Independence Realty Trust, Inc. · NYSE:IRT
Independence Realty Trust — Investor Presentation (June 2018)
26 slides from Independence Realty Trust's investor presentation, Jun 4, 2018
Slide 1: Investor Presentation June 2018
2.60 1.80 2.15 3.30 3.75 5.10 0.15 5.10 4.50 - logo 0.15 Investor Presentation June 2018 0 34 84 18 86 154 108 134 195 82 89 95 191 191 191 241 229 24 33 75 35 255 175 25 Exhibit 99.1
Slide 2: Table of Contents
Table of Contents IRT Overview 2 – 3 Markets 4 – 5 Assets 6 Portfolio 7 – 9 Value Add 10 – 11 Capital Structure 12 – 13 Guidance 14 Conclusion 15 Appendix Demographic Profile 17 Market Profiles 18 – 22 Definitions and Non-GAAP Financial Measure Reconciliations 23 – 24 Forward-Looking Statement 25
Slide 3: Positioned to Unlock Long-term Value
Positioned to Unlock Long-term Value Clear investment strategy focused on middle-market communities across non-gateway MSAs Accretive, tenant-first approach to owning and operating high-quality multifamily communities $ Value add community redevelopment and capital recycling initiatives Simple, cons
Slide 4: Clear Investment and Ownership Strategy
Clear Investment and Ownership Strategy Assets Our Focus: Well-located middle-market communities, likely to benefit from IRT’s: Robust management platform Operational expertise Economies of scale Markets Our Focus: Targeted Submarkets within Non-Gateway Markets exhibiting: Strong apartment demand Li
Slide 5: Population growth in IRT's markets is above the national average
Population growth in IRT’s markets is above the national average and is growing faster than new supply, creating increased demand for existing apartment units. Migration Outpacing New Supply Projected Net Migration / Projected Completions Population Growing at a Higher Rate in IRT’s Markets Represen
Slide 6: Job growth in IRT's markets is above the national average
Job growth in IRT’s markets is above the national average and is growing faster than new supply, creating increased demand for existing apartment units. Job Growth Outpacing New Supply Employment Growing at a Higher Rate in IRT’s Markets Projected Jobs / Projected Completions Represents the number o
Slide 7: Our Assets Demonstrate Attractive Apartment Industry Dynamics
Low Homeownership Limited New Supply The national Class B vacancy rate remains close to historic lows Class B vacancy continues to decline, notwithstanding an increase in apartment completions across the broader apartment market The majority of new supply remains concentrated in primary markets, and
Slide 8: Recent Opportunistic Portfolio Acquisition
Property Name Market State Built / Renovated Units Period End Occupancy1 Avg. Effective Rent/Unit1 Close Date Kensington Commons Columbus OH 2004 264 97.7% $882 9/26/2017 Schirm Farms Columbus OH 2002 264 95.8% $846 9/26/2017 Riverchase Apts Indianapolis IN 2000 216 89.8% $814 9/26/2017 Cherry Grove
Slide 9: Dramatic Portfolio Transformation Since IPO
Dramatic Portfolio Transformation Since IPO Source: Company filings and CoStar. For all owned communities as of 3/31/2017 Please find a definition of Total Gross Assets in the appendix Midpoint of full year 2018 guidance as announced in Q1 2018 earnings release using weighted-average shares and unit
Slide 10: Portfolio Scale and Management Platform Deliver Operational Excellence
Portfolio Scale and Management Platform Deliver Operational Excellence Data as of March 31, 2018. Pro forma NOI reflects the impact of all acquisitions and dispositions as if they occurred on 1/1/2018, including IRT’s four acquisitions that occurred in Q1 2018. IRT’s Management Platform: Manage all
Slide 11: Value Add Opportunity Organically Drives Value
We define value add as any investment that will result in an ability to increase rents or provide a meaningful reduction in costs. Value Add Opportunity Organically Drives Value $ After Over 4,300 units identified for redevelopment across 14 properties creating organic value. Cabinets Countertops Bl
Slide 12: Building Blocks to Organic NOI Growth
Low risk redevelopment with potential for immediate value creation per unit 5 Communities 1,566 Units Est. $23M investment Est. return of 15-20% Est. avg. monthly rent premium of ~$190 Expected to be complete by end of 2018 9 Communities 2,752 Units Est. $23M investment Est. return of 20-25% Est. av
Slide 13: Simple Capital Structure
Data as of 3/31/18 As of market close 3/31/2017 & 3/29/2018 respectively Net debt to adjusted EBITDA reflects the proforma metric adjusted for the timing of acquisitions and timing of current value add initiatives. Excluding this adjustment, net debt to adjusted EBITDA would be 9.7x. 1Q 2017 53.2% D
Slide 14: How Do We Right Size Leverage?
