Diversified Healthcare Trust · NASDAQ:DHC
Diversified Healthcare Trust — Investor Presentation (March 2023)
29 slides from Diversified Healthcare Trust's investor presentation, Mar 8, 2023
Slide 1: Investor Presentation March 2023
INVESTOR PRESENTATION March 2023
Slide 2: Warning Concerning Forward Looking Statements
2 WARNING CONCERNING FORWARD LOOKING STATEMENTS This presentation contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. Also, whenever we use words such as “believe”, “expect”, “anticipate”
Slide 3: Warning Concerning Forward Looking Statements
3 WARNING CONCERNING FORWARD LOOKING STATEMENTS (o) although we have obtained a waiver from compliance with the fixed charge coverage ratio covenant included in our credit agreement through January 15, 2024, if our operating results and financial condition are further adversely impacted by current e
Slide 4: Reasons to Invest in DHC
4 REASONS TO INVEST IN DHC An institutional quality portfolio that is diversified across the healthcare spectrum, and seeks long-term stable growth. Predominantly private pay assets with limited exposure to government reimbursement programs such as Medicare and Medicaid. Long-term, positive healthca
Slide 5: A Well Positioned National Healthcare REIT
5 DHC seeks to capitalize on the healthcare demands of an aging U.S. population. A WELL POSITIONED NATIONAL HEALTHCARE REIT(1) 379 Healthcare Related Properties $7.1B Investment Portfolio 8.8M sf Medical Office & Life Science Space 27,408 Senior Living Community Units Focused growth • Well-located m
Slide 6: Portfolio Profile
6 PORTFOLIO PROFILE DHC’s historically opportunistic approach to investing in quality healthcare related properties has created a portfolio that is broadly diversified with national scale. Asset Class By NOI(1)(2) (based on Q4 2022 same property NOI) 379 properties located in 36 states and Washingto
Slide 7: High Quality Medical Office and Life Science Portfolio
7 HIGH QUALITY MEDICAL OFFICE AND LIFE SCIENCE PORTFOLIO Almost 500 tenants with same property occupancy of 90.0% at December 31, 2022.(1)(2) Maryland Heights, MO Tenant: Magellan Health Square feet: 232,521 (1) Excludes unconsolidated joint ventures. (2) Occupancy data is as December 31, 2022 and i
Slide 8: Office Portfolio
8 OFFICE PORTFOLIO (1) Excludes unconsolidated joint ventures. (2) Includes both medical office and life science properties. Based on Q4 2022 NOI. See Appendix for the calculation of NOI and a reconciliation of net income (loss) determined in accordance with GAAP to that amount. (3) Annualized renta
Slide 9: Medical Office and Life Science Dynamics
9 0 2 4 6 8 10 12 2Q05 4Q05 2Q06 4Q06 2Q07 4Q07 2Q08 4Q08 2Q09 4Q09 2Q10 4Q10 2Q11 4Q11 2Q12 4Q12 2Q13 4Q13 2Q14 4Q14 2Q15 4Q15 2Q16 4Q16 2Q17 4Q17 2Q18 4Q18 2Q19 4Q19 2Q20 4Q20 2Q21 4Q21 2Q22 4Q22 MEDICAL OFFICE AND LIFE SCIENCE DYNAMICS Strong demographic tailwinds driving healthcare real estate d
Slide 10: Office Portfolio – Fourth Quarter Update
10 OFFICE PORTFOLIO – FOURTH QUARTER UPDATE For the quarter ended December 31, 2022, our Office Portfolio segment represented 58% of same property cash basis NOI. (1) Represents estimated square footage upon project completion. (2) Project costs are as of December 31, 2022 and include estimated cons
Slide 11: Investments in Unconsolidated Joint Ventures
11 INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES 8631 & 8635 West Third Street Los Angeles, CA Total SF: 330,892 4770 Regent Boulevard Irving, TX Total SF: 116,948 Vertex Pharmaceuticals Boston, MA Total SF: 1,134,479 30 New Crossing Road Reading, MA Total SF: 33,600 330 Baker Ave Concord, MA Total S
Slide 12: Senior Living Portfolio
12 SENIOR LIVING PORTFOLIO The Palms at Lake Spivey Operator: Five Star Senior Living Jonesboro, GA 200 Units Five Star Premier Residences Operator: Five Star Senior Living Pompano Beach, FL 170 Units Oaks at Stockbridge Operator: Oaks-Caravita Senior Care Stockbridge, GA 61 Units Amber Ridge Operat
Slide 13: SHOP Segment
13 SHOP SEGMENT DHC's SHOP segment contains 230 communities with over 25,000 units with a diverse group of best-in-class operators. (1) Manager Location Number of Communities(1) Number of Units Cedarhurst Senior Living IL/WI 13 785 Charter Senior Living FL/MD/TN/VA 17 977 IntegraCare Senior Living P
Slide 14: Senior Living Portfolio Overview
14 106.3 108.5 110.3 98 100 102 104 106 108 110 112 Indexed Occupancy Since March 2021(2) NIC Primary/Secondary Mkts DHC SHOP DHC NNN SENIOR LIVING PORTFOLIO OVERVIEW Current Portfolio (as of December 31, 2022) Operator Community Mix Number of Communities(1) Units(1) SHOP Segment IL, AL, MC, SNF, CC
Slide 15: Current Environment & Future Demographics
15 0 5 10 15 20 25 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E Millions Age 80+ Population Growth (1) CURRENT ENVIRONMENT & FUTURE DEMOGRAPHICS Long-Term Industry Demographics Remain Compelling • Senior l
