawn by a rating agency in the future if, in its judgment, circumstances warrant. Moreover, a rating is not a recommendation to buy, sell or hold our debt securities, preferred stock or common stock. 
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 Table of Obligations 
 The following table summarizes the maturity of each of our obligations as of June 30, 2020 (dollars in millions): 
 
 Year of
Maturity Credit 
 Facility (1) 
 Notes and 
 Bonds (2) 
 Term 
 Loan (3) 
 Mortgages 
 Payable (4) 
 Interest (5) 
 Ground 
 Leases Paid by 
 Realty Income (6) 
 Ground 
 Leases Paid by 
 Our Tenants (7) 
 Other (8) 
 Totals 
 2020 — — — 69.5 136.4 0.8 6.8 7.9 221.4 
 2021 — — — 68.8 279.6 1.5 13.5 7.9 371.3 
 2022 — 950.0 — 111.8 275.8 1.5 13.4 — 1,352.5 
 2023 628.6 750.0 — 20.6 236.8 1.4 13.5 — 1,650.9 
 2024 — 350.0 250.0 112.2 192.3 1.4 13.6 — 919.5 
 Thereafter — 4,590.6 — 10.8 1,212.7 18.8 69.1 — 5,902.0 
 Totals $ 628.6 $ 6,640.6 $ 250.0 $ 393.7 $ 2,333.6 $ 25.4 $ 129.9 $ 15.8 $ 10,417.6 

 (1) The initial term of the credit facility expires in March 2023 and includes, at our option, two six-month extensions. 
 (2) Excludes non-cash original issuance discounts and premiums recorded on notes payable of $3,000 and deferred financing costs of $38.5 million. Also excludes the July 2020 issuance of $350 million of senior unsecured notes. 
 (3) Excludes deferred financing costs of $742,000. In June 2020, we repaid our $250.0 million senior term loan in full, which matured in June 2020. 
 (4) Excludes both non-cash net premiums recorded on the mortgages payable of $2.3 million and deferred financing costs of $1.1 million. 
 (5) Interest on the term loans, notes, bonds, mortgages payable, and credit facility has been calculated based on outstanding balances at period end through their respective maturity dates. 
 (6) Realty Income currently pays the ground lessors directly for the rent under the ground leases. 
 (7) Our tenants, who are generally sub-tenants under ground leases, are responsible for paying the rent under these ground leases. In the event a tenant fails to pay the ground lease rent, we are primarily responsible. 
 (8) “Other” consists of $3.6 million of commitments under construction contracts and $12.2 million for re-leasing costs, recurring capital expenditures, and non-recurring building improvements. 
 Our revolving credit facility, term loans, and notes payable obligations are unsecured. Accordingly, we have not pledged any assets as collateral for these obligations. 
 No Unconsolidated Investments 
 We have no unconsolidated investments, nor do we engage in trading activities involving energy or commodity contracts. 
 Dividend Policy 
 Distributions are paid monthly to holders of shares of our common stock. 
 Distributions are paid monthly to the limited partners holding common units of Realty Income, L.P. on a per unit basis that is generally equal to the amount paid per share to our common stockholders. 
 In order to maintain our status as a REIT for federal income tax purposes, we generally are required to distribute dividends to our stockholders aggregating annually at least 90% of our taxable income (excluding net capital gains), and we are subject to income tax to the extent we distribute less than 100% of our taxable income (including net capital gains). In 2019, our cash distributions to common stockholders totaled $852.1 million, or approximately 131.5% of our estimated taxable income of $648.0 million. Our estimated taxable income reflects non-cash deductions for depreciation and amortization. Our estimated taxable income is presented to show our compliance with REIT dividend requirements and is not a measure of our liquidity or operating performance. We intend to continue to make distributions to our stockholders that are sufficient to meet this dividend requirement and that will reduce or eliminate our exposure to income taxes. Furthermore, we believe our funds from operations and cash on hand are sufficient to support our current level of cash distributions to our stockholders. Our cash distributions to common stockholders in the first six months of 2020 totaled $474.3 million, representing 80.1% of our adjusted funds from operations available to common stockholders of $592.5 million. In comparison, our 2019 cash distributions to common stockholders totaled $852.1 million, representing 81.2% of our adjusted funds from operations available to common stockholders of $1.05 billion. 
 
 
 Future distributions will be at the discretion of our Board of Directors and will depend on, among other things, our results of operations, FFO, AFFO, cash flow from operations, financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Internal Revenue Code of 1986, as amended, or the Code, our debt service requirements, and any other factors the Board of Directors may deem relevant. In addition, our credit facility contains financial covenants that could limit the amount of distributions payable by us in the event of a default, and which prohibit the payment of distributions on the common or preferred stock in the event that we 
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 fail to pay when due (subject to any applicable grace period) any principal or interest on borrowings under our credit facility. 
 
 
 Distributions of our current and accumulated earnings and profits for federal income tax purposes generally will be taxable to stockholders as ordinary income, except to the extent that we recognize capital gains and declare a capital gains dividend, or that such amounts constitute “qualified dividend income” subject to a reduced rate of tax. The maximum tax rate of non-corporate taxpayers for “qualified dividend income” is generally 20%. In general, dividends payable by REITs are not eligible for the reduced tax rate on qualified dividend income, except to the extent that certain holding requirements have been met with respect to the REIT’s stock and the REIT’s dividends are attributable to dividends received from certain taxable corporations (such as our taxable REIT subsidiaries) or to income that was subject to tax at the corporate or REIT level (for example, if we distribute taxable income that we retained and paid tax on in the prior taxable year). However, non-corporate stockholders, including individuals, generally may deduct up to 20% of dividends from a REIT, other than capital gain dividends and dividends treated as qualified dividend income, for taxable years beginning after December 31, 2017 and before January 1, 2026. 
 Distributions in excess of earnings and profits generally will first be treated as a non-taxable reduction in the stockholders’ basis in their stock, but not below zero. Distributions in excess of that basis generally will be taxable as a capital gain to stockholders who hold their shares as a capital asset. 
 
 RESULTS OF OPERATIONS 
 Critical Accounting Policies 
 Our consolidated financial statements have been prepared in accordance with GAAP, and are the basis for our discussion and analysis of financial condition and results of operations. Preparing our consolidated financial statements requires us to make a number of estimates and assumptions that affect the reported amounts and disclosures in the consolidated financial statements. We believe that we have made these estimates and assumptions in an appropriate manner and in a way that accurately reflects our financial condition. We continually test and evaluate these estimates and assumptions using our historical knowledge of the business, as well as other factors, to ensure that they are reasonable for reporting purposes. However, actual results may differ from these estimates and assumptions. This summary should be read in conjunction with the more complete discussion of our accounting policies and procedures included in note 2 to our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2019. 
 
