Cto Realty Growth, Inc. · NYSE:CTO
Cto Realty Growth — Consolidated Tomoka Land — Investor Presentation (March 2016)
69 slides from Cto Realty Growth's investor presentation, Mar 7, 2016
Slide 1: Year End 2015 Investor Presentation
(NYSE MKT: CTO) Year End 2015 Investor Presentation Published: March 7, 2016
Slide 2: Forward-looking statements
If we refer to “we,” “us,” “our,” or “the Company,” we mean Consolidated-Tomoka Land Co. and its consolidated subsidiaries. Certain statements contained in this presentation (other than statements of historical fact) are forward-looking statements. Words such as “believe,” “estimate,” “expect,” “int
Slide 3: A Snapshot
A Snapshot ($ in millions except share data) Positioned for Growth As of December 31, 2015 (unless otherwise noted) Assuming the reinvestment of dividends Total debt reflects face value for Convertible Notes of $75mm Includes restricted cash CTO: 2015 Share Performance (1) -5.5% RMZ Index: 2015 Inde
Slide 4: A Snapshot: Asset Rich
Land & Subsurface 10,500+ acres (All in City of Daytona Beach, FL) 500,000± acres Subsurface Interests (2 operating wells w/royalty income) $56.0 million in land sales under contract Income Properties 1.7 million Square Feet of Owned Real Estate 40 Single-Tenant and Multi-Tenant Income Properties: 3
Slide 5: CTO's Formula for Success
Cash Flow PositiveFocus on growing high quality (consistent) cash flows Focus on geographic diversity/key markets Development LightLimit exposure to development Focus on bringing in high quality/experienced owner/operators (Tanger, Minto, Distribution Center company) Efficient G&AOnly 14 employees a
Slide 6: Focused on Shareholder Returns
Monetizing Land$34.9mm in sales (241+ acres) (1) , $144k/acre Transformative Deals76.5 acres sold - 630,000 sq ft distribution center (Completed) 38.93 acres sold - 350,000 sq ft outlet center (Under construction) Investment in IncomeInvested approx. $183.2mm (1) in 24 properties, 7 new states Growi
Slide 7: Stock Performance (YE 2011 through 2/19/16)
Stock Performance (YE 2011 through 2/19/16) Aug 2014: Sale of 76.5 Acres – Distribution Center Nov 2015: Sale of 38.9 Acres – Tanger Outlets $27.07 stock price at 12/31/11 New Management Team since August 2011 CTO Total Return since 12/30/11: 79.1% CAGR since 12/30/11: 14.98%
Slide 8: Share Price Performance
Share Price Performance 1 year, 3 year and 5 years ended December 31, 2015 (adjusted for dividends) Symbol 1 year 3 years 5 years CTO -5.5% 70.7% 83.7% S&P 500 SPX 1.4% 51.9% 79.8% REIT Index RMZ 2.5% 36.5% 74.4% Russell 2000 RTY -4.4% 39.0% 54.9% JOE 0.7% -19.8% -15.3% TRC -35.0% -29.6% -28.3% FOR
Slide 9: Annual Results for 2011 – 2015
Total Revenues ($000’s) Operating Income ($000’s) Annual Results for 2011 – 2015 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015 Basic Earnings Per Share Positive Trends Book Value Per Share CAGR: 35.0% CAGR: 224.5% CAGR: 4.1% CAGR: 188.8%
Slide 10: Focus on Income Investments
Focus on Income Investments(1) Annual Results 2011 – 2015 ($ in millions) Aggregate acquisitions made in each year excluding dispositions and for 2015 including investment in real estate venture
Slide 11: Monetizing our Land – Executing our Strategy
Monetizing our Land– Executing our Strategy Annual Land Sales for 2005 – 2015 (Land Sales in $000’s) Multi-family included in residential (1)
Slide 12: G&A Expenses – Operating Efficiently
G&A Expenses – Operating Efficiently ($’s in millions) Annual Results for 2012 thru 2015 % of Market Cap (5) 1.86% 2012 2013 2014 2015 Reported G&A $6.6 $5.4 $7.0 $8.8 Less: Adjustments (1) Stock Compensation (2) (1.0) (0.9) (1.3) (2.2) Environmental Reserves (3) (0.7) - (0.1) (0.9) Other G&A(4) (0.
