Jernigan Capital — Investor Presentation (April 2019)
31 slides from Jernigan Capital's investor presentation, Apr 1, 2019
Slide 1: Investor Presentation April 2019
April 2019 Investor Presentation INVESTOR PRESENTATION April 2019 JERNIGAN CAPITAL 6410 Poplar Ave, Suite 650 Memphis, TN 38119
Slide 2: Safe Harbor Disclosure Regarding Forward-Looking Statements
April 2019 Investor PresentationSAFE HARBOR DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS This presentation includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and other federal securities laws
Slide 3: Introduction: Our Mission
April 2019 Investor PresentationINTRODUCTION OUR MISSION OUR TICKER SYMBOL Jernigan Capital provides debt and equity capital to private developers, owners and operators of self-storage facilities with a view toward eventual outright ownership of facilities we finance. Our mission is to maximize shar
Slide 4: Recent Events
April 2019 Investor PresentationRECENT EVENTS The following events occurred during the year-to-date 2019: 4 .. 1/18/2019: The Company entered into a secured term loan for $9.2 million secured by a first mortgage on its wholly-owned Charlotte 1 facility. .. 1/28/2019: The Company’s joint venture with
Slide 5: Investment Highlights
April 2019 Investor Presentation .. $350+ million pipeline of investments in underwriting .. Increasing short-term opportunity to acquire full ownership of existing projects as 2017 investments are completed and leasing up .. Bridge and other creative financing structures provide additional acquisit
Slide 6: Experienced and Aligned Senior Management Team
April 2019 Investor PresentationEXPERIENCED AND ALIGNED SENIOR MANAGEMENT TEAM ~8.0% Management and Board Ownership Creates Significant Alignment of Interests ~7% MANAGEMENT AND BOARD OWNERSHIP CREATES SIGNIFICANT ALIGNMENT OF INTERESTS .. 32+ years in the self- storage industry .. Invested over $3
Slide 7: JCAP's Competitive Advantage
April 2019 Investor PresentationJCAP’S COMPETITIVE ADVANTAGE CREATIVE INVESTMENT STRUCTURES PROVIDE ONE-STOP SHOP .. Development financing of up to 97% loan-to-cost (“LTC”). Banks offer 60% to 65% .. JCAP can offer flexible financing structures on both development projects and projects in lease-up .
Slide 8: High ROI Business Model Executed in Top Self-Storage Markets
April 2019 Investor PresentationHIGH ROI BUSINESS MODEL EXECUTED IN TOP SELF-STORAGE MARKETS ATTRACTIVE RISK-ADJUSTED RETURNS THROUGH EQUITY PARTICIPATION DEVELOPMENT INVESTMENTS Ground-up Construction | Major Redevelopment .. Focus on programmatic self-storage development of Generation V facilities
Slide 9: Development Project Investment Timeline
April 2019 Investor PresentationDEVELOPMENT PROJECT INVESTMENT TIMELINE .. Below is a timeline for a typical development project. JCAP investment targets include: .. Targeted investment yield of at least 300bps above prevailing stabilized cap rate .. Investment equal to 90% of total cost with fixed
Slide 10: Selective Underwriting
April 2019 Investor PresentationSELECTIVE UNDERWRITING (1) Represents closed loan commitments and wholly-owned property investments as of 3/24/19, including closed investments that have been repaid. STRINGENT UNDERWRITING PROCESS BASED ON MANAGEMENT’S EXTENSIVE EXPERIENCE AND SUCCESSFUL TRACK RECORD
Slide 11: Predictable Dividend That Tracks Value Creation
April 2019 Investor Presentation 1.6x 2.8x 2.6x 2.0x 0.6x 1.6x 1.0x 0.7x 1.0x 1.8x 2.1x 3.0x 1.7x 1.3x 0.0x 0.5x 1.0x 1.5x 2.0x 2.5x 3.0x 3.5x 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q16-4Q18 2019E AEPS Coverage PREDICTABLE DIVIDEND THAT TRACKS VALUE CREATION (1) Quarterly dilut
Slide 12: High Quality Self-Storage Properties in Attractive Markets
April 2019 Investor PresentationHIGH QUALITY SELF-STORAGE PROPERTIES LOCATED IN ATTRACTIVE MARKETS Note: Percentages and Company’s market average are weighted based on committed total investment amounts. | (1) Source: Census Bureau. | (2) Other markets include Austin, Baltimore, Charlotte, Columbia,
Slide 13: Portfolio Overview
April 2019 Investor Presentation Notes: Percentage of portfolio based on committed total investment amounts. Portfolio overview statistics exclude pipeline investments, including those with executed term sheets. | (1) Represents closed loan commitments and wholly-owned property investments as of 3/2
Slide 14: Current Portfolio and Investment Pipeline
April 2019 Investor Presentation 14 CURRENT PORTFOLIO AND INVESTMENT PIPELINE Note: As of 12/31/2018. Boston Los Angeles Washington, DCKansas City New Haven-Stamford New York City-Northern NJ Philadelphia Tampa Baltimore Miami Atlanta Orlando Minneapolis Jacksonville Houston Austin New Orleans Knoxv
Slide 15: Business Model Proven from Origination to Acquisition
April 2019 Investor PresentationBUSINESS MODEL PROVEN FROM ORIGINATION TO ACQUISITION (1) Funded principal balance of the loan (net of unamortized origination fees) as of the date of acquisition. | (2) Represents cash consideration (inclusive of transaction costs), assumed liabilities, and net prope
