moderate - Necessity-based retail tenants (convenience stores, QSRs, dollar stores) demonstrate relative recession resilience compared to discretionary retail, but tenant bankruptcies and rent coverage ratios deteriorate during economic downturns. Consumer spending patterns affect tenant sales volumes and ability to meet lease obligations. However, long-term triple-net leases (10-12 year WALT) provide cash flow stability through economic cycles, with limited near-term lease rollover risk.

Rising interest rates negatively impact NETSTREIT through multiple channels: (1) higher cost of debt reduces acquisition spreads and AFFO growth, (2) REIT valuations compress as dividend yields become less attractive relative to risk-free rates, (3) cap rate expansion reduces property values and limits accretive acquisition opportunities. The company's unsecured debt structure and moderate leverage (0.78 D/E) provide some flexibility, but net lease REITs are highly rate-sensitive given their bond-like cash flow profiles. A 100bp rate increase typically compresses REIT multiples by 10-15%.

dividend - Net lease REITs attract income-focused investors seeking stable, predictable dividend streams with modest growth (4-6% annual AFFO growth target). The 6.6% FCF yield and triple-net lease structure appeal to investors prioritizing current income over capital appreciation. Growth component comes from external acquisition-driven expansion rather than organic same-store growth, making it a 'dividend growth' rather than pure growth story.