# NNN REIT, INC. (NNN)

Informational only - not investment advice.

CIK: 0000751364
SIC: 6798 Real Estate Investment Trusts
SIC breadcrumb: [Finance, Insurance, And Real Estate](/division/H/) > [Holding And Other Investment Offices](/major-group/67/) > [SIC 6798 Real Estate Investment Trusts](/industry/6798/)
Latest 10-K filed: 2026-02-11
SEC page: https://www.sec.gov/edgar/browse/?CIK=751364
Filing source: https://www.sec.gov/Archives/edgar/data/751364/000119312526045617/nnn-20251231.htm

## At a glance

FY2025 · period end 2025-12-31 · filed 2026-02-11 · accession 0001193125-26-045617 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000751364.json

| Metric | Value | FY | Provenance |
| --- | ---: | ---: | --- |
| Revenue | 926,213,000 USD | 2025 | verified |
| Net income | 389,777,000 USD | 2025 | verified |
| Assets | 9,379,355,000 USD | 2025 | verified |
| Net margin | 42.08% | 2025 | computed |
| Operating margin | 63.64% | 2025 | computed |
| Revenue YoY | +6.55% | 2025 | computed |
| ROE | 8.84% | 2025 | computed |

Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Net margin = net income ÷ revenue. Operating margin = operating income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity.

No market price, no rating, no forecast on this site. Not investment advice.

### Peer percentile fingerprint

| Ratio | NNN | Peer median | Percentile | N |
| --- | ---: | ---: | ---: | ---: |
| Net margin | 42.1% | 16.8% | 86 | 149 |
| Operating margin | 63.6% | 23.2% | 85 | 66 |
| Revenue growth | 6.6% | 3.7% | 64 | 149 |
| ROE | 8.8% | 5.7% | 69 | 151 |
| ROA | 4.2% | 1.5% | 79 | 155 |
| Liabilities / equity | 1.13 | 1.48 | 38 | 151 |

Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 6798 Real Estate Investment Trusts, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking.

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 926213000 | USD | 2025 | 2026-02-11 |
| Net income | 389777000 | USD | 2025 | 2026-02-11 |
| Assets | 9379355000 | USD | 2025 | 2026-02-11 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-11. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000751364.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue | 533,647,000 | 584,933,000 | 622,661,000 | 670,487,000 | 660,681,000 | 726,407,000 | 773,053,000 | 828,111,000 | 869,266,000 | 926,213,000 |
| Net income | 239,500,000 | 264,973,000 | 292,447,000 | 299,180,000 | 228,799,000 | 290,113,000 | 334,626,000 | 392,340,000 | 396,835,000 | 389,777,000 |
| Operating income | 336,251,000 | 374,158,000 | 424,762,000 | 416,519,000 | 374,489,000 | 449,096,000 | 482,537,000 | 555,104,000 | 577,872,000 | 589,486,000 |
| Diluted EPS | 1.38 | 1.45 | 1.65 | 1.56 | 1.22 | 1.51 | 1.89 | 2.16 | 2.15 | 2.07 |
| Operating cash flow | 415,337,000 | 421,557,000 | 471,909,000 | 501,727,000 | 450,194,000 | 568,425,000 | 578,355,000 | 612,410,000 | 635,504,000 | 667,131,000 |
| Dividends paid | 257,007,000 | 277,120,000 | 303,164,000 | 333,692,000 | 356,409,000 | 367,291,000 | 380,538,000 | 404,458,000 | 420,239,000 | 443,202,000 |
| Assets | 6,334,151,000 | 6,560,534,000 | 7,103,438,000 | 7,434,867,000 | 7,637,844,000 | 7,751,054,000 | 8,146,045,000 | 8,661,968,000 | 8,872,728,000 | 9,379,355,000 |
| Liabilities | 2,417,223,000 | 2,719,624,000 | 2,948,833,000 | 3,103,185,000 | 3,318,540,000 | 3,849,391,000 | 4,022,543,000 | 4,504,511,000 | 4,510,453,000 | 4,971,053,000 |
| Stockholders' equity | 3,916,799,000 | 3,840,593,000 | 4,154,250,000 | 4,331,675,000 | 4,319,300,000 | 3,901,662,000 | 4,123,502,000 | 4,157,457,000 | 4,362,275,000 | 4,408,302,000 |
| Cash and cash equivalents | 294,540,000 | 1,364,000 | 114,267,000 | 1,112,000 | 267,236,000 | 171,322,000 | 2,505,000 | 1,189,000 | 8,731,000 | 5,046,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin | 44.88% | 45.30% | 46.97% | 44.62% | 34.63% | 39.94% | 43.29% | 47.38% | 45.65% | 42.08% |
| Operating margin | 63.01% | 63.97% | 68.22% | 62.12% | 56.68% | 61.82% | 62.42% | 67.03% | 66.48% | 63.64% |
| Return on equity | 6.11% | 6.90% | 7.04% | 6.91% | 5.30% | 7.44% | 8.12% | 9.44% | 9.10% | 8.84% |
| Return on assets | 3.78% | 4.04% | 4.12% | 4.02% | 3.00% | 3.74% | 4.11% | 4.53% | 4.47% | 4.16% |
| Liabilities / equity | 0.62 | 0.71 | 0.71 | 0.72 | 0.77 | 0.99 | 0.98 | 1.08 | 1.03 | 1.13 |

