Allied Properties Real Estate Investment Trust · TSX:AP.UN
Allied Properties Real Estate Investment Trust — Investor Presentation (May 2021)
77 slides from Allied Properties Real Estate Investment Trust's investor presentation, May 2021
Slide 1: Creativity & Connectivity
CREATIVITY & CONNECTIVITY May 2021
Slide 2: Forward-looking information
This presentation may contain forward-looking information about future events or Allied’s future performance. This information, by its nature, is subject to risks and uncertainties that may cause actual events or results to differ materially, including those described under the heading “Risks and Un
Slide 3: Table of Contents
TABLE OF CONTENTS Investment Highlights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Rental Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Development
Slide 4: Investment Highlights
INVESTMENT HIGHLIGHTS – At the forefront of urban intensification in Canada’s major cities – Fully internalized and entrepreneurial management team – Strong growth platform – Strong financial foundation – 27.2% compound annual growth rate on total assets – 14.7% average annual total return 4
Slide 5: Portfolio Growth - Total Assets
PORTFOLIO GROWTH - TOTAL ASSETS (M) 128M 9,665 9,410 8,324 IPO 6,706 9.7B 5,824 5,214 4,456 3,933 Q1 2021 3,501 3,052 2,155 27.2% 1,583 1,155 949 809 385 503 157 267 128 CAGR IPO 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Q1 2021 Values up to December 3
Slide 6: Focused on Increasing Distribution and Growing NAV per Unit
FOCUSED ON INCREASING OUR DISTRIBUTION AND GROWING OUR NAV PER UNIT OVER TIME ANNUALIZED DISTRIBUTION PER UNIT NAV PER UNIT Annual Distribution Per Unit NAV per Unit $1.70 $1.70 $60.00 $1.65 $1.60 $1.60 $48.54 $48.72 $50.00 $1.56 $1.53 $1.50 $1.50 $46.55 $1.46 $42.12 $40.00 $1.41 $38.19 $1.40 $35.66
Slide 7: Returns to Unitholders
RETURNS TO UNITHOLDERS TOTAL RETURN INDEX 14.7% $1,700 Allied Properties S&P / TSX Total Retur ns Index S&P / TSX Capped REIT Index $1,600 $1,500 $1,400 AVERAGE ANNUAL $1,300 TOTAL RETURN $1,200 $1,100 $1,000 $900 $800 $700 $600 $500 $400 $300 $200 $100 $0 2003 2004 2005 2006 2007 2008 2009 2010 201
Slide 8: NOI by Space Type
FOCUSED ON OPERATING DISTINCTIVE URBAN WORKSPACES AND URBAN DATA CENTRES: NOI BY SPACE TYPE (IN $M) Office UDC Retail Parking OFFICE UDC RETAIL PARKING $10.8 $350,000 $350 $13.1 $29.2 $25.0 $15.1 $57.7 $300,000 $300 $55.9 $22.9 $12.9 $53.4 $12.2 $21.6 $250,000 $250 $252.7 $248.6 $11.1 $18.3 $49.1 $9
Slide 9: Strategy
ALLIED Strategy
Slide 10: Consolidation of Urban Office Properties
CONSOLIDATION OF URBAN OFFICE PROPERTIES – Close to core – Distinctive – Lower occupancy costs 10
Slide 11: 500-522 King West, Toronto
500-522 King West Toronto 11
Slide 12: The Landing, Vancouver
The Landing Vancouver 12
Slide 13: 35-39 Front Street East, Toronto
35-39 Front Street East Toronto 13
Slide 14: 14
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Slide 15: 15
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Slide 16: 16
16
Slide 17: 17
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Slide 18: Intensification of Urban Office Properties
INTENSIFICATION OF URBAN OFFICE PROPERTIES – Underutilized land – Additional rentable area with low land cost – Value creation 18
