Vornado Realty Trust · NYSE:VNO
Vornado Realty Trust — NAREIT REITweek: 2019 Annual Conference
34 slides from Vornado Realty Trust's conference presentation, November 2019
Slide 1: Nareit Annual Conference November 2019
NAREIT ANNUAL CONFERENCE NOVEMBER 2019
Slide 2: Overview
OVERVIEW NEW YORK CITY FOCUSED BEST-IN-CLASS LEADING OPERATING ASSETS PLATFORM UNIQUE & SCALABLE FORTRESS BALANCE PENN DISTRICT SHEET OPPORTUNITY TRACK RECORD OF VALUE CREATION 1
Slide 3: Deep, Talented & Experienced Management Team
HEADER DEEP, TALENTED TEXT HERE & EXPERIENCED MANAGEMENT TEAM C O R P O R AT E OFFICERS ST E V E N R OT H MI C H A E L J. FR A N CO DAVI D R . G R E E NB AU M J OS E P H M AC NOW G L E N W E I SS B ARRY S. L A N GE R HA IM S. C HE R A Chairman of the Board President Vice Chairman Executive Vice Pres
Slide 4: New York City Is Our Home & Continues to Be a Magnet for Talent and Companies
NEW YORK CITY IS OUR HOME & CONTINUES TO BE A MAGNET FOR TALENT AND COMPANIES ECONOMIC GROWTH LABOR POOL • New York City has captured the greatest share • New York City has a growing population of of US (8.9%) and Global GDP (2.6%) of all cities educated individuals (net in-migration of 33K between
Slide 5: Rationale for Owning Vornado Stock
RATIONALE FOR OWNING VORNADO STOCK • Attractive common dividend yield of 4.0%1 • Trading at a significant discount to NAV • Deep, talented, proven management team • Fortress balance sheet with substantial cash and available liquidity (~$3.36 billion today and growing) to fund Penn District and take
Slide 6: Fortress Balance Sheet
FORTRESS BALANCE SHEET (Amounts in millions) SEPTEMBER 30, 2019 Secured debt $ 5,674 Unsecured debt 1,855 Pro rata share of non-consolidated debt 2,807 Less: noncontrolling interests' share of consolidated debt (484) Total debt 9,852 • Investment grade debt — Baa2/BBB Projected cash proceeds from 22
Slide 7: Components of Pro-Forma NOI at Share - Cash Basis
655 FIFTH 350 PAR West Broadway ROCKEFELLER CE 1601 BROADWAY 8th Av 7th Av 280 PARK HEADER TEXT HERE COMPONENTS OF PRO-FORMA NOI AT SHARE - CASH BASIS 1 TIMES SQUARE 608 FIFTH AVENUE GRAND CE 10th Av 11th Av 5th Av 510 FIFTH 330 MADISON 8th Av 9th Av v 12th A 7th Av W. 42nd St Broad Bryant Park TIME
Slide 8: Select New York City Office Properties
SELECT NEW YORK CITY OFFICE PROPERTIES PLAZA DISTRICT MIDTOWN 8 8 8 SE VE NTH AV EN UE 6 5 0 MA DIS O N AVEN UE 595 MA DIS O N AV ENU E 64 0 FI FT H AV ENU E 689 FI FT H AV ENU E 731 LEXINGTON AVENUE 1 290 AVENUE OF TH E AMERICAS PENN DISTRICT GRAND CENTRAL 7 W E ST 34 TH ST R EET P EN N 11 3 3 0 W
Slide 9: Select New York City Street Retail Properties
SELECT NEW YORK CITY STREET RETAIL PROPERTIES 689 FI FTH AVEN UE 6 40 F IF TH AVEN UE 6 55 FI FT H AV ENU E 697 FI FT H AV ENU E 666 FI FT H AV ENUE 51 0 FIFTH AVENUE 82 8 - 8 5 0 MADI S ON AV EN UE 595 MA DIS O N AVEN UE 6 50 MAD I SON AV ENU E 67 7 MAD I SON AV ENU E 150 W E ST 34 TH ST R EET 435
Slide 10: theMART
theMART theMART building (Chicago) – best example of contemporary office space outside of Silicon Valley. Transformed from a showroom building to the premier creative and tech hub in the Midwest, resulting in significant earnings growth and value creation • 3,674,000 SF building – 95.0% Occupancy at
Slide 11: 555 California Street
555 CALIFORNIA STREET 555 California Street – the franchise office building in San Francisco and arguably the most iconic building on the west coast. • 1,819,000 SF complex – 100.0% occupancy at 9/30/19 • 9/30/19 TTM Cash NOI (non-GAAP)1 of $60.9 million at share • In-place escalated rents average $
Slide 12: Nationally Recognized, Industry-Leading Sustainability Program
NATIONALLY HEADER TEXTRECOGNIZED, HERE INDUSTRY-LEADING SUSTAINABILITY PROGRAM SUSTAINABILITY 6-time Energy Star Partner of the Year; Sustained Excellence recipient 2019. SM Largest owner of LEED certified buildings in New York City with over 26 million square feet. All new commercial developments w
Slide 13: Where Talent Is Our Client
W H E R E TA L E N T IS OUR CLIENT w w w.v n o.c o m 12
Slide 14: The Penn District Is the Easiest Neighborhood to Get To
HEADER TEXT HERE THE PENN DISTRICT IS THE EASIEST NEIGHBORHOOD UPPER UPPER TO GET TO AND SITS WEST SIDE EAST SIDE IN THE EPICENTER OF MANHATTAN. QUEENS HELL’S Penn Station, including Moynihan Train Hall, is the KITCHEN MIDTOWN busiest transportation hub in North America. Home to TIMES the Long Islan
