Granite Real Estate Investment Trust · TSX:GRT.UN
Granite Real Estate Investment Trust — Investor Presentation (August 2020)
20 slides from Granite Real Estate Investment Trust's investor presentation, August 2020
Slide 1: Investor Presentation | August 2020
INVESTOR PRESENTATION | August 2020 INVESTOR PRESENTATION | August 2020
Slide 2: Presentation of Certain Information
PRESENTATION OF CERTAIN INFORMATION • Unless otherwise indicated in this presentation, all information is presented as of June 30, 2020 and all financial information that is identified as current refers to the period ending June 30, 2020. For definitions of certain non-IFRS measures used in this pre
Slide 3: Granite Highlights
GRANITE HIGHLIGHTS ORGANIZATIONAL PRINCIPLES PORTFOLIO OVERVIEW FINANCIAL PERFORMANCE Long-term total return focused 97 income-producing properties + 7 77% LTM AFFO POR development properties/land Conservative and flexible capital 23% net leverage ratio 45.2M square feet structure GRT.UN on TSX and
Slide 4: Granite Highlights - ESG
GRANITE HIGHLIGHTS - ESG ENVIRONMENTAL SOCIAL GOVERNANCE Promote energy efficiency and sustainable practices at our Promote employee well-being 100% independent Board properties excluding CEO Reduce use of resources and promote waste diversion Promote volunteerism and Experienced and diverse board c
Slide 5: Granite's Evolution
GRANITE’S EVOLUTION Investment Property Summary Then - December 31, 2011 Now - June 30, 2020 29.5M SF 13.8M SF Modern 14.1M SF Logistics/Distribution Multi-Purpose Special Purpose $3,210M $802M $1,089M 6.8M SF $1.9B Multi-Purpose $871M $5.3B Value Value 3 Properties Under Development and 3 Land 8.9M
Slide 6: Portfolio Transformation Strategy
PORTFOLIO TRANSFORMATION STRATEGY Invest selectively/opportunistically in Target markets with superior Focus on modern facilities that meet evolving property types and markets economic conditions and market the demands of E-Commerce and benefiting from technological fundamentals traditional distribu
Slide 7: Financial Performance
FINANCIAL PERFORMANCE Historical Operating Performance ($M) Distributions and Payout Ratios $302 91% 82% 81% $274 78% 71% $245 $248 $235 $223 79% 73% $214 $216 78% 78% $203 $204 2.90 $198 71% $188 $187 68% 2.80 $183 $185 69% 68% $181 2.72 $170 $173 2.60 $158 $162 $154 $143 $145 2.43 $138 2.30 2.21 2
Slide 8: GRT Historical Performance
GRT HISTORICAL PERFORMANCE Total Return vs TSX Composite & TSX Capped REIT Indices Cumulative Total Return % Annualized Total Return % COVID-19 25% 220% 20% 195% 15% 170% 10% 145% 5% 120% 0% 95% 70% -5% 45% -10% 20% -15% -5% -20% 1Yr 2Yr 3Yr 5Yr Granite REIT TSX Capped REIT Index TSX Composite Index
Slide 9: Globally Diversified Portfolio
GLOBALLY DIVERSIFIED PORTFOLIO Nine countries – 104 properties – 45.2 million square feet GERMANY 11 properties ENGLAND 3.5M SF POLAND 1 property 2 properties 0.1M SF 0.3M SF CANADA 26 properties 5.9M SF NETHERLANDS 8 properties 2.4M SF UNITED STATES 43 properties 24.5M SF CZECH REPUBLIC AUSTRIA 1 p
Slide 10: Portfolio Segmentation by Geography
PORTFOLIO SEGMENTATION BY GEOGRAPHY By Income Producing Property Fair Value By Annualized Revenue $47.9M $51.2M $805M 16% 20% $1,009M 16% 17% $827M 16% $5.1B $64.4M 22% $297M $2,494M $133.6M 45% 49% By Square Feet By Number of Income-Producing Properties 6.7 15% 13% 5.9 21 26 22% 27% 18% 45.2M 11 11
Slide 11: Portfolio Segmentation by Category
PORTFOLIO SEGMENTATION BY CATEGORY Income-Producing Properties by Value Segmented by Category Multi-Purpose Properties 36 Properties 6.8 M SF (∼190K SF/property) $0.9 B Fair Value (∼$128/SF) WALT: 5.0 years $54.4M Annualized Revenue (∼$7.96/SF): 18% 17% Modern Logistics Properties Magna Concentratio
Slide 12: Development Pipeline
DEVELOPMENT PIPELINE Tilburg, Ede(1) and Weert, Netherlands Plainfield, Indiana Bleiswijk, Netherlands Houston, Texas Incorporate development into our growth plans to enhance total return & platform value August 2020 12 (1) The Tilburg and Ede properties were acquired on July 1, 2020.
