Greetings, and welcome to the National Retail Properties’ Third Quarter 2012 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Craig MacNab. Thank you, Mr. MacNab. You may begin.

Brenda, thanks very much. Good morning, and welcome to our third quarter 2012 earnings call. On this call with me this morning are Jay Whitehurst, our President; and Kevin Habicht, our Chief Financial Officer, who will review details of our third quarter financial results following my brief opening comments. Also, Kevin will update you on this year’s guidance plus provide some of the key assumptions in our 2013 guidance. We’ve just completed another strong predictable quarter at NNN and are optimistic that our acquisition momentum will continue in the fourth quarter. As indicated in our press release, we’re projecting second consecutive year of excellent FFO per share growth. Equally importantly, we are also guiding towards steady growth in 2013 helped by the net lease retail acquisitions that we’ve already made this year as well as those that we’re anticipating to close in the current quarter. In the third quarter, we acquired 30 properties, investing $140 million at an initial cash yield of approximately 8.65%. We acquired these properties from 12 different tenants and each one of these tenants is what we describe as a relationship tenant, which of course means that we had little if any competition on these transactions. As a result, we’ve been able to maintain very attractive initial yields, which of course get better over time as the rent continues to grow. We’re pleased that a couple of our casual dining restaurant tenants were able to complete public offerings in the most recent quarter. In particular, Bloomin’ Brands, whose primary restaurant concept is Outback Steakhouse with whom we completed a $98 million portfolio acquisition at the beginning of this year. We’ve previously discussed that our underwriting process includes an evaluation of the future prospects of a tenant including their financing plans. It is gratifying when our internal evaluation of the likelihood of Bloomin’ Brands goes public comes to fruition soon after our portfolio acquisition. Dispositions in the third quarter were again steady and consistent with a little portfolio of pruning occurring, plus our excellent in-house disposition team very successfully closed out our convenience store joint venture. This joint venture generated meaningful returns to our JV partner, which of course means that we similarly earned a very good return on our equity plus we were pleased to realize promote and transaction fee income in the third quarter. In terms of the portfolio, our fully diversified portfolio continues to be fully occupied and is now 97.9% occupied. National Retail Properties continues to be very well positioned. We have cash on the balance sheet, which we expect to invest this quarter. Our portfolio is in excellent shape and as this year’s acquisitions come into our full year rent roll, we’re optimistic about our growth opportunity in 2013. Kevin?

Thanks, Craig. Let me start by saying, we will make certain statements that may be considered to be forward-looking statements under Federal Securities Law. The company’s actual future results may differ significantly from the matters discussed in these forward-looking statements, and we may not release revisions to those forward-looking statements to reflect changes after the statements were made. Factors and risks that could cause actual results to differ materially from expectations are disclosed from time-to-time in greater detail in the company’s filings with the SEC and in this morning’s press release. With that, this morning, we reported third quarter FFO of $0.52 per share, recurring FFO of $0.43 per share and AFFO of $0.47 per share. The $0.52 FFO results include two items we backed out to get to the $0.43 of recurring FFO. Those two items were $7.7 million reversal of a tax valuation allowance that we established in 2009 and 2010 in connection with some impairments we took in our TRS back then. And secondly, a $1,964,000 of incremental income we realized in the third quarter as the result of winding down our joint venture. This recurring FFO of $0.43 per share represents a 7.5% increase over 2011, $0.40 per share third quarter. Similarly, the recurring FFO for the nine months of $1.28 per share represents a 10.3% increase over prior-year amount. As usual, the strong results were a combination of maintaining high occupancy and making new accretive acquisition, while keeping our balance sheet strong. Occupancy was 97.9% at the quarter end, that’s down 30 basis points from the prior quarter, but it’s up 70 basis points from a year ago. And as Craig mentioned, we completed a $140 million of accretive acquisitions in the third quarter. Just looking back over the past seven quarters of back to…

Thank you. We will now be conducting a question-and-answer session (Operator Instructions) Our first question comes from Emmanuel Korchman of Citigroup. Please proceed with your question. Manny Korchman – Citigroup: Hey, good morning, guys. Just, if we look at the significant acquisition volumes you guys had this year and then your guidance, which I guess is kind of more towards your normal run rate next year. Why are you going to have sort of timing gap, that you’re saying that most of the transaction will come in the second half. Why wouldn’t that momentum continue?

