Broadstone Net Lease, Inc. · NYSE:BNL
Broadstone Net Lease — Q1 2023 Earnings Presentation
23 slides from Broadstone Net Lease's earnings presentation, May 2023
Slide 1: Investor Presentation May 2023
INVESTOR PRESENTATION MAY 2023
Slide 2: Disclaimer
DISCLAIMER CAUTIONARY STATEMENTS CONCERNING FORWARD-LOOKING STATEMENTS 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, regarding, among other thing
Slide 3: Broadstone At-A-Glance
BROADSTONE AT-A-GLANCE $389 Million 39.1 Million Annualized Base Rent Rentable Square Footage 52% Industrial 17% Healthcare 13% Restaurant 12% Retail 99.4% Occupancy 1 6% Office 100.0% 10.8 Years WALT Rent Collections in Q1 2.0% Annual Escalation 94.3% Financial Reporting2 801 Properties $20.0 Milli
Slide 4: Investment Thesis
INVESTMENT THESIS Established REIT with Longstanding Track Record of Success ▪ 15-year operating history pursuing a diversified net lease strategy with a leading team, now proven through two cycles ▪ Publicly traded on the NYSE (BNL) with experience operating under substantially all public company r
Slide 5: Employee Tenure and Track Record of Growth
BROADSTONE NET LEASE (NYSE: BNL) Longstanding operating history and track record of success delivering results to shareholders ($mm)1 AVERAGE EMPLOYEE TENURE: 4.8 YEARS $5,652 5+ 49% Employee Tenure $5,427 4 12% (Years) 3 11% $4,572 2 4% <2 24% $4,043 $4,037 AVERAGE SENIOR EMPLOYEE TENURE: 6.5 YEARS
Slide 6: Q1 2023 At-A-Glance
Q1 2023 AT-A-GLANCE Our Diversified Portfolio Continues to Generate Consistent Results and Steady Same-Store Growth PORTFOLIO OVERVIEW KEY OPERATING METRICS $389 Million 801 39.1 Million 99.4% 100% Annualized Base Rent Properties Square Footage Occupancy Rent Collection $5.3 billion 44 + 4 $20.0mm $
Slide 7: Highly Diversified by Tenant & Property Type
HIGHLY DIVERSIFIED BY TENANT & PROPERTY TYPE TOP 20 TENANTS PROPERTY TYPE DIVERSIFICATION (BY ABR) ABR as a # of Tenant Property Type % of Total Properties Portfolio Industrial 52% Roskam Baking Company* Industrial 7 4.0% Manufacturing 17% AHF Products* Industrial 8 2.4% Distribution & Warehouse 13%
Slide 8: Portfolio Property Types: Industrial and Healthcare
PORTFOLIO PROPERTY TYPES TOP INDUSTRIAL TENANTS KEY STATISTICS PROPERTY TYPE BREAKDOWN ABR % | $: 52% | $202mm Industrial Services Cold Storage 5% 6% Manufacturing Properties: 193 32% Flex and R&D Square Feet: 30.1mm 9% 52% WALT: 11.9 years ABR Food Processing 22% Wtd Avg. Annual Rent 2.0% Escalatio
Slide 9: Portfolio Property Types: Restaurant, Retail, Office
PORTFOLIO PROPERTY TYPES TOP TENANTS KEY STATISTICS PROPERTY TYPE BREAKDOWN ABR % | $: 13% | $52mm RESTAURANT Properties: 247 QSR Square Feet: 1.2mm Casual 13% 48% Dining WALT: 14.3 years ABR 52% Wtd Avg. Annual 1.8% Rent Escalation: Automotive ABR % | $: 12% | $45mm 28% Properties: 215 Home RETAIL
Slide 10: Significant Geographic Diversity
SIGNIFICANT GEOGRAPHIC DIVERSITY TOTAL PROPERTIES: 801 TOTAL STATES/PROVINCES: 44 + 4 Canadian provinces ABR as a % of State Total Portfolio 1 TX 9.8% 2 MI 8.4% 3 IL 6.2% 4 WI 5.6% 5 CA 4.8% 6 OH 4.8% 7 FL 4.2% 8 IN 4.1% 9 MN 4.0% 10 TN 3.9% Top 10 States 55.8% As of March 31, 2023, rent percentage
Slide 11: Significant Cross-Diversification
SIGNIFICANT CROSS-DIVERSIFICATION Significant Geographic, Property Type, and Industry Diversification Helps to Mitigate State Specific Risk STATE EXPOSURE AT-A-GLANCE ($ in millions) State: Texas Dallas Concentration: 1 $5.8 Houston $1.0 ABR: % | $ 9.8% | $38.0mm Austin $1.0 $13.1 Tenants: 38 Sherma
Slide 12: Top-Tier Portfolio Metrics