## As-reported value updates

2 tracked differences above grepcent's stated thresholds were found between the earliest XBRL-filed value and the value currently on file for the same fiscal period.

Ledger: /company/NNN/revisions/


## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-08-05. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000751364.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q2 | 2022-06-30 |  |  | 0.42 | reported discrete quarter |
| 2022-Q3 | 2022-09-30 |  |  | 0.50 | reported discrete quarter |
| 2023-Q1 | 2023-03-31 |  |  | 0.50 | reported discrete quarter |
| 2023-Q2 | 2023-06-30 | 202,640,000 | 98,704,000 | 0.54 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 205,132,000 | 106,787,000 | 0.59 | reported discrete quarter |
| 2023-Q4 | 2023-12-31 | 216,231,000 | 96,682,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-31 | 215,407,000 | 94,371,000 | 0.52 | reported discrete quarter |
| 2024-Q2 | 2024-06-30 | 216,813,000 | 106,666,000 | 0.58 | reported discrete quarter |
| 2024-Q3 | 2024-09-30 | 218,564,000 | 97,904,000 | 0.53 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 218,482,000 | 97,894,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-31 | 230,854,000 | 96,458,000 | 0.51 | reported discrete quarter |
| 2025-Q2 | 2025-06-30 | 226,802,000 | 100,529,000 | 0.54 | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 230,159,000 | 96,839,000 | 0.51 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 238,398,000 | 95,951,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q2 | 2026-06-30 | 244,266,000 | 97,924,000 | 0.52 | reported discrete quarter |

## Filed narrative (10-K & 10-Q)

## Business

Verbatim Item 1 Business section from NNN's latest 10-K: [/company/NNN/business/](/company/NNN/business/).

## Risk Factors

Verbatim Item 1A Risk Factors from NNN's latest 10-K: [/company/NNN/risk-factors/](/company/NNN/risk-factors/).

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/751364/000119312526333967/nnn-20260630.htm

Extracted from a substantive MD&A body after the formal Item 2 span was a TOC or reference stub.
Confidence: high
Filing date: 2026-08-05
Report date: 2026-06-30

Overview

NNN, a Maryland corporation, is a fully integrated REIT formed in 1984. NNN acquires, owns, invests in and develops high-quality properties that are leased primarily to tenants under long-term, net leases, with minimal ongoing capital expenditures and are primarily held for investment ("Properties" or "Property Portfolio" or individually a "Property").

As of June 30, 2026, NNN owned 3,774 Properties in all 50 states, the District of Columbia and Puerto Rico, with an aggregate gross leasable area of approximately 40,440,000 square feet and a weighted average remaining lease term of 10.1 years. As of June 30, 2026, 99.1 percent of the Properties were leased.

NNN's management team focuses on certain key indicators to evaluate the financial condition and operating performance of NNN. Key indicators include items such as: the composition of the Property Portfolio (such as tenant, line of trade and geographic diversification), the occupancy rate of the Property Portfolio, certain financial performance metrics and profitability measures, industry trends and industry performance compared to that of NNN.

