Edgar Filing: GETTY REALTY CORP /MD/

(State or other jurisdiction of incorporation or organization)

(I.R.S. employer identification no.)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K


þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	FOR THE FISCAL YEAR ENDED DECEMBER 31, 2009

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER 001-13777

GETTY REALTY CORP.

(Exact name of registrant as specified in its charter)


125 Jericho Turnpike, Suite 103, Jericho, New York		11753

(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (516) 478-5400

Securities registered pursuant to Section 12(b) of the Act:


TITLE OF EACH CLASS		NAME OF EACH EXCHANGE ON WHICH REGISTERED

Common Stock, $0.01 par value		New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

None

(Title of Class)

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes o No o

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes o No þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.
Yes o No þ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yesþ No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer o	Accelerated filer þ	Non-accelerated filer o	Smaller reporting company o
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ

The aggregate market value of common stock held by non-affiliates (17,324,093 shares of common stock) of the Company was $326,905,635 as of June 30, 2009.

The registrant had outstanding 24,766,426 shares of common stock as of March 16, 2010.

DOCUMENTS INCORPORATED BY REFERENCE


DOCUMENT		PART OF FORM 10-K

Selected Portions of Definitive Proxy Statement for the 2010 Annual Meeting of Stockholders (the “Proxy Statement”), which will be filed by the registrant on or prior to 120 days following the end of the registrant’s year ended December 31, 2009 pursuant to Regulation 14A.		III

TABLE OF CONTENTS


Item	Description	Page


	Cautionary Note Regarding Forward-Looking Statements	2

	PART I

1	Business	4
1A	Risk Factors	8
1B	Unresolved Staff Comments	20
2	Properties	20
3	Legal Proceedings	23

	PART II

5	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	27
6	Selected Financial Data	29
7	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
7A	Quantitative and Qualitative Disclosures About Market Risk	48
8	Financial Statements and Supplementary Data	50
9	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	81
9A	Controls and Procedures	81
9B	Other Information	81

	PART III

10	Directors, Executive Officers and Corporate Governance	82
11	Executive Compensation	83
12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	83
13	Certain Relationships and Related Transactions, and Director Independence	83
14	Principal Accountant Fees and Services	83

	PART IV

15	Exhibits and Financial Statement Schedules	84

	Signatures	94
	Exhibit Index	95

iii

Cautionary Note Regarding Forward-Looking Statements

Certain statements in this Annual Report on Form 10-K may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. When we use the words “believes,” “expects,” “plans,” “projects,” “estimates,” “predicts” and similar expressions, we intend to identify forward-looking statements. (All capitalized and undefined terms used in this section shall have the same meanings hereafter defined below in this Annual Report on Form 10-K.) Examples of forward-looking statements include, but are not limited to, statements regarding: our primary tenant, Marketing, and the Marketing Leases included in “Item 1A. Risk Factors” and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Marketing and the Marketing Leases” and elsewhere in this Annual Report on Form 10-K; our belief that our network of retail motor fuel and convenience store properties and terminal properties are unique and not readily available for purchase or lease from other owners or landlords; our belief regarding the difficulty of obtaining the permits necessary to operate a network of petroleum marketing properties such as ours; future acquisitions and their impact on our financial performance; compliance with federal, state and local provisions enacted or adopted pertaining to environmental matters; our estimates and assumptions regarding the Marketing Environmental Liabilities; the impact of any modification or termination of the Marketing Leases on our business and ability to pay dividends or our stock price; our ability to predict if Marketing will continue to be dependent on financial support from Lukoil to meet its obligations as they become due through the terms of the Marketing Leases, that it is probable that Lukoil will continue to provide financial support to Marketing in the future and that Lukoil will not allow Marketing to fail to perform its rental, environmental and other obligations under the Marketing Leases; our belief that it is not probable that Marketing will not pay for substantially all of the Marketing Environmental Liabilities; our belief that Marketing is exiting the direct-supplied retail gasoline business by entering into subleases with petroleum distributors; our belief that Marketing is seeking subtenants for other significant portions of the portfolio of properties it leases from us; our decision to attempt to negotiate with Marketing for a modification of the Marketing Leases which removes certain properties from the Marketing Leases; our ability to predict if, or when, the Marketing Leases will be modified or terminated, the terms of any such modification or termination or what actions Marketing and Lukoil will take and what our recourse will be whether the Marketing Leases are modified or terminated or not; our belief that it is not probable that we will not collect the deferred rent receivable related to the properties subject to the Marketing Leases other than the deferred rent receivable related to the three hundred fifty properties we identified as being the most likely to be removed from the Marketing Leases; the expected effect of regulations on our long-term performance; our expected ability to maintain compliance with applicable regulations; our ability to renew expired leases; the adequacy of our current and anticipated cash flows from operations, borrowings under our Credit Agreement and available cash and cash equivalents; our ability to re-let properties at market rents or sell properties; our ability to maintain our federal tax status as a real estate investment trust (“REIT”); the probable outcome of litigation or regulatory actions and its impact on us; our belief that Marketing or other counterparties are responsible for certain environmental remediation costs; our expected recoveries from underground storage tank funds; our exposure and liability due to environmental remediation costs; our estimates and assumptions regarding remediation costs; our belief that our accruals for environmental litigation matters were appropriate based on information then currently available; our expectations as to the long-term effect of environmental liabilities on our business, financial condition, results of operations, liquidity, ability to pay dividends and stock price; our exposure to interest rate fluctuations and the manner in which we expect to manage this exposure; the expected reduction in interest-rate risk resulting from our interest rate Swap Agreement and our expectation that we will not settle the interest rate Swap Agreement prior to its maturity; our expectation as to our continued compliance with the financial covenants in our Credit Agreement and our Term Loan Agreement and that the Credit Agreement will be refinanced with variable interest-rate debt at its maturity; our expectations regarding corporate level federal income taxes; the indemnification obligations of the Company and others; our assessment of the likelihood of future competition; our beliefs regarding our insurance coverage; our belief that Marketing had removed, or has scheduled removal of the gasoline tanks and related equipment at approximately one hundred fifty, or 18%, of our properties and our beliefs that most of these properties are either vacant or provide negative or marginal contribution to Marketing’s results; assumptions regarding the future applicability of our accounting estimates, assumptions and policies; our intention to pay future dividends and the amounts thereof; and our beliefs about the reasonableness of our accounting estimates, judgments and assumptions including the estimated net sales value we expect to receive on the properties where we reduced the carrying amount of the properties during 2009.

These forward-looking statements are based on our current beliefs and assumptions and information currently

available to us, and involve known and unknown risks (including the risks described below in “Item 1A. Risk Factors” and other risks that we describe from time to time in our other filings with the SEC, uncertainties and other factors which may cause our actual results, performance and achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements.

These risks include, but are not limited to risks associated with: owning and leasing real estate generally; adverse developments in general business, economic or political conditions; material dependence on Marketing as a tenant; the impact of Marketing’s announced restructuring of its business; our inability to provide access to financial information about Marketing; the modification or termination of the Marketing Leases; Marketing paying its environmental obligations or changes in our assumptions for environmental liabilities related to the Marketing Leases; competition for properties and tenants; performance of our tenants of their lease obligations, tenant non-renewal and our ability to re-let or sell vacant properties; the effects of taxation and change to other applicable standards or regulations; potential exposure related to pending lawsuits and claims; costs of completing environmental remediation and of compliance with environmental legislation and regulations; our exposure to counterparty risk and our ability to effective manage or mitigate this risk; owning real estate primarily concentrated in the Northeast and Mid-Atlantic regions of the United States; substantially all of our tenants depending on the same industry for their revenues; potential future acquisitions; losses not covered by insurance; the impact of our electing to be treated as a REIT under the federal income tax laws, including subsequent failure to qualify as a REIT; our dependence on external sources of capital; generalized credit market dislocations and contraction of available credit; our business operations generating sufficient cash for distributions or debt service; changes in interest rates and our ability to manage or mitigate this risk effectively; our potential inability to pay dividends; changes to our dividend policy; changes in market conditions; adverse affect of inflation; the loss of a member or members of our management team; the uncertainty of our estimates, judgments and assumptions associated with our accounting policies and methods; and terrorist attacks and other acts of violence and war.

As a result of these and other factors, we may experience material fluctuations in future operating results on a quarterly or annual basis, which could materially and adversely affect our business, financial condition, operating results or stock price. An investment in our stock involves various risks, including those mentioned above and elsewhere in this report and those that are described from time to time in our other filings with the SEC.

You should not place undue reliance on forward-looking statements, which reflect our view only as of the date hereof. We undertake no obligation to publicly release revisions to these forward-looking statements that reflect future events or circumstances or reflect the occurrence of unanticipated events.

PART I

Item 1. Business

Overview

Getty Realty Corp., a Maryland corporation, is the largest publicly-traded real estate investment trust (“REIT”) in the United States specializing in the ownership and leasing of retail motor fuel and convenience store properties and petroleum distribution terminals. As of December 31, 2009, we owned nine hundred ten properties and leased one hundred sixty-one additional properties. Our properties are located primarily in the Northeast and the Mid-Atlantic regions in the United States. The Company also owns or leases properties in Texas, North Carolina, Hawaii, California, Florida, Arkansas, Illinois, Ohio, and North Dakota.

Nearly all of our properties are leased or sublet to distributors and retailers engaged in the sale of gasoline and other motor fuel products, convenience store products and automotive repair services. These tenants are responsible for managing the operations conducted at these properties and for the payment of taxes, maintenance, repair, insurance and other operating expenses related to our properties. Our tenants’ financial results are largely dependent on the performance of the petroleum marketing industry, which is highly competitive and subject to volatility. As of December 31, 2009, we leased approximately 78% of our one thousand seventy-one owned and leased properties on a long-term triple-net basis to Getty Petroleum Marketing Inc. (“Marketing”). Marketing is wholly-owned by a subsidiary of OAO LUKoil (“Lukoil”), one of the largest integrated Russian oil companies. Marketing operates the petroleum distribution terminals but typically does not itself directly operate the retail motor fuel and convenience store properties it leases from us. Rather, Marketing generally subleases our retail properties to subtenants that either operate their gas stations, convenience stores, automotive repair services or other businesses at our properties or are petroleum distributors who may operate our properties directly and/or sublet our properties to the operators. (For information regarding factors that could adversely affect us relating to our lessees, including our primary tenant, Marketing, see “Item 1A. Risk Factors”. For additional information regarding the portion of our financial results that are attributable to Marketing, see Note 11 in “Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements.” For additional information regarding Marketing and the Marketing Leases (as defined below), see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing Leases”.)

We are self-administered and self-managed by our experienced management team, which has over one hundred-two years of combined experience in owning, leasing and managing retail motor fuel and convenience store properties. Our executive officers are engaged exclusively in the day-to-day business of the Company. We administer nearly all management functions for our properties, including leasing, legal, data processing, finance and accounting. We have invested, and will continue to invest, in real estate and real estate related investments, such as mortgage loans, when appropriate opportunities arise.

The History of Our Company

Our founders started the business in 1955 with the ownership of one gasoline service station in New York City and combined real estate ownership, leasing and management with service station operation and petroleum distribution. We held our initial public offering in 1971 under the name Power Test Corp. We acquired, from Texaco in 1985, the petroleum distribution and marketing assets of Getty Oil Company in the Northeast United States along with the Getty® name and trademark in connection with our real estate and the petroleum marketing business in the United States. We became one of the largest independent owner/operators of petroleum marketing assets in the country, serving retail and wholesale customers through a distribution and marketing network of Getty® and other branded retail motor fuel and convenience store properties and petroleum distribution terminals.

Marketing was formed to facilitate the spin-off of our petroleum marketing business to our shareholders which was completed in 1997 (the “Spin-Off”). At that time, our shareholders received a tax-free dividend of one share of common stock of Marketing for each share of our common stock. Following the Spin-Off, Marketing held the assets and liabilities of our petroleum marketing operations and a portion of our home heating oil business, and we continued to operate primarily as a real estate company specializing in the ownership and leasing of retail motor fuel and convenience store properties and petroleum distribution terminals. We acquired Power Test Investors Limited Partnership (the “Partnership”) in 1998, thereby acquiring fee title to two hundred ninety-five properties we had previously leased from the Partnership and which the

Partnership had acquired from Texaco in 1985. We later sold the remaining portion of our home heating oil business. As a result, we are now exclusively engaged in the ownership, leasing and management of real estate assets, principally in the petroleum marketing industry.

Marketing was acquired by a U.S. subsidiary of Lukoil in December 2000. In connection with Lukoil’s acquisition of Marketing, we renegotiated our long-term unitary triple-net lease (the “Master Lease”) with Marketing. As of December 31, 2009, Marketing leased from us eight hundred thirty properties under the Master Lease and ten properties under supplemental leases (collectively with the Master Lease, the “Marketing Leases”). Eight hundred thirty-one of the properties leased to Marketing are retail motor fuel and convenience store properties and nine of the properties are petroleum distribution terminals. Seven hundred eight of the properties leased to Marketing are owned by us and one hundred thirty-two of the properties are leased by us from third parties. The Master Lease has an initial term expiring in December 2015, and generally provides Marketing with three renewal options of ten years each and a final renewal option of three years and ten months extending to 2049. The Master Lease is a unitary lease and, therefore, Marketing’s exercise of any renewal option can only be on an “all or nothing” basis. The supplemental leases have initial terms of varying expiration dates. The Marketing Leases are “triple-net” leases, pursuant to which Marketing is responsible for the payment of taxes, maintenance, repair, insurance and other operating expenses. We have licensed the Getty® trademarks to Marketing on an exclusive basis in its marketing territory as of December 2000. We have also licensed the trademarks to Marketing on a non-exclusive basis outside that territory, subject to a gallonage-based royalty, although to date, Marketing has not used the trademark outside that territory. (For additional information regarding Marketing and the Marketing Leases, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing Leases”.)

We elected to be treated as a REIT under the federal income tax laws beginning January 1, 2001. A REIT is a corporation, or a business trust that would otherwise be taxed as a corporation, which meets certain requirements of the Internal Revenue Code. The Internal Revenue Code permits a qualifying REIT to deduct dividends paid, thereby effectively eliminating corporate level federal income tax and making the REIT a pass-through vehicle for federal income tax purposes. To meet the applicable requirements of the Internal Revenue Code, a REIT must, among other things, invest substantially all of its assets in interests in real estate (including mortgages and other REITs) or cash and government securities, derive most of its income from rents from real property or interest on loans secured by mortgages on real property, and distribute to shareholders annually a substantial portion of its otherwise taxable income. As a REIT, we are required to distribute at least ninety percent of our taxable income to our shareholders each year and would be subject to corporate level federal income taxes on any taxable income that is not distributed.

Real Estate Business

The operators of our properties are primarily distributors and retailers engaged in the sale of gasoline and other motor fuel products, convenience store products and automotive repair services. Over the past decade, these lines of business have matured into a single industry as operators increased their emphasis on co-branded locations with multiple uses. The combination of petroleum product sales with other offerings, particularly convenience store products, has helped provide one-stop shopping for consumers and we believe represented a driving force behind the industry’s historical growth. In those instances where we determine that the best use for a property is no longer as a retail motor fuel outlet, we will seek an alternative tenant or buyer for the property. We lease or sublet approximately twenty of our properties for such uses as fast food restaurants, automobile sales and other retail purposes.

Revenues from rental properties included in continuing operations for the year ended December 31, 2009 were $84.5 million which is comprised of $82.5 million of lease payments received and $2.0 million of “Rental Revenue Adjustments” consisting of deferred rental income recognized due to the straight-line method of accounting for the leases with Marketing and certain of our other tenants, amortization of above-market and below-market rent for acquired in-place leases and income recognized for direct financing leases. In 2009, we received lease payments from Marketing aggregating approximately $60.0 million (or 72.7%) of the $82.5 million lease payments received included in continuing operations. Our financial results are materially dependent upon the ability of Marketing to meet its rental and environmental obligations under the Marketing Leases. Marketing’s financial results depend on retail petroleum marketing margins from the sale of refined petroleum products and rental income from its subtenants. Marketing’s subtenants either operate their gas stations, convenience stores, automotive repair services or other businesses at our properties or are petroleum distributors who may operate our properties directly and/or sublet our properties to the operators. Since a substantial portion of our revenues are derived from the Marketing Leases, any factor that adversely affects Marketing’s ability to meet its obligations under the Marketing Leases

may have a material adverse effect on our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price. Marketing has made all required monthly rental payments under the Marketing Leases when due through March 2010, although there can be no assurance that it will continue to do so. (For additional information regarding the portion of our financial results that are attributable to Marketing, see Note 11 in “Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements.” For additional information regarding Marketing and the Marketing Leases, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing Leases”.) You can find more information about our revenues, profits and assets by referring to the financial statements and supplemental financial information in “Item 8. Financial Statements and Supplementary Data”.

As of December 31, 2009, we owned fee title to nine hundred one retail motor fuel, convenience store and other retail properties and nine petroleum distribution terminals. We also leased one hundred sixty-one retail motor fuel, convenience store and other retail properties. Our typical property is used as a retail motor fuel outlet or convenience store, and is located on between one-half and three quarters of an acre of land in a metropolitan area. Our properties are located primarily in the Northeast and the Mid-Atlantic regions in the United States. The Company also owns or leases properties in Texas, North Carolina, Hawaii, California, Florida, Arkansas, Illinois, Ohio, and North Dakota. Approximately one-half of our retail motor fuel properties have repair bays (typically two or three bays per station) and nearly half have convenience stores, canopies or both. We lease four thousand square feet of office space at 125 Jericho Turnpike, Jericho, New York, which is used for our corporate headquarters.

We believe our network of retail motor fuel and convenience store properties and terminal properties across the Northeast and the Mid-Atlantic regions of the United States is unique and that comparable networks of properties are not readily available for purchase or lease from other owners or landlords. Many of our properties are located at highly trafficked urban intersections or conveniently close to highway entrance and exit ramps. Furthermore, we believe that obtaining the permits necessary to operate a network of petroleum marketing properties such as ours would be a difficult, time consuming and costly process for any potential competitor. However, the real estate industry is highly competitive, and we compete for tenants with a large number of property owners. Our principal means of competition are rents charged in relation to the income producing potential of the location. In addition, we expect other major real estate investors with significant capital will compete with us for attractive acquisition opportunities. These competitors include petroleum manufacturing, distributing and marketing companies, other REITs, investment banking firms and private institutional investors. This competition has increased prices for commercial properties and may impair our ability to make suitable property acquisitions on favorable terms in the future.

As part of our overall growth strategy we regularly review opportunities to acquire additional properties and we expect to continue to pursue acquisitions that we believe will benefit our financial performance. To the extent that our current sources of liquidity are not sufficient to fund such acquisitions we will require other sources of capital, which may or may not be available on favorable terms or at all.

Trademarks

We own the Getty® name and trademark in connection with our real estate and the petroleum marketing business in the United States and have licensed the Getty® trademarks to Marketing on an exclusive basis in its marketing territory as of December 2000. We have also licensed the trademarks to Marketing on a non-exclusive basis outside that territory, subject to a gallonage-based royalty, although to date, Marketing has not used the trademark outside that territory. The trademark licenses with Marketing are coterminous with the Master Lease.

Regulation

We are subject to numerous existing federal, state and local laws and regulations including matters related to the protection of the environment such as the remediation of known contamination and the retirement and decommissioning or removal of long-lived assets including buildings containing hazardous materials, underground storage tanks (“UST” or “USTs”) and other equipment. Petroleum properties are governed by numerous federal, state and local environmental laws and regulations. These laws have included: (i) requirements to report to governmental authorities discharges of petroleum products into the environment and, under certain circumstances, to remediate the soil and/or groundwater contamination

pursuant to governmental order and directive, (ii) requirements to remove and replace USTs that have exceeded governmental-mandated age limitations and (iii) the requirement to provide a certificate of financial responsibility with respect to claims relating to UST failures. Our tenants are directly responsible for compliance with various environmental laws and regulations as the operators of our properties.

We believe that we are in substantial compliance with federal, state and local provisions enacted or adopted pertaining to environmental matters. Although we are unable to predict what legislation or regulations may be adopted in the future with respect to environmental protection and waste disposal, existing legislation and regulations have had no material adverse effect on our competitive position. (For additional information with respect to pending environmental lawsuits and claims see “Item 3. Legal Proceedings”.)

Environmental expenses are principally attributable to remediation costs which include installing, operating, maintaining and decommissioning remediation systems, monitoring contamination, and governmental agency reporting incurred in connection with contaminated properties. We seek reimbursement from state UST remediation funds related to these environmental expenses where available. We enter into leases and various other agreements which allocate responsibility for known and unknown environmental liabilities by establishing the percentage and method of allocating responsibility between the parties. In accordance with leases with certain tenants, we have agreed to bring the leased properties with known environmental contamination to within applicable standards, and to either regulatory or contractual closure (“Closure”) in an efficient and economical manner. Generally, upon achieving Closure at each individual property, our environmental liability under the lease for that property will be satisfied and future remediation obligations will be the responsibility of our tenant. As of December 31, 2009, we have regulatory approval for remediation action plans in place for two hundred forty-five (95%) of the two hundred fifty-eight properties for which we continue to retain remediation responsibility and the remaining thirteen properties (5%) were in the assessment phase. In addition, we have nominal post-closure compliance obligations at twenty-two properties where we have received “no further action” letters.

Our tenants are directly responsible to pay for (i) remediation of environmental contamination they cause and compliance with various environmental laws and regulations as the operators of our properties, and (ii) environmental liabilities allocated to our tenants under the terms of our leases and various other agreements between our tenants and us. Generally, the liability for the retirement and decommissioning or removal of USTs and other equipment is the responsibility of our tenants. We are contingently liable for these obligations in the event that our tenants do not satisfy their responsibilities. A liability has not been accrued for obligations that are the responsibility of our tenants based on our tenants’ past histories of paying such obligations and/or our assessment of their respective financial abilities to pay their share of such costs. However, there can be no assurance that our assessments are correct or that our tenants who have paid their obligations in the past will continue to do so.

It is possible that our assumptions regarding the ultimate allocation methods and share of responsibility that we used to allocate environmental liabilities may change, which may result in adjustments to the amounts recorded for environmental litigation accruals, environmental remediation liabilities and related assets. We will be required to accrue for environmental liabilities that we believe are allocable to others under various agreements if we determine that it is probable that the counter-party will not meet its environmental obligations. We may ultimately be responsible to directly pay for environmental liabilities as the property owner if the counterparty fails to pay them. The ultimate resolution of these matters could have a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

For additional information please refer to “Item 1A. Risk Factors” and to “General – Marketing and the Marketing Leases,” “Liquidity and Capital Resources,” “Environmental Matters” and “Contractual Obligations” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” which appear in Item 7. of this Annual Report on Form 10-K.

Personnel

As of March 16, 2010, we had sixteen employees.

Access to our filings with the Securities and Exchange Commission and Corporate Governance Documents

Our website address is www.gettyrealty.com. Our address, phone number and a list of our officers is available on our website. Our website contains a hyperlink to the EDGAR database of the Securities and Exchange Commission at www.sec.gov where you can access, free-of-charge, our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to these reports as soon as reasonably practicable after such reports are filed. Our website also contains our business conduct guidelines, corporate governance guidelines and the charters of the Compensation, Nominating/Corporate Governance and Audit Committees of our Board of Directors. We also will provide copies of these reports and corporate governance documents free-of-charge upon request, addressed to Getty Realty Corp., 125 Jericho Turnpike, Suite 103, Jericho, NY 11753, Attn: Investor Relations. Information available on or accessible through our website shall not be deemed to be a part of this Annual Report on Form 10-K. You may read and copy any materials that we file with the Securities and Exchange Commission at the Securities and Exchange Commission’s Public Reference Room at 100 F Street, N.E., Washington, DC 20549. You may obtain information on the operation of the Public Reference Room by calling the Securities and Exchange Commission at 1-800-SEC-0330.

Item 1A. Risk Factors

We are subject to various risks, many of which are beyond our control. As a result of these and other factors, we may experience material fluctuations in our future operating results on a quarterly or annual basis, which could materially and adversely affect our business, financial condition, results of operations liquidity, ability to pay dividends or stock price. An investment in our stock involves various risks, including those mentioned below and elsewhere this Annual Report on Form 10-K and those that are described from time to time in our other filings with the SEC.

We are subject to risks inherent in owning and leasing real estate.

We are subject to varying degrees of risk generally related to leasing and owning real estate many of which are beyond our control. In addition to general risks related to owning properties used in the petroleum marketing industry, our risks include, among others:


•	our liability as a lessee for long-term lease obligations regardless of our revenues,

•	deterioration in national, regional and local economic and real estate market conditions,

•	potential changes in supply of, or demand for, rental properties similar to ours,

•	competition for tenants and declining rental rates,

•	difficulty in selling or re-letting properties on favorable terms or at all,

•	impairments in our ability to collect rent payments when due,

•	increases in interest rates and adverse changes in the availability, cost and terms of financing,

•	the potential for uninsured casualty and other losses,

•	the impact of present or future environmental legislation and compliance with environmental laws,

•	adverse changes in zoning laws and other regulations, and

•	acts of terrorism and war.

Each of these factors could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. In addition, real estate investments are relatively illiquid, which means that our ability to vary our portfolio of properties in response to changes in economic and other conditions may be limited.

Adverse developments in general business, economic, or political conditions could have a material adverse effect on us.

Adverse developments in general business and economic conditions, including through recession, downturn or otherwise, either in the economy generally or in those regions in which a large portion of our business is conducted, could have a material adverse effect on us and significantly increase certain of the risks we are subject to. The general economic conditions in the United States are, and for an extended period of time may be, significantly less favorable than that of prior years. Among other effects, adverse economic conditions could depress real estate values, impact our ability to re-let or sell our properties and have an adverse effect on our tenants’ level of sales and financial performance generally. Our revenues are dependent on the economic success of our tenants and any factors that adversely impact our tenants could also have a material adverse effect on our business, financial condition and results of operations liquidity, ability to pay dividends or stock price.

Because our financial results are materially dependent on the performance of Marketing, in the event that Marketing does not perform its rental or environmental obligations under the Marketing Leases, our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price could be materially adversely affected. The financial performance of Marketing had been deteriorating over the three years ending December 31, 2008. No assurance can be given that Marketing will have the ability to meet its obligations under the Marketing Leases.

Our financial results are materially dependent upon the ability of Marketing to meet its rental and environmental obligations under the Marketing Leases. A substantial portion of our revenues (71% for the year ended December 31, 2009) are derived from the Marketing Leases. Accordingly, any factor that adversely affects Marketing’s ability to meet its obligations under the Marketing Leases may have a material adverse effect on our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price. For additional information regarding the portion of our financial results that are attributable to Marketing, see Note 11 in “Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements.” Marketing has made all required monthly rental payments under the Marketing Leases when due through March 2010, although there can be no assurance that it will continue to do so.

For the year ended December 31, 2008, Marketing reported a significant loss, continuing a trend of reporting large losses in recent years. We have not received Marketing’s operating results for the year ended December 31, 2009. As a result of Marketing’s significant losses for each of the three years ended December 31, 2008, 2007 and 2006 and the cumulative impact of those losses on Marketing’s financial position as of December 31, 2008, we previously concluded that Marketing likely does not have the ability to generate cash flows from its business sufficient to meet its obligations as they come due in the ordinary course through the terms of the Marketing Leases unless it shows significant improvement in its financial results, generates sufficient liquidity through the sale of assets or otherwise, or receives financial support from OAO LUKoil, (“Lukoil”), its parent company. As discussed in more detail below, Marketing has recently undergone a restructuring of its business. We do not know whether Marketing will continue to be dependent on financial support from Lukoil to meet its obligations as they become due through the terms of the Marketing Leases. Lukoil is not, however, a guarantor of the Marketing Leases. Even though Marketing is a wholly-owned subsidiary of Lukoil, and Lukoil has provided capital to Marketing in the past, there can be no assurance that Lukoil will provide financial support or additional capital to Marketing in the future. If Marketing does not meet its obligations under the Marketing Leases, our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price may be materially adversely affected.

In the fourth quarter of 2009, Marketing announced a restructuring of its business. We cannot predict with certainty what impact Marketing’s restructuring and other changes in its business model will have on us.

In the fourth quarter of 2009, Marketing announced a restructuring of its business. Marketing disclosed that the restructuring included the sale of all assets unrelated to the properties it leases from us, the elimination of parent-guaranteed debt, and steps to reduce operating costs. Marketing sold all assets unrelated to the properties it leases from us to its affiliates, LUKOIL Pan Americas L.L.C. and LUKOIL North America LLC. Marketing paid off debt which had been guaranteed by Lukoil with proceeds from the sale of assets to Lukoil affiliates and with financial support from Lukoil. Marketing also announced additional steps to reduce its costs including closing two marketing regions, eliminating jobs and exiting the direct-supplied retail gasoline business.

We believe that Marketing is exiting the direct-supplied retail gasoline business by entering into subleases with petroleum distributors who supply their own petroleum products to our properties. Approximately two hundred fifty retail properties, comprising substantially all of the properties in New England that we lease to Marketing, have been subleased by Marketing to a single distributor. These properties are in the process of being rebranded BP stations and are being supplied petroleum products under a supply contract with BP. In addition, we believe that Marketing recently entered into a sublease with a single distributor in New Jersey covering approximately eighty-five of our properties. We believe that Marketing is seeking subtenants for other significant portions of the portfolio of properties it leases from us.

In connection with its restructuring, Marketing eliminated debt which had been guaranteed by Lukoil with proceeds from the sale of assets to Lukoil affiliates and with financial support from Lukoil. We cannot predict whether the restructuring announced by Marketing will stem Marketing’s recent history of significant annual operating losses, and whether Marketing will continue to be dependent on financial support from Lukoil to meet its obligations as they become due through the terms of the Marketing Leases. Lukoil is not, however, a guarantor of the Marketing Leases. Even though Marketing is a wholly-owned subsidiary of Lukoil, and Lukoil has provided capital to Marketing in the past, there can be no assurance that Lukoil will provide financial support or additional capital to Marketing in the future. We cannot predict with certainty what impact Marketing’s restructuring and other changes in its business model will have on us. If Marketing does not meet its obligations under the Marketing Leases, our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price may be materially adversely affected.

Although we periodically receive and review the unaudited financial statements and other financial information from Marketing, this information is not publicly available to investors. You will not have access to financial information about Marketing provided to us by Marketing to allow you to independently assess Marketing’s financial condition or its ability to satisfy its obligations under the Marketing Leases.

We periodically receive and review Marketing’s unaudited financial statements and other financial information. We receive the financial statements and other financial information from Marketing pursuant to the terms of the Marketing Leases. However, the financial statements and other financial information are not publicly available to investors and Marketing contends that the terms of the Marketing Leases prohibit us from including the financial statements and other financial information in our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q or in our Annual Reports to Shareholders. The Marketing Leases provide that Marketing’s financial information which is not publicly available shall be delivered to us within one hundred fifty days after the end of each fiscal year. We have not received Marketing’s operating results for the year ended December 31, 2009. The financial statements and other financial information that we receive from Marketing is unaudited and neither we, nor our auditors, have been involved with its preparation and as a result have no assurance as to its correctness or completeness. You will not have access to financial statements and other financial information about Marketing provided to us by Marketing to allow you to independently assess Marketing’s financial condition or its ability to satisfy its obligations under the Marketing Leases, which may put your investment in us at greater risk of loss.

If the Marketing Leases are modified significantly or terminated, our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price could be materially adversely affected.

From time to time we have held discussions with representatives of Marketing regarding potential modifications to the Marketing Leases. These efforts have been unsuccessful to date as we have not yet reached a common understanding with Marketing that would form a basis for modification of the Marketing Leases. From time to time, however, we have been able to agree with Marketing on terms to allow for removal of individual properties from the Marketing Leases as mutually beneficial opportunities arise. We intend to continue to pursue the removal of individual properties from the Marketing Leases, and we remain open to removal of groups of properties; however, there is no fixed agreement in place providing for removal of properties from the Marketing Leases. Accordingly, the removal of properties from the Marketing Leases is subject to negotiation on a case-by-case basis. If Marketing ultimately determines that its business strategy is to exit all or a portion of the properties it leases from us, it is our intention to cooperate with Marketing in accomplishing those objectives if we determine that it is prudent for us to do so. Any modification of the Marketing Leases that removes a significant number of properties from the Marketing Leases would likely significantly reduce the amount of rent we receive from Marketing and increase our operating expenses. We cannot accurately predict if, or when, the Marketing Leases will be modified; what composition of properties, if any, may be removed from the Marketing Leases as part of any such modification; or what the terms of any agreement for modification of the Marketing Leases may be. We also cannot accurately predict what actions Marketing and Lukoil may take, and what our recourse may be, whether the Marketing Leases are modified or not. We may

be required to reserve additional amounts of the deferred rent receivable, record additional impairment charges related to our properties, or accrue for environmental liabilities as a result of the potential or actual modification or termination of the Marketing Leases or leases with our other tenants, which may result in material adjustments to the amounts recorded for these assets and liabilities.

As permitted under the terms of the Marketing Leases, Marketing generally can, subject to any contrary terms under applicable third party leases, use each property for any lawful purpose, or for no purpose whatsoever. We believe that as of December 31, 2009, Marketing had removed, or has scheduled removal of, the underground gasoline storage tanks and related equipment at approximately one hundred fifty, or 18%, of our properties and we also believe that most of these properties are either vacant or provide negative contribution to Marketing’s results. Marketing recently agreed to permit us to list with brokers and to show to prospective purchasers and lessees seventy-five of the properties where Marketing has removed, or has scheduled to remove, underground gasoline storage tanks and related equipment, and we are marketing such properties for sale or leasing. As previously discussed, however, there is no agreement between us and Marketing on terms for removal of properties from the Marketing Leases. In those instances where we determine that the best use for a property is no longer as a retail motor fuel outlet, we will seek an alternative tenant or buyer for such property. With respect to properties that are vacant or have had underground gasoline storage tanks and related equipment removed, it may be more difficult or costly to re-let or sell such properties as gas stations because of capital costs or possible zoning or permitting rights that are required and that may have lapsed during the period since gasoline was last sold at the property.

We intend either to re-let or sell any properties that are removed from the Marketing Leases, whether such removal arises consensually by negotiation or as a result of default by Marketing, and reinvest any realized sales proceeds in new properties. We intend to offer properties removed from the Marketing Leases to replacement tenants or buyers individually, or in groups of properties, or by seeking a single tenant for the entire portfolio of properties subject to the Marketing Leases. In the event that properties are removed from the Marketing Leases, we cannot accurately predict if, when, or on what terms such properties could be re-let or sold. If the Marketing Leases are significantly modified or terminated, our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price may be materially adversely affected.

If it becomes probable that Marketing will not pay its environmental obligations, or if we change our assumptions for environmental liabilities related to the Marketing Leases our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends stock price could be materially adversely affected.

Marketing is directly responsible to pay for (i) remediation of environmental contamination it causes and compliance with various environmental laws and regulations as the operator of our properties, and (ii) known and unknown environmental liabilities allocated to Marketing under the terms of the Marketing Leases and various other agreements with us relating to Marketing’s business and the properties it leases from us (collectively the “Marketing Environmental Liabilities”). However, we continue to have ongoing environmental remediation obligations at one hundred eighty-seven retail sites and for certain pre-existing conditions at six of the terminals we lease to Marketing. If Marketing fails to pay the Marketing Environmental Liabilities, we may ultimately be responsible to pay directly for Marketing Environmental Liabilities as the property owner. We do not maintain pollution legal liability insurance to protect us from potential future claims for Marketing Environmental Liabilities. If we incur material environmental liabilities our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price may be materially adversely affected. We will be required to accrue for Marketing Environmental Liabilities if we determine that it is probable that Marketing will not meet its obligations and we can reasonably estimate the amount of the Marketing Environmental Liabilities for which we will be directly responsible to pay, or if our assumptions regarding the ultimate allocation methods or share of responsibility that we used to allocate environmental liabilities changes. However, we continue to believe that it is not probable that Marketing will not pay for substantially all of the Marketing Environmental Liabilities since we believe that Lukoil will not allow Marketing to fail to perform its rental, environmental and other obligations under the Marketing Leases. Accordingly, we did not accrue for the Marketing Environmental Liabilities as of December 31, 2009 or December 31, 2008. Nonetheless, we have determined that the aggregate amount of the Marketing Environmental Liabilities (as estimated by us) could be material to us if we were required to accrue for all of the Marketing Environmental Liabilities in the future since we believe that as a result of any such accrual, it is reasonably possible that we may not be in compliance with the existing financial covenants in our Credit Agreement and our Term Loan Agreement. Such non-compliance could result in an event of default under the Credit Agreement and the Term Loan Agreement which, if not cured or waived, could result in the acceleration of all of our indebtedness under the Credit Agreement and our Term Loan Agreement. If we determine that it is probable that Marketing will not meet the Marketing Environmental Liabilities and we accrue for such liabilities, our business, financial condition,

revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price may be materially adversely affected.

We estimate that as of December 31, 2009, the aggregate Marketing Environmental Liabilities for which we may ultimately be responsible to pay range between $13 million and $20 million, net of expected recoveries from underground storage tank funds, of which between $6 million and $9 million relate to the three hundred fifty properties that we identified as the basis for our estimate of the deferred rent receivable reserve. Since we generally do not have access to certain site specific information available to Marketing, which is the party responsible for paying and managing its environmental remediation expenses at our properties, our estimates were developed in large part by review of the limited publically available information gathered through electronic databases and freedom of information requests and assumptions we made based on that data and on our own experiences with environmental remediation matters. The actual aggregate Marketing Environmental Liabilities and the actual Marketing Environmental Liabilities related to the three hundred fifty properties that we identified as the basis for our estimate of the deferred rent receivable reserve may differ materially from our estimates and we can provide no assurance as to the accuracy of these estimates.

Substantially all of our tenants depend on the same industry for their revenues.

We derive substantially all of our revenues from leasing, primarily on a triple-net basis, retail motor fuel and convenience store properties and petroleum distribution terminals to tenants in the petroleum marketing industry. Accordingly, our revenues will be dependent on the economic success of the petroleum marketing industry, and any factors that adversely affect that industry could also have a material adverse effect on our business, financial condition and results of operations liquidity, ability to pay dividends or stock price. The success of participants in that industry depends upon the sale of refined petroleum products at margins in excess of fixed and variable expenses. The petroleum marketing industry is highly competitive and volatile. Petroleum products are commodities, the prices of which depend on numerous factors that affect supply and demand. The prices paid by our tenants and other petroleum marketers for products are affected by global, national and regional factors. A large, rapid increase in wholesale petroleum prices would adversely affect the profitability and cash flows of Marketing and our other tenants if the increased cost of petroleum products could not be passed on to their customers or if automobile consumption of gasoline were to decline significantly. Petroleum products are commodities, the prices of which depend on numerous factors that affect the supply of and demand for petroleum products. The prices paid by Marketing and other petroleum marketers for products are affected by global, national and regional factors. We cannot be certain how these factors will affect petroleum product prices or supply in the future, or how in particular they will affect Marketing or our other tenants.

Our future cash flow is dependent on the performance of our tenants of their lease obligations, renewal of existing leases and either re-letting or selling our vacant properties.

We are subject to risks that financial distress, default or bankruptcy of our existing tenants may lead to vacancy at our properties or disruption in rent receipts as a result of partial payment or nonpayment of rent or that expiring leases may not be renewed. Under unfavorable general economic conditions, there can be no assurance that our tenants’ level of sales and financial performance generally will not be adversely affected, which in turn, could impact the reliability of our rent receipts. We are subject to risks that the terms of renewal or re-letting our properties (including the cost of required renovations, replacement of gasoline tanks and related equipment or environmental remediation) may be less favorable than current lease terms, or that the values of our properties that we sell may be adversely affected by unfavorable general economic conditions. Unfavorable general economic conditions may also negatively impact our ability to re-let or sell our properties. Numerous properties compete with our properties in attracting tenants to lease space. The number of available or competitive properties in a particular area could have a material adverse effect on our ability to lease or sell our properties and on the rents charged. In addition to the risk of disruption in rent receipts, we are subject to the risk of incurring real estate taxes, maintenance, environmental and other expenses at vacant properties.

The financial distress, default or bankruptcy of our tenants may also lead to a protracted and expensive processes for retaking control of our properties than would otherwise be the case, including, eviction or other legal proceedings related to or resulting from the tenant’s default. These risks are greater with respect to certain of our tenants who lease multiple properties from us, such as Marketing. (For additional information regarding the portion of our financial results that are attributable to Marketing, see Note 11 in “Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements.” For additional information with respect to concentration of tenant risk, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing

Leases”.) If a tenant files for bankruptcy protection it is possible that we would recover substantially less than the full value of our claims against the tenant.

If our tenants do not perform their lease obligations, or we were unable to renew existing leases and promptly recapture and re-let or sell vacant locations; or if lease terms upon renewal or re-letting were less favorable than current lease terms, or if the values of properties that we sell are adversely affected by market conditions; or if we incur significant costs or disruption related to or resulting from tenant financial distress, default or bankruptcy; our cash flow could be significantly adversely affected.

Property taxes on our properties may increase without notice.

Each of the properties we own or lease is subject to real property taxes. The leases for certain of the properties that we lease from third parties obligate us to pay real property taxes with regard to those properties. The real property taxes on our properties and any other properties that we develop, acquire or lease in the future may increase as property tax rates change and as those properties are assessed or reassessed by tax authorities. To the extent that our tenants are unable or unwilling to pay such increase in accordance with their leases, our net operating expenses may increase.

We have incurred, and may incur significantly higher operating costs as a result of environmental laws and regulations, which could reduce our profitability.

We are subject to numerous federal, state and local laws and regulations, including matters relating to the protection of the environment. Under certain environmental laws, a current or previous owner or operator of real estate may be liable for contamination resulting from the presence or discharge of hazardous or toxic substances or petroleum products at, on, or under, such property, and may be required to investigate and clean-up such contamination. Such laws typically impose liability and clean-up responsibility without regard to whether the owner or operator knew of or caused the presence of the contaminants, or the timing or cause of the contamination, and the liability under such laws has been interpreted to be joint and several unless the harm is divisible and there is a reasonable basis for allocation of responsibility. For example, liability may arise as a result of the historical use of a property or from the migration of contamination from adjacent or nearby properties. Any such contamination or liability may also reduce the value of the property. In addition, the owner or operator of a property may be subject to claims by third parties based on injury, damage and/or costs, including investigation and clean-up costs, resulting from environmental contamination present at or emanating from a property. The properties owned or controlled by us are leased primarily as retail motor fuel and convenience store properties, and therefore may contain, or may have contained, USTs for the storage of petroleum products and other hazardous or toxic substances, which creates a potential for the release of such products or substances. Some of our properties may be subject to regulations regarding the retirement and decommissioning or removal of long-lived assets including buildings containing hazardous materials, USTs and other equipment. Some of the properties may be adjacent to or near properties that have contained or currently contain USTs used to store petroleum products or other hazardous or toxic substances. In addition, certain of the properties are on, adjacent to, or near properties upon which others have engaged or may in the future engage in activities that may release petroleum products or other hazardous or toxic substances. There may be other environmental problems associated with our properties of which we are unaware. These problems may make it more difficult for us to re-let or sell our properties on favorable terms, or at all.

For additional information with respect to pending environmental lawsuits and claims, environmental remediation costs and estimates, and Marketing and the Marketing Leases see “Item 3. Legal Proceedings”, “Environmental Matters” and “General – Marketing and the Marketing Leases” in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 5 in “Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements” each of which is incorporated by reference herein.

We enter into leases and various other agreements which allocate responsibility for known and unknown environmental liabilities by establishing the percentage and method of allocating responsibility between the parties. Our tenants are directly responsible to pay for (i) remediation of environmental contamination they cause and compliance with various environmental laws and regulations as the operators of our properties, and (ii) environmental liabilities allocated to our tenants under the terms of our leases and various other agreements between our tenants and us. Generally, the liability for the retirement and decommissioning or removal of USTs and other equipment is the responsibility of our tenants. We are contingently liable for these obligations in the event that our tenants do not satisfy their responsibilities. A liability has not been accrued for obligations that are the responsibility of our tenants based on our tenants’ past histories of paying such obligations and/or our

assessment of their respective financial abilities to pay their share of such costs. However, there can be no assurance that our assessments are correct or that our tenants who have paid their obligations in the past will continue to do so.

