Ladder Capital Corp · NYSE:LADR
Ladder Capital — Investor Presentation (May 2022)
35 slides from Ladder Capital's investor presentation, May 5, 2022
Slide 1: Investor Presentation
INVESTOR INVESTOR PRESENTATION PRESENTATION OCTOBER 2021 MAY 2022 NYSE: LADR NYSE: LADR A Leading A Leading Commercial Commercial Real Real Estate Estate Investment Trust Investment Trust 1
Slide 2: Disclaimers
DISCLAIMERS This presentation contains forward-looking statements regarding possible or assumed future results of the business, financial condition, plans and objectives of Ladder Capital Corp and its subsidiaries and affiliates (collectively, “Ladder Capital,” “Ladder,” “LADR,” or the “Company”). A
Slide 3: Ladder Capital Highlights
LADDER CAPITAL HIGHLIGHTS LADDER CAPITAL (NYSE: LADR) IS A LEADING COMMERCIAL REAL ESTATE (CRE) CAPITAL PROVIDER, WITH $6.0 BILLION OF ASSETS AND $1.5 BILLION OF BOOK EQUITY CORE COMPETENCY OF CRE CREDIT UNDERWRITING MULTI-CYLINDER BUSINESS MODEL WITH NATIONAL DIRECT CRE ORIGINATION PLATFORM – INVES
Slide 4: Well Positioned Going Forward
WELL POSITIONED GOING FORWARD Originated $3.5 billion of first mortgage loans during twelve months ended 03/31/2022, and FY 2021 Strong Originations, produced highest annual volume of balance sheet loan originations in Ladder’s history at $2.9 billion Significant Dry Powder ~$700 million of liqu
Slide 5: Best-in-Class Team of Seasoned Leaders
BEST-IN-CLASS TEAM OF SEASONED LEADERS ✓ Executive team averages 25 years of industry experience and thought leadership through multiple market cycles ✓ Managers average over 10 years at Ladder and over 20 years of industry experience ✓ Led by Brian Harris – formerly Head of Commercial Real Estate a
Slide 6: Ladder Investing Snapshot
LADDER INVESTING SNAPSHOT PERMANENT CAPITAL VEHICLE CERTAINTY OF EXECUTION NATIONAL PRESENCE LADR $6.0BN NYSE Listed TOTAL ASSETS >$44BN OF INVESTMENTS ABILITY TO MOVE QUICKLY; ORIGINATED LOANS IN OVER SINCE INCEPTION IN 2008 UNDERWRITING CONDUCTED 475 CITIES ACROSS 48 STATES IN-HOUSE MIDDLE MARKET
Slide 7: Core Competency: CRE Credit Underwriting
CORE COMPETENCY: CRE CREDIT UNDERWRITING Three complementary, synergistic products within a relative-value, risk-adjusted return investment approach Portfolio Allocation Across CRE Capital Stack Invest in short-dated investment grade securities secured by senior commercial real estate loans CRE Se
Slide 8: Diversified & Granular Senior Secured Loan Portfolio
DIVERSIFIED & GRANULAR SENIOR SECURED LOAN PORTFOLIO Disciplined lending approach with middle-market focus and national footprint 1 1 Loan Type Loan Size Other Key Loan Portfolio Metrics 75% of loans on balance sheet comprised of post-COVID originations 98% senior secured first mortgage loans
Slide 9: Conduit Loans
CONDUIT LOANS An attractive source of ROE enhancement & retained earnings Top 10 >$700 $17.0 $1.7 71 million billion billion CMBS loan Cumulative Total loans Total Loans securitized contributor gains 1 securitized transactions in four Ladder-only transactions Partners include Citi, Credit Suisse,
Slide 10: High-Quality CRE Equity Portfolio – Predominantly Net Lease
HIGH-QUALITY CRE EQUITY PORTFOLIO – PREDOMINANTLY NET LEASE Source of stable, recurring net rental income with potential NAV upside; financed with long-term, non-recourse debt CRE Equity Portfolio Metrics CRE Equity Assets by Property Type Total Gross Asset Value $1.1 billion Total Net Equity Invest
Slide 11: Primarily I.G.-Rated Net Lease Tenants
PRIMARILY I.G.-RATED NET LEASE TENANTS 67% of Ladder’s net lease CRE equity portfolio leased to investment grade-rated tenants Ladder CRE Equity Assets ($mm) Net Lease Portfolio Highlights • $665 million, or 62% of CRE equity assets are net leased to predominantly necessity-based businesses under lo
Slide 12: Embedded Value in CRE Equity Portfolio