23

NNN evaluates the creditworthiness of its significant current and prospective tenants. This evaluation may include reviewing available financial statements, store level financial performance, press releases, public credit ratings from major credit rating agencies, industry news publications and financial market data (debt and equity pricing). NNN may also evaluate the business and operations of its significant tenants, including past payment history and periodically meeting with senior management of certain tenants.

NNN continues to maintain its diversification by tenant, line of trade and geography. NNN's top line of trade concentrations are the automotive service (18.6%), convenience stores (15.9%) and restaurants (including full and limited service) (14.0%) sectors. NNN's management believes these sectors present attractive investment opportunities. The Property Portfolio is geographically concentrated in regions of historically above-average population growth, including the southeastern (25.4%) and southern (24.2%) United States. Given these concentrations, any financial hardship within these sectors or geographic regions could have a material adverse effect on the financial condition and operating performance of NNN.

Additional information related to NNN and the Property Portfolio is included in NNN's 2025 Annual Report.

Results of Operations

Property Analysis

General. The following table summarizes the Property Portfolio:

[[GREPCENT_TABLE]]
[["","","June 30, 2026","","","December 31, 2025","","","June 30, 2025"],["Properties Owned:"],["Number","","","3,774","","","","3,692","","","","3,663"],["Total gross leasable area (square feet)","","","40,440,000","","","","39,578,000","","","","38,322,000"],["States(1)","","","50","","","","50","","","","50"],["Properties:"],["Leased and unimproved land","","","3,739","","","","3,628","","","","3,590"],["Percent of Properties \u2013 leased and unimproved land","","","99.1","%","","","98.3","%","","","98.0","%"],["Weighted average remaining lease term (years)","","","10.1","","","","10.2","","","","9.8"],["Total gross leasable area (square feet) \u2013 leased","","","40,080,000","","","","38,955,000","","","","37,476,000"],["Total Annualized Base Rent (\"ABR\")(2)","","$","959,145,000","","","$","928,081,000","","","$","893,782,000"]]
[[/GREPCENT_TABLE]]

[[GREPCENT_TABLE]]
[["(1)","Plus the District of Columbia and Puerto Rico."],["(2)","ABR represents the monthly cash base rent for all leases in place as of the end of the period multiplied by 12."]]
[[/GREPCENT_TABLE]]

24

The following table summarizes the diversification of the Property Portfolio for the top 20 lines of trade as a percentage of ABR:

[[GREPCENT_TABLE]]
[["","","Lines of Trade","","June 30, 2026","","December 31, 2025","","June 30, 2025"],["1.","","Automotive service","","18.6%","","18.6%","","18.2%"],["2.","","Convenience stores","","15.9%","","16.3%","","16.5%"],["3.","","Restaurants \u2013 limited service","","7.7%","","7.9%","","8.2%"],["4.","","Entertainment","","7.3%","","7.2%","","7.3%"],["5.","","Dealerships","","6.4%","","6.6%","","6.7%"],["6.","","Restaurants \u2013 full service","","6.3%","","6.4%","","7.0%"],["7.","","Health and fitness","","3.8%","","3.9%","","4.1%"],["8.","","Theaters","","3.5%","","3.7%","","3.8%"],["9.","","Automotive parts","","3.2%","","3.2%","","2.4%"],["10.","","Equipment rental","","3.0%","","3.1%","","3.1%"],["11.","","Wholesale clubs","","2.2%","","2.3%","","2.3%"],["12.","","Early childhood education","","2.2%","","1.4%","","1.1%"],["13.","","Drug stores","","1.9%","","2.0%","","2.1%"],["14.","","Home improvement","","1.9%","","1.9%","","2.0%"],["15.","","Discount retail","","1.9%","","1.4%","","1.4%"],["16.","","Medical service providers","","1.7%","","1.8%","","1.9%"],["17.","","Pet supplies and services","","1.7%","","1.7%","","1.6%"],["18.","","Furniture","","1.2%","","1.2%","","1.3%"],["19.","","Travel plazas","","1.1%","","1.2%","","1.2%"],["20.","","Automobile auctions, wholesale","","1.1%","","1.1%","","1.0%"],["","","Other","","7.4%","","7.1%","","6.8%"],["","","","","100.0%","","100.0%","","100.0%"]]
[[/GREPCENT_TABLE]]

Property Acquisitions. The following table summarizes the Property acquisitions (dollars in thousands):

