First Industrial Realty Trust, Inc. · NYSE:FR
First Industrial Realty Trust — Bank of America Merrill Lynch 2019 Global Real Estate Conference
41 slides from First Industrial Realty Trust's conference presentation, September 2019
Slide 1: Bank of America Merrill Lynch 2019 Global Real Estate Conference
BANK OF AMERICA MERRILL LYNCH 2019 GLOBAL REAL ESTATE CONFERENCE SEPTEMBER 2019
Slide 2: Safe Harbor
SAFE HARBOR This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. We intend for such forward-looking statements to be covered by the safe harbor provisions for forward-looking sta
Slide 3: Recent Highlights
RECENT HIGHLIGHTS (1) • Cash rental rates up 13.4%; highest quarterly increase in our 25-year history • Occupancy 97.3%, up 40 basis points from 2Q18 • Cash same store NOI grew 3.0% • Signed 1.7 MSF of new leases for development and value-add acquisitions in 2Q19; In 3Q19, leased 100% of the 120,000
Slide 4: Strategy for Success
STRATEGY FOR SUCCESS Maximize the economics on every lease Focus on higher rent growth assets and markets Continue to reduce allocation to low barrier markets Emphasize development as long as yields and demand justify Maintain balance sheet discipline 4
Slide 5: Industrial Real Estate Demand Drivers
INDUSTRIAL REAL ESTATE DEMAND DRIVERS GDP Growth Supply Chain Consumption Optimization Global E-Commerce Trade 5
Slide 6: Portfolio and Platform
PORTFOLIO AND PLATFORM AS OF JUNE 30, 2019 Square Footage Percentage by Property Type of Rental Income(1) 0.7% Seattle Bulk Warehouse Minneapolis/St. Paul Central/Eastern PA 75% 6.0% Milwaukee Detroit 1.1% 3.2% New Jersey 1.7% 8.6% 5.4% 6.9% Chicago Northern California 3.4% Cleveland 0.7% 5.1% 4.5%
Slide 7: Portfolio Transformation Summary
PORTFOLIO TRANSFORMATION SUMMARY AS OF JUNE 30, 2019 Key Portfolio Statistics(1) 12/31/09 6/30/19 %Δ Number of Properties 783 454 (42%) Number of Tenants 1,993 1,190 (40%) Average Building Size (KSF) 89 136 53% Average Tenant Size (KSF) 28 50 79% 2000 $337M / 4.5 MSF $65M 1600 Developments In Proces
Slide 8: Portfolio Proximity to Population Centers
PORTFOLIO PROXIMITY TO POPULATION CENTERS Average Population FR Portfolio > 1M Median % of FR Portfolio Average Household by SF Population Income 10 miles 23% 0.7M $62,658 20 miles 75% 2.2M $63,110 30 miles 95% 3.7M $64,497 2018 U.S. Average $58,100 Proximity to higher income population centers fits
Slide 9: Key Portfolio Cash Flow Metrics
KEY PORTFOLIO CASH FLOW METRICS 13.0% cash rental rate change on 83% of 2019 rollovers signed as of July 24, 2019 Occupancy %(1) Cash Rental Rates %(2) Cash Same Store NOI %(3) 100 15 10 13.4 98.5 97.3 97.3 6.1 10 5.8 8.6 5.2 96.1 96.0 8.1 5 4.2 4.4 6.6 2.7 3.0 94.3 5 3.5 92.9 2.2 0 '13 '14 '15 '16
Slide 10: Financial Performance
FINANCIAL PERFORMANCE FFO Per Share (1) AFFO (2) Dividend Per Share (3) (millions) $1.00 $1.75 $175 $167.5 $0.92 CAGR 8.2% CAGR 17.5% $156.3 $0.87 CAGR 18.0% $1.60 $0.84 $150 $1.56 $0.76 $132.5 $0.75 $1.50 $1.45 $125 $112.8 $1.34 $100 $94.5 $0.51 $1.25 $0.50 $1.16 $74.8 $0.41 $75 $1.08 $0.34 $1.00 $
Slide 11: U.S. Net Absorption and New Completions
U.S. NET ABSORPTION AND NEW COMPLETIONS CBRE-EA FORECAST HAS UNDERESTIMATED DEMAND MINIMAL E-COMMERCE TAILWIND FOR SEVERAL YEARS 400 300 200 100 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 -100 -200 1H19 NET ABSORPTION 72 MSF COMPLETIONS 92 MSF -3
Slide 12: Investment Activity
INVESTMENT ACTIVITY
Slide 13: Developments Under Construction
