10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2016

	OR
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _________ to __________

Commission file numbers: 001-35263 and 333-197780

VEREIT, Inc.

VEREIT Operating Partnership, L.P.

(Exact name of registrant as specified in its charter)

Maryland (VEREIT, Inc.)	45-2482685
Delaware (VEREIT Operating Partnership, L.P.)	45-1255683
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
2325 E. Camelback Road, Suite 1100, Phoenix, AZ	85016
(Address of principal executive offices)	(Zip Code)

(800) 606-3610

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. VEREIT, Inc. Yes x No o VEREIT Operating Partnership, L.P. Yes x No o

Indicate by check mark whether the registrant submitted electronically and posted on its corporate Web Site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). VEREIT, Inc. Yes x No o VEREIT Operating Partnership, L.P. Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

VEREIT, Inc.	Large accelerated filer x		Accelerated filer o
	Non-accelerated filer o	(Do not check if a smaller reporting company)	Smaller reporting company o

VEREIT Operating Partnership, L.P.	Large accelerated filer o		Accelerated filer o
	Non-accelerated filer x	(Do not check if a smaller reporting company)	Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

VEREIT, Inc. Yes o No x VEREIT Operating Partnership, L.P. Yes o No x

There were 904,842,650 shares of common stock of VEREIT, Inc. outstanding as of May 3, 2016.

EXPLANATORY NOTE

This report combines the Quarterly Reports on Form 10-Q for the three months ended March 31, 2016 of VEREIT, Inc., a Maryland corporation, and VEREIT Operating Partnership, L.P., a Delaware limited partnership, of which VEREIT, Inc. is the sole general partner. Unless otherwise indicated or unless the context requires otherwise, all references in this report to “we,” “us,” “our,” the “Company” or the “General Partner” mean VEREIT, Inc. together with its consolidated subsidiaries, including VEREIT Operating Partnership, L.P., and all references to the “Operating Partnership” or “OP” mean VEREIT Operating Partnership, L.P. together with its consolidated subsidiaries.

As the sole general partner of VEREIT Operating Partnership, L.P., VEREIT, Inc. has the full, exclusive and complete responsibility for the Operating Partnership’s day-to-day management and control.

We believe combining the Quarterly Reports on Form 10-Q of VEREIT, Inc. and VEREIT Operating Partnership, L.P. into this single report results in the following benefits:

• enhancing investors’ understanding of the Company and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;

• eliminating duplicative disclosure and providing a more streamlined and readable presentation since a substantial portion of the disclosure applies to both the Company and the Operating Partnership; and

• creating time and cost efficiencies through the preparation of one combined report instead of two separate reports.

There are a few differences between the Company and the Operating Partnership, which are reflected in the disclosure in this report. We believe it is important to understand the differences between the Company and the Operating Partnership in the context of how we operate as an interrelated consolidated company. VEREIT, Inc. is a real estate investment trust whose only material asset is its ownership of partnership interests of the Operating Partnership. As a result, VEREIT, Inc. does not conduct business itself, other than acting as the sole general partner of the Operating Partnership, issuing public equity or debt from time to time and guaranteeing certain unsecured debt of the Operating Partnership and certain of its subsidiaries. The Operating Partnership holds substantially all of the assets of the Company and holds the ownership interests in the Company’s joint ventures. The Operating Partnership conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for net proceeds from public equity issuances by VEREIT, Inc., which are generally contributed to the Operating Partnership in exchange for partnership units, the Operating Partnership generates the capital required by the Company’s business through the Operating Partnership’s operations, by the Operating Partnership’s direct or indirect incurrence of indebtedness or through the issuance of partnership units. To help investors understand the significant differences between VEREIT, Inc. and the Operating Partnership, there are separate sections in this report, as applicable, that separately discuss VEREIT, Inc. and the Operating Partnership, including the consolidated financial statements and certain notes to the consolidated financial statements as well as separate Exhibit 31 and Exhibit 32 certifications. As general partner with control of the Operating Partnership, VEREIT, Inc. consolidates the Operating Partnership for financial reporting purposes. Therefore, the assets and liabilities of VEREIT, Inc. and VEREIT Operating Partnership, L.P. are the same on their respective consolidated financial statements. The separate discussions of VEREIT, Inc. and VEREIT Operating Partnership, L.P. in this report should be read in conjunction with each other to understand the results of the Company on a consolidated basis and how management operates the Company.

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

For the quarterly period ended March 31, 2016

	Page
PART I
Item 1. Financial Statements	2
Consolidated Balance Sheets of VEREIT, Inc. as of March 31, 2016 and December 31, 2015	2
Consolidated Statements of Operations of VEREIT, Inc. for the Three Months Ended March 31, 2016 and 2015	3
Consolidated Statements of Comprehensive Income (Loss) of VEREIT, Inc. for the Three Months Ended March 31, 2016 and 2015	4
Consolidated Statements of Changes in Equity of VEREIT, Inc. for the Three Months Ended March 31, 2016 and 2015	5
Consolidated Statements of Cash Flows of VEREIT, Inc. for the Three Months Ended March 31, 2016 and 2015	6
Consolidated Balance Sheets of VEREIT Operating Partnership, L.P. as of March 31, 2016 and December 31, 2015	7
Consolidated Statements of Operations of VEREIT Operating Partnership, L.P. for the Three Months Ended March 31, 2016 and 2015	8
Consolidated Statements of Comprehensive Income (Loss) of VEREIT Operating Partnership, L.P. for the Three Months Ended March 31, 2016 and 2015	9
Consolidated Statements of Changes in Equity of VEREIT Operating Partnership, L.P. for the Three Months Ended March 31, 2016 and 2015	10
Consolidated Statements of Cash Flows of VEREIT Operating Partnership, L.P. for the Three Months Ended March 31, 2016 and 2015	11
Notes to Consolidated Financial Statements	12
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	51
Item 3. Quantitative and Qualitative Disclosures About Market Risk	69
Item 4. Controls and Procedures	70
PART II
Item 1. Legal Proceeding	71
Item 1A. Risk Factors	71
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	71
Item 3. Defaults Upon Senior Securities	71
Item 4. Mine Safety Disclosures	71
Item 5. Other Information	71
Item 6. Exhibits	71
Signatures	72

1

VEREIT, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except for share and per share data) (Unaudited)

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

	March 31, 2016			December 31, 2015
ASSETS
Real estate investments, at cost:
Land	$	3,058,879		$	3,120,653
Buildings, fixtures and improvements	11,161,327			11,445,690
Intangible lease assets	2,145,734			2,218,378
Total real estate investments, at cost	16,365,940			16,784,721
Less: accumulated depreciation and amortization	1,865,674			1,778,597
Total real estate investments, net	14,500,266			15,006,124
Investment in unconsolidated entities	23,445			56,824
Investment in direct financing leases, net	45,611			46,312
Investment securities, at fair value	48,162			53,304
Mortgage notes receivable, net	23,559			24,238
Cash and cash equivalents	104,450			69,103
Restricted cash	60,132			59,767
Intangible assets, net	43,327			50,779
Rent and tenant receivables and other assets, net	313,903			303,637
Goodwill	1,642,858			1,656,374
Due from affiliates	11,617			60,633
Real estate assets held for sale, net	26,282			18,771
Total assets	$	16,843,612		$	17,405,866
LIABILITIES AND STOCKHOLDERS’ EQUITY
Mortgage notes payable and other debt, net	$	3,029,666		$	3,111,985
Corporate bonds, net	2,537,699			2,536,333
Convertible debt, net	965,469			962,894
Credit facility, net	1,269,731			1,448,590
Below-market lease liabilities, net	245,093			251,692
Accounts payable and accrued expenses	118,970			151,877
Deferred rent, derivative and other liabilities	88,997			87,490
Distributions payable	143,973			140,816
Due to affiliates	—			230
Total liabilities	8,399,598			8,691,907
Commitments and contingencies (Note 14)
Preferred stock, $0.01 par value, 100,000,000 shares authorized and 42,834,138 issued and outstanding as of each of March 31, 2016 and December 31, 2015	428			428
Common stock, $0.01 par value, 1,500,000,000 shares authorized and 904,757,365 and 904,884,394 issued and outstanding as of March, 31, 2016 and December, 31, 2015, respectively	9,048			9,049
Additional paid-in-capital	11,932,859			11,931,768
Accumulated other comprehensive loss	(11,345		)	(2,025		)
Accumulated deficit	(3,671,050		)	(3,415,233		)
Total stockholders’ equity	8,259,940			8,523,987
Non-controlling interests	184,074			189,972
Total equity	8,444,014			8,713,959
Total liabilities and equity	$	16,843,612		$	17,405,866

The accompanying notes are an integral part of these statements.

2

VEREIT, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except for per share data) (Unaudited)

	Three Months Ended March 31,
	2016			2015
Revenues:
Rental income	$	313,971		$	342,759
Direct financing lease income	569			741
Operating expense reimbursements	23,247			22,974
Cole Capital revenue	31,233			27,494
Total revenues	369,020			393,968
Operating expenses:
Cole Capital reallowed fees and commissions	8,068			2,031
Acquisition related	242			2,182
Litigation and other non-routine costs, net of insurance recoveries	(5,175		)	16,423
Property operating	34,813			30,999
General and administrative	29,400			33,106
Depreciation and amortization	204,308			219,141
Impairments	160,517			—
Total operating expenses	432,173			303,882
Operating (loss) income	(63,153		)	90,086
Other (expense) income:
Interest expense	(80,426		)	(95,699		)
Gain on extinguishment and forgiveness of debt, net	—			5,302
Other income, net	1,062			4,060
Equity in income and gain on disposition of unconsolidated entities	10,404			28
Loss on derivative instruments, net	(1,086		)	(1,028		)
Total other expenses, net	(70,046		)	(87,337		)
(Loss) income before taxes and real estate dispositions	(133,199		)	2,749
Gain (loss) on disposition of real estate, net	17,175			(31,368		)
Loss before taxes	(116,024		)	(28,619		)
Provision for income taxes	(56		)	(2,074		)
Net loss	(116,080		)	(30,693		)
Net loss attributable to non-controlling interests (1)	2,994			723
Net loss attributable to the General Partner	$	(113,086	)	$	(29,970	)
Basic and diluted net loss per share attributable to common stockholders	$	(0.15	)	$	(0.05	)
Distributions declared per common share	$	0.14		$	—

_______________________________________________

(1) Represents loss attributable to limited partners and consolidated joint venture partners.

The accompanying notes are an integral part of these statements.

3

VEREIT, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands) (Unaudited)

	Three Months Ended March 31,
	2016			2015
Net loss	$	(116,080	)	$	(30,693	)
Other comprehensive loss:
Unrealized loss on interest rate derivatives	(9,702		)	(10,396		)
Amount of loss reclassified from accumulated other comprehensive loss into net loss as interest expense	2,099			2,736
Unrealized (loss) gain on investment securities, net	(1,961		)	796
Total other comprehensive loss	(9,564		)	(6,864		)
Total comprehensive loss	(125,644		)	(37,557		)
Comprehensive loss attributable to non-controlling interests (1)	3,238			723
Total comprehensive loss attributable to the General Partner	$	(122,406	)	$	(36,834	)

_______________________________________________

(1) Represents loss attributable to limited partners and consolidated joint venture partners.

The accompanying notes are an integral part of these statements.

4

VEREIT, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In thousands, except for share data) (Unaudited)

	Preferred Stock			Common Stock
	Number of Shares	Par Value		Number of Shares		Par Value			Additional Paid-In Capital			Accumulated Other Comprehensive Income			Accumulated Deficit			Total Stock-holders’ Equity			Non-Controlling Interests			Total Equity
Balance, January 1, 2016	42,834,138	$	428	904,884,394		$	9,049		$	11,931,768		$	(2,025	)	$	(3,415,233	)	$	8,523,987		$	189,972		$	8,713,959
Repurchases of common stock to settle tax obligation	—	—		(127,741	)	(1		)	(1,023		)	—			—			(1,024		)	—			(1,024		)
Equity-based compensation, net	—	—		712		—			1,730			—			—			1,730			—			1,730
Contributions from non-controlling interest holders	—	—		—		—			—			—			—			—			675			675
Distributions declared on common stock	—	—		—		—			—			—			(124,285		)	(124,285		)	—			(124,285		)
Distributions to non-controlling interest holders	—	—		—		—			—			—			—			—			(3,299		)	(3,299		)
Distributions to participating securities	—	—		—		—			—			—			(125		)	(125		)	—			(125		)
Distributions to preferred shareholders and unitholders	—	—		—		—			—			—			(17,937		)	(17,937		)	(36		)	(17,973		)
Cumulative-effect adjustment for equity-based compensation forfeitures	—	—		—		—			384			—			(384		)	—			—			—
Net loss	—	—		—		—			—			—			(113,086		)	(113,086		)	(2,994		)	(116,080		)
Other comprehensive loss	—	—		—		—			—			(9,320		)	—			(9,320		)	(244		)	(9,564		)
Balance, March 31, 2016	42,834,138	$	428	904,757,365		$	9,048		$	11,932,859		$	(11,345	)	$	(3,671,050	)	$	8,259,940		$	184,074		$	8,444,014

	Preferred Stock			Common Stock
	Number of Shares	Par Value		Number of Shares		Par Value			Additional Paid-In Capital			Accumulated Other Comprehensive Income			Accumulated Deficit			Total Stock-holders’ Equity			Non-Controlling Interests			Total Equity
Balance, January 1, 2015	42,834,138	$	428	905,530,431		$	9,055		$	11,920,253		$	2,728		$	(2,778,576	)	$	9,153,888		$	228,442		$	9,382,330
Repurchases of common stock to settle tax obligation	—	—		(132,826	)	(1		)	(1,206		)	—			—			(1,207		)	—			(1,207		)
Equity-based compensation, net	—	—		(262,886	)	(3		)	821			—			—			818			—			818
Tax shortfall from equity-based compensation	—	—		—		—			(510		)	—			—			(510		)	—			(510		)
Distributions to non-controlling interest holders	—	—		—		—			—			—			—			—			(464		)	(464		)
Distributions to participating securities	—	—		—		—			—			—			(5		)	(5		)	—			(5		)
Distributions to preferred shareholders	—	—		—		—			—			—			(17,973		)	(17,973		)	—			(17,973		)
Net loss	—	—		—		—			—			—			(29,970		)	(29,970		)	(723		)	(30,693		)
Other comprehensive loss	—	—		—		—			—			(6,864		)	—			(6,864		)	—			(6,864		)
Balance, March 31, 2015	42,834,138	$	428	905,134,719		$	9,051		$	11,919,358		$	(4,136	)	$	(2,826,524	)	$	9,098,177		$	227,255		$	9,325,432

The accompanying notes are an integral part of these statements.

5

VEREIT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands) (Unaudited)

	Three Months Ended March 31,
	2016			2015
Cash flows from operating activities:
Net loss	$	(116,080	)	$	(30,693	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	208,362			224,111
(Gain) loss on real estate assets and joint venture, net	(27,373		)	31,368
Impairments	160,517			—
Equity-based compensation	1,730			818
Equity in income of unconsolidated entities	(206		)	(28		)
Distributions from unconsolidated entities	1,491			2,866
Loss on derivative instruments	1,086			1,028
(Gain) on investment securities	—			(233		)
Gain on extinguishment and forgiveness of debt, net	—			(5,307		)
Changes in assets and liabilities:
Investment in direct financing leases	701			495
Rent and tenant receivables and other assets, net	(13,024		)	(30,757		)
Due from affiliates	(984		)	27,665
Accounts payable and accrued expenses	(32,556		)	2,013
Deferred rent, derivative and other liabilities	(4,822		)	6,798
Due to affiliates	(230		)	(12		)
Net cash provided by operating activities	178,612			230,132
Cash flows from investing activities:
Investments in real estate assets	(19,952		)	(7,627		)
Capital expenditures and leasing costs	(5,388		)	(3,649		)
Real estate developments	(554		)	(15,998		)
Principal repayments received from borrowers	3,863			3,668
Proceeds from disposition of real estate and joint venture	176,137			245,548
Investment in leasehold improvements and other assets	(574		)	—
Deposits for real estate assets	(3,818		)	(3,509		)
Uses and refunds of deposits for real estate assets	2,019			7,939
Line of credit advances to affiliates	—			(10,000		)
Line of credit repayments from affiliates	50,000			10,000
Change in restricted cash	(365		)	(6,315		)
Net cash provided by investing activities	201,368			220,057
Cash flows from financing activities:
Proceeds from mortgage notes payable	206			1,158
Payments on mortgage notes payable and other debt	(21,948		)	(59,308		)
Proceeds from credit facilities	203,000			—
Payments on credit facilities	(383,000		)	—
Payments of deferred financing costs	(240		)	(326		)
Repurchases of common stock to settle tax obligations	(801		)	(1,207		)
Contributions from non-controlling interest holders	675			—
Distributions paid	(142,525		)	(18,478		)
Net cash used in financing activities	(344,633		)	(78,161		)
Net change in cash and cash equivalents	35,347			372,028
Cash and cash equivalents, beginning of period	69,103			416,711
Cash and cash equivalents, end of period	$	104,450		$	788,739

The accompanying notes are an integral part of these statements.

6

VEREIT OPERATING PARTNERSHIP, L.P.

CONSOLIDATED BALANCE SHEETS

(In thousands, except for unit data) (Unaudited)

	March 31, 2016		December 31, 2015
ASSETS
Real estate investments, at cost:
Land	$	3,058,879	$	3,120,653
Buildings, fixtures and improvements	11,161,327		11,445,690
Intangible lease assets	2,145,734		2,218,378
Total real estate investments, at cost	16,365,940		16,784,721
Less: accumulated depreciation and amortization	1,865,674		1,778,597
Total real estate investments, net	14,500,266		15,006,124
Investment in unconsolidated entities	23,445		56,824
Investment in direct financing leases, net	45,611		46,312
Investment securities, at fair value	48,162		53,304
Mortgage notes receivable, net	23,559		24,238
Cash and cash equivalents	104,450		69,103
Restricted cash	60,132		59,767
Intangible assets, net	43,327		50,779
Rent and tenant receivables and other assets, net	313,903		303,637
Goodwill	1,642,858		1,656,374
Due from affiliates	11,617		60,633
Real estate assets held for sale, net	26,282		18,771
Total assets	$	16,843,612	$	17,405,866
LIABILITIES AND EQUITY
Mortgage notes payable and other debt, net	$	3,029,666	$	3,111,985
Corporate bonds, net	2,537,699		2,536,333
Convertible debt, net	965,469		962,894
Credit facility, net	1,269,731		1,448,590
Below-market lease liabilities, net	245,093		251,692
Accounts payable and accrued expenses	118,970		151,877
Deferred rent, derivative and other liabilities	88,997		87,490
Distributions payable	143,973		140,816
Due to affiliates	—		230
Total liabilities	8,399,598		8,691,907
Commitments and contingencies (Note 14)
General partner's preferred equity, 42,834,138 General Partner Preferred Units issued and outstanding as of each of March 31, 2016 and December 31, 2015	907,632		925,569
General partner's common equity, 904,757,365 and 904,884,394 General Partner OP Units issued and outstanding as of March 31, 2016 and December 31, 2015, respectively	7,352,308		7,598,418
Limited partner's preferred equity, 86,874 Limited Partner Preferred Units issued and outstanding as of each of March 31, 2016 and December 31, 2015	3,279		3,315
Limited partner's common equity, 23,763,797 Limited Partner OP Units issued and outstanding as of each of March 31, 2016 and December 31, 2015	178,332		184,800
Total partners’ equity	8,441,551		8,712,102
Non-controlling interests	2,463		1,857
Total equity	8,444,014		8,713,959
Total liabilities and equity	$	16,843,612	$	17,405,866

The accompanying notes are an integral part of these statements.

7

VEREIT OPERATING PARTNERSHIP, L.P.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except for per unit data) (Unaudited)

	Three Months Ended March 31,
	2016			2015
Revenues:
Rental income	$	313,971		$	342,759
Direct financing lease income	569			741
Operating expense reimbursements	23,247			22,974
Cole Capital revenue	31,233			27,494
Total revenues	369,020			393,968
Operating expenses:
Cole Capital reallowed fees and commissions	8,068			2,031
Acquisition related	242			2,182
Litigation and other non-routine costs, net of insurance recoveries	(5,175		)	16,423
Property operating	34,813			30,999
General and administrative	29,400			33,106
Depreciation and amortization	204,308			219,141
Impairments	160,517			—
Total operating expenses	432,173			303,882
Operating (loss) income	(63,153		)	90,086
Other (expense) income:
Interest expense	(80,426		)	(95,699		)
Gain on extinguishment and forgiveness of debt, net	—			5,302
Other income, net	1,062			4,060
Equity in income and gain on disposition of unconsolidated entities	10,404			28
Loss on derivative instruments, net	(1,086		)	(1,028		)
Total other expenses, net	(70,046		)	(87,337		)
Loss before taxes and real estate dispositions	(133,199		)	2,749
Gain (loss) on disposition of real estate, net	17,175			(31,368		)
Loss before taxes	(116,024		)	(28,619		)
Provision for income taxes	(56		)	(2,074		)
Net loss	(116,080		)	(30,693		)
Net loss (income) attributable to non-controlling interests (1)	39			(180		)
Net loss attributable to the OP	$	(116,041	)	$	(30,873	)
Basic and diluted net loss per unit attributable to common unitholders	$	(0.15	)	$	(0.05	)
Distributions declared per common unit	$	0.14		$	—

_______________________________________________

(1) Represents loss (income) attributable to consolidated joint venture partners.

The accompanying notes are an integral part of these statements.

8

VEREIT OPERATING PARTNERSHIP, L.P.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands) (Unaudited)

	Three Months Ended March 31,
	2016			2015
Net loss	$	(116,080	)	$	(30,693	)
Other comprehensive loss:
Unrealized loss on interest rate derivatives	(9,702		)	(10,396		)
Amount of loss reclassified from accumulated other comprehensive loss into income as interest expense	2,099			2,736
Unrealized (loss) gain on investment securities, net	(1,961		)	796
Total other comprehensive loss	(9,564		)	(6,864		)
Total comprehensive loss	(125,644		)	(37,557		)
Comprehensive (income) loss attributable to non-controlling interests (1)	39			(180		)
Total comprehensive loss attributable to the OP	$	(125,605	)	$	(37,737	)

_______________________________________________

(1) Represents loss attributable to consolidated joint venture partners.

The accompanying notes are an integral part of these statements.

9

VEREIT OPERATING PARTNERSHIP, L.P.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In thousands, except for unit data) (Unaudited)

	Preferred Units								Common Units
	General Partner				Limited Partner				General Partner					Limited Partner
	Number of Units	Capital			Number of Units	Capital			Number of Units		Capital			Number of Units	Capital			Total Partners' Capital			Non-Controlling Interests			Total Capital
Balance, January 1, 2016	42,834,138	$	925,569		86,874	$	3,315		904,884,394		$	7,598,418		23,763,797	$	184,800		$	8,712,102		$	1,857		$	8,713,959
Repurchases of common OP Units to settle tax obligation	—	—			—	—			(127,741	)	(1,024		)	—	—			(1,024		)	—			(1,024		)
Equity-based compensation	—	—			—	—			712		1,730			—	—			1,730			—			1,730
Contributions from non-controlling interest holders	—	—			—	—			—		—			—	—			—			675			675
Distributions to Common OP Units and non-controlling interest holders	—	—			—	—			—		(124,410		)	—	(3,269		)	(127,679		)	(30		)	(127,709		)
Distributions to Preferred OP Units	—	(17,937		)	—	(36		)	—		—			—	—			(17,973		)	—			(17,973		)
Net loss	—	—			—	—			—		(113,086		)	—	(2,955		)	(116,041		)	(39		)	(116,080		)
Other comprehensive loss	—	—			—	—			—		(9,320		)	—	(244		)	(9,564		)	—			(9,564		)
March 31, 2016	42,834,138	$	907,632		86,874	$	3,279		904,757,365		$	7,352,308		23,763,797	$	178,332		$	8,441,551		$	2,463		$	8,444,014

	Preferred Units							Common Units
	General Partner				Limited Partner			General Partner					Limited Partner
	Number of Units	Capital			Number of Units	Capital		Number of Units		Capital			Number of Units	Capital			Total Partners' Capital			Non-Controlling Interests			Total Capital
Balance, January 1, 2015	42,834,138	$	996,987		86,874	$	3,375	905,530,431		$	8,157,167		23,763,797	$	201,102		$	9,358,631		$	23,699		$	9,382,330
Repurchases of common OP units to settle tax obligation	—	—			—	—		(132,826	)	(1,207		)	—	—			(1,207		)	—			(1,207		)
Equity-based compensation, net forfeitures	—	—			—	—		(262,886	)	818			—	—			818			—			818
Excess tax benefit	—	—			—	—		—		(510		)	—	—			(510		)	—			(510		)
Distributions to Common OP Units and non-controlling interests	—	—			—	—		—		(5		)	—	—			(5		)	(464		)	(469		)
Distributions to Preferred OP Units	—	(17,973		)	—	—		—		—			—	—			(17,973		)	—			(17,973		)
Net loss	—	—			—	—		—		(29,970		)	—	(903		)	(30,873		)	180			(30,693		)
Other comprehensive loss	—	—			—	—		—		(6,657		)	—	(207		)	(6,864		)	—			(6,864		)
March 31, 2015	42,834,138	$	979,014		86,874	$	3,375	905,134,719		$	8,119,636		23,763,797	$	199,992		$	9,302,017		$	23,415		$	9,325,432

The accompanying notes are an integral part of these statements.

10

VEREIT OPERATING PARTNERSHIP, L.P.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands) (Unaudited)

	Three Months Ended March 31,
	2016			2015
Cash flows from operating activities:
Net loss	$	(116,080	)	$	(30,693	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	208,362			224,111
(Gain) loss on real estate assets and joint venture, net	(27,373		)	31,368
Impairments	160,517			—
Equity-based compensation	1,730			818
Equity in income of unconsolidated entities	(206		)	(28		)
Distributions from unconsolidated entities	1,491			2,866
Loss on derivative instruments	1,086			1,028
Gain on investment securities	—			(233		)
Gain on extinguishment and forgiveness of debt, net	—			(5,307		)
Changes in assets and liabilities:
Investment in direct financing leases	701			495
Rent and tenant receivables and other assets, net	(13,024		)	(30,757		)
Due from affiliates	(984		)	27,665
Accounts payable and accrued expenses	(32,556		)	2,013
Deferred rent, derivative and other liabilities	(4,822		)	6,798
Due to affiliates	(230		)	(12		)
Net cash provided by operating activities	178,612			230,132
Cash flows from investing activities:
Investments in real estate assets	(19,952		)	(7,627		)
Capital expenditures and leasing costs	(5,388		)	(3,649		)
Real estate developments	(554		)	(15,998		)
Principal repayments received from borrowers	3,863			3,668
Proceeds from disposition of real estate and joint venture	176,137			245,548
Investment in leasehold improvements and other assets	(574		)	—
Deposits for real estate assets	(3,818		)	(3,509		)
Uses and refunds of deposits for real estate assets	2,019			7,939
Line of credit advances to affiliates	—			(10,000		)
Line of credit repayments from affiliates	50,000			10,000
Change in restricted cash	(365		)	(6,315		)
Net cash provided by investing activities	201,368			220,057
Cash flows from financing activities:
Proceeds from mortgage notes payable	206			1,158
Payments on mortgage notes payable and other debt	(21,948		)	(59,308		)
Proceeds from credit facilities	203,000			—
Payments on credit facilities	(383,000		)	—
Payments of deferred financing costs	(240		)	(326		)
Repurchases of common units to settle tax obligations	(801		)	(1,207		)
Contributions from non-controlling interest holders	675			—
Distributions paid	(142,525		)	(18,478		)
Net cash used in financing activities	(344,633		)	(78,161		)
Net change in cash and cash equivalents	35,347			372,028
Cash and cash equivalents, beginning of period	69,103			416,711
Cash and cash equivalents, end of period	$	104,450		$	788,739

The accompanying notes are an integral part of these statements.

11

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited)

Note 1 – Organization

VEREIT, Inc. (the “General Partner” or “VEREIT”), is a Maryland corporation, incorporated on December 2, 2010, that qualified as a real estate investment trust (“REIT”) for U.S. federal income tax purposes beginning in the taxable year ended December 31, 2011. VEREIT Operating Partnership, L.P. (together with its subsidiaries, the “Operating Partnership” or the “OP”), is a Delaware limited partnership of which the General Partner is the sole general partner. VEREIT’s common stock, par value $0.01 per share (“Common Stock”), and its 6.70% Series F Cumulative Redeemable Preferred Stock, par value $0.01 per share (“Series F Preferred Stock”) trade on the New York Stock Exchange (“NYSE”) under the trading symbols, “VER” and “VER PRF,” respectively. As used herein, the terms the “Company,” “we,” “our” and “us” refer to VEREIT, together with its consolidated subsidiaries, including the OP.

The Company is a full-service real estate operating company with investment management capabilities that operates through two reportable segments, its real estate investment (“REI”) segment and its investment management segment, Cole Capital (“Cole Capital”), as further discussed in Note 3 –Segment Reporting. Through the REI segment, the Company owns and actively manages a diversified portfolio of retail, restaurant, office and industrial real estate properties subject to long-term net leases with creditworthy tenants. The Company actively manages its portfolio considering a number of metrics including property type, concentration and key economic factors for appropriate balance and diversity. Through the Cole Capital segment, the Company is responsible for raising capital for and managing the affairs of the Cole REITs (as defined in Note 3 –Segment Reporting) on a day-to-day basis, identifying and making acquisitions and investments on the Cole REITs’ behalf and recommending to the respective board of directors of each of the Cole REITs an approach for providing investors with liquidity. Cole Capital receives compensation and reimbursement for performing these services. To support both reportable segments, the Company employs a shared services model pursuant to which its personnel are integral in providing, among other things, transactional and operational functions to the Company’s owned portfolio and the Cole REITs.

Substantially all of the REI segment’s operations are conducted through the OP. VEREIT is the sole general partner and holder of 97.4% of the common equity interests in the OP as of March 31, 2016 with the remaining 2.6% of the common equity interests owned by unaffiliated investors and certain former directors, officers and employees of ARC Properties Advisors, LLC (the “Former Manager”). Under the limited partnership agreement of the OP, as amended (the “LPA”), after holding units of limited partner interests in the OP (“OP Units”) for a period of one year, unless an earlier redemption is otherwise consented to by VEREIT, holders of OP Units have the right to redeem the OP Units for the cash value of a corresponding number of shares of VEREIT’s Common Stock or, at the option of VEREIT, a corresponding number of shares of VEREIT’s Common Stock. The remaining rights of the holders of OP Units are limited, however, and do not include the ability to replace the General Partner or to approve the sale, purchase or refinancing of the OP’s assets. Substantially all of the Cole Capital segment’s operations are conducted through Cole Capital Advisors, Inc. (“CCA”), an Arizona corporation and a wholly owned subsidiary of the OP. CCA is treated as a taxable REIT subsidiary (“TRS”) under Section 856 of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”).

The actions of the OP and its relationship with the General Partner are governed by the LPA. The General Partner does not have any significant assets other than its investment in the OP. Therefore, the assets and liabilities of the General Partner and the OP are substantially the same. Additionally, pursuant to the LPA, all administrative expenses and expenses associated with the formation, continuity, existence and operation of the General Partner incurred by the General Partner on the OP’s behalf shall be treated as expenses of the OP. Further, when the General Partner issues any equity instrument that has been approved by the General Partner’s board of directors, the LPA requires the OP to issue to the General Partner equity instruments with substantially similar terms, to protect the integrity of the Company’s umbrella partnership REIT structure, pursuant to which each holder of interests in the OP has a proportionate economic interest in the OP reflecting its capital contributions thereto. OP Units issued to the General Partner are referred to as General Partner OP Units. OP Units issued to parties other than the General Partner are referred to as Limited Partner OP Units. The LPA also provides that the OP issue debt with terms and provisions consistent with debt issued by the General Partner. The LPA will be amended to provide for the issuance of any additional class of equivalent equity instruments to the extent the General Partner’s board of directors authorizes the issuance of any new class of equity securities.

12

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Note 2 –Summary of Significant Accounting Policies

Basis of Accounting

The consolidated financial statements of the Company presented herein include the accounts of the General Partner and its consolidated subsidiaries, including the OP. All intercompany transactions have been eliminated upon consolidation. The financial statements are prepared on the accrual basis of accounting in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The information furnished includes all adjustments and accruals of a normal recurring nature, which, in the opinion of management, are necessary for a fair presentation of results for the interim periods. The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results for the entire year or any subsequent interim period.

These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of and for the year ended December 31, 2015 of the Company, which are included in the Company’s Annual Report on Form 10-K filed February 24, 2016. There have been no significant changes to the Company’s significant accounting policies during the three months ended March 31, 2016. Information and footnote disclosures normally included in financial statements have been condensed or omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”).

Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of the Company and its subsidiaries and consolidated joint venture arrangements. The portions of the consolidated joint venture arrangements not owned by the Company are presented as non-controlling interests in VEREIT’s and the OP’s consolidated balance sheets, statements of operations, statements of comprehensive income (loss) and statements of changes in equity. In addition, as described in Note 1 – Organization, certain third parties have been issued OP Units. Holders of OP Units are considered to be non-controlling interest holders in the OP and their ownership interest in the limited partner’s share is presented as non-controlling interests in VEREIT’s consolidated balance sheets, statements of operations, statements of comprehensive income (loss) and statements of changes in equity. Further, a portion of the earnings and losses of the OP are allocated to non-controlling interest holders based on their respective ownership percentages. Upon conversion of OP Units to Common Stock, any difference between the fair value of shares of Common Stock issued and the carrying value of the OP Units converted is recorded as a component of equity. As of both March 31, 2016 and December 31, 2015, there were approximately 23.8 million Limited Partner OP Units outstanding.

During the year ended December 31, 2015, the Company early adopted the U.S. Financial Accounting Standards Board (the “FASB”) Accounting Standards Update, (“ASU”) No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis (“ASU 2015-02”), which simplifies consolidation accounting by reducing the number of consolidation models and changing various aspects of current U.S. GAAP, including certain consolidation criteria for a variable interest entity (“VIE”). For legal entities being evaluated for consolidation, the Company must first determine whether the interests that it holds and fees it receives qualify as variable interests in the entity. A variable interest is an investment or other interest that will absorb portions of an entity’s expected losses or receive portions of the entity’s expected residual returns. The Company’s evaluation includes consideration of fees paid to the Company where the Company acts as a decision maker or service provider to the entity being evaluated. If the Company determines that it holds a variable interest in an entity, it evaluates whether that entity is a VIE. VIEs are entities where investors lack sufficient equity at risk for the entity to finance its activities without additional subordinated financial support or where equity investors, as a group, lack one of the following characteristics: (a) the power to direct the activities that most significantly impact the entity’s economic performance, (b) the obligation to absorb the expected losses of the entity, or (c) the right to receive the expected returns of the entity.

The Company then qualitatively assesses whether it is (or is not) the primary beneficiary of a VIE, which is generally defined as the party who has a controlling financial interest in the VIE. Consideration of various factors include, but are not limited to, the Company’s ability to direct the activities that most significantly impact the entity’s economic performance and its obligation to absorb losses from or right to receive benefits of the VIE that could potentially be significant to the VIE. The Company consolidates any VIEs when the Company is determined to be the primary beneficiary of the VIE and the difference between consolidating the VIE and accounting for it using the equity method could be material to the Company’s consolidated financial statements. The Company continually evaluates the need to consolidate these VIEs based on standards set forth in U.S. GAAP as described above.

13

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Reclassification

As described below, the following items previously reported have been reclassified to conform with the current period’s presentation.

The land and construction in progress line item from prior periods has been combined into the land caption in the consolidated balance sheets. The gain on forgiveness of debt previously included in other income, net has been combined into the caption gain on extinguishment and forgiveness of debt, net in the consolidated statements of operations. Additionally, equity in income of unconsolidated joint ventures previously included in other income net, in the consolidated statements of operations has been included in a separate caption entitled equity in income and gain on disposition of unconsolidated entities. Further, the previous gain on investment securities line item has been included in other income, net in the consolidated statements of operations.

Finally, the designated derivatives, fair value adjustments line item from the prior years has been disaggregated within the consolidated statements of other comprehensive loss into the captions unrealized loss on interest rate derivatives and amount of loss reclassified from accumulated other comprehensive loss into net loss as interest expense. These captions were previously included within the notes to consolidated financial statements.

Restricted Cash

The Company had $60.1 million and $59.8 million, respectively, in restricted cash as of March 31, 2016 and December 31, 2015. Restricted cash primarily consists of reserves related to lease expirations, as well as maintenance, structural and debt service reserves. Included in restricted cash at March 31, 2016 was $48.8 million in lender reserves and $11.3 million held in restricted lockbox accounts. Included in restricted cash at December 31, 2015 was $47.9 million in lender reserves and $11.9 million held in restricted lockbox accounts. As part of certain debt agreements, rent from certain of the Company’s tenants is deposited directly into a lockbox account, from which the monthly debt service payments are disbursed to the lender and the excess funds are then disbursed to the Company.

Revenue Recognition – REI

The Company’s revenues, which primarily consist of rental income, include rents that each tenant pays in accordance with the terms of each lease reported on a straight-line basis over the initial non-cancelable term of the lease. When the Company acquires a property, the term of each existing lease is considered to commence as of the acquisition date for the purposes of this calculation. Since many of the leases provide for rental increases at specified intervals, straight-line basis accounting requires the Company to record a receivable, and include in revenues, unbilled rent receivables that the Company will only receive if the tenant makes all rent payments required through the expiration of the initial term of the lease. Straight-line rent receivables are included in rent and tenant receivables and other assets, net, in the consolidated balance sheets. See Note 8 – Rent and Tenant Receivables and Other Assets, Net. Cost recoveries from tenants are included in operating expense reimbursements in the consolidated statements of operations in the period the related costs are incurred. The Company defers the revenue related to lease payments received from tenants in advance of their due dates. As of March 31, 2016 and December 31, 2015, the Company had $67.3 million and $67.2 million, respectively, of deferred rental income, which is included in deferred rent, derivative and other liabilities in the consolidated balance sheets.

The Company continually reviews receivables related to rent and unbilled rent receivables and determines collectability by taking into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. In the event that the collectability of a receivable is uncertain, the Company will record an increase in the allowance for uncollectible accounts in the consolidated balance sheets or record a direct write-off of the receivable in the consolidated statements of operations as a reduction to rental income. As of March 31, 2016 and December 31, 2015, the Company maintained an allowance for uncollectible accounts of $7.9 million and $6.6 million, respectively.

14

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Revenue Recognition – Cole Capital

Revenue consists of securities sales commissions and dealer manager fees, real estate acquisition fees, property management fees, advisory fees, asset management fees and performance fees for services relating to the Cole REITs’ offerings and the investment and management of their respective assets, in accordance with the respective dealer manager and advisory agreements. The Company records revenue related to acquisition fees, securities sales commissions and dealer manager fees upon completion of a transaction and advisory, asset and property management fees as services are performed. The Company also earns property management, asset management and disposition fees from certain joint ventures and other real estate programs. The Company is also reimbursed for certain costs incurred in providing these services. Securities sales commissions and dealer manager reimbursements are recorded as revenue as the expenses are incurred, as long as reimbursement is reasonably assured. The Company, in its sole discretion, may reallow all or a portion of its dealer manager fee to such participating broker-dealers as a marketing and due diligence expense reimbursement, based on factors such as the volume of shares issued by such participating broker-dealers and the amount of marketing support provided by such participating broker-dealers. Refer to Note 17 –Related Party Transactions and Arrangements for further discussion.

Acquisition Related Expenses and Litigation and Other Non-routine Costs

All costs incurred as a result of a business combination are classified as acquisition related expenses or merger and other non-routine transaction related expenses and expensed as incurred. Acquisition related expenses include legal and other transaction related costs incurred in connection with self-originated acquisitions, including purchases of portfolios. In addition, indirect costs, such as internal salaries, that are tracked and documented in a manner that clearly indicates that the activities driving the cost directly relate to activities necessary to complete, or effect, self-originating purchases are classified as acquisition related expenses.

Similar costs incurred in relation to mergers, which are not considered self-originating purchases, and other non-routine transaction related expenses are included in litigation and other non-routine costs, net of insurance recoveries in the consolidated statements of operations. The Company has also incurred legal fees and other costs associated with the Audit Committee Investigation (defined below) and the litigations and investigations resulting therefrom, which are considered non-routine. The Company has directors’ and officers’ insurance and has recovered certain amounts related to such policies.

Litigation and other non-routine transaction related expenses include the following costs (amounts in thousands):

	Three Months Ended March 31,
	2016			2015
Other non-routine transaction related expenses:
Audit Committee Investigation and related matters (1)	$	4,742		$	15,316
Legal fees and expenses (2)	83			475
Other fees and expenses	—			632
Total costs incurred	4,825			16,423
Insurance recoveries	(10,000		)	—
Total	$	(5,175	)	$	16,423

___________________________________

(1) Includes all fees and costs associated with the previously-announced investigation conducted by the audit committee (the “Audit Committee”) of the General Partner’s board of directors (the “Audit Committee Investigation”) and various litigations and investigations prompted by the results of the Audit Committee Investigation, including fees and costs incurred pursuant to the Company’s indemnification obligations.

(2) Includes legal fees and expenses associated with litigation resulting from prior mergers.

15

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Income Taxes

The General Partner currently qualifies and has elected to be taxed as a REIT for U.S. federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code. As a REIT, except as discussed below, the General Partner generally is not subject to federal income tax on taxable income that it distributes to its stockholders so long as it distributes at least 90% of its annual taxable income (computed without regard to the deduction for dividends paid and excluding net capital gains). REITs are subject to a number of other organizational and operational requirements. Even if the General Partner maintains its qualification for taxation as a REIT, it may be subject to certain state and local taxes on its income and property, federal income taxes on certain income and excise taxes on its undistributed income.

The OP is classified as a partnership for U.S. federal income tax purposes. As a partnership, the OP is not a taxable entity for U.S. federal income tax purposes. Instead, each partner in the OP is required to take into account its allocable share of the OP’s income, gains, losses, deductions and credits for each taxable year. However, the OP may be subject to certain state and local taxes on its income and property.

As of March 31, 2016, the OP and the General Partner had no material uncertain income tax positions. The tax years subsequent to and including the fiscal year ended December 31, 2011 remain open to examination by the major taxing jurisdictions to which the OP, the General Partner, American Realty Capital Trust III, Inc. (“ARCT III”), CapLease, Inc. (“CapLease”), American Realty Capital Trust IV, Inc., (“ARCT IV”), Cole Real Estate Investments, Inc. (“Cole”) and Cole Credit Property Trust, Inc. are subject.

Under the LPA, the OP is to conduct business in such a manner as to permit the General Partner at all times to qualify as a REIT.

The Company conducts substantially all of its Cole Capital segment business activities through a TRS. A TRS is a subsidiary of a REIT that is subject to corporate federal, state and local income taxes, as applicable. The Company’s use of a TRS enables it to engage in certain business activities while complying with the REIT qualification requirements and to retain any income generated by these businesses for reinvestment without the requirement to distribute those earnings. The Company conducts all of its business in the United States and Canada and, as a result, it files income tax returns in the U.S. federal jurisdiction, the Canadian federal jurisdiction and various state and local jurisdictions. Certain of the Company’s inter-company transactions that have been eliminated in consolidation for financial accounting purposes are also subject to taxation.

The Company provides for income taxes in accordance with current authoritative accounting and tax guidance. The tax provision or benefit related to significant or unusual items is recognized in the quarter in which those items occur. In addition, the effect of changes in enacted tax laws, rates or tax status is recognized in the quarter in which the change occurs. The accounting estimates used to compute the provision for or benefit from income taxes may change as new events occur, additional information is obtained or the tax environment changes.

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which supersedes the revenue recognition requirements in Revenue Recognition, Accounting Standards Codification (“ASC”) (Topic 605) and requires an entity to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, an amendment to ASU 2014-09, ASU 2015-14, was issued to defer the effective date for all entities by one year. For public business entities, certain not-for-profit entities and certain employee benefit plans, the guidance should be applied to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company is currently evaluating the impact of the new standard on its financial statements.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments(Subtopic 825-10), which requires all equity investments to be measured at fair value with changes in the fair value recognized through net income (other than those accounted for under equity method of accounting or those that result in consolidation of the investee). The amendments in this update also require an entity to present separately in other comprehensive income, the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. In addition, the amendments in this update require separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. The Company is currently evaluating the impact that this new guidance will have on its financial statements.

16

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which will require that a lessee recognize assets and liabilities on the balance sheet for all leases with a lease term of more than 12 months, with the result being the recognition of a right of use asset and a lease liability and the disclosure of key information about the entity's leasing arrangements. ASU 2016-02 retains a distinction between finance leases (i.e. capital leases under current U.S. GAAP) and operating leases. The classification criteria for distinguishing between finance leases and operating leases will be substantially similar to the classification criteria for distinguishing between capital leases and operating leases under current U.S. GAAP. The amendments in ASU 2016-02 are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. A modified retrospective approach is required for existing leases that have not expired upon adoption. The Company is currently evaluating the impact this amendment will have on its consolidated financial statements.

In March of 2016, the FASB issued ASU No. 2016-05, Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships (Topic 815). The amendments in this update clarify that a change in the counterparty to a derivative instrument that has been designated as the hedging instrument does not, in and of itself, require de-designation of that hedging relationship provided that all other hedge accounting criteria continue to be met. These provisions are effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact this amendment will have on its consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvement to Employee Share-Based Payment Accounting, which affects entities that issue share-based payment awards to their employees. The ASU is designed to simplify several aspects of accounting for share-based payment award transactions including the income tax consequences, classification of awards as either equity or liabilities, classification on the statement of cash flows and forfeiture rate calculations. The guidance will be effective for annual reporting periods beginning after December 15, 2016 and interim periods within those fiscal years with early adoption permitted. The Company has elected to early adopt this guidance during the first quarter of 2016, which does not have a material effect on the Company’s consolidated financial statements. In connection with the adoption, the Company has modified the consolidated statement of changes in equity to include the line item cumulative-effect adjustment for equity-based compensation forfeitures, which represents application of the accounting change on a modified retrospective basis.

Note 3 –Segment Reporting

The Company has two reportable segments as it has organized its operations into two segments for management and internal financial reporting purposes, REI and Cole Capital, as further discussed below.

REI – Through its REI segment, the Company owns and actively manages a diversified portfolio of retail, restaurant, office and industrial real estate properties subject to long-term net leases with creditworthy tenants. As of March 31, 2016, the Company owned 4,378 properties comprising 99.0 million square feet of retail and commercial space located in 49 states, the District of Columbia, Puerto Rico and Canada, which includes properties owned through consolidated joint ventures. The rentable space at these properties was 98.6% leased with a weighted-average remaining lease term of 10.4 years. In addition, as of March 31, 2016, the Company owned nine CMBS and nine mortgage notes receivable.

Cole Capital – Through its Cole Capital segment, the Company is responsible for managing the day-to-day affairs of Cole Credit Property Trust IV, Inc. (“CCPT IV”); Cole Real Estate Income Strategy (Daily NAV), Inc. (“INAV”); Cole Office & Industrial REIT (CCIT II), Inc. (“CCIT II”); Cole Credit Property Trust V, Inc. (“CCPT V”); and other real estate offerings in registration (collectively with CCPT IV, INAV and CCIT II, the “Cole REITs”), raising capital for those Cole REITs still in offering, identifying and making acquisitions and investments on the Cole REITs’ behalf and recommending to the respective board of directors of each of the Cole REITs an approach for providing investors with liquidity. Cole Capital serves as the dealer manager and distributes shares of common stock for certain Cole REITs and advises them regarding offerings, manages relationships with participating broker-dealers and financial advisors and provides assistance in connection with compliance matters relating to the offerings. Cole Capital receives compensation and reimbursement for services relating to the Cole REITs’ offerings and the investment, management, financing and disposition of their respective assets, as applicable. Cole Capital also develops new REIT offerings and assists in obtaining regulatory approvals from the SEC, the Financial Industry Regulatory Authority, Inc. and various blue sky jurisdictions for such offerings. See Note 17 –Related Party Transactions and Arrangements for further discussion on the Cole REITs.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

The Company allocates certain operating expenses, such as legal fees, employee related costs and benefits and general overhead expenses between its operating segments. The following tables present a summary of the comparative financial results and total assets for each segment (in thousands):

	Three Months Ended March 31,
	2016			2015
REI segment:
Revenues:
Rental income	$	313,971		$	342,759
Direct financing lease income	569			741
Operating expense reimbursements	23,247			22,974
Total real estate investment revenues	337,787			366,474
Operating expenses:
Acquisition related	217			1,723
Litigation and other non-routine costs, net of insurance recoveries	(5,175		)	16,423
Property operating	34,813			30,999
General and administrative	12,228			15,370
Depreciation and amortization	195,991			210,788
Impairment of real estate	160,517			—
Total operating expenses	398,591			275,303
Operating (loss) income	$	(60,804	)	$	91,171
Other (expense) income:
Interest expense	$	(80,426	)	$	(95,699	)
Gain on extinguishment and forgiveness of debt, net	—			5,302
Other income, net	568			2,841
Equity in income and gain on disposition of unconsolidated entities	10,404			28
Loss on derivative instruments, net	(1,086		)	(1,028		)
Total other expenses, net	(70,540		)	(88,556		)
(Loss) income before taxes and real estate dispositions	(131,344		)	2,615
Gain (loss) on disposition of real estate, net	17,175			(31,368		)
Loss before taxes	(114,169		)	(28,753		)
Provision for income taxes	(1,365		)	(1,854		)
Net loss	$	(115,534	)	$	(30,607	)

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

	Three Months Ended March 31,
	2016			2015
Cole Capital segment:
Revenues:
Offering-related fees and reimbursements	$	12,391		$	3,117
Transaction service fees and reimbursements	2,384			10,260
Management fees and reimbursements	16,458			14,117
Total Cole Capital revenues	31,233			27,494
Operating expenses:
Cole Capital reallowed fees and commissions	8,068			2,031
Acquisition related	25			459
General and administrative	17,172			17,736
Depreciation and amortization	8,317			8,353
Total operating expenses	33,582			28,579
Operating loss	(2,349		)	(1,085		)
Total other income, net	494			1,219
(Loss) income before taxes	(1,855		)	134
Benefit from (provision for) income taxes	1,309			(220		)
Net loss	$	(546	)	$	(86	)
Total Company:
Total revenues	$	369,020		$	393,968
Total operating expenses	$	432,173		$	303,882
Total other expense, net	$	(70,046	)	$	(87,337	)
Net loss	$	(116,080	)	$	(30,693	)

	Total Assets
	March 31, 2016		December 31, 2015
REI segment	$	16,465,057	$	16,966,729
Cole Capital segment	378,555		439,137
Total Company	$	16,843,612	$	17,405,866

Note 4 – Goodwill and Other Intangibles

Goodwill

In connection with prior mergers, the Company recorded goodwill as a result of the merger consideration exceeding the net assets acquired. The goodwill recorded as a result of the merger of Cole with and into a wholly owned subsidiary of the Company (the “Cole Merger”) was allocated between the Company’s two segments, the REI segment and the Cole Capital segment. The REI segment and the Cole Capital segment each comprise one reporting unit.

In the event the Company disposes of a property that constitutes a business under U.S. GAAP, the Company will allocate a portion of the REI segment’s goodwill to that property in determining the gain or loss on the disposal of the property. The amount of goodwill allocated to the property will be based on the relative fair value of the property to the fair value of the REI segment. Future property acquisitions that constitute a business will be integrated into the REI segment and therefore will also be allocated goodwill upon disposition.

The Company evaluates goodwill for impairment annually or more frequently when an event occurs or circumstances change that indicate the carrying value, by reporting unit, may not be recoverable. The analysis for the annual goodwill test is performed during the fourth quarter. The Company tests goodwill for impairment by first comparing the carrying value of net assets to the fair value of each reporting unit. If the fair value is determined to be less than the carrying value or if qualitative factors indicate

19

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

that it is more likely than not that goodwill is impaired, a second step is performed to compute the amount of impairment as the difference between the fair value of goodwill and the carrying value. The Company estimates the fair value of the reporting units using discounted cash flows and relevant competitor multiples. The evaluation of goodwill for potential impairment requires the Company’s management to exercise significant judgment and to make certain assumptions. While the Company believes its assumptions are reasonable, there are no guarantees as to actual results. Changes in assumptions based on actual results may have a material impact on the Company’s financial results.

The fair values of the Cole Capital segment goodwill is dependent upon actual results, including, but not limited to, the timing and amount of aggregate capital raised and deployed on behalf of the Cole REITs, which is influenced by the Company’s ability to reinstate certain selling agreements that were suspended as a result of the Audit Committee Investigation and the resulting restatements. If the Company is unable to reinstate selling agreements or raise and deploy capital as estimated, the fair values of the Cole Capital segment goodwill and intangible assets may be less than the respective carrying value, resulting in an impairment that could have a material effect on a Company’s financial results. In addition, the actual timing of closing an offering or executing a liquidity event on behalf of a Cole REIT or the commencement of operations of newly formed REITs, which are not yet effective, may differ from the Company’s assumptions used.

During the three months ended March 31, 2016 and 2015, management monitored the actual performance of the business segments relative to the fair value assumptions used during the annual goodwill impairment test. For the periods presented, no events or changes in circumstances were identified where management determined it is more likely than not that the fair value of a reporting unit is less than its carrying value.

The following table summarizes the Company’s goodwill activity by segment during the three months ended March 31, 2016 and 2015 (in thousands):

	REI Segment			Cole Capital Segment		Consolidated
Balance as of December 31, 2015	$	1,410,631		$	245,743	$	1,656,374
Goodwill allocated to dispositions and held for sale assets (1)	(13,516		)	—		$	(13,516	)
Balance as of March 31, 2016	$	1,397,115		$	245,743	$	1,642,858

	REI Segment			Cole Capital Segment		Consolidated
Balance as of December 31, 2014	1,509,396			385,398		1,894,794
Goodwill allocated to dispositions and held for sale assets (1)	(23,680		)	—		(23,680		)
Balance as of March 31, 2015	$	1,485,716		$	385,398	$	1,871,114

_______________________________________________

(1) Included in gain (loss) on disposition of real estate, net, in the consolidated statement of operations.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Intangible Assets

The intangible assets primarily consisted of management and advisory contracts that the Company has with certain Cole REITs, which are subject to an estimated useful life of approximately four years.

The Company evaluates intangible assets for impairment when an event occurs or circumstances change that indicate the carrying value may not be recoverable. The Company tests intangible assets for impairment by first comparing the carrying value of the asset group to the undiscounted future cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying value, the Company will adjust the intangible assets to their respective fair values and recognize an impairment loss.

The Company will estimate the fair value of the intangible assets using a discounted cash flow model specific to the applicable Cole REITs. The evaluation of intangible assets for potential impairment requires the Company’s management to exercise significant judgment and to make certain assumptions. While the Company believes its assumptions are reasonable, there are no guarantees as to actual results. Changes in assumptions based on actual results may have a material impact on the Company’s financial results. There were no events or changes in circumstances that indicated that intangible assets were impaired during the three months ended March 31, 2016 or 2015.

The Company recorded $7.5 million of amortization expenses related to the intangible assets for each of the three months ended March 31, 2016 and 2015. The estimated amortization expense is expected to be $18.7 million for the remainder of the year ending December 31, 2016, $16.6 million and $4.0 million for the years ending December 31, 2017 and 2018, respectively, and $3.8 million for the nine months ended September 30, 2019. The intangible assets were $43.3 million and $50.8 million, net of accumulated amortization of $10.9 million and $3.4 million, respectively, as of March 31, 2016 and December 31, 2015.

Intangible Lease Assets and Liabilities

Intangible lease assets and liabilities of the Company consisted of the following as of March 31, 2016 and December 31, 2015(amounts in thousands, except weighted-average useful life):

	Weighted-Average Useful Life	March 31, 2016		December 31, 2015
Intangible lease assets:
In-place leases, net of accumulated amortization of $405,753 and $398,770, respectively	13.5	$	1,381,547	$	1,458,354
Leasing commissions, net of accumulated amortization of $1,137 and $1,035, respectively	9.2	6,060		4,872
Above-market leases, net of accumulated amortization of $51,944 and $47,041, respectively	16.1	299,293		308,306
Total intangible lease assets, net		$	1,686,900	$	1,771,532
Intangible lease liabilities:
Below-market leases, net of accumulated amortization of $42,629 and $38,340, respectively	17.4	$	245,093	$	251,692

The following table provides the projected amortization expense and adjustments to rental income related to the intangible lease assets and liabilities for the next five years as of March 31, 2016 (amounts in thousands):

	April 1, 2016 - December 31, 2016		2017		2018		2019		2020
In-place leases:
Total to be included in amortization expense	$	168,216	$	154,275	$	141,317	$	129,711	$	120,676
Leasing Commissions
Total to be included in amortization expense	$	1,341	$	682	$	496	$	425	$	407
Above-market lease assets:
Total to be deducted from rental income	$	25,672	$	25,309	$	24,756	$	22,801	$	22,334
Below-market lease liabilities:
Total to be included in rental income	$	23,115	$	20,453	$	20,126	$	19,388	$	18,196

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Note 5 –Real Estate Investments

The Company acquired controlling financial interests in one commercial property for a purchase price of $20.0 million during the three months ended March 31, 2016. During the three months ended March 31, 2015, the Company acquired controlling interests in 10 commercial properties, including six land parcels, for an aggregate purchase price of $7.6 million.

The following table presents the allocation of the fair values of the assets acquired and liabilities assumed during the periods presented (in thousands):

	Three Months Ended March 31,
	2016		2015
Real estate investments, at cost:
Land	$	4,215	$	1,594
Buildings, fixtures and improvements	14,555		5,617
Total tangible assets	18,770		7,211
Acquired intangible assets:
In-place leases	1,182		416
Total purchase price of assets acquired	$	19,952	$	7,627

Future Lease Payments

The following table presents future minimum base rent payments due to the Company over the next five years and thereafter. These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items (in thousands):

	Future Minimum Operating Lease Base Rent Payments		Future Minimum Direct Financing Lease Payments (1)
April 1, 2016 - December 31, 2016	$	882,655	$	3,338
2017	1,162,408		4,036
2018	1,131,580		3,016
2019	1,090,919		2,397
2020	1,050,467		2,023
Thereafter	7,870,665		5,893
Total	$	13,188,694	$	20,703

____________________________________

(1) 36 properties are subject to direct financing leases and, therefore, revenue is recognized as direct financing lease income on the discounted cash flows of the lease payments. Amounts reflected are the minimum base rental cash payments due to the Company under the lease agreements on these respective properties.

Investment in Direct Financing Leases, Net

The components of the Company’s net investment in direct financing leases as of March 31, 2016 and December 31, 2015 are as follows (in thousands):

	March 31, 2016			December 31, 2015
Future minimum lease payments receivable	$	20,703		$	21,993
Unguaranteed residual value of property	31,562			31,562
Unearned income	(6,654		)	(7,243		)
Net investment in direct financing leases	$	45,611		$	46,312

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Development Activities

As of March 31, 2016 and December 31, 2015, the Company had $15.9 million and $20.0 million, respectively, of land and construction in progress. The Company has contracted with a developer to complete a portfolio of build-to-suit development projects, of which 35 have been completed as of March 31, 2016, for an aggregate cost of $50.6 million to date and the remaining two projects are expected to be completed within the next three months. Pursuant to the agreement between the Company and the developer, the Company will acquire the respective land parcel for each development and subsequently pay a fixed construction draw until the project is complete. In addition, during the three months ended March 31, 2016, one build-to-suit project was completed and placed into service for an aggregate cost of $1.4 million. During the three months ended March 31, 2016 and 2015, the Company capitalized $0.1 million and $0.3 million, respectively, of interest expense associated with development projects.The Company is also in the process of completing four other expansion projects, which are expected to increase its revenue as a result of the additional square footage and improvement of the quality of the properties. Below is a summary of the construction commitments as of March 31, 2016 (dollar amounts in thousands):

Development projects in progress	6
Investment to date	$	12,729
Estimated cost to complete (1)	4,563
Total Investment (2)	$	17,292

_______________________________________________

(1) The Company is contractually committed to fund a developer $1.4 million to complete the remaining two build-to-suit developments.

