Good morning. Welcome to the 2020 Annual Meeting of Stockholders of Realty Income. My name is Mike McKee, and I'm the Non Executive Chairman of the Board of Directors. We're pleased you could be with us today. Our number one focus is the health and safety of our employees and our shareholders.
So thank you for participating virtually today as a result of concerns over the coronavirus situation. One of the hallmarks of Realty Income over its 25 plus years as a public company is a tremendous support of many of our shareholders who join us in person at our annual meetings. Our hope and expectation is that we can be together in person again next year. Please note that this meeting is being recorded. Today's meeting will be in 2 parts.
The first part of the meeting will be the formal portion where the required business will be handled. The second part will be more informal with a presentation on the company's operations and an opportunity to ask questions. I hereby call the 2020 Annual Meeting of Stockholders of Realty Income to order. I appoint Michael Pfeiffer, our Executive Vice President, Chief Administrative Officer and General Counsel to act as Secretary of the meeting and Cynthia Skoglund of Broadridge as Inspector of Elections to count the votes on any matters presented to this meeting or any adjournment thereof. Mr.
Pfeiffer, would you please advise this meeting as to the mailing of the notice of the annual meeting to stockholders and report on the presence of a quorum.
Thank you, Mr. Chairman. The Inspector of Elections has filed her oath of office with me. Also, I have received and am delivering for insertion into the company's records an affidavit of distribution from Joanne Vogel of Broadridge stating that a notice of annual meeting of stockholders was mailed, commenced on April 1 to all holders of common stock as of the record date, which was the close of business on March 12, 2020. There are presence in person or by proxy at this meeting, holders of approximately 88.33 percent of the outstanding shares of common stock of the corporation, which confirms the presence of a quorum.
Only holders of common stock as of the record date are entitled to notice of and to vote at the meeting.
So a quorum is present and this meeting is duly who are with us virtually today. Sumit Roy, our President and Chief Executive Officer Doctor. Kathleen Allen, Professor Emeritus at the Marshall School of Business and the Founding Director of the Center For Technology Commercialization at the University of Southern California. Doctor. Allen is a member of our audit committee.
Larry Chapman is the retired Executive Vice President and Head of Commercial Real Estate at Wells Fargo. Mr. Chapman is also a member of our Audit Committee. Reggie Gilliard is a Senior Advisor with the Boston Consulting Group. Mr.
Gilliard is Chairperson of our Nominating Corporate Governance Committee. Priya Cherian Huskins is Senior Vice President and a partner at Woodruff Sawyer and Co, a commercial insurance brokerage firm. Ms. Huskins is Chairperson of our Compensation Committee and is a member of our Nominating Corporate Governance Committee. Christy Kelly is a retired Global Chief Financial Officer of Jones Lang LaSalle Incorporated, a publicly traded financial and professional services firm specializing in real estate.
Ms. Kelly is a member of our Audit Committee. Jerry Lopez is operating partner with SoftBank. Mr. Lopez is a member of our compensation committee.
Greg McLaughlin is Chief Executive Officer of the World Golf Foundation and President of the First Tee. Mr. McLaughlin is a member of our audit and compensation committees. Ron Merriman is the retired Vice Chairman and partner of KPMG LLP, a global accounting and consulting firm. Mr.
Merriman is Chairperson of our Audit Committee and is a member of our Nominating Corporate Governance Committee. Also in attendance on this webcast are the following executive officers: Neil Abraham, Executive Vice President, Chief Strategy Officer Mark Hagan, Executive Vice President, Chief Investment Officer Ben Fox, Executive Vice President, Asset Management and Real Estate Operations. I'd also like to thank the following people for attending via the webcast today. William Clark, Co Founder and Retired Chairman of the Board and Joan Clark, Co Founder of Realty Income. Lionel DeChamps, Melody Stutzman and Blake McGinnis with KPMG, the company's independent auditors and Bill Sernias and Darren Guttenberg from Latham and Watkins, the company's Corporate Counsel.
Today, we have 3 items of business we must handle as part of the formal session. The first item of business is the election of 10 directors, each to hold office until the next annual meeting of stockholders and until his or her successor is duly elected and qualifies. The second item of business is the ratification of the appointment of our independent registered public accounting firm. The Audit Committee of our Board of Directors has selected KPMG LLP as the independent registered public accounting firm to audit the company's financial statements for the year ending December 31, 2020. The 3rd item of business is the non binding advisory vote to approve the compensation of our named executive officers.