 
 In order to prepare our consolidated financial statements according to the rules and guidelines set forth by GAAP, many subjective judgments must be made with regard to critical accounting policies. Management must make significant assumptions in determining the fair value of assets acquired and liabilities assumed. When acquiring a property for investment purposes, we typically allocate the cost of real estate acquired, inclusive of transaction costs, to: (1) land, (2) building and improvements, and (3) identified intangible assets and liabilities, based in each case on their relative estimated fair values. Intangible assets and liabilities consist of above-market or below-market lease value and the value of in-place leases, as applicable. Additionally, above–market rents on certain leases under which we are a lessor are accounted for as financing receivables amortizing over the lease term, while below–market rents on certain leases under which we are a lessor are accounted for as prepaid rent. In an acquisition of multiple properties, we must also allocate the purchase price among the properties. The allocation of the purchase price is based on our assessment of estimated fair value of the land, building and improvements, and identified intangible assets and liabilities and is often based upon the various characteristics of the market where the property is located. In addition, any assumed mortgages are recorded at their estimated fair values. The estimated fair values of our mortgages payable have been calculated by discounting the future cash flows using applicable interest rates that have been adjusted for factors, such as industry type, tenant investment grade, maturity date, and comparable borrowings for similar assets. The use of different assumptions in the allocation of the purchase price of the acquired properties and liabilities assumed could affect the timing of recognition of the related revenue and expenses. 
 
 
 Another significant judgment must be made as to if, and when, impairment losses should be taken on our properties when events or a change in circumstances indicate that the carrying amount of the asset may not be recoverable. A provision is made for impairment if estimated future operating cash flows (undiscounted and without interest charges) plus estimated disposition proceeds (undiscounted) are less than the current book value of the property. Key inputs that we utilize in this analysis include projected rental rates, estimated holding periods, capital expenditures, and property sales capitalization rates. If a property is held for sale, it is carried at the lower of carrying cost or estimated fair value, less estimated cost to sell. The carrying value of our real estate is the largest 
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 component of our consolidated balance sheets. Our strategy of primarily holding properties, long-term, directly decreases the likelihood of their carrying values not being recoverable, thus requiring the recognition of an impairment. However, if our strategy, or one or more of the above assumptions were to change in the future, an impairment may need to be recognized. If events should occur that require us to reduce the carrying value of our real estate by recording provisions for impairment, they could have a material impact on our results of operations. 
 The COVID-19 pandemic and the measures taken to limit its spread are negatively impacting the economy across many industries, including the industries in which some of our tenants operate. These impacts may continue and increase in severity as the duration of the pandemic lengthens, which may, in turn, adversely impact the fair value estimates of our real estate and require the recording of impairments on our properties. As a result, we evaluated certain key assumptions involving fair value estimates of our real estate, recording of impairments on our properties and collectibility of our accounts receivable during the second quarter of 2020. We continue to evaluate the potential impacts of the COVID-19 pandemic and the measures taken to limit its spread on our business and industry segments, as the situation continues to evolve and more information becomes available. 
 
 
 When assessing the collectability of future lease payments, one of the key factors we have considered during 2020 has been the COVID-19 pandemic. We generally assess collectability based on an analysis of creditworthiness, economic trends, and other facts and circumstances related to the applicable tenants. If the collection of substantially all of the future lease payments is less than probable, we will write-off the receivable balances associated with the lease and cease to recognize lease income, including straight-line rent, unless cash is received when due. As of June 30, 2020, we do not have any further tenant specific information that would change our assessment that collection of substantially all of the future lease payments under our existing leases is probable. However, there may be impacts in future periods that could change this assessment as the situation continues to evolve and as more information becomes available. 
 The following is a comparison of our results of operations for the three and six months ended June 30, 2020, to the three and six months ended June 30, 2019. 
 Total Revenue 
 The following summarizes our total revenue (dollars in thousands): 
 
 Three months ended June 30, Six months ended June 30, Increase 
 2020 2019 2020 2019 Three months Six months 
 
 REVENUE 
 
 Rental (excluding reimbursable) 
 $ 389,237 $ 347,847 $ 781,028 $ 684,538 $ 41,390 $ 96,490 
 Rental (reimbursable) 
 20,964 16,405 41,330 33,751 4,559 7,579 
 Other 
 4,435 1,198 6,619 1,526 3,237 5,093 
 Total revenue 
 $ 414,636 $ 365,450 $ 828,977 $ 719,815 $ 49,186 $ 109,162 

 Rental Revenue (excluding reimbursable) 
 The increase in rental revenue (excluding reimbursable) in the second quarter of 2020 compared to the second quarter of 2019 is primarily attributable to: 
 
 
 • The 87 properties (2.3 million square feet) we acquired in 2020, which generated $8.7 million of rent in the second quarter of 2020; 
 • The 779 properties (13.4 million square feet) we acquired in 2019, which generated $58.3 million of rent in the second quarter of 2020, compared to $15.7 million in the second quarter of 2019, an increase of $42.6 million; partially offset by 
 • Same store rents generated on 5,539 properties (86.7 million square feet) during the second quarter of 2020 and 2019, decreased by $1.4 million, or (0.4)%, to $315.65 million from $317.02 million; 
 • A net decrease in straight-line rent and other non-cash adjustments to rent of $4.3 million in the second quarter of 2020 as compared to the second quarter of 2019; 
 • A net decrease of $2.8 million relating to properties sold in the second quarter of 2020 and throughout 2019 that were reported in continuing operations; and 
 • A net decrease of $1.4 million relating to the aggregate of (i) rental revenue from properties (130 properties comprising 2.9 million square feet) that were available for lease during part of 2020 or 2019, (ii) rental revenue for eight properties under development, and (iii) lease termination settlements. In aggregate, the 
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 revenues for these items totaled $5.5 million in the second quarter of 2020, compared to $6.9 million in the second quarter of 2019. 
 
 
 The increase in rental revenue (excluding reimbursable) in the first six months of 2020 compared to the first six months of 2019 is primarily attributable to: 
 
 
 • The 87 properties (2.3 million square feet) we acquired in the first six months of 2020, which generated $11.9 million of rent in the first six months of 2020; 
 • The 779 properties (13.4 million square feet) we acquired in 2019, which generated $117.4 million of rent in the first six months of 2020, compared to $18.8 million in the first six months of 2019, an increase of $98.6 million; partially offset by 
 • Same store rents generated on 5,539 properties (86.7 million square feet) during the first six months of 2020 and 2019, decreased by $1.1 million or (0.2)%, to $635.6 million from $636.7 million; 
 • A net decrease in straight-line rent and other non-cash adjustments to rent of $4.9 million in the first six months of 2020 as compared to the first six months of 2019; 
 • A net decrease of $5.8 million relating to properties sold in the first six months of 2020 and during 2019 that were reported in continuing operations; and 
 • A net decrease of $2.2 million relating to the aggregate of (i) rental revenue from properties (130 properties comprising 2.9 million square feet) that were available for lease during part of 2020 or 2019, (ii) rental revenue for eight properties under development, and (iii) lease termination settlements. In aggregate, the revenues for these items totaled $11.89 million in the first six months of 2020 compared to $14.14 million in the first six months of 2019. 
 For purposes of determining the same store rent property pool, we include all properties that were owned for the entire year-to-date period, for both the current and prior year, except for properties during the current or prior year that; (i) were vacant at any time, (ii) were under development or redevelopment, or (iii) were involved in eminent domain and rent was reduced. Each of the exclusions from the same store pool are separately addressed within the applicable sentences above, explaining the changes in rental revenue for the period. 
 
