Jbg Smith Properties · NYSE:JBGS

Jbg Smith Properties — Investor Presentation (February 2021)

42 slides from Jbg Smith Properties's investor presentation, Feb 23, 2021

  1. Slide 1: 1770 Crystal Drive and Crystal Drive Retail Repositioning

    1770 Crystal Drive and Crystal Drive Retail Repositioning INVESTOR PRESENTATION FEBRUARY 2021

  2. Slide 2: Disclosures: Forward-Looking Statements

    DISCLOSURES FORWARD-LOOKING STATEMENTS Certain statements contained herein may constitute “forward-looking statements” as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are

  3. Slide 3: Disclosures: Pro Rata Information

    DISCLOSURES PRO RATA INFORMATION We present certain financial information and metrics in this release “at JBG SMITH Share,” which refers to our ownership percentage of consolidated and unconsolidated assets and liabilities owned through real estate ventures (collectively, “real estate ventures”) as

  4. Slide 4: Disclosures

    DISCLOSURES estimated contract value resulting from an increase in the approved development density on the site. The sale of Pen Place to Amazon for approximately $149.9 million is expected to close in 2021, subject to customary closing conditions. We are the developer, property manager and retail l

  5. Slide 5: Key Updates

    KEY UPDATES 5 Acquired future development asset adjacent to Amazon HQ2 (up to 550K SF of new development density) Submitted entitlements for the second phase of Amazon's new headquarters (2.8M SF of office + The Helix) AMAZON HQ2 ESG VIRGINIA TECH INNOVATION CAMPUS ACQUISITIONS Secured final entitle

  6. Slide 6: Who We Are: JBG SMITH Overview

    6 WHO WE ARE: JBG SMITH OVERVIEW MIXED-USE OWNER AND OPERATOR FOCUSED ON HIGH-GROWTH, AMENITY-RICH SUBMARKETS IN THE DC METRO AREA SIGNIFICANT DEMAND CATALYSTS IN NATIONAL LANDING SUBSTANTIAL NOI AND LONG-TERM NAV/SHARE GROWTH OPPORTUNITY leased across our In-Service operating portfolio 89.2% assets

  7. Slide 7: Who We Are: Concentrated in High-Growth Submarkets

    WHO WE ARE: CONCENTRATED IN HIGH-GROWTH SUBMARKETS 7 MD VA Washington, DC 20MINUTE COMMUTE TO NATIONAL LANDING Bethesda CBD Reston (O Map) DC Mature RB Corridor National Landing Amazon HQ2 Virginia Tech Innovation Campus Downtown Silver Spring Other MD (O Map) DC Emerging Note: Size of sphere bas

  8. Slide 8: Recession Resilience vs Other Gateway Markets

    RECESSION RESILIENCE VS OTHER GATEWAY MARKETS 8 -5.0% -4.0% -3.0% -2.0% -1.0% -10.0% -9.0% -8.0% -7.0% -6.0% 0.0% 1.0% 2.0% 3.0% Washington, DC Gateway Markets Employment Change (%) 2008-2009 Great Recession 2001-2002 Tech Crash 1990-1992 Recession 2020 COVID-19(1) (Preliminary) LIKE IN PAST DOWNTUR

  9. Slide 9: Out-of-City Migration Trend Versus Other Gateway Markets

    OUT-OF-CITY MIGRATION TREND VERSUS OTHER GATEWAY MARKETS 9 120.0% 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% Manhattan, NY San Franscico, CA Washington, DC Boston, MA Increase in Out-of-City Change of Address Requests (%) OUT-OF-CITY MIGRATION INCREASE(1) (2019-2020) 20.3% 106.9% 78.5% 16.8% Source: Goldma

  10. Slide 10: Multifamily Resilience vs Other Gateway Markets

    MULTIFAMILY RESILIENCE VS OTHER GATEWAY MARKETS 10 Rent Growth (%) Occupancy Change (%) -8.0% -6.0% -4.0% -2.0% -- 2.0% 4.0% Multifamily -15.0% -10.0% -5.0% -- 5.0% 10.0% Oce Washington, DC Gateway Markets Washington, DC Gateway Markets(1) Rent Growth (%) Occupancy Change (%) -8.0% -6.0% -4.0% -2.0

  11. Slide 11: Office Resilience vs Other Gateway Markets

    OFFICE RESILIENCE VS OTHER GATEWAY MARKETS 11 Rent Growth (%) Occupancy Change (%) Multifamily -10.0% -8.0% -6.0% -4.0% -2.0% 0.0% Oce Washington, DC Gateway Markets -10.0% -8.0% -6.0% -4.0% -2.0% 0.0% Washington, DC Gateway Markets Rent Growth (%) Occupancy Change (%) Multifamily -10.0% -8.0% -6.0

