Kite Realty Group Trust · NYSE:KRG
Kite Realty Group Trust — Investor Presentation (September 2008)
24 slides from Kite Realty Group Trust's investor presentation, Sep 10, 2008
Slide 1: Kite Realty Group Trust September 2008
Kite Realty Group Trust September 2008
Slide 2: Disclaimer
DISCLAIMER This presentation may include certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward- looking statements include, but are not limited to, our plans, objectives, expectations and intentions and other statements contain
Slide 3: Primary Objectives for the Company
COMPANY OVERVIEW PRIMARY OBJECTIVES FOR THE COMPANY Balance Sheet Management Continue to Manage Debt Maturities Execute Capital Plan Development Complete Current Development Pipeline 78% pre-leased or committed Commence construction of Visible Shadow Pipeline Internal Growth Operational Efficiencies
Slide 4: Consumer Behavior and Property Type Allocation
COMPANY OVERVIEW Information as of June 30, 2008 Consumer Behavior Nationwide consumption levels will fluctuate, but a portion of the consumer’s behavior is derived from necessity. Grocery-anchored centers and value-oriented retailers such as Target and Wal-Mart will continue to create shopping cent
Slide 5: Geographic Diversification
COMPANY OVERVIEW Information as of June 30, 2008 GEOGRAPHIC DIVERSIFICATION Projected Total GLA Including Pipelines 1,2 (1) Total GLA includes owned GLA, square footage attributable to non-owned outlot structures on land that the Company owns and non-owned anchor space that currently exists or is un
Slide 6: Strong Tenant Diversity
COMPANY OVERVIEW Information as of June 30, 2008 except as noted STRONG TENANT DIVERSITY Top 10 Retail Tenants by Base Rent % of Portfolio S&P 1 Annualized Base Rent Credit Rating 1 Lowe's Home Improvement 3.4% A+ 2 PetSmart 2.7% BB 3 Publix 2.4% n/a 4 Marsh Supermarkets 2.2% n/a 5 Circuit City 2.1%
Slide 7: Embedded Growth: Current Developments
GROWTH STRATEGY Information as of June 30, 2008 EMBEDDED GROWTH: CURRENT DEVELOPMENTS STRONG UPSIDE Only 20% occupied Growth source for late 2008 and 2009 LOW RISK PROFILE 78% leased or committed 64% funded Execute small shop leases and build out tenant spaces 7
Slide 8: Selective Acquisitions: Rivers Edge Shopping Center
GROWTH STRATEGY SELECTIVE ACQUISITIONS A CASE STUDY: RIVERS EDGE SHOPPING CENTER Location: Keystone-Castleton, the most heavily traveled retail corridor in Indianapolis Competitive Advantage: Off-market pricing, long-standing relationships Capitalization: Partially funded by proceeds from non-core,
Slide 9: Potential Same Store Growth via Lease Expirations
GROWTH STRATEGY Information as of June 30, 2008 POTENTIAL SAME STORE GROWTH VIA LEASE EXPIRATIONS Nearly 30 percent ($21 million) of annualized base rent expires from 2010 to 2012 During the years 2010 through 2012, 550,000 square feet per year will expire (compared to 250,000 per year for the years
Slide 10: Emphasizing Internal Growth
GROWTH STRATEGY Information as of June 30, 2008 EMPHASIZING INTERNAL GROWTH Existing Vacancy Operating retail portfolio is 93.0% leased Negotiating lease for 23,000 square foot junior anchor space vacated in early 2008 - represents 0.5% increase in occupancy Operational Efficiencies Leveraging barga
Slide 11: Peer Group Comparison
PEER GROUP COMPARISON Assuming a peer group average multiple of 12.3x, our stock is trading at a 33% discount Share PriceConsensus Company 9/5/2008 Estimate1 Multiple Federal Realty $75.88 $3.89 19.5x Acadia Realty Trust $23.50 $1.34 17.5x Equity One, Inc $20.70 $1.37 15.1x Kimco Realty Corporation
Slide 12: Peer Group Comparison: Dividend Yield
PEER GROUP COMPARISON Our dividend yield remains attractive Share Current Price Annual 1 Company 9/5/2008 Dividend Yield Ramco Gershenson $22.89 $1.85 8.1% Developers Diversified $35.18 $2.76 7.8% Kite Realty Group $11.63 $0.82 7.1% Cedar Shopping Centers $13.02 $0.90 6.9% Inland Real Estate Corp $1