[[GREPCENT_TABLE]]
[["","","Quarter Ended June 30,","","","Six Months Ended June 30,"],["","","2026","","","2025","","","2026","","","2025"],["Acquisitions:"],["Number of Properties","","","89","","","","45","","","","130","","","","127"],["Gross leasable area (square feet)(1)","","","1,061,000","","","","1,399,000","","","","1,365,000","","","","2,230,000"],["Weighted average cap rate(2)","","","7.3","%","","","7.4","%","","","7.4","%","","","7.4","%"],["Total dollars invested(3)","","$","291,009","","","$","232,536","","","$","436,403","","","$","464,929"]]
[[/GREPCENT_TABLE]]

[[GREPCENT_TABLE]]
[["(1)","Includes additional square footage from completed construction on existing Properties."],["(2)","Calculated as the initial cash annual base rent divided by the total purchase price of the Properties."],["(3)","Includes dollars invested in projects under construction or tenant improvements for each respective period."]]
[[/GREPCENT_TABLE]]

NNN typically funds Property acquisitions either through borrowings under NNN's Credit Facility (as defined in "Capital Structure – Line of Credit Payable"), by issuing its debt or equity securities in the capital markets, with undistributed funds from operations or with proceeds from the sale of Properties.

25

Property Dispositions. The following table summarizes the properties sold by NNN (dollars in thousands):

[[GREPCENT_TABLE]]
[["","","Quarter Ended June 30,","","","Six Months Ended June 30,"],["","","2026","","","2025","","","2026","","","2025"],["Number of properties(1)","","","26","","","","23","","","","51","","","","33"],["Gross leasable area (square feet)","","","195,000","","","","358,000","","","","441,000","","","","430,000"],["Net sales proceeds","","$","36,734","","","$","51,248","","","$","72,561","","","$","67,087"],["Net gain on disposition of real estate","","$","9,105","","","$","16,198","","","$","21,290","","","$","20,011"],["Weighted average cap rate(2)","","","5.6","%","","","6.2","%","","","6.6","%","","","5.7","%"]]
[[/GREPCENT_TABLE]]

[[GREPCENT_TABLE]]
[["(1)","Sold 35 vacant and 16 income producing properties during the six months ended June 30, 2026 compared to 14 vacant and 19 income producing properties sold during the six months ended June 30, 2025."],["(2)","Calculated as the cash annual base rent divided by the total gross proceeds received for the occupied properties."]]
[[/GREPCENT_TABLE]]

NNN typically uses the disposition proceeds to either pay down the Credit Facility or reinvest in real estate.

Analysis of Revenues

The following table summarizes NNN's revenues (dollars in thousands):

[[GREPCENT_TABLE]]
[["","","Quarter Ended June 30,","","","","","","Six Months Ended June 30,"],["","","2026","","","2025","","","Change","","","2026","","","2025","","","Change"],["Rental Revenues(1)","","$","237,827","","","$","222,110","","","$","15,717","","","$","471,796","","","$","447,166","","","$","24,630"],["Real estate expenses reimbursed from tenants(2)","","","4,855","","","","4,388","","","","467","","","","10,900","","","","9,906","","","","994"],["Rental income","","","242,682","","","","226,498","","","","16,184","","","","482,696","","","","457,072","","","","25,624"],["Interest and other income from real estate transactions","","","1,584","","","","304","","","","1,280","","","","1,994","","","","584","","","","1,410"],["Total revenues","","$","244,266","","","$","226,802","","","$","17,464","","","$","484,690","","","$","457,656","","","$","27,034"]]
[[/GREPCENT_TABLE]]

[[GREPCENT_TABLE]]
[["(1)","Includes rental income from operating leases, earned income from direct financing leases and percentage rent (\"Rental Revenues\")."],["(2)","See \"Results of Operations \u2013 Analysis of Expenses \u2013 Real Estate\" for additional information."]]
[[/GREPCENT_TABLE]]

Rental Income. Rental income increased for the quarter and six months ended June 30, 2026, compared to the same periods in 2025. The increase is primarily due to the Rental Revenues from NNN's recent Property acquisitions (see "Results of Operations – Property Analysis – Property Acquisitions").

