This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Realty Income's CEO Discusses Acquisition Of American Realty Capital Trust Conference (Transcript)

Stocks in this article: O

And in this transaction, approximately 75% of the rental revenue of the 501 properties, we’ll be acquiring here will be with investment grade tenants, that includes FedEx, Walgreens, CVS, the GSA, Dollar General, Express Scripts, PNC Bank and really a number of other retail and commercial tenants with investment grade.

It will also in one fell swoop make FedEx become our single largest tenant, yet given the size of the two organization being put together, only about 6% of revenue. And overall, the revenue generated by investment grade tenants in our portfolio increase from about 19% today to 34% of the revenue. So it is extremely additive to this very important initiative for us.

The second initiative we’ve been pursuing is, most people who follow us know, is to add to our revenue generated by commercial tenants operating in industries other than retail and this transaction moves that from about 13% of our revenue generated outside to about 20% with the vast majority of all of that revenue coming from investment grade tenants.

Above and beyond the strategic initiative and just looking at the portfolio, this continues to improve the quality of the rental revenue of our portfolio through a substantial additional diversification. If you take a glance on page seven of the slides, you’ll see that the top 15 tenants, which we report each quarter, the revenue from those tenants’ declines from about 49% of revenue to 42% of revenue. So there’s a meaningful difference there.

And if you look at the top few now in descending order, FedEx, as I mentioned, would be our largest tenant at about 6%. It would drop then to AMC Theaters at 3.8%; LA Fitness at 3.7%; Diageo, the large international drinks company at 3.6%; then Walgreens to 3.2% and Super America at 3.1%.

4 of 5

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs