Netstreit Corp. · NYSE:NTST
Netstreit — Investor Presentation (July 2021)
26 slides from Netstreit's investor presentation, Jul 29, 2021
Slide 1: Investor Presentation July 2021
Investor Presentation July 2021
Slide 2: Disclaimer
Disclaimer 2 This presentation contains 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. Such forward-looking statements include, without limitation, statements concerning our b
Slide 3: Company & Investment Highlights
Company & Investment Highlights 3 NETSTREIT Is Built on a Foundation of Strength on Both Sides of the Balance Sheet, Led by a Seasoned Leadership Team with an Exceptional Track Record High-Quality, Diversified, and Defensive Net Lease Retail Portfolio Conservative Capitalization to Support Accretive
Slide 4: NETSTREIT Strategy by the Numbers
NETSTREIT STRATEGY BY THE NUMBERS1 4 Investment grade tenancy provides defensive, consistent performance through economic cycles ▪ High-quality tenancy creates bond-like leases with high rent collections during times of disruption ▪ 83.4% of portfolio consisted of investment grade tenants, or tenant
Slide 5: NTST's Stable, Defensive Cash Flow Profile Drives Superior Risk-Adjusted Returns
99% 98% 97% 93% 90% 90% 90% 87% FCPT NTST ADC O NNN EPRT SRC STOR 100% 100% 99% 97% 96% 96% 94% 93% NTST FCPT ADC NNN SRC EPRT O STOR 65% 70% 67% 67% 50% 23% 19% 0% 0% NTST ADC FCPT O SRC NNN STOR EPRT 5 Rent Collections Source: Company Filings as of 6/30/2021, SNL Financial. 1. NNN as of 12/31/2020
Slide 6: Portfolio Overview
9.3% 6.5% 6.4% 6.3% 5.9% 5.0% 4.6% 4.6% 3.7% 3.5% Portfolio Overview 6 Sources: Company data. Portfolio data represents portfolio as of 6/30/2021. 1. Represents tenants with investment grade credit metrics (more than $1.0 billion in annual sales and a debt to adjusted EBITDA ratio of less than 2.0x)
Slide 7: Portfolio Diversification In Defensive Retail Sectors
Convenience Stores: Dollar Stores: Discount Retail: Home Improvement: Auto Parts: Portfolio Diversification In Defensive Retail Sectors Source: Company data. Portfolio data represents portfolio as of 6/30/2021. Note: Due to rounding, respective defensive retail sector exposure may not precisely refl
Slide 8: NTST Portfolio Transformation
Pre-144A (12/23/19) 144A to IPO IPO (8/13/20) Since IPO Current (6/30/21) Properties 93 70 163 104 267 States 28 6 34 5 39 Portfolio Size 1.4M SF 1.6M SF 3.0M SF 2.2M SF 5.2M SF ABR $17.8M $16.7M $34.5M $20.8M $55.3M Acquisition Volume1 – ~$264M – ~$352M – Acquisition Cap Rate1 – 6.6% – 6.6% – Dispo
Slide 9: Investment Activity Since 2019
$74.2 $150.5 $102.6 $81.2 $89.5 $120.7 1Q'20 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 Completed Acquisitions New Quarterly Acquisitions 193 Completed Acquisitions Investment Activity Since 2019 9 Source: Company data. 1. Includes one development project funded in the first quarter. 2. Includes two development
Slide 10: Active Asset Management
Active Asset Management 10 NETSTREIT continuously tracks property performance and stratifies the portfolio to achieve consistent cash flows and balanced growth for its investors Source: Company data. Portfolio data represents portfolio as of 6/30/2021. Since inception, the Company has disposed of 53
Slide 11: Three-Part Underwriting Philosophy
Three-Part Underwriting Philosophy 11 NETSTREIT leverages a disciplined, three-pronged approach to underwriting potential acquisitions which positions the Company to benefit from superior downside protection on its investments REAL ESTATE VALUATION UNIT-LEVEL PROFITABILITY • Review underlying key re
Slide 12: Tenant Credit Underwriting
Tenant Credit Underwriting 12 NETSTREIT employs a credit-focused underwriting strategy for all tenants – the MOST IMPORTANT element of the Company’s underwriting process that drives stable revenue and long-term return on investment Source: Company data. Portfolio data represents portfolio as of 6/30
Slide 13: Focus on Investment Grade Tenants
Focus on Investment Grade Tenants 13 Investment grade tenants have outperformed during economic downturns and largely avoided bankruptcy Sources: Capital IQ, Company data, The Deal Pipeline, Bloomberg, SNL Financial 1. Indicates best credit rating held after 1/1/2005 and date when the respective cre
