Udr, Inc. · NYSE:UDR
Udr — United Dominion Realty Trust — Investor Presentation (August 2006)
36 slides from Udr's investor presentation, Aug 23, 2006
Slide 1: UDR | United Dominion Realty Trust Investor Presentation
UDR | United Dominion Realty Trust The Value of our real estate is Our Team’s Ability to Create Opportunities. Investor Presentation August 2006
Slide 2: Safe Harbor Statement
Statements contained in this presentation, which are not historical facts, are forward-looking statements, as the term is defined in the Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by the Company's use of words such as, "expects," "plans," "est
Slide 3: UDR Overview
4th Largest Apartment REIT Approximately 75,000 apartment homes $7.7 billion total market cap Portfolio positioned to capture job and demographic trends Proven Record of Delivering Shareholder Return: Year to Date: 24% 2 Years: 27% 5 Years: 22% 10 Years: 16% 30 consecutive years of dividend increase
Slide 4: UDR Overview: Broad Based Capabilities to Create Value
UDR Overview We have broad based capabilities to create value in many ways: Operations Acquisitions Dispositions Development Redevelopment
Slide 5: UDR Overview: Management Team
UDR Overview Management Team We have a strong, experienced team: Average tenure with UDR for the top 50 leadership positions in Operations is over 7 years Improved associate turnover from 60% in 2001 to just over 36% in 2006
Slide 6: Our Holdings as of August 2006
Top States for 2006 Projected Net Operating Income* California: 26% Florida: 14% Metro D.C.: 14% Texas: 12% North Carolina: 10% Our Holdings as of August 2006 UDR - Operations *ProForma for acquisitions and dispositions under contract **Source: Economy.com
Slide 7: Acquisitions and Dispositions: Five Year Overview
Summary - Five Year Overview 2006 Dispositions reflects $277MM of properties under contract or under agreement to close in the second half of the year 2005 Dispositions includes $69MM in condo sales, 2006 Dispositions includes $58MM in condo sales We have sold over 38% of the portfolio since 2001 We
Slide 8: Acquisitions and Dispositions: Five Year Overview
Summary - Five Year Overview 2006 Dispositions reflects $277MM of properties under contract or under agreement to close in the second half of the year 2005 Dispositions includes $69MM in condo sales, 2006 Dispositions includes $58MM in condo sales We have sold over 38% of the portfolio since 2001 We
Slide 9: 2006 Second Quarter Results
Rents & Reimbursements Per occupied home = $878 Up $47 over prior year Up 5.4% over prior year Occupancy 94.9% - Up 40 bps over prior year Highest level in over four years Concessions Down 11.1% vs. prior year Expenses Up 2.9% over prior year Bottom Line NOI Up 8.0% over prior year 2006 Second Quart
Slide 10: Same Store Year Over Year Growth
Same Store Year Over Year Growth UDR - Operations Revenue NOI Recent Growth Rates are the Highest in over 6 Years
Slide 11: UDR - Operations: Technology
UDR - Operations The Internet makes it easy to do business with us Shop for and reserve apartment, screen for credit, complete application Resident portal for on-line service requests available 4Q2006 Investigating pricing software such as LRO and Yield Star to enable dynamic internet pricing Cost t
Slide 12: 2006 Summary UDR - Acquisitions
2006 Summary UDR - Acquisitions
Slide 13: Canyon Oaks - San Ramon, CA
New Community in San Ramon, CA Built in 2005 250 Homes - $225K Per Home 5.0% Return, $1,516 Avg. Rent May Become Condo Conversion Canyon Oaks UDR - Acquisitions UDR - Acquisitions UDR - Acquisitions
Slide 14: Mill Creek - San Ramon, CA
New Community in San Ramon, CA Built in 2006 400 Homes - $225K Per Home 5.0% Return, $1,498 Avg. Rent Mill Creek UDR - Acquisitions
Slide 15: Milazzo - San Diego, CA
Community in San Diego, CA Built in 1986 250 Homes - $207K Per Home 4.3% Return, $1,268 Avg. Rent May Become Condo Conversion or K/B Upgrade Milazzo UDR - Acquisitions
Slide 16: Polo Park - Nashville, TN
Community in Nashville, TN 386 Homes Average Monthly Collections: $624 Candidate for Kitchen/Bath Program Strong Operating Team in Nashville - Opportunity for Improved Performance Polo Park UDR - Acquisitions UDR - Acquisitions UDR - Acquisitions
Slide 17: Essex Portfolio Acquisition, September 2004
16 garden-style communities 4,646 homes Purchase price: $755 million Current market value: $925 million Condo/density/Etc. market value: $1,100 million Cap rate at purchase: 5.5% Realized cap rate: 6.1% Cost per home: $162,721 Current value: $198,900 Condo/density/etc.: $238,000 2Q2006 Performance R
Slide 18: UDR - Sales: 2006 Summary
UDR - Sales 2006 Summary Property Location Price ($m) Homes _ Gain ($m) Submarkets of Dallas 6 Communities and Fort Worth, x 874.8 171 $17.9 Vista Point Phoenix, AZ 14.6 192 84 Condominiums AZ, MD, FL and OR 57.8 300 15.0 Total Apartment Communities $146.9 2,203 $ 41.0
Slide 19: Condo Summary