Slide 13: Balance Sheet - Highlights
Balance Sheet - Highlights as of December 31, 2015 Excludes approx. $11.3 million attributable to 6 acre beachfront land related to real estate venture in which CTO has a 50% stake but consolidates 100% of value for land interest Avg Basis for 10,500 acres of Land = $4,007/acre (1) Basis in Subsurfa
Slide 14: Income Properties Geographic Exposure
Location of Loan Investments (also one in PR) Number of Income Property Investments CTO Headquartered in Daytona Beach, FL 1 3 9 3 17 1 1 1 1 3 Income Producing Investments % of total rent revenues as of December 31, 2015 (excluding self-developed multi-tenant properties) Geographic Exposure (1) Flo
Slide 15: Top Single Tenants by Rent
Income Properties Top Single Tenants by Rent As of December 31, 2015 Approx. 54.3% of rent from Investment Grade tenants Guaranteed by Holiday CVS, L.L.C. a wholly-owned subsidiary of CVS Caremark (1)
Slide 16: Top Income Properties
Income Properties Top 10 Income Properties (1)(2) Tenant Tenant Type Market Property Type Remaining Lease Term Sq. Feet Wells Fargo Building Single Tenant Raleigh Office Class A 8.8 450,393 245 Riverside Multi-Tenant Jacksonville Office Class A 4.9 136,856 Hilton Grand Vacations Single Tenant Orland
Slide 17: 2015 Acquisition: Wells Fargo Building (Raleigh, NC)
2015 Acquisition Income Properties Core Investment Wells Fargo Building (Raleigh, NC) Single-Tenant $42.3mm Investment Single-Tenant Class A Office Rent @ 50% below market Investment basis - $94/sq. ft. or approx. 50% below replacement cost 9.1 years weighted average remaining on lease @ acquisition
Slide 18: 2015 Acquisition: Riverside (Jacksonville, FL)
2015 Acquisition Income Properties Core Investment 245 Riverside (Jacksonville, FL) Multi-Tenant $25.1mm Investment Class A Office Strong Retail/Residential development activity in area Investment basis ($185/sq ft) below replacement cost 5.4 years weighted average remaining on leases @ acquisition
Slide 19: 2015 Acquisition: The Container Store (Glendale, AZ)
2015 Acquisition Income Properties 14.7 years remaining on lease @ acquisition 3-mi Pop. 106,525 3-mi Avg HHI $76,173 23,329 Square Feet 2015 New Construction Single-Tenant, Triple Net Lease Outparcel to Macerich’s Arrowhead Mall (avg. sales of $650 per sq. ft.) Major renovation of mall announced by
Slide 20: 2014 Acquisition: Whole Foods Market Centre
2014 Acquisition Income Properties Core Investment 7.1 years weighted average remaining on leases @ acquisition 59,341 Square Feet - 95% Occupied 3-mi Pop. 68,157 3-mi Avg HHI $63,561 36,000 square feet (or 61% of property) leased to free standing Whole Foods Market BBB- Credit 9 yrs remaining on le
Slide 21: Opportunistic Investment: Grove at Winter Park
Opportunistic Investment Income Properties Repositioned Asset Approx. 112,000 sq ft 14.35 acres 548 Parking Spaces 3-mi Pop. 93,236 3-mi Avg HHI $59,994 Immediate area experiencing strong real estate growth/new development Grove at Winter Park (Winter Park, FL) Multi-Tenant $3.1mm Investment Negotia
Slide 22: Core Acquisition: Big Lots (Germantown, MD)
Core Acquisition Income Properties Infill w/Strong Demographics 9 years remaining on lease BBB- Credit 3-mi Pop. 90,931 3-mi Avg HHI $105,968 25,589 Square Feet Low basis Below market rent rate Big Lots (Germantown, MD) $5.0mm Investment
Slide 23: Potential Disposition: 14-Property Portfolio
Income Properties Potential Disposition: Taking Advantage of market valuation Bank of America Laguna Beach, CA Tenant Tenant Type Market Bank of America Single Tenant Garden Grove, CA Bank of America Single Tenant Westminster, CA Bank of America Single Tenant Laguna Beach, CA Bank of America Single
Slide 24: Improving Income Portfolio Demos
Income Properties Improving Income Portfolio Demos Total Single Tenant Portfolio: Average 3 mi. Population: 103,177 Average 3 mi. Household Income: $80,476 Big Lots & Container Store Glendale, AZ Lowe’s Katy (Houston), TX As of December 31, 2015
Slide 25: Self-Developed Properties
Self-Developed Properties: weighted average occupancy 91% Income Properties as of December 31, 2015 Concierge Office 22,000 sq. ft. Year Built: 2009 100% leased Major Tenants Merrill Lynch KB Homes Mason Commerce Center 31,000 sq. ft. Year Built: 2009 100% leased Major Tenants State of Florida Willi
Slide 26: 2015 Dispositions – Exit Smaller Markets
2015 Dispositions – Exit Smaller Markets Income Properties Recycling Capital = Improving Portfolio Quality $24.3 million in Proceeds All 6 properties Sold were leased to an affiliate of ($’s in millions) Weighted average exit cap rate 7.29% (Favorable to low end of Guidance) Sales price per square f
Slide 27: Where does the Stock Market Value our Land?