Slide 19: Intensification of QRC West
Intensification of QRC West Toronto 19
Slide 20: Intensification of QRC West
Intensification of QRC West Toronto 20
Slide 21: Intensification of The Breithaupt Block
Intensification of The Breithaupt Block Kitchener 21
Slide 22: King Portland Centre
King Portland Centre Toronto 22
Slide 23: Rental Portfolio
ALLIED Rental Portfolio
Slide 24: Summary of Rental Properties
SUMMARY OF RENTAL PROPERTIES TOTAL RENTAL PORTFOLIO GLA 192 Rental Properties valued at $7.9B 13.9M SF (Not including 10 Properties Under Development valued at $1.0B) TORONTO CENTRAL REGION VANCOUVER WESTERN REGION 4.7M SF 643K INCLUDING URBAN DATA CENTRES SF 510K SF LEASED 91.4% LEASED 95.6% MARKET
Slide 25: Montréal Portfolio
MONTRÉAL PORTFOLIO Mile-Ex BE RN AR T. S D AV L E. AU PA RE RK NT AV N BL E. V ST D. UR . ST BA .D IN Mile End EN ST IS . ST HE . R N RU LA IJ UR U ES IER LIE AV AIN N E. ST BO E AV SA T- U .A IN E. RÉ LE T- C MB VA AN ST OU M TO RD I RO R JA IN CE AT VI CQ E ISE LL ST L W Central LE UE E- .W AT ST
Slide 26: Toronto Portfolio
TORONTO PORTFOLIO COLLEGE ST. REIT JOINT VENTURE N DUFFERIN ST. ANCILLARY PARKING Little Italy DUNDAS ST. W. BAY ST. UNIVERSITY AVE. SPADINA AVE. CHURCH ST. SHERBOURNE ST. PARLIAMENT ST. JARVIS ST. QUEEN ST. W. STRACHAN AVE. RICHMOND ST. W. RICHMOND ST. E. Corktown YONGE ST. ADELAIDE ST. W. BATHURST
Slide 27: Calgary Portfolio
CALGARY PORTFOLIO CENTRE ST. S Downtown 4 AVE SW 5 AVE SW 6 AVE SW Central 7 AVE SW Business District N 8 AVE SW Stephen Ave. 9 AVE SW 10 AVE. SW 11 AVE. SW 12 AVE. SW SE 3 ST. SE OLYMPIC WAY SE 13 AVE. SW E. 2 ST. SW 4 ST. SW 8 ST. SW 1 ST. SW 5 ST. SW AV 1 ST. SE Beltline Inglewood 12 9A 17 AVE. S
Slide 28: Vancouver Portfolio
W G Y H 99 BE JE TO AC RV N H ST IS . PA AV ST CI . E. FI C BU TE ST . ST . TH BU U RR RL O AR W D D RA ST ST . . KE ST . D AV H IE EL ST M CK . E N ST RI . CH AR N H H D O S EL AM M ST SO IL ER . M N TO ST AI N ST N ST . . G LA RA N . N D VI ST LL . E ST . Yaletown RO CA BS M O N BI E ST BE . W AT
Slide 29: Urban Workspace Top-Ten Properties
URBAN WORKSPACE TOP-TEN PROPERTIES NORMALIZED APPRAISED PROPERTY NAME LQA NOI FAIR VALUE CAP RATE PRINCIPAL USERS CITÉ MULTIMÉDIA, MONTRÉAL $20,866 $420,990 4.75% Desjardins, Morgan Stanley, SAP Canada 700 DE LA GAUCHETIÈRE, MONTRÉAL 17,265 366,670 5.25% AON Canada Inc, Autorité Régionale de Transpo
Slide 30: Network-Dense Urban Data Centres
NETWORK-DENSE URBAN DATA CENTRES NORMALIZED APPRAISED PROPERTY NAME LQA NOI FAIR VALUE CAP RATE PRINCIPAL USERS 151 FRONT W, TORONTO $39,542 $598,290 5.00% Bell, Cologix, Equinix 250 FRONT W, TORONTO 15,634 341,430 5.75% AWS, Cloud Service Provider 905 KING W, TORONTO 4,528 101,470 5.75% Beanfield,
Slide 31: Connectivity
CONNECTIVITY Source: PeeringDB.com 31
Slide 32: Urban Data Centres: Critical Component of Canada's Communications Infrastructure
OUR URBAN DATA CENTRES ARE A CRITICAL COMPONENT OF CANADA’S COMMUNICATIONS INFRASTRUCTURE Our Urban Data Centres are a critical component of Canada's communications infrastructure UDC NOI Excluding Ancillary Revenue UDC NOI from Ancillary Revenue Year-Over-Year Traffic Trending (Gbps) 65.0 1,250 59.