How Do We Right Size Leverage? Figures are not drawn to scale Pro forma NOI reflects the impact of all acquisitions and dispositions as if they occurred on 1/1/2018, including IRT’s four acquisitions that occurred in Q1 2018. Projected annual organic total portfolio NOI growth of 3-4% For the three
Slide 15: 2018 Guidance
2018 Guidance Low High Net income allocable to common shares $0.26 $0.31 Earnings per share $0.26 $0.31 2018 EPS and CFFO Guidance Net income allocable to common shares $0.26 $0.31 Adjustments: Depreciation and amortization 0.43 0.43 Share base compensation 0.03 0.03 Amortization of deferred financi
Slide 16: How IRT Unlocks Long-term Value
How IRT Unlocks Long-term Value Clear investment strategy focused on middle-market communities across non-gateway MSAs Accretive, tenant-first approach to owning and operating high-quality multifamily communities Value add community redevelopment and capital recycling initiatives Simple, conservativ
Slide 17: Appendix & Definitions
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Slide 18: Resident Demographics at a Glance
Resident Demographics at a Glance 1 Data as of March 2018 52% 48% Gender Breakdown 71% 29% Marital Status 36 Average Income Of tenants between 40% $69k Average Income to rent 18-29 years old Average Age with Young, growing resident sample benefitting from amenity-rich communities without overextendi
Slide 19: Our Markets | Columbus Community Map
Our Markets | Columbus 1 Community Map Strong accessibility to major highway I-270 Class B communities insulated from new Class A construction Near thriving employment hubs such as Rickenbacker International airport Growing industrial development Job Growth Bennington Pond Apartments Groveport, OH S
Slide 20: Our Markets | Atlanta Community Map
Our Markets | Atlanta 1 Community Map Class B/B+ communities insulated from new Class A construction Located within 5 min. of major highways Located in top-5 school districts in each MSA Easy access to local retail centers Steady rent growth Benefitting from suburban sprawl, well-positioned in MSA’s
Slide 21: Our Markets | Raleigh – Durham Community Map
Our Markets | Raleigh – Durham 1 Community Map Class B/B+ communities insulated from new Class A construction Located near local airport as well as the “Research Triangle” Located within 5 min. of major highways Each community is in a top-5 school district in the market Easy access to local retail c
Slide 22: Our Markets | Louisville Community Map
Our Markets | Louisville 1 Community Map Located within 5 min. of major highways Class B communities insulated from new construction in that asset-class Focus on the inner beltway, close to the downtown employment center Benefitting from the proximity to growing industrial footprint Each community i
Slide 23: Our Markets | Tampa Community Map
Our Markets | Tampa 1 Community Map Job Growth Lakes of Northdale Tampa, FL Population Growth The market is on track to add 65,000 jobs between the winter of 2017 and the end of 20182 Job growth and population growth have been strengthened by recent recovery following the housing crisis Strong reinv
Slide 24: Definitions and Non-GAAP Financial Measure Reconciliations
Definitions and Non-GAAP Financial Measure Reconciliations Average Effective Monthly Rent per Unit Average effective rent per unit represents the average of gross rent amounts, divided by the average occupancy (in units) for the period presented. We believe average effective rent is a helpful measur
Slide 25: Definitions and Non-GAAP Financial Measure Reconciliations
Definitions and Non-GAAP Financial Measure Reconciliations Interest Coverage Interest coverage is a ratio computed by dividing our Adjusted EBITDA by our interest expense. Net Debt Net debt, a non-GAAP measure, equals total debt less cash and cash equivalents. The following table provides a reconcil
Slide 26: Forward-Looking Statement
Forward-Looking Statement This presentation may include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on current expectations, es
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