  12. Slide 12: Demand Catalysts in National Landing: Amazon HQ2 and Virginia Tech

    DEMAND CATALYSTS IN NATIONAL LANDING: AMAZON HQ2 AND VIRGINIA TECH 12 AMAZON HIRING EXPECTATION INCREASE IN DAYTIME POPULATION TOTAL PUBLIC AND PRIVATE INVESTMENT JBGS DEVELOPMENT PIPELINE 38K+ JOBS 70% $11B 7.8M SF New Metro Entrance New Metro Station Route One to Grade New Rail Station and Airport

  13. Slide 13: Demand Catalysts in National Landing: Growth Timeline

    DEMAND CATALYSTS IN NATIONAL LANDING: GROWTH TIMELINE 13 AMAZON JOB GROWTH AND MAJOR MILESTONES(1) Amazon Hiring Expectation (Cumulative) Year End 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 2019 2020 2018 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 POTENTIAL T

  14. Slide 14: Demand Catalysts in National Landing: Seattle Case Study

    DEMAND CATALYSTS IN NATIONAL LANDING: SEATTLE CASE STUDY 14 AMAZON DROVE SIGNIFICANT OFFICE AND RESIDENTIAL DEMAND NEAR ITS SEATTLE HEADQUARTERS OFFICE DEMAND 40K Amazon jobs created from 2010 - 2018, 5.5M+ SF of follow-on technology demand KEY AMAZON BUILDINGS KEY MULTIFAMILY DEVELOPMENTS MULTIFAMI

  15. Slide 15: Demand Catalysts in National Landing: Virginia Tech Innovation Campus

    15 DEMAND CATALYSTS IN NATIONAL LANDING: VIRGINIA TECH INNOVATION CAMPUS FIRST VIRTUAL CLASSES COMMENCED CONSTRUCTION ANTICIPATED VIRGINIA TECH INVESTMENT AT BUILDOUT INITIAL SF DEDICATED TO VIRGINIA TECH EXPECTED ANNUAL STEM MASTER'S DEGREES 2020 Q1 2021 $1B 675K SF 750 Virginia Tech Innovation Cam

  16. Slide 16: Demand Catalysts in National Landing: Smart City Initiative

    DEMAND CATALYSTS IN NATIONAL LANDING: SMART CITY INITIATIVE 16 ACCELERATE 5G ROLLOUT AND OTHER CONNECTIVITY ENHANCEMENTS WITH BEST-IN-CLASS TECHNICAL PARTNERS

  17. Slide 17: Substantial Growth Opportunity: Operating Portfolio

    SUBSTANTIAL GROWTH OPPORTUNITY: OPERATING PORTFOLIO 17 EXISTING OPERATING PORTFOLIO EXPECTED TO BENEFIT FROM NATIONAL LANDING GROWTH CATALYSTS OPERATING PORTFOLIO HIGHLIGHTS commercial portfolio 11.1M SF multifamily portfolio 5,999 units weighted average lease term (5.1 years in National Landing) 6.

  18. Slide 18: Substantial Growth Opportunity: Recent Deliveries

    SUBSTANTIAL GROWTH OPPORTUNITY: RECENT DELIVERIES 18 1770 Crystal Drive Commercial National Landing Q4 2020 100% 98.3%(1) (1) Office portion of 1770 Crystal Drive is 100% leased to Amazon. USE: SUBMARKET: COMPLETION: OWNERSHIP: LEASED %: 7900 Wisconsin Avenue Multifamily Bethesda CBD Q1 2021 50.0% N

  19. Slide 19: Substantial Growth Opportunity: Development Pipeline

    SUBSTANTIAL GROWTH OPPORTUNITY: DEVELOPMENT PIPELINE 19 EXTENSIVE 15.6M SF DEVELOPMENT PIPELINE - 76% MULTIFAMILY IN ADDITION TO DEVELOPMENT, WE MAY UNLOCK VALUE THROUGH OPPORTUNISTIC ASSET SALES, GROUND LEASES, AND RECAPITALIZATIONS Oce 24% Near-Term Development 5.6M SF Multifamily 76% DEVELOPMENT

  20. Slide 20: Substantial Growth Opportunity: Shifting Portfolio Mix

    SUBSTANTIAL GROWTH OPPORTUNITY: SHIFTING PORTFOLIO MIX 20 - 2,000,000 4,000,000 6,000,000 8,000,000 10,000,000 12,000,000 14,000,000 16,000,000 18,000,000 July 2017 Q3 2020 Square Footage Operating Commercial Operating Multifamily OPPORTUNISTICALLY SHIFT PORTFOLIO TO MAJORITY MULTIFAMILY OVER TIME 3

