Property Acquisitions

6 Months Ended

Jun. 30, 2023

NOTE 11. — PROPERTY ACQUISITIONS

2023

During the six months ended June 30, 2023, we acquired fee simple interests in 16 properties for an aggregate purchase price of $73,260,000 as follows (in thousands):


					Purchase Price Allocation
Asset Type	Properties		Purchase Price		Land		Buildings & Improve- ments		In-Place Leases		Above Market Leases/Prepaid Rent Receivable		Below Market Leases/Prepaid Rent Liability
Car wash properties		14	$	64,248	$	18,598	$	39,623	$	6,584	$	—	$	(557	)
Convenience stores (a)		1		6,336		2,405		3,319		612		—		—
Drive thru QSRs		1		2,676		675		1,713		288		—		—
		16	$	73,260	$	21,678	$	44,655	$	7,484	$	—	$	(557	)

(a)

Purchase price and land allocation include $913,000 related to the acquisition of a land parcel adjacent to an existing site which was subsequently combined with the existing site into a single property upon redevelopment of the existing site.

In addition, as part of a larger sale-leaseback transaction that included seven of the car wash properties referenced above, we acquired four car wash properties that were under construction for $8,543,000 and committed to provide additional funding to our tenant during the construction period to complete the development of these properties. These four properties did not meet the criteria for sale-leaseback accounting and are accounted for as finance receivables. Accordingly, this initial investment and all subsequent fundings made during the construction period are recorded within notes and mortgages receivable on our consolidated balance sheets, and rental payments resulting from these investments are recorded within interest on mortgages and notes receivable on our consolidated statements of operations. At the end of construction period, we will recognize the purchase of the assets, remove the finance receivables from the balance sheet, and begin to record rental income from the operating leases. During the three months ended June 30, 2023, an additional funding of $1,970,000 was provided. As of June 30, 2023, we have funded $10,513,000 related to these four properties.

This transaction also includes provisions that require us, upon the achievement by the tenant of certain financial performance targets within a defined period, to pay additional amounts to the tenant. Whether we will have to make any payments under these provisions is not probable or reasonably estimable at this time.

2022

During the six months ended June 30, 2022, we acquired fee simple interests in 14 properties for an aggregate purchase price of $54,197,000 as follows (in thousands):


					Purchase Price Allocation
Asset Type	Properties		Purchase Price		Land		Buildings & Improve- ments		In-Place Leases		Above Market Leases		Below Market Leases
Car wash properties		11	$	46,026	$	7,578	$	35,298	$	3,765	$	403	$	(1,018	)
Convenience stores		3	$	8,171	$	5,136	$	2,363	$	672		—		—
		14	$	54,197	$	12,714	$	37,661	$	4,437	$	403	$	(1,018	)