Allied Properties Real Estate Investment Trust · TSX:AP.UN
Allied Properties Real Estate Investment Trust — Q4 2024 Earnings Presentation
51 slides from Allied Properties Real Estate Investment Trust's earnings presentation, March 2025
Slide 1: Creativity & Connectivity
CREATIVITY & CONNECTIVITY March 2025 TSX: AP.UN | alliedreit.com
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 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Q4 2024 Results Update . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Portfolio Overview . . . . . . . . . . . . . . . . . . . . . .
Slide 4: Overview
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Slide 5: Overview
OVERVIEW Allied is a leading owner-operator of distinctive urban workspace in Canada’s major cities with a mission to provide knowledge-based organizations with workspace that is sustainable and conducive to human wellness, creativity, connectivity and diversity. 186 $6.4B RENTAL PROPERTIES ENTERPR
Slide 6: Investment Highlights
INVESTMENT HIGHLIGHTS – At the forefront of urban intensification in Canada's major cities and amenity rich neighborhoods backed by powerful demographic trends – Largest and most concentrated portfolio of economically-productive, underutilized land that affords extraordinary mixed-use intensificati
Slide 7: Portfolio Snapshot
PORTFOLIO SNAPSHOT GLA OF RENTAL PROPERTIES BY NOI (1) BY NOI (1) BY MARKET MARKET SPACE TYPE 6% 9% 13% 13% 8% 4% 41% 52% 31% 42% 81% TORONTO & KITCHENER MONTREAL TORONTO & KITCHENER MONTREAL OFFICE RETAIL PARKING CALGARY & EDMONTON VANCOUVER CALGARY & EDMONTON VANCOUVER (1) NOI is a non-GAAP measu
Slide 8: Strategy & Objectives
STRATEGY & OBJECTIVES 1 2 3 OWN AND OPERATE STRATEGICALLY COMPLETE THE MOST DISTINCTIVE RECYCLE AND CURRENT MIXED USE URBAN ALLOCATE CAPITAL DEVELOPMENTS WORKSPACES IN TO STRENGTHEN AND LEASE- CANADA’S LARGEST THE BALANCE UP ORGANIC MARKETS SHEET PORTFOLIO 4 5 ACCELERATE THE ONGOING ESTABLISHMEN
Slide 9: Q4 2024 Results Update
ALLIED Q4 2024 Results Update
Slide 10: Financial Performance
FINANCIAL PERFORMANCE Temporary downward pressure on FFO per Unit and AFFO per Unit as a result of the 400 West Georgia and 19 Duncan transactions. The EBITDA on these assets is expected to increase as they approach stabilization. Q4 2024 Q4 2023 FFO PER UNIT (1) $0.535 $0.614 AFFO PER UNIT (1) $0.4
Slide 11: Leasing Performance
LEASING PERFORMANCE Q4 2024 Q4 2023 AVERAGE IN-PLACE NET RENT PER OCCUPIED SQUARE FOOT $25.41 $24.10 RETENTION RATE 68.8% 60.9% RENT GROWTH ON RENEWAL 2.0% 3.6% SUB-LEASE SPACE AS A % OF TOTAL GLA 5.7% 5.1% RENEWED % OF 2025 LEASE MATURITIES 23.9% N/A 11
Slide 12: New Capital
NEW CAPITAL – Allied has access to attractive sources of capital via its large unencumbered asset pool and monetization of non-core properties at or above IFRS value – In 2025, Allied is targeting to unlock at least $300M of low-cost capital, which will be used for accretive debt reduction 2024 DISP
Slide 13: Portfolio Overview
ALLIED Portfolio Overview
Slide 14: Preferred Provider of Workspace in the Canadian Urban Market
PREFERRED PROVIDER OF WORKSPACE IN THE CANADIAN URBAN MARKET TOTAL RENTAL PORTFOLIO GLA (3) 186 RENTAL PROPERTIES VALUED AT $8.6 B (1) (Not including Properties Under Development valued at $0.8B 14.3M SF and Investment Properties Held for Sale valued at $0.3B) (1) MONTRÉAL VANCOUVER 6.0M SF 1.3M SF
