Agree Realty Corporation · NYSE:ADC
Agree Realty — Investor Presentation (November 2016)
28 slides from Agree Realty's investor presentation, Nov 22, 2016
Slide 1: Develop | Acquire | Partner
DEVELOP | ACQUIRE | PARTNER NOVEMBER 2016
Slide 2: Safe Harbor
Safe Harbor This presentation contains certain statements that are the Company’s and Management’s hopes, intentions, beliefs, expectations, or projections of the future and might be considered forward-looking statements under Federal Securities laws. Prospective investors are cautioned that any such
Slide 3: Agree Realty Corporation (NYSE: ADC)
Agree Realty Corporation (NYSE: ADC) Retail net lease REIT focused on growth through the acquisition and development of high-quality retail properties Our Company $1.6 billion retail net lease REIT headquartered in Bloomfield Hills, MI and listed on the NYSE under ticker ADC 347 retail propertie
Slide 4: Recent Highlights
Recent Highlights Consistent execution has led to enhanced shareholder value Announced expanded $350 million credit facility with an accordion up to $500 million Completed October 2016 follow-on equity offering of $101 million, priced at $47.50 per share Invested in 66 high-quality retail net lease
Slide 5: Investment Strategy
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Slide 6: Differentiated Real Estate Investment Strategy
Differentiated Real Estate Investment Strategy Leverage real estate acumen and three investment platforms to identify best risk-adjusted retail net lease opportunities ADC’s synergistic investment platforms adhere to the same core principles while pursuing opportunities along the full spectrum of ne
Slide 7: ADC's Unique Dual Capabilities
ADC’s Unique Dual Capabilities Emphasis on comprehensive real estate solutions drive multi-faceted partnerships DEVELOPMENT SALE-LEASEBACK Spearheading retailer Track record of execution expansion programs for over as acquirer and real estate four decades partner • In-house expertise • Ability t
Slide 8: Track Record of Execution
Track Record of Execution Since 2010, ADC has invested over $900 million in high-quality retail net lease properties Investment Activity $ in millions $300.0 $250.0 $14.9 $220.1 $200.0 $17.7 $150.0 $147.5 $100.0 $28.4 $81.5 $73.3 $50.0 $38.6 $0.0 2011 2012 2013 2014 2015 2016 Acquisitions Developmen
Slide 9: Accelerating Growth
Accelerating Growth Established real estate capabilities and growing market presence driving increased investment opportunities # of Properties Annualized Base Rent (“ABR”) $ in millions 400 $100.0 297 350 $90.0 $90.1 347 300 $80.0 279 250 $70.0 $72.4 200 209 $60.0 $56.5 150 $50.0 130 $45.1 100 109
Slide 10: Active Portfolio Management
Active Portfolio Management Our focus on real estate fundamentals guides non-core asset sales and capital recycling Total Dispositions 2011-2016: $94.3M $15.9M $12.9M $29.0M Chippewa Commons North Lakeland Plaza Columbus, OH Chippewa Falls, WI Lakeland, FL $8.3M $22.7M Plymouth Commons Petoskey Town
Slide 11: Portfolio Summary
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Slide 12: Portfolio Transformation
Portfolio Transformation Execution has led to increased portfolio diversification and improved quality of rental income Property Type (% ABR) Top 3 Tenant Concentration (% ABR) 6% Tenant Ground Leases 70.0% Retail Retail 70.0% Net Lease Net Lease 71% 98% 55.0% Shopping 40.0% Centers 29% 2% 8% 25.0%
Slide 13: Portfolio Transformation
Portfolio Transformation January 2015 November 2016 Pharmacy 29.7% Pharmacy 17.4% Top QSRs 7.5% QSRs 6.9% Sectors Apparel 6.1% Grocery 6.8% 21.9% 12.5% Top Tenants 4.4% 4.7% 4.4% 3.4% # of 209 properties 347 properties Properties Enterprise $0.8 billion $1.6 billion Value As of November 8, 2016. 12
Slide 14: Current Portfolio Snapshot
Current Portfolio Snapshot Tenants Lease Expirations $ in millions $ in millions Annualized $49.3 Tenant / Concept Base Rent (1) % of Total $40.0 $11.3 12.5% 4.2 4.7% $30.0 3.1 3.4% $20.0 2.7 3.0% $10.0 $9.1 $5.7 $6.9 2.6 2.9% $4.3 $2.6 $4.2 $4.9 $0.9 $2.3 $0.0 2.5 2.8% $0.0 2.5 2.7% 2.2 2.5% Retail
Slide 15: National and Super-Regional Retailers
