Form 8-K STAG Industrial, Inc. For: Oct 30

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

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FORM�8-K

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CURRENT REPORT

PURSUANT TO SECTION�13 OR 15(d)�OF THE

SECURITIES EXCHANGE ACT OF 1934

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Date of Report (Date of earliest event reported): October�30, 2014

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STAG INDUSTRIAL,�INC.

(Exact name of registrant as specified in its charter)

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One Federal Street, 23rd�Floor

Boston, Massachusetts 02110

(Address of principal executive offices, zip code)

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Registrant�s telephone number, including area code: (617) 574-4777

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Not applicable

(Former name or former address, if changed since last report)

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Check the appropriate box below if the Form�8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

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o Written communications pursuant to Rule�425 under the Securities Act (17 CFR 230.425)

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o Soliciting material pursuant to Rule�14a-12 under the Exchange Act (17 CFR 240.14a-12)

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o Pre-commencement communications pursuant to Rule�14d-2(b)�under the Exchange Act (17 CFR 240.14d-2(b))

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o Pre-commencement communications pursuant to Rule�13e-4(c)�under the Exchange Act (17 CFR 240.13e-4(c))

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ITEM 2.02.������������������������������ RESULTS OF OPERATIONS AND FINANCIAL CONDITION

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On October�30, 2014, STAG Industrial,�Inc. (the �Company�) issued a press release announcing the results of operations for the Company for the three and nine months ended September�30, 2014.� A copy of such press release is furnished as Exhibit�99.1 to this report.� That press release referred to certain supplemental information that is available under the �Presentations� tab in the Investor Relations section of the Company�s website at www.stagindustrial.com.

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As previously announced and as further detailed in the press release furnished with this report, the Company will conduct a conference call at 11:00�a.m. eastern time on Friday, October�31, 2014, to discuss its financial results for the three and nine months ended September�30, 2014.

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The information in Item�2.02 of this report, including the information in the press release attached as Exhibit�99.1 to this report, is furnished pursuant to Item�2.02 of Form�8-K and shall not be deemed �filed� for the purposes of Section�18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section. Furthermore, the information in Item�2.02 of this report, including the information in the press release attached as Exhibit�99.1 to this report, shall not be deemed to be incorporated by reference in the filings of the registrant under the Securities Act of 1933.

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ITEM 9.01.������������������������������ FINANCIAL STATEMENTS AND EXHIBITS

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(d)�Exhibits.

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SIGNATURES

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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

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EXHIBIT�INDEX

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Exhibit 99.1

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STAG INDUSTRIAL ANNOUNCES THIRD QUARTER 2014 RESULTS

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Boston, MA � October�30, 2014 - STAG Industrial,�Inc. (the �Company�) (NYSE: STAG), a real estate investment trust focused on the acquisition and management of single-tenant industrial properties throughout the United States, today announced its financial and operating results for the third quarter of 2014.

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Third Quarter Highlights:

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����������������� Generated Core Funds from Operations (�Core FFO�) of $21.0 million compared to $17.5 million for the third quarter of 2013, an increase of 20%. This represents $0.36 per diluted share compared to $0.35 per diluted share in the third quarter of 2013, an increase of 3%. For the nine months ended September�30, 2014, Core FFO increased 23% in the aggregate and 9% on a diluted per share basis compared to the same period last year.

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����������������� Generated Adjusted Funds from Operations (�AFFO�) of $20.4 million compared to $17.6 million for the third quarter of 2013, an increase of 16%. For the nine months ended September�30, 2014, AFFO increased 26% in the aggregate compared to the same period last year.

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����������������� Increased monthly common dividend by 2.3% to $0.1125 per share commencing with the January 2015 dividend. The increase equates to an annual dividend of $1.35 per share, or a yield of 6.5% based on the quarter ended stock price of $20.71.

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����������������� Acquired 18 industrial buildings consisting of approximately 3.5 million square feet for $173.7 million.

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����������������� Achieved quarter end occupancy on the Company�s portfolio of 94.8%.

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����������������� Executed leases for approximately 629,000 square feet.