(2) Excludes tenant improvement costs incurred in accordance with existing leases. As of March 31, 2016, $3.2 million of tenant improvement costs were included in buildings, fixtures and improvements in the consolidated financial statements.

Property Dispositions and Held for Sale Assets

During the three months ended March 31, 2016, the Company disposed of 58 properties for an aggregate gross sales price of $193.7 million, of which our share was $193.1 million after the profit participation payment related to the disposition of one Red Lobster. The dispositions resulted in proceeds of $133.8 million after a debt assumption of $55.0 million and closing costs. The Company recorded a gain of $18.8 million related to the sales, which included $11.3 million of goodwill allocated in the cost basis of such properties, which is included in gain (loss) on disposition of real estate, net in the accompanying consolidated statements of operations. During the three months ended March 31, 2015, the Company disposed of 11 properties for an aggregate gross sales price of $271.8 million, resulting in proceeds of $245.5 million after debt assumptions and closing costs. The Company recorded a loss of $31.4 million, including $23.7 million of goodwill allocation related to the sales. During the three months ended March 31, 2015, the Company also had one property that was foreclosed upon with a prior net book value of $38.2 million. The Company has no continuing involvement with these properties. The dispositions were not classified as discontinued operations for any period presented.

During the three months ended March 31, 2016, the Company also disposed of one property owned by an unconsolidated joint venture for a gross sales price of $113.5 million, of which our share was $102.1 million based on our ownership interest in the joint venture, resulting in proceeds of $42.3 million after debt repayments of $57.0 million and closing costs. The Company recorded a gain of $10.2 million related to the sale, which is included in equity in income and gain on disposition of unconsolidated entities in the accompanying consolidated statements of operations.

As of March 31, 2016, there were 19 properties classified as held for sale, which are expected to be sold in the next 12 months as part of the Company’s portfolio management strategy. To reflect the properties’ fair values less cost to sell, the Company recorded a loss of $1.7 million, which included $2.2 million of goodwill allocated in the cost basis of such properties, for the three months ended March 31, 2016. The loss on properties held for sale is included in gain (loss) on disposition of real estate, net in the accompanying consolidated statements of operations. As of December 31, 2015, there were 17 properties classified as held for sale, all of which were sold during the three months ended March 31, 2016.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Impairment of Real Estate Investments

The Company performs quarterly impairment review procedures, primarily through continuous monitoring of events and changes in circumstances that could indicate the carrying value of its real estate assets may not be recoverable. Impairment indicators that the Company considers include, but are not limited to, decrease in net operating income, bankruptcy or other credit concerns of a property’s major tenant or tenants, such as history of late payments, rental concessions and other factors, as well as significant decreases in a property’s revenues due to lease terminations, vacancies, co-tenancy clauses or reduced lease rates.

When impairment indicators are identified or if a property is considered to have a more likely than not probability of being disposed of within the next 12 to 24 months, the Company assesses the recoverability of the assets by determining whether the carrying value of the assets will be recovered through the undiscounted future cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying value, the Company will adjust the real estate assets to their respective fair values and recognize an impairment loss. Generally, fair value is determined using a discounted cash flow analysis and recent comparable sales transactions.

During the three months ended March 31, 2016, management identified certain properties for potential sale as part of its portfolio management strategy to reduce exposure to office properties. Additionally, a tenant of 59 restaurants filed for bankruptcy during the three months ended March 31, 2016. As part of the Company’s quarterly impairment review procedures and considering the factors mentioned above, real estate assets with carrying values totaling $623.0 million were deemed to be impaired and their carrying values were reduced to their estimated fair values of $462.5 million resulting in impairment charges of $160.5 million during the three months ended March 31, 2016. The Company identified certain properties during the three months ended March 31, 2015 with impairment indicators, however, the undiscounted future cash flows expected as a result of the use and eventual disposition of the real estate and related assets was in excess of the carrying amounts and, as such, no impairment charges were recorded.

Consolidated Joint Ventures

The Company had interests in two joint ventures that owned two properties as of each of March 31, 2016 and December 31, 2015 (the “Consolidated Joint Ventures”). As of March 31, 2016 and December 31, 2015, the Consolidated Joint Ventures had total assets of $58.0 million and $58.5 million, of which $54.9 million and $55.2 million, respectively, were real estate investments, net of accumulated depreciation and amortization. One property secured a mortgage note payable of $8.4 million, which is non-recourse to the Company. The Company has the ability to control operating and financial policies of the Consolidated Joint Venture. There are restrictions on the use of these assets as the Company would generally be required to obtain the respective partner's (“the Partner”) approval in accordance with the joint venture agreement for any major transactions. The Company and the Partner are subject to the provisions of the joint venture agreement, which includes provisions for when additional contributions may be required to fund certain cash shortfalls.

The Partners’ share of the Consolidated Joint Ventures’ loss of $39,000 and income of $0.2 million for the three months ended March 31, 2016 and March 31, 2015, respectively, is included in net loss attributable to non-controlling interests in the consolidated statements of operations.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Unconsolidated Joint Ventures

Investment in unconsolidated joint ventures consisted of the Company’s interest in two joint ventures that owned two properties and the Company’s interest in three joint ventures that owned three properties as of March 31, 2016 and December 31, 2015, respectively, which were comprised of 0.5 million square feet of retail space and 0.9 million square feet of retail and office space, respectively, (the “Unconsolidated Joint Ventures”). As of March 31, 2016 and December 31, 2015, the Company owned aggregate equity investments of $19.6 million and $52.8 million, respectively, in the Unconsolidated Joint Ventures. The Company accounts for the Unconsolidated Joint Ventures using the equity method of accounting as the Company has the ability to exercise significant influence, but not control, over operating and financial policies of these investments. The equity method of accounting requires the investment to be initially recorded at cost and subsequently adjusted for the Company’s share of equity in the joint ventures’ earnings and distributions. As of March 31, 2016, the Company’s maximum exposure to risk is $19.6 million, the carrying value of our investment, which is presented in the investment in unconsolidated entities line item in the consolidated balance sheets. The Unconsolidated Joint Ventures had total debt outstanding of $46.3 million as of March 31, 2016, none of which is recourse to the Company, as discussed in Note 10 –Debt. The Company and the respective Unconsolidated Joint Venture partner are subject to the provisions of the joint venture agreement which include provisions for when additional contributions may be required to fund certain cash shortfalls.

The Company records its proportionate share of net income from the Unconsolidated Joint Ventures in equity in income and gain on disposition of unconsolidated entities in the consolidated statements of operations. During the three months ended March 31, 2016 and 2015, the Company recognized $0.3 million and $0.1 million, respectively, of net income from the Unconsolidated Joint Ventures.

The following is a summary of the Company’s percentage ownership and carrying amount related to each of the Unconsolidated Joint Ventures as of March 31, 2016 (dollar amounts in thousands):

Name of Joint Venture	Partner	Ownership % (1)	Carrying Amount of Investment (2)
Cole/Mosaic JV South Elgin IL, LLC	Affiliate of Mosaic Properties and Development, LLC	50%	$	6,452
Cole/Faison JV Bethlehem GA, LLC	Faison-Winder Investors, LLC	90%	13,185
			$	19,637

_______________________________________________

(1) The Company’s ownership interest in this table reflects its legal ownership interest. Legal ownership may, at times, not equal the Company’s economic interest in the listed properties because of various provisions in certain joint venture agreements regarding distributions of cash flow based on capital account balances, allocations of profits and losses and payments of preferred returns. As a result, the Company’s actual economic interest (as distinct from its legal ownership interest) in certain of the properties could fluctuate from time to time and may not wholly align with its legal ownership interests.

(2) The total carrying amount of the investments is greater than the underlying equity in net assets by $6.7 million. This difference relates to a purchase price allocation of goodwill and a step up in fair value of the investment assets acquired in connection with the Cole Merger. The step up in fair value was allocated to the individual investment assets and is being amortized in accordance with the Company’s depreciation policy.

Tenant Concentration

As of March 31, 2016, there were no tenants exceeding 10% of the Company’s consolidated annualized rental income. Annualized rental income is rental revenue under the Company’s leases on operating properties reflecting straight-line rent adjustments associated with contractual rent increases in the leases as required by U.S. GAAP, which includes the effect of any tenant concessions, such as free rent, and excludes any contingent rent, such as percentage rent.

Geographic Concentration

As of March 31, 2016, properties located in Texas represented 13.2% of the Company’s consolidated annualized rental income. There were no other geographic concentrations exceeding 10% of the Company’s consolidated annualized rental income as of March 31, 2016.

Industry Concentration

As of March 31, 2016, tenants in the restaurant - casual dining and manufacturing industries accounted for 16.6% and 10.1% of the Company’s consolidated annualized rental income, respectively. There were no other industry concentrations exceeding 10% of the Company’s consolidated annualized rental income as of March 31, 2016.

25

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Note 6 –Investment Securities, at Fair Value

Investment securities are considered available-for-sale and, therefore, increases or decreases in the fair value of these investments are recorded in accumulated other comprehensive income (loss) as a component of equity in the consolidated balance sheets unless the securities are considered to be other-than-temporarily impaired at which time the losses are reclassified to expense.

The following tables detail the unrealized gains and losses on investment securities as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
CMBS	$	48,934	$	1,146	$	(1,918	)	$	48,162

	December 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
CMBS	$	52,115	$	2,169	$	(980	)	$	53,304

As of March 31, 2016 and December 31, 2015, the Company owned nine and ten CMBS, respectively, with an estimated aggregate fair value of $48.2 million and $53.3 million, respectively. During the three months ended March 31, 2016, one CMBS with a carrying value of less than $0.1 million at December 31, 2015, was paid in full prior to its maturity. The Company generally receives monthly payments of principal and interest on the CMBS. As of March 31, 2016, the Company earned interest on the CMBS at rates ranging between 5.88% and 8.95%. As of March 31, 2016, the fair value of five CMBS were below their amortized cost. In estimating other-than-temporary impairment losses, management considers a variety of factors, including: (i) whether the Company has the intent to sell the impaired security, (ii) whether the Company expects to hold the investment for a period of time sufficient to allow for anticipated recovery in fair value, and (iii) whether the company expects to recover the entire amortized cost basis of the security. The Company believes that none of the unrealized losses on investment securities are other-than-temporary as management expects the Company will fully recover the entire amortized cost basis of all securities. As of March 31, 2016, the Company had no other-than-temporary impairment losses.

The scheduled maturity of the Company’s CMBS as of March 31, 2016 is as follows (in thousands):

	March 31, 2016
	Amortized Cost		Fair Value
Due within one year	$	—	$	—
Due after one year through five years	21,656		22,316
Due after five years through 10 years	12,508		10,664
Due after 10 years	14,770		15,182
Total	$	48,934	$	48,162

Note 7 – Mortgage Notes Receivable

As of March 31, 2016, the Company owned nine mortgage notes receivable with a weighted-average interest rate of 6.3% and weighted-average years to maturity of 13.7 years. During the three months ended March 31, 2016, one note with a carrying value of $0.4 million at December 31, 2015, reached maturity and was paid in full. The following table details the mortgage notes receivable as of March 31, 2016 (dollar amounts in thousands):

Outstanding Balance		Carrying Value		Interest Rate Range				Maturity Date Range
$	25,470	$	23,559	5.9	%	–	7.2%	May 2020	–	January 2033

26

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

The Company’s mortgage notes receivable are comprised primarily of fully-amortizing or nearly fully-amortizing first mortgage loans. The Company has one mortgage note receivable where the Company does not receive monthly payments of principal and interest but rather the interest is capitalized into the outstanding balance that is due at maturity. The mortgage notes receivable are primarily on commercial real estate, each leased to a single tenant. Therefore, the Company’s monitoring of the credit quality of its mortgage notes receivable is focused primarily on an analysis of the tenant, including review of tenant quality and ratings, trends in the tenant’s industry and general economic conditions and an analysis of measures of collateral coverage, such as an estimate of the loan-to-value ratio (principal amount outstanding divided by the estimated value of the property) and its remaining term until maturity.

The following table summarizes the scheduled aggregate principal payments due to the Company on the mortgage notes receivable subsequent to March 31, 2016 (in thousands):

	Outstanding Balance
Due within one year	$	1,024
Due after one year through five years	5,344
Due after five years through 10 years	6,725
Due after 10 years(1)	16,298
Total	$	29,391

____________________________________

(1) Includes additional$3.9 million of interest that will be capitalized into the outstanding balance of the mortgage note receivable subsequent toMarch 31, 2016.

Note 8 – Rent and Tenant Receivables and Other Assets, Net

Rent and tenant receivables and other assets, net consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016		December 31, 2015
Accounts receivable, net (1)	$	42,574	$	44,798
Straight-line rent receivable	175,686		161,079
Deferred costs relating to revolving credit facility, net (2)	23,499		26,110
Prepaid expenses	13,852		9,773
Leasehold improvements, property and equipment, net (3)	17,889		18,180
Restricted escrow deposits	2,989		1,190
Deferred tax asset and tax receivable	21,335		25,287
Program development costs, net (4)	13,578		12,855
Interest rate swap assets, at fair value	—		1,892
Other assets	2,501		2,473
Total	$	313,903	$	303,637

___________________________________

(1) Allowance for doubtful accounts was $7.9 million and $6.6 million as of March 31, 2016 and December 31, 2015, respectively.

(2) Amortization expense for deferred costs related to the revolving credit facility totaled $2.6 million and $2.7 million for the three months ended March 31, 2016 and 2015, respectively. Accumulated amortization for deferred costs related to the revolving credit facility were $22.0 million and $19.4 million as of March 31, 2016 and December 31, 2015, respectively.

(3) Amortization expense for leasehold improvements totaled $0.3 million and $0.4 million for the three months ended March 31, 2016 and 2015, respectively. Accumulated amortization was $2.9 million and $2.6 million as of March 31, 2016 and December 31, 2015, respectively. Depreciation expense for property and equipment totaled $0.5 million for each of the three months ended March 31, 2016 and 2015, respectively. Accumulated depreciation was $4.2 million and $3.7 million as of March 31, 2016 and December 31, 2015, respectively.

(4) As of March 31, 2016 and December 31, 2015, the Company had reserves of $37.8 million and $34.8 million, respectively, relating to the program development costs.

27

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Note 9 – Fair Value Measures

The Company determines fair value based on quoted prices when available or through the use of alternative approaches, such as discounting the expected cash flows using market interest rates commensurate with the credit quality and duration of the investment. U.S. GAAP guidance defines three levels of inputs that may be used to measure fair value:

Level 1 – Quoted prices in active markets for identical assets and liabilities that the reporting entity has the ability to access at the measurement date.

Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability.

Level 3 – Unobservable inputs reflect the entity’s own assumptions about the assumptions that market participants would use in the pricing of the asset or liability and are consequently not based on market activity, but rather through particular valuation techniques.

The determination of where an asset or liability falls in the hierarchy requires significant judgment and considers factors specific to the asset or liability. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. Changes in the type of inputs may result in a reclassification for certain assets. There were no transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy during the three months ended March 31, 2016. The Company expects that changes in classifications between levels will be infrequent.

Items Measured at Fair Value on a Recurring Basis

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis, based on market rates of the Company’s positions and other observable interest rates as discussed in Note 6 –Investment Securities, at Fair Value andNote 11 –Derivatives and Hedging Activities, as of March 31, 2016 and December 31, 2015, aggregated by the level in the fair value hierarchy within which those instruments fall (in thousands):

	Level 1		Level 2			Level 3		Balance as of March 31, 2016
Assets:
CMBS	$	—	$	—		$	48,162	$	48,162
Liabilities:
Derivative liabilities	$	—	$	(13,800	)	$	—	$	(13,800	)
	Level 1		Level 2			Level 3		Balance as of December 31, 2015
Assets:
CMBS	$	—	$	—		$	53,304	$	53,304
Derivative assets	—		1,892			—		1,892
Total assets	$	—	$	1,892		$	53,304	$	55,196
Liabilities:
Derivative liabilities	$	—	$	(6,922	)	$	—	$	(6,922	)

CMBS – The Company’s CMBS are carried at fair value and are valued using Level 3 inputs. The Company used estimated non-binding quoted market prices from the trading desks of financial institutions that are dealers in such securities for similar CMBS tranches that actively participate in the CMBS market. Broker quotes are only indicative of fair value and may not necessarily represent what the Company would receive in an actual trade for the applicable instrument. Management determines that the prices are representative of fair value through its knowledge of and experience in the market. The significant unobservable input used in valuing the CMBS is the discount rate or market yield used to discount the estimated future cash flows expected to be received from the underlying investment, which include both future principal and interest payments. Significant increases or decreases in the discount rate or market yield would result in a decrease or increase in the fair value measurement. The following risks are included in the consideration and selection of discount rates or market yields: risk of default, rating of the investment and comparable company investments.

28

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Derivative Assets and Liabilities –The Company’s derivative financial instruments relate to interest rate swaps, discussed in Note 11 –Derivatives and Hedging Activities. The valuation of derivative instruments is determined using a discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, as well as observable market-based inputs, including interest rate curves and implied volatilities. In addition, credit valuation adjustments are incorporated into the fair values to account for the Company’s potential nonperformance risk and the performance risk of the counterparties.

Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with those derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties. However, as of March 31, 2016, the Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives. As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy.

The fair value of short-term financial instruments such as cash and cash equivalents, restricted cash, due to affiliates and accounts payable approximate their carrying value in the accompanying consolidated balance sheets due to their short-term nature and are classified as Level 1 under the fair value hierarchy.

The following are reconciliations of the changes in assets and liabilities with Level 3 inputs in the fair value hierarchy for the three months ended March 31, 2016 and 2015 (in thousands):

	CMBS
Beginning balance, December 31, 2015	$	53,304
Total gains and losses:
Unrealized loss included in other comprehensive income, net	(1,961		)
Purchases, issuances, settlements and amortization:
Principal payments received	(3,217		)
Amortization included in net income	36
Ending Balance, March 31, 2016	$	48,162

	CMBS
Beginning balance, December 31, 2014	$	58,646
Total gains and losses:
Unrealized gain included in other comprehensive income, net	796
Purchases, issuances, settlements and amortization:
Principal payments received	(2,949		)
Ending Balance, March 31, 2015	$	56,493

29

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

The fair values of the Company’s financial instruments that are not reported at fair value in the consolidated balance sheets are reported below (dollar amounts in thousands):

	Level	Carrying Amount at March 31, 2016		Fair Value at March 31, 2016		Carrying Amount at December 31, 2015		Fair Value at December 31, 2015
Assets:
Mortgage notes receivable	3	$	23,559	$	32,008	$	24,238	$	31,842
Liabilities (1):
Mortgage notes payable and other debt, net	2	$	3,049,340	$	3,131,489	$	3,133,005	$	3,240,153
Corporate bonds, net	2	2,547,452		2,578,973		2,547,255		2,580,786
Convertible debt, net	2	983,422		1,014,744		982,217		1,007,042
Credit facilities	2	1,280,000		1,282,200		1,460,000		1,536,264
Total liabilities		$	7,860,214	$	8,007,406	$	8,122,477	$	8,364,245

_______________________________________________

(1) Current and prior period liabilities’ carrying and fair values exclude net deferred financing costs.

Mortgage notes receivable – The fair value of the Company’s fixed-rate loan portfolio is estimated with a discounted cash flow analysis, utilizing scheduled cash flows and discount rates estimated by management to approximate market interest rates.

Debt – The fair value is estimated by an independent third party using a discounted cash flow analysis, based on management’s estimates of observable market interest rates.

Items Measured at Fair Value on a Non-Recurring Basis (Including Impairment Charges)

Certain financial and nonfinancial assets and liabilities are measured at fair value on a nonrecurring basis and are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment.

Real Estate Assets

As discussed in Note 5 –Real Estate Investments, during the three months ended March 31, 2016, real estate assets related to 125 properties were deemed to be impaired and their carrying values were reduced to their estimated fair value of $462.5 million, resulting in impairment charges of $160.5 million. During the three months ended March 31, 2015, no impairment charges were recorded. The Company estimates fair values using Level 3 inputs and using a combined income and market approach, specifically using discounted cash flow analysis and recent comparable sales transactions. The evaluation of real estate assets for potential impairment requires the Company’s management to exercise significant judgment and to make certain key assumptions, including, but not limited to, the following: (1) capitalization rate; (2) discount rates; (3) number of years property will be held; (4) property operating expenses; and (5) re-leasing assumptions including number of months to re-lease, market rental income and required tenant improvements. There are inherent uncertainties in making these estimates such as market conditions and performance and sustainability of the Company’s tenants. For our impairment tests for the real estate assets during the three months ended March 31, 2016, we used a range of discount rates from of 7.5% to 9.0% with a weighted-average rate of 8.1% and capitalization rates from 7.0% to 12.5% with a weighted-average rate of 7.8%.

The following table presents the impairment charges by asset class recorded during the three months ended March 31, 2016 (dollar amounts in thousands):

	Three Months Ended March 31,
	2016
Properties impaired	125
Asset classes impaired:
Investment in real estate assets, net	$	160,721
Below-market lease liabilities, net	(204		)
Total impairment loss	$	160,517

Goodwill and Intangible Assets

30

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

During the three months ended March 31, 2016 or 2015, no events or changes in circumstances were identified where management determined it is more likely than not that the fair value of a reporting unit is less than its carrying value. As such, we did not have any non-recurring fair value measurements related to goodwill and intangible assets during these periods.

Note 10 –Debt

As of March 31, 2016, the Company had $7.8 billion of debt outstanding, including net premiums and net deferred financing costs, with a weighted-average years to maturity of 3.6 years and a weighted-average interest rate of 3.79%. The following table summarizes the carrying value of debt as of March 31, 2016 and December 31, 2015, and the debt activity for the three months ended March 31, 2016 (in thousands):

					Three Months Ended March 31, 2016
		Balance as of December 31, 2015			Debt Issuances		Repayments, Extinguishment and Assumptions			Accretion and (Amortization)			Balance as of March 31, 2016
Mortgage notes payable:
	Outstanding balance	$	3,039,882		$	206	$	(72,785	)	$	—		$	2,967,303
	Net premiums (1)	59,402			—		(1,096		)	(5,777		)	52,529
	Deferred costs	(21,020		)	—		329			1,017			(19,674		)
Other debt:
	Outstanding balance	33,463			—		(4,163		)	—			29,300
	Premium (1)	258			—		—			(50		)	208
Mortgages and other debt, net		3,111,985			206		(77,715		)	(4,810		)	3,029,666
Corporate bonds:
	Outstanding balance	2,550,000			—		—			—			2,550,000
	Discount (2)	(2,745		)	—		—			197			(2,548		)
	Deferred costs	(10,922		)	—		—			1,169			(9,753		)
Corporate bonds, net		2,536,333			—		—			1,366			2,537,699
Convertible debt:
	Outstanding balance	1,000,000			—		—			—			1,000,000
	Discount (2)	(17,779		)	—		—			1,201			(16,578		)
	Deferred costs	(19,327		)	—		—			1,374			(17,953		)
Convertible debt, net		962,894			—		—			2,575			965,469
Credit facility:
	Outstanding balance	1,460,000			203,000		(383,000		)	—			1,280,000
	Deferred costs (3)	(11,410		)	—		—			1,141			(10,269		)
Credit facility, net		1,448,590			203,000		(383,000		)	1,141			1,269,731
Total debt		$	8,059,802		$	203,206	$	(460,715	)	$	272		$	7,802,565

____________________________________

(1) Net premiums on mortgage notes payable and other debt were recorded upon the assumption of the respective debt instruments in relation to the various mergers and acquisitions. Amortization of these net premiums is recorded as a reduction to interest expense over the remaining term of the respective debt instruments using the effective-interest method.

(2) Discounts on the corporate bonds and convertible debt were recorded based upon the fair value of the respective debt instruments as of the respective issuance dates. Amortization of these discounts is recorded as an increase to interest expense over the remaining term of the respective debt instruments using the effective-interest method.

(3) Deferred costs relate to the term portion of the credit facility.

31

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Mortgage Notes Payable

The Company’s mortgage notes payable consisted of the following as of March 31, 2016 (dollar amounts in thousands):

	Encumbered Properties	Gross Carrying Value of Collateralized Properties (1)		Outstanding Balance		Weighted-Average Interest Rate (2)		Weighted-Average Years to Maturity
Fixed-rate debt (3)	651	$	5,533,845	$	2,958,859	5.10	%	4.9
Variable-rate debt	1	24,797		8,444		3.39	%	0.4
Total (4)	652	$	5,558,642	$	2,967,303	5.09	%	4.9

____________________________________

(1) Gross carrying value is gross real estate assets, including investment in direct financing leases, net of gross real estate liabilities.

(2) Weighted-average interest rate for variable-rate debt represents the interest rate in effect as of March 31, 2016.

(3) Includes $247.9 million of variable-rate debt fixed by way of interest rate swap arrangements. 

(4) The table above does not include loan amounts associated with the Unconsolidated Joint Ventures of $46.3 million, none of which is recourse to the Company. These loans represent secured fixed and variable rates ranging from 2.84% to 5.20% and maturities ranging from October 2016 to July 2021, with a weighted-average interest rate of 3.88% and a weighted-average years to maturity of 2.6 years as of March 31, 2016.

The Company’s mortgage loan agreements generally restrict corporate guarantees and require the maintenance of financial covenants, including maintenance of certain financial ratios (such as specified debt to equity and debt service coverage ratios). The mortgage loan agreements contain no dividend restrictions except in the event of default or when a distribution would drive liquidity below the applicable thresholds. At March 31, 2016, the Company believes it was in compliance with the debt covenants under the mortgage loan agreements, except for a loan in default that is described below, and had no restrictions on the payment of dividends. The default on the loan did not result in a cross default on our other indebtedness.

During the three months ended March 31, 2016 and 2015, an aggregate of $55.0 million and $72.3 million, respectively, of mortgage notes payable were repaid prior to maturity or assumed by the buyer in a property disposition. During the three months ended March 31, 2015, $0.4 million was recorded in relation to the write-off of deferred financing costs and net premiums related to mortgage notes payable. During the three months ended March 31, 2016, no such write-off was recorded relating to the early repayment of debt. These costs are included in gain on extinguishment and forgiveness of debt, net in the accompanying consolidated statements of operations. The mortgage notes payable repaid during the three months ended March 31, 2016 had a weighted-average interest rate of 4.41% and a weighted-average remaining term of 2.9 years at the time of prepayment.

On January 13, 2015, a substantially vacant office building in Bethesda, Maryland was foreclosed upon after the Company elected to stop making debt service payments on the related non-recourse loan with an outstanding balance of $53.8 million as of December 31, 2014. As a result of the foreclosure, the Company forfeited its right to the property and was relieved of all obligations on the non-recourse loan. During the three months ended March 31, 2015, the Company recorded a gain on the forgiveness of debt of $4.9 million, which is included in gain on extinguishment and forgiveness of debt, net in the accompanying consolidated statements of operations.

On March 6, 2015, the Company received a notice of default from the lender of a non-recourse loan, which had an outstanding balance of $38.1 million as of March 31, 2016, due to the Company’s election not to make a reserve payment required per the loan agreement. Due to the default, the Company is currently accruing interest at the default rate of interest of 10.68% per annum. The Company is engaged with the servicer to complete foreclosure proceedings.

The following table summarizes the scheduled aggregate principal repayments due on mortgage notes subsequent to March 31, 2016 (in thousands):

	Total
April 1, 2016 - December 31, 2016 (1)	$	198,991
2017	412,546
2018	211,026
2019	231,461
2020	284,197
Thereafter	1,629,082
Total	$	2,967,303

____________________________________

(1) Includes $38.1 million of mortgage notes in connection with the default of a non-recourse loan discussed above.

32

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Other Debt

As of March 31, 2016, the Company had a secured term loan from KBC Bank, N.V. with an outstanding principal balance of $29.3 million and remaining unamortized premium of $0.2 million (the “KBC Loan”). The interest coupon on the KBC Loan is fixed at 5.81% annually until its maturity in January 2018. The KBC Loan is non-recourse to the Company, subject to limited non-recourse exceptions. The KBC Loan provides for monthly payments of both principal and interest. The scheduled principal repayments subsequent to March 31, 2016 are $8.3 million, $7.7 million and $13.3 million for the years ended December 31, 2016, 2017 and 2018, respectively.

The KBC Loan is secured by various investment assets held by the Company. The following table is a summary of the outstanding balance and carrying value of the collateral by asset type as of March 31, 2016 (in thousands):

	Outstanding Balance		Collateral Carrying Value
Mortgage notes receivable	$	8,095	$	19,950
Intercompany mortgage loans	2,264		5,462
CMBS	18,941		35,921
	$	29,300	$	61,333

Corporate Bonds

As of March 31, 2016, the OP had $2.55 billion aggregate principal amount of senior unsecured notes outstanding comprised of 2.00% senior notes due 2017 (the “2017 Senior Notes”), 3.00% senior notes due 2019 (the “2019 Senior Notes”) and 4.60% senior notes due 2024 (the “2024 Senior Notes” and, together with the 2017 Senior Notes and the 2019 Senior Notes, (the “Senior Notes”). The following table presents the three senior notes with their respective terms (dollar amounts in thousands):

	Outstanding Balance		Interest Rate		Maturity Date
2017 Senior Notes	$	1,300,000	2.0	%	February 6, 2017
2019 Senior Notes	750,000		3.0	%	February 6, 2019
2024 Senior Notes	500,000		4.6	%	February 6, 2024
Total balance and weighted-average interest rate	$	2,550,000	2.8	%

The Senior Notes are guaranteed by the General Partner. The OP may redeem all or a part of any series of the Senior Notes at any time, at its option, for the redemption prices set forth in the indenture governing the Senior Notes. With respect to the 2019 Senior Notes and the 2024 Senior Notes, if such Senior Notes are redeemed on or after January 6, 2019 with respect to the 2019 Senior Notes, or November 6, 2023 with respect to the 2024 Senior Notes, the redemption price will equal 100% of the principal amount of the Senior Notes of the applicable series to be redeemed, plus accrued and unpaid interest on the amount being redeemed to, but excluding, the applicable redemption date. The Senior Notes are registered under the Securities Act of 1933, as amended, and are freely transferable. The Company believes it was in compliance with the covenants pursuant to the indenture governing the Senior Notes as of March 31, 2016.

Convertible Debt

As of March 31, 2016, the OP had two tranches of Convertible Notes with an outstanding aggregate balance of $1.0 billion, comprised of the 2018 Convertible Notes and 2020 Convertible Notes. The Convertible Notes are identical to the General Partner’s registered issuance of the same amount of notes to various purchasers in a public offering. The following table presents each of the 2018 Convertible Notes and the 2020 Convertible Notes listed below with their respective terms (dollar amounts in thousands):

	Outstanding Balance (1)		Interest Rate		Conversion Rate (2)	Maturity Date
2018 Convertible Notes	$	597,500	3.00	%	60.5997	August 1, 2018
2020 Convertible Notes	402,500		3.75	%	66.7249	December 15, 2020
Total balance and weighted-average interest rate	$	1,000,000	3.30	%

____________________________________

(1) Excludes the carrying value of the conversion options recorded within additional paid-in capital of $28.6 million and the unamortized discount of $16.6 million as of March 31, 2016. The discount will be amortized over the remaining term of 3.3 years.

(2) Conversion rate represents the amount of the General Partner OP Units per $1,000 principal amount of Convertible Notes converted as of March 31, 2016, as adjusted in accordance with the applicable indentures as a result of cash dividend payments.

33

VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

In connection with any permissible conversion election made by the holders of the identical convertible notes issued by the General Partner, the General Partner may elect to convert the 2018 Convertible Notes into cash, General Partner OP Units or a combination thereof, in limited circumstances prior to February 1, 2018 and may convert the 2018 Convertible Notes at any time into such consideration on or after February 1, 2018. Additionally, the General Partner may elect to convert the 2020 Convertible Notes into cash, General Partner OP Units or a combination thereof, in limited circumstances prior to June 15, 2020, and may convert the 2020 Convertible Notes at any time into such consideration on or after June 15, 2020. The Company believes it was in compliance with the covenants pursuant to the indenture governing the Convertible Notes as of March 31, 2016.

Credit Facility

The General Partner, as guarantor, and the OP, as borrower, are parties to an unsecured credit facility (the “Credit Facility”) pursuant to a credit agreement, dated as of June 30, 2014, as amended, with Wells Fargo, National Association (“Wells Fargo”), as administrative agent and other lenders party thereto (the “Credit Agreement”).

On July 31, 2015, the General Partner and the OP entered into the Second Amendment to the Credit Agreement (the “Second Amendment”) with Wells Fargo and other lenders party to the Credit Agreement. Pursuant to the Second Amendment, the maximum capacity under the Credit Facility was reduced from $3.6 billion to $3.3 billion, which included a reduction in the size of the $2.45 billion revolving credit facility to $2.3 billion and the elimination of the $150.0 million multicurrency revolving credit facility. The maximum aggregate dollar amount of letters of credit that may be outstanding at any one time under the Credit Facility was reduced from $50.0 million to $25.0 million. 

In respect of financial covenants, the Second Amendment reduced the Company’s minimum Unencumbered Asset Value (as defined in the Credit Agreement) from $10.5 billion to $8.0 billion. For the purposes of determining Unencumbered Asset Value, the Company is permitted to include restaurant properties representing more than 30% of its Unencumbered Asset Value in such calculation such that: (i) from July 1, 2015 to June 29, 2016, up to 40% of the Unencumbered Asset Value may be comprised of restaurant properties; and (ii) from June 30, 2016 to December 30, 2016, up to 35% of the Unencumbered Asset Value may be comprised of restaurant properties. From December 31, 2016, the maximum percentage of Unencumbered Asset Value attributable to restaurant properties will be reduced back down to 30%. In connection with the Second Amendment, the Company agreed to pay certain customary fees to the consenting lenders and agreed to reimburse customary expenses of the arrangers, which are recorded as deferred financing costs and included in rent and tenant receivables and other assets, net in the accompanying consolidated balance sheets.

As of March 31, 2016, the Credit Facility allowed for maximum borrowings of $3.3 billion, consisting of a $1.0 billion term loan facility and a $2.3 billion revolving credit facility. The outstanding balance on the Credit Facility was $1.3 billion, of which $0.3 billion bore a floating interest rate of 2.24%, at March 31, 2016. The remaining outstanding balance on the Credit Facility of $1.0 billion is, in effect, fixed through the use of derivative instruments used to hedge interest rate volatility. Including the spread, which can vary based on the General Partner’s credit rating, the interest rate on this portion was 3.29% at March 31, 2016. As of March 31, 2016, a maximum of $2.0 billion was available to the OP for future borrowings, subject to borrowing availability.

The revolving credit facility generally bears interest at an annual rate of LIBOR plus 1.00% to 1.80% or Base Rate plus 0.00% to 0.80% (based upon the General Partner’s then current credit rating). “Base Rate” is defined as the highest of the prime rate, the federal funds rate plus 0.50% or a floating rate based on one month LIBOR, determined on a daily basis. The term loan facility generally bears interest at an annual rate of LIBOR plus 1.15% to 2.05%, or Base Rate plus 0.15% to 1.05% (based upon the General Partner’s then current credit rating). In addition, the Credit Agreement provides the flexibility for interest rate auctions, pursuant to which, at the Company’s election, the Company may request that lenders make competitive bids to provide revolving loans, which competitive bids may be at pricing levels that differ from the foregoing interest rates.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

The Credit Agreement provides for monthly interest payments under the Credit Facility. In the event of default, at the election of a majority of the lenders (or automatically upon a bankruptcy event of default with respect to the OP or the General Partner), the commitments of the lenders under the Credit Facility will mature, and payment of any unpaid amounts in respect of the Credit Facility will be accelerated. The revolving credit facility and the term loan facility both terminate on June 30, 2018, in each case, unless extended in accordance with the terms of the Credit Agreement. The Credit Agreement provides for a one-year extension option with respect to each of the revolving credit facility and the term loan facility, exercisable at the Company’s election and subject to certain customary conditions, as well as certain customary “amend and extend” provisions. At any time, upon timely notice by the OP and subject to any breakage fees, the OP may prepay borrowings under the Credit Facility (subject to certain limitations applicable to the prepayment of any loans obtained through an interest rate auction, as described above). The OP incurs a fee equal to 0.15% to 0.25% per annum (based upon the General Partner’s then current credit rating) multiplied by the commitments (whether or not utilized) in respect of the revolving credit facility. In addition, the OP incurs customary administrative agent, letter of credit issuance, letter of credit fronting, extension and other fees.

The Credit Facility requires restrictions on corporate guarantees, as well as the maintenance of financial covenants, including the maintenance of certain financial ratios (such as specified debt to equity and debt service coverage ratios) and the maintenance of a minimum net worth. The key financial covenants in the Credit Facility, as defined and calculated per the terms of the Credit Agreement, include maintaining (i) a maximum leverage ratio less than or equal to 60%, (ii) a minimum fixed charge coverage ratio of at least 1.5x, (iii) a secured leverage ratio less than or equal to 45%, (iv) a total unencumbered asset value ratio less than or equal to 60%, (v) a minimum tangible net worth covenant of at least $5.5 billion, (vi) a minimum unencumbered interest coverage ratio of at least 1.75x and (vii) a minimum unencumbered asset value of at least $8.0 billion. The Company believes it was in compliance with the Credit Agreement and is not restricted from accessing any borrowings under the Credit Facility as of March 31, 2016.

Note 11 –Derivatives and Hedging Activities

Risk Management Objective of Using Derivatives

The Company may use derivative financial instruments, including interest rate swaps, caps, options, floors and other interest rate derivative contracts, to hedge all or a portion of the interest rate risk associated with its borrowings. The principal objective of such arrangements is to minimize the risks and/or costs associated with the Company’s operating and financial structure as well as to hedge specific anticipated transactions. The Company does not intend to utilize derivatives for purposes other than interest rate risk management. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which the Company and its affiliates may also have other financial relationships. The Company does not anticipate that any of the counterparties will fail to meet their obligations.

Cash Flow Hedges of Interest Rate Risk

The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish these objectives, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.

The effective portion of changes in the fair value of derivatives designated that qualify as cash flow hedges is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During the three months ended March 31, 2016, such derivatives were used to hedge the variable cash flows associated with variable-rate debt. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt. During the next 12 months, the Company estimates that an additional $6.0 million will be reclassified from other comprehensive income to interest expense.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

As of March 31, 2016, the Company had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk (dollar amounts in thousands):

Interest Rate Swaps	March 31, 2016
Number of Instruments	16
Notional Amount	$	1,211,457

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in the consolidated balance sheets as of March 31, 2016 and December 31, 2015 (in thousands):

Derivatives Designated as Hedging Instruments	Balance Sheet Location	March 31, 2016			December 31, 2015
Interest rate swaps	Rent and tenant receivables and other assets, net	$	—		$	1,794
Interest rate swaps	Deferred rent, derivative and other liabilities	$	(12,989	)	$	(6,922	)

In January 2014, the Company entered into an interest rate lock agreement with a notional amount of $250.0 million (the “Treasury Lock Agreement”). The Treasury Lock Agreement, which had an original maturity date of February 12, 2014, was entered into to hedge part of the Company’s interest rate exposure associated with the variability in future cash flows attributable to changes in the 10-year U.S. treasury rates related to the planned issuance of debt securities in conjunction with the Cole Merger. In connection with the Company’s offering of Senior Notes in February 2014, the Company settled the Treasury Lock Agreement for $3.9 million, which was accounted for as a cash flow hedge, recorded to other comprehensive loss and will be amortized into earnings over the 10-year term of the Treasury Lock. The Company recognized $0.1 million of interest expense for the three months ended March 31, 2016 related to the Treasury Lock Agreement.

Derivatives Not Designated as Hedging Instruments

Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to interest rate movements and other identified risks but do not meet the requirements to be classified as hedging instruments. A loss of $1.1 million related to the change in the fair value of derivatives not designated as hedging instruments and other ineffectiveness was recorded directly in earnings for the three months ended March 31, 2016. The Company recorded a loss of $1.0 million for the three months ended March 31, 2015.

As of March 31, 2016, the Company had the following outstanding interest rate derivative that was not designated as a qualifying hedging relationship (dollar amounts in thousands):

Interest Rate Swap	March 31, 2016
Number of Instruments	1
Notional Amount	$	51,400

The table below presents the fair value of the Company’s derivative financial instrument not designated as a hedge as well as its classification in the consolidated balance sheets as of March 31, 2016 and December 31, 2015 (in thousands):

Derivatives Not Designated as Hedging Instruments	Balance Sheet Location	March 31, 2016			December 31, 2015
Interest rate swaps	Rent and tenant receivables and other assets, net	$	—		$	98
Interest rate swaps	Deferred rent, derivative and other liabilities	$	(811	)	$	—

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Tabular Disclosure of Offsetting Derivatives

The table below details a gross presentation, the effects of offsetting and a net presentation of the Company’s derivatives as of March 31, 2016 and December 31, 2015 (in thousands). The net amounts of derivative assets or liabilities can be reconciled to the tabular disclosure of fair value. The tabular disclosure of fair value provides the location that derivative assets and liabilities are presented in the accompanying consolidated balance sheets.

	Offsetting of Derivative Assets and Liabilities
	Gross Amounts of Recognized Assets		Gross Amounts of Recognized Liabilities			Gross Amounts Offset in the Consolidated Balance Sheets		Net Amounts of Assets Presented in the Consolidated Balance Sheets		Net Amounts of Liabilities Presented in the Consolidated Balance Sheets			Financial Instruments		Cash Collateral Received		Net Amount
March 31, 2016	$	—	$	(13,800	)	$	—	$	—	$	(13,800	)	$	—	$	—	$	(13,800	)
December 31, 2015	$	1,892	$	(6,922	)	$	—	$	1,892	$	(6,922	)	$	—	$	—	$	(5,030	)

Credit Risk Related Contingent Features

The Company has agreements with each of its derivative counterparties that contain a provision specifying that if the Company either defaults or is capable of being declared in default on any of its indebtedness, the Company could also be declared in default on its derivative obligations.

As of March 31, 2016, the fair value of the interest rate derivatives in a net liability position, including accrued interest but excluding any adjustment for nonperformance risk related to these agreements, was $15.2 million. As of March 31, 2016, the Company has not posted any collateral related to these agreements and was not in breach of any provisions in these agreements. If the Company had breached any of these provisions, it could have been required to settle its obligations under the agreements at their aggregate termination value of $15.2 million at March 31, 2016.

Note 12 – Supplemental Cash Flow Disclosures

Supplemental cash flow information was as follows for the three months ended March 31, 2016 and 2015 (in thousands):

	Three Months Ended March 31,
	2016		2015
Supplemental Disclosures:
Cash paid for interest	$	93,713	$	109,025
Cash paid for income taxes	$	10,848	$	51
Non-cash investing and financing activities:
Accrued capital expenditures and real estate developments	$	1,327	$	4,126
Accrued repurchases of common stock to settle tax obligation	$	223	$	—
Accrued distributions	$	3,157	$	—
Mortgage note payable relieved by foreclosure	$	—	$	53,798
Mortgage notes payable assumed in real estate disposition	$	55,000	$	24,000

Note 13 – Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016		December 31, 2015
Accrued interest	$	40,215	$	56,273
Accrued real estate taxes	35,134		47,319
Accrued legal fees	13,922		9,212
Accounts payable	2,547		2,868
Accrued other	27,152		36,205
Total	$	118,970	$	151,877

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Note 14 –Commitments and Contingencies

Litigation

The Company is involved in various routine legal proceedings and claims incidental to the ordinary course of its business. There are no material legal proceedings pending against the Company, except as follows:

Government Investigations and Litigation Relating to the Audit Committee Investigation

On October 29, 2014, the Company filed a Current Report on Form 8-K (the “October 29 8-K”) reporting the Audit Committee’s conclusion, based on the preliminary findings of its investigation, that certain previously issued consolidated financial statements of the Company, including those included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013 and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014, and related financial information should no longer be relied upon. Prior to that filing, the Audit Committee previewed for the SEC the information contained in the filing. Subsequent to that filing, the SEC provided notice that it had commenced a formal investigation and issued subpoenas calling for the production of various documents. In addition, the United States Attorney’s Office for the Southern District of New York contacted counsel for the Audit Committee and counsel for the Company with respect to this matter, and the Secretary of the Commonwealth of Massachusetts issued a subpoena calling for the production of various documents. The Audit Committee and the Company are cooperating with these regulators in their investigations.

As discussed below, the Company and certain of its former officers and current and former directors have been named as defendants in a number of lawsuits filed following the October 29 8-K, including class actions, derivative actions, and individual actions under the federal securities laws and state common and corporate laws in both federal and state courts in New York, Maryland and Arizona.

Between October 30, 2014 and January 20, 2015, the Company and certain of its former officers and current and former directors, among other individuals and entities, were named as defendants in ten putative securities class action complaints filed in the United States District Court for the Southern District of New York (the “SDNY Actions”). The Court subsequently consolidated the SDNY Actions under the caption In re American Realty Capital Properties, Inc. Litigation, No. 15-MC-00040 (AKH) (the “SDNY Consolidated Securities Class Action”). Following motions to dismiss filed by the defendants, which were granted in part and denied in part, the lead plaintiff filed an amended class action complaint on December 11, 2015, which asserted claims for violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Certain defendants, including the Company filed motions to dismiss the second amended class action complaint (or portions thereof) on February 12, 2016. The motions to dismiss are fully briefed and the Court has scheduled oral argument on May 12, 2016.

In addition, on November 25, 2014, the Company and certain of its former officers and current and former directors were named as defendants in a putative securities class action complaint filed in the Circuit Court for Baltimore County, Maryland, captioned Wunsch v. American Realty Capital Properties, Inc., et al., No. 03-C-14-012816 (the “Wunsch Action”). On December 23, 2014, the Company removed the action to the United States District Court for the District of Maryland and on April 15, 2015, the Maryland court transferred the Wunsch Action to the United States District Court for the Southern District of New York. On December 15, 2015, the Wunsch Action was consolidated with the SDNY Consolidated Securities Class Action.

In January 2015, the Company and certain of its former directors and officers were named as defendants in an individual securities fraud action filed in the United States District Court for the Southern District of New York, captioned Jet Capital Master Fund, L.P. v. American Realty Capital Properties, Inc., et al., No. 15-cv-307 (AKH) (the “Jet Capital Action”). The Jet Capital Action seeks money damages and asserts claims for alleged violations of Sections 10(b), 18 and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, as well as common law fraud under New York law in connection with the purchase of the Company’s securities. On April 17, 2015, the plaintiff filed an amended complaint. On October 27, 2015, the court denied defendants’ motions to dismiss the complaint and all defendants filed answers to the complaint by December 18, 2015.

The Company, certain of its former officers and current and former directors, and the OP (in addition to several other individuals and entities) have also been named as defendants in two additional individual securities fraud actions filed in the United States District Court for the Southern District of New York, captioned Twin Securities, Inc. v. American Realty Capital Properties, Inc., et al., No. 15-cv-1291 (the “Twin Securities Action”) and HG Vora Special Opportunities Master Fund, Ltd v. American Realty Capital Properties, Inc., et al., No. 15-cv-4107 (the “HG Vora Action”). The Twin Securities Action and the HG Vora Action seek money damages and assert claims for alleged violations of Sections 10(b), 14(a), 18, and 20(a) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14a-9 promulgated thereunder, Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as well as

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

common law fraud under New York law in connection with the purchase of the Company’s securities. The Company and defendants are not yet required to respond to the complaints in either of these actions.

On October 27, 2015, the Company and certain of its former officers, the OP, and other entities were named as defendants in an individual securities fraud action filed in the United States District Court for the District of Arizona, captioned Vanguard Specialized Funds, et al. v. VEREIT, Inc. et al., No. 15-cv-02157 (ESW) (the “Vanguard Action”). The Vanguard Action seeks money damages and asserts claims for alleged violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b), 14(a) and 20(a) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14a-9 promulgated thereunder, arising out of allegedly false and misleading statements in connection with the purchase or sale of the Company’s securities. The Vanguard Action also asserts claims under Arizona law pursuant to the Arizona Consumer Fraud Act and seeks punitive damages thereunder. On January 21, 2016, the Company filed a motion to transfer the Vanguard Action to the United States District Court for the Southern District of New York and a motion to dismiss the complaint. The motions are fully briefed and pending before the court.

On October 27 and October 28, 2015, the Company and certain of its former officers, the OP, and other entities were named as defendants in four individual securities fraud actions filed in the United States District Court for the Southern District of New York: BlackRock ACS US Equity Tracker Fund, et al. v. American Realty Capital Properties, Inc. et al., No. 15-cv-08464 (the “BlackRock Action”); PIMCO Funds: PIMCO Diversified Income Fund, et al. v. American Realty Capital Properties, Inc. et al., No. 15-cv-08466 (the “PIMCO Action”); Clearline Capital Partners LP, et al. v. American Realty Capital Properties, Inc. et al., No. 15-cv-08467 (the “Clearline Action”); and Pentwater Equity Opportunities Master Fund Ltd., et al. v. American Realty Capital Properties, Inc. et al., No. 15-cv-08510 (the “Pentwater Action”). All four actions seek money damages arising out of allegedly false and misleading statements in connection with the purchase or sale of the Company’s securities. The BlackRock Action and the PIMCO Action assert claims for alleged violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The BlackRock Action also asserts claims under Section 14(a) of the Securities Exchange Act of 1934 and Rule 14a-9 promulgated thereunder. The Clearline Action and the Pentwater Action assert claims under Sections 10(b), 18(a) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The Clearline Action and the Pentwater Action also assert a claim for common law fraud under New York law and seek punitive damages thereunder. The Company is not yet required to respond to the complaints in these actions.

On October 28, 2015, the Company and certain of its former officers and directors (among other individuals and entities) were named as defendants in a putative securities class action complaint filed in the United States District Court for the Southern District of New York: IRA FBO John Esposito v. American Realty Capital Properties, Inc. et al., No. 15-cv-08508 (the “Esposito Action”). The Esposito Action seeks money damages and asserts claims for alleged violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Section 14(a) of the Securities Exchange Act of 1934 and Rule 14a-9 promulgated thereunder, arising out of allegedly false and misleading statements in connection with the purchase or sale of the Company’s securities. The Company is not yet required to respond to the complaint in the Esposito Action.

On July 31, 2015, the Company and certain of its former officers and current and former directors were named as defendants in a shareholder derivative action filed in the United States District Court for the Southern District of New York, captioned Witchko v. Schorsch, et al., No. 15-cv-06043 (AKH) (the “Witchko Action”). The Witchko Action asserts claims under Section 14 of the Exchange Act arising out of allegedly false and misleading statements made in the Company’s proxy statements and the incorporation by reference of allegedly false and misleading financial statements. The Witchko Action also seeks money damages and other relief on behalf of the Company, for, among other things, alleged breach of fiduciary duty, abuse of control and unjust enrichment. On October 15, 2015, the Company and other defendants filed motions to dismiss the Witchko Action due to plaintiff’s failure to plead facts, as required under Maryland law, demonstrating that the Board’s decision to refuse plaintiff’s pre-suit demand was wrongful and not a protected business judgment.

On October 30, 2015, the Company and certain of its former officers and directors were named as defendants in a shareholder derivative action filed in the United States District Court for the Southern District of New York, captioned Serafin, et al. v. Schorsch, et al., No. 15-cv-08563 (the “Serafin Action”). The Serafin Action seeks money damages and other relief on behalf of the Company for, among other things, alleged breach of fiduciary duty and contribution and indemnification. The court has consolidated the Witchko Action and the Serafin Action (together “the SDNY Derivative Action”) and the plaintiffs have designated the complaint filed in the Witchko Action as the complaint in the SDNY Derivative Action. On February 12, 2016, the Company and other defendants filed a motion to dismiss the SDNY Derivative Action due to plaintiffs’ failure to plead facts, as required under Maryland law, demonstrating that the Board’s decision to refuse plaintiff’s pre-suit demand was wrongful and not a protected business judgment. Other defendants also filed motions to dismiss for failure to state a claim. The motions to dismiss are fully briefed and the Court has scheduled oral argument on May 12, 2016.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

On December 3, 2015, the Company and certain of its former officers and directors were named as defendants in a shareholder derivate action filed in the Circuit Court for Baltimore City in Maryland, captioned Frampton v. Schorsch, et al., No. 24-C-15-006269 (the “Frampton Action”). The Frampton Action seeks money damages and other relief on behalf of the Company for, among other things, alleged breaches of fiduciary duty and contribution and indemnification. The Company filed a motion to stay the Frampton Action on March 7, 2016. That motion is fully briefed and pending before the court.

The Company has not reserved amounts for any of the litigation or investigation matters above either because it has not concluded that a loss is probable in the matter or because it believes that any probable loss or reasonably possible range of loss is not reasonably estimable at this time. The Company is currently unable to estimate a range of reasonably possible loss because these matters involve significant uncertainties, including the complexity of the facts and the legal theory and the nature of the claims.

CapLease Litigation Matters

Following the announcement of the merger agreement with CapLease in May 2013, a number of lawsuits were filed by CapLease stockholders, the following of which remain pending:

On June 25, 2013, a putative class action and derivative lawsuit was filed in the Circuit Court for Baltimore City against the Company, the OP, CapLease, and members of the CapLease board of directors, among others, captioned Tarver v. CapLease, Inc., et al., No. 24-C-13-004176 (the “Tarver Action”). The complaint alleged, among other things, that the merger agreement was the product of breaches of fiduciary duty by the CapLease directors because the transaction purportedly did not provide for full and fair value for the CapLease shareholders and was not the result of a competitive bidding process, the merger agreement allegedly contained coercive deal protection measures and the merger was purportedly approved as a result of improper self-dealing by certain defendants who would receive certain alleged employment compensation benefits and continued employment pursuant to the merger agreement.

In August 2013, counsel in the Tarver Action filed a motion for a stay in the Baltimore Court, informing the court that the plaintiff had agreed to join and participate in the prosecution of other actions concerning the CapLease transaction then pending in a New York court (which were subsequently dismissed). The stay was granted by the Baltimore Court and the parties have engaged in no subsequent activity in the Tarver Action.

In October 2013, a putative class action lawsuit was filed in the Circuit Court for Baltimore City against the Company, the OP, CapLease, and members of the CapLease board of directors, among others, captioned Poling v. CapLease, Inc., et al., No. 24-C-13-006178 (the “Poling Action”). The complaint alleged that the merger agreement breached the terms of the CapLease 8.375% Series B Cumulative Redeemable Preferred Stock (“Series B”) and the terms of the 7.25% Series C Cumulative Redeemable Preferred Stock (“Series C”) and was in violation of the Series B Articles Supplementary and the Series C Articles Supplementary. The complaint alleged claims for breach of contract and breach of fiduciary duty against the CapLease entities and the CapLease board of directors, and that the Company, the OP and Safari Acquisition, LLC aided and abetted CapLease and the CapLease directors’ alleged breach of contract and breach of fiduciary duty.

In December 2013, all Defendants filed a motion to dismiss the Poling Action, which was granted by the court in May 2015. Plaintiff filed a notice of appeal on June 4, 2015. The appeal is pending.

Cole Litigation Matters

Two actions filed in March and April 2013 in the United States District Court for the District of Arizona, assert shareholder class action claims under the Securities Act of 1933, along with claims for breach of fiduciary duty, abuse of control, corporate waste, and unjust enrichment, among others, relating to the merger between a wholly owned subsidiary of Cole and Cole Holdings Corporation, pursuant to which Cole became a self-managed REIT; Schindler v. Cole Holdings Corp., et al., 13-cv-00712 (the “Schindler Action”); and Carter v. Cole Holdings Corp., et al., 13-cv-00629 (the “Carter Action”). Defendants filed a motion to dismiss both complaints in January 2014. Both of those lawsuits were stayed by the Court pursuant to a joint request made by all parties pending final approval of a consolidated action in the Circuit Court for Baltimore City, Maryland, which case was finally resolved on appeal on February 1, 2016. The Carter Action was subsequently dismissed voluntarily by Plaintiffs on March 30, 2016 and the Schindler Action was dismissed with prejudice by the court on April 14, 2016.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

In December 2013, Realistic Partners filed a putative class action lawsuit against the Company and the then-members of its board of directors in the Supreme Court for the State of New York, captioned Realistic Partners v. American Realty Capital Partners, et al., No. 654468/2013. Cole was later added as a defendant. The plaintiff alleged, among other things, that the board of the Company breached its fiduciary duties in connection with the transactions contemplated under the Cole Merger Agreement and that Cole aided and abetted those breaches. In January 2014, the parties entered into a memorandum of understanding regarding settlement of all claims asserted on behalf of the alleged class of the Company’s stockholders. The proposed settlement terms required the Company to make certain additional disclosures related to the Cole Merger, which were included in a Current Report on Form 8-K filed by the Company with the SEC on January 17, 2014. The memorandum of understanding also contemplated that the parties would enter into a stipulation of settlement, which would be subject to customary conditions, including confirmatory discovery and court approval following notice to the Company’s stockholders, and provided that the defendants would not object to a payment of up to $625,000 for attorneys’ fees. If the parties enter into a stipulation of settlement, which has not occurred, a hearing will be scheduled at which the court will consider the fairness, reasonableness and adequacy of the settlement. There can be no assurance that the parties will ultimately enter into a stipulation of settlement, that the court will approve any proposed settlement, or that any eventual settlement will be under the same terms as those contemplated by the memorandum of understanding.

Contractual Lease Obligations

The following table reflects the minimum base rent payments due from the Company over the next five years and thereafter for certain ground lease obligations, which are substantially reimbursable by our tenants, and office lease obligations (in thousands):

	Future Minimum Base Rent Payments
	Ground Leases		Office Leases
April 1, 2016 - December 31, 2016	$	10,659	$	3,793
2017	14,820		4,585
2018	14,410		4,704
2019	14,146		4,769
2020	13,386		4,797
Thereafter	224,648		14,089
Total	$	292,069	$	36,737

Purchase Commitments

Cole Capital enters into purchase and sale agreements and deposits funds into escrow towards the purchase of real estate assets, most of which are expected to be assigned to one of the Cole REITs at or prior to the closing of the respective acquisition. As of March 31, 2016, Cole Capital was a party to eight purchase and sale agreements with unaffiliated third-party sellers to purchase a 100% interest in 18 properties, subject to meeting certain criteria, for an aggregate purchase price of $160.4 million, exclusive of closing costs. As of March 31, 2016, Cole Capital had $3.0 million of property escrow deposits held by escrow agents in connection with these future property acquisitions, which may be forfeited if the transactions are not completed under certain circumstances. Cole Capital will be reimbursed by the assigned Cole REIT for amounts escrowed when the property is assigned to the respective Cole REIT.

Environmental Matters

In connection with the ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. The Company has not been notified by any governmental authority of any non-compliance, liability or other claim, and is not aware of any other environmental condition, in each case, that it believes will have a material adverse effect on the results of operations.

Note 15 – Equity

Common Stock and General Partner OP Units

The General Partner is authorized to issue up to 1.5 billion shares of Common Stock. As of March 31, 2016, the General Partner had approximately 904.8 million shares of Common Stock issued and outstanding.