Manny, it’s a fair question. But, as we’ve done in the past, we have tried to establish expectations that we can meet and preferably exceed. We – our visibility does not extend several quarters out in our acquisition approach. So, while we’ve got pretty good visibility on what we have on the fourth quarter heading into 2013 is, that number is a plug and our goal is to meet, but preferably exceed that acquisition volume. Manny Korchman – Citigroup: Okay. Great. And then, Kevin, can you – I might have missed your specific comment on the notes, how much cash are you going to use up for that, the note conversion, and then how much of that is going to be left for acquisitions?

Yeah. We’ll use a bit of it up, $100.6 million have converted, that’s the par amount and then we’re – you go through this 20-day observation pricing period, which is just concluding now to determine how much the premium above par is related to the conversion value. But pick a number call 30%. So if it’s $130 million, we’ll use quite a bit of the cash on balance sheet. However, we’ve got $500 million credit facility to tap into for near-term acquisitions. Manny Korchman – Citigroup: So then if we take your – you’ve $140 million of cash now on the balance sheet?

Right. Manny Korchman – Citigroup: And you can then use – so what’s the final number on the note conversion...?

I don’t have a final number for you yet, but...

Oh, good to see you, Manny. We use all of it.

Yeah, $135 million, yeah, some number... Manny Korchman – Citigroup: So, really your dilution for carrying cash on the balance sheet can be really limited, (inaudible) now rather than acquisition?

Right. In the month of November, correct. It’ll get utilized. Manny Korchman – Citigroup: Okay. Perfect. Thank you.

Our next question comes from Joshua Barber of Stifel, Nicolaus. Please proceed with your question. Josh Barber – Stifel Nicolaus: Hi, good morning. I was wondering if you could talk about, I may have missed this before, but what was the average cap rate on your third quarter acquisitions and what you have done throughout the year?

Josh, good morning. For the third quarter, we had a terrific initial cap rate of around 8.65% is the number I used, and for the nine months, it’s about 8.5%, initial cash cap rate. Josh Barber – Stifel Nicolaus: Okay. So, is that shift just more indicative of different property types or is that just some of your pipeline deals more closing in the third quarter versus portfolio transactions for the rest of the year?

Well, firstly, in terms of the difference, 8.65%, 8.5%, it’s pretty close given the number of properties we acquired. But, we’re continuing to source off market deals with both relationship and non-relationship tenants. Our team spent a lot of time on the road and there is plenty of properties out there and we’re finding some very attractive ones. So, we’re going to continue doing the same steady predictable acquisition approach. Josh Barber – Stifel Nicolaus: Okay. But I’m looking at your new credit line and you have the facility of taking up to $1 billion now. I mean, how big would you want to be putting things on your facility and is that you guys looking for, I guess, larger deals than you have in the last few years?

Yeah, I don’t think it really changes our approach to line usage and managing balance sheet risk and – but, yeah, we’re having a $500 million accordion feature that, if need be, we could size up that credit facility with additional lender support. But at the moment $500 million is a comfortable credit facility size for us and one that we will continue to use as we have in the past.

And Josh, just to supplement that you know, historically what we have done is, we’ve used our line of credit balance at the margin to complete transactions, and then have traditionally gone out into the credit markets and termed that out. So, even though that the pricing on this credit facility is terrific and reflects a good balance sheet, we historically have chosen not to rely on short-term bank debt to finance our company. Josh Barber – Stifel Nicolaus: Right and we all appreciate. One last question related to the Crow Holdings joint venture unwinding. Was there any option for you guys to buy the asset out of the JV once it was unwound and if so, how come that wasn’t exercised?

Yeah, Josh, we did have that opportunity and frankly we had every intention of buying them. They were very, very good properties leased to primarily two tenants, both of which are big tenants in our portfolio, Susser and Road Ranger. Somebody just got really aggressive on their pricing, when we were marketing these properties and just to put it in perspective, the cap rates on these properties was in the low-7%’s of trailing rent. There is a rent bump that kicks in here over the next month. So that’s off that, which is 7.85%. So, our fiduciary responsibility to our partner is to get them the best price and somebody else valued this more than we did. Josh Barber – Stifel Nicolaus: Great. Thank you very much.

Our next question comes from Paula Poskon of Robert W Baird. Please proceed with your question. Paula Poskon – Robert W Baird: Thanks. Good morning, everyone. Just a housekeeping question first and apologies if I missed this in your prepared remarks. What were the acquisition costs for the third quarter?

