W. P. Carey Inc. Reit · NYSE:WPC
W. P. Carey Inc. Reit — Q2 2020 Earnings Presentation
27 slides from W. P. Carey Inc. Reit's earnings presentation, Jul 31, 2020
Slide 1: W. P. Carey Inc. Investor Presentation 2Q20
W. P. Carey Inc. Investor Presentation 2Q20 Investing for the long run®
Slide 2: Table of Contents
Investing for the long run® Table of Contents 1. Overview 2. Real Estate Portfolio 3. Balance Sheet 4. Investment Management Unless otherwise noted, all data in this presentation is as of June 30, 2020. Amounts may not sum to totals due to rounding.
Slide 3: 1. Overview
WP. CAREY aii ek? i 7 : a a . as CI "4 | oes |e cee eee © 1. Overview 5 ' 3 ere Tih,
Slide 4: Company Highlights
Company Highlights W. P. Carey (NYSE: WPC) is a REIT that specializes in investing in net lease commercial real estate, primarily in the U.S. and Northern and Western Europe One of the largest owners of net lease assets and among the top 20 REITs in the MSCI US REIT Index Highly diversified portfoli
Slide 5: Business Model and Structure
Business Model and Structure (1) W. P. Carey is an internally-managed net lease REIT Public REIT (NYSE: WPC) ~$18 billion of Enterprise Value (2) Real Estate Portfolio (3) Advisor to $2.7 billion of AUM (4) 1,216 net lease properties / 142 million sq. ft. / 10.7 year WALT / $1.1 billion of ABR Corpo
Slide 6: Investment Strategy
Investment Strategy • Generate attractive risk-adjusted returns by Transactions Evaluated on Four Key Factors identifying and investing in net-lease commercial real estate, primarily in the U.S. and Northern & • Industry drivers and trends Western Europe Creditworthiness • Competitor analysis • Prot
Slide 7: Proactive Asset Management
Proactive Asset Management Domestic and international asset management capabilities to address lease expirations, changing tenant credit profiles and asset repositioning or dispositions • Asset management offices in New York and Amsterdam • W. P. Carey has proven experience repositioning assets thro
Slide 8: 2. Real Estate Portfolio
WP. CAREY 2. Real Estate Portfolio
Slide 9: Large Diversified Portfolio
Large Diversified Portfolio (1) Number of Properties 1,216 Number of Tenants 352 Square Footage 142 million ABR $1.1 billion US / Europe / Other (% of ABR) 63% / 35% / 2% Contractual Rent Escalation: CPI-linked / Fixed / Other 62% / 33% / 4% WALT 10.7 years Occupancy 98.9% Investment Grade Tenants (
Slide 10: Property and Industry Diversification
Property and Industry Diversification (1) By Property Type (% of ABR) By Tenant Industry (% of ABR) 9% 15% 5% 24% 22% 3% 3% 3% 17% 4% 9% 4% 4% 22% 7% 4% 23% 4% 5% 5% 5% 5% 46% Retail Stores (2) 22% Industrial / Warehouse Consumer Services 9% Automotive 7% Industrial 24% Cargo Transportation 5% Busin
Slide 11: Top Ten Tenants
Top Ten Tenants (1) One of the lowest Top 10 concentrations among the net lease peer group Number of ABR WALT % of Tenant Description Properties ($ millions) (years) Total Net lease self-storage properties in the U.S. 78 $39 3.8 3.4% Do-it-yourself retail properties in Germany 42 33 16.7 2.9% Govern
Slide 12: Geographic Diversification
Geographic Diversification (1) W. P. Carey has been investing internationally for 22 years, primarily in Northern and Western Europe Other (2), 2%, $23MM Europe, 35% $392 MM United States, 63%, $719 MM (1) Portfolio information reflects pro rata ownership of real estate assets (excluding operating p
Slide 13: Internal Growth from Contractual Rent Increases
Internal Growth from Contractual Rent Increases (1) Approximately 99% of leases have contractual rent increases, including 62% linked to CPI None, 0.8% (2) Other, 4% Uncapped Fixed, 33% CPI, 39% 62% CPI-linked CPI-based, 23% (1) Portfolio information reflects pro rata ownership of real estate assets
Slide 14: Same-Store ABR Growth
Same-Store ABR Growth Contractual same store growth of 1.9% Contractual Same Store Growth 2.2% 2.2% 2.0% 2.0% 1.9% 1.8% 1.8% 1.6% 1.6% 1.6% 1.5% 1.5% 1.5% 1.4% 1.4% 1.2% 1.0% 0.8% 0.6% 0.4% 0.2% 0.0% 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 (1) Contractual same store portfolio includes leas
