Agree Realty Corporation · NYSE:ADC
Agree Realty — Investor Presentation (January 2019)
24 slides from Agree Realty's investor presentation, Jan 18, 2019
Slide 1: DEVELOP | ACQUIRE | PARTNER
DEVELOP | ACQUIRE | PARTNER January 2019
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-Looking Statements This presentation may contain certain “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Reform Act of 1995. Forward-looking statements are generally identifiable by use of forward-looking terminolo
Slide 3: Agree Realty Corporation (NYSE: ADC)
Agree Realty Corporation (NYSE: ADC) Retail net lease REIT focused on growth through the acquisition and development of high-quality retail properties Our Company ▪ (1) $3.0 billion retail net lease REIT headquartered in Bloomfield Hills, MI and listed on the NYSE under ticker ADC ▪ (1) 645 retail p
Slide 4: 2018 Highlights
2018 Highlights Consistent execution has led to enhanced shareholder value ▪ 225 retail net lease properties acquired in 2018 for a record $607.0 million ▪ 98-property sale-leaseback transaction with Sherwin-Williams closed for $142.2 million ▪ 16 development and PCS projects completed or under cons
Slide 5: Investment Strategy
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Slide 6: Scaling Three-Pronged Investment Strategy
Scaling Three-Pronged Investment Strategy Leverage real estate acumen and three investment platforms to identify best risk-adjusted retail net lease opportunities ADC’s synergistic investment platforms adhere to the same core principles while pursuing opportunities along the full spectrum of net lea
Slide 7: ADC’s Unique Dual Capabilities
ADC’s Unique Dual Capabilities Emphasis on comprehensive real estate solutions drive multi-faceted partnerships DEVELOPMENT SALE-LEASEBACK ✓ Spearheading retailer ✓ Track record of execution expansion programs for over as acquirer and real estate four decades partner • In-house expertise • Ability t
Slide 8: Track Record of Execution
Track Record of Execution Record 2018 investment activity of approximately $680 million Investment Activity $ in millions $700.0 $74.4 $600.0 $607.0 $500.0 $400.0 $62.7 $38.0 $336.8 $300.0 $295.8 $14.9 $200.0 $220.1 $17.7 $147.5 $100.0 $28.4 $73.3 $0.0 2013 2014 2015 2016 2017 2018 Acquisitions Deve
Slide 9: Accelerating Growth
Accelerating Growth Established real estate capabilities and growing market presence driving increased investment opportunities # of Properties Annualized Base Rent (“ABR”) $ in millions 297 645 $141.7 600 $130.0 $119.2 500 $110.0 436 400 $90.0 $94.3 366 300 $70.0 $72.4 279 $56.5 200 209 $50.0 $45.1
Slide 10: Active Portfolio Management
Active Portfolio Management Our focus on real estate fundamentals guides non-core asset sales and capital recycling Total Dispositions 2010-2018: $229 million(1) $67.6M(1) Mauston, WI $45.8M Upland, CA Atlantic Beach, FL Apopka, FL Minnesota (3) $12.9M $29.0M $29.7M LA (1) & PA (1) Chippewa Commons
Slide 11: Portfolio Summary
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Slide 12: Sherwin-Williams Sale-Leaseback Transaction
Sherwin-Williams Sale-Leaseback Transaction Deal Overview $142.2 million purchase price 98-property portfolio Long-term NNN leases Closed December 28, 2018 Tenant Overview Global leader in the manufacturing, development & distribution of paint & coatings Investment-grade credit ratings of BBB (S&P),
Slide 13: Portfolio Breakdown
