Sumit Roy
President and Chief Executive Officer at Realty Income
Thank you, Andrea. Welcome, everyone. We are pleased to report solid 2023 first quarter results, exhibiting continued momentum in our business. I would like to express my utmost gratitude to our one team whose efforts enable us to continue delivering on our growth objectives. I would also like to thank our equity and fixed income investors for their continued vote of confidence. Our team's efforts and the benefits of our size and scale were reflected in our first quarter results, highlighted by approximately $1.7 billion of high-quality investments acquired at a cash cap rate of 7%. This represents a 90 basis point increase compared to the investment cash cap rate we achieved in the fourth quarter of last year. and resulted in an investment spread of 163 basis points, which is above our historical averages.
As we have experienced in prior cycles, cap rates for our investments after an adjustment period have historically tended to be positively correlated with interest rates, which is a trend we have largely continued to experience this year after the recent Horizon rates. Our ability to access well-priced capital has historically served as a competitive advantage and is a testament to our long history of maintaining a conservative balance sheet and a diversified real estate portfolio supported by clients who are leaders in their respective industries. Amidst an environment in which capital is expensive and are scarce for many of our clients, our value proposition is even more pronounced. This dynamic is reflected in the recent portfolio acquisitions we have announced, the active deal pipeline we see today and the favorable pricing spread we see for large portfolio transactions vis-a-vis one-off single asset transactions. Our differentiated platform extends beyond the external growth lens. Recently, we have taken steps to leverage the size of our portfolio and the history of our operating business through the continued development of advanced analytics.
The objective of this initiative is to develop predictive and prescriptive insights that harness the collective proprietary data that we've accumulated over several decades of investing in managing and releasing single-tenant net lease properties. Our team's proprietary predictive analytic tool leverages the strove of information in our investment underwriting, portfolio management, asset management and development efforts enabling even more informed investment decisions made by our best-in-class One team members. As our business grows, so too will the predictive power of this tool, which we believe will generate significant value for our stakeholders as we refine the accuracy test conclusions and broaden scope across industries, property types and geographies. As part of our core investment thesis, our size and scale have created opportunities to serve as a capital provider for best-in-class partners looking for alternative means of financing given elevated debt costs. In the first quarter, we agreed to acquire up to 415 high-quality convenience stores from EG Group for $1.5 billion.
Over 80% of the total portfolio annualized contractual rent is expected to be generated from properties under the Cumberland Farms brand, and we expect to close on this transaction in the second quarter. As illustrated by this deal, we believe our ability to offer not only certainty of close, but also attractively priced capital as a one-stop solution for sale-leaseback transactions is particularly valuable to institutional sellers of real estate today. We believe this will continue to expand our competitive advantage. Internationally, we continue to venture into new geographical verticals and grow the total addressable market opportunity. This quarter, we took advantage of favorable pricing internationally to acquire properties worth approximately $390 million at an initial cash lease yield of 7.6%. After our initial entry into international markets in 2019, we now derive 11.7% of total portfolio annualized contractual rent from those markets. This natural extension of our platform has been a pillar of growth for the last four years and is indicative of our ability to methodically establish and scale a new vertical.
Given the continued momentum in our acquisitions pipeline and our progress to date, we are increasing our 2023 investment guidance to over $6 billion from our prior guidance of over $5 billion. Consistent with our investment strategy, we remain disciplined with regard to our balance sheet. Subsequent to our April bond offering, which settled on April 14. We held approximately $5.6 billion of liquidity, including unsettled forward equity totaling $1.5 billion. As a result, our current financial position has afforded us the ability to lean into near-term investment opportunities. Moving to operations. Our platform continues to generate durable cash flows, which support our stable earnings profile. For the first quarter, we are pleased to report occupancy of 99%, matching last quarter for the highest rate at the end of a reporting period in over 20 years.
Additionally, we generated a 101.7% recapture rate across 176 renewed or new leases executed during the quarter. These results are a reflection of our talented asset management team and our unwavering commitment to core capital allocation principles, which include a focus on industry-leading clients who often operate in a low price point service-based or nondiscretionary industries. Our purposeful diversification across industries, geographies and clients and our emphasis on high-quality real estate locations and rigorous credit underwriting. Our investment philosophy is nuanced and not simply predicated upon the pursuit of investment-grade clients, which ended the first quarter at 40.8% of our annualized contractual rent. Many of our strongest operators, such as Sainsbury's have no public debt and thus are not rated at all. However, the consistency of their operations and health of their balance sheet are favorable attributes that are consistent with those of an investment-grade rated company.
We estimate that approximately 5.3% of our annualized contractual rent comes from unrated operators without public debt. We remain committed to investments that offer us attractive risk-adjusted returns as evidenced throughout our history. And going forward, where we believe, based upon our disciplined underwriting and analytics, we are achieving better returns per unit of incremental risk. I would like to briefly touch on Cineworld which represents 1.3% of our annualized contractual rent. Despite the ongoing Chapter 11 bankruptcy, we have continued to receive 100% of contractual rent in the first quarter and through April. As of March 31, 2023, we had cumulative reserves of $33 million on our Cineworld properties. Outstanding receivables net of reserves and excluding straight-line receivables were $14.1 million.
We remain in discussions with this client and we'll update the market on the outcome of these discussions at the appropriate time. Before turning the call over to Christie, I would like to highlight that in March, we published our third annual sustainability report which details our ongoing commitment to operating as a responsible corporate citizen for our stockholders, our team, the communities in which we operate and the environment. I'm proud of our continued progress on ESG initiatives as we seek to fulfill our commitment to building sustainable relationships and I strongly encourage all of today's listeners to navigate to the Sustainability page of our website to review the report. With that, I'd like to turn it over to Christie.