Jernigan Capital — Investor Presentation (June 2019)
32 slides from Jernigan Capital's investor presentation, Jun 3, 2019
Slide 1: Investor Presentation June 2019
JERNIGAN Capital INVESTOR PRESENTATION June 2019
Slide 2: Safe Harbor Disclosure Regarding Forward-Looking Statements
SAFE HARBOR DIS‘ SURE REGARDING FORWARI OOKING STATEMEN’
Slide 3: Introduction
INTRODUCTION OUR MISSION 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 shareholder value by accumulating a multi-billion doll
Slide 4: Recent Events
RECENT EVENTS THE FOLLOWING OCCURRED TO-DATE 2019: 1/28/2018: The Company's joint venture with Heitman purchased 100% of the developers’ interests in the LLCs that own the Atlanta 1, Jacksonville, Atlanta 2, and Denver development property investments for an acquisition price of $12.1 millon. The SL
Slide 5: Management Company Internalization Update
MANAGEMENT COMPANY INTERNALIZATION UPDATE KEY HIGHLIGHTS Management Agreement between JCAP and the Manager sets forth a process for internalization that begins no later than October 3, 2019 = that process has been well described in public filings. If internalization occurs, the internalization price
Slide 6: Investment Highlights
INVESTMENT HIGHLIGHT! Compelling Investment Economics High Quality Platform with Demonstrated Expertise Significant Identified id Potential Growth Opportunities Flexible Capital Structure Supports Strong Future Growth Solely focused on sel storage ~top performing eal estate sector in total sharehold
Slide 7: Experienced and Aligned Senior Management Team
EXPERIENCED AND ALIGNED SENIOR MANAGEMENT TEAM ~7% MANAGEMENT AND BOARD OWNERSHIP CREATES SIGNIFICANT ALIGNMENT OF INTERESTS " : 1 1 ! Dean Jernigan Joined lencan any — David corak = cn ramet ae =e —, oe bgt. aie mee cn ‘ter Ser cous coors ae oe ee « eeeen » : oe re, a itener aims eased - nee spemie
Slide 8: JCAP's Competitive Advantage
“AP'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 * Developer freed of burden to raise
Slide 9: High ROI Business Model Executed in Top Self-Storage Markets
HIGH ROI BUSINESS MODEL EXECUTED IN TOP SELF-STORAGE MARKETS ATTRACTIVE RISK-ADJUSTED RETURNS THROUGH EQUITY PARTICIPATION DEVELOPMENT INVESTMENTS Ground-up Construction | Major Redevelopment PRIMARY INVESTMENT STRATEGY + Focus on programmatic self storage development of Generation V faites in top-t
Slide 10: Development Project Investment Timeline
DEVELOPMENT 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 90-97% of total cost with fixed interest rate of 6.9% + 49.9% pr
Slide 11: Predictable Dividend That Tracks Value Creation
PREDICTABLE DIVIDEND THAT TRACKS VALUE CREATION HISTORICAL DILUTED ADJUSTED EPS AND COMMON DIVIDENDS‘) 25K Ce i a i718 age 3 Qe 199 41
Slide 12: Selective Underwriting
SELECTIVE UNDERWRITING $11.1 billion INVESTMENTS REVIEWED. $1.4 billion ‘TERM SHEETS ISSUED af
Slide 13: Portfolio Located in Attractive Markets
S LOCATED IN ATTRA‘ PORTFOLIO HIGHLIGHTS Investments in a portfolio of newly built, multi-story, climate controlled, Class-A self-storage facilities primarily located within the best, submarkets of the top 50 MSAs + 9796 of facilities located within the top 50 MSAs; 84%6 located within the top 25 MS
Slide 14: Attractive Investment Portfolio
14 ATTRACTIVE INVESTMENT PORTFOLIO. $915 MILLION COMMITTED" / 74 INVESTMENTS Eight wholly-owned self-storage facilities, 49 on-balance sheet development investments 11 assets in Heitman Joint Venture (all in lease-up) + Four wholly-owned by the venture® Five bridge investments (all in lease-up) (One
Slide 15: Current Portfolio and Investment Pipeline
JRRENT PORTFOLIO AND INVESTMENT PIPELINE Heseare Minneapolis * Mion Boston mperiion Haven Stamford Pittsburgh: ‘New York City-Northern Nj 2 Phiadelpria Denver ir * Baktimore Kansas cay ia Wishington De Fe fateicn Los Angeles f i Koosle He chante heats SOD DawonieeeRi Ta Austin jew Organs pe Jacksonv