 
 Our calculation of same store rental revenue for the three and six months ended June 30, 2020 includes $12.9 million of rent deferred for future payment as a result of lease concessions we granted in response to the COVID-19 pandemic and recognized under the practical expedient provided by the Financial Accounting Standards Board (FASB). Our calculation of same store rental revenue for these periods also includes $35.9 million of uncollected rent from the second quarter of 2020 for which we have not granted a lease concession. If these applicable amounts of rent deferrals and uncollected rent were excluded from our calculation of same store rental revenue, the decreases for the second quarter and first six months of 2020 would have been (14.1)% and (6.5)%, respectively, compared to the three and six months ended June 30, 2019. 
 Of the 6,541 properties in the portfolio at June 30, 2020, 6,505, or 99.4%, are single-tenant properties and the remaining are multi-tenant properties. Of the 6,505 single-tenant properties, 6,407, or 98.5%, were net leased at June 30, 2020. Of our 6,407 leased single-tenant properties, 5,448 or 85.0% were under leases that provide for increases in rents through: 
 • Base rent increases tied to a consumer price index (typically subject to ceilings); 
 • Percentage rent based on a percentage of the tenants’ gross sales; 
 • Fixed increases; or 
 • A combination of two or more of the above rent provisions. 
 Percentage rent, which is included in rental revenue, was $547,000 in the second quarter of 2020, $495,000 in the second quarter of 2019, $1.8 million in the first six months of 2020, and $4.1 million in the first six months of 2019. We anticipate percentage rent to be less than 1% of rental revenue for 2020. 
 At June 30, 2020, our portfolio of 6,541 properties was 98.5% leased with 101 properties available for lease, as compared to 98.6% leased, with 94 properties available for lease at December 31, 2019, and 98.3% leased with 102 properties available for lease at June 30, 2019. It has been our experience that approximately 1% to 4% of our property portfolio will be unleased at any given time; however, it is possible that the number of properties available for lease or sale could increase in the future, given the nature of economic cycles and other unforeseen global events, such as the ongoing COVID-19 pandemic and the measures taken to limit its spread. 
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 Rental Revenue (reimbursable) 
 A number of our leases provide for contractually obligated reimbursements from tenants for recoverable real estate taxes and operating expenses. The increase in tenant reimbursements for the periods presented is primarily due to the growth of our portfolio due to acquisitions. 
 Other Revenue 
 The increase in other revenue in the second quarter and first six months of 2020 compared to the same periods of 2019 was primarily related to interest income recognized on financing receivables for certain leases with above-market terms as compared to the first three months of 2019. In addition, interest income from our short term investment and money market accounts was higher during the second quarter and first six months of 2020 than the comparative periods in 2019, which is primarily due to higher average investment balances. 
 Total Expenses 
 The following summarizes our total expenses (dollars in thousands): 
 
 Three months ended June 30, Six months ended June 30, $ Increase 
 2020 2019 2020 2019 Three months Six months 
 
 EXPENSES 
 
 Depreciation and amortization 
 $ 168,328 $ 150,426 $ 332,913 $ 287,943 $ 17,902 $ 44,970 
 Interest 
 77,841 72,488 153,766 142,508 5,353 11,258 
 Property (excluding reimbursable) 
 5,488 4,937 10,728 9,227 551 1,501 
 Property (reimbursable) 
 20,964 16,405 41,330 33,751 4,559 7,579 
 General and administrative (1) 
 19,063 18,585 40,027 33,693 478 6,334 
 Income taxes 
 2,838 1,155 5,601 2,600 1,683 3,001 
 Provisions for impairment 
 13,869 13,061 18,347 17,733 808 614 
 Total expenses 
 $ 308,391 $ 277,057 $ 602,712 $ 527,455 $ 31,334 $ 75,257 
 Total revenue (2) 
 $ 393,672 $ 349,045 $ 787,647 $ 686,064 
 
 
 
 
 General and administrative expenses as a percentage of total revenue (1)(2) 
 4.8 % 5.3 % 4.6 % 4.9 % 
 
 
 
 
 Property expenses (excluding reimbursable) as a percentage of total revenue (2) 
 1.4 % 1.4 % 1.4 % 1.3 % 
 
 
 
 

 (1) General and administrative expenses for the first six months of 2020 included an executive severance charge related to the departure of our former CFO in March 2020. The total value of cash, stock compensation and professional fees incurred as a result of this severance was $3,463 and was recorded to general and administrative expense (see our discussion of Adjusted Funds from Operations Available to Common Stockholders, or AFFO, which is not a financial measure under generally accepted accounting principles). In order to present a normalized calculation of our general and administrative expenses as a percentage of total revenue for the first six months of 2020, we have excluded this executive severance charge to arrive at a normalized general and administrative amount of $36,564, which was used for our calculation. 
 (2) Excludes rental revenue (reimbursable). 
 Depreciation and Amortization 
 The increase in depreciation and amortization in the second quarter and first six months of 2020 was primarily due to the acquisition of properties in 2019 and the first six months of 2020, which was partially offset by property sales in those same periods. As discussed in the sections entitled “Funds from Operations Available to Common Stockholders (FFO)” and “Adjusted Funds from Operations Available to Common Stockholders (AFFO),” depreciation and amortization is a non-cash item that is added back to net income available to common stockholders for our calculation of FFO and AFFO. 
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 Interest Expense 
 The following is a summary of the components of our interest expense (dollars in thousands): 
 
 Three months ended June 30, Six months ended June 30, 
 2020 2019 2020 2019 
 Interest on our credit facility, term loans, notes, mortgages and interest rate swaps 
 $ 73,622 $ 69,383 $ 145,817 $ 136,358 
 Credit facility commitment fees 
 948 948 1,896 1,885 
 Amortization of debt origination and deferred financing costs 
 2,420 2,206 5,168 4,378 
 Loss on interest rate swaps 
 1,306 686 1,993 1,365 
 Amortization of net mortgage premiums 
 (356) (354) (710) (708) 
 Amortization of net note premiums 
 (162) (281) (406) (573) 
 Other items 
 63 (100) 8 (197) 
 Interest expense 
 $ 77,841 $ 72,488 $ 153,766 $ 142,508 
 
 Credit facility, term loans, mortgages and notes 
 
 Average outstanding balances (dollars in thousands) 
 $ 8,534,969 $ 7,061,775 $ 8,195,899 $ 6,907,450 
 Average interest rates 
 3.33 % 3.92 % 3.46 % 3.95 % 