  21. Slide 21: Capital Allocation

    CAPITAL ALLOCATION 21 SINCE ITS INCEPTION, JBG SMITH HAS SOLD OR RECAPITALIZED NEARLY $1.6B OF ASSETS AT OR ABOVE NAV 3 New investments will be balanced with maintaining liquidity and prudent leverage Continued focus on office dispositions and monetizing land through ground leases to third-parties 2

  22. Slide 22: Robust Balance Sheet

    ROBUST BALANCE SHEET 22 $1.7B OF LIQUIDITY TO WITHSTAND HEADWINDS AND CAPITALIZE ON INVESTMENT OPPORTUNITIES (1) Total Enterprise Value is based on the closing price per share of $31.27 as of December 31, 2020. (2) Adjusting for estimates of the amounts management believes to be attributable to the

  23. Slide 23: Attractive Entry Point into JBG SMITH

    ATTRACTIVE ENTRY POINT INTO JBG SMITH 23 -19.1% -31.3% -0.2% Performance vs. O ce Sector and Multifamily Sector Peers From November 13, 2018 – October 30, 2020 Cumulative Performance vs. O ce and Multifamily Peers Notes: 1. Includes BXP, DEI, ESRT, KRC, PGRE, SLG, VNO, WRE 2. Includes AVB, CPT, EQR,

  24. Slide 24: Appendix

    o) APPENDIX

  25. Slide 25: JBG SMITH at a Glance

    JBG SMITH AT A GLANCE 25 1900 N Street 11.1M 274K 5.6M SF 5,999 161 COMMERCIAL SF COMMERCIAL SF MULTIFAMILY UNITS MULTIFAMILY UNITS OPERATING PORTFOLIO UNDER-CONSTRUCTION NEAR-TERM DEVELOPMENT 10.0M SF FUTURE DEVELOPMENT PIPELINE 83 9.2x NET DEBT/ANNUALIZED ADJUSTED EBITDA(2) WALK SCORE 97% 32.0% NE

  26. Slide 26: Q4 2020 Operating Commercial Portfolio Performance

    Q4 2020 OPERATING COMMERCIAL PORTFOLIO PERFORMANCE 26 COVID-19 DRIVEN INCOME STREAM DECLINES PARTIALLY OFFSET BY THE BURN OFF OF FREE RENT LEASE EXPIRATION SCHEDULE(1) Q4 2020 PERFORMANCE COMMERCIAL PORTFOLIO MIX(2) (1) Excludes lease extension options, except where reasonably certain. (2) Based on

  27. Slide 27: Q4 2020 Operating Multifamily Portfolio Performance

    Q4 2020 OPERATING MULTIFAMILY PORTFOLIO PERFORMANCE 27 WHILE MARKET DEMAND REMAINS BELOW PRE-PANDEMIC LEVELS, RECOGNIZED OCCUPANCY GAINS IN Q4 2020 · Generated $56.6M of Annualized NOI in Q4 2020 versus $82.4M in Q4 2019 · Decline primarily due to lower occupancy, lower net effective rents, higher o

  28. Slide 28: 4Q20 Office Market Delivery Pipeline

    4Q20 OFFICE MARKET DELIVERY PIPELINE 28 Total Under Construction: 6.1M 3.0M 3.1M 0.0 1.0 2.0 3.0 4.0 5.0 6.0 2014 2015 2016 2017 2018 2019 2020 2021 2022 Square Feet (M) Delivered as of Q4 2020 Under Construction as of Q4 2020 OFFICE DELIVERIES ARE SLOWING IN THE NEAR-TERM, WITH NO NEW STARTS IN Q4

  29. Slide 29: Office Fundamentals – 4Q19 vs. 4Q20

    OFFICE FUNDAMENTALS – 4Q19 VS. 4Q20 29 VACANCY HAS INCREASED IN ALL JURSIDCTIONS THROUGHOUT 2020, RESULTING IN METRO-WIDE NEGATIVE ABSORPTION OF 5.2M SF Source: JLL (1) Reflects "direct" metrics (excludes subleased space). (2) Total Vacancy includes sublease and direct vacancy. -414 -1,281 -462 -1,5

  30. Slide 30: Office Investment Sales

    OFFICE INVESTMENT SALES 30 WHILE SALES VOLUME WAS DOWN SIGNIFICANTLY, TRANSACTIONS WERE EVENLY DISTRIBUTED THROUGHOUT 2020 Source: JLL $4.0 $5.1 $2.9 $4.6 $4.6 $4.1 $1.7 $0.3 $0.7 $1.9 $1.2 $0.9 $1.5 $0.5 $2.0 $3.1 $2.0 $3.2 $2.5 $3.1 $2.0 $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 $7.0 $8.0 $9.0 $10.0 2014

