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Institutional Investor Presentation SECOND QUARTER 2020 INSTITUTIONAL INVESTOR PRESENTATION Contents Investment Thesis 4 Company Overview 6 Summary of COVID-19 Impact 7 Superior Performance During Great Recession 11 Performance Track Record 16 Our Approach and 2Q20 Results 24 Portfolio Diversification 25 Defensive Retail Portfolio 30 Asset Management & Real Estate Operations 35 Investment Strategy 39 Capital Structure & Scalability 45 Dependable Dividends 49 Corporate Responsibility 51 Summary 53 Appendix 54 - Top Industries Overview 55 All data as of June 30, 2020 unless otherwise specified 2 Safe Harbor For Forward-Looking Statements Statements in this investor presentation that are not strictly historical are “forward-looking” statements. Forward-looking statements involve known and unknown risks, which may cause the company’s actual future results to differ materially from expected results. These risks include, among others, general economic conditions, domestic and foreign real estate conditions, tenant financial health, the availability of capital to finance planned growth, volatility and uncertainty in the credit markets and broader financial markets, changes in foreign currency exchange rates, property acquisitions and the timing of these acquisitions, charges for property impairments, the effects of the COVID-19 pandemic and the measures taken to limit its impact, the effects of pandemics or global outbreaks of contagious diseases or fear of such outbreaks, the company's tenants' ability to adequately manage its properties and fulfill their respective lease obligations to the company, and the outcome of any legal proceedings to which the company is a party, as described in the company’s filings with the Securities and Exchange Commission. Consequently, forward-looking statements should be regarded solely as reflections of the company’s current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. 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 these statements were made. 3 Investment Thesis Business model offers attractive total return with minimal cash flow volatility PROVEN TRACK RECORD OF RETURNS 15.3% Compound Average Annual Total Return Since ‘94 NYSE Listing 0.4 Beta vs. S&P 500 PREDICTABLE CASH FLOW Years with Positive Earnings Per Share 23 of 24 Growth(1) 94.0% Adjusted EBITDAre Margin POTENTIAL GROWTH OPPORTUNITIES $12 Trillion Corporate-Owned Real Estate in the US and Europe $57 Billion Sourced Acquisition Opportunities in 2019 (1) AFFO / Excludes positive earnings from Crest Net Lease, a subsidiary of Realty Income, as earnings do not reflect recurring business operations 4 Current Valuation Offers Attractive Entry Point “Lower for longer” rate environment should support multiple expansion given historical relationship Historical AFFO Yield Spread(1) vs 10-Year US Treasury 750 bps European 650 bps sovereign debt Economic Current spread is crisis slowdown in ~2.7x standard Fiscal cliff 550 bps China, Fed deviations wide of 500 bps 526 bps uncertainties tightening historical relationship 431 bps 450 bps 427 bps Median = 321 350 bps 250 bps 150 bps Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 NTM AFFO “Run-Rate” $3.39 Fair value stock price suggests Current yield spread of ~500 bps ÷ Current Stock Price $60.05 ~$89 for historical implies market is pricing in: = Current AFFO Yield 5.6% spread relationship to ~33% decline in AFFO/sh -- Current UST 10yr Yield 0.6% hold, assuming or 10y yield = AFFO Yield Spread ~500 bps remains at 2.3% 10yr yield current levels (1) Based on consensus NTM AFFO/sh As of 7/31/2020 | Source: SNL, Bloomberg 5 Realty Income Company Overview Business model has generated above-market returns with below-market volatility since 1994 S&P 500 DIVERSIFIED, HIGH-QUALITY TRACK RECORD OF SAFETY REAL ESTATE COMPANY “NET LEASE” PORTFOLIO AND CONSISTENCY $28B A3 / A- 6,541 9.0 23 OF 24 enterprise value credit ratings by commercial real years weighted years of positive earnings Moody’s and S&P estate properties average remaining per share(2) growth lease term $1.6B 51 annualized base years of operating rent history 84% 48% 5.1% 94.0% of rent generated of rent from median adjusted from retail investment-grade earnings per EBITDAre Member of S&P 500 properties rated tenants share(2) growth margin Dividend Aristocrats® index tenants(1) 1 of 8 U.S. REITs with ~600 at least two A3/A- ratings 50 industries 15.3% 0.4 TSR since 1994 beta vs. S&P 500 1 of only 2 REITs U.S. states, Puerto NYSE listing since 1994 NYSE in both categories 49 Rico, and the U.K. listing (1) Starting Q2 2020, we are consolidating some subsidiaries that we previously