Slide 15: Allied Asset Categories
ALLIED ASSET CATEGORIES Adaptively re-used light Mid- to high-rise structures Buildings slated for redevelopment industrial structures upgraded purpose built for workspace use. in the next five to 10 years that for office and retail uses. currently offer flexible lease terms. 15
Slide 16: Portfolio Vacancy
PORTFOLIO VACANCY The majority of Allied's vacancy is concentrated in 12 properties. 12.8% VACANCY OVERVIEW OF Over half of Allied’s portfolio TOP 12 PROPERTIES Q4 2024 6.9% vacancy is concentrated in 12 properties SQUARE FEET OF VACANCY ~984,000 PERCENT OF TOTAL GLA 6.9% 5.9% PERCENT OF TOTAL VACAN
Slide 17: Average In-Place Net Rent per Occupied Square Foot
AVERAGE IN-PLACE NET RENT PER OCCUPIED SQUARE FOOT URBAN WORKSPACE PORTFOLIO 10-YEAR AVERAGE 3.7% CAGR $28 $26 $25.41 $24 $24.10 $23.10 $22 $21.98 $21.35 $20 $20.36 $19.42 $18 $18.38 $18.51 $17.71 $17.93 $16 $14 $12 $10 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 17
Slide 18: Lease Maturities - Urban Workspace
LEASE MATURITIES - URBAN WORKSPACE % OF TOTAL GLA W/A RENTAL RATE ESTIMATED W/A MARKET RATE WEIGHTED AVERAGE RENTAL RATE % OF TOTAL GLA 1,295,209 1,433,765 1,461,590 975,840 1,152,449 SQUARE FEET This page contains forward-looking information. As at December 31, 2024. 18
Slide 19: Tenant Profile
TENANT PROFILE WEIGHTED AVERAGE % OF RENTAL REMAINING LEASE % OF TOTAL TOTAL PORTFOLIO % OF RENTAL TOP-10 USERS REVENUE (1) TERM (YRS) RENTAL GLA REVENUE BY CATEGORY GOOGLE CANADA CORPORATION (2) 3.3% 7.6 3.3% 3.2% 2.5% 3.5% UBISOFT DIVERTISSEMENTS INC. 2.9 7.5 3.8 5.2% SHOPIFY INC 2.9 9.5 1.9 6.4%
Slide 20: Toronto Portfolio
TORONTO PORTFOLIO e coutese sr. — wre JOINT VENTURE @ : e ancitanyPancinc @ IN : & * Little Italy DUNDAS ST. W. { e SPADINA AVE. King West ~@@@- Mei Senta a Business District . Liberty Village Sd Ee rea [ euorscunvwesr Pin 20 Market °° °° 1
Slide 21: Montréal Portfolio
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Slide 22: Vancouver Portfolio
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Slide 23: Calgary Portfolio
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Slide 24: Development Portfolio
ALLIED Development Portfolio 24
Slide 25: Development
DEVELOPMENT 15% SELF-IMPOSED LIMITATION ALLIED CREATES VALUE BY INTENSIFYING ON DEVELOPMENT THE USE OF UNDERUTILIZED LAND The cost of properties under development as a percentage of total assets on a proportionate basis(1) is limited to 15% 25.8M SF potential GLA which consists of: 14.3M SF of curre
Slide 26: Development Projects
DEVELOPMENT PROJECTS Current developments are expected to generate ~$98M of NOI ESTIMATED % OF OFFICE TRANSFER TO COST TO DEVELOPMENT RENTAL PORTFOLIO GLA ANNUAL NOI(2) COMPLETE PRE-LEASED THE WELL (1)(3) Q3 2022 – Q2 2025 744,000 $40.4M $5.9M 98% 19 DUNCAN – ORIGINAL 50% INTEREST (3) Q4 2023 – Q2 2
Slide 27: Future / Shadow Development Potential
FUTURE / SHADOW DEVELOPMENT POTENTIAL Total potential incremental density within Allied’s portfolio is ~9.8M SF POTENTIAL DENSITY FROM ZONING POTENTIAL INCREMENTAL DENSITY (1) COMPLETED OR IN PROGRESS (IN SQUARE FEET) (IN SQUARE FEET) 2,525,766 Le Nordeloc Lot E (127,450) 5,677,253 Adelaide & Spadin
Slide 28: Intensification
