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Press Release

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Contact:Matthew M. Partridge

Senior Vice President, Chief Financial Officer & Treasurer

(407) 904-3324

mpartridge@alpinereit.com

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WINTER PARK, FL – October 20, 2022 – Alpine Income Property Trust, Inc. (NYSE: PINE) (the “Company” or “PINE”) today announced its operating results and earnings for the quarter ended September 30, 2022.

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Select Highlights

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CEO Comments

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“This was another solid quarter of consistent execution from our team as we continue to find opportunities to deliver attractive net investment spreads, improve earnings growth, and enhance the overall quality of our 100% occupied, retail net lease portfolio,” said John P. Albright, President and Chief Executive Officer of Alpine Income Property Trust. “With our newly expanded and extended $250 million revolving credit facility, we have no debt maturing until 2026, minimal floating interest rate exposure, and ample liquidity as we look to be opportunistic in a quickly evolving transaction market. As we continue to focus on capital recycling, we expect to accretively match fund our acquisitions through the end of the year with disposition proceeds as we target high-quality tenants with strong operations in well-performing retail sectors.”

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Quarterly Operating Results Highlights

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The table below provides a summary of the Company’s operating results for the quarter ended September 30, 2022 (in thousands, except per share data):

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Year-to-Date Operating Results Highlights

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The table below provides a summary of the Company’s operating results for the nine months ended September 30, 2022 (in thousands, except per share data):

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Acquisitions

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During the three months ended September 30, 2022, the Company acquired nine high-quality retail net lease properties for total acquisition volume of $36.7 million, reflecting a weighted average going-in cash cap rate of 7.1%. As of the acquisition date, the properties had a weighted average remaining lease term of 7.5 years, were located in eight states, and were leased to tenants operating in four retail sectors, including the home improvement, home furnishings, dollar stores, and sporting goods industries. More than 75% of annualized cash base rents acquired are generated from a tenant or the parent of a tenant with an investment grade credit rating.

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During the nine months ended September 30, 2022, the Company acquired 44 net lease properties for total acquisition volume of $145.7 million, reflecting a weighted average going-in cash cap rate of 7.0%. As of the acquisition date, the properties had a weighted average remaining lease term of 8.9 years and were located in 21 states. Approximately 70% of annualized cash base rents acquired are generated from a tenant or the parent of a tenant with an investment grade credit rating.

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Dispositions

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During the three months ended September 30, 2022, the Company sold six net lease properties for total disposition volume of $50.5 million, representing a weighted average exit cash cap rate of 5.5%. The sale of the properties generated total gains of $11.6 million. The properties were leased to Scrubbles Car Wash, Container Store, 7-Eleven, Kohl’s, and JOANN Fabric.

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During the nine months ended September 30, 2022, the Company sold 11 net lease properties, including its sole remaining office property located in Hillsboro, Oregon, for total disposition volume of $123.3 million, representing a weighted average exit cash cap rate of 6.5%. The sale of the properties generated total gains of $27.2 million. Excluding the office property disposition, the properties were sold at a weighted average exit cap rate of 5.6%.

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Property Portfolio

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The Company’s portfolio consisted of the following as of September 30, 2022:

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Any differences a result of rounding.

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The Company’s portfolio included the following top tenants that represent 2.0% or greater of the Company's total annualized base rent as of September 30, 2022:

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Any differences a result of rounding.

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The Company’s portfolio consisted of the following industries as of September 30, 2022:

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Any differences a result of rounding.

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The Company’s portfolio included properties in the following states as of September 30, 2022:

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Any differences a result of rounding.

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Capital Markets and Balance Sheet

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During the quarter ended September 30, 2022, the Company completed the following notable capital markets activities:

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The following table provides a summary of the Company’s long-term debt as of September 30, 2022:

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As of September 30, 2022, the Company held an 87.5% interest in Alpine Income Property OP, LP, the Company’s operating partnership (the “Operating Partnership” or “OP”).  There were 1,703,494 OP Units held by third parties outstanding and 11,911,662 shares of the Company’s common stock outstanding, for total outstanding common stock and OP Units held by third parties of 13,615,156, as of September 30, 2022.

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As of September 30, 2022, the Company’s net debt to Pro Forma EBITDA was 8.3 times, and as defined in the Company’s credit agreement, the Company’s fixed charge coverage ratio was 4.4 times. As of September 30, 2022, the Company’s net debt to total enterprise value was 55.2%. The Company calculates total enterprise value as the

sum of net debt and the market value of the Company's outstanding common shares and OP Units, as if the OP Units have been converted to common shares.

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Dividend

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On August 22, 2022, the Company announced a $0.275 per share common stock cash dividend for the third quarter of 2022, payable on September 30, 2022 to stockholders of record as of the close of business on September 12, 2022. The third quarter 2022 cash dividend represents a 7.8% increase over the comparable prior year period quarterly common stock cash dividend and a payout ratio of 68.8% and 65.5% of the Company’s third quarter 2022 FFO per diluted share and AFFO per diluted share, respectively.

