ESCONDIDO, CALIFORNIA, October 17, 2003—Realty Income Corporation (Realty Income), The Monthly Dividend Company®, (NYSE:O) announced today that it has provided $94.5 million in sale-leaseback financing to The Pantry Inc. (NASDAQ: PTRY) by acquiring 114 convenience store properties under long-term, net-lease agreements.

Realty Income acquired the 114 properties under 20-year, triple-net lease agreements. The stores are, on average, approximately 2,700 leasable square feet and are situated on a lot size of 1.14 acres. In addition, each location has, on average, 5.5 multi-pump gasoline dispensers and are seasoned stores with an average 14-year operating history. The average purchase price for each property was $829,000.

The Company further disclosed that The Pantry, Inc. will use the financing proceeds to partially fund their previously disclosed acquisition of Golden Gallon Stores from Ahold, USA, a subsidiary of Royal Ahold NV (NYSE:AHO). The properties are existing, high volume, profitable convenience stores operating under the "Golden Gallon" brand name and are located in Tennessee and Georgia where Golden Gallon has a strong market presence and is considered to be a well established and recognized chain. Golden Gallon was founded in 1959 and currently operates 138 convenience stores.

The Pantry, Inc. is the leading convenience store operator in the Southeastern United States and one of the largest independently operated convenience store chains in the country. Upon completion of the Golden Gallon acquisition, The Pantry's market presence will significantly increase to approximately 1,400 stores in ten Southeastern states.

Commenting on the acquisition, Tom A. Lewis, Chief Executive Officer stated, "We are pleased to have been able to participate in the financing of the Golden Gallon acquisition by The Pantry, Inc. The high quality stores, good locations, excellent operating history and long-term leases, coupled with The Pantry's quality management team, make these stores a welcome addition to our portfolio of properties. In addition, this immediately accretive acquisition further diversifies our real estate portfolio and provides us with increased lease revenue from which to pay monthly dividends."

Commenting further on Realty Income's acquisition of its Golden Gallon properties, Peter J. Sodini, President and Chief Executive Officer of The Pantry, Inc. said, "Realty Income's $94.5 million in sale-leaseback financing was a critical component to our successful acquisition of Golden Gallon. The Company's ability to understand our industry, business plan and properties allowed us to move quickly to secure this transaction and permanently finance this important acquisition for The Pantry."

Realty Income will hold a conference call on Thursday, October 30, 2003 at 1:30 PM Pacific Time to discuss third quarter operating results, the current acquisitions environment for net-leased properties, and will also provide its initial 2004 earnings estimates.

Consistent with Realty Income's disclosure policy, the Company does not disclose the lease rate on an individual tenant transaction. Lease rates, terms, and conditions are competitive in nature and are a major component of the Company's new business development program. The Company believes the disclosure of individual rate negotiations would be damaging to its competitive position and its ability to complete new property acquisitions. As in the past, Realty Income will announce its blended lease rate and lease terms on a cumulative basis in the Company's quarterly press release on operations.

Forward-Looking Statements
Statements in this press release that are not strictly historical are "forward-looking" statements. Forward-looking statements involve known and unknown risks, which may cause the Company's actual future results to differ materially from expected results. These risks include, among others, general economic conditions, local real estate conditions, the availability of capital to finance planned growth, property acquisitions and the timing of these acquisitions, and the profitability of the Company's subsidiary, Crest Net Lease, as described in the Company's filings with the Securities and Exchange Commission. Consequently, such forward-looking statements should be regarded solely as reflections of the Company's current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. The Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.

Realty Income is The Monthly Dividend Company®, a New York Stock Exchange real estate company dedicated to providing shareholders with dependable monthly income. To date the Company has declared 400 consecutive monthly dividend payments throughout its 34-year operating history. The monthly income is supported by the cash flow from over 1,300 retail properties owned under long-term lease agreements with leading regional and national retail chains. The Company is an active buyer of net-leased retail properties nationwide.

Note to Editors

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