Cto Realty Growth, Inc. · NYSE:CTO
Cto Realty Growth — Consolidated Tomoka Land — Q2 2019 Earnings Presentation
55 slides from Cto Realty Growth's earnings presentation, Jul 17, 2019
Slide 1: 2nd Quarter 2019 Investor Presentation: Focused on Growth
NYSE American: CTO 2nd QUARTER 2019 INVESTOR PRESENTATION FOCUSED ON GROWTH CARPENTER HOTEL, AUSTIN, TX 93 ROOMS HOBBY LOBBY, WINSON SALEM, NC 55,000 SF FAMILY DOLLAR, LYNN, MA 9,228 SF WALGREENS, BIRMINGHAM, AL 14,516 SF WALGREENS, ALBANY, GA 14,770 SF 24 HOUR FITNESS, FALLS CHURCH, VA 46,000 SF
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS CONSOLIDATED TOMOKA If we refer to “we,” “us,” “our,” or “the Company,” we mean Consolidated-Tomoka Land Co. and its consolidated subsidiaries. Certain statements contained in this presentation (other than statements of historical fact) are forward-looking statements. Word
Slide 3: CTO Snapshot
CTO SNAPSHOT CONSOLIDATED TOMOKA As of July 15, 2019 (unless otherwise noted) Portfolio Quality Organic Capital Source Discount to NAV 3 INCOME PROPERTIES 51 15 2.3mm $33.2mm STATES SQUARE FEET ANNUALIZED NOI (C) TOTAL ACRES REMAINING 5,300+ 3,000 $175.0mm ACRES UNDER CONTRACT (A) TOTAL ESTIMATED
Slide 4: Q2 2019+ Highlights
Q2 2019+ HIGHLIGHTS CONSOLIDATED TOMOKA Continuing to Execute Our Strategy 4 MONETIZING LAND HARVEST MULTI-TENANT REDEPLOY PROCEEDS INTO SINGLE-TENANT RETAIL TOTAL SALES PRICE: $7.5mm (64.3 acres) PRICE PER ACRE: $117,000 GAIN: $2.9mm ($0.44/share, net of tax) TOTAL SALES PRICE: $55.3mm GAIN: $11.8m
Slide 5: Track Record of Strong Operating Results
’14 – ’18 CAGR 29% ’14 – ’18 CAGR 52% ’14 – ’18 CAGR 50% ’14 – ’18 CAGR 16% ($000’s) TRACK RECORD OF STRONG OPERATING RESULTS CONSOLIDATED TOMOKA Annual Results for 2013 –2018, YTD as of Q2 for 2019 ($000’s) Consistent Growth in Key Metrics (1) Basic Earnings per Share including from discontinued op
Slide 6: CTO Snapshot: A Lot More Income than Land
CTO SNAPSHOT CONSOLIDATED TOMOKA A Lot More Income than Land Percentages based on values derived on NAV worksheet on Slide #8 51 Properties 2.3 million Sq. Ft. Retail and Office NOI $33.2 million (C) Subsurface Interests >450,000 Acres 5,300 Total Acres 3,014 Acres (57%)(A) Under Contract for $
Slide 7: Diversified CTO Shareholder Base
DIVERSIFIED CTO SHAREHOLDER BASE CONSOLIDATED TOMOKA No Shareholder Owns > 7% of CTO’s Outstanding Shares As of June 30, 2019 7 BlackRock Fund Advisors 6.7% Dimensional Fund Advisors LP 5.9% The Vanguard Group, Inc. 4.6% Fidelity Management & Research Co. 1.8% Carlson Capital LP 3.3% Intrepid Capita
Slide 8: NAV Worksheet
NAV WORKSHEET (A)(F) CONSOLIDATED TOMOKA Indicative of Meaningful Discount in our Stock Price 8 Cap Rate on NOI (C) Contract amounts As of July 15, 2019 As of June 30, 2019 Reflects repurchase of 320,741 shares from CTO’s largest shareholder on 4/10/19 Excludes intangible lease liabilities As of Jul
Slide 9: Implied Value of Land
IMPLIED VALUE OF LAND CONSOLIDATED TOMOKA Our Current Stock Price Implies Heavily Discounted Value for Land 9 As of July 15, 2019 (unless otherwise noted) Cap Rate Sensitivity Applied to Income Property NOI 6.0% 6.5% 7.0% Equity Market Cap $ 297,505,115 $ 297,505,115 $ 297,505,115 Debt $ 289,100,000
Slide 10: Momentum Monetizing Land
MOMENTUM MONETIZING LAND (A) CONSOLIDATED TOMOKA Extensive Visibility to Value of Our Land 11 45 Closed Transactions Since 2012 As of July 15, 2019 Closed Transaction Under Contract (A) Acres Sales Price Average Price/Acre East of I-95 795 135,820 $ 170.9 $ West of I-95 7,641 111,712 $ 14.6 $ Total
