Alpine Income Property Trust, Inc. (NYSE:PINE) Q3 2023 Earnings Conference Call October 20, 2023 9:00 AM ET

Company Participants

Matthew Partridge - Senior Vice President, Chief Financial Officer and Treasurer

John Albright - President and Chief Executive Officer

Conference Call Participants

Matthew Erdner - JonesTrading

Robert Stevenson - Janney Montgomery Scott

Wesley Golladay - Baird

RJ Milligan - Raymond James

Operator

Good day and thank you for standing by. Welcome to the Alpine Q3 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Matt Partridge, Chief Financial Officer.

Matthew Partridge

Good morning, everyone, and thank you for joining us today for the Alpine Income Property Trust Third Quarter 2023 Operating Results Conference Call. With me today is our CEO and President, John Albright.

Before we begin, I'd like to remind everyone that many of our comments today are considered forward-looking statements under federal securities law. The company's actual future results may differ significantly from the matters discussed in these forward-looking statements and we undertake no duty to update these statements.

Factors and risks that could cause actual results to differ materially from expectations are disclosed from time to time in greater detail in the company's Form 10-K, Form 10-Q and other SEC filings. You can find our SEC reports, earnings release and most recent investor presentation, which contain reconciliations of non-GAAP financial measures we use on our website at alpinereit.com.

I'll now hand the call over to John for his prepared remarks.

John Albright

Thanks, Matt, and good morning, everyone. Jumping right in, investments during the quarter totaled $27.2 million, made up of $19.4 million of net lease acquisitions and a $7.8 million loan investment. Dispositions during the quarter totaled $20.6 million.

During the quarter, the cash cap rate on our acquisitions was 9%. The initial yield on our loan investment was 8.5% and the exit cap rate on our dispositions was 6.3%. Contributing to our outsized acquisition yield is the Kohl's we purchased in Chandler, Arizona. This property is set to have its rent rolled down 25% in the first quarter of 2024.

The roll down was negotiated prior to our purchase in order to meaningfully extend the term of the property. The acquisition cap rate on our Q3 activity post rent reset is 7.5%, which is the second highest cap rate for quarterly acquisition volume in our company's history and more than 50 basis points above our historical average.