10-Q 1 adc-20220930x10q.htm 10-Q
http://fasb.org/us-gaap/2022#RevenueFromContractWithCustomerIncludingAssessedTaxhttp://fasb.org/us-gaap/2022#RevenueFromContractWithCustomerIncludingAssessedTaxhttp://fasb.org/us-gaap/2022#RevenueFromContractWithCustomerIncludingAssessedTax0000917251--12-312022Q3falsehttp://fasb.org/us-gaap/2022#OtherAssetshttp://fasb.org/us-gaap/2022#OtherAssets0.040.04http://fasb.org/us-gaap/2022#AccountsPayableAndAccruedLiabilitiesCurrentAndNoncurrenthttp://fasb.org/us-gaap/2022#AccountsPayableAndAccruedLiabilitiesCurrentAndNoncurrenthttp://fasb.org/us-gaap/2022#AccountsPayableAndAccruedLiabilitiesCurrentAndNoncurrenthttp://fasb.org/us-gaap/2022#AccountsPayableAndAccruedLiabilitiesCurrentAndNoncurrenthttp://fasb.org/us-gaap/2022#OtherAssetshttp://fasb.org/us-gaap/2022#OtherAssets88573248712853114000001http://fasb.org/us-gaap/2022#RevenueFromContractWithCustomerIncludingAssessedTaxhttp://fasb.org/us-gaap/2022#AccountsPayableAndAccruedLiabilitiesCurrentAndNoncurrent0.0010000917251us-gaap:SeriesAPreferredStockMemberus-gaap:AdditionalPaidInCapitalMember2021-07-012021-09-300000917251us-gaap:SeriesAPreferredStockMember2021-07-012021-09-300000917251us-gaap:CommonStockMember2022-07-012022-09-300000917251us-gaap:CommonStockMember2022-04-012022-06-300000917251us-gaap:CommonStockMember2022-01-012022-03-310000917251us-gaap:RedeemablePreferredStockMemberus-gaap:OverAllotmentOptionMember2021-09-012021-09-300000917251us-gaap:SeriesAPreferredStockMemberus-gaap:PreferredStockMember2021-07-012021-09-300000917251us-gaap:CommonStockMember2021-07-012021-09-300000917251us-gaap:CommonStockMember2021-04-012021-06-300000917251us-gaap:CommonStockMember2021-01-012021-03-310000917251us-gaap:NoncontrollingInterestMember2022-09-300000917251us-gaap:AdditionalPaidInCapitalMember2022-09-300000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-09-300000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2022-09-300000917251us-gaap:NoncontrollingInterestMember2022-06-300000917251us-gaap:AdditionalPaidInCapitalMember2022-06-300000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-06-300000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2022-06-3000009172512022-06-300000917251us-gaap:NoncontrollingInterestMember2022-03-310000917251us-gaap:AdditionalPaidInCapitalMember2022-03-310000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2022-03-3100009172512022-03-310000917251us-gaap:NoncontrollingInterestMember2021-12-310000917251us-gaap:AdditionalPaidInCapitalMember2021-12-310000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-12-310000917251us-gaap:NoncontrollingInterestMember2021-09-300000917251us-gaap:AdditionalPaidInCapitalMember2021-09-300000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-09-300000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-09-300000917251us-gaap:NoncontrollingInterestMember2021-06-300000917251us-gaap:AdditionalPaidInCapitalMember2021-06-300000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-06-300000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-06-3000009172512021-06-300000917251us-gaap:NoncontrollingInterestMember2021-03-310000917251us-gaap:AdditionalPaidInCapitalMember2021-03-310000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-03-3100009172512021-03-310000917251us-gaap:NoncontrollingInterestMember2020-12-310000917251us-gaap:AdditionalPaidInCapitalMember2020-12-310000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2020-12-310000917251us-gaap:PreferredStockMember2022-06-300000917251us-gaap:PreferredStockMember2022-03-310000917251us-gaap:PreferredStockMember2021-12-310000917251us-gaap:CommonStockMember2021-12-310000917251us-gaap:CommonStockMember2020-12-310000917251adc:OmnibusIncentivePlan2020Member2020-05-310000917251adc:PerformanceUnitsAndSharesMember2021-01-012021-09-300000917251adc:PerformanceUnitsAndSharesMember2020-01-012020-09-300000917251us-gaap:PerformanceSharesMember2022-09-300000917251adc:PerformanceUnitsAndSharesMember2022-09-300000917251us-gaap:RestrictedStockMember2021-12-310000917251us-gaap:PerformanceSharesMember2021-12-310000917251adc:PerformanceUnitsAndSharesMember2021-12-310000917251srt:MaximumMemberadc:PerformanceUnitsAndSharesMember2022-01-012022-09-300000917251us-gaap:PerformanceSharesMember2021-01-012021-12-310000917251adc:PerformanceUnitsAndSharesMember2021-01-012021-12-310000917251adc:SeniorUnsecuredNotesMember2022-01-012022-09-300000917251us-gaap:MortgagesMember2022-01-012022-09-3000009172512021-01-012021-12-310000917251us-gaap:InterestExpenseMember2022-07-012022-09-300000917251us-gaap:InterestExpenseMember2022-01-012022-09-300000917251adc:GainLossOnExtinguishmentOfDebtAndSettlementOfRelatedHedgesMember2022-01-012022-09-300000917251us-gaap:InterestExpenseMember2021-07-012021-09-300000917251us-gaap:InterestExpenseMember2021-01-012021-09-300000917251adc:GainLossOnExtinguishmentOfDebtAndSettlementOfRelatedHedgesMember2021-01-012021-09-300000917251srt:MinimumMemberus-gaap:BuildingImprovementsMember2022-01-012022-09-300000917251srt:MaximumMemberus-gaap:BuildingImprovementsMember2022-01-012022-09-300000917251us-gaap:BuildingMember2022-01-012022-09-300000917251us-gaap:SeriesAPreferredStockMemberus-gaap:OverAllotmentOptionMember2021-09-012021-09-300000917251us-gaap:CommonStockMemberus-gaap:SubsequentEventMemberus-gaap:OverAllotmentOptionMember2022-10-012022-10-310000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberadc:AtMarketProgram2022Member2022-07-012022-09-300000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberus-gaap:OverAllotmentOptionMember2022-05-012022-05-310000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberus-gaap:OverAllotmentOptionMember2021-12-012021-12-310000917251us-gaap:CommonStockMemberus-gaap:OverAllotmentOptionMember2021-06-012021-06-300000917251us-gaap:CommonStockMemberus-gaap:OverAllotmentOptionMember2021-01-012021-01-310000917251us-gaap:SeriesAPreferredStockMember2022-09-300000917251us-gaap:SeriesAPreferredStockMember2021-12-310000917251us-gaap:SeriesAPreferredStockMember2021-09-300000917251us-gaap:RedeemablePreferredStockMember2021-09-300000917251us-gaap:RedeemablePreferredStockMember2022-07-012022-09-300000917251us-gaap:SeriesAPreferredStockMember2021-09-012021-09-300000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-07-012022-09-300000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-04-012022-06-300000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-07-012021-09-300000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-04-012021-06-300000917251us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000917251us-gaap:InterestRateSwapMember2022-07-012022-09-300000917251us-gaap:InterestRateSwapMember2022-01-012022-09-300000917251us-gaap:InterestRateSwapMember2021-07-012021-09-300000917251us-gaap:InterestRateSwapMember2021-01-012021-09-300000917251adc:AgreeRealtyCorporationMemberus-gaap:OtherOwnershipInterestMember2022-01-012022-09-300000917251adc:AgreeRealtyCorporationMemberus-gaap:OtherOwnershipInterestMember2021-01-012021-12-310000917251adc:AgreeRealtyCorporationMemberus-gaap:GeneralPartnerMemberus-gaap:SeriesAPreferredStockMember2022-01-012022-09-300000917251adc:AgreeRealtyCorporationMemberus-gaap:GeneralPartnerMember2022-01-012022-09-300000917251adc:AgreeRealtyCorporationMemberus-gaap:GeneralPartnerMember2021-01-012021-12-310000917251us-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateSwapMember2022-09-300000917251us-gaap:InterestRateSwapMember2022-09-300000917251us-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateSwapMember2021-12-310000917251us-gaap:InterestRateSwapMember2021-12-310000917251us-gaap:AccountsPayableAndAccruedLiabilitiesMemberus-gaap:InterestRateSwapMember2022-09-300000917251us-gaap:AccountsPayableAndAccruedLiabilitiesMemberus-gaap:InterestRateSwapMember2021-12-310000917251us-gaap:OtherAssetsMemberus-gaap:InterestRateSwapMember2022-09-300000917251us-gaap:OtherAssetsMemberus-gaap:InterestRateSwapMember2021-12-310000917251adc:May2022ForwardOfferingMember2022-07-012022-09-300000917251adc:December2021ForwardEquityMember2022-07-012022-09-300000917251adc:AtMarket2022ForwardEquityMember2022-07-012022-09-300000917251adc:AtMarket2021ForwardEquityMember2022-07-012022-09-300000917251adc:AtMarket2020ForwardEquityMember2022-07-012022-09-300000917251adc:May2022ForwardOfferingMember2022-01-012022-09-300000917251adc:December2021ForwardEquityMember2022-01-012022-09-300000917251adc:AtMarket2022ForwardEquityMember2022-01-012022-09-300000917251adc:AtMarket2021ForwardEquityMember2022-01-012022-09-300000917251adc:AtMarket2020ForwardEquityMember2022-01-012022-09-300000917251adc:May2022ForwardOfferingMember2021-07-012021-09-300000917251adc:December2021ForwardEquityMember2021-07-012021-09-300000917251adc:AtMarket2022ForwardEquityMember2021-07-012021-09-300000917251adc:AtMarket2021ForwardEquityMember2021-07-012021-09-300000917251adc:AtMarket2020ForwardEquityMember2021-07-012021-09-300000917251adc:May2022ForwardOfferingMember2021-01-012021-09-300000917251adc:December2021ForwardEquityMember2021-01-012021-09-300000917251adc:AtMarket2022ForwardEquityMember2021-01-012021-09-300000917251adc:AtMarket2021ForwardEquityMember2021-01-012021-09-300000917251adc:AtMarket2020ForwardEquityMember2021-01-012021-09-300000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberadc:AtMarketProgram2022Member2022-01-012022-09-300000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberadc:AtMarketProgram2021Member2022-01-012022-09-300000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberadc:AtMarketProgram2021Member2021-01-012021-12-310000917251srt:DirectorMemberus-gaap:RestrictedStockMember2022-09-300000917251adc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheTwoMember2022-09-300000917251adc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheOneMember2022-09-300000917251us-gaap:RestrictedStockMember2022-09-300000917251us-gaap:PreferredStockMember2022-07-012022-09-300000917251us-gaap:PreferredStockMember2022-04-012022-06-300000917251us-gaap:PreferredStockMember2022-01-012022-03-310000917251us-gaap:PreferredStockMember2021-07-012021-09-300000917251us-gaap:PreferredStockMember2022-09-300000917251us-gaap:PreferredStockMember2021-09-300000917251us-gaap:CommonStockMember2022-09-300000917251adc:AgreeLimitedPartnershipMember2022-09-300000917251us-gaap:CommonStockMember2022-06-300000917251us-gaap:CommonStockMember2022-03-310000917251us-gaap:CommonStockMember2021-09-300000917251us-gaap:CommonStockMember2021-03-310000917251us-gaap:NoncontrollingInterestMember2022-07-012022-09-300000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2022-07-012022-09-300000917251us-gaap:NoncontrollingInterestMember2022-04-012022-06-300000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2022-04-012022-06-300000917251us-gaap:NoncontrollingInterestMember2022-01-012022-03-310000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2022-01-012022-03-310000917251us-gaap:NoncontrollingInterestMember2021-07-012021-09-300000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-07-012021-09-300000917251us-gaap:NoncontrollingInterestMember2021-04-012021-06-300000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-04-012021-06-300000917251us-gaap:NoncontrollingInterestMember2021-01-012021-03-310000917251us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-01-012021-03-310000917251adc:InterestRateSwapAgreementInMayAndJuly2021Member2021-07-310000917251adc:InterestRateSwapAgreementInFebruary2021Member2021-02-280000917251adc:InterestRateSwapAgreementInDecember2020Member2020-12-310000917251adc:InterestRateSwapAgreementInAugust2020Member2020-08-310000917251us-gaap:InterestRateSwapMember2022-09-300000917251us-gaap:InterestRateSwapMember2021-12-310000917251adc:InterestRateSwapAgreementThirtyFiveMillionInOctober2019Member2019-10-012019-10-310000917251adc:InterestRateSwapAgreementSixtyFiveMillionInOctober2019Member2019-10-012019-10-310000917251adc:InterestRateSwapAgreementInDecember2018Member2018-12-012018-12-310000917251adc:InterestRateSwapAgreementInJune2016Member2016-06-012016-06-300000917251adc:InterestRateSwapAgreementInJuly2014Member2014-07-012014-07-310000917251adc:InterestRateSwapAgreementThirtyFiveMillionInOctober2019Member2019-10-310000917251adc:InterestRateSwapAgreementSixtyFiveMillionInOctober2019Member2019-10-310000917251adc:InterestRateSwapAgreementInDecember2018Member2018-12-310000917251adc:InterestRateSwapAgreementInJune2016Member2016-06-300000917251adc:InterestRateSwapAgreementInJuly2014Member2014-07-310000917251adc:NotesPayableDueJuly20266.27PercentMemberus-gaap:MortgagesMember2022-01-012022-09-300000917251adc:NotesPayableDueJuly20266.27PercentMemberus-gaap:MortgagesMember2021-01-012021-12-310000917251adc:PropertyAcquisitionMemberus-gaap:MortgagesMember2022-09-300000917251adc:NotesPayableDueDecember20293.63PercentMemberus-gaap:MortgagesMember2021-12-310000917251adc:SeniorUnsecuredPublicNotes2032Memberus-gaap:InterestRateSwapMemberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredPublicNotes2032Memberadc:BlendedAllInIncludingInterestRateSwapMemberadc:SeniorUnsecuredDebtMember2022-08-310000917251us-gaap:RevolvingCreditFacilityMemberus-gaap:FairValueInputsLevel2Memberus-gaap:LongTermDebtMember2022-09-300000917251us-gaap:RevolvingCreditFacilityMemberus-gaap:FairValueInputsLevel2Memberus-gaap:LongTermDebtMember2021-12-310000917251adc:SeniorUnsecuredPublicNotes2032Memberadc:SeniorUnsecuredDebtMember2022-08-310000917251adc:SeniorUnsecuredPublicNotes2033Memberadc:BlendedAllInIncludingInterestRateSwapMemberadc:SeniorUnsecuredDebtMember2021-05-310000917251adc:SeniorUnsecuredPublicNotes2028Memberadc:BlendedAllInIncludingInterestRateSwapMemberadc:SeniorUnsecuredDebtMember2021-05-310000917251adc:SeniorUnsecuredPublicNotes2033Memberadc:SeniorUnsecuredDebtMember2021-05-310000917251adc:SeniorUnsecuredPublicNotes2028Memberadc:SeniorUnsecuredDebtMember2021-05-310000917251adc:SeniorUnsecuredPublicNote2030Memberadc:BlendedAllInIncludingInterestRateSwapMemberadc:SeniorUnsecuredDebtMember2020-08-310000917251adc:SeniorUnsecuredPublicNote2030Memberadc:SeniorUnsecuredDebtMember2020-08-310000917251us-gaap:RevolvingCreditFacilityMemberadc:TwoThousandTwentyFourTermLoanFacilityTwoMemberadc:SeniorUnsecuredDebtMember2019-12-310000917251us-gaap:RevolvingCreditFacilityMemberadc:TwoThousandTwentyFourTermLoanFacilityOneMemberadc:SeniorUnsecuredDebtMember2019-12-310000917251us-gaap:RevolvingCreditFacilityMemberadc:SeniorUnsecuredDebtMember2019-12-310000917251adc:SeniorUnsecuredNote2031Memberadc:SeniorUnsecuredDebtMember2019-10-310000917251adc:SeniorUnsecuredNote2031Memberadc:BlendedAllInIncludingInterestRateSwapMemberadc:SeniorUnsecuredDebtMember2019-03-310000917251adc:SeniorUnsecuredNote2031Memberadc:SeniorUnsecuredDebtMember2019-03-310000917251us-gaap:FairValueInputsLevel3Memberus-gaap:LongTermDebtMemberus-gaap:MortgagesMember2022-09-300000917251us-gaap:FairValueInputsLevel2Memberus-gaap:LongTermDebtMemberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredPublicNotes2033Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredPublicNotes2032Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredPublicNotes2028Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredPublicNote2030Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredNote2031Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredNote2030Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredNote2029Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredNote2028Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredNote2027Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:SeniorUnsecuredNote2025Memberadc:SeniorUnsecuredDebtMember2022-09-300000917251adc:NotesPayableDueSeptember20235.01PercentMemberus-gaap:MortgagesMember2022-09-300000917251adc:NotesPayableDueJuly20266.27PercentMemberus-gaap:MortgagesMember2022-09-300000917251adc:NotesPayableDueJanuary20233.60PercentMemberus-gaap:MortgagesMember2022-09-300000917251adc:NotesPayableDueDecember20293.63PercentMemberus-gaap:MortgagesMember2022-09-300000917251us-gaap:RevolvingCreditFacilityMember2022-09-300000917251us-gaap:MortgagesMember2022-09-300000917251adc:SeniorUnsecuredDebtMember2022-09-300000917251us-gaap:FairValueInputsLevel3Memberus-gaap:LongTermDebtMemberus-gaap:MortgagesMember2021-12-310000917251us-gaap:FairValueInputsLevel2Memberus-gaap:LongTermDebtMemberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredPublicNotes2033Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredPublicNotes2032Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredPublicNotes2028Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredPublicNote2030Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredNote2031Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredNote2030Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredNote2029Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredNote2028Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredNote2027Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:SeniorUnsecuredNote2025Memberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:NotesPayableDueSeptember20235.01PercentMemberus-gaap:MortgagesMember2021-12-310000917251adc:NotesPayableDueJuly20266.27PercentMemberus-gaap:MortgagesMember2021-12-310000917251adc:NotesPayableDueJanuary20233.60PercentMemberus-gaap:MortgagesMember2021-12-310000917251us-gaap:MortgagesMember2021-12-310000917251adc:SeniorUnsecuredDebtMember2021-12-310000917251srt:MinimumMemberus-gaap:RevolvingCreditFacilityMemberadc:SeniorUnsecuredDebtMemberus-gaap:LondonInterbankOfferedRateLIBORMember2021-01-012021-12-310000917251srt:MaximumMemberus-gaap:RevolvingCreditFacilityMemberadc:SeniorUnsecuredDebtMemberus-gaap:LondonInterbankOfferedRateLIBORMember2021-01-012021-12-310000917251us-gaap:RevolvingCreditFacilityMemberadc:SeniorUnsecuredDebtMemberus-gaap:LondonInterbankOfferedRateLIBORMember2021-01-012021-12-310000917251us-gaap:CommonStockMemberus-gaap:SubsequentEventMemberus-gaap:OverAllotmentOptionMember2022-10-310000917251us-gaap:CommonStockMemberus-gaap:SubsequentEventMember2022-10-310000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberadc:AtMarketProgram2021Member2022-09-300000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberus-gaap:OverAllotmentOptionMember2022-05-310000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMember2022-05-310000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberus-gaap:OverAllotmentOptionMember2021-12-310000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMember2021-12-310000917251us-gaap:CommonStockMemberus-gaap:OverAllotmentOptionMember2021-06-300000917251us-gaap:CommonStockMember2021-06-300000917251us-gaap:CommonStockMemberus-gaap:OverAllotmentOptionMember2021-01-310000917251us-gaap:CommonStockMember2021-01-310000917251adc:OmnibusIncentivePlan2020Member2022-09-3000009172512021-09-3000009172512020-12-310000917251us-gaap:ForwardContractsMemberadc:AtMarketForwardEquityMember2022-07-012022-09-300000917251us-gaap:RestrictedStockMember2022-07-012022-09-300000917251us-gaap:ForwardContractsMemberadc:AtMarketForwardEquityMember2022-01-012022-09-300000917251us-gaap:RestrictedStockMember2022-01-012022-09-300000917251us-gaap:ForwardContractsMemberadc:AtMarketForwardEquityMember2021-07-012021-09-300000917251us-gaap:RestrictedStockMember2021-07-012021-09-300000917251us-gaap:ForwardContractsMemberadc:AtMarketForwardEquityMember2021-01-012021-09-300000917251us-gaap:RestrictedStockMember2021-01-012021-09-300000917251adc:LeasingCostsMember2022-07-012022-09-300000917251adc:CreditFacilityFinancingCostsMember2022-07-012022-09-300000917251adc:LeasingCostsMember2022-01-012022-09-300000917251adc:CreditFacilityFinancingCostsMember2022-01-012022-09-300000917251adc:LeasingCostsMember2021-07-012021-09-300000917251adc:CreditFacilityFinancingCostsMember2021-07-012021-09-300000917251adc:LeasingCostsMember2021-01-012021-09-300000917251adc:CreditFacilityFinancingCostsMember2021-01-012021-09-300000917251adc:BelowMarketLeasesMember2022-07-012022-09-300000917251adc:BelowMarketLeasesMember2022-01-012022-09-300000917251adc:BelowMarketLeasesMember2021-07-012021-09-300000917251adc:BelowMarketLeasesMember2021-01-012021-09-300000917251srt:DirectorMemberus-gaap:RestrictedStockMember2022-07-012022-09-300000917251adc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheTwoMember2022-07-012022-09-300000917251adc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheOneMember2022-07-012022-09-300000917251us-gaap:RestrictedStockMember2022-07-012022-09-300000917251adc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheTwoMember2022-01-012022-09-300000917251adc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheOneMember2022-01-012022-09-300000917251srt:MaximumMemberadc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheOneMember2021-07-012021-09-300000917251adc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheTwoMember2021-07-012021-09-300000917251us-gaap:RestrictedStockMember2021-07-012021-09-300000917251adc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheTwoMember2021-01-012021-09-300000917251adc:PerformanceUnitsAndSharesMemberus-gaap:ShareBasedCompensationAwardTrancheOneMember2021-01-012021-09-300000917251us-gaap:RestrictedStockMember2021-01-012021-09-300000917251us-gaap:AdditionalPaidInCapitalMember2022-07-012022-09-300000917251us-gaap:AdditionalPaidInCapitalMember2022-04-012022-06-3000009172512022-04-012022-06-300000917251us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-3100009172512022-01-012022-03-310000917251us-gaap:AdditionalPaidInCapitalMember2021-07-012021-09-300000917251us-gaap:AdditionalPaidInCapitalMember2021-04-012021-06-3000009172512021-04-012021-06-300000917251us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-3100009172512021-01-012021-03-310000917251us-gaap:UnbilledRevenuesMember2022-09-300000917251us-gaap:UnbilledRevenuesMember2021-12-310000917251us-gaap:RedeemablePreferredStockMember2022-01-012022-09-300000917251us-gaap:CommonStockMember2022-01-012022-09-3000009172512022-10-310000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberadc:AtMarketProgram2022Member2022-09-300000917251us-gaap:ForwardContractsMemberus-gaap:CommonStockMemberadc:AtMarketProgram2021Member2021-02-280000917251us-gaap:PerformanceSharesMember2022-01-012022-09-300000917251srt:MaximumMember2014-11-180000917251adc:SeniorUnsecuredPublicNotes2032Memberus-gaap:InterestRateSwapMemberadc:SeniorUnsecuredDebtMember2022-08-012022-08-310000917251adc:SeniorUnsecuredPublicNotes2033Memberus-gaap:InterestRateSwapMemberadc:SeniorUnsecuredDebtMember2021-05-012021-05-310000917251us-gaap:RedeemablePreferredStockMember2021-09-012021-09-300000917251adc:SeniorUnsecuredPublicNote2030Memberus-gaap:InterestRateSwapMemberadc:SeniorUnsecuredDebtMember2020-08-012020-08-310000917251adc:InterestRateSwapAgreementInMayAndJuly2021Member2022-08-012022-08-310000917251adc:InterestRateSwapAgreementThirtyFiveMillionInOctober2019Member2021-05-012021-05-310000917251adc:InterestRateSwapAgreementSixtyFiveMillionInOctober2019Member2021-05-012021-05-310000917251adc:InterestRateSwapAgreementInJune2016Member2021-05-012021-05-310000917251adc:InterestRateSwapAgreementInJuly2014Member2021-05-012021-05-310000917251adc:InterestRateSwapAgreementInFebruary2021Member2021-05-012021-05-310000917251adc:InterestRateSwapAgreementInDecember2020Member2021-05-012021-05-310000917251adc:InterestRateSwapAgreementInDecember2018Member2021-05-012021-05-310000917251adc:InterestRateSwapAgreementInAugust2020Member2021-05-012021-05-3100009172512021-12-310000917251adc:PropertyAcquisitionMemberus-gaap:MortgagesMember2022-01-012022-09-300000917251adc:DebtInstrumentScheduledPrincipalMember2022-09-300000917251adc:DebtInstrumentBalloonPaymentMember2022-09-300000917251adc:SeniorUnsecuredDebtMember2021-01-012021-09-300000917251adc:LeasingCostsMember2022-09-300000917251adc:CreditFacilityFinancingCostsMember2022-09-3000009172512022-07-012022-09-3000009172512021-07-012021-09-3000009172512022-09-300000917251srt:DirectorMemberus-gaap:RestrictedStockMember2022-01-012022-09-300000917251us-gaap:RestrictedStockMember2022-01-012022-09-300000917251adc:PerformanceUnitsAndSharesMember2022-01-012022-09-300000917251adc:SeniorUnsecuredPublicNotes2032Memberus-gaap:InterestRateSwapMemberadc:SeniorUnsecuredDebtMember2022-08-310000917251adc:SeniorUnsecuredPublicNotes2033Memberus-gaap:InterestRateSwapMemberadc:SeniorUnsecuredDebtMember2021-05-310000917251adc:SeniorUnsecuredPublicNote2030Memberus-gaap:InterestRateSwapMemberadc:SeniorUnsecuredDebtMember2020-08-310000917251us-gaap:RevolvingCreditFacilityMemberadc:SeniorUnsecuredDebtMember2021-12-310000917251adc:BelowMarketLeasesMember2022-09-3000009172512022-01-012022-09-3000009172512021-01-012021-09-30utr:sqftadc:DerivativeInstrumentadc:segmentiso4217:USDxbrli:pureadc:tenantadc:siteadc:propertyadc:stateiso4217:USDxbrli:sharesadc:itemxbrli:shares