Slide 13: Lease Expiration Profile
LEASE EXPIRATION PROFILE Outstanding Lease Expiries by Annualized Revenue Annualized Overall Revenue $297M WALT 6.2 Years Occupancy 99.1% 43.0% 80 Canada USA Austria Europe 70 Annualized Revenue (C$M) 60 50 21.4% 40 11.2% 13.1% 30 3.0% 7.4% 20 0.8% 10 0 2020 2021 2022 2023 2024 2025 2026+ % of Annua
Slide 14: High Quality & Creditworthy Tenant Base
HIGH QUALITY & CREDITWORTHY TENANT BASE Other Tenants Annualized Credit Top 10 Tenants GLA % WALT Revenue % Rating Magna 39% 31% 4.9 A (low) Amazon 7% 5% 18.6 AA- ADESA 3% —% 9.1 NR Restoration Hardware 2% 3% 7.8 NR Hanon Systems 2% 1% 9.1 BBB (low) Ingram Micro 2% 2% 4.5 AA Mars Petcare 2% 3% 1.8 N
Slide 15: Balance Sheet Strength
BALANCE SHEET STRENGTH Capitalization Debt Maturity Profile Unit Price (07/31/2020) $77.90 Units Outstanding 57.8 $600 499 500 Market Capitalization $4,503 $500 400 $400 Credit Facility $0 300 $300 250 262 (C$M) Debentures 3.788% due Jul/21 $250 Debentures 3.873% due Nov/23 $400 $200 Debentures 3.06
Slide 16: Credit Metrics Summary
CREDIT METRICS SUMMARY • The following table was sourced from DBRS’ Canadian Real Estate Peer Comparison dated June 2020. DBRS Canadian Real Estate Peer Comparison1: Peer Group Granite Rank Granite Average Among Peer Group Total Debt to Capital 27.4% 48.7% #1 Total Debt to EBITDA 5.6x 9.2x #1 Cash F
Slide 17: Financial Flexibility & Target Long-Term Leverage Ratio
FINANCIAL FLEXIBILITY & TARGET LONG-TERM LEVERAGE RATIO • Strong balance sheet provides pathway for measured growth with potential for further diversification and optimization of the portfolio • Target long term net leverage ratio of ∼30 - 35% while maintaining patient and opportunistic approach to
Slide 18: Canadian Real Estate Debt Comparison
CANADIAN REAL ESTATE DEBT COMPARISON1 Total Debt-to-Capital Total Debt-to-EBITDA 80% 18.0x 16.0x 70% 14.0x 60% 12.0x 50% 10.0x 8.0x 40% 6.0x 30% 4.0x 20% 2.0x 10% 0.0x Granite has the lowest leverage within DBRS1 universe of Canadian Real Estate entities 1 Source: DBRS Canadian Real Estate Peer Comp
Slide 19: Canadian Real Estate Debt Comparison
CANADIAN REAL ESTATE DEBT COMPARISON1 EBITDA Interest Coverage Distributions/Cash Flow from Operations2,3 8.0x 1.20 7.0x 1.00 6.0x 0.80 5.0x 4.0x 0.60 3.0x 0.40 2.0x 0.20 1.0x 0.0x 0.00 Granite has leading cash flow coverage metrics among DBRS1 universe of Canadian Real Estate entities 1 Source: DBR
Slide 20: Leadership Team
LEADERSHIP TEAM Kevan Gorrie Teresa Neto • President and Chief Executive Officer • Chief Financial Officer • Over 20 years of real estate experience in Canada, • Over 30 years of varied business experience, the United States and Germany. including ∼10 years as a CFO for publicly-traded • Previously
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