Vital Infrastructure Property Trust · TSX:VITL.UN
Vital Infrastructure Property Trust — Northwest Healthcare Properties REIT — Q3 2024 Earnings Presentation
47 slides from Vital Infrastructure Property Trust's earnings presentation, Nov 15, 2024
Slide 1: Q3 2024 Financial Results Presentation
Northwest Healthcare Properties REIT Q3 2024 Financial Results Presentation TSX: NWH.UN November 15, 2024 Ormiston Hospital, New Zealand
Slide 2: Presenters and Contents
Presenters Contents Craig Mitchell CHIEF EXECUTIVE OFFICER Northwest & Healthcare Real Estate 3 Results (Proportionate basis)(1) 6 Highlights 7 Stephanie Karamarkovic CHIEF FINANCIAL OFFICER Q3 2024 Financial Performance 8 Q3 2024 Property Performance 14 Q3 2024 Capital Management 17 Mike Brady PRES
Slide 3: About Northwest
Grace Hospital, New Zealand Epworth Eastern Private Hospital, Australia Hospital Santa Luiza, Brazil About Northwest Northwest Healthcare Properties REIT (TSX: NWH.UN) owns, manages, and develops real estate exclusively focusing on tenants who are operators in healthcare, research, life sciences and
Slide 4: Why Invest In Northwest?
Eating Recovery Centre, US Hospital Santa Helena, Brazil Epworth Geelong, Australia Why Invest In Northwest? 1 High quality globally diversified healthcare real 4 Investor, tenant and operator relationships provide estate portfolio. long-term revenue stability. 2 Multiple initiatives underway to sur
Slide 5: Why Healthcare Real Estate?
Why Healthcare Real Estate? Northwest focuses on the cure segment of the healthcare real estate spectrum, a defensive asset class that provides attractive risk adjusted returns, driven by an aging population. Growing Growing need Sustained Shift of care to Increased M&A Transition demand for for lif
Slide 6: Results
Prins Hendriklaan 376, Netherlands Results NWH REIT | Q3 2024 FINANCIAL RESULTS PRESENTATION | 6
Slide 7: Q3 2024 Highlights
Australian Red Cross Blood Service, Australia Q3 2024 Highlights $1.1B ~1.5M Total debt repaid, refinanced or square feet of new, renewed and extended(1), including $736M repaid early lease extensions (2) completed with 2024/2025 maturities (~88% renewal retention) ~6.5% 4.9% G&A Cost Ratio(3), redu
Slide 8: Q3 2024 Financial Performance
Avive Clinic Mornington Peninsula, Australia Q3 2024 Financial Performance NWH REIT | Q3 2024 FINANCIAL RESULTS PRESENTATION | 8
Slide 9: Q3 2024 Financial Snapshot (consolidated basis)
Clinque Bleue, Canada Q3 2024 Financial Snapshot (consolidated basis) September 30, December 31, Financial Highlights 2024 2023 Variance $ Variance % Assets Under Management 8.7 9.9 (1.2) (12.1%) Gross Book Value(1) 6.3 7.6 (1.3) (17.1%) Debt(1) 2.8 3.6 (0.8) (22.2%) Debt to Gross Book Value(1) 43.6
Slide 10: Proportionate Income Statement (three months ended September 30)
Proportionate Income Statement (three months ended September 30) September 30, 2024 September 30, 2023 Proportionate Basis Change C$ Millions Proportionate Basis(1) Proportionate Basis(1) ($) (%) 4.9% Net Operating Income 69.4 82.8 (13.3) (16.1%) SPNOI growth(3), offset by impact of investment Manag
Slide 11: Proportionate Income Statement (nine months ended September 30)
Proportionate Income Statement (nine months ended September 30) September 30, 2024 September 30, 2023 Proportionate Basis Change C$ Millions Proportionate Basis(1) Proportionate Basis(1) ($) (%) 4.4% Net Operating Income 234.7 250.2 (15.4) (6.2%) SPNOI growth(3), offset by impact of investment Manag
Slide 12: Proportionate Balance Sheet
Proportionate Balance Sheet September 30, 2024 December 31, 2023 Proportionate Basis Change C$ Billions Proportionate Basis(1) Proportionate Basis(1) ($) (%) $1.3B Completed non-core asset Investment Properties(2) 4.3 5.7 (1.5) (25.8%) sales during YTD FY24, including $63m of unlisted Other Assets 0