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

Mark One

Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2022, or

Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period fromto

Commission File Number 001-12928

AGREE REALTY CORPORATION

(Exact name of registrant as specified in its charter)

Maryland

    

38-3148187

(State or other jurisdiction of incorporation or

(I.R.S. Employer Identification No.)

Organization)

 

70 E. Long Lake Road, Bloomfield Hills, Michigan

    

48304

(Address of principal executive offices)

(Zip Code)

(248) 737-4190

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:  

Title of Each Class

Trading Symbol(s)

Name of Each Exchange on Which Registered

Common Stock, $0.0001 par value

ADC

New York Stock Exchange

Depositary Shares, each representing one-thousandth of a share of 4.25% Series A Cumulative Redeemable Preferred Stock, $0.0001 par value

ADCPrA

New York Stock Exchange

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.

Yes

No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes

No

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

Large Accelerated Filer

Accelerated Filer

Non-accelerated Filer 

Smaller reporting company

Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

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

Yes

No

As of October 31, 2022, the Registrant had 88,573,248 shares of common stock issued and outstanding.

AGREE REALTY CORPORATION

Index to Form 10-Q

Page

PART I

Financial Information

Item 1:

Financial Statements (Unaudited)

Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021

1

Condensed Consolidated Statements of Operations and Comprehensive Income for the three and nine months ended September 30, 2022 and 2021

3

Condensed Consolidated Statements of Equity for the three and nine months ended September 30, 2022 and 2021

4

Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 and 2021

6

Notes to Condensed Consolidated Financial Statements

7

Item 2:

Management’s Discussion and Analysis of Financial Condition and Results of Operations

34

Item 3:

Quantitative and Qualitative Disclosures about Market Risk

49

Item 4:

Controls and Procedures

50

PART II

Other Information

Item 1:

Legal Proceedings

50

Item 1A:

Risk Factors

50

Item 2:

Unregistered Sales of Equity Securities and Use of Proceeds

50

Item 3:

Defaults Upon Senior Securities

50

Item 4:

Mine Safety Disclosures

50

Item 5:

Other Information

50

Item 6:

Exhibits

51

SIGNATURES

52

PART I.       FINANCIAL INFORMATION

Item 1.       Financial Statements

AGREE REALTY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per-share data)

(Unaudited)

September 30, 

December 31, 

2022

2021

ASSETS

Real Estate Investments

  

Land

$

1,841,259

$

1,559,434

Buildings

 

3,795,181

 

3,034,391

Less accumulated depreciation

 

