First Industrial Realty Trust, Inc. · NYSE:FR
First Industrial Realty Trust — J.P. Morgan SMid Cap Conference 2013
28 slides from First Industrial Realty Trust's conference presentation, Dec 11, 2013
Slide 1: First Industrial Realty Trust Investor Presentation
First Industrial Realty Trust Investor Presentation Scott Musil, Chief Financial Officer J.P. Morgan SMid Cap Conference | December 11, 2013
Slide 2: Safe Harbor
Safe Harbor This presentation contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking
Slide 3: First Industrial Realty Trust: Overview
First Industrial Realty Trust: Overview • NYSE: FR • Owner, operator and developer of industrial real estate across the U.S. • Equity Market Capitalization: $2 billion • Total Market Capitalization: $3.4 billion • Dividend Yield: 2% Capitalization figures and dividend yield reflect closing stock pri
Slide 4: Broad Platform and Presence
Broad Platform and Presence Seattle Minneapolis Milwaukee Central & Detroit Eastern PA New Jersey Chicago Salt Lake City Cleveland Indianapolis Balt/Wash Denver Cincinnati St. Louis Nashville Southern California Phoenix Atlanta Dallas % of Rental Top 5 Markets Income Houston So. California 9.7% Tamp
Slide 5: Where We've Been… 2009 – 2010
Where We’ve Been… 2009 – 2010 • Addressed liquidity and maturities • Redefined strategy • Rationalized G&A • Set the stage for portfolio refinement Minneapolis, MN (285,000 SF – Acquired 2010) 5
Slide 6: Where We've Been… 2011 – To-Date
Where We’ve Been… 2011 – To-Date • Drove occupancy and NOI Occupancy increased 620 bps since YE 2010 • Strengthened balance sheet • Implemented “Addition by Subtraction” • Initiated selective growth • Re-initiated common dividend $0.34/share per annum rate Central PA (390,000 SF – Acquired 2012) 6
Slide 7: Where We've Been… Key Portfolio Cash Flow Metrics
Where We’ve Been… Key Portfolio Cash Flow Metrics Occupancy %(1) Cash Rental Rates %(2) (FY) Same Store NOI % (FY) 100 5 10 0 6.3 2009 2010 2011 2012 YTD13 91.2 89.9 5 -2.8 87.9 -5 -4.7 2.5 85.0 -6.9 -10 0.1 82.0 0 -11.8 2009 2010 2011 2012 YTD13 -15 -15.1 -2.7 75 -3.8 2009 2010 2011 2012 3Q13 -5 -2
Slide 8: Where We've Been… Capital Management Progress
Where We’ve Been… Capital Management Progress (millions) $2,500 ■ Preferred Stock ■ Net Debt $2,309 Net Debt(1) & Pref. Stock/ EBITDA(2) 11.1x $2,000 $1,741 Net Debt(1) & Pref. Stock/ EBITDA(2) 8.6x $1,500 $1,397 Net Debt(1) & Pref. Stock/ EBITDA(2) 6.7x Debt/Total Debt/Total Debt/Total Assets(3) As
Slide 9: Upgrading the Portfolio
Upgrading the Portfolio FR Portfolio – Assets Book Value $2.9B (3Q10) GAAP Yield/ LTM Sales Cap Rate + Investments 2010+ = $337M(1) 12% Increase 6.7% - Dispositions 4Q10+ = $249M 9% Decrease 5.8% Total Portfolio Change $586M = 21% Net Change (1) Reflects full development cost of First 36 and First F
Slide 10: Favorable Industry Fundamentals
Favorable Industry Fundamentals U.S. Industrial Real Estate Annual Completions/Net Absorption (MSF) 400 ■ Completions ■ Net Absorption 300 200 Forecast 100 - 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 (100) (200) (300)
Slide 11: Where We're Going… Strategy for Success
Where We’re Going… Strategy for Success Leasing and Operations Capital Portfolio Management Management Management • Drive to +95% by YE 2015 • Conservative and Flexible • Selective Acquisitions • Grow Rents Balance Sheet • Targeted Development • Normalize TI/LC/CapEx • Return to Investment Opportuni
Slide 12: Growing Cash Flow, Delivering Value
Growing Cash Flow, Delivering Value Recap from Investor Day November 12, 2013 Cumulative Cash Flow Potential 2014 – 2017 $M Balance Sheet 4.0 to 10.0 Small Tenant Opportunity, Bumps, TI/LC/CapEx 29.0 to 36.0 Key Bulk and Additional Opportunities East Region 6.0 to 7.0 Central Region 5.0 to 6.0 West
Slide 13: The Balance Sheet: Cumulative Cash Flow Opportunities (2014 – 2017)
The Balance Sheet Cumulative Cash Flow Opportunities (2014 – 2017) Debt Amount Average Rate Potential Savings If Refinanced: Year 3Q13 ($M)(1) (%) @ 5.5% ($M) @ 4.5% 2014 125 6.56 1.3 2.6 2015 23 5.58 0.0 0.2 2016 238 6.15 1.5 3.9 2017 157 6.49 1.6 3.1 Cumulative $543M 6.32% $4.4M $9.8M (1) Excludes
Slide 14: Portfolio Cash Flow Opportunities by 2017
Portfolio Cash Flow Opportunities by 2017(1) Small Tenant Leasing $8 to $9M Bumps $14 to $19M TI/LC/CapEx (annual) $7 to $8M Total Potential Impact $29 to $36M Potential Rental Rate Growth TBD (1) Assumes no additional sales or acquisitions. 14
