Peakstone Realty Trust · NYSE:PKST
Peakstone Realty Trust — Merger or Acquisition (November 2024)
27 slides from Peakstone Realty Trust's merger presentation, Nov 4, 2024
Slide 1: Acquisition of Industrial Outdoor Storage Portfolio
Acquisition of Industrial Outdoor Storage Portfolio November 4, 2024
Slide 2: Disclaimers / Forward-Looking Disclosure
Disclaimers / Forward-Looking Disclosure This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934,
Slide 3: Agenda
01 02 03 04 05 Agenda Strategic Acquisition Industrial Outdoor Storage (IOS) Fundamentals Transaction Highlights Post-Transaction Industrial Segment Peakstone’s Path Forward
Slide 4: Peakstone Enters the Industrial Outdoor Storage (IOS) Sector
Peakstone Enters the Industrial Outdoor Storage (IOS) Sector ACQUISITION OF $490MM PREMIER IOS PORTFOLIO 51 properties – 45 Operating Assets / 6 Redevelopment Assets Strategically compelling off-market acquisition that will drive long-term shareholder value Significantly enhances growth pr
Slide 5: Agenda: Industrial Outdoor Storage (IOS) Fundamentals
Agenda 01 02 03 04 05 Strategic Acquisition Industrial Outdoor Storage (IOS) Fundamentals Transaction Highlights Post-Transaction Industrial Segment Peakstone’s Path Forward
Slide 6: IOS – Compelling Opportunity
…IOS sites in infill submarkets are priced to deliver risk-adjusted expected returns that are superior to those available on most other commercial real estate property investments…Green Street Advisors1 IOS – Compelling Opportunity 6 02 Large, highly fragmented sector Significant and persistentsuppl
Slide 7: IOS – Sector Dynamics
Barriers to Supply Limited infill land zoned for IOS near major logistics hubs Existing IOS supply reduced each year due to redevelopment Municipalities generally do not favor IOS development / rezoning NIMBYism Lower relative taxes Additional truck traffic Large ($200bn+)1, Highly Fragmented Sector
Slide 8: Agenda: Transaction Highlights
Agenda 01 02 03 04 05 Strategic Acquisition Industrial Outdoor Storage (IOS) Fundamentals Transaction Highlights Post-Transaction Industrial Segment Peakstone’s Path Forward
Slide 9: Key Deal Metrics
Key Deal Metrics 9 Operating Assets Redevelopment Assets Property Count Purchase Price (mm) Cap Rate / Target Yield In-Place ABR (mm) Est. Mark-to-Market Usable Acres 03 45 $427 $22.1 358 6 $63 NA 82 5.2%1 / ~7.0-7.5% ~7.5-8.0% ~70% NA Notes: Data as of November 4, 2024. Based on IOS Portfolio ABR,
Slide 10: Diversified, Infill Focused Portfolio Across the U.S.
Diversified, Infill Focused Portfolio Across the U.S. 10 Notes: Data as of November 4, 2024. Based on IOS Portfolio ABR. Other MSAs includes 14 additional MSAs. 03 Acquired IOS Operating Assets IOS Portfolio National Footprint Acquired IOS Redevelopment Assets Operating Assets Top Markets¹
Slide 11: High-Quality Operating Assets with a Broad Tenant Base
High-Quality Operating Assets with a Broad Tenant Base Notes: Data as of November 4, 2024. Peakstone Realty Trust has no affiliation, connection or association with and is not sponsored or approved by the tenants of its properties. Peakstone Realty Trust has not approved or sponsored its tenants or
Slide 12: Strategically Located Redevelopment Opportunities
Strategically Located Redevelopment Opportunities 82 acres to redevelop Est. 12-36 months to complete 7.5-8.0% Target Yield1 Est. $9-10.5mm of incremental NOI upon stabilization Strategically located assets near major supply chains and population centers Value Creation Opportunity 12 03 Savannah, GA
Slide 13: Strong Growth Profile
Strong Growth Profile 13 03 Object / Logo IOS Value Creation 02 03 01 Additional income generation through six redevelopment sites Annual rent escalations averaging 2.6%1generate consistent NOI growth Potential for ~70% Mark-to-Market opportunity1 Notes: Data as of November 4, 2024. For the Operatin
Slide 14: Agenda: Post-Transaction Industrial Segment
Agenda 01 02 03 04 05 Strategic Acquisition Industrial Outdoor Storage (IOS) Fundamentals Transaction Highlights Post-Transaction Industrial Segment Peakstone’s Path Forward