INTENSIFICATION Additional unexplored density potential not included in 9.8M SF. Here is an example of this. TORONTO | LIBERTY VILLAGE CASE STUDY Potential for incremental ~1.1M SF of density across commercial and residential assets unlocking ~$300M of equity value 840,000 1,356,484 64 Jefferson 190
Slide 29: Financial Strength
mls ALLIED Financial Strength 29
Slide 30: Financial Targets
FINANCIAL TARGETS – Maintain overall leverage below 35% and net debt—to—EBITDA below 9.0x – Maintain high portion of fixed rate debt over a well-staggered maturity profile – Maintain unencumbered property value at a minimum of 80% of total investment property value – Maintain ample liquidity by havi
Slide 31: Debt Structure
DEBT STRUCTURE Allied has a well-structured debt stack and benefits from a low weighted average interest rate. Allied has interest rate swaps on ~$871M of its variable rate debt which limits its exposure to fluctuations in interest rates. UNSECURED ($MILLIONS) Q4 2024 INTEREST RATE LIQUIDIY ($MILLIO
Slide 32: Debt Maturity Schedule
DEBT MATURITY SCHEDULE Manageable and well-laddered debt maturity platform with no more than 20% of debt expiring in any given year (1) $1,000,000 5.00% 4.46% $900,000 4.22% $800,000 3.86% 4.00% 3.72% $700,000 3.35% 3.10% INTEREST RATE $600,000 3.00% MILLIONS $500,000 2.28% $400,000 2.00% $300,000 $
Slide 33: Maximizing Flexibility While Strengthening the Balance Sheet
MAXIMIZING FLEXIBILITY WHILE STRENGTHENING THE BALANCE SHEET $12.0 100% 93% 87% 89% 90% $10.0 79% $9.8 80% $9.7 $9.5 $9.4 72% $9.1 $8.8 $8.8 70% $8.0 65% $8.3 $7.8 57% $7.6 60% BILLIONS $6.0 48% $6.5 $6.3 50% $5.6 $5.5 40% 40% $4.9 $4.0 $4.2 $4.3 30% $3.7 25% $2.9 20% $2.0 $2.3 $1.6 10% $0.8 $- 0% 2
Slide 34: Sources of Capital
SOURCES OF CAPITAL Allied has various sources of capital, including the following: EQUITY / ASSET SALES DEBT PARTNERSHIPS Capital recycling continues to be a Unsecured debt • Allied will seek to key source of liquidity opportunistically raise • Debentures equity capital when valuation • Strong priva
Slide 35: Market Highlights
ALLIED Market Highlights
Slide 36: Toronto Market Highlights
TORONTO MARKET HIGHLIGHTS EXPANDING ECONOMY FIXED SUPPLY OF OFFICE SPACE AS CONSTRUCTION HAS DECLINED TO CYCLICAL LOWS (M SF) 3.9% Population Growth in 2024 Source: Colliers 59K Net new jobs in 2024 7.8 8.2 7.4 -73% from 2019 1.1% Real GDP Growth 5.1 4.4 2.1 Source: Conference Board of Canada Q4 201
Slide 37: Montréal Market Highlights
MONTRÉAL MARKET HIGHLIGHTS EXPANDING ECONOMY FIXED SUPPLY OF OFFICE SPACE AS CONSTRUCTION HAS DECLINED TO CYCLICAL LOWS (M SF) 2.9% Population Growth in 2024 Source: Colliers -28K Net new jobs decline in 2024 4.1 -98% since 2019 1.0% Real GDP Growth 3.2 2.5 Source: Conference Board of Canada 1.5 1.3
Slide 38: Vancouver Market Highlights
VANCOUVER MARKET HIGHLIGHTS EXPANDING ECONOMY FIXED SUPPLY OF OFFICE SPACE AS CONSTRUCTION HAS DECLINED TO CYCLICAL LOWS (M SF) 4.3% Population Growth in 2024 Source: Colliers 22K Net new jobs in 2024 6.6 6.5 -52% since 2019 5.8 6.1 1.8% Real GDP Growth 3.7 3.2 Source: Conference Board of Canada Q4
Slide 39: Calgary Market Highlights
CALGARY MARKET HIGHLIGHTS EXPANDING ECONOMY VACANCY RATES CONTINUE TO LOWER FROM 2021 PEAK AS CALGARY DOWNTOWN OFFICE REBOUNDS 6.0% Population Growth in 2024 Source: Colliers -13% since 2021 35K Net new jobs in 2024 28.2% 31.9% 30.7% 29.5% 27.7% 26.3% 2% Real GDP Growth Source: Conference Board of C
Slide 40: Kitchener Market Highlights