Slide 16: Wholly-Owned Properties
April 2019 Investor PresentationWHOLLY-OWNED PROPERTIES (1) Stabilized yield represents projected stabilized NOI divided by JCAP capital investment. JCAP capital investment represents the sum of the funded principal balance of the loan (net of unamortized origination fees), cash consideration (inclu
Slide 17: Miami Bridge Investment
April 2019 Investor PresentationMIAMI BRIDGE INVESTMENT (1) The two projects that were under construction at close will each also pay a $1 million preferred return to the developer after payment to JCAP of the PIK interest and before the 49.9% profits interest split. | (2) Physical occupancy as of 3
Slide 18: JCAP Capital Sources and Investment Uses
April 2019 Investor PresentationJCAP CAPITAL SOURCES AND INVESTMENT USES (1) Does not include financing spend or operating cash flow. | (2) Assumes increase in the availability under the Credit Facility. As of December 31, 2018, $91.3 million was available for borrowing under the Credit Facility, an
Slide 19: Contact
April 2019 Investor PresentationCONTACT JERNIGAN CAPITAL JERNIGAN CAPITAL, INC investorrelations@jernigancapital.com 6410 Poplar Ave, Suite 650 Memphis, TN 38119 www.jernigancapital.com 19
Slide 20: Appendix
April 2019 Investor Presentation APPENDIX
Slide 21: Portfolio Detail
April 2019 Investor PresentationPORTFOLIO DETAIL Note: Represents portfolio as of 12/31/2018. | (1) JCAP Capital Investment represents the sum of the funded principal balance of the loan (net of unamortized origination fees), cash consideration (inclusive of transaction costs), assumed liabilities,
Slide 22: Portfolio Detail – Continued
April 2019 Investor PresentationPORTFOLIO DETAIL – CONTINUED 22 Note: Represents portfolio as of 12/31/2018. | (1) Represents principal balance of loan gross of origination fees. | (2) Construction at the facility was substantially complete and/or certificate of occupancy had been received as of 12/
Slide 23: Portfolio Detail – Continued
April 2019 Investor Presentation Current Portfolio $ in 000s Remaining Unfunded Closing Date Location (MSA) Investment Type Status (4) Commitment Funded Investment (1) Commitment Fair Value REIT Level Investments - as of 12/31/2018 7/27/2017 Jacksonville 3 (2) Development C/O achieved Nov. 2018 $8,0
Slide 24: Portfolio Detail – Continued
April 2019 Investor PresentationPORTFOLIO DETAIL – CONTINUED 24 Note: Represents portfolio as of 12/31/2018. | (1) Represents principal balance of loan gross of origination fees. | (2) Construction at the facility was substantially complete and/or certificate of occupancy had been received as of 12/
Slide 25: Portfolio Detail – Continued
April 2019 Investor PresentationPORTFOLIO DETAIL – CONTINUED Note: Represents portfolio as of 12/31/2018. | (1) Represents principal balance of loan gross of origination fees. | (2) Construction at the facility was substantially complete and/or certificate of occupancy had been received as of 12/31/
Slide 26: JCAP Is an Equity REIT, Not a Mortgage REIT
April 2019 Investor PresentationJCAP IS AN EQUITY REIT, NOT A MORTGAGE REIT TYPICAL MORTGAGE REIT .. Higher corporate leverage, including leverage of junior debt .. No equity participation .. Structured finance arbitrage rather than property focus .. Communication with borrowers only when problems o
Slide 27: Heitman Capital Management Joint Venture Overview
April 2019 Investor PresentationHEITMAN CAPITAL MANAGEMENT JOINT VENTURE OVERVIEW HEITMAN JOINT VENTURE IS FULLY COMMITTED JV Partner Heitman Capital Management LLC Initial Investment Structure 90% Heitman / 10% JCAP Current JV Commitment $133.2 million (including capital investment in the four prop
Slide 28: Highland Capital Series A Preferred Overview
April 2019 Investor PresentationHIGHLAND CAPITAL SERIES A PREFERRED OVERVIEW Investor Funds managed by NexPoint Advisors, L.P. Structure of the Investment Series A Preferred Stock Investment Size Up to $125 million of equity capital through September 2018 Current Balance $125 million as of December
Slide 29: Term Loans Overview
April 2019 Investor PresentationTERM LOANS OVERVIEW Lender FirstBank Structure of the Investment Secured by first mortgages on four of JCAP’s wholly-owned self-storage facilities Investment Size $34.1 million Term Three years – August 2021 maturity date Cost of Capital Interest at floating variable
Slide 30: Series B Preferred Stock Overview
April 2019 Investor PresentationSERIES B PREFERRED STOCK OVERVIEW NYSE Symbol JCAP-PB Structure of the Investment Series B Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share with a liquidation preference of $25.00 per share Current Investment Size $39.3 million or 1,571,734 s
Slide 31: Credit Facility Overview
April 2019 Investor PresentationCREDIT FACILITY OVERVIEW Lead Lenders / Arrangers KeyBank Capital Markets, Inc., Raymond James Bank, N.A. and BMO Harris Bank N.A. Structure of the Investment Senior secured revolving credit facility Investment Size Up to $235 million debt capital, expandable up to $4
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