Kimco Realty Corporation (hc) · NYSE:KIM
Kimco Realty Corporation (hc) — Kimco Realty — Investor Day (December 2013)
135 slides from Kimco Realty Corporation (hc)'s investor day presentation, December 2013
Slide 1: Kimco Realty Investor Day 2013
Kimco Realty Investor Day 2013
Slide 2: Agenda
KIMCO INVESTOR DAY 2013 Agenda Introduction 1:00 - 1:10pm Milton Cooper, Executive Chairman Kimco Strategy & Direction 1:10 - 1:25pm Dave Henry, Vice Chairman, President and CEO Shopping Center Portfolio Strategy 1:25 - 2:10pm Conor Flynn, EVP and COO Acquisition & Disposition Strategy 2:10 - 2:25pm
Slide 3: Safe Harbor
SAFE HARBOR The statements in this presentation, including targets and assumptions, state the Company’s and management’s hopes, intentions, beliefs, expectations or projections of the future and are forward-looking statements. It is important to note that the Company’s actual results could differ ma
Slide 4: Milton Cooper
Union Crescent Plaza | Union, NJ Milton Cooper Executive Chairman 4
Slide 5: David Henry
Sunset Valley Marketfair | Austin,TX David Henry President and CEO 5
Slide 6: Company Snapshot
COMPANY SNAPSHOT Largest Owner and Operator of Premier Shopping Centers in North America History Started in 1958 | IPO that initiated Modern REIT Era NYSE listed (1991) | S&P 500 Index (2006) Dividend $0.90(1) annually, ~4.4% yield at 11/29/13 Retail Portfolio 841 properties totaling 123M sf Footpri
Slide 7: Total Return Analysis
TOTAL RETURN ANALYSIS Total Return % 13.0% 11.5% 11.9% 11.0% 11.2% 6.1% 1 Year 3 Year Since IPO KIM NAREIT Equity REIT Index Source: Bloomberg Historical Total Returns Exceed Equity REIT Index 7
Slide 8: Kimco Characteristics
KIMCO CHARACTERISTICS Great Great Properties People • 41% of U.S. properties are located in • Successful entrepreneurial culture the top 10 MSAs for over 50+ years • Highly diversified portfolio • Talented and experienced operating ‒ Across 42 States and 7 Canadian team provinces ‒ 28 years average
Slide 9: Key Messages
KEY MESSAGES Kimco Has Executed on the “Back to Basics” Strategy • Vastly improved the quality of our portfolio • Monetized approximately $1B of Latin American assets • Essentially exited all non-retail investments • U.S. occupancy reaching 94% • Grew pro-rata NOI to approximately $1B • Improved bal
Slide 10: We Have Executed
WE HAVE EXECUTED Commitment: Focus on Retail 2008 2013 2014 Where We Were Where We Are Where We Are Going 17% Non-retail Non-retail 83% 98% 100% (1) (1) Projection based on materiality and subject to market conditions By 2014, All Recurring Earnings Contributions Coming from Retail 10
Slide 11: The Case for Retail Real Estate: Today's Market
THE CASE FOR RETAIL REAL ESTATE: TODAY’S MARKET Supply Remains Historically Low… Strip Center Supply Growth (GLA) 12% 10% 8% 6% 4% 2% 0% Source: Green Street Advisors 11
Slide 12: The Case for Retail Real Estate: Today's Market
THE CASE FOR RETAIL REAL ESTATE: TODAY’S MARKET …And Retailers Continue to Expand Retailer Planned Store Openings Yearly Average 84,000 81,000 78,000 75,000 72,000 69,000 66,000 63,000 2009 2010 2011 2012 2013 YTD • More than 81,000 store openings scheduled over the next two years(1) • U.S. retail m
Slide 13: Kimco Portfolio: Diversified by Tenant (ABR)
KIMCO PORTFOLIO: DIVERSIFIED BY TENANT (ABR) 3.0% • ~13,600 leases with 7,100 tenants 2.9% “A” Rated • Well-staggered lease maturity 2.4 % with limited rollover in any 1.8% given year; averages ~8% over next 10 years 1.7% 1.6% Strong credit tenant base • Top 20 publicly traded tenants 1.5% average Y
Slide 14: Retailer Base: Minimal Exposure to Internet
RETAILER BASE: MINIMAL EXPOSURE TO INTERNET Portfolio Composition by ABR 92% Internet Resistant 8% Necessity-based, Internet Discount Goods Vulnerable & Services Books & Video Office Supplies Electronics Diversified Portfolio: Strong Retailers with a Developed Omni-channel Presence 14
Slide 15: Diversified by Geography
DI VERSIFIED BY GEOGRAPHY: 42 STATES AND 7 CANADIAN PROVINCES State Properties SF(M) ABR California 107 18.4 13.5% Florida 71 10.2 8.9% New York 61 6.5 8.3% Texas 50 7.3 4.8% Pennsylvania 40 4.9 4.6% New Jersey 27 4.1 4.2% All Other U.S. 369 49.0 37.1% Puerto Rico 7 2.2 3.2% Canada 67 12.7 10.1% Sub
Slide 16: Three Years of Transformation...What's Next?
