Agree Realty Corporation · NYSE:ADC
Agree Realty — Investor Presentation (January 2013)
21 slides from Agree Realty's investor presentation, January 2013
Slide 1: Agree Realty Corporation
AGREE REALTY CORPORATION
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation may include certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward- looking statements include, but are not limited to, our plans, objectives, expectations and intentions and other sta
Slide 3: Market Statistics
Market Statistics Focused on the acquisition and development of single tenant properties leased to industry leading retail tenants Ticker: NYSE: ADC (1) Recent Price: $28.63 Shares and OP Units Outstanding: 11,784,000 Current Annualized Dividend: $1.60 (1) Dividend Yield: 5.6% Current Market Cap: $3
Slide 4: Investment Highlights
Investment Highlights Disciplined investment approach Industry leading team Strategic retailer relationships High quality property portfolio Proven external growth strategy and platform Strong, growth-oriented balance sheet Attractive, sustainable dividend yield 4
Slide 5: Agree Overview
Agree Overview Company Overview 109 Properties 3.3 million square feet of GLA 27 states Current occupancy 98% 88% national (61% investment grade) tenants 2012 Portfolio Activity Acquisition of 25 properties for $81.5 million Tenants include Lowe’s, Dollar General, Wawa, AutoZone Deve
Slide 6: Strategic Growth Through Disciplined Investments
Strategic Growth Through Disciplined Investments Single Tenant Net Lease Development Preferred developer status with national tenants Long-term net leases with first in class tenants Pre-leasing minimizes development risk Superior return on development cost Wawa – St. Petersburg, FL Single T
Slide 7: Executive Management – Experienced and Driven
Executive Management – Experienced and Driven Founded Agree Development in 1971 CEO and Chairman from the Company’s IPO Oversees all development and redevelopment in 1994 through January 2013. construction activities Developed over 8,000,000 square feet of Served as Project Manager for bot
Slide 8: Strong Tenant Base
Strong Tenant Base Select Investment Grade Tenants 62.6% Investment Grade* (% of annualized base rents) As of September 30, 2012 *Includes investment grade ratings as determined by S&P, Moody’s and Fitch, or NAIC 8
Slide 9: National Portfolio Anchored by Strategic Retailer Relationships
National Portfolio Anchored by Strategic Retailer Relationships 109 properties in 27 states 3.3 million square feet of GLA 9
Slide 10: Portfolio Stability and Historical Occupancy
Portfolio Stability and Historical Occupancy 2012 occupancy: 98% 5-year average occupancy: 98% 10
Slide 11: Well Staggered Expirations Mitigate Rollover Risk
Well Staggered Expirations Mitigate Rollover Risk Lease Expirations (Annualized base rent in millions) $35.0 $30.0 $29.3 $25.0 $20.0 $15.0 $10.0 $5.0 $2.5 $1.0 $1.5 $1.0 $0.0 $0.0 2012 2013 2014 2015 2016 Thereafter As of September 30, 2012 11
Slide 12: Evolution of Major Tenant Exposure
Evolution of Major Tenant Exposure Evolution of Major Tenant Exposure % of Total Company Annualized Base Rent All Other Tenants Walgreens Kmart Borders 12
Slide 13: 2012 Disposition of Non-Core Assets
2012 Disposition of Non-Core Assets All Borders exposure addressed in addition to continued culling of non-core assets June Charlevoix Commons - Charlevoix, MI March Kmart and Family Farm & Home September Anchored Center Former Borders Office Former Borders - Columbus, OH Building – Ann Arbor, MI 20
Slide 14: 2012 Commenced or Completed Development
2012 Commenced or Completed Development Recently Announced • Located in the heart of University of Michigan’s Central Campus • Redevelopment, pre-leased WALGREENS – RANCHO CORDOVA, CA McDONALD’S - SOUTHFIELD, MI under a 20 year agreement • $5.8 million – 18,000 sf • Ann Arbor historic district ANN A
Slide 15: Since April 2010 Launch of Acquisition Platform
Since April 2010 Launch of Acquisition Platform ACQUISITIONS 44 STATES 22 RETAIL SECTORS 15 AGGREGATE PURCHASE PRICE $157 million 2010-2012 ACQUISITION SUMMARY Average Purchase Price: $3.6 million Average Base Term: 17 Years Retail Sectors: Auto Parts, Auto Service, Pharmacy, Grocery, Apparel, Banks
Slide 16: A Balance Sheet to Support Growth
A Balance Sheet to Support Growth January/February 2012 – completed follow-on offering of 1,495,000 common shares at $24.75/share raising net proceeds of $35,151,000 June 2012 - closed on extension of $22.9 million term loan until 2019 with swapped interest rate at 3.62% beginning July 2013 De
Slide 17: Attractive and Well Covered Dividend
Attractive and Well Covered Dividend Current annualized dividend of $1.60; current dividend yield of 5.6% (based on $28.63 share price) 75 consecutive quarterly cash dividends since its IPO FFO Payout Ratio: 79%* Targeted FFO Payout Ratio: 75 – 85% *Based on dividend and FFO for the quarter
Slide 18: 2012 Strategic Priorities
2012 Strategic Priorities Strategic growth via STNL acquisition & development Continued diversification of portfolio Divestment of non-core assets Efficient recycling of capital 18
Slide 19: Appendix: Case Studies
Appendix: Case Studies ) \AGREE REALTY 4\ (CORPORATION
Slide 20: Case Studies: Capitalizing on Value Add Opportunities
Case Studies: Capitalizing on Value Add Opportunities Structural Flexibility Construction Management Kohl’s – Salt Lake City, UT AT&T – Wilmington, NC CHALLENGES: CHALLENGES: • Former Mervyns leasehold interest acquired by institutional • Seller failed to install landscaping and irrigation required
Slide 21: Case Studies: Capitalizing on Value Add Opportunities
Case Studies: Capitalizing on Value Add Opportunities Leveraging Tenant Geotechnical & Relationships Environmental Expertise Lowe’s – Concord, NC CVS – Atchison, KS CHALLENGES: CHALLENGES: • Walgreens exclusive use restrictions encumbered entire • Store constructed on geopiers due to unsuitable soil