26

Analysis of Expenses

The following table summarizes NNN's expenses (dollars in thousands):

[[GREPCENT_TABLE]]
[["","","Quarter Ended June 30,","","","","","","Six Months Ended June 30,"],["","","2026","","","2025","","","Change","","","2026","","","2025","","","Change"],["General and administrative","","$","14,057","","","$","11,217","","","$","2,840","","","$","28,163","","","$","24,225","","","$","3,938"],["Real estate:"],["Reimbursed from tenants","","","4,855","","","","4,388","","","","467","","","","10,900","","","","9,906","","","","994"],["Non-reimbursed","","","3,411","","","","4,450","","","","(1,039",")","","","7,165","","","","8,307","","","","(1,142",")"],["Total real estate","","","8,266","","","","8,838","","","","(572",")","","","18,065","","","","18,213","","","","(148",")"],["Depreciation and amortization","","","71,025","","","","68,349","","","","2,676","","","","141,822","","","","132,966","","","","8,856"],["Leasing transaction costs","","","212","","","","74","","","","138","","","","356","","","","204","","","","152"],["Impairment losses \u2013 real estate, net of recoveries","","","8,067","","","","4,535","","","","3,532","","","","18,747","","","","6,047","","","","12,700"],["Retirement and severance costs","","","368","","","","191","","","","177","","","","802","","","","2,364","","","","(1,562",")"],["Total operating expenses","","$","101,995","","","$","93,204","","","$","8,791","","","$","207,955","","","$","184,019","","","$","23,936"],["Interest and other income","","$","(35",")","","$","(15",")","","$","(20",")","","$","(63",")","","$","(344",")","","$","281"],["Interest expense","","","53,487","","","","49,282","","","","4,205","","","","106,213","","","","97,005","","","","9,208"],["Total other expenses","","$","53,452","","","$","49,267","","","$","4,185","","","$","106,150","","","$","96,661","","","$","9,489"]]
[[/GREPCENT_TABLE]]

[[GREPCENT_TABLE]]
[["As a percentage of total revenues:"],["General and administrative","","","5.8","%","","","4.9","%","","","","","5.8","%","","","5.3","%"],["Non-reimbursed real estate","","","1.4","%","","","2.0","%","","","","","1.5","%","","","1.8","%"]]
[[/GREPCENT_TABLE]]

General and Administrative. General and administrative expenses increased in amount and as a percentage of total revenues for the quarter and six months ended June 30, 2026, as compared to the same periods in 2025. The increase was primarily attributable to an increase in compensatio

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A (excerpt)

Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/751364/000119312526045617/nnn-20251231.htm
Complete FY 2025 MD&A: /company/NNN/mda/fy2025/

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high
Filing date: 2026-02-11
Report date: 2025-12-31

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

This section generally discusses 2025 and 2024 and year-to-year comparisons. Discussions of 2024 and 2023 year-to-year comparisons that are not included in this annual report on Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission ("Commission" or "SEC") on February 11, 2025.

The term "NNN" or the "Company" refers to NNN REIT, Inc. and its consolidated subsidiaries. NNN may elect to treat certain of its subsidiaries as taxable real estate investment trust subsidiaries.

Forward-Looking Statements

The following discussion and analysis should be read in conjunction with the consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. NNN makes statements in this section that are forward-looking statements within the meaning of the federal securities laws. For a complete discussion of forward-looking statements, see the section in this report entitled "Forward-Looking Statements." Certain risks may cause NNN's actual results, performance or achievements to differ materially from those expressed or implied by the following discussion. For a discussion of such risk factors, see "Item 1A. Risk Factors."

Overview

NNN, a Maryland corporation, is a fully integrated real estate investment trust ("REIT") formed in 1984. NNN acquires, owns, invests in and develops high-quality properties that are leased primarily to tenants under long-term, net leases, with minimal ongoing capital expenditures and are primarily held for investment ("Properties" or "Property Portfolio" or individually a "Property").

As of December 31, 2025, NNN owned 3,692 Properties in all 50 states, the District of Columbia and Puerto Rico, with an aggregate gross leasable area of approximately 39,578,000 square feet and a weighted average remaining lease term of 10.2 years. As of December 31, 2025, 98.3 percent of the Properties were leased.