TOP-TIER PORTFOLIO METRICS RENT COLLECTION RENT ESCALATION 100.0% 100.0% 100.0% 99.9% 100.0% 2.5% Contractual Fixed Increases 2.3% 85.6% 2.0% 1.8% 1.6% CPI- Related 11.7% Flat 2.7% Industrial Retail Office Healthcare Restaurant Q1 Q2 Q3 Q4 Q1 80.3% Leases with 2022 2023 Annual Increases LONG WALT WI
Slide 13: Differentiated Investment Approach
DIFFERENTIATED INVESTMENT APPROACH Agile Investment Strategy Enables Identification of Attractive Investment Opportunities Diversified Core Attractive Capital Proven Property Sectors Allocation Investment Strategy ▪ A decade plus of experience ▪ Flexibility to identify adjacent property ✔ Increased
Slide 14: Systematic Investment Approach
SYSTEMATIC INVESTMENT APPROACH INVESTMENT TEAMS: INDUSTRIAL HEALTHCARE RESTAURANT / RETAIL CURRENT BROKERAGE DEVELOPMENT TENANT PRIVATE SOURCING CHANNELS: UPREIT OWNERS NETWORK PARTNERS RELATIONSHIPS EQUITY INVESTMENT TYPE DESCRIPTION SALE ◼ Acquire single-tenant property with a simultaneous new lon
Slide 15: Proven Investment Approach
PROVEN INVESTMENT APPROACH Long-Standing Diversified Strategy Provides Acquisition Flexibility from Year to Year Without Dramatically Influencing Overall Portfolio Concentration Volume ($mm) $1,032 Industrial $907 Healthcare $684 Restaurant $655 $607 $550 $859 $206 $645 Guidance $519 Retail $500 Ran
Slide 16: Conservative Balance Sheet Management & Prudent Capital Allocation
Conservative Balance Sheet Management & Prudent Capital Allocation 1 Defensive leverage profile with broad access to diversified capital sources 2 Carefully constructed platform built to deliver accretive external growth 3 Specialized, national sourcing model with robust pipeline of opportunities 4
Slide 17: Well Capitalized Balance Sheet
WELL CAPITALIZED BALANCE SHEET Investment Grade Credit Rated Balance Sheet with Well Laddered Maturities and Strong Liquidity TOTAL CAPITALIZATION DETAIL TOTAL CAPITALIZATION ON MARCH 31, 2023 ($ in thousands) March 31, 2023 1.6% 2.0% Equity Common Stock Common Stock 187,203 16.1% OP Units OP Units
Slide 18: Emphasis Placed on Liquidity
EMPHASIS PLACED ON LIQUIDITY Conservative Leverage Profile & Ample Liquidity to Navigate Current and Future Economic Uncertainly KEY CREDIT METRICS AS OF MARCH 31, 2023 LEVERAGE PROFILE EVOLUTION2 Forward Equity Proceeds Outstanding Pro Forma Net Debt / Annualized Adj. EBITDAre 5.1x 3.9x BBB / Baa2
Slide 19: Corporate Responsibility
CORPORATE RESPONSIBILITY Commitment to Corporate Responsibility We are committed to being a responsible corporate citizen by conducting our operations in a sustainable and ethical manner. We strive to foster a culture that is inclusive, collaborative, and based on trust, and invest heavily in the he
Slide 20: Board of Directors & Governance
BOARD OF DIRECTORS & GOVERNANCE BOARD OF DIRECTORS (INDEPENDENT) KEY GOVERNANCE HIGHLIGHTS Name, tenure Experience Laurie Hawkes (Chairman) ◼ Co-Founder, American Residential Properties ✓Majority independent board Director since 2016 ◼ Director, Appreciate Holdings, Inc. (NASDAQ: Chairman since 2021
Slide 21: Additional Information
BROADSTONE a NET LEASE, INC. ADDITIONAL INFORMATION
Slide 22: GAAP Reconciliations: FFO, Core FFO and AFFO
GAAP RECONCILIATIONS FUNDS FROM OPERATIONS (FFO), CORE FFO, AND ADJUSTED FUNDS FROM OPERATIONS (AFFO) Three Months Ended March 31, December 31, (in thousands) 2023 2022 Net income $ 41,374 $ 36,773 Real property depreciation and amortization 41,745 45,570 Gain on sale of real estate (3,415) (10,625)
Slide 23: GAAP Reconciliations: EBITDA and Net Debt
GAAP RECONCILIATIONS EBITDA, EBITDAre, Adjusted EBITDAre, Net Debt to Annualized Adjusted EBITDAre As of (in thousands) March 31, 2023 December 31, 2022 September 30, 2022 June 30, 2022 March 31, 2022 Debt Unsecured revolving credit facility $ 108,330 $ 197,322 $ 219,537 $ 320,657 $ 266,118 Unsecure