THREE YEARS OF TRANSFORMATION…WHAT’S NEXT? Kimco is Committed to Total Shareholder Return Plus by: Transforming Simplifying Our Portfolio = Our Business Great Assets in Model Great Locations Redeveloping & Creating Value Via Leveraging Opportunistic Operational Retail Activities; Excellence THE “PLU
Slide 17: Kimco Strategy
KIMCO STRATEGY • Acquiring high quality assets ‒ 73 U.S. shopping centers acquired for $1.8B since 2010 Investor Day ‒ Concentrate on key markets where Kimco has Transforming scale, physical presence, long standing relationships Our Portfolio = and properties which possess strong demographics Great
Slide 18: Kimco Strategy
KIMCO STRATEGY • Reducing JV platform; buying partner interests accretively ‒ Acquired 12 JV properties for ~$541M ‒ Reduced the number of JV properties from Simplifying 551 to 419 since 2010 Our Business Continue to • Maintaining a strong balance sheet with an Model the Simplify investment grade cr
Slide 19: Update on Latin America Asset Sales
KIMCO STRATEGY: UPDATE ON LATIN AMERICA ASSET SALES • What’s sold ‒ 26 shopping centers and 84 industrial properties in Latin America for a gross price of $1.08B ‒ Kimco share of proceeds: $348M Simplifying • What’s left: Net investment of $450M Our Business Model ‒ 5 properties in South America --
Slide 20: Kimco Strategy: Grow NAV & Earnings
KIMCO STRATEGY: GROW NAV & EARNINGS • Continue to increase occupancy • Growing redevelopment pipeline to $816M • Small shop lease-up Redeveloping & • Embedded organic NOI growth (rent steps, Leveraging below market leases) Operational Excellence • Opportunistic/accretive acquisitions • Continue to r
Slide 21: Kimco Strategy
KIMCO STRATEGY • 50 years of relationships with retailers and experience when opportunities arise • Work directly with retailers on: Creating Value Via ‒ Sale leasebacks Opportunistic Retail Activities; ‒ Bankruptcy expertise THE “PLUS” ‒ Repositioning underperforming retail locations ‒ Retail real
Slide 22: Kimco Is Poised to Deliver Additional Value
KIMCO IS POISED TO DELIVER ADDITIONAL VALUE… • Aggressively transforming & simplifying portfolio more focused footprint of high quality assets • Limited new retail supply plus strong retailer demand for space • Significant value creation opportunities through: ‒ Expanding redevelopment pipeline ‒
Slide 23: Conor Flynn
Westlake S.C. | Daly City, CA Conor Flynn EVP and COO 23
Slide 24: Update Since Assuming COO Role
UPDATE SINCE ASSUMING COO ROLE • Previously served as President of Western Region • Assumed COO position in May 2013 • Deep dive into the portfolio with a focus on growth • Site visits; visited > 80% of portfolio • Improved cross-regional communication: leverage, size, scale and experience • Develop
Slide 25: Experienced, Deep Operational Team
EXPERIENCED, DEEP OPERATIONAL TEAM National Presence, Operating Locally Tom Simmons, President Kelly Smith, Managing Dir. Eastern Region Canada 251 Properties 67 Properties GLA: 27.8M sf GLA: 12.7M sf Occupancy: 96.2% Occupancy: 95.8% Armand Vasquez, President Western Region 188 Properties GLA: 31.3
Slide 26: U.S. Recycling Results
U.S. RECYCLING RESULTS Transformation of the Portfolio: Shifting Toward High Growth Markets (1) 2010 2013 Progress Number of Properties 810 732 Gross GLA (000’s) 111,703 102,571 Portfolio Metrics Pro-rata Occupancy 92.3% 94.5% 220 bps Pro-rata ABR/sf $11.62 $12.95 11.4% Demographics Average HHI $79,
Slide 27: U.S. Key Territories: Focused on Demographics
U.S. KEY TERRITORIES: FOCUSED ON DEMOGRAPHICS GLA 1.3M sf GLA 1.2M sf GLA 3.1M sf GLA 1.0M sf ABR $14.0M ABR $15.8M ABR $29.9M ABR $9.5M Tot. Pop. 2.6M Tot. Pop. 3.3M Tot. Pop. 9.5M Tot. Pop. 2.4M WA GLA 4.9M sf ABR $66.5M MN Tot. Pop. 7.0M OR NY GLA 5.3M sf PA GLA 10.9M sf ABR $86.7M ABR $187.5M To
Slide 28: How We Look at Our Portfolio: Operating Metrics
HOW WE LOOK AT OUR PORTFOLIO: OPERATING METRICS Site Total Occupancy Rent/ Total NOI Count GLA % SF % Tier I Properties 533 51.5M 95.2% $14.05 70% Tier II Properties 108 11.9M 96.6% $9.71 12% Sale Candidates 91 8.1M 87.6% $10.60 7% U.S. Subtotal 732 71.5M 94.5% $12.95 89% Canada 67 7.0M 95.3% $15.59
Slide 29: How We Look at Our Portfolio: Demographics
HOW WE LOOK AT OUR PORTFOLIO: DEMOGRAPHICS Household Median Average Population Density HHI HHI Tier I Properties 1,570 77,366 90,978 120,485 Tier II Properties 942 51,484 63,930 64,244 Sale Candidates 1,083 58,810 70,252 76,758 U.S. Subtotal 1,443 72,288 85,552 109,147 Canada 1,635 63,337 89,995 115
Slide 30: Portfolio Dissection
