v3.26.1
Debt
 3 Months Ended
Mar. 31, 2026
Debt Disclosure [Abstract]  
Debt

Note 6. DEBT

Our balances for long-term debt and finance lease obligations were as follows (in thousands):

 

 

March 31,

 

 

December 31,

 

 

 

2026

 

 

2025

 

Credit Facility

 

$

682,000

 

 

$

692,295

 

Finance lease obligations

 

 

59,823

 

 

 

4,656

 

Total debt and finance lease obligations

 

 

741,823

 

 

 

696,951

 

Current portion

 

 

9,811

 

 

 

3,465

 

Noncurrent portion

 

 

732,012

 

 

 

693,486

 

Deferred financing costs, net

 

 

5,815

 

 

 

6,299

 

Noncurrent portion, net of deferred financing costs

 

$

726,197

 

 

$

687,187

 

 

As of March 31, 2026, future principal payments on debt and future minimum rental payments on finance lease obligations were as follows (in thousands):

 

 

 

Debt

 

 

Finance Lease Obligations

 

 

Total

 

2026

 

$

—

 

 

$

11,599

 

 

$

11,599

 

2027

 

 

—

 

 

 

6,208

 

 

 

6,208

 

2028

 

 

682,000

 

 

 

6,301

 

 

 

688,301

 

2029

 

 

—

 

 

 

6,395

 

 

 

6,395

 

2030

 

 

—

 

 

 

6,491

 

 

 

6,491

 

Thereafter

 

 

—

 

 

 

43,419

 

 

 

43,419

 

Total future payments

 

 

682,000

 

 

 

80,413

 

 

 

762,413

 

Less impact of discounting

 

 

—

 

 

 

20,590

 

 

 

20,590

 

Total future principal payments

 

 

682,000

 

 

 

59,823

 

 

 

741,823

 

Current portion

 

 

—

 

 

 

9,811

 

 

 

9,811

 

Long-term portion

 

$

682,000

 

 

$

50,012

 

 

$

732,012

 

The Credit Facility is secured by substantially all of the Partnership’s assets.

Letters of credit outstanding totaled $4.9 million at both March 31, 2026 and December 31, 2025.

Taking the interest rate swap contracts into account, the effective interest rate on our Credit Facility was 5.6% (with an applicable margin of 2.00%) at both March 31, 2026 and December 31, 2025. See Note 7 for additional information on our interest rate swap contracts.

As of March 31, 2026, we were in compliance with our financial covenants under the Credit Facility. The amount of availability under the Credit Facility at March 31, 2026, after taking into consideration debt covenant restrictions, was $238 million.

Cash paid for interest, including debt and finance lease obligations, amounted to $10.3 million and $12.4 million for the three months ended March 31, 2026 and 2025, respectively.

Finance Lease Obligations

In May 2012, the Predecessor Entity entered into a 15-year master lease agreement with renewal options of up to an additional 20 years with Getty. Since then, the agreement has been amended from time to time to add or remove sites. As of December 31, 2025, we leased 106 sites under this lease. We paid fixed rent, which increased 1.5% per year. In addition, the lease required variable lease payments based on gallons of motor fuel sold.

Because the fair value of the land at lease inception was estimated to represent more than 25% of the total fair value of the real property subject to the lease, the land element of the lease was analyzed for operating or capital treatment separately from the rest of the property subject to the lease. The land element of the lease was classified as an operating lease and all of the other property was classified as a capital lease. This assessment was not required to be reassessed upon adoption of ASC 842–Leases.

On January 31, 2026, we entered into an amendment of this lease with Getty. The amendment reset the rents for all 106 sites to an aggregate $6.9 million in annual rent, subject to annual escalations of 1.5%. The amendment also removed provisions requiring us to pay variable rent based on fuel volume.

Through this amendment, we also exercised a renewal option that extends the term through April 30, 2037 and have an additional renewal option that could extend the term through April 30, 2047. The amendment provides for a purchase option to us that can be exercised between October 1, 2026 and June 30, 2027 for up to 25 sites for up to $6.6 million, which is reasonably certain to be exercised. The amendment also provides for a purchase option to us for up to nine additional sites during certain timeframes of the term at values to be agreed upon, which is not reasonably certain to be exercised. Getty has the option to recapture up to six sites during certain timeframes of the term as well, which is also not reasonably certain to be exercised. We have a right of first offer should Getty seek to sell or convey any of the leased properties.

This amendment triggered a reassessment of the lease accounting. Effective January 31, 2026, we are accounting for the modified lease as a finance lease. With respect to the 25 sites for which it is reasonably certain we will exercise our purchase option and have the intent and ability to do so, we are accounting for the finance lease using an anticipated purchase date of October 1, 2026. With respect to the 81 remaining sites, we are accounting for the finance lease through the end of the current term expiring on April 30, 2037. The weighted-average discount rate for this finance lease obligation was 6.0% at March 31, 2026, which resulted in recording increases in our finance lease obligations and right-of-use assets under finance leases of $56.3 million during the first quarter of 2026. Interest on finance lease obligations amounted to $0.3 million and $0.1 million for the three months ended March 31, 2026 and 2025, respectively.