Agree Realty Corporation Reports Operating Results for the Fourth Quarter and Full Year 2012

Agree Realty Corporation Reports Operating Results for the Fourth Quarter and
                                Full Year 2012

PR Newswire

FARMINGTON HILLS, Mich., Feb. 27, 2013

FARMINGTON HILLS, Mich., Feb. 27, 2013 /PRNewswire/ --

Fourth Quarter and Full Year Financial and Operating Results:

  oIncreased funds from operations for the quarter by 27%, and 6% year over
    year
  oIncreased total revenues for the quarter by 24%, and 14% year over year
  oAcquired 25 single tenant net leased properties in 2012 for $81.5 million
  oCommenced seven development projects for four leading retailers
  oSold six non-core properties for $16 million including three Kmart
    anchored shopping centers which reduced Kmart annualized base rentals by
    29%
  oPortfolio occupancy increased approximately 6% to 98% at December 31, 2012
    from 92.7% at December 31, 2011
  oPaid $0.40 per share quarterly dividend on January 2, 2013

Agree Realty Corporation (NYSE: ADC) today announced results for the quarter
and full year ended December 31, 2012. Fourth quarter funds from operations
(FFO) increased approximately 27% year over year to $6,081,000 compared with
FFO for the fourth quarter of 2011 of $4,786,000. FFO per diluted share for
the fourth quarter of 2012 was $0.52 compared with FFO per diluted share of
$0.48 for the fourth quarter of 2011.

For the year ended December 31, 2012, FFO increased to $23,363,000 compared
with FFO, as adjusted, for the year ended December 31, 2011 of $22,018,000.
FFO per diluted share for the year ended December 31, 2012 was $2.03 compared
with FFO per diluted share, as adjusted, of $2.20 for the year ended December
31, 2011. FFO and FFO per diluted share were impacted by the increase in the
weighted average shares outstanding as the result of the common share offering
in January 2012, the timing of investment activity, the disposition of various
non-core properties and the impact of the Borders bankruptcy in February 2011.

Fourth quarter adjusted funds from operations (AFFO) increased to $6,065,000
compared with AFFO for the fourth quarter of 2011 of $4,833,000. AFFO per
diluted share for the fourth quarter of 2012 was $.52 compared to AFFO per
diluted share of $.48 for the fourth quarter of 2011.

For the year ended December 31, 2012, AFFO increased to $23,933,000 compared
with AFFO, as adjusted, for the year ended December 31, 2011 of $22,447,000.
AFFO per diluted share for the twelve months of 2012 was $2.08 compared to
AFFO per diluted share, as adjusted, of $2.24 for the twelve months of 2011.
AFFO and AFFO per diluted share were impacted by the increase in the weighted
average shares outstanding as the result of the common share offering in
January 2012, the timing of investment activity, the disposition of various
non-core properties and the impact of the Borders bankruptcy in February
2011.

Net income for the fourth quarter of 2012 increased to $4,747,000, or $0.41
per diluted share, compared to net income for the fourth quarter of 2011 of
$3,221,000, or $.32 per diluted share. Total revenues increased 24%, or
$1,835,000, to $9,578,000, compared with total revenues of $7,743,000 in the
fourth quarter of 2011.

For the year ended December 31, 2012, net income increased to $18,603,000, or
$1.62 per diluted share, compared with net income for the comparable period
last year of $9,889,000, or $.99 per diluted share. Total revenues increased
14% to $35,789,000 compared with total revenues of $31,408,000 for the
comparable period last year.

"I am extremely pleased to report positive operating results for year. We
continue to improve and expand our portfolio, while growing revenues and FFO.
The Company had a record year for new property acquisitions, investing over
$81 million in 25 assets, adding 11 new industry leading tenants to our
portfolio. Simultaneously, we continue to expand our development pipeline
with seven commencements in 2012. Additionally, our balance sheet and
liquidity remain in excellent condition. During 2012, we took advantage of the
low interest rate environment and permanently secured or refinanced $71.5
million in long-term debt, as well as closed on the recast of our credit
facility extending the term and reducing the interest rate," said Joey Agree,
President and Chief Executive Officer. "We are well prepared to pursue
opportunities in 2013 that will further expand, enhance and diversify our
portfolio."

More information about the Company's calculations of FFO and AFFO, as well as
reconciliations of net income (in accordance with generally accepted
accounting principles) to FFO, FFO, as adjusted, AFFO, and AFFO, as adjusted,
is included in the financial tables accompanying this press release. For
2011, the Company calculated FFO, as adjusted, and AFFO, as adjusted, which
exclude from FFO and AFFO, respectively, certain non-recurring gain items that
the Company does not believe are reasonably likely to occur within two years.