Acquisition costs for the third quarter were low, $40,000 for the quarter, $345,000 for the nine months. Paula Poskon – Robert W Baird: Thanks, Kevin. And then just a sort of a bigger picture perspective question. How close is your existing lines of trade exposure to your desired exposure and how does the acquisition opportunity set compare to that? So in other words, you said that the acquisition pipeline looks attractive, but are you seeing the breadth of opportunity sets across the lines of trade in terms of the exposure that you would like to have across those?

Well, it’s a good question and the first thing is that internally, Jay Whitehurst is on this call, our President, always reminds our group when we meet that we can only buy that which is for sale. So, our approach is a very bottoms-up process. We look at each property that meets our tests in terms of market rent, real estate location, and then at the backend we take a look to see how it fits into the portfolio mix. Obviously, a couple of years ago, we had a more meaningful exposure to the convenient store industry, we liked that a lot, but given that we haven’t done any real volume in the convenient store category, that has moved lower as a percent of our total rent. But we really like those corner locations at signalized intersections, leased to good tenants in an industry which has the dynamics of the convenient store category. So, if we can, we’d like to find some more properties in that area. But I think that if you take a look down the other categories, you’re going to see much of the same going forward. Paula Poskon – Robert W Baird: Thanks, Craig. And then – I’ll jump back in the queue, go ahead. Thank you.

Our next question comes from Todd Stender of Wells Fargo. Please proceed with your question. Todd Stender – Wells Fargo: Hi. Thanks, guys. Just going back to the dispositions, what properties did you sell in the quarter, what was the pricing of those just being the cap rates? And, Kevin, was the impairment related to those dispositions?

Yeah, I’ll jump on the impairment question, but no, they were really not. The impairments were related to one property that was condemned, one property that we did move to held-for-sale but not sold yet, and then a couple from an old bankruptcy a couple of years ago that we marked down, so.

Todd, in the most – in the third quarter, our acquisitions – if we take a look at, and I mean, I don’t mind feeding it to you, if you take a look at the number of properties right at the very back end of our press release, the number of Road Ranger properties declined and they entered into a particular transaction, which had the effect of us selling some of the weaker properties that we have leased to that tenant. We actually replaced a good bit of this volume with an outstanding property leased to Road Ranger right in Downtown Chicago. So, it’s a very, very good property and we got rid of some weaker real estate. We essentially agreed to this transaction – from a real estate standpoint, it’s very good to us and we agreed to sell those properties back to Road Ranger at our original purchase price, which is 8.75% cap rate. That was a transaction that we entered into with our tenant Road Ranger. It was good for the tenant and it was very good for us, so. As it so happened given the depreciation, we did generate an accounting gain from that transaction, but it’s not really an economic gain. Todd Stender – Wells Fargo: Okay. That’s helpful. Thanks, Craig. And just looking out to next year, it looks like you addressed a couple of the lease maturities. Is that correct or was that a reflection of stuff that was disposed of?

Yeah, the good news is in terms of lease maturities, many of our tenants have notification periods well in advance of when the lease comes due and so far we’re having some pretty good success with those. Todd Stender – Wells Fargo: Any of the economics you could share with us just seeing what the rent was and what it’s moved to?

Given that they’re exercising an option that they have, I think if you want to use a rule of thumb, these properties generally have a – given that the time, the date they were acquired, many of them have a 10% bump every five years. Todd Stender – Wells Fargo: Okay, that’s helpful. And just finally, Kevin, as far as your ATM with your share price pushing now $32, just under, have you guys issued any shares subsequent to the quarter?

I mean, we haven’t made any announcements around that, but we’ve – as we mentioned in the third quarter we did issue shares under the DRIP and the ATM and we have for the nine months; for the quarter, it was $58 million, so. Todd Stender – Wells Fargo: Okay. Thank you.

Our next question comes from the line of Rich Moore of RBC Capital Markets. Please proceed with your question. Rich Moore – RBC Capital Markets: Hello, guys. Good morning. On the tax benefit, real quick, Kevin, I don’t know if you guys mentioned it early in the call, but why is that so big, I guess, and I thought it had something to do with the impairment, but it’s as big as the impairment?

Yeah. No, no, it was related to impairments we took back in 2009 and 2010, and at that point in time we didn’t take any tax benefit for that. We’ve created a valuation allowance for the benefit associated with that impairment expense and so this is really unwinding that tax valuation allowance and so we’re booking at this quarter. We’ve backed it out in terms of calculating recurring FFO because we thought we’d see a non-cash kind of item and not recurring. It was related to 2009-2010 impairments in the TRS. Rich Moore – RBC Capital Markets: I got you.

