Company: NNN
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0000950170-25-102429
Chunk: 6

Company: NNN REIT, INC.
Filing Date: 2025-08-05
Form: 10-Q
Item: Item 3
Chunk 6
---
NNN is exposed to interest rate risk primarily as a result of its variable rate Credit Facility and its fixed rate long-term debt which is used to finance NNN's Property acquisitions and construction commitments, as well as for general corporate purposes. NNN's interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flows and to reduce overall borrowing costs. To achieve its objectives, NNN borrows at both fixed and variable rates on its long-term debt and periodically uses derivatives to hedge the interest rate risk of future borrowings. As of June 30, 2025, NNN had no outstanding derivatives.

As of June 30, 2025, NNN's variable rate Credit Facility had $267,700,000 outstanding and a weighted average outstanding balance of $113,919,000 with a weighted average interest rate of 5.22% for the six months ended June 30, 2025 compared to a weighted average outstanding balance of $111,966,000 with a weighted average interest rate of 6.26% for the same period in 2024.

The information in the table below summarizes NNN's market risks associated with its debt obligations outstanding. The table presents, by year of expected maturity, principal payments and related interest rates for debt obligations outstanding as of June 30, 2025. The table incorporates only those debt obligations that existed as of June 30, 2025, and it does not consider those debt obligations or positions which could arise after this date and therefore has limited predictive value. As a result, NNN's ultimate realized gain or loss with respect to interest rate fluctuations will depend on the exposures that arise during the period, NNN's hedging strategies at that time and interest rates. If interest rates on NNN's variable rate debt increased by one percent, NNN's interest expense would have increased by less than one percent for the six months ended June 30, 2025.

     Debt Obligations(1) (dollars in thousands)

     Variable Rate Debt

     Fixed Rate Debt

     Credit Facility

     Unsecured Debt(2)

     Debt Obligation

     Weighted Average Interest Rate

     PrincipalDebtObligation

     EffectiveInterestRate

     2025
      
     $
     —

     —

     $
     400,000

     4.03
     %

     2026

     —

     —

     350,000

     3.73
     %