Acquisitions

The Company acquired 25 single tenant properties during 2012 for a total of
approximately $81.5 million. The Company acquired 11 retail properties during
the fourth quarter for approximately $31.8 million. The single tenant
properties acquired during the fourth quarter are net leased to Mattress Firm
in Morrow, Georgia; Harris Teeter in Charlotte, North Carolina; Dollar General
Market in Lyons, Georgia; Big Lots in Fuquay-Varina, North Carolina; AutoZone
in Minneapolis, Minnesota; LA Fitness in Lake Zurich, Illinois; Advance Auto
Parts in Lebanon, Virginia; and a portfolio of four Applebee's located in
Harlingen, Texas; Wichita Falls, Texas; and two in Pensacola, Florida.

Development/Redevelopment

In December 2012, the Company closed on the acquisition of a building in Ann
Arbor, Michigan for redevelopment. The 18,000 square foot building is located
on the central campus of the University of Michigan. The redevelopment, which
is pre-leased to the industry leader in the retail pharmacy sector, is
expected to be completed by the second quarter of 2014. The purchase price
was $5.8 million.

During 2012, the Company closed on three parcels of land that are under
development for Wawa gas and convenience stores with anticipated rent
commencements during 2013. In May 2012, the Company closed on the acquisition
of a parcel of land in Kissimmee, Florida for the development of a Wawa
convenience store. Rent under the ground lease is expected to commence early
in the second quarter of 2013. In August 2012, the Company closed on the
acquisition of a parcel of land in Pinellas Park, Florida to be developed for
Wawa under a ground lease with the Company. Rent is anticipated to commence
in the second quarter of 2013. In addition, the Company announced that it
closed on the acquisition of a parcel of land in Casselberry, Florida for
development expected to be completed by the fourth quarter of 2013.

Construction activity continues at the Rancho Cordova, California property
being developed for Walgreens with rent expected to commence in the second
quarter of 2013.

In November 2011, the Company announced that it had closed on the acquisition
of a parcel of land in Southfield, Michigan to be ground leased to
McDonald's. McDonald's completed the construction of the restaurant and
opened in May 2012. The Company closed on the acquisition of a land parcel in
Venice, Florida in May 2012 to ground lease to JPMorgan Chase Bank. Chase
constructed a retail bank branch on the site and rent started in the fourth
quarter of 2012. Miner's Super One Foods at Ironwood Commons Center opened in
the expansion during the fourth quarter of 2012.

Dispositions

The Company sold six non-core assets during 2012. Aggregate proceeds from the
dispositions were approximately $16,100,000. The dispositions included two
vacant single tenant retail properties for approximately $4,460,000, a vacant
office property for approximately $650,000 as well as three Kmart anchored
shopping centers: Plymouth Commons in Plymouth, Wisconsin, Shawano Plaza in
Shawano, Wisconsin and Charlevoix Commons in Charlevoix, Michigan for
approximately $10,975,000. The sale of the three Kmart anchored shopping
centers reduced the Company's annualized base rentals attributable to Kmart by
approximately 29%.

Portfolio

At December 31, 2012, the Company's portfolio consisted of 109 properties
located in 27 states with a total of approximately 3.3 million square feet of
gross leasable space. The portfolio was approximately 98% leased at the end
of the quarter. Total assets were $370,093,000.

The Company's construction in progress balance totaled approximately
$18,981,000 at December 31, 2012.

Major Tenants

The following is a breakdown of base rents in effect at December 31, 2012 for
each of the Company's major tenants:

           Annualized Base  Percent of Total
Tenant
           Rent             Base Rent
Walgreens  $  11,494,744   30%
Kmart      2,748,691        7%
CVS        2,463,490        7%
Total      $  16,706,925   44%

Annualized Base Rent of Properties

The following is a breakdown of base rents in effect at December 31, 2012 for
each type of retail tenant:

                Annualized Base  Percent of Base
Type of Tenant
                Rent             Rent
National        $  33,408,661   88%
Regional        $   3,508,638  9%
Local           $   1,210,481  3%
Total           $  38,127,780   100%

Lease Expirations

The following table, as of December 31, 2012, sets forth lease expirations for
the next 10 years for the Company's portfolio, assuming that none of the
tenants exercise renewal options or terminate their leases prior to the
contractual expiration date.

