Piedmont Realty Trust, Inc. · NYSE:PDM
Piedmont Realty Trust — Piedmont Office Realty Trust — Investor Presentation (June 2019)
23 slides from Piedmont Realty Trust's investor presentation, June 2019
Slide 1: Investor Presentation June 2019
INVESTOR PRESENTATION JUNE 2019
Slide 2: Introduction
INTRODUCTION Piedmont Office Realty Trust, Inc. (also referred to herein as “Piedmont” or the “Company”) (NYSE: PDM) is an owner, manager, developer and operator of high-quality, Class A office properties in select sub-markets located primarily within eight major eastern U.S. office markets. The Com
Slide 3: Points of Discussion
POINTS OF DISCUSSION
Slide 4: Points of Discussion: Corporate Objectives and 2019 YTD Highlights
POINTS OF DISCUSSION CORPORATE OBJECTIVES 2019 YTD HIGHLIGHTS • Decreased exposure to SW Washington DC Concentrate Ownership in Specific Submarkets submarket with sale of One Independence Square for Balance of CBD, Urban Infill and “Hub-urban” Locations $508/SF; Washington ALR now at 12% Across Our
Slide 5: Piedmont Corporate Overview
PIEDMONT CORPORATE OVERVIEW
Slide 6: Who Is Piedmont?
WHO IS PIEDMONT? QUALITY, DISTINCTIVE PORTFOLIO ACCRETIVE CAPITAL RECYCLING GLENRIDGE HIGHLANDS TWO Atlanta, GA FINANCIAL STRENGTH AND FLEXIBILITY LOCAL OPERATIONAL MANAGEMENT ARLINGTON GATEWAY ARLINGTON, VA 5
Slide 7: Quality, Distinctive Portfolio
QUALITY, DISTINCTIVE PORTFOLIO EIGHT OF THE NATION’S LARGEST MARKETS: WELL-LOCATED, AMENITIZED OFFICE ENVIRONMENTS – CBD, URBAN INFILL & “HUB-URBAN” NODES 500 West Monroe 20% Marketed for Sale 14% 13% 12% 12% 12% 12% 12% 11% 11% 11% 10% 9% 9% 9% 8% 8% 7% Atlanta NY/NJ Minneapolis DC Orlando Boston D
Slide 8: Atlanta - Northwest Submarket
QUALITY, DISTINCTIVE PORTFOLIO ATLANTA - NORTHWEST SUBMARKET PDM Submarket Investment Submarket Rents Central Perimeter $35/SF $250M ~$195 ~50% Est. Current Basis Galleria $31/SF Original Investment Original Investment Discount to per SF Replacement Cost Buckhead $41/SF PDM Assets’ Performance Subma
Slide 9: Atlanta - Galleria Amenity Base
QUALITY, DISTINCTIVE PORTFOLIO ATLANTA - GALLERIA AMENITY BASE • 5 Cafes ONSITE • 3 Conference Centers • 6,000 SF Fitness Facility with Locker Rooms 8
Slide 10: Boston - Burlington Submarket
QUALITY, DISTINCTIVE PORTFOLIO BOSTON - BURLINGTON SUBMARKET PDM Submarket Investment Submarket Rents ~30% Burlington $40/SF $270M ~$285 Est. Current Basis Original Investment Original Investment Discount to per SF Replacement Cost PDM Assets’ Performance Submarket vs. National Average Rent Growth4
Slide 11: Boston - Burlington Amenity Base
QUALITY, DISTINCTIVE PORTFOLIO BOSTON - BURLINGTON AMENITY BASE • 3 Cafes ONSITE • Conference Center Burlington Mall • 4,000 SF of Fitness Facilities with Locker Rooms Burlington Marketplace The District at Burlington 10
Slide 12: Orlando - CBD
QUALITY, DISTINCTIVE PORTFOLIO ORLANDO - CBD PDM Submarket Investment Submarket Rents Lake Mary $26/SF $365M ~$250 ~40% Est. Current Basis Original Investment Original Investment Discount to per SF Replacement Cost Maitland $25/SF PDM Assets’ Performance Submarket vs. National Average Rent Growth4 D
Slide 13: Orlando - CBD Amenity Base
QUALITY, DISTINCTIVE PORTFOLIO ORLANDO – CBD AMENITY BASE • 3 Cafes ONSITE • Conference Center • 5,000 SF Fitness Facility with Locker Rooms 12