As of December 31, 2009, we had accrued $12.6 million as management’s best estimate of the net fair value of reasonably estimable environmental remediation costs which is comprised of $16.5 million of estimated environmental obligations and liabilities offset by $3.9 million of estimated recoveries from state UST remediation funds, net of allowance. Environmental exposures are difficult to assess and estimate for numerous reasons, including the extent of contamination, alternative treatment methods that may be applied, location of the property which subjects it to differing local laws and regulations and their interpretations, as well as the time it takes to remediate contamination. In developing our liability for probable and reasonably estimable environmental remediation costs on a property by property basis, we consider among other things, enacted laws and regulations, assessments of contamination and surrounding geology, quality of information available, currently available technologies for treatment, alternative methods of remediation and prior experience. Environmental accruals are based on estimates which are subject to significant change, and are adjusted as the remediation treatment progresses, as circumstances change and as environmental contingencies become more clearly defined and reasonably estimable. Adjustments to accrued liabilities for environmental remediation costs will be reflected in our financial statements as they become probable and a reasonable estimate of fair value can be made.

We have not accrued for approximately $1.0 million in costs allegedly incurred by the current property owner in connection with removal of USTs and soil remediation at a property that was leased to and operated by Marketing. We believe that Marketing is responsible for such costs under the terms of the Master Lease, and have tendered the matter for defense and indemnification from Marketing, but Marketing had denied its liability for claims and its responsibility to defend against, and indemnify us, for the claim. We have filed third party claims against Marketing for indemnification in this matter. The property owner’s claim for reimbursement of costs incurred and our claim for indemnification by Marketing were actively litigated, leading to a trial held before a judge. The trial court issued its decision in August 2009 under which the Company and Marketing were held jointly and severally responsible to the current property owner for the costs incurred by the owner to remove USTs and remediate contamination at the site, but, as between the Company and Marketing, Marketing was accountable for such costs under the indemnification provisions of the Master Lease. The order on the trial court’s decision was entered in February 2010, making such decision final for purposes of initiating the limited period of time following which appeal may be taken. We believe that Marketing will appeal the decision; however, we believe the probability that Marketing will not be ultimately responsible for the claim for clean-up costs incurred by the current property owner is remote. It is reasonably possible that our assumption that Marketing will be ultimately responsible for the claim may change, which may result in our providing an accrual for this matter.

It is possible that our assumptions regarding the ultimate allocation methods and share of responsibility that we used to allocate environmental liabilities may change, which may result in adjustments to the amounts recorded for environmental litigation accruals, environmental remediation liabilities and related assets. We will be required to accrue for environmental liabilities that we believe are allocable to others under various other agreements if we determine that it is probable that the counter-party will not meet its environmental obligations. We may ultimately be responsible to directly pay for environmental liabilities as the property owner if the counterparty fails to pay them.

We cannot predict what environmental legislation or regulations may be enacted in the future, or if or how existing laws or regulations will be administered or interpreted with respect to products or activities to which they have not previously been applied. We cannot predict whether state UST fund programs will be administered and funded in the future in a manner that is consistent with past practices and if future environmental spending will continue to be eligible for reimbursement at historical recovery rates under these programs. Compliance with more stringent laws or regulations, as well as more vigorous enforcement policies of the regulatory agencies or stricter interpretation of existing laws which may develop in the future, could have an adverse effect on our financial position, or that of our tenants, and could require substantial additional expenditures for future remediation.

As a result of the factors discussed above, or others, compliance with environmental laws and regulations could have a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

We are defending pending lawsuits and claims and are subject to material losses.

We are subject to various lawsuits and claims, including litigation related to environmental matters, such as those arising from leaking USTs and releases of motor fuel into the environment, and toxic tort claims. The ultimate resolution of certain matters cannot be predicted because considerable uncertainty exists both in terms of the probability of loss and the estimate of such loss. Our ultimate liabilities resulting from such lawsuits and claims, if any, could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. For additional information with respect to pending environmental lawsuits and claims and environmental remediation costs and estimates see “Item 3. Legal Proceedings” and “Environmental Matters” in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 5 in “Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements” each of which is incorporated by reference herein.

A significant portion of our properties are concentrated in the Northeast and Mid-Atlantic regions of the United States, and adverse conditions in those regions, in particular, could negatively impact our operations.

A significant portion of the properties we own and lease are located in the Northeast and Mid-Atlantic regions of the United States. Because of the concentration of our properties in those regions, in the event of adverse economic conditions in

those regions, we would likely experience higher risk of default on payment of rent payable to us (including under the Marketing Leases) than if our properties were more geographically diversified. Additionally, the rents on our properties may be subject to a greater risk of default than other properties in the event of adverse economic, political, or business developments or natural hazards that may affect the Northeast or Mid-Atlantic United States and the ability of our lessees to make rent payments. This lack of geographical diversification could have a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

We are in a competitive business.

The real estate industry is highly competitive. Where we own properties, we compete for tenants with a large number of real estate property owners and other companies that sublet properties. Our principal means of competition are rents charged in relation to the income producing potential of the location. In addition, we expect other major real estate investors, some with much greater financial resources or more experienced personnel than we have, will compete with us for attractive acquisition opportunities. These competitors include petroleum manufacturing, distributing and marketing companies, other REITs, investment banking firms and private institutional investors. This competition has increased prices for properties we seek to acquire and may impair our ability to make suitable property acquisitions on favorable terms in the future.

We are exposed to counterparty credit risk and there can be no assurances that we will manage or mitigate this risk effectively.

We regularly interact with counterparties in various industries. The types of counterparties most common to our transactions and agreements include, but are not limited to, landlords, tenants, vendors and lenders. Our most significant counterparties include, but are not limited to, Marketing as our primary tenant, the members of the Bank Syndicate that are counterparties to our Credit Agreement as our primary source of financing and JPMorgan Chase as the counterparty to our interest rate Swap Agreement. The default, insolvency or other inability of a significant counterparty to perform its obligations under an agreement or transaction, including, without limitation, as a result of the rejection of an agreement or transaction in bankruptcy proceedings, could have a material adverse effect on us. (For additional information with respect to, and definitions of, the Bank Syndicate, the Credit Agreement and the Swap Agreement, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources” and “Item 7A. Quantitative and Qualitative Disclosures About Market Risks”.)

We may acquire or develop new properties, and this may create risks.

We may acquire or develop properties or acquire other real estate companies when we believe that an acquisition or development matches our business strategies. These properties may have characteristics or deficiencies currently unknown to us that affect their value or revenue potential. It is possible that the operating performance of these properties may decline after we acquire them, they may not perform as expected and, if financed using debt or new equity issuances, may result in shareholder dilution. Our acquisitions of new properties will also expose us to the liabilities of those properties, some of which we may not be aware of at the time of acquisition. We face competition in pursuing these acquisitions and we may not succeed in leasing newly developed or acquired properties at rents sufficient to cover their costs of acquisition or development and operations. Newly acquired properties may require significant management attention that would otherwise be devoted to our ongoing business. We may not succeed in consummating desired acquisitions or in completing developments on time or within our budget. Consequences arising from or in connection with any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

We are subject to losses that may not be covered by insurance.

Marketing, and other tenants, as the lessees of our properties, are required to provide insurance for such properties, including casualty, liability, fire and extended coverage in amounts and on other terms as set forth in our leases. We do not maintain pollution legal liability insurance to protect the Company from potential future claims for environmental contamination, including the environmental liabilities that are the responsibility of our tenants. We carry insurance against certain risks and in such amounts as we believe are customary for businesses of our kind. However, as the costs and availability of insurance change, we may decide not to be covered against certain losses (such as certain environmental liabilities, earthquakes, hurricanes, floods and civil disorder) where, in the judgment of management, the insurance is not warranted due to cost or availability of coverage or the remoteness of perceived risk. There is no assurance that our insurance

against loss will be sufficient. The destruction of, or significant damage to, or significant liabilities arising out of conditions at, our properties due to an uninsured cause would result in an economic loss and could result in us losing both our investment in, and anticipated profits from, such properties. When a loss is insured, the coverage may be insufficient in amount or duration, or a lessee’s customers may be lost, such that the lessee cannot resume its business after the loss at prior levels or at all, resulting in reduced rent or a default under its lease. Any such loss relating to a large number of properties could have a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

Failure to qualify as a REIT under the federal income tax laws would have adverse consequences to our shareholders.

We elected to be treated as a REIT under the federal income tax laws beginning January 1, 2001. We cannot, however, guarantee that we will continue to qualify in the future as a REIT. We cannot give any assurance that new legislation, regulations, administrative interpretations or court decisions will not significantly change the requirements relating to our qualification. If we fail to qualify as a REIT, we would not be allowed a deduction for distributions to shareholders in computing our taxable income and will again be subject to federal income tax at regular corporate rates, we could be subject to the federal alternative minimum tax, we would be required to pay significant income taxes and we would have less money available for our operations and distributions to shareholders. This would likely have a significant adverse effect on the value of our securities. We could also be precluded from treatment as a REIT for four taxable years following the year in which we lost the qualification, and all distributions to shareholders would be taxable as regular corporate dividends to the extent of our current and accumulated earnings and profits. Loss of our REIT status would result in an event of default that, if not cured or waived, could result in the acceleration of all of our indebtedness under our Credit Agreement and Term Loan Agreement which could have a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

We are dependent on external sources of capital which may not be available on favorable terms, if at all.

We are dependent on external sources of capital to maintain our status as a REIT and must distribute to our shareholders each year at least ninety percent of our net taxable income, excluding any net capital gain. Because of these distribution requirements, it is not likely that we will be able to fund all future capital needs, including acquisitions, from income from operations. Therefore, we will have to continue to rely on third-party sources of capital, which may or may not be available on favorable terms, or at all. As part of our overall growth strategy we regularly review opportunities to acquire additional properties and we expect to continue to pursue acquisitions that we believe will benefit our financial performance. To the extent that our current sources of liquidity are not sufficient to fund such acquisitions we will require other sources of capital, which may or may not be available on favorable terms or at all. We cannot accurately predict how periods of illiquidity in the credit markets, such as current market conditions, will impact our access to or cost of capital. In addition, additional equity offerings may result in substantial dilution of shareholders’ interests, and additional debt financing may substantially increase our leverage. Our access to third-party sources of capital depends upon a number of factors including general market conditions, the market’s perception of our growth potential, our current and potential future earnings and cash distributions, covenants and limitations imposed under our Credit Agreement and our Term Loan Agreement and the market price of our common stock.

The United States credit markets experienced an unprecedented contraction beginning in 2007. As a result of the tightened credit markets, we may not be able to obtain additional financing on favorable terms, or at all. If one or more of the financial institutions that supports our Credit Agreement fails, we may not be able to find a replacement, which would negatively impact our ability to borrow under our the Credit Agreement. If the current pressures on credit continue or worsen, we may not be able to refinance our outstanding debt when due in March 2011, (or in March 2012 if we exercise our option to extend the term of the Credit Agreement for one additional year), which could have a material adverse effect on us. We may be precluded from exercising our option to extend the term of the Credit Agreement for one additional year if we are in default of the Credit Agreement.

Our ability to meet the financial and other covenants relating to our Credit Agreement and our Term Loan Agreement may be dependent on the performance of our tenants, including Marketing. Should our assessments, assumptions and beliefs that affect our accounting prove to be incorrect, or if circumstances change, we may have to materially adjust the amounts recorded in our financial statements for certain assets and liabilities, and as a result of which, we may not be in compliance with the financial covenants in our Credit Agreement and our Term Loan Agreement. We have determined that the aggregate

amount of the Marketing Environmental Liabilities (as estimated by us, based on our assumptions and analysis of information currently available to us described in more detail above) could be material to us if we were required to accrue for all of the Marketing Environmental Liabilities in the future since we believe that it is reasonably possible that as a result of such accrual, we may not be in compliance with the existing financial covenants in our Credit Agreement and our Term Loan Agreement. (For additional information with respect to The Marketing Environmental Liabilities, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing Leases”.) If we are not in compliance with one or more of our covenants which, if not complied with could result in an event of default under our Credit Agreement or our Term Loan Agreement, there can be no assurance that our lenders would waive such non-compliance. A default under our Credit Agreement or our Term Loan Agreement, if not cured or waived, whether due to a loss of our REIT status, a material adverse effect on our business, financial condition or prospects, a failure to comply with financial and certain other covenants in the Credit Agreement or our Term Loan Agreement or otherwise, could result in the acceleration of all of our indebtedness under our Credit Agreement and our Term Loan Agreement. This could have a material adverse affect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

The downturn in the credit markets has increased the cost of borrowing and has made financing difficult to obtain, which may negatively impact our business, and may have a material adverse effect on us. Lenders may require us to enter into more restrictive covenants relating to our operations.

During 2007, the United States housing and residential lending markets began to experience accelerating default rates, declining real estate values and increasing backlog of housing supply. The residential sector issues quickly spread more broadly into the corporate, asset-backed and other credit and equity markets and the volatility and risk premiums in most credit and equity markets have increased dramatically, while liquidity has decreased. These issues have continued into the beginning of 2010. Increasing concerns regarding the United States and world economic outlook, such as large asset write-downs at banks, volatility in oil prices, declining business and consumer confidence and increased unemployment and bankruptcy filings, are compounding these issues and risk premiums in most capital markets remain near historical all-time highs. These factors are precipitating generalized credit market dislocations and a significant contraction in available credit. As a result, it is becoming increasingly difficult to obtain cost-effective debt capital to finance new investment activity or to refinance maturing debt, and most lenders are imposing more stringent restrictions on the terms of credit. Any future credit agreements or loan documents we execute may contain additional or more restrictive covenants. The negative impact on the tightening of the credit markets and continuing credit and liquidity concerns could have negative effects on our business such as (i) we could have difficulty in acquiring or developing properties, which would adversely affect our business strategy, (ii) our liquidity could be adversely affected, (iii) we may be unable to repay or refinance our indebtedness or (iv) we may need to make higher interest and principal payments or sell some of our assets on unfavorable terms to fund our liquidity needs. These negative effects may cause other material adverse effects on our business, financial condition, results of operations, ability to pay dividends or stock price. Additionally, there is no assurance that the increased financing costs, financing with increasingly restrictive terms or the increase in risk premiums that are demanded by investors will not have a material adverse effect on us.

Our business operations may not generate sufficient cash for distributions or debt service.

There is no assurance that our business will generate sufficient cash flow from operations or that future borrowings will be available to us in an amount sufficient to enable us to make distributions on our common stock, to pay our indebtedness, or to fund our other liquidity needs. We may not be able to repay or refinance existing indebtedness on favorable terms, which could force us to dispose of properties on disadvantageous terms (which may also result in losses) or accept financing on unfavorable terms.

We are exposed to interest rate risk and there can be no assurances that we will manage or mitigate this risk effectively.

We are exposed to interest rate risk, primarily as a result of our $175.0 million Credit Agreement and our $25.0 million Term Loan Agreement. Borrowings under our Credit Agreement and our Term Loan Agreement bear interest at a floating rate. Accordingly, an increase in interest rates will increase the amount of interest we must pay under our Credit Agreement and our Term Loan Agreement. A significant increase in interest rates could also make it more difficult to find alternative financing on desirable terms. We have entered into an interest rate Swap Agreement with a major financial institution with respect to a portion of our variable rate debt outstanding under our Credit Agreement. We are, and will be, exposed to interest rate risk to the extent that our aggregate borrowings floating at market rates exceed the $45.0 million notional amount of the Swap Agreement. Although the Swap Agreement is intended to lessen the impact of rising interest rates, it also exposes us to

the risk that the other party to the agreement will not perform, the agreement will be unenforceable and the underlying transactions will fail to qualify as a highly-effective cash flow hedge for accounting purposes. Further, there can be no assurance that the use of an interest rate swap will always be to our benefit. While the use of an interest rate Swap Agreement is intended to lessen the adverse impact of rising interest rates, it also conversely limits the positive impact that could be realized from falling interest rates with respect to the portion of our variable rate debt covered by the interest rate Swap Agreement. (For additional information with respect to interest rate risk, see “Item 7A. Quantitative and Qualitative Disclosures About Market Risks”.)

We may be unable to pay dividends.

Under the Maryland General Corporation Law, our ability to pay dividends would be restricted if, after payment of the dividend, (1) we would not be able to pay indebtedness as it becomes due in the usual course of business or (2) our total assets would be less than the sum of our liabilities plus the amount that would be needed, if we were to be dissolved, to satisfy the rights of any shareholders with liquidation preferences. There currently are no shareholders with liquidation preferences. No assurance can be given that our financial performance in the future will permit our payment of any dividends. (For additional information regarding Marketing and the Marketing Leases, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing Leases”.) In particular, our Credit Agreement and our Term Loan Agreement prohibit the payments of dividends during certain events of default. As a result of the factors described above, we may experience material fluctuations in future operating results on a quarterly or annual basis, which could materially and adversely affect our business, stock price and ability to pay dividends.

We may change the dividend policy of our common stock in the future.

The decision to declare and pay dividends on our common stock in the future, as well as the timing, amount and composition of any such future dividends, will be at the sole discretion of our Board of Directors and will depend on such factors as the Board of Directors deems relevant and the dividend paid may vary from expected amounts. Any change in our dividend policy could adversely affect our business and the market price of our common stock. A recent Internal Revenue Service (“IRS”) revenue procedure allows us to satisfy the REIT income distribution requirement by distributing up to 90% of our dividends on our common stock in shares of our common stock in lieu of paying dividends entirely in cash. Although we reserve the right to utilize this procedure in the future, we currently have no intent to do so. In the event that we pay a portion of a dividend in shares of our common stock, taxable U.S. shareholders would be required to pay tax on the entire amount of the dividend, including the portion paid in shares of common stock, in which case such shareholders might have to pay the tax using cash from other sources. If a U.S. shareholder sells the stock it receives as a dividend in order to pay this tax, the sales proceeds may be less than the amount included in income with respect to the dividend, depending on the market price of our common stock at the time of the sale. Furthermore, with respect to non-U.S. shareholders, we may be required to withhold U.S. tax with respect to such dividend, including in respect of all or a portion of such dividend that is payable in stock. In addition, if a significant number of our shareholders sell shares of our common stock in order to pay taxes owed on dividends, such sales would put downward pressure on the market price of our common stock.

Changes in market conditions could adversely affect the market price of our publicly traded common stock.

As with other publicly traded securities, the market price of our publicly traded common stock depends on various market conditions, which may change from time-to-time. Among the market conditions that may affect the market price of our publicly traded common stock are the following:


	•	the reputation of REITs generally and the reputation of REITs with portfolios similar to us;

	•	the attractiveness of the securities of REITs in comparison to securities issued by other entities (including securities issued by other real estate companies);

	•	an increase in market interest rates, which may lead prospective investors to demand a higher distribution rate in relation to the price paid for publicly traded securities;

	•	our financial condition and performance and that of our significant tenants;

	•	the market’s perception of our growth potential and potential future earnings;

	•	the extent of institutional investor interest in us; and

	•	general economic and financial market conditions.

Inflation may adversely affect our financial condition and results of operations.

Although inflation has not materially impacted our results of operations in the recent past, increased inflation could have a more pronounced negative impact on any variable rate debt we incur in the future and on our results of operations. During times when inflation is greater than increases in rent, as provided for in our leases, rent increases may not keep up with the rate of inflation. Likewise, even though our triple net leases reduce our exposure to rising property expenses due to inflation, substantial inflationary pressures and increased costs may have an adverse impact on our tenants if increases in their operating expenses exceed increases in revenue, which may adversely affect the tenants’ ability to pay rent.

The loss of certain members of our management team could adversely affect our business.

We depend upon the skills and experience of our executive officers. Loss of the services of any of them could have a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. We do not have employment agreements with any of our executives.

Our accounting policies and methods are fundamental to how we record and report our financial position and results of operations, and they require management to make estimates, judgments and assumptions about matters that are inherently uncertain.

Our accounting policies and methods are fundamental to how we record and report our financial position and results of operations. We have identified several accounting policies as being critical to the presentation of our financial position and results of operations because they require management to make particularly subjective or complex judgments about matters that are inherently uncertain and because of the likelihood that materially different amounts would be recorded under different conditions or using different assumptions. Because of the inherent uncertainty of the estimates, judgments and assumptions associated with these critical accounting policies, we cannot provide any assurance that we will not make subsequent significant adjustments to our consolidated financial statements including those included in this Annual Report on Form 10-K. Estimates, judgments and assumptions underlying our consolidated financial statements include, but are not limited to, deferred rent receivable, income under direct financing leases, recoveries from state UST funds, environmental remediation costs, real estate including impairment charges related to the reduction in market value of our real estate, depreciation and amortization, impairment of long-lived assets, litigation, accrued expenses, income taxes and the allocation of the purchase price of properties acquired to the assets acquired and liabilities assumed. For example, we have made judgments regarding the level of environmental reserves and reserves for our deferred rent receivable relating to Marketing and the Marketing Leases and leases with our other tenants. We may be required to reserve additional amounts of the deferred rent receivable, record additional impairment charges related to our properties, or accrue for environmental liabilities as a result of the potential or actual modification or termination of the Marketing Leases or leases with our other tenants, which may result in material adjustments to the amounts recorded for these assets and liabilities. These judgments, assumptions and allocations may prove to be incorrect and our business, financial condition, revenues, operating expense,

results of operations, liquidity, ability to pay dividends or stock price may be materially adversely affected if that is the case. (For information regarding our critical accounting policies, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies”.)

Amendments to the Accounting Standards Codification made by the Financial Accounting Standards Board (the “FASB”) or changes in accounting standards issued by other standard-setting bodies may adversely affect our reported revenues, profitability or financial position.

Our financial statements are subject to the application of GAAP in accordance with the Accounting Standards Codification, which is periodically amended by the FASB. The application of GAAP is also subject to varying interpretations over time. Accordingly, we are required to adopt amendments to the Accounting Standards Codification or comply with revised interpretations that are issued from time-to-time by recognized authoritative bodies, including the FASB and the SEC. Those changes could adversely affect our reported revenues, profitability or financial position.

Terrorist attacks and other acts of violence or war may affect the market on which our common stock trades, the markets in which we operate, our operations and our results of operations.

Terrorist attacks or other acts of violence or war could affect our business or the businesses of our tenants or of Marketing or its parent. The consequences of armed conflicts are unpredictable, and we may not be able to foresee events that could have a material adverse effect on us. More generally, any of these events could cause consumer confidence and spending to decrease or result in increased volatility in the United States and worldwide financial markets and economy. Terrorist attacks also could be a factor resulting in, or a continuation of, an economic recession in the United States or abroad. Any of these occurrences could have a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

Item 1B. Unresolved Staff Comments

As of December 31, 2009, one comment remained unresolved as part of a periodic review commenced in 2004 by the Division of Corporation Finance of the SEC of our Annual Report on Form 10-K for the year ended December 31, 2003 pertaining to the SEC’s position that we must include the financial statements and summarized financial data of Marketing in our periodic filings, which Marketing contends is prohibited under the terms of the Master Lease. In June 2005, the SEC indicated that, unless we filed Marketing’s financial statements and summarized financial data with our periodic reports: (i) it would not consider our Annual Reports on Forms 10-K for the years beginning with fiscal 2000 to be compliant; (ii) it would not consider us to be current in our reporting requirements; (iii) it would not be in a position to declare effective any registration statements we may file for public offerings of our securities; and (iv) we should consider how the SEC’s conclusion impacts our ability to make offers and sales of our securities under existing registration statements and whether we would have a liability for such offers and sales made pursuant to registration statements that did not contain the financial statements of Marketing.

Subsequent to December 31, 2009, we have had communications with the SEC regarding the unresolved comment and as a result thereof we have included additional disclosures regarding Marketing, including supplemental condensed combining financial information in our financial statement footnotes. The financial information disclosure presents our results of operations, net assets and cash flows, allocated between Marketing, our other tenants and our general corporate functions. See “Footnote 11 – Supplemental Condensed Combining Financial Information in Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements.” The comment has been resolved.

Item 2. Properties

Nearly all of our properties are leased or sublet to petroleum distributors and retailers engaged in the sale of gasoline and other motor fuel products, convenience store products and automotive repair services who are responsible for managing the operations conducted at these properties and for the payment of taxes, maintenance, repair, insurance and other operating expenses relating to our properties. In those instances where we determine that the best use for a property is no longer as a retail motor fuel outlet, we will seek an alternative tenant or buyer for the property. We lease or sublet approximately twenty

of our properties under similar lease terms primarily for uses such as fast food restaurants, automobile sales and other retail purposes.

The following table summarizes the geographic distribution of our properties at December 31, 2009. The table also identifies the number and location of properties we lease from third-parties and which Marketing leases from us under the Marketing Leases. In addition, we lease four thousand square feet of office space at 125 Jericho Turnpike, Jericho, New York, which is used for our corporate headquarters, which we believe will remain suitable and adequate for such purposes for the immediate future.


	OWNED BY GETTY REALTY		LEASED BY GETTY REALTY		TOTAL PROPERTIES BY STATE	PERCENT OF TOTAL PROPERTIES

	MARKETING AS TENANT (1)	OTHER TENANTS	MARKETING AS TENANT	OTHER TENANTS

New York	236	31	64	5	336	31.3	%
Massachusetts	127	1	21	—	149	13.9
New Jersey	106	7	21	6	140	13.1
Pennsylvania	104	5	1	4	114	10.6
Connecticut	60	28	13	10	111	10.4
Maryland	4	39	—	2	45	4.2
Virginia	3	24	4	1	32	3.0
New Hampshire	25	3	3	—	31	2.9
Maine	18	1	2	—	21	2.0
Rhode Island	15	1	2	—	18	1.7
Texas	—	17	—	—	17	1.6
North Carolina	—	11	—	—	11	1.0
Delaware	9	—	1	—	10	0.9
Hawaii	—	10	—	—	10	0.9
California	—	8	—	1	9	0.8
Florida	—	6	—	—	6	0.6
Ohio	—	4	—	—	4	0.4
Arkansas	—	3	—	—	3	0.3
Illinois	—	2	—	—	2	0.2
North Dakota	—	1	—	—	1	0.1
Vermont	1	—	—	—	1	0.1

Total	708	202	132	29	1,071	100.0	%


(1)	Includes nine terminal properties owned in New York, New Jersey, Connecticut and Rhode Island.

The properties that we lease have a remaining lease term, including renewal option terms, averaging over eleven years. The following table sets forth information regarding lease expirations, including renewal and extension option terms, for properties that we lease from third parties:


CALENDAR YEAR	NUMBER OF LEASES EXPIRING	PERCENT OF TOTAL LEASED PROPERTIES		PERCENT OF TOTAL PROPERTIES

2010	10	6.21		0.93
2011	9	5.59		0.84
2012	13	8.08		1.22
2013	4	2.48		0.37
2014	3	1.86		0.28

Subtotal	39	24.22		3.64
Thereafter	122	75.78		11.39

Total	161	100.00	%	15.03	%

We have rights-of-first refusal to purchase or lease one hundred twenty-nine of the properties we lease. Although there can be no assurance regarding any particular property, historically we generally have been successful in renewing or entering into new leases when lease terms expire. Approximately 68% of our leased properties are subject to automatic renewal or extension options.

For the year ended December 31, 2009 we received $82.8 million of lease payments with respect to 1,061 average rental properties held during the year resulting in an average annual rent received of $78,000 per rental property. For the year ended December 31, 2008 we received $81.0 million of lease payments with respect to 1,078 average rental properties held during the year resulting in an average annual rent received of $75,100 per rental property.

Rental unit expirations and the current annualized contracted rent as of December 31, 2009, are as follows (in thousands, except for the number of rental units data):


			CURRENT ANNUALIZED CONTRACTUAL RENT (a)

CALENDAR YEAR	NUMBER OF RENTAL UNITS EXPIRING (b)		MARKETING		OTHER TENANTS		TOTAL		PERCENTAGE OF TOTAL ANNUALIZED RENT

2010		49	$	1,360	$	467	$	1,827	2.15
2011		25		824		167		991	1.17
2012		45		1,269		582		1,851	2.18
2013		22		625		842		1,467	1.73
2014		31		697		1,464		2,161	2.55
2015		781		55,070		91		55,161	65.03
2016		5		—		332		332	0.39
2017		5		—		445		445	0.53
2018		12		—		1,108		1,108	1.31
2019		70		—		5,134		5,134	6.05
Thereafter		130		42		14,304		14,346	16.91

Total		1,175	$	59,887	$	24,936	$	84,823	100.00	%


	(a)	Represents the monthly contractual rent due from tenants under existing leases as of December 31, 2009 multiplied by twelve. This amount excludes real estate tax reimbursements which are billed to the tenant when paid.

	(b)	Rental units include properties subdivided into multiple premises with separate tenants. Rental units also include individual properties comprising a single “premises” as such term is defined under a unitary master lease related to such properties. With respect to a unitary master lease that includes properties subject to third party leases, the expiration dates for rental units refers to the dates that the underlying third party leases expire, not the expiration date of the unitary master lease itself.

In the opinion of our management, our owned and leased properties are adequately covered by casualty and liability insurance. In addition, we require our tenants to provide insurance for all properties they lease from us, including casualty, liability, fire and extended coverage in amounts and on other terms satisfactory to us. We have no plans for material improvements to any of our properties. However, our tenants frequently make improvements to the properties leased from us at their expense. We are not aware of any material liens or encumbrances on any of our properties.

We lease eight hundred thirty-one retail motor fuel and convenience store properties and nine petroleum distribution terminals to Marketing under the Marketing Leases. The Master Lease is a unitary lease and has an initial term expiring in 2015, and generally provides Marketing with three renewal options of ten years each and a final renewal option of three years and ten months extending to 2049. The Master Lease is a unitary lease and, therefore, Marketing’s exercise of any renewal option can only be exercised on an “all or nothing” basis. The Marketing Leases are “triple-net” leases, under which Marketing is responsible for the payment of taxes, maintenance, repair, insurance and other operating expenses. As permitted under the terms of our leases with Marketing, Marketing can generally use each property for any lawful purpose, or for no purpose whatsoever. We believe that as of December 31, 2009, Marketing had removed, or has scheduled removal of the gasoline tanks and related equipment at approximately one hundred fifty, or 18%, of our properties and we also believe that most of these properties are either vacant or provide negative or marginal contribution to Marketing’s results. (For additional information regarding the portion of our financial results that are attributable to Marketing, see Note 11 in “Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements.” For additional information regarding

Marketing and the Marketing Leases, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing Leases”.)

If Marketing fails to pay rent, taxes or insurance premiums when due under the Marketing Leases and the failure is not cured by Marketing within a specified time after receipt of notice, we have the right to terminate the Marketing Leases and to exercise other customary remedies against Marketing. If Marketing fails to comply with any other obligation under the Master Lease after notice and opportunity to cure, we do not have the right to terminate the Master Lease. In the event of Marketing’s default where we do not have the right to terminate the Master Lease, our available remedies under the Master Lease are to seek to obtain an injunction or other equitable relief requiring Marketing to comply with its obligations under the Master Lease and to recover damages from Marketing resulting from the failure. If any lease we have with a third-party landlord for properties that we lease to Marketing is terminated as a result of our default and the default is not caused by Marketing, we have agreed to indemnify Marketing for its losses with respect to the termination. Marketing has the right-of-first refusal to purchase any property leased to Marketing under the Marketing Leases that we decide to sell.

We have also agreed to provide limited environmental indemnification to Marketing, capped at $4.25 million, for certain pre-existing conditions at six of the terminals we own and lease to Marketing. Under the agreement, Marketing is obligated to pay the first $1.5 million of costs and expenses incurred in connection with remediating any pre-existing terminal condition, Marketing will share equally with us the next $8.5 million of those costs and expenses and Marketing is obligated to pay all additional costs and expenses over $10.0 million. We have accrued $0.3 million as of December 31, 2009 and 2008 in connection with this indemnification agreement. Under the Master Lease, we continue to have additional ongoing environmental remediation obligations at one hundred eighty-seven scheduled sites and our agreements with Marketing provide that Marketing otherwise remains liable for all environmental matters. (For additional information regarding Marketing and the Marketing Leases, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing Leases”.)

Item 3. Legal Proceedings

The Company is engaged in a number of legal proceedings, many of which we consider to be routine and incidental to our business. The following is a description of material legal proceedings, including those involving private parties and governmental authorities under federal, state and local laws regulating the discharge of materials into the environment. We are vigorously defending all of the legal proceedings involving the Company, including each of the legal proceedings matters listed below.

In April 2003, our subsidiary, Leemilt’s Petroleum Inc., was named as a defendant, along with Amoco Oil Co., BP Corporation North America, CITGO Petroleum Corporation, Exxon Mobil Corp., Sunoco, Inc., Tosco Corporation, Valero Energy Inc., and others, in a complaint seeking class action classification, filed by three individuals, on behalf of themselves and others similarly situated, in the New York Supreme Court in Dutchess County, NY, arising out of alleged contamination of ground water with methyl tertiary butyl ether (a fuel derived from methanol, commonly referred to as “MTBE”). We served an answer to the complaint in which we denied liability and asserted affirmative defenses. The plaintiffs have not responded to our answer and there has been no activity in the case since it was commenced.

In September 2003, we were notified by the New Jersey Department of Environmental Protection (the “NJDEP”) that we may be responsible for damages to natural resources (“NRDs”) by reason of a petroleum release at a retail motor fuel property formerly operated by us in Egg Harbor, NJ. We have remediated the resulting contamination at the property in accordance with a plan approved by the NJDEP and continue required sampling of monitoring wells that were required to be installed. In addition, we responded to the notice and, in late 2003, we met with the NJDEP to determine whether, and to what extent, we may be responsible for NRDs regarding this property and other properties formerly supplied by us with gasoline in New Jersey. Since our meeting with the NJDEP we have had no communication with the NJDEP arising from this matter regarding NRDs.

In November 2003, we received a demand from the State of New York for reimbursement of cleanup and removal costs claimed to have been incurred by the New York Environmental Protection and Spill Compensation Fund regarding contamination it alleges emanated from one of our retail motor fuel properties in 1997. We responded to the State’s demand and denied responsibility for reimbursement of such costs. In September 2004, the State of New York commenced an action against us and Costa Gas Station, Inc., The Ingraham Bedell Corporation, Exxon Mobil Corporation, Shell Oil Company,

Shell Oil Products Company, Motiva Enterprises, LLC, and related parties, in New York Supreme Court in Albany County seeking recovery of such costs as well as additional costs and future costs for remediation, and interest and penalties. Discovery in this case is ongoing.

In October 2007, the Company received a demand from the State of New York to pay the costs allegedly arising from investigation and remediation of petroleum spills that occurred at a property formerly owned by us and taken by eminent domain by the State of New York in 1991. No formal legal action has yet been commenced by the State.

In September 2008, we received a directive and notice of violation from the NJDEP calling for a remedial investigation and cleanup, to be conducted by us and Gary and Barbara Galliker, individually and trading Millstone Auto Service, Auto Tech, and other named parties, of petroleum-related contamination found at a retail motor fuel property. We did not own or lease this property, but did supply gas to the operator of this property in 1985 and 1986. We have responded to the NJDEP, denying liability, and we have also tendered the matter to Marketing for defense and indemnification under the Reorganization and Distribution Agreement between Getty Petroleum Corp. (n/k/a/ Getty Properties Corp.) and Marketing dated as of February 1, 1997 (the “Spin-Off Agreement”). Marketing has denied responsibility for this matter. In November, 2009, the NJDEP issued an Administrative Order and Notice of Civil Administrative Penalty Assessment (the “Order and Assessment”) to the Company, Marketing and Gary and Barbara Galliker, individually and trading as Millstone Auto Service. Both Marketing and the Company have filed requests for a hearing to contest the allegations of the Order and Assessment. The hearing request is still pending. For additional information regarding Marketing and the Marketing Leases (as defined below), see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing Leases”.)

In November 2009, an action was commenced by the State of New York in the Supreme Court, Albany County, seeking the recovery of costs incurred in remediating alleged petroleum contamination down gradient of a gasoline station formerly owned by us, and gasoline stations that were allegedly owned or operated by other named defendants, including M&A Realty, Inc., Gas Land Petroleum, Inc., and Mid-Valley Oil Company. The Company has tendered the matter to M&A Realty Inc. for defense and indemnification as relates to discharges of petroleum that occurred on or after July of 1994 at the site which is the subject of allegations against the Company. This site was leased by the Company to M & A Realty Inc. in 1994 and sold to M & A Realty Inc. in 2002. M&A Realty Inc. has demanded that the Company defend and indemnify M&A Realty Inc. for contamination at this site as of 1994. The Company has answered the complaint denying liability and asserting affirmative defenses and cross claims against co-defendants. Discovery is ongoing.

MTBE Litigation

From October 2003 through September 2009, we were named as a defendant in lawsuits brought on behalf of private and public water providers and governmental agencies in Connecticut, Florida, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Vermont, Virginia, and West Virginia. These cases allege various theories of liability due to contamination of groundwater with MTBE as the basis for claims seeking compensatory and punitive damages. We have settled one case and have been dismissed from five of the cases initially filed against us. Presently, fifty-three of these MTBE cases remain pending against us. Each of these cases name as defendants approximately fifty petroleum refiners, manufacturers, distributors and retailers of MTBE, or gasoline containing MTBE, including Irving Oil Corporation, Mobil Oil Corporation, Sunoco, Inc., Texaco, Inc., Tosco Corporation, Unocal Corporation, Valero Energy Corporation, Marathon Oil Company, Shell Oil Company, Giant Yorktown, Inc., BP Amoco Chemical Company, Inc., Atlantic Richfield Company, Coastal Oil New England, Inc., Chevron Texaco Corporation, Amerada Hess Corp., Chevron U.S.A., Inc., CITGO Petroleum Corporation, ConocoPhillips Company, Exxon Mobil Corporation, Getty Petroleum Marketing, Inc., and Gulf Oil Limited Partnership.

Pursuant to consolidation procedures under federal law, most of the MTBE cases originally filed in various state and federal courts were transferred to the United States District Court for the Southern District of New York for coordinated Multi-District Litigation proceedings. We are presently named as a defendant in thirty-nine out of more than one hundred cases that have been consolidated in this Multi-District Litigation. We are also named as a defendant in fourteen related MTBE cases pending in the Supreme Court of New York, Nassau County.

The Federal District Court initially designated three individual cases as “focus” cases for discovery and trial purposes. We were a named as a defendant in two of these three initial focus cases. The two focus cases in which we were a named defendant, brought on behalf of the Suffolk County Water Authority and United Water of New York, had been set for trial in

September 2008. Prior to the scheduled trial date, a majority of the primary defendants entered into global settlement agreements which settled one hundred two cases brought by the same law firm on behalf of various plaintiffs. Although we were not a party to these global settlements, the two focus cases in which we were a named defendant were included in these settlements. As a result of these multi-party settlements, the Court vacated the September 2008 trial date for the two initial focus cases in which we were a named defendant. A new trial date for these two focus cases has not yet been rescheduled. We remain a defendant in a total of twenty-seven out of the one hundred two individual cases brought by the same firm and previously settled by other named defendants. Should these two focus cases or any of the other twenty-five cases represented by this firm proceed to trial, the Court has indicated that trials would be scheduled stating in June 2010.

The Court has designated two additional cases as focus cases for discovery and trial purposes. These cases were brought on behalf of water authorities of the Village of Hempstead and the Village of West Hempstead. These cases are presently scheduled for trial in June 2010. We believe that several defendants have settled these two focus cases as part of a multi-case settlement comprising a total of twenty-five cases brought by the same law firm (a different law firm from that indicated above) on behalf of various plaintiffs. We remain a defendant in the Village of Hempstead and the Village of West Hempstead focus cases, which are among twenty-five total cases brought by this other law firm.

In addition to the above described cases, there is one other MTBE case in the consolidated Multi-District Litigation that is pending against us. This case is brought by various governmental agencies of the State of New Jersey, including the NJDEP, and names many refiners, manufacturers, distributors and retailers as defendants. In December 2008, the Court designated this case as a focus case. This case remains in its preliminary stages.

We have tendered defense and indemnification to Marketing and its insurers under the Spin-Off Agreement and the Master Lease. In 2009, we provided litigation reserves of $2.3 million relating to a majority of the MTBE cases pending against us. However, we are still unable to estimate our liability for a minority of the cases pending against us. Further, notwithstanding that we have provided a litigation reserve as to certain of these cases, there remains uncertainty as to the accuracy of the allegations in the MTBE cases as they relate to us, our defenses to the claims, our rights to indemnification or contribution from Marketing, and the aggregate possible amount of damages for which we may be held liable.

Matters related to our Newark, New Jersey Terminal and the Lower Passaic River

In September 2003, we received a directive (the “Directive”) issued by the NJDEP under the New Jersey Spill Compensation and Control Act. The Directive indicated that we are one of approximately sixty-six potentially responsible parties for alleged NRDs resulting from the discharges of hazardous substances along the lower Passaic River (the “Lower Passaic River”). Other named recipients of the Directive are 360 North Pastoria Environmental Corporation, Amerada Hess Corporation, American Modern Metals Corporation, Apollo Development and Land Corporation, Ashland Inc., AT&T Corporation, Atlantic Richfield Assessment Company, Bayer Corporation, Benjamin Moore & Company, Bristol Myers-Squibb, Chemical Land Holdings, Inc., Chevron Texaco Corporation, Diamond Alkali Company, Diamond Shamrock Chemicals Company, Diamond Shamrock Corporation, Dilorenzo Properties Company, Dilorenzo Properties, L.P., Drum Service of Newark, Inc., E.I. Dupont De Nemours and Company, Eastman Kodak Company, Elf Sanofi, S.A., Fine Organics Corporation, Franklin-Burlington Plastics, Inc., Franklin Plastics Corporation, Freedom Chemical Company, H.D. Acquisition Corporation, Hexcel Corporation, Hilton Davis Chemical Company, Kearny Industrial Associates, L.P., Lucent Technologies, Inc., Marshall Clark Manufacturing Corporation, Maxus Energy Corporation, Monsanto Company, Motor Carrier Services Corporation, Nappwood Land Corporation, Noveon Hilton Davis Inc., Occidental Chemical Corporation, Occidental Electro-Chemicals Corporation, Occidental Petroleum Corporation, Oxy-Diamond Alkali Corporation, Pitt-Consol Chemical Company, Plastics Manufacturing Corporation, PMC Global Inc., Propane Power Corporation, Public Service Electric & Gas Company, Public Service Enterprise Group, Inc., Purdue Pharma Technologies, Inc., RTC Properties, Inc., S&A Realty Corporation, Safety-Kleen Envirosystems Company, Sanofi S.A., SDI Divestiture Corporation, Sherwin Williams Company, SmithKline Beecham Corporation, Spartech Corporation, Stanley Works Corporation, Sterling Winthrop, Inc., STWB Inc., Texaco Inc., Texaco Refining and Marketing Inc., Thomasset Colors, Inc., Tierra Solution, Incorporated, Tierra Solutions, Inc., and Wilson Five Corporation.

The Directive provided, among other things, that the recipients thereof must conduct an assessment of the natural resources that have been injured by the discharges into the Lower Passaic River and must implement interim compensatory restoration for the injured natural resources. NJDEP alleges that our liability arises from alleged discharges originating from our Newark, New Jersey Terminal site. We responded to the Directive by asserting that we were not liable. There has been no material activity and/or communications by NJDEP with respect to the Directive since early after its issuance.

Effective in June 2004, the United States Environmental Protection Agency (“EPA”) entered into an Administrative Order on Consent (“AOC”) with thirty-one parties (some of which are also named in the Directive) who agreed to fund a portion of the costs for EPA to perform a Remedial Investigation and Feasibility Study (“RI/FS”) for the Lower Passaic River. The RI/FS is intended to address the investigation and evaluation of alternative remedial actions with respect to alleged damages to the Lower Passaic River. After being notified by the EPA that they considered us to be a potentially responsible party, we reserved our defenses to liability, became a party to an amended AOC, and joined the Cooperating Parties Group (“CPG”), which consists of the parties which had executed the initial AOC and other parties (including Chevron/Texaco). Pursuant to the amended AOC and subsequent amendments adding additional parties, the CPG has agreed to take over performance of the RI/FS from EPA. The RI/FS does not resolve liability issues for remedial work or restoration of, or compensation for, natural resource damages to the Lower Passaic River, which are not known at this time. As to such matters, separate proceedings or activities are currently ongoing.

In a related action, in December 2005, the State of New Jersey brought suit in the Superior Court of New Jersey, Law Division, against certain parties to the Directive, Occidental Chemical Corporation, Tierra Solutions, Inc., Maxus Energy Corporation and related entities which the State alleges are responsible for pollution of the Passaic River from a former Diamond Alkali manufacturing plant and seeking recovery of alleged damages incurred and to be incurred on account of alleged discharges of hazardous substances to the Passaic River. In February 2009, certain of these defendants filed third-party complaints against approximately three hundred additional parties, including us as well as the other members of the CPG, seeking contribution for a pro-rata share of response costs, cleanup and removal costs, and other damages. The Company has answered the complaint, denying responsibility for any discharges of hazardous substances released into the Lower Passaic River. On December 9, 2009, the court entered an order under which a Special Master is tasked with facilitating discussions for the purpose of designing an alternative dispute resolution process for achieving a global resolution of the Action. The Special Master and certain party representatives are in the process of developing a potential framework for such an alternative dispute resolution process.

