Sila Realty Trust, Inc. · NYSE:SILA
Sila Realty Trust — Nareit REITweek 2024
34 slides from Sila Realty Trust's conference presentation, May 31, 2024
Slide 1: Skillful and Thoughtful Investing - Nareit REITweek Company Presentation
Skillful and Thoughtful Investing Nareit REITweek Company Presentation June 2024
Slide 2: Disclosures: Forward Looking Statements and Non-GAAP Measures
Disclosures Forward Looking Statements Certain statements contained herein, other than historical fact, may be considered “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and
Slide 3: Sila Realty Trust is a net lease healthcare REIT
Sila Realty Trust is a net lease REIT specializing in institutional quality healthcare properties with a ‘Shareholder First’ mentality. We’re a pure-play investor in real estate properties across the healthcare continuum of services. Applying a core sector asset approach, we believe Sila offers inve
Slide 4: Introductions
Introductions Michael A. Seton President and Chief Executive Officer Founder and Board Member Kay C. Neely Executive Vice President and Chief Financial Officer Christopher K. Flouhouse Executive Vice President and Chief Investment Officer Miles F. Callahan Senior Vice President Capital Markets and I
Slide 5: Sila Realty Trust At a Glance
Portfolio Highlights Financial Highlights 20.5% Net Debt Leverage Ratio(3) 3.0x Net Debt to EBITDAre Ratio $590 M Liquidity(4) Sila Realty Trust At a Glance Sila Realty Trust, Inc. is a net lease REIT with a strategic focus on investing in the significant, growing, and resilient healthcare sector of
Slide 6: Key Investment Themes
Key Investment Themes Pure-Play in High-Quality Healthcare Assets Net lease in the defensive healthcare sector which limits high capital costs of real estate ownership and allows macro tailwinds 1 Proven Track Record of Value Creation Core sector asset investor with a history of accretive acquisitio
Slide 7: Pure-Play Net Lease REIT Focused on High-Quality Healthcare Assets
Healthcare trends are shifting patients to cost-effective, easy-to-access, healthcare settings, driving our demand for strategic asset classes along the healthcare continuum. Highest Acuity (Highest Cost Settings) Lowest Acuity (Lowest Cost Settings) Surgical and Specialty Facilities Acute Care Post
Slide 8: Large Growing Market in a Defensible Sector
Large Growing Market in a Defensible Sector1 Capitalizing on favorable macro tailwinds driving demand for healthcare settings that are cost efficient while delivering personalized, quality of care. (1) U.S. Census Bureau (2) Center for Medicaid and Medicare Services (3) Peterson-KFF analysis of 2021
Slide 9: Investment criteria and in-house management
• On-campus or off-campus facilities in retail-type locations • Strong visibility and access with ample parking • High growth areas near population clusters that are convenient to patients/customers • Near and convenient to the tenant’s patient referral sources • Large patient catchment areas • Clas
Slide 10: Acquisition and disposition history
Acquired 11 Properties for $105M 2018 Acquired 67 Properties for $1,302M(3) 2019 Acquired 3 Properties for $16M 2020 Acquired 4 Properties for $71M 2021 Acquired 7 Properties for $157M 2022 Acquired 2 Properties for $70M 2023 Acquired 7 Properties for $135M YTD 2024 Sold 1 Property for $3M Sold 2 Pr
Slide 11: Broad Acquisition Sourcing Network Affords Opportunity to be Highly Selective
Broad Acquisition Sourcing Network Affords Opportunity to be Highly Selective 86.5% Pass - Do Not Fit Investment Strategy 13.6% Presented to Management 3.2% LOI Sent to Seller 1.5% LOI Accepted 1.2% Closed Medical Outpatient Buildings Inpatient Rehabilitation Facilities Other Healthcare Facilities I
Slide 12: Market, demographic, location and tenant analysis
• Rent growth, supply/demand, absorption, construction, vacancy, etc. • Markets that have recession resistant attributes such as universities and government presence • Major employers in the market Market Analysis • Target markets with population growth at or above national average • Demographic stu
Slide 13: Annual Lease Escalation Structure and Portfolio Growth
Annual Lease Escalation Structure 13.0% 87.0% 16.5% 83.5% CPI Contractual ABR(1) Leases(2) • Experienced management team has a proven record of negotiating and closing on meaningful acquisitions and strategic dispositions • Supportive year-over-year internal growth through 2.2% weighted average annu
Slide 14: Geographic Diversification
We seek to acquire and own healthcare real estate diversified across the country, with a focus on “Smile State” markets with strong demographic, economic, and social drivers. (1) Represents each state’s annualized March 2024 contractual base rent as a percentage of total annualized March 2024 contra
Slide 15: Sponsor Strength and Recognition
Market leading healthcare providers across the country put their trust in our facilities to provide the highest quality healthcare settings. Sponsor Strength and Recognition3 15
Slide 16: Property Type and Tenant Diversification
16 Property Type Diversification(3) (ABR(1), Properties) 37.3%, 90 28.6%, 19 34.1%, 27 Medical Outpatient Building Inpatient Rehabilitation Facility Surgical and Specialty Facilities Tenant/Sponsor Diversification(1)(4) 38.8% 25.5% 35.7% Investment Grade Rated Tenant/Guarantor or Affiliate Rated Ten
Slide 17: Strong Operating Metrics from Long-Term Leases
17 Tenant Lease Expiration Schedule 0.0M 0.5M 1.0M 1.5M 2.0M $0M $20M $40M $60M Square Feet An nu al iz ed B as e R en t ( 1) Annualized Base Rent Expiring Sq Ft (1) Based on annualized March 2024 contractual base rent. (2) Master leases account for a single lease. We believe that long-term leases p
Slide 18: Sila Demonstrates Strong Metrics Relative to Peers
8.4 Yrs 11.8 Yrs 5.8 Yrs SILA Net Lease Peer Average Healthcare Peer Average Long Lease Term 99.2% 99.6% 92.5% SILA Net Lease Peer Average Healthcare Peer Average Portfolio Leased 3.0x 4.9x 5.9x SILA Net Lease Peer Average Healthcare Peer Average Low Leverage (Net Debt / EBITDAre) 99.9% 99.0% 79.1%
Slide 19: Balance Sheet Highlights
Sila’s management team has built a public-markets-worthy balance sheet that we believe is positioned for growth and insulated from adverse and unpredictable market dislocations. Fixed(1) vs. Variable Rate Exposure Debt Maturity Schedule(2) $275 M $250 M 2024 2025 2026 2027 2028 2029 Te rm L oa n U n
Slide 20: 2024 Acquisitions
Sila has an opportunistic ability to continue optimizing our portfolio composition on top of already possessing a curated and sizable assortment of high- quality and diversified healthcare net lease assets as demonstrated by our 2024 acquisitions. Brownsburg Healthcare Facility Brownsburg, IN • $39.
