Boardwalk Real Estate Investment Trust · TSX:BEI.UN
Boardwalk Real Estate Investment Trust — Investor Presentation (November 2024)
50 slides from Boardwalk Real Estate Investment Trust's investor presentation, November 2024
Slide 1: November 2024 Investor Presentation
Gradient Swatches Gradient Bars Callout Text This is the preferred callout text size and shape. Explanation Caption November 2024 Investor Presentation This is an explanation box with emphasis. The typeface is Lato Bold 10.5 pt. Renewals represent 65-75% of monthly lease activity. In non-price-contr
Slide 2: Forward Looking Statements & Non-GAAP Measures
Forward Looking Statements & Non-GAAP Measures This presentation contains forward-looking statements and information include, but are not limited to, the impact of economic conditions in Canada and September 30, 2024 and 2023. (collectively, "forward-looking statements") within the meaning of applic
Slide 3: Executive Summary
Executive Summary Why Boardwalk? - Largest presence of affordable non-regulated apartments in Canada at an attractive valuation - Positioned in sustainably growing markets - Laser focused on affordable resident experience with love always - Intergenerational commitment and long-term focus - Operatio
Slide 4: BFF=Boardwalk Family Forever
BFF=Boardwalk Family Forever Our Reason For Being Love Always Delight Satisfaction Resident Investors Members Boardwalk WESG Family Partners Forever Capital Associates Excitement Comfort Community 4
Slide 5: Resident Members First
Resident Members First Resident Members Customer Service We live by a simple premise: Our Leaders put our Team first and our Team puts our Resident Operations Members first. Management Executives CEO 5
Slide 6: Operational Stability and the Resiliency of Affordable Housing
Operational Stability and the Resiliency of Affordable Housing Well-Positioned With Some of the Most Affordable Rents in Canada • Average occupied rent(1) of $1,493 compared to Canadian market rent of $2,287(2) • Affordable product is currently priced well below new supply • Affordable apartments wi
Slide 7: Corporate Profile
Corporate Profile Boardwalk is a growth-oriented Canadian multi-family real estate owner and operator with a community focus $8.6B $371.2M 96% >24% 34,393 Net Operating Income of mortgages are combined insider Total Assets(1) (12 months ended Total Suites(1)(2) September 30, 2024) CMHC insured(1) ow
Slide 8: How We Create Value for Stakeholders
How We Create Value for Stakeholders Best In Class Organic Growth Paired With Strong Affordable Housing Fundamentals 9 Accretive Capital Recycling 22 Solid Financial Foundation 26 Compelling Value 30 8
Slide 9: Best In Class Organic Growth Paired With Strong Affordable Housing Fundamentals
Best In Class Organic Growth Paired With Strong Affordable Housing Fundamentals 9
Slide 10: Alberta Interprovincial Migration Mapping
Alberta Interprovincial Migration Mapping Alberta seeing record inflows from other regions of Canada. Interprovincial Migration Net(1) Net Interprovincial Current Trailing 4 Quarters Alberta Total2 = 43,750 BC: 12,385 SK + MB: 7,564 2016 Net Interprovincial ON + QC: 20,515 (Low Case) BC: 12,705 Albe
Slide 11: Consistent Outperformance on Population Growth
Consistent Outperformance on Population Growth Relative Population Growth by CMA (Index = 2001) Relative Population Growth by Province (Index = 180 Q1 2001) 165 Alberta Calgary 170 155 160 Edmonton 145 British Saskatoon Columbia 150 Kitchener 135 140 Regina Ontario London 125 Saskatchewan 130 Montre
Slide 12: Non-Permanent Resident Share of Population
Non-Permanent Resident Share of Population Q2 2024 Provincial Non-Permanent Resident Concentration 1,600,000 10.00% 9.00% 1,400,000 8.00% 1,200,000 7.00% 1,000,000 6.00% 800,000 5.00% 4.00% 600,000 3.00% 400,000 2.00% 200,000 1.00% - 0.00% British Alberta Saskatchewan Manitoba Ontario Quebec New Nov