 The increase in interest expense from 2019 to 2020 for the second quarter and first six months is primarily due to the May 2019 issuance of our 2.730% notes due 2034, the June 2019 issuance of our 3.250% notes due 2029, the May 2020 initial issuance of our 3.250% notes due in 2031, higher interest related to mortgages assumed during December 2019 and interest rate swaps, partially offset by the January 2020 repayment of our 5.750% notes due 2021, and lower average interest rates. 
 During the first six months of 2020, the weighted average interest rate on our: 
 • Revolving credit facility outstanding borrowings of $628.6 million was 1.6%; 
 • Term loan outstanding of $250.0 million (excluding deferred financing costs of $742,000 and considering that one of our $250.0 million term loans was paid off in June 2020) was 2.0%; 
 • Mortgages payable of $393.7 million (excluding net premiums totaling $2.3 million and deferred financing costs of $1.1 million on these mortgages) was 4.9%; 
 • Notes and bonds payable of $6.64 billion (excluding net unamortized original issue premiums of $3,000 and deferred financing costs of $38.5 million) was 3.8%; and 
 • Combined outstanding notes, bonds, mortgages, term loan and revolving credit facility borrowings of $7.91 billion (excluding all net premiums and deferred financing costs) was 3.5%. 
 Property Expenses (excluding reimbursable) 
 Property expenses (excluding reimbursable) consist of costs associated with unleased properties, non-net-leased properties and general portfolio expenses. Expenses related to unleased properties and non-net-leased properties include, but are not limited to, property taxes, maintenance, insurance, utilities, property inspections and legal fees. General portfolio costs include, but are not limited to, insurance, legal, property inspections, and title search fees. At June 30, 2020, 101 properties were available for lease or sale, as compared to 94 at December 31, 2019, and 102 at June 30, 2019. 
 
 
 The increase in property expenses (excluding reimbursable) for the second quarter of 2020 is primarily due to higher property insurance, partially offset by lower property taxes. The increase in property expenses (excluding reimbursable) in the first six months of 2020 is primarily attributable to higher property insurance, repairs and maintenance, partially offset by lower property taxes. 
 Property Expenses (reimbursable) 
 The increase in property expenses (reimbursable) in the second quarter and first six months of 2020 was primarily attributable to the increased portfolio size, which contributed to higher contractually obligated reimbursements from tenants for recoverable real estate taxes and operating expenses primarily due to our acquisitions in each period. 
 
 
 
 
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 General and Administrative Expenses 
 General and administrative expenses are expenditures related to the operations of our company, including employee–related costs, professional fees, and other general overhead costs associated with running our business. 
 
 
 General and administrative expenses increased during the second quarter of 2020 primarily due to higher payroll-related costs, partially offset by lower costs for terminated acquisitions. In July 2020, we had 201 employees, as compared to 174 employees in July 2019. General and administrative expenses increased during the first six months of 2020 primarily due to a severance charge of $3.5 million for our former CFO, who departed the company in March 2020, higher payroll-related costs, and higher corporate–level professional fees, partially offset by lower costs for terminated acquisitions. 
 Income Taxes 
 Income taxes are for city and state income and franchise taxes, and for U.K. income taxes accrued or paid by us and our subsidiaries. The increase in income taxes in the second quarter and first six months of 2020 was primarily attributable to our U.K. investments, which contributed to higher U.K. income taxes as compared to the second quarter and first six months of 2019. 
 Provisions for Impairment 
 The following table summarizes provisions for impairment during the periods indicated below (dollars in millions): 
 
 Three months ended June 30, Six months ended June 30, 
 2020 2019 2020 2019 
 Total provisions for impairment $ 13.9 $ 13.1 $ 18.3 $ 17.7 
 Number of properties: 
 Classified as held for sale 7 — 8 — 
 Classified as held for investment 11 2 14 2 
 Sold 7 12 14 22 

 During the second quarter of 2020, we assessed the key assumptions used in our impairment analysis for the impact of the COVID-19 pandemic on our portfolio, focusing on tenants experiencing difficulties meeting their lease obligations to us. As a result of this analysis, we determined that the carrying values of eight properties classified as held for investment were not recoverable. As a result, we recorded provisions for impairments of $8.2 million on these properties, which are included as part of our total impairments recorded during the second quarter of 2020. 
 Gain on Sales of Real Estate 
 The following table summarizes our properties sold during the periods indicated below (dollars in millions): 
 
 Three months ended June 30, Six months ended June 30, 
 2020 2019 2020 2019 
 Number of properties sold 12 18 29 37 
 Net sales proceeds $ 7.4 $ 28.6 $ 133.6 $ 51.1 
 Gain on sales of real estate $ 1.3 $ 6.9 $ 39.8 $ 14.2 

 Foreign Currency and Derivative Losses/Gains, Net 
 We borrow in the functional currencies of the countries in which we invest. Foreign currency gains and losses are primarily a result of intercompany debt and certain remeasurement transactions. 
 
 
 Loss on Extinguishment of Debt 
 In January 2020, we completed the early redemption on all $250.0 million in principal amount of outstanding 5.75% notes due January 2021, plus accrued and unpaid interest. As a result of the early redemption, we recognized a $9.8 million loss on extinguishment of debt during the first six months of 2020. 
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 Net Income Available to Common Stockholders 
 The following summarizes our net income available to common stockholders (dollars in millions, except per share data): 
 
 % Increase 
 Three months ended June 30, Six months ended June 30, Three months Six 
 months 
 
 2020 2019 2020 2019 
 Net income available to common stockholders 
 $ 107.8 $ 95.2 $ 254.7 $ 206.1 13.2 % 23.6 % 
 Net income per share (1) 
 $ 0.31 $ 0.31 $ 0.75 $ 0.67 — % 11.9 % 

