Sila Realty Trust, Inc. · NYSE:SILA
Sila Realty Trust — Q2 2024 Earnings Presentation
34 slides from Sila Realty Trust's earnings presentation, Aug 7, 2024
Slide 1: Nareit REITweek Company Presentation
Nareit REITweek Company Presentation June 2024 Skillful and Thoughtful Investing
Slide 2: Disclosures
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 REIT specializing in healthcare properties
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 Kay C. Neely President and Chief Executive Officer Executive Vice President Founder and Board Member and Chief Financial Officer Christopher K. Flouhouse Miles F. Callahan Executive Vice President Senior Vice President and Chief Investment Officer Capital Markets and I
Slide 5: Sila Realty Trust At a Glance
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 the U.S. economy. What differentiates us? Portfolio Highlights • The only “pure-play” healthcare net lease REIT focused solely
Slide 6: Key Investment Themes
Key Investment Themes We believe that Sila’s high-quality portfolio, attractive growth characteristics, disciplined capital structure, and strong governance have positioned the Company well for a public market listing. Pure-Play in High-Quality 1 Healthcare Assets 4 Fortified Balance Sheet to Fund F
Slide 7: Pure-Play Net Lease REIT Focused on High-Quality Healthcare Assets
1 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 Lowest Acuity (Highest Cost Settings) (Lo
Slide 8: Large Growing Market in a Defensible Sector
1 Large Growing Market in a Defensible Sector Capitalizing on favorable macro tailwinds driving demand for healthcare settings that are cost efficient while delivering personalized, quality of care. Share of Population Share of Spending People age 65+, on average, spend more on healthcare By 2030, a
Slide 9: Asset Strategy and Platform Positioned for Growth
2 Asset Strategy and Platform Positioned for Growth Our in-depth, well-disciplined underwriting strategy, executed by a seasoned in-house team, allows the Company to source accretive opportunities that are critical to the business operations of our tenants and the communities they serve. High Qualit
Slide 10: Proven Acquisition Track Record
2 Proven Acquisition Track Record With a multifaceted investment strategy, our seasoned leadership team utilizes our deep industry relationships while being supported by our disciplined underwriting team with a dual focus on both real estate and tenant credit. YTD 2024 $2.2 B $16.4 M 136 Acquired 7
Slide 11: Broad Acquisition Sourcing Network Affords Opportunity to be Highly Selective
2 Broad Acquisition Sourcing Network Affords Opportunity to be Highly Selective Sila’s Acquisitions and Credit Underwriting teams have evaluated over 2,500 healthcare investment opportunities since 2019. Sourcing and Underwriting Investment Opportunities(1) • Relationships and reputation with tenant
Slide 12: Acquisition and Underwriting Framework
2 Acquisition and Underwriting Framework Sila’s overall portfolio quality demonstrates the Company’s sourcing, asset selection, underwriting, and deal execution capabilities. Demographics Financial Review of Tenant Real Estate/Lease Fundamental Review • Target markets with population growth at or •
Slide 13: Disciplined Capital Allocation
2 Disciplined Capital Allocation With a multifaceted investment strategy, our seasoned leadership team utilizes our deep industry relationships while being supported by our diligent underwriting team with a dual focus on both real estate and tenant credit. Portfolio Growth FFO Payout Ratio(3) 84.9%
Slide 14: Geographic Diversification
3 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. Top 5 States by ABR(1) Texas 28.3% Oklahoma 7.3% Louisiana 5.8% Arizona 5.6% Ohio 4.9% “Smile St
Slide 15: Sponsor Strength and Recognition
3 Sponsor Strength and Recognition Market leading healthcare providers across the country put their trust in our facilities to provide the highest quality healthcare settings. 15
Slide 16: Diversified and Secure Tenancy
3 Diversified and Secure Tenancy Sila’s 136 healthcare properties are well-diversified through tenancy and across the continuum of care, reducing over exposure to any single healthcare subtype. Property Type Diversification(3) Tenant/Sponsor Diversification(1)(4) (ABR(1), Properties) Post Acute Medi
Slide 17: Strong Operating Metrics from Long-Term Leases
3 Strong Operating Metrics from Long-Term Leases We believe that long-term leases provide stability with a future ability to capitalize on opportunities. Portfolio Leased 8.4 Yrs 99.2% 5.3 M 99.5% 99.5% 99.4% 99.2% Weighted Avg. Weighted Avg. Rentable Remaining Lease Term Leased Rate Square Feet 17%
Slide 18: Sila Demonstrates Strong Metrics Relative to Peers
3 Sila Demonstrates Strong Metrics Relative to Peers Sila’s key fundamental metrics closely resemble net lease REIT peers and rank among the top healthcare peers. Long Lease Term Portfolio Leased 11.8 Yrs 99.6% 99.2% 8.4 Yrs 92.5% 5.8 Yrs SILA Net Lease Healthcare SILA Net Lease Healthcare Peer Ave
Slide 19: Fortified Balance Sheet
4 Fortified Balance Sheet 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. Balance Sheet Highlights Fixed(1) vs. Variable Unsecured vs. Rate Exposure Secured Debt $590 M 2
Slide 20: Select Properties Demonstrating Investment Strategy
4 Select Properties Demonstrating Investment Strategy 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
Slide 21: Management with a History of Executing on Shareholder Friendly Initiatives
5 Management with a History of Executing on Shareholder Friendly Initiatives We believe past behavior is the best predictor of future behavior. 2010 Putting Shareholders First Founding of predecessor company. 2014 2018 $556.2M special cash distribution ($3.00/share) paid to predecessor company share
Slide 22: Experienced Management Team
5 Experienced 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 billio
Slide 23: Robust Corporate Governance Led by Experienced Board of Directors
5 Robust Corporate Governance Led by Experienced Board of Directors Our Board of Directors brings a diverse array of industry insights and business experience and perspectives to the Company. Jonathan Kuchin, Chairman of the Board* Member of Audit Committee • Formerly Tax Partner at PWC - Focused on
Slide 24: Commitment to Corporate Governance
5 Commitment to Corporate Governance Board Composition 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
Slide 25: Responsibility and Philanthropy
6 Responsibility and Philanthropy 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. Governance Social Environmental • Diversity in board makeup: 5 indep
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
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 and Definition of Terms
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: Non-GAAP Measures and Definition of Terms (Cont'd)
Non-GAAP Measures and Definition of Terms Funds from Operations (FFO), Core FFO, and Adjusted FFO (AFFO) (Cont’d) Three Months Year Ended(1) Ended March 31, 2021 2022 2023 2024 Net income (loss) attributable to common stockholders $ 402,660 $ (7,978) $ 24,042 $ 14,980 Adjustments: Depreciation and a
Slide 31: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms 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 Asset Value (NAV) NAV is determined by the board of
Slide 32: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms 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, consis
Slide 33: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Net Operating Income (NOI) and Cash NOI (Cont’d)(1) Three Months Year Ended Ended March 31, 2021 2022 2023 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,
Slide 34: Contact Information
Contact Information Corporate Address Miles Callahan 1001 Water Street Senior Vice President, Suite 800 Capital Markets & Investor Relations Tampa, FL 33602 833.404.4107 IR@silarealtytrust.com www.SilaRealtyTrust.com