At this time, we will entertain questions on any of these three proposals. If you have a question and have logged in using your control number, please submit your question now The polls will be open for voting by anyone who wishes to vote online with respect to these proposals. Are there any questions or comments on these proposals? As there are no questions related to the proposals, the polls are now open for voting on all matters to be presented. Any stockholder who hasn't yet voted or wishes to change his or her vote and has logged in using their control number may do so by clicking on the voting button
on
the bottom right of your web portal and following the instructions. Any stockholder who has sent in a proxy or voted via the telephone or Internet and does not want to change his or her vote does not need to take any further action. So I'll pause a moment to allow anyone that desires to follow those instructions. I did get a question online about why our audit fees increased almost 30%. And let me just address that.
That may be one that we address later or now, but I think now would be appropriate. Last year, as many of you know, the company made its first investment internationally into the United Kingdom. A lot of extraordinary work went into that because it was a strategic expansion for the company and a lot of coordination between the U. S. Auditing firm and the work done in the UK caused some increase in the fees.
Our fees go up with inflation, but frankly are very, very competitive and well monitored. And we're very pleased as a Board of Directors, both with the service we're getting, but also with the efficiency of that service and the cost. So seeing no further questions, I now declare the polls closed. At this time, we will pause for a minute to allow the Inspector of Elections to tally the votes and give the information to Mr. Pfeiffer.
Thank you, Mr. Chairman. The Inspector of Elections has advised me that the preliminary results are as follows. First, each of the 10 directors named in the proxy have been elected. 2nd, APMG has been ratified as the company's independent registered accounting firm for the year ending December 31, 2020.
3rd, the advisory vote to approve the compensation of Realty Income's named executive officers has been approved. The final tabulation results will be completed after the meeting and will be attached to the minutes of this meeting and will also be disclosed in the Form 8 ks, which will be filed with the Securities and Exchange Commission.
Congratulations, Doctor. Allen, Ms. Hopkins, Ms. Kelly, Messrs Chapman, Gilliard, Lopez, McLaughlin, Merriman and Roy. The stockholder meeting will now be concluded in its formal part.
At this time, we'll hold the more informal session. For that portion of today's meeting, Sumit will provide an overview of the company, our 2019 operating performance and the company's outlook for 2020. We'll then open the floor for questions. It is my pleasure to introduce Sumit Roy, our Chief Executive Officer to begin the presentation.
Thank you, Mike. Welcome to the informal portion of the Annual Meeting. We appreciate everyone joining us today virtually and thank you for your continued support of Realty Income. I would also like to thank the rest of my colleagues and our directors for their contributions to our company. This morning, I'd like to provide an overview of the company, then we'll open the meeting to questions, which can be submitted through the virtual webcast.
The company was founded in 1969, listed on the New York Stock Exchange in 1994 under the ticker O. Today, we are an S and P 500 company with a total market capitalization of approximately $25,000,000,000 Our mission is to pay monthly dividends that increase over time. We are proud to be a member of the S and P 500 Dividend Aristocrats Index for having increased our dividend every year for the past 25 years. We are one of only 8 REITs with at least 2 A credit ratings. We own over 6,500 properties, which are diversified by tenant, industry, geography and property type.
We had a strong year in 2019 investing over $3,700,000,000 in real estate properties and growing AFFO per share by 4.1%. This marked a record year for property level acquisitions and we completed our first ever international acquisition. In 2019, we invested nearly $800,000,000 internationally in the United Kingdom and our balance sheet remains conservatively capitalized with strong liquidity. We have a strong track record of providing favorable shareholder returns. We have generated a 14.6 percent compound average annual total shareholder return since our listing in 1994, significantly outperforming the broader major indices.
We managed the business with a focus on delivering favorable risk adjusted returns through a variety of economic environments. During the Great Recession, we were one of only 11 S and P 500 REITs with positive earnings growth, one of only 9 S and P 500 REITs without a dividend cut and 1 of only 5 S and P 500 REITs with positive total shareholder return. Our portfolio is very well diversified, primarily comprising of single tenant freestanding retail properties. Our largest component outside of retail is industrial properties at 10.7 percent of rent. We continue to selectively add non retail properties to our portfolio, primarily industrial properties.
Our portfolio is diversified by geography as we own properties in 49 States, Puerto Rico and the United Kingdom. We have excellent geographic diversification as no state represents more than 11% of rental revenue. Texas and California are our top 2 states in terms of rental revenue. We partner with leading operators in their respective industries. Our largest tenant is Walgreens, representing 6% of rental revenue.