Land Holdings Where does the Stock Market Value our Land? As of December 31, 2015 (unless otherwise noted) Convertible Debt included at $75mm face value Amount excluding Def Tax Liability for 1031 gains = deferred tax asset (net) Assumed a 7% cap rate for value of Income Properties For 10,500 acres
Slide 28: Harvesting Value: Completed Land Transactions
Land Holdings 20.96 acres - $30k/ac Harvesting Value: Completed Land Transactions (2012 to 2015) Sold 241.91 Acres = Average Gross Price » $144k/acre (1) DISTRIBUTION CENTER VICTOR INDIGO LAKES LLC 75.60 acres - $103k/ac 3.06 acres - $128k/ac 2.02 acres - $317k/ac 3.41 acres - $382k/ac 6.23 acres -
Slide 29: Harvesting Value: Potential Land Transactions
Land Holdings WEST OF I-95 Potential Transaction 1 Buyer: Minto Communities Approx. 1,600 acres Potential Transaction 2 Approx. 17 +/- acres EAST OF I-95 Potential Transaction 3 Approx. 73 +/- acres Potential Transaction 4 Buyer: North American Approx. 85 +/- acres Harvesting Value: Potential Land T
Slide 30: Development Activity on CTO Land
Land Holdings Development Activity on CTO Land There can be no assurances regarding the likelihood or timing of the potential transaction with Minto, or if it occurs, the final terms including sales price Date Sold Acres Investment (1) Size (Sq Ft) Jobs (1) Open Date (1) Distribution Center Aug 2014
Slide 31: Potential Land Sale – Minto Communities
Land Holdings Potential Land Sale – Minto Communities Approximately 1,600 Acre Parcel Age-Restricted Planned Residential Community Across from LPGA International Golf Club 3,400+/- single-family homes Golf-cart friendly lifestyle Resort-style town center with clubhouse, restaurants, and recreational
Slide 32: Tomoka Town Center
18.10 Acres [Closed Dec ‘15] 38.93 Acres [Closed Nov ‘15] 23.77 Acres 37.26 Acres [Closed Dec ‘15] 4.39 Acres 57.79 Acres Land Holdings Approximately 180.24 Total Useable Acres in the Town Center Tomoka Town Center (A) (A) (A) (A) Option Parcels under contract with North American Development Group
Slide 33: Tomoka Town Center
Land Holdings Tomoka Town Center (A) (A) (A) (A) Option Parcels under contract with North American Development Group
Slide 34: 2015 Land Sale – Tanger Outlets
Land Holdings 2015 Land Sale – Tanger Outlets Transformational Transaction SALES PRICE $9.7 MILLION 38.93 Acres Sold November 2015 Upscale Outlet Shopping Center Estimated development cost - $100mm 350,000 square feet 80-90 Retail Stores No restaurant/F&B retail w/in the Outlet Center Projected 400
Slide 35: Tanger Outlets as of 2.11.16
Land Holdings Tanger Outlets as of 2.11.16
Slide 36: Tanger Outlets Conceptual
Land Holdings Tanger Outlets Conceptual
Slide 37: 2015 Land Sale – Integra Land Co.