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����������������� Achieved a retention rate of 98.5% for leases expiring in the quarter.

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����������������� Raised gross proceeds of $44.7 million under the Company�s �At the Market� offering programs (�ATM�).

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����������������� Appointed Jeffrey M. Sullivan as Executive Vice President, General Counsel and Secretary, effective January�1, 2015.

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�A very strong quarter for the Company with record acquisition volume and strong leasing results,� said Ben Butcher, CEO of STAG. �We look forward to carrying the momentum established in the third quarter into our traditionally strong fourth quarter�s activity and on into 2015.�

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Acquisition Activity and Guidance

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During the three months ended September�30, 2014, the Company acquired 18 industrial buildings consisting of approximately 3.5 million square feet for $173.7 million. The acquired properties were 97.2% occupied at closing. Details of the acquired properties are shown in the chart below:

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THIRD QUARTER 2014 ACQUISITIONS

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During the nine months ended September�30, 2014, the Company acquired 31 industrial buildings consisting of approximately 6.6 million square feet for $292.7 million. The chart below reflects the acquisition activity during the nine months ended September�30, 2014:

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2014 ACQUISITION ACTIVITY

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Subsequent to quarter end, and through October�30, 2014, the Company acquired one industrial building consisting of 98,151 square feet for $6.2 million. This building was under contract as of September�30, 2014. As of October�30, 2014, the Company had entered into contracts to acquire 12 industrial buildings for $147.7 million. Included in the acquisitions under contract are three build-to-suit transactions, which are scheduled to close in the second quarter of 2015. The Company also executed non-binding letters of intent (�LOI�) to acquire five additional industrial buildings for $106.3 million. These contracts and LOIs are subject to various conditions, including the negotiation and execution of a definitive purchase and sale agreement with respect to the buildings subject to the LOIs, which have not yet been satisfied and there can be no assurance that the transactions will be consummated.

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As of October�30, 2014, the pipeline of potential acquisitions exceeded $1.4 billion and 112 industrial buildings. The pipeline is a point in time measure that includes all of the transactions under consideration by the Company�s acquisitions group that have passed the initial screening process. It also includes transactions under contract and transactions with non-binding LOIs.

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Inclusive of contracts executed but not yet closed, the Company has closed or committed to close a total of $446.6 million of acquisitions year-to-date. This exceeds the Company�s full year 2014 target of $325 million to $350 million of acquisitions, an amount that represented 25% growth in the Company�s December�31, 2013 real estate cost basis. In 2015, consistent with past years, the Company will target acquiring industrial buildings equal to 25% of the December�31, 2014 portfolio on a real estate cost basis.

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Leasing Activity

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During the three months ended September�30, 2014, the Company executed leases consisting of approximately 629,000 square feet. The leases signed are detailed below:

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THIRD QUARTER 2014 LEASING ACTIVITY

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(1)New leases consist of one new lease for 28,800 square feet and three leases, which are included in the renewal lease count, that added 45,600 square feet of new space at renewal.

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During the nine months ended September�30, 2014, the Company executed approximately 3.2 million square feet of leases of all types, comprised of 2.8 million square feet of renewal leases and 437,000 square feet of new leases. The chart below reflects the leasing activity:

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2014 LEASING ACTIVITY

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Six leases consisting of approximately 766,000 square feet expired in the third quarter and the tenant retention rate for these leases is 98.5%. The rental rate on the renewed leases expiring in the third quarter increased 3.5% on a cash basis and 7.5% on a GAAP basis. The tenant retention rate for the nine months ended September�30, 2014 is 69.0% as detailed in the chart below:

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2014 RETENTION RATES

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Subsequent to September�30, 2014, the Company has executed four leases consisting of 432,500 square feet.

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As of October�30, 2014, the Company had 11 leases in negotiation for approximately 1.2 million square feet. These negotiations are subject to various conditions which have not yet been satisfied and there can be no assurance that the transactions will be consummated.

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Portfolio Highlights

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The Company�s portfolio, inclusive of the new acquisitions, totaled approximately 44.5 million square feet as of September�30, 2014, representing an increase in square footage of 26% since September�30, 2013. Occupancy for the portfolio was 94.8% at the end of the quarter compared to 94.0% at end of the third quarter 2013. Year-over-year, same store occupancy decreased from 92.9% to 92.6%. Portfolio characteristics are detailed in the chart below:

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PORTFOLIO CHARACTERISTICS

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(1)�Excludes office buildings.

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The chart below details the Company�s tenant profile:

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TENANT PROFILE

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(1)Based on annualized rent and the inclusion of tenants, guarantors, and / or parents.

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Key Financial Measures

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Core FFO and AFFO for the third quarter were $21.0 million and $20.4 million, respectively. The Company believes that Core FFO and AFFO are useful supplemental measures of the Company�s operating performance as they provide a more meaningful and consistent comparison of the Company�s operating performance and allow investors to more easily compare the Company�s operating results.

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The Company continued its accretive growth of recurring operating income during the three months ended September�30, 2014, with Core FFO growing 20% as compared to the three months ended September�30, 2013 in the aggregate and 3% on a diluted, per share basis. AFFO also grew 16% over the same period. The Company�s key financial measures are noted in the chart below:

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KEY FINANCIAL MEASURES

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Net Income for the three months ended September�30, 2014 was $251,000. Included in Net Income is depreciation and amortization expense of $22.0 million. A reconciliation of Net Income to Cash Net Operating Income (�NOI�), adjusted earnings before interest, tax, depreciation and amortization (�Adjusted EBITDA�), Core FFO, FFO, and AFFO, all non-GAAP financial measures, appears at the end of this release.

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Capital Markets Activity, Liquidity and Financial Statistics

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As of September�30, 2014, the Company had $204.3 million of total liquidity comprised of $5.3 million of cash and $199.0 million of immediate availability on the Company�s unsecured credit facility and unsecured term loans. The Company also had $45.0 million of additional capacity on its unsecured facilities for future acquisitions, subject to customary terms and conditions.

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As of September�30, 2014, the Company�s enterprise value was approximately $2.1 billion comprised of $1.2 billion of equity market capitalization, $139.0 million of preferred equity and total debt of $678.2 million.

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During the three months ended September�30, 2014, Fitch Ratings assigned a �BBB-� rating, to STAG Industrial Operating Partnership L.P.�s $50 million, 12-year unsecured notes that closed during the quarter. Fitch Ratings also re-affirmed its �BBB-� rating for the Company and its operating partnership, with additional ratings as follows: senior unsecured: �BBB-�, and preferred equity: �BB�. Subsequent to September�30, 2014, Fitch Ratings assigned a �BBB-� rating to STAG Industrial Operating Partnership, LP�s $50 million, 10-year unsecured notes that were issued on October�1, 2014, and re-affirmed the above mentioned ratings.

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As of September�30, 2014, the Company had approximately $678.2 million of debt outstanding with aweighted average remaining term of 4.5 years and a weighted average interest rate of 3.6%. During the three months ended June�30, 2014, the Company executed a $100 million private placement of senior unsecured notes consisting of $50 million of 10-year notes and $50 million of 12-year notes. Borrowings under both tranches of notes bear interest at a fixed rate of 4.98%. The 12-year notes were issued on July�1, 2014 and the 10-year notes were issued on October�1, 2014. The chart below details the Company�s debt capital structure and financial ratios:

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DEBT CAPITAL STRUCTURE AND FINANCIAL RATIOS

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(1)�Annualized Adjusted EBITDA as defined at the end of this release.

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During the three months ended September�30, 2014, the Company issued 2.0 million shares of common stock under its ATM offering programs realizing net proceeds of $44.0 million. The Company has two ATM programs with a total of $200.8 million available. The chart below reflects the activity in the ATM programs for the nine months ended September�30, 2014:

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2014 ATM ACTIVITY

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Subsequent to quarter end, on October�20, 2014, the Company closed a marketed, overnight common stock offering of 6,325,000 shares, inclusive of underwriters� option to purchase additional shares, at a price of $21.20 per share. The Company raised gross proceeds of $134.1 million and net proceeds of $128.2 million. A significant number of the allocated shares were to new and existing large, dedicated REIT investors.