We have made a demand upon Chevron/Texaco for indemnity under certain agreements between the Company and Chevron/Texaco that allocate environmental liabilities for the Newark Terminal Site between the parties. In response, Chevron/Texaco has asserted that the proceedings and claims are still not yet developed enough to determine the extent to which indemnities apply. The Company and Chevron/Texaco are engaged in discussions regarding the Company’s demands for indemnification, and, to facilitate said discussions, in October, 2009 entered into a Tolling/Standstill Agreement which tolls all claims by and among the Company and Chevron/Texaco that relate to the various Lower Passaic River matters from May 8, 2007, until either party terminates such Tolling/Standstill Agreement.

Our ultimate liability, if any, in the pending and possible future proceedings pertaining to the Lower Passaic River is uncertain and subject to numerous contingencies which cannot be predicted and the outcome of which are not yet known.

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Capital Stock

Our common stock is traded on the New York Stock Exchange (symbol: “GTY”). There were approximately 13,000 shareholders of our common stock as of March 16, 2010, of which approximately 1,300 were holders of record. The price range of our common stock and cash dividends declared with respect to each share of common stock during the years ended December 31, 2009 and 2008 was as follows:


	PRICE RANGE				CASH DIVIDENDS PER SHARE

QUARTER ENDED	HIGH		LOW

March 31, 2008	$	28.58	$	13.33		$	.4650
June 30, 2008		19.04		14.34			.4650
September 30, 2008		23.12		13.12			.4700
December 31, 2008		22.40		13.35			.4700
March 31, 2009		21.87		13.25			.4700
June 30, 2009		20.99		16.36			.4700
September 30, 2009		26.32		18.61			.4750
December 31, 2009		25.63		21.50			.4750

For a discussion of potential limitations on our ability to pay future dividends see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources”.

Issuer Purchases of Equity Securities

None

Sales of Unregistered Securities

None

Stock Performance Graph

We have chosen as our Peer Group the following companies: National Retail Properties, Entertainment Properties Trust, Realty Income Corp. and Hospitality Properties Trust. We have chosen these companies as our Peer Group because a substantial segment of each of their businesses is owning and leasing commercial properties. We cannot assure you that our stock performance will continue in the future with the same or similar trends depicted in the graph above. We do not make or endorse any predictions as to future stock performance.

This performance graph and related information shall not be deemed filed for the purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that Section and shall not be deemed to be incorporated by reference into any filing that we make under the Securities Act or the Exchange Act.

(LINE GRAPH)


	12/31/2004		12/31/2005		12/31/2006		12/31/2007		12/31/2008		12/31/2009
Getty Realty Corp.		100.00		97.61		122.09		112.75		98.63		120.99
Standard & Poors 500		100.00		103.00		117.03		121.16		74.53		92.01
Peer Group		100.00		93.63		123.44		109.86		82.57		110.65

Assumes $100 invested at the close of trading 12/04 in Getty Realty Corp. common stock, Standard & Poors 500, and Peer Group.

*Cumulative total return assumes reinvestment of dividends.

Item 6. Selected Financial Data

GETTY REALTY CORP. AND SUBSIDIARIES
SELECTED FINANCIAL DATA
(in thousands, except per share amounts and number of properties)


	FOR THE YEARS ENDED DECEMBER 31,
	2009 (a)			2008			2007 (b)			2006			2005

OPERATING DATA:
Revenues from rental properties	$	84,539		$	82,802		$	79,207		$	72,491		$	71,282
Earnings before income taxes and discontinued operations		41,424			38,767			27,842	(c)		40,927			42,846
Income tax benefit (d)		—			—			—			700			1,494

Earnings from continuing operations		41,424			38,767			27,842			41,627			44,340
Earnings from discontinued operations		5,625			3,043			6,052	(c)		1,098			1,108

Net earnings		47,049			41,810			33,894			42,725			45,448
Diluted earnings per common share:
Earnings from continuing operations		1.67			1.57			1.12			1.68			1.79
Net earnings		1.90			1.69			1.37			1.73			1.84
Diluted weighted-average common shares outstanding		24,767			24,767			24,769			24,752			24,736
Cash dividends declared per share		1.89			1.87			1.85			1.82			1.76
FUNDS FROM OPERATIONS AND ADJUSTED FUNDS FROM OPERATION (e):
Net earnings		47,049			41,810			33,894			42,725			45,448

Depreciation and amortization of real estate assets		11,027			11,875			9,794			7,883			8,113
Gains on dispositions of real estate		(5,467	)		(2,787	)		(6,179	)		(1,581	)		(1,309	)

Funds from operations		52,609			50,898			37,509			49,027			52,252
Revenue Recognition Adjustments		(2,065	)		(2,593	)		(4,159	)		(3,010	)		(4,170	)
Allowance for deferred rental revenue		—			—			10,494			—			—
Impairment charges		1,135			—			—			—			—
Income tax benefit (d)		—			—			—			(700	)		(1,494	)

Adjusted funds from operations		51,679			48,305			43,844			45,317			46,588
BALANCE SHEET DATA (AT END OF YEAR):
Real estate before accumulated depreciation and amortization	$	503,874		$	473,567		$	474,254		$	383,558		$	370,495
Total assets		432,872			387,813			396,911			310,922			301,468
Debt		175,570			130,250			132,500			45,194			34,224
Shareholders’ equity		207,669			205,897			212,178			225,575			227,883
NUMBER OF PROPERTIES:
Owned		910			878			880			836			814
Leased		161			182			203			216			241

Total properties		1,071			1,060			1,083			1,052			1,055


(a)	Includes (from the date of the acquisition) the effect of the $49.0 million acquisition of the real estate assets and improvements of thirty-six convenience store properties from White Oak Petroleum LLC which were acquired on September 25, 2009.

(b)	Includes (from the date of the acquisition) the effect of the $84.5 million acquisition of convenience stores and gas station properties from FF-TSY Holding Company II LLC (successor to Trustreet Properties, Inc.) which was substantially completed by the end of the first quarter of 2007.

(c)	Includes the effect of a $10.5 million non-cash deferred rent receivable reserve, $10.2 million of which is included in earnings from continuing operations and $0.3 million of which is included in earnings from discontinued operations, based on the deferred rent receivable recorded as of December 31, 2007 related to approximately 40% of the properties then under leases with our primary tenant, Getty Petroleum Marketing, Inc. (For additional information regarding Marketing and the Marketing Leases, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — General — Marketing and the Marketing Leases”.)


(d)	The years ended 2006 and 2005 include income tax benefits recognized due to the elimination of, or reduction in, amounts accrued for uncertain tax positions related to being taxed as a C-corp. prior to our election to be taxed as a real estate investment trust (“REIT”) under the federal income tax laws in 2001. Income taxes have not had a significant impact on our earnings since we first elected to be treated as a REIT.

(e)	In addition to measurements defined by accounting principles generally accepted in the United States of America (“GAAP”), our management also focuses on funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) to measure our performance. FFO is generally considered to be an appropriate supplemental non-GAAP measure of the performance of real estate investment trusts (“REITs”). FFO is defined by the National Association of Real Estate Investment Trusts as net earnings before depreciation and amortization of real estate assets, gains or losses on dispositions of real estate, (including such non-FFO items reported in discontinued operations), extraordinary items, and cumulative effect of accounting change. Other REITs may use definitions of FFO and/or AFFO that are different than ours and; accordingly, may not be comparable.

	We believe that FFO and AFFO are helpful to investors in measuring our performance because both FFO and AFFO exclude various items included in GAAP net earnings that do not relate to, or are not indicative of, our fundamental operating performance. FFO excludes various items such as gains or losses from property dispositions and depreciation and amortization of real estate assets. In our case, however, GAAP net earnings and FFO typically include the impact of deferred rental revenue (straight-line rental revenue), the net amortization of above-market and below-market leases and income recognized from direct financing leases on its recognition of revenue from rental properties (collectively the “Revenue Recognition Adjustments”), as offset by the impact of related collection reserves. GAAP net earnings and FFO from time to time may also include impairment charges and/or income tax benefits. Deferred rental revenue results primarily from fixed rental increases scheduled under certain leases with our tenants. In accordance with GAAP, the aggregate minimum rent due over the current term of these leases are recognized on a straight-line (or an average) basis rather than when the payment is contractually due. The present value of the difference between the fair market rent and the contractual rent for in-place leases at the time properties are acquired is amortized into revenue from rental properties over the remaining lives of the in-place leases. Income from direct financing leases is recognized over the lease term using the effective interest method which produces a constant periodic rate of return on the net investment in the leased property. Impairment of long-lived assets represents charges taken to write-down real estate assets to fair value estimated when events or changes in circumstances indicate that the carrying amount of the property may not be recoverable. In prior periods, income tax benefits have been recognized due to the elimination of, or a net reduction in, amounts accrued for uncertain tax positions related be being taxed as a C-corp., rather than as a REIT, prior to 2001 (see note (d) above).

	Management pays particular attention to AFFO, a supplemental non-GAAP performance measure that we define as FFO less Revenue Recognition Adjustments, impairment charges and income tax benefit. In management’s view, AFFO provides a more accurate depiction than FFO of our fundamental operating performance related to: (i) the impact of scheduled rent increases from operating leases; (ii) the rental revenue from acquired in-place leases; (iii) the impact of rent due from direct financing leases, (iv) our rental operating expenses (exclusive of impairment charges); and (v) our election to be treated as a REIT under the federal income tax laws beginning in 2001. Neither FFO nor AFFO represent cash generated from operating activities calculated in accordance with GAAP and therefore these measures should not be considered an alternative for GAAP net earnings or as a measure of liquidity.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the “Cautionary Note Regarding Forward-Looking Statements” on page 2; the risks and uncertainties described in “Item 1A. Risk Factors”; the selected financial data in “Item 6. Selected Financial Data”; and the consolidated financial statements and related notes in “Item 8. Financial Statements and Supplementary Data”.

GENERAL

Real Estate Investment Trust

We are a real estate investment trust (“REIT”) specializing in the ownership and leasing of retail motor fuel and convenience store properties and petroleum distribution terminals. We elected to be treated as a REIT under the federal income tax laws beginning January 1, 2001. As a REIT, we are not subject to federal corporate income tax on the taxable income we distribute to our shareholders. In order to continue to qualify for taxation as a REIT, we are required, among other things, to distribute at least ninety percent of our taxable income to shareholders each year.

Retail Petroleum Marketing Business

We lease or sublet our properties primarily to distributors and retailers engaged in the sale of gasoline and other motor fuel products, convenience store products and automotive repair services. These tenants are responsible for managing the operations conducted at these properties and for the payment of taxes, maintenance, repair, insurance and other operating expenses relating to our properties. Our tenants’ financial results are largely dependent on the performance of the petroleum marketing industry, which is highly competitive and subject to volatility. In those instances where we determine that the best use for a property is no longer as a retail motor fuel outlet, we will seek an alternative tenant or buyer for the property. We lease or sublet approximately twenty of our properties for uses such as fast food restaurants, automobile sales and other retail purposes. (See “Item 1. Business — Real Estate Business” and “Item 2. Properties” for additional information regarding our real estate business and our properties.) (For information regarding factors that could adversely affect us relating to our lessees, including our primary tenant, Getty Petroleum Marketing Inc., see “Item 1A. Risk Factors”.)

Marketing and the Marketing Leases

As of December 31, 2009, we leased eight hundred forty properties, or 78% of our one thousand seventy-one properties, on a long-term triple-net basis to Getty Petroleum Marketing Inc. (“Marketing”), a wholly-owned subsidiary of OAO LUKoil (“Lukoil”), one of the largest integrated Russian oil companies. Eight hundred thirty of the properties we lease to Marketing are leased under a unitary master lease (the “Master Lease”) with an initial term effective through December 2015. The Master Lease is a unitary lease and, therefore, Marketing’s exercise of any renewal option can only be on an “all or nothing” basis. Ten of the properties we lease to Marketing are leased under supplemental leases with initial terms of varying expiration dates (collectively with the Master Lease, the “Marketing Leases”).

Our financial results are materially dependent upon the ability of Marketing to meet its rental and environmental obligations under the Marketing Leases. Marketing’s financial results depend on retail petroleum marketing margins from the sale of refined petroleum products and rental income from its subtenants. Marketing’s subtenants either operate their gas stations, convenience stores, automotive repair services or other businesses at our properties or are petroleum distributors who may operate our properties directly and/or sublet our properties to the operators. Since a substantial portion of our revenues (71% for the year ended December 31, 2009) are derived from the Marketing Leases, any factor that adversely affects Marketing’s ability to meet its obligations under the Marketing Leases may have a material adverse effect on our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price. (For additional information regarding the portion of our financial results that are attributable to Marketing, see Note 11 in “Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements.”) Marketing has made all required monthly rental payments under the Marketing Leases when due through March 2010, although there can be no assurance that it will continue to do so.

the ordinary course through the terms of the Marketing Leases unless it shows significant improvement in its financial results, generates sufficient liquidity through the sale of assets or otherwise, or receives financial support from Lukoil, its parent company.

We believe that Marketing is exiting the direct-supplied retail gasoline business by entering into subleases with petroleum distributors who supply their own petroleum products to the properties leased from us by Marketing. Approximately two hundred fifty retail properties, comprising substantially all of the properties in New England that we lease to Marketing, have been subleased by Marketing to a single distributor. These properties are in the process of being rebranded BP stations and are being supplied petroleum products under a supply contract with BP. In addition, we believe that Marketing recently entered into a sublease with a single distributor in New Jersey covering approximately eighty-five of our properties. We believe that Marketing is seeking subtenants for other significant portions of the portfolio of properties it leases from us.

In connection with its restructuring, Marketing eliminated debt which had been guaranteed by Lukoil with proceeds from the sale of assets to Lukoil affiliates and with financial support from Lukoil, which we believe increased Marketing’s liquidity and improved its balance sheet. However, we cannot predict whether the restructuring announced by Marketing will stem Marketing’s recent history of significant annual operating losses, and whether Marketing will continue to be dependent on financial support from Lukoil to meet its obligations as they become due through the terms of the Marketing Leases. We continue to believe that to the extent Marketing requires continued financial support from Lukoil, it is probable that Lukoil will continue to provide such support. Lukoil is not, however, a guarantor of the Marketing Leases. Even though Marketing is a wholly-owned subsidiary of Lukoil, and Lukoil has provided capital to Marketing in the past, there can be no assurance that Lukoil will provide financial support or additional capital to Marketing in the future. It is reasonably possible that our beliefs regarding the likelihood of Lukoil providing continuing financial support to Marketing will prove to be incorrect or will change as circumstances change. If Marketing should fail to meet its financial obligations to us, including payment of rent, such default could lead to a protracted and expensive process for retaking control of our properties. In addition to the risk of disruption in rent receipts, we are subject to the risk of incurring real estate taxes, maintenance, environmental and other expenses at properties subject to the Marketing Leases.

From time to time we have held discussions with representatives of Marketing regarding potential modifications to the Marketing Leases. These efforts have been unsuccessful to date as we have not yet reached a common understanding with Marketing that would form a basis for modification of the Marketing Leases. From time to time, however, we have been able to agree with Marketing on terms to allow for removal of individual properties from the Marketing Leases as mutually beneficial opportunities arise. We intend to continue to pursue the removal of individual properties from the Marketing Leases, and we remain open to removal of groups of properties; however, there is no fixed agreement in place providing for removal of properties from the Marketing Leases. Accordingly, the removal of properties from the Marketing Leases is subject to negotiation on a case-by-case basis. If Marketing ultimately determines that its business strategy is to exit all or a portion of the properties it leases from us, it is our intention to cooperate with Marketing in accomplishing those objectives if we determine that it is prudent for us to do so. Any modification of the Marketing Leases that removes a significant number of properties from the Marketing Leases would likely significantly reduce the amount of rent we receive from Marketing and increase our operating expenses. We cannot accurately predict if, or when, the Marketing Leases will be modified; what composition of properties, if any, may be removed from the Marketing Leases as part of any such modification; or what the terms of any agreement for modification of the Marketing Leases may be. We also cannot accurately predict what actions Marketing or Lukoil may take, and what our recourse may be, whether the Marketing Leases are modified or not.

are the fee or leasehold owner of the properties subject to the Marketing Leases and the owner of the Getty® brand, and have prior experience with tenants who operate their gas stations, convenience stores, automotive repair services or other businesses at our properties, in the event that properties are removed from the Marketing Leases, we cannot accurately predict if, when, or on what terms such properties could be re-let or sold.

As permitted under the terms of the Marketing Leases, Marketing generally can, subject to any contrary terms under applicable third party leases, use each property for any lawful purpose, or for no purpose whatsoever. We believe that as of December 31, 2009, Marketing had removed, or has scheduled removal of, underground gasoline storage tanks and related equipment at approximately one hundred fifty, or 18%, of our properties and we also believe that most of these properties are either vacant or provide negative or marginal contribution to Marketing’s results. Marketing recently agreed to permit us to list with brokers and to show to prospective purchasers and lessees seventy-five of the properties where Marketing has removed, or has scheduled to remove, underground gasoline storage tanks and related equipment, and we are marketing such properties for sale or leasing. As previously discussed, however, there is no agreement between us and Marketing on terms for removal of properties from the Marketing Leases. In those instances where we determine that the best use for a property is no longer as a retail motor fuel outlet, we will seek an alternative tenant or buyer for such property. With respect to properties that are vacant or have had underground gasoline storage tanks and related equipment removed, it may be more difficult or costly to re-let or sell such properties as gas stations because of capital costs or possible zoning or permitting rights that are required and that may have lapsed during the period since gasoline was last sold at the property. Conversely, it may be easier to re-let or sell properties where underground gasoline storage tanks and related equipment have been removed if the property will not be used as a retail motor fuel outlet or if environmental contamination has been remediated.

In accordance with accounting principles generally accepted in the United States of America (“GAAP”), the aggregate minimum rent due over the current terms of the Marketing Leases, substantially all of which are scheduled to expire in December 2015, is recognized on a straight-line (or an average) basis rather than when payment contractually is due. We record the cumulative difference between lease revenue recognized under this straight line accounting method and the lease revenue recognized when payment is due under the contractual payment terms as deferred rent receivable on our consolidated balance sheets. We provide reserves for a portion of the recorded deferred rent receivable if circumstances indicate that a property may be disposed of before the end of the current lease term or if it is not reasonable to assume that a tenant will make all of its contractual lease payments during the current lease term. Our assessments and assumptions regarding the recoverability of the deferred rent receivable related to the properties subject to the Marketing Leases are reviewed on a quarterly basis and such assessments and assumptions are subject to change.

Based on our prior decision to attempt to negotiate with Marketing for a modification of the Marketing Leases to remove approximately 40% of the properties from the Marketing Leases, we previously concluded in March 2008 that we could not reasonably assume that we will collect all of the rent due to us related to those properties for the remainder of the current term of each lease comprising the Marketing Leases. Accordingly, we recorded a $10.5 million non-cash deferred rent receivable reserve as of December 31, 2007 based on the deferred rent receivable recorded related to those properties because we then believed those properties were most likely to be removed from the Marketing Leases as a result of a modification of the Marketing Leases. Providing this $10.5 million non-cash deferred rent receivable reserve reduced our net earnings and our funds from operations for 2007 but did not impact our cash flow from operating activities or adjusted funds from operations since the impact of the straight-line method of accounting is not included in our determination of adjusted funds from operations. (For additional information regarding funds from operations and adjusted funds from operations, which are non-GAAP measures, see “— General — Supplemental Non-GAAP Measures” below.) The deferred rent receivable and the related $10.5 million deferred rent receivable reserve have declined since December 31, 2007 as a result of regular monthly lease payments being made by Marketing and the removal of individual properties from the Marketing Leases.

We continue to believe that it is likely that the Marketing Leases will be modified and therefore we cannot reasonably assume that we will collect all of the rent due to us for the entire portfolio of properties we lease to Marketing for the remainder of the current term of each lease comprising the Marketing Leases. However, as a result of Marketing’s restructuring announced in the fourth quarter of 2009 and the potential effect on our properties caused by changes in Marketing’s business model, we reevaluated the entire portfolio of properties we lease to Marketing, and reconstituted the list of properties that we used to estimate the deferred rent receivable reserve as of December 31, 2009. We reviewed the properties that had previously been designated to us by Marketing for removal and which were the subject of our prior decision to attempt to negotiate with Marketing for a modification of the Marketing Leases and from that group of properties, we excluded properties that we no longer considered to be the most likely to be removed from the Marketing Leases, such as those which are subject to significant subleases between Marketing and various distributors (as described above) and third

party leased properties. Then, to the group of properties remaining, we added properties most likely to be removed from the Marketing Leases, properties previously designated by Marketing for removal from time to time and properties that we believe are currently negative or marginal contributors to Marketing’s results, such as those that are vacant or have had tanks removed. Based on our reevaluation of the entire portfolio of properties we lease to Marketing, we identified three hundred fifty properties as being the most likely to be removed from the Marketing Leases. Our estimate of the deferred rent receivable reserve as of December 31, 2009 of $9.4 million is based on the deferred rent receivable attributable to these three hundred fifty properties. We have not provided a deferred rent receivable reserve related to the remaining properties subject to the Marketing Leases since, based on our assessments and assumptions, we continue to believe that it is probable that we will collect the deferred rent receivable related to those remaining properties and that Lukoil will not allow Marketing to fail to perform its rental, environmental and other obligations under the Marketing Leases.

We perform an impairment analysis of the carrying amount of the properties subject to the Marketing Leases from time to time in accordance with GAAP when indicators of impairment exist. During the year ended December 31, 2008, we adjusted the estimated useful lives of certain long-lived assets for properties subject to the Marketing Leases resulting in accelerating the depreciation expense recorded for those assets. The impact to depreciation expense due to adjusting the estimated lives for certain long-lived assets beginning with the year ended December 31, 2008 was not material. During the year ended December 31, 2009, we reduced the carrying amount to fair value (generally estimated as sales value net of disposal costs), and recorded impairment charges aggregating $1.1 million, for certain properties leased to Marketing where the carrying amount of the property exceeded the estimated undiscounted cash flows expected to be received during the assumed holding period and the estimated net sales value expected to be received at disposition. The impairment charges were attributable to general reductions in real estate valuations and, in certain cases, by the removal or scheduled removal of underground storage tanks by Marketing.

Marketing is directly responsible to pay for (i) remediation of environmental contamination it causes and compliance with various environmental laws and regulations as the operator of our properties, and (ii) known and unknown environmental liabilities allocated to Marketing under the terms of the Marketing Leases and various other agreements with us relating to Marketing’s business and the properties it leases from us (collectively the “Marketing Environmental Liabilities”). However, we continue to have ongoing environmental remediation obligations at one hundred eighty-seven retail sites and for certain pre-existing conditions at six of the terminals we lease to Marketing. If Marketing fails to pay the Marketing Environmental Liabilities, we may ultimately be responsible to pay directly for Marketing Environmental Liabilities as the property owner. We do not maintain pollution legal liability insurance to protect the Company from potential future claims for Marketing Environmental Liabilities. We will be required to accrue for Marketing Environmental Liabilities if we determine that it is probable that Marketing will not meet its obligations and we can reasonably estimate the amount of the Marketing Environmental Liabilities for which we will be directly responsible to pay, or if our assumptions regarding the ultimate allocation methods or share of responsibility that we used to allocate environmental liabilities changes. However, we continue to believe that it is not probable that Marketing will not pay for substantially all of the Marketing Environmental Liabilities since we believe that Lukoil will not allow Marketing to fail to perform its rental, environmental and other obligations under the Marketing Leases. Accordingly, we did not accrue for the Marketing Environmental Liabilities as of December 31, 2009 or December 31, 2008. Nonetheless, we have determined that the aggregate amount of the Marketing Environmental Liabilities (as estimated by us) could be material to us if we were required to accrue for all of the Marketing Environmental Liabilities in the future since we believe that as a result of any such accrual, it is reasonably possible that we may not be in compliance with the existing financial covenants in our Credit Agreement and our Term Loan Agreement. Such non-compliance could result in an event of default under the Credit Agreement and the Term Loan Agreement which, if not cured or waived, could result in the acceleration of our indebtedness under the Credit Agreement and the Term Loan Agreement.

We estimate that as of December 31, 2009, the aggregate Marketing Environmental Liabilities for which we may ultimately be responsible to pay range between $13 million and $20 million, net of expected recoveries from underground storage tank funds of which between $6 million to $9 million relate to the three hundred fifty properties that we identified as the basis for our estimate of the deferred rent receivable reserve. Although we do not have a common understanding with Marketing that would form a basis for modification of the Marketing Leases, if the Marketing Leases are modified to remove any composition of properties, it is not our intention to assume Marketing’s Environmental Liabilities related to the properties that are so removed without adequate consideration from Marketing. Since we generally do not have access to certain site specific information available to Marketing, which is the party responsible for paying and managing its environmental remediation expenses at our properties, our estimates were developed in large part by review of the limited publically available information gathered through electronic databases and freedom of information requests and assumptions we made based on that data and on our own experiences with environmental remediation matters. The actual aggregate

Marketing Environmental Liabilities and the actual Marketing Environmental Liabilities related to the three hundred fifty properties that we identified as the basis for our estimate of the deferred rent receivable reserve may differ materially from our estimates and we can provide no assurance as to the accuracy of these estimates.

Our belief that to the extent Marketing requires continued financial support from Lukoil, it is probable that Lukoil will continue to provide such support, and that Lukoil will not allow Marketing to fail to perform its obligations under the Marketing Leases are critical assumptions regarding future uncertainties affecting the accounting for matters related to Marketing and the Marketing Leases. Our beliefs are based on various factors, including, among other things, Marketing’s timely payment history despite its trend of reporting large losses, capital contributions made and credit support provided in the past by Lukoil, and the potential damage to Lukoil’s brand and reputation which we do not believe Lukoil would be willing to suffer as a result of default or bankruptcy of one of its wholly owned subsidiaries. Prior to Marketing’s restructuring discussed above, we also based our beliefs on Lukoil’s guarantees of substantially all of Marketing’s outstanding debt which was repaid in the fourth quarter of 2009. We cannot predict whether the restructuring announced by Marketing will stem Marketing’s recent history of significant annual operating losses, and whether Marketing will continue to be dependent on financial support from Lukoil to meet its obligations as they become due through the terms of the Marketing Leases. We cannot predict what actions Marketing or Lukoil will take if, subsequent to the restructuring, Marketing continues to be dependent on financial support from Lukoil to meet its obligations as they become due through the terms of the Marketing Leases.

Should our assessments, assumptions and beliefs prove to be incorrect, including, in particular, our belief that Lukoil will continue to provide financial support to Marketing, or if circumstances change, the conclusions we reached may change relating to (i) whether any or what combination of the properties subject to the Marketing Leases are likely to be removed from the Marketing Leases; (ii) recoverability of the deferred rent receivable for some or all of the properties subject to the Marketing Leases; (iii) potential impairment of the properties subject to the Marketing Leases; and (iv) Marketing’s ability to pay the Marketing Environmental Liabilities. We intend to regularly review our assumptions that affect the accounting for deferred rent receivable; long-lived assets; environmental litigation accruals; environmental remediation liabilities; and related recoveries from state underground storage tank funds. Accordingly, we may be required to reserve additional amounts of the deferred rent receivable, record additional impairment charges related to the properties subject to the Marketing Leases, or accrue for Marketing Environmental Liabilities as a result of the potential or actual modification of the Marketing Leases or other factors, which may result in material adjustments to the amounts recorded for these assets and liabilities, and as a result of which, we may not be in compliance with the financial covenants in our Credit Agreement and our Term Loan Agreement.

We cannot provide any assurance that Marketing will continue to meet its rental, environmental or other obligations under the Marketing Leases. In the event that Marketing does not perform its rental, environmental or other obligations under the Marketing Leases; if the Marketing Leases are modified significantly or terminated; if we determine that it is probable that Marketing will not meet its rental, environmental or other obligations and we accrue for certain of such liabilities; if we are unable to promptly re-let or sell the properties upon recapture from the Marketing Leases; or, if we change our assumptions that affect the accounting for rental revenue or Marketing Environmental Liabilities related to the Marketing Leases and various other agreements; our business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price may be materially adversely affected.

Supplemental Non-GAAP Measures

We manage our business to enhance the value of our real estate portfolio and, as a REIT, place particular emphasis on minimizing risk and generating cash sufficient to make required distributions to shareholders of at least ninety percent of our taxable income each year. In addition to measurements defined by accounting principles generally accepted in the United States of America (“GAAP”), our management also focuses on funds from operations available to common shareholders (“FFO”) and adjusted funds from operations available to common shareholders (“AFFO”) to measure our performance. FFO is generally considered to be an appropriate supplemental non-GAAP measure of the performance of REITs. FFO is defined by the National Association of Real Estate Investment Trusts as net earnings before depreciation and amortization of real estate assets, gains or losses on dispositions of real estate, (including such non-FFO items reported in discontinued operations), extraordinary items and cumulative effect of accounting change. Other REITs may use definitions of FFO and/or AFFO that are different than ours and; accordingly, may not be comparable.

We believe that FFO and AFFO are helpful to investors in measuring our performance because both FFO and AFFO exclude various items included in GAAP net earnings that do not relate to, or are not indicative of, our fundamental operating performance. FFO excludes various items such as gains or losses from property dispositions and depreciation and amortization of real estate assets. In our case, however, GAAP net earnings and FFO typically include the impact of deferred rental revenue (straight-line rental revenue), the net amortization of above-market and below-market leases and income recognized from direct financing leases on our recognition of revenues from rental properties (collectively, the “Revenue Recognition Adjustments”), as offset by the impact of related collection reserves. GAAP net earnings and FFO from time to time may also include impairment charges and/or income tax benefits. Deferred rental revenue results primarily from fixed rental increases scheduled under certain operating leases with our tenants. In accordance with GAAP, the aggregate minimum rent due over the current term of these leases are recognized on a straight-line (or an average) basis rather than when payment is contractually due. The present value of the difference between the fair market rent and the contractual rent for in-place leases at the time properties are acquired is amortized into revenue from rental properties over the remaining lives of the in-place leases. Income from direct financing leases is recognized over the lease term using the effective interest method which produces a constant periodic rate of return on the net investment in the leased property. Impairment of long-lived assets represents charges taken to write-down real estate assets to fair value estimated when events or changes in circumstances indicate that the carrying amount of the property may not be recoverable. In prior periods, income tax benefits have been recognized due to the elimination of, or a net reduction in, amounts accrued for uncertain tax positions related to being taxed as a C-corp., rather than as a REIT, prior to 2001.

Management pays particular attention to AFFO, a supplemental non-GAAP performance measure that we define as FFO less Revenue Recognition Adjustments, impairment charges and income tax benefit. In management’s view, AFFO provides a more accurate depiction than FFO of our fundamental operating performance related to: (i) the impact of scheduled rent increases under certain operating leases; (ii) rental revenue from acquired in-place leases; (iii) the impact of rent due from direct financing leases, (iv) our rental operating expenses (exclusive of impairment charges); and (v) our election to be treated as a REIT under the federal income tax laws beginning in 2001. Neither FFO nor AFFO represent cash generated from operating activities calculated in accordance with GAAP and therefore these measures should not be considered an alternative for GAAP net earnings or as a measure of liquidity. For a reconciliation of FFO and AFFO, see “Item 6. Selected Financial Data”.

Net earnings, earning from continuing operations and FFO for 2007 were reduced by all or substantially all of the $10.5 million non-cash deferred rent receivable reserve recorded as of December 31, 2007 for approximately 40% of the properties leased to Marketing under the Marketing Leases. (See “— General — Marketing and the Marketing Leases” above for additional information.) If the applicable amount of the non-cash deferred rent receivable reserve were added to our 2007 net earnings, earning from continuing operations and FFO; net earnings would have been $44.4 million, or $1.79 per share, for the year ended December 31, 2007; earnings from continuing operations would have been $38.0 million for the year ended December 31, 2007; and FFO would have been $48.0 million, or $1.94 per share, for the year ended December 31, 2007. Accordingly, as compared to the respective prior year periods; net earnings for 2008 would have decreased by $2.6 million and for 2007 would have increased by $1.7 million; earnings from continuing operations for 2008 would have increased by $0.8 million and for 2007 would have decreased by $3.6 million; and FFO for 2008 would have increased by $2.9 million and for 2007 would have decreased by $1.0 million. We believe that these supplemental non-GAAP measures for 2007 are important to assist in the analysis of our performance for 2008 as compared to 2007 and 2007 as compared to 2006, exclusive

of the impact of the non-cash deferred rent receivable reserve on our results of operations and are reconciled below (in thousands):


	Non- adjusted		Reserve		As Adjusted

Net earnings	$	33,894	$	10,494	$	44,388
Earnings from continuing operations		27,842		10,206		38,048
Funds from operations		37,509		10,494		48,003

2009 and 2008 Acquisitions

On September 25, 2009 we acquired the real estate assets and improvements of thirty-six gasoline stations and convenience store properties located primarily in Prince George’s County Maryland, for $49.0 million from White Oak Petroleum LLC (“White Oak”) for cash with $24.5 million draw under our existing Credit Agreement and $24.5 provided by the three-year Term Loan Agreement entered into on that date.

The real estate assets were acquired in a simultaneous transaction among ExxonMobil, White Oak and us, whereby White Oak acquired the real estate assets and the related businesses from ExxonMobil and simultaneously completed a sale/leaseback of the real estate assets of all thirty-six properties with us. We entered into a unitary triple-net lease for the real estate assets with White Oak which has an initial term of twenty years and provides White Oak with options for three renewal terms of ten years each extending to 2059. The unitary triple-net lease provides for annual rent escalations of 2½% per year. White Oak is responsible to pay for all existing and future environmental liabilities related to the properties.

In 2009 we also exercised our fixed price purchase option for one leased property and purchased three properties. In 2008 we exercised our fixed price purchase options for three leased properties and purchased six properties.

RESULTS OF OPERATIONS

Year ended December 31, 2009 compared to year ended December 31, 2008

Revenues from rental properties included in continuing operations increased by $1.7 million to $84.5 million for the year ended December 31, 2009, as compared to $82.8 million for 2008. We received approximately $60.0 million for 2009 and 2008, from properties leased to Marketing under the Marketing Leases. We also received rent of $22.5 million for 2009 and $20.3 million for 2008 from other tenants. The increase in rent received was primarily due to rent escalations, and rental income from properties acquired, partially offset by the effect of lease expirations. In accordance with GAAP, we recognize rental revenue in amounts which vary from the amount of rent contractually due or received during the periods presented. As a result, revenues from rental properties include non-cash adjustments recorded for deferred rental revenue due to the recognition of rental income on a straight-line (or an average) basis over the current lease term, net amortization of above-market and below-market leases and recognition of rental income recorded under a direct financing lease using the effective interest method which produces a constant periodic rate of return on the net investment in the leased property (the “Revenue Recognition Adjustments”). Rental revenue included in continuing operations includes Revenue Recognition Adjustments of $2.0 million for the year ended December 31, 2009, which decreased by $0.5 million for the year as compared to $2.5 million in 2008.

Rental property expenses, which are primarily comprised of rent expense and real estate and other state and local taxes, included in continuing operations were $10.9 million for 2009, as compared to $11.5 million for 2008. The decrease in rental property expenses is due to a reduction in rent expense incurred as a result of third party lease expirations as compared to the prior year.

Environmental expenses, net of estimated recoveries from state underground storage tank (“UST” or “USTs”) funds included in continuing operations for 2009 were $8.8 million, as compared to $7.4 million for 2008. The increase was due to a $2.4 million net increase in environmental related litigation reserves, which was partially offset by a reduction in legal fees of $0.2 million and a reduction in estimated environmental remediation costs of $0.7 million, respectively. The increase in environmental litigation reserves was principally attributed to settlement of twenty-seven MTBE cases in which we were named a defendant. See Environmental Matters – Environmental Litigation below for additional information related to our

defense of MTBE cases. Environmental expenses vary from period to period and, accordingly, undue reliance should not be placed on the magnitude or the direction of change in reported environmental expenses for one period as compared to prior periods.

General and administrative expenses for 2009 were $6.8 million, which was comparable to 2008.

Depreciation and amortization expense included in continuing operations for 2009 was $11.0 million, as compared to $11.7 million for 2008. The decrease was primarily due to the effect of assets becoming fully depreciated, dispositions of real estate and lease expirations.

The $1.1 million of impairment charges recorded in the year ended December 31, 2009 was attributable to general reductions in real estate valuations and, in certain cases, the removal or scheduled removal of underground storage tanks by Marketing.

As a result, total operating expenses increased by approximately $1.2 million for 2009 as compared to 2008.

Other income, net, included in income from continuing operations increased by $0.2 million to $0.6 million for 2009, as compared to $0.4 million for 2008. Gains on dispositions of real estate included in discontinued operations were $5.3 million for 2009 as compared to $2.4 million for 2008. Gains on dispositions of real estate in 2009 increased by an aggregate of $2.7 million to $5.5 million, as compared to $2.8 million for the prior year. For 2009, there were eight property dispositions and two partial land takings under eminent domain. For 2008, there were eleven property dispositions, four partial land takings under eminent domain. Property dispositions for 2009 and 2008 include four and seven properties, respectively, that were mutually agreed to be removed from the Marketing Leases prior to their scheduled lease expiration. Other income, net and gains on disposition of real estate vary from period to period and, accordingly, undue reliance should not be placed on the magnitude or the direction of change in reported gains for one period as compared to prior periods.

Interest expense was $5.1 million for 2009, as compared to $7.0 million for 2008. The decrease was due to lower average interest rates in 2009 on our floating rate borrowings, partially offset by increased average borrowings outstanding relating to the acquisition of properties in the third quarter of 2009.

As a result, net earnings were $47.0 million for 2009, as compared to $41.8 million for 2008, an increase of 12.4%, or $5.2 million. Earnings from continuing operations were $41.4 million for 2009, as compared to $38.8 million for 2008, an increase of 6.7%, or $2.6 million. For the same period, FFO increased by 3.3% to $52.6 million, as compared to $50.9 million for prior year period and AFFO increased by 7.0%, or $3.4 million, to $51.7 million, as compared to $48.3 million for 2008. The increase in FFO for 2009 was primarily due to the changes in net earnings described above but excludes a $0.9 million decrease in depreciation and amortization expense and a $2.7 million increase in gains on dispositions of real estate. The increase in AFFO for 2009 also excludes a $0.5 million reduction in Rental Revenue Adjustments which cause our reported revenues from rental properties to vary from the amount of rent payments contractually due or received by us during the periods presented, and a $1.1 million impairment charge recorded in 2009 (which are included in net earnings and FFO but are excluded from AFFO).

Diluted earnings per share were $1.90 per share for 2009, an increase of $0.21 per share, as compared to $1.69 per share for 2008. Diluted FFO per share for 2009 was $2.12 per share, an increase of $0.06 per share, as compared to 2008. Diluted AFFO per share for 2009 was $2.09 per share, an increase of $0.14 per share, as compared to 2008.

Year ended December 31, 2008 compared to year ended December 31, 2007

Revenues from rental properties included in continuing operations increased by $3.6 million to $82.8 million for the year ended December 31, 2008, as compared to $79.2 million for 2007. We received approximately $60.0 million for 2008, and $59.3 million for 2007, from properties leased to Marketing under the Marketing Leases. We also received rent of $20.3 million for 2008 and $16.3 million for 2007 from other tenants. The increase in rent received was primarily due to rent escalations, and rental income from properties acquired, partially offset by the effect of lease expirations. In accordance with GAAP, we recognize rental revenue in amounts which vary from the amount of rent contractually due or received during the periods presented As a result revenues from rental properties for 2008 and 2007 include non-cash Revenue Recognition Adjustments recorded due to the recognition of rental income on a straight-line (or an average) basis over the current lease term and net amortization of above-market and below-market leases. Rental revenue included in continuing operations

includes Revenue Recognition Adjustments of $2.5 million for the year ended December 31, 2008, which decreased by $1.1 million for the year as compared to $3.6 million in 2007.

Rental property expenses, which are primarily comprised of rent expense and real estate and other state and local taxes, included in continuing operations were $11.5 million for 2008, as compared to $10.9 million for 2007. Increases in real estate and other state and local taxes were partially offset by the decrease in rent expense which was principally due to the reduction in the number of leased locations compared to the prior year.

Environmental expenses, net of estimated recoveries from state UST funds included in continuing operations for 2008 were $7.4 million, as compared to $8.2 million for 2007. The decrease was primarily due to a $0.5 million decrease in change in estimated environmental remediation costs, and a $0.4 million net decrease in environmental related litigation reserves and legal fees as compared to the prior year period. Environmental expenses vary from period to period and, accordingly, undue reliance should not be placed on the magnitude or the direction of change in reported environmental expenses for one period as compared to prior periods.

General and administrative expenses for 2008 were $6.8 million, as compared to $6.7 million recorded for 2007. The increase in general and administrative expenses was due to $0.5 million of higher professional fees associated with previously disclosed potential modification of the Marketing Leases which was partially offset by a $0.2 million reduction in insurance loss reserves and a $0.3 million reduction in employee related expenses. The insurance loss reserves were established under our self funded insurance program that was terminated in 1997. Employee related expenses recorded in 2007 include the payment of severance in connection with the resignation of Mr. Andy Smith, the former President and Chief Legal Officer of the Company.

Allowance for deferred rent receivable reported in continuing operations and discontinued operations were $10.2 million and $0.3 million, respectively, for the year ended December 31, 2007. The non-cash allowance was provided in 2007 since we could no longer reasonably assume that we will collect all of the rent due to us related to approximately 40% of the properties leased to Marketing for the remainder of the current terms of the Marketing Leases. (See “— General — Marketing and the Marketing Leases” above for additional information.)

Depreciation and amortization expense included in continuing operations for 2008 was $11.7 million, as compared to $9.6 million for 2007. The increase was primarily due to properties acquired in 2007 and the acceleration of depreciation expense resulting from the reduction in the estimated useful lives of certain assets which may be removed from the unitary lease with Marketing, which increases were partially offset by the effect of dispositions of real estate and lease expirations.

As a result, total operating expenses decreased by approximately $8.1 million for 2008 as compared to 2007.

Other income, net, substantially all of which is comprised of certain gains from dispositions of real estate and leasehold interests, decreased by $1.5 million to $0.4 million for 2008, as compared to $1.9 million for 2007. Gains on dispositions of real estate from discontinued operations were $2.4 million for 2008 as compared to $4.6 million for 2007. Gain on dispositions of real estate in 2008 decreased by an aggregate of $3.4 million to $2.8 million, as compared to $6.2 million for the prior year. For 2008, there were eleven property dispositions and four partial land takings under eminent domain. For 2007, there were thirteen property dispositions, a partial land taking under eminent domain and an increase in the awards for two takings that occurred in prior years. Property dispositions for 2008 and 2007 include seven and six properties, respectively, that were mutually agreed to be removed from the Marketing Leases prior to their scheduled lease expiration. Gains on disposition of real estate vary from period to period and, accordingly, undue reliance should not be placed on the magnitude or the direction of change in reported gains for one period as compared to prior periods.

Interest expense was $7.0 million for 2008, as compared to $7.8 million for 2007. The decrease was due to reduction in interest rates, partially offset by increased average borrowings outstanding used to finance the acquisition of properties in 2007.

As a result, net earnings were $41.8 million for 2008, as compared to $33.9 million for 2007, an increase of 23.4%, or $7.9 million. Earnings from continuing operations were $38.8 million for 2008, as compared to $27.8 million for 2007, an increase of 39.6%, or $11.0 million. For the same period, FFO increased by 35.7% to $50.9 million, as compared to $37.5 million for prior year period and AFFO increased by 10.2%, or $4.5 million, to $48.3 million, as compared to $43.8 million for 2007. The increase in FFO for 2008 was primarily due to the changes in net earnings described above but excludes a $2.1

million increase in depreciation and amortization expense and a $3.4 million decrease in gains on dispositions of real estate. The increase in AFFO for 2008 also excludes a $1.6 million reduction in Revenue Recognition Adjustments which cause our reported revenues from rental properties to vary from the amount of rent payments contractually due or received by us during the periods presented and a $10.5 million deferred rent receivable reserve recorded in 2007 (which are included in net earnings and FFO but are excluded from AFFO).

Diluted earnings per share were $1.69 per share for 2008, an increase of $0.32 per share, as compared to $1.37 per share for 2007. Diluted FFO per share for 2008 was $2.06 per share, an increase of $0.55 per share, as compared to 2007. Diluted AFFO per share for 2008 was $1.95 per share, an increase of $0.18 per share, as compared to 2007.

LIQUIDITY AND CAPITAL RESOURCES

Our principal sources of liquidity are the cash flows from our operations, funds available under a revolving credit agreement that expires in March 2011 and available cash and cash equivalents. Management believes that our operating cash needs for the next twelve months can be met by cash flows from operations, borrowings under our credit agreement and available cash and cash equivalents. There can be no assurance, however, that our business operations or liquidity will not be adversely affected by Marketing and the Marketing Leases discussed in “General - Marketing and the Marketing Leases” above or the other risk factors described in our filings with the SEC.