Slide 16: Business Model Proven from Origination to Acquisition
BUSINESS MODEL PROVEN FROM ORIGINATION TO ACQUISITION PROPERTY HIGHLIGHTS Multistory, climate controlled facility totaling 59,848 NRSF * Investment originated in September 2015; C/O achieved August 2016; JCAP ‘acquired developer interest January 2018 + Located on East West Parkway, just west of High
Slide 17: Wholly-Owned Properties
WHOLLY-OWNED PROPERTIES SUMMARY & HIGHLIGHTS. * Development loans on the eight properties converted to equity ~75% to 8.5% average stabilized yield on JCAP Capital Investment) Recent acquisitions demonstrate JCAP’s ability to execute long-term strategy to ‘own developed assets at compelling yields W
Slide 18: Miami Bridge Investment
MIAMI BRIDGE INVESTMENT INVESTMENT SUMMARY & HIGHLIGHTS * Bridge financing provided to take out existing construction debt and certain equity capital partners on a portfolio consisting of five newly built, Generation V facilites + IRR consistent with development investments with discount for lack of
Slide 19: JCAP Capital Sources and Investment Uses
JCAP CAPITAL SOURCES AND INVESTMENT USES SUNIMIARVetniGiMIGETS ‘SOURCES AND USES FOR INVESTMENT AS OF 3/31/2019 (S IN MILLIONS)" + $286 million total estimated cash investment remaining on existing ‘and projected 2019 commitments, Conrail vestmen cDi gan + Funding in place forall remaining cash inve
Slide 20: Contact Jernigan Capital
CONTACT JERNIGAN CAPITAL 20
Slide 21: Appendix
Capital APPENDIX
Slide 22: Portfolio Detail
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Slide 23: Portfolio Detail - Continued
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Slide 24: Portfolio Detail - Continued
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Slide 25: Portfolio Detail - Continued
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Slide 26: Portfolio Detail - Continued
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Slide 27: JCAP Is an Equity REIT, Not a Mortgage REIT
P IS AN EQUITY REIT, NOT A MORTGAGE REIT TYPICAL MORTGAGE REIT Higher corporate leverage, including leverage of junior debt No equity participation specific niche proper Structured finance arbitrage rather than jerier property focus Communication with borrowers only when problems or reporting of cov
Slide 28: Heitman Capital Management Joint Venture Overview
EITMAN CAPITAL MANAGEMENT JOINT VENTURE OVERVIEW 133 milion (including capital investment Inthe four properties wholyowned by the venture) A. Acsuon Fe 1 on re equity Investments above $4.9 milion nal contributon 8. Administrative Fee (Capped) C. Promote: \P Fee Overview (909% / 10% split through 14
Slide 29: Highland Capital Series A Preferred Overview
HIGHLAND CAPITAL SERIES A PREFERRED OVERVIEW pS tence yeaa Up to $125 million of equity capital through September 2018 79% cash dividend and Payment in Kind (Pl {at investor's election) up to 25% of incremental increase in book value; total return limited to 14% IRR. Cost of Capit In January 2018, e
Slide 30: Series B Preferred Stock Overview
SERIES B PREFERRED STOCK OVERVIEW NYSE Symbol JcapP, Series B Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share with a liquidation Structure of the Investment Fedleedeni at teem 17% cash dividend a Fund existing or future investments in the Company's development portfolio an
Slide 31: Credit Facility Overview
CREDIT FACILITY OVERVIEW Up to $235 million debt capital, expandable up to $400 milion with accordion feature, upon satisfaction of certain conditions. As of March 31, 2019, the Company had $118 milion of total availability (before considering any ‘amounts outstanding), and, based on expected C/Os,
Slide 32: Term Loans Overview
TERM LOANS OVERVIEW Secured by frst mortgages on four of CAP’ wholly-owned set storage facies Three years ~ August 2021 maturty date ‘Match funding, no dilution, lower-cost capital 32