Slide 14: Organic NOI Growth
QUALITY, DISTINCTIVE PORTFOLIO ORGANIC NOI GROWTH Capitalizing on Future Expirations (% of ALR 5) Proforma Lease Expirations (% of ALR 5) Realizing Contractual Cash Flow As of 3/31/2019 As of 3/31/2019 As of 3/31/2019 94% 3.3% 12% 12% Current Expected SunTrust, 0.9% 92% 10% Wendy's/Arbys, 1.1% 4.1%
Slide 15: Accretive Capital Recycling: Acquisitions as Redeployment Evidence
ACCRETIVE CAPITAL RECYCLING ACCRETIVELY RECYCLING CAPITAL- SINCE 2014, PIEDMONT HAS RECYCLED $1.2 BILLION OF DISPOSITION CAPITAL INTO REAL ESTATE ASSETS AT ROUGHLY 160 BPS HIGHER YIELD THAN DISPOSED ASSETS Recent Acquisitions as Redeployment Evidence 25 Mall Rd., Burlington Excelsior Blvd., Minneapo
Slide 16: Accretive Capital Recycling: Reimagining the Portfolio
ACCRETIVE CAPITAL RECYCLING REIMAGINING THE PORTFOLIO PIEDMONT IS SELECTIVELY IDENTIFYING REPOSITIONING OPPORTUNITIES TO CREATE ADDITIONAL VALUE Rationale for Investment • Activate and energize the environment for tenants • Basis remains at significant discount to development ✓ User needs are evolvi
Slide 17: Selective Development to Expand Large-Scale Positions
ACCRETIVE CAPITAL RECYCLING SELECTIVE DEVELOPMENT TO EXPAND LARGE-SCALE POSITIONS 1,000,000 SF 250,000 SF 250,000 SF Lake Mary, FL Atlanta, GA Atlanta, GA Adjacent to 400 & 500 TownPark Adjacent to Glenridge Highlands One & Two Adjacent to The Medici Land Basis: $6.3M Land Basis: $2.0M Land Basis: $
Slide 18: Financial Strength and Flexibility
FINANCIAL STRENGTH AND FLEXIBILITY LADDERED DEBT MATURITY SCHEDULE $400,000 $329,540 $340,100 $350,000 $250,000 2019 2020 2021 2022 2023 2024 2025 Term Loan & Revolver 7 & Bonds Bonds Term Loan 5 Wall 1901 Market DEBT PROFILE Secured Encumbered NOI Floating Rate 11% 8% 18% Unsecured Fixed Rate 89% U
Slide 19: Local Operational Management
LOCAL OPERATIONAL MANAGEMENT REAL ESTATE IS A LOCAL BUSINESS Piedmont maintains four regional offices to ensure local expertise is leveraged and relationships are cultivated within our markets. MIDWEST REGION - CHICAGO Tom Prescott Chicago and Minneapolis EVP, Midwest Region 8 buildings 34 Yrs of Ma
Slide 20: Appendix
APPENDIX
Slide 21: Appendix - Performance
APPENDIX - PERFORMANCE PIEDMONT REMAINS FOCUSED ON DELIVERING RESULTS FOR OUR SHAREHOLDERS AND GROWING NAV One Year TSR Green Street Estimated NAV - Growth 17.3% 25% 12.0% 7.9% 8.4% 7.2% 10% 9% 4.6% 3% -0.1% Last 3 Years Last 12 Months NYC Sunbelt Diverse GW DC West Coast Diverse PDM NGW Source: SNL
Slide 22: Appendix - Piedmont at a Glance
APPENDIX - PIEDMONT AT A GLANCE AS OF 3/31/2019 AS OF 3/31/2019 * INCLUDES PRO FORMA ADJUSTMENTS INCLUDES PRO FORMA ADJUSTMENTS Corporate Overview FOR GALLERIA 100 WHERE NOTED Portfolio Overview9 FOR GALLERIA 100 Ticker (NYSE) PDM Square Feet (millions) 16.3 Equity Market Cap as of 5/30/2019 (billio
Slide 23: Appendix - Footnotes
APPENDIX - FOOTNOTES 1 Source: Hartsfield-Jackson Atlanta International Airport website, Boston Logan International Airport website, & Orlando International Airport website, respectively. 2 Source: Kaggle 2018 Fortune 1000 Information, US Census Bureau 2017 Population Estimates. 3 Source: DataUSA.io
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