Stag Industrial, Inc. · NYSE:STAG
Stag Industrial — Investor Presentation (September 2023)
23 slides from Stag Industrial's investor presentation, Sep 11, 2023
Slide 1: STAG Industrial Fall 2023 Investor Presentation
STAG INDUSTRIAL Fall 2023 Investor Presentation
Slide 2: Forward-Looking Statements & Definitions
FORWARD-LOOKING STATEMENTS & DEFINITIONS Forward-Looking Statements This presentation contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. STAG Industrial, Inc. (“S
Slide 3: Thoughtful Approach to Industrial Real Estate
THOUGHTFUL APPROACH TO INDUSTRIAL REAL ESTATE is an owner and operator of industrial real estate Platform able to address a large opportunity in an attractive asset class Only pure-play industrial REIT active across the entire domestic Relative value investment strategy driven by a robust industrial
Slide 4: Portfolio Growth & Quality
PORTFOLIO GROWTH & QUALITY IPO Era 1 Q4 2015 TODAY 2 Portfolio Sq. Ft. (millions) 14.2 54.7 111.1 Properties 93 291 558 Portfolio Growth Number of states 26 38 41 IPO Era Q4 2015 TODAY Prim. and sec. market exp. by % ABR 74.1% 87.6% 96.6% Flex/office exposure (% of ABR) 21.1% 3.9% 0.1% Portfolio Qua
Slide 5: Portfolio Optimization & Balance Sheet
PORTFOLIO OPTIMIZATION & BALANCE SHEET IPO Era 1 Q4 2015 TODAY 2 WA portfolio escalators 1.25% ~ 1.75% > 2.50% Cash Rent Change 4.7% 1.6% ~ 30% Internal Growth Straight-Line Rent Change 6.1% 7.1% > 35% Optimization Same Store Cash NOI growth No 0.6% 5.0% + Growth IPO Era Q4 2015 TODAY Equity Market
Slide 6: Building Blocks of Growth
BUILDING BLOCKS OF GROWTH HISTORICAL TREND 2023 GUIDANCE NOTES Average Same Store Cash NOI growth of ~2% over past Same Store Cash NOI growth of 5.00% - 5.25% Expect recent Same Store Cash NOI growth to be eight years • Retention range of 70 – 75% sustainable, driven by increase in rental escalators
Slide 7: Operational Expertise Focused on Maximizing Cash Flow
OPERATIONAL EXPERTISE FOCUSED ON MAXIMIZING CASH FLOW REGIONAL ASSET MANAGEMENT Operational supported by local brokers on all new expertise allows and renewal leasing transactions STAG to pursue and acquire value-add opportunities CUSTOMER SOLUTIONS GROUP with corporate and portfolio wide context to
Slide 8: Multi-Faceted Approach to Creating Value
MULTI-FACETED APPROACH TO CREATING VALUE CASE STUDIES: VALUE ADDED THROUGH OPERATIONS Multi-Site Value Creation – Northern IN Early Termination – Livonia, MI Development – Sacramento, CA Acquired the building in October 2020 Tenant was set to expire in April 2023 and was a known Acquired December 20
Slide 9: Demand Dynamics: Ecommerce Activity and Supply Chain Configuration
DEMAND DYNAMICS: ECOMMERCE ACTIVITY AND SUPPLY CHAIN CONFIGURATION E-commerce and supply ~31% of STAG’s portfolio handles chain reconfiguration US has meaningful incremental e- e-commerce activity (1) providing secular commerce runway based on historical demand drivers UK rate E-Commerce Retail Sale
Slide 10: Demand Dynamics: Nearshoring & Onshoring
DEMAND DYNAMICS: NEARSHORING & ONSHORING Accelerating re-shoring and near-shoring trends continue to drive domestic warehouse space demand Approximately 30% of STAG’s portfolio is located within 60-mile radius of Megasite Projects1 STAG SF (in Millions) 0.0-0.5 0.5-1.0 1.0-2.1 2.1-5.3 5.3-10.4 Megas
Slide 11: Broad Based Opportunity Set, Large Target Market
BROAD BASED OPPORTUNITY SET LARGE TARGET MARKET U.S. industrial market is more than $1 trillion in total size1 $1 Trillion Total Industrial Market1 STAG’s opportunity set spans the top 60+ 0.7% markets in the U.S. Relative value investment strategy across all fungible industrial markets enhances val
Slide 12: Process Driven Approach to Address Attractive Opportunity