Disruptions in the credit markets, and the resulting impact on the availability of funding generally, may limit our access to one or more funding sources. In addition, we expect that the costs associated with any additional borrowings we may undertake may be adversely impacted, as compared to such costs prior to the disruption of the credit markets. As a result of the current credit markets, we may not be able to obtain additional financing on favorable terms, or at all. If one or more of the financial institutions that supports our credit agreement fails, we may not be able to find a replacement, which would negatively impact our ability to borrow under our credit agreement. In addition, if the pressures on credit continue or worsen, we may not be able to refinance our outstanding debt when due, which could have a material adverse effect on us.

As of December 31, 2009, borrowings under the Credit Agreement, described below, were $151.2 million, bearing interest at a weighted-average effective rate of 3.0% per annum. The weighted-average effective rate is based on $106.2 million of LIBOR rate borrowings floating at market rates plus a margin of 1.25% and $45.0 million of LIBOR rate borrowings effectively fixed at 5.44% by an interest rate Swap Agreement, described below, plus a margin of 1.25%. We are party to a $175.0 million amended and restated senior unsecured revolving credit agreement (the “Credit Agreement”) with a group of domestic commercial banks led by JPMorgan Chase Bank, N.A. (the “Bank Syndicate”) which expires in March 2011. We had $23.8 million available under the terms of the Credit Agreement as of December 31, 2009. The Credit Agreement does not provide for scheduled reductions in the principal balance prior to its maturity. The Credit Agreement permits borrowings at an interest rate equal to the sum of a base rate plus a margin of 0.0% or 0.25% or a LIBOR rate plus a margin of 1.0%, 1.25% or 1.5%. The applicable margin is based on our leverage ratio at the end of the prior calendar quarter, as defined in the Credit Agreement, and is adjusted effective mid-quarter when our quarterly financial results are reported to the Bank Syndicate. Based on our leverage ratio as of December 31, 2009, the applicable margin will remain at 0.0% for base rate borrowings and 1.25% for LIBOR rate borrowings.

Subject to the terms of the Credit Agreement and continued compliance with the covenants therein, we have the option to extend the term of the Credit Agreement for one additional year to March 2012 and/or, subject to approval by the Bank Syndicate, increase the amount of the credit facility available pursuant to the Credit Agreement by $125.0 million to $300.0 million. We do not expect to exercise our option to increase the amount of the Credit Agreement at this time. In addition, based on the current lack of liquidity in the credit markets, we believe that we would need to renegotiate certain terms in the Credit Agreement in order to obtain approval from the Bank Syndicate to increase the amount of the credit facility at this time. No assurance can be given that such approval from the Bank Syndicate will be obtained on terms acceptable to us, if at all. The annual commitment fee on the unused Credit Agreement ranges from 0.10% to 0.20% based on the average amount of borrowings outstanding. The Credit Agreement contains customary terms and conditions, including financial covenants such as those requiring us to maintain minimum tangible net worth, leverage ratios and coverage ratios which may limit our ability to incur debt or pay dividends The Credit Agreement contains customary events of default, including change of control, failure to maintain REIT status and a material adverse effect on our business, assets, prospects or condition. Any event of default, if not cured or waived, could result in the acceleration of our indebtedness under our Credit Agreement and

could also give rise to an event of default and consequent acceleration of our indebtedness under our Term Loan Agreement described below.

We are party to a $45.0 million LIBOR based interest rate Swap Agreement with JPMorgan Chase Bank, N.A. as the counterparty (the “Swap Agreement”), effective through June 30, 2011. The Swap Agreement is intended to hedge our current exposure to market interest rate risk by effectively fixing, at 5.44%, the LIBOR component of the interest rate determined under our existing Credit Agreement or future exposure to variable interest rate risk due to borrowing arrangements that may be entered into prior to the expiration of the Swap Agreement. As a result of the Swap Agreement, as of December 31, 2009, $45.0 million of our LIBOR based borrowings under the Credit Agreement bear interest at an effective rate of 6.69%.

In order to partially finance the acquisition of thirty-six properties in September 2009, we entered into a $25.0 million three-year Term Loan Agreement with TD Bank (the “Term Loan Agreement”) which expires in September 2012. The Term Loan Agreement bears interest at a rate equal to a thirty day LIBOR rate (subject to a floor of 0.4%) plus a margin of 3.1%. As of December 31, 2009, borrowings under the Term Loan Agreement were $24.4 million bearing interest at a rate of 3.5% per annum. The Term Loan Agreement provides for annual reductions of $0.8 million in the principal balance with a $22.2 million balloon payment due at maturity. The Term Loan Agreement contains customary terms and conditions, including financial covenants such as those requiring us to maintain minimum tangible net worth, leverage ratios and coverage ratios which may limit our ability to incur debt or pay dividends. The Term Loan Agreement contains customary events of default, including change of control, failure to maintain REIT status and a material adverse effect on our business, assets, prospects or condition. Any event of default, if not cured or waived, could result in the acceleration of our indebtedness under the Term Loan Agreement and could also give rise to an event of default and consequent acceleration of our indebtedness under our Credit Agreement.

Since we generally lease our properties on a triple-net basis, we do not incur significant capital expenditures other than those related to acquisitions. As part of our overall business strategy, we regularly review opportunities to acquire additional properties and we expect to continue to pursue acquisitions that we believe will benefit our financial performance. Capital expenditures, including acquisitions, for 2009, 2008 and 2007 amounted to $55.3 million, $6.6 million and $90.6 million, respectively. To the extent that our current sources of liquidity are not sufficient to fund capital expenditures and acquisitions we will require other sources of capital, which may or may not be available on favorable terms or at all. We cannot accurately predict how periods of illiquidity in the credit markets, such as current market conditions, will impact our access to capital.

We elected to be treated as a REIT under the federal income tax laws with the year beginning January 1, 2001. As a REIT, we are required, among other things, to distribute at least ninety percent of our taxable income to shareholders each year. Payment of dividends is subject to market conditions, our financial condition and other factors, and therefore cannot be assured. In particular, our Credit Agreement and our Term Loan Agreement prohibit the payment of dividends during certain events of default. Dividends paid to our shareholders aggregated $46.8 million, $46.3 million and $45.7 million for 2009, 2008 and 2007, respectively, and were paid on a quarterly basis during each of those years. We presently intend to pay common stock dividends of $0.475 per share each quarter ($1.90 per share, or $47.2 million, on an annual basis including dividend equivalents paid on outstanding restricted stock units), and commenced doing so with the quarterly dividend declared in August 2009. Due to contingencies related to Marketing and the Marketing Leases discussed in “General - Marketing and the Marketing Leases” above, there can be no assurance that we will be able to continue to pay dividends at the rate of $0.475 per share per quarter, if at all.

CONTRACTUAL OBLIGATIONS

Our significant contractual obligations and commitments are comprised of borrowings under the Credit Agreement and the Term Loan Agreement, operating lease payments due to landlords and estimated environmental remediation expenditures, net of estimated recoveries from state UST funds. In addition, as a REIT we are required to pay dividends equal to at least ninety percent of our taxable income in order to continue to qualify as a REIT. Our contractual obligations and commitments as of December 31, 2009 are summarized below (in thousands):


	TOTAL			LESS THAN- ONE YEAR			ONE-TO THREE YEARS			THREE TO FIVE YEARS			MORE THAN FIVE YEARS

Operating leases	$	23,782		$	6,673		$	9,473		$	4,678		$	2,958
Borrowing under the Credit Agreement (a)(b)		151,200			—			151,200			—			—
Borrowings under the Term Loan Agreement (a)		24,370			780			23,590			—			—
Estimated environmental remediation expenditures (c)		16,527			5,951			5,951			2,388			2,237
Estimated recoveries from state underground storage tank funds (c)		(3,882	)		(1,298	)		(1,491	)		(690	)		(403	)

Estimated net environmental remediation expenditures (c)		12,645			4,653			4,460			1,698			1,834

Total	$	211,997		$	12,106		$	188,723		$	6,376		$	4,792


(a)	Excludes related interest payments. (See “— Liquidity and Capital Resources” above and “Item 7A. Quantitative and Qualitative Disclosures About Market Risk” for additional information.)

(b)	Subject to the terms of the Credit Agreement and continued compliance with the covenants therein, we have the option to extend the term of the Credit Agreement to March 2012.

(c)	Estimated environmental remediation expenditures and estimated recoveries from state UST funds have been adjusted for inflation and discounted to present value.

Generally, the leases with our tenants are “triple-net” leases, with the tenant responsible for managing the operations conducted at these properties and for the payment of taxes, maintenance, repair, insurance, environmental remediation and other operating expenses. We estimate that Marketing makes annual real estate tax payments for properties leased under the Marketing Leases of approximately $13.0 million and makes additional payments for other operating expenses related to our properties, including environmental remediation costs other than those liabilities that were retained by us. These costs are not reflected in our consolidated financial statements. (See “— General — Marketing and the Marketing Leases” above for additional information.)

We have no significant contractual obligations not fully recorded on our consolidated balance sheets or fully disclosed in the notes to our consolidated financial statements. We have no off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated by the Exchange Act.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The consolidated financial statements included in this Annual Report on Form 10-K include the accounts of Getty Realty Corp. and our wholly-owned subsidiaries. The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. The preparation of financial statements in accordance with GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in its financial statements. Although we have made estimates, judgments and assumptions regarding future uncertainties relating to the information included in our financial statements, giving due consideration to the accounting policies selected and materiality, actual results could differ from these estimates, judgments and assumptions and such differences could be material.

Estimates, judgments and assumptions underlying the accompanying consolidated financial statements include, but are not limited to, deferred rent receivable, income under direct financing leases, recoveries from state underground storage tank funds, environmental remediation costs, real estate, depreciation and amortization, impairment of long-lived assets, litigation,

accrued expenses, income taxes, allocation of the purchase price of properties acquired to the assets acquired and liabilities assumed and exposure to paying an earnings and profits deficiency dividend. The information included in our financial statements that is based on estimates, judgments and assumptions is subject to significant change and is adjusted as circumstances change and as the uncertainties become more clearly defined. Our accounting policies are described in Note 1 of Notes to Consolidated Financial Statements in “Item 8. Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements”. We believe the following are our critical accounting policies:

Revenue recognition — We earn revenue primarily from operating leases with Marketing and other tenants. We recognize income under the Master Lease with Marketing, and with other tenants, on the straight-line method, which effectively recognizes contractual lease payments evenly over the current term of the leases. The present value of the difference between the fair market rent and the contractual rent for in-place leases at the time properties are acquired is amortized into revenue from rental properties over the remaining lives of the in-place leases. A critical assumption in applying the straight-line accounting method is that the tenant will make all contractual lease payments during the current lease term and that the net deferred rent receivable of $27.5 million recorded as of December 31, 2009 will be collected when the payment is due, in accordance with the annual rent escalations provided for in the leases. Historically our tenants have generally made rent payments when due. However, we may be required to reverse, or provide reserves for, or adjust our $9.4 million reserve as of December 31, 2009 for, a portion of the recorded deferred rent receivable if it becomes apparent that a property may be disposed of before the end of the current lease term or if circumstances indicate that the tenant may not make all of its contractual lease payments when due during the current term of the lease. The straight-line method requires that rental income related to those properties for which a reserve was specifically provided is effectively recognized in subsequent periods when payment is due under the contractual payment terms. (See Marketing and the Marketing Leases in “— General — Marketing and the Marketing Leases” above for additional information.)

Direct Financing Lease — Income under direct financing leases is included in revenues from rental properties and is recognized over the lease term using the effective interest rate method which produces a constant periodic rate of return on the net investment in the leased property. Net investment in direct financing lease represents the investment in leased assets accounted for as a direct financing lease. The investment is reduced by the receipt of lease payments, net of interest income earned and amortized over the life of the lease.

Impairment of long-lived assets — Real estate assets represent “long-lived” assets for accounting purposes. We review the recorded value of long-lived assets for impairment in value whenever any events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. We may become aware of indicators of potentially impaired assets upon tenant or landlord lease renewals, upon receipt of notices of potential governmental takings and zoning issues, or upon other events that occur in the normal course of business that would cause us to review the operating results of the property. We believe our real estate assets are not carried at amounts in excess of their estimated net realizable fair value amounts.

Income taxes — Our financial results generally do not reflect provisions for current or deferred federal income taxes since we elected to be treated as a REIT under the federal income tax laws effective January 1, 2001. Our intention is to operate in a manner that will allow us to continue to be treated as a REIT and, as a result, we do not expect to pay substantial corporate-level federal income taxes. Many of the REIT requirements, however, are highly technical and complex. If we were to fail to meet the requirements, we may be subject to federal income tax, excise taxes, penalties and interest or we may have to pay a deficiency dividend to eliminate any earnings and profits that were not distributed. Certain states do not follow the federal REIT rules and we have included provisions for these taxes in rental property expenses.

Environmental costs and recoveries from state UST funds — We provide for the estimated fair value of future environmental remediation costs when it is probable that a liability has been incurred and a reasonable estimate of fair value can be made (see “— Environmental Matters” below for additional information). Environmental liabilities and related recoveries are measured based on their expected future cash flows which have been adjusted for inflation and discounted to present value. Since environmental exposures are difficult to assess and estimate and knowledge about these liabilities is not known upon the occurrence of a single event, but rather is gained over a continuum of events, we believe that it is appropriate that our accrual estimates are adjusted as the remediation treatment progresses, as circumstances change and as environmental contingencies become more clearly defined and reasonably estimable. A critical assumption in accruing for these liabilities is that the state environmental laws and regulations will be administered and enforced in the future in a manner that is consistent with past practices. Recoveries of environmental costs from state UST remediation funds, with respect to past and future spending, are accrued as income, net of allowance for collection risk, based on estimated recovery

rates developed from our experience with the funds when such recoveries are considered probable. A critical assumption in accruing for these recoveries is that the state UST fund programs will be administered and funded in the future in a manner that is consistent with past practices and that future environmental spending will be eligible for reimbursement at historical rates under these programs. We accrue environmental liabilities based on our share of responsibility as defined in our lease contracts with our tenants and under various other agreements with others or if circumstances indicate that the counter-party may not have the financial resources to pay its share of the costs. It is possible that our assumptions regarding the ultimate allocation method and share of responsibility that we used to allocate environmental liabilities may change, which may result in material adjustments to the amounts recorded for environmental litigation accruals, environmental remediation liabilities and related assets. (See “— General — Marketing and the Marketing Leases” above for additional information.) We may ultimately be responsible to directly pay for environmental liabilities as the property owner if Marketing or our other tenants or other counter-parties fail to pay them. In certain environmental matters the effect on future financial results is not subject to reasonable estimation because considerable uncertainty exists both in terms of the probability of loss and the estimate of such loss. The ultimate liabilities resulting from such lawsuits and claims, if any, may be material to our results of operations in the period in which they are recognized.

Litigation — Legal fees related to litigation are expensed as legal services are performed. We provide for litigation reserves, including certain environmental litigation (see “— Environmental Matters” below for additional information), when it is probable that a liability has been incurred and a reasonable estimate of the liability can be made. If the estimate of the liability can only be identified as a range, and no amount within the range is a better estimate than any other amount, the minimum of the range is accrued for the liability.

Recent Accounting Developments and Amendments to the Accounting Standards Codification — In September 2006, the FASB amended the accounting standards related to fair value measurements of assets and liabilities (the “Fair Value Measurements Amendment”). The Fair Value Measurements Amendment generally applies whenever other standards require assets or liabilities to be measured at fair value. The Fair Value Measurements Amendment was effective in fiscal years beginning after November 15, 2007. The FASB subsequently delayed the effective date of the Fair Value Measurements Amendment by one year for nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis to fiscal years beginning after November 15, 2008. The adoption of the Fair Value Measurements Amendment in January 2008 and the adoption of the provisions of the Fair Value Measurements Amendment for nonfinancial assets and liabilities that are recognized or disclosed at fair value on a nonrecurring basis in January 2009 did not have a material impact on our financial position and results of operations.

In December 2007, the FASB amended the accounting standards related to business combinations (the Business Combinations Amendment”), affecting how the acquirer shall recognize and measure in its financial statements at fair value the identifiable assets acquired, liabilities assumed, any noncontrolling interest in the acquiree and goodwill acquired in a business combination. The Business Combinations Amendment requires that acquisition costs, which could be material to our future financial results, will be expensed rather than included as part of the basis of the acquisition. The adoption of this standard by us on January 1, 2009 did not result in a write-off of acquisition related transactions costs associated with transactions not yet consummated.

ENVIRONMENTAL MATTERS

General

We are subject to numerous existing federal, state and local laws and regulations, including matters relating to the protection of the environment such as the remediation of known contamination and the retirement and decommissioning or removal of long-lived assets including buildings containing hazardous materials, USTs and other equipment. Our tenants are directly responsible for compliance with various environmental laws and regulations as the operators of our properties. Environmental expenses are principally attributable to remediation costs which include installing, operating, maintaining and decommissioning remediation systems, monitoring contamination, and governmental agency reporting incurred in connection with contaminated properties. We seek reimbursement from state UST remediation funds related to these environmental expenses where available.

We enter into leases and various other agreements which allocate responsibility for known and unknown environmental liabilities by establishing the percentage and method of allocating responsibility between the parties. In accordance with the leases with certain of our tenants, we have agreed to bring the leased properties with known environmental contamination to

within applicable standards, and to either regulatory or contractual closure (“Closure”). Generally, upon achieving Closure at an individual property, our environmental liability under the lease for that property will be satisfied and future remediation obligations will be the responsibility of our tenant. As of December 31, 2009, we have regulatory approval for remediation action plans in place for two hundred forty-five (95%) of the two hundred fifty-eight properties for which we continue to retain remediation responsibility and the remaining thirteen properties (5%) were in the assessment phase. In addition, we have nominal post-closure compliance obligations at twenty-two properties where we have received “no further action” letters.

It is possible that our assumptions regarding the ultimate allocation methods or share of responsibility that we used to allocate environmental liabilities may change, which may result in adjustments to the amounts recorded for environmental litigation accruals, environmental remediation liabilities and related assets. We will be required to accrue for environmental liabilities that we believe are allocable to others under various other agreements if we determine that it is probable that the counter-party will not meet its environmental obligations. We may ultimately be responsible to directly pay for environmental liabilities as the property owner if the counter-party fails to pay them. The ultimate resolution of these matters could have a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. (See “— General — Marketing and the Marketing Leases” above for additional information.)

We have not accrued for approximately $1.0 million in costs allegedly incurred by the current property owner in connection with removal of USTs and soil remediation at a property that was leased to and operated by Marketing. We believe that Marketing is responsible for such costs under the terms of the Master Lease and tendered the matter for defense and indemnification from Marketing. Marketing denied its liability for the claim and its responsibility to defend against, and indemnify us for, the claim. We filed third party claims against Marketing for indemnification in this matter. The property owner’s claim for reimbursement of costs incurred and our claim for indemnification by Marketing were actively litigated, leading to a trial held before a judge. The trial court issued its decision in August 2009 under which the Company and Marketing were held jointly and severally responsible to the current property owner for the costs incurred by the owner to remove USTs and remediate contamination at the site, but, as between the Company and Marketing, Marketing was accountable for such costs under the indemnification provisions of the Master Lease. The order on the trial court’s decision was entered in February 2010, making such decision final for purposes of initiating the limited period of time following which appeal may be taken. We believe that Marketing will appeal the decision; however, we believe the probability that Marketing will not be ultimately responsible for the claim for clean-up costs incurred by the current property owner is remote. It is reasonably possible that our assumption that Marketing will be ultimately responsible for the claim may change, which may result in our providing an accrual for this matter.

We have also agreed to provide limited environmental indemnification to Marketing, capped at $4.25 million, for certain pre-existing conditions at six of the terminals we own and lease to Marketing. Under the indemnification agreement, Marketing is required to pay (and has paid) the first $1.5 million of costs and expenses incurred in connection with remediating any such pre-existing conditions, Marketing shares equally with us the next $8.5 million of those costs and expenses and Marketing is obligated to pay all additional costs and expenses over $10.0 million. We have accrued $0.3 million as of December 31, 2009 and December 31, 2008 in connection with this indemnification agreement. Under the Master Lease, we continue to have additional ongoing environmental remediation obligations at one hundred eighty-seven scheduled sites.

As the operator of our properties under the Marketing Leases, Marketing is directly responsible to pay for the remediation of environmental contamination it causes and to comply with various environmental laws and regulations. In addition, the Marketing Leases and various other agreements between Marketing and us allocate responsibility for known and unknown environmental liabilities between Marketing and us relating to the properties subject to the Marketing Leases. Based on

various factors, including our assessments and assumptions at this time that Lukoil would not allow Marketing to fail to perform its obligations under the Marketing Leases, we believe that Marketing will continue to pay for substantially all environmental contamination and remediation costs allocated to it under the Marketing Leases. It is possible that our assumptions regarding the ultimate allocation methods or share of responsibility that we used to allocate environmental liabilities may change, which may result in adjustments to the amounts recorded for environmental litigation accruals, environmental remediation liabilities and related assets. If Marketing fails to pay them, we may ultimately be responsible to directly pay for environmental liabilities as the property owner. We are required to accrue for environmental liabilities that we believe are allocable to Marketing under the Marketing Leases and various other agreements if we determine that it is probable that Marketing will not pay its environmental obligations and we can reasonably estimate the amount of the Marketing Environmental Liabilities for which we will be directly responsible to pay.

Based on our assessment of Marketing’s financial condition and our assumption that Lukoil would not allow Marketing to fail to perform its obligations under the Marketing Leases and certain other factors, including but not limited to those described above, we believe at this time that it is not probable that Marketing will not pay the environmental liabilities allocable to it under the Marketing Leases and various other agreements and, therefore, have not accrued for such environmental liabilities. Our assessments and assumptions that affect the recording of environmental liabilities related to the properties subject to the Marketing Leases are reviewed on a quarterly basis and such assessments and assumptions are subject to change.

We have determined that the aggregate amount of the environmental liabilities attributable to Marketing related to our properties (as estimated by us, based on our assumptions and our analysis of information currently available to us described in more detail above) (the “Marketing Environmental Liabilities”) could be material to us if we were required to accrue for all of the Marketing Environmental Liabilities in the future since we believe that it is reasonably possible that as a result of such accrual, we may not be in compliance with the existing financial covenants in our Credit Agreement and our Term Loan Agreement. Such non-compliance could result in an event of default under the Credit Agreement and our Term Loan Agreement which, if not cured or waived, could result in the acceleration of our indebtedness under the Credit Agreement and the Term Loan Agreement. (See “— General — Marketing and the Marketing Leases” above for additional information.)

The estimated future costs for known environmental remediation requirements are accrued when it is probable that a liability has been incurred and a reasonable estimate of fair value can be made. Environmental liabilities and related recoveries are measured based on their expected future cash flows which have been adjusted for inflation and discounted to present value. The environmental remediation liability is estimated based on the level and impact of contamination at each property and other factors described herein. The accrued liability is the aggregate of the best estimate for the fair value of cost for each component of the liability. Recoveries of environmental costs from state UST remediation funds, with respect to both past and future environmental spending, are accrued at fair value as an offset to environmental expense, net of allowance for collection risk, based on estimated recovery rates developed from our experience with the funds when such recoveries are considered probable.

Environmental exposures are difficult to assess and estimate for numerous reasons, including the extent of contamination, alternative treatment methods that may be applied, location of the property which subjects it to differing local laws and regulations and their interpretations, as well as the time it takes to remediate contamination. In developing our liability for probable and reasonably estimable environmental remediation costs on a property by property basis, we consider among other things, enacted laws and regulations, assessments of contamination and surrounding geology, quality of information available, currently available technologies for treatment, alternative methods of remediation and prior experience. Environmental accruals are based on estimates which are subject to significant change, and are adjusted as the remediation treatment progresses, as circumstances change and as environmental contingencies become more clearly defined and reasonably estimable.

Environmental liabilities and related assets are currently measured at fair value based on their expected future cash flows which have been adjusted for inflation and discounted to present value. We also use probability weighted alternative cash flow forecasts to determine fair value. We assumed a 50% probability factor that the actual environmental expenses will exceed engineering estimates for an amount assumed to equal one year of net expenses aggregating $4.5 million. Accordingly, the environmental accrual as of December 31, 2009 was increased by $1.8 million, net of assumed recoveries and before inflation and present value discount adjustments. The resulting net environmental accrual as of December 31, 2009 was then further increased by $1.0 million for the assumed impact of inflation using an inflation rate of 2.75%. Assuming a credit-adjusted risk-free discount rate of 7.0%, we then reduced the net environmental accrual, as previously adjusted, by a $2.1 million discount to present value. Had we assumed an inflation rate that was 0.5% higher and a discount rate that was 0.5% lower, net environmental liabilities as of December 31, 2009 would have increased by $0.2 million and $0.1 million, respectively, for an aggregate increase in the net environmental accrual of $0.3 million. However, the aggregate net change in estimated environmental estimates expense recorded during the year ended December 31, 2009 would not have changed significantly if these changes in the assumptions were made effective December 31, 2008.

In view of the uncertainties associated with environmental expenditures, contingencies concerning Marketing and the Marketing Leases and contingencies related to other parties, however, we believe it is possible that the fair value of future actual net expenditures could be substantially higher than these estimates. (See “— General — Marketing and the Marketing Leases” above for additional information.) Adjustments to accrued liabilities for environmental remediation costs will be reflected in our financial statements as they become probable and a reasonable estimate of fair value can be made. Future environmental costs could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

We cannot predict what environmental legislation or regulations may be enacted in the future or how existing laws or regulations will be administered or interpreted with respect to products or activities to which they have not previously been applied. We cannot predict if state UST fund programs will be administered and funded in the future in a manner that is consistent with past practices and if future environmental spending will continue to be eligible for reimbursement at historical recovery rates under these programs. Compliance with more stringent laws or regulations, as well as more vigorous enforcement policies of the regulatory agencies or stricter interpretation of existing laws, which may develop in the future, could have an adverse effect on our financial position, or that of our tenants, and could require substantial additional expenditures for future remediation.

Environmental litigation

We are subject to various legal proceedings and claims which arise in the ordinary course of our business. In addition, we have retained responsibility for certain legal proceedings and claims relating to the petroleum marketing business that were identified at the time of the Spin-Off. As of December 31, 2009 and December 31, 2008, we had accrued $3.8 million and $1.7 million, respectively, for certain of these matters which we believe were appropriate based on information then currently available. It is possible that our assumptions regarding the ultimate allocation method and share of responsibility that we used to allocate environmental liabilities may change, which may result in our providing an accrual, or adjustments to the amounts recorded, for environmental litigation accruals. Matters related to the Lower Passaic River and certain MTBE multi-district litigation cases, in particular, for which accruals have been provided in part, could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends and/or stock price. See “Item 3. Legal Proceedings” for additional information with respect these and other pending environmental lawsuits and claims.

The Lower Passaic River

In September 2003, we received a directive (the “Directive”) from the State of New Jersey Department of Environmental Protection (the “NJDEP”) that we are one of approximately sixty-six potentially responsible parties for natural resource damages resulting from discharges of hazardous substances into the Lower Passaic River. The Directive calls for an assessment of the natural resources that have been injured by the discharges into the Lower Passaic River and interim compensatory restoration for the injured natural resources. NJDEP alleges that our liability arises from alleged discharges originating from our Newark, New Jersey Terminal site. There has been no material activity with respect to the NJDEP Directive since early after its issuance. The responsibility for the alleged damages, the aggregate cost to remediate the Lower Passaic River, the amount of natural resource damages and the method of allocating such amounts among the potentially responsible parties have not been determined. We are a member of a Cooperating Parties Group which has agreed to take

over from the United States Environmental Protection Agency (“EPA”) performance of a remedial investigation and feasibility study intended to evaluate alternative remedial actions with respect to alleged damages to the Lower Passaic River. The remedial investigation and feasibility study does not resolve liability issues for remedial work or restoration of, or compensation for, natural resource damages to the Lower Passaic River, which are not known at this time.

In a related action, in December 2005, the State of New Jersey brought suit against certain companies which the State alleges are responsible for pollution of the Lower Passaic River. In February 2009, certain of these defendants filed third-party complaints against approximately three hundred additional parties, including us, seeking contribution for a pro-rata share of response costs, cleanup, and other damages. A Special Master has been appointed by the court to try and design an alternative dispute resolution process for achieving a global resolution of this litigation.

We believe that ChevronTexaco is contractually obligated to indemnify us, pursuant to an indemnification agreement for most, if not all of the conditions at the property identified by the NJDEP and the EPA. Our ultimate liability, if any, in the pending and possible future proceedings pertaining to the Lower Passaic River is uncertain and subject to numerous contingencies which cannot be predicted and the outcome of which are not yet known.

MTBE Litigation

As of December 31, 2009, we are defending against fifty-three lawsuits brought by or on behalf of private and public water providers and governmental agencies in Connecticut, Florida, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Vermont, Virginia, and West Virginia. These cases allege various theories of liability due to contamination of groundwater with MTBE as the basis for claims seeking compensatory and punitive damages, and name as defendant approximately fifty petroleum refiners, manufacturers, distributors and retailers of MTBE, or gasoline containing MTBE. Pursuant to consolidation procedures under federal law, most of the MTBE cases originally filed were transferred to the United States District Court for the Southern District of New York for coordinated Multi-District Litigation proceedings. We are presently named as a defendant in thirty-nine out of more than one hundred cases that have been consolidated in this Multi-District Litigation, and we are also named as a defendant in fourteen related MTBE cases pending in the Supreme Court of New York, Nassau County. A majority of the primary defendants entered into global settlement agreements which settled one hundred two individual cases brought by the same law firm on behalf of various plaintiffs. We remain a defendant in twenty-seven of these one hundred two cases. We are also a defendant in twenty-five other individual MTBE cases brought by another firm, and we are also a defendant in a final MTBE case in the consolidated Multi-District Litigation brought by the State of New Jersey.

In 2009, we provided litigation reserves of $2.3 million relating to a majority of the MTBE cases pending against us. However, we are still unable to estimate our liability for a minority of the cases pending against us. Further, notwithstanding that we have provided a litigation reserve as to certain of the MTBE cases, there remains uncertainty as to the accuracy of the allegations in these cases as they relate to us, our defenses to the claims, our rights to indemnification or contribution from Marketing, and the aggregate possible amount of damages for which we may be held liable.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

Prior to April 2006, when we entered into the Swap Agreement with JPMorgan Chase, N.A. (the “Swap Agreement”), we had not used derivative financial or commodity instruments for trading, speculative or any other purpose, and had not entered into any instruments to hedge our exposure to interest rate risk. We do not have any foreign operations, and are therefore not exposed to foreign currency exchange rate.

We are exposed to interest rate risk, primarily as a result of our $175.0 million Credit Agreement and our $25.0 million Term Loan Agreement. We use borrowings under the Credit Agreement to finance acquisitions and for general corporate purposes. We used borrowings under the Term Loan Agreement to partially finance an acquisition in September 2009. Total borrowings outstanding as of December 31, 2009 under the Credit Agreement and the Term Loan Agreement were $151.2 million and $24.4 million, respectively, bearing interest at a weighted-average rate of 1.8% per annum, or a weighted-average effective rate of 3.1% including the impact of the Swap Agreement discussed below. The weighted-average effective rate is based on (i) $106.2 million of LIBOR rate borrowings outstanding under the Credit Agreement floating at market rates plus a margin of 1.25%, (ii) $45.0 million of LIBOR rate borrowings outstanding under the Credit Agreement effectively fixed at 5.44% by the Swap Agreement plus a margin of 1.25% and (iii) $24.4 million of LIBOR based borrowings outstanding under

the Term Loan Agreement floating at market rates (subject to a 30 day LIBOR floor of 0.4%) plus a margin of 3.1%. Our Credit Agreement, which expires in March 2011, permits borrowings at an interest rate equal to the sum of a base rate plus a margin of 0.0% or 0.25% or a LIBOR rate plus a margin of 1.0%, 1.25% or 1.5%. The applicable margin is based on our leverage ratio at the end of the prior calendar quarter, as defined in the Credit Agreement, and is adjusted effective mid-quarter when our quarterly financial results are reported to the Bank Syndicate. Based on our leverage ratio as of December 31, 2009, the applicable margin will remain at 0.0% for base rate borrowings and 1.25% for LIBOR rate borrowings.

We manage our exposure to interest rate risk by minimizing, to the extent feasible, our overall borrowing and monitoring available financing alternatives. Our interest rate risk as of December 31, 2009 has increased significantly, as compared to December 31, 2008 primarily as a result of the $24.5 million drawn under the Credit Agreement to partially finance an acquisition in September 2009 and the $24.5 million borrowings outstanding under the $25.0 million three-year Term Loan Agreement entered into in September 2009. We entered into a $45.0 million LIBOR based interest rate Swap Agreement, effective through June 30, 2011, to manage a portion of our interest rate risk. The Swap Agreement is intended to hedge $45.0 million of our current exposure to variable interest rate risk by effectively fixing, at 5.44%, the LIBOR component of the interest rate determined under our existing Credit Agreement or future exposure to variable interest rate risk due to borrowing arrangements that may be entered into prior to the expiration of the Swap Agreement. As a result of the Swap Agreement, as of December 31, 2009, $45.0 million of our LIBOR based borrowings outstanding under the Credit Agreement bear interest at an effective rate of 6.69%. As a result, we are, and will be, exposed to interest rate risk to the extent that our aggregate borrowings floating at market rates exceed the $45.0 million notional amount of the Swap Agreement. As of December 31, 2009, our aggregate borrowings floating at market rates exceeded the notional amount of the Swap Agreement by $130.6 million. We do not foresee any significant changes in how we manage our interest rate risk in the near future.

We entered into the $45.0 million notional five year interest rate Swap Agreement, designated and qualifying as a cash flow hedge to reduce our exposure to the variability in future cash flows attributable to changes in the LIBOR rate. Our primary objective when undertaking hedging transactions and derivative positions is to reduce our variable interest rate risk by effectively fixing a portion of the interest rate for existing debt and anticipated refinancing transactions. This in turn, reduces the risks that the variability of cash flows imposes on variable rate debt. Our strategy protects us against future increases in interest rates. Although the Swap Agreement is intended to lessen the impact of rising interest rates, it also exposes us to the risk that the other party to the agreement will not perform, the agreement will be unenforceable and the underlying transactions will fail to qualify as a highly-effective cash flow hedge for accounting purposes. Further, there can be no assurance that the use of an interest rate swap will always be to our benefit. While the use of an interest rate Swap Agreement is intended to lessen the adverse impact of rising interest rates, it also conversely limits the positive impact that could be realized from falling interest rates with respect to the portion of our variable rate debt covered by the interest rate Swap Agreement.

In the event that we were to settle the Swap Agreement prior to its maturity, if the corresponding LIBOR swap rate for the remaining term of the Swap Agreement is below the 5.44% fixed strike rate at the time we settle the Swap Agreement, we would be required to make a payment to the Swap Agreement counter-party; if the corresponding LIBOR swap rate is above the fixed strike rate at the time we settle the Swap Agreement, we would receive a payment from the Swap Agreement counter-party. The amount that we would either pay or receive would equal the present value of the basis point differential between the fixed strike rate and the corresponding LIBOR swap rate at the time we settle the Swap Agreement.

Based on our aggregate average outstanding borrowings under the Credit Agreement and the Term Loan Agreement projected at $178.8 million for 2010, an increase in market interest rates of 0.5% for 2010 would decrease our 2010 net income and cash flows by $0.7 million. This amount was determined by calculating the effect of a hypothetical interest rate change on our aggregate borrowings floating at market rates that is not covered by our $45.0 million interest rate Swap Agreement and assumes that the $154.9 million average outstanding borrowings under the Credit Agreement during the fourth quarter of 2009 plus the $23.9 million average scheduled outstanding borrowings for 2010 under the Term Loan Agreement is indicative of our future average borrowings for 2010 before considering additional borrowings required for future acquisitions. The calculation also assumes that there are no other changes in our financial structure or the terms of our borrowings. Our exposure to fluctuations in interest rates will increase or decrease in the future with increases or decreases in the outstanding amount under our Credit Agreement and decreases in the outstanding amount under our Term Loan Agreement.

In order to minimize our exposure to credit risk associated with financial instruments, we place our temporary cash investments with high-credit-quality institutions. Temporary cash investments, if any, are currently held in an overnight bank time deposit with JPMorgan Chase Bank, N.A

Item 8. Financial Statements and Supplementary Data

GETTY REALTY CORP. INDEX TO FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA


		(PAGES)


Consolidated Statements of Operations for the years ended December 31, 2009, 2008 and 2007		51
Consolidated Statements of Comprehensive Income for the years ended December 31, 2009, 2008 and 2007		51
Consolidated Balance Sheets as of December 31, 2009 and 2008		52
Consolidated Statements of Cash Flows for the years ended December 31, 2009, 2008 and 2007		53
Notes to Consolidated Financial Statements (including the supplementary financial information contained in Note 9 “Quarterly Financial Data”)		54
Report of Independent Registered Public Accounting Firm		80

GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)


	YEAR ENDED DECEMBER 31,

	2009			2008			2007

Revenues from rental properties	$	84,539		$	82,802		$	79,207
Operating expenses:
Rental property expenses		10,851			11,482			10,864
Impairment charges		1,135			—			—
Environmental expenses, net		8,799			7,365			8,189
General and administrative expenses		6,849			6,831			6,669
Allowance for deferred rent receivable		—			—			10,206
Depreciation and amortization expense		10,975			11,726			9,600

Total operating expenses		38,609			37,404			45,528

Operating income		45,930			45,398			33,679
Other income, net		585			403			1,923
Interest expense		(5,091	)		(7,034	)		(7,760	)

Earnings from continuing operations		41,424			38,767			27,842
Discontinued operations:
Earnings from operating activities		299			645			1,487
Gains on dispositions of real estate		5,326			2,398			4,565

Earnings from discontinued operations		5,625			3,043			6,052

Net earnings	$	47,049		$	41,810		$	33,894


Basic and diluted earnings per common share:
Earnings from continuing operations	$	1.67		$	1.57		$	1.12
Earnings from discontinued operations	$	.23		$	.12		$	.24
Net earnings	$	1.90		$	1.69		$	1.37

Weighted average shares outstanding:
Basic		24,766			24,766			24,765
Stock options		1			1			4

Diluted		24,767			24,767			24,769

The accompanying notes are an integral part of these consolidated financial statements.

GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)


	YEAR ENDED DECEMBER 31,

	2009		2008			2007

Net earnings	$	47,049	$	41,810		$	33,894
Other comprehensive loss:
Net unrealized gain (loss) on interest rate swap		1,303		(1,997	)		(1,478	)

Comprehensive Income	$	48,352	$	39,813		$	32,416

The accompanying notes are an integral part of these consolidated financial statements.

GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)


	DECEMBER 31,

	2009			2008

ASSETS:
Real Estate:
Land	$	252,083		$	221,540
Buildings and improvements		251,791			252,027

		503,874			473,567
Less — accumulated depreciation and amortization		(136,669	)		(129,322	)

Real estate, net		367,205			344,245
Net investment in direct financing lease		19,156			—
Deferred rent receivable (net of allowance of $9,389 at December 31, 2009 and $10,029 at December 31, 2008)		27,481			26,718
Cash and cash equivalents		3,050			2,178
Recoveries from state underground storage tank funds, net		3,882			4,223
Mortgages and accounts receivable, net		2,402			1,533
Prepaid expenses and other assets		9,696			8,916

Total assets	$	432,872		$	387,813


LIABILITIES AND SHAREHOLDERS’ EQUITY:
Borrowings under credit line	$	151,200		$	130,250
Term loan		24,370			—
Environmental remediation costs		16,527			17,660
Dividends payable		11,805			11,669
Accounts payable and accrued expenses		21,301			22,337

Total liabilities		225,203			181,916

Commitments and contingencies (notes 2, 3, 5 and 6)
Shareholders’ equity:
Common stock, par value $.01 per share; authorized 50,000,000 shares; issued 24,766,376 at December 31, 2009 and 24,766,166 at December 31, 2008		248			248
Paid-in capital		259,459			259,069
Dividends paid in excess of earnings		(49,045	)		(49,124	)
Accumulated other comprehensive loss		(2,993	)		(4,296	)

Total shareholders’ equity		207,669			205,897

Total liabilities and shareholders’ equity	$	432,872		$	387,813

The accompanying notes are an integral part of these consolidated financial statements.

GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)


	YEAR ENDED DECEMBER 31,

	2009			2008			2007

CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$	47,049		$	41,810		$	33,894
Adjustments to reconcile net earnings to net cash flow provided by operating activities:
Depreciation and amortization expense		11,027			11,875			9,794
Impairment charges		1,135			—			—
Gain from dispositions of real estate		(5,467	)		(2,787	)		(6,179	)
Deferred rental revenue, net of allowance		(763	)		(1,803	)		(3,112	)
Allowance for deferred rent receivable		—			—			10,494
Amortization of above-market and below-market leases		(1,217	)		(790	)		(1,047	)
Amortization of investment in direct financing lease		(85	)		—			—
Accretion expense		884			956			974
Stock-based employee compensation expense		390			326			492
Changes in assets and liabilities:
Recoveries from state underground storage tank funds, net		724			827			(379	)
Mortgages and accounts receivable, net		(724	)		(5	)		44
Prepaid expenses and other assets		339			423			(130	)
Environmental remediation costs		(2,400	)		(2,217	)		(80	)
Accounts payable and accrued expenses		1,640			(1,031	)		(249	)

Net cash flow provided by operating activities		52,532			47,584			44,516


CASH FLOWS FROM INVESTING ACTIVITIES:
Property acquisitions and capital expenditures		(55,317	)		(6,579	)		(90,636	)
Proceeds from dispositions of real estate		6,939			5,295			8,420
(Increase) decrease in cash held for property acquisitions		(1,623	)		2,397			(2,079	)
Collection (issuance) of mortgages receivable, net		(145	)		(55	)		267

Net cash flow provided by (used in) investing activities		(50,146	)		1,058			(84,028	)


CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings (repayments) under credit agreement, net		20,950			(2,250	)		87,500
Borrowings under term loan agreement, net		24,370			—			—
Cash dividends paid		(46,834	)		(46,294	)		(45,650	)
Credit agreement origination costs		—			—			(863	)
Cash paid in settlement of restricted stock units		—			—			(405	)
Repayment of mortgages payable, net		—			—			(194	)
Proceeds from stock options exercised		—			9			—

Net cash flow provided by (used in) financing activities		(1,514	)		(48,535	)		40,388

Net increase in cash and cash equivalents		872			107			876
Cash and cash equivalents at beginning of period		2,178			2,071			1,195

Cash and cash equivalents at end of year	$	3,050		$	2,178		$	2,071


Supplemental disclosures of cash flow information
Cash paid (refunded) during the year for:
Interest	$	5,046		$	6,728		$	7,021
Income taxes, net		467			708			488
Recoveries from state underground storage tank funds		(1,411	)		(1,511	)		(1,644	)
Environmental remediation costs		6,154			6,542			6,314

The accompanying notes are an integral part of these consolidated financial statements.

GETTY REALTY CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation: The consolidated financial statements include the accounts of Getty Realty Corp. and its wholly-owned subsidiaries (the “Company”). The Company is a real estate investment trust (“REIT”) specializing in the ownership and leasing of retail motor fuel and convenience store properties and petroleum distribution terminals. The Company manages and evaluates its operations as a single segment. All significant intercompany accounts and transactions have been eliminated.

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). In 2009, the Financial Accounting Standards Board (“FASB”) established the Accounting Standards Codification, as amended (the “ASC”), as the sole reference source of authoritative accounting principles recognized by the FASB to be applied by non-governmental entities in the preparation of financial statements in conformity with GAAP. The Company adopted the codification during the quarter ended September 30, 2009 which had no impact on the Company’s financial position, results of operations or cash flows.

Use of Estimates, Judgments and Assumptions: The financial statements have been prepared in conformity with GAAP, which requires the Company’s management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the period reported. While all available information has been considered, actual results could differ from those estimates, judgments and assumptions. Estimates, judgments and assumptions underlying the accompanying consolidated financial statements include, but are not limited to, deferred rent receivable, net investment in direct financing lease, recoveries from state underground storage tank (“UST” or ‘USTs”) funds, environmental remediation costs, real estate, depreciation and amortization, impairment of long-lived assets, litigation, accrued expenses, income taxes and the allocation of the purchase price of properties acquired to the assets acquired and liabilities assumed.

Discontinued Operations: The operating results and gains from certain dispositions of real estate sold in 2009, 2008 and 2007 are reclassified as discontinued operations. The operating results for the years ended 2008 and 2007 of such properties sold in 2009 have also been reclassified to discontinued operations to conform to the 2009 presentation. Discontinued operations for the year ended December 31, 2009, 2008 and 2007 are primarily comprised of gains or losses from property dispositions. The revenue from rental properties and expenses related to these properties are insignificant for the each of the three years ended December 31, 2009, 2008 and 2007.