Additionally, the Operating Partnership had approximately 904.8 million General Partner OP Units issued and outstanding as of March 31, 2016, corresponding to the General Partner’s outstanding shares of Common Stock.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Preferred Stock and Preferred OP Units

Series F Preferred Stock

On January 3, 2014, in connection with the merger of American Realty Capital Trust IV, Inc with and into a subsidiary of the OP (the “ARCT IV Merger”), 42.2 million shares of Series F Preferred Stock were issued, resulting in the Operating Partnership concurrently issuing 42.2 million General Partner Series F preferred units (“General Partner Series F Preferred Units”) to the General Partner, and 700,000 Series F Preferred Units (“Limited Partner Series F Preferred Units”) to holders of each outstanding unit of American Realty Capital Operating Partnership IV, L.P. (the “ARCT IV Operating Partnership”) (each, an “ARCT IV OP Unit”). As of March 31, 2016, there were approximately 42.8 million shares of Series F Preferred Stock (and approximately 42.8 million corresponding General Partner Series F Preferred Units) and 86,874 Limited Partner Series F Preferred Units issued and outstanding.

The Series F Preferred Stock will pay cumulative cash dividends at the rate of 6.70% per annum on their liquidation preference of $25.00 per share (equivalent to $1.675 per share on an annual basis). The Series F Preferred Stock is not redeemable by the Company before the fifth anniversary of the date on which such Series F Preferred Stock was issued (the “Initial Redemption Date”), except under circumstances intended to preserve the General Partner’s status as a REIT for federal and/or state income tax purposes and except upon the occurrence of a change of control. On and after the Initial Redemption Date, the General Partner may, at its option, redeem shares of the Series F Preferred Stock, in whole or from time to time in part, at a redemption price of $25.00 per share plus, subject to exceptions, any accrued and unpaid dividends thereon to the date fixed for redemption. The shares of Series F Preferred Stock have no stated maturity, are not subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless the General Partner redeems or otherwise repurchases them or they become convertible and are converted into Common Stock (or, if applicable, alternative consideration). The Series F Preferred Stock trades on the NYSE under the symbol “VER PRF”. The Series F Preferred Units contain the same terms as the Series F Preferred Stock.

Limited Partner OP Units

As of March 31, 2016 and 2015, the Operating Partnership had approximately 23.8 million of Limited Partner OP Units outstanding.

On March 11, 2015, the Company received redemption requests totaling approximately 13.1 million OP Units ($126.7 million based on a redemption price of $9.65) from certain affiliates of the Former Manager. The Company believes it has potential claims against recipients of those OP Units and has engaged in discussions with affiliates of the Former Manager regarding the redemption requests. Pending any resolution, the Company does not currently intend to satisfy any of the redemption requests. In light of the potential claims, since October 15, 2015, the OP has not paid distributions in respect of a substantial portion of the outstanding Limited Partner OP Units when the Common Stock dividends were otherwise paid.

Common Stock Dividends

On February 23, 2016, the Company’s board of directors declared a quarterly cash dividend of $0.1375 per share of common stock (equaling an annualized dividend rate of $0.55 per share) for the first quarter of 2016 to stockholders of record as of March 31, 2016, which was paid on April 15, 2016. An equivalent distribution by the Operating Partnership is applicable per OP unit.

Common Stock Repurchases

Under the General Partner’s Equity Plan (defined below), individuals have the option to have the General Partner repurchase shares vesting from awards made under the Equity Plan in order to satisfy the minimum federal and state tax withholding obligations. During the three months ended March 31, 2016, the General Partner repurchased 127,741 shares to satisfy the federal and state tax withholding on behalf of employees.

Note 16 – Equity-based Compensation

Equity Plan

The General Partner has adopted an equity plan (the “Equity Plan”), which provides for the grant of stock options, stock appreciation rights, restricted shares of Common Stock (“Restricted Shares”), restricted stock units (“Restricted Stock Units”), dividend equivalent rights and other stock-based awards to the General Partner’s and its affiliates’ non-executive directors, officers and other employees and advisors or consultants who are providing services to the General Partner or its affiliates. To date, the General Partner has granted fully vested shares of Common Stock, Restricted Shares, Restricted Stock Units and Deferred Stock Units (defined below) under the Equity Plan. Restricted Shares provide for rights identical to those of Common Stock. Restricted

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Stock Units do not provide for any rights of a common stockholder prior to the vesting of such Restricted Stock Units. In accordance with U.S. GAAP, Restricted Shares are considered issued and outstanding. As is the case when fully vested shares of Common Stock are issued from the Equity Plan, for each Restricted Share awarded under the Equity Plan, the Operating Partnership issues a General Partner OP Unit to the General Partner with identical terms. Upon vesting of Restricted Stock Units, the Operating Partnership issues a General Partner OP Unit to the General Partner for each share of Common Stock issued as a result of such vesting.

The General Partner has authorized and reserved a total number of shares equal to 10.0% of the total number of issued and outstanding shares of Common Stock (on a fully diluted basis assuming the redemption of all OP Units for shares of Common Stock) to be issued at any time under the Equity Plan for equity incentive awards. As of March 31, 2016, the General Partner had cumulatively awarded under its Equity Plan approximately 4.2 million Restricted Shares, net of the forfeiture of 3.5 million Restricted Shares through that date, 3.6 million Restricted Stock Units, net of the forfeiture of 0.4 million Restricted Stock Units through that date, and 0.1 million Deferred Stock Units, collectively representing approximately 7.9 million shares of Common Stock. Accordingly, as of such date, approximately 85.0 million additional shares were available for future issuance.

Restricted Shares

The Company has issued Restricted Shares to certain employees and non-executive directors beginning in 2011. In addition, the Company issued Restricted Shares to employees of affiliates of the Former Manager prior to 2015. The fair value of the Restricted Shares granted to employees under the Equity Plan is generally determined using the closing stock price on the grant date and is expensed over the requisite service period on a straight-line basis. The fair value of Restricted Shares granted to non-executive directors and employees of affiliates of the Former Manager under the Equity Plan was measured based upon the fair value of goods or services received or the equity instruments granted, whichever was more reliably determinable, and was expensed in full at the date of grant.

During the three months ended March 31, 2016, the Company recorded $0.3 million of compensation expense related to the Restricted Shares, which is recorded in general and administrative expense in the accompanying consolidated statements of operations.

The following table details the activity of the Restricted Shares during the three months ended March 31, 2016:

	Restricted Shares		Weighted-Average Grant Date Fair Value
Unvested shares, December 31, 2015	1,239,662		$	13.86
Vested	(363,973	)	14.12
Forfeited	(7,253	)	14.02
Unvested shares, March 31, 2016	868,436		$	13.75

Time-Based Restricted Stock Units

Under the Equity Plan, the Company may award Restricted Stock Units to employees that will vest if the recipient maintains his/her employment over the requisite service period (the “Time-Based Restricted Stock Units”). The fair value of the Time-Based Restricted Stock Units granted to employees under the Equity Plan is generally determined using the closing stock price on the grant date and is expensed over the requisite service period on a straight-line basis, which is generally three years. During the three months ended March 31, 2016, the Company recorded $0.6 million of compensation expense related to the Time-Based Restricted Stock Units, which is recorded in general and administrative expense in the accompanying consolidated statements of operations.

Deferred Stock Units

The Company may award Deferred Stock Units to non-executive directors under the Equity Plan (the “Deferred Stock Units”). Each Deferred Stock Unit represents the right to receive one share of Common Stock. The Deferred Stock Units provide for immediate vesting on the grant date and will be settled with Common Stock either on the earlier of the date on which the respective director separates from the Company or the third anniversary of the grant date, or if granted pursuant to the director’s voluntary election to participate in the director’s deferred compensation program, on the date the director separates from the Company. The fair value of the Deferred Stock Units is determined using the closing stock price on the grant date and is expensed over the requisite service period or on the grant date for awards with no requisite service period. During the three months ended March 31, 2016, the Company recorded approximately $33,700 of expense related to Deferred Stock Units, which is recorded in general and administrative expense in the accompanying consolidated statements of operations. The service inception date of these Deferred Stock Units preceded the grant date, which is subsequent to March 31, 2016.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

The following table details the activity of the Time-Based Restricted Stock Units and Deferred Stock Units during the three months ended March 31, 2016.

	Time-Based Restricted Stock Units		Weighted-Average Grant Date Fair Value		Deferred Stock Units	Weighted-Average Grant Date Fair Value
Unvested units, December 31, 2015	589,138		$	9.61	—	$	—
Granted	725,921		7.81		—	—
Vested	(7,965	)	9.76		—	—
Unvested units, March 31, 2016	1,307,094		$	8.61	—	$	—

Market-Based Restricted Stock Units

During the year ended December 31, 2015, the General Partner awarded Restricted Stock Units to certain employees under the Equity Plan that are contingent upon the Common Stock reaching a certain market price (the “Market-Based Restricted Stock Units”). The Market-Based Restricted Stock Units are contingent upon the closing price of the Common Stock exceeding $10 per share for 20 consecutive trading days (the “Market Condition”) and continued employment as of such date on which the Market Condition is met. If the Market Condition is not satisfied by December 31, 2017, the Market-Based Restricted Stock Units will become null and void. The fair value and derived service period of the Market-Based Restricted Stock Units as of their grant date is determined using a Monte Carlo simulation, which takes into account multiple input variables that determine the probability of satisfying the Market Condition. The method requires the input of assumptions, including the future dividend yield and expected volatility of the Common Stock. Compensation expense is recognized on a straight-line basis over the derived service period regardless of whether the Market Condition is satisfied, provided that the requisite service condition has been achieved. The Market-Based Restricted Stock Units were fully expensed during the year ended December 31, 2015, however the Company may record contra-expense due to the forfeiture of such awards. During the three months ended March 31, 2016, the Company recorded contra-expense of $0.2 million related to the Market-Based Restricted Stock Units which is recorded in general and administrative expense in the accompanying consolidated statements of operations.

Long-Term Incentive Awards

The General Partner may award long-term incentive-based Restricted Stock Units (the “LTI Target Awards”) to employees under the Equity Plan. Vesting of the LTI Target Awards is based upon the General Partner’s level of achievement of total stockholder return (“TSR”), including both share price appreciation and Common Stock dividends, as measured equally against a market index and against a peer group generally over a three year period.

The fair value and derived service period of the LTI Target Awards as of their grant date is determined using a Monte Carlo simulation which takes into account multiple input variables that determine the probability of satisfying the required TSR, as outlined in the award agreements. This method requires the input of assumptions, including the future dividend yield, the expected volatility of the Common Stock and the expected volatility of the market index constituents and the peer group. Compensation expense is recognized on a straight-line basis over the derived service period regardless of whether the necessary TSR is attained, provided that the requisite service condition has been achieved. During the three months ended March 31, 2016, the Company recorded $1.0 million of expense related to the LTI Target Awards, which is recorded in general and administrative expense in the accompanying consolidated statements of operations.

The following table details the activity of the unvested Market-Based Restricted Stock Units and the LTI Target Awards during the three months ended March 31, 2016.

	Market-Based Restricted Stock Units		Weighted-Average Grant Date Fair Value		LTI Target Awards	Weighted-Average Grant Date Fair Value
Unvested units, December 31, 2015	704,804		$	8.58	731,448	$	11.38
Granted	—		—		850,942	7.13
Forfeited	(25,677	)	8.58		—	—
Unvested units, March 31, 2016	679,127		$	8.58	1,582,390	$	9.09

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Note 17 –Related Party Transactions and Arrangements

Cole Capital

Cole Capital is contractually responsible for managing the Cole REITs’ affairs on a day-to-day basis, identifying and making acquisitions and investments on the Cole REITs’ behalf, and recommending to the respective board of directors of each of the Cole REITs an approach for providing investors with liquidity. In addition, the Company distributes the shares of common stock for certain Cole REITs and advises them regarding offerings, manages relationships with participating broker-dealers and financial advisors and provides assistance in connection with compliance matters relating to the offerings. The Company receives compensation and reimbursement for services relating to the Cole REITs’ offerings and the investment, management and disposition of their respective assets, as applicable.

Offering-Related Revenue

The Company generally receives a selling commission and dealer manager or distribution fee based on the gross offering proceeds related to the sale of shares of the Cole REITs’ common stock in their primary offerings, before reallowance of commissions earned by participating broker-dealers. The Company has reallowed 100% of selling commissions earned to participating broker-dealers. The Company, in its sole discretion, may reallow all or a portion of its dealer manager fee to such participating broker-dealers as a marketing and due diligence expense reimbursement, based on factors such as the volume of shares issued by such participating broker-dealers and the amount of marketing support provided by such participating broker-dealers. No selling commissions or dealer manager fees are paid to the Company or other broker-dealers with respect to shares issued under the respective Cole REIT’s distribution reinvestment plan, under which the stockholders may elect to have distributions reinvested in additional shares.

All other organization and offering expenses associated with the sale of the Cole REITs’ common stock are paid for in advance by the Company and subject to reimbursement by the Cole REITs, up to certain limits in accordance with their respective advisory agreements and charters. As these costs are incurred, they are recorded as reimbursement revenue, up to the respective limit, and are included in offering-related revenues in the financial results for Cole Capital. Expenses paid on behalf of the Cole REITs in excess of these limits that are expected to be collected based on future estimated offering proceeds are recorded as program development costs, which are included in rent and tenant receivables and other assets, net in the accompanying consolidated balance sheets. The Company assesses the collectability of the program development costs, considering the offering period and historical and forecasted sales of shares under the Cole REITs’ respective offerings and reserves for any balances considered not collectible. Additional reserves are generally recorded if actual proceeds raised from the offerings and corresponding program development costs incurred differ from management’s assumptions. As of March 31, 2016 and December 31, 2015, the Company had organization and offering costs recorded as program development costs, included in rent and tenant receivables and other assets, net in the consolidated balance sheets, of $13.6 million and $12.9 million, respectively, which were net of reserves of $37.8 million and $34.8 million, respectively.

The following table shows the offering fee summary information for the Cole REITs as of March 31, 2016:

Program	Selling Commissions (1)	Dealer Manager and Distribution Fees (2)
Open Programs
CCPT V	7%	2%
INAV (3)
Wrap Class Shares	—%	0.55%
Advisor Class Shares	up to 3.75%	0.55% and 0.50%
Institutional Class Shares	—%	0.25%
CCIT II	7%	2%

_______________________________________________

(1) The Company reallows 100% of selling commissions earned to participating broker-dealers.

(2) The Company may reallow all or a portion of its dealer manager fee or applicable distribution fee to participating broker-dealers as a marketing and due diligence expense reimbursement.

(3) In connection with the INAV offering, the Company receives selling commissions, an asset-based dealer manager fee and/or an asset-based distribution fee, all based on the net asset value for each class of common stock.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Transaction Service Revenue

The Company earns acquisition fees related to the acquisition, development or construction of properties on behalf of certain of the Cole REITs. In addition, the Company is reimbursed for acquisition expenses incurred in the process of acquiring properties up to certain limits per the respective advisory agreement. The Company is not reimbursed for personnel costs in connection with services for which it receives acquisition fees or real estate commissions. In addition, the Company may earn disposition fees related to the sale of one or more properties, including those held indirectly through joint ventures, on behalf of a Cole REIT and other affiliates.

The following table shows the transaction-related fees for the Cole REITs and other real estate programs as of March 31, 2016:

Program	Acquisition Fees (1)	Disposition Fees	Performance Fees (2)
Open Programs
CCPT V	2%	1%	15%
INAV	—	—	—
CCIT II	2%	1%	15%
Closed Programs
CCPT IV	2%	1%	15%
Other Programs	Various	Various	Various

_______________________________________________

(1) Percent taken on gross purchase price.

(2) Performance fee paid only under the following circumstances: (i) if shares are listed on a national securities exchange; (ii) if the respective Cole REIT is sold or the assets are liquidated; or (iii) upon termination of the advisory agreement. In connection with such events, the performance fee will only be earned upon the return to investors of their net capital invested and an 8% annual cumulative, non-compounded return (6% in the case of CCPT V).

Management Service Revenue

The Company earns advisory and asset and property management fees from certain Cole REITs and other real estate programs. The Company may also be reimbursed for expenses incurred in providing advisory and asset and property management services, subject to certain limitations. In addition, the Company earns a performance fee relating to INAV for any year in which the total return on stockholders’ capital exceeds 6% per annum on a calendar year basis.

The following table shows the management fees for the Cole REITs as of March 31, 2016:

Program	Asset Management / Advisory Fees (1)	Performance Fees (2)
Open Programs
CCPT V	0.65% - 0.75%	—
INAV	0.90%	25%
CCIT II	0.65% - 0.75%	—
Closed Programs
CCPT IV	0.65% - 0.75%	—
Other Programs	Various	—

_______________________________________________

(1) Annualized fee based on the average monthly invested assets or net asset value, if available.

(2) Performance fee paid on the amount in which the total return on stockholders’ capital exceeds 6% per annum on a calendar year basis.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

The table below reflects the revenue earned from the Cole REITs (including closed programs, as applicable) and joint ventures for the three months ended March 31, 2016 and 2015 (in thousands).

	Three Months Ended March 31,
	2016		2015
Offering-related fees and reimbursements
Securities commissions (1)	$	7,041	$	1,775
Dealer manager and distribution fees (2)	2,640		716
Reimbursement revenue	2,710		626
Offering-related fees and reimbursements	12,391		3,117
Transaction service fees and reimbursements
Acquisition fees	1,702		4,488
Disposition fees (3)	—		4,350
Reimbursement revenues	682		571
Transaction service fees and reimbursements	2,384		9,409
Management fees and reimbursements
Asset and property management fees and leasing fees	55		103
Advisory and performance fee revenue	12,050		11,173
Reimbursement revenues	4,123		2,518
Management fees and reimbursements	16,228		13,794
Interest income on Affiliate Lines of Credit	308		408
Total related party revenues(4)	$	31,311	$	26,728

___________________________________

(1) The Company reallows 100% of selling commissions earned to participating broker-dealers.

(2) During the three months ended March 31, 2016 and 2015, the Company reallowed $1.0 million and $0.3 million, respectively, of dealer manager fees to participating broker dealers as a marketing and due diligence expense reimbursement.

(3) The Company earned a disposition fee of $4.4 million on behalf of CCIT when it merged with Select Income REIT on January 29, 2015.

(4) Total related party revenues excludes fees earned from 1031 real estate programs of $0.2 million and $1.2 million for the three months ended March 31, 2016 and 2015, respectively.

Investment in the Cole REITs

As of March 31, 2016 and December 31, 2015, the Company owned aggregate equity investments of $3.8 million and $4.1 million, respectively, in the Cole REITs and other affiliated offerings. The Company accounts for these investments using the equity method of accounting which requires the investment to be initially recorded at cost and subsequently adjusted for the Company’s share of equity in the respective Cole REIT’s earnings and distributions. The Company records its proportionate share of net income from the Cole REITs in other income, net in the consolidated statements of operations. During the three months ended March 31, 2016 and 2015, the Company recognized $122,000 and $44,000 of net loss, respectively, from the Cole REITs.

The table below presents certain information related to the Company’s investments in the Cole REITs as of March 31, 2016 (carrying amount in thousands):

	March 31, 2016
Cole REIT	% of Outstanding Shares Owned	Carrying Amount of Investment
CCPT V	1.14%	$	1,553
INAV	0.12%	149
CCIT II	0.58%	1,388
CCPT IV	0.01%	119
Funds not yet in offering	N/A	600
		$	3,809

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Due to Affiliates

Due to affiliates, as reported in the accompanying consolidated balance sheets, of $0.2 million as of December 31, 2015, related to amounts due to the Cole REITs for expense reimbursements. As of March 31, 2016, there was no such balance due to affiliates.

Due from Affiliates

As of March 31, 2016 and December 31, 2015, $11.6 million and $10.6 million, respectively, was expected to be collected from affiliates, excluding balances from the Cole REITs’ lines of credit, discussed below, related to services provided by the Company and expenses subject to reimbursement by the Cole REITs in accordance with their respective advisory and property management agreements.

As of December 31, 2015, the Company had revolving line of credit agreements in place with CCIT II and CCPT V (the “Affiliate Lines of Credit”) that provided for maximum borrowings of $60.0 million to each of CCIT II and CCPT V and bore variable interest rates of one-month LIBOR plus 2.20%. As of December 31, 2015, there was $50.0 million outstanding on the Affiliate Lines of Credit. During the three months ended March 31, 2016, the Company amended the agreement with CCIT II to extend the maturity date to June 30, 2016 and reduce the maximum borrowing to $30.0 million. During the three months ended March 31, 2016, the agreement with CCPT V matured, at which time CCPT V repaid the outstanding balance of $20.0 million. Additionally, CCIT II paid down the $30.0 million outstanding on its line of credit during the three months ended March 31, 2016.

Note 18 – Net Loss Per Share/Unit

The General Partner’s unvested Restricted Shares contain non-forfeitable rights to dividends and are considered to be participating securities in accordance with U.S. GAAP and, therefore, are included in the computation of earnings per share under the two-class computation method. Under the two-class computation method, net losses are not allocated to participating securities unless the holder of the security has a contractual obligation to share in the losses. The unvested Restricted Shares are not allocated losses as the awards do not have a contractual obligation to share in losses of the General Partner. The two-class computation method is an earnings allocation formula that determines earnings per share for each class of shares of Common Stock and participating securities according to dividends declared (or accumulated) and participation rights in undistributed earnings.

Net Loss Per Share

The following is a summary of the basic and diluted net loss per share computation for the General Partner for the three months ended March 31, 2016 and 2015 (dollar amounts in thousands, except for share and per share data):

	Three Months Ended March 31,
	2016			2015
Net loss attributable to the General Partner	$	(113,086	)	$	(29,970	)
Less: dividends to preferred shares and participating securities	18,098			17,978
Net loss attributable to common stockholders	$	(131,184	)	$	(47,948	)
Weighted average number of common stock outstanding - basic and diluted	903,825,726			902,996,270
Basic and diluted net loss per share attributable to common stockholders	$	(0.15	)	$	(0.05	)

As of March 31, 2016, approximately 23.8 million OP Units were outstanding, which are convertible into an equal number of shares of Common Stock, and approximately 4.4 million of unvested Restricted Shares and unvested Restricted Stock Units were excluded from the calculation of diluted net loss per share as the effect would have been antidilutive.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Net Loss Per Unit

The following is a summary of the basic and diluted net loss per unit computation for the OP for the three months ended March 31, 2016 and 2015 (dollar amounts in thousands, except for unit and per unit data):

	Three Months Ended March 31,
	2016			2015
Net loss attributable to the Operating Partnership	$	(116,041	)	$	(30,873	)
Less: dividends to preferred units and participating securities	18,098			17,978
Net loss attributable to common unitholders	$	(134,139	)	$	(48,851	)
Weighted average number of common units outstanding - basic and diluted	927,589,523			926,760,067
Basic and diluted net loss per unit attributable to common unitholders	$	(0.15	)	$	(0.05	)

As of March 31, 2016, approximately 4.4 million shares of unvested restricted units were excluded from the calculation of diluted net loss per unit as the effect would have been antidilutive.

Note 19 – Income Taxes

As a REIT, the General Partner generally is not subject to federal income tax, with the exception of its TRS entities. However, the General Partner, including its TRS entities, and the Operating Partnership are still subject to certain state and local income and franchise taxes in the various jurisdictions in which they operate.

Cole Capital Income Taxes

Based on the above, Cole Capital’s business, substantially all of which is conducted through a TRS, recognized a benefit of $1.3 million and a provision of $0.2 million for the three months ended March 31, 2016 and 2015, respectively, which are included in provision for income taxes in the accompanying consolidated statements of operations.

REI Income Taxes

The REI segment recognized a provision of $1.4 million and $1.9 million for the three months ended March 31, 2016 and 2015, respectively, which are included in provision for income taxes in the accompanying consolidated statements of operations.

The Company had no unrecognized tax benefits as of or during the three months ended March 31, 2016 and 2015. Any interest and penalties related to unrecognized tax benefits would be recognized in provision for income taxes in the accompanying consolidated statements of operations. The Company files income tax returns in the U.S. federal jurisdiction, Canadian federal jurisdiction and various state and local jurisdictions, and is subject to routine examinations by the respective tax authorities. With few exceptions, the Company is no longer subject to federal or state examinations by tax authorities for years before 2011.

Note 20 – Subsequent Events

The following events occurred subsequent to March 31, 2016:

Real Estate Investment Activity

From April 1, 2016 through May 3, 2016, the Company disposed of 28 properties for an aggregate gross sales price of $48.2 million and an estimated gain of $3.8 million.

Common Stock Dividend

On May 4, 2016, the Company’s board of directors declared a quarterly cash dividend of $0.1375 per share of common stock (equaling an annualized dividend rate of $0.55 per share) for the second quarter of 2016 to stockholders of record as of June 30, 2016, which will be paid on July 15, 2016. An equivalent distribution by the Operating Partnership is applicable per OP unit.

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VEREIT, INC. and VEREIT OPERATING PARTNERSHIP, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016 (Unaudited) – (Continued)

Preferred Stock Dividend

On May 4, 2016, the Company’s board of directors declared a monthly cash dividend to holders of the Series F Preferred Stock for July 2016 through September 2016 in respect to the periods included in the table below. The corresponding record and payment dates for each month's Series F Preferred Stock dividend are also shown in the table below.  The dividend for the Series F Preferred Stock accrues daily on a 360-day annual basis equal to an annualized dividend rate of $1.675 per share, or $0.1395833 per 30-day month.

Period	Record Date	Payment Date
June 15, 2016 - July 14, 2016	July 1, 2016	July 15, 2016
July 15, 2016 - August 14, 2016	August 1, 2016	August 15, 2016
August 15, 2016 - September 14, 2016	September 1, 2016	September 15, 2016

New Cole REIT Share Class

Commencing on April 29, 2016, two of the Cole REITs, CCIT II and CCPT V, began offering Class T shares of common stock (the “Class T Shares”) in addition to the class of shares of common stock already being offered (now referred to as Class A shares). The Class T Shares are subject to selling commissions of 3.0% of the respective Cole REIT’s gross offering proceeds in their primary offering and dealer manager fees of 2.0% of the respective Cole REIT’s gross offering proceeds in their primary offering, before reallowance of commissions earned by participating broker-dealers. In addition, Class T Shares purchased in the respective Cole REIT’s primary offering will pay a distribution and stockholder servicing fee, which accrues daily in the amount of 1/365th of 0.8% of the respective Cole REIT’s estimated net asset value of Class T Shares and will be paid monthly in arrears.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with the accompanying consolidated financial statements and notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q. We make statements in this section that are forward-looking statements within the meaning of the federal securities laws. Certain risks may cause our actual results, performance or achievements to differ materially from those expressed or implied by the following discussion. For a complete discussion of such risk factors, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. Capitalized terms used herein, but not otherwise defined, shall have the meaning ascribed to those terms in the “Part I – Financial Information,” including the notes to the consolidated financial statements contained therein.

Forward-Looking Statements

This Quarterly Report on Form 10-Q includes “forward-looking statements” (within the meaning of the federal securities laws, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act) that reflect our expectations and projections about our future results, performance, prospects and opportunities. We have attempted to identify these forward-looking statements by the use of words such as “may,” “will,” “seek,” “expects,” “anticipates,” “believes,” “targets,” “intends,” “should,” “estimates,” “could” or similar expressions. These forward-looking statements are based on information currently available to us and are subject to a number of known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. These factors include, among other things, those discussed below. We intend for all such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Exchange Act, as applicable by law. We do not undertake publicly to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required to satisfy our obligations under federal securities law.

The following are some, but not all, of the assumptions, risks, uncertainties and other factors that could cause our actual results to differ materially from those presented in our forward-looking statements:

• We may be unable to renew leases, lease vacant space or re-lease space as leases expire on favorable terms or at all.

• We are subject to risks associated with tenant, geographic and industry concentrations with respect to our properties.

• Our properties, goodwill and intangible assets and other assets may be subject to impairment charges.

• We could be subject to unexpected costs or unexpected liabilities that may arise from potential dispositions and may be unable to dispose of properties on advantageous terms.

• We are subject to competition in the acquisition and disposition of properties and in the leasing of our properties and we may be unable to acquire, dispose of, or lease properties on advantageous terms.

• We could be subject to risks associated with bankruptcies or insolvencies of tenants or from tenant defaults generally.

• We may be affected by risks associated with pending government investigations relating to the findings of the Audit Committee Investigation and related litigation.

• We have substantial indebtedness, which may affect our ability to pay dividends, and expose us to interest rate fluctuation risk and the risk of default under our debt obligations.

• Our overall borrowing and operating flexibility may be adversely affected by the terms and restrictions within the indenture governing the Senior Notes and the Credit Facility.

• Our access to capital and terms of future financings may be affected by adverse changes to our credit rating.

• We may be affected by the incurrence of additional secured or unsecured debt.

• We may not be able to achieve and maintain profitability.

• We may not generate cash flows sufficient to pay our dividends to stockholders or meet our debt service obligations.

• We may be affected by risks resulting from losses in excess of insured limits.

• We may fail to remain qualified as a REIT for U.S. federal income tax purposes.

• We may be unable to fully reestablish the financial network which previously supported Cole Capital^® and its Cole REITs and/or regain the prior level of transaction and capital raising volume of Cole Capital.

• Our Cole Capital operations are subject to extensive governmental regulation.

• We are subject to conflicts of interest relating to Cole Capital’s investment management business.

• We may be unable to retain or hire key personnel.

All forward-looking statements should be read in light of the risks identified in Part I, Item 1A. Risk Factors within our Annual Report on Form 10-K.

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We use certain defined terms throughout this Quarterly Report on Form 10-Q that have the following meanings:

When we refer to “annualized rental income,” we mean the rental revenue under our leases on operating properties reflecting straight-line rent adjustments associated with contractual rent increases in the leases as required by U.S. GAAP, which includes the effect of tenant concessions, such as free rent, and excludes any contingent rent, such as percentage rent.

When we refer to a “creditworthy tenant,” we mean a tenant that has entered into a lease that we determine is creditworthy and may include tenants with an investment grade or below investment grade credit rating, as determined by major credit rating agencies, or unrated tenants. To the extent we determine that a tenant is a “creditworthy tenant” even though it does not have an investment grade credit rating, we do so based on our management’s determination that a tenant should have the financial wherewithal to honor its obligations under its lease with us. This determination is based on our management’s substantial experience performing credit analysis and is made after evaluating all tenants’ due diligence materials that are made available to us, including financial statements and operating data.

When we refer to a “direct financing lease,” we mean a lease that requires specific treatment due to the significance of the lease payments from the inception of the lease compared to the fair value of the property, term of the lease, a transfer of ownership, or a bargain purchase option. These leases are recorded as a net asset on the balance sheet. The amount recorded is calculated as the fair value of the remaining lease payments on the leases and the estimated fair value of any expected residual property value at the end of the lease term.

When we refer to properties that are net leased on a “long term” basis, we mean properties with remaining primary lease terms of generally seven to 10 years or longer on average, depending on property type.

Under a “net lease,” the tenant occupying the leased property (usually as a single tenant) does so in much the same manner as if the tenant were the owner of the property. There are various forms of net leases, most typically classified as triple net or double net. Triple net leases typically require the tenant pay all expenses associated with the property (e.g., real estate taxes, insurance, maintenance and repairs). Double net leases typically require that the tenant pay all operating expenses associated with the property (e.g., real estate taxes, insurance and maintenance), but excludes some or all major repairs (e.g., roof, structure and parking lot). Accordingly, the owner receives the rent “net” of these expenses, rendering the cash flow associated with the lease predictable for the term of the lease. Under a net lease, the tenant generally agrees to lease the property for a significant term and agrees that it will either have no ability or only limited ability to terminate the lease or abate rent prior to the expiration of the term of the lease as a result of real estate driven events such as casualty, condemnation or failure by the landlord to fulfill its obligations under the lease.

Overview

We are a full-service real estate operating company that operates through two business segments, our real estate investment segment, REI, and our investment management segment, Cole Capital, as further discussed in “Note 3 –Segment Reporting” to our consolidated financial statements. Through our REI segment, we own and actively manage a diversified portfolio of 4,378 retail, restaurant, office and industrial real estate properties with an aggregate of 99.0 million square feet, of which 98.6% was leased as of March 31, 2016, with a weighted-average remaining lease term of 10.4 years. Through our Cole Capital segment, we are responsible for raising capital for and managing the affairs of the Cole REITs on a day-to-day basis, identifying and making acquisitions and investments on behalf of the Cole REITs, and recommending to the respective board of directors of each of the Cole REITs an approach for providing investors with liquidity. Cole Capital receives compensation and reimbursement for performing these services. As of March 31, 2016, the Cole REITs and other real estate programs’ assets under management were $6.8 billion.

We seek to lease space and/or acquire properties leased to creditworthy tenants that meet our underwriting and operating guidelines. Prior to entering into any transaction, our corporate credit analysis and underwriting professionals conduct a review of a tenant’s credit quality. In addition, we consistently monitor the credit quality of our portfolio by actively reviewing the creditworthiness of certain tenants, focusing primarily on those tenants representing the greatest concentration of our portfolio. This review primarily includes an analysis of the tenant’s financial statements either quarterly, or as frequently as the lease permits. We also consider tenant credit quality when assessing our portfolio for strategic dispositions. When we assess tenant credit quality, we: (i) review relevant financial information, including financial ratios, net worth, revenue, cash flows, leverage and liquidity; (ii) evaluate the depth and experience of the tenant’s management team; and (iii) assess the strength/growth of the tenant’s industry. On an on-going basis, we evaluate the need for an allowance for doubtful accounts arising from estimated losses that could result from the tenant’s inability to make required current rent payments and an allowance against accrued rental income for future potential losses that we deem to be unrecoverable over the term of the lease. The factors considered in determining the credit risk of our tenants include, but are not limited to: payment history; credit status and change in status (credit ratings for public companies are used as a primary metric); change in tenant space needs (i.e., expansion/downsize); tenant financial performance; economic

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conditions in a specific geographic region; and industry specific credit considerations. We are of the opinion that the credit risk of our portfolio is largely mitigated by the high quality of our existing tenant base, reviews of prospective tenants’ risk profiles prior to lease execution and consistent monitoring of our portfolio to identify potential problem tenants.

Operating Highlights and Key Performance Indicators

2016 Activity

• Disposed of 58 properties and one property owned by an unconsolidated joint venture for an aggregate sales price of $307.2 million, of which our share was $295.2 million, resulting in consolidated proceeds of $176.1 million after closing costs, $55.0 million of debt assumptions and $57.0 million of debt repayments by the unconsolidated joint venture.

• Decreased outstanding mortgage loans through property dispositions, mortgage loan maturities and monthly principal payments by $72.8 million, bringing the outstanding principal amount of mortgage loans to $2.97 billion at March 31, 2016.

• Paid down $180.0 million on the revolving credit facility, bringing the outstanding principal balance to $280.0 million at March 31, 2016.

• Declared a quarterly dividend of $0.1375 per share of common stock for the first quarter of 2016, representing an annualized dividend rate of $0.55 per share.

Real Estate Portfolio Metrics

In managing our portfolio, we are committed to diversification by property type, tenant, geography and industry. Below is a summary of our property type diversification and our top ten concentrations as of March 31, 2016, based on annualized rental income of $1.3 billion.

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Our financial performance is influenced by the timing of acquisitions and dispositions and the operating performance of our real estate properties. The following table shows the property statistics of our real estate assets, excluding properties owned through our unconsolidated joint ventures as of March 31, 2016 and 2015:

	March 31, 2016	March 31, 2015
Portfolio Metrics
Properties owned	4,378	4,647
Rentable square feet (in millions)	99.0	102.1
Economic occupancy rate (1)	98.6%	98.4%
Investment-grade tenants (2)	42.1%	42.5%

____________________________________

(1) Economic occupancy rate equals the sum of square feet leased (including space subject to month-to-month agreements) divided by total square feet.

(2) Investment-grade tenants are those with a credit rating of BBB- or higher by Standard & Poor’s Rating Services or a credit rating of Baa3 or higher by Moody’s Investor Service, Inc. The ratings may reflect those assigned by Standard & Poor’s Rating Services or Moody’s Investor Service, Inc. to the lease guarantor or the parent company, as applicable.

The following table shows the economic metrics of our real estate assets, excluding properties owned through our unconsolidated joint ventures, as of March 31, 2016 and 2015:

	March 31, 2016	March 31, 2015
Economic Metrics
Weighted-average lease term (in years) (1)	10.4	11.7
Lease rollover (1)(2):
Annual average	3.9%	3.3%
Maximum for a single year	4.6%	4.2%

____________________________________

(1) Based on annualized rental income of our real estate portfolio as of March 31, 2016.

(2) Through the end of the next five years as of the respective reporting date.

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Operating Performance

In addition, management uses the following financial metrics of our business segments to assess our operating performance (dollars in thousands, except per share amounts).

	Three Months Ended March 31,
	2016			2015
Financial Metrics
REI Segment
Revenues	$	337,787		$	366,474
Operating (loss) income	$	(60,804	)	$	91,171
Net loss	$	(115,534	)	$	(30,607	)
Funds from operations attributable to common stockholders and limited partners (“FFO”) (1)	$	196,775		$	195,116
Adjusted funds from operations attributable to common stockholders and limited partners (“AFFO”) (1)	$	185,528		$	195,073
AFFO per diluted share (1)	$	0.20		$	0.21
Cole Capital Segment
Revenues	$	31,233		$	27,494
Operating loss	$	(2,349	)	$	(1,085	)
Net loss	$	(546	)	$	(86	)
FFO (1)	$	(546	)	$	(86	)
AFFO (1)	$	7,147		$	5,062
AFFO per diluted share (1)	$	0.01		$	0.01
Consolidated
Revenues	$	369,020		$	393,968
Operating (loss) income	$	(63,153	)	$	90,086
Net loss	$	(116,080	)	$	(30,693	)
FFO (1)	$	196,229		$	195,030
AFFO (1)	$	192,675		$	200,135
AFFO per diluted share (1)	$	0.21		$	0.22

____________________________________

(1) See the “Non-GAAP Measures” section below for descriptions of our non-GAAP measures and reconciliations to the most comparable U.S. GAAP measure.

The following table presents the total assets of the Company, by segment (in thousands):

	Total Assets
	March 31, 2016		December 31, 2015
REI segment	$	16,465,057	$	16,966,729
Cole Capital segment	378,555		439,137
Total	$	16,843,612	$	17,405,866

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Results of Operations

Revenues

The table below sets forth, for the periods presented, certain revenue information and the dollar amount change year over year (dollars in thousands):

	Three Months Ended March 31,
	2016		2015		2016 vs 2015 Increase/(Decrease)
Revenues:
Rental income	$	313,971	$	342,759	$	(28,788	)
Direct financing lease income	569		741		(172		)
Operating expense reimbursements	23,247		22,974		273
Cole Capital revenue:
Offering-related fees and reimbursements	12,391		3,117		9,274
Transaction service fees and reimbursements	2,384		10,260		(7,876		)
Management fees and reimbursements	16,458		14,117		2,341
Total Cole Capital revenue	31,233		27,494		3,739
Total revenues	$	369,020	$	393,968	$	(24,948	)

Rental Income

2016 vs 2015 – The decrease in rental income during the three months ended March 31, 2016 as compared to the same period in 2015 was primarily due to the disposition of 286 consolidated properties subsequent to January 1, 2015.

Cole Capital Revenue

Cole Capital’s results of operations are influenced by capital raised on behalf of the Cole REITs in offerings as well as the timing and extent of real estate asset acquisitions and assets under management, which are driven by the Cole REITs’ capital raised, cash flows provided by operations and available proceeds from debt financing.

Offering-Related Fees and Reimbursements

Offering-related fees and reimbursementsinclude selling commissions, dealer manager fees and distribution fees earned from selling securities in the Cole REITs. The Company reallows 100% of selling commissions and may reallow all or a portion of our dealer manager and distribution fees to participating broker-dealers as a marketing and due diligence expense reimbursement, based on factors such as the volume of shares sold by such participating broker-dealers and the amount of marketing support provided by such participating broker-dealers. The following table represents offering-related fees and reimbursements as well as amounts reallowed for the three months ended March 31, 2016 and 2015 (in thousands).

	Three Months Ended March 31,
	2016		2015		2016 vs 2015 Increase/(Decrease)
Offering-related fees and commissions	$	9,681	$	2,491	$	7,190
Offering-related reimbursements	2,710		626		2,084
Less: reallowed fees and commissions	8,068		2,031		6,037
Offering-related fees and reimbursements, net of reallowed	$	4,323	$	1,086	$	3,237

The net increase in offering-related fees and reimbursements of $3.2 million for the three months ended March 31, 2016 was a direct result of a $114.8 million increase in capital raise as compared to the same period in 2015, during which time certain selling agreements for the Cole REITs in their offering stages were suspended, as a result of the Audit Committee Investigation, defined in “Note 2 –Summary of Significant Accounting Policies” to our consolidated financial statements. The increase in capital raise was due to new broker-dealer relationships, as well as certain broker-dealers lifting the suspension of their selling agreements.

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Transaction Service Fees and Reimbursements

Transaction service fees and reimbursementrevenue consist primarily of acquisition and disposition fees earned from acquiring and selling properties on behalf of the Cole REITs and other real estate programs. Transaction service fees were $1.7 million for the three months ended March 31, 2016 as compared to $9.7 million during the same period in 2015. Transaction-related reimbursement revenues were $0.7 million for the three months ended March 31, 2016, as compared to $0.6 million during the same period in 2015. The net decrease of $7.9 million for the three months ended March 31, 2016 was primarily due to a decrease in disposition fee revenue as the Company received $4.4 million relating to the Cole Corporate Income Trust, Inc. disposition in the first quarter of 2015.

Management Fees and Reimbursements

Management fees and reimbursementrevenue represents advisory, asset and property management fees for operating, leasing and managing the portfolios of the Cole REITs and other real estate programs. Management fees were $12.3 million for the three months ended March 31, 2016 as compared to $11.6 million during the same period in 2015. Management reimbursement revenues were $4.1 million for the three months ended March 31, 2016, as compared to $2.5 million during the same period in 2015. The increase in reimbursements was primarily related to an increase in reimbursement revenue as the Company was no longer waiving certain expenses incurred with respect to the Cole REITs.

Operating Expenses

The table below sets forth, for the periods presented, certain operating expense information and the dollar amount change year over year (dollars in thousands):

	Three Months Ended March 31,					Change
	2016			2015		2016 vs 2015 Increase/(Decrease)
Operating expenses:
Cole Capital reallowed fees and commissions	$	8,068		$	2,031	$	6,037
Acquisition related expenses	242			2,182		(1,940		)
Litigation and other non-routine costs, net of insurance recoveries	(5,175		)	16,423		(21,598		)
Property operating expenses	34,813			30,999		3,814
General and administrative expenses	29,400			33,106		(3,706		)
Depreciation and amortization expenses	204,308			219,141		(14,833		)
Impairments	160,517			—		160,517
Total operating expenses	$	432,173		$	303,882	$	128,291

Acquisition Related Expenses

Acquisition related expenses primarily consisted of legal, deed transfer and other costs related to real estate purchase transactions, including costs incurred for deals that were not consummated. The Company acquired an interest in one commercial property for a purchase price of $20.0 million during the three months ended March 31, 2016 as compared with the acquisition of 10 properties for an aggregate purchase price of $7.6 million during the three months ended March 31, 2015. The decrease in acquisition related expenses during the three months ended March 31, 2016 as compared to the same period in 2015 relates to $0.5 million in costs incurred related to unconsummated deals in 2015 as well as a decrease in acquisition activity.

Litigation and other non-routine costs, net of insurance recoveries

The decrease was primarily related to receiving $10.0 million of insurance recoveries during the three months ended March 31, 2016, compared to none received in the same period in 2015. Additionally, costs incurred for the Audit Committee Investigation and related litigation and investigations decreased by $10.6 million, as discussed in “Note 2 –Summary of Significant Accounting Policies” to our consolidated financial statements.

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Property Operating Expenses and Operating Expense Reimbursement

The table below sets forth, for the periods presented, the property operating expenses, net of operating expense reimbursements, and the dollar amount change year over year (dollars in thousands):

	Three Months Ended March 31,				Change
	2016		2015		2016 vs 2015 Increase/(Decrease)
Property operating expenses	$	34,813	$	30,999	$	3,814
Less: Operating expense reimbursements	23,247		22,974		273
Property operating expenses, net of operating expense reimbursements	$	11,566	$	8,025	$	3,541

Property operating expenses such as taxes, insurance, ground rent and maintenance include both reimbursable and non-reimbursable property expenses. Operating expense reimbursement revenue represents reimbursements for such costs that are reimbursable by the tenants per their respective leases. The net increase of $3.5 million for the three months ended March 31, 2016 as compared to the same period in 2015 was primarily due to an increase of $2.8 million of expense related to annual reconciliations with tenants of their reimbursable expenses.

General and Administrative Expenses

The decrease was primarily due to a decrease of $2.6 million in consulting fees, primarily related to the Audit Committee Investigation and the resulting restatements. Additionally, accounting fees decreased $1.0 million, primarily due to additional work due to the restatements during the three months ended March 31, 2015.

Depreciation and Amortization Expenses

The decrease primarily related to the disposition of 286 consolidated properties subsequent to January 1, 2015. The Company also recorded $91.8 million of impairment charges on real estate investments during 2015, which reduced the basis being depreciated and amortized.

Impairments

The increase in impairments was due to recording $160.5 million of impairment charges on real estate investments during the three months ended March 31, 2016, primarily due to management identifying certain properties for potential sale as part of its portfolio management strategy to reduce exposure to office properties, as well as a tenant of 59 restaurant properties filing for bankruptcy during the three months ended March 31, 2016.

Other (expense) income and income tax provision

The table below sets forth, for the periods presented, certain financial information and the dollar amount change year over year (dollars in thousands):

	Three Months Ended March 31,						Change
	2016			2015			2016 vs 2015 Increase/(Decrease)
Other (expense) income and tax benefit (provision):
Interest expense	$	(80,426	)	$	(95,699	)	$	(15,273	)
Gain on extinguishment and forgiveness of debt, net	$	—		$	5,302		$	(5,302	)
Other income, net	$	1,062		$	4,060		$	(2,998	)
Equity in income and gain on disposition of unconsolidated entities	$	10,404		$	28		$	10,376
Loss on derivative instruments, net	$	(1,086	)	$	(1,028	)	$	58
Gain (loss) on disposition of real estate, net	$	17,175		$	(31,368	)	$	48,543
Provision for income taxes	$	(56	)	$	(2,074	)	$	(2,018	)

Interest Expense

The decrease in interest expense during the three months ended March 31, 2016 was primarily a result of a decrease in the total outstanding debt balance from $10.3 billion as of March 31, 2015 to $7.8 billion as of March 31, 2016, largely due to reducing the outstanding balance on the revolving credit facility as well as secured debt with proceeds from property dispositions.

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Gain on Extinguishment and Forgiveness of Debt, Net

During the three months ended March 31, 2015, the Company recorded a gain on forgiveness of debt of $4.9 million in relation to the foreclosure of a vacant office building. Additionally, the Company recorded a gain of $0.4 million related to the write-off of a debt premium relating to a loan that was repaid prior to maturity. No such gains were recorded in 2016.

Other Income, Net

The decrease in other income, net as compared to the same period in 2015 was primarily a result of a legal settlement of $1.2 million received during the three months ended March 31, 2015. Other income, net during the three months ended March 31, 2016 largely consisted of interest income, primarily from investment securities.

Equity in Income and Gain on Disposition of Unconsolidated Entities

The increase is primarily due to a gain of $10.2 million related to the disposition of one property owned by an unconsolidated joint venture.

Loss on Derivative Instruments, Net

This line item relates to the ineffective portion of changes in fair value of cash flow hedges. There is no significant change as compared with the same period in 2015.

Gain (loss) on Disposition of Real Estate, Net

During the three months ended March 31, 2016, the Company disposed of 58 consolidated properties for an aggregate sales price of $193.7 million and a recorded a gain of $18.8 million related to the sales, which included $11.3 million of goodwill allocated in the cost basis of such properties, as compared to the disposal of 11 properties for $271.8 million during the same period in 2015 for a loss of $31.4 million, including $23.7 million of goodwill allocation.

Provision for Income Taxes

The provision for income taxes of $0.1 million for the three months ended March 31, 2016 reflected a decrease of $2.0 million from a provision of $2.1 million during the same period in 2015. The decreased provision primarily related to a decrease in book loss in the taxable REIT subsidiary of the Cole Capital segment.

Non-GAAP Measures

Our results are presented in accordance with U.S. GAAP. We also disclose certain non-GAAP measures, as discussed further below. Management uses these non-GAAP financial measures in our internal analysis of results and believes these measures are useful to investors for the reasons explained below. These non-GAAP financial measures should not be considered as substitutes for any measures derived in accordance with U.S. GAAP.

Funds from Operations and Adjusted Funds from Operations

Due to certain unique operating characteristics of real estate companies, as discussed below, the National Association of Real Estate Investment Trusts, Inc. (“NAREIT”), an industry trade group, has promulgated a measure known as FFO, which we believe to be an appropriate supplemental measure to reflect the operating performance of a REIT. The use of FFO, a non-GAAP supplemental financial performance measure, is recommended by the REIT industry as a supplemental performance measure. FFO is not equivalent to our net income or loss as determined under U.S. GAAP.

NAREIT defines FFO as net income or loss computed in accordance with U.S. GAAP, excluding gains or losses from disposition of property, depreciation and amortization of real estate assets and impairment write-downs on real estate including the pro rata share of adjustments for unconsolidated partnerships and joint ventures. Our FFO calculation complies with NAREIT’s policy described above.

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In addition to FFO, we use AFFO as a non-GAAP supplemental financial performance measure to evaluate the operating performance of the Company. AFFO, as defined by the Company, excludes from FFO non-routine items such as acquisition related costs, litigation and other non-routine transactions costs, gains or losses on sale of investment securities or mortgage notes receivable, insurance recoveries and legal settlements. We also exclude certain non-cash items such as impairments of goodwill or intangible assets, straight-line rental revenue, unrealized gains or losses on derivatives, reserves for loan loss, gains or losses on the extinguishment or forgiveness of debt, non-current portion of the tax benefit or expense, equity-based compensation, amortization of intangible assets, deferred financing costs, above-market lease assets and below-market lease liabilities. Management believes that excluding these costs from FFO provides investors with supplemental performance information that is consistent with the performance models and analysis used by management, and provides investors a view of the performance of our portfolio over time. AFFO allows for a comparison of the performance of our operations with other traded REITs, as AFFO, or an equivalent measure, is routinely reported by traded REITs, and we believe often used by analysts and investors for comparison purposes.

For all of these reasons, we believe FFO and AFFO, in addition to net income (loss) and cash flows from operating activities, as defined by U.S. GAAP, are helpful supplemental performance measures and useful in understanding the various ways in which our management evaluates the performance of the Company over time. However, not all REITs calculate FFO and AFFO the same way, so comparisons with other REITs may not be meaningful. FFO and AFFO should not be considered as alternatives to net income (loss) or to cash flows from operating activities, and are not intended to be used as a liquidity measure indicative of cash flow available to fund our cash needs.

AFFO may provide investors with a view of our future performance. However, because AFFO excludes items that are an important component in an analysis of the historical performance of a property, AFFO should not be construed as a historic performance measure. Neither the SEC, NAREIT, nor any other regulatory body has evaluated the acceptability of the exclusions used to adjust FFO in order to calculate AFFO and its use as a non-GAAP financial performance measure.

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The table below presents FFO and AFFO for the three months ended March 31, 2016 and 2015 (in thousands, except share and per share data).

	Three Months Ended March 31,
Consolidated	2016			2015
Net loss	$	(116,080	)	$	(30,693	)
Dividends on non-convertible preferred stock	(17,973		)	(17,973		)
(Gain) loss on real estate assets and interest in joint venture, net	(27,373		)	31,368
Depreciation and amortization of real estate assets	195,991			210,770
Impairment of real estate	160,517			—
Proportionate share of adjustments for unconsolidated entities	1,147			1,558
FFO attributable to common stockholders and limited partners	196,229			195,030
Acquisition related	242			2,182
Litigation and other non-routine costs, net of insurance recoveries	(5,175		)	16,423
Legal settlements	—			(1,250		)
Gain on investment securities	—			(233		)
Loss on derivative instruments, net	1,086			1,028
Amortization of premiums and discounts on debt and investments, net	(4,426		)	(3,858		)
Amortization of below-market lease liabilities, net of above-market lease assets	1,296			1,007
Net direct financing lease adjustments	559			495
Amortization and write-off of deferred financing costs	7,307			7,929
Amortization of management contracts	7,451			7,510
Deferred tax benefit (1)	(1,457		)	(3,972		)
Gain on extinguishment and forgiveness of debt, net	—			(5,302		)
Straight-line rent, net of bad debt expense related to straight-line rent	(13,045		)	(19,107		)
Equity-based compensation	1,730			818
Other amortization and non-cash charges	743			753
Proportionate share of adjustments for unconsolidated entities	135			682
AFFO attributable to common stockholders and limited partners	$	192,675		$	200,135
Weighted-average shares of common stock outstanding - basic	903,825,726			902,996,270
Effect of dilutive securities (2)	26,354,148			26,157,663
Weighted-average shares of common stock outstanding - diluted (3)	930,179,874			929,153,933
AFFO attributable to common stockholders and limited partners per diluted share	$	0.21		$	0.22

____________________________________

(1) This adjustment represents the non-current portion of the tax benefit recognized in net loss in order to show only the current portion of the benefit as an impact to AFFO.

(2) Dilutive securities include OP Units, unvested restricted shares of common stock, certain unvested restricted stock units and convertible preferred stock, as applicable.

(3) Weighted-average shares for all periods presented exclude the effect of the convertible debt as the Company would expect to settle the debt with cash.

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The table below presents FFO and AFFO for the REI segment for the three months ended March 31, 2016 and 2015 (in thousands, except share and per share data).

	Three Months Ended March 31,
REI segment:	2016			2015
Net loss	$	(115,534	)	$	(30,607	)
Dividends on non-convertible preferred stock	(17,973		)	(17,973		)
(Gain) loss on real estate assets and interest in joint venture, net	(27,373		)	31,368
Depreciation and amortization of real estate assets	195,991			210,770
Impairment of real estate	160,517			—
Proportionate share of adjustments for unconsolidated entities	1,147			1,558
FFO attributable to common stockholders and limited partners	196,775			195,116
Acquisition related	217			1,723
Litigation and other non-routine costs, net of insurance recoveries	(5,175		)	16,423
Legal settlements	—			(1,250		)
Unrealized gain on investment securities	—			(233		)
Loss on derivative instruments, net	1,086			1,028
Amortization of premiums and discounts on debt and investments, net	(4,426		)	(3,858		)
Amortization of below-market lease liabilities, net of amortization of above-market lease assets	1,296			1,007
Net direct financing lease adjustments	559			495
Amortization and write-off of deferred financing costs	7,307			7,929
Loss on extinguishment of debt and forgiveness of debt, net	—			(5,302		)
Straight-line rent, net of bad debt expense related to straight-line rent	(13,045		)	(19,107		)
Equity-based compensation	799			402
Other amortization and non-cash charges	—			18
Proportionate share of adjustments for unconsolidated entities	135			682
AFFO attributable to common stockholders and limited partners	$	185,528		$	195,073
Weighted-average shares of common stock outstanding - basic	903,825,726			902,996,270
Effect of dilutive securities (1)	26,354,148			26,157,663
Weighted-average shares of common stock outstanding - diluted (2)	930,179,874			929,153,933
AFFO attributable to common stockholders and limited partners per diluted share	$	0.20		$	0.21

____________________________________

(1) Dilutive securities include OP Units, unvested restricted shares of common stock, certain unvested restricted stock units and convertible preferred stock, as applicable.

(2) Weighted-average shares for all periods presented exclude the effect of the convertible debt as the Company would expect to settle the debt with cash.

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The table below presents FFO and AFFO for the Cole Capital segment for the three months ended March 31, 2016 and 2015 (in thousands, except share and per share data).

	Three Months Ended March 31,
Cole Capital segment:	2016			2015
Net loss	$	(546	)	$	(86	)
FFO attributable to common stockholders and limited partners	(546		)	(86		)
Acquisition related	25			459
Amortization of Management Contracts	7,451			7,510
Deferred tax benefit (1)	(1,457		)	(3,972		)
Equity-based compensation	931			416
Other amortization and non-cash charges	743			735
AFFO attributable to common stockholders and limited partners	$	7,147		$	5,062
Weighted-average shares of common stock outstanding - basic	903,825,726			902,996,270
Effect of dilutive securities (2)	26,354,148			26,157,663
Weighted-average shares of common stock outstanding - diluted (3)	930,179,874			929,153,933
AFFO attributable to common stockholders and limited partners per diluted share	$	0.01		$	0.01

_________________________________

(1) This adjustment represents the non-current portion of the tax benefit recognized in net loss in order to show only the current portion of the benefit or provision as an impact to AFFO.

(2) Dilutive securities include limited partnership interests in the Operating Partnership, unvested restricted shares of common stock, certain unvested restricted stock units and convertible preferred stock, as applicable.

(3) Weighted-average shares for all periods presented exclude the effect of the convertible debt as the Company would expect to settle the debt with cash.

Liquidity and Capital Resources

In the normal course of business, our principal demands for funds will be for the reduction of the outstanding balance of our Credit Facility and the payment of operating expenses, including legal expenses, distributions to our investors, and for the payment of principal and interest on our other outstanding indebtedness. We expect that our cash needs will be satisfied by proceeds from dispositions and cash flow from operations. If we are unable to satisfy our operating costs with our cash flow from operations, we may use borrowings on our Credit Facility to cover such obligations, as necessary.

As of March 31, 2016, we had $104.5 million of cash and cash equivalents.

Sources of Funds

Capital Markets

A primary source of liquidity for the Company has historically been the debt and equity capital markets, as discussed in “Note 10 –Debt” and “Note 15 – Equity” to our consolidated financial statements. However, our access to capital and terms of future financings have been adversely affected by our credit rating downgrade and loss of eligibility to register the offer and sale of our securities on a registration statement on Form S-3. We regained this eligibility in April 2016. As circumstances warrant, we may issue equity or debt from time to time on an opportunistic basis, dependent upon market conditions and available pricing.

Credit Facility

Availability of Funds

We, as guarantor, and the Operating Partnership, as borrower, are parties to the Credit Facility with Wells Fargo, National Association, as administrative agent, and the other lenders party thereto.

The Credit Facility allows for maximum borrowings of $3.3 billion, consisting of a $1.0 billion term loan facility and a $2.3 billion revolving credit facility. The Credit Facility includes an accordion feature, which, if exercised in full, allows the Company to increase the aggregate commitments under the Credit Facility to $4.7 billion, subject to the receipt of such additional commitments and the satisfaction of certain customary conditions. As of March 31, 2016, a maximum of $2.0 billion was available to the Operating Partnership for future borrowings, subject to borrowing availability.

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Disposition Activity

As part of our effort to optimize our real estate portfolio by focusing on holding core assets, during the three months ended March 31, 2016, we disposed of 58 properties and one property owned by an unconsolidated joint venture for an aggregate sales price of $307.2 million, of which our share was $295.2 million based on our ownership interest in the joint venture, resulting in consolidated proceeds of $176.1 million after disposition fees and debt assumptions. As of March 31, 2016, we also had 19 properties classified as held for sale, for which we recorded a loss of $1.7 million. We expect to continue to explore opportunities to sell additional properties as we pay off outstanding debt and reduce our borrowings under the Credit Facility, which will reduce our overall leverage and provide us further financial flexibility.

Principal Use of Funds

During the next 12 months, we expect that our cash requirements will include (i) paying distributions to our stockholders; (ii) making scheduled principal and interest payments on our Senior Notes, Convertible Notes (defined below), mortgage notes payable and other debt (as more fully described below) and our Credit Facility; and (iii) paying legal expenses, as well as other normal recurring operating expenses.

