Sila Realty Trust, Inc. · NYSE:SILA
Sila Realty Trust — Q3 2024 Earnings Presentation
40 slides from Sila Realty Trust's earnings presentation, Nov 12, 2024
Slide 1: BofA Securities 2024 Global Real Estate Conference
BofA Securities 2024 Global Real Estate Conference Skillful and Thoughtful Investing
Slide 2: Disclosures
Disclosures Forward Looking Statements Certain statements contained herein, other than historical fact, may be considered “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and
Slide 3: Sila Realty Trust is a net lease REIT specializing in healthcare properties
Sila Realty Trust is a net lease REIT specializing in institutional quality healthcare properties with a ‘Shareholder First’ mentality. We are an investor in real estate properties across the healthcare continuum of services. Applying a core sector asset approach, we believe Sila offers investors th
Slide 4: Introductions
Introductions Michael A. Seton Kay C. Neely President and Chief Executive Officer Executive Vice President Founder and Board Member and Chief Financial Officer Christopher K. Flouhouse Miles F. Callahan Executive Vice President Senior Vice President and Chief Investment Officer Capital Markets and I
Slide 5: Sila Realty Trust At a Glance
Sila Realty Trust At a Glance Sila Realty Trust, Inc. is a net lease REIT with a strategic focus on investing in the significant, growing, and resilient healthcare sector of the U.S. economy. What differentiates us? Portfolio Highlights • The only net lease REIT focused solely on investing in health
Slide 6: Pure-Play in High Quality Healthcare Assets
Pure-Play in High Quality Healthcare Assets NYSE Listing Day | June 13, 2024
Slide 7: Net Lease REIT Focused on High-Quality Healthcare Assets
1 Net Lease REIT Focused on High-Quality Healthcare Assets Healthcare trends are shifting patients to cost-effective, easy-to-access, healthcare settings, driving demand for strategic asset classes along the healthcare continuum. (Highest Cost Settings) (Lowest Cost Settings) Highest Acuity Lowest A
Slide 8: Large Growing Market in a Defensible Sector
1 Large Growing Market in a Defensible Sector Capitalizing on favorable macro tailwinds driving demand for healthcare settings that are cost efficient while delivering personalized quality of care. Share of Population Share of Spending People age 65+, on average, spend more on healthcare By 2030, al
Slide 9: Proven Track Record of Value Creation
Proven Track Record of Value Creation Fort Smith Healthcare Facility, Arkansas
Slide 10: Asset Strategy and Platform Positioned for Growth
2 Asset Strategy and Platform Positioned for Growth Our in-depth, well-disciplined underwriting strategy, executed by a seasoned team of in-house professionals, allows the Company to source accretive opportunities that are critical to the business operations of our tenants and the communities they s
Slide 11: Proven Acquisition Track Record
2 Proven Acquisition Track Record With a multifaceted investment strategy, our seasoned leadership team utilizes our deep industry relationships while being supported by our disciplined underwriting team with a dual focus on both real estate and tenant credit. YTD 2024 $2.2 B $16.4 M 137 Acquired 8
Slide 12: Broad Acquisition Sourcing Network Affords Opportunity to be Highly Selective
2 Broad Acquisition Sourcing Network Affords Opportunity to be Highly Selective Sila’s Acquisitions and Credit Underwriting teams have evaluated over 2,600 healthcare investment opportunities since 2019. Sourcing and Underwriting Investment Opportunities(1) • Relationships and reputation with tenant
Slide 13: Acquisition and Underwriting Framework
2 Acquisition and Underwriting Framework Sila’s overall portfolio quality demonstrates the Company’s sourcing, asset selection, underwriting, and deal execution capabilities. Demographics Financial Review of Tenant Real Estate/Lease Fundamental Review • Target markets with population growth at or •
Slide 14: Disciplined Capital Allocation
2 Disciplined Capital Allocation With a multifaceted investment strategy, our seasoned leadership team utilizes our deep industry relationships while being supported by our diligent underwriting team with a dual focus on both real estate and tenant credit. Portfolio Growth FFO Payout Ratio(3) • Expe
Slide 15: Robust Portfolio Delivers Strong Operating Metrics
Robust Portfolio Delivers Strong Operating Metrics NYSE Listing Day | June 13, 2024
Slide 16: Geographic Diversification
3 Geographic Diversification We seek to acquire and own healthcare real estate diversified across the country, with a focus on “Smile State” markets with strong demographic, economic, and social drivers. id a lo r ,F pa m Ta Top 5 States by ABR(1) Texas 28.3% Oklahoma 7.3% Louisiana 5.8% Arizona 5.6
Slide 17: Sponsor Strength and Recognition
3 Sponsor Strength and Recognition Market leading healthcare providers across the country put their trust in our facilities to provide the highest quality healthcare settings. Logos represent top 10 tenant diversification 17
Slide 18: Diversified and Secure Tenancy
3 Diversified and Secure Tenancy Sila’s 137 healthcare properties are well-diversified through tenancy and across the continuum of care, reducing overexposure to any single healthcare subtype. Property Type Diversification(1) Tenant/Sponsor Diversification(2)(4) (ABR(2), Properties) Post Acute Medic
Slide 19: Strong Operating Metrics from Long-Term Leases
3 Strong Operating Metrics from Long-Term Leases We believe that long-term leases provide stability with a future ability to capitalize on opportunities. Portfolio Leased 8.2 Yrs 97.5% 5.3 M 99.5% 99.4% Weighted Avg. Weighted Avg. Rentable 97.5% Remaining Lease Term Leased Rate Square Feet 21% 169 $
Slide 20: Sila Demonstrates Strong Metrics Relative to Peers
