The Rmr Group Inc. · NASDAQ:RMR
The Rmr — RMR Group — Investor Presentation (September 2024)
28 slides from The Rmr's investor presentation, Sep 6, 2024
Slide 1: Investor Presentation September 2024
1 Investor Presentation September 2024
Slide 2: Forward-looking statements and information about the REITs
2 This presentation contains information about Service Properties Trust, Diversified Healthcare Trust, Office Properties IncomeTrust, Industrial Logistics Properties Trust and Seven Hills Realty Trust (together, the REITs). The information regarding each REIT (each, a company) has been provided sole
Slide 3: Overview of The RMR Group (Nasdaq: RMR)
3 Overview of The RMR Group (Nasdaq: RMR)
Slide 4: Compelling Investment Opportunity
4 Diversified revenue sources from perpetual capital and private capital clients spanning all major commercial real estate sectors. Substantial earnings stability resulting from over 75% of services revenues derived from 20-year evergreen contracts with significant termination provisions. Attractive
Slide 5: A Dynamic Alternative Asset Manager Focused Solely on Real Estate
5 Private Clients A Dynamic Alternative Asset Manager Focused Solely on Real Estate Over $41 Billion in AUM RMR Platform Approximately 2,000 Properties More than 35 Offices Nationwide Nearly 1,100 Real Estate Professionals National Multi-Sector Investment Platform Industrial Residential Senior Livin
Slide 6: More Than 35 Years of Institutional Experience in Commercial Real Estate
6 More Than 35 Years of Institutional Experience in Buying, Selling, Financing and Operating Commercial Real Estate - 5 10 15 20 25 30 35 40 45 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2
Slide 7: Vertically Integrated Platform
7 Vertically Integrated Platform Accounting Marketing Human Resources Investor Relations Property Management Development Finance Legal Information Technology Project Management Tax Portfolio Management Transactions Asset Management Key Differentiators • Deep Bench of Experienced Professionals: Marke
Slide 8: Perpetual and Private Capital Assets Under Management Across Diverse Sectors
8 $26B $27B $28B $30B $33B $32B $33B $37B $36B $41B 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 FQ3 Perpetual Capital Private Capital Perpetual and Private Capital Assets Under Management Across a Diverse Mix of Commercial Real Estate Sectors AUM by Sector Diversified across all major CRE sect
Slide 9: AUM by Client Type
9 AUM by Client Type Vertically integrated platform focused on multifamily properties across the Sunbelt. $5.3B Industrial Real Estate Funds Portfolio of “Core Plus” industrial real estate. $3.9B Medical Office & Life Science Real Estate Funds Portfolio of “Core Plus” medical office and life science
Slide 10: RMR's Significant Contractual Relationships
10 RMR earns fees pursuant to Business Management and Property Management Agreements that renew each year for successive 20-year terms. • Business management revenues principally consist of monthly fees generally based on 50 bps per annum multiplied by the lower of: (1) the historical cost of real e
Slide 11: Track Record of Attractive Cash Flows and Well Covered Dividend
11 $92M $100M $107M $120M $108M $91M $93M $106M $102M $69M 55% 57% 57% 59% 57% 51% 51% 51% 51% 45% -40% -30% -20% -10% 0% 10% 20% 30% 40% 50% 60% $0 $20 $40 $60 $80 $100 $120 $140 $160 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 YTD Adjusted EBITDA Adjusted EBITDA Margin Track Record of Attrac
Slide 12: Positioned for Growth
12 Positioned for Growth 12
Slide 13: Multiple Levers to Drive Growth
13 Multiple Levers to Drive Growth • Diverse client platform allows RMR to capitalize on strategic opportunities across sectors and navigate real estate cycles. • Significant opportunity to grow base business management fee (~$60 million) and incentive fees (2016 – 2019 annual average of ~$100 milli
Slide 14: Significant Upside Potential as Managed Equity REIT Share Prices Recover
14 Significant Upside Potential as Managed Equity REIT Share Prices Recover 1Illustrates the approximate incremental impact on RMR’s annualized revenue resulting from a $1 increase in share price and the base management fee RMR earns on average market capitalization. $0.2M $0.3M $0.8M $1.2M OPI ILPT
Slide 15: Favorable Industry Trend of Reallocating Capital Towards Private Alternatives
15 Positioned to Capitalize on Favorable Industry Trend of Investors Reallocating Capital Towards Private Alternative Investments Source: Nuveen 2024 Global Institutional Investor Survey. Favorable Demand Drivers Expanding Role of Alternative Asset Classes Interest Rate Stabilization Retail Market E
Slide 16: Gaining Traction on Private Capital Growth Initiatives
16 Gaining Traction on Private Capital Growth Initiatives 16 Location Revere, MA Wayne, PA Size $40.0 million $27.0 million Term Two-year initial term; Three 12-month extension options Three-year initial term; Two 12-month extension options Collateral Hotel Industrial Interest Rate SOFR + 3.95% SOFR
Slide 17: Key Takeaways
17 • Long term financial and operational alignment with clients. • Durable cash flows with attractive operating leverage as platform continues to scale. • Opportunity to cross sell private capital relationships. • Well-positioned to expand across equity and debt vehicles. Key Takeaways • $41 billion
Slide 18: Appendix
18 Appendix
Slide 19: Governed by a Highly Skilled Board of Directors
19 Governed by a Highly Skilled Board of Directors Ann Logan Independent Director Rosen Plevneliev Lead Independent Director Walter C. Watkins, Jr. Independent Director Jonathan Veitch Independent Director Adam Portnoy Managing Director Jennifer Clark Managing Director 50% Female and Members of Unde
Slide 20: Demonstrated Commitment to Sustainability
20 Demonstrated Commitment to Sustainability 1Certifications as of December 31, 2023. • Zero Emissions Promise by 2050 for all RMR managed properties. – Reduce GHG emissions 50% by 2029 from 2019 baseline. – Achieve net zero emissions from operations by 2050. • Water and Waste Goals compared to 2019
Slide 21: Annual Sustainability Report 2023
21 Annual Sustainability Report 2023 Annual Sustainability Report To access sustainability reports, visit RMR’s website at www.rmrgroup.com/corporate-sustainability
Slide 22: Financials
>| | Financials
Slide 23: GAAP Results: Condensed Consolidated Statements of Income
23 GAAP Results: Condensed Consolidated Statements of Income Substantially all revenues are earned from related parties.
Slide 24: Condensed Consolidated Balance Sheets
24 Condensed Consolidated Balance Sheets
Slide 25: Definitions
25 Definitions
Slide 26: Definitions
26 Definitions • Assets Under Management (AUM) All references in this presentation to AUM on, or as of, a date are calculated at a point in time. • AUM is calculated as: (i) the historical cost of real estate and related assets, excluding depreciation, amortization, impairment charges or other non-c
Slide 27: Definitions (Continued)
27 Definitions (Continued) Non-GAAP Measures: RMR presents certain “non-GAAP financial measures” within the meaning of the applicable rules of the SEC, including EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin. The GAAP financial measure that is most directly comparable to EBITDA and Adjusted EBI
Slide 28: Two Newton Place, Newton, MA
28 Investor Presentation September 2024 Two Newton Place 255 Washington Street, Suite 300 Newton, MA 02458 RMRGROUP.COM