accounted for as separate entities into their parent companies (2) AFFO through most recent calendar year/ Excludes earnings from Crest Net Lease, a subsidiary of Realty Income, as earnings do not reflect recurring business operations 6 Summary of COVID-19 Impact Collections continue to trend higher; abatements and lease modifications have been immaterial July 2020 Rent Collection Metrics July Rent Collections by Property Type 100.0% Received 91.5% of contractual rent across total portfolio 95.8% 97.4% 90.5% Received 90.7% of contractual rent from Top 20 tenants Received 100% of contractual rent from Investment Grade tenants(1) Top four industries sell essential goods and paid 99.7% of rent • Convenience, Drug, Dollar and Grocery stores represent 37% of rent(2) Theater industry represents ~59% of uncollected July rent Retail Office Industrial Agriculture 2Q 2020 Rent Collection Metrics (Updated as of 7/31/20) Q2 2020 Rent Collections by Received 86.5% of contractual rent across total portfolio Property Type 99.0% 100.0% Received 82.5% of contractual rent from Top 20 tenants 97.0% 84.4% Received 99.1% of contractual rent from Investment Grade tenants(1) Top four industries sell essential goods and paid 99.7% of rent Theater, Health & Fitness, Restaurant and Child Care industries represent ~87% of uncollected 2Q rent Abatements/Lease Modifications represent ~5bps of contractual rent due Retail Office Industrial Agriculture Bad Debt Expense (cash) represents ~1.5% of contractual rent due (1) Investment grade tenants are defined as tenants with a credit rating of Baa3/BBB- or higher from one of the three major rating agencies (Moody’s/S&P/Fitch). ~48% of our annualized rental revenue is generated from properties leased to investment grade tenants, their subsidiaries or affiliated companies. (2) Reflects percentage of revenue (excluding reimbursables) for 2Q20 7 Rent Collections from Top 20 Industries Tenants operating in core industries selling ‘essential goods’ paid almost all rent due in July and Q2 2020 July Rent Collections 12.2% % of July Contractual Rent Collected % of July Contractual Rent Not Collected 8.7% 8.5% 7.9% 7.1% Received 91.5% of contractual rent due for July 2020 5.9% 99% 5.7% 4.2% 100% 100% 100% 88% 3.1% 2.9% 2.8% 2.5% 2.4% 2.2% 2.0% 2.0% 87% 100% 1.9% 1.6% 1.6% 1.7% 88% 100% 100% 16% 92% 100% 85% 100% 100% 100% 93% 100% 99% Q2 2020 Rent Collections 12.1% % of Q2 Contractual Rent Collected % of Q2 Contractual Rent Not Collected 8.7% 8.5% 7.9% 7.2% Received 86.5% of contractual rent due for Q2 2020 6.0% 5.7% 99% 100% 100% 4.2% 3.1% 100% 2.9% 2.8% 2.5% 2.4% 2.2% 2.1% 2.0% 47% 85% 100% 1.9% 1.6% 1.6% 1.7% 3% 85% 100% 100% 85% 100% 61% 92% 100% 100% 100% 100% 99% Sorted by percentage of total contractual rent due for July and Q2 2020 As of July 31, 2020 8 Cyclical Comparison – Entered Current Recession from a Position of Strength Favorable balance sheet, scale and capital markets backdrop relative to Great Financial Crisis SCALE AND LIQUIDITY YE 2007 Q2 2020 Enterprise Value (in billions) $4.3 $28.1 Available Liquidity (in millions)(1) $593 $2,707 Fixed Charge Coverage Ratio 3.1x 5.4x LEVERAGE AND CREDIT RATINGS YE 2007 Q2 2020 Net Debt / Adjusted EBITDARre 5.7x 5.1x Total Debt / Total Market Capitalization 33.7% 27.8% Credit Ratings (Moody’s / S&P) Baa1 / BBB A3 / A- CAPITAL MARKETS BACKDROP YE 2007 Q2 2020 Revolver Interest Rate (All-in)(2) 5.2% 0.94% 10-Year US Treasury Yield 4.02% 0.66% Amount of Fiscal Stimulus(3) ~$800 billion >$2 trillion (1) Includes revolver availability (excluding the accordion feature, which is subject to obtaining lender commitments), cash and ST investments at the end of each period (2) Based on all-in drawn borrowing rate at end of each period (3) 2009 American Recovery and Reinvestment Act and 2020 CARES Act (excludes ~$2.3 trillion in Fed facilities) / size estimates as of time of passage 9 Ample Covenant Headroom Strong coverage metrics, minimal secured debt, healthier overall covenant cushion vs. 2007 Unsecured Notes Covenant Requirement FY 2007 Q2 2020 Total ≥ 150% Unencumbered 239% Assets 267% (Unencumbered Assets / Unsecured Debt) Debt Service ≥ 1.5x 4.2x Coverage 5.4x (Pro forma EBITDA / Interest Expense) Incurrence of ≤ 40% Secured Debt 0.0% 1.9% (Secured Debt / Gross Asset Value) Incurrence of ≤ 60% Total Debt 41.9% (Total Debt / 38.1% Gross Asset Value) Refer to page 12 of our Q2 2020 Supplemental Operating & Financial Data for additional details on covenant calculations 10 SUPERIOR PERFORMANCE DURING GREAT RECESSION Superior Earnings Growth and TSR During Great Recession 1 of 2 S&P 500 REITs with positive earnings growth, dividend
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