Franklin Street Properties Corp. · AMEX:FSP
Franklin Street Properties — Investor Presentation (June 2018)
25 slides from Franklin Street Properties's investor presentation, June 2018
Slide 1: Franklin Street Properties Corp. Investor Presentation – June 2018
Franklin Street Properties Corp. Investor Presentation – June, 2018 401 Edgewater Place ● Wakefield, MA 01880 (781) 557-1300 ● www.fspreit.com 0
Slide 2: Forward-looking Statements and Other Legal Disclosures
Forward-looking Statements and Other Legal Disclosures This presentation may contain forward-looking statements based on current judgments and current knowledge of management, which are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those
Slide 3: Corporate Overview
aT lI FRANKLIN STREET PROPERTIES Corporate Overview
Slide 4: Corporate Overview
Corporate Overview Central Business District (CBD) and Infill Office Properties With Primary Focus on Sunbelt and Mountain West Markets of Atlanta, Dallas, Denver, Houston & Minneapolis Class A Office Value Creation Flexible Balance Portfolio Opportunities Sheet • 34 Properties(1) • 88.5% leased(1)
Slide 5: Corporate Information
Corporate Information 401 Edgewater Place Wakefield, MA 01880 Headquarters Equity Market Capitalization $0.9bn NYSE American: FSP Ticker Total Enterprise Value $2.0bn 34 Directly-Owned Properties (1) Leverage Ratio(2) 47.7% ~9.8mm Directly-Owned Square Feet (1) Fixed Charge Coverage Ratio(2) 3.6x 88
Slide 6: Investment Highlights
Investment Highlights Focused Strategy on Five High Growth Potential Markets High Quality CBD and Infill Office Portfolio Strong Amenity-Rich Submarkets Diverse and Stable Tenant Roster Flexible, Well-Positioned, 100% Unencumbered Balance Sheet (1) Experienced Cycle-Tested Management Team 999 Peacht
Slide 7: Focused Strategy in Five Core Markets
Focused Strategy in Five Core Markets Five Core Investment Principles: 10 Year Job Growth (1) ✓ Invest in Geographic / Economic Diversification ― Spread of geographic and economic concentrations of properties / tenancy across regions and industries ✓ Invest in Markets Where FSP Has Long-Term Knowled
Slide 8: Portfolio Overview
aT lI FRANKLIN STREET PROPERTIES Portfolio Overview
Slide 9: Portfolio Transformation
Portfolio Transformation • FSP has assembled a focused, well-amenitized office portfolio in key • Directly-Owned Properties: 34(1) Sunbelt and Mountain West markets • FSP has substantially repositioned its portfolio around CBD and infill • Directly-Owned Sq.Ft.: ~9.8M(1) assets in five strong growth
Slide 10: Portfolio Transformation
Portfolio Transformation Centennial Willow Bend Eden Bluff Park Montague Lakeside Crossing I Federal Way Hillview East Baltimore Technology Center Office Center Corporate Center I Seneca Center Maryland Heights, Federal Way, WA Milpitas, CA East Baltimore, MD Colorado Springs, Plano, TX Eden Prairie
Slide 11: Weighted Average GAAP rent per occupied square foot
Weighted Average GAAP rent per occupied square foot $30.00 $29.05 $28.87 $27.92 $26.93 $26.04 $25.61 $25.00 $23.69 $20.00 $15.00 $10.00 2012 2013 2014 2015 2016 2017 Q1 2018 ____________________ 10 Source: Public Company filings and disclosures as of December 31 for each year presented and as of Mar
Slide 12: High Quality Office Portfolio
High Quality Office Portfolio FSP Core Markets Comparison FSP Owned Sq. Ft. (1) FSP % Leased (1) Class A Occupancy (2) 2.6M 89.2% 85.4% Denver is recognized as a major center for commerce in the mountain-west region of the United States and has achieved significant growth in terms of both population
Slide 13: Diverse and Stable Tenant Roster
Diverse and Stable Tenant Roster Largest 20 Tenants by % of Leased Sq. Ft. Remaining Aggregate % of Aggregate Tenant Number of Lease Term Leased % of Total Annualized (1) Leased Name Leases in Months Square Feet Square Feet Rent Annualized Rent 1 Quintiles IMS Healthcare Incorporated 1 98 259,531 2.