Slide 14: Real Estate Valuation
Real Estate Valuation 14 Real Estate closely follows Credit as a top priority: NETSTREIT utilizes a ground-up framework rooted in real estate fundamentals to underpin its valuation and further quantify the upside potential for a transaction Market-Level Considerations Property-Level Considerations •
Slide 15: Unit-Level Profitability
Unit-Level Profitability 15 In assessing unit-level financial performance, NETSTREIT focuses on mission-critical properties with strong rent coverage and higher variability in operating costs Obtain Financial Information Perform Financial Analysis 2 Assess Investment Merits 1 3 • Provides clarity in
Slide 16: Portfolio Strategy / Investment Philosophy
Portfolio Strategy / Investment Philosophy 16 Source: Company data. Portfolio data represents portfolio as of 6/30/2021. 1. Portfolio statistics by percentage of ABR. Current MetricsInvestment Philosophy Portfolio Strategy Defensive Tenancy in Necessity-Based and E-commerce-Resistant Retail Sectors1
Slide 17: Growth Strategy: Generating Both Quality & Quantity
Growth Strategy: Generating Both Quality & Quantity 17 The Company utilizes a multi-faceted growth strategy to deploy capital in a variety of investment structures in the Net Lease Retail sector, allowing it greater flexibility to build its portfolio from a larger opportunity set Investment Type Des
Slide 18: Acquisition Case Study: Investment Grade (rated) Target – Kingston, MA
Acquisition Case Study: Investment Grade (rated) 18 Target – Kingston, MA Sources: S&P Global Market Intelligence, Company data. Market data as of 7/21/2021. 1. Represents the twelve months ended 1/30/2021. 2. Reflects long-term debt as of 1/30/2021. Strong-Performing Location with High Likelihood o
Slide 19: Acquisition/Disposition Case Study: Investment Grade (rated) 7-Eleven – Texas
Acquisition/Disposition Case Study: Investment Grade (rated) 19 7-Eleven – Texas Sources: Company data. Portfolio Execution with Subsequent Accretive Dispositions to Reduce Exposure • Example of platform’s ability to acquire large, high quality portfolios, and selectively exit assets in the acquired
Slide 20: Senior Leadership
Senior Leadership 20 Source: Company data. 1. First Potomac Realty Trust was publicly traded on the NYSE until October 2017. Seasoned leadership team with significant net lease retail and public company experience Mark Manheimer President, CEO & Director Mr. Manheimer leads the overall strategy, acq
Slide 21: Key Personnel
Key Personnel 21 Source: Company data. 1. First Potomac Realty Trust was publicly traded on the NYSE until October 2017. Experienced team of professionals drive NETSTREIT’s day to day operations Jeff Fuge Senior Vice President, Acquisitions • Joined in December 2019 • Prior experience includes: – Di
Slide 22: Corporate Responsibility
Corporate Responsibility 22 ▪ Dedication to reducing the Company’s ecological footprint ▪ Endorsement of renewable resources and encouragement of tenants to practice leading sustainability initiatives ▪ Implementation of energy conservation practices in the office E Environmental Responsibility ▪ Em
Slide 23: Board of Directors
Board of Directors Lead Independent Director ▪ Compensation Committee Chair ▪ Investment Committee Chair ▪ Audit Committee Member Background ▪ Formerly AEW Capital Management, Head of AEW Real Estate Securities ▪ Formerly Landmark Land Company, VP Matt Troxell, CFA Independent Director ▪ Audit Commi
Slide 24: Company & Investment Highlights
Company & Investment Highlights 24 NETSTREIT Is A Growth Company With A Defensive Net Lease Retail Strategy High-Quality, Diversified, and Defensive Net Lease Retail Portfolio Conservative Capitalization to Support Accretive Growth Active Asset Management to Achieve Optimal Portfolio Performance Dis
Slide 25: Definitions
Definitions 25 ABR means annualized base rent. ABR is calculated by multiplying (i) cash rental payments (a) for the month ended June 30, 2021 (or, if applicable, the next full month's cash rent contractually due in the case of rent abatements, rent deferrals, recently acquired properties and proper
Slide 26: Investor Relations
26 Investor Relations ir@netstreit.com 972-597-4825