DEVELOPMENTS UNDER CONSTRUCTION AS OF JUNE 30, 2019 First Aurora First Park @ Central Crossing III Commerce Center – Bldg. D 119,808 SF First Perry Logistics Center 555,840 SF Estimated Completion: 3Q19 First Redwood Logistics 240,247 SF Estimated Completion: 3Q19 Center – I & II Estimated Completio
Slide 14: Developments Under Construction
DEVELOPMENTS UNDER CONSTRUCTION AS OF JUNE 30, 2019 Estimated GAAP Estimated % Estimated Property Market SF Investment $/SF Cash Leased Completion ($M) Yield(1) First Aurora Commerce Denver 555,840 38.3 69 0% 7.2% 3Q19 Center – Building D First Park Fairburn - BTS Atlanta 703,080 40.4 57 100% 6.0% 3
Slide 15: First Aurora Commerce Center – Bldg. D
FIRST AURORA COMMERCE CENTER – BLDG. D DENVER Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 555,840 $38.3M $69 7.2% 0% 3Q19 15
Slide 16: First Park Fairburn - BTS
FIRST PARK FAIRBURN - BTS ATLANTA Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 703,080 $40.4M $57 6.0% 100% 3Q19 16
Slide 17: First Park @ Central Crossing III
FIRST PARK @ CENTRAL CROSSING III SOUTHERN NEW JERSEY Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 119,808 $12.7M $106 6.4% 100% 3Q19 17
Slide 18: First Park 121 – Buildings I & II
FIRST PARK 121 – BUILDINGS I & II DALLAS Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 345,280 $27.5M $80 7.1% 18% 4Q19 (2 Buildings) 18
Slide 19: First Perry Logistics Center
FIRST PERRY LOGISTICS CENTER INLAND EMPIRE Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 240,247 $20.5M $85 5.9% 100% 4Q19 19
Slide 20: HD Supply BTS @ PV 303
HD SUPPLY BTS @ PV 303 PHOENIX Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 50,184 $7.7M $153 5.7% 100% 4Q19 20
Slide 21: First Mountain Creek - BTS
FIRST MOUNTAIN CREEK - BTS DALLAS Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 863,328 $52.5M $61 5.7% 100% 4Q19 21
Slide 22: First Fossil Creek Commerce Center
FIRST FOSSIL CREEK COMMERCE CENTER DALLAS Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 198,589 $12.4M $62 7.0% 0% 4Q19 22
Slide 23: First Grand Parkway Commerce Ctr. I & II
FIRST GRAND PARKWAY COMMERCE CTR. I & II HOUSTON Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 370,660 $28.5M $77 7.7% 15% 4Q19 (2 Buildings) 23
Slide 24: Ferrero BTS @ PV 303
FERRERO BTS @ PV 303 PHOENIX Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 643,798 $48.6M $75 6.6% 100% 4Q19 24
Slide 25: First Redwood Logistics Center I & II
FIRST REDWOOD LOGISTICS CENTER I & II INLAND EMPIRE Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 402,287 $47.4M $118 6.0% 0% 1Q20 (2 buildings) 25
Slide 26: First Independence Logistics Center
FIRST INDEPENDENCE LOGISTICS CENTER PHILADELPHIA 3Q Development Announcement Est. GAAP Est. % Estimated SF $/SF Investment Cash Yield Leased Completion 100,167 $12.3M $123 6.1% 0% 2Q20 26
Slide 27: Developments Completed Not In-Service
DEVELOPMENTS COMPLETED NOT IN-SERVICE AS OF JUNE 30, 2019 First Logistics Center @ First Joliet Logistics Center I-78/81 – Bldg A 355,969 SF 738,720 SF First Logistics Center @ I-78/81 – Bldg B 250,200 SF First Glacier Logistics Center 66,751 SF First 290 @ Guhn Rd 126,250 SF 27
Slide 28: Developments Completed Not In-Service
DEVELOPMENTS COMPLETED NOT IN-SERVICE AS OF JUNE 30, 2019 Estimated GAAP Estimated % Building Property Market SF Investment $/SF Cash Leased Completion ($M) Yield(1) First Logistics Center @ Central PA 738,720 53.1 72 100% 6.6% 4Q18 I-78/81 – Building A First Logistics Center @ Central PA 250,200 17