Credit Facility

Summary and Obligations

As of March 31, 2016, our outstanding balance under the Credit Facility was $1.3 billion, following our net repayment of amounts under the revolving portion of the Credit Facility during the three months ended March 31, 2016 of $180.0 million. Of the outstanding balance under the Credit Facility, $265.0 million bore a floating interest rate of 2.24% at March 31, 2016. The remaining outstanding balance on the Credit Facility of $1.0 billion is fixed through the use of derivative instruments used to hedge interest rate volatility. Including the spread, which can vary based on our credit rating, the interest rate on this portion was 3.29% at March 31, 2016.

Th revolving credit facility generally bears interest at an annual rate of London Inter-Bank Offer Rate (“LIBOR”) plus 1.00% to 1.80% or Base Rate plus 0.00% to 0.80% (based upon our then current credit rating). “Base Rate” is defined as the highest of the prime rate, the federal funds rate plus 0.50% or a floating rate based on one month LIBOR, determined on a daily basis. The term loan facility generally bears interest at an annual rate of LIBOR plus 1.15% to 2.05%, or Base Rate plus 0.15% to 1.05% (based upon our then current credit rating). In addition, the Credit Agreement provides the flexibility for interest rate auctions, pursuant to which, at the Company’s election, the Company may request that lenders make competitive bids to provide revolving loans, which competitive bids may be at pricing levels that differ from the foregoing interest rates.

The Credit Agreement provides for monthly interest payments under the Credit Facility. In the event of default, at the election of a majority of the lenders (or automatically upon a bankruptcy event of default with respect to the OP or the General Partner), the commitments of the lenders under the Credit Facility will mature, and payment of any unpaid amounts in respect of the Credit Facility will be accelerated. The revolving credit facility and the term loan facility both terminate on June 30, 2018, in each case, unless extended in accordance with the terms of the Credit Agreement. The Credit Agreement provides for a one-year extension option with respect to each of the revolving credit facility and the term loan facility, exercisable at the Company’s election and subject to certain customary conditions, as well as certain customary “amend and extend” provisions. At any time, upon timely notice by the OP and subject to any breakage fees, the OP may prepay borrowings under the Credit Facility (subject to certain limitations applicable to the prepayment of any loans obtained through an interest rate auction, as described above). The OP incurs a fee equal to 0.15% to 0.25% per annum (based upon the General Partner’s then current credit rating) multiplied by the commitments (whether or not utilized) in respect of the revolving credit facility. In addition, the OP incurs customary administrative agent, letter of credit issuance, letter of credit fronting, extension and other fees.

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Credit Facility Covenants

The Credit Facility requires restrictions on corporate guarantees, as well as the maintenance of certain financial covenants. The key financial covenants in the Credit Facility, as defined and calculated per the terms of the Credit Agreement include maintaining the following:

Unsecured Credit Facility Key Covenants	Required
Minimum tangible net worth	≥ $5.5 B
Ratio of total indebtedness to total asset value	≤ 60%
Ratio of adjusted EBITDA to fixed charges	≥ 1.5x
Ratio of secured indebtedness to total asset value	≤ 45%
Ratio of unsecured indebtedness to unencumbered asset value	≤ 60%
Ratio of unencumbered adjusted NOI to unsecured interest expense	≥ 1.75x
Minimum unencumbered asset value	≥ $8.0 B

For the purposes of determining unencumbered asset value, the Company is permitted to include restaurant properties representing more than 30% of its unencumbered asset value in such calculation such that: (i) from July 1, 2015 to June 29, 2016, up to 40% of the unencumbered asset value may be comprised of restaurant properties; and (ii) from June 30, 2016 to December 30, 2016, up to 35% of the unencumbered asset value may be comprised of restaurant properties. From December 31, 2016 on, the maximum percentage of unencumbered asset value attributable to restaurant properties will be reduced back down to 30%.

The Company believes that it was in compliance with the Credit Agreement and is not restricted from accessing any borrowings under the Credit Facility as of March 31, 2016.

Corporate Bonds

Summary and Obligations

On February 6, 2014, the Operating Partnership issued, in a private offering, $2.55 billion aggregate principal amount of senior unsecured notes consisting of $1.3 billion aggregate principal amount of 2.00% senior notes due 2017 (the “2017 Notes”), $750.0 million aggregate principal amount of 3.00% senior notes due 2019 (the “2019 Notes”) and $500.0 million aggregate principal amount of 4.60% senior notes due 2024 (the “2024 Notes” and, together with the 2017 Notes and the 2019 Notes, the “Senior Notes”). The Senior Notes are guaranteed by the General Partner.

Bond Covenants

The indenture governing the Senior Notes requires that the Company be in compliance with certain key financial covenants, including maintaining the following:

Corporate Bond Key Covenants	Required
Limitation on incurrence of total debt	≤ 65%
Limitation on incurrence of secured debt	≤ 40%
Debt service coverage ratio	≥ 1.5x
Maintenance of total unencumbered assets	≥ 150%

There were no changes to the covenants or interest rates of our Senior Notes during the three months ended March 31, 2016. As of March 31, 2016, the Company believes that it was in compliance with these covenants based on the covenant limits and calculations in place at that time.

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Convertible Debt

Summary and Obligations

On July 29, 2013, the Company issued $300.0 million aggregate principal amount of convertible senior notes due 2018 (the “2018 Convertible Notes”) and, pursuant to an over-allotment exercise by the underwriters of such 2018 Convertible Notes offering, issued an additional $10.0 million aggregate principal amount of its 2018 Convertible Notes on August 1, 2013. On December 10, 2013, the Company issued an additional $287.5 million of the 2018 Convertible Notes through a reopening of the indenture governing the 2018 Convertible Notes. Also on December 10, 2013, the Company issued $402.5 million aggregate principal amount of convertible senior notes due 2020 (the “2020 Convertible Notes and together with the 2018 Convertible Notes, the “Convertible Notes”). The 2018 Convertible Notes have a weighted average interest rate of 3.00%, a conversion rate of 60.5997 and mature on August 1, 2018 and the 2020 Convertible Notes have a weighted average interest rate of 3.75%, a conversion rate of 66.7249 and mature on December 15, 2020. The Convertible Notes are convertible into cash or shares of the Company’s common stock at the Company’s option. There were no changes to the terms of our Convertible Notes during the three months ended March 31, 2016.

Mortgage Notes Payable and Other Debt

Summary and Obligations

As of March 31, 2016, we had non-recourse mortgage indebtedness of $3.0 billion, which was collateralized by 652 properties, reflecting a decrease from December 31, 2015 of $72.8 million derived primarily from our disposition activity during the three months ended March 31, 2016. Our mortgage indebtedness bore interest at the weighted-average rate of 5.09% per annum and had a weighted-average maturity of 4.9 years. We may in the future incur additional mortgage debt on the properties we currently own or use long-term non-recourse financing to acquire additional properties.

The payment terms of our loan obligations vary. In general, only interest amounts are payable monthly with all unpaid principal and interest due at maturity. Some of our loan agreements require that we comply with specific reporting and financial covenants mainly related to debt coverage ratios and loan-to-value ratios. Each loan that has these requirements has specific ratio thresholds that must be met. As of March 31, 2016, the Company believes that it was in compliance with the debt covenants under its respective loan agreements, except for a loan in default with a principal balance of $38.1 million that is described below.

On March 6, 2015, the Company received a notice of default from the lender of a non-recourse loan, which had an outstanding balance of $38.1 million as of March 31, 2016, due to the Company’s election not to make a reserve payment required per the loan agreement. Due to the default, the Company is currently accruing interest at the default rate of interest of 10.68% per annum. The Company is engaged with the servicer to complete foreclosure proceedings. The default on the loan did not result in a cross default on our other indebtedness.

Restrictions on Loan Covenants

Our mortgage loan obligations generally restrict corporate guarantees and require the maintenance of financial covenants, including maintenance of certain financial ratios (such as specified debt to equity and debt service coverage ratios), as well as the maintenance of a minimum net worth. The mortgage loan agreements contain no dividend restrictions except in the event of default or when a distribution would drive liquidity below the applicable thresholds. At March 31, 2016, the Company believes that it was in compliance with the debt covenants under the mortgage loan agreements, except for a loan in default as described above and in “Note 10 –Debt” to our consolidated financial statements.

Other Debt

Availability of Funds

As of March 31, 2016, the Company had a secured term loan from KBC Bank, N.V. with an outstanding principal balance of $29.3 million and remaining unamortized premium of $0.2 million (the “Secured Term Loan”). The interest coupon on the Secured Term Loan is fixed at 5.81% annually until its maturity in January 2018. The Secured Term Loan is non-recourse to the Company, subject to limited non-recourse exceptions. The Secured Term Loan provides for monthly payments of both principal and interest. The scheduled principal repayments subsequent to March 31, 2016 are $8.3 million, $7.7 million and $13.3 million for the years ended December 31, 2016, 2017 and 2018, respectively.

Dividends

On February 23, 2016, the Board of Directors authorized, and the Company declared, a quarterly dividend of $0.1375 per share of common stock for the first quarter of 2016 (representing an annualized dividend rate of $0.55 per share), which was paid on April 15, 2016 to holders of record as of March 31, 2016.

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Our Series F Preferred Stock, as discussed in “Note 15 – Equity” to our consolidated financial statements, will pay cumulative cash dividends at the rate of 6.70% per annum on their liquidation preference of $25.00 per share (equivalent to $1.675 per share on an annual basis). As of March 31, 2016, there were approximately 42.8 million shares of Series F Preferred Stock(and approximately 42.8 million corresponding Series F Preferred Units that were issued to the General Partner) and 86,874 Limited Partner Series F Preferred Units that were issued and outstanding.

Contractual Obligations

The following is a summary of our contractual obligations as of March 31, 2016 (in thousands):

	Total		Less than 1 year		1-3 years		4-5 years		More than 5 years
Principal payments - mortgage notes and other debt	$	2,996,602	$	468,607	$	458,619	$	495,488	$	1,573,888
Interest payments - mortgage notes and other debt (1) (2)	697,226		141,508		225,932		186,588		143,198
Principal payments - Credit Facility	1,280,000		—		1,280,000		—		—
Interest payments - Credit Facility (1) (2)	90,760		40,191		50,569		—		—
Principal payments - corporate bonds	2,550,000		1,300,000		750,000		—		500,000
Interest payments - corporate bonds	266,577		67,528		87,563		46,000		65,486
Principal payments - convertible debt	1,000,000		—		597,500		402,500		—
Interest payments - convertible debt	112,850		33,019		54,088		25,743		—
Operating and ground lease commitments	328,806		14,452		38,519		37,098		238,737
Build-to-suit commitments	4,563		4,563		—		—		—
Total	$	9,327,384	$	2,069,868	$	3,542,790	$	1,193,417	$	2,521,309

____________________________________

(1) As of March 31, 2016, we had $247.9 million of variable rate mortgage notes and $1.0 billion of variable rate debt on the Credit Facility effectively fixed through the use of interest rate swap agreements. We used the effective interest rates fixed under our swap agreements to calculate the debt payment obligations in future periods.

(2) Interest payments due in future periods on the $0.3 million of variable rate debt payment obligations were calculated using a forward LIBOR curve.

Cash Flow Analysis

Operating Activities –The level of cash flows provided by operating activities is affected by the timing of interest payments, acquisition and transaction costs, as well as the receipt of scheduled rent payments. During the three months ended March 31, 2016, net cash provided by operating activities decreased$51.5 million to $178.6 million from $230.1 million during the same period in 2015. The decrease was primarily due to a decrease in rental receipts due to the disposition of 286 consolidated properties and two unconsolidated joint ventures subsequent to January 1, 2015. Additionally, the decrease is due to an increase in payments of accrued expenses in 2016 primarily due to the payment of an annual bonus as well as an estimated tax payment for the TRS.

Investing Activities –Net cash provided by investing activities for the three months ended March 31, 2016decreased$18.7 million to $201.4 million from $220.1 million during the same period in 2015. The decrease in cash flow primarily related to a decrease in cash proceeds from the disposition of real estate assets of $69.4 million due to higher debt repayments and assumptions in 2016. The decrease was partially offset by the receipt of $50.0 million on the Affiliate Lines of Credit.

Financing Activities –Net cash used in financing activities increased$266.4 million to $344.6 million during the three months ended March 31, 2016 from $78.2 million during the same period in 2015. The increase was primarily related to an increase in net payments on the Credit Facility of $180.0 million, as well as an increase in distributions paid of $124.0 million.These increases were partially offset by a decrease of $37.4 million relating to payments on mortgage notes payable and other debt.

Election as a REIT

The General Partner elected to be taxed as a REIT for U.S. federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code commencing with the taxable year ended December 31, 2011. As a REIT, except as discussed below, the General Partner generally is not subject to federal income tax on taxable income that it distributes to its stockholders so long as it distributes at least 90% of its annual taxable income (computed without regard to the deduction for dividends paid and excluding net capital gains). REITs are subject to a number of other organizational and operational requirements. Even if the General Partner maintains its qualification for taxation as a REIT, it may be subject to certain state and local taxes on its income and property, federal income taxes on certain income and excise taxes on its undistributed income. We believe we are organized and operating in such a manner as to qualify to be taxed as a REIT for the taxable year ended December 31, 2016.

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The Operating Partnership is classified as a partnership for U.S. federal income tax purposes. As a partnership, the Operating Partnership is not a taxable entity for U.S. federal income tax purposes. Instead, each partner in the Operating Partnership is required to take into account its allocable share of the Operating Partnership’s income, gains, losses, deductions and credits for each taxable year. However, the Operating Partnership may be subject to certain state and local taxes on its income and property. Under the LPA, the Operating Partnership is required to conduct business in such a manner as to permit the General partner at all times to qualify as a REIT.

The Company conducts substantially all of its Cole Capital segment business activities through a TRS. A TRS is a subsidiary of a REIT that is subject to corporate federal, state and local income taxes, as applicable. The Company’s use of a TRS enables it to engage in certain business activities while complying with the REIT qualification requirements and to retain any income generated by these businesses for reinvestment without the requirement to distribute those earnings. The Company conducts all of its business in the United States and Canada and, as a result, it files income tax returns in the U.S. federal jurisdiction, the Canadian federal jurisdiction and various state and local jurisdictions. Certain of the Company’s inter-company transactions that have been eliminated in consolidation for financial accounting purposes are also subject to taxation.

Inflation

We may be adversely impacted by inflation on any leases that do not contain indexed escalation provisions. However, net leases that require the tenant to pay its allocable share of operating expenses, including common area maintenance costs, real estate taxes and insurance, may reduce our exposure to increases in costs and operating expenses resulting from inflation.

Related Party Transactions and Agreements

There have been no related party transactions to report during the three months ended March 31, 2016 aside from those with the Cole REITs, as further described below.

We are contractually responsible for managing the Cole REITs’ affairs on a day-to-day basis, identifying and making acquisitions and investments on the Cole REITs’ behalf, and recommending to each of the Cole REIT’s respective board of directors an approach for providing investors with liquidity. In addition, we distribute the shares of common stock for certain of the Cole REITs and advise them regarding offerings, manage relationships with participating broker-dealers and financial advisors, and provide assistance in connection with compliance matters relating to the offerings. We receive compensation and reimbursement for services relating to the Cole REITs’ offerings and the investment, management and disposition of their respective assets, as applicable. See “Note 17 –Related Party Transactions and Arrangements” to our consolidated financial statements in this report for a further explanation of the various related party transactions, agreements and fees.

Off-Balance Sheet Arrangements

We have no material off-balance sheet arrangements that have had or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Critical Accounting Policies and Significant Accounting Estimates

Our accounting policies have been established to conform with U.S. GAAP. The preparation of financial statements in conformity with U.S. GAAP requires us to use judgment in the application of accounting policies, including making estimates and assumptions. These judgments affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Management believes 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. If our judgment or interpretation of the facts and circumstances relating to the various transactions had been different, it is possible that different accounting policies would have been applied, thus resulting in a different presentation of the financial statements. Additionally, other companies may utilize different estimates that may impact comparability of our results of operations to those of companies in similar businesses. We believe the following critical accounting policies govern the significant judgments and estimates used in the preparation of our financial statements, which should be read in conjunction with the more complete discussion of our accounting policies and procedures included in our Annual Report on Form 10-K for the year ended December 31, 2015:

•Goodwill Impairment;

•Intangible Asset Impairment;

•Real Estate Investment Impairment;

•Mortgage Note Receivables Impairment;

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•Program Development Costs;

•Consolidation of Equity Investments;

•Allocation of Purchase Price of Business Combinations including Acquired Properties; and

•Income Taxes.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Market Risk

The market risk associated with financial instruments and derivative financial instruments is the risk of loss from adverse changes in market prices or interest rates. Our market risk arises primarily from interest rate risk relating to variable-rate borrowings. To meet our short and long-term liquidity requirements, we borrow funds at a combination of fixed and variable rates. Our interest rate risk management objectives are to limit the impact of interest rate changes in earnings and cash flows and to manage our overall borrowing costs. To achieve these objectives, from time to time, we may enter into interest rate hedge contracts such as swaps, collars and treasury lock agreements in order to mitigate our interest rate risk with respect to various debt instruments. We would not hold or issue these derivative contracts for trading or speculative purposes. We have limited operations in Canada and thus, are not exposed to material foreign currency fluctuations.

Interest Rate Risk

As of March 31, 2016, our debt included fixed-rate debt, including debt that has interest rates that are fixed with the use of derivative instruments, with a fair value and carrying value of $7.7 billion and $7.6 billion, respectively. Changes in market interest rates on our fixed rate debt impact fair value of the debt, but they have no impact on interest incurred or cash flow. For instance, if interest rates rise 100 basis points and the fixed rate debt balance remains constant, we expect the fair value of our debt to decrease, the same way the price of a bond declines as interest rates rise. The sensitivity analysis related to our fixed-rate debt assumes an immediate 100 basis point move in interest rates from their March 31, 2016 levels, with all other variables held constant. A 100 basis point increase in market interest rates would result in a decrease in the fair value of our fixed rate debt of $199.9 million. A 100 basis point decrease in market interest rates would result in an increase in the fair value of our fixed-rate debt of $227.6 million.

As of March 31, 2016, our debt included variable-rate debt with an aggregate fair value and carrying value of $0.3 billion each. The sensitivity analysis related to our variable-rate debt assumes an immediate 100 basis point move in interest rates from their March 31, 2016 levels, with all other variables held constant. A 100 basis point increase or decrease in variable interest rates on our variable-rate notes payable would increase or decrease our interest expense by $2.7 million annually.

As the information presented above includes only those exposures that existed as of March 31, 2016, it does not consider exposures or positions arising after that date. The information presented herein has limited predictive value. Future actual realized gains or losses with respect to interest rate fluctuations will depend on cumulative exposures, hedging strategies employed and the magnitude of the fluctuations.

These amounts were determined by considering the impact of hypothetical interest rate changes on our borrowing costs and assume no other changes in our capital structure.

Credit Risk

Concentrations of credit risk arise when a number of tenants are engaged in similar business activities, or activities in the same geographic region, or have similar economic features that would cause their ability to meet contractual obligations, including those to the Company, to be similarly affected by changes in economic conditions. The Company is subject to tenant, geographic and industry concentrations. Any downturn of the economic conditions in one or more of these tenants, states or industries could result in a material reduction of our cash flows or material losses to us.

The factors considered in determining the credit risk of our tenants include, but are not limited to: payment history; credit status and change in status (credit ratings for public companies are used as a primary metric); change in tenant space needs (i.e., expansion/downsize); tenant financial performance; economic conditions in a specific geographic region; and industry specific credit considerations. We believe that the credit risk of our portfolio is reduced by the high quality of our existing tenant base, reviews of prospective tenants’ risk profiles prior to lease execution and consistent monitoring of our portfolio to identify potential problem tenants.

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Item 4. Controls and Procedures.

I. Discussion of Controls and Procedures of the General Partner

For purposes of the discussion in this Part I of Item 4, the “Company” refers to the General Partner.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to provide reasonable assurance thatinformation required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, we recognize that no controls and procedures, no matter how well designed and operated, can provide absolute assurance of achieving the desired control objectives.

In accordance with Rules 13a-15(b) and 15d-15(b) of the Exchange Act, management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of our disclosure controls and procedures as of March 31, 2016 and determined that the disclosure controls and procedures were effective at a reasonable assurance level as of that date.

Changes in Internal Control over Financial Reporting

There were no changes to our internal control over financial reporting that occurred during the three months ended March 31, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. 

II. Discussion of Controls and Procedures of the Operating Partnership

In the information incorporated by reference into this Part II of Item 4, the term “Company” refers to the Operating Partnership, except as the context otherwise requires.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act that are designed to provide reasonable assurance thatinformation required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, we recognize that no controls and procedures, no matter how well designed and operated, can provide absolute assurance of achieving the desired control objectives.

In accordance with Rules 13a-15(b) and 15d-15(b) of the Exchange Act, management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of our disclosure controls and procedures as of March 31, 2016 and determined that the disclosure controls and procedures were effective at a reasonable assurance level as of that date.

Changes in Internal Control over Financial Reporting

There were no changes to our internal control over financial reporting that occurred during the three months ended March 31, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. 

70

PART II — OTHER INFORMATION

Item 1. Legal Proceedings.

The information contained under the heading “Litigation” in “Note 14 –Commitments and Contingencies” to our consolidated financial statements is incorporated by reference into this Part II, Item 1. Except as set forth therein, as of the end of the period covered by this Quarterly Report on Form 10-Q, we are not a party to, and none of our properties are subject to, any material pending legal proceedings.

Item 1A. Risk Factors.

There have been no material changes from the risk factors set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits

The exhibits listed in the Exhibit Index (following the signatures section of this report) are included in, or incorporated by reference into, this Quarterly Report on Form 10-Q.

71

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, each registrant has duly caused this Quarterly Report on Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.

VEREIT, INC.
By:	/s/ Michael J. Bartolotta
Michael J. Bartolotta
Executive Vice President and Chief Financial Officer (Principal Financial Officer)

VEREIT OPERATING PARTNERSHIP, L.P.
By: VEREIT, Inc., its sole general partner
By:	/s/ Michael J. Bartolotta
Michael J. Bartolotta
Executive Vice President and Chief Financial Officer (Principal Financial Officer)

Dated: May 4, 2016

72

Exhibit Index

The following exhibits are included in this Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 (and are numbered in accordance with Item 601 of Regulation S-K):

Exhibit No.	Description
3.1 (1)	Articles of Amendment and Restatement of VEREIT, Inc.
3.2 (2)	Articles Supplementary Relating to the Series A Convertible Preferred Stock of VEREIT, Inc., dated May 10, 2012.
3.3 (3)	Articles Supplementary Relating to the Series B Convertible Preferred Stock of VEREIT, Inc., dated July 24, 2012.
3.4 (4)	Articles Supplementary for the Series C Convertible Preferred Stock of VEREIT, Inc., dated June 6, 2013.
3.5 (5)	Articles of Amendment to Articles of Amendment and Restatement of VEREIT, Inc., effective July 2, 2013.
3.6 (6)	Articles Supplementary for the Series D Cumulative Convertible Preferred Stock of VEREIT, Inc., filed November 8, 2013.
3.7 (7)	Articles of Amendment to Articles of Amendment and Restatement of VEREIT, Inc., effective December 9, 2013.
3.8 (8)	Articles Supplementary Relating to the 6.70% Series F Cumulative Redeemable Preferred Stock of VEREIT, Inc., dated January 2, 2014.
3.9 (9)	Articles of Amendment to Articles of Amendment and Restatement of VEREIT, Inc., dated July 28, 2015.
3.10 (10)	Articles Supplementary to Articles of Amendment and Restatement of VEREIT, Inc., dated August 5, 2015
3.11 (11)	Amended and Restated bylaws of VEREIT, Inc., effective as of January 1, 2016.
3.12 (12)	Certificate of Limited Partnership of VEREIT Operating Partnership, L.P.
3.13 (10)	Amendment to Certificate of Limited Partnership of VEREIT Operating Partnership, L.P., effective July 28, 2015.
4.1 (13)	Third Amended and Restated Agreement of Limited Partnership of VEREIT Operating Partnership, L.P., effective January 3, 2014.
4.2 (10)	First Amendment to Third Amended and Restated Agreement of Limited Partnership of VEREIT Operating Partnership, L.P., dated January 26, 2015.
4.3 (10)	Second Amendment to Third Amended and Restated Agreement of Limited Partnership of VEREIT Operating Partnership, L.P., dated July 28, 2015.
4.4 (14)	Indenture, dated as of July 29, 2013, between American Realty Capital Properties, Inc. and U.S. Bank National Association, as trustee.
4.5 (14)	First Supplemental Indenture, dated as of July 29, 2013, between American Realty Capital Properties, Inc. and U.S. Bank National Association, as trustee.
4.6 (15)	Form of 3.00% Convertible Senior Notes due 2018.
4.7 (15)	Second Supplemental Indenture, dated as of December 10, 2013, between American Realty Capital Properties, Inc. and U.S. Bank National Association, as trustee.
4.8 (15)	Form of 3.75% Convertible Senior Notes due 2020.
4.9 (16)	Indenture, dated as of February 6, 2014, among ARC Properties Operating Partnership, L.P., Clark Acquisition, LLC, the guarantors named therein and U.S. Bank National Association, as trustee.
4.10 (16)	Officers’ Certificate, dated as of February 6, 2014.
4.11 (16)	Registration Rights Agreement, dated as of February 6, 2014, among ARC Properties Operating Partnership, L.P., Clark Acquisition, LLC, the guarantors named therein, Barclays Capital Inc. and Citigroup Global Markets Inc.
31.1*	Certification of the Chief Executive Officer of VEREIT, Inc. pursuant to Securities Exchange Act Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of the Chief Financial Officer of VEREIT, Inc. pursuant to Securities Exchange Act Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.3*	Certification of the Chief Executive Officer of VEREIT, Inc., the sole general partner of VEREIT Operating Partnership, L.P., pursuant to Securities Exchange Act Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.4*	Certification of the Chief Financial Officer of VEREIT, Inc., the sole general partner of VEREIT Operating Partnership, L.P., pursuant to Securities Exchange Act Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Written statements of the Chief Executive Officer of VEREIT, Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Written statements of the Chief Financial Officer of VEREIT, Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.3*	Written statements of the Chief Executive Officer of VEREIT, Inc., the sole general partner of VEREIT Operating Partnership, L.P., pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.4*	Written statements of the Chief Financial Officer of VEREIT, Inc., the sole general partner of VEREIT Operating Partnership, L.P., pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

73

Exhibit No.	Description
101.INS*	XBRL Instance Document.
101.SCH*	XBRL Taxonomy Extension Schema Document.
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document.

_____________________________

* Filed herewith

(1) Previously filed with the Pre-Effective Amendment No. 5 to Form S-11 Registration Statement (Registration No. 333-172205) filed with the SEC on July 5, 2011.

(2) Previously filed with the Current Report on Form 8-K filed with the SEC on May 15, 2012.

(3) Previously filed with the Current Report on Form 8-K filed with the SEC on July 30, 2012.

(4) Previously filed with the Current Report on Form 8-K filed with the SEC on June 12, 2013.

(5) Previously filed with the Current Report on Form 8-K filed with the SEC on July 9, 2013.

(6) Previously filed with the Current Report on Form 8-K filed with the SEC on November 15, 2013.

(7) Previously filed with the Amended Current Report on Form 8-K/A filed with the SEC on December 20, 2013.

(8) Previously filed with the Registration Statement on Form 8-A filed with the SEC on January 3, 2014.

(9) Previously filed with the Current Report on Form 8-K filed with the SEC on July 28, 2015.

(10) Previously filed with the Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 filed with the SEC on August 6, 2015.

(11) Previously filed with the Quarterly Report on Form 10-Q for the quarter ended September 30, 2015 filed with the SEC on November 5, 2015.

(12) Previously filed with the Registration Statement on Form S-4 (Registration No. 333-197780-01) filed with the SEC on August 1, 2014.

(13) Previously filed with the Amendment No. 2 to its Annual Report on Form 10-K/A for the year ended December 31, 2013 filed with the SEC on March 2, 2015.

(14) Previously filed with the Current Report on Form 8-K filed with the SEC on July 29, 2013.

(15) Previously filed with the Current Report on Form 8-K filed with the SEC on December 11, 2013.

(16) Previously filed with the Current Report on Form 8-K filed with the SEC on February 7, 2014.

74

EX-31.1

Exhibit 31.1

VEREIT, INC.

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO RULES 13a-14(a) AND 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Glenn J. Rufrano, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of VEREIT, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 4, 2016	/s/ Glenn J. Rufrano
		Glenn J. Rufrano
		Chief Executive Officer
		(Principal Executive Officer)

EX-31.2

Exhibit 31.2

VEREIT, INC.

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO RULES 13a-14(a) AND 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael J. Bartolotta, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of VEREIT, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 4, 2016	/s/ Michael J. Bartolotta
		Michael J. Bartolotta Executive Vice President and Chief Financial Officer
		(Principal Financial Officer)

EX-31.3

Exhibit 31.3

VEREIT OPERATING PARTNERSHIP, L.P.

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO RULES 13a-14(a) AND 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Glenn J. Rufrano, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of VEREIT Operating Partnership, L.P.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 4, 2016	/s/ Glenn J. Rufrano
		Glenn J. Rufrano
		Chief Executive Officer of VEREIT, Inc., the sole general partner
		of VEREIT Operating Partnership, L.P.
		(Principal Executive Officer)

EX-31.4

Exhibit 31.4

VEREIT OPERATING PARTNERSHIP, L.P.

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO RULES 13a-14(a) AND 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael J. Bartolotta, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of VEREIT Operating Partnership, L.P.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 4, 2016	/s/ Michael J. Bartolotta
		Michael J. Bartolotta Executive Vice President and Chief Financial Officer of
		VEREIT, Inc., the sole general partner of VEREIT Operating Partnership, L.P.
		(Principal Financial Officer)

EX-32.1

Exhibit 32.1

VEREIT, INC.

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of VEREIT, Inc. (the “Company”) for the period ended March 31, 2016 (the “Report”), I, Glenn J. Rufrano, Chief Executive Officer of the Company, certify to my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	May 4, 2016	/s/ Glenn J. Rufrano
		Glenn J. Rufrano
		Chief Executive Officer
		(Principal Executive Officer)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

VEREIT, INC.

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of VEREIT, Inc. (the “Company”) for the period ended March 31, 2016 (the “Report”), I, Michael J. Bartolotta, Executive Vice President and Chief Financial Officer of the Company, certify to my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	May 4, 2016	/s/ Michael J. Bartolotta
		Michael J. Bartolotta Executive Vice President and Chief Financial Officer
		(Principal Financial Officer)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.3

Exhibit 32.3

VEREIT OPERATING PARTNERSHIP, L.P.

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of VEREIT Operating Partnership, L.P. (the “Company”) for the period ended March 31, 2016 (the “Report”), I, Glenn J. Rufrano, Chief Executive Officer of VEREIT, Inc., the sole general partner of the Company, certify to my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	May 4, 2016	/s/ Glenn J. Rufrano
		Glenn J. Rufrano
		Chief Executive Officer of VEREIT, Inc., the sole general partner
		of VEREIT Operating Partnership, L.P.
		(Principal Executive Officer)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.4

Exhibit 32.4

VEREIT OPERATING PARTNERSHIP, L.P.

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of VEREIT Operating Partnership, L.P. (the “Company”) for the period ended March 31, 2016 (the “Report”), I, Michael J. Bartolotta, Executive Vice President and Chief Financial Officer of VEREIT, Inc., the sole general partner of the Company, certify to my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	May 4, 2016	/s/ Michael J. Bartolotta
		Michael J. Bartolotta Executive Vice President and Chief Financial Officer of
		VEREIT Inc., the sole general partner of VEREIT Operating Partnership, L.P.
		(Principal Financial Officer)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2016	May. 03, 2016
Entity Information [Line Items]
Entity Registrant Name	VEREIT, Inc.
Entity Central Index Key	0001507385
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Mar. 31, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		904,842,650
Entity Current Reporting Status	Yes
VEREIT Operating Partnership, L.P. [Member]
Entity Information [Line Items]
Entity Registrant Name	VEREIT Operating Partnership, L.P.
Entity Central Index Key	0001528059
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-Q
Document Period End Date	Mar. 31, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		0
Entity Current Reporting Status	Yes

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Real estate investments, at cost:
Land	$ 3,058,879	$ 3,120,653
Buildings, fixtures and improvements	11,161,327	11,445,690
Intangible lease assets	2,145,734	2,218,378
Total real estate investments, at cost	16,365,940	16,784,721
Less: accumulated depreciation and amortization	1,865,674	1,778,597
Total real estate investments, net	14,500,266	15,006,124
Investment in unconsolidated entities	23,445	56,824
Investment in direct financing leases, net	45,611	46,312
Investment securities, at fair value	48,162	53,304
Mortgage notes receivable, net	23,559	24,238
Cash and cash equivalents	104,450	69,103
Restricted cash	60,132	59,767
Intangible assets, net	43,327	50,779
Rent and tenant receivables and other assets, net	313,903	303,637
Goodwill	1,642,858	1,656,374
Due from affiliates	11,617	60,633
Real estate assets held for sale, net	26,282	18,771
Total assets	16,843,612	17,405,866
LIABILITIES AND STOCKHOLDERS’ EQUITY
Mortgage notes payable and other debt, net	3,029,666	3,111,985
Corporate bonds, net	2,537,699	2,536,333
Convertible debt, net	965,469	962,894
Credit facility, net	1,269,731	1,448,590
Below-market lease liabilities, net	245,093	251,692
Accounts payable and accrued expenses	118,970	151,877
Deferred rent, derivative and other liabilities	88,997	87,490
Distributions payable	143,973	140,816
Due to affiliates	0	230
Total liabilities	$ 8,399,598	$ 8,691,907
Commitments and contingencies
STOCKHOLDERS’ EQUITY
Preferred stock	$ 428	$ 428
Common stock	9,048	9,049
Additional paid-in-capital	11,932,859	11,931,768
Accumulated other comprehensive loss	(11,345)	(2,025)
Accumulated deficit	(3,671,050)	(3,415,233)
Total stockholders’ equity	8,259,940	8,523,987
Non-controlling interests	184,074	189,972
Total equity	8,444,014	8,713,959
Total liabilities and equity	16,843,612	17,405,866
VEREIT Operating Partnership, L.P. [Member]
Real estate investments, at cost:
Land	3,058,879	3,120,653
Buildings, fixtures and improvements	11,161,327	11,445,690
Intangible lease assets	2,145,734	2,218,378
Total real estate investments, at cost	16,365,940	16,784,721
Less: accumulated depreciation and amortization	1,865,674	1,778,597
Total real estate investments, net	14,500,266	15,006,124
Investment in unconsolidated entities	23,445	56,824
Investment in direct financing leases, net	45,611	46,312
Investment securities, at fair value	48,162	53,304
Mortgage notes receivable, net	23,559	24,238
Cash and cash equivalents	104,450	69,103
Restricted cash	60,132	59,767
Intangible assets, net	43,327	50,779
Rent and tenant receivables and other assets, net	313,903	303,637
Goodwill	1,642,858	1,656,374
Due from affiliates	11,617	60,633
Real estate assets held for sale, net	26,282	18,771
Total assets	16,843,612	17,405,866
LIABILITIES AND STOCKHOLDERS’ EQUITY
Mortgage notes payable and other debt, net	3,029,666	3,111,985
Corporate bonds, net	2,537,699	2,536,333
Convertible debt, net	965,469	962,894
Credit facility, net	1,269,731	1,448,590
Below-market lease liabilities, net	245,093	251,692
Accounts payable and accrued expenses	118,970	151,877
Deferred rent, derivative and other liabilities	88,997	87,490
Distributions payable	143,973	140,816
Due to affiliates	0	230
Total liabilities	$ 8,399,598	$ 8,691,907
Commitments and contingencies
STOCKHOLDERS’ EQUITY
Total partners’ equity	$ 8,441,551	$ 8,712,102
Non-controlling interests	2,463	1,857
Total equity	8,444,014	8,713,959
Total liabilities and equity	16,843,612	17,405,866
VEREIT Operating Partnership, L.P. [Member] | Preferred Units [Member]
STOCKHOLDERS’ EQUITY
General partners' capital account	907,632	925,569
Limited partners' capital account	3,279	3,315
VEREIT Operating Partnership, L.P. [Member] | Common Stock [Member]
STOCKHOLDERS’ EQUITY
General partners' capital account	7,352,308	7,598,418
Limited partners' capital account	$ 178,332	$ 184,800

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2016	Dec. 31, 2015
Convertible preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Convertible preferred stock, shares authorized (shares)	100,000,000	100,000,000
Convertible preferred stock, shares issued (shares)	42,834,138	42,834,138
Convertible preferred stock, shares outstanding (shares)	42,834,138	42,834,138
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (shares)	1,500,000,000	1,500,000,000
Common stock, shares issued (shares)	904,757,365	904,884,394
Common stock, shares outstanding (shares)	904,757,365	904,884,394
VEREIT Operating Partnership, L.P. [Member] | Preferred Units [Member]
General partners', units issued (shares)	42,834,138	42,834,138
General partners', units outstanding (shares)	42,834,138	42,834,138
Limited partners', units issued (shares)	86,874	86,874
Limited partners', units outstanding (shares)	86,874	86,874
VEREIT Operating Partnership, L.P. [Member] | Common Stock [Member]
General partners', units issued (shares)	904,757,365	904,884,394
General partners', units outstanding (shares)	904,757,365	904,884,394
Limited partners', units issued (shares)	23,763,797	23,763,797
Limited partners', units outstanding (shares)	23,763,797	23,763,797

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CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2016	Mar. 31, 2015
Revenues:
Rental income		$ 313,971	$ 342,759
Direct financing lease income		569	741
Operating expense reimbursements		23,247	22,974
Cole Capital revenue		31,233	27,494
Total revenues		369,020	393,968
Operating expenses:
Cole Capital reallowed fees and commissions		8,068	2,031
Acquisition related		242	2,182
Litigation and other non-routine costs, net of insurance recoveries		(5,175)	16,423
Property operating		34,813	30,999
General and administrative		29,400	33,106
Depreciation and amortization		204,308	219,141
Impairments		160,517	0
Total operating expenses		432,173	303,882
Operating (loss) income		(63,153)	90,086
Other (expense) income:
Interest expense		(80,426)	(95,699)
Gain on extinguishment and forgiveness of debt, net		0	5,302
Other income, net		1,062	4,060
Equity in income and gain on disposition of unconsolidated entities		10,404	28
Loss on derivative instruments, net		(1,086)	(1,028)
Total other expenses, net		(70,046)	(87,337)
(Loss) income before taxes and real estate dispositions		(133,199)	2,749
Gain (loss) on disposition of real estate, net		17,175	(31,368)
Loss before taxes		(116,024)	(28,619)
Provision for income taxes		(56)	(2,074)
Net loss		(116,080)	(30,693)
Net loss (income) attributable to non-controlling interests	[1]	2,994	723
Net loss attributable to the General Partner / OP		$ (113,086)	$ (29,970)
Basic and diluted net loss per share attributable to common stockholders (in dollars per share)		$ (0.15)	$ (0.05)
Distributions declared per common share / unit (in dollars per share)		$ 0.14	$ 0
VEREIT Operating Partnership, L.P. [Member]
Revenues:
Rental income		$ 313,971	$ 342,759
Direct financing lease income		569	741
Operating expense reimbursements		23,247	22,974
Cole Capital revenue		31,233	27,494
Total revenues		369,020	393,968
Operating expenses:
Cole Capital reallowed fees and commissions		8,068	2,031
Acquisition related		242	2,182
Litigation and other non-routine costs, net of insurance recoveries		(5,175)	16,423
Property operating		34,813	30,999
General and administrative		29,400	33,106
Depreciation and amortization		204,308	219,141
Impairments		160,517	0
Total operating expenses		432,173	303,882
Operating (loss) income		(63,153)	90,086
Other (expense) income:
Interest expense		(80,426)	(95,699)
Gain on extinguishment and forgiveness of debt, net		0	5,302
Other income, net		1,062	4,060
Equity in income and gain on disposition of unconsolidated entities		10,404	28
Loss on derivative instruments, net		(1,086)	(1,028)
Total other expenses, net		(70,046)	(87,337)
(Loss) income before taxes and real estate dispositions		(133,199)	2,749
Gain (loss) on disposition of real estate, net		17,175	(31,368)
Loss before taxes		(116,024)	(28,619)
Provision for income taxes		(56)	(2,074)
Net loss		(116,080)	(30,693)
Net loss (income) attributable to non-controlling interests	[2]	39	(180)
Net loss attributable to the General Partner / OP		$ (116,041)	$ (30,873)
Basic and diluted net loss per unit attributable to common unitholders (in dollars per share)		$ (0.15)	$ (0.05)
Distributions declared per common share / unit (in dollars per share)		$ 0.14	$ 0

[1] Represents loss attributable to limited partners and consolidated joint venture partners.

[2] Represents loss (income) attributable to consolidated joint venture partners.

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2016	Mar. 31, 2015
Net loss		$ (116,080)	$ (30,693)
Other comprehensive loss:
Unrealized loss on interest rate derivatives		(9,702)	(10,396)
Amount of loss reclassified from accumulated other comprehensive loss into net loss as interest expense		2,099	2,736
Unrealized (loss) gain on investment securities, net		(1,961)	796
Total other comprehensive loss		(9,564)	(6,864)
Total comprehensive loss		(125,644)	(37,557)
Comprehensive (income) loss attributable to non-controlling interests	[1]	3,238	723
Total comprehensive loss attributable to the General Partner / OP		(122,406)	(36,834)
VEREIT Operating Partnership, L.P. [Member]
Net loss		(116,080)	(30,693)
Other comprehensive loss:
Unrealized loss on interest rate derivatives		(9,702)	(10,396)
Amount of loss reclassified from accumulated other comprehensive loss into net loss as interest expense		2,099	2,736
Unrealized (loss) gain on investment securities, net		(1,961)	796
Total other comprehensive loss		(9,564)	(6,864)
Total comprehensive loss		(125,644)	(37,557)
Comprehensive (income) loss attributable to non-controlling interests	[2]	39	(180)
Total comprehensive loss attributable to the General Partner / OP		$ (125,605)	$ (37,737)

[1] Represents loss attributable to limited partners and consolidated joint venture partners.

[2] Represents loss attributable to consolidated joint venture partners.

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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands	Total	Series D Preferred Stock [Member]	Preferred Stock [Member]	Total Stockholders' Equity	Total Stockholders' Equity Series D Preferred Stock [Member]	Total Stockholders' Equity Preferred Stock [Member]	Preferred Stock [Member]	Common Stock [Member]	Additional Paid-In Capital [Member]	Accumulated Other Comprehensive Income [Member]	Accumulated Deficit [Member]	Accumulated Deficit [Member] Series D Preferred Stock [Member]	Accumulated Deficit [Member] Preferred Stock [Member]	Non-Controlling Interests [Member]
Beginning balance (shares) at Dec. 31, 2014							42,834,138	905,530,431
Beginning balance at Dec. 31, 2014	$ 9,382,330			$ 9,153,888			$ 428	$ 9,055	$ 11,920,253	$ 2,728	$ (2,778,576)			$ 228,442
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock repurchases (shares)								(132,826)
Common stock repurchases	(1,207)			(1,207)				$ (1)	(1,206)
Equity-based compensation, net (shares)								(262,886)
Equity-based compensation, net	818			818				$ (3)	821
Tax shortfall from equity-based compensation	(510)			(510)					(510)
Distributions to non-controlling interest holders	(464)													(464)
Distributions		$ (5)	$ (17,973)		$ (5)	$ (17,973)						$ (5)	$ (17,973)
Net loss	(30,693)			(29,970)							(29,970)			(723)
Other comprehensive loss	(6,864)			(6,864)						(6,864)
Ending balance (shares) at Mar. 31, 2015							42,834,138	905,134,719
Ending balance at Mar. 31, 2015	9,325,432			9,098,177			$ 428	$ 9,051	11,919,358	(4,136)	(2,826,524)			227,255
Beginning balance (shares) at Dec. 31, 2015							42,834,138	904,884,394
Beginning balance at Dec. 31, 2015	8,713,959			8,523,987			$ 428	$ 9,049	11,931,768	(2,025)	(3,415,233)			189,972
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock repurchases (shares)								(127,741)
Common stock repurchases	(1,024)			(1,024)				$ (1)	(1,023)
Equity-based compensation, net (shares)								712
Equity-based compensation, net	1,730			1,730					1,730
Contributions from non-controlling interest holders	675													675
Distributions declared	(124,285)			(124,285)							(124,285)
Distributions to non-controlling interest holders	(3,299)													(3,299)
Distributions		$ (125)	$ (17,973)		$ (125)	$ (17,937)						$ (125)	$ (17,937)	(36)
Net loss	(116,080)			(113,086)							(113,086)			(2,994)
Other comprehensive loss	(9,564)			(9,320)						(9,320)				(244)
Ending balance (shares) at Mar. 31, 2016							42,834,138	904,757,365
Ending balance at Mar. 31, 2016	8,444,014			$ 8,259,940			$ 428	$ 9,048	11,932,859	$ (11,345)	(3,671,050)			$ 184,074
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cumulative-effect adjustment for equity-based compensation forfeitures	$ 0								$ 384		$ (384)

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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - OP - USD ($) $ in Thousands	Total	General Partner [Member]	VEREIT Operating Partnership, L.P. [Member]	VEREIT Operating Partnership, L.P. [Member] Total Partners' Capital [Member]	VEREIT Operating Partnership, L.P. [Member] Preferred Units [Member] General Partner [Member]	VEREIT Operating Partnership, L.P. [Member] Preferred Units [Member] Limited Partner [Member]	VEREIT Operating Partnership, L.P. [Member] Common Units [Member] General Partner [Member]	VEREIT Operating Partnership, L.P. [Member] Common Units [Member] Limited Partner [Member]	VEREIT Operating Partnership, L.P. [Member] Noncontrolling Interest [Member]	VEREIT Operating Partnership, L.P. [Member] Noncontrolling Interest [Member] General Partner [Member]
Beginning balance (shares) at Dec. 31, 2014					42,834,138	86,874	905,530,431	23,763,797
Beginning balance at Dec. 31, 2014			$ 9,382,330	$ 9,358,631	$ 996,987	$ 3,375	$ 8,157,167	$ 201,102	$ 23,699
Increase (Decrease) in Partners' Capital [Roll Forward]
Repurchases of Common OP Units to settle tax obligation (shares)							(132,826)
Repurchases of common OP units to settle tax obligation	$ (1,207)		(1,207)	(1,207)			$ (1,207)
Equity-based compensation, net of forfeitures (shares)							(262,886)
Equity-based compensation, net of forfeitures			818	818			$ 818
Excess tax benefit	(510)		(510)	(510)			(510)
Distributions to Common OP Units and non-controlling interest holders	(464)		(469)	(5)			(5)		(464)
Distributions to Preferred OP Units			(17,973)	(17,973)	$ (17,973)
Net loss	(30,693)		(30,693)	(30,873)			(29,970)	(903)		$ 180
Other comprehensive loss	(6,864)		(6,864)	(6,864)			$ (6,657)	$ (207)
Ending balance (shares) at Mar. 31, 2015					42,834,138	86,874	905,134,719	23,763,797
Ending balance at Mar. 31, 2015			9,325,432	9,302,017	$ 979,014	$ 3,375	$ 8,119,636	$ 199,992	23,415
Beginning balance (shares) at Dec. 31, 2015					42,834,138	86,874	904,884,394	23,763,797
Beginning balance at Dec. 31, 2015			8,713,959	8,712,102	$ 925,569	$ 3,315	$ 7,598,418	$ 184,800	1,857
Increase (Decrease) in Partners' Capital [Roll Forward]
Repurchases of Common OP Units to settle tax obligation (shares)		(127,741)					(127,741)
Repurchases of common OP units to settle tax obligation	(1,024)		(1,024)	(1,024)			$ (1,024)
Equity-based compensation, net of forfeitures (shares)							712
Equity-based compensation, net of forfeitures			1,730	1,730			$ 1,730
Contributions from non-controlling interest holders	675		675						675
Distributions to Common OP Units and non-controlling interest holders	(3,299)		(127,709)	(127,679)			(124,410)	(3,269)	(30)
Distributions to Preferred OP Units			(17,973)	(17,973)	$ (17,937)	$ (36)
Net loss	(116,080)		(116,080)	(116,041)			(113,086)	(2,955)		$ (39)
Other comprehensive loss	$ (9,564)		(9,564)	(9,564)			$ (9,320)	$ (244)
Ending balance (shares) at Mar. 31, 2016					42,834,138	86,874	904,757,365	23,763,797
Ending balance at Mar. 31, 2016			$ 8,444,014	$ 8,441,551	$ 907,632	$ 3,279	$ 7,352,308	$ 178,332	$ 2,463

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CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Cash flows from operating activities:
Net loss	$ (116,080)	$ (30,693)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	208,362	224,111
(Gain) loss on real estate assets and joint venture, net	(27,373)	31,368
Impairments	160,517	0
Equity-based compensation	1,730	818
Equity in income of unconsolidated entities	(206)	(28)
Distributions from unconsolidated entities	1,491	2,866
Loss on derivative instruments	1,086	1,028
(Gain) on investment securities	0	(233)
Gain on extinguishment and forgiveness of debt, net	0	(5,307)
Changes in assets and liabilities:
Investment in direct financing leases	701	495
Rent and tenant receivables and other assets, net	(13,024)	(30,757)
Due from affiliates	(984)	27,665
Accounts payable and accrued expenses	(32,556)	2,013
Deferred rent, derivative and other liabilities	(4,822)	6,798
Due to affiliates	(230)	(12)
Net cash provided by operating activities	178,612	230,132
Cash flows from investing activities:
Investments in real estate assets	(19,952)	(7,627)
Capital expenditures and leasing costs	(5,388)	(3,649)
Real estate developments	(554)	(15,998)
Principal repayments received from borrowers	3,863	3,668
Proceeds from disposition of real estate and joint venture	176,137	245,548
Investment in leasehold improvements and other assets	(574)	0
Deposits for real estate assets	(3,818)	(3,509)
Uses and refunds of deposits for real estate assets	2,019	7,939
Line of credit advances to affiliates	0	(10,000)
Line of credit repayments from affiliates	50,000	10,000
Change in restricted cash	(365)	(6,315)
Net cash provided by investing activities	201,368	220,057
Cash flows from financing activities:
Proceeds from mortgage notes payable	206	1,158
Payments on mortgage notes payable and other debt	21,948	59,308
Proceeds from credit facilities	203,000	0
Payments on credit facilities	(383,000)	0
Payments of deferred financing costs	(240)	(326)
Repurchases of common stock / units to settle tax obligations	(801)	(1,207)
Contributions from non-controlling interest holders	675	0
Distributions paid	(142,525)	(18,478)
Net cash used in financing activities	(344,633)	(78,161)
Net change in cash and cash equivalents	35,347	372,028
Cash and cash equivalents, beginning of period	69,103	416,711
Cash and cash equivalents, end of period	104,450	788,739
VEREIT Operating Partnership, L.P. [Member]
Cash flows from operating activities:
Net loss	(116,080)	(30,693)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	208,362	224,111
(Gain) loss on real estate assets and joint venture, net	(27,373)	31,368
Impairments	160,517	0
Equity-based compensation	1,730	818
Equity in income of unconsolidated entities	(206)	(28)
Distributions from unconsolidated entities	1,491	2,866
Loss on derivative instruments	1,086	1,028
(Gain) on investment securities	0	(233)
Gain on extinguishment and forgiveness of debt, net	0	(5,307)
Changes in assets and liabilities:
Investment in direct financing leases	701	495
Rent and tenant receivables and other assets, net	(13,024)	(30,757)
Due from affiliates	(984)	27,665
Accounts payable and accrued expenses	(32,556)	2,013
Deferred rent, derivative and other liabilities	(4,822)	6,798
Due to affiliates	(230)	(12)
Net cash provided by operating activities	178,612	230,132
Cash flows from investing activities:
Investments in real estate assets	(19,952)	(7,627)
Capital expenditures and leasing costs	(5,388)	(3,649)
Real estate developments	(554)	(15,998)
Principal repayments received from borrowers	3,863	3,668
Proceeds from disposition of real estate and joint venture	176,137	245,548
Investment in leasehold improvements and other assets	(574)	0
Deposits for real estate assets	(3,818)	(3,509)
Uses and refunds of deposits for real estate assets	2,019	7,939
Line of credit advances to affiliates	0	(10,000)
Line of credit repayments from affiliates	50,000	10,000
Change in restricted cash	(365)	(6,315)
Net cash provided by investing activities	201,368	220,057
Cash flows from financing activities:
Proceeds from mortgage notes payable	206	1,158
Payments on mortgage notes payable and other debt	21,948	59,308
Proceeds from credit facilities	203,000	0
Payments on credit facilities	(383,000)	0
Payments of deferred financing costs	(240)	(326)
Repurchases of common stock / units to settle tax obligations	(801)	(1,207)
Contributions from non-controlling interest holders	675	0
Distributions paid	(142,525)	(18,478)
Net cash used in financing activities	(344,633)	(78,161)
Net change in cash and cash equivalents	35,347	372,028
Cash and cash equivalents, beginning of period	69,103	416,711
Cash and cash equivalents, end of period	$ 104,450	$ 788,739

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Organization

3 Months Ended

Mar. 31, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization

Organization

VEREIT, Inc. (the “General Partner” or “VEREIT”), is a Maryland corporation, incorporated on December 2, 2010, that qualified as a real estate investment trust (“REIT”) for U.S. federal income tax purposes beginning in the taxable year ended December 31, 2011. VEREIT Operating Partnership, L.P. (together with its subsidiaries, the “Operating Partnership” or the “OP”), is a Delaware limited partnership of which the General Partner is the sole general partner. VEREIT’s common stock, par value $0.01 per share (“Common Stock”), and its 6.70% Series F Cumulative Redeemable Preferred Stock, par value $0.01 per share (“Series F Preferred Stock”) trade on the New York Stock Exchange (“NYSE”) under the trading symbols, “VER” and “VER PRF,” respectively. As used herein, the terms the “Company,” “we,” “our” and “us” refer to VEREIT, together with its consolidated subsidiaries, including the OP.

The Company is a full-service real estate operating company with investment management capabilities that operates through two reportable segments, its real estate investment (“REI”) segment and its investment management segment, Cole Capital (“Cole Capital”), as further discussed in Note 3 –Segment Reporting. Through the REI segment, the Company owns and actively manages a diversified portfolio of retail, restaurant, office and industrial real estate properties subject to long-term net leases with creditworthy tenants. The Company actively manages its portfolio considering a number of metrics including property type, concentration and key economic factors for appropriate balance and diversity. Through the Cole Capital segment, the Company is responsible for raising capital for and managing the affairs of the Cole REITs (as defined in Note 3 –Segment Reporting) on a day-to-day basis, identifying and making acquisitions and investments on the Cole REITs’ behalf and recommending to the respective board of directors of each of the Cole REITs an approach for providing investors with liquidity. Cole Capital receives compensation and reimbursement for performing these services. To support both reportable segments, the Company employs a shared services model pursuant to which its personnel are integral in providing, among other things, transactional and operational functions to the Company’s owned portfolio and the Cole REITs.

Substantially all of the REI segment’s operations are conducted through the OP. VEREIT is the sole general partner and holder of 97.4% of the common equity interests in the OP as of March 31, 2016 with the remaining 2.6% of the common equity interests owned by unaffiliated investors and certain former directors, officers and employees of ARC Properties Advisors, LLC (the “Former Manager”). Under the limited partnership agreement of the OP, as amended (the “LPA”), after holding units of limited partner interests in the OP (“OP Units”) for a period of one year, unless an earlier redemption is otherwise consented to by VEREIT, holders of OP Units have the right to redeem the OP Units for the cash value of a corresponding number of shares of VEREIT’s Common Stock or, at the option of VEREIT, a corresponding number of shares of VEREIT’s Common Stock. The remaining rights of the holders of OP Units are limited, however, and do not include the ability to replace the General Partner or to approve the sale, purchase or refinancing of the OP’s assets. Substantially all of the Cole Capital segment’s operations are conducted through Cole Capital Advisors, Inc. (“CCA”), an Arizona corporation and a wholly owned subsidiary of the OP. CCA is treated as a taxable REIT subsidiary (“TRS”) under Section 856 of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”).

The actions of the OP and its relationship with the General Partner are governed by the LPA. The General Partner does not have any significant assets other than its investment in the OP. Therefore, the assets and liabilities of the General Partner and the OP are substantially the same. Additionally, pursuant to the LPA, all administrative expenses and expenses associated with the formation, continuity, existence and operation of the General Partner incurred by the General Partner on the OP’s behalf shall be treated as expenses of the OP. Further, when the General Partner issues any equity instrument that has been approved by the General Partner’s board of directors, the LPA requires the OP to issue to the General Partner equity instruments with substantially similar terms, to protect the integrity of the Company’s umbrella partnership REIT structure, pursuant to which each holder of interests in the OP has a proportionate economic interest in the OP reflecting its capital contributions thereto. OP Units issued to the General Partner are referred to as General Partner OP Units. OP Units issued to parties other than the General Partner are referred to as Limited Partner OP Units. The LPA also provides that the OP issue debt with terms and provisions consistent with debt issued by the General Partner. The LPA will be amended to provide for the issuance of any additional class of equivalent equity instruments to the extent the General Partner’s board of directors authorizes the issuance of any new class of equity securities.

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2016

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Basis of Accounting

The consolidated financial statements of the Company presented herein include the accounts of the General Partner and its consolidated subsidiaries, including the OP. All intercompany transactions have been eliminated upon consolidation. The financial statements are prepared on the accrual basis of accounting in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The information furnished includes all adjustments and accruals of a normal recurring nature, which, in the opinion of management, are necessary for a fair presentation of results for the interim periods. The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results for the entire year or any subsequent interim period.

These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of and for the year ended December 31, 2015 of the Company, which are included in the Company’s Annual Report on Form 10-K filed February 24, 2016. There have been no significant changes to the Company’s significant accounting policies during the three months ended March 31, 2016. Information and footnote disclosures normally included in financial statements have been condensed or omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”).

Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of the Company and its subsidiaries and consolidated joint venture arrangements. The portions of the consolidated joint venture arrangements not owned by the Company are presented as non-controlling interests in VEREIT’s and the OP’s consolidated balance sheets, statements of operations, statements of comprehensive income (loss) and statements of changes in equity. In addition, as described in Note 1 – Organization, certain third parties have been issued OP Units. Holders of OP Units are considered to be non-controlling interest holders in the OP and their ownership interest in the limited partner’s share is presented as non-controlling interests in VEREIT’s consolidated balance sheets, statements of operations, statements of comprehensive income (loss) and statements of changes in equity. Further, a portion of the earnings and losses of the OP are allocated to non-controlling interest holders based on their respective ownership percentages. Upon conversion of OP Units to Common Stock, any difference between the fair value of shares of Common Stock issued and the carrying value of the OP Units converted is recorded as a component of equity. As of both March 31, 2016 and December 31, 2015, there were approximately 23.8 million Limited Partner OP Units outstanding.

During the year ended December 31, 2015, the Company early adopted the U.S. Financial Accounting Standards Board (the “FASB”) Accounting Standards Update, (“ASU”) No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis (“ASU 2015-02”), which simplifies consolidation accounting by reducing the number of consolidation models and changing various aspects of current U.S. GAAP, including certain consolidation criteria for a variable interest entity (“VIE”). For legal entities being evaluated for consolidation, the Company must first determine whether the interests that it holds and fees it receives qualify as variable interests in the entity. A variable interest is an investment or other interest that will absorb portions of an entity’s expected losses or receive portions of the entity’s expected residual returns. The Company’s evaluation includes consideration of fees paid to the Company where the Company acts as a decision maker or service provider to the entity being evaluated. If the Company determines that it holds a variable interest in an entity, it evaluates whether that entity is a VIE. VIEs are entities where investors lack sufficient equity at risk for the entity to finance its activities without additional subordinated financial support or where equity investors, as a group, lack one of the following characteristics: (a) the power to direct the activities that most significantly impact the entity’s economic performance, (b) the obligation to absorb the expected losses of the entity, or (c) the right to receive the expected returns of the entity.