Slide 14: Future Portfolio Upside
Future Portfolio Upside FSP’s portfolio has approximately 1.2 million square feet of total vacancy (includes 801 Marquette) There is significant near-term upside in four of the five core markets Houston Atlanta • FFO from the Houston properties was approximately $6 million less • Occupancy has dippe
Slide 15: Financial Overview
aT lI FRANKLIN STREET PROPERTIES Financial Overview
Slide 16: 100% Unencumbered Portfolio Strategy
100% Unencumbered Portfolio Strategy FSP utilizes an entirely unsecured debt structure, maintaining an entire portfolio of unencumbered properties Unencumbered Pool Summary (1) 380 Interlocken Broomfield, CO FSP Portfolio # of Directly-Owned Properties 34 Directly-Owned Square Feet ~9.8M Total Gross
Slide 17: Financial Overview
Financial Overview Short-Term Financial Plan: Dividend Rationale: • Extend Debt Maturities • Fund capital expenditures for leasing • De-Lever via use of operating cash and disposition activity • AFFO payout ratio more in-line with peers • Improve Net Debt to EBITDA Ratio • Increased interest cost im
Slide 18: Appendix
Appendix Legacy Tennyson Center Liberty Plaza Collins Crossing Plano, TX Addison, TX Richardson, TX 17
Slide 19: Owned Portfolio Overview
Owned Portfolio Overview Percent Wtd Occupied GAAP Percent Wtd Occupied GAAP MSA / Property Name City State Square Feet Leased Percentage (a) Rent (b) MSA / Property Name City State Square Feet Leased Percentage (a) Rent (b) East Region Midwest Region Washington, D.C. Chicago Meadow Point Chantilly
Slide 20: Owned Portfolio Overview
Owned Portfolio Overview Percent Wtd Occupied GAAP Percent Wtd Occupied GAAP MSA / Property Name City State Square Feet Leased Percentage (a) Rent (b) MSA / Property Name City State Square Feet Leased Percentage (a) Rent (b) South Region West Region Dallas-Fort Worth Denver Legacy Tennyson Center Pl
Slide 21: Definition of Funds From Operations (“FFO”)
Definition of Funds From Operations (“FFO”) The Company evaluates performance based on Funds From Operations, which we refer to as FFO, as management believes that FFO represents the most accurate measure of activity and is the basis for distributions paid to equity holders. The Company defines FFO
Slide 22: Definition of Adjusted Funds From Operations (“AFFO”)
Definition of Adjusted Funds From Operations (“AFFO”) The Company also evaluates performance based on Adjusted Funds From Operations, which we refer to as AFFO. The Company defines AFFO as (1) FFO, (2) excluding our proportionate share of FFO and including distributions received, from non-consolidat
Slide 23: FFO Reconciliation
FFO Reconciliation (in thousands, except per share amounts) Reconciliation of GAAP Net Income to FFO For the Year Ended December 31, (in thousands): 2013 2014 2015 2016 2017 3/31/2018 Net income (loss) $ 19,827 $ 13,148 $ 35,014 $ 8,378 $ (15,944) $ 1,425 (Gain) loss on sale, less applicable income
Slide 24: AFFO Reconciliation
AFFO Reconciliation (in thousands, except per share amounts) Reconciliation of FFO to AFFO For the Year Ended December 31, Three Months (in thousands): 2013 2014 2015 2016 2017 Ended 3/31/18 Funds From Operations (FFO) $ 100,833 $ 112,462 $ 106,890 $ 106,345 $ 111,437 $ 26,364 Reverse FFO from non-c
Slide 25: Franklin Street Properties Corp.
Franklin Street Properties Corp. Investor Presentation – June, 2018 401 Edgewater Place Investor Relations Contact: Wakefield, MA 01880 Georgia Touma (781) 557-1300 (877) 686-9496 www.fspreit.com InvestorRelations@fspreit.com 24
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