KITCHENER MARKET HIGHLIGHTS EXCEPTIONAL TECH PRESENCE 18th ranked market in North America +46% tech job growth rate (2018-2023) 10% tech occupations as % of total employment Source: CBRE DRIVING WORKFORCE GROWTH & INNOVATION Top overall growth market in North America for residents in their 20s +29%
Slide 41: Environmental, Social & Governance (ESG)
Environmental, Social & Governance (ESG) 41
Slide 42: ESG Strategy
ESG STRATEGY FOCUS AREAS DECARBONIZATION ENVIRONMENTAL Reducing the environmental impact of our business activities by improving the efficiency and CLIMATE RESILIENCE resilience of our assets. BUILDING PERFORMANCE SOCIAL COMMUNITY IMPACT Enhancing employee and user experience and supporting the comm
Slide 43: ESG Highlights
ESG HIGHLIGHTS OUTPERFORMED PEERS IN USER EXPERIENCE ASSESSMENT COMMITTED TO SET SCIENCE-BASED EMISSIONS RATINGS SCORE REDUCTION TARGETS Sustained focus on user experience has led to an increase in Allied’s Net Allied has committed to set near- and long-term GHG emissions reduction targets, Promoter
Slide 44: Environmental
ENVIRONMENTAL FOCUS AREAS STRATEGY HIGHLIGHTS KEY NEXT STEPS • Finalize Allied's near-term NZC target and NZC Allied's Net Zero Carbon Plan is centered on four pathways in alignment with SBTi. pillars: development and redevelopment projects, DECARBONIZATION acquisition due diligence, operational ass
Slide 45: Social
SOCIAL FOCUS AREAS STRATEGY HIGHLIGHTS KEY NEXT STEPS • Develop guidelines that support user events to The guiding principles of Allied's community building achieve zero-waste and increase support for initiatives include preserving history, operating with local businesses. sensitivity and investing
Slide 46: An Integrated Governance Approach
AN INTEGRATED GOVERNANCE APPROACH OVERSIGHT RESOURCES & TOOLS KEY STAKEHOLDERS BOARD OF TRUSTEES ESG POLICY EMPLOYEES Reviews Allied's governance practices regularly and is responsible for overseeing Allied’s ESG Strategy and ESG initiatives, including the integration of sustainability into Allied's
Slide 47: Appendix
ALLIED Appendix
Slide 48: Certain Definitions and Non-GAAP Measures
CERTAIN DEFINITIONS AND NON-GAAP MEASURES Readers are cautioned that certain terms used in the investor presentation listed below, including any related per Unit amounts, used by Management of Allied to measure, compare and explain the operating results and financial performance of Allied do not hav
Slide 49: Adjusted EBITDA, Net Debt, Total Indebtedness
ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (“ADJUSTED EBITDA”) Adjusted EBITDA is a non-GAAP measure calculated on a proportionate basis comprised of earnings before interest expense, income taxes, depreciation and amortization expense (including amortization of improvem
Slide 50: Adjusted Funds from Operations (AFFO)
ADJUSTED FUNDS FROM OPERATIONS ("AFFO") AFFO is a non-GAAP financial measure used by most Canadian real estate investment trusts based on a standardized definition established by REALPAC in the White Paper. AFFO is defined as FFO less amortization of straight-line rent, regular leasing expenditures,
Slide 51: 134 PETER STREET, SUITE 1700 TORONTO, ONTARIO M5V 2H2 T 416.977.9002 F 416.306.8704
134 PETER STREET, SUITE 1700 TORONTO, ONTARIO M5V 2H2 T 416.977.9002 F 416.306.8704 ALLIEDREIT.COM
Allied Properties Real Estate Investment Trust — Q4 2024 Earnings Presentation on 6ix