            
                       Gross Leasable Area  Annualized Base Rent
Expiration  Number of
                       Square    Percent of               Percent of
Year        Leases                            Amount
                       Footage    Total                    Total
            Expiring
2013        14         295,622    9.2%        $1,044,724   2.7%
2014        18         288,569    9.0%        1,429,933    3.8%
2015        20         506,682    15.8%       2,536,788    6.7%
2016        15         108,341    3.4%        1,011,132    2.6%
2017        11         88,369     2.7%        1,580,510    4.1%
2018        11         136,841    4.3%        1,704,739    4.5%
2019        7          85,170     2.6%        1,820,559    4.8%
2020        5          114,101    3.6%        1,101,778    2.9%
2021        11         204,568    6.4%        3,670,185    9.6%
2022        5          156,212    4.9%        1,166,390    3.1%
Thereafter  67         1,220,391  38.1%       21,061,042   55.2%
Total       184        3,204,866  100.0%      $38,127,780  100.0%

Capital Markets/Balance Sheet

During 2012, the Company raised or refinanced $156.5 million of total debt,
including $71.5 million of long-term mortgage debt in 2012 at a
weighted-average fixed annual rate of 3.22%, including the effect of interest
swap agreements. The Company currently has a weighted-average mortgage debt
maturity of 5.7 years and no aggregate annual maturities exceeding $10 million
until 2017.

The Company closed on an amended and restated $22.9 million term loan in June
2012 to replace its existing 3.74% term loan. The term loan will mature May
2019, inclusive of a two year extension, at the Company's election, which is
subject to customary conditions. The Company entered into a forward interest
rate agreement to fix the interest rate at 3.62% for the period July 2013
until maturity.

The Company entered into a new $25,000,000 secured financing with PNC Bank,
National Association in December 2012. The non-recourse loan is secured by 11
single tenant properties. The interest rate has been swapped to a fixed rate
of 2.49% and will mature April 2018.

The Company also closed on a $23,640,000 secured CMBS financing with Morgan
Stanley in December 2012. The 10-year, non-recourse loan is secured by 12
single tenant properties. The loan bears interest at 3.60% and matures in
January 2023.

The Company also entered into an amendment to its $85 million unsecured
revolving credit facility in December 2012. The amendment extended the
facility's maturity to October 2015 and provides for two one-year options to
extend the maturity, at the Company's discretion, to October 2017, subject to
customary conditions. Annual interest rates on borrowings under the amended
facility have been reduced to LIBOR plus 150 to 215 basis points, depending on
the Company's leverage ratio. The facility includes a $50 million accordion
feature to increase capacity to $135 million, subject to certain conditions,
to accommodate the Company's business plans.

In January 2013, the Company completed an underwritten public offering of a
total of 1,725,000 shares of common stock, including the full exercise of the
underwriter's over-allotment option, resulting in net proceeds to the Company
of approximately $44.9 million.

The Company's debt to total enterprise value was approximately 34% as of
December 31, 2012. The Company's debt to total enterprise value decreased to
approximately 24% after taking in account the proceeds from the common stock
offering being used to reduce amounts outstanding under the Company's credit
facility. Enterprise value is calculated as the sum of mortgages payable and
notes payable and the market value of the Company's outstanding shares of
common stock, assuming conversion of operating partnership units.

Dividend

The Company paid a cash dividend of $0.40 per share on January 2, 2013 to
shareholders of record on December 17, 2012. The dividend is equivalent to an
annualized dividend of $1.60 per share and represents a payout ratio of 77% of
FFO for the quarter.

Outstanding Shares and Operating Partnership Units

For the three months and year ended December 31, 2012, the Company's fully
diluted weighted average shares outstanding were 11,263,680 and 11,136,910.
The basic weighted average shares outstanding for the three months and year
ended December 31, 2012 were 11,185,864 and 11,071,318.

The Company's assets are held by, and all of its operations are conducted
through, Agree Limited Partnership, of which the Company is the sole general
partner. As of December 31, 2012, there were 347,619 operating partnership
units outstanding and the Company held a 97.05% interest.

Conference Call/Webcast

Agree Realty Corporation will host a live broadcast of its fourth quarter 2012
conference call on Thursday, February 28, 2013 at 9:00 a.m. Eastern Time, to
discuss its financial and operating results. The live broadcast will be
available online at: http://www.videonewswire.com/event.asp?id=92093 and also
by telephone at USA Toll Free: 1-800-860-2442 and
International:1-412-858-4600. A replay will be available shortly after the
call by telephone at US Toll Free:1-877-344-7529/Conference #10024722 or
International Toll:1-412-317-0088/Conference #10024722 until May 31, 2013.

About Agree Realty Corporation

Agree Realty Corporation is primarily engaged in the acquisition and
development of single tenant properties leased to industry leading retail
tenants. The Company currently owns and operates a portfolio of 112
properties, located in 29 states and containing approximately 3.3 million
square feet of gross leasable space. The common stock of Agree Realty
Corporation is listed on the New York Stock Exchange under the symbol "ADC."

