NOTE 13. — PROPERTY ACQUISITIONS

During the year ended December 31, 2017, we acquired fee simple interests in 103 convenience store and gasoline station properties for an aggregate purchase price of $214,000,000.

We evaluated these transactions under the new framework for determining whether an integrated set of assets and activities meets the definition of a business, pursuant to ASU 2017-01, which we early adopted effective January 1, 2017. Acquisitions that do not meet the definition of a business are accounted for as asset acquisitions. An integrated set of assets and activities does not qualify as a business if substantially all of the fair value of the gross assets is concentrated in either a single identifiable asset or a group of similar identifiable assets. We evaluated each of the acquisitions and determined that substantially all the fair value related to each acquisition is concentrated in a similar identifiable operating property. Accordingly, these transactions did not meet the definition of a business and consequently were accounted for as asset acquisitions. In each of these transactions, we allocated the total consideration for each acquisition to the individual assets acquired on a relative fair value basis.

On September 6, 2017, we acquired fee simple interests in 49 convenience store and gasoline station properties (the “Empire Properties”) for $123,126,000 and entered into a unitary lease with Empire Petroleum Partners, LLC (“Empire”) at the closing of the transaction (the “Empire Transaction”). We funded the Empire Transaction through a combination of funds from our Equity Offering and funds available under our Revolving Facility. The unitary lease provides for an initial term of 15 years, with four five-year renewal options. The unitary lease requires Empire to pay a fixed annual rent plus all amounts pertaining to the properties including environmental expenses, real estate taxes, assessments, license and permit fees, charges for public utilities and all other governmental charges. Rent is scheduled to increase annually during the initial and renewal terms of the lease. The Empire Properties are located primarily within metropolitan markets in the states of Arizona, Colorado, Florida, Georgia, Louisiana, New Mexico and Texas.

We accounted for the acquisition of the Empire Properties as an asset acquisition. We estimated the fair value of acquired tangible assets (consisting of land, buildings and improvements) “as if vacant.” Based on these estimates, we allocated $75,674,000 of the purchase price to land, $38,205,000 to buildings and improvements, $189,000 to above market leases and $9,058,000 to in-place leases.

On October 3, 2017, we acquired 38 fee simple properties (the “Applegreen Properties”) for $68,710,000 and entered into a unitary lease with U.S. subsidiary of Applegreen PLC (“Applegreen”) at the closing of the transaction (the “Applegreen Transaction”). We funded the Applegreen Transaction through a combination of funds from our Equity Offering and funds available under our Revolving Facility. The unitary lease provides for an initial term of 15 years, with four five-year renewal options. The unitary lease requires Applegreen to pay a fixed annual rent plus all amounts pertaining to the properties including environmental expenses, real estate taxes, assessments, license and permit fees, charges for public utilities and all other governmental charges. Rent is scheduled to increase on the fifth anniversary of the commencement of the lease and annually thereafter. The Applegreen Properties consist of 33 convenience store and gasoline stations, and five stand-alone Burger King quick service restaurants located within the metropolitan market of Columbia, SC.

We accounted for the acquisition of the Applegreen Properties as an asset acquisition. We estimated the fair value of acquired tangible assets (consisting of land, buildings and improvements) “as if vacant.” Based on these estimates, we allocated $36,874,000 of the purchase price to land, $27,431,000 to buildings and improvements, $961,000 to above market leases, $1,104,000 to below market leases, which is accounted for as a deferred liability, and $4,548,000 to in-place leases.

In addition, during the year ended December 31, 2017, we acquired fee simple interests in 16 convenience store and gasoline station properties, in separate transactions, for an aggregate purchase price of $22,164,000. We accounted for these transactions as asset acquisitions. We estimated the fair value of acquired tangible assets for each of these transactions (consisting of land, buildings and improvements) “as if vacant.” Based on these estimates, we allocated $5,800,000 of the purchase price to land, $14,424,000 to buildings and improvements, $1,028,000 to below market leases, which is accounted for as a deferred liability, and $2,969,000 to in-place leases.

During the year ended December 31, 2016, we acquired fee simple or leasehold interests in three convenience store and gasoline station properties and an adjacent parcel of land to an existing property for a redevelopment project, in separate transactions, for an aggregate purchase price of $7,688,000. We accounted for the acquisitions of fee simple interests and leasehold title as business combinations. We estimated the fair value of acquired tangible assets (consisting of land, buildings and improvements) “as if vacant.” Based on these estimates, we allocated $1,041,000 of the purchase price to land, $6,111,000 to buildings and improvements and $374,000 to in-place leases. In addition, we purchased an adjacent parcel of land to an existing property for a redevelopment project for $162,000. We incurred transaction costs of $86,000 directly related to these acquisitions which are included in general and administrative expenses in our consolidated statements of operations.

Unaudited Pro Forma Condensed Consolidated Financial Information

The following unaudited pro forma condensed consolidated financial information has been prepared utilizing our historical financial statements and the combined effect of additional revenue and expenses from the properties acquired in the United Oil Transaction assuming that the acquisitions had occurred on January 1, 2014, after giving effect to certain adjustments resulting from the straight-lining of scheduled rent increases. The following information also gives effect to the additional interest expense resulting from the assumed increase in borrowings outstanding under the Credit Agreement and the Second Restated Prudential Note Purchase Agreement to fund the transaction. The unaudited pro forma condensed financial information is not indicative of the results of operations that would have been achieved had the transaction reflected herein been consummated on the dates indicated or that will be achieved in the future.

(in thousands, except per share data)	Year ended December 31,
	2015
Revenues from continuing operations	$	118,045
Earnings from continuing operations	$	40,872
Basic and diluted earnings from continuing operations per common share	$	1.21

Total revenues for the United Oil Transaction included in continuing operations were $17,625,000, $17,631,000 and $10,177,000 for the years ended December 31, 2017, 2016 and 2015, respectively. Net earnings for the United Oil Transaction were $12,087,000, $11,762,000 and $6,952,000 for the years ended December 31, 2017, 2016 and 2015, respectively.