Slide 15: Lease Expirations and Average Lease Term
Lease Expirations and Average Lease Term (1) Weighted average lease term of 10.7 years Lease Expirations (% ABR) (2) 53.4% 50% 40% 30% 20% 9.9% 10% 6.4% 5.3% 4.6% 5.4% 4.2% 4.2% 3.2% 2.6% 0.8% 0% Remaining 2021 2022 2023 2024 2025 2026 2027 2028 2029 Thereafter 2020 (1) Portfolio information reflect
Slide 16: Historical Occupancy
Historical Occupancy (1) Stable occupancy maintained during the credit crisis and economic downturn Occupancy (% Square Feet) (2) 100% 98.5% 98.4% 98.8% 99.0% 99.2% 99.3% 99.8% 98.3% 98.9% 98.9% 97.1% 96.6% 97.3% 80% 60% 40% 20% 0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 (1)
Slide 17: Recent Acquisitions – Case Studies
Recent Acquisitions – Case Studies Completed investments totaling $2.2 billion since the beginning of 2018 • Comprises $1.8 billion on-balance-sheet acquisitions and $454 million of capital investment projects Recent Acquisitions DSG International Stanley Black & Decker Stark Group A/S January 2020
Slide 18: Capital Investment Projects – Case Studies
Capital Investment Projects – Case Studies Capital investment projects have become a more meaningful part of our investment activity • Completed on-balance-sheet capital investment projects totaling $148 million in 2Q20 • An additional $171 million of development projects in process as of June 30, 2
Slide 19: 3. Balance Sheet
WP. CAREY 3. Balance Sheet
Slide 20: Balance Sheet Overview
Balance Sheet Overview Capitalization (%) Capitalization ($MM) 6/30/20 2% Total Equity (1) $11,764 Pro Rata Net Debt 9% (1) Equity 65% Senior Unsecured Notes USD 1,625 Senior Unsecured Notes 24% 24% Senior Unsecured Notes EUR 2,800 65% Mortgage Debt, pro rata USD 1,189 Mortgage Debt (pro rata) 9% Mo
Slide 21: Debt Maturity Schedule
Debt Maturity Schedule Principal at Maturity 1,400 Mortgage (1)(3) Unsecured (2)(3) Unsecured (3) Unsecured (3) Unsecured (3) Debt Bonds (EUR) Bonds (USD) Term Loan Revolver 1,200 1,000 500 22 800 350 $MM 292 600 560 560 400 450 560 560 560 200 418 346 325 241 179 32 110 86 21 0 (1) 2020 2021 2022 2
Slide 22: Unsecured Bond Covenants
Unsecured Bond Covenants (1) Investment grade balance sheet with Baa2/stable rating from Moody’s and BBB/stable rating from S&P Senior Unsecured Notes (2) Metric Covenant June 30, 2020 Total Debt / Total Leverage ≤ 60% 40.9% Total Assets Secured Debt / Secured Debt Leverage ≤ 40% 9.5% Total Assets C
Slide 23: Dividends per Share
History of Consistent Dividend Growth W. P. Carey has increased its dividend every year since going public in 1998 • Current annualized dividend of $4.17 with a yield of 6.2% (1) • Conservative and stable payout ratio since conversion to a REIT in September 2012 Dividends per Share (2) $5.00 $4.14 $
Slide 24: 4. Investment Management
WP. CAREY 4. Investment Management
Slide 25: Summary of Non-Traded Investment Programs
Summary of Non-Traded Investment Programs Total AUM of $2.7 billion, including $1.4 billion of net lease AUM • CWI 1 and CWI 2 merged and internalized management in April 2020 • Closed merger with CPA:17 in October 2018 • Exited non-traded retail fundraising in June 2017 CPA:18 CESH Student Investme
Slide 26: Cautionary Statement Concerning Forward-Looking Statements
Cautionary Statement Concerning Forward-Looking Statements Certain of the matters discussed in this communication constitute forward-looking statements within the meaning of the Securities Act of 1933 and the Exchange Act of 1934, both as amended by the Private Securities Litigation Reform Act of 19
Slide 27: Disclosures
Disclosures The following non-GAAP financial measures are used in this presentatio EBITDA and Adjusted EBITDA We believe that EBITDA is a useful supplemental measure to investors and analysts for assessing the performance of our business segments because (i) it removes the impact of our capital stru
W. P. Carey Inc. REIT — Q2 2020 Earnings Presentation on 6ix