 (1) All per share amounts are presented on a diluted per common share basis. 
 The calculation to determine net income available to common stockholders includes provisions for impairment, gains from the sale of properties, and foreign currency gains and losses, which can vary from period to period based on timing and significantly impact net income available to the Company and available to common stockholders. 
 Net income available to common stockholders and FFO in the first six months of 2020 were impacted by the following transactions recorded in the first quarter of 2020: (1) a $9.8 million loss on extinguishment of debt due to the January 2020 early redemption of the 5.750% notes due 2021, and (2) a $3.5 million executive severance charge for our former chief financial officer. 
 Adjusted Earnings before Interest, Taxes, Depreciation and Amortization for Real Estate (Adjusted EBITDA re ) 
 The National Association of Real Estate Investment Trusts (Nareit) came to the conclusion that a Nareit-defined EBITDA metric for real estate companies (i.e., EBITDA for real estate, or EBITDA re ) would provide investors with a consistent measure to help make investment decisions among REITs. Our definition of “Adjusted EBITDA re ” is generally consistent with the Nareit definition, other than our adjustments to remove foreign currency and derivative gains and losses (which is consistent with our previous calculations of "Adjusted EBITDA"). We define Adjusted EBITDA re , a non–GAAP financial measure, for the most recent quarter as earnings (net income) before (i) interest expense, including non-cash loss (gain) on swaps, (ii) income and franchise taxes, (iii) real estate depreciation and amortization, (iv) provisions for impairment, (v) gain on sales of real estate, and (vi) foreign currency and derivative gains and losses, net (as described in the Adjusted Funds from Operations section). Our Adjusted EBITDA re may not be comparable to Adjusted EBITDA re reported by other companies or as defined by Nareit, and other companies may interpret or define Adjusted EBITDA re differently than we do. Management believes Adjusted EBITDA re to be a meaningful measure of a REIT’s performance because it is widely followed by industry analysts, lenders and investors. Management also believes the use of an annualized quarterly Adjusted EBITDA re metric is meaningful because it represents the company’s current earnings run rate for the period presented. The ratio of our total debt to our annualized quarterly Adjusted EBITDA re is also used to determine vesting of performance share awards granted to our executive officers. Adjusted EBITDA re should be considered along with, but not as an alternative to net income as a measure of our operating performance. Our ratio of net debt-to-Adjusted EBITDA re , which is used by management as a measure of leverage, is calculated as net debt (which we define as total debt per the consolidated balance sheet, less cash and cash equivalents and short term investments maturing within 30 days) divided by annualized quarterly Adjusted EBITDA re . 
 
 
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 The following table summarizes our Adjusted EBITDA re calculation for the periods indicated below (dollars in thousands): 
 
 Three months ended June 30, 
 2020 2019 
 Net income 
 $ 108,070 $ 95,420 
 Interest 
 77,841 72,488 
 Income taxes 
 2,838 1,155 
 Depreciation and amortization 
 168,328 150,426 
 Provisions for impairment 
 13,869 13,061 
 Gain on sales of real estate 
 (1,323) (6,891) 
 Foreign currency and derivative gains, net (502) (136) 
 Quarterly Adjusted EBITDA re 
 $ 369,121 $ 325,523 
 
 Net Debt 
 $ 7,539,432 $ 7,047,152 
 Annualized Adjusted EBITDA re (1) 
 $ 1,476,484 $ 1,302,092 
 Net Debt/Adjusted EBITDA re 
 5.1 5.4 

 (1) We calculate Annualized Adjusted EBITDA re by multiplying the Quarterly Adjusted EBITDA re by four. 
 
 FUNDS FROM OPERATIONS AVAILABLE TO COMMON STOCKHOLDERS (FFO) 
 The following summarizes our funds from operations available to common stockholders (dollars in millions, except per share data): 
 
 % Increase 
 Three months ended June 30, Six months ended June 30, Three months Six 
 months 
 
 2020 2019 2020 2019 
 FFO available to common 
 stockholders 
 $ 288.3 $ 251.5 $ 565.4 $ 497.2 14.6 % 13.7 % 
 FFO per share (1) 
 $ 0.84 $ 0.81 $ 1.66 $ 1.62 3.7 % 2.5 % 

 (1) All per share amounts are presented on a diluted per common share basis. 
 FFO in the first six months of 2020 were impacted by a loss on extinguishment of debt due to the early redemption of the 5.750% Notes due 2021 in January 2020 and an executive severance charge for our former CFO in March 2020. 
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 The following is a reconciliation of net income available to common stockholders (which we believe is the most comparable GAAP measure) to FFO. Also presented is information regarding distributions paid to common stockholders and the weighted average number of common shares used for the basic and diluted computation per share (dollars in thousands, except per share amounts): 
 
 Three months ended June 30, Six months ended June 30, 
 2020 2019 2020 2019 
 Net income available to common stockholders 
 $ 107,824 $ 95,194 $ 254,651 $ 206,136 
 Depreciation and amortization 
 168,328 150,426 332,913 287,943 
 Depreciation of furniture, fixtures and equipment 
 (152) (147) (278) (302) 
 Provisions for impairment 
 13,869 13,061 18,347 17,733 
 Gain on sales of real estate 
 (1,323) (6,891) (39,829) (14,154) 
 FFO adjustments allocable to noncontrolling interests 
 (208) (154) (363) (192) 
 FFO available to common stockholders 
 $ 288,338 $ 251,489 $ 565,441 $ 497,164 
 FFO allocable to dilutive noncontrolling interests 
 348 362 717 670 
 Diluted FFO 
 $ 288,686 $ 251,851 $ 566,158 $ 497,834 
 
 FFO per common share, basic and diluted 
 $ 0.84 $ 0.81 $ 1.66 $ 1.62 
 
 Distributions paid to common stockholders 
 $ 240,470 $ 208,864 $ 474,294 $ 413,410 
 FFO available to common stockholders in excess of distributions paid to common stockholders 
 $ 47,868 $ 42,625 $ 91,147 $ 83,754 
 Weighted average number of common shares used for computation per share: 
 
 Basic 
 343,515,406 311,032,972 340,061,487 307,293,949 
 Diluted 
 344,148,378 311,785,281 340,744,384 308,000,806 

 We define FFO, a non-GAAP measure, consistent with the National Association of Real Estate Investment Trusts' definition, as net income available to common stockholders, plus depreciation and amortization of real estate assets, plus impairments of depreciable real estate assets, and reduced by gains on property sales. 
 We consider FFO to be an appropriate supplemental measure of a REIT’s operating performance as it is based on a net income analysis of property portfolio performance that adds back items such as depreciation and impairments for FFO. The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time. Since real estate values historically rise and fall with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less informative. The use of FFO is recommended by the REIT industry as a supplemental performance measure. In addition, FFO is used as a measure of our compliance with the financial covenants of our credit facility. 
 
 ADJUSTED FUNDS FROM OPERATIONS AVAILABLE TO COMMON STOCKHOLDERS (AFFO) 
 The following summarizes our adjusted funds from operations available to common stockholders (dollars in millions, except per share data): 
 
 % Increase 
 Three months ended June 30, Six months ended June 30, Three months Six 
 months 
 
 2020 2019 2020 2019 
 AFFO available to common 
 stockholders 
 $ 295.2 $ 253.9 $ 592.5 $ 502.7 16.3 % 17.9 % 
 AFFO per share (1) 
 $ 0.86 $ 0.82 $ 1.74 $ 1.63 4.9 % 6.7 % 

 (1) All per share amounts are presented on a diluted per common share basis. 
 We consider AFFO to be an appropriate supplemental measure of our performance. Most companies in our industry use a similar measurement, but they may use the term “CAD” (for Cash Available for Distribution), “FAD” (for Funds Available for Distribution) or other terms. 
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 The following is a reconciliation of net income available to common stockholders (which we believe is the most comparable GAAP measure) to FFO and AFFO. Also presented is information regarding distributions paid to common stockholders and the weighted average number of common shares used for the basic and diluted computation per share (dollars in thousands, except per share amounts): 
 
