Sunrise Senior Living — Investor Presentation (June 2011)
27 slides from Sunrise Senior Living's investor presentation, Jun 14, 2011
Slide 1: Investor Conference 2011
Investor Conference 2011 June 14, 2011
Slide 2: Disclaimer
Disclaimer • Some of the statements in this presentation, as well as statements made by management, may be forward-looking statements that are based on management’s current assumptions, expectations and projections regarding our business and performance, the economy and forecasts of future events, c
Slide 3: The Sunrise Story and Our Mission
The Sunrise Story and Our Mission Sunrise Founders Terry and Paul Klaassen witnessed 30 years ago how aging men and women had their dignity and choice taken away from them, simply because they needed extra assistance. They realized, from deep personal experience, that there were no options for senio
Slide 4: Sunrise Buildings Are Designed for Seniors
Sunrise Buildings Are Designed for Seniors The Sunrise-developed mansion was deliberately built with the needs of seniors in mind. Many of these design elements have been carried through to buildings we have acquired. • Homelike appeal, lush landscapingand residentialcharacter • Comfortableoutdoor a
Slide 5: Service Highlights
Service Highlights Premium product offering of resident-centered servicesfor seniors Second-largestproviderof assisted livingservicesin the country* Assisted Living (57%) An Individualized Service Plan of care is delivered by a team of designatedcare managers (DCMs) As careneeds increase, seniors ca
Slide 6: Sunrise Signature Experience
Sunrise Signature Experience Sunrise’s special touches and unique approach to personalized care are just part of what sets us apart. Some Highlights: We Create Relationship-Based Care Our designatedcare managersform rich relationshipsby getting to know our residents’preferences,from what time they l
Slide 7: Enriching the Mind, Body & Spirit
Enriching the Mind, Body & Spirit Our residents enjoy the very best in senior living from fulfilling activities to home-cooked meals– we stop at nothing to createa warm,enriching home. • Qualified team, led by a coordinator-level position focused solely on (He) mentioned that activities, offers seve
Slide 8: Consistent High-Quality Buildings
Consistent High-Quality Buildings *IL – Independent Living; AL – Assisted Living; TC – Terrace Club (early-stage memory care); REM – Reminiscence (advanced memory care); HC – Health Care/Skilled Nursing 8
Slide 9: Major Metropolitan Focus
Major Metropolitan Focus Communities Units % of % of # Total # Total Washington DC Metro 26 8.2 3,502 11.3 Market Greater Los Angeles 23 7.3 2,009 6.5 Market NY Metro Market 22 6.9 1,766 5.7 Greater Chicago Market 20 6.3 1,821 5.9 Greater London 14 4.4 1,145 3.7 Philadelphia Metro 13 4.1 1,509 4.9 M
Slide 10: Major Market Performance Over Time
Major Market Performance Over Time Big 6 Markets MAP31 Excl. Big 6 Markets* *Big 6 Markets include: New York, Boston, D.C., Chicago, No. California and So. California metro markets. NIC Map Source Data 10
Slide 11: High-Quality Business Relationships
High-Quality Business Relationships
Slide 12: Experienced Senior Management Team
Experienced Senior Management Team Management Team Name Title Years of Relevant Experience Years with Sunrise Mark S. Ordan Chief Executive Officer 25+ years 3+ years Greg Neeb Chief Investment & Administrative Officer 20+ years 3+ years Marc Richards Chief Financial Officer 15+ years 1+ year David
Slide 13: Attractive & Growing Market
Attractive & Growing Market Population of US Seniors Rising MM of US Population • Over 70MM seniors 65+ by 2040, making Growing Senior up 20% of the total US population Population • 85+ population projected to grow 3% annually over the next 40 years • Today’s seniors are healthier than in the Need f
Slide 14: Strong Rate Growth and Well Positioned for Occupancy Rebound
Strong Rate Growth and Well Positioned for Occupancy Rebound Same Community ADR Growth (1) Same Community Occupancy Change (1) (bps) % (bps) (%) 7 100 5-Year Average: 4.1% 5-Year Average: (76)bps 0 (500) 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 High-quality assets translate to consistently
Slide 15: SRZ vs. Large Chains (>25 Properties)
