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- **AFFO Growth**: Q3 2025 AFFO per share up 5.7% to $0.37, with full-year guidance raised to $1.49-$1.50.
- **Build-to-Suit Momentum**: $256.7 million invested in 7 build-to-suit projects with 7.5% initial cap rates, targeting $500 million in 2025.
- **Capital Markets Strength**: $350 million 5% senior notes issuance (7x oversubscribed), reducing leverage to 5.4x.
- **Tenant Credit Resilience**: No bad debt from At Home and Claire’s bankruptcies, maintaining 100% rent collection.
- **Industrial Growth Drivers**: Reshoring and e-commerce fueling $100+ million sq.ft. of industrial development pipeline in key markets.

**【CEO Summary Section】**
- **Revenue Growth and Strategic Investments**: BNL reported a 5.7% increase in quarterly AFFO per share, driven by $204 million invested in accretive acquisitions and development projects. The company emphasized a focus on industrial build-to-suit projects, with a goal of $500 million in 2025 investments.
- **Build-to-Suit Pipeline**: 7 build-to-suit developments started in 2025, with an estimated $256.7 million budget. The pipeline includes projects in logistics hubs like Dallas-Fort Worth and Atlanta, targeting 7.5% initial cap rates and 8.9% straight-line yields.
- **Tenant Credit Management**: Successfully navigated At Home and Claire’s bankruptcies with no bad debt incurred, maintaining 100% rent collection.
- **Capital Markets Activity**: Issued $350 million in investment-grade notes, 7x oversubscribed, and raised full-year AFFO guidance to $1.49-$1.50 per share.

**【CFO Financial Commentary】**
- **Financial Performance**: Q3 2025 AFFO was $74.3 million ($0.37 per share), up 5.7% year-over-year. Core G&A expenses were $7.4 million, tracking at the low end of $30-31 million annual guidance.
- **Debt and Liquidity**: Pro forma leverage of 5.4x with $900 million available on the revolver. Raised $350 million in 5% senior unsecured notes due 2032, reducing revolver balance.
- **Dividend Policy**: Maintained dividend coverage with a payout ratio declining due to earnings growth, yielding 6.5% at current share price.

**【Q&A Key Highlights】**
- **Build-to-Suit Strategy**: CEO John Moragne confirmed preference to hold build-to-suit assets long-term but noted potential sales to capture NAV upside. 2026 pipeline includes $28 million ABR growth, with 6.7% ABR expansion by end-2026.
- **Equity Issuance**: CFO Kevin Fennell stated equity issuance will be opportunistic, driven by pipeline needs and cost of capital, with ATM capacity available for accretive deals.
- **Construction Costs**: Despite tariffs and labor cost increases, build-to-suit economics remain viable, with hard costs a small percentage of total budgets.
- **Tenant Credit Outlook**: No material tenant credit risks identified for 2026, with focus on furniture/home furnishing and casual dining sectors.
- **Industrial Tailwinds**: Reshoring and e-commerce growth driving demand for logistics assets, with 100+ million sq.ft. of industrial space under development in key markets.


Broadstone Net Lease, Inc. (BNL) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

BNL

BNL fundamentals

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