Slide 13: NAV Bridge (QoQ)
NAV Bridge (QoQ)(1) $95M ~$21M Property revaluation loss for Transaction costs related to the quarter strategic initiatives $9.53 ( 0.39 ) ( 0.09 ) ( 0.02 ) $9.02 Global Manager 1.72 1.73 7.82 7.29 Q2 2024 FV Adjustments to IP Transaction Costs Other Q3 2024 Notes: (1) Expressed as $/unit. All value
Slide 14: Q3 2024 Property Performance
Maaststadweg 2-144, Netherlands Q3 2024 Property Performance NWH REIT | Q3 2024 FINANCIAL RESULTS PRESENTATION | 14
Slide 15: Net Operating Income Bridge
Net Operating Income Bridge ($M)(1) 4.9% $1.8M Divestment of Over 85% of non-core assets in Northwest’s rents SPNOI growth vs. prior Of additional development comparable period(1) income YoY line with strategy are indexed 90 (16.1) 1.8 2.9 82.8 80 (1.9) 69.4 70 60 50 Q3-2023 SPNOI Developments Dispo
Slide 16: Leasing Achievements
Hospital Sabara. Brazil Leasing Achievements Lease expiries & Region early Lease Retention % New Leases Early Lease terminations (sf) Renewals (sf) (sf) Extensions (sf) North America (96,600) 71,642 73.1% 27,261 Brazil (157,160) 157,160 100.0% - 706,619(2) Europe (79,105) 61,401 77.6% 19,701 ANZ (17
Slide 17: Q3 2024 Capital Management
Hospital e Maternidade, Brazil Q3 2024 Capital Management NWH REIT | Q3 2024 FINANCIAL RESULTS PRESENTATION | 17
Slide 18: Debt Maturity Profile
Remaining 2025 debt maturities Debt Maturity Profile $1.1B $736M of $345M(2), consisting of $125M Series G Convert and $220M(3) of Total debt repaid, Debt repaid with property level debt to be Northwest’s debt maturities refinanced or extended 2024/2025 maturities, at addressed through normal as at
Slide 19: Interest Rate Hedging Profile
Interest Rate Hedging Profile Cost of Debt is well hedged, managing risk. HEDGING MATURITY PROFILE September 30, December 31, 1,200 6.00% Rates 2024(1) 2023 Weighted Average Variable Debt 6.67% 7.85% 1,000 5.00% Weighted Average Interest Rate Weighted Average Fixed Rate (incl. 5.25% 5.54% 800 4.00%
Slide 20: Property Portfolio Overview
Belmont Private Hospital, Australia Property Portfolio Overview NWH REIT | Q3 2024 FINANCIAL RESULTS PRESENTATION | 20
Slide 21: Total Dispositions
Total Dispositions Investment Properties Disposition Proceeds ($M) YTD FY24, the REIT has achieved Region Period Proportionate Consolidated the following: Europe Q3-24 885.0 885.0 TOTAL – Q3 24 885.0 885.0 All regions Q1-24 164.0 165.2 $1.3B Total proportionate disposition proceeds All regions Q2-24
Slide 22: Global Portfolio Overview
Global Portfolio Overview Global Summary 186 13.4 16.1M 96% $8.7B(1) PROPERTIES WALE (YRS) GLA (SQFT) OCCUPANCY AUM BRAZIL CANADA USA NETHERLANDS GERMANY AUSTRALIA NEW ZEALAND 8 Properties 48 Properties 15 Properties 16 Properties 38 Properties 47 Properties 14 Properties 16.7 WALE (YRS) 5.2 WALE (Y
Slide 23: NOI Is Strongly Diversified By Regions & Asset Mix
NOI Is Strongly Diversified By Regions & Asset Mix(1) Income from stable rent collections and long-term leases. REGIONS Q3 2024 ASSET MIX Life Sciences Brazil 1% North 19% Q3 2024 99% America 17% Collections Rate 32% 34% 2% MOB 4th consecutive year Hospital and of >98% collections Q3 2023 35% 38% Eu
Slide 24: Lease Maturity Profile
Lease Maturity Profile(1) 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2024 2025 2026 2027 2028 2029 2030 2031 Thereafter North America Brazil Europe Australasia Total 2024 2025 2026 2027 2028 2029 2030 2031 Post 2031 Total North America 1.3% 8.7% 9.7% 10.9% 17.6% 8.1% 7.4% 6.1% 30.3% 100.0% Brazil 0
Slide 25: GRESB Results
