Kennedy-wilson Holdings Inc. · NYSE:KW

Kennedy-wilson — Q3 2022 Earnings Presentation

42 slides from Kennedy-wilson's earnings presentation, November 2022

  1. Slide 1: Kennedy Wilson Q3-2022 Investor Presentation

    Kennedy Wilson Q3-2022 Investor Presentation

  2. Slide 2: Table of Contents

    TABLE OF CONTENTS SECTION 1 Strategic Review Page 2 SECTION 2 Real Estate Portfolio Page 7 SECTION 3 Investment Management Platform Page 13 SECTION 4 ESG Page 15 SECTION 5 Financial Review Page 18 SECTION 6 Western U.S. Markets Page 22 SECTION 7 European Markets Page 27 © KENNEDY WILSON SECTION 8 Ap

  3. Slide 3: Strategic Review

    © KENNEDY WILSON S T R AT EG I C R E V I E W The Clara, Boise, Idaho, U.S.

  4. Slide 4: Q3-22 Highlights

    Q3-22 HIGHLIGHTS $1.4B in Estimated Annual NOI to $473M; +9% YTD Investment Fee-Bearing Capital increased by 6% to $5.6B; +12% YTD Transactions Key Q3 Consolidated: Acquired multifamily asset in Albuquerque, NM, and disposed asset in Real Estate Oakland, CA Acquisitions Co-Invest: Acquired $234M in

  5. Slide 5: Kennedy Wilson at a Glance

    KENNEDY WILSON AT A GLANCE (NYSE: KW) $22B Real Estate AUM1 37,600 27M Multifamily Units2 Commercial Sq Ft3 © KENNEDY WILSON 1) As defined in definitions section in the appendix 2) Includes 405 lease-up units and 4,366 units under development Capital Dock, Dublin, Ireland 3) Includes 1.8m sq ft of l

  6. Slide 6: About Kennedy Wilson

    ABOUT KENNEDY WILSON Kennedy Wilson (NYSE:KW) is a leading global real estate investment company. We own, operate, and invest in real estate through our balance sheet and through our investment management platform across the Western United States, United Kingdom, and Ireland. We primarily focus on m

  7. Slide 7: The Kennedy Wilson Advantage

    THE KENNEDY WILSON ADVANTAGE Globally diversified real estate portfolio in growing markets with complementary investment management platform Long-term relationships with major financial institutions Local expertise to accretively allocate capital First-mover advantage from early entry in key target

  8. Slide 8: Real Estate Portfolio

    © KENNEDY WILSON R EA L E S TAT E P O R T F O L I O Bristol at Southport, Renton, Washington, U.S.

  9. Slide 9: Two Key Investment Segments

    TWO KEY INVESTMENT SEGMENTS Consolidated Portfolio Co-Investment Portfolio Wholly-owned investments with accretive Real estate and loan investments with asset management opportunities strategic partners and commingled fund business (KW ownership 5-50%) $301M 1 $37M $172M $5.6B $55M Estimated Annual

  10. Slide 10: Excellent Scale Across Multifamily and Office

    EXCELLENT SCALE ACROSS MULTIFAMILY AND OFFICE Sectors Geography $473M Multifamily: 56% Office: 29% $473M Western U.S.: 64% Ireland.: 17% Estimated Estimated Annual NOI1 Retail: 7% Annual NOI1 U.K.: 16% Hotel / Loans / Italy & Spain: 3% Industrial: 8% 428 37,571 26.6 95.4% No. of investments No. of C

  11. Slide 11: Suburban Assets Comprise 75% of Multifamily and Office NOI

    SUBURBAN ASSETS COMPRISE 75% OF MULTIFAMILY AND OFFICE NOI Multifamily and Office $402M Suburban: 75% Multifamily: Mission Hills, Camarillo, CA, U.S. Estimated Urban: 25% Annual NOI © KENNEDY WILSON Office: Hamilton Landing, Novato, CA, U.S. Q3-2022 Investor Presentation 10