Slide 33: NOI by Segment, NOI by Use
NOI BY SEGMENT NOI BY USE 16.5% 16.5% NOI BY SEGMENT NOI BY USE URBAN DATA CENTRES URBAN DATA CENTRES 40.7% TORONTO 10.9% AND CALGARY, 8.3% KITCHENER EDMONTON RETAIL AND VANCOUVER 3.1% PARKING 31.9% Urban Data Centres Calgary, Edmonton and Vancouver Montréal and Ottawa Toronto and Kitchener Urban Da
Slide 34: Lease Maturities - Urban Workspace
LEASE MATURITIES - URBAN WORKSPACE % OF TOTAL GLA W/A RENTAL RATE ESTIMATED CURRENT W/A MARKET RATE 25.0% $35.00 $30.00 20.0% $25.93 $24.17 $25.00 $25.31 $22.67 $22.48 $22.19 $23.17 15.0% $21.99 $19.75 $20.00 $18.62 12.2% 10.2% $15.00 10.0% 8.6% 7.6% $10.00 5.9% 5.0% $5.00 0.0% $0.00 December 31, 20
Slide 35: Lease Maturities - Montréal and Ottawa
LEASE MATURITIES - URBAN WORKSPACE MONTRÉAL AND OTTAWA % OF SEGMENT GLA W/A IN-PLACE RENTAL RATE ESTIMATED CURRENT W/A MARKET RATE 25.0% $35.00 $30.00 20.0% $25.00 15.0% $18.24 $20.00 $18.41 $17.61 $17.51 $17.21 $17.59 $17.30 $16.92 $16.84 $16.91 $15.00 10.0% 9.0% 8.3% $10.00 6.3% 5.2% 5.0% 3.1% $5.
Slide 36: Lease Maturities - Toronto and Kitchener
LEASE MATURITIES - URBAN WORKSPACE TORONTO AND KITCHENER % OF SEGMENT GLA W/A IN-PLACE RENTAL RATE ESTIMATED CURRENT W/A MARKET RATE 25.0% $40.00 $35.00 20.0% $30.64 $29.92 $29.59 $28.83 $30.00 $26.63 $28.57 15.7% $25.00 15.0% $25.61 $25.50 $21.47 13.2% $19.57 12.2% $20.00 10.0% 8.8% $15.00 7.4% $10
Slide 37: Lease Maturities - Calgary, Edmonton and Vancouver
LEASE MATURITIES - URBAN WORKSPACE CALGARY, EDMONTON AND VANCOUVER 25.0% $30.00 % OF SEGMENT GLA W/A IN-PLACE RENTAL RATE ESTIMATED CURRENT W/A MARKET RATE $26.93 $26.79 $25.00 $25.51 20.0% $22.37 $20.46 $22.08 $21.38 $20.81 $20.00 $19.83 16.5% 15.0% 14.5% 11.8% $15.00 10.0% $12.59 9.0% $10.00 5.7%
Slide 38: Lease Maturities - Urban Data Centres
LEASE MATURITIES - URBAN DATA CENTRES % OF SEGMENT GLA W/A IN-PLACE RENTAL RATE ESTIMATED CURRENT W/A MARKET RATE 25.0% $160.00 $134.74 $135.46 $140.00 20.0% $134.58 18.6% $120.00 $107.60 $110.00 $100.96 $106.96 15.0% $100.00 15.0% $96.52 $89.61 $86.54 $80.00 10.6% 10.0% $60.00 $40.00 4.8% 5.0% $20.
