European investments dominated the quarter at about $1 billion (72% of volume), yielding an initial cash yield of 8%, and Europe now accounts for roughly $16 billion in gross asset value and 18% of annualized base rent.

Realty Income posted third-quarter 2025 investment activity of $1.4 billion at a 7.7% initial cash yield, with year-to-date investments surpassing $3.9 billion, topping full-year 2024 activity (excluding Spirit merger).

The company is leveraging AI analytics and tools (Predictive Analytics and PredictAP) to improve underwriting, asset management, and back-office efficiency, anticipating a shift of labor toward higher-value tasks.

Credit metrics show net debt to pro forma EBITDA at 5.4x, fixed charge coverage at 4.6x, liquidity of $3.5 billion, and only 6.5% of debt in variable-rate structures (revolver and CP programs).

Strategic actions include launching a perpetual-life private fund to broaden capital formation, ongoing portfolio recycling to optimize returns, with a continued emphasis on Europe for risk-adjusted returns while keeping U.S. activity selective.

Q3 included lease termination income of about $27.3 million (~$0.03 per share) from one tenant, and 2025 guidance was raised to roughly $5.5 billion in investment volume with AFFO per share guidance of $4.25–$4.27 (midpoint unchanged).

The portfolio now comprises over 15,100 properties across 92 industries for 1,600+ clients, with 98.7% occupancy and a rent recapture rate of 103.5% across 284 leases, delivering $71 million in new cash rents; 140 properties were sold for $215 million net proceeds, including 18 convenience stores at a 5.5% cap rate and an average remaining lease term of 11.3 years.

Key management notes momentum in the U.S. is starting to appear, with low exposure to variable-rate debt at 6.5%, and a disciplined approach to capital allocation and non-dilutive investments.

The company remains focused on long-duration income and private capital participation, with credit investments in Europe yielding attractive returns and expansion expected through sale-leaseback opportunities, while data center opportunities are growing in the U.S. and Europe.

In unsecured debt, an $800 million dual-tranche offering post-quarter-end carried a 4.4% yield and was mainly used to repay $550 million of 4.6% notes, with ahead-of-period forward equity around $1 billion to fund 2025 needs.

U.S. investments totaled $380 million at a 7% yield, reflecting a selective deployment approach amid moderated domestic volumes.