SRZ vs. Large Chains* (>25 Properties) Senior Housing Occupancy Senior Housing AMR 89.0% Chains 25+ SRZ $4,400 Chains 25+ SRZ 88.0% $4,200 $4,000 87.0% $3,800 86.0% $3,600 85.0% $3,400 $3,200 84.0% $3,000 83.0% $2,800 82.0% $2,600 1 2 3 4 1 2 3 4 1 1 2 3 4 1 2 3 4 1 2009 2010 2011 2009 2010 2011 *La
Slide 16: Significant Progress on Key Initiatives
Significant Progress on Key Initiatives Initiative Accomplishments Sunrise Snapshot Near finalization of new $50MM revolver Repaid bulk of consolidated debt Solidified Significantly reduced corporate recourse liabilities Restructured over $1B of debt in default (venture Balance Sheet and consolidate
Slide 17: Balance Sheet De-Risk
Balance Sheet De-Risk (dollars in thousands) Defaulted Debt at Total Debt at Current Total Debt at Proforma 6/30/2009 6/30/2009 Defaulted Debt 3/31/2011 3/31/2011 1) Wells Fargo 56,556 56,556 - - - Connecticut Avenue 39,703 39,703 - 28,010 28,010 Quebec - 43,837 49,269 48,147 48,147 Germany 190,213
Slide 18: Stabilize Revenue Stream – Management Contracts (Including JVs)
StabilizeRevenueStream– ManagementContracts(IncludingJVs) Portfolio/Partner Number of Average 2010 Fee Notes Communities Maturities ($ in 000s) Ventas 79 2034-2037 19,307 Entered into amended management Sunrise has agreements in 2010 restructured 4 HCPI 46 2028-2038 17,079 Litigation dismissed and s
Slide 19: Rationalize Cost Structure – G&A Completed Initiatives
Rationalize Cost Structure –G&A Completed Initiatives Corporate Costs 2007 2008 2009 2010 Q1 2011 G&A 183,546 150,273 114,566 124,728 32,389 Development Expense 35,076 34,118 12,374 4,484 - Liquidity Trust - - - - 407 Accounting Restatement/SEC 51,707 30,224 3,887 (1,305) - Restructuring - 24,178 32
Slide 20: Business Lines Over Time
Business Lines Over Time 2011 Q1 2011 Q1 2008 2010 Illustrative ¹ Ill. Annlzd. ¹ Revenue adjusted for EBITDA Management Fees 116.8 106.9 21.3 85.0 Professional fees from development, marketing, and other 44.2 4.3 0.3 1.2 2 Owned/Consolidated NOI (12.3) 12.6 23.6 94.3 Leased NOI 94.3 78.6 21.1 84.3 S
Slide 21: Ownership Mix Over Time
Ownership Mix Over Time - Illustrative assumes that Sunrise owned 100% of the AL US and CCIII ventures. Sunrise purchased the AL US joint venture in June 2011, and has the right to purchase 100% of the CC3 venture in 2013 subject to certain terms and conditions. 21
Slide 22: Attractive Growth Prospects
Attractive Growth Prospects Increase Community Income Buy-out JV Interests Focus on improving operating efficiency Proprietary deal flow Provide additional revenue-generating Maximizes benefit from improved services at existing communities performance of communities Selectively expand existing facil
Slide 23: CNL Lifestyle – CC3 Investment Summary
CNL Lifestyle –CC3 Investment Summary Jan 2011, Sunrise contributed its 10% interest in an CC3 Portfolio Investment existing JV (CC3) for a 40% interest in a new JV with Summary 2011B 2013B* CNL Lifestyle Properties Revenues $ 157,138 $ 166,707 Less: Exp. $(101,294) $(107,463) – 29 asset / 2,028 uni
Slide 24: AL US Investment Summary
AL US Investment Summary June 2011, Sunrise bought out its partner’s 80% share in AL US Portfolio Investment Summary 2011B an existing JV and restructured the JV debt. Revenues $ 84,802 Less: Exp. $ (51,976) – 15 asset /1,091 unit portfolio; high-quality purpose- Less: Mgmt. (7%) $ (5,936) built man
Slide 25: Capital Structure
Capital Structure Capitalization (1) Debt Maturity Schedule (1) ($MM) ($MM) 448.4 Equity: 400 Equity Market Capitalization (2) 474.6 Debt: 80 Recourse Debt 85.5 Non-recourse Debt (1) 409.0 Convertible Debt 86.3 60 57.9 Total Pro Forma Debt 580.8 48.1 Total Capitalization 1,055.4 40 Less: Cash & Cash
Slide 26: Company Highlights
Company Highlights Premium product offering of resident-centered services for seniors Leading Provider of High-quality, purpose-built assets located in top metropolitan markets Senior Living Services Sector leading brand, reputation and senior living expertise Significant relevant experience in the
Slide 27: Appendix: Reconciliation of non-GAAP measure
Appendix: Reconciliation of non–GAAP measure The following table reconciles adjusted EBITDA, less discontinued business lines, to net income (loss) attributable to common shareholders (in millions): 2008 2010 Total Adj. EBITDA Less Discontinued Business Lines (26.9) 49.0 Plus: Discontinued Business
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