(296,304)

 

(233,862)

 

5,340,136

 

4,359,963

Property under development

 

50,685

 

7,148

Net Real Estate Investments

 

5,390,821

 

4,367,111

 

  

Real Estate Held for Sale, net

 

 

5,676

 

Cash and Cash Equivalents

 

250,487

 

43,252

 

  

Cash Held in Escrows

 

1,027

 

1,998

Accounts Receivable - Tenants, net

68,697

 

53,442

 

  

Lease Intangibles, net of accumulated amortization of

$240,244 and $180,532 at September 30, 2022 and December 31, 2021, respectively

 

763,458

 

672,020

 

Other Assets, net

 

81,611

 

83,407

 

  

Total Assets

$

6,556,101

$

5,226,906

See accompanying notes to Condensed Consolidated Financial Statements.

1

AGREE REALTY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per-share data)

(Unaudited)

September 30, 

December 31, 

2022

2021

LIABILITIES

  

Mortgage Notes Payable, net

$

71,721

$

32,429

  

Senior Unsecured Notes, net

1,791,492

 

1,495,200

  

Unsecured Revolving Credit Facility

 

160,000

  

Dividends and Distributions Payable

21,427

 

16,881

Accounts Payable, Accrued Expenses, and Other Liabilities

85,637

 

70,005

  

Lease Intangibles, net of accumulated amortization of

$34,356 and $29,726 at September 30, 2022 and December 31, 2021, respectively

37,117

 

33,075

  

Total Liabilities

2,007,394

 

1,807,590

  

EQUITY

  

Preferred stock, $.0001 par value per share, 4,000,000 shares authorized, 7,000 shares Series A outstanding, at stated liquidation value of $25,000 per share, at September 30, 2022 and December 31, 2021

175,000

 

175,000

Common stock, $.0001 par value, 180,000,000 shares authorized, 88,573,248 and 71,285,311 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively

9

7

Additional paid-in-capital

4,551,081

 

3,395,549

Dividends in excess of net income

(203,040)

 

(147,366)

Accumulated other comprehensive income (loss)

24,124

 

(5,503)

  

Total Equity - Agree Realty Corporation

4,547,174

 

3,417,687

Non-controlling interest

1,533

 

1,629

Total Equity

4,548,707

 

3,419,316

  

Total Liabilities and Equity

$

6,556,101

$

5,226,906

See accompanying notes to Condensed Consolidated Financial Statements.

2

AGREE REALTY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(In thousands, except share and per-share data)

(Unaudited)

Three Months Ended

Nine Months Ended

    

September 30, 2022

    

September 30, 2021

    

September 30, 2022

    

September 30, 2021

Revenues

 

  

 

  

 

  

 

  

Rental income

$

110,031

$

87,469

$

313,136

$

247,722

Other

 

34

 

68

 

147

 

189

Total Revenues

 

110,065

 

87,537

 

313,283

 

247,911

 

  

 

  

 

  

 

  

Operating Expenses

 

  

 

  

 

  

 

  

Real estate taxes

 

8,526

 

6,957

 

24,117

 

18,812

Property operating expenses

 

4,557

 

3,189

 

13,575

 

9,944

Land lease expense

 

404

 

400

 

1,213

 

1,135

General and administrative

 

6,992

 

5,687

 

22,265

 

18,806

Depreciation and amortization

 

35,157

 

24,488

 

95,666

 

69,164

Provision for impairment

 

 

 

1,015

 

Total Operating Expenses

 

55,636

 

40,721

 

157,851

 

117,861

Gain (loss) on sale of assets, net

 

3,000

 

3,470

 

5,326

 

13,182

Gain (loss) on involuntary conversion, net

(115)

(165)

103

Income from Operations

 

57,314

 

50,286

 

160,593

 

143,335

 

  

 

  

 

  

 

  

Other (Expense) Income

 

  

 

  

 

  

 

  

Interest expense, net

 

(17,149)

 

(13,066)

 

(46,592)

 

(37,267)

Income tax (expense) benefit

(720)

(390)

(2,137)

(1,884)

Loss on early extinguishment of term loans and settlement of related interest rate swaps

(14,614)

Other (expense) income

 

132

 

 

132

 

Net Income

 

39,577

 

36,830

 

111,996

 

89,570

 

  

 

  

 

  

 

  

Less net income attributable to non-controlling interest

 

152

 

167

 

485

 

447

Net income attributable to Agree Realty Corporation

39,425

36,663

111,511

89,123

Less Series A preferred stock dividends

 

1,859

 

289

 

5,578

 

289

Net Income Attributable to Common Stockholders

$

37,566

$

36,374

$

105,933

$

88,834

 

  

 

  

 

  

 

  

Net Income Per Share Attributable to Common Stockholders

 

  

 

  

 

  

 

  

Basic

$

0.47

$

0.52

$

1.40

$

1.35

Diluted

$

0.46

$

0.52

$

1.39

$

1.34

 

  

 

  

 

  

 

  