Slide 13: Growing Relative Affordability
Growing Relative Affordability Continuous Improvement in Affordability Driving Interprovincial Migration Composite Benchmark 1,400,000 1,200,000 1,000,000 ~490,000 800,000 600,000 ~90,000 400,000 200,000 - May-23 Jan-24 May-12 May-13 May-14 May-15 May-16 May-17 May-18 May-19 May-20 May-21 May-22 May
Slide 14: Alberta Labour Force Growth
Alberta Labour Force Growth Employment Growth Coming from Diverse Industries Total Employed (Index = Jan 2000) Labour Force Survey Alberta(1)(2) 170 400 Wholesale & AB retail trade 160 350 Health care 150 BC 300 Construction ON 140 250 Professional & QC scientific 130 200 Education Oil, mining & 120
Slide 15: Calgary's Tech Sector Leads the Way
Calgary’s Tech Sector Leads the Way Calgary has seen the highest percentage growth in tech jobs within CBRE’s 2024 Tech Talent Report. Over 26,000 jobs have been added between 2018 and 2023. Sources: CBRE, Statistics Canada, BLS 15 (1) Cities scaled by % change in jobs
Slide 16: Positioned in Canada's Most Affordable Markets
Positioned in Canada’s Most Affordable Markets Affordability: Rent Compared to Median Household Income(1)(2)(3) 120,000 60% 49% 100,000 50% 43% 41% 35% 80,000 40% 31% 32% 28% 60,000 30% 24% 22% 22% 22% 40,000 20% 20,000 10% - 0% Edmonton Calgary Montreal London Regina Saskatoon Quebec Kitchener Vict
Slide 17: Under Construction Inventory
Under Construction Inventory Under Construction Inventory Scaled for Market Size 120,000 6.0% Under Construction % of Housing Stock 100,000 5.0% Under Construction Inventory 80,000 4.0% 60,000 3.0% 40,000 2.0% 20,000 1.0% - 0.0% Edmonton Calgary Montreal London Regina Saskatoon Quebec Kitchener Vict
Slide 18: Q3 2024 Operating Results
Q3 2024 Operating Results Same Property NOI Performance % Rental % Total Rental % Net Operating Same Property Sep. 30 2024 - 3 M # of Suites Revenue Growth Expenses Growth Income Growth % of NOI Edmonton 12,882 10.7% 3.4% 15.6% 35.0% Calgary 6,266 10.5% -2.8% 16.6% 24.6% Other Alberta 1,936 11.1% 7.
Slide 19: Rent Change on New & Renewal Leases
Rent Change on New & Renewal Leases Alberta Rent Change from Prior Lease Portfolio Rent Change from Prior Lease 14.7% 14.1% 14.4% 14.1% 14.3% 13.7%13.3% 14.1%14.1%14.1% 13.0% 12.6% 12.9% 13.5% 12.7% 12.5%13.1%12.2%12.0% 12.1% 12.1% 11.3% 11.9% 11.3% 11.5% 11.2% 10.9% 10.4% 9.5% 9.6% 9.3% 9.1% 9.7% 9
Slide 20: Operating Costs & Margin
Operating Costs & Margin Discipline & innovation on controllable operating expenses are offsetting higher non-controllable costs Rental Revenue, Total Rental Expenses & Operating Margin(1) $546 $496 $455 $466 $471 61.0% 58.3% 58.2% 57.8% 56.8% Strong margin improvement due to strong revenue growth $
Slide 21: Vertically-Integrated Platform
Vertically-Integrated Platform In-House Landscaping, Cleaning and Maintenance - Maximizes Resident Member experience and enhances curb appeal of communities Leasing Internal Capital Team - Dedicated lease renewal teams - In-house renovation to most effectively serve our capabilities to refresh Stron
Slide 22: Accretive Capital Recycling
Accretive Capital Recycling 22
Slide 23: Accretive Capital Recycling - Summary
Accretive Capital Recycling - Summary Value-Add Capital Opportunistic, Accretive and ▪ Cost effective value-add amenity Strategic Acquisitions and common area renovations ▪ Source opportunities that are accretive requiring minimal per suite rental to FFO per Unit and to NAV per Unit increases to gen
Slide 24: Disciplined Capital Allocation
Disciplined Capital Allocation BEI-UN Unit Price $90 $85 $80 $75 $70 $65 $60 $55 $50 $45 $40 8/1/2021 9/1/2021 1/1/2022 2/1/2022 3/1/2022 4/1/2022 5/1/2022 6/1/2022 7/1/2022 8/1/2022 9/1/2022 1/1/2023 2/1/2023 3/1/2023 4/1/2023 5/1/2023 6/1/2023 7/1/2023 8/1/2023 9/1/2023 1/1/2024 2/1/2024 3/1/2024
Slide 25: Development Pipeline