PORTFOLIO DISSECTION Kimco Portfolio Metrics Compare Favorably to Peers U.S. KIM KIM Peer Shopping U.S. Tier I Avg.(1) Center Portfolio Portfolio Average(2) Average Population 109K 120K 101K 97K Median Household Income 72K 77K 67K 67K Average Gross Occupancy 94.6% 95.2% 94.5% 89.9% Pro-rata ABR/sf $
Slide 31: ABR Dissection
ABR DISSECTION • Insight #I: Ground Lease Population Reduces Average ABR • Insight #2: Vintage Lease Population Reduces Average ABR • Insight #3: Ratio of Anchor to Non-Anchor GLA Reduces Average ABR % of GLA % of ABR Rent/ SF 2013 Total Population 100% 100% $12.95 Impact of: Ground Leases 15% 11% $
Slide 32: ABR Dissection
ABR DISSECTION Insight #4: Bias toward Highest Quality Anchors Correlates with Lower ABR Peer Comparison Credit Quality of Top 20 Tenants vs. Portfolio ABR HIGH 12 KIM D 10 % of TOP 20 DDR 8 Tenants Rated WRI “A” 6 REG EQY FRT 4 LOW $12.00 $14.00 $16.00 $18.00 $20.00 $22.00 $24.00 LOWER ABR HIGHER S
Slide 33: Continued Portfolio Strengthening
CONTINUED PORTFOLIO STRENGTHENING Historical U.S. Occupancy Trend All-Time High 96.3% - 96.5% 94.4% 93.9% 93.1% 92.4% 4Q10 4Q11 4Q12 3Q13 4Q16 E 33
Slide 34: Continued Portfolio Strengthening
CONTINUED PORTFOLIO STRENGTHENING New Leasing Spreads: KIM vs. Peer Average 21.6% 20.2% 14.4% 13.6% 11.9% 8.4% 9.3% 9.3% 4.5% 4.1% Trailing Trailing Trailing Trailing Trailing 4 Qtrs 8 Qtrs 12 Qtrs 16 Qtrs 20 Qtrs KIM Peer Average Source: Peer company documents Peer group includes: FRT, REG, EQY, WR
Slide 35: Continued Portfolio Strengthening
CONTINUED PORTFOLIO STRENGTHENING Total Leasing Spreads: KIM vs. Peer Average 9.9% 8.6% 9.0% 6.8% 6.3% 5.4% 4.5% 4.6% 3.6% 3.6% Trailing Trailing Trailing Trailing Trailing 4 Qtrs 8 Qtrs 12 Qtrs 16 Qtrs 20 Qtrs KIM Peer Average Source: Peer company documents Peer group includes: FRT, REG, EQY, WRI,
Slide 36: Embedded Value in Our Portfolio
EMBEDDED VALUE IN OUR PORTFOLIO U.S. Portfolio ~ 10K Leases | 68M sf Anchor Leases (≥ 10K sf) Small Shop Leases (<10K sf) • ~2,000 Leases, 53.4M sf • ~8,000 Leases,14.7M sf • 78% of occupied GLA, 62% of ABR • 22% of occupied GLA, 38% of ABR • $10.13 Avg. rent / sf • $23.06 Avg. rent / sf Anchor Valu
Slide 37: Embedded Value in Our Portfolio
EMBEDDED VALUE IN OUR PORTFOLIO Continued Upside for Anchor Spaces • 10% of leases expiring through 2017 = 24%+ spread on mark-to-market • Expiring leases through 2017 include: ‒ 5 Kmart leases; 253% below market ‒ 11 office supply leases; 37% below market Notable 2014 Maturing Anchor Leases • Renai
Slide 38: Embedded Value in Our Portfolio
EMBEDDED VALUE IN OUR PORTFOLIO Runway to NOI through Small Shop Space Small Shop Value Creation: Opportunity • Current small shop occupancy = 84.7%; 360bps increase since 1Q 2011 • Small shop space occupancy target: 90% by 2016 • Equates to approximately $21M of new pro-rata annualized base rent Sm
Slide 39: U.S. Same-Site NOI Drivers
U.S. SAME-SITE NOI DRIVERS Achieving 3-Year Average Same-Site NOI Growth: 3.0%+ • Awaiting rent commencements Leasing • Renewals & options 70 - 100 bps • Occupancy gains • Mark-to-market • Contractual rent bumps Organic Growth • Ancillary income 120 - 150 bps • Percentage rent • Improving credit los
Slide 40: Property Redevelopment
PROPERTY REDEVELOPMENT Increasing Portfolio Value Cottman & Bustleton Center | Philadelphia, PA BEFORE • Aggressive pursuit of redevelopment opportunities within portfolio • Focus remains on Key Territories and highly productive centers • Potential for ground-up AFTER development • Target ROI of >10
Slide 41: Redevelopment Pipeline
REDEVELOPMENT PIPELINE: ~$816M ($539M KIMCO SHARE) Gross Costs by Project Type ($MM) Gross Costs by Stage ($MM) $30 $326 Redevelopments Active $76 Value Creation Planning $710 Pads/Outlots Evaluation $215 $275 Gross Costs by Estimated Year of Completion ($MM) $323 $249 $247 Future Costs $208 Gross C
Slide 42: Redevelopment Case Studies: Completed
REDEVELOPMENT CASE STUDIES COMPLETED Westlake Shopping Center | Daly City, CA 42
Slide 43: Westlake Shopping Center Overview
OVERVIEW Westlake Shopping Center | Daly City, CA Gross Incremental Costs NOI ROI Prior to Investor Day 2010 $79.0M $8.8M 12% Since Investor Day 2010 $1.8M $0.6M 35% • Added roadway through site, promoting vehicle and pedestrian traffic • Expanded Safeway (8K sf) with over 50% increase in ABR/sf ($1
Slide 44: Westlake Shopping Center Before and After
Westlake Shopping Center | Daly City, CA BEFORE AFTER 44
Slide 45: Westlake Shopping Center Before and After
