# NETSTREIT Corp.

> Clarifo company profile — qualitative business description generated from
> the company's filings. Financial statements, charts and ratios are
> available on Clarifo (https://www.clarifo.com/fi/companies/NETSTREIT Corp.).

## Overview

NETSTREIT Corp. is an internally managed U.S. REIT that acquires, owns, and manages single-tenant retail properties leased on a long-term net basis to creditworthy tenants. Its portfolio is built around necessity-based and e-commerce-resistant retail formats such as grocers, convenience stores, discount stores, home improvement, quick-service restaurants, general retail, and auto parts.

## Products & services

• Acquisition and ownership of single-tenant net lease retail properties
• Long-term triple-net lease portfolio management
• Build-to-suit development partnerships
• Mortgage loans secured by real estate
• Property sales and portfolio recycling

- **Net lease retail properties** (88%) — Single-tenant commercial retail properties leased on a long-term net basis to tenants.
- **Mortgage loans receivable** (7%) — Loans secured by real estate that generate interest income alongside rental revenue.
- **Property development** (3%) — Build-to-suit and development projects where rent has not yet commenced or is under construction.
- **Property dispositions** (2%) — Sales of real estate assets used to recycle capital and manage portfolio quality.

- Acquisition and ownership of single-tenant net lease retail properties
- Long-term triple-net lease portfolio management
- Build-to-suit development partnerships
- Mortgage loans secured by real estate
- Property sales and portfolio recycling

## Customers

NETSTREIT’s tenants are retail operators that need physical locations to drive sales, especially in necessity and essential-service categories. The company emphasizes high-credit-quality and investment-grade tenants, but also leases to creditworthy non-investment-grade operators where it sees attractive risk-adjusted returns.

- **Necessity retail tenants** (primary) — Grocers, convenience stores, and discount retailers that buy long-term store locations because they are resilient through cycles.
- **Essential service and defensive retail tenants** (primary) — Quick-service restaurants, auto parts, and home improvement operators that need physical sites to support recurring demand.
- **Investment-grade tenants** (primary) — Tenants with strong credit profiles that support lower lease risk and more stable cash flows.
- **Creditworthy non-investment-grade tenants** (secondary) — Operators without formal investment-grade ratings that still fit the company’s underwriting and yield targets.

- Grocers and convenience stores that rely on local foot traffic
- Discount stores and general retail chains needing stable sites
- Home improvement and auto parts tenants with durable demand
- Quick-service restaurants seeking long-term, high-traffic locations
- Investment-grade and creditworthy tenants that support lease durability

## Geography

NETSTREIT operates almost entirely in the United States and had investments in 45 states as of year-end 2025. The portfolio is concentrated in the South and Midwest, with Texas, Illinois, New York, Georgia, Wisconsin, and North Carolina representing the largest state exposures by ABR, which makes regional economic and weather-related disruptions important to monitor.

- **Texas** (17.3%) — Largest state exposure by ABR
- **Illinois** (8.3%)
- **New York** (6.9%)
- **Georgia** (5%)
- **Wisconsin** (4.9%)
- **North Carolina** (4%)
- **South** (49.5%)
- **Midwest** (28%)

- United States is the only operating geography disclosed
- Portfolio spans 45 states, supporting diversification
- Texas is the largest state exposure at 17.3% of ABR
- South and Midwest account for 49.5% and 28.0% of ABR
- State concentration can amplify local tax, labor, and disaster risk

## Strategy

NETSTREIT’s strategy is to keep scaling a diversified net-lease portfolio by sourcing marketed and off-market deals through long-standing industry relationships. It also uses build-to-suit partnerships and selective mortgage lending to improve yields and broaden capital deployment options while maintaining REIT discipline.

- **Scale the net-lease portfolio through disciplined acquisitions** (short-term) — Growth depends on efficiently deploying capital into durable assets with long lease terms and creditworthy tenants.
- **Increase diversification while controlling concentration** (medium-term) — Tenant, sector, and state concentration can materially affect cash flow if a large tenant or region weakens.
- **Use build-to-suit and mortgage investments to enhance returns** (medium-term) — These structures can provide higher yields and broaden the company’s investment toolkit beyond plain-vanilla acquisitions.

- Use relationship-based sourcing to access marketed and off-market deals
- Expand the portfolio with long-term leases to resilient retail tenants
- Pursue build-to-suit projects that can offer higher yields
- Recycle capital through property sales and selective dispositions
- Maintain diversification limits across tenants, sectors, and states

## Risks

The main risks come from tenant credit, geographic concentration, and the sensitivity of net-lease cash flows to interest rates and capital markets access. Because the portfolio is concentrated in defensive retail and in certain states, a regional downturn, tenant failure, or property damage event could affect occupancy, rent collection, and asset values.

- **Tenant concentration** [high] — A small number of tenants can represent a meaningful share of ABR, so one tenant problem can reduce rent and occupancy.
- **Geographic concentration** [high] — A large share of ABR is concentrated in Texas, the South, and the Midwest, increasing exposure to regional shocks.
- **Interest rate and financing risk** [high] — The business uses debt to fund acquisitions, so higher borrowing costs can compress returns and reduce acquisition capacity.
- **Property damage and insurance coverage** [medium] — Physical retail assets can suffer losses from fires, floods, foundation issues, or other damage, and insurance may not fully cover them.
- **Cybersecurity and third-party dependence** [medium] — The company relies on vendors and systems to process and store data, creating operational and data-security exposure.

- Tenant concentration can hurt cash flow if a large tenant weakens
- State and regional concentration increases exposure to local downturns
- Interest expense and refinancing risk rise when rates or spreads increase
- Property damage, insurance gaps, and natural disasters can create losses
- Cybersecurity and third-party service risks can disrupt operations

## Accounting

The most important accounting judgments are lease revenue recognition, straight-line rent, and impairment testing on real estate assets and mortgage loans. Because the company also sells properties and invests in mortgage loans, gains, losses, and interest income can shift materially with transaction timing and valuation assumptions.

- **Straight-line rental revenue** — Affects reported rental revenue and receivables
- **Impairment of real estate and loans** — Can materially reduce earnings in periods of weaker asset performance
- **Gain on sales of real estate** — Can swing quarterly and annual net income
- **Depreciation and amortization** — Affects operating profit and comparability across periods

- Straight-line rent affects timing of rental revenue recognition
- Property and loan impairment provisions can move earnings materially
- Real estate sales create gains or losses based on transaction timing
- Depreciation and amortization are significant due to property ownership
- Debt issuance costs and extinguishment losses affect interest expense

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*Last updated: 2026-04-28T20:28:33.792894+00:00*