Well covered — rebuilt after a reset. A quarterly payer, not a monthly one: the dividend was raised to $0.95 a share on September 18, 2026, and AFFO covers it with room — a 70.6% payout in the first half of 2026. The honest caveat is the history: the dividend was reset to $0.86 in late 2023 after the office spin-off, ending a long raise streak, and has been raised every quarter since from that lower base. For a REIT, the House reads AFFO payout — never the EPS payout, which depreciation makes meaningless.
Key risk: A tenant credit event that turns into rent loss, or refinancing at higher rates squeezing AFFO — Hellweg's 2026 credit event is the live example, and the AFFO cushion is what absorbs it.
Changes if: The AFFO payout pushes well past ~71%, leverage rises past 5.5×, or the lease base weakens — shorter WALE, falling occupancy. The cushion is the verdict.
- ✓AFFO coverage check: 70.6% of AFFO paid out in H1 2026 — Q2 AFFO was $1.34 a share against the $0.94 declared that quarter — leaves a real cushion for a REIT. The growth is a rebuild, not a streak: reset to $0.86 in late 2023 after the office spin-off, then raised every quarter since to $0.95.
- ✓Yield check: ~5.9% is high but earned — backed by a 12.2-year weighted-average lease term at 98.5% occupancy across 384 tenants; the top ten tenants are only 18.1% of annualized base rent and the largest is 2.6%, so it is not one tenant bet.
- !Leverage check: 5.5× net debt to annualized adjusted EBITDA is investment grade (Baa1 / BBB+) but not light — it reads 5.1× only after counting ~$691M of unsettled forward equity, and new debt is pricing well above the 3.2% average rate on the existing stack.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.