EMBEDDED VALUE IN CRE EQUITY PORTFOLIO Ladder has consistently realized gains by selling real estate at prices above its undepreciated carrying value Book Equity Value: Summary of CRE Equity Sales GAAP & Undepreciated ($mm) (FY 2020 – 2022; $mm) 2 Gain vs. Undepreciated Undepreciated Net Sales Carry
Slide 13: Highly-Rated & Granular, Short-Dated Securities Portfolio
HIGHLY-RATED & GRANULAR, SHORT-DATED SECURITIES PORTFOLIO Total Securities Portfolio Metrics Highly-Rated Securities Portfolio Securities on Balance Sheet $663 million % CMBS 99%+ % Investment Grade-Rated 99%+ 99%+ % AAA-Rated or Agency-Backed 86% Investment Grade-Rated % Floating-Rate 93% Weighted-
Slide 14: Diverse and Robust Capital Structure with Modest Leverage
DIVERSE AND ROBUST CAPITAL STRUCTURE WITH MODEST LEVERAGE 03/31/2022 Capitalization Summary ($mm) $5.9B Total Capitalization Adjusted Debt/Equity (Adjusted Leverage Ratio): 1.9x 1 Net Adjusted Debt (excluding Cash) /Equity Ratio: 1.6x 2 Net Adjusted Debt (excluding Cash) & Excluding Securities /Equi
Slide 15: Differentiated Capital Structure vs. Peers
DIFFERENTIATED CAPITAL STRUCTURE VS. PEERS Ladder’s usage of unsecured & non-recourse financing is unmatched in the space LADR Financing Mix Selected Peer Average Financing Mix 1 Unsecured Bonds 79% <30% Convertible Bonds Unsecured + Secured Bonds Unsecured + Non-Recourse Non-Recourse CLO Debt Non-R
Slide 16: Long & Strong Liability Structure
LONG & STRONG LIABILITY STRUCTURE Superior access to capital with diversified financing sources and substantial undrawn capacity Remaining Debt Maturities by Financing Type 1 ($mm; as of 03/31/2022) Issuance / Debt Maturity Year (weighted-average, where applicable) Facility Size Outstanding 2022 202
Slide 17: Staggered Debt Maturity Profile
STAGGERED DEBT MATURITY PROFILE Termed out maturities with large component of unsecured, non-recourse and non-mark-to-market financing 03/31/2022 Unsecured & Secured Debt Maturities ($mm) Unsecured Debt 1 Secured Debt Long & strong liability structure in place, with no corporate bond maturities unti
Slide 18: Well-Positioned for Rising Rate Environment
WELL-POSITIONED FOR RISING RATE ENVIRONMENT With large floating-rate balance sheet loan portfolio and predominantly fixed-rate liabilities, earnings are positively correlated to rising interest rates Estimated Annual Increase in Net Interest Income per Share Interest rate increases: 95% of balance
Slide 19: Large, High-Quality Unencumbered Asset Pool
LARGE, HIGH-QUALITY UNENCUMBERED ASSET POOL ✓ 47% of total asset base is composed of unencumbered assets ✓ 81% of unencumbered assets are cash, first mortgage loans or investment grade securities Total Unencumbered Asset Pool ($mm) Key Unencumbered Asset Pool Highlights Predominantly senior, finan
Slide 20: Ladder Investment Thesis
LADDER INVESTMENT THESIS Strong originations and Highly-experienced significant dry powder management team One of the only Consistently profitable internally-managed since inception CRE finance REITs Ladder Capital Significant long-term unsecured, Highest insider ownership non-recourse and non-mark-
Slide 21: Appendix
APPENDIX 21
Slide 22: Company Information
COMPANY INFORMATION Ladder is an internally-managed real estate investment trust that is a leader in commercial real estate finance. Ladder originates and invests in a diverse portfolio of commercial real estate and real estate-related assets, focusing on senior secured assets. Ladder’s investment a
Slide 23: Corporate Responsibility Overview
CORPORATE RESPONSIBILITY OVERVIEW Ladder is committed to sound corporate governance, environmental stewardship, and social responsibility Our Our Our Our Principles People Communities Planet Our Principles Our People Our Communities Our Planet − Our Nominating and − 40% of Executives and − 48%1 of o
Slide 24: Ladder Financial Snapshot