Slide 11: Pipeline of Potential Land Sales
PIPELINE OF POTENTIAL LAND SALES(A) As of July 15, 2019 SF –Single Family; AR –Age Restricted, MF – Multi-Family MOB – Medical Office Bldg. Substantial Pipeline of Organic Capital for Growth to Income CONSOLIDATED TOMOKA 12 9 DIFFERENT BUYERS 57% of Remaining Land Contract/Parcel Acres Contract Amou
Slide 12: Income Property Investments
INCOME PROPERTY INVESTMENTS Converting into Income ($000’s) Total Acquisitions for 2011 – 2018, YTD 2019 and Est. for Remainder of 2019 (J) Diversified Markets Higher Quality Properties Net of master tenant purchase contribution of $1.5 million for acquisition of income property in Aspen, CO in Q1 2
Slide 13: Single-Tenant Retail Investment: Winston Salem, NC
SINGLE-TENANT RETAIL INVESTMENT CONSOLIDATED TOMOKA Long Term Lease Strong Retail Corridor 14 Single Tenant Retail 7.6 Acres 11 year Lease Term Rent Escalations every 5 yrs. Year Built 2015 Investment basis $147/SF Acquisition Cap Rate 6.30% Investment $8.1 Million 11 Year NNN Lease 55,000 Square Fe
Slide 14: Single-Tenant Retail Investment: Falls Church, VA
SINGLE-TENANT RETAIL INVESTMENT CONSOLIDATED TOMOKA Strong Demographics Infill Location 15 Single Tenant Retail 3.09 Acres 8+ year Lease Term Rent Escalations every 5 yrs. Renovated 2012 6 miles from the Pentagon FAR estimated at 3.0x – ability to develop 400k sf of density and approved for multiple
Slide 15: Single-Tenant Retail Investment: Birmingham, AL
SINGLE-TENANT RETAIL INVESTMENT CONSOLIDATED TOMOKA Hard Corner High Visibility Location 16 Single Tenant Retail 2.05 Acres 9+ year Lease Term Built in 2003 Investment Grade Tenant Acquisition Cap Rate 6.62% Investment $5.5 Million 9+ Year NNN Lease 14,516 Square Feet Acquired June 2019 Birmingham,
Slide 16: Single-Tenant Retail Investment: Lynn, MA
SINGLE-TENANT RETAIL INVESTMENT CONSOLIDATED TOMOKA Dense Infill Location Strong Demographics 17 Single Tenant Retail 0.67 Acres 4.8 year Lease Term Built in 2014 Rent Escalation at Renewal Acquisition Cap Rate 7.44% Investment $2.1 Million ≈5 Year NNN Lease 9,228 Square Feet Acquired June 2019 Lynn
Slide 17: Single-Tenant Retail Investment: Albany, GA
SINGLE-TENANT RETAIL INVESTMENT CONSOLIDATED TOMOKA Hard Corner High Visibility Location 18 Single Tenant Retail 3.55 Acres 13.6 year Lease Term Built in 2008 Investment Grade Tenant Walgreens acquired nearby Rite-Aid location and closed in favor of this property Acquisition Cap Rate 7.10% Investmen
Slide 18: Single-Tenant Ground Lease Investment: Austin, TX
SINGLE-TENANT GROUND LEASE INVESTMENT CONSOLIDATED TOMOKA High Growth Market Strong Demographics 19 Single Tenant Ground Lease 93 Rooms 5.28 Acres 99 year Lease Term Annual Rent Escalations Percentage Rent based on NOI hurdle Built in 1949/2018 Discount to replacement cost Acquisition Cap Rate 5.75%
Slide 19: Single-Tenant Office Investment: Reston, VA
SINGLE-TENANT OFFICE INVESTMENT CONSOLIDATED TOMOKA Major MSA Strong Demographics 20 Single Tenant Office 2.98 Acres 9.9 year Lease Term Annual Rent Escalations Built in 1984, renovated 2001/2018 Subsidiary of One of Largest Defense Contractors globally $17 million Renovation in 2018 Close proximity
Slide 20: Recycling Capital into Single-Tenant
RECYCLING CAPITAL INTO SINGLE-TENANT CONSOLIDATED TOMOKA Sales Price $24.6 million MULTI-TENANT PROPERTY Sales Price/Sq. Ft.: $415 Harvesting Value Redeploying Capital 21 Monetize Multi-Tenant Property – Redeploy Proceeds into Single-Tenant Retail Jacksonville, FL CAP RATE: 5.98% Purchase Price: $32
Slide 21: Recycling Capital into Single-Tenant