  12. Slide 12: Development and Leasing Pipeline Expected to Add ~$92M in NOI

    DEVELOPMENT AND LEASING PIPELINE EXPECTED TO ADD ~$92M IN NOI 2023 2024-2025 $23M $69M 38° North Phase II, Santa Rosa, CA Dovetail, Boise, Idaho Kona Village Resort, Kona, Hawaii Pointe by Vintage, Des Moines, WA Oxbow, Bozeman, Montana Coopers Cross, Dublin © KENNEDY WILSON Station by Vintage, Covi

  13. Slide 13: Expected NOI from Completion of Development & Future Leasing

    EXPECTED NOI FROM COMPLETION OF DEVELOPMENT & FUTURE LEASING +$92M of Est. Ann. NOI by 2025 $60 $54 $50 $19 $40 $30 $22 $20 $16 $11 $35 $3 $10 $11 $13 $0 2023 2024 2025 US Europe © KENNEDY WILSON Based on expected stabilization date for development projects . The scope of these projects are subject

  14. Slide 14: Investment Management Platform

    © KENNEDY WILSON I N V E ST M E N T M A N A G E M E N T P L AT F O R M Clancy Quay, Dublin, Ireland

  15. Slide 15: Fee-Bearing Capital Raised from Broad Institutional Investor Base

    FEE-BEARING CAPITAL RAISED FROM BROAD INSTITUTIONAL INVESTOR BASE Investor Type Investor By Geography Investor Type Insurance Geography Company: 50% Canada: 37% $5.6B Sovereign Wealth Fund: 18% $5.6B U.S.: 27% Fee-Bearing Pension Fund: 12% Fee-Bearing Asia: 22% Capital1,2 Capital1 Family Office: 9%

  16. Slide 16: ESG Overview

    © KENNEDY WILSON E S G OV E RV I E W Kona Village Resort, Kona, Hawaii 15

  17. Slide 17: Our ESG Program Focuses on Four Pillars

    OUR ESG PROGRAM FOCUSES ON FOUR PILLARS © KENNEDY WILSON Q3-2022 Investor Presentation

  18. Slide 18: ESG Program at a Glance

    ESG PROGRAM AT A GLANCE © KENNEDY WILSON Please visit esg.kennedywilson.com for more information Q3-2022 Investor Presentation 17

  19. Slide 19: Financial Review

    © KENNEDY WILSON FINANCIAL REVIEW One Embassy Gardens , London, UK

  20. Slide 20: Strong Protection Against Rising Interest Rates

    STRONG PROTECTION AGAINST RISING INTEREST RATES Reduced Floating Rate Exposure Cash and Credit Facility 97% Fixed: 71% Hedged via interest $720M Cash: $420M Fixed or Revolving credit rate cap: 26% Cash and Lines hedged debt facility: $300M (KW Share) Floating: 3% of Credit Credit Profile 4.0% <10% 5

  21. Slide 21: Key Annual Financial Metrics

    KEY ANNUAL FINANCIAL METRICS Adjusted EBITDA1 Adjusted Net Income1 $ in M $ in M $928 $509 $713 $728 $443 $397 $608 $307 $456 $243 2017 18 19 20 21 2017 18 19 20 21 Fee-Bearing Capital1 EPS $ in B $5.0 $2.24 $3.9 $1.58 $3.2 $3.0 $1.04 $0.83 $1.8 $0.66 © KENNEDY WILSON 2017 18 19 20 21 2017 18 19 20

  22. Slide 22: Components of Value

    COMPONENTS OF VALUE Below Are Key Valuation Metrics as of September 30, 2022 Investments Kennedy Wilson’s Share ($ in millions) Income Producing Assets Description Est. Annual NOI(1)(2) 1 Multifamily 32,800 units $266.4 2 Office 10.1 million sq ft 135.6 3 Industrial 10.2 million sq ft 11.6 4 Retail

  23. Slide 23: Western U.S. Markets

    © KENNEDY WILSON WESTERN U.S. MARKETS Prosper Place, Denver, Colorado, U.S.