Real Estate: Real estate assets are stated at cost less accumulated depreciation and amortization. Upon acquisition of real estate operating properties and leasehold interests, the Company estimates the fair value of acquired tangible assets (consisting of land, buildings and improvements) “as if vacant” and identified intangible assets and liabilities (consisting of leasehold interests, above-market and below-market leases, in-place leases and tenant relationships) and assumed debt. Based on these estimates, the Company allocates the purchase price to the applicable assets and liabilities. When real estate assets are sold or retired, the cost and related accumulated depreciation and amortization is eliminated from the respective accounts and any gain or loss is credited or charged to income. Expenditures for maintenance and repairs are charged to income when incurred.

Depreciation and amortization: Depreciation of real estate is computed on the straight-line method based upon the estimated useful lives of the assets, which generally range from sixteen to twenty-five years for buildings and improvements, or the term of the lease if shorter. Leasehold interests, capitalized above-market and below-market leases, in-place leases and tenant relationships are amortized over the remaining term of the underlying lease.

Impairment of Long-Lived Assets and Long-Lived Assets to Be Disposed Of: Assets are written down to fair value (determined on a nonrecurring basis using a discounted cash flow method and significant unobservable inputs) when events and circumstances indicate that the assets might be impaired and the projected undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets. The Company reviews and adjusts as necessary its depreciation estimates and method when long-lived assets are tested for recoverability. Assets held for disposal are written down to fair value less disposition costs.

Cash and Cash Equivalents: The Company considers highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Deferred Rent Receivable and Revenue Recognition: The Company earns rental income under operating leases and direct financing leases with tenants. Minimum lease rentals and lease termination payments from operating leases are recognized on a straight-line basis over the term of the leases. The cumulative difference between lease revenue recognized under this method and the contractual lease payment terms is recorded as deferred rent receivable on the consolidated balance sheet. The Company provides reserves for a portion of the recorded deferred rent receivable if circumstances indicate that a property may be disposed of before the end of the current lease term or if it is not reasonable to assume that the tenant will not make all of its contractual lease payments when due during the current term of the lease. The straight-line method requires that rental income related to those properties for which a reserve was provided is effectively recognized in subsequent periods when payment is due under the contractual payment terms. Lease termination fees are recognized as rental income when earned upon the termination of a tenant’s lease and relinquishment of space in which the Company has no further obligation to the tenant. The present value of the difference between the fair market rent and the contractual rent for in-place leases at the time properties are acquired is amortized into revenue from rental properties over the remaining lives of the in-place leases.

Direct Financing Lease: Income under a direct financing lease is included in revenues from rental properties and is recognized over the lease term using the effective interest rate method which produces a constant periodic rate of return on the net investment in the leased property. Net investment in direct financing lease represents the investment in leased assets accounted for as a direct financing lease. The investment in direct financing lease is increased for interest income earned and amortized over the life of the lease and reduced by the receipt of lease payments.

Environmental Remediation Costs and Recoveries from State UST Funds, Net: The estimated future costs for known environmental remediation requirements are accrued when it is probable that a liability has been incurred, including legal obligations associated with the retirement of tangible long-lived assets if the asset retirement obligation results from the normal operation of those assets and a reasonable estimate of fair value can be made. The environmental remediation liability is estimated based on the level and impact of contamination at each property. The accrued liability is the aggregate of the best estimate of the fair value of cost for each component of the liability. Recoveries of environmental costs from state UST remediation funds, with respect to both past and future environmental spending, are accrued at fair value as an offset to environmental expense, net of allowance for collection risk, based on estimated recovery rates developed from prior experience with the funds when such recoveries are considered probable. Environmental liabilities and related assets are currently measured based on their expected future cash flows which have been adjusted for inflation and discounted to present value. The Company will accrue for environmental liabilities that it believes are allocable to other potentially responsible parties if it becomes probable that the other parties will not pay their environmental obligations.

Litigation: Legal fees related to litigation are expensed as legal services are performed. The Company provides for litigation reserves, including certain litigation related to environmental matters, when it is probable that a liability has been incurred and a reasonable estimate of the liability can be made. If the estimate of the liability can only be identified as a range, and no amount within the range is a better estimate than any other amount, the minimum of the range is accrued for the liability. The Company accrues its share of environmental liabilities based on its assumptions of the ultimate allocation method and share that will be used when determining its share of responsibility.

Income Taxes: The Company and its subsidiaries file a consolidated federal income tax return. Effective January 1, 2001, the Company elected to qualify, and believes it is operating so as to qualify, as a REIT for federal income tax purposes. Accordingly, the Company generally will not be subject to federal income tax, provided that distributions to its shareholders equal at least the amount of its REIT taxable income as defined under the Internal Revenue Code. If the Company sells any property within ten years after its REIT election that is not exchanged for a like-kind property, it will be taxed on the built-in gain realized from such sale at the highest corporate rate. This ten-year built-in gain tax period will end on January 1, 2011.

Interest Expense and Interest Rate Swap Agreement: In April 2006 the Company entered into an interest rate swap agreement with JPMorgan Chase Bank, N.A. as the counterparty, designated and qualifying as a cash flow hedge, to reduce its variable interest rate risk by effectively fixing a portion of the interest rate for existing debt and anticipated refinancing transactions. The Company has not entered into financial instruments for trading or speculative purposes. The fair value of the derivative is reflected on the consolidated balance sheet and will be reclassified as a component of interest expense over the remaining term of the interest rate swap agreement since the Company does not expect to settle the interest rate swap

prior to its maturity. The fair value of the interest rate swap obligation is based upon the estimated amounts the Company would receive or pay to terminate the contract and is determined using an interest rate market pricing model. Changes in the fair value of the agreement are included in the consolidated statements of comprehensive income and would be recorded in the consolidated statements of operations if the agreement was not an effective cash flow hedge for accounting purposes.

Earnings per Common Share: Basic earnings per common share gives effect, utilizing the two-class method, to the potential dilution from the issuance of common shares in settlement of restricted stock units (“RSUs” or “RSU”) which provide for non-forfeitable dividend equivalents equal to the dividends declared per common share. Basic earnings per common share is computed by dividing net earnings less dividend equivalents attributable to RSUs by the weighted-average number of common shares outstanding during the year. Diluted earnings per common share also gives effect to the potential dilution from the exercise of stock options utilizing the treasury stock method. (in thousands)



	Year ended December 31,

	2009			2008			2007

Earnings from continuing operations	$	41,424		$	38,767		$	27,842
Less dividend equivalents attributable to restricted stock units outstanding		(162	)		(117	)		(85	)

Earnings from continuing operations attributable to common shareholders used for basic earnings per share calculation		41,262			38,650			27,757
Discontinued operations		5,625			3,043			6,052

Net earnings attributable to common shareholders used for basic earnings per share calculation	$	46,887		$	41,693		$	33,809


Weighted-average number of common shares outstanding:
Basic		24,766			24,766			24,765
Stock options		1			1			4

Diluted		24,767			24,767			24,769


Restricted stock units outstanding at the end of the period		86			62			39

Stock-Based Compensation: Compensation cost for the Company’s stock-based compensation plans using the fair value method was $390,000, $326,000 and $492,000 for the years ended 2009, 2008 and 2007, respectively, and is included in general and administrative expense. The impact of the accounting for stock-based compensation is, and is expected to be, immaterial to the Company’s financial position and results of operations.

Recent Accounting Developments and Amendments to the Accounting Standards Codification: In September 2006, the FASB amended the accounting standards related to fair value measurements of assets and liabilities (the “Fair Value Measurements Amendment”). The Fair Value Measurements Amendment generally applies whenever other standards require assets or liabilities to be measured at fair value. The Fair Value Measurements Amendment was effective in fiscal years beginning after November 15, 2007. Subsequently, the FASB delayed the effective date of the Fair Value Measurements Amendment by one year for nonfinancial assets and liabilities that are recognized or disclosed at fair value on a nonrecurring basis to fiscal years beginning after November 15, 2008. The adoption of the Fair Value Measurements Amendment in January 2008 and the adoption of the provisions of the Fair Value Measurements Amendment for nonfinancial assets and liabilities that are recognized or disclosed at fair value on a nonrecurring basis in January 2009 did not have a material impact on the Company’s financial position and results of operations.

In December 2007, the FASB amended the accounting standards related to business combinations (the “Business Combinations Amendment”) affecting how the acquirer shall recognize and measure in its financial statements at fair value the identifiable assets acquired, liabilities assumed, any non-controlling interest in the acquiree and goodwill acquired in a business combination. The Business Combinations Amendment requires that acquisition costs, which could be material to the Company’s future financial results, will be expensed rather than included as part of the basis of the acquisition. The adoption of the Business Combinations Amendment by the Company in January 2009 did not result in a write-off of acquisition related transactions costs associated with transactions not yet consummated.

The FASB amended the accounting standards related to determining earnings per share (the “Earnings Per Share Amendment”). Due to the adoption of the “Earnings Per Share Amendment” effective as of January 1, 2009 and retrospectively applied to the years ended 2008 and 2007, basic earnings per common share gives effect, utilizing the two-class method, to the potential dilution from the issuance of common shares in settlement of restricted stock units (“RSUs” or “RSU”) which provide for non-forfeitable dividend equivalents equal to the dividends declared per common share. The adoption of the “Earnings Per Share Amendment” did not have a material impact in the determination of earnings per common share for the years ended December 31, 2009, 2008 and 2007.

2. LEASES

The Company leases or sublets its properties primarily to distributors and retailers engaged in the sale of gasoline and other motor fuel products, convenience store products and automotive repair services who are responsible for managing the operations conducted at these properties and for the payment of taxes, maintenance, repair, insurance and other operating expenses related to these properties. In those instances where the Company determines that the best use for a property is no longer as a retail motor fuel outlet, the Company will seek an alternative tenant or buyer for the property. The Company leases or subleases approximately twenty of its properties for uses such as fast food restaurants, automobile sales and other retail purposes. The Company’s properties are primarily located in the Northeast and Mid-Atlantic regions of the United States. The Company also owns or leases properties in Texas, North Carolina, Hawaii, California, Florida, Ohio, Arkansas, Illinois, and North Dakota.

As of December 31, 2009, Getty Petroleum Marketing Inc. (“Marketing”) leased from the Company, eight hundred forty properties. Eight hundred thirty of the properties are leased to Marketing under a unitary master lease (the “Master Lease”) and ten properties are leased under supplemental leases (collectively with the Master Lease, the “Marketing Leases”). The Master Lease has an initial term of fifteen years commencing December 9, 2000, and generally provides Marketing with options for three renewal terms of ten years each and a final renewal option of three years and ten months extending to 2049 (or such shorter initial or renewal term as the underlying lease may provide). The Marketing Leases include provisions for 2% annual rent escalations. The Master Lease is a unitary lease and, therefore, Marketing’s exercise of any renewal option can only be on an “all or nothing” basis. The supplemental leases have initial terms of varying expiration dates. (See note 11 for additional information regarding the portion of the Company’s financial results that are attributable to Marketing. See note 3 for additional information regarding contingencies related to Marketing and the Marketing Leases).

The Company estimates that Marketing makes annual real estate tax payments for properties leased under the Marketing Leases of approximately $13,000,000. Marketing also makes additional payments for other operating expenses related to these properties, including environmental remediation costs other than those liabilities that were retained by the Company. These costs, which have been assumed by Marketing under the terms of the Marketing Leases, are not reflected in the Company’s consolidated financial statements.

Revenues from rental properties included in continuing operations for the years ended December 31, 2009, 2008 and 2007 were $84,539,000, $82,802,000 and $79,207,000, respectively, of which $59,956,000, $60,047,000 and $59,259,000, respectively, were received from Marketing under the Marketing Leases and $2,236,000, $2,113,000 and $1,580,000, respectively, were received from other tenants for reimbursement of real estate taxes. In accordance with GAAP, the Company recognizes rental revenue in amounts which vary from the amount of rent contractually due or received during the periods presented. As a result, revenues from rental properties include non-cash adjustments recorded for deferred rental revenue due to the recognition of rental income on a straight-line (or an average) basis over the current lease term, net amortization of above-market and below-market leases and recognition of rental income recorded under a direct financing lease using the effective interest method which produces a constant periodic rate of return on the net investment in the leased property (the “Revenue Recognition Adjustments”). Revenues from rental properties included in continuing operations for the years ended December 31, 2009, 2008 and 2007 include Revenue Recognition Adjustments of $2,026,000, 2,537,000 and $3,605,000, respectively. In the year ended December 31, 2007, the Company provided a non-cash $10,494,000 reserve for a portion of the deferred rent receivable recorded as of December 31, 2007 related to the Marketing Leases, $10,206,000 of which is included in earnings from continuing operations and $288,000 of which is included in earnings from discontinued operations. (See footnote 3 for additional information related to the Marketing Leases and the reserve.)

The components of the $19,156,000 net investment in direct financing lease as of December 31, 2009, are minimum lease payments receivable of $78,187,000 plus unguaranteed estimated residual value of $1,907,000 less unearned income of $60,938,000.

Future contractual minimum annual rentals receivable from Marketing under the Marketing Leases and from other tenants, which have terms in excess of one year as of December 31, 2009, are as follows (in thousands)(See footnote 3 for additional information related to the Marketing Leases and the reserve):


	OPERATING LEASES
							DIRECT FINANCING LEASE
YEAR ENDING DECEMBER 31,			OTHER TENANTS
YEAR ENDING DECEMBER 31,	MARKETING		OTHER TENANTS		SUBTOTAL				TOTAL (a)

2010	$	59,400	$	22,140	$	81,540	$	3,110	$	84,650
2011		59,377		22,462		81,839		3,188		85,027
2012		59,679		22,378		82,057		3,268		85,325
2013		59,770		21,924		81,694		3,349		85,043
2014		60,409		21,195		81,604		3,433		85,037
Thereafter		57,082		163,211		220,293		61,839		282,132


	(a)	Includes $64,196,000 of future minimum annual rentals receivable under subleases.

Rent expense, substantially all of which consists of minimum rentals on non-cancelable operating leases, amounted to $7,323,000, $8,100,000 and $8,337,000 for the years ended December 31, 2009, 2008 and 2007, respectively, and is included in rental property expenses using the straight-line method. Rent received under subleases for the years ended December 31, 2009, 2008 and 2007 was $12,760,000, $13,986,000 and $14,145,000, respectively.

The Company has obligations to lessors under non-cancelable operating leases which have terms (excluding renewal term options) in excess of one year, principally for gasoline stations and convenience stores. The leased properties have a remaining lease term averaging over eleven years, including renewal options. Future minimum annual rentals payable under such leases, excluding renewal options, are as follows: 2010 — $6,673,000, 2011 — $5,487,000, 2012 — $3,986,000, 2013 — $2,810,000, 2014 — $1,868,000 and $2,958,000 thereafter.

3. COMMITMENTS AND CONTINGENCIES

In order to minimize the Company’s exposure to credit risk associated with financial instruments, the Company places its temporary cash investments, if any, with high credit quality institutions. Temporary cash investments, if any, are currently held in an overnight bank time deposit with JPMorgan Chase Bank, N.A.

As of December 31, 2009, the Company leased eight hundred forty properties, or 78% of its one thousand seventy-one properties, on a long-term triple-net basis to Marketing, a wholly-owned subsidiary of OAO LUKoil (“Lukoil”), one of the largest integrated Russian oil companies (see note 2 for additional information).

The Company’s financial results are materially dependent upon the ability of Marketing to meet its rental and environmental obligations under the Marketing Leases. Marketing’s financial results depend on retail petroleum marketing margins from the sale of refined petroleum products and rental income from its subtenants. Marketing’s subtenants either operate their gas stations, convenience stores, automotive repair services or other businesses at the Company’s properties or are petroleum distributors who may operate the Company’s properties directly and/or sublet the Company’s properties to the operators. Since a substantial portion of the Company’s revenues (71% for the year December 31, 2009), are derived from the Marketing Leases, any factor that adversely affects Marketing’s ability to meet its obligations under the Marketing Leases may have a material adverse effect on the Company’s business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price. (See note 11 for additional information regarding the portion of the Company’s financial results that are attributable to Marketing.) Marketing’s financial results depend largely on retail petroleum marketing margins from the sale of refined petroleum products at margins in excess of its fixed and variable expenses, performance of the petroleum marketing industry and rental income from its sub-tenants who operate their respective convenience stores, automotive repair services or other businesses at the Company’s properties. The petroleum marketing industry has been and continues to be volatile and highly competitive. Marketing has made all required monthly

rental payments under the Marketing Leases when due through March 2010, although there can be no assurance that it will continue to do so.

For the year ended December 31, 2008, Marketing reported a significant loss, continuing a trend of reporting large losses in recent years. The Company has not received Marketing’s operating results for the year ended December 31, 2009. As a result of Marketing’s significant losses for each of the three years ended December 31, 2008, 2007 and 2006 and the cumulative impact of those losses on Marketing’s financial position as of December 31, 2008, the Company previously concluded that Marketing likely does not have the ability to generate cash flows from its business sufficient to meet its obligations as they come due in the ordinary course through the term of the Marketing Leases unless Marketing shows significant improvement in its financial results, generates sufficient liquidity through the sale of assets or otherwise, or receives financial support from Lukoil, its parent company.

In the fourth quarter of 2009, Marketing announced a restructuring of its business. Marketing disclosed that the restructuring included the sale of all assets unrelated to the properties it leases from the Company, the elimination of parent-guaranteed debt, and steps to reduce operating costs. Marketing sold all assets unrelated to the properties it leases from the Company to its affiliates, LUKOIL Pan Americas L.L.C. and LUKOIL North America LLC. Marketing paid off debt which had been guaranteed by Lukoil with proceeds from the sale of assets to Lukoil affiliates and with financial support from Lukoil. Marketing also announced additional steps to reduce its costs including closing two marketing regions, eliminating jobs and exiting the direct-supplied retail gasoline business. Marketing’s announcement also indicated that LUKOIL North America LLC is the vehicle through which Lukoil expects to concentrate its future growth in the United States.

The Company believes that Marketing is exiting the direct-supplied retail gasoline business by entering into subleases with petroleum distributors who supply their own petroleum products to the Company’s properties. Approximately two hundred fifty retail properties, comprising substantially all of the properties in New England that the Company leases to Marketing, have been subleased by Marketing to a single distributor. These properties are in the process of being rebranded BP stations and are being supplied petroleum products under a supply contract with BP. In addition, the Company believes that Marketing recently entered into a sublease with a single distributor in New Jersey covering approximately eighty-five of our properties. The Company believes that Marketing is seeking subtenants for other significant portions of the portfolio of properties it leases from it.

In connection with its restructuring, Marketing eliminated debt which had been guaranteed by Lukoil with proceeds from the sale of assets to Lukoil affiliates and with financial support from Lukoil, which the Company believes increased Marketing’s liquidity and improved its balance sheet. However, the Company cannot predict whether the restructuring announced by Marketing will stem Marketing’s recent history of significant annual operating losses, and whether Marketing will continue to be dependent on financial support from Lukoil to meet its obligations as they become due and through the terms of the Marketing Leases. The Company continues to believe that to the extent Marketing requires continued financial support from Lukoil, that it is probable that Lukoil will continue to provide such financial support. Lukoil is not, however, a guarantor of the Marketing Leases. Even though Marketing is a wholly-owned subsidiary of Lukoil, and Lukoil has provided capital to Marketing in the past, there can be no assurance that Lukoil will provide financial support or additional capital to Marketing in the future. It is reasonably possible that the Company’s belief regarding the likelihood of Lukoil providing continuing financial support to Marketing will prove to be incorrect or will change as circumstances change.

From time to time the Company has held discussions with representatives of Marketing regarding potential modifications to the Marketing Leases. These efforts have been unsuccessful to date as the Company has not yet reached a common understanding with Marketing that would form a basis for modification of the Marketing Leases. From time to time, however, the Company has been able to agree with Marketing on terms to allow for removal of individual properties from the Marketing Leases as mutually beneficial opportunities arise. The Company intends to continue to pursue the removal of individual properties from the Marketing Leases, and it remains open to removal of groups of properties; however, there is no fixed agreement in place providing for removal of properties from the Marketing Leases. Accordingly, the removal of properties from the Marketing Leases is subject to negotiation on a case-by-case basis. If Marketing ultimately determines that its business strategy is to exit all or a portion of the properties it leases from the Company, it is the Company’s intention to cooperate with Marketing in accomplishing those objectives if the Company determines that it is prudent for it to do so. Any modification of the Marketing Leases that removes a significant number of properties from the Marketing Leases would likely significantly reduce the amount of rent the Company receives from Marketing and increase the Company’s operating expenses. The Company cannot accurately predict if, or when, the Marketing Leases will be modified; what composition of properties, if any, may be removed from the Marketing Leases as part of any such modification; or what the terms of any

agreement for modification of the Marketing Leases may be. The Company also cannot accurately predict what actions Marketing and Lukoil may take, and what the Company’s recourse may be, whether the Marketing Leases are modified or not.

The Company intends either to re-let or sell any properties that are removed from the Marketing Leases, whether such removal arises consensually by negotiation or as a result of default by Marketing, and reinvest any realized sales proceeds in new properties. The Company intends to offer properties removed from the Marketing Leases to replacement tenants or buyers individually, or in groups of properties, or by seeking a single tenant for the entire portfolio of properties subject to the Marketing Leases. Although the Company is the fee or leasehold owner of the properties subject to the Marketing Leases and the owner of the Getty® brand and has prior experience with tenants who operate their convenience stores, automotive repair services or other businesses at its properties; in the event that properties are removed from the Marketing Leases, the Company cannot accurately predict if, when, or on what terms, such properties could be re-let or sold.

As permitted under the terms of the Marketing Leases, Marketing generally can, subject to any contrary terms under applicable third party leases, use each property for any lawful purpose, or for no purpose whatsoever. The Company believes that as of December 31, 2009, Marketing had removed, or has scheduled removal of, underground gasoline storage tanks and related equipment at approximately one hundred fifty, or 18%, of the Company’s properties and the Company also believes that most of these properties are either vacant or provide negative or marginal contribution to Marketing’s results. Marketing recently agreed to permit the Company to list with brokers and to show to prospective purchasers and lessees seventy-five of the properties where Marketing has removed, or has scheduled to remove, underground gasoline storage tanks and related equipment, and the Company is marketing such properties for sale or leasing. As previously discussed, however, there is no agreement between the Company and Marketing on terms for removal of properties from the Marketing Leases. In those instances where the Company determines that the best use for a property is no longer as a retail motor fuel outlet, the Company will seek an alternative tenant or buyer for such property. With respect to properties that are vacant or have had underground gasoline storage tanks and related equipment removed, it may be more difficult or costly to re-let or sell such properties as gas stations because of capital costs or possible zoning or permitting rights that are required and that may have lapsed during the period since gasoline was last sold at the property. Conversely, it may be easier to re-let or sell properties where underground gasoline storage tanks and related equipment have been removed if the property will not be used as a retail motor fuel outlet or if environmental contamination has been remediated.

Based on the Company’s prior decision to attempt to negotiate with Marketing for a modification of the Marketing Leases to remove approximately 40% of the properties from the Marketing Leases, the Company concluded that it cannot reasonably assume that it will collect all of the rent due to the Company related to those properties for the remainder of the current term of each lease comprising the Marketing Leases. Accordingly, the Company recorded a $10,494,000 non-cash deferred rent receivable reserve as of December 31, 2007 based on the deferred rent receivable recorded related to the those properties because the Company then believed those properties were most likely to be removed from the Marketing Leases as a result of a modification of the Marketing Leases. Providing this non-cash deferred rent receivable reserve reduced the Company’s net earnings but did not impact the Company’s cash flow from operating activities for 2007. The deferred rent receivable and the related $10,494,000 deferred rent receivable reserve have declined since December 31, 2007 as a result of regular monthly lease payments being made by Marketing and the removal of individual properties from the Marketing Leases.

The Company continues to believe that it is likely that the Marketing Leases will be modified and therefore it cannot reasonably assume that it will collect all of the rent due to the Company for the entire portfolio of properties it leases to Marketing for the remainder of the current term of each lease comprising the Marketing Leases. However, as a result of Marketing’s restructuring announced in the fourth quarter of 2009 and the potential effect on the Company’s properties caused by changes in Marketing’s business model, the Company reevaluated the entire portfolio of properties it leases to Marketing, and reconstituted the list of properties that the Company used to estimate the deferred rent receivable reserve as of December 31, 2009. The Company reviewed the properties that had previously been designated to the Company by Marketing for removal and which were the subject of its prior decision to attempt to negotiate with Marketing for a modification of the Marketing Leases and from that group of properties, the Company excluded properties that it no longer considered to be the most likely to be removed from the Marketing Leases, such as those which are subject to significant subleases between Marketing and various distributors (as described above) and third party leased properties. Then, to the group of properties remaining, the Company added properties previously designated by Marketing for removal from time to time and properties that the Company believe are currently negative or marginal contributors to Marketing’s results, such as those that are vacant or have had tanks removed. Based on its reevaluation of the entire portfolio of properties we lease to Marketing, the Company identified three hundred fifty properties

as being the most likely to be removed from the Marketing Leases. The Company’s estimate of the deferred rent receivable reserve as of December 31, 2009 of $9.4 million is based on the deferred rent receivable attributable to these three hundred fifty properties. The Company has not provided a deferred rent receivable reserve related to the remaining properties subject to the Marketing Leases since, based on its assessments and assumptions, the Company continues to believe that it is probable that it will collect the deferred rent receivable related to those remaining properties and that Lukoil will not allow Marketing to fail to perform its rental, environmental and other obligations under the Marketing Leases.

The Company has performed an impairment analysis of the carrying amount of the properties subject to the Marketing Leases from time to time in accordance with GAAP when indicators of impairment exist. During the year ended December 31, 2008, the Company reduced the estimated useful lives of certain long-lived assets for properties subject to the Marketing Leases resulting in accelerating the depreciation expense recorded for those assets. The impact to depreciation expense due to adjusting the estimated lives for certain long-lived assets beginning with the year ended December 31, 2008 was not material. During the year ended December 31, 2009, the Company reduced the carrying amount to fair value, and recorded impairment charges aggregating $1,135,000, for certain properties leased to Marketing where the carrying amount of the property exceeded the estimated undiscounted cash flows expected to be received during the assumed holding period and the estimated net sales value expected to be received at disposition. The impairment charges were attributable to general reductions in real estate valuations and, in certain cases, by the removal or scheduled removal of underground storage tanks by Marketing. The fair value of real estate is estimated based on the price that would be received to sell the property in an orderly transaction between marketplace participants at the measurement date, net of disposal costs. The valuation techniques that the Company used included discounted cash flow analysis, an income capitalization approach on prevailing or earnings multiples applied to earnings from the property, analysis of recent comparable sales transactions, actual sale negotiations and bona fide purchase offers received from third parties and/or consideration of the amount that currently would be required to replace the asset, as adjusted for obsolescence. In general, the Company considers multiple valuation techniques when measuring the fair value of a property, all of which are based on assumptions that are classified within Level 3 of the fair value hierarchy.

Marketing is directly responsible to pay for (i) remediation of environmental contamination it causes and compliance with various environmental laws and regulations as the operator of the Company’s properties, and (ii) known and unknown environmental liabilities allocated to Marketing under the terms of the Marketing Leases and various other agreements with the Company relating to Marketing’s business and the properties it leases from the Company (collectively the “Marketing Environmental Liabilities”). However, the Company continues to have ongoing environmental remediation obligations at one hundred eighty-seven retail sites and for certain pre-existing conditions at six of the terminals the Company leases to Marketing. If Marketing fails to pay the Marketing Environmental Liabilities, the Company may ultimately be responsible to pay directly for Marketing Environmental Liabilities as the property owner. The Company does not maintain pollution legal liability insurance to protect it from potential future claims for Marketing Environmental Liabilities. The Company will be required to accrue for Marketing Environmental Liabilities if the Company determines that it is probable that Marketing will not meet its obligations and the Company can reasonably estimate the amount of the Marketing Environmental Liabilities for which it will be directly responsible to pay, or if the Company’s assumptions regarding the ultimate allocation methods or share of responsibility that it used to allocate environmental liabilities changes. However, the Company continues to believe that it is not probable that Marketing will not pay for substantially all of the Marketing Environmental Liabilities since the Company believes that Lukoil will not allow Marketing to fail to perform its rental, environmental and other obligations under the Marketing Leases. Accordingly, the Company did not accrue for the Marketing Environmental Liabilities as of December 31, 2009 or 2008. Nonetheless, the Company has determined that the aggregate amount of the Marketing Environmental Liabilities (as estimated by the Company) could be material to the Company if it was required to accrue for all of the Marketing Environmental Liabilities in the future since the Company believes that it is reasonably possible that as a result of such accrual, the Company may not be in compliance with the existing financial covenants in its Credit Agreement and its Term Loan Agreement. Such non-compliance could result in an event of default pursuant to each agreement which, if not cured or waived, could result in the acceleration of the Company’s indebtedness under the Credit Agreement and the Term Loan Agreement.

Should the Company’s assessments, assumptions and beliefs prove to be incorrect, including, in particular, the Company’s belief that Lukoil will continue to provide financial support to Marketing, or if circumstances change, the conclusions reached by the Company may change relating to (i) whether any or what combination of the properties subject to the Marketing Leases are likely to be removed from the Marketing Leases, (ii) recoverability of the deferred rent receivable for some or all of the properties subject to the Marketing Leases, (iii) potential impairment of the properties subject to the Marketing Leases and, (iv) Marketing’s ability to pay the Marketing Environmental Liabilities. The Company intends to regularly review its assumptions that affect the accounting for deferred rent receivable; long-lived assets; environmental litigation accruals; environmental remediation liabilities; and related recoveries from state underground storage tank funds. Accordingly, the Company may be required to (i) reserve additional amounts of the deferred rent receivable related to the properties subject to the Marketing Leases, (ii) record an additional impairment charge related to the properties subject to the Marketing Leases, or (iii) accrue for Marketing Environmental Liabilities that the Company believes are allocable to Marketing under the Marketing Leases and various other agreements as a result of the potential or actual modification of the Marketing Leases or other factors, which may result in material adjustments to the amounts recorded for these assets and liabilities, and as a result of which, the Company may not be in compliance with the financial covenants in its Credit Agreement and its Term Loan Agreement.

Although Marketing has made all required monthly rental payments under the Marketing Leases when due through March 2010, the Company cannot provide any assurance that Marketing will continue to meet its rental, environmental or other obligations under the Marketing Leases. In the event that Marketing does not perform its rental, environmental or other obligations under the Marketing Leases; if the Marketing Leases are modified significantly or terminated; if the Company determines that it is probable that Marketing will not meet its rental, environmental or other obligations and the Company accrues for certain of such liabilities; if the Company is unable to promptly re-let or sell the properties upon recapture from the Marketing Leases; or, if the Company changes its assumptions that affect the accounting for rental revenue or Marketing Environmental Liabilities related to the Marketing Leases and various other agreements; the Company’s business, financial condition, revenues, operating expenses, results of operations, liquidity, ability to pay dividends or stock price may be materially adversely affected.

The Company has also agreed to provide limited environmental indemnification to Marketing, capped at $4,250,000, for certain pre-existing conditions at six of the terminals which are owned by the Company and leased to Marketing. Under the agreement, Marketing is required to pay (and has paid) the first $1,500,000 of costs and expenses incurred in connection with remediating any such pre-existing conditions, Marketing and the Company share equally the next $8,500,000 of those costs and expenses and Marketing is obligated to pay all additional costs and expenses over $10,000,000. The Company has accrued $300,000 as of December 31, 2009 and 2008 in connection with this indemnification agreement.

The Company is subject to various legal proceedings and claims which arise in the ordinary course of its business. In addition, the Company has retained responsibility for certain legal proceedings and claims relating to the petroleum marketing business that were identified at the time of the Spin-Off. As of December 31, 2009 and December 31, 2008, the Company had accrued $3,790,000 and $1,671,000, respectively, for certain of these matters which it believes were appropriate based on information then currently available. The Company has not accrued for approximately $950,000 in costs allegedly incurred by the current property owner in connection with removal of USTs and soil remediation at a property that had been leased to and operated by Marketing. The Company believes Marketing is responsible for such costs under the terms of the Master Lease and tendered the matter for defense and indemnification from Marketing, but Marketing denied its liability for the claim and its responsibility to defend against and indemnify the Company for the claim. The Company filed a third party claim against Marketing for indemnification in this matter. The property owner’s claim for reimbursement of costs incurred and our claim for indemnification by Marketing were actively litigated, leading to a trial held before a judge. The trial court issued its decision in August 2009 under which the Company and Marketing were held jointly and severally responsible to the current property owner for the costs incurred by the owner to remove USTs and remediate contamination at the site, but, as between the Company and Marketing, Marketing was accountable for such costs under the indemnification provisions of the Master Lease. The order on the trial court’s decision was entered in February 2010, making such decision final for purposes of initiating the limited period of time following which appeal may be taken. The Company believes that Marketing will appeal the decision; however, the Company believes the probability that Marketing will not be ultimately responsible for the claim for clean-up costs incurred by the current property owner is remote. It is possible that the Company’s assumptions regarding, among other items, the ultimate resolution of and/or the Company’s ultimate share of

responsibility for these matters may change, which may result in the Company providing or adjusting its accruals for these matters.

In September 2003, the Company received a directive (the “Directive”) from the State of New Jersey Department of Environmental Protection (the “NJDEP”) notifying the Company that it is one of approximately sixty-six potentially responsible parties for natural resource damages resulting from discharges of hazardous substances into the Lower Passaic River. The Directive calls for an assessment of the natural resources that have been injured by the discharges into the Lower Passaic River and interim compensatory restoration for the injured natural resources. There has been no material activity with respect to the NJDEP Directive since early after its issuance. The responsibility for the alleged damages, the aggregate cost to remediate the Lower Passaic River, the amount of natural resource damages and the method of allocating such amounts among the potentially responsible parties have not been determined. The Company is a member of a Cooperating Parties Group which has agreed to take over from the United States Environmental Protection Agency (“EPA”) performance of a remedial investigation and feasibility study intended to evaluate alternative remedial actions with respect to alleged damages to the Lower Passaic River. The remedial investigation and feasibility study does not resolve liability issues for remedial work or restoration of, or compensation for, natural resource damages to the Lower Passaic River, which are not known at this time.

In a related action, in December 2005, the State of New Jersey brought suit against certain companies which the State alleges are responsible for pollution of the Passaic River. In February 2009, certain of these defendants filed third-party complaints against approximately three hundred additional parties, including the Company, seeking contribution for a pro-rata share of response costs, cleanup, and other damages. A Special Master has been appointed by the court to try and design an alternative dispute resolution process for achieving a global resolution of this litigation. The Company believes that ChevronTexaco is contractually obligated to indemnify the Company, pursuant to an indemnification agreement, for most if not all of the conditions at the property identified by the NJDEP and the EPA. Accordingly, the ultimate legal and financial liability of the Company, if any, cannot be estimated with any certainty at this time.

As of December 31, 2009, the Company is defending against fifty-three lawsuits brought by or on behalf of private and public water providers and governmental agencies in Connecticut, Florida, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Vermont, Virginia, and West Virginia. These cases allege various theories of liability due to contamination of groundwater with methyl tertiary butyl ether (a fuel derived from methanol, commonly referred to as “MTBE”) as the basis for claims seeking compensatory and punitive damages, and name as defendant approximately fifty petroleum refiners, manufacturers, distributors and retailers of MTBE, or gasoline containing MTBE. Pursuant to consolidation procedures under federal law, most of the MTBE cases originally filed were transferred to the United States District Court for the Southern District of New York for coordinated Multi-District Litigation proceedings. The Company is presently named as a defendant in thirty-nine out of more than one hundred cases that have been consolidated in this Multi-District Litigation, and the Company is also named as a defendant in fourteen related MTBE cases pending in the Supreme Court of New York, Nassau County. A majority of the primary defendants entered into global settlement agreements which settled one hundred two individual cases brought by the same law firm on behalf of various plaintiffs. The Company remains a defendant in twenty-seven of these one hundred two cases. The Company is also a defendant in twenty-five other individual MTBE cases brought by another firm, and it is also a defendant in a final MTBE case in the consolidated Multi-District Litigation brought by the State of New Jersey.

In 2009, the Company provided litigation reserves of $2,300,000 relating to a majority of the MTBE cases pending against it. However, the Company is still unable to estimate its liability for a minority of the cases pending against it. Further, notwithstanding that the Company has provided a litigation reserve as to certain of the MTBE cases, there remains uncertainty as to the accuracy of the allegations in these cases as they relate to it, the Company’s defenses to the claims, its rights to indemnification or contribution from Marketing, and the aggregate possible amount of damages for which the Company may be held liable.

The ultimate resolution of the matters related to the Lower Passaic River and the MTBE multi-district litigation discussed above could cause a material adverse effect on the Company’s business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

Prior to the Spin-Off, the Company was self-insured for workers’ compensation, general liability and vehicle liability up to predetermined amounts above which third-party insurance applies. As of December 31, 2009 and December 31, 2008, the Company’s consolidated balance sheets included, in accounts payable and accrued expenses, $292,000 and $290,000,

respectively, relating to self-insurance obligations. The Company estimates its loss reserves for claims, including claims incurred but not reported, by utilizing actuarial valuations provided annually by its insurance carriers. The Company is required to deposit funds for substantially all of these loss reserves with its insurance carriers, and may be entitled to refunds of amounts previously funded, as the claims are evaluated on an annual basis. The Company’s consolidated statements of operations for the years ended December 31, 2009, 2008 and 2007 include, in general and administrative expenses, a charge of $25,000, a credit of $72,000 and a charge of $81,000, respectively, for self-insurance loss reserve adjustments. Since the Spin-Off, the Company has maintained insurance coverage subject to certain deductibles.

In order to qualify as a REIT, among other items, the Company must distribute at least ninety percent of its “earnings and profits” (as defined in the Internal Revenue Code) to shareholders each year. Should the Internal Revenue Service successfully assert that the Company’s earnings and profits were greater than the amounts distributed, the Company may fail to qualify as a REIT; however, the Company may avoid losing its REIT status by paying a deficiency dividend to eliminate any remaining earnings and profits. The Company may have to borrow money or sell assets to pay such a deficiency dividend.

4. CREDIT AGREEMENT, TERM LOAN AGREEMENT AND INTEREST RATE SWAP AGREEMENT

As of December 31, 2009, borrowings under the Credit Agreement, described below, were $151,200,000, bearing interest at a weighted-average effective rate of 3.0% per annum. The weighted-average effective rate is based on $106,200,000 of LIBOR rate borrowings floating at market rates plus a margin of 1.25% and $45,000,000 of LIBOR rate borrowings effectively fixed at 5.44% by an interest rate Swap Agreement, described below, plus a margin of 1.25%. The Company is a party to a $175,000,000 amended and restated senior unsecured revolving credit agreement (the “Credit Agreement”) with a group of domestic commercial banks led by JPMorgan Chase Bank, N.A. (the “Bank Syndicate”) which expires in March 2011. The Company had $23,800,000 available under the terms of the Credit Agreement as of December 31, 2009. The Credit Agreement does not provide for scheduled reductions in the principal balance prior to its maturity. The Credit Agreement permits borrowings at an interest rate equal to the sum of a base rate plus a margin of 0.0% or 0.25% or a LIBOR rate plus a margin of 1.0%, 1.25% or 1.5%. The applicable margin is based on the Company’s leverage ratio at the end of the prior calendar quarter, as defined in the Credit Agreement, and is adjusted effective mid-quarter when the Company’s quarterly financial results are reported to the Bank Syndicate. Based on the Company’s leverage ratio as of December 31, 2009, the applicable margin will remain at 0.0% for base rate borrowings and 1.25% for LIBOR rate borrowings.

Subject to the terms of the Credit Agreement and continued compliance with the covenants therein, the Company has the option to extend the term of the credit agreement for one additional year to March 2012 and/or, subject to approval by the Bank Syndicate, increase the amount of the credit facility available pursuant to the Credit Agreement by $125,000,000 to $300,000,000. The Company does not expect to exercise its option to increase the amount of the Credit Agreement at this time. In addition, based on the current lack of liquidity in the credit markets, the Company believes that it would need to renegotiate certain terms in the Credit Agreement in order to obtain approval from the Bank Syndicate to increase the amount of the credit facility at this time. No assurance can be given that such approval from the Bank Syndicate will be obtained on terms acceptable to the Company, if at all. The annual commitment fee on the unused Credit Agreement ranges from 0.10% to 0.20% based on the amount of borrowings. The Credit Agreement contains customary terms and conditions, including financial covenants such as those requiring the Company to maintain minimum tangible net worth, leverage ratios and coverage ratios and other covenants which may limit the Company’s ability to incur debt or pay dividends. The Credit Agreement contains customary events of default, including change of control, failure to maintain REIT status or a material adverse effect on the Company’s business, assets, prospects or condition. Any event of default, if not cured or waived, could result in the acceleration of the Company’s indebtedness under the Credit Agreement and could also give rise to an event of default and consequent acceleration of the Company’s indebtedness under its Term Loan Agreement described below.

On September 25, 2009, the Company entered into a $25,000,000 three-year Term Loan Agreement with TD Bank (the “Term Loan Agreement”) which expires in September 2012. As of December 31, 2009, borrowings under the Term Loan Agreement were $24,370,000 bearing interest at a rate of 3.5% per annum. The Term Loan Agreement provides for annual reductions of $780,000 in the principal balance with a $22,160,000 balloon payment due at maturity. The Term Loan Agreement bears interest at a rate equal to a thirty day Libor rate (subject to a floor of 0.4%) plus a margin of 3.1%. The Term Loan Agreement contains customary terms and conditions, including financial covenants such as those requiring the Company to maintain minimum tangible net worth, leverage ratios and coverage ratios and other covenants which may limit the Company’s ability to incur debt or pay dividends. The Term Loan Agreement contains customary events of default,

including change of control, failure to maintain REIT status or a material adverse effect on the Company’s business, assets, prospects or condition. Any event of default, if not cured or waived, could result in the acceleration of the Company’s indebtedness under the Term Loan Agreement and could also give rise to an event of default and consequent acceleration of the Company’s indebtedness under its Credit Agreement.

The aggregate maturities of the Company’s outstanding debt is as follows: 2010 — $780,000, 2011 — $151,980,000, and 2012 — $22,810,000.

The Company is a party to a $45,000,000 LIBOR based interest rate swap, effective through June 30, 2011 (the “Swap Agreement”). The Swap Agreement is intended to effectively fix, at 5.44%, the LIBOR component of the interest rate determined under the Credit Agreement. As a result of the Swap Agreement, as of December 31, 2009, $45,000,000 of the Company’s LIBOR based borrowings under the Credit Agreement bear interest at an effective rate of 6.69%.

The Company entered into the Swap Agreement with JPMorgan Chase Bank, N.A., designated and qualifying as a cash flow hedge, to reduce its exposure to the variability in future cash flows attributable to changes in the LIBOR rate. The Company’s primary objective when undertaking the hedging transaction and derivative position was to reduce its variable interest rate risk by effectively fixing a portion of the interest rate for existing debt and anticipated refinancing transactions. The Company determined, as of the Swap Agreement’s inception and as of December 31 of each year thereafter, that the derivative used in the hedging transaction is highly effective in offsetting changes in cash flows associated with the hedged item and that no gain or loss was required to be recognized in earnings during 2009, 2008 or 2007 representing the hedge’s ineffectiveness. At December 31, 2009 and 2008, the Company’s consolidated balance sheets include, in accounts payable and accrued expenses, an obligation for the fair value of the Swap Agreement of $2,993,000 and $4,296,000, respectively. For the year ended December 31, 2009, 2008 and 2007, the Company has recorded, in accumulated other comprehensive loss in the Company’s consolidated balance sheets, a gain of $1,303,000, a loss of $1,997,000, and a loss of $1,478,000, respectively, from the change in the fair value of the Swap Agreement related to the effective portion of the interest rate contract. The accumulated comprehensive loss of $2,993,000 recorded as of December 31, 2009 will be recognized as an increase in interest expense as quarterly payments are made to the counter-party over the remaining term of the Swap Agreement since it is expected that the Credit Agreement will be refinanced with variable interest rate debt at its maturity.