RECYCLING CAPITAL INTO SINGLE-TENANT CONSOLIDATED TOMOKA Sales Price: $18.3 million Winter Park, FL MULTI-TENANT PROPERTY Harvesting Value Redeploying Capital 22 Monetize Multi-Tenant Property – Redeploy Proceeds into Single-Tenant Retail Falls Church, VA CAP RATE: 6.53% Purchase Price: $21.3 millio
Slide 22: Recycling Capital into Single-Tenant
RECYCLING CAPITAL INTO SINGLE-TENANT CONSOLIDATED TOMOKA Sales Price: $37.0 million Santa Clara, CA MULTI-TENANT PROPERTY Harvesting Value Redeploying Capital 23 Monetize Multi-Tenant Property – Redeploy Proceeds into Single-Tenant Retail and Office CAP RATE: 6.28% Aggregate Purchase Price: $34.9 mi
Slide 23: Portfolio Highlights: Stronger Markets, Stronger Credits
PORTFOLIO HIGHLIGHTS CONSOLIDATED TOMOKA Stronger Markets Stronger Credits 24 (% = as a % of Total NOI) As of July 15, 2019 Total Square Feet (2) Investment Grade Tenants (H) ≈2.3 13% States 15 Total Properties Annualized NOI (1) (C) 51 $33.2 Single Tenants >10% of NOI (C) 2 Geographic Diversity (1)
Slide 24: Portfolio Highlights: >80% Single-Tenant
PORTFOLIO HIGHLIGHTS As of July 15, 2019 CONSOLIDATED TOMOKA >80% of Portfolio is Single-Tenant 25 Portfolio Mix Annual NOI (C) ≈$33.2mm Wgtd. Avg. Lease Term 11.3 yrs. (1) 15 States Square Feet ≈2.3mm High Quality & Diversified Portfolio (% = as a % of Total NOI) (1) Weighted average for Single-Ten
Slide 25: Top Tenants Versus Peers
TOP TENANTS VERSUS PEERS CONSOLIDATED TOMOKA Which Would You Rather Own? 26 BBB 3.4% BBB- 3.2% BBB 3.0% BBB 2.6% B- 5.4% 8.9 45% 63%/37%/0% Premium 0% Stock Price vs NAV(1)(4) Avg. Lease Term (1)(4) Leverage Level (1) (4) Retail/Office/Other (4) 14.0 30% 83%/17%/0% Premium 33% B+ 2.4% NR 1.7% NR 1.6
Slide 26: How CTO's Portfolio Stacks Up
HOW CTO’S PORTFOLIO STACKS UP CONSOLIDATED TOMOKA Stronger Demographics = Better Markets & Long-Term Real Estate 27 Three Mile Population(1)(3) Implied Cap Rate(2) 3-Mile Avg. Household Income(1)(3) CTO info as of Q2 2019 Peer implied cap rates info from Janney Montgomery Scott LLC as of July 15, 20
Slide 27: Opportunity to Be Noticed
OPPORTUNITY TO BE NOTICED CONSOLIDATED TOMOKA Stronger Demographics = Better Markets & Long-Term Real Estate 28 2% CTO 31% O 28% VER 52% EPRT 27% STOR 26% NNN 24% ADC
Slide 28: Commercial Loan Investments
COMMERCIAL LOAN INVESTMENTS CONSOLIDATED TOMOKA As of July 15, 2019 Short Duration High Risk Adjusted Yields High Growth Markets 29 $8.0mm Loan Type: First Mortgage Loan - Secured Security: 72 +/- acre land parcel Location: Orlando, FL Rate: 12% Fixed Fees (Origination/Exit): 2.0%/0.50% Maturity: Ju
Slide 29: Liquidity & Leverage
LIQUIDITY & LEVERAGE CONSOLIDATED TOMOKA Net Debt to TEV ≈ 45% Fixed Rate Debt ≈ 45% Unsecured Debt ≈ 81% Weighted Average Rate = 3.97% Average Duration 4.1 years As of July 15, 2019 (unless otherwise noted) Debt Schedule (E) ($ in millions) Liquidity Position ($ in 000’s) Total Commitment of Credit
Slide 30: Returning Capital to Shareholders: Share Buybacks
RETURNING CAPITAL to SHAREHOLDERS (B)(D) CONSOLIDATED TOMOKA Annual Investments From 2013 Through 2018, and YTD as of 7/15/19 Consistent Approach Accretive to NAV 31 Share Buybacks(B)(D) Includes repurchase of 320,741 shares on 4/10/19 from CTO’s largest shareholder, which was completed outside of t
Slide 31: Returning Capital to Shareholders: Dividends
RETURNING CAPITAL to SHAREHOLDERS CONSOLIDATED TOMOKA 2012 Through Q3 2019 Disciplined Approach to Returning Capital 32 INCREASING DIVIDEND + PAID QUARTERLY Dividends(G) Cumulative % increase in Dividend 50% 75% 100% 200% 350% 575% Note: Based on Q3 2019 dividend of $0.11 per share approved 7.17.19