Opportunity to Create Value and Reduce Exposure in Selected Markets at Attractive After-Tax Cap Rates Business that will Produce $2.0 million of Quarterly FFO for Several Years Extensive Pipeline (over 15,000 homes) to Feed the Business for Many Years Condo Summary UDR - Sales
Slide 20: Development Pipeline at July 2006
Development Pipeline at July, 2006 UDR - Development
Slide 21: Verano - Rancho Cucamonga, CA
New Development in Rancho Cucamonga, CA 414 Homes $67 million Budget $162,100 Cost per Home 7.5% to 8.0% Return as Apartment Homes In Lease-Up: 71% Leased Verano UDR - Development UDR - Development UDR - Development
Slide 22: Mandalay on the Lake
Mandalay on the Lake UDR - Development New Development in Los Colinas, TX 367 Homes $32 million Budget $87,200 Cost per Home 7.5% to 8.3% Return as Apartment Homes Expected Completion - 3Q06 In Lease-Up: 55% Leased
Slide 23: Waterside Towers
Waterside Towers UDR - Development Purchased December 2003 Located in SW Washington D.C., 15 Minute Walk from National Mall Ten-Story Mid-Rise Structure 550 Existing Homes Current Rent: 1 Bed - $1,275 2 Bed - $1,725
Slide 24: Waterside Towers Planned Expansion
UDR - Development Waterside Towers Waterside Towers Waterside Towers ^ Planned Expansion on Existing Property ? 11 story tower ? 200 to 220 homes ? 12,000 to 18,000 sq. ft. for retail ? Estimated cost: $70 million ? Timing: Zoning - 18 mos. Pre-Construction - 14 mos. Construction - 24 mos. Contingen
Slide 25: JPI Joint Venture - Princeton Court
JPI - National Apartment Developer Negotiated new development in Marina Del Rey, CA 298 homes $134 million budget $449,700 cost per home 6% to 6.5% return as apartment homes Joint Venture - Princeton Court UDR - Development UDR - Development UDR - Development
Slide 26: Joint Venture - Bellevue, WA
Joint Venture - Bellevue, WA Proposed High Rise Development 400 Homes Ground Floor Retail $135 million Budget Structure: 49% UDR/51% SU Development UDR - Development Recent Su Development Project Bellevue, WA Bellevue Plaza Development Site
Slide 27: UDR - Redevelopment
Reinvest with Exterior Upgrades and Interior Renovations 10 Communities Underway - 3,101 Homes Targeting 8% to 10% Stabilized ROI 7,000 Homes Under Study Full Scope Rehabs UDR - Redevelopment
Slide 28: Legacy at Mayland, Richmond, VA
Built in 1973, Purchased by UDR in December 1991. 576 Homes Full Scope Rehab Approaching Completion Value Created: >$20 million Doubled Cash Flow to $4.6M in 33 Months Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.
Slide 29: Island Walk - Tampa, FL
Built in 1991, Purchased by UDR in December 1998. 400 Homes Full Scope Rehab Value Created: >$17 million Cash Flow Expected to Grow by 40% to Nearly $5 million Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 After Before Island Walk - Tampa, FL UDR - Redevelopment
Slide 30: Altamira Place - Altamira Springs, FL
Built in 1984, Purchased by UDR in April 1994. 360 Homes Full Scope Rehab Approaching Completion Value Created: > $10 million Cash Flow Expected to Grow by 57% to Nearly $2.3 million Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 Excel.Sheet.8 After Before Altamira Place - Alt
Slide 31: Full Scope Redevelopment: Great Oaks and Lakeside North
Full Scope Great Oaks - Elliott City, MD: 299 Homes, January 2007 Start, 2008 Completion Before After UDR - Redevelopment Lakeside North - Altamonte Springs, FL: 360 Homes, Sept. 2005 Start, May 2007 Completion
Slide 32: Kitchen/Bath Program
Kitchen/Bath Program After Before UDR - Redevelopment Dominion Park Green - Raleigh, NC Goals of K/B Program Increase NAV Low-Risk Redevelopment Attract Higher-Grade Resident Higher rent Better care of asset Neighborhood quality Flexibility/Modernization Standardization ? Lower cost maintenance
Slide 33: Kitchen/Bath Program
Upgraded Appliances, Cabinets, Lighting, Flooring, Etc. Targeting 8% to 10% Stabilized ROI 11,000 Completed; > 20,000 in Pipeline Kitchen/Bath Program Before After Providence Court - Charlotte, NC UDR - Redevelopment
Slide 34: Improving The Value Of Our Real Estate Portfolio
Buying and Selling Communities 2002-05 Acquisitions: $2,153M at 6.2% 2006 Acquisitions: $229M at 5.0% 2002-05 Sales: $1,245M at 6.8% 2006 Sales: $435M at 6.1% Kitchen and Baths 11,000 homes completed, > 20,000 in pipeline Target 8% - 10% ROI Full Scope Redevelopment Rehabs: 3,101 homes in process, 1
Slide 35: Compelling Value Creation Strategy
Creating Value and Making Money 5 Ways Strong Operator Delivering Stable, Predictable Returns Disciplined Approach to Buying Communities Capturing Value through Sales, created by Demand for Institutional-quality Apartment in Job Growth Markets Creating Value through Development and Redevelopment $53
Slide 36: Funds From Operations (FFO) Definition
Funds From Operations (FFO) - The National Association of Real Estate Investment Trusts ("NAREIT") defines funds from operations ("FFO") (April 2002 White Paper) as net income (computed in accordance with accounting principles generally accepted in the United States (GAAP)), excluding gains (or loss
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