Land Holdings 2015 Land Sale – Integra Land Co. Approximately 14.98 Acre Parcel Multi-Family Rental Community Estimated 260+ rental apartments Received planning/entitlement approvals Multi-Family Project SALES PRICE $2.4 MILLION 14.98 Acres Sold December 2015 Under Construction
Slide 38: Integra as of 2.11.16
Land Holdings Integra as of 2.11.16
Slide 39: 2015 Land Sale – North American
Land Holdings 2015 Land Sale – North American Sold 37.26 Acre Parcel Use: Mixed Use Retail/Commercial Mixed Use Retail/Commercial SALES PRICE $5.2 MILLION 37.26 Acres Sold December 2015
Slide 40: 2015 Land Sale – Sam's Club
Land Holdings 2015 Land Sale – Sam’s Club Approximately 18.10 Acre Parcel Use: Membership Only Warehouse Club Membership Only Retail Warehouse SALES PRICE $4.5 MILLION 18.10 Acres Sold December 2015 Before Planning Board March 2016
Slide 41: CarMax as of 2.11.16
Land Holdings CarMax as of 2.11.16 6.23 Acres Sold December 2013
Slide 42: TopBuild as of 2.11.16
Land Holdings TopBuild as of 2.11.16 20.96 Acres Sold October 2014
Slide 43: 2014 Land Sale – Distribution Center
2014 Land Sale – Distribution Center SALES PRICE $7.8 MILLION 630,000 sq ft refrigerated facility 75.60 Acres Estimated 400 jobs Land Holdings Stock Cars Aren’t the Only Things that Move Fast in Daytona Development started Q3 2014 and Facility Opened Q2 2015
Slide 44: Real Estate Venture – Ocean Front Property
Land Holdings Real Estate Venture – Ocean Front Property There can be no assurances regarding the likelihood or timing of a potential sale or other transaction related to this land, or if a transaction does occur, the final terms including sales price 6.04 Acre Parcel on Daytona Beach 3.63 Developab
Slide 45: Commercial Loan Investments
Loan Investments Commercial Loan Investments As of December 31, 2015 $10.0mm Mezzanine Loan Dallas, TX Rate: LIBOR + 725 Maturity: Sept. ‘16 $9.0mm B-Note Sarasota, FL Rate: LIBOR + 750 Maturity: June ‘16 $5.0mm Mezzanine Loan Atlanta, GA Rate: 12% fixed Maturity: Feb ‘19 $38.5 million invested (1)
Slide 46: Commercial Loan Investments Returns
Loan Investments Commercial Loan – Investments Returns Strong Risk-Adjusted Yields As of December 31, 2015 Completed Loan Investment Location Loan Amount Term (2) (Years) IRR Mortgage Loan – Glenn Hotel Atlanta, GA $17.5 0.4 39.39% Construction Loan – Container Store Glendale, AZ $6.2 1.1 7.81% Mort
Slide 47: Subsurface Interests (500,000 Acres)
Approximately 95% of total subsurface acres Remaining 5% of total subsurface acres ü ü ü ü ü ü Counties with active or historic oil/gas production (1) ü ü Subsurface Interests Subsurface Interests (500,000 Acres) Average success rate for wells drilled in Florida between 1995-2008 was 77% (1) April ‘
Slide 48: Subsurface Interests Leases
Lease with Kerogen Florida Energy Co. Amended 8-year oil exploration lease Sept 2015 $175k payment - drilling requirements Sept 2015 $1.2mm payment – 5th year rent payment Leased acres total 25,000 in Hendry County, FL Renewable each September for remaining 3 years at Lessee’s option 2015: $1.86mm i
Slide 49: Golf Operations
Golf Operations Golf Operations Operating Results ($millions) Membership Count For 2011 through 2015 2011 2012 2013 2014 2015
Slide 50: Liquidity and Leverage
Liquidity and Leverage as of December 31, 2015 Liquidity Position (excluding restricted cash) ($ in 000’s) Leverage Position ($ in millions) Total Commitment of Credit Facility = $75 million Amount outstanding is face value of the Convertible Notes 30-Day LIBOR plus 135-225 bps Maturity includes fir
Slide 51: 2015 Actual Results - 2016 Guidance