Slide 21: Company history and Putting Shareholders First
Founding of Sila Realty Trust, Inc. 2014 Founding of predecessor company. 2010 Sale of predecessor company’s data center portfolio 2018 Merger with predecessor company, creating size and scale of healthcare portfolio 2019 Internalization of management and rebranding to Sila Realty Trust, Inc. 2020 S
Slide 22: Cycle-tested management team
Cycle-tested management team with proven operating experience and extensive knowledge of the existing portfolio and tenant partners. Michael A. Seton President and Chief Executive Officer • 30+ years of experience in real estate investment and finance, completing billions of dollars in real estate t
Slide 23: Our Board of Directors
Our Board of Directors brings a diverse array of industry insights and business experience and perspectives to the Company. * Denotes Independent Director Jonathan Kuchin, Chairman of the Board* Member of Audit Committee • Formerly Tax Partner at PWC - Focused on public and private REITS, SEC report
Slide 24: Commitment to Corporate Governance
Experienced Board of Directors, Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee Majority independent Board of Directors (83%), who bring a diverse array of backgrounds, experience, and perspectives 10+ years as an SEC registrant (since inception) Boar
Slide 25: Stewardship of environment, community, employees and governance
Sila believes in maintaining a healthy, prosperous, and sustainable work environment through stewardship of the environment, the community, the employees, and strong corporate governance practices. • Sila seeks to own healthcare properties that are important to the communities they serve • Sila prom
Slide 26: Appendix
Appendix Tampa Healthcare Facility II, Florida
Slide 27: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Adjusted Fair Value of Real Estate Investments Adjusted fair value of real estate investments is calculated using the real estate values determined as of the most recent NAV (as defined below), adjusted for property acquisitions and dispositions, major capit
Slide 28: Non-GAAP Measures and Definition of Terms: EBITDARM
Non-GAAP Measures and Definition of Terms Earnings Before Interest, Taxes, Depreciation, Amortization, Rent and Management Fees (EBITDARM) The Company utilizes EBITDARM, a supplemental non-GAAP performance measure, to evaluate the core operations of our tenants and/or guarantors (together, the “Obli
Slide 29: Non-GAAP Measures: FFO, Core FFO and AFFO
Non-GAAP Measures and Definition of Terms Funds from Operations (FFO), Core FFO, and Adjusted FFO (AFFO) FFO, a non-GAAP financial measure, is calculated consistent with NAREIT’s definition, as net income (loss) (calculated in accordance with GAAP), excluding gains (or losses) from sales of real est
Slide 30: FFO, Core FFO and AFFO (Cont'd)
Non-GAAP Measures and Definition of Terms Funds from Operations (FFO), Core FFO, and Adjusted FFO (AFFO) (Cont’d) Three Months Ended March 31, 2024 Net income (loss) attributable to common stockholders 402,660$ (7,978)$ 24,042$ 14,980$ Adjustments: Depreciation and amortization 81,999 77,099 74,202
Slide 31: Liquidity, Net Debt and NAV
Liquidity A financial metric that represents the outstanding cash and cash equivalents combined with the remaining borrowing base availability on the Company’s credit facility at the end of the period. Net Debt Net debt, a non-GAAP financial measure, represents principal debt outstanding less cash a
Slide 32: Net Operating Income (NOI) and Cash NOI
Net Operating Income (NOI) and Cash NOI NOI, a non-GAAP financial measure, is defined as rental revenue, less rental expenses, on an accrual basis. Cash NOI is calculated to exclude the impact of GAAP adjustments to rental revenue and rental expenses, consisting of straight-line rent adjustments, ne
Slide 33: Net Operating Income (NOI) and Cash NOI (Cont'd)
Net Operating Income (NOI) and Cash NOI (Cont’d)(1) Non-GAAP Measures and Definition of Terms Three Months Ended March 31, 2024 Rental revenue 172,838$ 179,986$ 189,065$ 50,639$ Rental expenses (17,712) (17,950) (20,196) (5,554) Net operating income 155,126 162,036 168,869 45,085 Adjustments: Straig
Slide 34: Contact Information
Contact Information Corporate Address www.SilaRealtyTrust.com 1001 Water Street Suite 800 Tampa, FL 33602 Miles Callahan Senior Vice President, Capital Markets & Investor Relations 833.404.4107 IR@silarealtytrust.com