Other Comprehensive Income

 

  

 

  

 

  

 

  

Net income

$

39,577

$

36,830

$

111,996

$

89,570

Amortization of interest rate swaps

(273)

82

(109)

869

Change in fair value and settlement of interest rate swaps

 

(7,181)

 

3,300

 

29,881

 

30,676

Total comprehensive income (loss)

 

32,123

 

40,212

 

141,768

 

121,115

Less comprehensive income (loss) attributable to non-controlling interest

 

121

 

185

 

630

 

465

 

  

 

  

 

  

 

  

Comprehensive Income (Loss) Attributable to Agree Realty Corporation

$

32,002

$

40,027

$

141,138

$

120,650

 

  

 

  

 

  

 

  

Weighted Average Number of Common Shares Outstanding - Basic

 

79,701,136

 

69,102,500

 

75,361,583

 

65,623,720

 

  

 

  

 

  

 

  

Weighted Average Number of Common Shares Outstanding - Diluted

 

80,589,446

 

69,591,848

 

75,890,692

 

65,952,113

See accompanying notes to Condensed Consolidated Financial Statements.

3

AGREE REALTY CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF EQUITY

(In thousands, except share and per-share data)

(Unaudited)

Accumulated

Dividends in

Other

Preferred Stock

Common Stock

Additional

excess of net

Comprehensive

Non-Controlling

Total

  

Shares

  

Amount

  

Shares

  

Amount

  

Paid-In Capital

  

income

  

Income (Loss)

  

Interest

  

Equity

Balance, December 31, 2021

7,000

$

175,000

71,285,311

$

7

$

3,395,549

$

(147,366)

$

(5,503)

$

1,629

$

3,419,316

Issuance of common stock, net of issuance costs

3,791,964

1

250,683

250,684

Repurchase of common shares

(28,117)

(1,745)

(1,745)

Issuance of stock under the 2020 Omnibus Incentive Plan

125,422

648

648

Stock-based compensation

1,635

1,635

Series A preferred dividends declared for the period

(1,859)

(1,859)

Dividends and distributions declared for the period

(49,653)

(237)

(49,890)

Amortization, changes in fair value, and settlement of interest rate swaps

20,563

100

20,663

Net income

1,859

34,254

176

36,289

Balance, March 31, 2022

7,000

$

175,000

75,174,580

$

8

$

3,646,770

$

(162,765)

$

15,060

$

1,668

$

3,675,741

Issuance of common stock, net of issuance costs

4,667,850

300,110

300,110

Repurchase of common shares

(1,052)

(76)

(76)

Issuance of stock under the 2020 Omnibus Incentive Plan

1,493

Forfeiture of restricted stock

(128)

Stock-based compensation

1,743

1,743

Series A preferred dividends declared for the period

(1,859)

(1,859)

Dividends and distributions declared for the period

(53,867)

(245)

(54,112)

Amortization, changes in fair value, and settlement of interest rate swaps

16,487

76

16,563

Net income

1,859

34,114

157

36,130

Balance, June 30, 2022

7,000

$

175,000

79,842,743

$

8

$

3,948,547

$

(182,518)

$

31,547

$

1,656

$

3,974,240

Issuance of common stock, net of issuance costs

8,739,752

1

601,086

601,087

Repurchase of common shares

(943)

(66)

(66)

Issuance of stock under the 2020 Omnibus Incentive Plan

1,754

Forfeiture of restricted stock

(10,058)

(61)

(61)

Stock-based compensation

1,575

1,575

Series A preferred dividends declared for the period

(1,859)

(1,859)

Dividends and distributions declared for the period

(58,088)

(244)

(58,332)

Amortization, changes in fair value, and settlement of interest rate swaps

(7,423)

(31)

(7,454)

Net income

1,859

37,566

152

39,577

Balance, September 30, 2022

7,000

$

175,000

88,573,248

$

9

$

4,551,081

$

(203,040)

$

24,124

$

1,533

$

4,548,707

Cash dividends declared per depositary share of Series A preferred stock:

For the three months ended March 31, 2022

$

0.266

For the three months ended June 30, 2022

$

0.266

For the three months ended September 30, 2022

$

0.266

Cash dividends declared per common share:

For the three months ended March 31, 2022

$

0.681

For the three months ended June 30, 2022

$

0.702

For the three months ended September 30, 2022

$

0.702

See accompanying notes to Condensed Consolidated Financial Statements.

4

AGREE REALTY CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF EQUITY

(In thousands, except share and per-share data)

(Unaudited)

Accumulated

Dividends in

Other

Preferred Stock

Common Stock

Additional

excess of net

Comprehensive

Non-Controlling

Total

  

Shares

  

Amount

  

Shares

  

Amount

  

Paid-In Capital

  

income

  

Income (Loss)

  

Interest

  

Equity

Balance, December 31, 2020

$

60,021,483

$

6

$

2,652,090

$

(91,343)

$

(36,266)

$

1,762

$

2,526,249

Issuance of common stock, net of issuance costs

&#