Westlake Shopping Center | Daly City, CA BEFORE AFTER 45
Slide 46: Richmond Shopping Center Overview
OVERVIEW Richmond Shopping Center | Staten Island, NY Gross Incremental Costs NOI ROI $4.6M $2.2M 42% • Redeveloped existing Kmart (102K sf) for new Target (142K sf) and added Miller's Ale House (8K sf) • Other new credit tenants added to the site include complement existing tenants and form nice co
Slide 47: Richmond Shopping Center Before and After
Richmond Shopping Center | Staten Island, NY BEFORE AFTER 47
Slide 48: Richmond Shopping Center Before and After
Richmond Shopping Center | Staten Island, NY BEFORE AFTER 48
Slide 49: Redevelopment Case Studies: In Progress
REDEVELOPMENT CASE STUDIES IN PROGRESS Wilde Lake | Columbia, MD 49
Slide 50: Wilde Lake Overview
OVERVIEW Wilde Lake | Columbia, MD Gross Incremental Costs NOI ROI $17.9M $1.5M 9% • 250 residential rental units and retail redevelopment replacing a vacant food anchor • Recaptured an old underutilized gas pad and will redevelop into new CVS Pharmacy pad site • Received building permits and planni
Slide 51: Wilde Lake Before and After
Wilde Lake | Columbia, MD BEFORE AFTER 51
Slide 52: Wilde Lake Before and After
Wilde Lake | Columbia, MD BEFORE AFTER 52
Slide 53: Pompano Beach Overview
OVERVIEW Pompano Beach | Pompano, FL Gross Incremental Costs NOI ROI $10.9M $1.2M 11% • Property situated along major retail corridor in Pompano Beach • Opportunistically terminated Kmart lease early to demolish building and redevelop property • Build-to-suit leases with Whole Foods (40K sf) and The
Slide 54: Pompano Beach Before and After
Pompano Beach | Pompano, FL BEFORE AFTER 54
Slide 55: Pompano Beach Before and After
Pompano Beach | Pompano, FL BEFORE AFTER 55
Slide 56: Cupertino Village Overview
OVERVIEW Cupertino Village | Cupertino, CA Cupertino Gross Incremental Village Costs NOI ROI $16.0M $1.2M 8% • Entitlements to build 23K sf (Retail A & B) • Creation of three points of connectivity to the new Apple II Campus • Redesigning interior courtyard and adding amenities, such as Wi-Fi, to cr
Slide 57: Cupertino Village Before and After
Cupertino Village | Cupertino, CA BEFORE AFTER Phase II not included 57
Slide 58: Cupertino Village Before and After
Cupertino Village | Cupertino, CA BEFORE AFTER 58
Slide 59: Fairview City Centre Overview
OVERVIEW Fairview City Centre | Fairview Heights, IL Gross Incremental Costs NOI ROI $19.0M $2.1M 11% • Acquisition of ground lease position • Recapture of Kmart lease and demolition of building • Office Max downsize and relocation • New Sports Authority, Fresh Thyme Farmers Market and Home Goods •
Slide 60: Fairview City Centre Before and After
Fairview City Centre | Fairview Heights, IL BEFORE AFTER 60
Slide 61: Fairview City Centre Before and After
Fairview City Centre | Fairview Heights, IL BEFORE AFTER 61
Slide 62: Redevelopment Case Studies: Future
REDEVELOPMENT CASE STUDIES FUTURE Westwood Plaza| Charleston, SC 62
Slide 63: Westwood Plaza Overview
OVERVIEW Westwood Plaza | Charleston, S.C. Gross Incremental Costs NOI ROI $7.8M $0.8M 11% • Redevelop shopping center currently anchored by TJ Maxx, Office Depot and Barnes & Noble • Located along the heavily trafficked Sam Rittenberg Parkway, minutes from Charleston’s Historic District • Relocate
Slide 64: Westwood Plaza Before and After
Westwood Plaza | Charleston, S.C. BEFORE AFTER 64
Slide 65: Westwood Plaza Before and After
Westwood Plaza | Charleston, S.C. BEFORE AFTER 65
Slide 66: Hylan Plaza Overview
OVERVIEW Hylan Plaza | Staten Island, NY Gross Incremental Costs NOI ROI $26.6M $2.4M 9% • Full redevelopment based upon expiration of existing anchors in 2017 • Start entitlement process for full redevelopment in 2014 • Rare opportunity for large national anchor retailer to gain access to Staten Is
Slide 67: Hylan Plaza Before and After
Hylan Plaza | Staten Island, NY BEFORE AFTER AFTER 67
Slide 68: Hylan Plaza Before and After
Hylan Plaza | Staten Island, NY BEFORE AFTER AFTER 68
Slide 69: Summary
SUMMARY Intense Focus on Operational Execution • Leasing, Leasing, Leasing: Anchor and small shop initiatives in place to drive occupancy to new highs • Transformation strategy well underway; focused on high quality assets in key territories • Disciplined approach to disposing assets; balanced appro
Slide 70: Scott Onufrey
Santee Trolley Square | Santee, CA Scott Onufrey Senior Vice President 70
Slide 71: Asset Acquisitions