National and Super-Regional Retailers Industry leading brands and retailers operating in e-commerce resistant sectors Retail Tenant Type (% ABR) National 75% z Super-Regional 16% Franchise 9% z z As of November 8, 2016. 14
Slide 16: Leading, Pure-Play Retail Net Lease REIT
Leading, Pure-Play Retail Net Lease REIT Diversified portfolio of high-quality retail properties occupied by superior credit tenants under long-term leases Retail % of Total Portfolio Investment Grade Tenants 100.0% 50.0% 100% 100% 45.0% 47% 85% 45% 75.0% 79% 40.0% 42% 61% 50.0% 54% 35.0% 30.0% 25.0
Slide 17: High-Quality Retail Real Estate = Stronger Residual Values
High-Quality Retail Real Estate = Stronger Residual Values Sunnyvale, California Corporate guarantee from Lowe’s Companies, Inc. (S&P: A-) In the heart of Silicon Valley, only 1.5 miles from Apple’s new corporate headquarters Terrific demographics $127K median household income within a 3-mil
Slide 18: High-Quality Retail Real Estate = Stronger Residual Values
High-Quality Retail Real Estate = Stronger Residual Values Ann Arbor, Michigan Redevelopment of 1937 historic building into flagship campus store Off-market transaction Centrally located on the hard corner directly across from the Diag on the University of Michigan’s Central Campus 3-mile po
Slide 19: High-Quality Retail Real Estate = Stronger Residual Values
High-Quality Retail Real Estate = Stronger Residual Values Lake Zurich, Illinois Completed off-market acquisition from repeat seller Located at signalized intersection within dominant retail corridor Benefits from strong demographics and traffic counts Excellent demographics with $124K media
Slide 20: High-Quality Retail Real Estate = Stronger Residual Values
High-Quality Retail Real Estate = Stronger Residual Values Charlotte, North Carolina Acquisition of ground floor retail condominium Located within downtown Charlotte, near upper income condominium and multi- family developments Small format urban grocery component of a larger mixed-use develop
Slide 21: Development and PCS Projects
Development and PCS Projects Completed seven projects totaling nearly $13 million year-to-date Recently Completed Hobby Lobby Starbucks Wawa Springfield, OH Lakeland, FL Orlando, FL Chick-fil-A Burger King Burger King Family Fare Quick Stop Frankfort, KY Devil’s Lake, ND Farr West, UT Marshall, MI A
Slide 22: Development and PCS Projects
Development and PCS Projects Seven projects under construction for total committed capital of $25 million Under Construction Camping World Orchard Supply Hardware Camping World Georgetown, KY Boynton Beach, FL Tyler, TX Burger King Burger King Burger King Texas Roadhouse Hamilton, MT West Fargo, ND
Slide 23: Representative Acquisitions
Representative Acquisitions Single Tenant Net Lease Lowes KeyBank H-E-B AutoZone Portfolio (14) Concord, NC Elyria, OH Brenham, TX 6 states Multi-Tenant Net Lease Mattress Firm / ULTA Beauty Academy Sports / Jo-Ann / Orscheln Michaels / PetSmart Bed Bath & Beyond / Michaels Columbus, MS Topeka, KS A
Slide 24: Financial Overview
Financial Overview
Slide 25: Capital Structure, Financial Ratios
Capital Structure, Financial Ratios Debt Maturities(1) $ in millions (2) $250.0 $100.0 $100.0 $80.0 $69.0 $60.0 $60.0 $50.0 $50.0 $40.0 $20.0 $25.0 $20.2 $8.6 $8.1 $0.0 $0.0 2016 $0.0 2017 2018 2019 2020 $0.0 2021 $0.0 2022 2023 2024 2025 2026 2027 2028 Revolving Credit Facility Mortgage/Unsecured D
Slide 26: Consistent Performance
Consistent Performance Management is focused on delivering consistent earnings and dividend growth FFO per Share AFFO per Share $2.40 $2.40 $2.39 $2.38 $2.30 $2.30 $2.20 $2.20 $2.22 $2.18 $2.10 $2.10 $2.13 $2.10 $2.09 $2.00 $2.04 $2.00 $1.90 $1.90 2012 2013 2014 2015 2012 2013 2014 2015 Dividends pe
Slide 27: Investment Summary Highlights
Investment Summary Highlights Highest quality retail real estate Most secure cash flows Strongest balance sheet Proven track record of execution Consistent dividend growth Robust growth trajectory 26
Slide 28: Develop | Acquire | Partner
AGREE REALTY CORPORATION DEVELOP | ACQUIRE | PARTNER ADC NYSE