Apartment Investment And Management Company · NYSE:AIV
Apartment Investment And Management — NAREIT REITweek 2011
24 slides from Apartment Investment And Management's conference presentation, Jun 7, 2011
Slide 1: Aimco NAREIT REITweek June 2011
AIMCOApartment Investment and Management Company NAREIT REITWeekJune 2011
Slide 2: Forward-looking statements
2 This presentation contains forward-looking statements within the meaning of the federal securities laws, including statements regarding projected results and specifically forecasts of 2011 financial results. These forward-looking statements are based on management's judgment as of this date and in
Slide 3: Aimco Overview
3 Aimco Overview
Slide 4: Aimco Has a Simple Business Strategy
4 Aimco Has a Simple Business Strategy Own and operate B/B+ quality apartments Well located in 20 largest U.S. markets Opportunistic redevelopmen t Finance with lower risk, property-level, non-recourse, long-dated, fixed- rate and amortizing debt Provide above average risk-adjusted returns
Slide 5: Asset Quality in Aimco's Markets
5 * Represents Aimco average 1Q 2011 rents for all conventional properties held at quarter-end, including same store properties, redevelopment properties and other conventional properties, compared to REIS average for each market. Asset Quality in Aimco's Markets Target B/B+ rents ~100% - 125% Expec
Slide 6: Disciplined Portfolio Management
Excludes casualties and property management expenses.NOI less assumed capital replacement expenditures of $850 per unit. $8.5 billion of sales of lower-rated assets from 2004 through 2010 have improved overall portfolio quality.Average rents ? 42%NOI margin ? 8%Free Cash Flow margin ? 20% Discipline
Slide 7: Leverage Approach and Balance Sheet
* For purposes of this analysis, peer group is comprised of BRE, Camden, Colonial Properties, Equity Residential, Home Properties, Post Properties and UDR, companies that report weighted- average maturity. Data as of 3/31/2011 as reported by SNL Financial. Risks of Leverage Entity risk Repricing ris
Slide 8: Aimco Value Proposition
8 Aimco Value Proposition
Slide 9: Aimco Value Proposition
9 Aimco Value Proposition Apartment demand, driven by favorable, predictable demographics, is strong.Apartment supply is limited and will return slowly as developers restart programs after several years on the sidelines.Favorable demand and supply fundamentals lead to rent growth.Aimco's portfolio a
Slide 10: Apartment Demand is Strong
60% to 70% of people aged 20 to 34 opt for rental housing.*This age cohort is projected to increase by 2.5 million people in the next three years, and 3.5 million over the next five years. * Source: Green Street Advisors Historically, people aged 60 and over have had a propensity to rent of approxim
Slide 11: Jobs Are Returning
Source: Moody's Economy.com.Source: BLS Current Population Survey, May 6, 2011. Represents year-over-year change in the civilian labor force, as defined by the BLS and used in the computation of BLS's unemployment rate. Chart does not refer to nonfarm payroll data.Economist Tom Lawler study results
Slide 12: Apartment Supply is Limited
Long-term average Homeownership is at a 10-year low, but still 1.2% above the long-term average.Every 1% decline in the homeownership rate translates into more than 1 million rental households. New supply remains limited in the short term. Completions are expected to recover by 2013 only to the aver
Slide 13: Projected revenue growth across apartment REITs
* Represents average revenue growth computed by Aimco based on 1) the average of revenue growth projections published by REIS, PPR and AXIOMetrics as of 1Q 2011, and 2) peer market allocation, weighted based on revenues, as reported in 1Q 2011 company reports. Aimco does not endorse or affirm the pr
Slide 14: Aimco is a Reliable Operator
Operating performance exceeds peer average over the last one, three and five years. Aimco is a Reliable Operator 14 Aimco 5-Year CAGR represents only Conventional Same-Store results as data is not available for Total Same Store results for the period. Average of AvalonBay, Camden, Equity Residential
Slide 15: Sustainable Expense Reductions
15 Sustainable Expense Reductions Decreased onsite payroll by centralizing some tasks, improving staffing efficiencies and upgrading onsite technology.Reduced utility costs by investing in more energy efficient systems.Continued appropriate level of spend to maintain properties.Reduced marketing by
Slide 16: Aimco Assets Are of High Quality
Aimco measures asset quality by comparing rents to local market averages.Aimco asset quality in its target markets is slightly above the local market averages. the local market averages. the local market averages. the local market averages. the local market averages. the local market averages. the l
Slide 17: Aimco's Investment Strategy Supports Growth
Aimco's Investment Strategy Supports Growth 17 Match-fund investment activity Aimco makes investment decisions by comparing risk-adjusted, unlevered Free cash Flow Internal Rates of Return (FCF IRR).Aimco also considers factors such as market timing and target portfolio allocations.Semi-annually, Ai
Slide 18: Aimco Share Price Lags Aimco Improvements
By all measures, Aimco is a stronger company today.However, when compared to peers and to historical valuations, Aimco shares traded at a greater discount during 2010 than they did during 2005, which discount has widened further year-to-date 2011. Aimco Conventional Portfolio Average rents NOI margi
Slide 19: Aimco's Results Have Improved More Than Peer Group
Measure (1) Average rents NOI margin G&A as a % of property revenues Aimco + 30% + 8% - 17% Peer Median (2) + 19% + 1% - 1% Data Sources: Company reports; SNL Financial Operating statistics for Aimco's conventional portfolio.Peer group comprised of AvalonBay, BRE, Camden, EQR, Home Properties, Post
Slide 20: Mid-Quarter Update
20 Mid-Quarter Update
Slide 21: Property Operations On Track
21 Property Operations On Track Aimco's focus is NOI growth, which takes into consideration the balance between rate, occupancy levels and turnover costs.Turnover remains at approximately 33%.
Slide 22: Balance Sheet Progress on Plan
22 Balance Sheet Progress on Plan Freddie Mac Refinancing & Securitization Freddie Mac refinanced 19 separate property loans.New loans total $674 million at an average interest rate of 5.49%, on a 30-year amortization schedule, with a 10-year maturity. Increased weighted average maturity of previous
Slide 23: Analyst commentary on Aimco
23 Morgan Stanley REIT Initiation: Aimco is "priced for the last cycle, not the current one".AIMCO's relative valuation is weighed down by perceptions regarding weak apartment portfolio quality that do not fully reflect the enhancements produced by non-core dispositions in recent years (trimming fro
Slide 24: Earnings and Dividend
24 Earnings and Dividend Aimco's opportunity for dividend increases is greater than peers due to higher AFFO growth rate and current low payout ratio. * Excluding impact of $0.14 of charges in 2011 associated with Freddie Mac refinancing and securitization announced by Aimco on May 20, 2011. Green S
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