Approximately 48% of rent is from investment grade rated tenants and our top 20 tenants represent just over half of rental revenue. Our conservative capital structure provides us financial flexibility and strong liquidity. In April, we drew $1,200,000,000 on our revolving credit facility, and last week we effectively completed a $600,000,000 bond offering, which further strengthens our financial position. We remain one of only a handful of REITs with at least 2A credit ratings. During times of economic uncertainty, we believe a strong financial position remains paramount.
In April, we declared the company's 598th consecutive monthly dividend, and in March, we increased the dividend for the 106th time. We're a proud member of the S and P 500 Dividend Aristocrats Index for having increased the dividend every year for the last 25 consecutive years. After all, we are the monthly dividend company. We continue the positive momentum from 2019 into our Q1 of 2020 as we reported strong results last week. During the Q1 of 2020, we completed $486,000,000 of high quality acquisitions and balanced the quarter with portfolio occupancy of 98.5 percent.
Our balance sheet remains strong as we ended the quarter with a net debt to adjusted EBITDA ratio of 5 times. We are committed to being a respected corporate citizen and conducting our business according to the highest ethical standards. We are dedicated to providing an engaging, diverse and safe work environment for our employees, operating our business in an environmentally conscious manner and upholding our corporate responsibilities as a public company for the benefit of all stakeholders, which includes our shareholders, clients, colleagues and community. In 2019, we established a sustainability department and are proud to continue growing these important initiatives. We received many questions regarding the impact to the business of the COVID-nineteen pandemic.
We believe we entered the current environment of economic uncertainty well positioned, And we continue to manage the business with a focus on providing favorable risk adjusted returns to our shareholders over the long term. Through May 1, we had collected approximately 83% of contractual rent for April. We are in rent deferral discussions for the majority of unpaid rent in April. We are pleased that most requests for rent relief have been for rent deferrals rather than rent abatement. We received essentially all rent from investment grade rated tenants and we will continue to review requests for rent deferral on a case by case basis to support mutually beneficial outcomes.
Our top 4 industries, convenience stores, drug stores, dollar stores and grocery stores, each sell essential goods and we received substantially all rent from operators in these industries. We are proud to partner with leading operators in these industries as each of these industries is playing an important role supporting consumers through the current environment of uncertainty. Certain industries remain challenged in the short term due to the social distancing requirements and changes in consumer behavior. Of the 17% of rent not collected in April, approximately 86% was from operators in the theater, health and fitness, restaurant and childcare industries. Theatres remain closed due to the COVID-nineteen pandemic.
We are pleased to partner with leading operators in the theater industry as most of our exposure is with AMC and Regal. The success of the theater industry has largely been tied to the quality of films produced by Hollywood and the U. S. Box office reached an all time high as recent as 2018. Additionally, the economic business model for studios continues to suggest in our view, that the theater distribution channel should remain attractive going forward.
Health and fitness has also been disproportionately impacted. Our exposure is primarily with Lifetime Fitness and LA Fitness, and we believe top operators will withstand short term setbacks. Once social distancing requirements are lifted, we expect gyms to recover. Restaurants remain open for delivery and takeout, but sales have declined as dine in options are closed. Most of our restaurant exposure is with quick service restaurants such as Taco Bell and the propensity of drive through orders supports revenue generation.
We enter the current environment of economic uncertainty well positioned with a conservative capital structure with ample liquidity, a defensive real estate portfolio leased to leading operators and an experienced team focused on generating long term value for stakeholders. With that, we'll open it up for questions. We have received several questions regarding the safety of the dividend, particularly given the economic uncertainty associated with COVID-nineteen. 1 of the core pillars of our company's mission continues to be to provide dependable and growing dividends to our shareholders. And we continue to view this as a top priority for the company and expect this track record of consistent dividend growth to continue moving forward.
Earlier this year, we were proud to be added to the S and P 500 Dividend Aristocrats Index for having increased our dividend for 25 consecutive years. Last month, we declared the 598th consecutive common stock monthly dividend, and in March, we increased the dividend for the 106 time. During the Great Recession, we were one of only 9 S and P 500 REITs that didn't cut the dividend, and we are better positioned today than 10 years ago. Our portfolio is stronger than it was during the Great Recession with almost half of rent generated from investment grade rated tenants with strong balance sheets and leading market positions in their respective industries. Our balance sheet is well positioned with coverage ratios at the highest level in our company's history.
Our dividend remains well covered with an AFFO payout ratio of approximately 80% in 2019. As a monthly dividend company, our goal is to continue providing shareholders with dependable monthly dividends that increase over time. We will now pass to allow for additional questions. One of the questions asked is, have any executives voluntarily taken a pay cut to help with cash flow? We have not yet done anything on that particular with that particular area of our compensation.
