D/b/a Centerspace · NYSE:CSR
D/b/a Centerspace — Investors Real Estate Trust — NAREIT REITweek 2018
20 slides from D/b/a Centerspace's conference presentation, Jun 4, 2018
Slide 1: Investor Presentation – NAREIT REITweek June 2018
Investor Presentation NAREIT REITweek | New York, NY | June 2018 NYSE: IRET
Slide 2: Safe Harbor Statement and Legal Disclosure
SAFE HARBOR STATEMENT AND LEGAL DISCLOSURE Certain statements in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual resu
Slide 3: Company Snapshot
COMPANY SNAPSHOT Now Dedicated Multifamily Company Focused Management Team Drives Operating Efficiencies Single Segment Property Specialist Engaged to Effect Improvement G&A and Operating Expenses Strong Markets and Distinct Geography Improved Capital Structure Positions for Future Growth Combinatio
Slide 4: Repositioning Coming to Fruition
REPOSITIONING COMING TO FRUITION Delivering on stated goals and renewed business strategy Evolution of Business Strategy – Focus and Flexibility PAST PRESENT FUTURE Multifamily Multifamily 94% Multifamily Focus 31% Multifamily (% of NOI) 100% Leverage Leverage Leverage Leverage 45% 40% (% of Book Va
Slide 5: Capital Structure Overview as of 1/31/18
CAPITAL STRUCTURE OVERVIEW AS OF 1/31/18 $ in thousands, except where noted $1.6B Total Capitalization % of Weighted Weighted Debt Summary Amount Total Avg. Rate Avg. Maturity Total Secured Debt $555,875 80.2% 4.63% 4.5 Years $99M $693M Preferred Total Debt (1) Secured Unsecured LOC Balance $67,000
Slide 6: Today: A Premier Multifamily Company
TODAY We are a premier multifamily company delivering exposure to strong Midwest markets Minot Williston MT ND Grand Forks Billings Bismarck MN St. Cloud WI Rapid City SD Minneapolis Sioux Falls Rochester IA NE Omaha Denver CO Topeka KS Highlights Portfolio Evolution • 90 communities with 14,176 apa
Slide 7: Growth in Midwest Markets
GROWTH IN MIDWEST MARKETS Newer communities in the Midwest have shown strong performance since 2010 Rent Growth CAGR Revenue Growth CAGR For communities built since 2010 For communities built since 2010 4.1% 3.5% 3.9% 2.8% 3.1% 2.4% 2.2% 2.3% 1.6% 1.9% Midwest South West Northeast National Avg Midwe
Slide 8: Minneapolis–St. Paul Is Strong
MINNEAPOLIS–ST. PAUL IS STRONG Economic Drivers 19 Fortune 500 Companies • The Minneapolis–St. Paul economy is supported by large Rank Company Rank Company corporations in diverse industries that generate stable job 5 United Health Group 216 Land O' Lakes growth. Nineteen Fortune 500 companies and e
Slide 9: Denver's Economy Is Thriving
DENVER’S ECONOMY IS THRIVING Economic Drivers 130 Total Nonfarm Payrolls (SA 2010-present) Indexed to Jan 2010 = 100 26% • Denver’s advantageous location, livability, skilled workforce, 125 and attractiveness for doing business have prompted job creation throughout the metro area as employers reloca
Slide 10: Competitive with Coastal Markets
COMPETITIVE WITH COASTAL MARKETS The Twin Cities and Denver boast extremely tight job markets, characterized by a highly educated workforce % of Adult Population with Bachelor's Degree or Higher Unemployment Rate(1) Washington-Arlington-Alexandria, DC-VA-MD-WV MSA 50.2% San Francisco-Oakland-Hayward
Slide 11: Minneapolis & Denver vs. Other Top MSAs
MINNEAPOLIS & DENVER VS. OTHER TOP 25 MSAs Targeted Geography Has Strong Market Fundamentals DENVER 2010-2017 Population CAGR 1.77% Unemployment Rate 2.80% Median Household Income $71,926 Median Home Price $441,500 TWIN CITIES Multifamily % of Housing Stock(1) 26.8% 2010-2017 Population CAGR 1.01% 2
Slide 12: FY18 Investments
FY18 INVESTMENTS Westend Dylan Location: Denver, CO Location: Denver, CO Profile: Urban Core Profile: Urban Core Constructed: 2015 Constructed: 2016 Homes: 390 Homes: 274 Purchase Price: $128.7M Purchase Price: $90.6M Park Place Oxbo Location: Plymouth, MN Location: St. Paul, MN Profile: Suburban Va
Slide 13: Understanding Secondary Markets
UNDERSTANDING SECONDARY MARKETS These five markets plus Minneapolis and Denver are expected to make up 76% of proforma FY19 NOI Rochester, MN Omaha, NE Grand Forks, ND St. Cloud, MN Bismarck, ND Population 218,280 933,316 102,414 197,759 132,142 Median Household Income $70,078 $62,247 $48,671 $56,62
Slide 14: Capital Allocation Priorities
CAPITAL ALLOCATION PRIORITIES Prudent capital allocation provides greater opportunities to reinvest in and grow our business Continue Disciplined Investment Strategy • Improve portfolio efficiency and quality through targeted redevelopment of existing assets and new acquisitions • Continue active po
Slide 15: Catalysts for Upside
CATALYSTS FOR UPSIDE Portfolio and operational improvements can expand margins and create value Multifamily IRET Upside Potential REIT Peers • Operational efficiencies associated with economies of scale Homes / Community 155 303 • Favorable comparison to institutional quality portfolios • Improvemen
Slide 16: Portfolio Scale and Quality Improving
PORTFOLIO SCALE AND QUALITY IMPROVING Total Multifamily NOI Average Revenue / Home $1,407 $85M $1,079 $41M $724 FY 2012 TTM as of 1/31/18 FY 2012 Current (1) Current Non Same- Store(1) Multifamily Homes Operational Enhancements • Placing full focus on our residents and our communities 14,176 • Growi
Slide 17: Significant Value Add Opportunity
SIGNIFICANT VALUE ADD OPPORTUNITY OPPORTUNITY • Approximately 5,600 apartment homes haven’t been renovated since before 2008 • Inventoried entire portfolio for value add opportunities • Identified communities in good locations garnering rents significantly lower than newer assets in the market • Opp
Slide 18: Value Add Case Study – Park Place
VALUE ADD CASE STUDY – PARK PLACE Opportunity • Redevelop up to 488 homes at Park Place Apartments, a Class B BEFORE multifamily community located in a highly desirable suburb of Minneapolis • Take advantage of significant disparity between rents on newer, Class A product in the submarket and curren
Slide 19: Investment Highlights
Investment Highlights Strong Balance Sheet Strong Markets Operational Enhancements Value Add Opportunities Best in Class Governance www.iretapartments.com NAREIT REITweek | June 2018 19
Slide 20: Investor Relations Contact
Investor Relations Contact: Matthew Volpano SVP – Capital Markets ir@iret.com 701.837.7104