Slide 16: SHOP Redevelopment Projects
16 SHOP REDEVELOPMENT PROJECTS Project Location Type of Property Number of Units Estimated Project Costs(1) Total Costs Incurred(2) Estimated Completion Date(3) Five Star Premier Residences of Teaneck Teaneck, NJ IL/AL 218 $9.8 $7.0 Q2 2023 Leisure Park Lakewood, NJ IL/AL/MC 355 $9.0 $5.7 Q2 2023 Ph
Slide 17: Financial Profile
17 FINANCIAL PROFILE Historical Sources of Capital (1) Represents secured fixed rate debt obligations. (2) December 31, 2022 balance adjusted to give effect to the January and February 2023 repayments of borrowings under DHC's credit facility pursuant to its credit agreement. (3) Includes $5.3 milli
Slide 18: Strong Management Platform Advantages
18 STRONG MANAGEMENT PLATFORM ADVANTAGES Financial Services: Real Estate Services: Business Services: Accounting Acquisitions/ Dispositions Administration Capital Markets Asset Management Human Resources Compliance/ Audit Construction/ Development Information Technology (IT) Finance/ Planning Engine
Slide 19: The RMR Group: A Winning Tradition
19 THE RMR GROUP A WINNING TRADITION EPA’S ENERGY STAR Partner of the Year 2019 - 2022. 70 properties with EPA ENERGY STAR certifications 60 properties with BOMA designations. Ranked #1 for portfolio with most designations 56 properties with LEED designations SUSTAINABILITY Boston Globe’s Top Places
Slide 20: DHC Benefits from Relationship with The RMR Group
20 DHC BENEFITS FROM RELATIONSHIP WITH THE RMR GROUP RMR provides DHC with scale and efficiencies. • DHC has no employees; RMR provides all services. • RMR’s acquisitions team sees a substantial number of properties marketed for sale in every market across the United States. • RMR attracts very stro
Slide 21: Supported by RMR's Personnel Investments
21 SUPPORTED BY RMR'S PERSONNEL INVESTMENTS • RMR continues to invest in personnel overseeing the asset management, development and project management functions. • Since 2016, RMR has added 25 positions to the Senior Living and Office & Industrial Asset Management teams, while it has also added 12 p
Slide 22: Management Agreement Provides for Alignment of Interests
22 MANAGEMENT AGREEMENT PROVIDES FOR ALIGNMENT OF INTERESTS RMR base management fee tied to DHC share price performance • Consists of an annual fee based on 50 bps of the lower of: (1) DHC’s historical cost of real estate, or (2) DHC’s total market capitalization. • There is no incentive for RMR to
Slide 23: Appendix
23 APPENDIX Muse at Torrey Pines San Diego, CA
Slide 24: Financial Summary
24 (1) See Definitions of Certain Non-GAAP Financial Measures in the appendix for a description of why we believe they are appropriate supplemental measures and a description of how we use these measures. (2) See appendix for the calculation of NOI and a reconciliation of net income (loss) determine
Slide 25: Calculation and Reconciliation of NOI and Cash Basis NOI
25 CALCULATION AND RECONCILIATION OF NOI AND CASH BASIS NOI(1) (1) See Definitions of Certain Non-GAAP Financial Measures in appendix for a definition of NOI, Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI, a description of why we believe they are appropriate supplemental measure
Slide 26: Calculation and Reconciliation of NOI, Same Property NOI
26 CALCULATION AND RECONCILIATION OF NOI, CASH BASIS NOI, SAME PROPERTY NOI AND SAME PROPERTY CASH BASIS NOI(1) (1) See Definitions of Certain Non-GAAP Financial Measures in appendix for a definition of NOI, Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI, a description of why we
Slide 27: Calculation and Reconciliation of EBITDA, EBITDAre and Adjusted EBITDAre
(1) See Definitions of Certain Non-GAAP Financial Measures in the appendix for a definition of EBITDA, EBITDAre and Adjusted EBITDAre and a description of why we believe they are 27 appropriate supplemental measures. CALCULATION AND RECONCILIATION OF EBITDA, EBITDAre AND ADJUSTED EBITDAre(1) (Dollar
Slide 28: Calculation and Reconciliation of FFO and Normalized FFO
(1) See Definitions of Certain Non-GAAP Financial Measures in the appendix for a definition of FFO attributable to common shareholders and Normalized FFO attributable to common 28 shareholders, a description of why we believe they are appropriate supplemental measures and a description of how we use
Slide 29: Definitions of NOI, Cash Basis NOI and Same Property NOI
29 NOI, Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI The calculations of NOI, Cash Basis NOI, same property NOI and same property cash basis NOI exclude certain components of net income (loss) in order to provide results that are more closely related to our property level resul
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