 Three months ended June 30, Six months ended June 30, 
 2020 2019 2020 2019 
 Net income available to common stockholders (1) 
 $ 107,824 $ 95,194 $ 254,651 $ 206,136 
 Cumulative adjustments to calculate FFO (2) 
 180,514 156,295 310,790 291,028 
 FFO available to common stockholders 
 288,338 251,489 565,441 497,164 
 Executive severance charge (3) 
 — — 3,463 — 
 Loss on extinguishment of debt 
 — — 9,819 — 
 Amortization of share-based compensation 
 4,882 4,527 8,624 7,291 
 Amortization of deferred financing costs (4) 
 1,476 1,133 2,836 2,173 
 Amortization of net mortgage premiums 
 (356) (354) (710) (708) 
 Loss on interest rate swaps 
 1,306 686 1,992 1,364 
 Straight-line payments from cross-currency swaps (5) 
 623 799 1,346 799 
 Leasing costs and commissions 
 (973) (707) (1,111) (1,030) 
 Recurring capital expenditures 
 (21) (116) (21) (172) 
 Straight-line rent 
 (6,242) (7,230) (14,024) (12,092) 
 Amortization of above and below-market leases, net 6,087 3,627 12,517 7,741 
 Other adjustments (6) 
 121 81 2,291 139 
 AFFO available to common stockholders 
 $ 295,241 $ 253,935 $ 592,463 $ 502,669 
 AFFO allocable to dilutive noncontrolling interests 
 356 368 732 — 
 Diluted AFFO 
 $ 295,597 $ 254,303 $ 593,195 $ 502,669 
 
 AFFO per common share: 
 Basic $ 0.86 $ 0.82 $ 1.74 $ 1.64 
 Diluted $ 0.86 $ 0.82 $ 1.74 $ 1.63 
 
 Distributions paid to common stockholders 
 $ 240,470 $ 208,864 $ 474,294 $ 413,410 
 
 AFFO available to common stockholders in excess of distributions paid to common stockholders 
 $ 54,771 $ 45,071 $ 118,169 $ 89,259 
 Weighted average number of common shares used for computation per share: 
 
 Basic 
 343,515,406 311,032,972 340,061,487 307,293,949 
 Diluted 
 344,148,378 311,785,281 340,744,384 307,580,127 

 (1) The three and six months ended June 30, 2020 includes $14.1 million of rent deferred as a result of lease concessions we granted in response to the COVID-19 pandemic and recognized under the practical expedient provided by the FASB and $46.1 million of uncollected rent from the second quarter for which we have not granted a lease concession. As of June 30, 2020, we deemed collection of the $60.2 million of unpaid rent included in net income as probable. Deferrals accounted for as modifications totaling $161,000 for the three and six months ended June 30, 2020 have not been added back to AFFO. 
 (2) See reconciling items for FFO presented under “Funds from Operations Available to Common Stockholders (FFO). 
 (3) The executive severance charge represents the incremental costs incurred upon our former CFO's departure in March 2020, consisting of $1.6 million of cash, $1.8 million of share-based compensation expense and $58,000 of professional fees. 
 (4) Includes the amortization of costs incurred and capitalized upon issuance of our notes payable, assumption of our mortgages payable and upon issuance of our term loans. The deferred financing costs are being amortized over the lives of the respective notes payable, mortgages and term loans. No costs associated with our credit facility agreements or annual fees paid to credit rating agencies have been included. 
 (5) Straight-line payments from cross-currency swaps represent quarterly payments in U.S. dollars received by us from counterparties in exchange for associated foreign currency payments. These USD payments are fixed and determinable for the duration of the associated hedging transaction. 
 (6) Includes adjustments allocable to noncontrolling interests, obligations related to financing lease liabilities, and foreign currency gains and losses as a result of intercompany debt and remeasurement transactions. 
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 We believe the non-GAAP financial measure AFFO provides useful information to investors because it is a widely accepted industry measure of the operating performance of real estate companies that is used by industry analysts and investors who look at and compare those companies. In particular, AFFO provides an additional measure to compare the operating performance of different REITs without having to account for differing depreciation assumptions and other unique revenue and expense items which are not pertinent to measuring a particular company’s on-going operating performance. Therefore, we believe that AFFO is an appropriate supplemental performance metric, and that the most appropriate GAAP performance metric to which AFFO should be reconciled is net income available to common stockholders. 
 Presentation of the information regarding FFO and AFFO is intended to assist the reader in comparing the operating performance of different REITs, although it should be noted that not all REITs calculate FFO and AFFO in the same way, so comparisons with other REITs may not be meaningful. Furthermore, FFO and AFFO are not necessarily indicative of cash flow available to fund cash needs and should not be considered as alternatives to net income as an indication of our performance. FFO and AFFO should not be considered as alternatives to reviewing our cash flows from operating, investing, and financing activities. In addition, FFO and AFFO should not be considered as measures of liquidity, our ability to make cash distributions, or our ability to pay interest payments. 
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 PROPERTY PORTFOLIO INFORMATION 
 At June 30, 2020, we owned a diversified portfolio: 
 • Of 6,541 properties; 
 • With an occupancy rate of 98.5%, or 6,440 properties leased and 101 properties available for lease or sale; 
 • Doing business in 50 separate industries; 
 • Located in 49 U.S. states, Puerto Rico and the U.K.; 
 • With approximately 106.4 million square feet of leasable space; 
 • With a weighted average remaining lease term (excluding rights to extend a lease at the option of the tenant) of approximately 9.0 years; and 
 • With an average leasable space per property of approximately 16,270 square feet; approximately 12,000 square feet per retail property and 224,490 square feet per industrial property. 
 At June 30, 2020, 6,440 properties were leased under net lease agreements. A net lease typically requires the tenant to be responsible for monthly rent and certain property operating expenses including property taxes, insurance, and maintenance. In addition, our tenants are typically subject to future rent increases based on increases in the consumer price index (typically subject to ceilings), additional rent calculated as a percentage of the tenants’ gross sales above a specified level, or fixed increases. 
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 Industry Diversification 
 The following table sets forth certain information regarding our property portfolio classified according to the business of the respective tenants, expressed as a percentage of our total rental revenue: 
 
 Percentage of Rental Revenue (excluding reimbursable) by Industry 
 
 For the 
 Quarter Ended 
 June 30, 2020 
 For the Years Ended 
 
 Dec 31, 
 2019 
 Dec 31, 
 2018 
 Dec 31, 
 2017 
 Dec 31, 
 2016 
 Dec 31, 
 2015 
 
 U.S. 
 