Forward-Looking Statements

The Company considers portions of the information contained in this release to
be forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934,
each as amended. These forward-looking statements represent the Company's
expectations, plans and beliefs concerning future events. Although these
forward-looking statements are based on good faith beliefs, reasonable
assumptions and the Company's best judgment reflecting current information,
certain factors could cause actual results to differ materially from such
forward–looking statements. Such factors are detailed from time to time in
reports filed or furnished by the Company with the Securities and Exchange
Commission, including the Company's Form 10-K for the year ended December 31,
2011. Except as required by law, the Company assumes no obligation to update
these forward–looking statements, even if new information becomes available in
the future.

For additional information, visit the Company's home page on the Internet at
http://www.agreerealty.com.



Agree Realty Corporation
Operating Results (in thousands, except per share amounts)
(Unaudited)
                            Three Months Ended        Year Ended
                            December 31,              December 31,
                            2012         2011         2012         2011
Revenues:
Minimum rents               $       $       $       $     
                             9,103       7,414      33,541       28,359
Percentage rent             5            12           27           35
Operating cost              470          278          2,161        1,969
reimbursements
Development fee income      -            -            -            895
Other income                -            39           60           150
Total Revenues              9,578        7,743        35,789       31,408
Expenses:
Real estate taxes           539          470          1,903        1,899
Property operating          291          267          1,102        1,176
expenses
Land lease payments         106          181          574          722
General and administration  1,529        1,609        5,682        5,662
Depreciation and            1,683        1,374        6,470        5,416
amortization
Impairment charge           -            -            -            600
Total Operating Expenses    4,148        3,901        15,731       15,475
Income from Operations      5,430        3,842        20,058       15,933
Other Income (Expense)
Interest expense            (1,508)      (1,072)      (5,134)      (3,957)
Gain on extinguishment of   -            -            -            2,360
debt
Income Before Discontinued  3,922        2,770        14,924       14,336
Operations
Gain on sale of asset from  350          110          2,097        110
discontinued operations
Income (Loss) from          475          341          1,582        (4,557)
discontinued operations
Net Income                  4,747        3,221        18,603       9,889
Net income attributable to  140          110          554          338
non-controlling interest
Net Income Attributable to  4,607        3,111        18,049       9,551
Agree Realty Corporation
Other Comprehensive Income
(Loss) , Net of $(0), $4,
$(21) and $6
Attributable to             (4)          125          (687)        158
Non-Controlling Interest
Total Comprehensive Income  $       $       $       $     
Attributable to Agree        4,603       3,236      17,362        9,709
Realty Corporation
Basic Earnings (Loss) Per
Share
Continuing operations       $       $       $       $     
                              0.34       0.28       1.31       1.44
Discontinued operations     0.07         0.04         0.32         (0.45)
                            $       $       $       $     
                              0.41       0.32       1.63       0.99
Dilutive Earnings (Loss)
Per Share
Continuing operations       $       $       $       $     
                              0.34       0.28       1.30       1.43
Discontinued operations     0.07         0.04         0.32         (0.44)
                            $       $       $       $     
                              0.41       0.32       1.62       0.99
Weighted Average Number of
Common Shares Outstanding   11,186       9,635        11,071       9,637
- Basic
Weighted Average Number of
Common Shares Outstanding   11,264       9,685        11,137       9,681
- Dilutive





