Safehold Inc. New · NYSE:SAFE
Safehold Inc. New — Safehold — Investor Presentation (September 2019)
18 slides from Safehold Inc. New's investor presentation, September 2019
Slide 1: mber 2019
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Slide 2: Forward-Looking Statements and Other Matters
Forward-Looking Statements and Other Matters This release may contain forward-looking statements. All statements other than statements of historical fact are forward- looking statements. These forward-looking statements can be identified by the use of words such as “illustrative”, “representative”,
Slide 3: Proven Formula for Success
Proven Formula for Success Safehold is revolutionizing commercial real estate ownership by providing a better and more efficient way for owners to unlock the value of the land beneath their buildings. Deliver a Better Make a Big Powerful Market Disruptor Industry More Efficient Customer Experience R
Slide 4: A Better, More Efficient Solution
A Better, More Efficient Solution Making ground leases modern, efficient, and value-enhancing for building owners Improved gnificant I Cost Efficiency isk Reduction Near-term > Transfer Tax maturity risk 3% Mortgage Recording Tax 1 1 ! I 2 Title Insurance 18354 ! I ! 1 | $3 Other Transaction Costs Y
Slide 5: Gaining Traction - Growing Customer Penetration
Gaining Traction - Growing Customer Penetration Aggregate Portfolio Growth!) Increasing Market Penetration ($ in M) (by # of MSAs) 1,851 my) ee ! I I I ! I 2x I I ! I I I ! 1 I I 13 I I $664 I | 1 I I ! 1 $339 I I ! I I I ! I Poot IPO 6/30/2018 6/30/2019 ~—- Pro Forma”! IPO (6/22/2017) 6/30/2018 6/3
Slide 6: Gaining Traction - Strong Financial Performance
Gaining Traction — Strong Financial Performance Earnings $5.9 +237% $1.8 Q2 18 Net Income ($M] $0.09 Q2 18 $0.18 +88% EPS SAFE Stock Performance Since IPO (As of 9/5/19) / $28.71 +44% / $20.00 IPO (6/22/2017) 9/5/2019
Slide 7: Key Investment Attributes of Safehold's Portfolio
3 Key Investment Attributes of Safehold’s Portfolio C1 0] Embedded Superior Attractive Capital Principal Safety Returns sgt Appreciation Senior position in capital structure [ Opportunity for superior risk- GC Growing portfolio creates potential Senior priority of rent payment!!! adjusted returns fo
Slide 8: Superior Principal Safety
Superior Principal Safety Illustrative Single Asset CMBS Highest Risk B (60-65% LTV] BB (55-60% LTV) BBB (50-55% LTV) A (45-55% LTV) AA (40-45% LTV) AAA (0-40% LTV) Safest Illustrative Safehold Structure Leasehold Mortgage Senior Position in (35-65% CPV) Capital Structure Similar to AAA CMBS Positio
Slide 9: Attractive Returns vs. Comparable Bond
Attractive Returns vs. Comparable Bond Contractual rent increases create long-term compounding cash flows that generate superior risk-adjusted returns versus similar-risk fixed income securities Ground Lease vs. 100-Year MIT Bond 30% Why Compare to a ; 100-Year MIT bond? 25% 24.4% 20.4% C Best bench
Slide 10: Attractive Returns - Premium Asset & Platform
Attractive Returns - Premium Asset & Platform Premium Asset Value Diversified portfolio generates superior risk-adjusted returns Illustrative Model MIT Ground Lease Returns” 5.0% - 5.5% Premium Spread Bond Comparison”) Cost of Debt! 3.75% - 4.5% 2x Leverage issue YTM Return on Equity (ROE) ~7.5% 3.9
Slide 11: Unrealized Capital Appreciation Growth
Unrealized Capital Appreciation Growth $3.5B The Unrealized Capital Appreciation in Our Owned Residual Portfolio is calculated as today’s estimated Combined Property Value (CPV] less the Aggregate Cost Basis of SAFE’s portfolio. CRE conducts independent appraisals of the CPV of each asset.") $2.2B I
Slide 12: Conclusion
Conclusion . G Using a deep skill set and history of innovation to solve a Outsized major market inefficiency in the $7 trillion U.S. Opportunity institutional real estate market CG Fast growing platform generating well above market Growth and returns with minimal principal risk creates unique Value
Slide 13: Safehold
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Slide 14: Appendix: Debt Overview
Appendix Debt Overview (As of July 26, 2019) Improving Liability Structure!” Debt W.A. W.A. Outstanding Cash Rate Interest Rate W.A. Maturity $603M 3.5% A 23 Years Upsized Revolver!) $450M CG Refinanced short-term debt $350M with long-term financing [ Expanded Bank Group [C Upsized Revolver Capacity
Slide 15: Income Statements
Income Statements For the three months ended June 30, For the six months ended June 30, 2019 2018 2019 2018 Revenues: Operating lease income $17,196 $9,861 $37,712 $21,141 Interest income from sales-type leases 1,880 - 2,802 4 Other income 604 1,713 986 2,126 Total revenues $19,680 $11,574 $41,500 $
Slide 16: Balance Sheets
Balance Sheets June 30, 2019 December 31, 2018 Assets: Real estate Real estate, gross Accumulated depreciation Real estate, net Real estate-related intangibles, net!!! Ground lease assets, net Net investment in leases Cash and cash equivalents Other assets Total assets Liabilities: Debt obligations,
Slide 17: Portfolio Reconciliation
Portfolio Reconciliation Announced + Closed 6/22/17 Subsequentto Pro Forma (PO) 6/30/18 6/30/19 6/30/19 Total Net investment in leases (Sales Type Leases) - - $160 Real estate, net (Operating Leases) $265 $477 $663 Add: Accumulated depreciation | 7 13 Add: Lease intangible assets, net 123 197 235 Ad
Slide 18: Appendix: Glossary
Appendix Glossary Aggregate Cost Basis Aggregate Gross Book Value Annualized Cash Rent Cash Rent Cost Basis Combined Property Value [CPV] Current Portfolio Effective Yield Gross Book Value (GBV) Interest Rate Leverage Owned Residual Portfolio Percentage Rent Safehold™/Safehold™ Ground Lease Unrealiz