 Aerospace 
 0.7% 0.8% 0.8% 0.9% 1.0% 1.1% 
 Apparel stores 
 1.4 1.1 1.3 1.6 1.9 2.0 
 Automotive collision services 
 1.1 1.1 0.9 1.0 1.0 1.0 
 Automotive parts 
 1.7 1.6 1.7 1.3 1.3 1.4 
 Automotive service 
 2.2 2.3 2.2 2.2 1.9 1.9 
 Automotive tire services 
 2.1 2.2 2.4 2.6 2.7 2.9 
 Beverages 
 2.1 2.3 2.5 2.7 2.6 2.7 
 Child care 
 2.2 2.3 1.7 1.8 1.9 2.0 
 Consumer electronics 
 0.3 0.3 0.3 0.3 0.3 0.3 
 Consumer goods 
 0.6 0.6 0.7 0.8 0.9 0.9 
 Convenience stores 
 12.0 11.9 11.2 9.6 8.7 9.2 
 Crafts and novelties 
 0.8 0.6 0.7 0.6 0.6 0.6 
 Diversified industrial 
 0.6 0.7 0.8 0.9 0.9 0.8 
 Dollar stores 
 8.1 7.3 7.5 7.9 8.6 8.9 
 Drug stores 
 9.1 9.0 10.2 10.9 11.2 10.6 
 Education 
 0.2 0.2 0.3 0.3 0.3 0.3 
 Electric utilities 
 0.1 0.1 0.1 0.1 0.1 0.1 
 Entertainment 
 0.3 0.4 0.4 0.4 0.5 0.5 
 Equipment services 
 0.4 0.4 0.4 0.4 0.6 0.5 
 Financial services 
 2.0 2.1 2.3 2.4 1.8 1.7 
 Food processing 
 0.8 0.6 0.5 0.6 1.1 1.2 
 General merchandise 
 3.0 2.5 2.3 2.0 1.8 1.7 
 Government services 
 0.7 0.8 0.9 1.0 1.1 1.2 
 Grocery stores 
 5.0 4.9 5.0 4.4 3.1 3.0 
 Health and beauty 
 0.2 0.3 0.2 * * * 
 Health and fitness 
 7.1 7.5 7.4 7.5 8.1 7.7 
 Health care 
 1.6 1.4 1.5 1.4 1.5 1.7 
 Home furnishings 
 0.8 0.7 0.8 0.9 0.8 0.9 
 Home improvement 
 2.9 3.0 3.0 2.6 2.5 2.4 
 Machinery 
 0.1 0.1 0.1 0.1 0.1 0.1 
 Motor vehicle dealerships 
 1.6 1.9 1.9 2.1 1.9 1.6 
 Office supplies 
 0.2 0.2 0.2 0.2 0.3 0.3 
 Other manufacturing 
 0.6 0.6 0.7 0.8 0.8 0.7 
 Packaging 
 1.0 1.0 1.1 1.0 0.8 0.8 
 Paper 
 0.1 0.1 0.1 0.1 0.1 0.1 
 Pet supplies and services 
 0.8 0.5 0.5 0.6 0.6 0.7 
 Restaurants - casual dining 
 3.0 3.2 3.2 3.8 3.9 3.8 
 Restaurants - quick service 
 4.8 6.2 5.7 5.1 4.9 4.2 
 Shoe stores 
 0.2 0.3 0.5 0.6 0.7 0.7 
 Sporting goods 
 0.8 0.9 1.1 1.4 1.6 1.8 
 Telecommunications 
 0.5 0.5 0.6 0.6 0.6 0.7 
 Theaters 
 6.3 6.3 5.5 5.0 4.9 5.1 
 Transportation services 
 4.2 4.6 5.0 5.4 5.5 5.4 
 Wholesale clubs 
 2.5 2.7 3.0 3.3 3.6 3.8 
 Other 
 0.1 0.6 0.8 0.8 0.9 1.0 
 Total U.S. 
 96.9% 98.7% 100.0% 100.0% 100.0% 100.0% 
 U.K. 
 
 Grocery stores 
 3.0 1.3 — — — — 
 Health care 
 0.1 — — — — — 
 Theaters 
 * * — — — — 
 Total U.K. 
 3.1% 1.3% — — — — 
 Totals 
 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 

 * Less than 0.1% 
 -51- 

 Table of Contents 

 Property Type Composition 
 The following table sets forth certain property type information regarding our property portfolio as of June 30, 2020 (dollars in thousands): 
 
 Property Type 
 Number of 
 Properties 
 Approximate 
 Leasable 
 Square Feet (1) 
 Rental Revenue for the 
 Quarter Ended 
 June 30, 2020 (2) 
 Percentage of 
 Rental Revenue 
 
 Retail 
 6,364 76,343,300 $ 326,516 83.9 % 
 Industrial 
 119 26,714,300 42,344 10.9 
 Office 
 43 3,175,700 13,660 3.5 
 Agriculture 
 15 184,500 6,716 1.7 
 Totals 
 6,541 106,417,800 $ 389,236 100.0 % 

 (1) Includes leasable building square footage. Excludes 3,300 acres of leased land categorized as agriculture at June 30, 2020. 
 (2) Includes rental revenue for all properties owned at June 30, 2020. Excludes revenue of $1 from sold properties and rental revenue (reimbursable) of $20,964. 
 Tenant Diversification 
 The following table sets forth the 20 largest tenants in our property portfolio, expressed as a percentage of total portfolio annualized contractual rental revenue, which does not give effect to deferred rent, at June 30, 2020: 
 
 Tenant 
 Number of 
 Leases 
 % of Rental 
 Revenue (1) 
 
 Walgreens 248 6.0 % 
 7-Eleven 403 4.7 % 
 Dollar General 771 4.5 % 
 FedEx 41 3.9 % 
 Dollar Tree / Family Dollar 550 3.4 % 
 LA Fitness 57 3.4 % 
 Regal Cinemas (Cineworld) 42 2.9 % 
 AMC Theaters 32 2.7 % 
 Walmart / Sam's Club 54 2.5 % 
 Sainsbury's 16 2.5 % 
 Lifetime Fitness 16 2.4 % 
 Circle K (Couche-Tard) 280 1.9 % 
 BJ's Wholesale Clubs 15 1.8 % 
 CVS Pharmacy 88 1.6 % 
 Treasury Wine Estates 17 1.6 % 
 Super America (Marathon) 161 1.6 % 
 Kroger 22 1.5 % 
 GPM Investments / Fas Mart 207 1.4 % 
 TBC Corp 159 1.2 % 
 Home Depot 19 1.2 % 
 Total 3,198 52.8 % 

 (1) Excludes rental revenue (reimbursable). Amounts for each tenant are calculated independently; therefore, the individual percentages may not sum to the total. 
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 Table of Contents 

 Lease Expirations 
 The following table sets forth certain information regarding the timing of the lease term expirations in our portfolio (excluding rights to extend a lease at the option of the tenant) and their contribution to rental revenue for the quarter ended June 30, 2020 (dollars in thousands): 
 
 Total Portfolio (1) 
 
 Expiring 
 Leases 
 Approximate 
 Leasable 
 Square Feet 
 Rental Revenue for
the Quarter Ended
June 30, 2020 % of 
 Rental 
 Revenue 
 