Slide 32: 2019 Guidance
2019 GUIDANCE CONSOLIDATED TOMOKA Monetizing Land Growing Free Cash Flow Recycling Capital 33 FY2019 Guidance YTD 2019 Actual Earnings Per Share (Basic) (1)(2) $6.75 - $7.50 $0.58 Incremental EPS (Basic) From Dispositions $2.25 - $2.75 $2.74 Acquisition of Income-Producing Assets (3) $80mm - $120mm
Slide 33: Appendix
CONSOLIDATED TOMOKA 34 APPENDIX
Slide 34: Single-Tenant Portfolio
CONSOLIDATED TOMOKA (1) Two properties Single-Tenant Portfolio (C) APPENDIX 35 As of July 15, 2019 (C) Lease contains rent escalations Tenant/Building S&P Credit Rating Location Property Type Rentable Square Feet Remaining Lease Term % of NOI Fidelity N/A Albuquerque, NM Office 210,067 9.4 10.3% Wel
Slide 35: Single-Tenant Portfolio (continued)
CONSOLIDATED TOMOKA Single-Tenant Portfolio (C) APPENDIX 36 As of July 15, 2019 (C) Lease contains rent escalations Tenant/Building S&P Credit Rating Location Property Type Rentable Square Feet Remaining Lease Term % of NOI Big Lots BBB- Glendale, AZ Retail 34,512 3.5 1.1% Walgreens BBB Birmingham,
Slide 36: Multi-Tenant Portfolio
CONSOLIDATED TOMOKA Multi-Tenant Portfolio APPENDIX 37 (C) As of July 15, 2019 (C) Lease contains rent escalations Tenant/Building S&P Credit Rating Location Property Type Rentable Square Feet Remaining Lease Term NOI % of NOI 245 Riverside Ave N/A Jacksonville, FL Office 136,856 2.7 $2,089,000 6.3%
Slide 37: Top Income Property: Albuquerque, New Mexico
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 38 As of July 15, 2019 Albuquerque, New Mexico Asset Type Single-Tenant Office Tenant Fidelity Real Estate S&P Rating NR % of Portfolio NOI 10.3% Square Feet 210,067 Acres 25.34 Remaining Term 9.4 Year Built 2009 Purchase Date Oct 2018 Occupancy 10
Slide 38: Top Income Property: Hillsboro, Oregon
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 39 As of July 15, 2019 Hillsboro, Oregon Asset Type Single-Tenant Office Tenant Wells Fargo Bank, N.A. S&P Rating A+ % of Portfolio NOI 9.5% Square Feet 211,863 Acres 18.92 Remaining Term 6.5 Year Built 1978/2009 Purchase Date Oct 2017 Occupancy 10
Slide 39: Top Income Property: Raleigh, North Carolina
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 40 As of July 15, 2019 Raleigh, North Carolina Asset Type Single-Tenant Office Tenant Wells Fargo Bank, N.A. S&P Rating A+ % of Portfolio NOI 8.3% Square Feet 450,393 Acres 40.56 Remaining Term 5.2 Year Built 1996/1997 Purchase Date Nov 2015 Occupa
Slide 40: Top Income Property: Jacksonville, Florida
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 41 As of July 15, 2019 Jacksonville, Florida Asset Type Multi-Tenant Office Tenant Raymond James Northwestern Mutual S&P Rating NR % of Portfolio NOI 6.3% Square Feet 136,856 Acres 3.40 Remaining Term 2.7 Year Built 2003 Purchase Date Jul 2015 Occu
Slide 41: Top Income Property: Orlando, Florida
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 42 As of July 15, 2019 Orlando, Florida Asset Type Single-Tenant Office Tenant Hilton Grand Vacations S&P Rating BB+ % of Portfolio NOI 5.4% Square Feet 133,914 Acres 14.84 Remaining Term 7.4 Year Built 1988/2000 Purchase Date Jan 2013 Occupancy 10
Slide 42: Top Income Property: Falls Church, Virginia
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 43 As of July 15, 2019 Falls Church, Virginia Asset Type Single-Tenant Retail Tenant 24-Hour Fitness S&P Rating NR % of Portfolio NOI 4.2% Square Feet 46,000 Acres 3.09 Remaining Term 8.5 Year Built 2012 Purchase Date May 2019 Occupancy 100% Demogr