3 Sila Demonstrates Strong Metrics Relative to Peers Sila’s key fundamental metrics closely resemble net lease REIT peers and rank among the top healthcare peers. Long Lease Term Portfolio Leased 11.9 Yrs 99.6% 97.5% 8.2 Yrs 92.7% 5.9 Yrs SILA Net Lease Healthcare SILA Net Lease Healthcare Peer Aver
Slide 21: Fortified Balance Sheet to Fund Future Growth
Fortified Balance Sheet to Fund Future Growth Reading Healthcare Facility, Pennsylvania
Slide 22: Fortified Balance Sheet
4 Fortified Balance Sheet Sila’s management team has built a balance sheet that we believe positions the Company for growth and provides insulation from adverse and unpredictable market dislocations. Balance Sheet Highlights Net Debt / EBITDAre(4) 4.2x 3.1x 2.1x $587 M 100% 100% Liquidity(1) Fixed R
Slide 23: Micro-Hospitals and Select Properties Demonstrating Investment Strategy
4 Select Properties Demonstrating Investment Strategy Sila has an opportunistic ability to continue optimizing our portfolio composition on top of already possessing a curated and sizable assortment of high- quality and diversified healthcare net lease assets as demonstrated by our 2024 acquisitions
Slide 24: Experienced Leadership Team
Experienced Leadership Team NYSE Listing Day | June 13, 2024
Slide 25: Management with a History of Executing on Shareholder Friendly Initiatives
5 Management with a History of Executing on Shareholder Friendly Initiatives We believe past behavior is the best predictor of future behavior. 2010 Putting Shareholders First Founding of predecessor company. 2018 $556.2M special cash distribution ($3.00/share) paid to 2014 predecessor company share
Slide 26: Experienced Management Team
5 Experienced Management Team Cycle-tested management team with proven operating experience and extensive knowledge of the existing portfolio and tenant partners. Michael A. Seton President and Chief Executive Officer • 30+ years of experience in real estate investment and finance, completing billio
Slide 27: Robust Corporate Governance Led by Experienced Board of Directors
5 Robust Corporate Governance Led by Experienced Board of Directors Our Board of Directors brings industry insights, strong business expertise and diverse perspectives to Sila. Jonathan Kuchin, Chairman of the Board* Member of Audit Committee • Formerly Tax Partner at PWC - Focused on public and pri
Slide 28: Commitment to Corporate Governance
5 Commitment to Corporate Governance Board Composition ✓ Experienced Board of Directors, Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee ✓ Majority independent Board of Directors (83%), who bring a diverse array of backgrounds, experience, and perspectives
Slide 29: Commitment to Corporate Responsibility
Commitment to Corporate Responsibility Tree Planting Volunteer Event | April 24, 2024
Slide 30: Responsibility and Philanthropy
6 Responsibility and Philanthropy Sila believes in maintaining a healthy, prosperous, and sustainable work environment through stewardship of the environment, the community, the employees, and strong corporate governance practices. Governance Social Environmental • Diversity in board makeup: 5 indep
Slide 31: Appendix
Appendix Tampa Healthcare Facility II, Florida
Slide 32: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Adjusted Fair Value of Real Estate Investments Adjusted fair value of real estate investments is calculated using the real estate values determined as of the most recent NAV (as defined below), adjusted for property acquisitions and dispositions, major capit
Slide 33: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Earnings Before Interest, Taxes, Depreciation, Amortization, Rent and Management Fees (EBITDARM) The Company utilizes EBITDARM, a supplemental non-GAAP performance measure, to evaluate the core operations of our tenants and/or guarantors (together, the “Obli
Slide 34: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Enterprise Value Enterprise value represents market capitalization plus net debt. Funds from Operations (FFO), Core FFO, and Adjusted FFO (AFFO) FFO, a non-GAAP financial measure, is calculated consistent with NAREIT’s definition, as net income (loss) (calcu
Slide 35: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Funds from Operations (FFO), Core FFO, and Adjusted FFO (AFFO) (Cont’d) Year Ended Three Months Ended December 31, December 31, March 31, June 30, 2022 2023 2024 2024 Net income (loss) attributable to common stockholders $ (7,978) $ 24,042 $ 14,980 $ 4,628 A
Slide 36: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Liquidity A financial metric that represents the outstanding cash and cash equivalents combined with the remaining borrowing base availability on the Company’s credit facility at a point in time. Market Capitalization The total number of outstanding shares o
Slide 37: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Net Operating Income (NOI), Cash NOI and Same Store Cash NOI NOI, a non-GAAP financial measure, is defined as rental revenue, less rental expenses, on an accrual basis. Cash NOI is calculated to exclude the impact of GAAP adjustments to rental revenue and re
Slide 38: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Net Operating Income (NOI), Cash NOI and Same Store Cash NOI (Cont’d) Year Ended Three Months Ended December 31, December 31, March 31, June 30, 2022 2023 2024 2024 Rental revenue $ 179,986 $ 189,065 $ 50,639 $ 43,554 Rental expenses (17,950) (20,196) (5,554
Slide 39: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Remaining Lease Term The number of periods remaining in each tenant’s lease, calculated on a weighted average basis using annualized base rent. Rent Escalation The amount of base rent increases that are included within each tenant’s lease, calculated on a we
Slide 40: Contact Information
Contact Information Corporate Address Miles Callahan 1001 Water Street Senior Vice President, Suite 800 Capital Markets & Investor Relations Tampa, FL 33602 IR@silarealtytrust.com www.SilaRealtyTrust.com