Development Pipeline Steady Progress on Value Creating Development Pipeline Stabilized / Under Construction Under Construction Future Developments – Timing TBD Project 45 Railroad Aspire The Marin Island Highway Marda Loop Location Brampton, Ontario View Royal, British Columbia Esquimalt, British Co
Slide 26: Solid Financial Foundation
Solid Financial Foundation 26
Slide 27: FFO per Unit and Distribution Growth
FFO per Unit and Distribution Growth Policy of Maximum Cashflow Retention for Reinvestment and Organic Growth Annual Funds from Operations per Unit(1) and Distribution per Unit(2)(3) $4.15 – $4.23 $3.60 $3.13 $2.94 Growth in $2.74 $2.57 reinvested $2.21 $2.11 cash flow $1.40 $1.07 $1.16 $1.00 $1.00
Slide 28: Mortgage Summary
Mortgage Summary Laddered Maturity Profile Reducing Impact of Current Rate Environment Mortgages Payable Maturity Schedule $700 96% of principal $600 outstanding is CMHC 4.53% insured $500 3.67% Principal Outstanding 3.70% $400 3.14% 3.16% 4.13% Average term to 3.61% 2.55% maturity of debt: 2.44% $3
Slide 29: Solid Financial Foundation
Solid Financial Foundation Interest Coverage Ratio Leverage 2.92 45% 11.02x 12.00x 2.90 10.31x 11.00x 40% 2.88 10.00x Debt / EBITDA Debt / Assets 2.86 35% 9.00x 2.84 30% 8.00x 2.82 7.00x 25% 2.80 6.00x 43% 40% 2.78 20% 5.00x Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2023 Q3 2024 (1) (2)(3) Debt / Total Ass
Slide 30: Compelling Value
30 Pu Compelling Value boardwalk
Slide 31: Exceptional Value
Exceptional Value Recent Transactions In Line With Current NAV Estimate In Boardwalk Markets Current Trading Price1 Q3 NAV per Unit2 Unit Price $60 $70 $80 $90 $94.64 $100 $110+ IFRS Cap Rate: 5.09% Price Per Suite $183k $199k $215k $231k $239k $247k $263k+ Edgehill and Panorama All Investments Apar
Slide 32: Increasing Replacement Cost
Increasing Replacement Cost Residential Composite Building Price Index 210 Key Components Constraining Supply Response Relative to Demand 190 Escalation in replacement costs over past 170 several years. 150 Higher interest rates. 130 Construction timeframes for larger multi- family assets. 110 Decli
Slide 33: Exceptional Value – Implied Cap Rate
Exceptional Value – Implied Cap Rate NOI Growth Supportive of Positive Spread vs. Interest Rates on Forward-Looking Basis BEI.un Valuation per Suite $250 Current NAV $220 $190 $160 $130 $100 $65.00 $70.00 $75.00 $80.00 $85.00 $90.00 $94.64 $100.00 $105.00 $110.00 Implied Value per Suite ($000s) $191
Slide 34: Forecasted Multiples & FFOPU Growth
Forecasted Multiples & FFOPU Growth BEI vs MF Peer Group Relative Valuation(1) 18.0x Peer 3 Peer 1 16.0x BEI Peer 4 14.0x Peer 2 12.0x P / FFO Multiple 2025 F 10.0x 8.0x 6.0x 4.0x 2.0x 0.0x 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 2020 to 2025 F FFO / Unit CAGR Source: FactSet (1) Prices and esti
Slide 35: Creating Value for All Stakeholders
Creating Value for All Stakeholders 35
Slide 36: 2024 Guidance Update
2024 Guidance Update Q3 2024 Revised 2024 Previous Description Guidance Guidance 2023 Actual Same Property NOI Growth 12.5% to 14.5% 12.5% to 14.5% 13.7% Profit N/A N/A $666,099 FFO (1)(2)(3) N/A N/A $181,353 AFFO (1)(2)(3)(4) N/A N/A $149,098 FFO Per Unit (2) $4.15 to $4.23 $4.11 to $4.23 $3.60 AFF
Slide 37: Street Research Targets
Street Research Targets Analyst Target Prices $97.00 $95.00 $91.00 $91.00 $90.00 $90.00 $86.00 $86.00 $84.00 $81.75 Scotiabank BMO CIBC Cormark National Bank RBC Desjardins Raymond James TD Cowen Veritas Source: FactSet, as at November 7, 2024. 37
Slide 38: Contact Information
Contact Information Sam Kolias Gregg Tinling Samantha Chief Executive Chief Financial Kolias-Gunn Officer Officer Senior Vice President Corporate Development and Governance For Further Information Email: Investor@bwalk.com Phone: 403-531-9255 James Ha Eric Bowers President Vice President, Finance &
Slide 39: Appendix
39 Appendix boardwalk