Macarthur Health Precinct – Stage 1, Australia GRESB Results In October 2024, GRESB again announced Vital Vital & Northwest Healthcare (managed by Northwest) and recognized as Northwest Healthcare as Global Sector Leaders Vital & Northwest achieved a (the highest possible award) for ESG across Globa
Slide 26: Outlook
Cambrian Centre, Canada Outlook NWH REIT | Q3 2024 FINANCIAL RESULTS PRESENTATION | 26
Slide 27: 2024 and into 2025 focus
RDX Development, Australia In 2024 and into 2025, the REIT’s focus will be continuing to: 1 Explore opportunities to surface embedded value from within our portfolio 2 Strengthen the balance sheet and become an institutional quality REIT 3 Simplify our geographic footprint, and improve efficiencies
Slide 28: Northwest Healthcare Properties REIT - Summary
Hospital Caxias, Brazil Northwest Healthcare Properties REIT - Summary Ticker NWH.UN Listed Exchange TSX Distribution Payable (C$) $0.03 / Monthly Unit Price(1) $5.09 Market Capitalization (C$)(1) $1.26 Billion Distribution Yield(1) 7.07% 52-Week Trading Range(1) $3.93-$5.88 Volume Weighted Avg. Pri
Slide 29: Contact Information
Hys Centre, Canada Contact Information Craig Mitchell, CEO craig.mitchell@nwhreit.com Mike Brady, President mike.brady@nwhreit.com Stephanie Karamarkovic, CFO stephanie.karamarkovic@nwhreit.com Alyssa Barry, Investor Relations alyssa.barry@nwhreit.com 604-997-0965 NWH REIT | Q3 2024 FINANCIAL RESULT
Slide 30: Disclaimer
Disclaimer This presentation provides a summary description of Northwest Healthcare Properties Real Estate unchanged (including exchange rates remaining constant, local real estate conditions remaining Investment Trust (“NWH” or the “REIT”). This presentation should be read in conjunction with and i
Slide 31: Appendix
Ascot Hospital, New Zealand Appendix NWH REIT | Q3 2024 FINANCIAL RESULTS PRESENTATION | 31
Slide 32: Proportionate Income Statement (three months ended September 30)
Proportionate Income Statement (three months ended September 30) September 30, 2024 September 30, 2023 Proportionate Basis Change Proportionate Proportionate C$ Millions IFRS Basis Adjustments(1) Basis(1) Basis(1) ($) (%) Net Operating Income 82.2 (12.8) 69.4 82.8 (13.3) (16.1%) Management Fee Incom
Slide 33: Proportionate Income Statement (nine months ended September 30)
Proportionate Income Statement (nine months ended September 30) September 30, 2024 September 30, 2023 Proportionate Basis Change C$ Millions IFRS Basis Adjustments(1) Proportionate Proportionate ($) (%) Basis(1) Basis(1) Net Operating Income 271.6 (36.9) 234.7 250.2 (15.4) (6.2%) Management Fee Inco
Slide 34: Proportionate Balance Sheet
Proportionate Balance Sheet September 30, 2024 December 31, 2023 Proportionate Basis Change C$ Billions IFRS Basis Adjustments(1) Proportionate Proportionate ($) (%) Basis(1) Basis(1) Investment Properties(2) 5.4 (1.2) 4.3 5.7 (1.5) (25.8%) Other Assets 0.9 (0.4) 0.5 0.4 0.2 42.8% Total Assets 6.3 (
Slide 35: G&A Summary
G&A Summary C$ Millions Index Q3-2023 Q4-2023 Q1-2024 Q2-2024 Q3-2024 ~$3.7M General and Administrative Expenses 19.3 15.0 17.4 15.5 17.3 Estimated annualized G&A Less: Unit-Based Compensation A 1.9 (0.7) 2.6 0.3 (0.5) savings(4) as result of 16% global workforce reduction (~50 staff). Less: Severan
Slide 36: Northwest's Strategic Healthcare Property Platform
Northwest's Strategic Healthcare Property Platform Core Preserve, Build and Grow Competencies Investment Development Asset Management Management Management Wholly Owned Fee By The Reit Generating Funds Management JV’s INVESTMENTS Direct Property Unlisted Ownership Public Institutional Companies JVs
Slide 37: Deep Connections With Key Operating Partners
