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Equity Incentive Plans (Tables) | 3 Months Ended
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Mar. 31, 2025
Share-Based Payment Arrangement, Noncash Expense [Abstract] |
Summary Of Nonvested Share Activity | A summary of the Company’s nonvested share activity and related information is as follows:
| Number of shares |  | Weighted avg. grant date fair value |  | Weighted avg. life remaining
Outstanding at December 31, 2024 | 614,614 |  |  | $ | 42.79 |  |  |
Granted | 283,494 |  |  | 50.21 |  |  |
Vested | (265,675) |  |  | 43.37 |  |  |
Outstanding at March 31, 2025 | 632,433 |  |  | $ | 45.87 |  |  | 1.57
The holders of nonvested shares have voting rights and receive dividends from the date of grant. The fair value of the nonvested shares that vested was $11.8 million and $13.7 million for the three months ended March 31, 2025 and 2024, respectively. Expense recognized related to nonvested shares and included in "General and administrative expense" in the accompanying consolidated statements of income and comprehensive income was $1.9 million and $1.8 million for the three months ended March 31, 2025 and 2024, respectively. Expense related to nonvested shares and included in retirement and severance expense in the accompanying consolidated statements of income and comprehensive income was $0.7 million for the three months ended March 31, 2024. At March 31, 2025, unamortized share-based compensation expense related to nonvested shares was $16.9 million. Nonvested Performance Share Units A summary of the Company's nonvested performance share unit activity and related information is as follows:
| Target Number of Performance Share Units |  | Weighted avg. grant date fair value (1)
Outstanding at December 31, 2024 | 326,469 |  |  | $ | 59.44 |
Granted | 113,833 |  |  | 66.45 |
Vested (2) | (98,610) |  |  | 72.63 |
Outstanding at March 31, 2025 | 341,692 |  |  | $ | 57.97 |
(1) The grant date fair value was determined utilizing (i) a Monte Carlo simulation model to generate an estimate of the Company's future stock price over the three-year performance period for performance share units based on the Company's Total Shareholder Return (TSR) performance further described below and (ii) the Company's grant date fair value for performance share units based on the Company's estimated Compounded Annual Growth Rate (CAGR) in AFFO per share over the three-year performance period. (2) The achievement of the performance conditions for the performance share units granted during the year ended December 31, 2022 resulted in a performance payout percentage of 200% for both the Company's TSR relative to the TSRs of the Company's peer group companies and the Company's TSR relative to the TSRs of companies in the MSCI US REIT Index and a payout percentage of 200% for the Company's CAGR in AFFO per share over the three-year performance period. The achievement of the performance conditions and the above payout percentages resulted in the issuance of 197,220 common shares and 51,612 common shares from dividend equivalents. The fair value of the performance share units and dividend equivalents that vested was $12.3 million. The number of common shares issuable upon settlement of the performance share units granted during the three months ended March 31, 2025, 2024 and 2023 will be based upon the Company's achievement level relative to performance measures at December 31, 2027, 2026 and 2025, respectively. The performance share units accrue dividend equivalents that are paid as additional common shares based on the Company's achievement levels and upon settlement of the performance share units. The Company's achievement level relative to the performance measures is assigned a specific payout percentage, which is multiplied by a target number of performance share units.
Granted during the years ended December 31, | TSR vs. Triple-Net Peer Group | TSR vs. MSCI US REIT Index | CAGR in AFFO per share growth
2023 | 50.0 | % | 25.0 | % | 25.0 | %
2024 | 52.2 | % | 26.1 | % | 21.7 | %
2025 | 52.2 | % | 26.1 | % | 21.7 | %
The performance share units based on relative TSR performance have market conditions and are valued using a Monte Carlo simulation model on the grant date, which resulted in a grant date fair value of approximately $6.3 million and $4.1 million for the three months ended March 31, 2025 and 2024, respectively. The estimated fair value is amortized to expense over the three-year performance periods, which end on December 31, 2027, 2026 and 2025 for performance share units granted in 2025, 2024 and 2023, respectively. The following assumptions were used in the Monte Carlo simulation for computing the grant date fair value of the performance share units with a market condition for the three months ended March 31, 2025: risk-free interest rate of 4.2%, volatility factors in the expected market price of the Company's common shares of 25% and an expected life of approximately three years. The performance share units based on growth in AFFO per share have a performance condition. The probability of achieving the performance condition is assessed at each reporting period. If it is deemed probable that the performance condition will be met, compensation cost will be recognized based on the closing price per share of the Company's common stock on the date of the grant multiplied by the number of awards expected to be earned. If it is deemed that it is not probable that the performance condition will be met, the Company will discontinue the recognition of compensation cost and any compensation cost previously recorded will be reversed. At March 31, 2025, achievement of the performance condition was deemed probable for the performance share units granted during the three months ended March 31, 2025 with an expected payout percentage of 119%, which resulted in a grant date fair value of approximately $1.5 million. Achievement of the performance condition for the performance share units granted during the three months ended March 31, 2024 and 2023 was deemed not probable at March 31, 2025. Expense recognized related to performance share units and included in "General and administrative expense" in the accompanying consolidated statements of income and comprehensive income was $1.4 million and $1.5 million for the three months ended March 31, 2025 and 2024, respectively. Expense related to performance share units and included in retirement and severance expense in the accompanying consolidated statements of income and comprehensive income was $0.9 million for the three months ended March 31, 2024. At March 31, 2025, unamortized share-based compensation expense related to nonvested performance share units was $10.7 million.
Summary Of Restricted Share Unit Activity | A summary of the Company’s restricted share unit activity and related information is as follows:
| Number of shares |  | Weighted avg. grant date fair value |  | Weighted avg. life remaining
Outstanding at December 31, 2024 | 45,410 |  |  | $ | 40.69 |  |  |
Granted | 1,564 |  |  | 47.67 |  |  |
Vested | — |  |  | — |  |  |
Outstanding at March 31, 2025 | 46,974 |  |  | $ | 40.92 |  |  | 0.17

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- Definition Tabular disclosure of the changes in outstanding nonvested shares. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480429/718-10-50-2 + Details
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- Definition Disclosure of the number and weighted-average grant date fair value for restricted stock and restricted stock units that were outstanding at the beginning and end of the year, and the number of restricted stock and restricted stock units that were granted, vested, or forfeited during the year. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480429/718-10-50-2 + Details
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