2015 2016 Earnings per share (on a fully diluted basis) $1.44/ share $2.75-$3.00/share Acquisition of Income-Producing Assets $96.2mm (1) $70mm - $85mm Target Investment Yields (Initial Yield – Unlevered) 6% - 8% 6% - 8% Disposition of Non-Core Income Properties $24.3mm $15.0mm - $25mm (2) Target Di
Slide 52: Share Repurchase Program
Share Repurchase Program Year Shares Repurchased Investment Average Price/Share Prior to 2012 4,660 $104,648 $22.46 2012 14,634 $453,654 $31.00 2014 25,836 $927,913 $35.92 2015 (1) 119,403 $6,484,843 $54.31 Totals/ Average 164,533 $7,971,058 $48.45 Share Repurchase Program (Authorized in 2008)$8.0 m
Slide 53: Shareholder Friendly / Strategic Alternatives Review
Hired Deutsche Bank in Feb. 2016 to explore Strategic Alternatives Share repurchases: approx. 189,000 shares since 2012 Board of Directors reduced to 7 in 2014 from 11 in 2011 Increased dividend since 2011 – from $0.04 to $0.08 per share (annualized) Annual election of Directors (eliminated staggere
Slide 54: Top Institutional Shareholders
Shareholder Shares % Wintergreen Advisers LLC 1,543,075 25.96 BlackRock Institutional 317,386 5.34 Dimensional Fund Advisors, Inc. 186,939 3.14 Vanguard Group, Inc. 178,654 3.01 Andalusian Capital Partners, LP 174,979 2.94 Carlson Capital LP 107,604 1.81 Fenimore Asset Management 86,280 1.45 State S
Slide 55: Experienced Team
John P. Albright President and CEO Archon Capital, a Goldman Sachs Company Morgan Stanley Crescent Real Estate Equities 2011 Mark E. Patten Senior Vice President and CFO Simply Self Storage CNL Hotels & Resorts Vistana Inc. KPMG 2012 Daniel E. Smith Senior Vice President – General Counsel and Corpor
Slide 56: Board of Directors
Director Since John P. Albright President & Chief Executive Officer of the Company 2012 John J. Allen President of Allen Land Group, Inc. 2009 Jeffry B. Fuqua Chairman of the Board of the Company and President of Amick Holdings, Inc. 2009 William L. Olivari Certified Public Accountant and Partner of
Slide 57: New Businesses and Investment
New Businesses and Investment Rising Tide Lifts All Boats Non-Stop service between JFK and Daytona Beach starting January 2016 New Public Company (NYSE: BLD) $1B Market Cap 7,800 employees worldwide (Approx. 360 local employees) Publicly Traded REIT (NYSE: SKT) Owner/Operator of Upscale Outlet Shopp
Slide 58: Business/Employment Highlights
A B C G D F I L E O K Q N R Business/Employment Highlights Vibrant Business Environment Consolidated-Tomoka Land Co. (NYSE: CTO) 14 S P H J DIST – Distribution; HC – Healthcare; HM – Home Bldg; INS – Insurance, RET - Retail MFG – Manufacturing, O&G – Oil & Gas; UNIV – University; SPRT – Professional
Slide 59: Contact Us
Consolidated-Tomoka Land Co. 1530 Cornerstone Boulevard Daytona Beach, FL 32117 main: 386.274.2202 fax: 386.274.1223 email: info@ctlc.com web: www.ctlc.com NYSE MKT: CTO For additional information, please see our most recent Annual Report on Form 10-K, copies of which may be obtained by writing the
Slide 60: Appendix
Appendix
Slide 61: Where We are Located
Ci®© Highlights Portfolio Daytona Where We are Located CONSOLIDATED OE TOMOKA
Slide 62: Well-Positioned Land as of December 31, 2015
Well-Positioned Land as of December 31, 2015
Slide 63: Well-Positioned Land as of January 20, 2016
Well-Positioned Land as of January 20, 2016
Slide 64: FLORIDA HosprrL
FLORIDA HosprrL MEMORIAL MEDICAL CENTER 75 acres
Slide 65: Well Positioned Land: Industrial
Well Positioned Land: Industrial
Slide 66: Well Positioned Land: Williamson Crossing
Well Positioned Land: Williamson Crossing
Slide 67: Well Positioned Land: North of LPGA
Well Positioned Land: North of LPGA
Slide 68: Well Positioned Land: Bayberry II
Well Positioned Land: Bayberry II
Slide 69: Potential Office Development
Potential Office Development
Consolidated Tomoka Land — Investor Presentation (March 2016) on 6ix