Yeah. Rich Moore – RBC Capital Markets: I got you. Good, thanks. And then, as far as stuff like that and additional impairments, I realize if you have an impairment charge, you got to take it when you realize, but are you – is there something that triggered, I guess, the impairments this quarter that you maybe going through more of that same process going forward?

I mean, it’s the process we go through continuously as we evaluate properties and what we intend to do with them. Like I said, one of them was a condemnation and so those just come up from time-to-time, sometimes it might be an impairment, sometimes not, sometimes we’ll move a property from held to – for investment to held-for-sale, which we had to evaluate it and then we also look at any properties that might be vacant for a long period of time, we do an evaluation there. So, not something we really budget, if you will, but it’s something we look at continuously every quarter for potential impairment. Rich Moore – RBC Capital Markets: Okay. And then on the tax benefit that’s all done from 2009...

Yeah, that’s done, yeah. Yeah, that’s a good point. We don’t anticipate any tax expense or benefits flowing through in connection with anything going on in the TRS at this point. Rich Moore – RBC Capital Markets: Okay, great, thanks. And on the interest expense and interest income, both were up in the quarter and I assume, was that kind of the timing thing? Obviously, the interest income is from the cash balance I am guessing, and the interest expense was a bit surprising to be higher. I mean any thoughts on those?

Yeah, no, just generally more debt outstanding. We did do this August transaction, which we borrowed a lot of money, granted it was a good rate, but we weren’t using it. We had it sitting in cash that wasn’t earning us very much and so that drives some of that. Rich Moore – RBC Capital Markets: Okay, good. And then the last thing, I am a little bit curious, how much you guys have in your – how much volume of stuff you’re looking at for acquisitions because it seemed like it’s been pretty high for everybody and, I mean, is it that you’re seeing less stuff at this point or may be just not seeing the kind of stuff you would like to buy that you might think you’d see a bit of slowing going into next year?

So, Rich, I think on the third quarter was a pretty good quarter for us, very, very good, quality of real estate, excellent initial yields, nice growth in rent over time, so we’re looking at pretty much 10% type average return on those assets. So that to me suggests we’ve had a pretty good number of transactions in the hopper. In terms of total volume, at a point in time we used to track this religiously; after a while it occurred to me it’s a complete waste of time. What’s much more relevant to us here is the properties that we spend time on, the properties we go and visit, the tenants we go and visit and understanding their business, acquisition opportunity – if we continue to get out there, visit our tenants, deal with relationship tenants, we are going to drum up acquisition opportunities. And so, right now, our visibility is very good, Rich, in the fourth quarter to support the $500 million that Kevin mentioned in his numbers. 2013, there will be some opportunities and I hope that National Retail Properties takes advantage of those.

And I think that’s another plan on that, I mean, our guidance for FFO per share growth is 4% next year and that’s about $200 million of acquisition. So, to the extent we can do better and as Craig said, our visibility is not particularly long on our acquisitions pipeline, but if we can do better than that amount, then there is room for upside. But with a fairly modest – moderate amount of acquisition activity for next year, really backend loaded in the second half of next year, we are still growing FFO per share results 4%. Rich Moore – RBC Capital Markets: Okay, good, guys. Thank you.

(Operator Instructions) Our next question comes from the line of Paula Poskon of Robert W. Baird. Please proceed with your question. Paula Poskon – Robert W Baird: Thanks very much. Just a quick follow-up. Do you think any of the acquisition volume that you’re seeing right now is being driven by tax motivated sellers or do you think that’s just an overblown thesis?

In our case, I think it is overblown, Paula. The – every quarter for the last several years, we’ve seen a healthy opportunity sets and it’s our challenge to fill the spigot and then narrow it down to a very small funnel and take opportunities from that. Paula Poskon – Robert W Baird: Thanks.

Certainly, at this stage just as a supplemental comment, here we are in early November, any transactions that are going to close this year given the timeline of our business, they need to be well in the pipeline. Somebody deciding to sell properties today, conducting environmental analysis, et cetera, they’re going to fall into 2013. Paula Poskon – Robert W Baird: Thank you, Craig.

Brenda, thank you very much. We appreciate all of you participating in our call. We look forward to seeing a couple of you in San Diego at NAREIT meetings, but otherwise please contact any of us on this call Jay, Kevin or myself, and thank you very much for listening this morning. Good morning.

This concludes today’s teleconference. You may disconnect your lines at this time. And thank you for your participation.