Slide 39: Top-Ten Users Q1 2021
TOP-TEN USERS USER SECTOR % RENTAL REVENUE (Q1 2021) 49% CLOUD SERVICE PROVIDER Data Centre/IT 4.5% UBISOFT Gaming/IT 2.6% COLOGIX Data Centre/IT 2.4% 2003 EQUINIX Data Centre/IT 2.2% 19.9% SHOPIFY INC. Commerce/IT 1.5% BELL CANADA Telecommunications 1.5% NATIONAL CAPITAL COMMISSION, Q1 2021 A CANAD
Slide 40: Development Portfolio
ALLIED Development Portfolio
Slide 41: Active Development Pipeline
ACTIVE DEVELOPMENT PIPELINE % OF OFFICE % OF OFFICE DEVELOPMENT DEVELOPMENT 2021 ESTIMATED PRE-LEASED 2023 ESTIMATED PRE-LEASED GLA NOI GLA NOI THE LOUGHEED 88,000 TBD — QRC WEST, PHASE II 90,000 $4.2M — COLLEGE & MANNING* 27,000 $1.1M — KING TORONTO* 100,000 $5.5M — 115,000 $1.1M+ 190,000 $9.7M % O
Slide 42: Future/Shadow Development Pipeline
FUTURE/SHADOW DEVELOPMENT PIPELINE Zoning Approval in Place To Be Rezoned and in Progress ESTIMATED ESTIMATED Toronto GLA GLA UNION CENTRE 1,129,000 TORONTO 5,279,176 KING & PETER 790,000 MONTRÉAL 1,652,207 ADELAIDE & SPADINA 230,000 CALGARY 1,150,921 2,149,000 OTHER 391,482 8,473,786 ESTIMATED Mont
Slide 43: The Lougheed, Calgary
The Lougheed Calgary 43
Slide 44: 400 Atlantic, Montréal
400 Atlantic Montréal 44
Slide 45: Boardwalk-Revillon Building, Edmonton
Boardwalk-Revillon Building Edmonton 45
Slide 46: Breithaupt III, Kitchener
Breithaupt III Kitchener 46
Slide 47: The Well, Toronto
xs nhs q wy Ri had OE =: The Well Toronto 47
Slide 48: Adelaide & Duncan, Toronto
Adelaide & Duncan Toronto 48
Slide 49: QRC West Phase II, Toronto
QRC West Phase II Toronto 49
Slide 50: KING Toronto
ied eee KING Toronto Toronto
Slide 51: King & Brant, Toronto
UTE i” King & Brant Toronto 51
Slide 52: 400 West Georgia, Vancouver
400 West Georgia Vancouver 52
Slide 53: Development Completions
ALLIED Development Completions
Slide 54: QRC West, Toronto
QRC WEST, TORONTO This was a pioneering, large-scale intensification project that involved the integratation of two restored heritage buildings with a new, mid-rise office structure. The project commenced in 2010 and was completed in 2015. It is comprised of 345,274 square feet of GLA and is fully l
Slide 55: The Breithaupt Block, Kitchener
THE BREITHAUPT BLOCK, KITCHENER Allied acquired an undivided 50% interest in the property in 2010 and immediately put it into development, completing the first phase in 2014 and the second phase in mid-2016. The property is an equal two-way joint arrangement between Allied and Perimeter Development
Slide 56: 180 John Street, Toronto
180 JOHN STREET, TORONTO Allied acquired the property in 2015. The property was redeveloped, is compromised of 45,631 square feet of GLA and is fully leased. DEVELOPMENT ECONOMICS INVESTMENT LAND COSTS $8,700 HARD & SOFT COSTS 17,500 VALUE CAPITALIZED INTEREST & STABILIZED UNLEVERED YIELD VALUE CREA
Slide 57: 189 Joseph, Kitchener
189 JOSEPH, KITCHENER 189 Joseph was purchased as part of The Tannery in 2012. The building stood vacant, and was slated to be demolished before Allied proposed the redevelopment and secured Deloitte as the user. The project commenced in late-2015 and was completed mid-2017. It is comprised of 26,46
Slide 58: 425 Viger, Montréal
425 VIGER, MONTRÉAL In 2004, Allied expanded into Montréal with the purchase of 425 Viger. At the time, the property comprised of 200,000 square feet of GLA and was fully leased. In 2007, Allied purchased the adjacent parking lot with the intention of intensifying the combined property once the main
Slide 59: King Portland Centre, Toronto
KING PORTLAND CENTRE, TORONTO In 2012, Allied entered into an equal two-way joint arrangement with RioCan to develop King Portland Centre. Allied and RioCan each acquired an undivided 50% interest in 642 King W and 620 King W and subsequently put them into development, completing 642 King W in early
Slide 60: Risk Management
ALLIED Risk Management
Slide 61: Development Risk Management
DEVELOPMENT – 15% limitation on development – Pre-leasing – Partial monetization – Financial management – Collaboration 61
Slide 62: Balance Sheet
BALANCE SHEET – Low leverage – Long-term, fixed-rate debt – Net debt to EBITDA ratio of 7.9x – Debt ratio 31.1% – Interest coverage ratio of 3.3x The above ratios are calculated as at March 31, 2021, Interest coverage ratio includes capitalized interest and excludes prepayment costs. Debt in “debt r