ASSET ACQUISITIONS A Refined Approach to Buying Great Assets • Focus on 15 Key Territories Santee Trolley Square, Santee, California ─ Consist of the largest MSAs in the U.S. ─ Markets where Kimco has scale and an efficient operating platform ─ Local offices supply “boots on the ground” • Low risk /
Slide 72: Asset Acquisitions Process
ASSET ACQUISITIONS PROCESS Diligent, Disciplined Approach… Deals vetted by Deal presented to Investment Regional President, Investment Committee reviews Acquisition Officer, Committee every deal COO and SVP Deals > $100M require BoD approval Detailed due diligence performed Asset by independent risk
Slide 73: Asset Dispositions
ASSET DISPOSITIONS A Systematic Approach to Upgrading the Portfolio • Non-core properties located in secondary West Gates S.C., Rochester, New York and tertiary markets – operationally inefficient • Limited growth potential, higher risk ‒ CAGR < 1.5% ‒ Chronic vacancy > 10% • Initiated aggressive re
Slide 74: Reducing JV Partnerships – Simplifying the Story
REDUCING JV PARTNERSHIPS – SIMPLIFYING THE STORY Kimco as Buyer - Benefits Serve Partners and Kimco • Minimal due diligence costs and time to close • Certainty of close for the partner • Most secured debt on properties can be assumed quickly and inexpensively • Negotiated transactions result in no /
Slide 75: Reducing JV Partnerships - Simplifying the Story
REDUCING JV PARTNERSHIPS - SIMPLIFYING THE STORY Achieved Significant Reductions in JV Portfolio Since 2010 Properties 551 $12.3B 419 Gross $10.7B Investment 2010 2013 Gross SF 83.4M 65.0M Path Forward Promising…Excellent Reservoir of Opportunities 75
Slide 76: Reducing JV Partnerships - Simplifying the Story
REDUCING JV PARTNERSHIPS - SIMPLIFYING THE STORY What You Can Expect Going Forward • We are committed to reducing our JV ownership structure over time • Acquiring three grocery-anchored shopping centers from JV with LaSalle; one property remains JV and will be dissolved during 2H14 • Potential for d
Slide 77: Results
RESULTS Shift Has Resulted in Higher Quality Portfolio, Improved Operating Metrics Acquisitions Dispositions Progress Number of Properties 73 139 Gross GLA (000s) 9,587 14,471 Portfolio Metrics Pro-rata Occupancy 95.7% 85.7% 1,000 bps Pro-rata ABR/sf $14.17 $8.91 59.0% Demographics Average HHI $92,8
Slide 78: Upgrading the Portfolio
UPGRADING THE PORTFOLIO ACQUIRED SOLD ACQUIRED Westerville Plaza, Westerville, Ohio (MSA: Columbus) Santee Trolley Square, Santee, California (MSA: San Diego-Carlsbad-San Marcos) 78
Slide 79: Upgrading the Portfolio
UPGRADING THE PORTFOLIO SOLD ACQUIRED Woodforest S.C., Houston, Texas (MSA: Houston-Sugar Land-Baytown) Greeley Commons, Greeley, Colorado (MSA: Greeley) 79
Slide 80: Upgrading the Portfolio
UPGRADING THE PORTFOLIO SOLD ACQUIRED Salem Plaza, Trotwood, Ohio (MSA: Dayton) Shops at Kildeer, Kildeer, Illinois (MSA: Chicago-Joliet-Naperville) 80
Slide 81: Upgrading the Portfolio
UPGRADING THE PORTFOLIO SOLD ACQUIRED Mount Rose Plaza, York, Pennsylvania (MSA: York-Hanover) Dulles Town Crossing, Sterling,Virginia (MSA: Washington-Arlington-Alexandria) 81
Slide 82: Upgrading the Portfolio
UPGRADING THE PORTFOLIO SOLD ACQUIRED Kmart Plaza, Brunswick, Ohio (MSA: Cleveland-Elyria-Mentor) The Marketplace at Factoria, Bellevue, Washington (MSA: Seattle-Tacoma-Bellevue) 82
Slide 83: Upgrading the Portfolio
UPGRADING THE PORTFOLIO SOLD ACQUIRED Lafayette S.C., Lafayette, Indiana (MSA: Lafayette) Towson Place, Towson, Maryland (MSA: Baltimore-Towson) 83
Slide 84: Upgrading the Portfolio
UPGRADING THE PORTFOLIO SOLD ACQUIRED Value City S.C., Ottawa, Illinois (MSA: Ottawa-Streator) The Shops at District Heights, District Heights, Maryland (MSA: Washington-Arlington-Alexandria) 84
Slide 85: Upgrading the Portfolio
UPGRADING THE PORTFOLIO ACQUIRED ACQUIRED Centre Court, Pikesville, Maryland (MSA: Baltimore-Towson) Midtown Commons S.C., Knightdale, North Carolina (MSA: Raleigh-Cary) 85
Slide 86: Upgrading the Portfolio
UPGRADING THE PORTFOLIO ACQUIRED ACQUIRED Woodbridge S.C., Sugar Land, Texas (MSA: Houston-Sugar Land-Baytown) Grand Oaks Village, Orlando, Florida (MSA: Orlando-Kissimmee-Sanford) 86
Slide 87: Upgrading the Portfolio
UPGRADING THE PORTFOLIO ACQUIRED ACQUIRED Davidson Commons, Davidson, North Carolina (MSA: Charlotte-Gastonia-Rock Hill) Wexford Plaza, Pittsburgh, Pennsylvania (MSA: Pittsburgh) 87
Slide 88: Upgrading the Portfolio
UPGRADING THE PORTFOLIO ACQUIRED ACQUIRED City Heights Center, San Diego, California (MSA: San Diego-Carlsbad-San Marcos) Wilton River Park S.C., Wilton, Connecticut (MSA: Bridgeport-Stamford-Norwalk) 88
