18 slides from Safehold Inc. New's earnings presentation, Jul 30, 2024
Slide 1: Q2'24 Earnings Results
Q2’24 Earnings Results
Slide 2: Q2'24 Summary
Q2’24 Summary Investment Activity Debt & Hedging 6 closed deals for $98m1 $2.0b $750m Revolver Commercial Paper 4 3 100% Closed new 5-year unsecured Unsecured funding alternative revolving credit facility to current revolving credit Markets Sponsors Multifamily (replaced existing aggregate facility
Slide 3: Portfolio Growth
Portfolio Growth Aggregate GBV (Ground Leases) Growing Multifamily Focus (Multifamily Asset Count) 81 Estimated Unrealized Capital Appreciation 61 21x Estimated UCA Growth since IPO $9.9b $9.1b 22 19x Portfolio Growth since IPO7 1 IPO Q2'20 Q2'22 Q2'24 $5.2b (6/22/2017) Total 12 61 123 143 $6.5b Ass
Slide 4: Earnings Results
Earnings Results Q2 GAAP Net Income and EPS increased Y/Y primarily due to: o +$7.0m: increase in asset-related revenue from new investments and rent growth o +$3.8m: savings in G&A net of STHO management fee o -$3.1m: increase in interest expense due to balance of debt outstanding and cost of cap
Slide 5: Portfolio Yields
Portfolio Yields (Core Ground Lease Portfolio Gross Book Value: $6.5b on 92-Year W.A. Lease Term w/ Ext.)9 GAAP Earnings Forward Yield-to-Maturity 3.6% + Non-Cash Rent & 5.3% + Variable rent 5.8% + Upside when 5.9% + Caret valuation 7.5% Adj. pickup11 inflation >2% Annualized Annualized Economic Inf
Slide 6: Portfolio Diversification
Portfolio Diversification Safehold primarily invests in the top 30 MSAs across the U.S., which we believe are positioned for long-term sustainable growth $6.5b Core Ground Lease Portfolio Top 10 Markets (% of GBV, Count, Rent Coverage3, GLTV2) (92-year w.a. extended lease term) 1. Manhattan (22%)a –
Slide 7: Capital Structure
Capital Structure Debt Overview Outstanding Hedges Non-Recourse SOFR Swap (Revolver) Treasury Locks (Long-Term Debt) Unsecured Notes Secured $1.8b $1.5b Notional: $500m Notional: $350m Term: 5-years (ends April 2028) Rate: ~3.67% 30-year treasury Total Rate: ~3.0% SOFR Unrealized Gain Position: ~$37
Slide 8: Appendix
Appendix 8 Safehold | The Ground Lease Company | July 2024
Slide 9: Income Statement
APPENDIX Income Statement For the three months ended June 30, For the six months ended June 30, 2024 2023 2024 2023 Revenues: Interest income from sales-type leases $65,235 $58,158 $128,453 $115,220 Operating lease income 16,691 16,750 37,694 37,651 Interest income - related party 2,357 2,381 4,714
Slide 10: Balance Sheet
APPENDIX Balance Sheet As of June 30, 2024 As of December 31, 2023 Assets: Net investment in sales-type leases $3,380,007 $3,255,195 Ground Lease receivables, net 1,746,567 1,622,298 Real estate: Real estate, at cost 740,971 744,337 Less: accumulated depreciation (43,414) (40,400) Real estate, net 6
Slide 11: Portfolio Reconciliation
APPENDIX Portfolio Reconciliation IPO (6/22/17) 6/30/20 6/30/21 6/30/22 6/30/23 6/30/24 Net investment in Sales-Type Leases - $1,045 $1,432 $2,912 $3,168 $3,380 Ground Lease receivables - 477 $680 $1,236 $1,485 $1,747 Pro-rata interest in Ground Leases held as - 343 $438 $443 $472 $452 equity method
Slide 12: Earnings Reconciliation
APPENDIX Earnings Reconciliation For the three months ended For the six months ended June 30, June 30, 2024 2023 2024 2023 Net income (loss) attributable to Safehold Inc. common shareholders $29,665 $22,130 $60,393 $26,812 Add: Merger & Caret related costsa - 425 - 22,023 Net income excluding merger
Slide 13: Caret Timeline
APPENDIX Caret Timeline 2H’18: Feb’22: Nov’22: Formed a subsidiary called “Caret” designed to help recognize the value Outside investors participate in Series 3 participants from Series A round of the capital appreciation above Cost A roundb committed to Series B round under Basis. Employee performa
Slide 14: Caret Ownership
APPENDIX Caret Ownership In April 2024, the Series A Round was redeemed. It was settled with funds that were previously held in a restricted account; thus no impact to liquidity or revolver borrowings. SAFEHOLD (NYSE: SAFE) 100% ~84% GL Units Caret Units Rent Stream plus Original Cost Capital Apprec
Slide 15: Unrealized Capital Appreciation Details
APPENDIX Unrealized Capital Appreciation Details Refer to the Glossary in the Appendix for a definition of Owned Residual Portfolio, Unrealized Capital Appreciation (“UCA”), and “Combined Property Value” (“CPV”). SAFE relies in part on CBRE’s valuations of the CPV of our portfolio in calculating UCA
Slide 16: Glossary
APPENDIX Glossary Aggregate Cost Basis Represents Cost Basis plus unfunded commitments of the Core Ground Lease Portfolio. For unfunded commitments, it represents the aggregate future amount to be paid under the commitments. Aggregate Gross Book Value Represents the Gross Book Value plus unfunded co
Slide 17: Endnotes
APPENDIX Endnotes (1) Presentation assumes 100% ownership of closed deals. Our JV partner participated in 5 deals and purchased 45% of these commitments. $98m total commitments (Safehold $59m and partner $39m) includes $40m of forward commitments (Safehold $22m and partner $18m) that have not yet be
Slide 18: Forward-Looking Statements and Other Matters
Forward-Looking Statements and Other Matters This presentation may contain forward-looking statements. All statements other than statements of historical fact are forward-looking statements. These forward-looking statements can be identified by the use of words such as “illustrative”, “representativ