The fair value of the Swap Agreement was $2,993,000 as of December 31, 2009, determined using (i) a discounted cash flow analysis on the expected cash flows of the Swap Agreement, which is based on market data obtained from sources independent of the Company consisting of interest rates and yield curves that are observable at commonly quoted intervals and are defined by GAAP as “Level 2” inputs in the “Fair Value Hierarchy”, and (ii) credit valuation adjustments, which are based on unobservable “Level 3” inputs. The fair value of the borrowings outstanding under the Credit Agreement was $144,700,000 as of December 31, 2009. The fair value of the borrowings outstanding under the Term Loan Agreement was $24,400,000 as of December 31, 2009. The fair value of the projected average borrowings outstanding under the Credit Agreement and the borrowings outstanding under the Term Loan Agreement were determined using a discounted cash flow technique that incorporates a market interest yield curve, “Level 2 inputs”, with adjustments for duration, optionality, risk profile and projected average borrowings outstanding or borrowings outstanding, which are based on unobservable “Level 3 inputs”. As of December 31, 2009, accordingly, the Company classified its valuation of the Swap Agreement in its entirety within Level 2 of the Fair Value Hierarchy since the credit valuation adjustments are not significant to the overall valuation of the Swap Agreement.

5. ENVIRONMENTAL EXPENSES

The Company is subject to numerous existing federal, state and local laws and regulations, including matters relating to the protection of the environment such as the remediation of known contamination and the retirement and decommissioning or removal of long-lived assets including buildings containing hazardous materials, USTs and other equipment. Environmental expenses are principally attributable to remediation costs which include installing, operating, maintaining and decommissioning remediation systems, monitoring contamination, and governmental agency reporting incurred in connection with contaminated properties. The Company seeks reimbursement from state UST remediation funds related to these environmental expenses where available.

The Company enters into leases and various other agreements which allocate responsibility for known and unknown environmental liabilities by establishing the percentage and method of allocating responsibility between the parties. In accordance with the leases with certain tenants, the Company has agreed to bring the leased properties with known environmental contamination to within applicable standards, and to either regulatory or contractual closure (“Closure”). Generally, upon achieving Closure at each individual property, the Company’s environmental liability under the lease for that property will be satisfied and future remediation obligations will be the responsibility of the Company’s tenant. Generally the liability for the retirement and decommissioning or removal of USTs and other equipment is the responsibility of the Company’s tenants. The Company is contingently liable for these obligations in the event that the tenants do not satisfy their responsibilities. A liability has not been accrued for obligations that are the responsibility of the Company’s tenants based on the tenants’ history of paying such obligations and/or the Company’s assessment of their financial ability to pay their share of such costs. However, there can be no assurance that the Company’s assessments are correct or that the Company’s tenants who have paid their obligations in the past will continue to do so.

Of the eight hundred forty properties leased to Marketing as of December 31, 2009, the Company has agreed to pay all costs relating to, and to indemnify Marketing for, certain environmental liabilities and obligations at one hundred eighty-seven retail properties that have not achieved Closure and are scheduled in the Master Lease. The Company will continue to seek reimbursement from state UST remediation funds related to these environmental expenditures where available.

It is possible that the Company’s assumptions regarding the ultimate allocation method and share of responsibility that it used to allocate environmental liabilities may change, which may result in material adjustments to the amounts recorded for environmental litigation accruals, environmental remediation liabilities and related assets. The Company is required to accrue for environmental liabilities that the Company believes are allocable to others under various other agreements if the Company determines that it is probable that the counter-party will not meet its environmental obligations. The ultimate resolution of these matters could cause a material adverse effect on the Company’s business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. (See note 3 for contingencies related to Marketing and the Marketing Leases for additional information.)

The estimated future costs for known environmental remediation requirements are accrued when it is probable that a liability has been incurred and a reasonable estimate of fair value can be made. The environmental remediation liability is estimated based on the level and impact of contamination at each property. The accrued liability is the aggregate of the best estimate of the fair value of cost for each component of the liability. Recoveries of environmental costs from state UST remediation funds, with respect to both past and future environmental spending, are accrued at fair value as an offset to environmental expense, net of allowance for collection risk, based on estimated recovery rates developed from prior experience with the funds when such recoveries are considered probable.

Environmental exposures are difficult to assess and estimate for numerous reasons, including the extent of contamination, alternative treatment methods that may be applied, location of the property which subjects it to differing local laws and regulations and their interpretations, as well as the time it takes to remediate contamination. In developing the Company’s liability for probable and reasonably estimable environmental remediation costs on a property by property basis, the Company considers among other things, enacted laws and regulations, assessments of contamination and surrounding geology, quality of information available, currently available technologies for treatment, alternative methods of remediation and prior experience. Environmental accruals are based on estimates which are subject to significant change, and are adjusted as the remediation treatment progresses, as circumstances change and as environmental contingencies become more clearly defined and reasonably estimable. As of December 31, 2009, the Company had regulatory approval for remediation action plans in place for two hundred forty-five (95%) of the two hundred fifty-eight properties for which it continues to retain

environmental responsibility and the remaining thirteen properties (5%) remain in the assessment phase. In addition, the Company has nominal post-closure compliance obligations at twenty-two properties where it has received “no further action” letters.

Environmental remediation liabilities and related assets are measured at fair value based on their expected future cash flows which have been adjusted for inflation and discounted to present value. The estimated environmental remediation cost and accretion expense included in environmental expenses in the Company’s consolidated statements of operations aggregated $3,910,000, $4,649,000 and $5,135,000 for 2009, 2008 and 2007, respectively, which amounts were net of changes in estimated recoveries from state UST remediation funds. In addition to estimated environmental remediation costs, environmental expenses also include project management fees, legal fees and provisions for environmental litigation loss reserves.

As of December 31, 2009, 2008, 2007 and 2006, the Company had accrued $16,527,000, $17,660,000, $18,523,000 and $17,201,000, respectively, as management’s best estimate of the fair value of reasonably estimable environmental remediation costs. As of December 31, 2009, 2008, 2007 and 2006, the Company had also recorded $3,882,000, $4,223,000 $4,652,000, and $3,845,000, respectively, as management’s best estimate for recoveries from state UST remediation funds, net of allowance, related to environmental obligations and liabilities. The net environmental liabilities of $13,437,000, $13,871,000 and $13,356,000 as of December 31, 2008, 2007 and 2006, respectively, were subsequently accreted for the change in present value due to the passage of time and, accordingly, $884,000, $956,000 and $974,000 of net accretion expense was recorded for the year ended December 31, 2009, 2008 and 2007, respectively, substantially all of which is included in environmental expenses.

In view of the uncertainties associated with environmental expenditures, contingencies related to Marketing and the Marketing Leases and contingencies related to other parties, however, the Company believes it is possible that the fair value of future actual net expenditures could be substantially higher than amounts currently recorded by the Company. (See note 3 for contingencies related to Marketing and the Marketing Leases for additional information.) Adjustments to accrued liabilities for environmental remediation costs will be reflected in the Company’s financial statements as they become probable and a reasonable estimate of fair value can be made. Future environmental expenses could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price.

6. INCOME TAXES

Net cash paid for income taxes for the years ended December 31, 2009, 2008 and 2007 of $467,000, $708,000 and $488,000, respectively, includes amounts related to state and local income taxes for jurisdictions that do not follow the federal tax rules, which are provided for in rental property expenses in the Company’s consolidated statements of operations.

Earnings and profits (as defined in the Internal Revenue Code) is used to determine the tax attributes of dividends paid to stockholders and will differ from income reported for financial statement purposes due to the effect of items which are reported for income tax purposes in years different from that in which they are recorded for financial statement purposes. Earnings and profits were $47,349,000, $40,906,000 and $41,147,000 for the years ended December 31, 2009, 2008 and 2007, respectively. The federal tax attributes of the common dividends for the years ended December 31, 2009, 2008 and 2007 were: ordinary income of 100.0%, 87.4% and 90.3%; capital gain distributions of 0.0%, 1.2% and 0.0% and non-taxable distributions of 0.0%, 11.4% and 9.7%, respectively.

In order to qualify as a REIT, among other items, the Company must pay out substantially all of its earnings and profits in cash distributions to shareholders each year. Should the Internal Revenue Service successfully assert that the Company’s earnings and profits were greater than the amount distributed, the Company may fail to qualify as a REIT; however, the Company may avoid losing its REIT status by paying a deficiency dividend to eliminate any remaining earnings and profits. The Company may have to borrow money or sell assets to pay such a deficiency dividend. The Company accrues for this and certain other tax matters when appropriate based on information currently available. The accrual for uncertain tax positions is adjusted as circumstances change and as the uncertainties become more clearly defined, such as when audits are settled or exposures expire. Tax returns filed for the years 2006, 2007 and 2008, and tax returns which will be filed for the year ended 2009, remain open to examination by federal and state tax jurisdictions under the respective statute of limitations. In 2006 the Company eliminated the amount it had accrued for uncertain tax positions since the Company believes that the uncertainties

regarding these exposures have been resolved or that it is no longer likely that the exposure will result in a liability upon review. However, the ultimate resolution of these matters may have a significant impact on the results of operations for any single fiscal year or interim period.

7. SHAREHOLDERS’ EQUITY

A summary of the changes in shareholders’ equity for the years ended December 31, 2009, 2008 and 2007 is as follows (in thousands, except per share amounts):


				PAID-IN CAPITAL		DIVIDEND PAID IN EXCESS OF EARNINGS			ACCUMULATED OTHER COMPREHENSIVE LOSS

	COMMON STOCK
	SHARES	AMOUNT										TOTAL

BALANCE, DECEMBER 31, 2006	24,765	$	248	$	258,647	$	(32,499	)	$	(821	)	$	225,575
Net earnings							33,894						33,894
Dividends - $1.85 per share							(45,900	)					(45,900	)
Stock-based compensation					87								87
Net unrealized loss on interest rate swap										(1,478	)		(1,478	)

BALANCE, DECEMBER 31, 2007	24,765		248		258,734		(44,505	)		(2,299	)		212,178
Net earnings							41,810						41,810
Dividends - $1.87 per share							(46,429	)					(46,429	)
Stock-based compensation	1				326								326
Stock options exercised					9								9
Net unrealized loss on interest rate swap										(1,997	)		(1,997	)

BALANCE, DECEMBER 31, 2008	24,766		248		259,069		(49,124	)		(4,296	)		205,897
Net earnings							47,049						47,049
Dividends - $1.89 per share							(46,970	)					(46,970	)
Stock-based compensation					390								390
Net unrealized gain on interest rate swap										1,303			1,303

BALANCE, DECEMBER 31, 2009	24,766	$	248	$	259,459	$	(49,045	)	$	(2,993	)	$	207,669

The Company is authorized to issue 20,000,000 shares of preferred stock, par value $.01 per share, for issuance in series, of which none were issued as of December 31, 2009, 2008, 2007 and 2006.

8. SEVERANCE AGREEMENT AND EMPLOYEE BENEFIT PLANS

General and administrative expenses include a provision of $447,000 recorded in 2007 primarily due to the payment of severance and the accelerated vesting of 14,250 restricted stock units which were unvested and scheduled to vest five years from the date of each grant in conjunction with the resignation of Mr. Andy Smith, the former President and Chief Legal Officer of the Company.

The Company has a retirement and profit sharing plan with deferred 401(k) savings plan provisions (the “Retirement Plan”) for employees meeting certain service requirements and a supplemental plan for executives (the “Supplemental Plan”). Under the terms of these plans, the annual discretionary contributions to the plans are determined by the Compensation Committee of the Board of Directors. Also, under the Retirement Plan, employees may make voluntary contributions and the Company has elected to match an amount equal to fifty percent of such contributions but in no event more than three percent of the employee’s eligible compensation. Under the Supplemental Plan, a participating executive may receive an amount equal to ten percent of eligible compensation, reduced by the amount of any contributions allocated to such executive under the Retirement Plan. Contributions, net of forfeitures, under the retirement plans approximated $159,000, $151,000 and

$100,000 for the years ended December 31, 2009, 2008 and 2007, respectively. These amounts are included in the accompanying consolidated statements of operations.

The Getty Realty Corp. 2004 Omnibus Incentive Compensation Plan (the “2004 Plan”) provides for the grant of restricted stock, restricted stock units, performance awards, dividend equivalents, stock payments and stock awards to all employees and members of the Board of Directors. The 2004 Plan authorizes the Company to grant awards with respect to an aggregate of 1,000,000 shares of common stock through 2014. The aggregate maximum number of shares of common stock that may be subject to awards granted under the 2004 Plan during any calendar year is 80,000.

The Company awarded to employees and directors 23,600, 23,800 and 17,550 restricted stock units (“RSUs”) and dividend equivalents in 2009, 2008 and 2007, respectively. The RSUs are settled subsequent to the termination of employment with the Company. On the settlement date each RSU will have a value equal to one share of common stock and may be settled, at the sole discretion of the Compensation Committee, in cash or by the issuance of one share of common stock. In 2008, the Company settled 1,000 RSUs by issuing 400 shares of common stock with an intrinsic value of $7,000 net of employee tax withholdings and cancelling 600 RSUs that were not vested. In 2007, the Compensation Committee elected to settle 14,250 RSUs in cash for $405,000. The RSUs do not provide voting or other shareholder rights unless and until the RSU is settled for a share of common stock. The 85,600 RSUs outstanding as of December 31, 2009 vest starting one year from the date of grant, on a cumulative basis at the annual rate of twenty percent of the total number of RSUs covered by the award. The dividend equivalents represent the value of the dividends paid per common share multiplied by the number of RSUs covered by the award.

The fair values of the RSUs were determined based on the closing market price of the Company’s stock on the date of grant. The average fair values of the RSUs granted in 2009, 2008, and 2007 were estimated at $16.64, $26.86, and $28.78 per unit on the date of grant with an aggregate fair value estimated at $393,000, $639,000 and $505,000, respectively. The fair value of the grants is recognized as compensation expense ratably over the five year vesting period of the RSUs. As of December 31, 2009, there was $981,000 of total unrecognized compensation cost related to RSUs granted under the 2004 Plan.

The fair value of the 12,400, 7,840 and 19,330 RSUs which vested during the years ended December 31, 2009, 2008 and 2007 was $335,000, $213,000 and $523,000, respectively. The aggregate intrinsic value of the 85,600 outstanding RSUs and the 29,800 vested RSUs as of December 31, 2009 was $2,014,000 and $701,000, respectively. For the years ended December 31, 2009, 2008 and 2007, dividend equivalents aggregating approximately $162,000, $117,000 and $85,000, respectively, were charged against retained earnings when common stock dividends were declared.

The Company has a stock option plan (the “Stock Option Plan”). The Company’s authorization to grant options to purchase shares of the Company’s common stock under the Stock Option Plan expired in January 2008. No options were granted in 2008. Stock options vest starting one year from the date of grant, on a cumulative basis at the annual rate of twenty-five percent of the total number of options covered by the award. As of December 31, 2009, there was $6,000 of unrecognized compensation cost related to non-vested options granted in May 2007 under the Stock Option Plan with an estimated fair value of $18,000, or $3.51 per option. The total fair value of the options vested during the years ended December 31, 2009 and 2008 was $4,000 in each year. As of December 31, 2009, there were 1,750, 10,500 and 5,000 options outstanding which were exercisable at prices of $16.15, $18.30 and $27.68 with a remaining contractual life of two, three and eight years, respectively.

The following is a schedule of stock option prices and activity relating to the Stock Option Plan:


	YEAR ENDED DECEMBER 31,

	2009					2008				2007

	NIMBER OF SHARES	WEIGHTED AVERAGE EXERCISE PRICE		WEIGHTED AVERAGE REMAINING CONTRACTUAL TERM	AGGREGATE INTRINSIC VALUE (IN THOUSANDS)	NUMBER OF SHARES		WEIGHTED AVERAGE EXERCISE PRICE		NUMBER OF SHARES	WEIGHTED AVERAGE EXERXCISE PRICE


Outstanding at beginning of year	17,250	$	20.80			17,750		$	20.73	12,750	$	18.00
Issued	—		—			—			—	5,000		27.68
Exercised (a)	—		—			(500	)		18.30	—		—

Outstanding at end of year	17,250	$	20.80	4.3	68	17,250		$	20.80	17,750	$	20.73

Exercisable at end of Year (b)	14,750		19.63	4.5	68	13,500		$	18.89	12,750	$	18.00


(a)	The total intrinsic value of the options exercised during the year ended December 31, 2008 was $5,000.

(b)	The options vested during the years ended December 31, 2009 and 2008 was 1,250 in each year. No options vested during the year ended December 31, 2007.

9. QUARTERLY FINANCIAL DATA

The following is a summary of the quarterly results of operations for the years ended December 31, 2009 and 2008 (unaudited as to quarterly information) (in thousands, except per share amounts):


	THREE MONTHS ENDED								YEAR ENDED DECEMBER 31,

YEAR ENDED DECEMBER 31, 2009 (a)	MARCH 31,		JUNE 30,		SEPTEMBER 30,		DECEMBER 31,

Revenues from rental properties	$	20,652	$	20,561	$	20,784	$	22,542	$	84,539
Earnings from continuing operations		9,571		10,477		10,638		10,738		41,424
Net earnings		9,928		13,605		12,185		11,331		47,049
Diluted earnings per common share:
Earnings from continuing operations		.39		.42		.43		.43		1.67
Net earnings		.40		.55		.49		.46		1.90

	THREE MONTHS ENDED								YEAR ENDED DECEMBER 31,

YEAR ENDED DECEMBER 31, 2008	MARCH 31,		JUNE 30,		SEPTEMBER 30,		DECEMBER 31,

Revenues from rental properties	$	21,014	$	20,419	$	20,741	$	20,628	$	82,802
Earnings from continuing operations		10,773		9,263		9,919		8,812		38,767
Net earnings		11,371		10,635		10,489		9,315		41,810
Diluted earnings per common share:
Earnings from continuing operations		.43		.37		.40		.36		1.57
Net earnings		.46		.43		.42		.38		1.69

(a) Includes the effect of the $49.0 million acquisition of gasoline stations and convenience store properties from White Oak Petroleum LLC which was completed on September 25, 2009.

10. PROPERTY ACQUISITIONS

In addition to the acquisition of sixty-four properties from Trustreet described in more detail below, in 2007 the Company also exercised its fixed price purchase option for seven leased properties, purchased two properties and redeveloped one property by purchasing land adjacent to it and building a new convenience store on the existing site. In 2008, the Company exercised its fixed price purchase option for three leased properties and purchased six properties. In addition to the acquisition of thirty-six properties from White Oak described in more detail below, in 2009 the Company also exercised its fixed purchase price option for one property and purchased three properties.

Acquisition of sixty-four properties from Trustreet

Effective March 31, 2007, the Company acquired fifty-nine convenience store and retail motor fuel properties in ten states for approximately $79,335,000 from various subsidiaries of FF-TSY Holding Company II, LLC (the successor to Trustreet Properties, Inc.) (“Trustreet”), a subsidiary of General Electric Capital Corporation, for cash with funds drawn under its Credit Agreement. Effective April 23, 2007, the Company acquired five additional properties from Trustreet for approximately $5,200,000. The aggregate cost of the acquisitions, including $1,131,000 of transaction costs, is approximately $84,535,000. Substantially all of the properties are triple-net-leased to tenants who previously leased the properties from the seller. The leases generally provide that the tenants are responsible for substantially all existing and future environmental conditions at the properties. The purchase price has been allocated between assets, liabilities and intangible assets based on the estimates of fair value. The Company estimated the fair value of acquired tangible assets (consisting of land, buildings and improvements) “as if vacant” and identified intangible assets and liabilities (consisting of leasehold interests, above-

market and below-market leases and in-place leases). Based on these estimates, the Company allocated $89,908,000, $5,351,000 and $10,724,000 of the purchase price to acquired tangible assets; identified intangible assets; and identified intangible liabilities, respectively.

The following unaudited pro forma condensed consolidated financial information has been prepared utilizing the historical financial statements of Getty Realty Corp. and the historical financial information of the properties acquired in 2007 which was derived from the consolidated books and records of Trustreet. The unaudited pro forma condensed consolidated financial information assumes that the acquisitions had occurred as of the beginning of 2007, after giving effect to certain adjustments including (a) rental income adjustments resulting from (i) the straight-lining of scheduled rent increases and (ii) the net amortization of the intangible assets relating to above-market leases and intangible liabilities relating to below-market leases over the remaining lease terms which average eleven years and (b) depreciation and amortization adjustments resulting from (i) the depreciation of real estate assets over their useful lives which average seventeen years and (ii) the amortization of intangible assets relating to leases in place over the remaining lease terms. The following unaudited pro forma condensed consolidated financial information also gives effect to the additional interest expense resulting from the assumed increase in borrowing outstanding drawn under the Credit Agreement to fund the acquisition.

The unaudited pro forma condensed financial information the years ended December 31, 2007 is not indicative of the results of operations that would have been achieved had the acquisition from Trustreet reflected herein been consummated at the beginning of 2007 or that will be achieved in the future and is as follows (in thousands, except per share amounts):


Year ended December 31,

	2007


Revenue from rental properties	$	82,089


Net earnings	$	34,348


Basic and diluted net earnings per common share	$	1.39

Acquisition of thirty-six properties from White Oak

On September 25, 2009 the Company acquired the real estate assets and improvements of thirty-six gasoline station and convenience store properties located primarily in Prince George’s County, Maryland, for $49,000,000 in a sale/leaseback transaction with White Oak Petroleum LLC (“White Oak”). The Company financed this transaction with $24,500,000 of borrowings under the Company’s existing Credit Agreement and $24,500,000 of indebtedness under the Term Loan Agreement entered into on that date.

The real estate assets were acquired in a simultaneous transaction among ExxonMobil, White Oak, and the Company, whereby White Oak acquired the real estate assets properties and related businesses from ExxonMobil and simultaneously completed a sale/leaseback of the real estate assets of all thirty-six properties with the Company. The Company entered into a unitary triple-net lease for the real estate assets with White Oak which has an initial term of twenty years and provides White Oak with options for three renewal terms of ten years each extending to 2059. The unitary triple-net lease provides for annual rent escalations of 2½% per year. White Oak is responsible to pay for all existing and future environmental liabilities related to the properties.

The purchase price has been allocated among the assets acquired based on the estimates of fair value. The Company estimated the fair value of acquired tangible assets (consisting of land, buildings and equipment) “as if vacant.” Based on these estimates, the Company allocated $29,929,000 of the purchase price to land, which is accounted for as an operating lease, and $19,071,000 to buildings and equipment, which is accounted for as a direct financing lease.

The following unaudited pro forma condensed consolidated financial information has been prepared utilizing the historical financial statements of Getty Realty Corp. and the effect of additional revenue and expenses from the properties acquired assuming that the acquisitions had occurred as of the beginning of each of the years presented, after giving effect to certain adjustments including (a) rental income adjustments resulting from the straight-lining of scheduled rent increases and

(b) rental income adjustments resulting from the recognition of revenue under direct financing leases over the lease term using the effective interest rate method which produces a constant periodic rate of return on the net investment in the leased property. The following information also gives effect to the additional interest expense resulting from the assumed increase in borrowing outstanding drawn under the Credit Agreement and borrowings outstanding provided by the Term Loan Agreement to fund the acquisition. The unaudited pro forma condensed financial information is not indicative of the results of operations that would have been achieved had the acquisition from White Oak reflected herein been consummated on the dates indicated or that will be achieved in the future. (in thousands)


	Year Ended December 31,

	2009		2008


Revenue from rental properties	$	89,372	$	89,370


Net earnings	$	50,930	$	45,885


Basic and diluted net earnings per common share	$	2.06	$	1.85

The selected financial data of White Oak, LLC as of December 31, 2009 and from its inception on September 26, 2009 through December 31, 2009, which has been prepared by White Oak’s management, is provided below.


(in thousands)

Operating Data (from September 26, 2009 to December 31, 2009:

Gross sales	$	43,171

Gross profit		1,082

Net (loss)		(1,372	)

Balance Sheet Data (at December 31, 2009):

Current assets		1,613

Noncurrent assets		56,666

Current liabilities		5,795

Noncurrent liabilities		53,605

11. SUPPLEMENTAL CONDENSED COMBINING FINANCIAL INFORMATION

Condensed combining financial information as of December 31, 2009 and 2008 and for the three year period ended December 31, 2009 has been derived from the Company’s books and records and is provided below to illustrate, for informational purposes only, the net contribution to the Company’s financial results that are realized from the leasing operations of properties leased to Marketing (which represents approximately 78% of the Company’s properties as of December 31, 2009) and from properties leased to other tenants. The condensed combining financial information set forth below presents the results of operations, net assets, and cash flows of the Company, related to Marketing, the Company’s other tenants and the Company’s corporate functions necessary to arrive at the information for the Company on a combined basis. The assets, liabilities, lease agreements and other leasing operations attributable to the Marketing Leases and other tenant leases are not segregated in legal entities. However, the Company generally maintains its books and records in site specific detail and has classified the operating results which are clearly applicable to each owned or leased property as attributable to Marketing or to the Company’s other tenants or to non-operating corporate functions. The condensed combining financial information has been prepared by the Company using certain assumptions, judgments and allocations. Each of the Company’s properties were classified as attributable to Marketing, other tenants or corporate for all periods presented based on the property’s use as of December 31, 2009 or the property’s use immediately prior to its disposition or third party lease expiration.

Environmental remediation expenses have been attributed to Marketing or other tenants on a site specific basis and environmental related litigation expenses and professional fees have been attributed to Marketing or other tenants based on the pro rata share of specifically identifiable environmental expenses for the three year period ended December 31, 2009. The Company enters into leases and various other agreements which allocate responsibility for known and unknown environmental liabilities by establishing the percentage and method of allocating responsibility between the parties. In accordance with the leases with certain tenants, the Company has agreed to bring the leased properties with known environmental contamination to within applicable standards, and to either regulatory or contractual closure (“Closure”). Generally, upon achieving Closure at each individual property, the Company’s environmental liability under the lease for that property will be satisfied and future remediation obligations will be the responsibility of the Company’s tenant. Of the eight hundred forty properties leased to Marketing as of December 31, 2009, the Company has agreed to pay all costs relating to, and to indemnify Marketing for, certain environmental liabilities and obligations at one hundred eighty-seven retail properties that have not achieved Closure and are scheduled in the Master Lease. (See note 5 for additional information.)

The heading “Corporate” in the statements below includes assets, liabilities, income and expenses attributed to general and administrative functions, financing activities and parent or subsidiary level income taxes, capital taxes or franchise taxes which were not incurred on behalf of the Company’s leasing operations and are not reasonably allocable to Marketing or other tenants. With respect to general and administrative expenses, the Company has attributed those expenses clearly applicable to Marketing and other tenants. The Company considered various methods of allocating to Marketing and other tenants amounts included under the heading “Corporate” and determined that none of the methods resulted in a reasonable allocation of such amounts or an allocation of such amounts that more clearly summarizes the net contribution to the Company’s financial results realized from the leasing operations of properties leased to Marketing and of properties leased to other tenants. Moreover, the Company determined that each of the allocation methods it considered resulted in a presentation of these amounts that would make it more difficult to understand the clearly identifiable results from its leasing operations attributable to Marketing and other tenants. The Company believes that the segregated presentation of assets, liabilities, income and expenses attributed to general and administrative functions, financing activities and parent or subsidiary level income taxes, capital taxes or franchise taxes provides the most meaningful presentation of these amounts since changes in these amounts are not fully correlated to changes in the Company’s leasing activities.

While the Company believes these assumptions, judgments and allocations are reasonable, the condensed combining financial information is not intended to reflect what the net results would have been had assets, liabilities, lease agreements and other operations attributable to Marketing or its other tenants had been conducted through stand-alone entities during any of the periods presented.

The condensed combining statement of operations of Getty Realty Corp. for the year ended December 31, 2009 is as follows (in thousands):


	Getty Petroleum Marketing			Other Tenants			Corporate			Consolidated

Revenues from rental properties	$	59,818		$	24,721		$	—		$	84,539
Operating expenses:
Rental property expenses		(6,297	)		(3,994	)		(560	)		(10,851	)
Impairment charges		(1,135	)		—			—			(1,135	)
Environmental expenses, net		(8,599	)		(200	)		—			(8,799	)
General and administrative expenses		(280	)		(231	)		(6,338	)		(6,849	)
Depreciation and amortization expense		(5,565	)		(5,339	)		(71	)		(10,975	)

Total operating expenses		(21,876	)		(9,764	)		(6,969	)		(38,609	)

Operating income		37,942			14,957			(6,969	)		45,930
Other income, net		154			(13	)		444			585
Interest expense		—			—			(5,091	)		(5,091	)

Earnings from continuing operations		38,096			14,944			(11,616	)		41,424
Discontinued operations:
Earnings from operating activities		209			90			—			299
Gains on dispositions of real estate		4,590			736			—			5,326

Earnings from discontinued operations		4,799			826			—			5,625

Net earnings	$	42,895		$	15,770		$	(11,616	)	$	47,049

The condensed combining statement of operations of Getty Realty Corp. for the year ended December 31, 2008 is as follows (in thousands):


	Getty Petroleum Marketing			Other Tenants			Corporate			Consolidated

Revenues from rental properties	$	60,526		$	22,276		$	—		$	82,802
Operating expenses:
Rental property expenses		(6,937	)		(3,944	)		(601	)		(11,482	)
Environmental expenses, net		(7,152	)		(213	)		—			(7,365	)
General and administrative expenses		(686	)		(193	)		(5,952	)		(6,831	)
Depreciation and amortization expense		(6,743	)		(4,944	)		(39	)		(11,726	)

Total operating expenses		(21,518	)		(9,294	)		(6,592	)		(37,404	)

Operating income		39,008			12,982			(6,952	)		45,398
Other income, net		384			5			14			403
Interest expense		—			—			(7,034	)		(7,034	)

Earnings from continuing operations		39,392			12,987			(13,612	)		38,767
Discontinued operations:
Earnings from operating activities		546			99			—			645
Gains on dispositions of real estate		912			1,486			—			2,398

Earnings from discontinued operations		1,458			1,585			—			3,043

Net earnings	$	40,850		$	14,572		$	(13,612	)	$	41,810

The condensed combining statement of operations of Getty Realty Corp. for the year ended December 31, 2007 is as follows (in thousands):


	Getty Petroleum Marketing			Other Tenants			Corporate			Consolidated

Revenues from rental properties	$	60,464		$	18,743		$	—		$	79,207
Operating expenses:
Rental property expenses		(7,209	)		(3,145	)		(510	)		(10,864	)
Environmental expenses, net		(7,943	)		(246	)		—			(8,189	)
General and administrative expenses		(267	)		(171	)		(6,231	)		(6,669	)
Allowance for deferred rent receivable		(10,206	)		—			—			(10,206	)
Depreciation and amortization expense		(5,287	)		(4,273	)		(40	)		(9,600	)

Total operating expenses		(30,912	)		(7,835	)		(6,781	)		(45,528	)

Operating income		29,552			10,908			(6,781	)		33,679
Other income, net		1,569			45			309			1,923
Interest expense		—			—			(7,760	)		(7,760	)

Earnings from continuing operations		31,121			10,953			(14,232	)		27,842
Discontinued operations:
Earnings from operating activities		1,149			338			—			1,487
Gains on dispositions of real estate		1,479			3,086			—			4,565

Earnings from discontinued operations		2,628			3,424			—			6,052

Net earnings	$	33,749		$	14,377		$	(14,232	)	$	33,894

The condensed combining balance sheet of Getty Realty Corp. as of December 31, 2009 is as follows (in thousands):


	Getty Petroleum Marketing			Other Tenants			Corporate			Consolidated

ASSETS:
Real Estate:
Land	$	137,887		$	114,196		$	—		$	252,083
Buildings and improvements		154,344			97,172			275			251,791

		292,231			211,368			275			503,874

Less — accumulated depreciation and amortization		(116,128	)		(20,386	)		(155	)		(136,669	)

Real estate, net		176,103			190,982			120			367,205
Net investment in direct financing lease		—			19,156			—			19,156
Deferred rent receivable, net		22,801			4,680			—			27,481
Cash and cash equivalents		—			—			3,050			3,050
Recoveries from state underground storage tank funds, net		3,784			98			—			3,882
Mortgages and accounts receivable, net		—			970			1,432			2,402
Prepaid expenses and other assets		—			4,052			5,644			9,696

Total assets		202,688			219,938			10,246			432,872


LIABILITIES:
Borrowings under credit line		—			—			151,200			151,200
Term loan		—			—			24,370			24,370
Environmental remediation costs		16,114			413			—			16,527
Dividends payable		—			—			11,805			11,805
Accounts payable and accrued expenses		920			8,643			11,738			21,301

Total liabilities		17,034			9,056			199,113			225,203


Net assets (liabilities)	$	185,654		$	210,882		$	(188,867	)	$	207,669

The condensed combining balance sheet of Getty Realty Corp. as of December 31, 2008 is as follows (in thousands):


	Getty Petroleum Marketing			Other Tenants			Corporate			Consolidated

ASSETS:
Real Estate:
Land	$	138,886		$	82,654		$	—		$	221,540
Buildings and improvements		157,554			94,060			413			252,027

		296,440			176,714			413			473,567

Less — accumulated depreciation and amortization		(113,122	)		(15,929	)		(271	)		(129,322	)

Real estate, net		183,318			160,785			142			344,245
Deferred rent receivable, net		22,900			3,818			—			26,718
Cash and cash equivalents		—			—			2,178			2,178
Recoveries from state underground storage tank funds, net		4,060			163			—			4,223
Mortgages and accounts receivable, net		7			239			1,287			1,533
Prepaid expenses and other assets		—			4,509			4,407			8,916

Total assets		210,285			169,514			8,014			387,813


LIABILITIES:
Borrowings under credit line		—			—			130,250			130,250
Environmental remediation costs		17,264			396			—			17,660
Dividends payable		—			—			11,669			11,669
Accounts payable and accrued expenses		1,152			9,711			11,474			22,337

Total liabilities		18,416			10,107			153,393			181,916


Net assets (liabilities)	$	191,869		$	159,407		$	(145,379	)	$	205,897

The condensed combining statement of cash flows of Getty Realty Corp. for the year ended December 31, 2009 is as follows (in thousands):


	Getty Petroleum Marketing			Other Tenants			Corporate			Consolidated

CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$	42,895		$	15,770		$	(11,616	)	$	47,049
Adjustments to reconcile net earnings to net cash flow provided by operating activities:
Depreciation and amortization expense		5,607			5,349			71			11,027
Impairment charges		1,135			—			—			1,135
Gain from dispositions of real estate		(4,744	)		(723	)		—			(5,467	)
Deferred rental revenue		99			(862	)		—			(763	)
Amortization of above-market and below-market leases		—			(1,217	)		—			(1,217	)
Amortization of investment in direct financing lease		—			(85	)		—			(85	)
Accretion expense		864			20			—			884
Stock-based employee compensation expense		—			—			390			390
Changes in assets and liabilities:
Recoveries from state underground storage tank funds, net		650			74			—			724
Mortgages and accounts receivable, net		7			(731	)		—			(724	)
Prepaid expenses and other assets		—			(47	)		386			339
Environmental remediation costs		(2,388	)		(12	)		—			(2,400	)
Accounts payable and accrued expenses		(232	)		305			1,567			1,640

Net cash flow provided by (used in) operating activities		43,893			17,841			(9,202	)		52,532


CASH FLOWS FROM INVESTING ACTIVITIES:
Property acquisitions and capital expenditures		(483	)		(54,785	)		(49	)		(55,317	)
Proceeds from dispositions of real estate		5,701			1,238			—			6,939
(Increase) decrease in cash held for property acquisitions		—			—			(1,623	)		(1,623	)
Collection (issuance) of mortgages receivable, net		—			—			(145	)		(145	)

Net cash flow provided by (used in) investing activities		5,218			(53,547	)		(1,817	)		(50,146	)


CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings (repayments) under credit agreement, net		—			—			20,950			20,950
Borrowings under term loan agreement, net		—			—			24,370			24,370
Cash dividends paid		—			—			(46,834	)		(46,834	)
Cash consolidation - Corporate		(49,111	)		35,706			13,405			—

Net cash flow provided by (used in) financing activities		(49,111	)		35,706			11,891			(1,514	)


Net increase in cash and cash equivalents		—			—			872			872
Cash and cash equivalents at beginning of period		—			—			2,178			2,178

Cash and cash equivalents at end of year	$	—		$	—		$	3,050		$	3,050

The condensed combining statement of cash flows of Getty Realty Corp. for the year ended December 31, 2008 is as follows (in thousands):


	Getty Petroleum Marketing			Other Tenants			Corporate			Consolidated

CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$	40,850		$	14,572		$	(13,612	)	$	41,810
Adjustments to reconcile net earnings to net cash flow provided by operating activities:
Depreciation and amortization expense		6,839			4,997			39			11,875
Gain from dispositions of real estate		(1,296	)		(1,491	)		—			(2,787	)
Deferred rental revenue		(539	)		(1,264	)		—			(1,803	)
Amortization of above-market and below-market leases		—			(790	)		—			(790	)
Accretion expense		934			22			—			956
Stock-based employee compensation expense		—			—			326			326
Changes in assets and liabilities:
Recoveries from state underground storage tank funds, net		691			136			—			827
Mortgages and accounts receivable, net		8			(13	)		—			(5	)
Prepaid expenses and other assets		—			12			411			423
Environmental remediation costs		(1,948	)		(269	)		—			(2,217	)
Accounts payable and accrued expenses		(222	)		382			(1,191	)		(1,031	)

Net cash flow provided by (used in) operating activities		45,317			16,294			(14,027	)		47,584


CASH FLOWS FROM INVESTING ACTIVITIES:
Property acquisitions and capital expenditures		(1,233	)		(5,346	)		—			(6,579	)
Proceeds from dispositions of real estate		3,268			2,027			—			5,295
(Increase) decrease in cash held for property acquisitions		—			—			2,397			2,397
Collection (issuance) of mortgages receivable, net		—			—			(55	)		(55	)

Net cash flow provided by (used in) investing activities		2,035			(3,319	)		2,342			1,058


CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings (repayments) under credit agreement, net		—			—			(2,250	)		(2,250	)
Cash dividends paid		—			—			(46,294	)		(46,294	)
Cash paid in settlement of restricted stock units		—			—			9			9
Cash consolidation – Corporate		(47,352	)		(12,975	)		60,327			—

Net cash flow provided by (used in) financing activities		(47,352	)		(12,975	)		11,792			(48,535	)


Net increase in cash and cash equivalents		—			—			107			107
Cash and cash equivalents at beginning of period		—			—			2,071			2,071

Cash and cash equivalents at end of year	$	—		$	—		$	2,178		$	2,178

The condensed combining statement of cash flows of Getty Realty Corp. for the year ended December 31, 2007 is as follows (in thousands):


	Getty Petroleum Marketing			Other Tenants			Corporate			Consolidated

CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$	33,749		$	14,377		$	(14,232	)	$	33,894
Adjustments to reconcile net earnings to net cash flow provided by operating activities:
Depreciation and amortization expense		5,406			4,348			40			9,794
Gain from dispositions of real estate		(3,048	)		(3,131	)		—			(6,179	)
Deferred rental revenue		(1,776	)		(1,336	)		—			(3,112	)
Allowance for deferred rent receivable		10,494			—			—			10,494
Amortization of above-market and below-market leases		—			(1,047	)		—			(1,047	)
Accretion expense		952			22			—			974
Stock-based employee compensation expense		—			—			492			492
Changes in assets and liabilities:
Recoveries from state underground storage tank funds, net		(386	)		7			—			(379	)
Mortgages and accounts receivable, net		(4	)		48			—			44
Prepaid expenses and other assets		—			1,669			(1,799	)		(130	)
Environmental remediation costs		(62	)		(18	)		—			(80	)
Accounts payable and accrued expenses		(59	)		220			(410	)		(249	)

Net cash flow provided by (used in) operating activities		45,266			15,159			(15,909	)		44,516


CASH FLOWS FROM INVESTING ACTIVITIES:
Property acquisitions and capital expenditures		(1,576	)		(89,006	)		(54	)		(90,636	)
Proceeds from dispositions of real estate		3,855			4,565			—			8,420
(Increase) decrease in cash held for property acquisitions		—			—			(2,079	)		(2,079	)
Collection (issuance) of mortgages receivable, net		—			—			267			267

Net cash flow provided by (used in) investing activities		2,279			(84,441	)		(1,866	)		(84,028	)


CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings (repayments) under credit agreement, net		—			—			87,500			87,500
Repayment of mortgages payable, net		—			—			(194	)		(194	)
Cash dividends paid		—			—			(45,650	)		(45,650	)
Credit agreement origination costs		—			—			(863	)		(863	)
Cash paid in settlement of restricted stock units		—			—			(405	)		(405	)
Cash consolidation – Corporate		(47,545	)		69,282			(21,737	)		—

Net cash flow provided by (used in) financing activities		(47,545	)		69,282			18,651			40,388


Net increase in cash and cash equivalents		—			—			876			876
Cash and cash equivalents at beginning of period		—			—			1,195			1,195

Cash and cash equivalents at end of year	$	—		$	—		$	2,071		$	2,071

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Getty Realty Corp.:

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations, comprehensive income and cash flows present fairly, in all material respects, the financial position of Getty Realty Corp. and its subsidiaries at December 31, 2009 and 2008, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2009 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2009, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements and on the Company’s internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ PricewaterhouseCoopers LLP
New York, New York
March 16, 2010

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s reports filed or furnished pursuant to the Exchange Act, of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As required by the Exchange Act Rule 13a-15(b), the Company has carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and the Company’s Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K. Based on the foregoing, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of December 31, 2009.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we have conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our assessment under the framework in Internal Control — Integrated Framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2009.

The effectiveness of our internal control over financial reporting as of December 31, 2009, has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears in “Item 8. Financial Statements and Supplementary Data”.

There have been no changes in the Company’s internal control over financial reporting during the latest fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Item 9B. Other Information

None.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

Information with respect to compliance with section 16(a) of the Exchange Act is incorporated herein by reference to information under the heading “Section 16(a) Beneficial Ownership Reporting Compliance” in the Proxy Statement. Information with respect to directors, the audit committee and the audit committee financial expert, and procedures by which shareholders may recommend to nominees to the board of directors in response to this item is incorporated herein by reference to information under the headings “Election of Directors” and “Directors’ Meetings, Committees and Executive Officers” in the Proxy Statement. The following table lists our executive officers, their respective ages, and the offices and positions held.


NAME	AGE	POSITION	OFFICER SINCE

Leo Liebowitz	82	Chairman and Chief Executive Officer	1971
Kevin C. Shea	50	Executive Vice President	2001
Thomas J. Stirnweis	51	Vice President, Treasurer and Chief Financial Officer	2001
Joshua Dicker	49	Vice President, General Counsel and Secretary	2008

Mr. Liebowitz cofounded the Company in 1955 and has served as Chief Executive Officer since 1985. He was the President of the Company from May 1971 to May 2004. Mr. Liebowitz served as Chairman, Chief Executive Officer and a director of Marketing from October 1996 until December 2000. He is also a director of the Regional Banking Advisory Board of J.P. Morgan Chase & Co. As part of the Company’s management succession process, Mr. Liebowitz will relinquish his position as Chief Executive Officer of the Company at the Company’s 2010 annual stockholder’s meeting, (the “2010 Annual Meeting”) currently scheduled for May 20, 2010. Mr. Liebowitz will continue to serve as Chairman of the Company’s Board of Directors and will retain an active role in the Company through May 2013 at which time he intends to retire.

Mr. David B. Driscoll will be appointed to the position of President of the Company, effective on April 1, 2010. In addition, Mr. Driscoll will be appointed as the Company’s Chief Executive Officer, effective on the date of the 2010 Annual Meeting. Mr. Driscoll currently serves as, and will remain, a Director of the Company. Mr. Driscoll is a Managing Director at Morgan Joseph and Co. Inc. where he was a founding shareholder. Prior to his work at Morgan Joseph, Mr. Driscoll was a Managing Director for ING Barings, where he was Global Coordinator of the real estate practice and prior to ING Barings, Mr. Driscoll was the founder of the real estate group at Smith Barney, which he ran for more than a decade.

Mr. Shea has been with the Company since 1984 and has served as Executive Vice President since May 2004. He was Vice President since January 2001 and Director of National Real Estate Development prior thereto.

Mr. Stirnweis has been with the Company or Getty Petroleum Marketing Inc. since 1988 and has served as Vice President, Treasurer and Chief Financial Officer of the Company since May 2003. He joined the Company in January 2001 as Corporate Controller and Treasurer. Prior to joining the Company, Mr. Stirnweis was Manager of Financial Reporting and Analysis of Marketing.

Mr. Dicker has served as Vice President, General Counsel and Secretary since February 2009. He was General Counsel and Secretary since joining the Company in February 2008. Prior to joining Getty, he was a partner at the law firm Arent Fox, LLP, resident in its New York City office, specializing in corporate and transactional matters.

There are no family relationships between any of the Company’s directors or executive officers.

The Getty Realty Corp. Business Conduct Guidelines (“Code of Ethics”), which applies to all employees, including our chief executive officer and chief financial officer, is available on our website at www.gettyrealty.com.

Item 11. Executive Compensation

Information in response to this item is incorporated herein by reference to information under the heading “Executive Compensation” in the Proxy Statement.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Information in response to this item is incorporated herein by reference to information under the heading “Beneficial Ownership of Capital Stock” and “Executive Compensation — Compensation Discussion and Analysis — Equity Compensation — Equity Compensation Plan Information” in the Proxy Statement.