Slide 89: Upgrading the Portfolio
UPGRADING THE PORTFOLIO ACQUIRED ACQUIRED Hawthorn Hills Square, Vernon Hills, Illinois MSA: Chicago-Joliet-Naperville Columbia Crossing II, Columbia, Maryland MSA: Baltimore-Towson 89
Slide 90: Update on Recent Deals
UPDATE ON RECENT DEALS New England Portfolio Acquisition • Contract to acquire a portfolio of 24 retail assets totaling 1.4M sf with assets in Massachusetts (21), Connecticut (1) and New Jersey (2 ) • Purchase Price of $270M • Rare opportunity to purchase portfolio located in a challenging-to-penetr
Slide 91: New England Portfolio
NEW ENGLAND PORTFOLIO Brighton, Massachusetts Cambridge, Massachusetts Danbury, Connecticut Medford, Massachusetts Abington, Massachusetts 91
Slide 92: Update on Pending Deals
UPDATE ON PENDING DEALS Selected Closed and Pending Transactions • Recently completed the acquisition of two grocery and one drug-store-anchored properties totaling $36M in the New York suburb of Clark, NJ • Two assets under contract in Houston totaling $102M • Two assets under contract in North Car
Slide 93: Transformation... Roadmap to our future portfolio
Transformation… …Roadmap to our future portfolio
Slide 94: U.S. Portfolio Transformation
U.S. PORTFOLIO TRANSFORMATION Investor Day 2010 Sites Sold Since 2010 Kimco Sites Kimco Offices MSA’s Key Territories 94
Slide 95: U.S. Portfolio Transformation
U.S. PORTFOLIO TRANSFORMATION Current Disposition Candidates Sites Acquired Kimco Sites Kimco Offices MSA’s Key Territories 95
Slide 96: U.S. Portfolio Transformation
U.S. PORTFOLIO TRANSFORMATION Tier 1 and Tier II Properties Tier 1 Tier II Kimco Offices MSA’s Key Territories 96
Slide 97: U.S. Portfolio Transformation
U.S. PORTFOLIO TRANSFORMATION Longer Term Portfolio Footprint – Tier 1 Kimco Sites Kimco Offices MSA’s Key Territories A More Focused Kimco 97
Slide 98: Summary
SUMMARY Portfolio Transformation Is Well Underway and Will Continue… • Acquisition/disposition activity is producing results ‒ Focused geographies ‒ Larger assets ‒ Higher growth potential ‒ Stronger metrics • JV buyout progress has been strong with more potential ahead ‒ Simplify our ownership stru
Slide 99: Q&A
Sunset Valley Marketfair | Austin,TX Q&A 99
Slide 100: Regional Overview
Centre Court | Pikesville, MD Regional Overview 100
Slide 101: Canada Region – Kelly Smith
CANADA REGION – KELLY SMITH Properties Sq. Ft. Occupancy Acquired (since 2010) Sold (since 2010) 67 12.7M 95.8% 6 sites (1.0M sf, $246.1M) 1 site (50K sf, $11.2M) Macroeconomic Overview Trends • Stable economy with strong banking sector, • Recent consolidation: Loblaw, Sobeys, employment and populat
Slide 102: Central Region – Rob Nadler
CENTRAL REGION – ROB NADLER Properties Sq. Ft. Occupancy Acquired (since 2010) Sold (since 2010) 162 22.2M 96.2% 13 sites (2.2M sf, $283.6M) 45 sites (7.0M sf, $503.5M) Macroeconomic Overview Trends • Texas economy robust; leads nation in job • New construction gaining momentum and population growth
Slide 103: Western Region – Armand Vasquez
WESTERN REGION – ARMAND VASQUEZ Properties Sq. Ft. Occupancy Acquired (since 2010) Sold (since 2010) 188 31.3M 92.4% 17 sites (2.7M sf, $587.1M) 26 sites (2.0M sf, $157.4M) Macroeconomic Overview Trends • Large increases in home values in major • Seattle: Growth in technology MSAs raising home equit
Slide 104: Southern Region – Paul Puma
SOUTHERN REGION – PAUL PUMA Properties Sq. Ft. Occupancy Acquired (since 2010) Sold (since 2010) 131 21.3M 93.8% 20 sites (2.1M sf, $344.6M) 34 sites (3.4M sf, $266.5M) Macroeconomic Overview Trends • Strong economic growth in key employment • Retailer expansion: Bed Bath & Beyond, sectors in most m
Slide 105: Eastern Region – Tom Simmons
EASTERN REGION – TOM SIMMONS Properties Sq. Ft. Occupancy Acquired (since 2010) Sold (since 2010) 251 27.8M 96.2% 23 sites (2.6M sf, $545.7M) 34 sites (2.0M sf, $220.9M) Macroeconomic Overview Trends • Stable population & job growth • Cap rates well below national cap rates for last eight quarters •
Slide 106: Q&A
Westlake S.C. | Daly City, CA Q&A 106
Slide 107: Ray Edwards
City Heights Center | San Diego, CA Ray Edwards Vice President, Retailer Services 107
Slide 108: Credit Quality
CREDIT QUALITY Proactive Monitoring Enables Kimco U.S. Bad Debt As a % of Revenues to Get in Front of Issues Proprietary Inputs Watchdog Model 1.2% Financo Credit 1.1% Monitor 1.0% Creditntell 0.9% Retailer Credit Credit Ratings Ranking System 0.8% S&P (RCRS) 0.7% Fitch Moody’s 0.6% Industry Trends