As you know, most of our compensation is largely tied to the performance of the business. And given the COVID-nineteen situation and given the formulaic nature of our compensation, most of the executives are going to expect to be impacted negatively. But as of right now, we haven't voluntarily taken a pay cut because we don't believe that that is warranted. The next question we have is, what do you think the next 5 years hold for the future of standalone retail? That's a very good question.
There was a question along similar lines asked last week during our earnings call, where somebody asked us, would we have done things differently had we anticipated a downturn? And the question the answer was that we were in the midst of one of the longest recoveries that the United States has ever seen, almost over 10 years. And we were expecting a downturn. We just didn't know what would cause the downturn. And pandemic where businesses would go from pre crisis revenues of X to 0 literally overnight was not something that we had anticipated.
And one of the things that the team has discussed internally is, had we known that the businesses would have gone from X to 0 overnight, would we have done things differently? And the answer is yes. But we would we also need to not over index our thought process given a pandemic driven downturn, because the businesses that have been most impacted due to social distancing like theaters and gyms did remarkably well on a relative basis during the last great recession. Theatres continue to be one of the cheapest forms of entertainment and our belief continues to be today that though there will be some level of real estate rationalization, theaters in its current form will exist in the future. Will the window for concurrent releases potentially be shortened from 90 days to potentially 60 days or even less, 45 days?
Probably. Will there be fewer theaters? Possibly. But will theaters continue to be one of the primary forms of distribution? We believe that it will continue to be such.
And though it will take a little bit longer for the theater business to recover, we believe that it will recover. Gyms, on the other hand, we believe that especially the younger demographic will allow gyms to recover much faster than the Tiara business. And yes, the certain demographics will choose to wait till we have a vaccine before they start to go back to gyms, etcetera. But we do believe that gyms are going to rebound much faster. There will be a place for retail.
I don't believe that we are going to go into a world where 100% of all of our retail purchases are going to be done online. We are still social animals and we believe that as long as we choose the right retail subsectors to invest in and the right formats to invest in with the right operators, there will be a place for retailers to continue to thrive. Does Realty Income own any Cheesecake Factories is another question that has been asked, and the answer is no, we don't. Another question we've received is why did you choose the UK for the first we looked from a macro perspective and essentially looked at countries through a variety of filters. And we chose the UK primarily driven by its similarities to the U.
S. We also felt like some of the businesses that we wanted to invest in such as the grocery business was very well developed in the UK and had in some ways dealt with a lot of what the grocers here in the U. S. Are dealing with today had already had a chance to deal with it. They had gone through competing with discount retailers like Aldi and Little and had been able to establish their market share and their margins.
They had they were also much further ahead on the online click and collect part of their business or their omnichannel strategy. And that too allowed us to get very comfortable with that particular area of the business. And seeing how well established the grocery business was in the UK, we chose to go there. And a similar filtering will be utilized to identify other geographies for us to expand into. Can you share the amount of and details on arrangement for rent relief, I.
E. Half rent, abatements for how long and repayment terms and how much of a cash flow hit? A lot of these were addressed in the call last week. Like we said, 17% of the rents were not collected for the month of April. 86% of those were largely driven by the 4 industries that we highlighted in an attempt to answer one of the previously.
And most of the discussions that we've had with requests for rent negotiations has been along the lines of deferment. The range of deferments have been anywhere between 2 to 3 months and the payback period is anywhere between 9 to 10 months. And like I said, almost 90% of what's being requested has been deferment, not an abatement. So from a cash flow perspective, there has been very little modifications made to leases. The payback period happens to be on in the original lease term.
And our belief is that the collectability, the probability of collectability is about 75 percent. So from a cash flow perspective and an accounting perspective, it's not going to have much of an impact. What percent of restaurant holdings are fast food outlets like Taco Bell and KFC, whose business will be less impacted than dining only restaurants? That's a very good question. 9% of our portfolio is dedicated to restaurants, of which 6% is quick service restaurants and only 3% happens to be casual dining.
And so, if you look at the profile of quick service restaurants, most of their businesses were impacted to the tune of about 10% to 20% with regards to their revenue line, if you were to consider post crisis revenue versus pre crisis revenue, whereas restaurant businesses were impacted to the tune of about 60% to 70% as compared to pre crisis revenue. So quick service restaurants have held up very well and they continue to perform well even in our portfolio. Over 82% of them have paid their rent to us, whereas 52% on the rest on the casual dining side paid rent. Okay. As there are no additional questions, we thank you for your continued support of our company.
At this point, I'll declare our annual meeting adjourned. Thank you.