NNN's management team focuses on certain key indicators to evaluate the financial condition and operating performance of NNN. Key indicators include items such as: the composition of the Property Portfolio (such as tenant, line of trade and geographic diversification), the occupancy rate of the Property Portfolio, certain financial performance metrics and profitability measures, industry trends and industry performance compared to that of NNN.

NNN evaluates the creditworthiness of its significant current and prospective tenants. This evaluation may include reviewing available financial statements, store level financial performance, press releases, public credit ratings from major credit rating agencies, industry news publications and financial market data (debt and equity pricing). NNN may also evaluate the business and operations of its significant tenants, including past payment history and periodically meeting with senior management of certain tenants.

NNN continues to maintain its diversification by tenant, line of trade and geography. NNN's top line of trade concentrations are the automotive service (18.6%), convenience stores (16.3%), restaurants (including full and limited service) (14.3%), entertainment (7.2%) and dealerships (6.6%) sectors. NNN's management believes these sectors present attractive investment opportunities. The Property Portfolio is geographically concentrated in regions of historically above-average population growth, including the southeastern (25.3%) and southern (24.6%) United States ("U.S."). Given these concentrations, any financial hardship within these sectors or geographic regions could have a material adverse effect on the financial condition and operating performance of NNN.

25

As of December 31, 2025 and 2024, the Property Portfolio remained at least 98 percent leased and had a weighted average remaining lease term of approximately 10 years. High occupancy levels coupled with a triple-net lease structure provide enhanced probability of achieving consistent operating results.

Critical Accounting Estimates

The preparation of NNN's consolidated financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses as well as other disclosures in the financial statements. Estimates are sensitive to evaluations by management about current and future expectations of market and economic conditions. On an ongoing basis, management evaluates its estimates and assumptions; however, actual results may differ from these estimates and assumptions, which in turn could have a material impact on NNN's consolidated financial statements. A summary of NNN's accounting policies and procedures is included in Note 1 of the December 31, 2025 Consolidated Financial Statements. Management believes the following critical accounting policies, among others, affect its more significant estimates and assumptions used in the preparation of NNN's consolidated financial statements.

Real Estate Portfolio. NNN records the acquisition of real estate at cost, including acquisition and closing costs. The cost of Properties developed or funded by NNN includes direct and indirect costs of construction, property taxes, interest, third-party costs and other miscellaneous costs incurred during the development period until the project is substantially completed and available for occupancy.

Purchase Accounting for Acquisition of Real Estate. In accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 805, Business Combinations, consideration for the real estate acquired is allocated to the acquired tangible assets, consisting of land, building and tenant improvements and, if applicable, to identified intangible assets and liabilities, consisting of the value of above-market and below-market in-place leases and the value of in-place leases, as applicable, based on their respective fair values.

The fair value estimate is sensitive to significant assumptions, such as establishing a range of relevant market assumptions for land, building and rent and where the acquired property falls within that range. These market assumptions for land, building and rent use the most relevant comparable properties for an acquisition. The final value relies upon ranking comparable properties' attributes from most to least similar.

Lease Accounting. NNN records its leases on the Property Portfolio in accordance with FASB ASC Topic 842, Leases ("ASC 842"). NNN's real estate is predominantly leased to tenants under triple-net leases, whereby the tenant is responsible for all operating expenses relating to the Property, including utilities, real estate taxes and assessments, property and liability insurance, maintenance, repairs and capital expenditures.

Substantially all of NNN's Property Portfolio consists of leases accounted for using the operating method. Under the operating method, revenue is recognized as rentals are earned and expenses (including depreciation) are charged to operations as incurred. When scheduled rentals vary during the lease term, income is recognized on a straight-line basis so as to produce a constant periodic rent over the term of the lease. Accrued rental income is the aggregate difference between the scheduled rents which vary during the lease term and the income recognized on a straight-line basis.

Collectability. In accordance with ASC 842, NNN reviews the collectability of its lease payments on an ongoing basis. NNN considers collectability indicators when analyzing accounts receivable (and accrued rent), historical bad debt levels, tenant credit-worthiness and current economic trends, all of which assist in evaluating the probability of outstanding and future rental income collections and the adequacy of the allowance for doubtful accounts. In addition, tenants in bankruptcy are analyzed and considerations are made in connection with the expected recovery of pre-petition and post-petition bankruptcy claims.