Slide 15: In Every Great Global City, the Most Valuable Real Estate Stands Atop the Major Transportation Hub
“IN EVERY GREAT GLOBAL CITY, THE MOST VALUABLE REAL ESTATE STANDS ATOP THE MAJOR TRANSPORTATION HUB.“ - JLL RESEARCH, 4/23/19 ONCE REDEVELOPED, THE VORNADO PENN DISTRICT HOLDINGS WILL JOIN THE LIST. 14
Slide 16: Real Estate on Top of Major Transit Hubs Commands Premium Rents
REAL ESTATE ON TOP OF MAJOR TRANSIT HUBS COMMANDS PREMIUM RENTS & THE HIGHEST VALUES H O N G KO N G I C C - KO W L O O N / W E S T KO W L O O N S TAT I O N T O K YO M I R A I N A T O W E R - S H I N J U K U S TAT I O N L O N D O N K I N G ’ S C R O S S - K I N G ’ S C R O S S / S T PA N C R A S S TA
Slide 17: The Penn District
THE PENN DISTRICT THE EPICENTER OF THE NEW NEW YORK 39TH STREET UNIQUE VALUE CREATION OPPORTUNITY 650,000 38TH STREET RIDERS PER DAY • Existing office leasable space of 6.8MM SF with average in-place rents of $67 PSF(1) • Hudson Yards to the west asking rents range from $98-225 PSF(1) 37TH STREET •
Slide 18: Transformation of the Penn District Is Underway
TRANSFORMATION OF THE PENN DISTRICT IS UNDERWAY 17
Slide 19: Development Timeline
DEVELOPMENT TIMELINE 2020 2021 2022 FUTURE EXPECTED COMPLETION DATE: PENN 15 260 ELEVENTH OTHER PENN DISTRICT DEVELOPMENT OPPORTUNITIES 18
Slide 20: Active Development/Redevelopment Summary
THE PENN DISTRICT HEADER TEXT HERE ACTIVE DEVELOPMENT/REDEVELOPMENT SUMMARY - AS OF SEPTEMBER 30, 2019 (Amounts in thousands, except square feet) Capital to fund these projects comes entirely from 220 CPS proceeds PROPERTY AMOUNT REMAINDER TO STABILIZATION PROJECTED ACTIVE PENN DISTRICT PROJECTS BUD
Slide 21: Significant Dry Powder Available for Current Pipeline & Future Investments
SIGNIFICANT DRY POWDER AVAILABLE FOR CURRENT PIPELINE & FUTURE INVESTMENTS (Amounts in thousands) PENN 15 260 ELEVENTH 220 CPS REMAINING DISTRICTWIDE NET PROCEEDS IMPROVEMENTS PENN 2 COST 1,787,000 TO COMPLETE INVESTMENT 95,000 OPPORTUNITIES 716,000 PENN 1 COST TO COMPLETE FARLEY COST 268,000 TO COM
Slide 22: Farley
FARLEY UNIQUE HORIZONTAL CAMPUS DIRECTLY ON TOP OF TRANSPORTATION 21
Slide 23: Farley: Office Interiors & Rooftop Park
FARLEY OFFICE INTERIORS & ROOFTOP PARK 22
Slide 24: PENN 1: 34th Street Entrance
PENN 1 34TH STREET ENTRANCE 23
Slide 25: PENN 1: Lobby, Amenity Space & Plaza33
PENN 1 LOBBY, AMENITY SPACE & PLAZA33 24
Slide 26: PENN 2: Transformative Redevelopment
PENN 2 TRANSFORMATIVE REDEVELOPMENT 25
Slide 27: PENN 2: Redevelopment Features
PENN 2 REDEVELOPMENT FEATURES New rooftop terrace New penthouse duplex Two exterior loggias New modern curtain wall located on all floors Two Bustle floors, 44,000 RSF each, featuring double height ceilings and column free space New 4,000 SF town hall space New triple height lobby located off of 33r
Slide 28: PENN 2: 7th Avenue & 33rd Street Lobby
PENN 2 7TH AVENUE & 33RD STREET LOBBY 27
Slide 29: Appendix
AP PENDI X 28
Slide 30: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES This investor presentation contains certain non-GAAP financial measures, including net operating income (“NOI”) and earnings before interest, taxes, depreciation and amortization (“EBITDA”). NOI represents total revenues less operating expenses. We consider NOI to be the
Slide 31: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS (Amounts in millions) Reconciliation of Net income attributable to the Operating Partnership to EBITDA and EBITDA, as adjusted for the trailing twelve months ended September 30, 2019 For the TTM September 30, 2019 Net income attributable to the Operating Partnership $ 3,259
Slide 32: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS (Amounts in millions) Reconciliation of Net income to Pro-Forma NOI at share - Cash Basis for the Pro-Forma NOI at share - Cash Basis by segment: trailing twelve months ended September 30, 2019 For the For the TTM Ended TTM Ended September 30, 2019 September 30, 2019 Net inc
Slide 33: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS (Amounts in millions) Reconciliation of theMART Net income to EBITDA, NOI - Cash Basis and NOI - Cash Basis as adjusted for the year ended December 31, 2011 and for the trailing twelve months ended September 30, 2019 For the TTM Ended For the Year Ended September 30, 2019 De
Slide 34: Nareit Annual Conference November 2019
NAREIT ANNUAL CONFERENCE NOVEMBER 2019
Vornado Realty Trust — NAREIT REITweek: 2019 Annual Conference on 6ix