  31. Slide 31: Multifamily Pipeline

    MULTIFAMILY PIPELINE 31 WITH UNDER 800 UNITS COMMENCING CONSTRUCTION IN Q4 2020, THE SHRINKING PIPELINE HAS BEEN COMPOUNDED BY PANDEMIC-DRIVEN DELAYS MULTIFAMILY DELIVERY PIPELINE 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 2017 2018 2019 2020 2021 2022 2023 Units Delivered as of Q4 2020 U

  32. Slide 32: Multifamily Fundamentals – 4Q19 vs. 4Q20

    MULTIFAMILY FUNDAMENTALS – 4Q19 VS. 4Q20 32 CONTINUED DECLINES IN BOTH CLASS A AND CLASS B OCCUPANCIES ARE DRIVING MARKET-WIDE DECLINES IN ASKING RENTS Class A Class B -9.0% -8.0% -7.0% -6.0% -5.0% -4.0% -3.0% -2.0% -1.0% 0.0% Q2 2020 - Q4 2020 Q4 2019 - Q4 2020 Q2 2020 - Q4 2020 Q4 2019 - Q4 2020 O

  33. Slide 33: Multifamily Investment Sales

    MULTIFAMILY INVESTMENT SALES 33 DESPITE THE PANDEMIC, SALES VOLUME WAS LARGELY CONSISTENT WITH LEVELS PRIOR TO 2019, A PARTICULARLY STRONG YEAR FOR SALES Source: CoStar DC Total Sales MD Total Sales NoVa Total Sales $0.9 $1.1 $0.3 $0.5 $0.5 $0.9 $0.3 $1.0 $1.9 $2.1 $0.8 $1.2 $2.1 $0.8 $0.9 $4.1 $1.3

  34. Slide 34: Commitment to ESG Best Practices

    COMMITMENT TO ESG BEST PRACTICES 34 4 Built a replicable model that can be used by other communities 1 Launched the Washington Housing Initiative (WHI) in 2018 to build or maintain up to 3,000 units of affordable workforce housing ALIGNED BUSINESS PRACTICES WITH RESPONSIBLE DEVELOPMENT AND SUSTAINAB

  35. Slide 35: Management and Board of Trustees Update

    MANAGEMENT AND BOARD OF TRUSTEES UPDATE PHYLLIS CALDWELL Independent Trustee 35 WE ARE PLEASED TO ANNOUNCE THREE PROMOTIONS TO OUR LEADERSHIP TEAM AND WELCOME A NEW TRUSTEE TO OUR BOARD MOINA BANERJEE Chief Financial Officer GEORGE XANDERS Chief Investment Officer CAREY GOLDBERG Chief Human Resource

  36. Slide 36: Disclosures: Definitions

    DISCLOSURES 36 DEFINITIONS DEVELOPMENT PIPELINE "Development pipeline" refers to the near-term development pipeline and future development pipeline. EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION ("EBITDA"), EBITDA FOR REAL ESTATE ("EBITDARE") AND "ADJUSTED EBITDA" Earnings Before In

  37. Slide 37: Disclosures: Definitions

    DISCLOSURES 37 DEFINITIONS GAAP "GAAP" means United States generally accepted accounting principles. IN-SERVICE "In-service" refers to commercial or multifamily assets that are at or above 90% leased or have been operating and collecting rent for more than 12 months as of December 31, 2020. JBG SMIT

  38. Slide 38: Definitions

    DEFINITIONS 38 We also report adjusted annualized NOI which includes signed but not yet commenced leases and incremental revenue from recently delivered assets assuming stabilization. While we believe adjusted annualized NOI provides useful information regarding potential future NOI from our assets,

  39. Slide 39: Definitions

    DEFINITIONS 39 SQUARE FEET OR "SF" "Square feet" or "SF" refers to the area that can be rented to tenants, defined as (i) for commercial assets, rentable square footage defined in the current lease and for vacant space the rentable square footage defined in the previous lease for that space, (ii) fo

  40. Slide 40: EBITDA, EBITDAre and Adjusted EBITDA (Non-GAAP)

    DISCLOSURES 40 EBITDA, EBITDAre AND ADJUSTED EBITDA (NON-GAAP) (UNAUDITED) Note: All EBITDA measures as shown above are attributable to common limited partnership units (“OP Units”). (1) Interest expense includes the amortization of deferred financing costs and the ineffective portion of any interes

  41. Slide 41: NOI Reconciliations (Non-GAAP)

    DISCLOSURES 41 NOI RECONCILIATIONS (NON-GAAP) (UNAUDITED) (1) Adjustment to exclude straight-line rent, above/below market lease amortization and lease incentive amortization. (2) Adjustment to include other revenue and payments associated with assumed lease liabilities related to operating properti

  42. Slide 42: JBG SMITH

    Oo JBG SMITH

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