Slide 63: Financial Covenants
FINANCIAL COVENANTS SENIOR UNSECURED DEBENTURES COVENANT THRESHOLD MARCH 31, 2021 PRO FORMA INTEREST COVERAGE RATIO Maintain a 12-month rolling consolidated 2.9x pro forma EBITDA of at least 1.65 times pro forma interest expense PRO FORMA ASSET COVERAGE TEST Maintain net consolidated debt below 31.0
Slide 64: Debt Maturity Chart
DEBT MATURITY CHART MORTGAGES UNSECURED TERM LOANS UNSECURED DEBENTURES CONSOLIDATED W/A INT RATE Mortgage Debentures Term Loan Consolidated WA Int Rate $700 5.00% 4.70% 4.50% 4.42% 4.24% 4.30% $600 $600.0 4.00% 3.55% 3.50% $500 3.39% 3.50% 3.17% 3.11% 3.08% 3.00% MILLIONS $400 Millions $400.0 2.50%
Slide 65: Unencumbered Assets
UNENCUMBERED ASSETS UNENCUMBERED ASSET POOL % OF ASSET POOL UNENCUMBERED $7,000,000,000 78% 80% 73% $6.9B 72% 68% $6.5B 70% $6,000,000,000 $5.5B 60% $5,000,000,000 52% 47% 50% $4.3B $4 ,000,000,000 39% 40% $3,000,000,000 $2.9B 30% $2.3B $2,000,000,000 21% 20% $1.6B 12% $1,000,000,000 10% $782.0M $40
Slide 66: Maximizing Flexibility While Strengthening the Balance Sheet
MAXIMIZING FLEXIBILTY WHILE STRENGTHENING THE BALANCE SHEET UNENCUMBERED INVESTMENT PROPERTIES TOTAL INVESTMENT PROPERTIES UNSECURED DEBT AS % OF TOTAL DEBT $10.0 100% CREDIT RATINGS $9.0 90% Investment grade $8.8 $8.9 since 2014 $8.0 80% 79% $7.6 72% $7.0 70% $6.9 BBB 65% $6.5 $6.3 $6.0 60% 57% BIL
Slide 67: Environmental, Social & Governance (ESG)
Environmental, Social & Governance (ESG) 67
Slide 68: Environmental, Social & Governance
ENVIRONMENTAL, SOCIAL & GOVERNANCE ENVIRONMENTAL Our impact on the natural world at both corporate and property levels. We aim to protect the natural environment, while reducing our environmental footprint through thoughtful acquisitions, development, and operations. SOCIAL Our relationship with key
Slide 69: Steps to Measure and Improve Performance
STEPS TO MEASURE AND IMPROVE PERFORMANCE ENVIRONMENTAL – On December 17, 2020, Allied obtained a $232.5 million green construction loan for the KING Toronto development which has been used towards achieving a minimum LEED Gold Certification. – On February 3, 2021, Allied announced its Green Financin
Slide 70: Steps to Measure and Improve Performance
STEPS TO MEASURE AND IMPROVE PERFORMANCE GRESB – Submitted to GRESB in 2020 on 2019 performance. – Scored 64 – “Strong First-Year Showing” according to GRESB. – Committed to submit to GRESB annually. ESG REPORTING – Allied released its inaugural ESG report in 2020, using data and analysis from 2019,
Slide 71: Massey Hall Forever
MASSEY HALL FOREVER On December 8, 2020, Massey Hall announced that Allied made a landmark contribution to the Massey Hall revitalization. This transformative support expands the project’s original scope and introduces Canada’s premiere multi-purpose performance facility, Allied Music Centre, home o
Slide 72: WiredScore
ALLIED WiredScore
Slide 73: WiredScore
WIREDSCORE - WiredScore is a company founded on the principle of wanting to improve the technological infrastructure of cities. - WiredScore Certification is a commercial real estate rating system that empowers owners to understand, improve, and promote their buildings’ digital infrastructure. - All
Slide 74: Appendix Definitions
ALLIED Appendix Definitions
Slide 75: Certain Definitions and Non-IFRS Measures
CERTAIN DEFINITIONS AND NON-IFRS MEASURES Certain defined terms used in this investor presentation have the following meaning: “EBITDA” EBITDA is a non-IFRS financial measure and should not be considered as an alternative to net income or net income and comprehensive income, cash flow from operating
Slide 76: Total Debt, Total Return
“TOTAL DEBT” Total debt is a non-IFRS financial measure and does not have any standard meaning prescribed by IFRS. As computed by us, total debt may differ from similar computations reported by other Canadian real estate investment trusts and, accordingly, may not be comparable to similar computatio
Slide 77: alliedreit.com
ALLIED 134 PETER STREET, SUITE 1700 TORONTO, ONTARIO M5V 2H2 T 416.977.9002 F 416.306.8704 alliedreit.com
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