The Company then qualitatively assesses whether it is (or is not) the primary beneficiary of a VIE, which is generally defined as the party who has a controlling financial interest in the VIE. Consideration of various factors include, but are not limited to, the Company’s ability to direct the activities that most significantly impact the entity’s economic performance and its obligation to absorb losses from or right to receive benefits of the VIE that could potentially be significant to the VIE. The Company consolidates any VIEs when the Company is determined to be the primary beneficiary of the VIE and the difference between consolidating the VIE and accounting for it using the equity method could be material to the Company’s consolidated financial statements. The Company continually evaluates the need to consolidate these VIEs based on standards set forth in U.S. GAAP as described above.

Reclassification

As described below, the following items previously reported have been reclassified to conform with the current period’s presentation.

The land and construction in progress line item from prior periods has been combined into the land caption in the consolidated balance sheets. The gain on forgiveness of debt previously included in other income, net has been combined into the caption gain on extinguishment and forgiveness of debt, net in the consolidated statements of operations. Additionally, equity in income of unconsolidated joint ventures previously included in other income net, in the consolidated statements of operations has been included in a separate caption entitled equity in income and gain on disposition of unconsolidated entities. Further, the previous gain on investment securities line item has been included in other income, net in the consolidated statements of operations.

Finally, the designated derivatives, fair value adjustments line item from the prior years has been disaggregated within the consolidated statements of other comprehensive loss into the captions unrealized loss on interest rate derivatives and amount of loss reclassified from accumulated other comprehensive loss into net loss as interest expense. These captions were previously included within the notes to consolidated financial statements.

Restricted Cash

The Company had $60.1 million and $59.8 million, respectively, in restricted cash as of March 31, 2016 and December 31, 2015. Restricted cash primarily consists of reserves related to lease expirations, as well as maintenance, structural and debt service reserves. Included in restricted cash at March 31, 2016 was $48.8 million in lender reserves and $11.3 million held in restricted lockbox accounts. Included in restricted cash at December 31, 2015 was $47.9 million in lender reserves and $11.9 million held in restricted lockbox accounts. As part of certain debt agreements, rent from certain of the Company’s tenants is deposited directly into a lockbox account, from which the monthly debt service payments are disbursed to the lender and the excess funds are then disbursed to the Company.

Revenue Recognition – REI

The Company’s revenues, which primarily consist of rental income, include rents that each tenant pays in accordance with the terms of each lease reported on a straight-line basis over the initial non-cancelable term of the lease. When the Company acquires a property, the term of each existing lease is considered to commence as of the acquisition date for the purposes of this calculation. Since many of the leases provide for rental increases at specified intervals, straight-line basis accounting requires the Company to record a receivable, and include in revenues, unbilled rent receivables that the Company will only receive if the tenant makes all rent payments required through the expiration of the initial term of the lease. Straight-line rent receivables are included in rent and tenant receivables and other assets, net, in the consolidated balance sheets. See Note 8 – Rent and Tenant Receivables and Other Assets, Net. Cost recoveries from tenants are included in operating expense reimbursements in the consolidated statements of operations in the period the related costs are incurred. The Company defers the revenue related to lease payments received from tenants in advance of their due dates. As of March 31, 2016 and December 31, 2015, the Company had $67.3 million and $67.2 million, respectively, of deferred rental income, which is included in deferred rent, derivative and other liabilities in the consolidated balance sheets.

The Company continually reviews receivables related to rent and unbilled rent receivables and determines collectability by taking into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. In the event that the collectability of a receivable is uncertain, the Company will record an increase in the allowance for uncollectible accounts in the consolidated balance sheets or record a direct write-off of the receivable in the consolidated statements of operations as a reduction to rental income. As of March 31, 2016 and December 31, 2015, the Company maintained an allowance for uncollectible accounts of $7.9 million and $6.6 million, respectively.

Revenue Recognition – Cole Capital

Revenue consists of securities sales commissions and dealer manager fees, real estate acquisition fees, property management fees, advisory fees, asset management fees and performance fees for services relating to the Cole REITs’ offerings and the investment and management of their respective assets, in accordance with the respective dealer manager and advisory agreements. The Company records revenue related to acquisition fees, securities sales commissions and dealer manager fees upon completion of a transaction and advisory, asset and property management fees as services are performed. The Company also earns property management, asset management and disposition fees from certain joint ventures and other real estate programs. The Company is also reimbursed for certain costs incurred in providing these services. Securities sales commissions and dealer manager reimbursements are recorded as revenue as the expenses are incurred, as long as reimbursement is reasonably assured. The Company, in its sole discretion, may reallow all or a portion of its dealer manager fee to such participating broker-dealers as a marketing and due diligence expense reimbursement, based on factors such as the volume of shares issued by such participating broker-dealers and the amount of marketing support provided by such participating broker-dealers. Refer to Note 17 –Related Party Transactions and Arrangements for further discussion.

Acquisition Related Expenses and Litigation and Other Non-routine Costs

All costs incurred as a result of a business combination are classified as acquisition related expenses or merger and other non-routine transaction related expenses and expensed as incurred. Acquisition related expenses include legal and other transaction related costs incurred in connection with self-originated acquisitions, including purchases of portfolios. In addition, indirect costs, such as internal salaries, that are tracked and documented in a manner that clearly indicates that the activities driving the cost directly relate to activities necessary to complete, or effect, self-originating purchases are classified as acquisition related expenses.

Similar costs incurred in relation to mergers, which are not considered self-originating purchases, and other non-routine transaction related expenses are included in litigation and other non-routine costs, net of insurance recoveries in the consolidated statements of operations. The Company has also incurred legal fees and other costs associated with the Audit Committee Investigation (defined below) and the litigations and investigations resulting therefrom, which are considered non-routine. The Company has directors’ and officers’ insurance and has recovered certain amounts related to such policies.

Litigation and other non-routine transaction related expenses include the following costs (amounts in thousands):

	Three Months Ended March 31,
	2016			2015
Other non-routine transaction related expenses:
Audit Committee Investigation and related matters (1)	$	4,742		$	15,316
Legal fees and expenses (2)	83			475
Other fees and expenses	—			632
Total costs incurred	4,825			16,423
Insurance recoveries	(10,000		)	—
Total	$	(5,175	)	$	16,423

___________________________________

(1) Includes all fees and costs associated with the previously-announced investigation conducted by the audit committee (the “Audit Committee”) of the General Partner’s board of directors (the “Audit Committee Investigation”) and various litigations and investigations prompted by the results of the Audit Committee Investigation, including fees and costs incurred pursuant to the Company’s indemnification obligations.

(2) Includes legal fees and expenses associated with litigation resulting from prior mergers.

Income Taxes

The General Partner currently qualifies and has elected to be taxed as a REIT for U.S. federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code. As a REIT, except as discussed below, the General Partner generally is not subject to federal income tax on taxable income that it distributes to its stockholders so long as it distributes at least 90% of its annual taxable income (computed without regard to the deduction for dividends paid and excluding net capital gains). REITs are subject to a number of other organizational and operational requirements. Even if the General Partner maintains its qualification for taxation as a REIT, it may be subject to certain state and local taxes on its income and property, federal income taxes on certain income and excise taxes on its undistributed income.

The OP is classified as a partnership for U.S. federal income tax purposes. As a partnership, the OP is not a taxable entity for U.S. federal income tax purposes. Instead, each partner in the OP is required to take into account its allocable share of the OP’s income, gains, losses, deductions and credits for each taxable year. However, the OP may be subject to certain state and local taxes on its income and property.

As of March 31, 2016, the OP and the General Partner had no material uncertain income tax positions. The tax years subsequent to and including the fiscal year ended December 31, 2011 remain open to examination by the major taxing jurisdictions to which the OP, the General Partner, American Realty Capital Trust III, Inc. (“ARCT III”), CapLease, Inc. (“CapLease”), American Realty Capital Trust IV, Inc., (“ARCT IV”), Cole Real Estate Investments, Inc. (“Cole”) and Cole Credit Property Trust, Inc. are subject.

Under the LPA, the OP is to conduct business in such a manner as to permit the General Partner at all times to qualify as a REIT.

The Company conducts substantially all of its Cole Capital segment business activities through a TRS. A TRS is a subsidiary of a REIT that is subject to corporate federal, state and local income taxes, as applicable. The Company’s use of a TRS enables it to engage in certain business activities while complying with the REIT qualification requirements and to retain any income generated by these businesses for reinvestment without the requirement to distribute those earnings. The Company conducts all of its business in the United States and Canada and, as a result, it files income tax returns in the U.S. federal jurisdiction, the Canadian federal jurisdiction and various state and local jurisdictions. Certain of the Company’s inter-company transactions that have been eliminated in consolidation for financial accounting purposes are also subject to taxation.

The Company provides for income taxes in accordance with current authoritative accounting and tax guidance. The tax provision or benefit related to significant or unusual items is recognized in the quarter in which those items occur. In addition, the effect of changes in enacted tax laws, rates or tax status is recognized in the quarter in which the change occurs. The accounting estimates used to compute the provision for or benefit from income taxes may change as new events occur, additional information is obtained or the tax environment changes.

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which supersedes the revenue recognition requirements in Revenue Recognition, Accounting Standards Codification (“ASC”) (Topic 605) and requires an entity to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, an amendment to ASU 2014-09, ASU 2015-14, was issued to defer the effective date for all entities by one year. For public business entities, certain not-for-profit entities and certain employee benefit plans, the guidance should be applied to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company is currently evaluating the impact of the new standard on its financial statements.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments(Subtopic 825-10), which requires all equity investments to be measured at fair value with changes in the fair value recognized through net income (other than those accounted for under equity method of accounting or those that result in consolidation of the investee). The amendments in this update also require an entity to present separately in other comprehensive income, the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. In addition, the amendments in this update require separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. The Company is currently evaluating the impact that this new guidance will have on its financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which will require that a lessee recognize assets and liabilities on the balance sheet for all leases with a lease term of more than 12 months, with the result being the recognition of a right of use asset and a lease liability and the disclosure of key information about the entity's leasing arrangements. ASU 2016-02 retains a distinction between finance leases (i.e. capital leases under current U.S. GAAP) and operating leases. The classification criteria for distinguishing between finance leases and operating leases will be substantially similar to the classification criteria for distinguishing between capital leases and operating leases under current U.S. GAAP. The amendments in ASU 2016-02 are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. A modified retrospective approach is required for existing leases that have not expired upon adoption. The Company is currently evaluating the impact this amendment will have on its consolidated financial statements.

In March of 2016, the FASB issued ASU No. 2016-05, Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships (Topic 815). The amendments in this update clarify that a change in the counterparty to a derivative instrument that has been designated as the hedging instrument does not, in and of itself, require de-designation of that hedging relationship provided that all other hedge accounting criteria continue to be met. These provisions are effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact this amendment will have on its consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvement to Employee Share-Based Payment Accounting, which affects entities that issue share-based payment awards to their employees. The ASU is designed to simplify several aspects of accounting for share-based payment award transactions including the income tax consequences, classification of awards as either equity or liabilities, classification on the statement of cash flows and forfeiture rate calculations. The guidance will be effective for annual reporting periods beginning after December 15, 2016 and interim periods within those fiscal years with early adoption permitted. The Company has elected to early adopt this guidance during the first quarter of 2016, which does not have a material effect on the Company’s consolidated financial statements. In connection with the adoption, the Company has modified the consolidated statement of changes in equity to include the line item cumulative-effect adjustment for equity-based compensation forfeitures, which represents application of the accounting change on a modified retrospective basis.

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Segment Reporting

3 Months Ended

Mar. 31, 2016

Segment Reporting [Abstract]

Segment Reporting

Segment Reporting

The Company has two reportable segments as it has organized its operations into two segments for management and internal financial reporting purposes, REI and Cole Capital, as further discussed below.

REI – Through its REI segment, the Company owns and actively manages a diversified portfolio of retail, restaurant, office and industrial real estate properties subject to long-term net leases with creditworthy tenants. As of March 31, 2016, the Company owned 4,378 properties comprising 99.0 million square feet of retail and commercial space located in 49 states, the District of Columbia, Puerto Rico and Canada, which includes properties owned through consolidated joint ventures. The rentable space at these properties was 98.6% leased with a weighted-average remaining lease term of 10.4 years. In addition, as of March 31, 2016, the Company owned nine CMBS and nine mortgage notes receivable.

Cole Capital – Through its Cole Capital segment, the Company is responsible for managing the day-to-day affairs of Cole Credit Property Trust IV, Inc. (“CCPT IV”); Cole Real Estate Income Strategy (Daily NAV), Inc. (“INAV”); Cole Office & Industrial REIT (CCIT II), Inc. (“CCIT II”); Cole Credit Property Trust V, Inc. (“CCPT V”); and other real estate offerings in registration (collectively with CCPT IV, INAV and CCIT II, the “Cole REITs”), raising capital for those Cole REITs still in offering, identifying and making acquisitions and investments on the Cole REITs’ behalf and recommending to the respective board of directors of each of the Cole REITs an approach for providing investors with liquidity. Cole Capital serves as the dealer manager and distributes shares of common stock for certain Cole REITs and advises them regarding offerings, manages relationships with participating broker-dealers and financial advisors and provides assistance in connection with compliance matters relating to the offerings. Cole Capital receives compensation and reimbursement for services relating to the Cole REITs’ offerings and the investment, management, financing and disposition of their respective assets, as applicable. Cole Capital also develops new REIT offerings and assists in obtaining regulatory approvals from the SEC, the Financial Industry Regulatory Authority, Inc. and various blue sky jurisdictions for such offerings. See Note 17 –Related Party Transactions and Arrangements for further discussion on the Cole REITs.

The Company allocates certain operating expenses, such as legal fees, employee related costs and benefits and general overhead expenses between its operating segments. The following tables present a summary of the comparative financial results and total assets for each segment (in thousands):

	Three Months Ended March 31,
	2016			2015
REI segment:
Revenues:
Rental income	$	313,971		$	342,759
Direct financing lease income	569			741
Operating expense reimbursements	23,247			22,974
Total real estate investment revenues	337,787			366,474
Operating expenses:
Acquisition related	217			1,723
Litigation and other non-routine costs, net of insurance recoveries	(5,175		)	16,423
Property operating	34,813			30,999
General and administrative	12,228			15,370
Depreciation and amortization	195,991			210,788
Impairment of real estate	160,517			—
Total operating expenses	398,591			275,303
Operating (loss) income	$	(60,804	)	$	91,171
Other (expense) income:
Interest expense	$	(80,426	)	$	(95,699	)
Gain on extinguishment and forgiveness of debt, net	—			5,302
Other income, net	568			2,841
Equity in income and gain on disposition of unconsolidated entities	10,404			28
Loss on derivative instruments, net	(1,086		)	(1,028		)
Total other expenses, net	(70,540		)	(88,556		)
(Loss) income before taxes and real estate dispositions	(131,344		)	2,615
Gain (loss) on disposition of real estate, net	17,175			(31,368		)
Loss before taxes	(114,169		)	(28,753		)
Provision for income taxes	(1,365		)	(1,854		)
Net loss	$	(115,534	)	$	(30,607	)

	Three Months Ended March 31,
	2016			2015
Cole Capital segment:
Revenues:
Offering-related fees and reimbursements	$	12,391		$	3,117
Transaction service fees and reimbursements	2,384			10,260
Management fees and reimbursements	16,458			14,117
Total Cole Capital revenues	31,233			27,494
Operating expenses:
Cole Capital reallowed fees and commissions	8,068			2,031
Acquisition related	25			459
General and administrative	17,172			17,736
Depreciation and amortization	8,317			8,353
Total operating expenses	33,582			28,579
Operating loss	(2,349		)	(1,085		)
Total other income, net	494			1,219
(Loss) income before taxes	(1,855		)	134
Benefit from (provision for) income taxes	1,309			(220		)
Net loss	$	(546	)	$	(86	)
Total Company:
Total revenues	$	369,020		$	393,968
Total operating expenses	$	432,173		$	303,882
Total other expense, net	$	(70,046	)	$	(87,337	)
Net loss	$	(116,080	)	$	(30,693	)

	Total Assets
	March 31, 2016		December 31, 2015
REI segment	$	16,465,057	$	16,966,729
Cole Capital segment	378,555		439,137
Total Company	$	16,843,612	$	17,405,866

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Goodwill and Other Intangibles

3 Months Ended

Mar. 31, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangibles

Goodwill and Other Intangibles

Goodwill

In connection with prior mergers, the Company recorded goodwill as a result of the merger consideration exceeding the net assets acquired. The goodwill recorded as a result of the merger of Cole with and into a wholly owned subsidiary of the Company (the “Cole Merger”) was allocated between the Company’s two segments, the REI segment and the Cole Capital segment. The REI segment and the Cole Capital segment each comprise one reporting unit.

In the event the Company disposes of a property that constitutes a business under U.S. GAAP, the Company will allocate a portion of the REI segment’s goodwill to that property in determining the gain or loss on the disposal of the property. The amount of goodwill allocated to the property will be based on the relative fair value of the property to the fair value of the REI segment. Future property acquisitions that constitute a business will be integrated into the REI segment and therefore will also be allocated goodwill upon disposition.

The Company evaluates goodwill for impairment annually or more frequently when an event occurs or circumstances change that indicate the carrying value, by reporting unit, may not be recoverable. The analysis for the annual goodwill test is performed during the fourth quarter. The Company tests goodwill for impairment by first comparing the carrying value of net assets to the fair value of each reporting unit. If the fair value is determined to be less than the carrying value or if qualitative factors indicate that it is more likely than not that goodwill is impaired, a second step is performed to compute the amount of impairment as the difference between the fair value of goodwill and the carrying value. The Company estimates the fair value of the reporting units using discounted cash flows and relevant competitor multiples. The evaluation of goodwill for potential impairment requires the Company’s management to exercise significant judgment and to make certain assumptions. While the Company believes its assumptions are reasonable, there are no guarantees as to actual results. Changes in assumptions based on actual results may have a material impact on the Company’s financial results.

The fair values of the Cole Capital segment goodwill is dependent upon actual results, including, but not limited to, the timing and amount of aggregate capital raised and deployed on behalf of the Cole REITs, which is influenced by the Company’s ability to reinstate certain selling agreements that were suspended as a result of the Audit Committee Investigation and the resulting restatements. If the Company is unable to reinstate selling agreements or raise and deploy capital as estimated, the fair values of the Cole Capital segment goodwill and intangible assets may be less than the respective carrying value, resulting in an impairment that could have a material effect on a Company’s financial results. In addition, the actual timing of closing an offering or executing a liquidity event on behalf of a Cole REIT or the commencement of operations of newly formed REITs, which are not yet effective, may differ from the Company’s assumptions used.

During the three months ended March 31, 2016 and 2015, management monitored the actual performance of the business segments relative to the fair value assumptions used during the annual goodwill impairment test. For the periods presented, no events or changes in circumstances were identified where management determined it is more likely than not that the fair value of a reporting unit is less than its carrying value.

The following table summarizes the Company’s goodwill activity by segment during the three months ended March 31, 2016 and 2015 (in thousands):

	REI Segment			Cole Capital Segment		Consolidated
Balance as of December 31, 2015	$	1,410,631		$	245,743	$	1,656,374
Goodwill allocated to dispositions and held for sale assets (1)	(13,516		)	—		$	(13,516	)
Balance as of March 31, 2016	$	1,397,115		$	245,743	$	1,642,858

	REI Segment			Cole Capital Segment		Consolidated
Balance as of December 31, 2014	1,509,396			385,398		1,894,794
Goodwill allocated to dispositions and held for sale assets (1)	(23,680		)	—		(23,680		)
Balance as of March 31, 2015	$	1,485,716		$	385,398	$	1,871,114

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(1) Included in gain (loss) on disposition of real estate, net, in the consolidated statement of operations.

Intangible Assets

The intangible assets primarily consisted of management and advisory contracts that the Company has with certain Cole REITs, which are subject to an estimated useful life of approximately four years.

The Company evaluates intangible assets for impairment when an event occurs or circumstances change that indicate the carrying value may not be recoverable. The Company tests intangible assets for impairment by first comparing the carrying value of the asset group to the undiscounted future cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying value, the Company will adjust the intangible assets to their respective fair values and recognize an impairment loss.

The Company will estimate the fair value of the intangible assets using a discounted cash flow model specific to the applicable Cole REITs. The evaluation of intangible assets for potential impairment requires the Company’s management to exercise significant judgment and to make certain assumptions. While the Company believes its assumptions are reasonable, there are no guarantees as to actual results. Changes in assumptions based on actual results may have a material impact on the Company’s financial results. There were no events or changes in circumstances that indicated that intangible assets were impaired during the three months ended March 31, 2016 or 2015.

The Company recorded $7.5 million of amortization expenses related to the intangible assets for each of the three months ended March 31, 2016 and 2015. The estimated amortization expense is expected to be $18.7 million for the remainder of the year ending December 31, 2016, $16.6 million and $4.0 million for the years ending December 31, 2017 and 2018, respectively, and $3.8 million for the nine months ended September 30, 2019. The intangible assets were $43.3 million and $50.8 million, net of accumulated amortization of $10.9 million and $3.4 million, respectively, as of March 31, 2016 and December 31, 2015.

Intangible Lease Assets and Liabilities

Intangible lease assets and liabilities of the Company consisted of the following as of March 31, 2016 and December 31, 2015(amounts in thousands, except weighted-average useful life):

	Weighted-Average Useful Life	March 31, 2016		December 31, 2015
Intangible lease assets:
In-place leases, net of accumulated amortization of $405,753 and $398,770, respectively	13.5	$	1,381,547	$	1,458,354
Leasing commissions, net of accumulated amortization of $1,137 and $1,035, respectively	9.2	6,060		4,872
Above-market leases, net of accumulated amortization of $51,944 and $47,041, respectively	16.1	299,293		308,306
Total intangible lease assets, net		$	1,686,900	$	1,771,532
Intangible lease liabilities:
Below-market leases, net of accumulated amortization of $42,629 and $38,340, respectively	17.4	$	245,093	$	251,692

The following table provides the projected amortization expense and adjustments to rental income related to the intangible lease assets and liabilities for the next five years as of March 31, 2016 (amounts in thousands):

	April 1, 2016 - December 31, 2016		2017		2018		2019		2020
In-place leases:
Total to be included in amortization expense	$	168,216	$	154,275	$	141,317	$	129,711	$	120,676
Leasing Commissions
Total to be included in amortization expense	$	1,341	$	682	$	496	$	425	$	407
Above-market lease assets:
Total to be deducted from rental income	$	25,672	$	25,309	$	24,756	$	22,801	$	22,334
Below-market lease liabilities:
Total to be included in rental income	$	23,115	$	20,453	$	20,126	$	19,388	$	18,196

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Real Estate Investments

3 Months Ended

Mar. 31, 2016

Real Estate [Abstract]

Real Estate Investments

Real Estate Investments

The Company acquired controlling financial interests in one commercial property for a purchase price of $20.0 million during the three months ended March 31, 2016. During the three months ended March 31, 2015, the Company acquired controlling interests in 10 commercial properties, including six land parcels, for an aggregate purchase price of $7.6 million.

The following table presents the allocation of the fair values of the assets acquired and liabilities assumed during the periods presented (in thousands):

	Three Months Ended March 31,
	2016		2015
Real estate investments, at cost:
Land	$	4,215	$	1,594
Buildings, fixtures and improvements	14,555		5,617
Total tangible assets	18,770		7,211
Acquired intangible assets:
In-place leases	1,182		416
Total purchase price of assets acquired	$	19,952	$	7,627

Future Lease Payments

The following table presents future minimum base rent payments due to the Company over the next five years and thereafter. These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items (in thousands):

	Future Minimum Operating Lease Base Rent Payments		Future Minimum Direct Financing Lease Payments (1)
April 1, 2016 - December 31, 2016	$	882,655	$	3,338
2017	1,162,408		4,036
2018	1,131,580		3,016
2019	1,090,919		2,397
2020	1,050,467		2,023
Thereafter	7,870,665		5,893
Total	$	13,188,694	$	20,703

____________________________________

(1) 36 properties are subject to direct financing leases and, therefore, revenue is recognized as direct financing lease income on the discounted cash flows of the lease payments. Amounts reflected are the minimum base rental cash payments due to the Company under the lease agreements on these respective properties.

Investment in Direct Financing Leases, Net

The components of the Company’s net investment in direct financing leases as of March 31, 2016 and December 31, 2015 are as follows (in thousands):

	March 31, 2016			December 31, 2015
Future minimum lease payments receivable	$	20,703		$	21,993
Unguaranteed residual value of property	31,562			31,562
Unearned income	(6,654		)	(7,243		)
Net investment in direct financing leases	$	45,611		$	46,312

Development Activities

As of March 31, 2016 and December 31, 2015, the Company had $15.9 million and $20.0 million, respectively, of land and construction in progress. The Company has contracted with a developer to complete a portfolio of build-to-suit development projects, of which 35 have been completed as of March 31, 2016, for an aggregate cost of $50.6 million to date and the remaining two projects are expected to be completed within the next three months. Pursuant to the agreement between the Company and the developer, the Company will acquire the respective land parcel for each development and subsequently pay a fixed construction draw until the project is complete. In addition, during the three months ended March 31, 2016, one build-to-suit project was completed and placed into service for an aggregate cost of $1.4 million. During the three months ended March 31, 2016 and 2015, the Company capitalized $0.1 million and $0.3 million, respectively, of interest expense associated with development projects.The Company is also in the process of completing four other expansion projects, which are expected to increase its revenue as a result of the additional square footage and improvement of the quality of the properties. Below is a summary of the construction commitments as of March 31, 2016 (dollar amounts in thousands):

Development projects in progress	6
Investment to date	$	12,729
Estimated cost to complete (1)	4,563
Total Investment (2)	$	17,292

_______________________________________________

(1) The Company is contractually committed to fund a developer $1.4 million to complete the remaining two build-to-suit developments.

(2) Excludes tenant improvement costs incurred in accordance with existing leases. As of March 31, 2016, $3.2 million of tenant improvement costs were included in buildings, fixtures and improvements in the consolidated financial statements.

Property Dispositions and Held for Sale Assets

During the three months ended March 31, 2016, the Company disposed of 58 properties for an aggregate gross sales price of $193.7 million, of which our share was $193.1 million after the profit participation payment related to the disposition of one Red Lobster. The dispositions resulted in proceeds of $133.8 million after a debt assumption of $55.0 million and closing costs. The Company recorded a gain of $18.8 million related to the sales, which included $11.3 million of goodwill allocated in the cost basis of such properties, which is included in gain (loss) on disposition of real estate, net in the accompanying consolidated statements of operations. During the three months ended March 31, 2015, the Company disposed of 11 properties for an aggregate gross sales price of $271.8 million, resulting in proceeds of $245.5 million after debt assumptions and closing costs. The Company recorded a loss of $31.4 million, including $23.7 million of goodwill allocation related to the sales. During the three months ended March 31, 2015, the Company also had one property that was foreclosed upon with a prior net book value of $38.2 million. The Company has no continuing involvement with these properties. The dispositions were not classified as discontinued operations for any period presented.

During the three months ended March 31, 2016, the Company also disposed of one property owned by an unconsolidated joint venture for a gross sales price of $113.5 million, of which our share was $102.1 million based on our ownership interest in the joint venture, resulting in proceeds of $42.3 million after debt repayments of $57.0 million and closing costs. The Company recorded a gain of $10.2 million related to the sale, which is included in equity in income and gain on disposition of unconsolidated entities in the accompanying consolidated statements of operations.

As of March 31, 2016, there were 19 properties classified as held for sale, which are expected to be sold in the next 12 months as part of the Company’s portfolio management strategy. To reflect the properties’ fair values less cost to sell, the Company recorded a loss of $1.7 million, which included $2.2 million of goodwill allocated in the cost basis of such properties, for the three months ended March 31, 2016. The loss on properties held for sale is included in gain (loss) on disposition of real estate, net in the accompanying consolidated statements of operations. As of December 31, 2015, there were 17 properties classified as held for sale, all of which were sold during the three months ended March 31, 2016.

Impairment of Real Estate Investments

The Company performs quarterly impairment review procedures, primarily through continuous monitoring of events and changes in circumstances that could indicate the carrying value of its real estate assets may not be recoverable. Impairment indicators that the Company considers include, but are not limited to, decrease in net operating income, bankruptcy or other credit concerns of a property’s major tenant or tenants, such as history of late payments, rental concessions and other factors, as well as significant decreases in a property’s revenues due to lease terminations, vacancies, co-tenancy clauses or reduced lease rates.

When impairment indicators are identified or if a property is considered to have a more likely than not probability of being disposed of within the next 12 to 24 months, the Company assesses the recoverability of the assets by determining whether the carrying value of the assets will be recovered through the undiscounted future cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying value, the Company will adjust the real estate assets to their respective fair values and recognize an impairment loss. Generally, fair value is determined using a discounted cash flow analysis and recent comparable sales transactions.

During the three months ended March 31, 2016, management identified certain properties for potential sale as part of its portfolio management strategy to reduce exposure to office properties. Additionally, a tenant of 59 restaurants filed for bankruptcy during the three months ended March 31, 2016. As part of the Company’s quarterly impairment review procedures and considering the factors mentioned above, real estate assets with carrying values totaling $623.0 million were deemed to be impaired and their carrying values were reduced to their estimated fair values of $462.5 million resulting in impairment charges of $160.5 million during the three months ended March 31, 2016. The Company identified certain properties during the three months ended March 31, 2015 with impairment indicators, however, the undiscounted future cash flows expected as a result of the use and eventual disposition of the real estate and related assets was in excess of the carrying amounts and, as such, no impairment charges were recorded.

Consolidated Joint Ventures

The Company had interests in two joint ventures that owned two properties as of each of March 31, 2016 and December 31, 2015 (the “Consolidated Joint Ventures”). As of March 31, 2016 and December 31, 2015, the Consolidated Joint Ventures had total assets of $58.0 million and $58.5 million, of which $54.9 million and $55.2 million, respectively, were real estate investments, net of accumulated depreciation and amortization. One property secured a mortgage note payable of $8.4 million, which is non-recourse to the Company. The Company has the ability to control operating and financial policies of the Consolidated Joint Venture. There are restrictions on the use of these assets as the Company would generally be required to obtain the respective partner's (“the Partner”) approval in accordance with the joint venture agreement for any major transactions. The Company and the Partner are subject to the provisions of the joint venture agreement, which includes provisions for when additional contributions may be required to fund certain cash shortfalls.

The Partners’ share of the Consolidated Joint Ventures’ loss of $39,000 and income of $0.2 million for the three months ended March 31, 2016 and March 31, 2015, respectively, is included in net loss attributable to non-controlling interests in the consolidated statements of operations.

Unconsolidated Joint Ventures

Investment in unconsolidated joint ventures consisted of the Company’s interest in two joint ventures that owned two properties and the Company’s interest in three joint ventures that owned three properties as of March 31, 2016 and December 31, 2015, respectively, which were comprised of 0.5 million square feet of retail space and 0.9 million square feet of retail and office space, respectively, (the “Unconsolidated Joint Ventures”). As of March 31, 2016 and December 31, 2015, the Company owned aggregate equity investments of $19.6 million and $52.8 million, respectively, in the Unconsolidated Joint Ventures. The Company accounts for the Unconsolidated Joint Ventures using the equity method of accounting as the Company has the ability to exercise significant influence, but not control, over operating and financial policies of these investments. The equity method of accounting requires the investment to be initially recorded at cost and subsequently adjusted for the Company’s share of equity in the joint ventures’ earnings and distributions. As of March 31, 2016, the Company’s maximum exposure to risk is $19.6 million, the carrying value of our investment, which is presented in the investment in unconsolidated entities line item in the consolidated balance sheets. The Unconsolidated Joint Ventures had total debt outstanding of $46.3 million as of March 31, 2016, none of which is recourse to the Company, as discussed in Note 10 –Debt. The Company and the respective Unconsolidated Joint Venture partner are subject to the provisions of the joint venture agreement which include provisions for when additional contributions may be required to fund certain cash shortfalls.

The Company records its proportionate share of net income from the Unconsolidated Joint Ventures in equity in income and gain on disposition of unconsolidated entities in the consolidated statements of operations. During the three months ended March 31, 2016 and 2015, the Company recognized $0.3 million and $0.1 million, respectively, of net income from the Unconsolidated Joint Ventures.

The following is a summary of the Company’s percentage ownership and carrying amount related to each of the Unconsolidated Joint Ventures as of March 31, 2016 (dollar amounts in thousands):

Name of Joint Venture	Partner	Ownership % (1)	Carrying Amount of Investment (2)
Cole/Mosaic JV South Elgin IL, LLC	Affiliate of Mosaic Properties and Development, LLC	50%	$	6,452
Cole/Faison JV Bethlehem GA, LLC	Faison-Winder Investors, LLC	90%	13,185
			$	19,637

_______________________________________________

(1) The Company’s ownership interest in this table reflects its legal ownership interest. Legal ownership may, at times, not equal the Company’s economic interest in the listed properties because of various provisions in certain joint venture agreements regarding distributions of cash flow based on capital account balances, allocations of profits and losses and payments of preferred returns. As a result, the Company’s actual economic interest (as distinct from its legal ownership interest) in certain of the properties could fluctuate from time to time and may not wholly align with its legal ownership interests.

(2) The total carrying amount of the investments is greater than the underlying equity in net assets by $6.7 million. This difference relates to a purchase price allocation of goodwill and a step up in fair value of the investment assets acquired in connection with the Cole Merger. The step up in fair value was allocated to the individual investment assets and is being amortized in accordance with the Company’s depreciation policy.

Tenant Concentration

As of March 31, 2016, there were no tenants exceeding 10% of the Company’s consolidated annualized rental income. Annualized rental income is rental revenue under the Company’s leases on operating properties reflecting straight-line rent adjustments associated with contractual rent increases in the leases as required by U.S. GAAP, which includes the effect of any tenant concessions, such as free rent, and excludes any contingent rent, such as percentage rent.

Geographic Concentration

As of March 31, 2016, properties located in Texas represented 13.2% of the Company’s consolidated annualized rental income. There were no other geographic concentrations exceeding 10% of the Company’s consolidated annualized rental income as of March 31, 2016.

Industry Concentration

As of March 31, 2016, tenants in the restaurant - casual dining and manufacturing industries accounted for 16.6% and 10.1% of the Company’s consolidated annualized rental income, respectively. There were no other industry concentrations exceeding 10% of the Company’s consolidated annualized rental income as of March 31, 2016.

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Investment Securities, at Fair Value

3 Months Ended

Mar. 31, 2016

Investments, Debt and Equity Securities [Abstract]

Investment Securities, at Fair Value

Investment Securities, at Fair Value

Investment securities are considered available-for-sale and, therefore, increases or decreases in the fair value of these investments are recorded in accumulated other comprehensive income (loss) as a component of equity in the consolidated balance sheets unless the securities are considered to be other-than-temporarily impaired at which time the losses are reclassified to expense.

The following tables detail the unrealized gains and losses on investment securities as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
CMBS	$	48,934	$	1,146	$	(1,918	)	$	48,162

	December 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
CMBS	$	52,115	$	2,169	$	(980	)	$	53,304

As of March 31, 2016 and December 31, 2015, the Company owned nine and ten CMBS, respectively, with an estimated aggregate fair value of $48.2 million and $53.3 million, respectively. During the three months ended March 31, 2016, one CMBS with a carrying value of less than $0.1 million at December 31, 2015, was paid in full prior to its maturity. The Company generally receives monthly payments of principal and interest on the CMBS. As of March 31, 2016, the Company earned interest on the CMBS at rates ranging between 5.88% and 8.95%. As of March 31, 2016, the fair value of five CMBS were below their amortized cost. In estimating other-than-temporary impairment losses, management considers a variety of factors, including: (i) whether the Company has the intent to sell the impaired security, (ii) whether the Company expects to hold the investment for a period of time sufficient to allow for anticipated recovery in fair value, and (iii) whether the company expects to recover the entire amortized cost basis of the security. The Company believes that none of the unrealized losses on investment securities are other-than-temporary as management expects the Company will fully recover the entire amortized cost basis of all securities. As of March 31, 2016, the Company had no other-than-temporary impairment losses.

The scheduled maturity of the Company’s CMBS as of March 31, 2016 is as follows (in thousands):

	March 31, 2016
	Amortized Cost		Fair Value
Due within one year	$	—	$	—
Due after one year through five years	21,656		22,316
Due after five years through 10 years	12,508		10,664
Due after 10 years	14,770		15,182
Total	$	48,934	$	48,162

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Mortgage Notes Receivable

3 Months Ended

Mar. 31, 2016

Receivables [Abstract]

Mortgage Notes Receivable

Mortgage Notes Receivable

As of March 31, 2016, the Company owned nine mortgage notes receivable with a weighted-average interest rate of 6.3% and weighted-average years to maturity of 13.7 years. During the three months ended March 31, 2016, one note with a carrying value of $0.4 million at December 31, 2015, reached maturity and was paid in full. The following table details the mortgage notes receivable as of March 31, 2016 (dollar amounts in thousands):

Outstanding Balance		Carrying Value		Interest Rate Range				Maturity Date Range
$	25,470	$	23,559	5.9	%	–	7.2%	May 2020	–	January 2033

The Company’s mortgage notes receivable are comprised primarily of fully-amortizing or nearly fully-amortizing first mortgage loans. The Company has one mortgage note receivable where the Company does not receive monthly payments of principal and interest but rather the interest is capitalized into the outstanding balance that is due at maturity. The mortgage notes receivable are primarily on commercial real estate, each leased to a single tenant. Therefore, the Company’s monitoring of the credit quality of its mortgage notes receivable is focused primarily on an analysis of the tenant, including review of tenant quality and ratings, trends in the tenant’s industry and general economic conditions and an analysis of measures of collateral coverage, such as an estimate of the loan-to-value ratio (principal amount outstanding divided by the estimated value of the property) and its remaining term until maturity.

The following table summarizes the scheduled aggregate principal payments due to the Company on the mortgage notes receivable subsequent to March 31, 2016 (in thousands):

	Outstanding Balance
Due within one year	$	1,024
Due after one year through five years	5,344
Due after five years through 10 years	6,725
Due after 10 years(1)	16,298
Total	$	29,391

____________________________________

(1)Includes additional$3.9 million of interest that will be capitalized into the outstanding balance of the mortgage note receivable subsequent toMarch 31, 2016.

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Rent and Tenant Receivables and Other Assets, Net

3 Months Ended

Mar. 31, 2016

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Rent and Tenant Receivables and Other Assets, Net

Rent and Tenant Receivables and Other Assets, Net

Rent and tenant receivables and other assets, net consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016		December 31, 2015
Accounts receivable, net (1)	$	42,574	$	44,798
Straight-line rent receivable	175,686		161,079
Deferred costs relating to revolving credit facility, net (2)	23,499		26,110
Prepaid expenses	13,852		9,773
Leasehold improvements, property and equipment, net (3)	17,889		18,180
Restricted escrow deposits	2,989		1,190
Deferred tax asset and tax receivable	21,335		25,287
Program development costs, net (4)	13,578		12,855
Interest rate swap assets, at fair value	—		1,892
Other assets	2,501		2,473
Total	$	313,903	$	303,637

___________________________________

(1) Allowance for doubtful accounts was $7.9 million and $6.6 million as of March 31, 2016 and December 31, 2015, respectively.

(2) Amortization expense for deferred costs related to the revolving credit facility totaled $2.6 million and $2.7 million for the three months ended March 31, 2016 and 2015, respectively. Accumulated amortization for deferred costs related to the revolving credit facility were $22.0 million and $19.4 million as of March 31, 2016 and December 31, 2015, respectively.

(3) Amortization expense for leasehold improvements totaled $0.3 million and $0.4 million for the three months ended March 31, 2016 and 2015, respectively. Accumulated amortization was $2.9 million and $2.6 million as of March 31, 2016 and December 31, 2015, respectively. Depreciation expense for property and equipment totaled $0.5 million for each of the three months ended March 31, 2016 and 2015, respectively. Accumulated depreciation was $4.2 million and $3.7 million as of March 31, 2016 and December 31, 2015, respectively.

(4) As of March 31, 2016 and December 31, 2015, the Company had reserves of $37.8 million and $34.8 million, respectively, relating to the program development costs.

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Fair Value Measures

3 Months Ended

Mar. 31, 2016

Fair Value Disclosures [Abstract]

Fair Value Measures

Fair Value Measures

The Company determines fair value based on quoted prices when available or through the use of alternative approaches, such as discounting the expected cash flows using market interest rates commensurate with the credit quality and duration of the investment. U.S. GAAP guidance defines three levels of inputs that may be used to measure fair value:

Level 1 – Quoted prices in active markets for identical assets and liabilities that the reporting entity has the ability to access at the measurement date.

Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset and liability or can be corroborated with observable market data for substantially the entire contractual term of the asset or liability.

Level 3 – Unobservable inputs reflect the entity’s own assumptions about the assumptions that market participants would use in the pricing of the asset or liability and are consequently not based on market activity, but rather through particular valuation techniques.

The determination of where an asset or liability falls in the hierarchy requires significant judgment and considers factors specific to the asset or liability. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. Changes in the type of inputs may result in a reclassification for certain assets. There were no transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy during the three months ended March 31, 2016. The Company expects that changes in classifications between levels will be infrequent.

Items Measured at Fair Value on a Recurring Basis

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis, based on market rates of the Company’s positions and other observable interest rates as discussed in Note 6 –Investment Securities, at Fair Value andNote 11 –Derivatives and Hedging Activities, as of March 31, 2016 and December 31, 2015, aggregated by the level in the fair value hierarchy within which those instruments fall (in thousands):

	Level 1		Level 2			Level 3		Balance as of March 31, 2016
Assets:
CMBS	$	—	$	—		$	48,162	$	48,162
Liabilities:
Derivative liabilities	$	—	$	(13,800	)	$	—	$	(13,800	)
	Level 1		Level 2			Level 3		Balance as of December 31, 2015
Assets:
CMBS	$	—	$	—		$	53,304	$	53,304
Derivative assets	—		1,892			—		1,892
Total assets	$	—	$	1,892		$	53,304	$	55,196
Liabilities:
Derivative liabilities	$	—	$	(6,922	)	$	—	$	(6,922	)

CMBS – The Company’s CMBS are carried at fair value and are valued using Level 3 inputs. The Company used estimated non-binding quoted market prices from the trading desks of financial institutions that are dealers in such securities for similar CMBS tranches that actively participate in the CMBS market. Broker quotes are only indicative of fair value and may not necessarily represent what the Company would receive in an actual trade for the applicable instrument. Management determines that the prices are representative of fair value through its knowledge of and experience in the market. The significant unobservable input used in valuing the CMBS is the discount rate or market yield used to discount the estimated future cash flows expected to be received from the underlying investment, which include both future principal and interest payments. Significant increases or decreases in the discount rate or market yield would result in a decrease or increase in the fair value measurement. The following risks are included in the consideration and selection of discount rates or market yields: risk of default, rating of the investment and comparable company investments.

Derivative Assets and Liabilities –The Company’s derivative financial instruments relate to interest rate swaps, discussed in Note 11 –Derivatives and Hedging Activities. The valuation of derivative instruments is determined using a discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, as well as observable market-based inputs, including interest rate curves and implied volatilities. In addition, credit valuation adjustments are incorporated into the fair values to account for the Company’s potential nonperformance risk and the performance risk of the counterparties.

Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with those derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties. However, as of March 31, 2016, the Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives. As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy.

The fair value of short-term financial instruments such as cash and cash equivalents, restricted cash, due to affiliates and accounts payable approximate their carrying value in the accompanying consolidated balance sheets due to their short-term nature and are classified as Level 1 under the fair value hierarchy.

The following are reconciliations of the changes in assets and liabilities with Level 3 inputs in the fair value hierarchy for the three months ended March 31, 2016 and 2015 (in thousands):

	CMBS
Beginning balance, December 31, 2015	$	53,304
Total gains and losses:
Unrealized loss included in other comprehensive income, net	(1,961		)
Purchases, issuances, settlements and amortization:
Principal payments received	(3,217		)
Amortization included in net income	36
Ending Balance, March 31, 2016	$	48,162

	CMBS
Beginning balance, December 31, 2014	$	58,646
Total gains and losses:
Unrealized gain included in other comprehensive income, net	796
Purchases, issuances, settlements and amortization:
Principal payments received	(2,949		)
Ending Balance, March 31, 2015	$	56,493

The fair values of the Company’s financial instruments that are not reported at fair value in the consolidated balance sheets are reported below (dollar amounts in thousands):

	Level	Carrying Amount at March 31, 2016		Fair Value at March 31, 2016		Carrying Amount at December 31, 2015		Fair Value at December 31, 2015
Assets:
Mortgage notes receivable	3	$	23,559	$	32,008	$	24,238	$	31,842
Liabilities (1):
Mortgage notes payable and other debt, net	2	$	3,049,340	$	3,131,489	$	3,133,005	$	3,240,153
Corporate bonds, net	2	2,547,452		2,578,973		2,547,255		2,580,786
Convertible debt, net	2	983,422		1,014,744		982,217		1,007,042
Credit facilities	2	1,280,000		1,282,200		1,460,000		1,536,264
Total liabilities		$	7,860,214	$	8,007,406	$	8,122,477	$	8,364,245

_______________________________________________

(1) Current and prior period liabilities’ carrying and fair values exclude net deferred financing costs.

Mortgage notes receivable – The fair value of the Company’s fixed-rate loan portfolio is estimated with a discounted cash flow analysis, utilizing scheduled cash flows and discount rates estimated by management to approximate market interest rates.

Debt – The fair value is estimated by an independent third party using a discounted cash flow analysis, based on management’s estimates of observable market interest rates.

Items Measured at Fair Value on a Non-Recurring Basis (Including Impairment Charges)

Certain financial and nonfinancial assets and liabilities are measured at fair value on a nonrecurring basis and are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment.

Real Estate Assets

As discussed in Note 5 –Real Estate Investments, during the three months ended March 31, 2016, real estate assets related to 125 properties were deemed to be impaired and their carrying values were reduced to their estimated fair value of $462.5 million, resulting in impairment charges of $160.5 million. During the three months ended March 31, 2015, no impairment charges were recorded. The Company estimates fair values using Level 3 inputs and using a combined income and market approach, specifically using discounted cash flow analysis and recent comparable sales transactions. The evaluation of real estate assets for potential impairment requires the Company’s management to exercise significant judgment and to make certain key assumptions, including, but not limited to, the following: (1) capitalization rate; (2) discount rates; (3) number of years property will be held; (4) property operating expenses; and (5) re-leasing assumptions including number of months to re-lease, market rental income and required tenant improvements. There are inherent uncertainties in making these estimates such as market conditions and performance and sustainability of the Company’s tenants. For our impairment tests for the real estate assets during the three months ended March 31, 2016, we used a range of discount rates from of 7.5% to 9.0% with a weighted-average rate of 8.1% and capitalization rates from 7.0% to 12.5% with a weighted-average rate of 7.8%.

The following table presents the impairment charges by asset class recorded during the three months ended March 31, 2016 (dollar amounts in thousands):

	Three Months Ended March 31,
	2016
Properties impaired	125
Asset classes impaired:
Investment in real estate assets, net	$	160,721
Below-market lease liabilities, net	(204		)
Total impairment loss	$	160,517

Goodwill and Intangible Assets

During the three months ended March 31, 2016 or 2015, no events or changes in circumstances were identified where management determined it is more likely than not that the fair value of a reporting unit is less than its carrying value. As such, we did not have any non-recurring fair value measurements related to goodwill and intangible assets during these periods.

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Debt

3 Months Ended

Mar. 31, 2016

Debt Disclosure [Abstract]

Debt

Debt

As of March 31, 2016, the Company had $7.8 billion of debt outstanding, including net premiums and net deferred financing costs, with a weighted-average years to maturity of 3.6 years and a weighted-average interest rate of 3.79%. The following table summarizes the carrying value of debt as of March 31, 2016 and December 31, 2015, and the debt activity for the three months ended March 31, 2016 (in thousands):

					Three Months Ended March 31, 2016
		Balance as of December 31, 2015			Debt Issuances		Repayments, Extinguishment and Assumptions			Accretion and (Amortization)			Balance as of March 31, 2016
Mortgage notes payable:
	Outstanding balance	$	3,039,882		$	206	$	(72,785	)	$	—		$	2,967,303
	Net premiums (1)	59,402			—		(1,096		)	(5,777		)	52,529
	Deferred costs	(21,020		)	—		329			1,017			(19,674		)
Other debt:
	Outstanding balance	33,463			—		(4,163		)	—			29,300
	Premium (1)	258			—		—			(50		)	208
Mortgages and other debt, net		3,111,985			206		(77,715		)	(4,810		)	3,029,666
Corporate bonds:
	Outstanding balance	2,550,000			—		—			—			2,550,000
	Discount (2)	(2,745		)	—		—			197			(2,548		)
	Deferred costs	(10,922		)	—		—			1,169			(9,753		)
Corporate bonds, net		2,536,333			—		—			1,366			2,537,699
Convertible debt:
	Outstanding balance	1,000,000			—		—			—			1,000,000
	Discount (2)	(17,779		)	—		—			1,201			(16,578		)
	Deferred costs	(19,327		)	—		—			1,374			(17,953		)
Convertible debt, net		962,894			—		—			2,575			965,469
Credit facility:
	Outstanding balance	1,460,000			203,000		(383,000		)	—			1,280,000
	Deferred costs (3)	(11,410		)	—		—			1,141			(10,269		)
Credit facility, net		1,448,590			203,000		(383,000		)	1,141			1,269,731
Total debt		$	8,059,802		$	203,206	$	(460,715	)	$	272		$	7,802,565

____________________________________

(1) Net premiums on mortgage notes payable and other debt were recorded upon the assumption of the respective debt instruments in relation to the various mergers and acquisitions. Amortization of these net premiums is recorded as a reduction to interest expense over the remaining term of the respective debt instruments using the effective-interest method.

(2) Discounts on the corporate bonds and convertible debt were recorded based upon the fair value of the respective debt instruments as of the respective issuance dates. Amortization of these discounts is recorded as an increase to interest expense over the remaining term of the respective debt instruments using the effective-interest method.

(3) Deferred costs relate to the term portion of the credit facility.

Mortgage Notes Payable

The Company’s mortgage notes payable consisted of the following as of March 31, 2016 (dollar amounts in thousands):

	Encumbered Properties	Gross Carrying Value of Collateralized Properties (1)		Outstanding Balance		Weighted-Average Interest Rate (2)		Weighted-Average Years to Maturity
Fixed-rate debt (3)	651	$	5,533,845	$	2,958,859	5.10	%	4.9
Variable-rate debt	1	24,797		8,444		3.39	%	0.4
Total (4)	652	$	5,558,642	$	2,967,303	5.09	%	4.9

____________________________________

(1) Gross carrying value is gross real estate assets, including investment in direct financing leases, net of gross real estate liabilities.

(2) Weighted-average interest rate for variable-rate debt represents the interest rate in effect as of March 31, 2016.

(3) Includes $247.9 million of variable-rate debt fixed by way of interest rate swap arrangements. 

(4) The table above does not include loan amounts associated with the Unconsolidated Joint Ventures of $46.3 million, none of which is recourse to the Company. These loans represent secured fixed and variable rates ranging from 2.84% to 5.20% and maturities ranging from October 2016 to July 2021, with a weighted-average interest rate of 3.88% and a weighted-average years to maturity of 2.6 years as of March 31, 2016.

The Company’s mortgage loan agreements generally restrict corporate guarantees and require the maintenance of financial covenants, including maintenance of certain financial ratios (such as specified debt to equity and debt service coverage ratios). The mortgage loan agreements contain no dividend restrictions except in the event of default or when a distribution would drive liquidity below the applicable thresholds. At March 31, 2016, the Company believes it was in compliance with the debt covenants under the mortgage loan agreements, except for a loan in default that is described below, and had no restrictions on the payment of dividends. The default on the loan did not result in a cross default on our other indebtedness.

During the three months ended March 31, 2016 and 2015, an aggregate of $55.0 million and $72.3 million, respectively, of mortgage notes payable were repaid prior to maturity or assumed by the buyer in a property disposition. During the three months ended March 31, 2015, $0.4 million was recorded in relation to the write-off of deferred financing costs and net premiums related to mortgage notes payable. During the three months ended March 31, 2016, no such write-off was recorded relating to the early repayment of debt. These costs are included in gain on extinguishment and forgiveness of debt, net in the accompanying consolidated statements of operations. The mortgage notes payable repaid during the three months ended March 31, 2016 had a weighted-average interest rate of 4.41% and a weighted-average remaining term of 2.9 years at the time of prepayment.

On January 13, 2015, a substantially vacant office building in Bethesda, Maryland was foreclosed upon after the Company elected to stop making debt service payments on the related non-recourse loan with an outstanding balance of $53.8 million as of December 31, 2014. As a result of the foreclosure, the Company forfeited its right to the property and was relieved of all obligations on the non-recourse loan. During the three months ended March 31, 2015, the Company recorded a gain on the forgiveness of debt of $4.9 million, which is included in gain on extinguishment and forgiveness of debt, net in the accompanying consolidated statements of operations.

On March 6, 2015, the Company received a notice of default from the lender of a non-recourse loan, which had an outstanding balance of $38.1 million as of March 31, 2016, due to the Company’s election not to make a reserve payment required per the loan agreement. Due to the default, the Company is currently accruing interest at the default rate of interest of 10.68% per annum. The Company is engaged with the servicer to complete foreclosure proceedings.

The following table summarizes the scheduled aggregate principal repayments due on mortgage notes subsequent to March 31, 2016 (in thousands):

	Total
April 1, 2016 - December 31, 2016 (1)	$	198,991
2017	412,546
2018	211,026
2019	231,461
2020	284,197
Thereafter	1,629,082
Total	$	2,967,303

____________________________________

(1) Includes $38.1 million of mortgage notes in connection with the default of a non-recourse loan discussed above.

Other Debt

As of March 31, 2016, the Company had a secured term loan from KBC Bank, N.V. with an outstanding principal balance of $29.3 million and remaining unamortized premium of $0.2 million (the “KBC Loan”). The interest coupon on the KBC Loan is fixed at 5.81% annually until its maturity in January 2018. The KBC Loan is non-recourse to the Company, subject to limited non-recourse exceptions. The KBC Loan provides for monthly payments of both principal and interest. The scheduled principal repayments subsequent to March 31, 2016 are $8.3 million, $7.7 million and $13.3 million for the years ended December 31, 2016, 2017 and 2018, respectively.

The KBC Loan is secured by various investment assets held by the Company. The following table is a summary of the outstanding balance and carrying value of the collateral by asset type as of March 31, 2016 (in thousands):

	Outstanding Balance		Collateral Carrying Value
Mortgage notes receivable	$	8,095	$	19,950
Intercompany mortgage loans	2,264		5,462
CMBS	18,941		35,921
	$	29,300	$	61,333

Corporate Bonds

As of March 31, 2016, the OP had $2.55 billion aggregate principal amount of senior unsecured notes outstanding comprised of 2.00% senior notes due 2017 (the “2017 Senior Notes”), 3.00% senior notes due 2019 (the “2019 Senior Notes”) and 4.60% senior notes due 2024 (the “2024 Senior Notes” and, together with the 2017 Senior Notes and the 2019 Senior Notes, (the “Senior Notes”). The following table presents the three senior notes with their respective terms (dollar amounts in thousands):

	Outstanding Balance		Interest Rate		Maturity Date
2017 Senior Notes	$	1,300,000	2.0	%	February 6, 2017
2019 Senior Notes	750,000		3.0	%	February 6, 2019
2024 Senior Notes	500,000		4.6	%	February 6, 2024
Total balance and weighted-average interest rate	$	2,550,000	2.8	%

The Senior Notes are guaranteed by the General Partner. The OP may redeem all or a part of any series of the Senior Notes at any time, at its option, for the redemption prices set forth in the indenture governing the Senior Notes. With respect to the 2019 Senior Notes and the 2024 Senior Notes, if such Senior Notes are redeemed on or after January 6, 2019 with respect to the 2019 Senior Notes, or November 6, 2023 with respect to the 2024 Senior Notes, the redemption price will equal 100% of the principal amount of the Senior Notes of the applicable series to be redeemed, plus accrued and unpaid interest on the amount being redeemed to, but excluding, the applicable redemption date. The Senior Notes are registered under the Securities Act of 1933, as amended, and are freely transferable. The Company believes it was in compliance with the covenants pursuant to the indenture governing the Senior Notes as of March 31, 2016.

Convertible Debt

As of March 31, 2016, the OP had two tranches of Convertible Notes with an outstanding aggregate balance of $1.0 billion, comprised of the 2018 Convertible Notes and 2020 Convertible Notes. The Convertible Notes are identical to the General Partner’s registered issuance of the same amount of notes to various purchasers in a public offering. The following table presents each of the 2018 Convertible Notes and the 2020 Convertible Notes listed below with their respective terms (dollar amounts in thousands):

	Outstanding Balance (1)		Interest Rate		Conversion Rate (2)	Maturity Date
2018 Convertible Notes	$	597,500	3.00	%	60.5997	August 1, 2018
2020 Convertible Notes	402,500		3.75	%	66.7249	December 15, 2020
Total balance and weighted-average interest rate	$	1,000,000	3.30	%

____________________________________

(1) Excludes the carrying value of the conversion options recorded within additional paid-in capital of $28.6 million and the unamortized discount of $16.6 million as of March 31, 2016. The discount will be amortized over the remaining term of 3.3 years.

(2) Conversion rate represents the amount of the General Partner OP Units per $1,000 principal amount of Convertible Notes converted as of March 31, 2016, as adjusted in accordance with the applicable indentures as a result of cash dividend payments.

In connection with any permissible conversion election made by the holders of the identical convertible notes issued by the General Partner, the General Partner may elect to convert the 2018 Convertible Notes into cash, General Partner OP Units or a combination thereof, in limited circumstances prior to February 1, 2018 and may convert the 2018 Convertible Notes at any time into such consideration on or after February 1, 2018. Additionally, the General Partner may elect to convert the 2020 Convertible Notes into cash, General Partner OP Units or a combination thereof, in limited circumstances prior to June 15, 2020, and may convert the 2020 Convertible Notes at any time into such consideration on or after June 15, 2020. The Company believes it was in compliance with the covenants pursuant to the indenture governing the Convertible Notes as of March 31, 2016.

Credit Facility

The General Partner, as guarantor, and the OP, as borrower, are parties to an unsecured credit facility (the “Credit Facility”) pursuant to a credit agreement, dated as of June 30, 2014, as amended, with Wells Fargo, National Association (“Wells Fargo”), as administrative agent and other lenders party thereto (the “Credit Agreement”).

On July 31, 2015, the General Partner and the OP entered into the Second Amendment to the Credit Agreement (the “Second Amendment”) with Wells Fargo and other lenders party to the Credit Agreement. Pursuant to the Second Amendment, the maximum capacity under the Credit Facility was reduced from $3.6 billion to $3.3 billion, which included a reduction in the size of the $2.45 billion revolving credit facility to $2.3 billion and the elimination of the $150.0 million multicurrency revolving credit facility. The maximum aggregate dollar amount of letters of credit that may be outstanding at any one time under the Credit Facility was reduced from $50.0 million to $25.0 million. 