PROCESS DRIVEN APPROACH TO ADDRESS ATTRACTIVE OPPORTUNITY Value created via granular approach to acquisitions across a broad opportunity ACQUISITION set – relative value investment strategy employed with portfolio premium value created upon acquisition PIPELINE $4.0 Benefit from relationships with r
Slide 13: Emphasis on Diversification
EMPHASIS ON DIVERSIFICATION Portfolio spans 60+ markets ATTENTION TO DIVERSIFICATION REDUCES RISK AND Largest market exposure is only 7% of ABR ENHANCES VALUE Portfolio includes exposure to 45+ industries PORTFOLIO WIDELY DIVERSIFIED ACROSS GEOGRAPHY, Largest tenant is less than 3% of ABR TENANT, IN
Slide 14: Sophisticated and Diverse Tenant Base
SOPHISTICATED AND DIVERSE TENANT BASE In-depth tenant credit analysis and ongoing Dedicated credit analysis team Focus on industrial real estate results credit monitoring including two CFA charter holders in larger and thus more sophisticated tenants TOP TENANT LESS THAN 3% OF ABR TOP 20 TENANTS < 2
Slide 15: Balance Sheet Discipline
BALANCE SHEET DISCIPLINE CONSERVATIVE BALANCE SHEET POSITIONED TO SUPPORT GROWTH Conservative Capitalization Fixed Rate (in $ millions) Borrower (1) $8 - Secured Debt 8.8% 0.1% Floating (revolving credit facility only) $2,441 Unsecured Debt $6,594 27.0% Common Equity at 91.2% Market Value Fixed Rate
Slide 16: Compelling Valuation
COMPELLING VALUATION Growing Income Value Creation Low Risk • Internal growth with long history of • Attractive asset class that is difficult to aggregate • Widely diversified portfolio across success managing portfolio geography, tenancy, industry, lease • Granular investment approach to identify r
Slide 17: ESG - Environmental
ESG - ENVIRONMENTAL GREEN LEASE LEADERS AWARD RECIPIENT SOLAR PANEL INSTALLATION Recognizes forward-thinking companies that utilize energy Leverage rooftop square footage to create clean energy efficient and sustainable leases Gold level since 2020 Twelve installations totaling 25.6 MW completed Fou
Slide 18: ESG - Social and Governance
ESG - SOCIAL AND GOVERNANCE SOCIAL RESPONSIBILITY GOVERNANCE Focus on efforts supporting children, young adults, equality, Diverse board (30% women and minorities with lead and social justice across the U.S. independent director) Shareholder friendly bylaws including majority voting and Support prov
Slide 19: Appendix
INDUSTRIAL APPENDIX
Slide 20: Non-GAAP Financial Measures & Other Definitions
NON-GAAP FINANCIAL MEASURES & OTHER DEFINITIONS Acquisition Capital Expenditures: We define Acquisition Capital Expenditures as capital expenditures identified at the time of acquisition. Acquisition Capital Expenditures also include new lease commissions and tenant improvements for space that was n
Slide 21: Non-GAAP Financial Measures & Other Definitions
NON-GAAP FINANCIAL MEASURES & OTHER DEFINITIONS Earnings before Interest, Taxes, Depreciation, and Amortization for Real Estate (EBITDAre), Adjusted EBITDAre, Annualized Adjusted EBITDAre, Run Rate Adjusted EBITDAre, and Annualized Run Rate Adjusted EBITDAre: We define EBITDAre in accordance with th
Slide 22: Non-GAAP Financial Measures & Other Definitions
NON-GAAP FINANCIAL MEASURES & OTHER DEFINITIONS However, because FFO and Core FFO exclude, among other items, depreciation and amortization and capture neither the changes in the value of our buildings that result from use or market conditions of our buildings, all of which have real economic effect
Slide 23: Non-GAAP Financial Measures & Other Definitions
NON-GAAP FINANCIAL MEASURES & OTHER DEFINITIONS Renewal Lease: We define a Renewal Lease as a lease signed by an existing tenant to extend the term for 12 months or more, including (i) a renewal of the same space as the current lease at lease expiration, (ii) a renewal of only a portion of the curre
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