Slide 43: Top Income Property: Aspen, Colorado
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 44 As of July 15, 2019 Aspen, Colorado Asset Type Single-Tenant Retail Tenant A.G. Hill S&P Rating NR % of Portfolio NOI 3.9% Square Feet 19,596 Acres n/a Remaining Term 18.6 Year Built 2015 Purchase Date Feb 2018 Occupancy 100% Demographics 3-mile
Slide 44: Top Income Property: Reston, Virginia
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 45 As of July 15, 2019 Reston, Virginia Asset Type Single-Tenant Office Tenant General Dynamics subsidiary % of Portfolio NOI 3.5% Square Feet 64,319 Acres 2.98 Remaining Term 9.9 Year Built 1984/2001/2018 Purchase Date Jul 2019 Occupancy 100% Demo
Slide 45: Top Income Property: Austin, Texas
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 46 As of July 15, 2019 Austin, Texas Asset Type Single-Tenant Ground Lease Tenant Carpenter Hotel % of Portfolio NOI 2.8% Hotel Size 93 Rooms Acres 5.28 Remaining Term 99.0 Year Built 1949/2018 Purchase Date Jul 2019 Demographics 3-mile Population
Slide 46: Top Income Property: Katy, Texas
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 47 As of July 15, 2019 Katy, Texas Asset Type Single-Tenant Retail Tenant Lowe’s S&P Rating BBB+ % of Portfolio NOI 2.8% Square Feet 131,644 Acres 15.48 Remaining Term 7.5 Year Built 1997 Purchase Date Apr 2014 Occupancy 100% Demographics 3-mile Po
Slide 47: The Map
APPENDIX CONSOLIDATED TOMOKA The Map 48
Slide 48: Active Adult Community Development on Land Sold by CTO
APPENDIX CONSOLIDATED TOMOKA > 800 Homes Sold Since Opening in Q4 2017 Active Adult Community – 3,400 Total Homes Planned Development in Progress on Land Sold by CTO 49 Commercial/Retail Development LPGA Blvd New Phases Amenities Under Construction
Slide 49: Tomoka Pointe Rental Community
APPENDIX CONSOLIDATED TOMOKA At Tomoka Town Center 276-Unit Luxury Rental Community Development in Progress on Land Sold by CTO 50 Estimated Projected Costs $39 million Opened Q2 2019 Tomoka Pointe
Slide 50: Membership Wholesale Club Development
APPENDIX CONSOLIDATED TOMOKA Membership Wholesale Club Only New Development of Sam’s Club in U.S. Development in Progress on Land Sold by CTO 51 Scheduled to Open July 2019
Slide 51: New Distribution Center & HQ Office
APPENDIX CONSOLIDATED TOMOKA New Distribution Center & New HQ Office Last Mile Distribution Center for Amazon Development in Progress on Land Sold by CTO 52 Future Home of Costa Del Mar
Slide 52: New Multi-Family Location East
APPENDIX CONSOLIDATED TOMOKA New Multi-Family Location 500 East: 300 Unit Multi-Family Property 53 Development in Progress on Land Sold by CTO LPGA Blvd
Slide 53: Self Storage Property Development
APPENDIX CONSOLIDATED TOMOKA Williamson Blvd. & Mason Avenue Self Storage Property 54 Development in Progress on Land Sold by CTO
Slide 54: End Notes
END NOTES CONSOLIDATED TOMOKA 55 End Notes references utilized in this presentation There can be no assurances regarding the value ultimately received for the Company’s assets, or in the case of the transactions under contract, the likelihood that such transactions will close or the timing or final
Slide 55: Contact Us
CARPENTER HOTEL, AUSTIN, TX 93 ROOMS HOBBY LOBBY, WINSON SALEM, NC 55,000 SF FAMILY DOLLAR, LYNN, MA 9,228 SF WALGREENS, BIRMINGHAM, AL 14,516 SF WALGREENS, ALBANY, GA 14,770 SF 24 HOUR FITNESS, FALLS CHURCH, VA 46,000 SF NYSE American: CTO 2nd QUARTER 2019 INVESTOR PRESENTATION FOCUSED ON GROWTH 11
Consolidated Tomoka Land — Q2 2019 Earnings Presentation on 6ix