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When NNN deems the collection of rental income from a tenant not probable, uncollected previously recognized rental revenue and any related accrued rent are reversed as a reduction to rental income and, subsequently, rental income is only recognized when cash receipts are received. At this point, a tenant is deemed cash basis for accounting purposes. If NNN subsequently deems the collection of rental income is probable, any related accrued rental income or expense is restored.

NNN includes an allowance for doubtful accounts in rental income on the Consolidated Statements of Income and Comprehensive Income.

Real Estate – Held For Sale. Real estate held for sale is not depreciated and is recorded at the lower of cost or fair value, less cost to sell. On a quarterly basis, the Company evaluates its Properties for held for sale classification based on specific criteria as outlined in FASB ASC Topic 360, Property, Plant and Equipment, including management's intent to commit to a plan to sell the asset. NNN anticipates the disposition of Properties classified as held for sale to occur within 12 months.

Impairment – Real Estate. NNN periodically assesses its long-lived real estate assets for possible impairment whenever certain events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. These indicators include, but are not limited to: changes in real estate market conditions, the ability of NNN to re-lease properties that are currently vacant or become vacant, properties under contract and/or reclassified as held for sale, persistent vacancies greater than one year and properties leased to tenants in bankruptcy. Management evaluates whether an impairment in carrying value has occurred by comparing the estimated future cash flows (undiscounted and without interest charges), and the residual value of the real estate, with the carrying value of the individual asset. The future undiscounted cash flows are driven by estimated future market rents. Future cash flow estimates are sensitive to the assumptions made by management regarding future market rents, which are affected by expectations about future market and economic conditions. If an impairment is indicated, a loss will be recorded for the amount by which the carrying value of the asset exceeds its estimated fair value. NNN's Properties are predominantly leased to tenants under long-term net leases and held for investment. In most cases, NNN's Property leases provide for initial terms of 10 to 20 years, with cash flows provided over the entire term.

Revenue Recognition. Rental revenues for properties under construction commence upon completion of construction and delivery of the leased asset to the tenant. Rental revenues for non-development real estate assets are recognized when earned in accordance with ASC 842, based on the terms of the lease of the leased asset. Lease termination fees are recognized when collected subsequent to the related lease that is cancelled and NNN no longer has continuing involvement with the former tenant with respect to that property.

New Accounting Pronouncements. Refer to Note 1 of the December 31, 2025, Consolidated Financial Statements for a summary and the anticipated impact of each accounting pronouncement on NNN's financial position and results of operations.

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Results of Operations

Property Analysis

General. The following table summarizes the Property Portfolio as of December 31:

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]

Read the full FY 2025 MD&A: /company/NNN/mda/fy2025/
All MD&A years: /company/NNN/mda/


## MD&A history

Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page.

- [FY 2024 MD&A](/company/NNN/mda/fy2024/): filed 2025-02-11; accession 0000950170-25-017472 (https://www.sec.gov/Archives/edgar/data/751364/000095017025017472/nnn-20241231.htm)
- [FY 2023 MD&A](/company/NNN/mda/fy2023/): filed 2024-02-08; accession 0000950170-24-012540 (https://www.sec.gov/Archives/edgar/data/751364/000095017024012540/nnn-20231231.htm)
- [FY 2022 MD&A](/company/NNN/mda/fy2022/): filed 2023-02-09; accession 0000950170-23-002248 (https://www.sec.gov/Archives/edgar/data/751364/000095017023002248/nnn-20221231.htm)
- [FY 2021 MD&A](/company/NNN/mda/fy2021/): filed 2022-02-09; accession 0000950170-22-000944 (https://www.sec.gov/Archives/edgar/data/751364/000095017022000944/nnn-20211231.htm)




## Macro cross-references

Indicators mapped to this company's SIC classification (industry 6798 Real Estate Investment Trusts) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim.

- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units
- [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate

Macro-to-micro threads including this sector: [Interest rates & the Fed](/thread/interest-rates-fed/), [Money & trade](/thread/money-trade/), [Government finances](/thread/government-finances/), [Sector employment](/thread/sector-employment/).

All macro indicators: /indicators/


## For LLMs & downloads

Markdown twin: /company/NNN.md · JSON record: /company/NNN.json · verified financials: /company/NNN/financials.json / /company/NNN/financials.csv · machine TOC for the whole site: /llms.txt