Slide 109: Watch List
WATCH LIST Watch List for Top 50 Retailers (by ABR) Updated Monthly Based on RCRS ++ Centralized Monitoring 1.0 Excellent Credit Captures 54% of Portfolio by GLA KIM Avg: 1.8 2.0 Good to Average Credit Proactively Utilized by Management: • Identify replacement tenants, 3.0 Watch; Monitor Closely neg
Slide 110: Key Differentiator: The "Plus"
KEY DIFFERENTIATOR: THE “PLUS” Ability to Act Opportunistically with Retailer-Controlled Real Estate… (Acquire/Release (Designation (Designation Rights) Rights) (Privatization) (Real Estate Financing) to tenants) (Acquire/Release to tenants) (Bond Purchase) (Real Estate Financing) (Acquire/Release t
Slide 111: Value Creation Case Study: Albertsons – 2006
VALUE CREATION CASE STUDY: ALBERTSONS -- 2006 Deal Background • Acquired SUPERVALU core grocery business Kimco Investment: • Acquired 600 Kimco non-core • $51M Consortium Albertsons • CA, TX, FL • 13.5% Stake • Acquired CVS pharmacy division 111
Slide 112: Value Creation Case Study: Albertsons – 2006
VALUE CREATION CASE STUDY: ALBERTSONS -- 2006 Deal Economics and Outcome Year 1 • Hired Bob Miller as CEO Cash • ~125 unprofitable locations closed distributions Turnaround • N. California division sold to totaling $245M Story SaveMart or 483% from Year 2 2007 - 2012 • Sold 50% of FL stores to Publi
Slide 113: Current Investment: SUPERVALU (SVU) – 2013
CURRENT INVESTMENT: SUPERVALU (SVU) -- 2013 • Partnered with consortium from original Albertsons deal • Two-step transaction Transaction Step 1 Transaction Step 2 • Acquired five grocery banners; 877 • Acquired 18% of SVU common stock properties for $3.3B @ $4.11 share (as of 3/21/13) ‒ 8.2M SVU sha
Slide 114: Glenn Cohen
Union Crescent Plaza | Union, NJ Glenn Cohen EVP and Chief Financial Officer 114
Slide 115: Transformation Since 2010
TRANSFORMATION SINCE 2010 The Story: Steady FFO Growth with a Transforming Portfolio and Improved Balance Sheet • We are “back to basics” and continue to simplify the business ‒ Focus is on U.S. and Canada retail real estate ‒ Completed sale of non-retail investments ‒ South America exit nearing com
Slide 116: A Successful Three Years…And More Ahead
A SUCCESSFUL THREE YEARS…AND MORE AHEAD Recurring FFO Has Grown Consistently Raised Dividend Commensurate at Steady 5% CAGR with Recurring FFO/Share Growth $1.32 - $0.84 $1.26 $1.33 $0.76 $1.14 $1.20 $0.72 $0.64 2010 2011 2012 2013 2010 2011 2012 2013 Key Success Drivers • Simplification/focus on th
Slide 117: Accessed Low Cost Capital and Rebalanced Capital Structure
ACCESSED LOW COST CAPITAL AND REBALANCED CAPITAL STRUCTURE • Issued $800M in perpetual preferred equity, replacing higher coupon perpetual preferred • Refinanced over $1B of maturing debt at lower rates, maintaining a well-laddered maturity profile • Since 2009, Kimco has NOT had a common equity iss
Slide 118: Excellent Progress on Leverage
EXCELLENT PROGRESS ON LEVERAGE Net Debt Maintained at ~$4B While Recurring EBITDA Has Increased… $735 Recurring $694 EBITDA $646 ($MM) ~6% CAGR $617 $590 12/31 Net Debt $4.3 $3.9 $4.0 $4.1 $4.1 ($B) 2009 2010 2011 2012 2013E* 7.3x 6.4x 6.2x 5.9x 5.6x S&P: BBB+ Moody’s: Baa1 Fitch: BBB+ * 2013 Figure
Slide 119: Balance Sheet Metrics
BALANCE SHEET METRICS Investor Day Today 2010 Debt/Market-cap 40.3% 31.8% Net Debt/Gross Assets 36.4% 33.7% Net Debt/Recurring EBITDA 6.6x 5.4x Fixed Charge Coverage 2.4x 2.9x Maintain Balance Sheet Strength 119
Slide 120: Well-Staggered Debt Maturity Profile
WELL-STAGGERED DEBT MATURITY PROFILE Consolidated Debt Weighted Avg. Fixed Rate: 5.34% $1,200 Weighted Avg. Floating Rate: 2.08% 20% $900 $MM 17% 12% 13% $600 12% 10% 7% $300 6% 2% 1% 0% $- 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Thereafter Secured Unsecured Line of Credit Unsecured Term L
Slide 121: Balance Sheet Strategy
BALANCE SHEET STRATEGY • Positioned to access capital at all times in multiple forms • Preserve strong liquidity position; $1.75B available from unsecured line of credit • Repay maturing mortgage debt of over $600M by 2016; continue increasing unencumbered asset pool of over 390 assets • Maintain st
Slide 122: Total Shareholder Return
TOTAL SHAREHOLDER RETURN Transformation Has Driven Solid Returns Since 2009 Total Shareholder Return(1) 1 Year 3 Year Total to Date 12/31/09 – 12/31/10 12/31/09 – 12/31/12 12/31/09 – 10/31/13 39% 62% 64% 86% 28% 76% 71% 36% 15% KIM REIT Avg.S&P 500 KIM REIT Avg.S&P 500 KIM REIT S&P Avg. 500 KIM NARE
Slide 123: We are "Back"… …So What's Next?