Slide 15: Small Tenant Occupancy and Cash Flow Opportunity
Small Tenant Occupancy and Cash Flow Opportunity(1) The Path to +95% Average 9/30/13 Target In-place Incremental 9/30/13 Occupancy Occupancy Net Rent Cash Flow Property Type MSF % % ($/SF) ($M)(2) Bulk Warehouse 35.4 93.1 96.0 Regional Warehouse 8.2 92.1 96.0 4.30 1.9 Light Industrial 14.8 88.2 92.0
Slide 16: Rental Rate Bumps
Rental Rate Bumps(1) Historical and Embedded Bumps 2013 Trends Amount • 50% of all leases have bumps averaging 4.2% Year ($M) 2011 6.4 • 71% of leases signed (12+ mos.) contained bumps 2012 6.8 averaging 2.7% annualized 2013 5.1 2014 4.8 2015 4.0 2017 Potential Impact $M Change ($M) 2016 3.3 3Q13 NO
Slide 17: The TI/LC/CapEx Opportunity
The TI/LC/CapEx Opportunity (millions) ■ 2011-17 CapEx ■ 2011-17 TI/LC $50 $40 $30 Assumptions:(1) • 92% YE Occ. $20 • 9/30/13 expiration schedule • 4-yr lease term • 70% retention $10 • 95% Occ. YE15 • $0.25/SF in CapEx $0 2011 2012 2013 YTD 2011-13 Average 2014-17 Average Annualized (1) Uses avera
Slide 18: U.S. Market Rent Recovery
U.S. Market Rent Recovery $/SF Torto Wheaton Warehouse Rent Annual Index 7 Previous Peak 6 5 Previous Bottom 4 3 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Source: CBRE Econometric Advisors (CBRE-EA) 3Q 2013 18
Slide 19: Key Bulk and Additional Opportunities by 2017
Key Bulk and Additional Opportunities by 2017(1) Cumulative Cash Flow Potential 2014 – 2017 $M East Region 6.0 to 7.0 Central Region 5.0 to 6.0 West Region 8.5 to 9.5 Total $19.5 to $22.5M (1) Assumes no additional sales or acquisitions. 19
Slide 20: Drive to +95%! Ten Key Bulk Opportunities
Drive to +95%! Ten Key Bulk Opportunities Total Potential Annual Market Property Vacant SF Cash Flow ($M) Los Angeles First Dominguez Gateway Center 213,544 2.4 Chicago 9501 Nevada 118,670 1.4 Atlanta 596 Bonnie Valentine 212,525 0.7 Central & Eastern PA 18212 Shawley 150,000 0.7 Central & Eastern P
Slide 21: Additional Opportunities – East
Additional Opportunities – East Total Potential Market Property SF Annual Cash Flow ($M) Central & Eastern PA First Logistics Center @ I-83 708,000 2.9 Central & Eastern PA First 33 Commerce Center 584,000 TBD Central & Eastern PA Covington Land 502,000 TBD TOTAL $2.9M 21
Slide 22: New Acquisitions and Additional Opportunities – Central
New Acquisitions and Additional Opportunities– Central Total Potential Market Property SF Annual Cash Flow ($M) New Acquisitions - Leased Chicago I-94 Distribution Center 626,784 1.9 Additional Opportunities Chicago 4100 Rock Creek 509,216 1.4 Chicago Rust-Oleum Expansion 250,000 0.6 Houston First N
Slide 23: Additional Opportunities – West
Additional Opportunities – West Total Potential Market Property SF Annual Cash Flow ($M) Southern California First Bandini Logistics Center 489,000 3.5 Southern California First 36 Logistics Center 555,000 2.2 Southern California First Figueroa Logistics Center 43,000 0.3 Southern California First N
Slide 24: First Bandini Logistics Center • Southern California
First Bandini Logistics Center • Southern California Summary Square Feet: 489,000 Estimated Investment: $54M Estimated GAAP Yield: 6.5% Completion Date: 3Q13 Potential NOI Impact: $3.5M 24
Slide 25: First Logistics Center @ I-83 • Central & Eastern Pennsylvania
First Logistics Center @ I-83 • Central & Eastern Pennsylvania Summary Square Feet: 708,000 Estimated Investment: $34M Estimated GAAP Yield: 8.4% Completion Date: 4Q13 Potential NOI Impact: $2.9M 25
Slide 26: The First Industrial Opportunity: Growing Cash Flow, Delivering Value
The First Industrial Opportunity Growing Cash Flow, Delivering Value Cumulative Cash Flow Potential 2014 – 2017 $M Balance Sheet 4.0 to 10.0 Small Tenant Opportunity, Bumps, TI/LC/CapEx 29.0 to 36.0 Key Bulk and Additional Opportunities East Region 6.0 to 7.0 Central Region 5.0 to 6.0 West Region 8.
Slide 27: The First Industrial Opportunity: Current Valuation
The First Industrial Opportunity Current Valuation Public Market Valuation Summary(1) FR DCT EGP Occupancy 91.2% 92.8% 95.7% Square Feet (M) 62.0 62.2 32.3 Shares Outstanding (M) 115 335 31 11/29/13 Closing Price $17.46 $7.46 $60.59 Equity Capitalization ($B) 2.1 2.6 1.9 Debt + Preferred Stock ($B)
Slide 28: Q&A
Q&A J.P. Morgan SMid Cap Conference | December 11, 2013
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