Note 3 – Real Estate Investments

Real Estate Portfolio

At September 30, 2015 and December 31, 2014, the Company’s gross investment in real estate assets, including properties under development, totaled $704,182,000 and $589,147,000, respectively. Real estate investments consisted of the following as of September 30, 2015 and December 31, 2014:

	September 30, 2015		December 31, 2014

Number of Properties		263		209
Gross Leasable Area		4,823,000		4,315,000

Land	$	209,688,872	$	195,091,303
Buildings		489,571,159		393,826,467
Property under Development		4,921,625		229,242
Gross Real Estate Investments	$	704,181,656	$	589,147,012

Less Accumulated Depreciation	$	(53,873,530)	$	(59,089,851)
Net Real Estate Investments	$	650,308,126	$	530,057,161

Lease Intangibles

The following table details lease intangibles, net of accumulated amortization, as of September 30, 2015 and December 31, 2014:

	September 30, 2015		December 31, 2014
Intangible Lease Asset - In-Place Leases	$	44,627,351	$	36,680,630
Less: Accumulated Amortization		(6,490,103)		(3,897,008)
Intangible Lease Asset - Above-Market Leases		51,574,206		31,642,267
Less: Accumulated Amortization		(6,662,862)		(4,111,435)
Intangible Lease Liability - Below-Market Leases		(21,098,523)		(15,124,210)
Less: Accumulated Amortization		3,621,555		2,289,358
Lease Intangible Asset, net	$	65,571,624	$	47,479,602

Investments

During the three months ended September 30, 2015, the Company purchased 15 retail net lease assets for approximately $36,937,000, including acquisition and closing costs. These properties are located in nine states and are leased to nine different tenants operating in six diverse retail sectors for a weighted average lease term of approximately 12.4 years. The underwritten weighted average capitalization rate on the Company’s third quarter 2015 acquisitions was approximately 8.1%.

During the nine months ended September 30, 2015, the Company purchased 59 retail net lease assets for approximately $160,587,000, including acquisition and closing costs. These properties are located in 21 states and are leased to 35 different tenants operating in 19 diverse retail sectors for a weighted average lease term of approximately 12.6 years. The underwritten weighted average capitalization rate on the Company’s acquisitions was approximately 8.0%.

The aggregate 2015 acquisitions for the nine months ended September 30, 2015 were allocated $19,667,000 to land, $118,933,000 to buildings and improvements, and $21,987,000 to lease intangibles. The acquisitions were all cash purchases and there was no contingent consideration associated with these acquisitions.

None of the Company’s acquisitions during the first nine months of 2015 caused any new or existing tenant to comprise 10% or more of its total assets or generate 10% or more of its total annualized base rent at September 30, 2015.

The Company calculates the underwritten weighted average capitalization rate on its acquisitions by dividing annual expected net operating income derived from the properties by the total investment in the properties. Annual expected net operating income is defined as the straight-line rent for the base term of the lease less property level expenses (if any) that are not recoverable from the tenant.

Dispositions

During the three months ended September 30, 2015, the Company sold four assets for gross proceeds of $19,805,000 including (i) Ferris Commons, a shopping center in Big Rapids, Michigan; (ii) Lakeland Plaza, a shopping center in Lakeland, Florida; (iii) a vacant land parcel in Sun Valley, Nevada; and and (iv) a second outlot to the Company’s Meijer store in Plainfield, Indiana. The Company recorded a net gain of approximately $8,599,000 on the sales.

During the nine months ended September 30, 2015, the Company sold eight assets for gross proceeds of $28,993,000 including the four assets described above, in addition to (i) Marshall Plaza, a Kmart-anchored shopping center in Marshall, Michigan; (ii) a former Border’s store in Lawrence, Kansas, which was the Company’s only vacant retail net lease property; (iii) an outlot to the Company’s Meijer’s store in Plainfield, Indiana; and (iv) a Sonic Restaurant in Waynesboro, Virginia. The Company recorded a net gain of approximately $12,135,000 on the sales.