We are “Back”… …So What’s Next? 123
Slide 124: Growing NOI in the Existing Portfolio
GROWING NOI IN THE EXISTING PORTFOLIO $1,115 ($MM) $110 $990 $3 $2 Canada $100 $2 $3 $44 $30 $925 $795 $22 U.S. $34 U.S. & Latin Am. $95 (Cancun to Cambridge) (2) ($15) $80 Sales 2013 Dilution Organic Leasing Redev. Additional 2016E BASE from Growth/ and Pipeline Acquisitions (1) Asset Contractual L
Slide 125: Recurring Retail Earnings Growth
RECURRING RETAIL EARNINGS GROWTH ($MM) ~1064 ~980 233 ~947 914 248 to 860 270 245 814 to to 259 264 274 225 240 672 717 814 to to to 589 42 620 41 650 40 677 735 836 21 2 2010 2011 2012 2013E 2014E 2016E Consolidated Retail JV Retail Non-Retail Retail Contribution Expected to Be 100% by the End of 2
Slide 126: Guidance Track Record
GUIDANCE TRACK RECORD Kimco Has Delivered Consistent, Predictable Results in Recent Years 2011 (1) 2012 2013 2014 (2) Guidance Actual Guidance Actual Guidance Forecast Guidance FFO, $1.17 - $1.22 - $1.28 - ~$1.32 - $1.36 - As Adjusted $1.20 $1.26 $1.21 $1.26 $1.33 1.33 $1.40 Per Share SS NOI 0.0% -
Slide 127: 2014 Funds From Operations (FFO) Guidance
2014 FUNDS FROM OPERATIONS (FFO) GUIDANCE FFO ($MM) FFO/Share (2) 2014 Assumptions (3) (3) 2013F 2014F 2013F 2014F Recurring: Retail $942 – $951 $965 – $994 $2.29 – $2.31 $2.34 – $2.41 • Acquisition of shopping Non-Retail centers: $950M to 20 – 23 1–4 0.05 – 0.06 0.00 – 0.01 $1,100M (Kimco cash Fina
Slide 128: Sources & Uses of Capital – No Common Equity Needed
SOURCES & USES OF CAPITAL – NO COMMON EQUITY NEEDED SOURCES ($MM) 2013(1) 2014 – 2016(1) Retail Portfolio Recycling Dispositions $690 $1,200 Non-Retail Dispositions 330 80 Debt Financings 640 2,100 FAD After Common Dividends 100 300 Other 40 120 Total Sources $1,800 $3,800 USES ($MM) Consolidated De
Slide 129: Summary
SUMMARY We Will Build on Our Successes and Continue to Drive Total Shareholder Return (“TSR”) • Clear, compelling investment thesis • Laser focus on what we do best – owning & operating retail assets • Strong execution at portfolio/property level • Responsible, efficient capital structure providing
Slide 130: Q&A
Santee Trolley Square | Santee, CA Q&A 130
Slide 131: Closing Remarks
CLICK TO EDIT MASTER TITLE STYLE • Click to edit Master text styles ‒ Second level › Third level ‒ Fourth level ‒ Fifth level Airport Plaza | Farmingdale, NY Closing Remarks 131
Slide 132: Why Kimco
WHY KIMCO 1. Largest owner & operator of shopping centers with 50 years of history and retail expertise 2. Strong balance sheet and related credit ratings with excellent liquidity Growth embedded in U.S. shopping center portfolio through leasing and 3. redevelopment Additional value creation via int
Slide 133: Appendix
Wilton River Park S.C. | Wilton, CT Appendix
Slide 134: Safe Harbor
SAFE HARBOR The statements in this news release state the company's and management's intentions, beliefs, expectations or projections of the future and are forward-looking statements. It is important to note that the company's actual results could differ materially from those projected in such forwa
Slide 135: Reconciliation of FFO to Net Income
RECONCILIATION OF FFO TO NET INCOME (2) (2) 2013F 2014F 2013F 2014F FFO $550 – $556 $560 – $578 $1.34 – $1.35 $1.36 – $1.40 Depreciation and amortization (252) – (260) (256) – (264) (0.61) – (0.63) (0.62) – (0.64) Depreciation and amortization real estate JVs(1) (122) – (130) (118) – (126) (0.30) –