Item 13. Certain Relationships and Related Transactions, and Director Independence

There were no such relationships or transactions to report for the year ended December 31, 2009.

Information with respect to director independence is incorporated herein by reference to information under the heading “Directors’ Meetings, Committees and Executive Officers — Independence of Directors” in the Proxy Statement.

Item 14. Principal Accountant Fees and Services

Information in response to this item is incorporated herein by reference to information under the heading “Ratification of Appointment of Independent Registered Public Accounting Firm” in the Proxy Statement.

PART IV

Item 15. Exhibits and Financial Statement Schedules


	(a)(1) Financial Statements

	Information in response to this Item is included in “Item 8. Financial Statements and Supplementary Data”.

	(a)(2) Financial Statement Schedules

GETTY REALTY CORP.
INDEX TO FINANCIAL STATEMENT SCHEDULES
Item 15(a)(2)


			PAGES

	Report of Independent Registered Public Accounting Firm on Financial Statement Schedules		85
	Schedule II - Valuation and Qualifying Accounts and Reserves for the years ended December 31, 2009, 2008 and 2007		85
	Schedule III - Real Estate and Accumulated Depreciation and Amortization as of December 31, 2009		86


	(a)(3) Exhibits

	Information in response to this Item is incorporated herein by reference to the Exhibit Index on page 90 of this Annual Report on Form 10-K.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
ON FINANCIAL STATEMENT SCHEDULES

To the Board of Directors of Getty Realty Corp.:

Our audits of the consolidated financial statements and of the effectiveness of internal control over financial reporting referred to in our report dated March 16, 2010 appearing in Item 8 of this Annual Report on Form 10-K also included an audit of the financial statement schedules listed in Item 15(a)(2) of this Form 10-K. In our opinion, these financial statement schedules present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements.

/s/ PricewaterhouseCoopers LLP

New York, New York
March 16, 2010

GETTY REALTY CORP. and SUBSIDIARIES
SCHEDULE II — VALUATION and QUALIFYING ACCOUNTS and RESERVES
for the years ended December 31, 2009, 2008 and 2007
(in thousands)


	BALANCE AT BEGINNING OF YEAR		ADDITIONS		DEDUCTIONS		BALANCE AT END OF YEAR

December 31, 2009:
Allowance for deferred rent receivable	$	10,029	$	—	$	640	$	9,389
Allowance for mortgages and accounts receivable	$	100	$	120	$	85	$	135
Allowance for deposits held in escrow	$	377	$	—	$	—	$	377
Allowance for recoveries from state underground storage tank funds	$	650	$	—	$	—	$	650

December 31, 2008:
Allowance for deferred rent receivable	$	10,494	$	—	$	465	$	10,029
Allowance for mortgages and accounts receivable	$	100	$	71	$	71	$	100
Allowance for deposits held in escrow	$	—	$	377	$	—	$	377
Allowance for recoveries from state underground storage tank funds	$	650	$	—	$	—	$	650

December 31, 2007:
Allowance for deferred rent receivable	$	—	$	10,494	$	—	$	10,494
Allowance for mortgages and accounts receivable	$	30	$	70	$	—	$	100
Allowance for recoveries from state underground storage tank funds	$	650	$	—	$	—	$	650

GETTY REALTY CORP. and SUBSIDIARIES
SCHEDULE III — REAL ESTATE AND ACCUMULATED DEPRECIATION AND AMORTIZATION
As of December 31, 2009
(in thousands)

The summarized changes in real estate assets and accumulated depreciation are as follows:


	2009			2008			2007

Investment in real estate:
Balance at beginning of year	$	473,567		$	474,254		$	383,558
Acquisitions		36,246			6,540			94,700
Capital expenditures		—			—			1,310
Impairment		(1,135	)		—			—
Sales and condemnations		(3,298	)		(3,939	)		(3,464	)
Lease expirations		(1,506	)		(3,288	)		(1,850	)

Balance at end of year	$	503,874		$	473,567		$	474,254


Accumulated depreciation and amortization:
Balance at beginning of year	$	129,322		$	122,465		$	116,089
Depreciation and amortization expense		10,679			11,576			9,448
Sales and condemnations		(1,826	)		(1,431	)		(1,222	)
Lease expirations		(1,506	)		(3,288	)		(1,850	)

Balance at end of year	$	136,669		$	129,322		$	122,465

We are not aware of any material liens or encumbrances on any of our properties.


Description	Initial Cost of Leasehold or Acquisition Investment to Company (1)		Cost Capitalized Subsequent to Initial Investment		Land		Gross Amount at Which Carried at Close of Period Building and Improvements		Total		Accumulated Depreciation		Date of Initial Leasehold or Acquisition Investment (1)

BROOKLYN, NY	$	282,104	$	301,052	$	176,292	$	406,864	$	583,156	$	372,670		1967
JAMAICA, NY		12,000		295,750		12,000		295,750		307,750		220,893		1970
REGO PARK, NY		33,745		281,380		23,000		292,125		315,125		249,086		1974
BROOKLYN, NY		74,808		125,120		30,694		169,234		199,928		165,328		1967
BRONX, NY		60,000		353,955		60,800		353,155		413,955		291,186		1965
CORONA, NY		114,247		300,172		112,800		301,619		414,419		230,641		1965
OCEANSIDE, NY		40,378		169,929		40,000		170,307		210,307		141,447		1970
BLUEPOINT, NY		96,163		118,524		96,068		118,619		214,687		116,418		1972
BRENTWOOD, NY		253,058		84,485		125,000		212,543		337,543		210,879		1968
BAY SHORE, NY		47,685		289,972		0		337,657		337,657		337,232		1969
WHITE PLAINS, NY		0		527,925		302,607		225,318		527,925		127,439		1972
PELHAM MANOR, NY		127,304		85,087		75,800		136,591		212,391		130,613		1972
BRONX, NY		0		309,235		176,558		132,677		309,235		86,961		1971
BRONX, NY		0		293,507		0		293,507		293,507		293,507		1972
BROOKLYN, NY		0		365,767		0		365,767		365,767		364,264		1970
POUGHKEEPSIE, NY		32,885		168,354		35,904		165,335		201,239		160,754		1971
WAPPINGERS FALLS, NY		114,185		159,162		111,785		161,562		273,347		157,257		1971
STONY POINT, NY		59,329		203,448		55,800		206,977		262,777		206,942		1971
KINGSTON, NY		29,010		159,986		12,721		176,275		188,996		174,808		1972
LAGRANGEVILLE, NY		129,133		101,140		64,626		165,647		230,273		164,522		1972
BRONX, NY		128,419		221,197		100,681		248,935		349,616		209,457		1972
STATEN ISLAND, NY		40,598		256,262		26,050		270,810		296,860		213,823		1973
BRONX, NY		141,322		141,909		86,800		196,431		283,231		189,474		1972
NEW YORK, NY		125,923		168,772		78,125		216,570		294,695		214,696		1972
MIDDLE VILLAGE, NY		130,684		73,741		89,960		114,465		204,425		110,305		1972
BROOKLYN, NY		100,000		254,503		66,890		287,613		354,503		251,641		1972
BROOKLYN, NY		135,693		91,946		100,035		127,604		227,639		110,972		1972
BROOKLYN, NY		147,795		228,379		103,815		272,359		376,174		241,697		1972
STATEN ISLAND, NY		101,033		371,591		75,650		396,974		472,624		304,088		1972
STATEN ISLAND, NY		25,000		325,918		0		350,918		350,918		350,918		1972
BRONX, NY		543,833		693,438		473,695		763,576		1,237,271		758,424		1970
BRONX, NY		90,176		183,197		40,176		233,197		273,373		207,493		1976
BRONX, NY		45,044		196,956		10,044		231,956		242,000		209,573		1976
BRONX, NY		128,049		315,917		83,849		360,117		443,966		280,785		1972
BRONX, NY		130,396		184,222		90,396		224,222		314,618		214,621		1972
BRONX, NY		118,025		290,298		73,025		335,298		408,323		294,627		1972
BRONX, NY		70,132		322,265		30,132		362,265		392,397		287,812		1972
BRONX, NY		78,168		450,267		65,680		462,755		528,435		378,580		1972
BRONX, NY		69,150		300,279		34,150		335,279		369,429		273,112		1972
YONKERS, NY		291,348		170,478		216,348		245,478		461,826		231,088		1972
SLEEPY HOLLOW, NY		280,825		102,486		129,744		253,567		383,311		247,803		1969
OLD BRIDGE, NJ		85,617		109,980		56,190		139,407		195,597		139,137		1972
BREWSTER, NY		117,603		78,076		72,403		123,276		195,679		118,832		1972
FLUSHING, NY		118,309		280,435		78,309		320,435		398,744		248,372		1973
BRONX, NY		0		278,517		0		278,517		278,517		243,120		1976
STATEN ISLAND, NY		173,667		133,198		113,369		193,496		306,865		183,514		1976
BRIARCLIFF MANOR, NY		652,213		103,753		501,687		254,279		755,966		244,336		1976
BRONX, NY		95,328		102,639		73,750		124,217		197,967		120,677		1976
BRONX, NY		88,865		193,679		63,315		219,229		282,544		218,236		1976
NEW YORK, NY		106,363		103,035		79,275		130,123		209,398		128,015		1976
NEW YORK, NY		146,159		407,286		43,461		509,984		553,445		410,723		1976
GLENDALE, NY		124,438		287,907		86,160		326,185		412,345		281,583		1976
OZONE PARK, NY		57,289		331,799		44,715		344,373		389,088		299,924		1976
LONG ISLAND CITY, NY		106,592		151,819		73,260		185,151		258,411		169,016		1976
RIDGE, NY		276,942		73,821		200,000		150,763		350,763		132,752		1977
NEW CITY, NY		180,979		100,597		109,025		172,551		281,576		172,312		1978
W. HAVERSTRAW, NY		194,181		38,141		140,000		92,322		232,322		89,998		1978
STATEN ISLAND, NY		0		271,332		0		271,332		271,332		271,334		1978
BROOKLYN, NY		74,928		250,382		44,957		280,353		325,310		222,546		1978
RONKONKOMA, NY		76,478		208,121		46,057		238,542		284,599		234,859		1978
STONY BROOK, NY		175,921		44,529		105,000		115,450		220,450		114,868		1978
MILLER PLACE, NY		110,000		103,160		66,000		147,160		213,160		146,205		1978
LAKE RONKONKOMA, NY		87,097		156,576		51,000		192,673		243,673		191,078		1978
E. PATCHOGUE, NY		57,049		210,390		34,213		233,226		267,439		232,540		1978
AMITYVILLE, NY		70,246		139,953		42,148		168,051		210,199		168,051		1978
BETHPAGE, NY		210,990		38,356		126,000		123,346		249,346		122,985		1978
HUNTINGTON STATION, NY		140,735		52,045		84,000		108,780		192,780		108,702		1978
BALDWIN, NY		101,952		106,328		61,552		146,728		208,280		125,641		1978
ELMONT, NY		388,848		114,933		231,000		272,781		503,781		242,996		1978
NORTH BABYLON, NY		91,888		117,066		59,059		149,895		208,954		148,060		1978
CENTRAL ISLIP, NY		103,183		151,449		61,435		193,197		254,632		193,197		1978
WHITE PLAINS, NY		120,393		67,315		0		187,708		187,708		187,708		1979
STATEN ISLAND, NY		0		222,525		0		222,525		222,525		222,525		1981
BROOKLYN, NY		116,328		232,254		75,000		273,582		348,582		268,060		1980
LONG ISLAND CITY, NY		191,420		390,783		116,554		465,649		582,203		352,385		1981
BAY SHORE, NY		156,382		123,032		85,854		193,560		279,414		191,476		1981
BRISTOL, CT		108,808		81,684		44,000		146,492		190,492		144,412		1982
CROMWELL, CT		70,017		183,119		24,000		229,136		253,136		229,136		1982
EAST HARTFORD, CT		208,004		60,493		84,000		184,497		268,497		184,440		1982
FRANKLIN, CT		50,904		168,470		20,232		199,142		219,374		198,684		1982
MANCHESTER, CT		65,590		156,628		64,750		157,468		222,218		157,082		1982
MERIDEN, CT		207,873		39,829		84,000		163,702		247,702		163,335		1982
NEW MILFORD, CT		113,947		121,174		0		235,121		235,121		233,506		1982
NORWALK, CT		257,308		128,940		104,000		282,248		386,248		281,771		1982
SOUTHINGTON, CT		115,750		158,561		70,750		203,561		274,311		203,086		1982
TERRYVILLE, CT		182,308		98,911		74,000		207,219		281,219		207,115		1982
TOLLAND, CT		107,902		100,178		44,000		164,080		208,080		162,050		1982
WATERFORD, CT		76,981		133,059		0		210,040		210,040		205,914		1982
WEST HAVEN, CT		185,138		48,619		74,000		159,757		233,757		158,374		1982
AGAWAM, MA		65,000		120,665		0		185,665		185,665		184,608		1982
GRANBY, MA		58,804		232,477		24,000		267,281		291,281		217,247		1982
HADLEY, MA		119,276		68,748		36,080		151,944		188,024		148,960		1982
PITTSFIELD, MA		97,153		87,874		40,000		145,027		185,027		145,027		1982
PITTSFIELD, MA		123,167		118,273		50,000		191,440		241,440		190,902		1982
SOUTH HADLEY, MA		232,445		54,351		90,000		196,796		286,796		193,084		1982
SPRINGFIELD, MA		139,373		239,713		50,000		329,086		379,086		260,748		1983
SPRINGFIELD, MA		0		239,087		0		239,087		239,087		194,090		1984
WESTFIELD, MA		123,323		96,093		50,000		169,416		219,416		167,009		1982
OSSINING, NY		140,992		104,761		97,527		148,226		245,753		143,576		1982
FREEHOLD, NJ		494,275		68,507		402,834		159,948		562,782		94,590		1978
HOWELL, NJ		9,750		174,857		0		184,607		184,607		184,257		1978
LAKEWOOD, NJ		130,148		77,265		70,148		137,265		207,413		136,858		1978
NORTH PLAINFIELD, NJ		227,190		239,709		175,000		291,899		466,899		285,546		1978
SOUTH AMBOY, NJ		299,678		94,088		178,950		214,816		393,766		213,777		1978
GLEN HEAD, NY		234,395		192,295		102,645		324,045		426,690		324,045		1982
NEW ROCHELLE, NY		188,932		34,649		103,932		119,649		223,581		119,320		1982
ELMONT, NY		108,348		85,793		64,290		129,851		194,141		100,390		1982
MERIDEN, CT		126,188		106,805		72,344		160,649		232,993		159,095		1982


Description	Initial Cost of Leasehold or Acquisition Investment to Company (1)		Cost Capitalized Subsequent to Initial Investment		Land		Gross Amount at Which Carried at Close of Period Building and Improvements		Total		Accumulated Depreciation		Date of Initial Leasehold or Acquisition Investment (1)

PLAINVILLE, CT	$	80,000	$	290,433	$	0	$	370,433	$	370,433	$	338,333		1983
FRANKLIN SQUARE, NY		152,572		121,756		137,315		137,013		274,328		98,722		1978
SEAFORD, NY		32,000		157,665		0		189,665		189,665		172,250		1978
BROOKLYN, NY		276,831		376,706		168,423		485,114		653,537		377,249		1978
NEW HAVEN, CT		1,412,860		56,420		898,470		570,810		1,469,280		302,425		1985
BRISTOL, CT		359,906		0		0		359,906		359,906		185,954		2004
BRISTOL, CT		1,594,129		0		1,036,184		557,945		1,594,129		115,310		2004
BRISTOL, CT		253,639		0		149,553		104,086		253,639		21,509		2004
BRISTOL, CT		365,028		0		237,268		127,760		365,028		26,402		2004
COBALT, CT		395,683		0		0		395,683		395,683		204,435		2004
DURHAM, CT		993,909		0		0		993,909		993,909		513,520		2004
ELLINGTON, CT		1,294,889		0		841,678		453,211		1,294,889		93,661		2004
ENFIELD, CT		259,881		0		0		259,881		259,881		157,966		2004
FARMINGTON, CT		466,271		0		303,076		163,195		466,271		33,728		2004
HARTFORD, CT		664,966		0		432,228		232,738		664,966		48,102		2004
HARTFORD, CT		570,898		0		371,084		199,814		570,898		41,297		2004
MERIDEN, CT		1,531,772		0		989,165		542,607		1,531,772		115,232		2004
MIDDLETOWN, CT		1,038,592		0		675,085		363,507		1,038,592		75,123		2004
NEW BRITAIN, CT		390,497		0		253,823		136,674		390,497		28,246		2004
NEWINGTON, CT		953,512		0		619,783		333,729		953,512		68,970		2004
NORTH HAVEN, CT		405,389		0		251,985		153,404		405,389		40,249		2004
PLAINVILLE, CT		544,503		0		353,927		190,576		544,503		39,386		2004
PLYMOUTH, CT		930,885		0		605,075		325,810		930,885		67,332		2004
SOUTH WINDHAM, CT		644,141		1,397,938		598,394		1,443,685		2,042,079		144,051		2004
SOUTH WINDSOR, CT		544,857		0		336,737		208,120		544,857		64,274		2004
SUFFIELD, CT		237,401		602,635		200,878		639,158		840,036		232,644		2004
VERNON, CT		1,434,223		0		0		1,434,223		1,434,223		741,014		2004
WALLINGFORD, CT		550,553		0		334,901		215,652		550,553		55,516		2004
WATERBURY, CT		804,040		0		516,387		287,653		804,040		65,095		2004
WATERBURY, CT		515,172		0		334,862		180,310		515,172		37,262		2004
WATERBURY, CT		468,469		0		304,505		163,964		468,469		33,888		2004
WATERTOWN, CT		924,586		0		566,986		357,600		924,586		115,395		2004
WETHERSFIELD, CT		446,610		0		0		446,610		446,610		230,749		2004
WEST HAVEN, CT		1,214,831		0		789,640		425,191		1,214,831		87,875		2004
WESTBROOK, CT		344,881		0		0		344,881		344,881		178,188		2004
WILLIMANTIC, CT		716,782		0		465,908		250,874		716,782		51,848		2004
WINDSOR, CT		1,042,081		0		669,804		372,277		1,042,081		192,345		2004
WINDSOR LOCKS, CT		1,433,330		0		0		1,433,330		1,433,330		740,554		2004
WINDSOR LOCKS, CT		360,664		0		0		360,664		360,664		74,540		2004
BLOOMFIELD, CT		141,452		54,786		90,000		106,238		196,238		103,807		1986
SIMSBURY, CT		317,704		144,637		206,700		255,641		462,341		195,906		1985
RIDGEFIELD, CT		535,140		33,590		347,900		220,830		568,730		122,288		1985
BRIDGEPORT, CT		349,500		56,209		227,600		178,109		405,709		113,357		1985
NORWALK, CT		510,760		209,820		332,200		388,380		720,580		258,459		1985
BRIDGEPORT, CT		313,400		20,303		204,100		129,603		333,703		71,986		1985
STAMFORD, CT		506,860		15,635		329,700		192,795		522,495		99,846		1985
BRIDGEPORT, CT		245,100		20,652		159,600		106,152		265,752		60,930		1985
BRIDGEPORT, CT		313,400		24,314		204,100		133,614		337,714		75,832		1985
BRIDGEPORT, CT		377,600		83,549		245,900		215,249		461,149		146,327		1985
BRIDGEPORT, CT		526,775		63,505		342,700		247,580		590,280		151,300		1985
BRIDGEPORT, CT		338,415		27,786		219,800		146,401		366,201		82,955		1985
NEW HAVEN, CT		538,400		176,230		350,600		364,030		714,630		265,749		1985
DARIEN, CT		667,180		26,061		434,300		258,941		693,241		136,480		1985
WESTPORT, CT		603,260		23,070		392,500		233,830		626,330		120,149		1985
STAMFORD, CT		603,260		112,305		392,500		323,065		715,565		210,644		1985
STAMFORD, CT		506,580		40,429		329,700		217,309		547,009		123,159		1985
STRATFORD, CT		301,300		70,735		196,200		175,835		372,035		120,250		1985
STRATFORD, CT		285,200		14,728		185,700		114,228		299,928		61,763		1985
CHESHIRE, CT		490,200		19,050		319,200		190,050		509,250		100,561		1985
MILFORD, CT		293,512		43,846		191,000		146,358		337,358		90,711		1985
FAIRFIELD, CT		430,000		13,631		280,000		163,631		443,631		83,910		1985
NORWALK, CT		0		619,018		401,996		217,022		619,018		36,230		1988
HARTFORD, CT		233,000		32,563		151,700		113,863		265,563		70,402		1985
NEW HAVEN, CT		217,000		23,889		141,300		99,589		240,889		59,274		1985
RIDGEFIELD, CT		401,630		47,610		166,861		282,379		449,240		277,774		1985
BRIDGEPORT, CT		346,442		16,990		230,000		133,432		363,432		132,159		1985
WILTON, CT		518,881		71,425		337,500		252,806		590,306		154,446		1985
MIDDLETOWN, CT		133,022		86,915		131,312		88,625		219,937		88,625		1987
EAST HARTFORD, CT		555,826		13,797		301,322		268,301		569,623		92,648		1991
WATERTOWN, CT		351,771		58,812		204,027		206,556		410,583		117,379		1992
AVON, CT		730,886		0		402,949		327,937		730,886		111,494		2002
WILMINGTON, DE		309,300		67,834		201,400		175,734		377,134		118,194		1985
ST. GEORGES, DE		442,014		218,906		324,725		336,195		660,920		301,427		1985
WILMINGTON, DE		313,400		103,748		204,100		213,048		417,148		146,061		1985
WILMINGTON, DE		381,700		156,704		248,600		289,804		538,404		196,254		1985
CLAYMONT, DE		237,200		30,878		151,700		116,378		268,078		73,402		1985
NEWARK, DE		405,800		35,844		264,300		177,344		441,644		102,647		1985
WILMINGTON, DE		369,600		38,077		240,700		166,977		407,677		98,578		1985
WILMINGTON, DE		446,000		33,323		290,400		188,923		479,323		107,146		1985
WILMINGTON, DE		337,500		21,971		219,800		139,671		359,471		77,613		1985
LEWISTON, ME		341,900		89,500		222,400		209,000		431,400		146,361		1985
PORTLAND, ME		325,400		42,652		211,900		156,152		368,052		96,727		1985
BIDDEFORD, ME		618,100		8,009		235,000		391,109		626,109		391,109		1985
SACO, ME		204,006		37,173		150,694		90,485		241,179		90,485		1986
SANFORD, ME		265,523		9,178		201,316		73,385		274,701		73,385		1986
WESTBROOK, ME		93,345		193,654		50,431		236,568		286,999		202,561		1986
WISCASSET, ME		156,587		33,455		90,837		99,205		190,042		99,205		1986
SOUTH PORTLAND, ME		180,689		84,980		110,689		154,980		265,669		154,980		1986
LEWISTON, ME		180,338		62,629		101,338		141,629		242,967		140,005		1986
N. WINDHAM, ME		161,365		53,923		86,365		128,923		215,288		128,923		1986
AUGUSTA, ME		482,859		68,242		276,678		274,423		551,101		72,123		1991
BELTSVILLE, MD		1,130,024		0		1,130,024		0		1,130,024		0		2009
BELTSVILLE, MD		730,521		0		730,521		0		730,521		0		2009
BELTSVILLE, MD		525,062		0		525,062		0		525,062		0		2009
BELTSVILLE, MD		1,050,123		0		1,050,123		0		1,050,123		0		2009
BLADENSBURG, MD		570,719		0		570,719		0		570,719		0		2009
BOWIE, MD		1,084,367		0		1,084,367		0		1,084,367		0		2009
CAPITOL HEIGHTS, MD		627,791		0		627,791		0		627,791		0		2009
CLINTON, MD		650,620		0		650,620		0		650,620		0		2009
COLLEGE PARK, MD		536,476		0		536,476		0		536,476		0		2009
COLLEGE PARK, MD		445,161		0		445,161		0		445,161		0		2009
DISTRICT HEIGHTS, MD		479,404		0		479,404		0		479,404		0		2009
DISTRICT HEIGHTS, MD		388,089		0		388,089		0		388,089		0		2009
FORESTVILLE, MD		1,038,709		0		1,038,709		0		1,038,709		0		2009
FORT WASHINGTON, MD		422,332		0		422,332		0		422,332		0		2009
GREENBELT, MD		1,152,853		0		1,152,853		0		1,152,853		0		2009
HYATTSVILLE, MD		490,819		0		490,819		0		490,819		0		2009
HYATTSVILLE, MD		593,548		0		593,548		0		593,548		0		2009
LANDOVER, MD		753,349		0		753,349		0		753,349		0		2009
LANDOVER, MD		662,034		0		662,034		0		662,034		0		2009
LANDOVER HILLS, MD		1,358,312		0		1,358,312		0		1,358,312		0		2009
LANDOVER HILLS, MD		456,575		0		456,575		0		456,575		0		2009
LANHAM, MD		821,836		0		821,836		0		821,836		0		2009
LAUREL, MD		2,522,579		0		2,522,579		0		2,522,579		0		2009
LAUREL, MD		1,415,384		0		1,415,384		0		1,415,384		0		2009
LAUREL, MD		1,529,528		0		1,529,528		0		1,529,528		0		2009


Description	Initial Cost of Leasehold or Acquisition Investment to Company (1)		Cost Capitalized Subsequent to Initial Investment		Land		Gross Amount at Which Carried at Close of Period Building and Improvements		Total		Accumulated Depreciation		Date of Initial Leasehold or Acquisition Investment (1)

LAUREL, MD	$	1,266,997	$	0	$	1,266,997	$	0	$	1,266,997	$	0		2009
LAUREL, MD		1,209,925		0		1,209,925		0		1,209,925		0		2009
LAUREL, MD		696,278		0		696,278		0		696,278		0		2009
OXON HILL, MD		1,255,582		0		1,255,582		0		1,255,582		0		2009
RIVERDALE, MD		787,593		0		787,593		0		787,593		0		2009
RIVERDALE, MD		582,134		0		582,134		0		582,134		0		2009
SEAT PLEASANT, MD		467,990		0		467,990		0		467,990		0		2009
SUITLAND, MD		376,675		0		376,675		0		376,675		0		2009
SUITLAND, MD		673,449		0		673,449		0		673,449		0		2009
TEMPLE HILLS, MD		331,017		0		331,017		0		331,017		0		2009
UPPER MARLBORO, MD		844,665		0		844,665		0		844,665		0		2009
BALTIMORE, MD		429,100		139,393		308,700		259,793		568,493		218,237		1985
RANDALLSTOWN, MD		590,600		33,594		384,600		239,594		624,194		131,788		1985
EMMITSBURG, MD		146,949		73,613		101,949		118,613		220,562		118,455		1986
MILFORD, MA		0		214,331		0		214,331		214,331		192,464		1985
AGAWAM, MA		209,555		63,621		136,000		137,176		273,176		98,617		1985
WESTFIELD, MA		289,580		38,615		188,400		139,795		328,195		86,661		1985
WEST ROXBURY, MA		490,200		23,134		319,200		194,134		513,334		101,899		1985
MAYNARD, MA		735,200		12,714		478,800		269,114		747,914		133,559		1985
GARDNER, MA		1,008,400		73,740		656,700		425,440		1,082,140		234,338		1985
STOUGHTON, MA		775,300		34,554		504,900		304,954		809,854		160,575		1985
ARLINGTON, MA		518,300		27,906		337,500		208,706		546,206		113,941		1985
METHUEN, MA		379,664		64,941		245,900		198,705		444,605		129,287		1985
BELMONT, MA		301,300		27,938		196,200		133,038		329,238		76,538		1985
RANDOLPH, MA		743,200		25,069		484,000		284,269		768,269		147,273		1985
ROCKLAND, MA		534,300		23,616		347,900		210,016		557,916		111,897		1985
WATERTOWN, MA		357,500		296,588		321,030		333,058		654,088		229,910		1985
WEYMOUTH, MA		643,297		36,516		418,600		261,213		679,813		139,635		1985
DEDHAM, MA		225,824		19,150		125,824		119,150		244,974		118,904		1987
HINGHAM, MA		352,606		22,484		242,520		132,570		375,090		131,650		1989
ASHLAND, MA		606,700		17,424		395,100		229,024		624,124		115,358		1985
WOBURN, MA		507,600		294,303		507,600		294,303		801,903		151,857		1985
BELMONT, MA		389,700		28,871		253,800		164,771		418,571		93,523		1985
HYDE PARK, MA		499,175		29,673		321,800		207,048		528,848		116,035		1985
EVERETT, MA		269,500		190,931		269,500		190,931		460,431		115,415		1985
PITTSFIELD, MA		281,200		51,100		183,100		149,200		332,300		149,200		1985
NORTH ATTLEBORO, MA		662,900		16,549		431,700		247,749		679,449		126,177		1985
WORCESTER, MA		497,642		67,806		321,800		243,648		565,448		153,054		1985
NEW BEDFORD, MA		522,300		18,274		340,100		200,474		540,574		104,595		1985
FALL RIVER, MA		859,800		24,423		559,900		324,323		884,223		166,109		1985
WORCESTER, MA		385,600		21,339		251,100		155,839		406,939		84,587		1985
WEBSTER, MA		1,012,400		67,645		659,300		420,745		1,080,045		233,100		1985
CLINTON, MA		586,600		52,725		382,000		257,325		639,325		147,896		1985
FOXBOROUGH, MA		426,593		34,403		325,000		135,996		460,996		131,559		1990
CLINTON, MA		385,600		95,698		251,100		230,198		481,298		157,549		1985
HYANNIS, MA		650,800		42,552		423,800		269,552		693,352		150,756		1985
HOLYOKE, MA		329,500		38,345		214,600		153,245		367,845		153,245		1985
NEWTON, MA		691,000		42,832		450,000		283,832		733,832		152,729		1985
FALMOUTH, MA		519,382		43,841		458,461		104,762		563,223		104,235		1988
METHUEN, MA		490,200		16,282		319,200		187,282		506,482		97,793		1985
ROCKLAND, MA		578,600		185,285		376,800		387,085		763,885		252,606		1985
FAIRHAVEN, MA		725,500		46,752		470,900		301,352		772,252		169,368		1985
BELLINGHAM, MA		734,189		132,725		476,200		390,714		866,914		254,390		1985
NEW BEDFORD, MA		482,275		95,553		293,000		284,828		577,828		198,387		1985
SEEKONK, MA		1,072,700		29,112		698,500		403,312		1,101,812		203,696		1985
WALPOLE, MA		449,900		20,586		293,000		177,486		470,486		92,786		1985
NORTH ANDOVER, MA		393,700		220,132		256,400		357,432		613,832		240,597		1985
LOWELL, MA		360,949		83,674		200,949		243,674		444,623		243,481		1985
AUBURN, MA		175,048		30,890		125,048		80,890		205,938		80,795		1986
METHUEN, MA		147,330		188,059		50,731		284,658		335,389		249,953		1986
IPSWICH, MA		138,918		46,831		95,718		90,031		185,749		88,864		1986
BEVERLY, MA		275,000		150,741		175,000		250,741		425,741		222,188		1986
BILLERICA, MA		400,000		135,809		250,000		285,809		535,809		276,095		1986
HAVERHILL, MA		400,000		17,182		225,000		192,182		417,182		192,094		1986
CHATHAM, MA		275,000		197,302		175,000		297,302		472,302		250,106		1986
HARWICH, MA		225,000		12,044		150,000		87,044		237,044		84,749		1986
IPSWICH, MA		275,000		19,161		150,000		144,161		294,161		142,766		1986
LEOMINSTER, MA		185,040		49,592		85,040		149,592		234,632		147,540		1986
LOWELL, MA		375,000		175,969		250,000		300,969		550,969		254,684		1986
METHUEN, MA		300,000		50,861		150,000		200,861		350,861		199,667		1986
ORLEANS, MA		260,000		37,637		185,000		112,637		297,637		109,463		1986
PEABODY, MA		400,000		200,363		275,000		325,363		600,363		293,518		1986
QUINCY, MA		200,000		36,112		125,000		111,112		236,112		109,724		1986
REVERE, MA		250,000		193,854		150,000		293,854		443,854		263,076		1986
SALEM, MA		275,000		25,393		175,000		125,393		300,393		124,521		1986
TEWKSBURY, MA		125,000		90,338		75,000		140,338		215,338		138,159		1986
FALMOUTH, MA		150,000		322,942		75,000		397,942		472,942		331,983		1986
WEST YARMOUTH, MA		225,000		33,165		125,000		133,165		258,165		132,472		1986
WESTFORD, MA		275,000		196,493		175,000		296,493		471,493		251,058		1986
WOBURN, MA		350,000		45,681		200,000		195,681		395,681		194,547		1986
YARMOUTHPORT, MA		300,000		26,940		150,000		176,940		326,940		176,940		1986
BRIDGEWATER, MA		190,360		36,762		140,000		87,122		227,122		83,296		1987
STOUGHTON, MA		0		235,794		0		235,794		235,794		232,800		1990
WORCESTER, MA		476,102		174,233		309,466		340,869		650,335		340,869		1991
AUBURN, MA		369,306		27,792		240,049		157,049		397,098		60,090		1991
BARRE, MA		535,614		163,028		348,149		350,493		698,642		178,134		1991
WORCESTER, MA		275,866		11,674		179,313		108,227		287,540		37,421		1992
BROCKTON, MA		275,866		194,619		179,313		291,172		470,485		219,607		1991
CLINTON, MA		177,978		29,790		115,686		92,082		207,768		46,403		1992
WORCESTER, MA		167,745		275,852		167,745		275,852		443,597		171,597		1991
DUDLEY, MA		302,563		141,993		196,666		247,890		444,556		124,599		1991
FITCHBURG, MA		247,330		16,384		202,675		61,039		263,714		45,484		1991
FRANKLIN, MA		253,619		18,437		164,852		107,204		272,056		41,534		1988
WORCESTER, MA		342,608		11,101		222,695		131,014		353,709		42,314		1991
HYANNIS, MA		222,472		7,282		144,607		85,147		229,754		28,044		1991
LEOMINSTER, MA		195,776		177,454		127,254		245,976		373,230		162,472		1991
WORCESTER, MA		231,372		157,356		150,392		238,336		388,728		150,160		1991
NORTHBOROUGH, MA		404,900		18,353		263,185		160,068		423,253		54,711		1993
WEST BOYLSTON, MA		311,808		28,937		202,675		138,070		340,745		57,909		1991
WORCESTER, MA		186,877		33,510		121,470		98,917		220,387		50,895		1993
SOUTH YARMOUTH, MA		275,866		49,961		179,313		146,514		325,827		71,099		1991
STERLING, MA		476,102		165,998		309,466		332,634		642,100		173,974		1991
SUTTON, MA		714,159		187,355		464,203		437,311		901,514		220,738		1993
WORCESTER, MA		275,866		150,472		179,313		247,025		426,338		147,677		1991
FRAMINGHAM, MA		297,568		203,147		193,419		307,296		500,715		193,930		1992
UPTON, MA		428,498		24,611		278,524		174,585		453,109		64,071		1991
WESTBOROUGH, MA		311,808		205,994		202,675		315,127		517,802		197,599		1991
HARWICHPORT, MA		382,653		173,989		248,724		307,918		556,642		173,738		1991
WORCESTER, MA		547,283		205,733		355,734		397,282		753,016		215,367		1991
WORCESTER, MA		978,880		191,413		636,272		534,021		1,170,293		242,758		1991
FITCHBURG, MA		390,276		216,589		253,679		353,186		606,865		205,805		1992
WORCESTER, MA		146,832		140,589		95,441		191,980		287,421		125,915		1991
LEICESTER, MA		266,968		197,898		173,529		291,337		464,866		175,087		1991
NORTH GRAFTON, MA		244,720		35,136		159,068		120,788		279,856		56,356		1991
SOUTHBRIDGE, MA		249,169		62,205		161,960		149,414		311,374		84,110		1993
OXFORD, MA		293,664		9,098		190,882		111,880		302,762		36,505		1993


Description	Initial Cost of Leasehold or Acquisition Investment to Company (1)		Cost Capitalized Subsequent to Initial Investment		Land		Gross Amount at Which Carried at Close of Period Building and Improvements		Total		Accumulated Depreciation		Date of Initial Leasehold or Acquisition Investment (1)

WORCESTER, MA	$	284,765	$	45,285	$	185,097	$	144,953	$	330,050	$	71,865		1991
ATHOL, MA		164,629		22,016		107,009		79,636		186,645		36,657		1991
FITCHBURG, MA		142,383		194,291		92,549		244,125		336,674		157,865		1992
WORCESTER, MA		271,417		183,331		176,421		278,327		454,748		171,821		1991
ORANGE, MA		301,102		4,015		75,000		230,117		305,117		230,117		1991
FRAMINGHAM, MA		400,449		22,280		260,294		162,435		422,729		59,478		1991
MILFORD, MA		0		262,436		0		262,436		262,436		216,584		1991
JONESBORO, AR		2,985,267		0		330,322		2,654,945		2,985,267		302,998		2007
BELLFLOWER, CA		1,369,511		0		910,252		459,259		1,369,511		67,741		2007
BENICIA, CA		2,223,362		0		1,057,519		1,165,843		2,223,362		179,594		2007
COACHELLA, CA		2,234,957		0		1,216,646		1,018,312		2,234,957		146,272		2007
EL CAJON, CA		1,292,114		0		779,828		512,286		1,292,114		66,742		2007
FILLMORE, CA		1,354,113		0		950,061		404,052		1,354,113		59,378		2007
HESPERIA, CA		1,643,449		0		849,352		794,097		1,643,449		107,894		2007
LA PALMA, CA		1,971,592		0		1,389,383		582,210		1,971,592		84,221		2007
POWAY, CA		1,439,021		0		0		1,439,021		1,439,021		179,877		2007
SAN DIMAS, CA		1,941,008		0		749,066		1,191,942		1,941,008		148,569		2007
HALEIWA, HI		1,521,648		0		1,058,124		463,524		1,521,648		84,262		2007
HONOLULU, HI		1,538,997		0		1,219,217		319,780		1,538,997		45,501		2007
HONOLULU, HI		1,768,878		0		1,192,216		576,662		1,768,878		75,551		2007
HONOLULU, HI		1,070,141		0		980,680		89,460		1,070,141		19,847		2007
HONOLULU, HI		9,210,707		0		8,193,984		1,016,724		9,210,707		137,758		2007
KANEOHE, HI		1,977,671		0		1,473,275		504,396		1,977,671		74,249		2007
KANEOHE, HI		1,363,901		0		821,691		542,210		1,363,901		82,742		2007
WAIANAE, HI		1,996,811		0		870,775		1,126,036		1,996,811		148,316		2007
WAIANAE, HI		1,520,144		0		648,273		871,871		1,520,144		114,252		2007
WAIPAHU, HI		2,458,592		0		945,327		1,513,264		2,458,592		190,279		2007
COTTAGE HILLS, IL		249,419		0		26,199		223,220		249,419		37,762		2007
FAIRVIEW HEIGHTS, IL		516,564		0		78,440		438,124		516,564		63,912		2007
BALTIMORE, MD		2,258,897		0		721,876		1,537,022		2,258,897		197,323		2007
BALTIMORE, MD		802,414		0		0		802,414		802,414		110,333		2007
ELLICOTT CITY, MD		895,049		0		0		895,049		895,049		129,547		2007
KERNERSVILLE, NC		296,770		0		72,777		223,994		296,770		31,523		2007
KERNERSVILLE, NC		638,633		0		338,386		300,247		638,633		49,401		2007
KERNERSVILLE, NC		608,441		0		250,505		357,936		608,441		56,196		2007
LEXINGTON, NC		204,139		0		43,311		160,828		204,139		27,660		2007
MADISON, NC		420,878		0		45,705		375,174		420,878		54,786		2007
NEW BERN, NC		349,946		0		190,389		159,557		349,946		30,627		2007
TAYLORSVILLE, NC		422,809		0		134,188		288,621		422,809		222,808		2007
WALKERTOWN, NC		844,749		0		488,239		356,509		844,749		62,169		2007
WALNUT COVE, NC		1,140,945		0		513,565		627,380		1,140,945		108,922		2007
WINSTON SALEM, NC		696,397		0		251,987		444,410		696,397		76,494		2007
BELFIELD, ND		1,232,010		0		381,909		850,101		1,232,010		203,453		2007
ALLENSTOWN, NH		1,787,116		0		466,994		1,320,122		1,787,116		188,198		2007
BEDFORD, NH		2,301,297		0		1,271,171		1,030,126		2,301,297		161,736		2007
HOOKSETT, NH		1,561,628		0		823,915		737,712		1,561,628		182,135		2007
AUSTIN, TX		2,368,425		0		738,210		1,630,215		2,368,425		205,486		2007
AUSTIN, TX		462,233		0		274,300		187,933		462,233		33,472		2007
AUSTIN, TX		3,510,062		0		1,594,536		1,915,526		3,510,062		244,250		2007
BEDFORD, TX		353,047		0		112,953		240,094		353,047		45,885		2007
FT WORTH, TX		2,114,924		0		866,062		1,248,863		2,114,924		177,260		2007
HARKER HEIGHTS, TX		2,051,704		0		588,320		1,463,384		2,051,704		302,995		2007
HOUSTON, TX		1,688,904		0		223,664		1,465,240		1,688,904		175,159		2007
KELLER, TX		2,506,573		0		996,029		1,510,544		2,506,573		202,293		2007
LEWISVILLE, TX		493,734		0		109,925		383,809		493,734		42,644		2008
MIDLOTHIAN, TX		429,142		0		71,970		357,172		429,142		58,301		2007
N RICHLAND HILLS, TX		314,246		0		125,745		188,501		314,246		27,981		2007
SAN MARCOS, TX		1,953,653		0		250,739		1,702,914		1,953,653		209,753		2007
TEMPLE, TX		2,405,953		0		1,215,488		1,190,465		2,405,953		163,100		2007
THE COLONY, TX		4,395,696		0		337,083		4,058,613		4,395,696		471,646		2007
WACO, TX		3,884,407		0		894,356		2,990,051		3,884,407		411,823		2007
BROOKLAND, AR		1,467,809		0		149,218		1,318,591		1,467,809		112,884		2007
JONESBORO, AR		868,501		0		173,096		695,405		868,501		62,568		2007
MANCHESTER, NH		261,100		36,404		170,000		127,504		297,504		79,252		1985
DERRY, NH		417,988		16,295		157,988		276,295		434,283		276,083		1987
PLAISTOW, NH		300,406		110,031		244,694		165,743		410,437		165,743		1987
SOMERSWORTH, NH		180,800		60,497		117,700		123,597		241,297		78,667		1985
SALEM, NH		743,200		19,847		484,000		279,047		763,047		141,775		1985
LONDONDERRY, NH		703,100		31,092		457,900		276,292		734,192		146,480		1985
ROCHESTER, NH		939,100		12,337		600,000		351,437		951,437		173,976		1985
HAMPTON, NH		193,103		26,449		135,598		83,954		219,552		83,871		1986
MERRIMACK, NH		151,993		205,823		100,598		257,218		357,816		209,001		1986
NASHUA, NH		197,142		219,639		155,837		260,944		416,781		210,590		1986
PELHAM, NH		169,182		53,497		136,077		86,602		222,679		82,095		1986
PEMBROKE, NH		138,492		174,777		100,837		212,432		313,269		166,808		1986
ROCHESTER, NH		175,188		208,103		95,471		287,820		383,291		244,378		1986
SOMERSWORTH, NH		210,805		15,012		157,520		68,297		225,817		68,251		1986
EXETER, NH		113,285		149,265		65,000		197,550		262,550		192,556		1986
CANDIA, NH		130,000		184,004		80,000		234,004		314,004		231,035		1986
EPPING, NH		170,000		131,403		120,000		181,403		301,403		168,376		1986
EPSOM, NH		220,000		96,022		155,000		161,022		316,022		148,994		1986
MILFORD, NH		190,000		41,689		115,000		116,689		231,689		114,021		1986
PORTSMOUTH, NH		235,000		20,257		150,000		105,257		255,257		105,200		1986
PORTSMOUTH, NH		225,000		228,704		125,000		328,704		453,704		278,025		1986
SALEM, NH		450,000		47,484		350,000		147,484		497,484		143,711		1986
SEABROOK, NH		199,780		19,102		124,780		94,102		218,882		93,917		1986
MCAFEE, NJ		670,900		15,711		436,900		249,711		686,611		126,157		1985
HAMBURG, NJ		598,600		22,121		389,800		230,921		620,721		121,247		1985
WEST MILFORD, NJ		502,200		31,918		327,000		207,118		534,118		115,376		1985
LIVINGSTON, NJ		871,800		30,003		567,700		334,103		901,803		174,067		1985
TRENTON, NJ		373,600		9,572		243,300		139,872		383,172		71,409		1985
WILLINGBORO, NJ		425,800		29,928		277,300		178,428		455,728		100,714		1985
BAYONNE, NJ		341,500		18,947		222,400		138,047		360,447		75,719		1985
CRANFORD, NJ		342,666		29,222		222,400		149,488		371,888		86,426		1985
NUTLEY, NJ		0		512,504		329,248		183,256		512,504		47,504		1986
TRENTON, NJ		466,100		13,987		303,500		176,587		480,087		91,065		1985
WALL TOWNSHIP, NJ		336,441		55,709		121,441		270,709		392,150		268,546		1986
UNION, NJ		490,200		41,361		319,200		212,361		531,561		120,230		1985
CRANBURY, NJ		606,700		31,467		395,100		243,067		638,167		132,331		1985
HILLSIDE, NJ		225,000		31,552		150,000		106,552		256,552		105,855		1987
SPOTSWOOD, NJ		466,675		69,036		303,500		232,211		535,711		146,805		1985
LONG BRANCH, NJ		514,300		22,951		334,900		202,351		537,251		108,466		1985
ELIZABETH, NJ		405,800		18,881		264,300		160,381		424,681		85,530		1985
BELLEVILLE, NJ		397,700		39,410		259,000		178,110		437,110		105,204		1985
NEPTUNE CITY, NJ		269,600		0		175,600		94,000		269,600		44,808		1985
BASKING RIDGE, NJ		362,172		32,960		200,000		195,132		395,132		140,493		1986
DEPTFORD, NJ		281,200		24,745		183,100		122,845		305,945		70,586		1985
CHERRY HILL, NJ		357,500		13,879		232,800		138,579		371,379		72,874		1985
SEWELL, NJ		551,912		48,485		355,712		244,685		600,397		140,704		1985
FLEMINGTON, NJ		546,742		17,494		346,342		217,894		564,236		112,160		1985
BLACKWOOD, NJ		401,700		36,736		261,600		176,836		438,436		103,518		1985
TRENTON, NJ		684,650		33,275		444,800		273,125		717,925		147,862		1985
LODI, NJ		0		1,037,440		587,823		449,617		1,037,440		171,979		1988
EAST ORANGE, NJ		421,508		37,977		272,100		187,385		459,485		110,471		1985
BELMAR, NJ		566,375		24,371		410,800		179,946		590,746		127,114		1985
MOORESTOWN, NJ		470,100		27,064		306,100		191,064		497,164		105,199		1985