  24. Slide 24: U.S. Stabilized Portfolio

    U.S. STABILIZED PORTFOLIO $237m $302M $302M Estimated Estimated Annual NOI1 Annual NOI1 Sectors Sectors Multifamily: 79% Mountain West: 36% Office: 15% Pacific Northwest: 33% Loans: 4% Southern California: 18% Retail / Industrial: 2% Northern California: 13% © KENNEDY WILSON 1) As defined in definit

  25. Slide 25: Mountain West Portfolio by State

    MOUNTAIN WEST PORTFOLIO BY STATE As of Q3-22 Other2 9% Colorado 12% Idaho New Mexico 13% $110M 24% Alpine Meadows, Sandy, UT Estimated Annual NOI1 Utah 19% Nevada 23% © KENNEDY WILSON Whitewater Park, Boise, ID 1 ) As defined in definitions section in the appendix 2 ) Includes Montana and Arizona Q3

  26. Slide 26: Mountain West Represents Largest Apartment Region

    MOUNTAIN WEST REPRESENTS LARGEST APARTMENT REGION 264% Growth in Since Q3-18 Q3-18 Q3-22 264% Est. Ann. NOI1 $28M $102M Multifamily units 162% (stabilized) 4,819 12,615 Multifamily units (under development) 648 1,150 © KENNEDY WILSON 1 ) As defined in definitions section in the appendix Q3-2022 Inve

  27. Slide 27: Vintage Housing: Growing Our Affordable Housing Portfolio

    VINTAGE HOUSING: GROWING OUR AFFORDABLE HOUSING PORTFOLIO 23% Growth Expected in Stabilized Units by YE-24 Vintage at Urban Center, Lynwood, WA, U.S. Southside by Vintage, Seattle, WA, U.S. Steamboat by Vintage, Reno, NV, U.S. At acquisition (Q2-15) Q3-22 Q4-241 Communities (stabilized) 30 44 54 Sta

  28. Slide 28: European Markets

    © KENNEDY WILSON E U R O P EA N M A R K E T S Coopers Cross, Dublin, Ireland

  29. Slide 29: Europe Stabilized Portfolio

    EUROPE STABILIZED PORTFOLIO $171M $171M Estimated Estimated Annual NOI1 Annual NOI1 Sectors Geography Office: 54% Ireland: 47% Retail: 16% United Kingdom: 45% Multifamily: 16% Italy: 5% Hotel: 7% Spain: 3% Industrial/Loans: 7% © KENNEDY WILSON 1) As defined in definitions section in the appendix Q3-

  30. Slide 30: Irish Multifamily: Market Imbalance Creates Opportunity

    IRISH MULTIFAMILY: MARKET IMBALANCE CREATES OPPORTUNITY Low institutional Urgent need for new Fewer apartment dwellers ownership residential stock than other EU countries 342,612 34,000 46.2% Private rental units Annual residential % of apartment dwellers in Ireland1 requirement3 in EU countries5 <5

  31. Slide 31: Ireland: KW's Dominant Presence in Dublin

    IRELAND: KW’S DOMINANT PRESENCE IN DUBLIN 1 Capital Dock 2 Alliance Hanover Quay Liffey Trust 1 3 12 8 Northbank 2 4 3 4 State Street 5 11 Alto Vetro 6 5 9 6 10 7 Coopers Cross 8 7 9 10 11 12 © KENNEDY WILSON KW owned buildings Q3-2022 Investor Presentation 30

  32. Slide 32: Ireland: Resilient Growth Market Opportunity

    IRELAND: RESILIENT GROWTH MARKET OPPORTUNITY Economic & Market Overview One of the most defensive Destination for the world’s fastest global economies growing industries5 +6.4% GDP growth forecasted in 20221 Global leader in innovation 1st Top 20 World ranking for Ecological World ranking Sustainabi

  33. Slide 33: Strong Office Fundamentals and Favorable UK & Irish Lease Structures

    STRONG OFFICE FUNDAMENTALS AND FAVORABLE UK & IRISH LEASE STRUCTURES UK & Irish leases KW UK & Ireland office portfolio1 Long-term with 5-year rent reviews 27% 95% Upward-only FRI leases rent reviews or fixed uplifts Upward-only rent reviews in UK (and pre-2010 in Ireland) 8.5yrs 5.8yrs WAULT WAULT