 Year 
 Retail 
 Non-Retail 
 
 2020 66 8 1,433,500 $ 3,824 1.0 % 
 2021 357 14 3,280,200 12,381 3.2 
 2022 412 22 8,899,800 20,176 5.2 
 2023 549 23 10,227,100 30,864 8.0 
 2024 411 16 7,076,900 22,793 5.9 
 2025 475 19 7,932,400 28,146 7.3 
 2026 328 4 5,185,200 17,853 4.6 
 2027 564 6 7,310,600 23,785 6.1 
 2028 442 14 10,394,400 27,513 7.1 
 2029 533 6 9,088,100 29,230 7.5 
 2030 258 14 5,003,500 23,384 6.0 
 2031 315 26 6,844,700 29,223 7.5 
 2032 135 4 3,799,400 15,155 3.9 
 2033 283 3 3,682,900 18,661 4.8 
 2034 322 1 4,548,400 28,012 7.2 
 2035 - 2045 890 5 9,596,600 57,219 14.7 
 Totals 
 6,340 185 104,303,700 $ 388,219 100.0 % 

 (1) The lease expirations for leases under construction are based on the estimated date of completion of those projects. Excludes revenue of $1,017 from expired leases, $1 from sold properties, and $20,964 of rental revenue (reimbursable) at June 30, 2020. Leases on our multi-tenant properties are counted separately in the table above. 
 -53- 

 Table of Contents 

 Geographic Diversification 
 The following table sets forth certain state-by-state information regarding our property portfolio as of June 30, 2020 (dollars in thousands): 
 
 Location 
 Number of 
 Properties 
 Percent Leased 
 Approximate 
 Leasable 
 Square Feet 
 Rental Revenue 
 for the Quarter 
 Ended 
 June 30, 2020 (1) 
 Percentage of 
 Rental 
 Revenue 
 
 Alabama 
 227 98 % 2,148,400 $ 7,796 2.0 % 
 Alaska 
 3 100 274,600 536 0.1 
 Arizona 
 153 99 2,085,300 8,825 2.3 
 Arkansas 
 102 99 1,183,200 3,472 0.9 
 California 
 231 99 6,643,800 34,210 8.8 
 Colorado 
 100 96 1,582,900 5,943 1.5 
 Connecticut 
 21 90 1,378,200 4,088 1.0 
 Delaware 
 19 100 101,400 690 0.2 
 Florida 
 432 98 4,697,800 20,648 5.3 
 Georgia 
 300 98 4,612,100 14,476 3.7 
 Idaho 
 14 93 103,200 441 0.1 
 Illinois 
 296 98 6,396,500 22,230 5.7 
 Indiana 
 204 99 2,565,600 10,499 2.7 
 Iowa 
 45 100 2,443,200 4,414 1.1 
 Kansas 
 122 96 2,256,800 6,251 1.6 
 Kentucky 
 93 100 1,826,100 5,358 1.4 
 Louisiana 
 137 96 1,905,500 6,177 1.6 
 Maine 
 27 100 277,800 1,473 0.4 
 Maryland 
 38 100 1,494,000 6,449 1.7 
 Massachusetts 
 59 95 942,800 4,529 1.2 
 Michigan 
 223 100 2,610,800 9,322 2.4 
 Minnesota 
 172 99 2,326,800 11,108 2.9 
 Mississippi 
 187 98 2,021,800 5,657 1.5 
 Missouri 
 187 96 3,019,600 9,493 2.4 
 Montana 
 12 100 89,100 536 0.1 
 Nebraska 
 62 97 866,400 2,274 0.6 
 Nevada 
 24 96 1,196,900 2,153 0.5 
 New Hampshire 
 14 100 321,500 1,464 0.4 
 New Jersey 
 79 99 1,252,000 7,622 2.0 
 New Mexico 
 60 100 504,200 2,002 0.5 
 New York 
 139 98 3,028,600 16,532 4.2 
 North Carolina 
 202 99 3,334,500 11,236 2.9 
 North Dakota 
 8 100 126,900 336 0.1 
 Ohio 
 342 98 6,731,800 17,311 4.4 
 Oklahoma 
 191 98 2,377,600 8,145 2.1 
 Oregon 
 30 100 644,600 2,278 0.6 
 Pennsylvania 
 223 100 2,265,900 9,127 2.3 
 Rhode Island 
 3 100 158,000 815 0.2 
 South Carolina 
 179 97 1,811,000 8,408 2.2 
 South Dakota 
 23 96 258,500 683 0.2 
 Tennessee 
 260 99 3,850,400 11,892 3.1 
 Texas 
 804 99 11,630,800 41,467 10.7 
 Utah 
 23 100 949,700 2,339 0.6 
 Vermont 
 1 100 65,500 191 * 
 Virginia 
 219 99 3,357,000 10,994 2.8 
 Washington 
 50 98 913,400 3,726 1.0 
 West Virginia 
 36 100 528,100 1,854 0.5 
 Wisconsin 
 128 98 3,106,200 9,003 2.3 
 Wyoming 
 9 100 63,900 379 0.1 
 Puerto Rico 
 4 100 28,300 150 * 
 U.K. 
 24 100 2,058,800 12,234 3.1 
 Totals\Average 
 6,541 98 % 106,417,800 $ 389,236 100.0 % 

 * Less than 0.1% 
 (1) Includes rental revenue for all properties owned at June 30, 2020. Excludes revenue of $1 from sold properties and $20,964 of tenant reimbursement revenue. 
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 Table of Contents 

 IMPACT OF INFLATION 
 Tenant leases generally provide for limited increases in rent as a result of increases in the tenants’ sales volumes, increases in the consumer price index (typically subject to ceilings), or fixed increases. We expect that inflation will cause these lease provisions to result in rent increases over time. During times when inflation is greater than increases in rent, as provided for in the leases, rent increases may not keep up with the rate of inflation. 
 Moreover, our use of net lease agreements tends to reduce our exposure to rising property expenses due to inflation because the tenant is responsible for property expenses. Inflation and increased costs may have an adverse impact on our tenants if increases in their operating expenses exceed increases in revenue. 
 
 IMPACT OF RECENT ACCOUNTING PRONOUNCEMENTS 
 For the period ended June 30, 2020 there were no recently adopted accounting pronouncements that had a material impact on our business. 
 
 OTHER INFORMATION 
 Our common stock is listed on the NYSE under the ticker symbol “O” with a CUSIP number of 756109-104. Our central index key number is 726728. 
 We maintain a corporate website at www.realtyincome.com. On our website we make available, free of charge, copies of our annual report on Form 10-K, quarterly reports on Form 10-Q, Form 3s, Form 4s, Form 5s, current reports on Form 8-K, and amendments to those reports, as soon as reasonably practicable after we electronically file these reports with the Securities and Exchange Commission, or SEC. None of the information on our website is deemed to be part of this report.
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.
REALTY INCOME CORP 10-Q

Item 2. Management’s Discussion and Analysis
