Essential Properties Realty Trust, Inc. Announces Public Offering of Common Stock
MWN-AI** Summary
Essential Properties Realty Trust, Inc. (NYSE: EPRT) announced its initiation of a public offering of 9,500,000 shares of common stock, in tandem with forward sale agreements with several financial institutions, including BofA Securities, Mizuho, Truist Securities, and Wells Fargo Securities. This share offering aims to facilitate the Company’s operations and potential future investments, although the Company will not directly receive any proceeds from the sale of these shares by the forward purchasers.
The offering includes a 30-day option for underwriters to purchase an additional 1,425,000 shares of common stock. Should this option be exercised, the Company plans to enter further forward sale agreements accordingly. Notably, the forward purchasers may not be obliged to borrow and sell shares under certain conditions, including high borrowing costs or inability to meet specified requirements.
The Company is structured to sell the shares at a physical settlement within approximately 24 months from the prospectus supplement's date. Proceeds from any forward sale agreements will be directed to the Company's operating partnership, contributing to corporate purposes and investments.
This public offering is issued under the Company’s effective shelf registration statement with the Securities and Exchange Commission (SEC), with relevant prospectus documents available through participating institutions or the SEC’s EDGAR database.
While the release contains forward-looking statements, it emphasizes the inherent risks and uncertainties associated with such projections. Essential Properties Realty Trust, an internally managed REIT, primarily invests in single-tenant properties on long-term net leases, showcasing a robust portfolio across diverse business concepts. The Company's lease structure reflects strong financial stability, evidenced by a weighted average rent coverage ratio of 3.6x and high occupancy rates as of the end of 2025.
MWN-AI** Analysis
Essential Properties Realty Trust, Inc. (NYSE: EPRT) recently announced a public offering of 9.5 million shares, with the potential for an additional 1.425 million shares depending on underwriter options. This offering is conducted through forward sale agreements, allowing the company to raise capital without immediate dilution of existing shares. Investors should consider several factors while assessing this offering and its implications for the stock.
Firstly, the REIT's focus on single-tenant net-leased properties servicing essential, experience-based businesses positions it well within a resilient sector, especially in today’s economy where such businesses are stable. With a 99.7% lease rate and a solid rent coverage ratio of 3.6x, EPRT demonstrates robust operational fundamentals. However, the public offering could introduce volatility in share pricing, especially in the short term, as new shares flood the market.
Investors should evaluate the intended use of proceeds from this offering. The company plans to contribute net proceeds to its operating partnership for general corporate purposes and potential investments. While these investments may enhance long-term growth, it is essential to monitor how effectively these funds will be utilized.
Additionally, the fact that EPRT will not receive immediate proceeds from stock sold via forward purchasers raises concerns about cash flow stability until the forward sale agreements are settled. This could impact investor sentiment.
While the forward-looking statements in the announcement indicate optimistic management intentions, the inherent risks associated with market conditions and operational execution should temper expectations. Potential investors may find an entry point during the offering price fluctuation, but caution is advised given the current uncertainty inherent in equity markets. A balanced approach, weighing the REIT's growth prospects against potential short-term volatility, will serve investors well as they navigate EPRT's stock.
**MWN-AI Summary and Analysis is based on asking OpenAI to summarize and analyze this news release.
Essential Properties Realty Trust, Inc. (NYSE: EPRT; the “Company”) announced today that it has commenced an underwritten public offering of 9,500,000 shares of its common stock on a forward basis in connection with the forward sale agreements described below.
BofA Securities, Mizuho, Truist Securities and Wells Fargo Securities are acting as the joint book-running managers for the offering.
In connection with the offering, the Company expects to enter into forward sale agreements with BofA Securities, Mizuho, Truist Securities and Wells Fargo Securities (or affiliates thereof) (the “forward purchasers”), with respect to 9,500,000 shares of the Company’s common stock.
The underwriters expect to be granted a 30-day option, exercisable in whole or in part from time to time, to purchase up to an additional 1,425,000 shares of the Company’s common stock. If the option to purchase additional shares of the Company’s common stock is exercised, the Company expects to enter into one or more additional forward sale agreements with the forward purchasers in respect of the number of shares of the Company’s common stock that are subject to exercise of the option to purchase additional shares.
In connection with the forward sale agreements and any additional forward sale agreements, the forward purchasers (or their affiliates) are expected to borrow from third parties and sell to the underwriters an aggregate of 9,500,000 shares of the Company’s common stock (or an aggregate of 10,925,000 shares of the Company’s common stock if the underwriters’ option to purchase additional shares is exercised in full). However, a forward purchaser (or its affiliate) is not required to borrow and sell such shares if, after using commercially reasonable efforts, such forward purchaser (or its affiliate) is unable to borrow such shares, or if borrowing costs exceed a specified threshold or if certain specified conditions have not been satisfied. If a forward purchaser (or its affiliate) does not deliver and sell all of the shares of the Company’s common stock to be sold by it to the underwriters, the Company will issue and sell to the underwriters a number of shares of its common stock equal to the number of shares that such forward purchaser (or its affiliate) did not deliver and sell, and the number of shares underlying the relevant forward sale agreement or such additional forward sale agreement will be decreased by the number of shares that the Company issues and sells.