Slide 13: Development & Redevelopment Pipeline
DEVELOPMENT & REDEVELOPMENT PIPELINE Information as of June 30, 2008 Projected Total % Leased / Total Est. Cost Project MSA GLA 1 Committed 3 (000s) Anchor Tenants Target (non-owned), Michael’s, Best Buy, Bayport Commons 2 Tampa, FL 286,000 91.0% $27,600 PetSmart Cobblestone Plaza 2 Ft. Lauderdale,
Slide 14: Visible Shadow Pipeline
VISIBLE SHADOW PIPELINE Information as of June 30, 2008 Est. Total Est. Total 1 1 Project KRG % Owned MSA GLA Cost (000s) Potential Tenancy 2 Frank Theatres, Discount Dept. Parkside Town Commons 40% Raleigh, NC 1,500,000 $148,000 Stores, Jr. Boxes, Restaurants 3 Publix, Frank Theatres, Jr. Delray Ma
Slide 15: A Case Study in Risk Mitigation: Eddy Street Commons
DEVELOPMENT PIPELINE A CASE STUDY IN RISK MITIGATION: EDDY STREET COMMONS 15
Slide 16: A Case Study in Risk Mitigation: Eddy Street Commons
DEVELOPMENT PIPELINE Information as of June 30, 2008 A CASE STUDY IN RISK MITIGATION: EDDY STREET COMMONS $200 million mixed-use development next to the University of Notre Dame in South Bend, IN will be completed in phases $35 million Phase I, which will include retail and office, was only recently
Slide 17: Eddy Street Commons Phase I
DEVELOPMENT PIPELINE A CASE STUDY IN RISK MITIGATION: EDDY STREET COMMONS Phase I – Retail, Office, Multi-family, Parking Garage 17
Slide 18: Strong Demographics
STRONG DEMOGRAPHICS DEVELOPMENT SUCCESS NOT DEPENDENT ON GROWTH Portfolio Demographic Comparison Operating Portfolio vs. Development Pipeline Radius Radius Operating Portfolio 3 Mile 5 Mile Development Pipeline 3 Mile 5 Mile 2007 Est. Population 49,691 124,977 2007 Est. Population 44,549 118,951 201
Slide 19: Capital Plan
CAPITAL PLAN Information as of June 30, 2008 EXECUTE ON STRATEGY TO ENSURE CAPITAL AVAILABILITY Credit Facility and Cash: $44 million Unsecured Term Loan: $55 million funded $5 million in negotiation Potential Asset Sales: $25 million Targeted Asset Transfer to JVs: $30 to $35 million Targeted Liqui
Slide 20: Managing Debt Maturities
MANAGING DEBT MATURITIES Information as of June 30, 2008 AGGRESSIVE REFINANCING, SOLID EXECUTION 2009 Consolidated Debt Maturities: $190 million Construction Loans with Existing Extension Options: $75 million Negotiating Extensions/Mini Perms: $57 million Q4 2009 Maturities: $49 million New Construc
Slide 21: Committed Management
COMMITTED MANAGEMENT Senior management owns approximately 23 percent of the Company and has acquired over 400,000 shares and 800,000 units since the IPO at a cost of approximately $21M Tenure with Company Ownership 1 Al Kite Chairman 48 years 10.7% John Kite President & CEO 18 years 8.2% Tom McGowan
Slide 22: Operating Metrics
OPERATING METRICS For the Three Months Ended June 30, 2008 Selected Peer Group KRG Average 1 NOI / Revenue 73.2% 70.2% G&A / Revenue from Rental 4.8% 7.2% Properties Fixed Charge Coverage 2 2.6x 2.7x FFO Payout % 66% 71% Portfolio % Leased 93.5% 94.9% (1) Peer Group consists of KIM, DDR, AKR, REG an
Slide 23: In Conclusion
IN CONCLUSION A SOLID FOUNDATION A CLEAR STRATEGY Healthy pay-out ratio 2008 – 2012 Growth initiatives Strong fixed charge coverage Shadow pipeline Capital available for development Internal growth pipeline ‘A’ locations Good real estate wins High occupancy Diverse tenant mix with conservative expos
Slide 24: Corporate Profile
CORPORATE PROFILE Kite Realty Group Trust is a full-service, vertically integrated real estate investment trust engaged primarily in the ownership, operation, management, leasing, acquisition, construction, expansion, and development of high quality neighborhood and community shopping centers in sel
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