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2022 Outlook

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The Company has increased its per share earnings outlook for 2022 to take into account the Company’s year-to-date performance and revised expectations regarding the Company’s investment activities, forecasted capital markets transactions, and other significant assumptions.  

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The Company’s increased outlook for 2022 is as follows:

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Earnings Conference Call & Webcast

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The Company will host a conference call to present its operating results for the quarter ended September 30, 2022 on Friday, October 21, 2022, at 9:00 AM ET.

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A live webcast of the call will be available on the Investor Relations page of the Company’s website at www.alpinereit.com or at the link provided in the event details below. To access the call by phone, please go to the link provided in the event details below and you will be provided with dial-in details.

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Webcast:https://edge.media-server.com/mmc/p/yi9b88dx 

Dial-In:https://register.vevent.com/register/BI9047aacc7c5140259934be90261b1e14 

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We encourage participants to dial into the conference call at least fifteen minutes ahead of the scheduled start time. A replay of the earnings call will be archived and available online through the Investor Relations section of the Company’s website at www.alpinereit.com.

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About Alpine Income Property Trust, Inc.

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Alpine Income Property Trust, Inc. (NYSE: PINE) is a publicly traded real estate investment trust that acquires, owns and operates a portfolio of high-quality net leased commercial properties.

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We encourage you to review our most recent investor presentation which is available on our website at http://www.alpinereit.com.

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Safe Harbor

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This press release may contain “forward-looking statements.” Forward-looking statements include statements that may be identified by words such as “could,” “may,” “might,” “will,” “likely,” “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “continues,” “projects” and similar references to future periods, or by the inclusion of forecasts or projections. Forward-looking statements are based on the Company’s current expectations and assumptions regarding capital market conditions, the Company’s business, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, the Company’s actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include general business and economic conditions, continued volatility and uncertainty in the credit markets and broader financial markets, risks inherent in the real estate business, including tenant defaults, potential liability relating to environmental matters, illiquidity of real estate investments and potential damages from natural disasters, the impact of epidemics or pandemics (such as the COVID-19 Pandemic and its variants) on the Company’s business and the business of its tenants and the impact of such epidemics or pandemics on the U.S. economy and market conditions generally, other factors affecting the Company’s business or the business of its tenants that are beyond the control of the Company or its tenants, and the factors set forth under “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and other risks and uncertainties discussed from time to time in the Company’s filings with the U.S. Securities and Exchange Commission. Any forward-looking statement made in this press release speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

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Non-GAAP Financial Measures

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Our reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). We also disclose Funds From Operations (“FFO”) Adjusted Funds From Operations (“AFFO”), and Pro Forma Earnings Before Interest, Taxes, Depreciation and Amortization (“Pro Forma EBITDA”), all of which are non-GAAP financial measures. We believe these non-GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs.

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FFO, AFFO, and Pro Forma EBITDA do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operations as reported on our statement of cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures.

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We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. NAREIT defines FFO as GAAP net income or loss adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries.

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To derive AFFO, we modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to non-cash revenues and expenses such as loss on extinguishment of debt, amortization of above- and below-market lease related intangibles, straight-line rental revenue, amortization of deferred financing costs, non-cash compensation, and other non-cash income or expense. Such items may cause short-term fluctuations in net income but have no impact on operating cash flows or long-term operating performance. We use AFFO as one measure of our performance when we formulate corporate goals.

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To derive Pro Forma EBITDA, GAAP net income or loss is adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries, non-cash revenues and expenses such as straight-line rental revenue, amortization of deferred financing costs, loss on extinguishment of debt, above- and below-market lease related intangibles, non-cash compensation, and other non-cash income or expense. Cash interest expense is also excluded from Pro Forma EBITDA, and GAAP net income or loss is adjusted for the annualized impact of acquisitions, dispositions and other similar activities.

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FFO is used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers primarily because it excludes the effect of real estate depreciation and amortization and net gains or losses on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. We believe that AFFO is an additional useful supplemental measure for investors to consider because it will help them to better assess our operating performance without the distortions created by other non-cash revenues or expenses. We also believe that Pro Forma EBITDA is an additional useful supplemental measure for investors to consider as it allows for a better assessment of our operating performance without the distortions created by other non-cash revenues, expenses or certain effects of the Company’s capital structure on our operating performance. FFO, AFFO, and Pro Forma EBITDA may not be comparable to similarly titled measures employed by other companies.

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Alpine Income Property Trust, Inc.

Consolidated Balance Sheets

(In thousands, except share and per share data) 

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Alpine Income Property Trust, Inc.

Consolidated Statements of Operations

(Unaudited)

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

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Alpine Income Property Trust, Inc.

Non-GAAP Financial Measures

Funds From Operations and Adjusted Funds From Operations

(Unaudited)

(In thousands, except per share data) 

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Alpine Income Property Trust, Inc.

Non-GAAP Financial Measures

Reconciliation of Net Debt to Pro Forma EBITDA

(Unaudited)

(In thousands) 

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