Pursuant to the terms of the forward sale agreements and any additional forward sale agreements, and subject to its right to elect cash or net share settlement, the Company intends to issue and sell, upon physical settlement of the forward sale agreements and any additional forward sale agreements, an aggregate of 9,500,000 shares of common stock (or an aggregate of up to 10,925,000 shares of common stock if the underwriters’ option to purchase additional shares is exercised in full) to the forward purchasers. The Company expects to physically settle the forward sale agreements and any additional forward sale agreements within approximately 24 months from the date of the prospectus supplement relating to the offering.
The Company will not receive any proceeds from the sale of shares of its common stock by the forward purchasers (or affiliates thereof). The Company intends to contribute any net proceeds from the settlement of the forward sale agreements to the Company’s operating partnership in exchange for OP Units, and the operating partnership intends to use such net proceeds for general corporate purposes, including potential future investments.
All of the shares of common stock will be offered pursuant to the Company’s effective shelf registration statement filed with the Securities and Exchange Commission (the “SEC”). A preliminary prospectus supplement and accompanying prospectus relating to the offering will be filed with the SEC. When available, a copy of the preliminary prospectus supplement and accompanying prospectus relating to the offering may be obtained from BofA Securities, Inc., NC1-022-02-25, 201 North Tryon Street, Charlotte, NC 28255-0001, Attn: Prospectus Department, Email: dg.prospectus_requests@bofa.com ; Mizuho Securities USA LLC, 1271 Avenue of the Americas, 3rd Floor, New York, New York 10020, Attention: Equity Capital Markets or by email at US-ECM@mizuhogroup.com ; Truist Securities, Inc., 740 Battery Ave SE, 3rd Floor, Atlanta, GA 30339, Attn: Equity Capital Markets or by email at TruistSecurities.prospectus@Truist.com ; or Wells Fargo Securities, 90 South 7th Street, 5th Floor, Minneapolis, MN 55402, at 800-645-3751 (option #5) or email a request to WFScustomerservice@wellsfargo.com , or by visiting the EDGAR database on the SEC’s web site at www.sec.gov .
This press release does not constitute an offer to sell or the solicitation of an offer to buy nor will there be any sale of these securities in any state or other jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. When used in this press release, the words “expect,” “intend,” “will” or “approximately” or the negative of these words, or similar words or phrases that are predictions of or indicate future events and that do not relate solely to historical matters, are intended to identify forward-looking statements. You can also identify forward-looking statements by discussions of strategy, plans or intentions of management. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and the Company may not be able to realize them. The Company does not guarantee that the transactions and events described will happen as described (or that they will happen at all). You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this press release. While forward-looking statements reflect the Company’s good faith beliefs, they are not guarantees of future performance. The Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events, except as required by law. In light of these risks and uncertainties, the forward-looking events discussed in this press release might not occur as described, or at all.
Additional information concerning factors that could cause actual results to differ materially from these forward-looking statements is contained from time to time in the Company’s SEC filings, including its Annual Report on Form 10-K for the year ended December 31, 2025. Copies of each filing may be obtained from the Company or the SEC. Such forward-looking statements should be regarded solely as reflections of the Company’s current plans and estimates. Actual results may differ materially from what is expressed or forecast in this press release.
About Essential Properties Realty Trust, Inc.
Essential Properties Realty Trust, Inc. is an internally managed REIT that acquires, owns and manages primarily single-tenant properties that are net leased on a long-term basis to companies operating service-oriented or experience-based businesses. As of December 31, 2025, the Company’s portfolio consisted of 2,300 freestanding net lease properties with a weighted average lease term of 14.4 years and a weighted average rent coverage ratio of 3.6x. In addition, as of December 31, 2025, the Company’s portfolio was 99.7% leased to tenants operating 659 different concepts across 48 states.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260217302531/en/
Investor/Media:
Essential Properties Realty Trust, Inc.
Sheryl Kaul
Director, Financial Planning & Data Analytics
609-436-0619
investors@essentialproperties.com
FAQ**
How will the proceeds from the forward sale agreements impact the long-term growth strategy of Essential Properties Realty Trust, Inc. (EPRT) and its potential investments in new properties?
What are the main factors driving the current portfolio performance of Essential Properties Realty Trust, Inc. (EPRT), given its high lease occupancy rate of 99.7%?
Can Essential Properties Realty Trust, Inc. (EPRT) provide insights on any risks or market conditions that might affect the execution of the forward sale agreements mentioned in the recent announcement?
How does Essential Properties Realty Trust, Inc. (EPRT) plan to manage the potential dilution of shares resulting from this underwritten public offering, particularly concerning shareholder value?
**MWN-AI FAQ is based on asking OpenAI questions about Essential Properties Realty Trust Inc. (NYSE: EPRT).
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