In respect of financial covenants, the Second Amendment reduced the Company’s minimum Unencumbered Asset Value (as defined in the Credit Agreement) from $10.5 billion to $8.0 billion. For the purposes of determining Unencumbered Asset Value, the Company is permitted to include restaurant properties representing more than 30% of its Unencumbered Asset Value in such calculation such that: (i) from July 1, 2015 to June 29, 2016, up to 40% of the Unencumbered Asset Value may be comprised of restaurant properties; and (ii) from June 30, 2016 to December 30, 2016, up to 35% of the Unencumbered Asset Value may be comprised of restaurant properties. From December 31, 2016, the maximum percentage of Unencumbered Asset Value attributable to restaurant properties will be reduced back down to 30%. In connection with the Second Amendment, the Company agreed to pay certain customary fees to the consenting lenders and agreed to reimburse customary expenses of the arrangers, which are recorded as deferred financing costs and included in rent and tenant receivables and other assets, net in the accompanying consolidated balance sheets.

As of March 31, 2016, the Credit Facility allowed for maximum borrowings of $3.3 billion, consisting of a $1.0 billion term loan facility and a $2.3 billion revolving credit facility. The outstanding balance on the Credit Facility was $1.3 billion, of which $0.3 billion bore a floating interest rate of 2.24%, at March 31, 2016. The remaining outstanding balance on the Credit Facility of $1.0 billion is, in effect, fixed through the use of derivative instruments used to hedge interest rate volatility. Including the spread, which can vary based on the General Partner’s credit rating, the interest rate on this portion was 3.29% at March 31, 2016. As of March 31, 2016, a maximum of $2.0 billion was available to the OP for future borrowings, subject to borrowing availability.

The revolving credit facility generally bears interest at an annual rate of LIBOR plus 1.00% to 1.80% or Base Rate plus 0.00% to 0.80% (based upon the General Partner’s then current credit rating). “Base Rate” is defined as the highest of the prime rate, the federal funds rate plus 0.50% or a floating rate based on one month LIBOR, determined on a daily basis. The term loan facility generally bears interest at an annual rate of LIBOR plus 1.15% to 2.05%, or Base Rate plus 0.15% to 1.05% (based upon the General Partner’s then current credit rating). In addition, the Credit Agreement provides the flexibility for interest rate auctions, pursuant to which, at the Company’s election, the Company may request that lenders make competitive bids to provide revolving loans, which competitive bids may be at pricing levels that differ from the foregoing interest rates.

The Credit Agreement provides for monthly interest payments under the Credit Facility. In the event of default, at the election of a majority of the lenders (or automatically upon a bankruptcy event of default with respect to the OP or the General Partner), the commitments of the lenders under the Credit Facility will mature, and payment of any unpaid amounts in respect of the Credit Facility will be accelerated. The revolving credit facility and the term loan facility both terminate on June 30, 2018, in each case, unless extended in accordance with the terms of the Credit Agreement. The Credit Agreement provides for a one-year extension option with respect to each of the revolving credit facility and the term loan facility, exercisable at the Company’s election and subject to certain customary conditions, as well as certain customary “amend and extend” provisions. At any time, upon timely notice by the OP and subject to any breakage fees, the OP may prepay borrowings under the Credit Facility (subject to certain limitations applicable to the prepayment of any loans obtained through an interest rate auction, as described above). The OP incurs a fee equal to 0.15% to 0.25% per annum (based upon the General Partner’s then current credit rating) multiplied by the commitments (whether or not utilized) in respect of the revolving credit facility. In addition, the OP incurs customary administrative agent, letter of credit issuance, letter of credit fronting, extension and other fees.

The Credit Facility requires restrictions on corporate guarantees, as well as the maintenance of financial covenants, including the maintenance of certain financial ratios (such as specified debt to equity and debt service coverage ratios) and the maintenance of a minimum net worth. The key financial covenants in the Credit Facility, as defined and calculated per the terms of the Credit Agreement, include maintaining (i) a maximum leverage ratio less than or equal to 60%, (ii) a minimum fixed charge coverage ratio of at least 1.5x, (iii) a secured leverage ratio less than or equal to 45%, (iv) a total unencumbered asset value ratio less than or equal to 60%, (v) a minimum tangible net worth covenant of at least $5.5 billion, (vi) a minimum unencumbered interest coverage ratio of at least 1.75x and (vii) a minimum unencumbered asset value of at least $8.0 billion. The Company believes it was in compliance with the Credit Agreement and is not restricted from accessing any borrowings under the Credit Facility as of March 31, 2016.

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Derivatives and Hedging Activities

3 Months Ended

Mar. 31, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives and Hedging Activities

Derivatives and Hedging Activities

Risk Management Objective of Using Derivatives

The Company may use derivative financial instruments, including interest rate swaps, caps, options, floors and other interest rate derivative contracts, to hedge all or a portion of the interest rate risk associated with its borrowings. The principal objective of such arrangements is to minimize the risks and/or costs associated with the Company’s operating and financial structure as well as to hedge specific anticipated transactions. The Company does not intend to utilize derivatives for purposes other than interest rate risk management. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which the Company and its affiliates may also have other financial relationships. The Company does not anticipate that any of the counterparties will fail to meet their obligations.

Cash Flow Hedges of Interest Rate Risk

The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish these objectives, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.

The effective portion of changes in the fair value of derivatives designated that qualify as cash flow hedges is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During the three months ended March 31, 2016, such derivatives were used to hedge the variable cash flows associated with variable-rate debt. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt. During the next 12 months, the Company estimates that an additional $6.0 million will be reclassified from other comprehensive income to interest expense.

As of March 31, 2016, the Company had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk (dollar amounts in thousands):

Interest Rate Swaps	March 31, 2016
Number of Instruments	16
Notional Amount	$	1,211,457

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in the consolidated balance sheets as of March 31, 2016 and December 31, 2015 (in thousands):

Derivatives Designated as Hedging Instruments	Balance Sheet Location	March 31, 2016			December 31, 2015
Interest rate swaps	Rent and tenant receivables and other assets, net	$	—		$	1,794
Interest rate swaps	Deferred rent, derivative and other liabilities	$	(12,989	)	$	(6,922	)

In January 2014, the Company entered into an interest rate lock agreement with a notional amount of $250.0 million (the “Treasury Lock Agreement”). The Treasury Lock Agreement, which had an original maturity date of February 12, 2014, was entered into to hedge part of the Company’s interest rate exposure associated with the variability in future cash flows attributable to changes in the 10-year U.S. treasury rates related to the planned issuance of debt securities in conjunction with the Cole Merger. In connection with the Company’s offering of Senior Notes in February 2014, the Company settled the Treasury Lock Agreement for $3.9 million, which was accounted for as a cash flow hedge, recorded to other comprehensive loss and will be amortized into earnings over the 10-year term of the Treasury Lock. The Company recognized $0.1 million of interest expense for the three months ended March 31, 2016 related to the Treasury Lock Agreement.

Derivatives Not Designated as Hedging Instruments

Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to interest rate movements and other identified risks but do not meet the requirements to be classified as hedging instruments. A loss of $1.1 million related to the change in the fair value of derivatives not designated as hedging instruments and other ineffectiveness was recorded directly in earnings for the three months ended March 31, 2016. The Company recorded a loss of $1.0 million for the three months ended March 31, 2015.

As of March 31, 2016, the Company had the following outstanding interest rate derivative that was not designated as a qualifying hedging relationship (dollar amounts in thousands):

Interest Rate Swap	March 31, 2016
Number of Instruments	1
Notional Amount	$	51,400

The table below presents the fair value of the Company’s derivative financial instrument not designated as a hedge as well as its classification in the consolidated balance sheets as of March 31, 2016 and December 31, 2015 (in thousands):

Derivatives Not Designated as Hedging Instruments	Balance Sheet Location	March 31, 2016			December 31, 2015
Interest rate swaps	Rent and tenant receivables and other assets, net	$	—		$	98
Interest rate swaps	Deferred rent, derivative and other liabilities	$	(811	)	$	—

Tabular Disclosure of Offsetting Derivatives

The table below details a gross presentation, the effects of offsetting and a net presentation of the Company’s derivatives as of March 31, 2016 and December 31, 2015 (in thousands). The net amounts of derivative assets or liabilities can be reconciled to the tabular disclosure of fair value. The tabular disclosure of fair value provides the location that derivative assets and liabilities are presented in the accompanying consolidated balance sheets.

	Offsetting of Derivative Assets and Liabilities
	Gross Amounts of Recognized Assets		Gross Amounts of Recognized Liabilities			Gross Amounts Offset in the Consolidated Balance Sheets		Net Amounts of Assets Presented in the Consolidated Balance Sheets		Net Amounts of Liabilities Presented in the Consolidated Balance Sheets			Financial Instruments		Cash Collateral Received		Net Amount
March 31, 2016	$	—	$	(13,800	)	$	—	$	—	$	(13,800	)	$	—	$	—	$	(13,800	)
December 31, 2015	$	1,892	$	(6,922	)	$	—	$	1,892	$	(6,922	)	$	—	$	—	$	(5,030	)

Credit Risk Related Contingent Features

The Company has agreements with each of its derivative counterparties that contain a provision specifying that if the Company either defaults or is capable of being declared in default on any of its indebtedness, the Company could also be declared in default on its derivative obligations.

As of March 31, 2016, the fair value of the interest rate derivatives in a net liability position, including accrued interest but excluding any adjustment for nonperformance risk related to these agreements, was $15.2 million. As of March 31, 2016, the Company has not posted any collateral related to these agreements and was not in breach of any provisions in these agreements. If the Company had breached any of these provisions, it could have been required to settle its obligations under the agreements at their aggregate termination value of $15.2 million at March 31, 2016.

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Supplemental Cash Flow Disclosures

3 Months Ended

Mar. 31, 2016

Supplemental Cash Flow Elements [Abstract]

Supplemental Cash Flow Disclosures

Supplemental Cash Flow Disclosures

Supplemental cash flow information was as follows for the three months ended March 31, 2016 and 2015 (in thousands):

	Three Months Ended March 31,
	2016		2015
Supplemental Disclosures:
Cash paid for interest	$	93,713	$	109,025
Cash paid for income taxes	$	10,848	$	51
Non-cash investing and financing activities:
Accrued capital expenditures and real estate developments	$	1,327	$	4,126
Accrued repurchases of common stock to settle tax obligation	$	223	$	—
Accrued distributions	$	3,157	$	—
Mortgage note payable relieved by foreclosure	$	—	$	53,798
Mortgage notes payable assumed in real estate disposition	$	55,000	$	24,000

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Accounts Payable and Accrued Expenses

3 Months Ended

Mar. 31, 2016

Payables and Accruals [Abstract]

Accounts Payable and Accrued Expenses

Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016		December 31, 2015
Accrued interest	$	40,215	$	56,273
Accrued real estate taxes	35,134		47,319
Accrued legal fees	13,922		9,212
Accounts payable	2,547		2,868
Accrued other	27,152		36,205
Total	$	118,970	$	151,877

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2016

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Litigation

The Company is involved in various routine legal proceedings and claims incidental to the ordinary course of its business. There are no material legal proceedings pending against the Company, except as follows:

Government Investigations and Litigation Relating to the Audit Committee Investigation

On October 29, 2014, the Company filed a Current Report on Form 8-K (the “October 29 8-K”) reporting the Audit Committee’s conclusion, based on the preliminary findings of its investigation, that certain previously issued consolidated financial statements of the Company, including those included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013 and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014, and related financial information should no longer be relied upon. Prior to that filing, the Audit Committee previewed for the SEC the information contained in the filing. Subsequent to that filing, the SEC provided notice that it had commenced a formal investigation and issued subpoenas calling for the production of various documents. In addition, the United States Attorney’s Office for the Southern District of New York contacted counsel for the Audit Committee and counsel for the Company with respect to this matter, and the Secretary of the Commonwealth of Massachusetts issued a subpoena calling for the production of various documents. The Audit Committee and the Company are cooperating with these regulators in their investigations.

As discussed below, the Company and certain of its former officers and current and former directors have been named as defendants in a number of lawsuits filed following the October 29 8-K, including class actions, derivative actions, and individual actions under the federal securities laws and state common and corporate laws in both federal and state courts in New York, Maryland and Arizona.

Between October 30, 2014 and January 20, 2015, the Company and certain of its former officers and current and former directors, among other individuals and entities, were named as defendants in ten putative securities class action complaints filed in the United States District Court for the Southern District of New York (the “SDNY Actions”). The Court subsequently consolidated the SDNY Actions under the caption In re American Realty Capital Properties, Inc. Litigation, No. 15-MC-00040 (AKH) (the “SDNY Consolidated Securities Class Action”). Following motions to dismiss filed by the defendants, which were granted in part and denied in part, the lead plaintiff filed an amended class action complaint on December 11, 2015, which asserted claims for violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Certain defendants, including the Company filed motions to dismiss the second amended class action complaint (or portions thereof) on February 12, 2016. The motions to dismiss are fully briefed and the Court has scheduled oral argument on May 12, 2016.

In addition, on November 25, 2014, the Company and certain of its former officers and current and former directors were named as defendants in a putative securities class action complaint filed in the Circuit Court for Baltimore County, Maryland, captioned Wunsch v. American Realty Capital Properties, Inc., et al., No. 03-C-14-012816 (the “Wunsch Action”). On December 23, 2014, the Company removed the action to the United States District Court for the District of Maryland and on April 15, 2015, the Maryland court transferred the Wunsch Action to the United States District Court for the Southern District of New York. On December 15, 2015, the Wunsch Action was consolidated with the SDNY Consolidated Securities Class Action.

In January 2015, the Company and certain of its former directors and officers were named as defendants in an individual securities fraud action filed in the United States District Court for the Southern District of New York, captioned Jet Capital Master Fund, L.P. v. American Realty Capital Properties, Inc., et al., No. 15-cv-307 (AKH) (the “Jet Capital Action”). The Jet Capital Action seeks money damages and asserts claims for alleged violations of Sections 10(b), 18 and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, as well as common law fraud under New York law in connection with the purchase of the Company’s securities. On April 17, 2015, the plaintiff filed an amended complaint. On October 27, 2015, the court denied defendants’ motions to dismiss the complaint and all defendants filed answers to the complaint by December 18, 2015.

The Company, certain of its former officers and current and former directors, and the OP (in addition to several other individuals and entities) have also been named as defendants in two additional individual securities fraud actions filed in the United States District Court for the Southern District of New York, captioned Twin Securities, Inc. v. American Realty Capital Properties, Inc., et al., No. 15-cv-1291 (the “Twin Securities Action”) and HG Vora Special Opportunities Master Fund, Ltd v. American Realty Capital Properties, Inc., et al., No. 15-cv-4107 (the “HG Vora Action”). The Twin Securities Action and the HG Vora Action seek money damages and assert claims for alleged violations of Sections 10(b), 14(a), 18, and 20(a) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14a-9 promulgated thereunder, Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as well as common law fraud under New York law in connection with the purchase of the Company’s securities. The Company and defendants are not yet required to respond to the complaints in either of these actions.

On October 27, 2015, the Company and certain of its former officers, the OP, and other entities were named as defendants in an individual securities fraud action filed in the United States District Court for the District of Arizona, captioned Vanguard Specialized Funds, et al. v. VEREIT, Inc. et al., No. 15-cv-02157 (ESW) (the “Vanguard Action”). The Vanguard Action seeks money damages and asserts claims for alleged violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b), 14(a) and 20(a) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14a-9 promulgated thereunder, arising out of allegedly false and misleading statements in connection with the purchase or sale of the Company’s securities. The Vanguard Action also asserts claims under Arizona law pursuant to the Arizona Consumer Fraud Act and seeks punitive damages thereunder. On January 21, 2016, the Company filed a motion to transfer the Vanguard Action to the United States District Court for the Southern District of New York and a motion to dismiss the complaint. The motions are fully briefed and pending before the court.

On October 27 and October 28, 2015, the Company and certain of its former officers, the OP, and other entities were named as defendants in four individual securities fraud actions filed in the United States District Court for the Southern District of New York: BlackRock ACS US Equity Tracker Fund, et al. v. American Realty Capital Properties, Inc. et al., No. 15-cv-08464 (the “BlackRock Action”); PIMCO Funds: PIMCO Diversified Income Fund, et al. v. American Realty Capital Properties, Inc. et al., No. 15-cv-08466 (the “PIMCO Action”); Clearline Capital Partners LP, et al. v. American Realty Capital Properties, Inc. et al., No. 15-cv-08467 (the “Clearline Action”); and Pentwater Equity Opportunities Master Fund Ltd., et al. v. American Realty Capital Properties, Inc. et al., No. 15-cv-08510 (the “Pentwater Action”). All four actions seek money damages arising out of allegedly false and misleading statements in connection with the purchase or sale of the Company’s securities. The BlackRock Action and the PIMCO Action assert claims for alleged violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The BlackRock Action also asserts claims under Section 14(a) of the Securities Exchange Act of 1934 and Rule 14a-9 promulgated thereunder. The Clearline Action and the Pentwater Action assert claims under Sections 10(b), 18(a) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The Clearline Action and the Pentwater Action also assert a claim for common law fraud under New York law and seek punitive damages thereunder. The Company is not yet required to respond to the complaints in these actions.

On October 28, 2015, the Company and certain of its former officers and directors (among other individuals and entities) were named as defendants in a putative securities class action complaint filed in the United States District Court for the Southern District of New York: IRA FBO John Esposito v. American Realty Capital Properties, Inc. et al., No. 15-cv-08508 (the “Esposito Action”). The Esposito Action seeks money damages and asserts claims for alleged violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Section 14(a) of the Securities Exchange Act of 1934 and Rule 14a-9 promulgated thereunder, arising out of allegedly false and misleading statements in connection with the purchase or sale of the Company’s securities. The Company is not yet required to respond to the complaint in the Esposito Action.

On July 31, 2015, the Company and certain of its former officers and current and former directors were named as defendants in a shareholder derivative action filed in the United States District Court for the Southern District of New York, captioned Witchko v. Schorsch, et al., No. 15-cv-06043 (AKH) (the “Witchko Action”). The Witchko Action asserts claims under Section 14 of the Exchange Act arising out of allegedly false and misleading statements made in the Company’s proxy statements and the incorporation by reference of allegedly false and misleading financial statements. The Witchko Action also seeks money damages and other relief on behalf of the Company, for, among other things, alleged breach of fiduciary duty, abuse of control and unjust enrichment. On October 15, 2015, the Company and other defendants filed motions to dismiss the Witchko Action due to plaintiff’s failure to plead facts, as required under Maryland law, demonstrating that the Board’s decision to refuse plaintiff’s pre-suit demand was wrongful and not a protected business judgment.

On October 30, 2015, the Company and certain of its former officers and directors were named as defendants in a shareholder derivative action filed in the United States District Court for the Southern District of New York, captioned Serafin, et al. v. Schorsch, et al., No. 15-cv-08563 (the “Serafin Action”). The Serafin Action seeks money damages and other relief on behalf of the Company for, among other things, alleged breach of fiduciary duty and contribution and indemnification. The court has consolidated the Witchko Action and the Serafin Action (together “the SDNY Derivative Action”) and the plaintiffs have designated the complaint filed in the Witchko Action as the complaint in the SDNY Derivative Action. On February 12, 2016, the Company and other defendants filed a motion to dismiss the SDNY Derivative Action due to plaintiffs’ failure to plead facts, as required under Maryland law, demonstrating that the Board’s decision to refuse plaintiff’s pre-suit demand was wrongful and not a protected business judgment. Other defendants also filed motions to dismiss for failure to state a claim. The motions to dismiss are fully briefed and the Court has scheduled oral argument on May 12, 2016.

On December 3, 2015, the Company and certain of its former officers and directors were named as defendants in a shareholder derivate action filed in the Circuit Court for Baltimore City in Maryland, captioned Frampton v. Schorsch, et al., No. 24-C-15-006269 (the “Frampton Action”). The Frampton Action seeks money damages and other relief on behalf of the Company for, among other things, alleged breaches of fiduciary duty and contribution and indemnification. The Company filed a motion to stay the Frampton Action on March 7, 2016. That motion is fully briefed and pending before the court.

The Company has not reserved amounts for any of the litigation or investigation matters above either because it has not concluded that a loss is probable in the matter or because it believes that any probable loss or reasonably possible range of loss is not reasonably estimable at this time. The Company is currently unable to estimate a range of reasonably possible loss because these matters involve significant uncertainties, including the complexity of the facts and the legal theory and the nature of the claims.

CapLease Litigation Matters

Following the announcement of the merger agreement with CapLease in May 2013, a number of lawsuits were filed by CapLease stockholders, the following of which remain pending:

On June 25, 2013, a putative class action and derivative lawsuit was filed in the Circuit Court for Baltimore City against the Company, the OP, CapLease, and members of the CapLease board of directors, among others, captioned Tarver v. CapLease, Inc., et al., No. 24-C-13-004176 (the “Tarver Action”). The complaint alleged, among other things, that the merger agreement was the product of breaches of fiduciary duty by the CapLease directors because the transaction purportedly did not provide for full and fair value for the CapLease shareholders and was not the result of a competitive bidding process, the merger agreement allegedly contained coercive deal protection measures and the merger was purportedly approved as a result of improper self-dealing by certain defendants who would receive certain alleged employment compensation benefits and continued employment pursuant to the merger agreement.

In August 2013, counsel in the Tarver Action filed a motion for a stay in the Baltimore Court, informing the court that the plaintiff had agreed to join and participate in the prosecution of other actions concerning the CapLease transaction then pending in a New York court (which were subsequently dismissed). The stay was granted by the Baltimore Court and the parties have engaged in no subsequent activity in the Tarver Action.

In October 2013, a putative class action lawsuit was filed in the Circuit Court for Baltimore City against the Company, the OP, CapLease, and members of the CapLease board of directors, among others, captioned Poling v. CapLease, Inc., et al., No. 24-C-13-006178 (the “Poling Action”). The complaint alleged that the merger agreement breached the terms of the CapLease 8.375% Series B Cumulative Redeemable Preferred Stock (“Series B”) and the terms of the 7.25% Series C Cumulative Redeemable Preferred Stock (“Series C”) and was in violation of the Series B Articles Supplementary and the Series C Articles Supplementary. The complaint alleged claims for breach of contract and breach of fiduciary duty against the CapLease entities and the CapLease board of directors, and that the Company, the OP and Safari Acquisition, LLC aided and abetted CapLease and the CapLease directors’ alleged breach of contract and breach of fiduciary duty.

In December 2013, all Defendants filed a motion to dismiss the Poling Action, which was granted by the court in May 2015. Plaintiff filed a notice of appeal on June 4, 2015. The appeal is pending.

Cole Litigation Matters

Two actions filed in March and April 2013 in the United States District Court for the District of Arizona, assert shareholder class action claims under the Securities Act of 1933, along with claims for breach of fiduciary duty, abuse of control, corporate waste, and unjust enrichment, among others, relating to the merger between a wholly owned subsidiary of Cole and Cole Holdings Corporation, pursuant to which Cole became a self-managed REIT; Schindler v. Cole Holdings Corp., et al., 13-cv-00712 (the “Schindler Action”); and Carter v. Cole Holdings Corp., et al., 13-cv-00629 (the “Carter Action”). Defendants filed a motion to dismiss both complaints in January 2014. Both of those lawsuits were stayed by the Court pursuant to a joint request made by all parties pending final approval of a consolidated action in the Circuit Court for Baltimore City, Maryland, which case was finally resolved on appeal on February 1, 2016. The Carter Action was subsequently dismissed voluntarily by Plaintiffs on March 30, 2016 and the Schindler Action was dismissed with prejudice by the court on April 14, 2016.

In December 2013, Realistic Partners filed a putative class action lawsuit against the Company and the then-members of its board of directors in the Supreme Court for the State of New York, captioned Realistic Partners v. American Realty Capital Partners, et al., No. 654468/2013. Cole was later added as a defendant. The plaintiff alleged, among other things, that the board of the Company breached its fiduciary duties in connection with the transactions contemplated under the Cole Merger Agreement and that Cole aided and abetted those breaches. In January 2014, the parties entered into a memorandum of understanding regarding settlement of all claims asserted on behalf of the alleged class of the Company’s stockholders. The proposed settlement terms required the Company to make certain additional disclosures related to the Cole Merger, which were included in a Current Report on Form 8-K filed by the Company with the SEC on January 17, 2014. The memorandum of understanding also contemplated that the parties would enter into a stipulation of settlement, which would be subject to customary conditions, including confirmatory discovery and court approval following notice to the Company’s stockholders, and provided that the defendants would not object to a payment of up to $625,000 for attorneys’ fees. If the parties enter into a stipulation of settlement, which has not occurred, a hearing will be scheduled at which the court will consider the fairness, reasonableness and adequacy of the settlement. There can be no assurance that the parties will ultimately enter into a stipulation of settlement, that the court will approve any proposed settlement, or that any eventual settlement will be under the same terms as those contemplated by the memorandum of understanding.

Contractual Lease Obligations

The following table reflects the minimum base rent payments due from the Company over the next five years and thereafter for certain ground lease obligations, which are substantially reimbursable by our tenants, and office lease obligations (in thousands):

	Future Minimum Base Rent Payments
	Ground Leases		Office Leases
April 1, 2016 - December 31, 2016	$	10,659	$	3,793
2017	14,820		4,585
2018	14,410		4,704
2019	14,146		4,769
2020	13,386		4,797
Thereafter	224,648		14,089
Total	$	292,069	$	36,737

Purchase Commitments

Cole Capital enters into purchase and sale agreements and deposits funds into escrow towards the purchase of real estate assets, most of which are expected to be assigned to one of the Cole REITs at or prior to the closing of the respective acquisition. As of March 31, 2016, Cole Capital was a party to eight purchase and sale agreements with unaffiliated third-party sellers to purchase a 100% interest in 18 properties, subject to meeting certain criteria, for an aggregate purchase price of $160.4 million, exclusive of closing costs. As of March 31, 2016, Cole Capital had $3.0 million of property escrow deposits held by escrow agents in connection with these future property acquisitions, which may be forfeited if the transactions are not completed under certain circumstances. Cole Capital will be reimbursed by the assigned Cole REIT for amounts escrowed when the property is assigned to the respective Cole REIT.

Environmental Matters

In connection with the ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. The Company has not been notified by any governmental authority of any non-compliance, liability or other claim, and is not aware of any other environmental condition, in each case, that it believes will have a material adverse effect on the results of operations.

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Equity

3 Months Ended

Mar. 31, 2016

Equity [Abstract]

Equity

Equity

Common Stock and General Partner OP Units

The General Partner is authorized to issue up to 1.5 billion shares of Common Stock. As of March 31, 2016, the General Partner had approximately 904.8 million shares of Common Stock issued and outstanding.

Additionally, the Operating Partnership had approximately 904.8 million General Partner OP Units issued and outstanding as of March 31, 2016, corresponding to the General Partner’s outstanding shares of Common Stock.

Preferred Stock and Preferred OP Units

Series F Preferred Stock

On January 3, 2014, in connection with the merger of American Realty Capital Trust IV, Inc with and into a subsidiary of the OP (the “ARCT IV Merger”), 42.2 million shares of Series F Preferred Stock were issued, resulting in the Operating Partnership concurrently issuing 42.2 million General Partner Series F preferred units (“General Partner Series F Preferred Units”) to the General Partner, and 700,000 Series F Preferred Units (“Limited Partner Series F Preferred Units”) to holders of each outstanding unit of American Realty Capital Operating Partnership IV, L.P. (the “ARCT IV Operating Partnership”) (each, an “ARCT IV OP Unit”). As of March 31, 2016, there were approximately 42.8 million shares of Series F Preferred Stock (and approximately 42.8 million corresponding General Partner Series F Preferred Units) and 86,874 Limited Partner Series F Preferred Units issued and outstanding.

The Series F Preferred Stock will pay cumulative cash dividends at the rate of 6.70% per annum on their liquidation preference of $25.00 per share (equivalent to $1.675 per share on an annual basis). The Series F Preferred Stock is not redeemable by the Company before the fifth anniversary of the date on which such Series F Preferred Stock was issued (the “Initial Redemption Date”), except under circumstances intended to preserve the General Partner’s status as a REIT for federal and/or state income tax purposes and except upon the occurrence of a change of control. On and after the Initial Redemption Date, the General Partner may, at its option, redeem shares of the Series F Preferred Stock, in whole or from time to time in part, at a redemption price of $25.00 per share plus, subject to exceptions, any accrued and unpaid dividends thereon to the date fixed for redemption. The shares of Series F Preferred Stock have no stated maturity, are not subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless the General Partner redeems or otherwise repurchases them or they become convertible and are converted into Common Stock (or, if applicable, alternative consideration). The Series F Preferred Stock trades on the NYSE under the symbol “VER PRF”. The Series F Preferred Units contain the same terms as the Series F Preferred Stock.

Limited Partner OP Units

As of March 31, 2016 and 2015, the Operating Partnership had approximately 23.8 million of Limited Partner OP Units outstanding.

On March 11, 2015, the Company received redemption requests totaling approximately 13.1 million OP Units ($126.7 million based on a redemption price of $9.65) from certain affiliates of the Former Manager. The Company believes it has potential claims against recipients of those OP Units and has engaged in discussions with affiliates of the Former Manager regarding the redemption requests. Pending any resolution, the Company does not currently intend to satisfy any of the redemption requests. In light of the potential claims, since October 15, 2015, the OP has not paid distributions in respect of a substantial portion of the outstanding Limited Partner OP Units when the Common Stock dividends were otherwise paid.

Common Stock Dividends

On February 23, 2016, the Company’s board of directors declared a quarterly cash dividend of $0.1375 per share of common stock (equaling an annualized dividend rate of $0.55 per share) for the first quarter of 2016 to stockholders of record as of March 31, 2016, which was paid on April 15, 2016. An equivalent distribution by the Operating Partnership is applicable per OP unit.

Common Stock Repurchases

Under the General Partner’s Equity Plan (defined below), individuals have the option to have the General Partner repurchase shares vesting from awards made under the Equity Plan in order to satisfy the minimum federal and state tax withholding obligations. During the three months ended March 31, 2016, the General Partner repurchased 127,741 shares to satisfy the federal and state tax withholding on behalf of employees.

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Equity-based Compensation

3 Months Ended

Mar. 31, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Equity-based Compensation

Equity-based Compensation

Equity Plan

The General Partner has adopted an equity plan (the “Equity Plan”), which provides for the grant of stock options, stock appreciation rights, restricted shares of Common Stock (“Restricted Shares”), restricted stock units (“Restricted Stock Units”), dividend equivalent rights and other stock-based awards to the General Partner’s and its affiliates’ non-executive directors, officers and other employees and advisors or consultants who are providing services to the General Partner or its affiliates. To date, the General Partner has granted fully vested shares of Common Stock, Restricted Shares, Restricted Stock Units and Deferred Stock Units (defined below) under the Equity Plan. Restricted Shares provide for rights identical to those of Common Stock. Restricted Stock Units do not provide for any rights of a common stockholder prior to the vesting of such Restricted Stock Units. In accordance with U.S. GAAP, Restricted Shares are considered issued and outstanding. As is the case when fully vested shares of Common Stock are issued from the Equity Plan, for each Restricted Share awarded under the Equity Plan, the Operating Partnership issues a General Partner OP Unit to the General Partner with identical terms. Upon vesting of Restricted Stock Units, the Operating Partnership issues a General Partner OP Unit to the General Partner for each share of Common Stock issued as a result of such vesting.

The General Partner has authorized and reserved a total number of shares equal to 10.0% of the total number of issued and outstanding shares of Common Stock (on a fully diluted basis assuming the redemption of all OP Units for shares of Common Stock) to be issued at any time under the Equity Plan for equity incentive awards. As of March 31, 2016, the General Partner had cumulatively awarded under its Equity Plan approximately 4.2 million Restricted Shares, net of the forfeiture of 3.5 million Restricted Shares through that date, 3.6 million Restricted Stock Units, net of the forfeiture of 0.4 million Restricted Stock Units through that date, and 0.1 million Deferred Stock Units, collectively representing approximately 7.9 million shares of Common Stock. Accordingly, as of such date, approximately 85.0 million additional shares were available for future issuance.

Restricted Shares

The Company has issued Restricted Shares to certain employees and non-executive directors beginning in 2011. In addition, the Company issued Restricted Shares to employees of affiliates of the Former Manager prior to 2015. The fair value of the Restricted Shares granted to employees under the Equity Plan is generally determined using the closing stock price on the grant date and is expensed over the requisite service period on a straight-line basis. The fair value of Restricted Shares granted to non-executive directors and employees of affiliates of the Former Manager under the Equity Plan was measured based upon the fair value of goods or services received or the equity instruments granted, whichever was more reliably determinable, and was expensed in full at the date of grant.

During the three months ended March 31, 2016, the Company recorded $0.3 million of compensation expense related to the Restricted Shares, which is recorded in general and administrative expense in the accompanying consolidated statements of operations.

The following table details the activity of the Restricted Shares during the three months ended March 31, 2016:

	Restricted Shares		Weighted-Average Grant Date Fair Value
Unvested shares, December 31, 2015	1,239,662		$	13.86
Vested	(363,973	)	14.12
Forfeited	(7,253	)	14.02
Unvested shares, March 31, 2016	868,436		$	13.75

Time-Based Restricted Stock Units

Under the Equity Plan, the Company may award Restricted Stock Units to employees that will vest if the recipient maintains his/her employment over the requisite service period (the “Time-Based Restricted Stock Units”). The fair value of the Time-Based Restricted Stock Units granted to employees under the Equity Plan is generally determined using the closing stock price on the grant date and is expensed over the requisite service period on a straight-line basis, which is generally three years. During the three months ended March 31, 2016, the Company recorded $0.6 million of compensation expense related to the Time-Based Restricted Stock Units, which is recorded in general and administrative expense in the accompanying consolidated statements of operations.

Deferred Stock Units

The Company may award Deferred Stock Units to non-executive directors under the Equity Plan (the “Deferred Stock Units”). Each Deferred Stock Unit represents the right to receive one share of Common Stock. The Deferred Stock Units provide for immediate vesting on the grant date and will be settled with Common Stock either on the earlier of the date on which the respective director separates from the Company or the third anniversary of the grant date, or if granted pursuant to the director’s voluntary election to participate in the director’s deferred compensation program, on the date the director separates from the Company. The fair value of the Deferred Stock Units is determined using the closing stock price on the grant date and is expensed over the requisite service period or on the grant date for awards with no requisite service period. During the three months ended March 31, 2016, the Company recorded approximately $33,700 of expense related to Deferred Stock Units, which is recorded in general and administrative expense in the accompanying consolidated statements of operations. The service inception date of these Deferred Stock Units preceded the grant date, which is subsequent to March 31, 2016.

The following table details the activity of the Time-Based Restricted Stock Units and Deferred Stock Units during the three months ended March 31, 2016.

	Time-Based Restricted Stock Units		Weighted-Average Grant Date Fair Value		Deferred Stock Units	Weighted-Average Grant Date Fair Value
Unvested units, December 31, 2015	589,138		$	9.61	—	$	—
Granted	725,921		7.81		—	—
Vested	(7,965	)	9.76		—	—
Unvested units, March 31, 2016	1,307,094		$	8.61	—	$	—

Market-Based Restricted Stock Units

During the year ended December 31, 2015, the General Partner awarded Restricted Stock Units to certain employees under the Equity Plan that are contingent upon the Common Stock reaching a certain market price (the “Market-Based Restricted Stock Units”). The Market-Based Restricted Stock Units are contingent upon the closing price of the Common Stock exceeding $10 per share for 20 consecutive trading days (the “Market Condition”) and continued employment as of such date on which the Market Condition is met. If the Market Condition is not satisfied by December 31, 2017, the Market-Based Restricted Stock Units will become null and void. The fair value and derived service period of the Market-Based Restricted Stock Units as of their grant date is determined using a Monte Carlo simulation, which takes into account multiple input variables that determine the probability of satisfying the Market Condition. The method requires the input of assumptions, including the future dividend yield and expected volatility of the Common Stock. Compensation expense is recognized on a straight-line basis over the derived service period regardless of whether the Market Condition is satisfied, provided that the requisite service condition has been achieved. The Market-Based Restricted Stock Units were fully expensed during the year ended December 31, 2015, however the Company may record contra-expense due to the forfeiture of such awards. During the three months ended March 31, 2016, the Company recorded contra-expense of $0.2 million related to the Market-Based Restricted Stock Units which is recorded in general and administrative expense in the accompanying consolidated statements of operations.

Long-Term Incentive Awards

The General Partner may award long-term incentive-based Restricted Stock Units (the “LTI Target Awards”) to employees under the Equity Plan. Vesting of the LTI Target Awards is based upon the General Partner’s level of achievement of total stockholder return (“TSR”), including both share price appreciation and Common Stock dividends, as measured equally against a market index and against a peer group generally over a three year period.

The fair value and derived service period of the LTI Target Awards as of their grant date is determined using a Monte Carlo simulation which takes into account multiple input variables that determine the probability of satisfying the required TSR, as outlined in the award agreements. This method requires the input of assumptions, including the future dividend yield, the expected volatility of the Common Stock and the expected volatility of the market index constituents and the peer group. Compensation expense is recognized on a straight-line basis over the derived service period regardless of whether the necessary TSR is attained, provided that the requisite service condition has been achieved. During the three months ended March 31, 2016, the Company recorded $1.0 million of expense related to the LTI Target Awards, which is recorded in general and administrative expense in the accompanying consolidated statements of operations.

The following table details the activity of the unvested Market-Based Restricted Stock Units and the LTI Target Awards during the three months ended March 31, 2016.

	Market-Based Restricted Stock Units		Weighted-Average Grant Date Fair Value		LTI Target Awards	Weighted-Average Grant Date Fair Value
Unvested units, December 31, 2015	704,804		$	8.58	731,448	$	11.38
Granted	—		—		850,942	7.13
Forfeited	(25,677	)	8.58		—	—
Unvested units, March 31, 2016	679,127		$	8.58	1,582,390	$	9.09

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Related Party Transactions and Arrangements

3 Months Ended

Mar. 31, 2016

Related Party Transactions [Abstract]

Related Party Transactions and Arrangements

Related Party Transactions and Arrangements

Cole Capital

Cole Capital is contractually responsible for managing the Cole REITs’ affairs on a day-to-day basis, identifying and making acquisitions and investments on the Cole REITs’ behalf, and recommending to the respective board of directors of each of the Cole REITs an approach for providing investors with liquidity. In addition, the Company distributes the shares of common stock for certain Cole REITs and advises them regarding offerings, manages relationships with participating broker-dealers and financial advisors and provides assistance in connection with compliance matters relating to the offerings. The Company receives compensation and reimbursement for services relating to the Cole REITs’ offerings and the investment, management and disposition of their respective assets, as applicable.

Offering-Related Revenue

The Company generally receives a selling commission and dealer manager or distribution fee based on the gross offering proceeds related to the sale of shares of the Cole REITs’ common stock in their primary offerings, before reallowance of commissions earned by participating broker-dealers. The Company has reallowed 100% of selling commissions earned to participating broker-dealers. The Company, in its sole discretion, may reallow all or a portion of its dealer manager fee to such participating broker-dealers as a marketing and due diligence expense reimbursement, based on factors such as the volume of shares issued by such participating broker-dealers and the amount of marketing support provided by such participating broker-dealers. No selling commissions or dealer manager fees are paid to the Company or other broker-dealers with respect to shares issued under the respective Cole REIT’s distribution reinvestment plan, under which the stockholders may elect to have distributions reinvested in additional shares.

All other organization and offering expenses associated with the sale of the Cole REITs’ common stock are paid for in advance by the Company and subject to reimbursement by the Cole REITs, up to certain limits in accordance with their respective advisory agreements and charters. As these costs are incurred, they are recorded as reimbursement revenue, up to the respective limit, and are included in offering-related revenues in the financial results for Cole Capital. Expenses paid on behalf of the Cole REITs in excess of these limits that are expected to be collected based on future estimated offering proceeds are recorded as program development costs, which are included in rent and tenant receivables and other assets, net in the accompanying consolidated balance sheets. The Company assesses the collectability of the program development costs, considering the offering period and historical and forecasted sales of shares under the Cole REITs’ respective offerings and reserves for any balances considered not collectible. Additional reserves are generally recorded if actual proceeds raised from the offerings and corresponding program development costs incurred differ from management’s assumptions. As of March 31, 2016 and December 31, 2015, the Company had organization and offering costs recorded as program development costs, included in rent and tenant receivables and other assets, net in the consolidated balance sheets, of $13.6 million and $12.9 million, respectively, which were net of reserves of $37.8 million and $34.8 million, respectively.

The following table shows the offering fee summary information for the Cole REITs as of March 31, 2016:

Program	Selling Commissions (1)	Dealer Manager and Distribution Fees (2)
Open Programs
CCPT V	7%	2%
INAV (3)
Wrap Class Shares	—%	0.55%
Advisor Class Shares	up to 3.75%	0.55% and 0.50%
Institutional Class Shares	—%	0.25%
CCIT II	7%	2%

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(1) The Company reallows 100% of selling commissions earned to participating broker-dealers.

(2) The Company may reallow all or a portion of its dealer manager fee or applicable distribution fee to participating broker-dealers as a marketing and due diligence expense reimbursement.

(3) In connection with the INAV offering, the Company receives selling commissions, an asset-based dealer manager fee and/or an asset-based distribution fee, all based on the net asset value for each class of common stock.

Transaction Service Revenue

The Company earns acquisition fees related to the acquisition, development or construction of properties on behalf of certain of the Cole REITs. In addition, the Company is reimbursed for acquisition expenses incurred in the process of acquiring properties up to certain limits per the respective advisory agreement. The Company is not reimbursed for personnel costs in connection with services for which it receives acquisition fees or real estate commissions. In addition, the Company may earn disposition fees related to the sale of one or more properties, including those held indirectly through joint ventures, on behalf of a Cole REIT and other affiliates.

The following table shows the transaction-related fees for the Cole REITs and other real estate programs as of March 31, 2016:

Program	Acquisition Fees (1)	Disposition Fees	Performance Fees (2)
Open Programs
CCPT V	2%	1%	15%
INAV	—	—	—
CCIT II	2%	1%	15%
Closed Programs
CCPT IV	2%	1%	15%
Other Programs	Various	Various	Various

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(1) Percent taken on gross purchase price.

(2) Performance fee paid only under the following circumstances: (i) if shares are listed on a national securities exchange; (ii) if the respective Cole REIT is sold or the assets are liquidated; or (iii) upon termination of the advisory agreement. In connection with such events, the performance fee will only be earned upon the return to investors of their net capital invested and an 8% annual cumulative, non-compounded return (6% in the case of CCPT V).

Management Service Revenue

The Company earns advisory and asset and property management fees from certain Cole REITs and other real estate programs. The Company may also be reimbursed for expenses incurred in providing advisory and asset and property management services, subject to certain limitations. In addition, the Company earns a performance fee relating to INAV for any year in which the total return on stockholders’ capital exceeds 6% per annum on a calendar year basis.

The following table shows the management fees for the Cole REITs as of March 31, 2016:

Program	Asset Management / Advisory Fees (1)	Performance Fees (2)
Open Programs
CCPT V	0.65% - 0.75%	—
INAV	0.90%	25%
CCIT II	0.65% - 0.75%	—
Closed Programs
CCPT IV	0.65% - 0.75%	—
Other Programs	Various	—

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(1) Annualized fee based on the average monthly invested assets or net asset value, if available.

(2) Performance fee paid on the amount in which the total return on stockholders’ capital exceeds 6% per annum on a calendar year basis.

The table below reflects the revenue earned from the Cole REITs (including closed programs, as applicable) and joint ventures for the three months ended March 31, 2016 and 2015 (in thousands).

	Three Months Ended March 31,
	2016		2015
Offering-related fees and reimbursements
Securities commissions (1)	$	7,041	$	1,775
Dealer manager and distribution fees (2)	2,640		716
Reimbursement revenue	2,710		626
Offering-related fees and reimbursements	12,391		3,117
Transaction service fees and reimbursements
Acquisition fees	1,702		4,488
Disposition fees (3)	—		4,350
Reimbursement revenues	682		571
Transaction service fees and reimbursements	2,384		9,409
Management fees and reimbursements
Asset and property management fees and leasing fees	55		103
Advisory and performance fee revenue	12,050		11,173
Reimbursement revenues	4,123		2,518
Management fees and reimbursements	16,228		13,794
Interest income on Affiliate Lines of Credit	308		408
Total related party revenues(4)	$	31,311	$	26,728

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(1) The Company reallows 100% of selling commissions earned to participating broker-dealers.

(2) During the three months ended March 31, 2016 and 2015, the Company reallowed $1.0 million and $0.3 million, respectively, of dealer manager fees to participating broker dealers as a marketing and due diligence expense reimbursement.

(3) The Company earned a disposition fee of $4.4 million on behalf of CCIT when it merged with Select Income REIT on January 29, 2015.

(4) Total related party revenues excludes fees earned from 1031 real estate programs of $0.2 million and $1.2 million for the three months ended March 31, 2016 and 2015, respectively.

Investment in the Cole REITs

As of March 31, 2016 and December 31, 2015, the Company owned aggregate equity investments of $3.8 million and $4.1 million, respectively, in the Cole REITs and other affiliated offerings. The Company accounts for these investments using the equity method of accounting which requires the investment to be initially recorded at cost and subsequently adjusted for the Company’s share of equity in the respective Cole REIT’s earnings and distributions. The Company records its proportionate share of net income from the Cole REITs in other income, net in the consolidated statements of operations. During the three months ended March 31, 2016 and 2015, the Company recognized $122,000 and $44,000 of net loss, respectively, from the Cole REITs.

The table below presents certain information related to the Company’s investments in the Cole REITs as of March 31, 2016 (carrying amount in thousands):

	March 31, 2016
Cole REIT	% of Outstanding Shares Owned	Carrying Amount of Investment
CCPT V	1.14%	$	1,553
INAV	0.12%	149
CCIT II	0.58%	1,388
CCPT IV	0.01%	119
Funds not yet in offering	N/A	600
		$	3,809

Due to Affiliates

Due to affiliates, as reported in the accompanying consolidated balance sheets, of $0.2 million as of December 31, 2015, related to amounts due to the Cole REITs for expense reimbursements. As of March 31, 2016, there was no such balance due to affiliates.

Due from Affiliates

As of March 31, 2016 and December 31, 2015, $11.6 million and $10.6 million, respectively, was expected to be collected from affiliates, excluding balances from the Cole REITs’ lines of credit, discussed below, related to services provided by the Company and expenses subject to reimbursement by the Cole REITs in accordance with their respective advisory and property management agreements.

As of December 31, 2015, the Company had revolving line of credit agreements in place with CCIT II and CCPT V (the “Affiliate Lines of Credit”) that provided for maximum borrowings of $60.0 million to each of CCIT II and CCPT V and bore variable interest rates of one-month LIBOR plus 2.20%. As of December 31, 2015, there was $50.0 million outstanding on the Affiliate Lines of Credit. During the three months ended March 31, 2016, the Company amended the agreement with CCIT II to extend the maturity date to June 30, 2016 and reduce the maximum borrowing to $30.0 million. During the three months ended March 31, 2016, the agreement with CCPT V matured, at which time CCPT V repaid the outstanding balance of $20.0 million. Additionally, CCIT II paid down the $30.0 million outstanding on its line of credit during the three months ended March 31, 2016.

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Net Loss Per Share/Unit

3 Months Ended

Mar. 31, 2016

Earnings Per Share [Abstract]

Net Loss Per Share/Unit

Net Loss Per Share/Unit

The General Partner’s unvested Restricted Shares contain non-forfeitable rights to dividends and are considered to be participating securities in accordance with U.S. GAAP and, therefore, are included in the computation of earnings per share under the two-class computation method. Under the two-class computation method, net losses are not allocated to participating securities unless the holder of the security has a contractual obligation to share in the losses. The unvested Restricted Shares are not allocated losses as the awards do not have a contractual obligation to share in losses of the General Partner. The two-class computation method is an earnings allocation formula that determines earnings per share for each class of shares of Common Stock and participating securities according to dividends declared (or accumulated) and participation rights in undistributed earnings.

Net Loss Per Share

The following is a summary of the basic and diluted net loss per share computation for the General Partner for the three months ended March 31, 2016 and 2015 (dollar amounts in thousands, except for share and per share data):

	Three Months Ended March 31,
	2016			2015
Net loss attributable to the General Partner	$	(113,086	)	$	(29,970	)
Less: dividends to preferred shares and participating securities	18,098			17,978
Net loss attributable to common stockholders	$	(131,184	)	$	(47,948	)
Weighted average number of common stock outstanding - basic and diluted	903,825,726			902,996,270
Basic and diluted net loss per share attributable to common stockholders	$	(0.15	)	$	(0.05	)

As of March 31, 2016, approximately 23.8 million OP Units were outstanding, which are convertible into an equal number of shares of Common Stock, and approximately 4.4 million of unvested Restricted Shares and unvested Restricted Stock Units were excluded from the calculation of diluted net loss per share as the effect would have been antidilutive.

Net Loss Per Unit

The following is a summary of the basic and diluted net loss per unit computation for the OP for the three months ended March 31, 2016 and 2015 (dollar amounts in thousands, except for unit and per unit data):

	Three Months Ended March 31,
	2016			2015
Net loss attributable to the Operating Partnership	$	(116,041	)	$	(30,873	)
Less: dividends to preferred units and participating securities	18,098			17,978
Net loss attributable to common unitholders	$	(134,139	)	$	(48,851	)
Weighted average number of common units outstanding - basic and diluted	927,589,523			926,760,067
Basic and diluted net loss per unit attributable to common unitholders	$	(0.15	)	$	(0.05	)

As of March 31, 2016, approximately 4.4 million shares of unvested restricted units were excluded from the calculation of diluted net loss per unit as the effect would have been antidilutive.

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Income Taxes

3 Months Ended

Mar. 31, 2016

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

As a REIT, the General Partner generally is not subject to federal income tax, with the exception of its TRS entities. However, the General Partner, including its TRS entities, and the Operating Partnership are still subject to certain state and local income and franchise taxes in the various jurisdictions in which they operate.

Cole Capital Income Taxes

Based on the above, Cole Capital’s business, substantially all of which is conducted through a TRS, recognized a benefit of $1.3 million and a provision of $0.2 million for the three months ended March 31, 2016 and 2015, respectively, which are included in provision for income taxes in the accompanying consolidated statements of operations.

REI Income Taxes

The REI segment recognized a provision of $1.4 million and $1.9 million for the three months ended March 31, 2016 and 2015, respectively, which are included in provision for income taxes in the accompanying consolidated statements of operations.

The Company had no unrecognized tax benefits as of or during the three months ended March 31, 2016 and 2015. Any interest and penalties related to unrecognized tax benefits would be recognized in provision for income taxes in the accompanying consolidated statements of operations. The Company files income tax returns in the U.S. federal jurisdiction, Canadian federal jurisdiction and various state and local jurisdictions, and is subject to routine examinations by the respective tax authorities. With few exceptions, the Company is no longer subject to federal or state examinations by tax authorities for years before 2011.

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Subsequent Events

3 Months Ended

Mar. 31, 2016

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

The following events occurred subsequent to March 31, 2016:

Real Estate Investment Activity

From April 1, 2016 through May 3, 2016, the Company disposed of 28 properties for an aggregate gross sales price of $48.2 million and an estimated gain of $3.8 million.

Common Stock Dividend

On May 4, 2016, the Company’s board of directors declared a quarterly cash dividend of $0.1375 per share of common stock (equaling an annualized dividend rate of $0.55 per share) for the second quarter of 2016 to stockholders of record as of June 30, 2016, which will be paid on July 15, 2016. An equivalent distribution by the Operating Partnership is applicable per OP unit.

Preferred Stock Dividend

On May 4, 2016, the Company’s board of directors declared a monthly cash dividend to holders of the Series F Preferred Stock for July 2016 through September 2016 in respect to the periods included in the table below. The corresponding record and payment dates for each month's Series F Preferred Stock dividend are also shown in the table below.  The dividend for the Series F Preferred Stock accrues daily on a 360-day annual basis equal to an annualized dividend rate of $1.675 per share, or $0.1395833 per 30-day month.

Period	Record Date	Payment Date
June 15, 2016 - July 14, 2016	July 1, 2016	July 15, 2016
July 15, 2016 - August 14, 2016	August 1, 2016	August 15, 2016
August 15, 2016 - September 14, 2016	September 1, 2016	September 15, 2016

New Cole REIT Share Class

Commencing on April 29, 2016, two of the Cole REITs, CCIT II and CCPT V, began offering Class T shares of common stock (the “Class T Shares”) in addition to the class of shares of common stock already being offered (now referred to as Class A shares). The Class T Shares are subject to selling commissions of 3.0% of the respective Cole REIT’s gross offering proceeds in their primary offering and dealer manager fees of 2.0% of the respective Cole REIT’s gross offering proceeds in their primary offering, before reallowance of commissions earned by participating broker-dealers. In addition, Class T Shares purchased in the respective Cole REIT’s primary offering will pay a distribution and stockholder servicing fee, which accrues daily in the amount of 1/365th of 0.8% of the respective Cole REIT’s estimated net asset value of Class T Shares and will be paid monthly in arrears.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2016

Accounting Policies [Abstract]

Basis of Accounting

The consolidated financial statements of the Company presented herein include the accounts of the General Partner and its consolidated subsidiaries, including the OP. All intercompany transactions have been eliminated upon consolidation. The financial statements are prepared on the accrual basis of accounting in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). The information furnished includes all adjustments and accruals of a normal recurring nature, which, in the opinion of management, are necessary for a fair presentation of results for the interim periods. The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results for the entire year or any subsequent interim period.

These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of and for the year ended December 31, 2015 of the Company, which are included in the Company’s Annual Report on Form 10-K filed February 24, 2016. There have been no significant changes to the Company’s significant accounting policies during the three months ended March 31, 2016. Information and footnote disclosures normally included in financial statements have been condensed or omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”).

Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of the Company and its subsidiaries and consolidated joint venture arrangements. The portions of the consolidated joint venture arrangements not owned by the Company are presented as non-controlling interests in VEREIT’s and the OP’s consolidated balance sheets, statements of operations, statements of comprehensive income (loss) and statements of changes in equity. In addition, as described in Note 1 – Organization, certain third parties have been issued OP Units. Holders of OP Units are considered to be non-controlling interest holders in the OP and their ownership interest in the limited partner’s share is presented as non-controlling interests in VEREIT’s consolidated balance sheets, statements of operations, statements of comprehensive income (loss) and statements of changes in equity. Further, a portion of the earnings and losses of the OP are allocated to non-controlling interest holders based on their respective ownership percentages. Upon conversion of OP Units to Common Stock, any difference between the fair value of shares of Common Stock issued and the carrying value of the OP Units converted is recorded as a component of equity. As of both March 31, 2016 and December 31, 2015, there were approximately 23.8 million Limited Partner OP Units outstanding.

During the year ended December 31, 2015, the Company early adopted the U.S. Financial Accounting Standards Board (the “FASB”) Accounting Standards Update, (“ASU”) No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis (“ASU 2015-02”), which simplifies consolidation accounting by reducing the number of consolidation models and changing various aspects of current U.S. GAAP, including certain consolidation criteria for a variable interest entity (“VIE”). For legal entities being evaluated for consolidation, the Company must first determine whether the interests that it holds and fees it receives qualify as variable interests in the entity. A variable interest is an investment or other interest that will absorb portions of an entity’s expected losses or receive portions of the entity’s expected residual returns. The Company’s evaluation includes consideration of fees paid to the Company where the Company acts as a decision maker or service provider to the entity being evaluated. If the Company determines that it holds a variable interest in an entity, it evaluates whether that entity is a VIE. VIEs are entities where investors lack sufficient equity at risk for the entity to finance its activities without additional subordinated financial support or where equity investors, as a group, lack one of the following characteristics: (a) the power to direct the activities that most significantly impact the entity’s economic performance, (b) the obligation to absorb the expected losses of the entity, or (c) the right to receive the expected returns of the entity.

The Company then qualitatively assesses whether it is (or is not) the primary beneficiary of a VIE, which is generally defined as the party who has a controlling financial interest in the VIE. Consideration of various factors include, but are not limited to, the Company’s ability to direct the activities that most significantly impact the entity’s economic performance and its obligation to absorb losses from or right to receive benefits of the VIE that could potentially be significant to the VIE. The Company consolidates any VIEs when the Company is determined to be the primary beneficiary of the VIE and the difference between consolidating the VIE and accounting for it using the equity method could be material to the Company’s consolidated financial statements. The Company continually evaluates the need to consolidate these VIEs based on standards set forth in U.S. GAAP as described above.

Reclassification

As described below, the following items previously reported have been reclassified to conform with the current period’s presentation.

The land and construction in progress line item from prior periods has been combined into the land caption in the consolidated balance sheets. The gain on forgiveness of debt previously included in other income, net has been combined into the caption gain on extinguishment and forgiveness of debt, net in the consolidated statements of operations. Additionally, equity in income of unconsolidated joint ventures previously included in other income net, in the consolidated statements of operations has been included in a separate caption entitled equity in income and gain on disposition of unconsolidated entities. Further, the previous gain on investment securities line item has been included in other income, net in the consolidated statements of operations.

Finally, the designated derivatives, fair value adjustments line item from the prior years has been disaggregated within the consolidated statements of other comprehensive loss into the captions unrealized loss on interest rate derivatives and amount of loss reclassified from accumulated other comprehensive loss into net loss as interest expense. These captions were previously included within the notes to consolidated financial statements.

Restricted Cash

The Company had $60.1 million and $59.8 million, respectively, in restricted cash as of March 31, 2016 and December 31, 2015. Restricted cash primarily consists of reserves related to lease expirations, as well as maintenance, structural and debt service reserves. Included in restricted cash at March 31, 2016 was $48.8 million in lender reserves and $11.3 million held in restricted lockbox accounts. Included in restricted cash at December 31, 2015 was $47.9 million in lender reserves and $11.9 million held in restricted lockbox accounts. As part of certain debt agreements, rent from certain of the Company’s tenants is deposited directly into a lockbox account, from which the monthly debt service payments are disbursed to the lender and the excess funds are then disbursed to the Company.

Revenue Recognition - REI and Cole Capital

The Company’s revenues, which primarily consist of rental income, include rents that each tenant pays in accordance with the terms of each lease reported on a straight-line basis over the initial non-cancelable term of the lease. When the Company acquires a property, the term of each existing lease is considered to commence as of the acquisition date for the purposes of this calculation. Since many of the leases provide for rental increases at specified intervals, straight-line basis accounting requires the Company to record a receivable, and include in revenues, unbilled rent receivables that the Company will only receive if the tenant makes all rent payments required through the expiration of the initial term of the lease. Straight-line rent receivables are included in rent and tenant receivables and other assets, net, in the consolidated balance sheets. See Note 8 – Rent and Tenant Receivables and Other Assets, Net. Cost recoveries from tenants are included in operating expense reimbursements in the consolidated statements of operations in the period the related costs are incurred. The Company defers the revenue related to lease payments received from tenants in advance of their due dates. As of March 31, 2016 and December 31, 2015, the Company had $67.3 million and $67.2 million, respectively, of deferred rental income, which is included in deferred rent, derivative and other liabilities in the consolidated balance sheets.

The Company continually reviews receivables related to rent and unbilled rent receivables and determines collectability by taking into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. In the event that the collectability of a receivable is uncertain, the Company will record an increase in the allowance for uncollectible accounts in the consolidated balance sheets or record a direct write-off of the receivable in the consolidated statements of operations as a reduction to rental income. As of March 31, 2016 and December 31, 2015, the Company maintained an allowance for uncollectible accounts of $7.9 million and $6.6 million, respectively.