Description	Initial Cost of Leasehold or Acquisition Investment to Company (1)		Cost Capitalized Subsequent to Initial Investment		Land		Gross Amount at Which Carried at Close of Period Building and Improvements		Total		Accumulated Depreciation		Date of Initial Leasehold or Acquisition Investment (1)

SPRING LAKE, NJ	$	345,500	$	42,194	$	225,000	$	162,694	$	387,694	$	97,100		1985
HILLTOP, NJ		329,500		16,758		214,600		131,658		346,258		70,806		1985
CLIFTON, NJ		301,518		6,413		150,000		157,931		307,931		113,298		1987
FRANKLIN TWP., NJ		683,000		30,257		444,800		268,457		713,257		143,570		1985
FLEMINGTON, NJ		708,160		33,072		460,500		280,732		741,232		148,630		1985
CLEMENTON, NJ		562,500		27,581		366,300		223,781		590,081		120,759		1985
ASBURY PARK, NJ		418,966		18,038		272,100		164,904		437,004		88,655		1985
MIDLAND PARK, NJ		201,012		4,080		150,000		55,092		205,092		52,999		1989
PATERSON, NJ		619,548		16,765		402,900		233,413		636,313		120,103		1985
OCEAN CITY, NJ		843,700		113,162		549,400		407,462		956,862		253,286		1985
WHITING, NJ		447,199		3,519		167,090		283,628		450,718		283,061		1989
HILLSBOROUGH, NJ		237,122		7,729		100,000		144,851		244,851		73,093		1985
PRINCETON, NJ		703,100		40,615		457,900		285,815		743,715		157,211		1985
NEPTUNE, NJ		455,726		39,090		293,000		201,816		494,816		116,219		1985
NEWARK, NJ		3,086,592		164,432		2,005,800		1,245,224		3,251,024		681,531		1985
OAKHURST, NJ		225,608		46,405		100,608		171,405		272,013		170,936		1985
BELLEVILLE, NJ		215,468		38,163		149,237		104,394		253,631		103,501		1986
PINE HILL, NJ		190,568		39,918		115,568		114,918		230,486		113,625		1986
TUCKERTON, NJ		224,387		132,864		131,018		226,233		357,251		223,797		1987
WEST DEPTFORD, NJ		245,450		50,295		151,053		144,692		295,745		143,527		1987
ATCO, NJ		153,159		85,853		131,766		107,246		239,012		107,246		1987
SOMERVILLE, NJ		252,717		254,230		200,500		306,447		506,947		217,483		1987
CINNAMINSON, NJ		326,501		24,931		176,501		174,931		351,432		173,817		1987
RIDGEFIELD PARK, NJ		273,549		0		150,000		123,549		273,549		95,881		1997
BRICK, NJ		1,507,684		0		1,000,000		507,684		1,507,684		274,351		2000
LAKE HOPATCONG, NJ		1,305,034		0		800,000		505,034		1,305,034		327,094		2000
BERGENFIELD, NJ		381,590		36,271		300,000		117,861		417,861		116,222		1990
ORANGE, NJ		281,200		24,573		183,100		122,673		305,773		71,167		1985
BLOOMFIELD, NJ		695,000		21,021		371,400		344,621		716,021		344,621		1985
UNION, NJ		287,800		0		287,800		0		287,800		0		1985
SCOTCH PLAINS, NJ		331,063		14,455		214,600		130,918		345,518		70,788		1985
NUTLEY, NJ		433,800		48,677		282,500		199,977		482,477		120,394		1985
PLAINFIELD, NJ		470,100		29,975		306,100		193,975		500,075		107,064		1985
MOUNTAINSIDE, NJ		664,100		31,620		431,700		264,020		695,720		140,933		1985
WATCHUNG, NJ		449,900		20,339		293,000		177,239		470,239		94,344		1985
GREEN VILLAGE, NJ		277,900		44,471		127,900		194,471		322,371		192,586		1985
IRVINGTON, NJ		409,700		54,841		266,800		197,741		464,541		122,878		1985
JERSEY CITY, NJ		438,000		51,856		285,200		204,656		489,856		123,893		1985
BLOOMFIELD, NJ		441,900		32,951		287,800		187,051		474,851		106,117		1985
DOVER, NJ		606,700		30,153		395,100		241,753		636,853		130,149		1985
PARLIN, NJ		418,046		29,075		263,946		183,175		447,121		102,345		1985
UNION CITY, NJ		799,500		3,440		520,600		282,340		802,940		136,383		1985
COLONIA, NJ		253,100		3,395		164,800		91,695		256,495		45,486		1985
NORTH BERGEN, NJ		629,527		81,006		409,527		301,006		710,533		184,442		1985
WAYNE, NJ		490,200		21,766		319,200		192,766		511,966		103,277		1985
HASBROUCK HEIGHTS, NJ		639,648		19,648		416,000		243,296		659,296		125,636		1985
COLONIA, NJ		952,200		74,451		620,100		406,551		1,026,651		231,266		1985
OLD BRIDGE, NJ		319,521		24,445		204,621		139,345		343,966		78,953		1985
RIDGEWOOD, NJ		703,100		36,959		457,900		282,159		740,059		151,110		1985
HAWTHORNE, NJ		245,100		10,967		159,600		96,467		256,067		51,723		1985
WAYNE, NJ		474,100		42,926		308,700		208,326		517,026		121,563		1985
WASHINGTON TOWNSHIP, NJ		912,000		21,261		593,900		339,361		933,261		172,441		1985
PARAMUS, NJ		381,700		42,394		248,600		175,494		424,094		105,839		1985
JERSEY CITY, NJ		401,700		43,808		261,600		183,908		445,508		110,590		1985
FORT LEE, NJ		1,245,500		39,408		811,100		473,808		1,284,908		245,685		1985
AUDUBON, NJ		421,800		12,949		274,700		160,049		434,749		82,963		1985
TRENTON, NJ		337,500		69,461		219,800		187,161		406,961		125,353		1985
MAGNOLIA, NJ		329,500		26,488		214,600		141,388		355,988		81,258		1985
BEVERLY, NJ		470,100		24,003		306,100		188,003		494,103		101,231		1985
PISCATAWAY, NJ		269,200		28,232		175,300		122,132		297,432		72,669		1985
WEST ORANGE, NJ		799,500		34,733		520,600		313,633		834,233		167,676		1985
ROCKVILLE CENTRE, NY		350,325		315,779		201,400		464,704		666,104		367,737		1985
GLENDALE, NY		368,625		159,763		235,500		292,888		528,388		194,487		1985
BELLAIRE, NY		329,500		73,358		214,600		188,258		402,858		118,915		1985
BAYSIDE, NY		245,100		202,833		159,600		288,333		447,933		199,525		1985
YONKERS, NY		153,184		67,266		76,592		143,858		220,450		82,504		1987
DOBBS FERRY, NY		670,575		33,706		434,300		269,981		704,281		145,463		1985
NORTH MERRICK, NY		510,350		141,506		332,200		319,656		651,856		195,313		1985
GREAT NECK, NY		500,000		24,468		450,000		74,468		524,468		74,455		1985
GLEN HEAD, NY		462,468		45,355		300,900		206,923		507,823		122,157		1985
GARDEN CITY, NY		361,600		33,774		235,500		159,874		395,374		92,693		1985
HEWLETT, NY		490,200		85,618		319,200		256,618		575,818		136,646		1985
EAST HILLS, NY		241,613		21,070		241,613		21,070		262,683		20,501		1986
YONKERS, NY		111,300		80,000		65,000		126,300		191,300		125,714		1988
LEVITTOWN, NY		502,757		42,113		327,000		217,870		544,870		124,889		1985
LEVITTOWN, NY		546,400		113,057		355,800		303,657		659,457		182,469		1985
ST. ALBANS, NY		329,500		87,250		214,600		202,150		416,750		135,207		1985
RIDGEWOOD, NY		278,372		38,578		250,000		66,950		316,950		30,334		1986
BROOKLYN, NY		626,700		282,677		408,100		501,277		909,377		339,892		1985
BROOKLYN, NY		476,816		272,765		306,100		443,481		749,581		307,713		1985
SEAFORD, NY		325,400		83,257		211,900		196,757		408,657		107,452		1985
BAYSIDE, NY		470,100		246,576		306,100		410,576		716,676		267,004		1985
BAY SHORE, NY		188,900		26,286		123,000		92,186		215,186		56,733		1985
ELMONT, NY		360,056		90,633		224,156		226,533		450,689		125,300		1985
WHITE PLAINS, NY		258,600		60,120		164,800		153,920		318,720		100,798		1985
SCARSDALE, NY		257,100		102,632		167,400		192,332		359,732		132,271		1985
EASTCHESTER, NY		614,700		34,500		400,300		248,900		649,200		135,997		1985
NEW ROCHELLE, NY		337,500		51,741		219,800		169,441		389,241		102,451		1985
BROOKLYN, NY		421,800		270,436		274,700		417,536		692,236		284,431		1985
COMMACK, NY		321,400		25,659		209,300		137,759		347,059		78,952		1985
SAG HARBOR, NY		703,600		36,012		458,200		281,412		739,612		152,932		1985
EAST HAMPTON, NY		659,127		39,313		427,827		270,613		698,440		147,997		1985
MASTIC, NY		313,400		110,180		204,100		219,480		423,580		162,281		1985
BRONX, NY		390,200		329,357		251,100		468,457		719,557		321,137		1985
YONKERS, NY		1,020,400		61,875		664,500		417,775		1,082,275		228,216		1985
GLENVILLE, NY		343,723		98,299		219,800		222,222		442,022		151,393		1985
YONKERS, NY		202,826		42,877		144,000		101,703		245,703		91,641		1986
MINEOLA, NY		341,500		34,411		222,400		153,511		375,911		90,255		1985
ALBANY, NY		404,888		104,378		261,600		247,666		509,266		170,973		1985
LONG ISLAND CITY, NY		1,646,307		259,443		1,071,500		834,250		1,905,750		532,030		1985
RENSSELAER, NY		1,653,500		514,444		1,076,800		1,091,144		2,167,944		789,339		1985
RENSSELAER, NY		683,781		0		286,504		397,277		683,781		108,728		2004
PORT JEFFERSON, NY		387,478		63,743		245,753		205,468		451,221		131,214		1985
SALT POINT, NY		0		554,243		301,775		252,468		554,243		103,331		1987
ROTTERDAM, NY		140,600		100,399		91,600		149,399		240,999		116,342		1985
OSSINING, NY		231,100		44,049		149,200		125,949		275,149		80,070		1985
ELLENVILLE, NY		233,000		53,690		151,700		134,990		286,690		89,625		1985
CHATHAM, NY		349,133		131,805		225,000		255,938		480,938		182,302		1985
HYDE PARK, NY		253,100		12,015		139,100		126,015		265,115		126,015		1985
SHRUB OAK, NY		1,060,700		81,807		690,700		451,807		1,142,507		255,357		1985
NEW YORK, NY		0		229,435		0		229,435		229,435		229,435		1985
BROOKLYN, NY		237,100		125,067		154,400		207,767		362,167		135,688		1985
STATEN ISLAND, NY		301,300		288,603		196,200		393,703		589,903		283,923		1985
STATEN ISLAND, NY		357,904		39,588		230,300		167,192		397,492		101,240		1985
STATEN ISLAND, NY		349,500		176,590		227,600		298,490		526,090		201,804		1985
BRONX, NY		93,817		120,396		67,200		147,013		214,213		130,646		1985


Description	Initial Cost of Leasehold or Acquisition Investment to Company (1)		Cost Capitalized Subsequent to Initial Investment		Land		Gross Amount at Which Carried at Close of Period Building and Improvements		Total		Accumulated Depreciation		Date of Initial Leasehold or Acquisition Investment (1)

BRONX, NY	$	104,130	$	360,410	$	90,000	$	374,540	$	464,540	$	326,249		1985
PELHAM MANOR, NY		136,791		78,987		75,000		140,778		215,778		138,712		1985
EAST MEADOW, NY		425,000		86,005		325,000		186,005		511,005		154,006		1986
STATEN ISLAND, NY		389,700		88,922		253,800		224,822		478,622		152,059		1985
MERRICK, NY		477,498		77,925		240,764		314,659		555,423		157,414		1987
MASSAPEQUA, NY		333,400		53,696		217,100		169,996		387,096		109,017		1985
TROY, NY		225,000		60,569		146,500		139,069		285,569		97,618		1985
BALDWIN, NY		290,923		5,007		151,280		144,650		295,930		86,176		1986
NEW YORK, NY		0		541,637		0		541,637		541,637		477,319		1986
MIDDLETOWN, NY		751,200		166,411		489,200		428,411		917,611		244,445		1985
OCEANSIDE, NY		313,400		88,863		204,100		198,163		402,263		110,920		1985
WANTAGH, NY		261,814		85,758		175,000		172,572		347,572		139,271		1985
NORTHPORT, NY		241,100		33,036		157,000		117,136		274,136		73,013		1985
BALLSTON, NY		160,000		134,021		110,000		184,021		294,021		181,404		1986
BALLSTON SPA, NY		210,000		105,073		100,000		215,073		315,073		211,564		1986
COLONIE, NY		245,150		28,322		120,150		153,322		273,472		150,416		1986
DELMAR, NY		150,000		42,478		70,000		122,478		192,478		119,169		1986
FORT EDWARD, NY		225,000		65,739		150,000		140,739		290,739		140,132		1986
QUEENSBURY, NY		225,000		105,592		165,000		165,592		330,592		164,944		1986
HALFMOON, NY		415,000		205,598		228,100		392,498		620,598		386,836		1986
HANCOCK, NY		100,000		109,470		50,000		159,470		209,470		156,719		1986
HYDE PARK, NY		300,000		59,198		175,000		184,198		359,198		183,391		1986
LATHAM, NY		275,000		68,160		150,000		193,160		343,160		188,752		1986
MALTA, NY		190,000		91,726		65,000		216,726		281,726		211,271		1986
MILLERTON, NY		175,000		123,063		100,000		198,063		298,063		196,919		1986
NEW WINDSOR, NY		150,000		94,791		75,000		169,791		244,791		161,327		1986
NISKAYUNA, NY		425,000		35,421		275,000		185,421		460,421		184,584		1986
PLEASANT VALLEY, NY		398,497		115,129		240,000		273,626		513,626		222,558		1986
QUEENSBURY, NY		215,255		65,245		140,255		140,245		280,500		135,714		1986
ROTTERDAM, NY		132,287		166,077		0		298,364		298,364		258,942		1995
SCHENECTADY, NY		225,000		298,103		150,000		373,103		523,103		369,352		1986
S. GLENS FALLS, NY		325,000		58,892		188,700		195,192		383,892		195,192		1986
ALBANY, NY		206,620		87,949		81,620		212,949		294,569		211,779		1986
NEWBURGH, NY		430,766		25,850		150,000		306,616		456,616		299,080		1989
JERICHO, NY		0		274,779		0		274,779		274,779		155,023		1998
RHINEBECK, NY		203,658		0		101,829		101,829		203,658		16,634		2007
PORT EWEN, NY		657,147		0		176,924		480,223		657,147		83,743		2007
CATSKILL, NY		404,988		0		354,365		50,623		404,988		6,075		2007
CATSKILL, NY		321,446		0		125,000		196,446		321,446		54,588		2004
CATSKILL, NY		104,447		99,076		203,523		0		203,523		0		1989
HUDSON, NY		303,741		126,379		151,871		278,249		430,120		140,534		1989
SAUGERTIES, NY		328,668		63,983		328,668		63,983		392,651		63,845		1988
QUARRYVILLE, NY		35,917		168,199		35,916		168,200		204,116		163,096		1988
MENANDS, NY		150,580		60,563		49,999		161,144		211,143		149,918		1988
BREWSTER, NY		302,564		44,393		142,564		204,393		346,957		201,278		1988
VALATIE, NY		165,590		394,981		90,829		469,742		560,571		439,439		1989
CAIRO, NY		191,928		142,895		46,650		288,173		334,823		280,668		1988
RED HOOK, NY		0		226,787		0		226,787		226,787		222,389		1991
WEST TAGHKANIC, NY		202,750		117,540		121,650		198,640		320,290		138,989		1986
RAVENA, NY		0		199,900		0		199,900		199,900		195,574		1991
SAYVILLE, NY		528,225		0		300,000		228,225		528,225		104,223		1998
WANTAGH, NY		640,680		0		370,200		270,480		640,680		123,516		1998
CENTRAL ISLIP, NY		572,244		0		357,500		214,744		572,244		97,957		1998
FLUSHING, NY		516,110		0		320,125		195,985		516,110		89,328		1998
NORTH LINDENHURST, NY		294,866		0		192,000		102,866		294,866		68,199		1998
WYANDANCH, NY		415,414		0		279,500		135,914		415,414		79,142		1998
NEW ROCHELLE, NY		415,180		0		251,875		163,305		415,180		74,244		1998
FLORAL PARK, NY		616,700		0		356,400		260,300		616,700		118,740		1998
RIVERHEAD, NY		723,346		0		431,700		291,646		723,346		133,040		1998
AMHERST, NY		223,009		0		173,451		49,558		223,009		32,208		2000
BUFFALO, NY		312,426		0		150,888		161,538		312,426		80,252		2000
GRAND ISLAND, NY		350,849		0		247,348		103,501		350,849		60,442		2000
HAMBURG, NY		294,031		0		163,906		130,125		294,031		54,218		2000
LACKAWANNA, NY		250,030		0		129,870		120,160		250,030		61,720		2000
LEWISTON, NY		205,000		0		125,000		80,000		205,000		33,333		2000
TONAWANDA, NY		189,296		0		147,122		42,174		189,296		17,573		2000
TONAWANDA, NY		263,596		11,493		211,337		63,752		275,089		43,718		2000
WEST SENECA, NY		257,142		0		184,385		72,757		257,142		30,322		2000
WILLIAMSVILLE, NY		211,972		0		176,643		35,329		211,972		14,719		2000
ALFRED STATION, NY		714,108		0		414,108		300,000		714,108		46,000		2006
AVOCA, NY		935,543		0		634,543		301,000		935,543		46,000		2006
BATAVIA, NY		684,279		0		364,279		320,000		684,279		49,067		2006
BYRON, NY		969,117		0		669,117		300,000		969,117		46,000		2006
CASTILE, NY		307,196		0		132,196		175,000		307,196		26,833		2006
CHURCHVILLE, NY		1,011,381		0		601,381		410,000		1,011,381		62,867		2006
EAST PEMBROKE, NY		787,465		0		537,465		250,000		787,465		38,333		2006
FRIENDSHIP, NY		392,517		0		42,517		350,000		392,517		53,667		2006
NAPLES, NY		1,257,487		0		827,487		430,000		1,257,487		65,933		2006
ROCHESTER, NY		559,049		0		159,049		400,000		559,049		61,333		2006
PERRY, NY		1,443,847		0		1,043,847		400,000		1,443,847		61,333		2006
PRATTSBURG, NY		553,136		0		303,136		250,000		553,136		38,333		2006
SAVONA, NY		1,314,135		0		964,136		349,999		1,314,135		53,667		2006
WARSAW, NY		990,259		0		690,259		300,000		990,259		46,000		2006
WELLSVILLE, NY		247,281		0		0		247,281		247,281		37,916		2006
ROCHESTER, NY		823,031		0		273,031		550,000		823,031		84,757		2006
LAKEVILLE, NY		1,027,783		0		202,857		824,926		1,027,783		91,323		2008
GREIGSVILLE, NY		1,017,739		0		202,873		814,866		1,017,739		89,426		2008
ROCHESTER, NY		595,237		0		305,237		290,000		595,237		22,893		2008
PHILADELPHIA, PA		687,000		25,017		447,400		264,617		712,017		137,446		1985
PHILADELPHIA, PA		237,100		205,495		154,400		288,195		442,595		196,645		1985
ALLENTOWN, PA		357,500		76,385		232,800		201,085		433,885		119,084		1985
NORRISTOWN, PA		241,300		78,419		157,100		162,619		319,719		97,709		1985
BRYN MAWR, PA		221,000		59,832		143,900		136,932		280,832		93,668		1985
CONSHOHOCKEN, PA		261,100		77,885		170,000		168,985		338,985		116,737		1985
PHILADELPHIA, PA		281,200		34,285		183,100		132,385		315,485		79,638		1985
HUNTINGDON VALLEY, PA		421,800		36,439		274,700		183,539		458,239		105,807		1985
FEASTERVILLE, PA		510,200		160,144		332,200		338,144		670,344		226,939		1985
PHILADELPHIA, PA		285,200		65,498		185,700		164,998		350,698		112,381		1985
PHILADELPHIA, PA		289,300		50,010		188,400		150,910		339,310		96,859		1985
PHILADELPHIA, PA		405,800		221,269		264,300		362,769		627,069		255,105		1985
PHILADELPHIA, PA		417,800		210,406		272,100		356,106		628,206		227,069		1985
PHILADELPHIA, PA		369,600		276,720		240,700		405,620		646,320		292,790		1985
HATBORO, PA		285,200		61,979		185,700		161,479		347,179		108,598		1985
HAVERTOWN, PA		402,000		22,660		253,800		170,860		424,660		99,740		1985
MEDIA, PA		326,195		24,082		191,000		159,277		350,277		105,741		1985
PHILADELPHIA, PA		389,700		28,006		253,800		163,906		417,706		92,695		1985
PHILADELPHIA, PA		341,500		224,647		222,400		343,747		566,147		228,179		1985
ALDAN, PA		281,200		45,539		183,100		143,639		326,739		88,918		1985
BRISTOL, PA		430,500		82,981		280,000		233,481		513,481		154,868		1985
TREVOSE, PA		215,214		16,382		150,000		81,596		231,596		76,096		1987
HAVERTOWN, PA		265,200		24,500		172,700		117,000		289,700		66,918		1985
ABINGTON, PA		309,300		43,696		201,400		151,596		352,996		94,716		1985
HATBORO, PA		289,300		61,371		188,400		162,271		350,671		108,669		1985
CLIFTON HGTS., PA		428,201		63,403		256,400		235,204		491,604		161,928		1985
ALDAN, PA		433,800		21,152		282,500		172,452		454,952		92,653		1985
SHARON HILL, PA		411,057		39,574		266,800		183,831		450,631		108,981		1985


Description	Initial Cost of Leasehold or Acquisition Investment to Company (1)		Cost Capitalized Subsequent to Initial Investment		Land		Gross Amount at Which Carried at Close of Period Building and Improvements		Total		Accumulated Depreciation		Date of Initial Leasehold or Acquisition Investment (1)

MEDIA, PA	$	474,100	$	5,055	$	308,700	$	170,455	$	479,155	$	83,897		1985
ROSLYN, PA		349,500		173,661		227,600		295,561		523,161		227,969		1985
CLIFTON HGTS, PA		213,000		46,824		138,700		121,124		259,824		81,437		1985
PHILADELPHIA, PA		369,600		273,642		240,700		402,542		643,242		306,174		1985
MORRISVILLE, PA		377,600		33,522		245,900		165,222		411,122		95,906		1985
PHILADELPHIA, PA		302,999		220,313		181,497		341,815		523,312		293,393		1985
PHOENIXVILLE, PA		413,800		17,561		269,500		161,861		431,361		86,345		1985
LANGHORNE, PA		122,202		69,328		50,000		141,530		191,530		99,333		1987
POTTSTOWN, PA		430,000		48,854		280,000		198,854		478,854		120,210		1985
BOYERTOWN, PA		233,000		5,373		151,700		86,673		238,373		44,127		1985
QUAKERTOWN, PA		379,111		89,812		243,300		225,623		468,923		157,434		1985
SOUDERTON, PA		381,700		172,170		248,600		305,270		553,870		206,609		1985
LANSDALE, PA		243,844		200,458		243,844		200,458		444,302		124,383		1985
FURLONG, PA		175,300		151,150		175,300		151,150		326,450		101,322		1985
DOYLESTOWN, PA		405,800		32,659		264,300		174,159		438,459		99,328		1985
NORRISTOWN, PA		175,300		120,786		175,300		120,786		296,086		70,702		1985
TRAPPE, PA		377,600		44,509		245,900		176,209		422,109		107,287		1985
GETTYSBURG, PA		157,602		28,530		67,602		118,530		186,132		118,167		1986
PARADISE, PA		132,295		151,188		102,295		181,188		283,483		181,188		1986
LINWOOD, PA		171,518		22,371		102,968		90,921		193,889		90,076		1987
READING, PA		750,000		49,125		0		799,125		799,125		792,720		1989
ELKINS PARK, PA		275,171		17,524		200,000		92,695		292,695		91,588		1990
NEW OXFORD, PA		1,044,707		13,500		18,687		1,039,520		1,058,207		844,811		1996
GLEN ROCK, PA		20,442		166,633		20,442		166,633		187,075		149,023		1961
PHILADELPHIA, PA		1,251,534		0		813,997		437,537		1,251,534		3,222		2009
NORTH KINGSTOWN, RI		211,835		25,971		89,135		148,671		237,806		148,205		1985
MIDDLETOWN, RI		306,710		16,364		176,710		146,364		323,074		145,626		1987
WARWICK, RI		376,563		39,933		205,889		210,607		416,496		209,088		1989
PROVIDENCE, RI		231,372		191,647		150,392		272,627		423,019		154,654		1991
EAST PROVIDENCE, RI		2,297,435		568,241		1,495,700		1,369,976		2,865,676		741,895		1985
ASHAWAY, RI		618,609		0		402,096		216,513		618,609		44,749		2004
EAST PROVIDENCE, RI		309,950		49,546		202,050		157,446		359,496		99,250		1985
PAWTUCKET, RI		212,775		161,188		118,860		255,103		373,963		240,898		1986
WARWICK, RI		434,752		24,730		266,800		192,682		459,482		117,853		1985
CRANSTON, RI		466,100		12,576		303,500		175,176		478,676		89,783		1985
PAWTUCKET, RI		207,100		2,990		154,400		55,690		210,090		42,411		1985
BARRINGTON, RI		490,200		213,866		319,200		384,866		704,066		284,432		1985
WARWICK, RI		253,100		34,400		164,800		122,700		287,500		74,839		1985
N. PROVIDENCE, RI		542,400		61,717		353,200		250,917		604,117		151,534		1985
EAST PROVIDENCE, RI		486,675		13,947		316,600		184,022		500,622		94,998		1985
WAKEFIELD, RI		413,800		39,616		269,500		183,916		453,416		102,217		1985
EPHRATA, PA		183,477		96,937		136,809		143,605		280,414		143,596		1990
DOUGLASSVILLE, PA		178,488		23,321		128,738		73,071		201,809		73,071		1990
POTTSVILLE, PA		162,402		82,769		43,471		201,700		245,171		192,417		1990
POTTSVILLE, PA		451,360		19,361		147,740		322,981		470,721		317,280		1990
LANCASTER, PA		208,677		24,347		78,254		154,770		233,024		154,770		1989
BETHLEHEM, PA		208,677		42,927		130,423		121,181		251,604		121,181		1989
LANCASTER, PA		642,000		17,993		300,000		359,993		659,993		359,993		1989
HAMBURG, PA		219,280		75,745		130,423		164,602		295,025		164,602		1989
READING, PA		182,592		82,812		104,338		161,066		265,404		147,623		1989
MOUNTVILLE, PA		195,635		19,506		78,254		136,887		215,141		136,887		1989
EBENEZER, PA		147,058		88,474		68,804		166,728		235,532		148,286		1989
INTERCOURSE, PA		311,503		81,287		157,801		234,989		392,790		115,614		1989
REINHOLDS, PA		176,520		83,686		82,017		178,189		260,206		165,976		1989
COLUMBIA, PA		225,906		13,206		75,000		164,112		239,112		144,883		1989
OXFORD, PA		191,449		118,321		65,212		244,558		309,770		223,504		1989
EPHRATA, PA		208,604		52,826		30,000		231,430		261,430		179,819		1989
ROBESONIA, PA		225,913		102,802		70,000		258,715		328,715		243,959		1989
KENHORST, PA		143,466		94,592		65,212		172,846		238,058		172,846		1989
NEFFSVILLE, PA		234,761		45,637		91,296		189,102		280,398		186,954		1989
LEOLA, PA		262,890		102,007		131,189		233,708		364,897		131,417		1989
EPHRATA, PA		187,843		9,400		65,212		132,031		197,243		131,262		1989
RED LION, PA		221,719		29,788		52,169		199,338		251,507		199,338		1989
READING, PA		129,284		137,863		65,352		201,795		267,147		174,658		1989
ROTHSVILLE, PA		169,550		25,188		52,169		142,569		194,738		142,569		1989
HANOVER, PA		231,028		13,252		70,000		174,280		244,280		159,496		1989
HARRISBURG, PA		399,016		347,590		198,740		547,866		746,606		360,151		1989
ADAMSTOWN, PA		213,424		108,844		100,000		222,268		322,268		178,442		1989
LANCASTER, PA		308,964		83,443		104,338		288,069		392,407		274,570		1989
NEW HOLLAND, PA		313,015		106,839		143,465		276,389		419,854		256,032		1989
CHRISTIANA, PA		182,593		11,178		65,212		128,559		193,771		128,559		1989
WYOMISSING HILLS, PA		319,320		113,176		76,074		356,422		432,496		356,422		1989
LAURELDALE, PA		262,079		15,550		86,941		190,688		277,629		189,150		1989
REIFFTON, PA		338,250		5,295		43,470		300,075		343,545		300,075		1989
W.READING, PA		790,432		68,726		387,641		471,517		859,158		470,893		1989
ARENDTSVILLE, PA		173,759		101,020		32,603		242,176		274,779		222,873		1989
MOHNTON, PA		317,228		56,374		66,425		307,177		373,602		294,203		1989
MCCONNELLSBURG, PA		155,367		145,616		69,915		231,068		300,983		141,305		1989
CRESTLINE, OH		1,201,523		0		284,761		916,762		1,201,523		56,833		2008
MANSFIELD, OH		921,108		0		331,599		589,509		921,108		34,311		2008
MANSFIELD, OH		1,950,000		0		700,000		1,250,000		1,950,000		54,083		2009
MONROEVILLE, OH		2,580,000		0		485,000		2,095,000		2,580,000		42,772		2009
ROANOKE, VA		91,281		150,495		0		241,776		241,776		241,778		1990
RICHMOND, VA		120,818		167,895		0		288,713		288,713		288,713		1990
CHESAPEAKE, VA		1,184,759		32,132		604,983		611,908		1,216,891		161,615		1990
PORTSMOUTH, VA		562,255		17,106		221,610		357,751		579,361		354,410		1990
NORFOLK, VA		534,910		6,050		310,630		230,330		540,960		230,330		1990
ASHLAND, VA		839,997		0		839,997		0		839,997		0		2005
FARMVILLE, VA		1,226,505		0		621,505		605,000		1,226,505		114,950		2005
FREDERICKSBURG, VA		1,279,280		0		469,280		810,000		1,279,280		153,900		2005
FREDERICKSBURG, VA		1,715,914		0		995,914		720,000		1,715,914		136,800		2005
FREDERICKSBURG, VA		1,289,425		0		798,444		490,981		1,289,425		112,657		2005
FREDERICKSBURG, VA		3,623,228		0		2,828,228		795,000		3,623,228		151,050		2005
GLEN ALLEN, VA		1,036,585		0		411,585		625,000		1,036,585		118,750		2005
GLEN ALLEN, VA		1,077,402		0		322,402		755,000		1,077,402		143,450		2005
KING GEORGE, VA		293,638		0		293,638		0		293,638		0		2005
KING WILLIAM, VA		1,687,540		0		1,067,540		620,000		1,687,540		117,800		2005
MECHANICSVILLE, VA		1,124,769		0		504,769		620,000		1,124,769		117,800		2005
MECHANICSVILLE, VA		902,892		0		272,892		630,000		902,892		119,700		2005
MECHANICSVILLE, VA		1,476,043		0		876,043		600,000		1,476,043		114,000		2005
MECHANICSVILLE, VA		957,418		0		324,158		633,260		957,418		159,410		2005
MECHANICSVILLE, VA		193,088		0		193,088		0		193,088		0		2005
MECHANICSVILLE, VA		1,677,065		0		1,157,065		520,000		1,677,065		98,800		2005
MECHANICSVILLE, VA		1,042,870		0		222,870		820,000		1,042,870		155,800		2005
MONTPELIER, VA		2,480,686		0		1,725,686		755,000		2,480,686		143,450		2005
PETERSBURG, VA		1,441,374		0		816,374		625,000		1,441,374		118,750		2005
RICHMOND, VA		1,131,878		0		546,878		585,000		1,131,878		111,150		2005
RUTHER GLEN, VA		466,341		0		31,341		435,000		466,341		82,650		2005
SANDSTON, VA		721,651		0		101,651		620,000		721,651		117,800		2005
SPOTSYLVANIA, VA		1,290,239		0		490,239		800,000		1,290,239		152,000		2005
CHESAPEAKE, VA		1,026,115		7,149		407,026		626,238		1,033,264		624,922		1990
BENNINGTON, VT		309,300		154,480		201,400		262,380		463,780		163,522		1985
JACKSONVILLE, FL		559,514		0		296,434		263,080		559,514		109,614		2000
JACKSONVILLE, FL		485,514		0		388,434		97,080		485,514		40,447		2000
JACKSONVILLE, FL		196,764		0		114,434		82,330		196,764		34,302		2000
JACKSONVILLE, FL		201,477		0		117,907		83,570		201,477		34,822		2000
JACKSONVILLE, FL		545,314		0		256,434		288,880		545,314		120,364		2000
ORLANDO, FL		867,515		0		401,435		466,080		867,515		194,197		2000
Miscellaneous Investments		12,200,724		12,924,015		7,436,922		17,687,817		25,124,739		16,426,126

	$	425,827,135	$	78,046,667	$	252,082,801	$	251,791,001	$	503,873,802	$	136,669,475


(1)	Initial cost of leasehold or acquisition investment to company represents the aggregate of the cost incurred during the year in which the company purchased the property for owned properties or purchased a leasehold interest in leased properties. Cost capitalized subsequent to initial investment also includes investments made in previously leased properties prior to their acquisition.

(2)	Depreciation of real estate is computed on the straight-line method based upon the estimated useful lives of the assets, which generally range from sixteen to twenty-five years for buildings and improvements, or the term of the lease if shorter. Leasehold interests are amortized over the remaining term of the underlying lease.

(3)	The aggregate cost for federal income tax purposes was approximately $481,189,000 at December 31, 2009.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized.


	Getty Realty Corp.
	(Registrant)

	By:	/s/ Thomas J. Stirnweis

		Thomas J. Stirnweis,
		Vice President, Treasurer and
		Chief Financial Officer
		March 16, 2010

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.


By:	/s/ Leo Liebowitz	By:	/s/ Thomas J. Stirnweis

Leo Liebowitz		Thomas J. Stirnweis
Chairman, Chief Executive Officer and Director (Principal Executive Officer)		Vice President, Treasurer and Chief Financial Officer (Principal Financial and Accounting Officer)
March 16, 2010		March 16, 2010

By:	/s/ Milton Cooper	By:	/s/ Philip E. Coviello

Milton Cooper		Philip E. Coviello
Director		Director
March 16, 2010		March 16, 2010

By:	/s/ David Driscoll	By:	/s/ Howard Safenowitz

David Driscoll		Howard Safenowitz
Director		Director
March 16, 2010		March 16, 2010

EXHIBIT INDEX

GETTY REALTY CORP.
Annual Report on Form 10-K
for the year ended December 31, 2009


EXHIBIT NO.	DESCRIPTION

2.1	Agreement and Plan of Reorganization and Merger, dated as of December 16, 1997 (the “Merger Agreement”) by and among Getty Realty Corp., Power Test Investors Limited Partnership and CLS General Partnership Corp.	Filed as Exhibit 2.1 to Company’s Registration Statement on Form S-4, filed on January 12, 1998 (File No. 333-44065), included as Appendix A To the Joint Proxy Statement/Prospectus that is a part thereof, and incorporated herein by reference.

3.1	Articles of Incorporation of Getty Realty Holding Corp. (“Holdings”), now known as Getty Realty Corp., filed December 23, 1997.	Filed as Exhibit 3.1 to Company’s Registration Statement on Form S-4, filed on January 12, 1998 (File No. 333-44065), included as Appendix D. to the Joint Proxy/Prospectus that is a part thereof, and incorporated herein by reference.

3.2	Articles Supplementary to Articles of Incorporation of Holdings, filed January 21, 1998.	Filed as Exhibit 3.2 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

3.3	By-Laws of Getty Realty Corp.	Filed as Exhibit 3.3 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

3.4	Articles of Amendment of Holdings, changing its name to Getty Realty Corp., filed January 30, 1998.	Filed as Exhibit 3.4 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

3.5	Amendment to Articles of Incorporation of Holdings, filed August 1, 2001.	Filed as Exhibit 3.5 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

4.1	Dividend Reinvestment/Stock Purchase Plan.	Filed under the heading “Description of Plan” on pages 4 through 17 to Company’s Registration Statement on Form S-3D, filed on April 22, 2004 (File No.333-114730) and incorporated herein by reference.

10.1*	Retirement and Profit Sharing Plan (amended and restated as of January 1, 2002), adopted by the Company on September 3, 2002.	Filed as Exhibit 10.1 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.2*	1998 Stock Option Plan, effective as of January 30, 1998.	Filed as Exhibit 10.1 to Company’s Registration Statement on Form S-4, filed on January 12, 1998 (File No. 333-44065), included as Appendix H to the Joint Proxy Statement/Prospectus that is a part thereof, and incorporated herein by reference.


10.3**	Asset Purchase Agreement among Power Test Corp. (now known as Getty Properties Corp.), Texaco Inc., Getty Oil Company and Getty Refining and Marketing Company, dated as of December 21, 1984.	(a)

10.4	Assignment of Trademark Registrations	Filed as Exhibit 10.4 to Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2007 (File No. 001-13777) and incorporated herein by reference.

10.5*	Form of Indemnification Agreement between the Company and its directors.	Filed as Exhibit 10.5 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.6*	Amended and Restated Supplemental Retirement Plan for Executives of the Getty Realty Corp. and Participating Subsidiaries (adopted by the Company on December 16, 1997 and amended and restated effective January 1, 2009).	Filed as Exhibit 10.6 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.7*	Letter Agreement dated June 12, 2001 by and between Getty Realty Corp. and Thomas J. Stirnweis regarding compensation upon change in control.	Filed as Exhibit 10.7 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.8	Form of Reorganization and Distribution Agreement between Getty Petroleum Corp. (now known as Getty Properties Corp.) and Getty Petroleum Marketing Inc. dated as of February 1, 1997.	Filed as Exhibit 10.8 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.9	Form of Tax Sharing Agreement between Getty Petroleum Corp (now known as Getty. Properties Corp.) and Getty Petroleum Marketing Inc.	Filed as Exhibit 10.9 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.10	Consolidated, Amended and Restated Master Lease Agreement dated November 2, 2000 between Getty Properties Corp. and Getty Petroleum Marketing Inc.	Filed as Exhibit 10.10 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.11	Environmental Indemnity Agreement dated November 2, 2000 between Getty Properties Corp. and Getty Petroleum Marketing Inc.	(a)

10.12	Amended and Restated Trademark License Agreement, dated November 2, 2000, between Getty Properties Corp. and Getty Petroleum Marketing Inc.	(a)

10.13	Trademark License Agreement, dated November 2, 2000, between Getty™ Corp. and Getty Petroleum Marketing Inc.	(a)

10.14*	2004 Getty Realty Corp. Omnibus Incentive Compensation Plan.	(a)


10.15*	Form of restricted stock unit grant award under the 2004 Getty Realty Corp. Omnibus Incentive Compensation Plan, as amended.	Filed as Exhibit 10.15 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.16**	Contract for Sale and Purchase between Getty Properties Corp. and various subsidiaries of Trustreet Properties, Inc. dated as of February 6, 2007.	Filed as Exhibit 10.20 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-13777) and incorporated herein by reference.

10.17	Senior Unsecured Credit Agreement dated as of March 27, 2007 with J. P. Morgan Securities Inc., as sole bookrunner and sole lead arranger, the lenders referred to therein, and JPMorgan Chase Bank, N.A., as administrative agent for the lenders.	Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed April 2, 2007 (File No. 001-13777) and incorporated herein by reference.

10.18*	Severance Agreement and General Release by and between Getty Realty Corp. and Andrew M. Smith effective October 31, 2007 and dated November 13, 2007.	Filed as Exhibit 10.22 to the Company’s Current Report on Form 8-K filed November 14, 2007 (File No. 001-13777) and incorporated herein by reference.

10.19*	Amendment to the 2004 Getty Realty Corp. Omnibus Incentive Compensation Plan dated December 31, 2008.	Filed as Exhibit 10.19 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.20*	Amendment dated December 31, 2008 to Letter Agreement dated June 12, 2001 by and between Getty Realty Corp. and Thomas J. Stirnweis regarding compensation upon change of control. (See Exhibit 10.7).	Filed as Exhibit 10.20 to Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-13777) and incorporated herein by reference.

10.21	Unitary Net Lease Agreement between GTY MD Leasing, Inc. and White Oak Petroleum LLC, dated as of September 25, 2009.	Filed as Exhibit 10.1 to Company’s Current Report on Form 8-K filed September 25, 2009 (File No. 001-13777) and incorporated herein by reference.

10.22	Loan Agreement among GTY MD Leasing, Inc., Getty Properties Corp., Getty Realty Corp., and TD Bank, dated as of September 25, 2009.	Filed as Exhibit 10.2 to Company’s Current Report on Form 8-K filed September 25, 2009 (File No. 001-13777) and incorporated herein by reference.

14	The Getty Realty Corp. Business Conduct Guidelines (Code of Ethics).	(a)

21	Subsidiaries of the Company.	(a)

23	Consent of Independent Registered Public Accounting Firm.	(a)

31(i).1	Rule 13a-14(a) Certification of Chief Financial Officer.	(b)

31(i).2	Rule 13a-14(a) Certification of Chief Executive Officer.	(b)


32.1	Section 1350 Certification of Chief Executive Officer.	(b)

32.2	Section 1350 Certification of Chief Financial Officer.	(b)


(a)	Filed herewith

(b)	Furnished herewith. These certifications are being furnished solely to accompany the Report pursuant to 18 U.S.C. Section. 1350, and are not being filed for purposes of Section 18 of the Exchange Act, and are not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

*	Management contract or compensatory plan or arrangement.

**	Confidential treatment has been granted for certain portions of this Exhibit pursuant to Rule 24b-2 under the Exchange Act, which portions are omitted and filed separately with the SEC.