Agree Realty Corporation
Funds from Operations (in thousands, except per share amounts)
(Unaudited)
                            Three Months Ended        Year Ended
                            December 31,              December 31,
                            2012         2011         2012         2011
Reconciliation of Funds
from Operations to Net
Income: (1)
Net income                  $       $       $       $     
                             4,747       3,221      18,603        9,889
Depreciation of real        1,452        1,504        5,726        6,005
estate assets
Amortization of leasing     28           31           106          272
costs
Amortization of lease       204          140          1,025        519
intangibles
Impairment charge           -            -            -            13,500
Gain on sale of assets      (350)        (110)        (2,097)      (110)
Funds from Operations       $       4,786        $       30,075
                             6,081                   23,363
Gain on extinguishment of   -            -            -            (2,360)
debt
Deferred revenue            -            -            -            (5,697)
recognition
Funds from Operations, as   $       $       $       $     
adjusted                     6,081       4,786      23,363       22,018
Funds from Operations Per   $       $       $       $     
Share - Dilutive              0.52       0.48       2.03       3.00
Funds from Operations Per   $       $       $       $     
Share - Dilutive, as          0.52       0.48       2.03       2.20
adjusted
Weighted Average Number of
Common Shares Outstanding   11,611       10,033       11,485       10,029
- Dilutive
Adjusted Funds from Operations (in thousands, except per share amounts)
(Unaudited)
Net income                  $       $       $       $     
                             4,747       3,221      18,603        9,889
Cumulative adjustments to   1,334        1,565        4,760        20,186
calculate FFO
Funds from Operations       6,081        4,786        23,363       30,075
Straight-line accrued rent  (240)        (114)        (738)        (263)
Deferred revenue            (115)        (116)        (463)        (6,416)
recognition
Stock based compensation    421          322          1,657        1,364
expense
Amortization of mortgage    86           30           285          122
financing costs
Capitalized building        (168)        (75)         (171)        (75)
improvements
Adjusted Funds from         $       4,833        $       24,807
Operations                   6,065                   23,933
Gain on extinguishment of   -            -            -            (2,360)
debt
Adjusted Funds from         $       $       $       $     
Operations, as adjusted      6,065       4,833      23,933       22,447
Adjusted Funds from         $       $       $       $     
Operations Per Share -        0.52       0.48       2.08       2.47
Dilutive
Adjusted Funds from         $       $       $       $     
Operations Per Share -        0.52       0.48       2.08       2.24
Dilutive, as adjusted
Supplemental Information:
Scheduled principal         $       $       $       $     
repayments                    836       770      3,165       3,575



(1) FFO is defined by the National Association of Real Estate
Investment Trusts, Inc. (NAREIT)to mean net income computed in accordance
with U.S. generally accepted accounting principles (GAAP), excluding gains (or
losses) from sales of property, plus real estate related depreciation and
amortization and after adjustments for unconsolidated partnerships and joint
ventures. Management uses FFO as a supplemental measure to conduct and
evaluate the Company's business because there are certain limitations
associated with using GAAP net income by itself as the primary measure of the
Company's operating performance. Historical cost accounting for real estate
assets in accordance with GAAP implicitly assumes that the value of real
estate assets diminishes predictably over time. Since real estate values
instead have historically risen or fallen with market conditions, management
believes that the presentation of operating results for real estate companies
that use historical cost accounting is insufficient by itself.

FFO should not be considered as an alternative to net income as the primary
indicator of the Company's operating performance or as an alternative to cash
flow as a measure of liquidity. Further, while the Company adheres to the
NAREIT definition of FFO, its presentation of FFO is not necessarily
comparable to similarly titled measures of other REITs due to the fact that
not all REITs use the same definition.

Adjusted Funds from Operations ("AFFO") is a non-GAAP financial measure of
operating performance used by many companies in the REIT industry. AFFO
further adjusts FFO for certain non-cash items that reduce or increase net
income in accordance with GAAP. AFFO should not be considered an alternative
to net earnings, as an indication of the company's performance or to cash flow
as a measure of liquidity or ability to make distributions. Management
considers AFFO a useful supplemental measure of the company's performance.
The company's computation of AFFO may differ from the methodology for
calculating AFFO used by other equity REITs, and therefore may not be
comparable to such other REITs. 



Agree Realty Corporation
Consolidated Balance Sheets (in thousands)
(Unaudited)
                                           December 31,     December 31,
                                           2012             2011
Assets:
Land                                     $         $    108,673
                                           134,741
Buildings                                  240,204          229,821
Accumulated depreciation                   (58,509)         (68,590)
Property under development                18,981           1,580
Property held for sale                     4,538            -
Cash and cash equivalents                  1,270            2,003
Accounts receivable                       2,160            802
Deferred costs, net of amortization        24,895           18,692
Other assets                               1,813            963
Total Assets                               $         $    293,944
                                           370,093
Liabilities
Mortgages payable                          $         $      62,854
                                           117,376
Notes payable                              43,530           56,444
Deferred revenue                           1,931            2,394
Dividends and distributions payable        4,710            4,071
Other liabilities                          4,581            5,957
Total Liabilities                          172,128          131,720
Stockholder's Equity
Common stock (11,436,044 and 9,851,914     1                1
shares)
Additional paid-in capital                 217,769          181,070
Deficit                                    (21,167)         (20,919)
Accumulated other comprehensive income     (1,294)          (607)
(loss)
Non-controlling interest                   2,656            2,679
Total Stockholder's Equity                 197,965          162,224
                                           $         $    293,944
                                           370,093





SOURCE Agree Realty Corporation

Website: http://www.agreerealty.com
Contact: Alan D. Maximiuk, Chief Financial Officer, +1-248-737-4190