LADDER FINANCIAL SNAPSHOT ($ in millions, except per share amounts) Snapshot of Business Lines Total Assets & Liabilities, Book Equity, Leverage and ROE Balance Sheet Loans Net Leased Commercial Real Estate (100% Owned) Total Assets Carrying Value of Assets $3,857 Carrying Value of Assets $520 Cash
Slide 25: Loan Portfolio Key Metrics
LOAN PORTFOLIO KEY METRICS Weighted- Weighted- Type of Loan Balance 1 % of Loan % of Total Business Average Average Loan ($mm) Portfolio Assets Plan Rate Coupon LTV Balance Sheet First Held for Generally $3,774 96.5% 63.2% 4.9% 68.2% Mortgage Loans investment floating-rate Conduit First Generally $5
Slide 26: CRE Equity Portfolio Key Metrics
CRE EQUITY PORTFOLIO KEY METRICS ($ in millions) Undepreciated Asset % of CRE Equity Net Equity ~ Total In-Place Annual Type of Asset Carrying Value Portfolio Non-Recourse Invested Square Net Operating Real Estate Value (Depreciated) (Undepreciated) Mortgage Financing (Undepreciated) Feet Income Net
Slide 27: Net Leased CRE Equity Portfolio Key Details
NET LEASED CRE EQUITY PORTFOLIO KEY DETAILS Bank of America Dollar Walgreens BJ's Wholesale Hy-Vee Inc. Additional Net Total Net Leased / ($ in millions) Office Campus General Corp Co Club Inc. Supermarkets Leased Properties Weighted-Avg. (1 Property) (102 Properties) (21 Properties) (6 Properties)
Slide 28: Diversified CRE Equity Portfolio Key Details
DIVERSIFIED CRE EQUITY PORTFOLIO KEY DETAILS Richmond, VA Isla Vista, CA Miami, FL Additional Diversified Total Diversified CRE / ($ in millions) Office Portfolio Student Housing Multifamily Property CRE Properties Weighted-Avg. (1 Property) (1 Property) (1 Property) (8 Properties 1) (11 Properties)
Slide 29: Investment & Risk Management Process
INVESTMENT & RISK MANAGEMENT PROCESS Separate departments function as “check & balance” on internal process Origination Credit/ Transaction Investment Asset Underwriting Management Committee Management 17 originators, Independent Independent, highly- Comprehensive Credit Maintain direct di
Slide 30: Timeline of Key Ladder Events
TIMELINE OF KEY LADDER EVENTS 2009 2011 2013 2015 2017 2019 2021 MANAGEMENT PLUS $257M SERIES B $259M IPO THIRD UNSECURED $99M FOLLOW-ON FIFTH UNSECURED INSTITUTIONAL AND SOVEREIGN EQUITY RAISE ON NYSE: BOND OFFERING: PRIMARY EQUITY BOND OFFERING: WEALTH INVESTORS COMMIT 15.2M SHARES $500M 5-YEAR, 5
Slide 31: Executive Team
LADDER TEAM BIOS: EXECUTIVE TEAM Industry Name Title Experience Previous Experience/Bios Brian Harris Founder & 37 years Prior to forming Ladder in 2008, Mr. Harris served as a Senior Partner and Head of Chief Executive Officer Global Commercial Real Estate at Dillon Read Capital Management, a wholl
Slide 32: Other Senior Executives
LADDER TEAM BIOS: OTHER SENIOR EXECUTIVES Industry Name Title Experience Previous Experience/Bios Michael Scarola Chief Credit Officer 24 years Prior to joining Ladder in 2008, Mr. Scarola served as Co-Head of Underwriting at UBS/Dillon Read Capital Management. Mr. Scarola received a B.S. from the L
Slide 33: Other Senior Executives (Cont.)
LADDER TEAM BIOS: OTHER SENIOR EXECUTIVES (CONT.) Industry Name Title Experience Previous Experience/Bios Mark Ableman Head of Transaction 20 years Prior to joining Ladder in 2011, Mr. Ableman served as an Associate at Cadwalader, Management Wickersham & Taft LLP. Mr. Ableman received a B.S. from In
Slide 34: Selected Definitions
SELECTED DEFINITIONS • Adjusted Leverage Ratio (non-GAAP) ̶ Total debt obligations, net of deferred financing costs, adjusted for non-recourse indebtedness related to securitizations that is consolidated on our GAAP balance sheet and liability for transfers not considered sales, divided by Total Adj
Slide 35: Index of Slides
INDEX OF SLIDES Slide # Slide Contents Slide # Slide Contents 1 Cover 19 Large, High-Quality Unencumbered Asset Pool 2 Disclaimers 20 Ladder Investment Thesis 3 Ladder Capital Highlights 21 Appendix 4 Well Positioned Going Forward 22 Company Information 5 Best-in-Class Team of Seasoned Leaders 23 Co