Slide 29: Developments Placed In-Service
DEVELOPMENTS PLACED IN-SERVICE 2018/2019 First Sycamore 215 Logistics Center The Ranch by First Industrial – First Nandina Logistics Center 242,580 SF First Park 94 – Building II Building I 1,387,899 SF 602,348 SF 49,571 SF The Ranch by First Industrial – Building II 155,742 SF First Park @ PV 303 –
Slide 30: Developments Placed In Service
DEVELOPMENTS PLACED IN SERVICE 2018/2019 Estimated GAAP Placed % Cash Property Market SF Investment $/SF In Service Leased Yield(1) ($M) Date First Sycamore 215 Inland 242,580 18.1 75 100% 6.6% 1Q18 Logistics Center Empire First Park 94 – Building II Chicago 602,348 30.6 51 100% 8.4% 2Q18 The Ranch
Slide 31: Property Acquisitions
PROPERTY ACQUISITIONS 2018/2019 1402 Puyallup Street 56,336 SF 6407 S 210th St 35,132 SF First Orchard 88 Business Center 172,654 SF 21110 E 31st Circle 84,700 SF 28545 Livingston Ave 170,556 SF First Park @ Central Crossing II 119,922 SF Mahalo & Maria 31,900 SF 930 Columbia Ave 43,550 SF 4401 Shad
Slide 32: Property Acquisitions
PROPERTY ACQUISITIONS 2018/2019 Purchase Price Estimated Property Market SF $/SF % Leased(3) ($M) Cash Yield(1) 6407 S. 210th St Seattle 35,132 5.6 159 100% 5.7% First Park @ Ocean San Diego 225,489 36.7 163 100% 5.4% Ranch II 4401 Shader Rd Orlando 93,608 8.7 93 100% 5.7% 28545 Livingston Ave Los A
Slide 33: First Park @ PV 303 – Joint Venture
FIRST PARK @ PV 303 – JOINT VENTURE • Acquisition of 532 net acres at PV 303 Business Park in Phoenix • $49M (≈ $2 per land foot), FR share: 49% • Partner: Diamond Realty, the US real estate arm of Mitsubishi Corporation • Speculative and build-to-suit development plus one-off land sales to users •
Slide 34: First Park @ PV 303 – Joint Venture
FIRST PARK @ PV 303 – JOINT VENTURE 269 Acres Remaining JV Land After Sales 34
Slide 35: Strategically Located Land Positions
STRATEGICALLY LOCATED LAND POSITIONS AS OF JUNE 30, 2019 Site Market Acres Developable SF PV 303 - JV Land Phoenix 269.5 4,226,500 First Park 94 Chicago 154.0 3,200,000 First Aurora Commerce Ctr. Denver 93.6 1,334,000 Pennsylvania First Rockdale IV Nashville 101.7 1,200,000 Chicago First Park Arch R
Slide 36: Balance Sheet
BALANCE SHEET
Slide 37: Line of Credit/Term Loans Covenants
LINE OF CREDIT/TERM LOANS COVENANTS (DEBT + PREFERRED) TO EBITDA TOTAL LEVERAGE(1) (annualized) 6.5 45 6.2x 40.6% 6.1x 40 37.5% 6.0 5.5x 35 33.0% 5.5 30 4.9x 4.9x 27.6% 5.0 25.9% 26.7% 4.7x 25 4.5 2014 2015 2016 2017 2018 2Q19 2014 2015 2016 2017 2018 2Q19 SECURED LEVERAGE FIXED CHARGE COVERAGE 20.0
Slide 38: Strong Balance Sheet
STRONG BALANCE SHEET AS OF JUNE 30, 2019 Fixed vs. Floating Fixed 89% Floating 11% Amount Interest Weighted Debt Type ($M) % Rate Maturity (Yrs.)(1) Secured 222 16 5.1% 2.6 Unsecured 1,167 84 3.8% 5.8 Total 1,389 4.0% 5.3 (1) LOC maturity assumes exercise of one-year extension option. 38
Slide 39: Strong Balance Sheet
STRONG BALANCE SHEET AS OF JUNE 30, 2019 Maturities Secured Debt Unsecured Debt Line of Credit 600 500 (2) 400 158 $M 300 549 200 260 200 100 4 59 (1) 67 82 0 10 2019 2020 2021 2022 Thereafter Average Interest 6.10% 6.90% 3.75% 3.27% 4.39% Rate % (1) The Company plans to pay off $33M of this debt in
Slide 40: Why First Industrial?
WHY FIRST INDUSTRIAL? Cash flow growth opportunity Ability to create value through development and select acquisitions via platform Valuation gap to peers and market transactions 40
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