Revenue Recognition – Cole Capital

Revenue consists of securities sales commissions and dealer manager fees, real estate acquisition fees, property management fees, advisory fees, asset management fees and performance fees for services relating to the Cole REITs’ offerings and the investment and management of their respective assets, in accordance with the respective dealer manager and advisory agreements. The Company records revenue related to acquisition fees, securities sales commissions and dealer manager fees upon completion of a transaction and advisory, asset and property management fees as services are performed. The Company also earns property management, asset management and disposition fees from certain joint ventures and other real estate programs. The Company is also reimbursed for certain costs incurred in providing these services. Securities sales commissions and dealer manager reimbursements are recorded as revenue as the expenses are incurred, as long as reimbursement is reasonably assured. The Company, in its sole discretion, may reallow all or a portion of its dealer manager fee to such participating broker-dealers as a marketing and due diligence expense reimbursement, based on factors such as the volume of shares issued by such participating broker-dealers and the amount of marketing support provided by such participating broker-dealers.

Acquisition Related Expenses and Litigation and Other Non-routine Costs

All costs incurred as a result of a business combination are classified as acquisition related expenses or merger and other non-routine transaction related expenses and expensed as incurred. Acquisition related expenses include legal and other transaction related costs incurred in connection with self-originated acquisitions, including purchases of portfolios. In addition, indirect costs, such as internal salaries, that are tracked and documented in a manner that clearly indicates that the activities driving the cost directly relate to activities necessary to complete, or effect, self-originating purchases are classified as acquisition related expenses.

Similar costs incurred in relation to mergers, which are not considered self-originating purchases, and other non-routine transaction related expenses are included in litigation and other non-routine costs, net of insurance recoveries in the consolidated statements of operations.

Income Taxes

The General Partner currently qualifies and has elected to be taxed as a REIT for U.S. federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code. As a REIT, except as discussed below, the General Partner generally is not subject to federal income tax on taxable income that it distributes to its stockholders so long as it distributes at least 90% of its annual taxable income (computed without regard to the deduction for dividends paid and excluding net capital gains). REITs are subject to a number of other organizational and operational requirements. Even if the General Partner maintains its qualification for taxation as a REIT, it may be subject to certain state and local taxes on its income and property, federal income taxes on certain income and excise taxes on its undistributed income.

The OP is classified as a partnership for U.S. federal income tax purposes. As a partnership, the OP is not a taxable entity for U.S. federal income tax purposes. Instead, each partner in the OP is required to take into account its allocable share of the OP’s income, gains, losses, deductions and credits for each taxable year. However, the OP may be subject to certain state and local taxes on its income and property.

As of March 31, 2016, the OP and the General Partner had no material uncertain income tax positions. The tax years subsequent to and including the fiscal year ended December 31, 2011 remain open to examination by the major taxing jurisdictions to which the OP, the General Partner, American Realty Capital Trust III, Inc. (“ARCT III”), CapLease, Inc. (“CapLease”), American Realty Capital Trust IV, Inc., (“ARCT IV”), Cole Real Estate Investments, Inc. (“Cole”) and Cole Credit Property Trust, Inc. are subject.

Under the LPA, the OP is to conduct business in such a manner as to permit the General Partner at all times to qualify as a REIT.

The Company conducts substantially all of its Cole Capital segment business activities through a TRS. A TRS is a subsidiary of a REIT that is subject to corporate federal, state and local income taxes, as applicable. The Company’s use of a TRS enables it to engage in certain business activities while complying with the REIT qualification requirements and to retain any income generated by these businesses for reinvestment without the requirement to distribute those earnings. The Company conducts all of its business in the United States and Canada and, as a result, it files income tax returns in the U.S. federal jurisdiction, the Canadian federal jurisdiction and various state and local jurisdictions. Certain of the Company’s inter-company transactions that have been eliminated in consolidation for financial accounting purposes are also subject to taxation.

The Company provides for income taxes in accordance with current authoritative accounting and tax guidance. The tax provision or benefit related to significant or unusual items is recognized in the quarter in which those items occur. In addition, the effect of changes in enacted tax laws, rates or tax status is recognized in the quarter in which the change occurs. The accounting estimates used to compute the provision for or benefit from income taxes may change as new events occur, additional information is obtained or the tax environment changes.

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which supersedes the revenue recognition requirements in Revenue Recognition, Accounting Standards Codification (“ASC”) (Topic 605) and requires an entity to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, an amendment to ASU 2014-09, ASU 2015-14, was issued to defer the effective date for all entities by one year. For public business entities, certain not-for-profit entities and certain employee benefit plans, the guidance should be applied to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company is currently evaluating the impact of the new standard on its financial statements.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments(Subtopic 825-10), which requires all equity investments to be measured at fair value with changes in the fair value recognized through net income (other than those accounted for under equity method of accounting or those that result in consolidation of the investee). The amendments in this update also require an entity to present separately in other comprehensive income, the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. In addition, the amendments in this update require separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. The Company is currently evaluating the impact that this new guidance will have on its financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which will require that a lessee recognize assets and liabilities on the balance sheet for all leases with a lease term of more than 12 months, with the result being the recognition of a right of use asset and a lease liability and the disclosure of key information about the entity's leasing arrangements. ASU 2016-02 retains a distinction between finance leases (i.e. capital leases under current U.S. GAAP) and operating leases. The classification criteria for distinguishing between finance leases and operating leases will be substantially similar to the classification criteria for distinguishing between capital leases and operating leases under current U.S. GAAP. The amendments in ASU 2016-02 are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. A modified retrospective approach is required for existing leases that have not expired upon adoption. The Company is currently evaluating the impact this amendment will have on its consolidated financial statements.

In March of 2016, the FASB issued ASU No. 2016-05, Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships (Topic 815). The amendments in this update clarify that a change in the counterparty to a derivative instrument that has been designated as the hedging instrument does not, in and of itself, require de-designation of that hedging relationship provided that all other hedge accounting criteria continue to be met. These provisions are effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact this amendment will have on its consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvement to Employee Share-Based Payment Accounting, which affects entities that issue share-based payment awards to their employees. The ASU is designed to simplify several aspects of accounting for share-based payment award transactions including the income tax consequences, classification of awards as either equity or liabilities, classification on the statement of cash flows and forfeiture rate calculations. The guidance will be effective for annual reporting periods beginning after December 15, 2016 and interim periods within those fiscal years with early adoption permitted. The Company has elected to early adopt this guidance during the first quarter of 2016, which does not have a material effect on the Company’s consolidated financial statements. In connection with the adoption, the Company has modified the consolidated statement of changes in equity to include the line item cumulative-effect adjustment for equity-based compensation forfeitures, which represents application of the accounting change on a modified retrospective basis.

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Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2016

Accounting Policies [Abstract]

Litigation and Other Non-Routine Transaction Related Expenses

Litigation and other non-routine transaction related expenses include the following costs (amounts in thousands):

	Three Months Ended March 31,
	2016			2015
Other non-routine transaction related expenses:
Audit Committee Investigation and related matters (1)	$	4,742		$	15,316
Legal fees and expenses (2)	83			475
Other fees and expenses	—			632
Total costs incurred	4,825			16,423
Insurance recoveries	(10,000		)	—
Total	$	(5,175	)	$	16,423

___________________________________

(1) Includes all fees and costs associated with the previously-announced investigation conducted by the audit committee (the “Audit Committee”) of the General Partner’s board of directors (the “Audit Committee Investigation”) and various litigations and investigations prompted by the results of the Audit Committee Investigation, including fees and costs incurred pursuant to the Company’s indemnification obligations.

(2) Includes legal fees and expenses associated with litigation resulting from prior mergers.

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Segment Reporting (Tables)

3 Months Ended

Mar. 31, 2016

Segment Reporting [Abstract]

Summary of Comparative Financial Results and Total Assets

The following tables present a summary of the comparative financial results and total assets for each segment (in thousands):

	Three Months Ended March 31,
	2016			2015
REI segment:
Revenues:
Rental income	$	313,971		$	342,759
Direct financing lease income	569			741
Operating expense reimbursements	23,247			22,974
Total real estate investment revenues	337,787			366,474
Operating expenses:
Acquisition related	217			1,723
Litigation and other non-routine costs, net of insurance recoveries	(5,175		)	16,423
Property operating	34,813			30,999
General and administrative	12,228			15,370
Depreciation and amortization	195,991			210,788
Impairment of real estate	160,517			—
Total operating expenses	398,591			275,303
Operating (loss) income	$	(60,804	)	$	91,171
Other (expense) income:
Interest expense	$	(80,426	)	$	(95,699	)
Gain on extinguishment and forgiveness of debt, net	—			5,302
Other income, net	568			2,841
Equity in income and gain on disposition of unconsolidated entities	10,404			28
Loss on derivative instruments, net	(1,086		)	(1,028		)
Total other expenses, net	(70,540		)	(88,556		)
(Loss) income before taxes and real estate dispositions	(131,344		)	2,615
Gain (loss) on disposition of real estate, net	17,175			(31,368		)
Loss before taxes	(114,169		)	(28,753		)
Provision for income taxes	(1,365		)	(1,854		)
Net loss	$	(115,534	)	$	(30,607	)

	Three Months Ended March 31,
	2016			2015
Cole Capital segment:
Revenues:
Offering-related fees and reimbursements	$	12,391		$	3,117
Transaction service fees and reimbursements	2,384			10,260
Management fees and reimbursements	16,458			14,117
Total Cole Capital revenues	31,233			27,494
Operating expenses:
Cole Capital reallowed fees and commissions	8,068			2,031
Acquisition related	25			459
General and administrative	17,172			17,736
Depreciation and amortization	8,317			8,353
Total operating expenses	33,582			28,579
Operating loss	(2,349		)	(1,085		)
Total other income, net	494			1,219
(Loss) income before taxes	(1,855		)	134
Benefit from (provision for) income taxes	1,309			(220		)
Net loss	$	(546	)	$	(86	)
Total Company:
Total revenues	$	369,020		$	393,968
Total operating expenses	$	432,173		$	303,882
Total other expense, net	$	(70,046	)	$	(87,337	)
Net loss	$	(116,080	)	$	(30,693	)

	Total Assets
	March 31, 2016		December 31, 2015
REI segment	$	16,465,057	$	16,966,729
Cole Capital segment	378,555		439,137
Total Company	$	16,843,612	$	17,405,866

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Goodwill and Other Intangibles (Tables)

3 Months Ended

Mar. 31, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

The following table summarizes the Company’s goodwill activity by segment during the three months ended March 31, 2016 and 2015 (in thousands):

	REI Segment			Cole Capital Segment		Consolidated
Balance as of December 31, 2015	$	1,410,631		$	245,743	$	1,656,374
Goodwill allocated to dispositions and held for sale assets (1)	(13,516		)	—		$	(13,516	)
Balance as of March 31, 2016	$	1,397,115		$	245,743	$	1,642,858

	REI Segment			Cole Capital Segment		Consolidated
Balance as of December 31, 2014	1,509,396			385,398		1,894,794
Goodwill allocated to dispositions and held for sale assets (1)	(23,680		)	—		(23,680		)
Balance as of March 31, 2015	$	1,485,716		$	385,398	$	1,871,114

_______________________________________________

(1) Included in gain (loss) on disposition of real estate, net, in the consolidated statement of operations.

Schedule of Intangible Assets

Intangible lease assets and liabilities of the Company consisted of the following as of March 31, 2016 and December 31, 2015(amounts in thousands, except weighted-average useful life):

	Weighted-Average Useful Life	March 31, 2016		December 31, 2015
Intangible lease assets:
In-place leases, net of accumulated amortization of $405,753 and $398,770, respectively	13.5	$	1,381,547	$	1,458,354
Leasing commissions, net of accumulated amortization of $1,137 and $1,035, respectively	9.2	6,060		4,872
Above-market leases, net of accumulated amortization of $51,944 and $47,041, respectively	16.1	299,293		308,306
Total intangible lease assets, net		$	1,686,900	$	1,771,532
Intangible lease liabilities:
Below-market leases, net of accumulated amortization of $42,629 and $38,340, respectively	17.4	$	245,093	$	251,692

Schedule of Projected Amortization Expense and Adjustments

The following table provides the projected amortization expense and adjustments to rental income related to the intangible lease assets and liabilities for the next five years as of March 31, 2016 (amounts in thousands):

	April 1, 2016 - December 31, 2016		2017		2018		2019		2020
In-place leases:
Total to be included in amortization expense	$	168,216	$	154,275	$	141,317	$	129,711	$	120,676
Leasing Commissions
Total to be included in amortization expense	$	1,341	$	682	$	496	$	425	$	407
Above-market lease assets:
Total to be deducted from rental income	$	25,672	$	25,309	$	24,756	$	22,801	$	22,334
Below-market lease liabilities:
Total to be included in rental income	$	23,115	$	20,453	$	20,126	$	19,388	$	18,196

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Real Estate Investments (Tables)

3 Months Ended

Mar. 31, 2016

Real Estate [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table presents the allocation of the fair values of the assets acquired and liabilities assumed during the periods presented (in thousands):

	Three Months Ended March 31,
	2016		2015
Real estate investments, at cost:
Land	$	4,215	$	1,594
Buildings, fixtures and improvements	14,555		5,617
Total tangible assets	18,770		7,211
Acquired intangible assets:
In-place leases	1,182		416
Total purchase price of assets acquired	$	19,952	$	7,627

Schedule of Future Minimum Operating Lease Base Rent Payments

These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items (in thousands):

	Future Minimum Operating Lease Base Rent Payments		Future Minimum Direct Financing Lease Payments (1)
April 1, 2016 - December 31, 2016	$	882,655	$	3,338
2017	1,162,408		4,036
2018	1,131,580		3,016
2019	1,090,919		2,397
2020	1,050,467		2,023
Thereafter	7,870,665		5,893
Total	$	13,188,694	$	20,703

____________________________________

(1) 36 properties are subject to direct financing leases and, therefore, revenue is recognized as direct financing lease income on the discounted cash flows of the lease payments. Amounts reflected are the minimum base rental cash payments due to the Company under the lease agreements on these respective properties.

The following table reflects the minimum base rent payments due from the Company over the next five years and thereafter for certain ground lease obligations, which are substantially reimbursable by our tenants, and office lease obligations (in thousands):

	Future Minimum Base Rent Payments
	Ground Leases		Office Leases
April 1, 2016 - December 31, 2016	$	10,659	$	3,793
2017	14,820		4,585
2018	14,410		4,704
2019	14,146		4,769
2020	13,386		4,797
Thereafter	224,648		14,089
Total	$	292,069	$	36,737

Schedule of Future Minimum Direct Financing Lease Payments

These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items (in thousands):

	Future Minimum Operating Lease Base Rent Payments		Future Minimum Direct Financing Lease Payments (1)
April 1, 2016 - December 31, 2016	$	882,655	$	3,338
2017	1,162,408		4,036
2018	1,131,580		3,016
2019	1,090,919		2,397
2020	1,050,467		2,023
Thereafter	7,870,665		5,893
Total	$	13,188,694	$	20,703

____________________________________

(1) 36 properties are subject to direct financing leases and, therefore, revenue is recognized as direct financing lease income on the discounted cash flows of the lease payments. Amounts reflected are the minimum base rental cash payments due to the Company under the lease agreements on these respective properties.

Schedule of Capital Leased Assets

The components of the Company’s net investment in direct financing leases as of March 31, 2016 and December 31, 2015 are as follows (in thousands):

	March 31, 2016			December 31, 2015
Future minimum lease payments receivable	$	20,703		$	21,993
Unguaranteed residual value of property	31,562			31,562
Unearned income	(6,654		)	(7,243		)
Net investment in direct financing leases	$	45,611		$	46,312

Schedule of Future Construction Commitments

Below is a summary of the construction commitments as of March 31, 2016 (dollar amounts in thousands):

Development projects in progress	6
Investment to date	$	12,729
Estimated cost to complete (1)	4,563
Total Investment (2)	$	17,292

_______________________________________________

(1) The Company is contractually committed to fund a developer $1.4 million to complete the remaining two build-to-suit developments.

(2) Excludes tenant improvement costs incurred in accordance with existing leases. As of March 31, 2016, $3.2 million of tenant improvement costs were included in buildings, fixtures and improvements in the consolidated financial statements.

Summary of Unconsolidated Joint Ventures

The following is a summary of the Company’s percentage ownership and carrying amount related to each of the Unconsolidated Joint Ventures as of March 31, 2016 (dollar amounts in thousands):

Name of Joint Venture	Partner	Ownership % (1)	Carrying Amount of Investment (2)
Cole/Mosaic JV South Elgin IL, LLC	Affiliate of Mosaic Properties and Development, LLC	50%	$	6,452
Cole/Faison JV Bethlehem GA, LLC	Faison-Winder Investors, LLC	90%	13,185
			$	19,637

_______________________________________________

(1) The Company’s ownership interest in this table reflects its legal ownership interest. Legal ownership may, at times, not equal the Company’s economic interest in the listed properties because of various provisions in certain joint venture agreements regarding distributions of cash flow based on capital account balances, allocations of profits and losses and payments of preferred returns. As a result, the Company’s actual economic interest (as distinct from its legal ownership interest) in certain of the properties could fluctuate from time to time and may not wholly align with its legal ownership interests.

(2) The total carrying amount of the investments is greater than the underlying equity in net assets by $6.7 million. This difference relates to a purchase price allocation of goodwill and a step up in fair value of the investment assets acquired in connection with the Cole Merger. The step up in fair value was allocated to the individual investment assets and is being amortized in accordance with the Company’s depreciation policy.

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Investment Securities, at Fair Value (Tables)

3 Months Ended

Mar. 31, 2016

Investments, Debt and Equity Securities [Abstract]

Schedule of Unrealized Gains and Losses on Investment Securities

The following tables detail the unrealized gains and losses on investment securities as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
CMBS	$	48,934	$	1,146	$	(1,918	)	$	48,162

	December 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
CMBS	$	52,115	$	2,169	$	(980	)	$	53,304

Schedule of Maturity of CMBS

The scheduled maturity of the Company’s CMBS as of March 31, 2016 is as follows (in thousands):

	March 31, 2016
	Amortized Cost		Fair Value
Due within one year	$	—	$	—
Due after one year through five years	21,656		22,316
Due after five years through 10 years	12,508		10,664
Due after 10 years	14,770		15,182
Total	$	48,934	$	48,162

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Mortgage Notes Receivable (Tables)

3 Months Ended

Mar. 31, 2016

Receivables [Abstract]

Schedule of Mortgage Notes Receivable

The following table details the mortgage notes receivable as of March 31, 2016 (dollar amounts in thousands):

Outstanding Balance		Carrying Value		Interest Rate Range				Maturity Date Range
$	25,470	$	23,559	5.9	%	–	7.2%	May 2020	–	January 2033

Schedule of Aggregate Principal Payments Due on Mortgage Notes Receivable

The following table summarizes the scheduled aggregate principal payments due to the Company on the mortgage notes receivable subsequent to March 31, 2016 (in thousands):

	Outstanding Balance
Due within one year	$	1,024
Due after one year through five years	5,344
Due after five years through 10 years	6,725
Due after 10 years(1)	16,298
Total	$	29,391

____________________________________

(1)Includes additional$3.9 million of interest that will be capitalized into the outstanding balance of the mortgage note receivable subsequent toMarch 31, 2016.

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Rent and Tenant Receivables and Other Assets, Net (Tables)

3 Months Ended

Mar. 31, 2016

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Schedule of Rent and Tenant Receivables and Other Assets, Net

Rent and tenant receivables and other assets, net consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016		December 31, 2015
Accounts receivable, net (1)	$	42,574	$	44,798
Straight-line rent receivable	175,686		161,079
Deferred costs relating to revolving credit facility, net (2)	23,499		26,110
Prepaid expenses	13,852		9,773
Leasehold improvements, property and equipment, net (3)	17,889		18,180
Restricted escrow deposits	2,989		1,190
Deferred tax asset and tax receivable	21,335		25,287
Program development costs, net (4)	13,578		12,855
Interest rate swap assets, at fair value	—		1,892
Other assets	2,501		2,473
Total	$	313,903	$	303,637

___________________________________

(1) Allowance for doubtful accounts was $7.9 million and $6.6 million as of March 31, 2016 and December 31, 2015, respectively.

(2) Amortization expense for deferred costs related to the revolving credit facility totaled $2.6 million and $2.7 million for the three months ended March 31, 2016 and 2015, respectively. Accumulated amortization for deferred costs related to the revolving credit facility were $22.0 million and $19.4 million as of March 31, 2016 and December 31, 2015, respectively.

(3) Amortization expense for leasehold improvements totaled $0.3 million and $0.4 million for the three months ended March 31, 2016 and 2015, respectively. Accumulated amortization was $2.9 million and $2.6 million as of March 31, 2016 and December 31, 2015, respectively. Depreciation expense for property and equipment totaled $0.5 million for each of the three months ended March 31, 2016 and 2015, respectively. Accumulated depreciation was $4.2 million and $3.7 million as of March 31, 2016 and December 31, 2015, respectively.

(4) As of March 31, 2016 and December 31, 2015, the Company had reserves of $37.8 million and $34.8 million, respectively, relating to the program development costs.

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Fair Value Measures (Tables)

3 Months Ended

Mar. 31, 2016

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis, based on market rates of the Company’s positions and other observable interest rates as discussed in Note 6 –Investment Securities, at Fair Value andNote 11 –Derivatives and Hedging Activities, as of March 31, 2016 and December 31, 2015, aggregated by the level in the fair value hierarchy within which those instruments fall (in thousands):

	Level 1		Level 2			Level 3		Balance as of March 31, 2016
Assets:
CMBS	$	—	$	—		$	48,162	$	48,162
Liabilities:
Derivative liabilities	$	—	$	(13,800	)	$	—	$	(13,800	)
	Level 1		Level 2			Level 3		Balance as of December 31, 2015
Assets:
CMBS	$	—	$	—		$	53,304	$	53,304
Derivative assets	—		1,892			—		1,892
Total assets	$	—	$	1,892		$	53,304	$	55,196
Liabilities:
Derivative liabilities	$	—	$	(6,922	)	$	—	$	(6,922	)

Reconciliations of Changes in (Liabilities) with Level 3 Inputs

The following are reconciliations of the changes in assets and liabilities with Level 3 inputs in the fair value hierarchy for the three months ended March 31, 2016 and 2015 (in thousands):

	CMBS
Beginning balance, December 31, 2015	$	53,304
Total gains and losses:
Unrealized loss included in other comprehensive income, net	(1,961		)
Purchases, issuances, settlements and amortization:
Principal payments received	(3,217		)
Amortization included in net income	36
Ending Balance, March 31, 2016	$	48,162

	CMBS
Beginning balance, December 31, 2014	$	58,646
Total gains and losses:
Unrealized gain included in other comprehensive income, net	796
Purchases, issuances, settlements and amortization:
Principal payments received	(2,949		)
Ending Balance, March 31, 2015	$	56,493

Reconciliations of Changes in Assets with Level 3 Inputs

The following are reconciliations of the changes in assets and liabilities with Level 3 inputs in the fair value hierarchy for the three months ended March 31, 2016 and 2015 (in thousands):

	CMBS
Beginning balance, December 31, 2015	$	53,304
Total gains and losses:
Unrealized loss included in other comprehensive income, net	(1,961		)
Purchases, issuances, settlements and amortization:
Principal payments received	(3,217		)
Amortization included in net income	36
Ending Balance, March 31, 2016	$	48,162

	CMBS
Beginning balance, December 31, 2014	$	58,646
Total gains and losses:
Unrealized gain included in other comprehensive income, net	796
Purchases, issuances, settlements and amortization:
Principal payments received	(2,949		)
Ending Balance, March 31, 2015	$	56,493

Fair Value, by Balance Sheet Grouping

The fair values of the Company’s financial instruments that are not reported at fair value in the consolidated balance sheets are reported below (dollar amounts in thousands):

	Level	Carrying Amount at March 31, 2016		Fair Value at March 31, 2016		Carrying Amount at December 31, 2015		Fair Value at December 31, 2015
Assets:
Mortgage notes receivable	3	$	23,559	$	32,008	$	24,238	$	31,842
Liabilities (1):
Mortgage notes payable and other debt, net	2	$	3,049,340	$	3,131,489	$	3,133,005	$	3,240,153
Corporate bonds, net	2	2,547,452		2,578,973		2,547,255		2,580,786
Convertible debt, net	2	983,422		1,014,744		982,217		1,007,042
Credit facilities	2	1,280,000		1,282,200		1,460,000		1,536,264
Total liabilities		$	7,860,214	$	8,007,406	$	8,122,477	$	8,364,245

_______________________________________________

(1) Current and prior period liabilities’ carrying and fair values exclude net deferred financing costs

Summary of Impairment Charges by Asset Class

The following table presents the impairment charges by asset class recorded during the three months ended March 31, 2016 (dollar amounts in thousands):

	Three Months Ended March 31,
	2016
Properties impaired	125
Asset classes impaired:
Investment in real estate assets, net	$	160,721
Below-market lease liabilities, net	(204		)
Total impairment loss	$	160,517

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Debt (Tables)

3 Months Ended

Mar. 31, 2016

Debt Instrument [Line Items]

Schedule of Debt

The following table summarizes the carrying value of debt as of March 31, 2016 and December 31, 2015, and the debt activity for the three months ended March 31, 2016 (in thousands):

					Three Months Ended March 31, 2016
		Balance as of December 31, 2015			Debt Issuances		Repayments, Extinguishment and Assumptions			Accretion and (Amortization)			Balance as of March 31, 2016
Mortgage notes payable:
	Outstanding balance	$	3,039,882		$	206	$	(72,785	)	$	—		$	2,967,303
	Net premiums (1)	59,402			—		(1,096		)	(5,777		)	52,529
	Deferred costs	(21,020		)	—		329			1,017			(19,674		)
Other debt:
	Outstanding balance	33,463			—		(4,163		)	—			29,300
	Premium (1)	258			—		—			(50		)	208
Mortgages and other debt, net		3,111,985			206		(77,715		)	(4,810		)	3,029,666
Corporate bonds:
	Outstanding balance	2,550,000			—		—			—			2,550,000
	Discount (2)	(2,745		)	—		—			197			(2,548		)
	Deferred costs	(10,922		)	—		—			1,169			(9,753		)
Corporate bonds, net		2,536,333			—		—			1,366			2,537,699
Convertible debt:
	Outstanding balance	1,000,000			—		—			—			1,000,000
	Discount (2)	(17,779		)	—		—			1,201			(16,578		)
	Deferred costs	(19,327		)	—		—			1,374			(17,953		)
Convertible debt, net		962,894			—		—			2,575			965,469
Credit facility:
	Outstanding balance	1,460,000			203,000		(383,000		)	—			1,280,000
	Deferred costs (3)	(11,410		)	—		—			1,141			(10,269		)
Credit facility, net		1,448,590			203,000		(383,000		)	1,141			1,269,731
Total debt		$	8,059,802		$	203,206	$	(460,715	)	$	272		$	7,802,565

____________________________________

(1) Net premiums on mortgage notes payable and other debt were recorded upon the assumption of the respective debt instruments in relation to the various mergers and acquisitions. Amortization of these net premiums is recorded as a reduction to interest expense over the remaining term of the respective debt instruments using the effective-interest method.

(2) Discounts on the corporate bonds and convertible debt were recorded based upon the fair value of the respective debt instruments as of the respective issuance dates. Amortization of these discounts is recorded as an increase to interest expense over the remaining term of the respective debt instruments using the effective-interest method.

(3) Deferred costs relate to the term portion of the credit facility

Mortgage Notes Payable [Member]

Debt Instrument [Line Items]

Schedule of Debt

The Company’s mortgage notes payable consisted of the following as of March 31, 2016 (dollar amounts in thousands):

	Encumbered Properties	Gross Carrying Value of Collateralized Properties (1)		Outstanding Balance		Weighted-Average Interest Rate (2)		Weighted-Average Years to Maturity
Fixed-rate debt (3)	651	$	5,533,845	$	2,958,859	5.10	%	4.9
Variable-rate debt	1	24,797		8,444		3.39	%	0.4
Total (4)	652	$	5,558,642	$	2,967,303	5.09	%	4.9

____________________________________

(1) Gross carrying value is gross real estate assets, including investment in direct financing leases, net of gross real estate liabilities.

(2) Weighted-average interest rate for variable-rate debt represents the interest rate in effect as of March 31, 2016.

(3) Includes $247.9 million of variable-rate debt fixed by way of interest rate swap arrangements. 

(4) The table above does not include loan amounts associated with the Unconsolidated Joint Ventures of $46.3 million, none of which is recourse to the Company. These loans represent secured fixed and variable rates ranging from 2.84% to 5.20% and maturities ranging from October 2016 to July 2021, with a weighted-average interest rate of 3.88% and a weighted-average years to maturity of 2.6 years as of March 31, 2016.

Schedule of Aggregate Principal Payments of Mortgages

The following table summarizes the scheduled aggregate principal repayments due on mortgage notes subsequent to March 31, 2016 (in thousands):

	Total
April 1, 2016 - December 31, 2016 (1)	$	198,991
2017	412,546
2018	211,026
2019	231,461
2020	284,197
Thereafter	1,629,082
Total	$	2,967,303

____________________________________

(1) Includes $38.1 million of mortgage notes in connection with the default of a non-recourse loan discussed above.

Other Debt [Member]

Debt Instrument [Line Items]

Schedule of Debt

The following table is a summary of the outstanding balance and carrying value of the collateral by asset type as of March 31, 2016 (in thousands):

	Outstanding Balance		Collateral Carrying Value
Mortgage notes receivable	$	8,095	$	19,950
Intercompany mortgage loans	2,264		5,462
CMBS	18,941		35,921
	$	29,300	$	61,333

Corporate Bonds [Member]

Debt Instrument [Line Items]

Schedule of Debt

The following table presents the three senior notes with their respective terms (dollar amounts in thousands):

	Outstanding Balance		Interest Rate		Maturity Date
2017 Senior Notes	$	1,300,000	2.0	%	February 6, 2017
2019 Senior Notes	750,000		3.0	%	February 6, 2019
2024 Senior Notes	500,000		4.6	%	February 6, 2024
Total balance and weighted-average interest rate	$	2,550,000	2.8	%

Convertible Debt [Member]

Debt Instrument [Line Items]

Schedule of Debt

The following table presents each of the 2018 Convertible Notes and the 2020 Convertible Notes listed below with their respective terms (dollar amounts in thousands):

	Outstanding Balance (1)		Interest Rate		Conversion Rate (2)	Maturity Date
2018 Convertible Notes	$	597,500	3.00	%	60.5997	August 1, 2018
2020 Convertible Notes	402,500		3.75	%	66.7249	December 15, 2020
Total balance and weighted-average interest rate	$	1,000,000	3.30	%

____________________________________

(1) Excludes the carrying value of the conversion options recorded within additional paid-in capital of $28.6 million and the unamortized discount of $16.6 million as of March 31, 2016. The discount will be amortized over the remaining term of 3.3 years.

(2) Conversion rate represents the amount of the General Partner OP Units per $1,000 principal amount of Convertible Notes converted as of March 31, 2016, as adjusted in accordance with the applicable indentures as a result of cash dividend payments.

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Derivatives and Hedging Activities (Tables)

3 Months Ended

Mar. 31, 2016

Designated as Hedging Instrument [Member]

Derivative Instruments and Hedging Activities Disclosures [Line Items]

Schedule of Interest Rate Derivatives

As of March 31, 2016, the Company had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk (dollar amounts in thousands):

Interest Rate Swaps	March 31, 2016
Number of Instruments	16
Notional Amount	$	1,211,457

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in the consolidated balance sheets as of March 31, 2016 and December 31, 2015 (in thousands):

Derivatives Designated as Hedging Instruments	Balance Sheet Location	March 31, 2016			December 31, 2015
Interest rate swaps	Rent and tenant receivables and other assets, net	$	—		$	1,794
Interest rate swaps	Deferred rent, derivative and other liabilities	$	(12,989	)	$	(6,922	)

Not Designated as Hedging Instrument [Member]

Derivative Instruments and Hedging Activities Disclosures [Line Items]

Schedule of Interest Rate Derivatives

As of March 31, 2016, the Company had the following outstanding interest rate derivative that was not designated as a qualifying hedging relationship (dollar amounts in thousands):

Interest Rate Swap	March 31, 2016
Number of Instruments	1
Notional Amount	$	51,400

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The table below presents the fair value of the Company’s derivative financial instrument not designated as a hedge as well as its classification in the consolidated balance sheets as of March 31, 2016 and December 31, 2015 (in thousands):

Derivatives Not Designated as Hedging Instruments	Balance Sheet Location	March 31, 2016			December 31, 2015
Interest rate swaps	Rent and tenant receivables and other assets, net	$	—		$	98
Interest rate swaps	Deferred rent, derivative and other liabilities	$	(811	)	$	—

Schedule of Offsetting Assets

The tabular disclosure of fair value provides the location that derivative assets and liabilities are presented in the accompanying consolidated balance sheets.

	Offsetting of Derivative Assets and Liabilities
	Gross Amounts of Recognized Assets		Gross Amounts of Recognized Liabilities			Gross Amounts Offset in the Consolidated Balance Sheets		Net Amounts of Assets Presented in the Consolidated Balance Sheets		Net Amounts of Liabilities Presented in the Consolidated Balance Sheets			Financial Instruments		Cash Collateral Received		Net Amount
March 31, 2016	$	—	$	(13,800	)	$	—	$	—	$	(13,800	)	$	—	$	—	$	(13,800	)
December 31, 2015	$	1,892	$	(6,922	)	$	—	$	1,892	$	(6,922	)	$	—	$	—	$	(5,030	)

Schedule of Offsetting Liabilities

The tabular disclosure of fair value provides the location that derivative assets and liabilities are presented in the accompanying consolidated balance sheets.

	Offsetting of Derivative Assets and Liabilities
	Gross Amounts of Recognized Assets		Gross Amounts of Recognized Liabilities			Gross Amounts Offset in the Consolidated Balance Sheets		Net Amounts of Assets Presented in the Consolidated Balance Sheets		Net Amounts of Liabilities Presented in the Consolidated Balance Sheets			Financial Instruments		Cash Collateral Received		Net Amount
March 31, 2016	$	—	$	(13,800	)	$	—	$	—	$	(13,800	)	$	—	$	—	$	(13,800	)
December 31, 2015	$	1,892	$	(6,922	)	$	—	$	1,892	$	(6,922	)	$	—	$	—	$	(5,030	)

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Supplemental Cash Flow Disclosures (Tables)

3 Months Ended

Mar. 31, 2016

Supplemental Cash Flow Elements [Abstract]

Supplemental Cash Flow Disclosures

Supplemental cash flow information was as follows for the three months ended March 31, 2016 and 2015 (in thousands):

	Three Months Ended March 31,
	2016		2015
Supplemental Disclosures:
Cash paid for interest	$	93,713	$	109,025
Cash paid for income taxes	$	10,848	$	51
Non-cash investing and financing activities:
Accrued capital expenditures and real estate developments	$	1,327	$	4,126
Accrued repurchases of common stock to settle tax obligation	$	223	$	—
Accrued distributions	$	3,157	$	—
Mortgage note payable relieved by foreclosure	$	—	$	53,798
Mortgage notes payable assumed in real estate disposition	$	55,000	$	24,000

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Accounts Payable and Accrued Expenses (Tables)

3 Months Ended

Mar. 31, 2016

Payables and Accruals [Abstract]

Schedule of Accrued Liabilities

Accounts payable and accrued expenses consisted of the following as of March 31, 2016 and December 31, 2015 (in thousands):

	March 31, 2016		December 31, 2015
Accrued interest	$	40,215	$	56,273
Accrued real estate taxes	35,134		47,319
Accrued legal fees	13,922		9,212
Accounts payable	2,547		2,868
Accrued other	27,152		36,205
Total	$	118,970	$	151,877

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Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2016

Commitments and Contingencies Disclosure [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases

These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items (in thousands):

	Future Minimum Operating Lease Base Rent Payments		Future Minimum Direct Financing Lease Payments (1)
April 1, 2016 - December 31, 2016	$	882,655	$	3,338
2017	1,162,408		4,036
2018	1,131,580		3,016
2019	1,090,919		2,397
2020	1,050,467		2,023
Thereafter	7,870,665		5,893
Total	$	13,188,694	$	20,703

____________________________________

(1) 36 properties are subject to direct financing leases and, therefore, revenue is recognized as direct financing lease income on the discounted cash flows of the lease payments. Amounts reflected are the minimum base rental cash payments due to the Company under the lease agreements on these respective properties.

The following table reflects the minimum base rent payments due from the Company over the next five years and thereafter for certain ground lease obligations, which are substantially reimbursable by our tenants, and office lease obligations (in thousands):

	Future Minimum Base Rent Payments
	Ground Leases		Office Leases
April 1, 2016 - December 31, 2016	$	10,659	$	3,793
2017	14,820		4,585
2018	14,410		4,704
2019	14,146		4,769
2020	13,386		4,797
Thereafter	224,648		14,089
Total	$	292,069	$	36,737

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Equity-based Compensation (Tables)

3 Months Ended

Mar. 31, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Activity for Share-based Compensation

The following table details the activity of the Time-Based Restricted Stock Units and Deferred Stock Units during the three months ended March 31, 2016.

	Time-Based Restricted Stock Units		Weighted-Average Grant Date Fair Value		Deferred Stock Units	Weighted-Average Grant Date Fair Value
Unvested units, December 31, 2015	589,138		$	9.61	—	$	—
Granted	725,921		7.81		—	—
Vested	(7,965	)	9.76		—	—
Unvested units, March 31, 2016	1,307,094		$	8.61	—	$	—

The following table details the activity of the Restricted Shares during the three months ended March 31, 2016:

	Restricted Shares		Weighted-Average Grant Date Fair Value
Unvested shares, December 31, 2015	1,239,662		$	13.86
Vested	(363,973	)	14.12
Forfeited	(7,253	)	14.02
Unvested shares, March 31, 2016	868,436		$	13.75

The following table details the activity of the unvested Market-Based Restricted Stock Units and the LTI Target Awards during the three months ended March 31, 2016.

	Market-Based Restricted Stock Units		Weighted-Average Grant Date Fair Value		LTI Target Awards	Weighted-Average Grant Date Fair Value
Unvested units, December 31, 2015	704,804		$	8.58	731,448	$	11.38
Granted	—		—		850,942	7.13
Forfeited	(25,677	)	8.58		—	—
Unvested units, March 31, 2016	679,127		$	8.58	1,582,390	$	9.09

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Related Party Transactions and Arrangements (Tables)

3 Months Ended

Mar. 31, 2016

Offering Related Revenue [Member]

Related Party Transaction [Line Items]

Schedule of Related Party Transactions

The following table shows the offering fee summary information for the Cole REITs as of March 31, 2016:

Program	Selling Commissions (1)	Dealer Manager and Distribution Fees (2)
Open Programs
CCPT V	7%	2%
INAV (3)
Wrap Class Shares	—%	0.55%
Advisor Class Shares	up to 3.75%	0.55% and 0.50%
Institutional Class Shares	—%	0.25%
CCIT II	7%	2%

_______________________________________________

(1) The Company reallows 100% of selling commissions earned to participating broker-dealers.

(2) The Company may reallow all or a portion of its dealer manager fee or applicable distribution fee to participating broker-dealers as a marketing and due diligence expense reimbursement.

(3) In connection with the INAV offering, the Company receives selling commissions, an asset-based dealer manager fee and/or an asset-based distribution fee, all based on the net asset value for each class of common stock.

Transaction Related Fees [Member]

Related Party Transaction [Line Items]

Schedule of Related Party Transactions

The following table shows the transaction-related fees for the Cole REITs and other real estate programs as of March 31, 2016:

Program	Acquisition Fees (1)	Disposition Fees	Performance Fees (2)
Open Programs
CCPT V	2%	1%	15%
INAV	—	—	—
CCIT II	2%	1%	15%
Closed Programs
CCPT IV	2%	1%	15%
Other Programs	Various	Various	Various

_______________________________________________

(1) Percent taken on gross purchase price.

(2) Performance fee paid only under the following circumstances: (i) if shares are listed on a national securities exchange; (ii) if the respective Cole REIT is sold or the assets are liquidated; or (iii) upon termination of the advisory agreement. In connection with such events, the performance fee will only be earned upon the return to investors of their net capital invested and an 8% annual cumulative, non-compounded return (6% in the case of CCPT V).

Management Service Revenue [Member]

Related Party Transaction [Line Items]

Schedule of Related Party Transactions

The following table shows the management fees for the Cole REITs as of March 31, 2016:

Program	Asset Management / Advisory Fees (1)	Performance Fees (2)
Open Programs
CCPT V	0.65% - 0.75%	—
INAV	0.90%	25%
CCIT II	0.65% - 0.75%	—
Closed Programs
CCPT IV	0.65% - 0.75%	—
Other Programs	Various	—

_______________________________________________

(1) Annualized fee based on the average monthly invested assets or net asset value, if available.

(2) Performance fee paid on the amount in which the total return on stockholders’ capital exceeds 6% per annum on a calendar year basis.

Revenue from Managed REITs [Member]

Related Party Transaction [Line Items]

Schedule of Related Party Transactions

The table below reflects the revenue earned from the Cole REITs (including closed programs, as applicable) and joint ventures for the three months ended March 31, 2016 and 2015 (in thousands).

	Three Months Ended March 31,
	2016		2015
Offering-related fees and reimbursements
Securities commissions (1)	$	7,041	$	1,775
Dealer manager and distribution fees (2)	2,640		716
Reimbursement revenue	2,710		626
Offering-related fees and reimbursements	12,391		3,117
Transaction service fees and reimbursements
Acquisition fees	1,702		4,488
Disposition fees (3)	—		4,350
Reimbursement revenues	682		571
Transaction service fees and reimbursements	2,384		9,409
Management fees and reimbursements
Asset and property management fees and leasing fees	55		103
Advisory and performance fee revenue	12,050		11,173
Reimbursement revenues	4,123		2,518
Management fees and reimbursements	16,228		13,794
Interest income on Affiliate Lines of Credit	308		408
Total related party revenues(4)	$	31,311	$	26,728

___________________________________

(1) The Company reallows 100% of selling commissions earned to participating broker-dealers.

(2) During the three months ended March 31, 2016 and 2015, the Company reallowed $1.0 million and $0.3 million, respectively, of dealer manager fees to participating broker dealers as a marketing and due diligence expense reimbursement.

(3) The Company earned a disposition fee of $4.4 million on behalf of CCIT when it merged with Select Income REIT on January 29, 2015.

(4) Total related party revenues excludes fees earned from 1031 real estate programs of $0.2 million and $1.2 million for the three months ended March 31, 2016 and 2015, respectively.

Investments In Managed REITs [Member]

Related Party Transaction [Line Items]

Schedule of Related Party Transactions

The table below presents certain information related to the Company’s investments in the Cole REITs as of March 31, 2016 (carrying amount in thousands):

	March 31, 2016
Cole REIT	% of Outstanding Shares Owned	Carrying Amount of Investment
CCPT V	1.14%	$	1,553
INAV	0.12%	149
CCIT II	0.58%	1,388
CCPT IV	0.01%	119
Funds not yet in offering	N/A	600
		$	3,809

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Net Loss Per Share/Unit (Tables)

3 Months Ended

Mar. 31, 2016

Earnings Per Share [Abstract]

Summary of Basic and Diluted Net Loss Per Share

The following is a summary of the basic and diluted net loss per share computation for the General Partner for the three months ended March 31, 2016 and 2015 (dollar amounts in thousands, except for share and per share data):

	Three Months Ended March 31,
	2016			2015
Net loss attributable to the General Partner	$	(113,086	)	$	(29,970	)
Less: dividends to preferred shares and participating securities	18,098			17,978
Net loss attributable to common stockholders	$	(131,184	)	$	(47,948	)
Weighted average number of common stock outstanding - basic and diluted	903,825,726			902,996,270
Basic and diluted net loss per share attributable to common stockholders	$	(0.15	)	$	(0.05	)

The following is a summary of the basic and diluted net loss per unit computation for the OP for the three months ended March 31, 2016 and 2015 (dollar amounts in thousands, except for unit and per unit data):

	Three Months Ended March 31,
	2016			2015
Net loss attributable to the Operating Partnership	$	(116,041	)	$	(30,873	)
Less: dividends to preferred units and participating securities	18,098			17,978
Net loss attributable to common unitholders	$	(134,139	)	$	(48,851	)
Weighted average number of common units outstanding - basic and diluted	927,589,523			926,760,067
Basic and diluted net loss per unit attributable to common unitholders	$	(0.15	)	$	(0.05	)

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Subsequent Events Subsequent Events (Tables)

3 Months Ended

Mar. 31, 2016

Subsequent Events [Abstract]

Schedule of Record and Payment Dates for Preferred Stock Dividends

The dividend for the Series F Preferred Stock accrues daily on a 360-day annual basis equal to an annualized dividend rate of $1.675 per share, or $0.1395833 per 30-day month.

Period	Record Date	Payment Date
June 15, 2016 - July 14, 2016	July 1, 2016	July 15, 2016
July 15, 2016 - August 14, 2016	August 1, 2016	August 15, 2016
August 15, 2016 - September 14, 2016	September 1, 2016	September 15, 2016

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Organization (Details)		3 Months Ended
	Jul. 28, 2015 $ / shares	Mar. 31, 2016 segment $ / shares	Dec. 31, 2015 $ / shares
Real Estate Properties [Line Items]
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Series F Cumulative Redeemable Preferred Stock, par value (in dollars per share)		$ 0.01	$ 0.01
Number of reportable segments | segment		2
VEREIT Operating Partnership, L.P. [Member]
Real Estate Properties [Line Items]
Partnership units, holding period until right to redeem		1 year
General Partner [Member]
Real Estate Properties [Line Items]
General partner ownership interest in OP		97.40%
Limited Partner [Member] | VEREIT Operating Partnership, L.P. [Member]
Real Estate Properties [Line Items]
Common equity interests owned by certain unaffiliated investors		2.60%
Series F Preferred Stock [Member]
Real Estate Properties [Line Items]
Series F Cumulative Redeemable Preferred Stock, dividend rate	6.70%	6.70%
Series F Cumulative Redeemable Preferred Stock, par value (in dollars per share)	$ 0.01

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Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015	Mar. 31, 2015
Related Party Transaction [Line Items]
Restricted cash	$ 60,132	$ 59,767
Allowance for doubtful accounts	7,900	6,600
Deferred Rent, Derivative and Other Liabilities [Member]
Related Party Transaction [Line Items]
Deferred rental income	67,300	67,200
Lender Reserves [Member]
Related Party Transaction [Line Items]
Restricted cash	48,800	47,900
Restricted Lockbox Accounts [Member]
Related Party Transaction [Line Items]
Restricted cash	11,300	11,900
VEREIT Operating Partnership, L.P. [Member]
Related Party Transaction [Line Items]
Restricted cash	$ 60,132	$ 59,767
VEREIT Operating Partnership, L.P. [Member] | Common Stock [Member]
Related Party Transaction [Line Items]
Limited partners', units outstanding (shares)	23,763,797	23,763,797
VEREIT Operating Partnership, L.P. [Member] | Common Stock [Member] | Limited Partner [Member]
Related Party Transaction [Line Items]
Limited partners', units outstanding (shares)	23,763,797	23,763,797	23,763,797

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Summary of Significant Accounting Policies - Acquisition Related Expenses and Other One-Time Transaction Related Expenses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Other non-routine transaction related expenses:
Audit Committee Investigation and related matters	$ 4,742	$ 15,316
Legal fees and expenses	83	475
Other fees and expenses	0	632
Total costs incurred	4,825	16,423
Insurance recoveries	(10,000)	0
Total	$ (5,175)	$ 16,423

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Segment Reporting (Narrative) (Details) ft² in Millions	3 Months Ended
	Mar. 31, 2016 ft² security state segment loan property	Dec. 31, 2015 security
Segment Reporting Information [Line Items]
Number of operating segments | segment	2
Number of loans held for investment | loan	9
Commercial Mortgage Backed Securities [Member]
Segment Reporting Information [Line Items]
Number of securities acquired | security	9	10
REI Segment [Member] | Consolidated Properties [Member]
Segment Reporting Information [Line Items]
Number of properties owned | property	4,378
Square feet of property | ft²	99.0
Number of states in which entity operates | state	49
Percentage of rentable space leased	98.60%
Real estate property, weighted average remaining lease term	10 years 4 months 24 days

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Segment Reporting (Details) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Segment Reporting Information [Line Items]
Rental income	$ 313,971,000	$ 342,759,000
Direct financing lease income	569,000	741,000
Operating expense reimbursements	23,247,000	22,974,000
Total revenues	369,020,000	393,968,000
Acquisition related	242,000	2,182,000
Litigation and other non-routine costs, net of insurance recoveries	(5,175,000)	16,423,000
Property operating	34,813,000	30,999,000
General and administrative	29,400,000	33,106,000
Depreciation and amortization	204,308,000	219,141,000
Impairment of real estate	160,517,000	0
Total operating expenses	432,173,000	303,882,000
Operating (loss) income	(63,153,000)	90,086,000
Gain on extinguishment and forgiveness of debt, net	0	5,302,000
Other income, net	1,062,000	4,060,000
Loss on derivative instruments, net	(1,086,000)	(1,028,000)
Total other expenses, net	(70,046,000)	(87,337,000)
(Loss) income before taxes and real estate dispositions	(133,199,000)	2,749,000
Gain (loss) on disposition of real estate, net	17,175,000	(31,368,000)
Loss before taxes	(116,024,000)	(28,619,000)
Benefit from (provision for) income taxes	(56,000)	(2,074,000)
Net loss	(116,080,000)	(30,693,000)
Cole Capital reallowed fees and commissions	8,068,000	2,031,000
Total Assets	16,843,612,000		$ 17,405,866,000
REI segment [Member]
Segment Reporting Information [Line Items]
Benefit from (provision for) income taxes	(1,400,000)	(1,900,000)
Cole Capital segment [Member]
Segment Reporting Information [Line Items]
Benefit from (provision for) income taxes	1,300,000	(200,000)
Operating Segments [Member] | REI segment [Member]
Segment Reporting Information [Line Items]
Rental income	313,971,000	342,759,000
Direct financing lease income	569,000	741,000
Operating expense reimbursements	23,247,000	22,974,000
Total revenues	337,787,000	366,474,000
Acquisition related	217,000	1,723,000
Litigation and other non-routine costs, net of insurance recoveries	(5,175,000)	16,423,000
Property operating	34,813,000	30,999,000
General and administrative	12,228,000	15,370,000
Depreciation and amortization	195,991,000	210,788,000
Impairment of real estate	160,517,000	0
Total operating expenses	398,591,000	275,303,000
Operating (loss) income	(60,804,000)	91,171,000
Interest expense	(80,426,000)	(95,699,000)
Gain on extinguishment and forgiveness of debt, net	0	5,302,000
Other income, net	568,000	2,841,000
Equity in income and gain on disposition of unconsolidated entities	10,404,000	28,000
Loss on derivative instruments, net	(1,086,000)	(1,028,000)
Total other expenses, net	(70,540,000)	(88,556,000)
(Loss) income before taxes and real estate dispositions	(131,344,000)	2,615,000
Gain (loss) on disposition of real estate, net	17,175,000	(31,368,000)
Loss before taxes	(114,169,000)	(28,753,000)
Benefit from (provision for) income taxes	(1,365,000)	(1,854,000)
Net loss	(115,534,000)	(30,607,000)
Total Assets	16,465,057,000		16,966,729,000
Operating Segments [Member] | Cole Capital segment [Member]
Segment Reporting Information [Line Items]
Total revenues	31,233,000	27,494,000
Acquisition related	25,000	459,000
General and administrative	17,172,000	17,736,000
Depreciation and amortization	8,317,000	8,353,000
Total operating expenses	33,582,000	28,579,000
Operating (loss) income	(2,349,000)	(1,085,000)
Total other expenses, net	494,000	1,219,000
Loss before taxes	(1,855,000)	134,000
Benefit from (provision for) income taxes	1,309,000	(220,000)
Net loss	(546,000)	(86,000)
Offering-related fees and reimbursements	12,391,000	3,117,000
Transaction service fees and reimbursements	2,384,000	10,260,000
Management fees and reimbursements	16,458,000	14,117,000
Cole Capital reallowed fees and commissions	8,068,000	$ 2,031,000
Total Assets	$ 378,555,000		$ 439,137,000

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Goodwill and Other Intangibles (Narrative) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($) segment	Mar. 31, 2015 USD ($)	Dec. 31, 2015 USD ($)
Related Party Transaction [Line Items]
Number of segments | segment	2
Amortization expense	$ 7,500	$ 7,500
Intangible assets	$ 43,327		$ 50,779
Cole REITs [Member] | Management And Advisory Contracts [Member]
Related Party Transaction [Line Items]
Estimated useful life	4 years
Estimated amortization expense for remainder of 2016	$ 18,700
Estimated amortization expense for 2017	16,600
Estimated amortization expense for 2018	4,000
Estimated amortization expense for 2019	3,800
Intangible assets	43,300		50,800
Intangible assets, accumulated amortization	$ 10,900		$ 3,400
REI Segment [Member]
Related Party Transaction [Line Items]
Number of segments | segment	1
Cole Capital Segment [Member]
Related Party Transaction [Line Items]
Number of segments | segment	1

XML

Goodwill and Other Intangibles (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Goodwill [Roll Forward]
Goodwill, beginning balance	$ 1,656,374	$ 1,894,794
Goodwill allocated to dispositions and held for sale assets	(13,516)	(23,680)
Goodwill, ending balance	1,642,858	1,871,114
REI segment [Member]
Goodwill [Roll Forward]
Goodwill, beginning balance	1,410,631	1,509,396
Goodwill allocated to dispositions and held for sale assets	(13,516)	(23,680)
Goodwill, ending balance	1,397,115	1,485,716
Cole Capital Segment [Member]
Goodwill [Roll Forward]
Goodwill, beginning balance	245,743	385,398
Goodwill allocated to dispositions and held for sale assets	0	0
Goodwill, ending balance	$ 245,743	$ 385,398

XML

Goodwill and Other Intangibles (Intangible Lease Assets and Liabilities) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Finite-Lived Intangible Assets [Line Items]
Intangible lease liabilities, accumulated amortization	$ 42,629	$ 38,340
Below-market lease, Weighted-Average Useful Life	17 years 4 months 24 days
Intangible lease liabilities, net	$ 245,093	251,692
Total Intangible Lease Assets [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible lease assets, net	1,686,900	1,771,532
In-Place Leases [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible lease assets, accumulated amortization	$ 405,753	398,770
Intangible lease assets, Weighted-Average Useful Life	13 years 6 months
Intangible lease assets, net	$ 1,381,547	1,458,354
Leasing Commissions [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible lease assets, accumulated amortization	$ 1,137	1,035
Intangible lease assets, Weighted-Average Useful Life	9 years 2 months 12 days
Intangible lease assets, net	$ 6,060	4,872
Above-Market Leases [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible lease assets, accumulated amortization	$ 51,944	47,041
Intangible lease assets, Weighted-Average Useful Life	16 years 1 month 6 days
Intangible lease assets, net	$ 299,293	$ 308,306

XML

Goodwill and Other Intangibles (Projected Amortization Expense and Adjustments) (Details) $ in Thousands	Mar. 31, 2016 USD ($)
Acquired Finite-Lived Intangible Assets [Line Items]
Below-market lease liabilities, amortization income, April 1, 2016 - December 31, 2016	$ 23,115
Below-market lease liabilities, amortization income, 2017	20,453
Below-market lease liabilities, amortization income, 2018	20,126
Below-market lease liabilities, amortization income, 2019	19,388
Below-market lease liabilities, amortization income, 2020	18,196
In-Place Leases [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization expense, April 1, 2016 - December 31, 2016	168,216
Amortization expense, 2017	154,275
Amortization expense, 2018	141,317
Amortization expense, 2019	129,711
Amortization expense, 2020	120,676
Leasing Commissions [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization expense, April 1, 2016 - December 31, 2016	1,341
Amortization expense, 2017	682
Amortization expense, 2018	496
Amortization expense, 2019	425
Amortization expense, 2020	407
Above-Market Lease Assets [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization expense, April 1, 2016 - December 31, 2016	25,672
Amortization expense, 2017	25,309
Amortization expense, 2018	24,756
Amortization expense, 2019	22,801
Amortization expense, 2020	$ 22,334

XML

Real Estate Investments (Narrative) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($) property	Mar. 31, 2015 USD ($) property land_parcel
2016 Acquisitions [Member]
Business Acquisition [Line Items]
Number of properties acquired | property	1
Total purchase price of assets acquired | $	$ 19,952
2015 Acquisitions [Member]
Business Acquisition [Line Items]
Number of properties acquired | property		10
Development projects in progress | land_parcel		6
Total purchase price of assets acquired | $		$ 7,627

XML

Real Estate Investments (Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
2016 Acquisitions [Member]
Assets Acquired and Liabilities Assumed
Land	$ 4,215
Buildings, fixtures and improvements	14,555
Total tangible assets	18,770
In-place leases	1,182
Total purchase price of assets acquired	$ 19,952
2015 Acquisitions [Member]
Assets Acquired and Liabilities Assumed
Land		$ 1,594
Buildings, fixtures and improvements		5,617
Total tangible assets		7,211
In-place leases		416
Total purchase price of assets acquired		$ 7,627

XML

Real Estate Investments (Future Lease Payments) (Details) $ in Thousands	Mar. 31, 2016 USD ($) property
Operating Leases, Future Minimum Payments Receivable [Abstract]
April 1, 2016 - December 31, 2016	$ 882,655
2017	1,162,408
2018	1,131,580
2019	1,090,919
2020	1,050,467
Thereafter	7,870,665
Total	13,188,694
Future Minimum Direct Financing Lease Payments
April 1, 2016 - December 31, 2016	3,338
2017	4,036
2018	3,016
2019	2,397
2020	2,023
Thereafter	5,893
Total	$ 20,703
Number of properties subject to direct financing leases | property	36

XML

Real Estate Investments (Investment in Direct Financing Leases, Net) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Real Estate [Abstract]
Future minimum lease payments receivable	$ 20,703	$ 21,993
Unguaranteed residual value of property	31,562	31,562
Unearned income	(6,654)	(7,243)
Net investment in direct financing leases	$ 45,611	$ 46,312

XML

Real Estate Investments (Development Activities) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($) development_project	Mar. 31, 2015 USD ($)	Dec. 31, 2015 USD ($)
Business Acquisition [Line Items]
Land and construction in progress	$ 15,900		$ 20,000
Number of development projects completed | development_project	35
Aggregate cost to date	$ 50,600
Number of remaining projects to be completed | development_project	2
Estimated completion period for remaining projects	3 months
Number of development projects placed into service | development_project	1
Aggregate cost of projects placed in service	$ 1,400
Interest Costs Capitalized	$ 100	$ 300
Number of other build-to-suit, redevelopment and expansion projects | development_project	4
Total commitment	$ 1,400
Land and Construction in Progress [Member]
Business Acquisition [Line Items]
Tenant Improvements	$ 3,200
2016 Acquisitions [Member]
Business Acquisition [Line Items]
Development projects in progress | development_project	6
Investment to date	$ 12,729
Estimated cost to complete	4,563
Total Investment	$ 17,292

XML

Real Estate Investments (Property Dispositions and Held for Sale Assets) (Narrative) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($) property	Mar. 31, 2015 USD ($) property	Dec. 31, 2015 USD ($) property
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Proceeds after debt assumptions and closing costs	$ 176,137	$ 245,548
Gain related to sale, including goodwill	17,175	(31,368)
Foreclosed upon property net book value	14,500,266		$ 15,006,124
Gain related to sale of unconsolidated entities	10,404	28
Goodwill allocated to dispositions	$ 13,516	$ 23,680
2016 Property Dispositions [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of real estate properties disposed | property	58
Aggregate proceeds	$ 193,700
Company's share of proceeds	102,100
Proceeds after debt assumptions and closing costs	133,800
Debt assumption	55,000
Gain related to sale, including goodwill	18,800
Goodwill included in sale	$ 11,300
Number of properties owned by consolidated joint ventures disposed of | property	1
Net proceeds	$ 113,500
Proceeds from Real Estate and Real Estate Joint Ventures	42,300
Debt repayments	57,000
Gain related to sale of unconsolidated entities	$ 10,200
Number of properties classified held for sale | property	19
Net loss on sale of properties	$ 1,700
Goodwill allocated to dispositions	2,200
Red Lobster [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Company's share of proceeds	$ 193,100
2015 Property Dispositions [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of real estate properties disposed | property		11
Aggregate proceeds		$ 271,800
Proceeds after debt assumptions and closing costs		245,500
Gain related to sale, including goodwill		31,400
Goodwill included in sale		$ 23,700
Number of properties classified held for sale | property			17
Foreclosed Upon Real Estate Property [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of real estate properties foreclosed upon | property		1
Foreclosed upon property net book value		$ 38,200

XML

Real Estate Investments (Impairment of Real Estate Investments) (Narrative) (Details)	3 Months Ended
	Mar. 31, 2016 USD ($) restaurant	Mar. 31, 2015 USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Number of restaurants owned by tenant | restaurant	59
Impairment charges	$ 160,517,000	$ 0
Reported Value Measurement [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying value of real estate assets deemed to be impaired	623,000,000
Estimated fair value of real estate assets deemed to be impaired	$ 462,500,000
Minimum [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Period for determining disposal is more likely than not	12 months
Maximum [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Period for determining disposal is more likely than not	24 months

XML

Real Estate Investments (Consolidated Joint Ventures) (Narrative) (Details) $ in Thousands		3 Months Ended		12 Months Ended
		Mar. 31, 2016 USD ($) property joint_venture	Mar. 31, 2015 USD ($)	Dec. 31, 2015 USD ($) property joint_venture
Schedule of Equity Method Investments [Line Items]
Total assets		$ 16,843,612		$ 17,405,866
Real estate investments, net		14,500,266		15,006,124
Net income (loss) attributable to non-controlling interests	[1]	(2,994)	$ (723)
VEREIT Operating Partnership, L.P. [Member]
Schedule of Equity Method Investments [Line Items]
Total assets		16,843,612		17,405,866
Real estate investments, net		14,500,266		$ 15,006,124
Net income (loss) attributable to non-controlling interests	[2]	$ (39)	$ 180
Mortgages [Member]
Schedule of Equity Method Investments [Line Items]
Number of properties owned | property		652
Joint ventures [Member]
Schedule of Equity Method Investments [Line Items]
Number of joint ventures | joint_venture		2		2
Total assets		$ 58,000		$ 58,500
Real estate investments, net		$ 54,900		$ 55,200
Number of properties with secured mortgage note payable | property		1
Joint ventures [Member] | Mortgages [Member]
Schedule of Equity Method Investments [Line Items]
Mortgage note payable		$ 8,400
Joint ventures [Member] | Consolidated Properties [Member]
Schedule of Equity Method Investments [Line Items]
Number of properties owned | property		2		2

[1] Represents loss attributable to limited partners and consolidated joint venture partners.