Portfolio Breakdown Top Tenants Walmart Lease Type (% ABR) $ in millions # of % of Rank Tenant / Concept Assets ABR(1) Total 1 24 $8.8 6.2% Net Lease 2 5 $5.6 3.9% Ground 60% 3 6 $5.1 3.6% Lease 4 12 $4.5 3.2% 40% 5 20 $4.3 3.1% 6 5 $4.2 3.0% 7 11 $3.4 2.4% ▪ Diversified portfolio comprised of Walma
Slide 14: High-Quality Retail Real Estate = Stronger Residual Values
High-Quality Retail Real Estate = Stronger Residual Values Manassas, VA ▪ $22 million transaction ▪ Credit Rating: S&P: AA / Moody’s: Aa2 ▪ Washington, DC MSA ▪ Strong demographics: ▪ 5-mile population of 174K ▪ 5-mile HH income of $100K ▪ Ground lease structure with reversionary interest in real es
Slide 15: Portfolio Breakdown
Portfolio Breakdown Top Tenants Wawa Lease Type (% ABR) $ in millions # of % of Rank Tenant / Concept Assets ABR(1) Total 1 24 $8.8 6.2% 2 5 $5.6 3.9% Ground Master 3 6 $5.1 3.6% Lease Net Lease 4 12 $4.5 3.2% 58% 42% 5 20 $4.3 3.1% 6 5 $4.2 3.0% 7 11 $3.4 2.4% 12 9 $2.7 1.9% ▪ Geographically divers
Slide 16: Portfolio Breakdown
Portfolio Breakdown Top Tenants $ in millions # of % of Rank Tenant / Concept Assets ABR(1) Total 1 24 $8.8 6.2% 2 5 $5.6 3.9% 3 6 $5.1 3.6% 4 12 $4.5 3.2% 5 20 $4.3 3.1% 6 5 $4.2 3.0% 7 11 $3.4 2.4% ▪ Diversified portfolio comprised of six TJ Maxx, five HomeGoods and one Nashua, NH Marshalls/HomeGo
Slide 17: National and Super-Regional Retailers
National and Super-Regional Retailers Industry leading brands and retailers operating in e-commerce resistant sectors Retail Tenant Type (% ABR) National National 78% Super-Regional Super-Regional 16% Franchise Franchise 6% z As of September 30, 2018. 16
Slide 18: Leading, Pure-Play Retail Net Lease REIT
Leading, Pure-Play Retail Net Lease REIT Diversified portfolio of high-quality retail properties occupied by superior credit tenants under long-term leases Retail % of Total Portfolio Investment Grade Retail Tenants 100.0% 100% 100% 50.0% 51% 87% 75.0% 81% 46% 40.0% 43% 64% 63% 50.0% 30.0% 25.0% 20.
Slide 19: Embedded Redevelopment Opportunities
Embedded Redevelopment Opportunities Mount Pleasant, Michigan Frankfort, Kentucky ▪ Legacy shopping center located on main retail corridor ▪ Legacy shopping center located in Frankfort’s across from Central Michigan University’s campus dominant retail trade area ▪ Kmart Cash ABR: $175K gross ▪ Kmart
Slide 20: 2018 Development and PCS Projects
2018 Development and PCS Projects 16 projects completed or under construction totaling $74.4 million(1) Under Construction Hobby Lobby Mister Car Wash Mister Car Wash Sunbelt Rentals (2) Mt. Pleasant, MI Orlando, FL Tavares, FL Batavia, OH & Maumee, OH Recently Completed Burlington Coat Factory Camp
Slide 21: Financial Overview
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Slide 22: Capital Structure, Credit Metrics
Capital Structure, Credit Metrics Debt Maturities $ in millions $325.0 (1) $120.0 $125.0 $100.0 $106.6 $100.0 $100.0 $80.0 $68.6 $60.0 $60.0 $50.0 $50.0 $40.0 $40.2 $20.0 $5.2 $0.0 2019 2020 2021 $0.0 2022 2023 2024 2025 2026 (2) 2027 2028 2029 2030 Revolving Credit Facility Mortgage/Unsecured Debt
Slide 23: Investment Summary Highlights
Investment Summary Highlights ➢ Investment grade credit rating ➢ Highest-quality retail real estate ➢ Most secure cash flows ➢ Strongest balance sheet ➢ Proven track record of execution ➢ Consistent dividend growth ➢ Robust growth trajectory 22
Slide 24: DEVELOP | ACQUIRE | PARTNER
AGREE REALTY CORPORATION DEVELOP | ACQUIRE | PARTNER ADC NYSE