Slide 15: Significantly Expands Industrial Footprint
Significantly Expands Industrial Footprint 15 04 Notes: Map reflects top 10 MSAs by Pro Forma Industrial Segment ABR. Data is presented on an as-adjusted basis by combining the Industrial segment and IOS Portfolio as of September 30, 2024, and November 4, 2024, respectively, and not a pro forma basi
Slide 16: IOS Portfolio Grows Industrial Segment to ~40% of ABR
IOS Portfolio Grows Industrial Segment to ~40% of ABR1 Property Count Rentable SF / Operating Usable Acres Redevelopment Usable Acres WALT (years)2 % Leased3 % Leased to IG Tenants2,4 0 acres 100% 6.3 58% 9.0mm SF 19 Industrial + 82 acres ~100% 4.5 47% 358 acres 51 IOS 82 acres ~100% 5.7 55% 9.0mm S
Slide 17: Pro Forma Capitalization and Debt Maturity Schedule
Pro Forma Capitalization 04 Pro Forma Debt Maturity Schedule Notes: $ in millions. Data as of September 30, 2024, reflective of subsequent events. Figures might not sum to 100% due to rounding. Includes one new $175mm unsecured term loan and three separate financings totaling $110 million, each secu
Slide 18: Agenda: Peakstone's Path Forward
Agenda 01 02 03 04 05 Strategic Acquisition Industrial Outdoor Storage (IOS) Fundamentals Transaction Highlights Post-Transaction Industrial Segment Peakstone’s Path Forward
Slide 19: IOS – Highly Complementary Industrial Business
IOS – Highly Complementary Industrial Business 19 Consistent with Management of Traditional Industrial Leverages existing team which includes IOS specialists Similar credit underwriting Comparable asset management requirements Similar Tenant Profile Industrial tenants National and regional tenants N
Slide 20: Go-Forward Strategy
Go-Forward Strategy Based on Normalized EBITDAre. Normalized EBITDAre is a non-GAAP financial measure. For a reconciliation to the most directly comparable GAAP financial measure, see slide 23. Weighted average based on Existing Portfolio ABR excluding Other segment, plus IOS Portfolio ABR. At listi
Slide 21: PKST Portfolio Overview Post-Transaction
PKST Portfolio Overview Post-Transaction Notes: Industrial segment data is presented on an as-adjusted basis by combining the Industrial segment and IOS Portfolio as of September 30, 2024, and November 4, 2024, respectively, and not a pro forma basis under Article 11 of Reg. S-X. Figures might not s
Slide 22: Appendix
VX] Peakstone APPENDIX
Slide 23: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures 23 Notes: $ in thousands. Reflects the reconciliation of net income (loss) to Normalized EBITDAre for the quarter ended September 30, 2024, as adjusted for the IOS Portfolio acquisition and various separate financing transactions that the Company entered
Slide 24: Definitions
Definitions Term Definition ABR (“Annualized Base Rent”) For each applicable segment of the PKST portfolio pre-transaction (“Existing Portfolio”), “Annualized Base Rent” or “ABR” means the contractual base rent excluding rent abatements and deducting base year operating expenses for gross and modifi
Slide 25: Definitions (cont'd)
Definitions (cont’d) Term Definition EBITDAre “EBITDAre” is defined by The National Association of Real Estate Investment Trusts ("NAREIT") as follows: (a) GAAP Net Income plus (b) interest expense plus (c) income tax expense plus (d) depreciation and amortization plus/minus (e) losses and gains on
Slide 26: Definitions
Definitions Term Definition Mark-to-Market For PKST Industrial segment pre-transaction, “Mark-to-Market” is based on management’s estimate of market rents as of September 30, 2024, divided by in-place monthly contractual base rent as of that date. No assurance can be given that expiring leases will
Slide 27: Definitions (cont'd)
Definitions (cont’d) Term Definition Net Debt “Net Debt” is total debt less Cash. Target Yield For the IOS Portfolio, based on management’s estimate of market rents as of November 4, 2024, divided by (i) in the case of the Operating Assets, the anticipated total investment consisting of the allocate
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