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Personnel

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On September�8, 2014, Kathryn Arnone, Executive Vice President, General Counsel and Secretary of the Company, notified the Company that she is resigning effective December�31, 2014. Ms.�Arnone has served in these capacities since the Company went public in 2011 and served as General Counsel to the Company�s predecessor business since 2006. Simultaneously, the Company announced the appointment of Jeffrey M. Sullivan, a partner at Hunton�& Williams LLP, by the Board of Directors to serve as Executive Vice President, General Counsel and Secretary of the Company, effective January�1, 2015. Mr.�Sullivan�s practice has focused on securities law, mergers and acquisitions, corporate governance matters and general corporate law, primarily involving REITs and other real estate companies, private equity funds and underwriters. Mr.�Sullivan has represented the Company since it initiated its efforts to become a public company.

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During the second and third quarter of 2014, three of the Company�s executive officers entered into standard 10b5-1 trading plans to diversify their personal assets. The trading plans meet the guidelines promulgated by the Board of Directors and eliminate officer discretion regarding the timing of sales. These programmatic sales represent the first sales of stock by any executive officer of the Company. All executive officers continue to hold significant ownership positions in the Company, well in excess of the

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stock ownership requirements established by the Board of Directors, and continue to receive a majority of their compensation in the form of Company equity. The Board of Directors supports these sale efforts.

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Dividends

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The Board of Directors declared an increase in the Company�s monthly common stock dividend from a rate of $0.11 per share to $0.1125 per share, commencing with the January�2015 dividend. The increase equates to an annual dividend of $1.35 per common share and represents an annual distribution rate of 6.5% based on the Company�s September�30, 2014 stock price of $20.71 per share. The record and payment dates for the 2014 fourth quarter and 2015 first quarter dividends are as follows:

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DIVIDENDS DECLARED

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The Company�s Board of Directors has declared a December�15, 2014 record date for the fourth quarter preferred stock dividends for its 9.0% Series�A Cumulative Redeemable Preferred Stock (NYSE: STAG Pr A) (�Series�A Preferred�) and its 6.625% Series�B Cumulative Redeemable Preferred Stock (NYSE: STAG Pr B) (�Series�B Preferred�). The Company confirmed that the dividend for the Series�A Preferred is $0.5625 per share, which equates to $2.25 per share on an annualized basis, and the dividend for the Series�B Preferred is $0.4140625 per share, which equates to $1.65625 per share on an annualized basis. Both preferred stock dividends will be payable on December�31, 2014.

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Conference Call

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The Company will host a conference call on Friday, October�31, 2014, at 11:00�a.m. (Eastern Time) to discuss the quarter�s results. The call can be accessed live over the phone toll-free by dialing (877) 407- 4018, or for international callers, (201) 689-8471. A replay will be available shortly after the call and can be accessed by dialing (877) 870-5176, or for international callers, (858) 384-5517. The passcode for the replay is 13591750. The replay will be available until November�7, 2014.

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Interested parties may also listen to a simultaneous webcast of the conference call by visiting the Investor Relations section of the Company�s website at www.stagindustrial.com, or by clicking on the following link:

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http://ir.stagindustrial.com/corporateprofile.aspx?iid=4263385

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Supplemental Schedules

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The Company has provided a supplemental information package to provide additional disclosure and financial information on its website (www.stagindustrial.com) under the �Presentations� tab in the Investor Relations section.

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Additional information is also available on the Company�s website at www.stagindustrial.com.

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CONSOLIDATED BALANCE SHEETS

STAG Industrial,�Inc.

(unaudited, $000s, except share data)

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CONSOLIDATED STATEMENTS OF OPERATIONS

STAG Industrial,�Inc.

(unaudited, $000s, except share data)

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RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

STAG Industrial,�Inc.

(unaudited, $000s, except share data)

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RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

STAG Industrial,�Inc.

(unaudited, $000s, except share data)

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