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# Agree Realty CEO Takes 'Full Accountability' For 2023 Misstep: 'The Volume Game In Net Lease Is Over'
- URL: https://www.bullished.co/agree-realty-ceo-takes-full-accountability-for-2023-misstep-the-volume-game-in-net-lease-da7ff363/
- Published: 2026-10-21T14:16:16.000Z
- Updated: 2026-10-21T14:16:16.000Z
- Description: Joey Agree says the REIT is now killing deals that miss its thresholds, after cutting 2026 investment guidance to about $1.6 billion.
- Author: Matteo Parrino
- Tags: Earnings, ADC, Industry: Real Estate

[Agree Realty](https://www.bullished.co/tag/adc/) CEO Joey Agree said on the company's third-quarter earnings call that he did not move "quickly and decisively enough" when rates spiked in 2023, and that the REIT is now putting [returns ahead of deal volume](https://wtop.com/national/2026/10/agree-realty-q3-earnings-snapshot/?ref=bullished.co). Answering a Wells Fargo analyst, he said: "I think the volume game in net lease is over."

## What Agree said about 2023

Asked by the Wells Fargo analyst what he learned from the 2023 climb in the 10-year Treasury yield, Agree said the company kept using its balance sheet at spot pricing instead of waiting. He called that a "lack of discipline" and said, "I'll take the full accountability for that."

He said hope of normalization led him to stay the course on the existing pipeline then. This time, with $2 billion of liquidity and leverage of 3.8 times, he said the company moved immediately, and that the move was "aggressive."

Agree told a BMO Capital Markets analyst the approach is "take it or leave it." The company will kill a deal if it misses a certain threshold, he said, and a seller willing to move with the 10-year Treasury and the company's stock price could still transact.

## The numbers behind the shift

The company lowered its 2026 investment volume guidance to approximately $1.6 billion by culling lower-yield deals and repricing its pipeline, Agree said. Acquisition cap rates, the initial yield on a purchase, rose 30 basis points to 7.3% in the third quarter. He said he assumed another 25 basis points in the fourth quarter, and that the company would sell about $200 million more of property, mostly to tax-motivated buyers.

CFO Peter said elevated dead-deal costs cut third-quarter AFFO (adjusted funds from operations) per share by roughly a penny, and expects normalization in the fourth quarter. Core FFO and AFFO per share [were each $1.15](https://wtop.com/national/2026/10/agree-realty-q3-earnings-snapshot/?ref=bullished.co), up 4.9% from a year earlier, and full-year AFFO per share guidance rose to $4.58 to $4.59.

Peter said net debt to recurring EBITDA was about 3.9 times pro forma for settling all outstanding forward equity, versus 4.8 times excluding it. Liquidity was about $2 billion, and no material debt matures until 2028\. Agree said the company raised $1.1 billion this year, including forward equity at about $75 per share.

## What to watch

Agree said fourth-quarter cap rates will expand materially and that investment-grade share of acquisitions, which fell to 52.1% in the third quarter from 73% plus in the second, will "pop back up." He said the 2027 outlook of mid-single-digit AFFO growth per share assumes no further cap rate expansion.

Agree said he has not yet begun sourcing deals for 2027, so the fourth-quarter cap rate print is the next test of the repricing.

### Sources

- [Agree Realty: Q3 Earnings Snapshot – WTOP News](https://wtop.com/national/2026/10/agree-realty-q3-earnings-snapshot/?ref=bullished.co) — wtop.com
- [Agree Realty Q3 earnings beat, revenue misses as leasing activity increases (ADC:NYSE) | Seeking Alpha](https://seekingalpha.com/news/4654878-agree-realty-q3-earnings-beat-revenue-misses-as-leasing-activity-increases?ref=bullished.co) — seekingalpha.com
- [Agree Realty (ADC) Beats Q3 FFO and Revenue Estimates](https://finance.yahoo.com/real-estate/articles/agree-realty-adc-beats-q3-202002897.html?.tsrc=rss&ref=bullished.co) — Yahoo Finance
- [Agree Realty FFO of $1.15 beats by $0.02, revenue of $213.88M beats by $0.95M (ADC:NYSE) | Seeking Alpha](https://seekingalpha.com/news/4654887-agree-realty-ffo-of-1%5F15-beats-by-0%5F02-revenue-of-213%5F88m-beats-by-0%5F95m?ref=bullished.co) — seekingalpha.com
- [Baird Maintains Outperform on Agree Realty, L...](https://www.benzinga.com/news/26/10/62489661/baird-maintains-outperform-agree-realty-lowers-price-target-76?ref=bullished.co) — benzinga.com

### More on Agree Realty

- [Agree Realty Ends Quarter With Zero Commercial Paper After $400 Million Ten-Year Bond Sale](https://www.bullished.co/agree-realty-ends-quarter-with-zero-commercial-paper-after-400-million-ten-year-bond-sale-e3368ba1/)
- [Agree Realty Lifts Low End Of 2026 AFFO Guidance To $4.58–$4.59 As Third-Quarter Net Income Rises 32.3%](https://www.bullished.co/agree-realty-lifts-low-end-of-2026-affo-guidance-to-4-58-4-59-as-third-quarter-net-income-25a37051/)
- [Agree Realty Files Third-Quarter Share Count Ahead Of Earnings, Showing About 124.6 Million Diluted Shares](https://www.bullished.co/agree-realty-files-third-quarter-share-count-ahead-of-earnings-showing-about-124-6-million-6cfec2a6/)

[All Agree Realty (ADC) coverage →](https://www.bullished.co/tag/adc/)