  34. Slide 34: Robust European Office Fundamentals Driving Future Growth

    ROBUST EUROPEAN OFFICE FUNDAMENTALS DRIVING FUTURE GROWTH Key European Office Markets For KW Watford Harlow M25 M25 Reading Windsor London Hook Farnborough Dublin London Q3-22 South East Q3-22 Dublin Q3-22 Prime rents (£ psf) 135.00 Prime rents (£ psf) 42.00 Prime rents (€ psf) 62.50 Take-up (m sq f

  35. Slide 35: Appendix

    © KENNEDY WILSON APPENDIX One Embassy Gardens , London, UK

  36. Slide 36: Multifamily Portfolio: $266M of Estimated Annual NOI

    MULTIFAMILY PORTFOLIO: $266M OF ESTIMATED ANNUAL NOI 1 Seattle WA MT Portland OR Reno ID Boise NV San Francisco UT Salt Lake City CA Dublin Bay Area Las Vegas AZ Los Angeles Cork U.S. Ireland $238.6M Assets Units $27.8M Assets Units Est. Ann. NOI1 1152 30,2562 Est. Ann. NOI1 113 2,5443 Mountain West

  37. Slide 37: Office Portfolio: $136M of Estimated Annual NOI

    OFFICE PORTFOLIO: $136M OF ESTIMATED ANNUAL NOI 1 Seattle WA Milan MT OR ID Rome WY NV UT San Francisco CO CA Denver Bay Area Dublin AZ Los Angeles London U.S. Europe $44.0M Assets Area (sq ft) $91.6M Assets Area (sq ft) Est. Ann. NOI1 212 6.2M2 Est. Ann. NOI1 283 3.9M3 Pacific Northwest Southern Ca

  38. Slide 38: KW Top Assets

    KW TOP 20 ASSETS Accounts KW share Commercial Units Acquisition Asset name for 35% of Location Estimated Annual Region NOI Sector of NOI2 (000 sq ft) /rooms date 1 111 BPR London UK Office 15.5 216 - Nov-14 2 90 East Issaquah, WA Pacific Northwest Office 15.4 587 - Jun-17 3 Bella Vista Richmond, CA

  39. Slide 39: Reconciliation of Net Income to Adjusted EBITDA

    RECONCILIATION OF NET INCOME ATTRIBUTABLE TO KWH COMMON SHAREHOLDERS TO ADJUSTED EBITDA ($ in M) Q3-22 2021 2020 2019 2018 Net income attributable to Kennedy-Wilson Holdings, Inc. common shareholders $16.4 $313.2 $92.9 $224.1 $150.0 Non-GAAP adjustments: Add back (Kennedy Wilson’s Share): Interest e

  40. Slide 40: Reconciliation of Net Income to Adjusted Net Income

    RECONCILIATION OF NET INCOME ATTRIBUTABLE TO KWH COMMON SHAREHOLDERS TO ADJUSTED NET INCOME ($ in M) Q3-22 2021 2020 2019 2018 Net income attributable to Kennedy-Wilson Holdings, Inc. common shareholders $16.4 $313.2 $92.9 $224.1 $150.0 Non-GAAP adjustments: Add back (less): Depreciation and amortiz

  41. Slide 41: Estimated Annual NOI Reconciliation

    ESTIMATED ANNUAL NOI RECONCILIATION ($ in M) Q3-22 Rental Revenues $110.9 Hotel Revenues 14.0 Rental (Expenses) (38.6) Hotel (Expenses) (8.6) Loans and other 3.0 Consolidated NOI $80.7 Adjustments: Non-controlling interest (1.9) NOI from Unconsolidated investments (KW Share) 39.7 Property-Level NOI

  42. Slide 42: Appendix: Definitions

    APPENDIX DEFINITIONS: Adjusted EBITDA: represents net income before interest expense, loss on early extinguishment of debt, our share of interest expense included in unconsolidated investments, depreciation and amortization, our share of depreciation and amortization included in unconsolidated inves

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