Slide 40: Deployment of Equity Issuance Proceeds
Deployment of Equity Issuance Proceeds Capitalizing on Opportunities in 2024 Construction Line 45 Railroad Dawson Landing Acquisition The Circle (Calgary) Elbow 5 Eight (Calgary) Paydown (Brampton) (Chestermere) Amount $57.2 million Suite Count 295 Suites 63 Suites 255 Suites Paydown Date January 20
Slide 41: Increasing Affordability Relative to Home Ownership
Increasing Affordability Relative to Home Ownership Monthly Mortgage Cost Less Boardwalk Same Property Occupied Rents(1)(2) 3,000 2,500 2,000 1,500 1,000 500 - 1/1/2012 4/1/2012 7/1/2012 1/1/2013 4/1/2013 7/1/2013 1/1/2014 4/1/2014 7/1/2014 1/1/2015 4/1/2015 7/1/2015 1/1/2016 4/1/2016 7/1/2016 1/1/2
Slide 42: Alberta Net Migration
42 5,000 15,000 25,000 35,000 (15,000) (5,000) Q4 1965 Q1 1967 Q2 1968 Q3 1969 Source: Statistics Canada. Q4 1970 Q1 1972 Q2 1973 Q3 1974 Q4 1975 Q1 1977 Net Migration - Alberta Q2 1978 Q3 1979 Q4 1980 Q1 1982 Q2 1983 Q3 1984 Q4 1985 Q1 1987 Q2 1988 Q3 1989 Q4 1990 Q1 1992 Interprovincial Migration
Slide 43: Q3 2024 Financial Highlights
Q3 2024 Financial Highlights 3 Months Ended September 30 Q3 2024 Q3 2023 % Change Net Asset Value per Unit(2) & Unitholders' Equity Same Property Rental Revenue $150.1 $137.1 9.5% $4,795 Same Property Net Operating $94.64 $99.2 $87.5 13.5% Income Same Property Operating Margin 66.1% 63.8% +230 bps F
Slide 44: Recycling Cash Flow Toward Repositioning & Value-Add Capital Improvements
Recycling Cash Flow Toward Repositioning & Value-Add Capital(1) Improvements Renovations Driving Market Share & Revenue Growth 13 Properties Suite Optimization Project Completed / In-progress 68% 10 Properties 62% 12 Properties 54% 15 Properties 45% 12,962 23 Properties 11,914 34% 10,825 24 Properti
Slide 45: Occupancy Trend
Occupancy Trend Maintaining Occupancy as a Component of Revenue Optimization Rentals Move-Outs & Occupancy 1,400 100.0% 1,200 98.0% 1,000 96.0% 800 94.0% 600 92.0% 400 200 90.0% 0 88.0% Apr Apr Apr Nov Dec Nov Dec Feb Feb Feb Mar May Aug Sep Mar May Aug Sep Mar May Aug Sep Jun Oct Jan Jun Oct Jun Ja
Slide 46: Reasons for Move-Out & Out of Town Rentals
Reasons for Move-Out & Out of Town Rentals 2023 2023 2024 2024 Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Total Out of Town Rentals Moving out of town 359 607 490 341 1,797 313 556 546 1,415 Calgary Edmonton Purchased Home 198 333 321 258 1,110 222 386 412 1,020 Fort McMurray Grande Prairie Transfer / Assignment 25
Slide 47: Mark-to-Market Revenue Gain Statistics – Same Property
Mark-to-Market Revenue Gain Statistics – Same Property Without Incentives With Incentives Annualized Annualized Mark-to- Mark-to- Market Adjusted Market Adjusted Sep 2024 Weighted for Current for Current Sep 2024 Sep 2024 Mark-to- Occupancy Market Sep 2024 Mark-to- Occupancy Average Market Occupied
Slide 48: Making an Impact: ESG initiatives and highlights
WESG Making an Impact our ESG initiatives and highlights Invested over $16.7 million Engaged Resident Members and in energy efficiency upgrades across Associates in sustainability efforts by our portfolio in 2023. hosting educational campaigns, 67 2024 GRESB Score. expanded our Microhabitat partners
Slide 49: WESG
WESG Making an Impact our ESG initiatives and highlights • Our guiding compass in our efforts to prioritize commitments to five core pillars to build more inclusive, sustainable and healthier communities. • Redefining what it means to be a landlord we are driven by purpose, with the goal of building
Slide 50: Communities in Motion
Communities in Motion At Boardwalk, Communities are in Motion. During the launch of our new website and beyond, you’ll see a vibrant new symbol appearing on our pages. This colourful “Communities in Motion” mark is a powerful reminder that the strongest, most vibrant communities emerge when we all c
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