[2] Represents loss (income) attributable to consolidated joint venture partners.

XML

Real Estate Investments (Unconsolidated Joint Ventures) (Narrative) (Details) ft² in Millions	3 Months Ended
	Mar. 31, 2016 USD ($) ft² property joint_venture	Mar. 31, 2015 USD ($)	Dec. 31, 2015 USD ($) ft² property joint_venture
Schedule of Equity Method Investments [Line Items]
Aggregate equity investments	$ 23,445,000		$ 56,824,000
Carrying value of investment	19,637,000
Net income	$ 206,000	$ 28,000
Mortgages [Member]
Schedule of Equity Method Investments [Line Items]
Number of properties owned | property	652
Debt outstanding	$ 2,967,303,000		3,039,882,000
Unconsolidated Joint Venture [Member]
Schedule of Equity Method Investments [Line Items]
Aggregate equity investments	19,600,000		$ 52,800,000
Net income	300,000	$ 100,000
Unconsolidated Joint Venture [Member] | Mortgages [Member]
Schedule of Equity Method Investments [Line Items]
Debt outstanding	46,300,000
Unconsolidated Joint Venture [Member] | Mortgages [Member] | Recourse debt [Member]
Schedule of Equity Method Investments [Line Items]
Debt outstanding	$ 0
Unconsolidated Properties [Member] | REI segment [Member]
Schedule of Equity Method Investments [Line Items]
Number of unconsolidated joint ventures | joint_venture	2		3
Number of properties owned | property	2		3
Net rentable area (in square feet) | ft²	0.5		0.9

XML

Real Estate Investments (Ownership and Carrying Amounts for Unconsolidated Ventures) (Details) $ in Thousands	Mar. 31, 2016 USD ($)
Schedule of Equity Method Investments [Line Items]
Carrying value of investment	$ 19,637
Underlying equity in net assets	$ 6,700
Cole/Mosaic JV South Elgin IL, LLC [Member]
Schedule of Equity Method Investments [Line Items]
Ownership %	50.00%
Carrying value of investment	$ 6,452
Cole/Faison JV Bethlehem GA, LLC [Member]
Schedule of Equity Method Investments [Line Items]
Ownership %	90.00%
Carrying value of investment	$ 13,185

XML

Real Estate Investments (Concentration Narrative) (Details) - Lease Revenue [Member]	3 Months Ended
	Mar. 31, 2016
Geographic Concentration [Member] | TEXAS
Product Information [Line Items]
Concentration risk	13.20%
Industry Concentration [Member] | Casual Dining [Member]
Product Information [Line Items]
Concentration risk	16.60%
Industry Concentration [Member] | Manufacturing Industries [Member]
Product Information [Line Items]
Concentration risk	10.10%

XML

Investment Securities, at Fair Value (Unrealized Gains and Losses) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Schedule of Available-for-sale Securities [Line Items]
Fair Value	$ 48,162	$ 53,304
CMBS [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	48,934	52,115
Gross Unrealized Gains	1,146	2,169
Gross Unrealized Losses	(1,918)	(980)
Fair Value	$ 48,162	$ 53,304

XML

Investment Securities, at Fair Value (Narrative) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($) security	Dec. 31, 2015 USD ($) security
Schedule of Available-for-sale Securities [Line Items]
Investment securities, at fair value | $	$ 48,162	$ 53,304
CMBS [Member]
Schedule of Available-for-sale Securities [Line Items]
Number of securities owned | security	9	10
Investment securities, at fair value | $	$ 48,162	$ 53,304
Number of securities paid in full prior to maturity | security	1
Carrying value of security paid in full prior to maturity (less than) | $	$ 100
Number of securities with fair value below amortized cost | security	5
CMBS [Member] | Minimum [Member]
Schedule of Available-for-sale Securities [Line Items]
Interest rate	5.88%
CMBS [Member] | Maximum [Member]
Schedule of Available-for-sale Securities [Line Items]
Interest rate	8.95%

XML

Investment Securities, at Fair Value (Scheduled Maturity of CMBS) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Fair Value
Total	$ 48,162	$ 53,304
CMBS [Member]
Amortized Cost
Due within one year	0
Due after one year through five years	21,656
Due after five years through 10 years	12,508
Due after 10 years	14,770
Amortized Cost	48,934	52,115
Fair Value
Due within one year	0
Due after one year through five years	22,316
Due after five years through 10 years	10,664
Due after 10 years	15,182
Total	$ 48,162	$ 53,304

XML

Mortgage Notes Receivable (Narrative) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($) loan	Mar. 31, 2015 USD ($)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of mortgage notes receivable	9
Weighted-average interest rate	6.30%
Weighted-average years to maturity	13 years 8 months 12 days
Principal repayments received from borrowers | $	$ 3,863	$ 3,668
Mortgage notes receivable [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of mortgage notes receivable	9
Number of mortgage notes receivable repaid at maturity	1
Principal repayments received from borrowers | $	$ 400
Number of mortgage notes with capitalized principal and interest	1

XML

Mortgage Notes Receivable (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Accounts, Notes, Loans and Financing Receivable [Line Items]
Carrying Value	$ 23,559	$ 24,238
Mortgage notes receivable [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Outstanding Balance	25,470
Carrying Value	$ 23,559
Mortgage notes receivable [Member] | Minimum [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Interest Rate Range	5.87%
Mortgage notes receivable [Member] | Maximum [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Interest Rate Range	7.24%

XML

Mortgage Notes Receivable (Aggregate Principal Payments) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	May. 04, 2016
Subsequent Event [Line Items]
Due within one year	$ 1,024
Due after one year through five years	5,344
Due after five years through 10 years	6,725
Due after 10 years	16,298
Total	$ 29,391
Subsequent Event [Member]
Subsequent Event [Line Items]
Interest scheduled to be capitalized		$ 3,900

XML

Rent and Tenant Receivables and Other Assets, Net (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Accounts receivable, net	$ 42,574		$ 44,798
Straight-line rent receivable	175,686		161,079
Deferred costs relating to revolving credit facility, net	23,499		26,110
Prepaid expenses	13,852		9,773
Leasehold improvements, property and equipment, net	17,889		18,180
Restricted escrow deposits	2,989		1,190
Deferred tax asset and tax receivable	21,335		25,287
Program development costs, net	13,578		12,855
Interest rate swap assets, at fair value	0		1,892
Other assets	2,501		2,473
Total	313,903		303,637
Allowance for doubtful accounts	7,900		6,600
Deferred Costs and Other Assets, Net [Member] | Program Development Costs [Member]
Property, Plant and Equipment [Line Items]
Reserves related to program development costs	37,800		34,800
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Amortization expense	300	$ 400
Accumulated amortization and depreciation	2,900		2,600
Property and Equipment [Member]
Property, Plant and Equipment [Line Items]
Accumulated amortization and depreciation	4,200		3,700
Depreciation expense	500	500
Line of Credit [Member]
Property, Plant and Equipment [Line Items]
Deferred costs relating to revolving credit facility, net	10,269		11,410
Amortization expense	2,600	$ 2,700
Debt outstanding	$ 22,000		$ 19,400

XML

Fair Value Measures (Fair Value of Assets and Liabilities, Measured on a Recurring Basis) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	$ 0	$ 1,892
Derivative liabilities	(13,800)	(6,922)
Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
CMBS	48,162	53,304
Derivative assets		1,892
Total assets		55,196
Derivative liabilities	(13,800)	(6,922)
Fair Value, Measurements, Recurring [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
CMBS	0	0
Derivative assets		0
Total assets		0
Derivative liabilities	0	0
Fair Value, Measurements, Recurring [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
CMBS	0	0
Derivative assets		1,892
Total assets		1,892
Derivative liabilities	(13,800)	(6,922)
Fair Value, Measurements, Recurring [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
CMBS	48,162	53,304
Derivative assets		0
Total assets		53,304
Derivative liabilities	$ 0	$ 0

XML

Fair Value Measures (Reconciliation of Instrument with Unobservable Inputs) (Details) - CMBS [Member] - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	$ 53,304	$ 58,646
Unrealized gain (loss) included in other comprehensive income, net	(1,961)	796
Principal payments received	(3,217)	(2,949)
Amortization included in net income	36
Ending balance	$ 48,162	$ 56,493

XML

Fair Value Measures (Fair Value of Financial Instruments by Balance Sheet Location) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Carrying Amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	$ 7,860,214	$ 8,122,477
Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	8,007,406	8,364,245
Level 3 [Member] | Carrying Amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage notes receivable	23,559	24,238
Level 3 [Member] | Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage notes receivable	32,008	31,842
Level 2 [Member] | Mortgage Notes Payable and Other Debt, Net [Member] | Carrying Amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	3,049,340	3,133,005
Level 2 [Member] | Mortgage Notes Payable and Other Debt, Net [Member] | Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	3,131,489	3,240,153
Level 2 [Member] | Corporate Bonds, Net [Member] | Senior Unsecured Note [Member] | Carrying Amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	2,547,452	2,547,255
Level 2 [Member] | Corporate Bonds, Net [Member] | Senior Unsecured Note [Member] | Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	2,578,973	2,580,786
Level 2 [Member] | Convertible Debt, Net [Member] | Convertible Senior Notes [Member] | Carrying Amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	983,422	982,217
Level 2 [Member] | Convertible Debt, Net [Member] | Convertible Senior Notes [Member] | Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	1,014,744	1,007,042
Level 2 [Member] | Credit Facility [Member] | Credit Facilities [Member] | Carrying Amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	1,280,000	1,460,000
Level 2 [Member] | Credit Facility [Member] | Credit Facilities [Member] | Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total liabilities	$ 1,282,200	$ 1,536,264

XML

Fair Value Measures (Narrative) (Details)	3 Months Ended
	Mar. 31, 2016 USD ($) property	Mar. 31, 2015 USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Properties impaired | property	125
Impairment charges	$ 160,517,000	$ 0
Minimum [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Discount rates	7.50%
Capitalization rates	7.00%
Maximum [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Discount rates	9.00%
Capitalization rates	12.46%
Weighted Average [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Discount rates	8.10%
Capitalization rates	7.80%
Reported Value Measurement [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Estimated fair value of real estate assets deemed to be impaired	$ 462,500,000

XML

Fair Value Measures (Impairment Charges by Asset Class) (Details)	3 Months Ended
	Mar. 31, 2016 USD ($) property	Mar. 31, 2015 USD ($)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Properties impaired | property	125
Total impairment loss	$ 160,517,000	$ 0
Investment in Real Estate Assets, Net [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total impairment loss	160,721,000
Below-Market Lease Liabilities, Net [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total impairment loss	$ (204,000)

XML

Debt (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Debt Disclosure [Abstract]
Debt outstanding	$ 7,802,565	$ 8,059,802
Weighted-average years to maturity	3 years 7 months 6 days
Weighted-average interest rate	3.79%

XML

Debt (Schedule of Debt) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($)
Debt [Roll Forward]
Deferred costs, Beginning balance	$ (26,110)
Total debt, Beginning balance	8,059,802
Debt Issuances	203,206
Repayments, Extinguishment and Assumptions	(460,715)
Accretion and (Amortization)	272
Deferred costs, Ending balance	(23,499)
Total debt, Ending balance	7,802,565
Mortgages and Other Debt [Member]
Debt [Roll Forward]
Total debt, Beginning balance	3,111,985
Debt Issuances	206
Repayments, Extinguishment and Assumptions	(77,715)
Accretion and (Amortization)	(4,810)
Total debt, Ending balance	3,029,666
Mortgage Notes Payable [Member]
Debt [Roll Forward]
Outstanding balance, Beginning balance	3,039,882
Net premiums (discount), Beginning balance	59,402
Deferred costs, Beginning balance	(21,020)
Debt Issuances	206
Repayments, Extinguishment and Assumptions	(72,785)
Repayments, Extinguishment and Assumptions, Net Premiums	(1,096)
Repayments, Extinguishment and Assumptions, Deferred costs	329
Accretion and (Amortization), (Premiums) Discount	(5,777)
Accretion and (Amortization), Deferred costs	1,017
Outstanding balance, Ending balance	2,967,303
Net premiums (discount), Ending balance	52,529
Deferred costs, Ending balance	(19,674)
Total debt, Ending balance	2,967,303
Other Debt [Member]
Debt [Roll Forward]
Outstanding balance, Beginning balance	33,463
Net premiums (discount), Beginning balance	258
Repayments, Extinguishment and Assumptions	(4,163)
Accretion and (Amortization), (Premiums) Discount	(50)
Outstanding balance, Ending balance	29,300
Net premiums (discount), Ending balance	208
Total debt, Ending balance	29,300
Corporate Bonds [Member]
Debt [Roll Forward]
Outstanding balance, Beginning balance	2,550,000
Net premiums (discount), Beginning balance	(2,745)
Deferred costs, Beginning balance	(10,922)
Total debt, Beginning balance	2,536,333
Accretion and (Amortization), (Premiums) Discount	197
Accretion and (Amortization), Deferred costs	1,169
Accretion and (Amortization)	1,366
Outstanding balance, Ending balance	2,550,000
Net premiums (discount), Ending balance	(2,548)
Deferred costs, Ending balance	(9,753)
Total debt, Ending balance	2,537,699
Convertible Debt [Member]
Debt [Roll Forward]
Outstanding balance, Beginning balance	1,000,000
Net premiums (discount), Beginning balance	(17,779)
Deferred costs, Beginning balance	(19,327)
Total debt, Beginning balance	962,894
Accretion and (Amortization), (Premiums) Discount	1,201
Accretion and (Amortization), Deferred costs	1,374
Accretion and (Amortization)	2,575
Outstanding balance, Ending balance	1,000,000
Net premiums (discount), Ending balance	(16,578)
Deferred costs, Ending balance	(17,953)
Total debt, Ending balance	965,469
Credit Facility [Member]
Debt [Roll Forward]
Outstanding balance, Beginning balance	1,460,000
Deferred costs, Beginning balance	(11,410)
Total debt, Beginning balance	1,448,590
Debt Issuances	203,000
Repayments, Extinguishment and Assumptions	(383,000)
Accretion and (Amortization), Deferred costs	1,141
Accretion and (Amortization)	1,141
Outstanding balance, Ending balance	1,280,000
Deferred costs, Ending balance	(10,269)
Total debt, Ending balance	$ 1,269,731

XML

Debt (Mortgage Notes Payable) (Details)	3 Months Ended
	Mar. 31, 2016 USD ($) property	Dec. 31, 2015 USD ($)
Debt Instrument [Line Items]
Weighted-Average Interest Rate	3.79%
Weighted-Average Years to Maturity	3 years 7 months 6 days
Line of Credit [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 1,280,000,000	$ 1,460,000,000
Mortgage Notes Payable [Member]
Debt Instrument [Line Items]
Encumbered Properties | property	652
Gross Carrying Value of Collateralized Properties	$ 5,558,642,000
Outstanding Balance	$ 2,967,303,000	$ 3,039,882,000
Weighted-Average Interest Rate	5.09%
Mortgage Notes Payable [Member] | Unconsolidated Joint Venture [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 46,300,000
Weighted-Average Interest Rate	3.88%
Fixed and variable rate, minimum	2.84%
Fixed and variable rate, maximum	5.20%
Mortgage Notes Payable [Member] | Weighted-Average [Member]
Debt Instrument [Line Items]
Weighted-Average Years to Maturity	4 years 10 months 24 days
Mortgage Notes Payable [Member] | Weighted-Average [Member] | Unconsolidated Joint Venture [Member]
Debt Instrument [Line Items]
Weighted-Average Years to Maturity	2 years 7 months 10 days
Mortgage Notes Payable [Member] | Fixed-rate debt [Member]
Debt Instrument [Line Items]
Encumbered Properties | property	651
Gross Carrying Value of Collateralized Properties	$ 5,533,845,000
Outstanding Balance	$ 2,958,859,000
Weighted-Average Interest Rate	5.10%
Mortgage Notes Payable [Member] | Fixed-rate debt [Member] | Interest Rate Swap [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 247,900,000
Mortgage Notes Payable [Member] | Fixed-rate debt [Member] | Weighted-Average [Member]
Debt Instrument [Line Items]
Weighted-Average Years to Maturity	4 years 10 months 28 days
Mortgage Notes Payable [Member] | Variable-rate debt [Member]
Debt Instrument [Line Items]
Encumbered Properties | property	1
Gross Carrying Value of Collateralized Properties	$ 24,797,000
Outstanding Balance	$ 8,444,000
Weighted-Average Interest Rate	3.39%
Mortgage Notes Payable [Member] | Variable-rate debt [Member] | Weighted-Average [Member]
Debt Instrument [Line Items]
Weighted-Average Years to Maturity	5 months 1 day
Mortgage Notes Payable [Member] | Recourse debt [Member] | Unconsolidated Joint Venture [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 0

XML

Debt (Mortgage Notes Payable) (Narrative) (Details) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2014
Debt Instrument [Line Items]
Extinguishment and forgiveness of debt, net	$ 0	$ (5,302,000)
Weighted-Average Interest Rate	3.79%
Weighted-average years to maturity	3 years 7 months 6 days
Mortgage Notes Payable [Member]
Debt Instrument [Line Items]
Weighted-Average Interest Rate	4.41%
Mortgage Notes Payable [Member]
Debt Instrument [Line Items]
Repayments and extinguishment	$ 55,000,000	72,300,000
Extinguishment and forgiveness of debt, net	$ 0	400,000
Weighted-Average Interest Rate	5.09%
Principal balance	$ 38,100,000	38,100,000	$ 53,800,000
Gain on forgiveness of debt		$ 4,900,000
Default rate of interest, per annum	10.68%
Mortgage Notes Payable [Member] | Weighted-Average [Member]
Debt Instrument [Line Items]
Weighted-average years to maturity	4 years 10 months 24 days
Mortgage Notes Payable [Member] | Mortgage Notes Payable [Member] | Weighted-Average [Member]
Debt Instrument [Line Items]
Weighted-average years to maturity	2 years 11 months 1 day

XML

Debt (Aggregate Principal Repayments on Mortgage Notes and Other Debt) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015	Mar. 31, 2015	Dec. 31, 2014
Debt Instrument [Line Items]
Total	$ 7,802,565	$ 8,059,802
Mortgage Notes Payable [Member]
Debt Instrument [Line Items]
April 1, 2016 - December 31, 2016	198,991
2017	412,546
2018	211,026
2019	231,461
2020	284,197
Thereafter	1,629,082
Total	2,967,303
Mortgage notes in connection with default from non-recourse loan	$ 38,100		$ 38,100	$ 53,800

XML

Debt (Other Debt) (Narrative) (Details) - Other Debt [Member] - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Debt Instrument [Line Items]
Outstanding Balance	$ 29,300	$ 33,463
Unamortized net premium	$ 208	$ 258
Interest rate	5.81%
Scheduled principal repayments, 2016	$ 8,300
Scheduled principal repayments, 2017	7,700
Scheduled principal repayments, 2018	$ 13,300

XML

Debt (Summary of Outstanding and Carrying Value of Collateral by Asset Type) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Debt Instrument [Line Items]
Outstanding Balance	$ 7,802,565	$ 8,059,802
Other Debt [Member]
Debt Instrument [Line Items]
Outstanding Balance	29,300
Collateral Carrying Value	61,333
Other Debt [Member] | Mortgage notes receivable [Member]
Debt Instrument [Line Items]
Outstanding Balance	8,095
Collateral Carrying Value	19,950
Other Debt [Member] | Intercompany mortgage loans [Member]
Debt Instrument [Line Items]
Outstanding Balance	2,264
Collateral Carrying Value	5,462
Other Debt [Member] | CMBS [Member]
Debt Instrument [Line Items]
Outstanding Balance	18,941
Collateral Carrying Value	$ 35,921

XML

Debt (Corporate Bonds) (Narrative) (Details) - Corporate Bonds [Member] $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($) loan	Dec. 31, 2015 USD ($)
Debt Instrument [Line Items]
Aggregate senior unsecured notes outstanding	$ 2,550,000	$ 2,550,000
VEREIT Operating Partnership, L.P. [Member]
Debt Instrument [Line Items]
Aggregate senior unsecured notes outstanding	$ 2,550,000
Interest rate	2.80%
Number of senior notes | loan	3
VEREIT Operating Partnership, L.P. [Member] | 2017 Senior Notes [Member]
Debt Instrument [Line Items]
Aggregate senior unsecured notes outstanding	$ 1,300,000
Interest rate	2.00%
VEREIT Operating Partnership, L.P. [Member] | 2019 Senior Notes [Member]
Debt Instrument [Line Items]
Aggregate senior unsecured notes outstanding	$ 750,000
Interest rate	3.00%
Redemption price, percentage of principal	100.00%
VEREIT Operating Partnership, L.P. [Member] | 2024 Senior Notes [Member]
Debt Instrument [Line Items]
Aggregate senior unsecured notes outstanding	$ 500,000
Interest rate	4.60%
Redemption price, percentage of principal	100.00%

XML

Debt (Corporate Bonds) (Details) - Corporate Bonds [Member] - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Debt Instrument [Line Items]
Outstanding Balance	$ 2,550,000	$ 2,550,000
VEREIT Operating Partnership, L.P. [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 2,550,000
Interest Rate	2.80%
2017 Senior Notes [Member] | VEREIT Operating Partnership, L.P. [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 1,300,000
Interest Rate	2.00%
2019 Senior Notes [Member] | VEREIT Operating Partnership, L.P. [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 750,000
Interest Rate	3.00%
2024 Senior Notes [Member] | VEREIT Operating Partnership, L.P. [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 500,000
Interest Rate	4.60%

XML

Debt (Convertible Debt) (Narrative) (Details) - Convertible Debt [Member] $ in Thousands	Mar. 31, 2016 USD ($) loan	Dec. 31, 2015 USD ($)
Debt Instrument [Line Items]
Outstanding Balance	$ 1,000,000	$ 1,000,000
VEREIT Operating Partnership, L.P. [Member]
Debt Instrument [Line Items]
Number of convertible notes | loan	2
Outstanding Balance	$ 1,000,000

XML

Debt (Convertible Debt) (Details)	3 Months Ended
	Mar. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Debt Instrument [Line Items]
Weighted-average interest rate	3.79%
Convertible Debt [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 1,000,000,000	$ 1,000,000,000
Unamortized discount	16,578,000	$ 17,779,000
Amount of General Partner OP Units per principal amount	1,000
VEREIT Operating Partnership, L.P. [Member]
Debt Instrument [Line Items]
Carrying value conversion options in additional paid-in capital	28,600,000
VEREIT Operating Partnership, L.P. [Member] | Convertible Debt [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 1,000,000,000
Weighted-average interest rate	3.30%
Remaining amortization period	3 years 3 months 18 days
VEREIT Operating Partnership, L.P. [Member] | Convertible Debt [Member] | 2018 Convertible Notes [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 597,500,000
Interest Rate	3.00%
Conversion Rate	60.5997
VEREIT Operating Partnership, L.P. [Member] | Convertible Debt [Member] | 2020 Convertible Notes [Member]
Debt Instrument [Line Items]
Outstanding Balance	$ 402,500,000
Interest Rate	3.75%
Conversion Rate	66.7249

XML

Debt (Credit Facility) (Narrative) (Details) - USD ($)			3 Months Ended
	Jul. 31, 2015	Jun. 30, 2014	Mar. 31, 2016	Dec. 31, 2015
Line of Credit Facility [Line Items]
Outstanding balance			$ 1,269,731,000	$ 1,448,590,000
VEREIT Operating Partnership, L.P. [Member]
Line of Credit Facility [Line Items]
Outstanding balance			1,269,731,000	$ 1,448,590,000
Credit Facility [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity		$ 3,600,000,000	3,300,000,000
Maximum aggregate amount outstanding at any one time	$ 25,000,000	50,000,000
Outstanding balance			$ 1,300,000,000
Length of extension option			1 year
Maximum leverage ratio			60.00%
Minimum fixed charge coverage ratio (of at least)			1.5
Secured leverage ratio (less than or equal to)			45.00%
Unencumbered asset value ratio (less than or equal to)			60.00%
Minimum tangible net worth covenant (of at least)			$ 5,500,000,000.0
Minimum unencumbered interest coverage ratio (of at least)			1.75
Minimum unencumbered asset value (of at least)			$ 8,000,000,000.0
Credit Facility [Member] | VEREIT Operating Partnership, L.P. [Member]
Line of Credit Facility [Line Items]
Remaining borrowing capacity			$ 2,000,000,000
Credit Facility [Member] | VEREIT Operating Partnership, L.P. [Member] | Minimum [Member]
Line of Credit Facility [Line Items]
Commitment fee percentage			0.15%
Credit Facility [Member] | VEREIT Operating Partnership, L.P. [Member] | Maximum [Member]
Line of Credit Facility [Line Items]
Commitment fee percentage			0.25%
Credit Facility [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity		2,450,000,000
Current borrowing capacity			$ 2,300,000,000
Credit Facility [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member]
Line of Credit Facility [Line Items]
Basis spread on variable rate			1.00%
Credit Facility [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member]
Line of Credit Facility [Line Items]
Basis spread on variable rate			1.80%
Credit Facility [Member] | Revolving Credit Facility [Member] | Base Rate [Member] | Minimum [Member]
Line of Credit Facility [Line Items]
Basis spread on variable rate			0.00%
Credit Facility [Member] | Revolving Credit Facility [Member] | Base Rate [Member] | Maximum [Member]
Line of Credit Facility [Line Items]
Basis spread on variable rate			0.80%
Credit Facility [Member] | Revolving Credit Facility [Member] | Federal Funds Rate [Member]
Line of Credit Facility [Line Items]
Basis spread on variable rate			0.50%
Credit Facility [Member] | Multicurrency Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Elimination of debt	150,000,000
Credit Facility [Member] | Unencumbered Asset [Member]
Line of Credit Facility [Line Items]
Unencumbered Asset Value	$ 8,000,000,000	$ 10,500,000,000
Credit Facility [Member] | Unencumbered Asset [Member] | Tranche One [Member]
Line of Credit Facility [Line Items]
Unencumbered Asset Value ratio			30.00%
Credit Facility [Member] | Unencumbered Asset [Member] | Tranche Two [Member]
Line of Credit Facility [Line Items]
Unencumbered Asset Value ratio			40.00%
Credit Facility [Member] | Unencumbered Asset [Member] | Tranche Three [Member]
Line of Credit Facility [Line Items]
Unencumbered Asset Value ratio			35.00%
Credit Facility [Member] | Unencumbered Asset [Member] | Tranche Four [Member]
Line of Credit Facility [Line Items]
Unencumbered Asset Value ratio			30.00%
Credit Facility [Member] | Term Loan [Member]
Line of Credit Facility [Line Items]
Current borrowing capacity			$ 1,000,000,000
Credit Facility [Member] | Term Loan [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member]
Line of Credit Facility [Line Items]
Basis spread on variable rate			1.15%
Credit Facility [Member] | Term Loan [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member]
Line of Credit Facility [Line Items]
Basis spread on variable rate			2.05%
Credit Facility [Member] | Term Loan [Member] | Base Rate [Member] | Minimum [Member]
Line of Credit Facility [Line Items]
Basis spread on variable rate			0.15%
Credit Facility [Member] | Term Loan [Member] | Base Rate [Member] | Maximum [Member]
Line of Credit Facility [Line Items]
Basis spread on variable rate			1.05%
Credit Facility [Member] | Floating Interest Rate [Member]
Line of Credit Facility [Line Items]
Outstanding balance			$ 300,000,000
Variable interest rate			2.24%
Credit Facility [Member] | Fixed Interest Rate [Member]
Line of Credit Facility [Line Items]
Outstanding balance			$ 1,000,000,000
Line of credit, amount bearing fixed interest rate, percentage			3.2899%

XML

Derivatives and Hedging Activities (Narrative) (Details) - USD ($)	1 Months Ended		3 Months Ended
	Feb. 28, 2014	Jan. 31, 2014	Mar. 31, 2016	Mar. 31, 2015
Interest Rate Swap [Member]
Derivative [Line Items]
Amount of gain (loss) recognized in income on derivative (ineffective portion, reclassifications of missed forecasted transactions and amounts excluded from effectiveness testing)			$ 1,100,000	$ 1,000,000
Fair value interest rate derivatives			15,200,000
Aggregate termination value had provisions been breached			15,200,000
Interest Rate Swap [Member] | Interest Expense [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative gain (loss) to be reclassified during next 12 months			6,000,000
Treasury Lock [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative, notional amount		$ 250,000,000
Term of derivative contract		10 years
Loss from settlement of derivative	$ 3,900,000
Treasury Lock [Member] | Interest Expense [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Interest expense			$ 100,000

XML

Derivatives and Hedging Activities (Schedule of Interest Rate Derivatives) (Details) - Interest Rate Swap [Member] - Cash Flow Hedging [Member]	Mar. 31, 2016 USD ($) derivative
Designated as Hedging Instrument [Member]
Derivative [Line Items]
Number of Instruments | derivative	16
Notional Amount | $	$ 1,211,457,000
Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Number of Instruments | derivative	1
Notional Amount | $	$ 51,400,000

XML

Derivatives and Hedging Activities (Schedule of Derivative Instruments in Statement of Financial Position, Fair Value) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Derivatives, Fair Value [Line Items]
Derivative assets	$ 0	$ 1,892
Derivative liabilities	(13,800)	(6,922)
Interest Rate Swap [Member] | Not Designated as Hedging Instrument [Member] | Rent and Tenant Receivables and Other Assets, Net [Member]
Derivatives, Fair Value [Line Items]
Derivative assets	0	98
Interest Rate Swap [Member] | Not Designated as Hedging Instrument [Member] | Deferred Rent, Derivative and Other Liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liabilities	(811)	0
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Rent and Tenant Receivables and Other Assets, Net [Member]
Derivatives, Fair Value [Line Items]
Derivative assets	0	1,794
Cash Flow Hedging [Member] | Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | Deferred Rent, Derivative and Other Liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liabilities	$ (12,989)	$ (6,922)

XML

Derivatives and Hedging Activities (Tabular Disclosure Offsetting Derivatives) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Gross Amounts of Recognized Assets	$ 0	$ 1,892
Gross Amounts of Recognized Liabilities	(13,800)	(6,922)
Gross Amounts Offset in the Consolidated Balance Sheets	0	0
Net Amounts of Assets Presented in the Consolidated Balance Sheets	0	1,892
Net Amounts of Liabilities Presented in the Consolidated Balance Sheets	(13,800)	(6,922)
Financial Instruments	0	0
Cash Collateral Received	0	0
Net Amount	$ (13,800)	$ (5,030)

XML

Supplemental Cash Flow Disclosures (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Supplemental Disclosures:
Cash paid for interest	$ 93,713	$ 109,025
Cash paid for income taxes	10,848	51
Non-cash investing and financing activities:
Accrued capital expenditures and real estate developments	1,327	4,126
Accrued repurchases of common stock to settle tax obligation	223	0
Accrued distributions	3,157	0
Mortgage note payable relieved by foreclosure	0	53,798
Mortgage notes payable assumed in real estate disposition	$ 55,000	$ 24,000

XML

Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Payables and Accruals [Abstract]
Accrued interest	$ 40,215	$ 56,273
Accrued real estate taxes	35,134	47,319
Accrued legal fees	13,922	9,212
Accounts payable	2,547	2,868
Accrued other	27,152	36,205
Accounts payable and accrued expenses	$ 118,970	$ 151,877

XML

Commitments and Contingencies (Litigation) (Narrative) (Details)	1 Months Ended
	Dec. 31, 2013 USD ($)	Oct. 31, 2013	Oct. 28, 2015 lawsuit	Jan. 31, 2015 lawsuit	Jan. 20, 2015 lawsuit	Apr. 30, 2013 lawsuit	Mar. 31, 2013 lawsuit
Pending Litigation [Member] | Claims Under The Securities Act of 1933 and Securities Exchange Act of 1934 [Member]
Loss Contingencies [Line Items]
Number of claims			4
SDNY Actions [Member] | Pending Litigation [Member]
Loss Contingencies [Line Items]
Number of claims					10
Securities Fraud Action [Member] | Stayed Litigation [Member] | Claims Under The Securities Act of 1933 [Member]
Loss Contingencies [Line Items]
Number of claims				2
John Poling Putative Class Action [Member] | Series B Cumulative Preferred [Member] | CapLease [Member]
Loss Contingencies [Line Items]
Preferred stock, dividend rate		8.375%
John Poling Putative Class Action [Member] | Series C Cumulative Preferred Stock [Member] | CapLease [Member]
Loss Contingencies [Line Items]
Preferred stock, dividend rate		7.25%
Class Action [Member] | Stayed Litigation [Member] | Claims Under The Securities Act of 1933 [Member]
Loss Contingencies [Line Items]
Number of claims						1	1
Putative Class Action [Member] | Pending Litigation [Member]
Loss Contingencies [Line Items]
Stipulation of settlement, maximum attorney fees | $	$ 625,000

XML

Commitments and Contingencies (Future Obligations) (Details) $ in Thousands	Mar. 31, 2016 USD ($)
Ground Leases [Member]
Operating Leased Assets [Line Items]
April 1, 2016 - December 31, 2016	$ 10,659
2017	14,820
2018	14,410
2019	14,146
2020	13,386
Thereafter	224,648
Total	292,069
Office Leases [Member]
Operating Leased Assets [Line Items]
April 1, 2016 - December 31, 2016	3,793
2017	4,585
2018	4,704
2019	4,769
2020	4,797
Thereafter	14,089
Total	$ 36,737

XML

Commitments and Contingencies (Purchase Commitments) (Narrative) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($) property real_estate_investment_trust agreement	Dec. 31, 2015 USD ($)
Unrecorded Unconditional Purchase Obligation [Line Items]
Escrow deposits	$ 2,989	$ 1,190
Purchase Commitment [Member] | Private Capital Management Segment [Member]
Unrecorded Unconditional Purchase Obligation [Line Items]
Number of Managed REITs to be assigned | real_estate_investment_trust	1
Number of purchase and sale agreements | agreement	8
Percentage of voting interests acquired	100.00%
Number of properties acquired | property	18
Aggregate purchase price	$ 160,400
Escrow deposits	$ 3,000

XML

Equity (Common Stock and General Partner Common OP Units) (Narrative) (Details) - shares	Mar. 31, 2016	Dec. 31, 2015
Class of Stock [Line Items]
Common stock, shares authorized (shares)	1,500,000,000	1,500,000,000
Common stock, shares issued (shares)	904,757,365	904,884,394
Common stock, shares outstanding (shares)	904,757,365	904,884,394
VEREIT Operating Partnership, L.P. [Member] | Common Stock [Member]
Class of Stock [Line Items]
General partners', units issued (shares)	904,757,365	904,884,394
General partners', units outstanding (shares)	904,757,365	904,884,394
General Partner [Member] | VEREIT Operating Partnership, L.P. [Member] | Common Stock [Member]
Class of Stock [Line Items]
General partners', units issued (shares)	904,757,365

XML

Equity (Series F Preferred Stock) (Narrative) (Details) - $ / shares			3 Months Ended
	Jul. 28, 2015	Jan. 03, 2014	Mar. 31, 2016	Dec. 31, 2015
Class of Stock [Line Items]
Preferred stock, shares issued (shares)			42,834,138	42,834,138
Preferred stock, shares outstanding (shares)			42,834,138	42,834,138
VEREIT Operating Partnership, L.P. [Member] | Preferred Units [Member]
Class of Stock [Line Items]
General partners', units issued (shares)			42,834,138	42,834,138
Series F preferred units (shares)			86,874	86,874
General partners', units outstanding (shares)			42,834,138	42,834,138
Limited partners', units outstanding (shares)			86,874	86,874
Series F Preferred Stock [Member]
Class of Stock [Line Items]
Preferred stock, dividend rate	6.70%		6.70%
Preferred stock, liquidation preference per share (in dollars per share)			$ 25.00
Dividend rate (in dollars per share)			$ 1.675
ARCT IV [Member] | Series F Preferred Stock [Member] | VEREIT Operating Partnership, L.P. [Member] | Preferred Units [Member]
Class of Stock [Line Items]
General partners', units issued (shares)		42,200,000
ARCT IV OP Merger [Member] | ARCT IV [Member]
Class of Stock [Line Items]
Equity interest issued or issuable (shares)		42,200,000
ARCT IV OP Merger [Member] | ARCT IV [Member] | Series F Preferred Stock [Member] | VEREIT Operating Partnership, L.P. [Member] | Preferred Units [Member]
Class of Stock [Line Items]
Series F preferred units (shares)		700,000

XML

Equity (Limited Partner OP Units) (Narrative) (Details) - Common Stock [Member] - VEREIT Operating Partnership, L.P. [Member] - USD ($) $ / shares in Units, $ in Millions	Mar. 11, 2015	Mar. 31, 2016	Dec. 31, 2015	Mar. 31, 2015
Class of Stock [Line Items]
Limited partners', units outstanding (shares)		23,763,797	23,763,797
Limited Partner [Member]
Class of Stock [Line Items]
Limited partners', units outstanding (shares)		23,763,797	23,763,797	23,763,797
Number of units requested for redemption (shares)	13,100,000
Amount of redemption request	$ 126.7
Redemption price (in dollars per share)	$ 9.65

XML

Equity (Common Stock Dividends) (Narrative) (Details) - $ / shares		3 Months Ended
	Feb. 23, 2016	Mar. 31, 2016	Mar. 31, 2015
Equity [Abstract]
Quarterly dividend of common stock declared (in dollar per share)	$ 0.1375	$ 0.14	$ 0
Annualized dividend rate (in dollars per share)	$ 0.55

XML

Equity (Common Stock Repurchases) (Narrative) (Details)	3 Months Ended
	Mar. 31, 2016 shares
General Partner [Member]
Class of Stock [Line Items]
Common stock repurchases (shares)	127,741

XML

Equity-based Compensation (Equity Plan) (Narrative) (Details) - Equity Plan [Member] shares in Millions	3 Months Ended
	Mar. 31, 2016 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum authorized amount as a percentage of shares authorized	10.00%
Shares available for future issuance (shares)	85.0
Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cumulative Restricted share awards (shares)	4.2
Cumulative Restricted share awards forfeited (shares)	3.5
Cumulative Restricted Stock Units (shares)	3.6
Cumulative Restricted Stock Units forfeited (shares)	0.4
Cumulative Deferred Stock Units (shares)	0.1
Shares issued in period (shares)	7.9

XML

Equity-based Compensation (Restricted Stock) (Narrative) (Details) $ in Millions	3 Months Ended
	Mar. 31, 2016 USD ($)
General and Administrative Expense [Member] | Equity Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense	$ 0.3

XML

Equity-based Compensation (Restricted Stock) (Details) - Equity Plan [Member] - Restricted Stock [Member]	3 Months Ended
	Mar. 31, 2016 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested shares, Beginning Balance (shares) | shares	1,239,662
Vested (shares) | shares	(363,973)
Forfeited (shares) | shares	(7,253)
Unvested shares, Ending Balance (shares) | shares	868,436
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Unvested shares, Beginning Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 13.86
Vested, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	14.12
Forfeited, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	14.02
Unvested shares, Ending Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 13.75

XML

Equity-based Compensation (Time-Based Restricted Stock Units) (Narrative) (Details) - Time-Based Restricted Stock Units [Member] - Equity Plan [Member] $ in Millions	3 Months Ended
	Mar. 31, 2016 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Requisite service period	3 years
General and Administrative Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense	$ 0.6

XML

Equity-based Compensation (Deferred Stock Units) (Narrative) (Details) - Equity Plan [Member] - Deferred Stock Units [Member]	3 Months Ended
	Mar. 31, 2016 USD ($) shares
General and Administrative Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense | $	$ 33,700
General Partner [Member] | Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Right to receive common stock, number of shares (shares) | shares	1

XML

Equity-based Compensation (Time-Based Restricted Stock Units and Deferred Stock Units) (Details) - Equity Plan [Member]	3 Months Ended
	Mar. 31, 2016 $ / shares shares
Time-Based Restricted Stock Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested shares, Beginning Balance (shares) | shares	589,138
Granted (shares) | shares	725,921
Vested (shares) | shares	(7,965)
Unvested shares, Ending Balance (shares) | shares	1,307,094
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Unvested shares, Beginning Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 9.61
Granted, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	7.81
Vested, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	9.76
Unvested shares, Ending Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 8.61
Deferred Stock Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested shares, Beginning Balance (shares) | shares	0
Granted (shares) | shares	0
Vested (shares) | shares	0
Unvested shares, Ending Balance (shares) | shares	0
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Unvested shares, Beginning Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 0.00
Granted, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	0.00
Vested, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	0.00
Unvested shares, Ending Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 0.00

XML

Equity-based Compensation (Market-Based Restricted Stock Units) (Narrative) (Details) - Market-Based Restricted Stock Units [Member] - Equity Plan [Member] - USD ($) $ / shares in Units, $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Closing price threshold (in dollars per share)		$ 10
Closing price, threshold for consecutive trading days		20 days
General and Administrative Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense	$ 0.2

XML

Equity-based Compensation (Long-Term Incentive Awards) (Narrative) (Details) $ in Millions	3 Months Ended
	Mar. 31, 2016 USD ($)
Equity Plan [Member] | Long Term Incentive Target Awards [Member] | General and Administrative Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense	$ 1.0

XML

Equity-based Compensation (Market-Based Restricted Stock Units and LTI Target Awards) (Details) - Equity Plan [Member]	3 Months Ended
	Mar. 31, 2016 $ / shares shares
Market-Based Restricted Stock Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested shares, Beginning Balance (shares) | shares	704,804
Granted (shares) | shares	0
Forfeited (shares) | shares	(25,677)
Unvested shares, Ending Balance (shares) | shares	679,127
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Unvested shares, Beginning Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 8.58
Granted, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	0.00
Forfeited, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	8.58
Unvested shares, Ending Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 8.58
LTI Target Awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested shares, Beginning Balance (shares) | shares	731,448
Granted (shares) | shares	850,942
Forfeited (shares) | shares	0
Unvested shares, Ending Balance (shares) | shares	1,582,390
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Unvested shares, Beginning Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 11.38
Granted, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	7.13
Forfeited, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	0.00
Unvested shares, Ending Balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ / shares	$ 9.09

XML

Related Party Transactions (Narrative) (Details) $ in Millions	3 Months Ended
	Mar. 31, 2016 USD ($) property	Dec. 31, 2015 USD ($)
Selling commissions [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	100.00%
Cole REITs [Member] | Selling commissions [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	100.00%
Cole REITs [Member] | Program Development Costs [Member] | Rent and Tenant Receivables and Other Assets, Net [Member]
Related Party Transaction [Line Items]
Organization and offering costs	$ 13.6	$ 12.9
Reserves related to program development costs	$ 37.8	$ 34.8
Cole REITs [Member] | Disposition Fee Revenue [Member]
Related Party Transaction [Line Items]
Number (or more) of properties to earn disposition fees | property	1
INAV [Member]
Related Party Transaction [Line Items]
Threshold for return on stockholders' capital	6.00%

XML

Related Party Transactions and Arrangements (Offering Fee Summary for Cole REITs) (Details)	Mar. 31, 2016
Selling commissions [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	100.00%
CCPT V [Member] | Selling Commissions [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage of gross offering proceeds	7.00%
CCPT V [Member] | Dealer Manager and Distributions Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage of gross offering proceeds	2.00%
INAV [Member] | Selling Commissions [Member] | Advisor Class Shares [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage of offering price per share (up to)	3.75%
INAV [Member] | Dealer Manager and Distributions Fees [Member] | Wrap Class Shares [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage of gross offering proceeds	0.55%
INAV [Member] | Dealer Manager and Distributions Fees [Member] | Advisor Class Shares [Member] | Maximum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage of gross offering proceeds	0.55%
INAV [Member] | Dealer Manager and Distributions Fees [Member] | Advisor Class Shares [Member] | Minimum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage of gross offering proceeds	0.50%
INAV [Member] | Dealer Manager and Distributions Fees [Member] | Institutional Class Shares [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage of gross offering proceeds	0.25%
CCIT II [Member] | Selling Commissions [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage of gross offering proceeds	7.00%
CCIT II [Member] | Dealer Manager and Distributions Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage of gross offering proceeds	2.00%

XML

Related Party Transactions and Arrangements (Transaction-Related Fees for Cole REITs) (Details)	Mar. 31, 2016
CCPT V [Member]
Related Party Transaction [Line Items]
Threshold for return on stockholders' capital	6.00%
CCPT V [Member] | Acquisition Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	2.00%
CCPT V [Member] | Disposition Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	1.00%
CCPT V [Member] | Performance Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	15.00%
INAV [Member]
Related Party Transaction [Line Items]
Threshold for return on stockholders' capital	6.00%
INAV [Member] | Acquisition Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.00%
INAV [Member] | Disposition Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.00%
INAV [Member] | Performance Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.00%
CCIT II [Member]
Related Party Transaction [Line Items]
Threshold for return on stockholders' capital	8.00%
CCIT II [Member] | Acquisition Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	2.00%
CCIT II [Member] | Disposition Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	1.00%
CCIT II [Member] | Performance Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	15.00%
CCPT IV [Member]
Related Party Transaction [Line Items]
Threshold for return on stockholders' capital	8.00%
CCPT IV [Member] | Acquisition Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	2.00%
CCPT IV [Member] | Disposition Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	1.00%
CCPT IV [Member] | Performance Fees [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	15.00%

XML

Related Party Transactions and Arrangements (Management Fees for Cole REITs) (Details)	Mar. 31, 2016
CCPT V [Member]
Related Party Transaction [Line Items]
Threshold for return on stockholders' capital	6.00%
CCPT V [Member] | Asset Management / Advisory Fees [Member] | Minimum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.65%
CCPT V [Member] | Asset Management / Advisory Fees [Member] | Maximum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.75%
INAV [Member]
Related Party Transaction [Line Items]
Threshold for return on stockholders' capital	6.00%
INAV [Member] | Asset Management / Advisory Fees [Member] | Minimum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.90%
INAV [Member] | Performance Fees [Member] | Maximum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	25.00%
CCIT II [Member]
Related Party Transaction [Line Items]
Threshold for return on stockholders' capital	8.00%
CCIT II [Member] | Asset Management / Advisory Fees [Member] | Minimum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.65%
CCIT II [Member] | Asset Management / Advisory Fees [Member] | Maximum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.75%
CCPT IV [Member]
Related Party Transaction [Line Items]
Threshold for return on stockholders' capital	8.00%
CCPT IV [Member] | Asset Management / Advisory Fees [Member] | Minimum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.65%
CCPT IV [Member] | Asset Management / Advisory Fees [Member] | Maximum [Member]
Related Party Transaction [Line Items]
Revenue from related party, percentage	0.75%

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Related Party Transactions and Arrangements (Revenue from Cole REITs) (Details) $ in Thousands		3 Months Ended
	Jan. 29, 2015 USD ($)	Mar. 31, 2016 USD ($) real_estate_program	Mar. 31, 2015 USD ($)
Related Party Transaction [Line Items]
Related-party revenues		$ 31,311	$ 26,728
Number of real estate programs excluded from related party revenues | real_estate_program		1,031
Affiliated Entity [Member] | Revolving Credit Facility [Member] | Credit Facility [Member]
Related Party Transaction [Line Items]
Interest income		$ 308	408
Offering-related fees and reimbursements [Member]
Related Party Transaction [Line Items]
Related-party revenues		12,391	3,117
Securities commissions [Member]
Related Party Transaction [Line Items]
Related-party revenues		7,041	1,775
Dealer manager and distribution fees [Member]
Related Party Transaction [Line Items]
Related-party revenues		2,640	716
Reimbursement revenue [Member]
Related Party Transaction [Line Items]
Related-party revenues		2,710	626
Transaction service fees and reimbursements [Member]
Related Party Transaction [Line Items]
Related-party revenues		2,384	9,409
Acquisition fees [Member]
Related Party Transaction [Line Items]
Related-party revenues		1,702	4,488
Disposition fees [Member]
Related Party Transaction [Line Items]
Related-party revenues		0	4,350
Reimbursement revenues [Member]
Related Party Transaction [Line Items]
Related-party revenues		682	571
Management fees and reimbursements [Member]
Related Party Transaction [Line Items]
Related-party revenues		16,228	13,794
Asset and property management fees and leasing fees [Member]
Related Party Transaction [Line Items]
Related-party revenues		55	103
Advisory and performance fee revenue [Member]
Related Party Transaction [Line Items]
Related-party revenues		12,050	11,173
Reimbursement revenues [Member]
Related Party Transaction [Line Items]
Related-party revenues		$ 4,123	2,518
Selling commissions [Member]
Related Party Transaction [Line Items]
Selling commissions reallowed		100.00%
Dealer manager fees reimbursement [Member]
Related Party Transaction [Line Items]
Related-party revenues		$ 1,000	300
Disposition fee revenue [Member] | CCIT [Member]
Related Party Transaction [Line Items]
Related-party revenues	$ 4,400
Revenue from Managed Real Estate Investment Trusts, Excluding Fees from Real Estate Programs [Member]
Related Party Transaction [Line Items]
Related-party revenues		$ 200	$ 1,200

XML

Related Party Transactions and Arrangements (Investment in the Cole REITs) (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Related Party Transaction [Line Items]
Carrying Amount of Investment	$ 23,445		$ 56,824
Net loss	(206)	$ (28)
Cole REITs [Member]
Related Party Transaction [Line Items]
Carrying Amount of Investment	3,809
Net loss	122	$ 44
Cole REITs [Member]
Related Party Transaction [Line Items]
Carrying Amount of Investment	$ 3,800		$ 4,100

XML

Related Party Transactions and Arrangements (Schedule of Investment in the Cole REITs) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Related Party Transaction [Line Items]
Carrying Amount of Investment	$ 23,445	$ 56,824
Funds not yet in offering	600
Cole REITs [Member]
Related Party Transaction [Line Items]
Carrying Amount of Investment	$ 3,809
CCPT V [Member]
Related Party Transaction [Line Items]
% of Outstanding Shares Owned	1.14%
Carrying Amount of Investment	$ 1,553
INAV [Member]
Related Party Transaction [Line Items]
% of Outstanding Shares Owned	0.12%
Carrying Amount of Investment	$ 149
CCIT II [Member]
Related Party Transaction [Line Items]
% of Outstanding Shares Owned	0.58%
Carrying Amount of Investment	$ 1,388
CCPT IV [Member]
Related Party Transaction [Line Items]
% of Outstanding Shares Owned	0.01%
Carrying Amount of Investment	$ 119

XML

Related Party Transactions and Arrangements (Due To Affiliates) (Narrative) (Details) - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Related Party Transaction [Line Items]
Due to affiliates	$ 0	$ 230,000
Cole REITs [Member]
Related Party Transaction [Line Items]
Due to affiliates	$ 0	$ 200,000

XML

Related Party Transactions and Arrangements (Due from Affiliates) (Narrative) (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2016	Dec. 31, 2015	Jun. 30, 2014
Related Party Transaction [Line Items]
Due from affiliates	$ 11,617,000	$ 60,633,000
Credit Facility [Member]
Related Party Transaction [Line Items]
Increase to available borrowings	$ 3,300,000,000		$ 3,600,000,000
Credit Facility [Member] | Revolving Credit Facility [Member]
Related Party Transaction [Line Items]
Increase to available borrowings			$ 2,450,000,000
Credit Facility [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member]
Related Party Transaction [Line Items]
Basis spread on variable rate	1.00%
Credit Facility [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member]
Related Party Transaction [Line Items]
Basis spread on variable rate	1.80%
CCIT II [Member] | Credit Facility [Member] | Revolving Credit Facility [Member]
Related Party Transaction [Line Items]
Increase to available borrowings	$ 30,000,000.0	60,000,000
CCPT V [Member] | Credit Facility [Member] | Revolving Credit Facility [Member]
Related Party Transaction [Line Items]
Increase to available borrowings		60,000,000.0
Affiliated Entity [Member] | Credit Facility [Member] | Revolving Credit Facility [Member]
Related Party Transaction [Line Items]
Due from affiliates		$ 50,000,000
Affiliated Entity [Member] | Credit Facility [Member] | Revolving Credit Facility [Member] | CCPT V [Member]
Related Party Transaction [Line Items]
Repayments of related party debt	20,000,000
Affiliated Entity [Member] | Credit Facility [Member] | Revolving Credit Facility [Member] | CCIT II [Member]
Related Party Transaction [Line Items]
Repayments of related party debt	30,000,000
Affiliated Entity [Member] | Credit Facility [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member]
Related Party Transaction [Line Items]
Basis spread on variable rate		2.20%
Excluding balances from Cole REITs
Related Party Transaction [Line Items]
Due from affiliates	$ 11,600,000	$ 10,600,000

XML

Net Loss Per Share/Unit (Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Earnings Per Share [Abstract]
Net loss attributable to the General Partner	$ (113,086)	$ (29,970)
Less: dividends to preferred shares and participating securities	18,098	17,978
Net loss attributable to common stockholders / unitholders	$ (131,184)	$ (47,948)
Weighted average number of common shares outstanding - basic and diluted (shares)	903,825,726	902,996,270
Basic and diluted net loss per share attributable to common stockholders (in dollars per share)	$ (0.15)	$ (0.05)

XML

Net Loss Per Share/Unit (Narrative) (Details) shares in Millions	3 Months Ended
	Mar. 31, 2016 shares
Member Units [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	23.8
Restricted Stock and Restricted Stock Units (RSUs) [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	4.4
VEREIT Operating Partnership, L.P. [Member] | Restricted Stock Units (RSUs) [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	4.4

XML

Net Loss Per Share/Unit (Schedule of Earnings Per Share, Basic and Diluted, Operating Partnership) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Net loss from continuing operations attributable to the Operating Partnership	$ (113,086)	$ (29,970)
Less: dividends to preferred shares and participating securities	$ 18,098	$ 17,978
Weighted average number of common units outstanding - basic and diluted (shares)	903,825,726	902,996,270
VEREIT Operating Partnership, L.P. [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Net loss from continuing operations attributable to the Operating Partnership	$ (116,041)	$ (30,873)
Less: dividends to preferred shares and participating securities	18,098	17,978
Net loss attributable to common stockholders / unitholders	$ (134,139)	$ (48,851)
Weighted average number of common units outstanding - basic and diluted (shares)	927,589,523	926,760,067
Basic and diluted net loss per unit attributable to common unitholders (in dollars per share)	$ (0.15)	$ (0.05)

XML

Income Taxes (Narrative) (Details) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Segment Reporting Information [Line Items]
Provision (benefit) for income taxes	$ 56,000	$ 2,074,000
Unrecognized tax benefits	0	0
Cole Capital Segment [Member]
Segment Reporting Information [Line Items]
Provision (benefit) for income taxes	(1,300,000)	200,000
REI Segment [Member]
Segment Reporting Information [Line Items]
Provision (benefit) for income taxes	$ 1,400,000	$ 1,900,000

XML

Subsequent Events (Real Estate Investment Activity) (Details) $ in Thousands	1 Months Ended	3 Months Ended
	May. 03, 2016 USD ($) property	Mar. 31, 2016 USD ($) property	Mar. 31, 2015 USD ($)
Subsequent Event [Line Items]
Estimated gain on sale of properties		$ 17,175	$ (31,368)
2016 Property Dispositions [Member]
Subsequent Event [Line Items]
Number of real estate properties disposed | property		58
Aggregate gross sales price		$ 193,700
Estimated gain on sale of properties		$ 18,800
Subsequent Event [Member] | 2016 Property Dispositions [Member]
Subsequent Event [Line Items]
Number of real estate properties disposed | property	28
Aggregate gross sales price	$ 48,200
Estimated gain on sale of properties	$ 3,800

XML

Subsequent Events (Common Stock Dividend) (Details) - $ / shares			3 Months Ended
	May. 04, 2016	Feb. 23, 2016	Mar. 31, 2016	Mar. 31, 2015
Subsequent Event [Line Items]
Quarterly dividend of common stock declared (in dollar per share)		$ 0.1375	$ 0.14	$ 0
Annualized dividend rate (in dollars per share)		$ 0.55
Subsequent Event [Member]
Subsequent Event [Line Items]
Quarterly dividend of common stock declared (in dollar per share)	$ 0.1375
Annualized dividend rate (in dollars per share)	$ 0.55

XML

Subsequent Events (Preferred Stock Dividend) (Details) - Subsequent Event [Member]	May. 04, 2016 $ / shares
Subsequent Event [Line Items]
Dividend accrual period on annual basis	360 days
Annual dividend rate (in dollars per share)	$ 1.675
Annualized dividend rate, per 30-day month	$ 0.1395833

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Subsequent Events (New Cole REIT Share Class) (Details) - Subsequent Event [Member] - Common Class T [Member]	Apr. 29, 2016 real_estate_investment_trust
Cole REITs [Member]
Subsequent Event [Line Items]
Number of Cole REITs offering Class T shares of common stock	2
Selling commissions, percent of gross offering proceeds	3.00%
Dealer manager fees, percent of gross offering proceeds	2.00%
Distribution and stockholder servicing fee daily accrual rate	0.80%
CCIT II [Member]
Subsequent Event [Line Items]
Number of Cole REITs offering Class T shares of common stock	1
CCPT V [Member]
Subsequent Event [Line Items]
Number of Cole REITs offering Class T shares of common stock	1