Deep Connections With Key Operating Partners Northwest has deep relationships with the biggest brands in health and health sciences across its regions. NWH REIT | Q3 2024 FINANCIAL RESULTS PRESENTATION | 37
Slide 38: Development Strategy (Vital Healthcare Property Trust)
Development Strategy (Vital Healthcare Property Trust) Northwest has a market leading development team in ANZ, with an unmatched depth of experience. Meeting the needs of our Earnings and capital growth Enhancing the portfolio operator partners PIPELINE1 FOCUS NZ $356m ~NZ$138m of spend remaining of
Slide 39: Top 10 Tenants
Top 10 Tenants The REIT’s 10 largest tenants for the three months ended September 30, 2024. Top 10 tenants represent 33.7% of Proportionate Rent The REIT's five largest tenants include: Tenant Region % # of locations 1 Rede D'Or, Brazil: The largest integrated health care network in Brazil 1 Rede D'
Slide 40: Case Study: Capital Lite Investment Strategy
Palm Beach Currumbin Clinic, Australia Case Study: Capital Lite Investment Strategy (Vital Healthcare Property Trust) Leveraging our experience to increase value: Asset-lite business models have been associated with better return on assets, lower profit volatility and greater adaptability in an ever
Slide 41: Case Study: Vital Healthcare Property Trust
Case Study: Vital Healthcare Property Trust (NZX:VHP)(1) Northwest owns a ~28.5% interest in the only specialist healthcare landlord on the NZX and retains 100% of the management rights. NT 2 2 ~C$0.9bn QLD 14 PROPERTIES 3 (NZ) WA SA 8 NSW Royston Hospital, New Zealand VIC 12 ~C$1.9bn 7 Vital has As
Slide 42: Case Study: Commitment to ESG
Macarthur Health Precinct Stage 1, Australia Case Study: Commitment to ESG Completion of targeted 6-star Green Star rated building Project Overview ▪ Northwest Healthcare Properties, as manager of Vital Trust, acquired the development rights for a ~6.9acre site in Sydney, Australia (2022) ▪ A master
Slide 43: Case Study: Jerry Coughlan Health & Wellness Centre
Jerry Coughlan Health & Wellness Centre, Canada Case Study: Jerry Coughlan Health & Wellness Centre Project Overview ▪ Design and construction of a purpose built, four-storey medical office and ambulatory care hybrid facility, comprising 67,300sf of healthcare accommodation ▪ 4 high volume operating
Slide 44: Case Study: Epworth Healthcare, Melbourne Australia
Case Study: Epworth Healthcare, Melbourne Australia Northwest has supported Epworth for over 15+ years with expansion opportunities, advice and capital. Developments have added to the quality and value of assets, driving operational benefits and efficiencies that attract practitioners. ▪ Not-for-pro
Slide 45: Experienced Management Team
Experienced Management Team Craig Mitchell, CEO Tracey Whittall, COO Craig Mitchell has more than 20 years’ experience Prior to joining Northwest in 2024, Tracey specializing in the property industry in Australia. His was COO at Flexiti, a leading financial services company previous roles include Ex
Slide 46: Experienced Board Of Trustees
Experienced Board Of Trustees Northwest's strong governance framework ensures diversity is considered in determining optimal board composition. Northwest's experienced Board of Trustees functions independently of management, Dale Klein Peter Aghar Graham Garner Bobby Julien ensuring effective Non-Ex
Slide 47: Non-IFRS Measures
Dalbergstr. 22, Germany Non-IFRS Measures 1. FFO 2. AFFO 3. FFO per Unit 4. AFFO per Unit 5. AFFO Payout Ratio 6. EBITDA 7. Adjusted EBITDA 8. Investment Properties on a Proportionate Basis 9. Proportionate Management Fees 10. Distributions 11. Net Asset Value (“NAV”) 12. Net Operating Income (“NOI”
Northwest Healthcare Properties REIT — Q3 2024 Earnings Presentation on 6ix