Cto Realty Growth, Inc. · NYSE:CTO
Cto Realty Growth — Consolidated Tomoka Land — 2019 REITweek
46 slides from Cto Realty Growth's conference presentation, Jun 3, 2019
Slide 1: 2019 REITweek Presentation
NYSE American: CTO 2019 REITWEEK PRESENTATION Falls Church, Virginia Winston Salem, North Carolina CTO’s 50TH YEAR on the NYSE
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS CONSOLIDATED TOMOKA If we refer to “we,” “us,” “our,” or “the Company,” we mean Consolidated-Tomoka Land Co. and its consolidated subsidiaries. Certain statements contained in this presentation (other than statements of historical fact) are forward-looking statements. Word
Slide 3: CTO Snapshot
CTO SNAPSHOT CONSOLIDATED TOMOKA As of May 31, 2019 (unless otherwise noted) Portfolio Quality Organic Capital Source Discount to NAV 3 INCOME PROPERTIES 47 14 2.3mm $32.8mm STATES SQUARE FEET ANNUALIZED NOI (C) TOTAL ACRES REMAINING 5,300+ 3,200 $180.0mm ACRES UNDER CONTRACT (A) TOTAL ESTIMATED
Slide 4: YTD 2019 Highlights
YTD 2019 HIGHLIGHTS CONSOLIDATED TOMOKA Continuing to Execute Our Strategy 4 MONETIZING LAND HARVEST MULTI-TENANT REDEPLOY PROCEEDS INTO SINGLE-TENANT RETAIL TOTAL SALES PRICE: $7.0 million ACRES: ≈60.5 PRICE PER ACRE: $116,000 GAIN: $4.8mm ($0.70/share, net of tax) TOTAL SALES PRICE: $42.9 million
Slide 5: Track Record of Strong Operating Results
’14 – ’18 CAGR 29% ’14 – ’18 CAGR 52% ’14 – ’18 CAGR 50% ’14 – ’18 CAGR 16% ($000’s) TRACK RECORD OF STRONG OPERATING RESULTS CONSOLIDATED TOMOKA Annual Results for 2014 –2018, 1st Quarter for 2019 ($000’s) Consistent Growth in Key Metrics (1) Basic Earnings per Share including from discontinued ope
Slide 6: Components of CTO's Value
COMPONENTS OF CTO’S VALUE CONSOLIDATED TOMOKA A Lot More Income than Land Percentages based on values derived on NAV worksheet on Slide #7 Excluding Cash & Restricted Cash 47 Properties 2.3 million Sq. Ft. Retail and Office NOI $32.8 million (C) Subsurface Interests >450,000 Acres 5,300 Total Acr
Slide 7: NAV Worksheet
NAV WORKSHEET (A)(F) CONSOLIDATED TOMOKA Indicative of Meaningful Discount in our Stock Price 7 Cap Rate on NOI (C) Contract amounts As of May 31, 2019 As of March 31, 2019 Excludes intangible lease liabilities As of May 31, 2019 (unless otherwise noted) Highlighted Components of NAV Basis for Value
Slide 8: Implied Value of Land
IMPLIED VALUE OF LAND CONSOLIDATED TOMOKA Our Current Stock Price Implies Heavily Discounted Value for Land 8 As of May 31, 2019 (unless otherwise noted) Cap Rate Sensitivity Applied to Income Property NOI 6.0% 6.5% 7.0% Equity Market Cap $ 296,043,787 $ 296,043,787 $ 296,043,787 Debt $ 261,100,000
Slide 9: Momentum Monetizing Land
MOMENTUM MONETIZING LAND CONSOLIDATED TOMOKA Monetizing Land With Tax Deferred Strategy (Land Sales in $000’s) Dramatic Acceleration Monetizing Land Annual Land Sales: 2013 –2018, YTD 2019 & Pipeline(A) as of 5/31/19 9 (2) (1) (1) ACRES SOLD 11.7 99.6 114.0 707.6 1,700.9 2,697.3 2013 – 2018 and YTD
Slide 10: Pipeline of Potential Land Sales
Contract/Parcel Acres Contract Amount (rounded) Price per Acre (rounded) Timing Residential (SF) 1,599 $27.0mm $17,000 ‘19 - ‘20 ICI Homes (SF) 1,016 $21.5mm $21,000 ‘19 Commercial/MOB 32 $8.1mm $253,000 ‘19 - ‘20 Residential (MF)/Retail 38 $6.1mm $161,000 Q4 ’19 Unicorp 31 $4.6mm $148,000 ‘19 - ‘20
Slide 11: Income Property Investments
INCOME PROPERTY INVESTMENTS Converting into Income ($000’s) Total Acquisitions for 2013 – 2018, YTD 2019 and Est. for Remainder of 2019 (J) Diversified Markets Higher Quality Properties Net of master tenant purchase contribution of $1.5 million for acquisition of income property in Aspen, CO in Q1 2
Slide 12: Single-Tenant Office Investment, Winston Salem
SINGLE-TENANT OFFICE INVESTMENT CONSOLIDATED TOMOKA Long Term Lease – Strong Retail Corridor 12 Single Tenant Retail 7.6 Acres 11-year Lease Term Rent Escalations every 5 yrs. Year Built 2015 Investment basis $147/SF Acquisition Cap Rate 6.30% Investment $8.1 Million 11-Year NNN Lease 55,000 Square
Slide 13: Single-Tenant Office Investment, Falls Church
SINGLE-TENANT OFFICE INVESTMENT CONSOLIDATED TOMOKA Strong Demographics – Infill Location 13 Single Tenant Retail 3.09 Acres 9-year Lease Term Rent Escalations every 5 yrs. Renovated 2012 6 miles from the Pentagon FAR estimated at 3.0x – ability to develop 400k sf of density and approved for multipl
Slide 14: Recycling Capital into Single-Tenant
RECYCLING CAPITAL INTO SINGLE-TENANT CONSOLIDATED TOMOKA Sales Price: $24.6 million Sarasota, FL MULTI-TENANT PROPERTY Harvesting Value Redeploying Capital 14 Monetize Multi-Tenant Property – Redeploy Proceeds into Single-Tenant Retail Jacksonville, FL CAP RATE: 5.98% Purchase Price: $32.3 million 8
Slide 15: Recycling Capital into Single-Tenant
RECYCLING CAPITAL INTO SINGLE-TENANT CONSOLIDATED TOMOKA Sales Price: $18.3 million Winter Park, FL MULTI-TENANT PROPERTY Harvesting Value Redeploying Capital 15 Monetize Multi-Tenant Property – Redeploy Proceeds into Single-Tenant Retail Falls Church, VA CAP RATE: 6.53% Purchase Price: $21.3 millio
Slide 16: Portfolio Highlights
PORTFOLIO HIGHLIGHTS CONSOLIDATED TOMOKA Stronger Markets – Stronger Credits 16 (% = as a % of Total NOI) As of May 31, 2019 Total Square Feet (2) Investment Grade Tenants (H) ≈2.3 32% States 14 Total Properties Annualized NOI (1) (C) 47 $32.8 Single Tenants >10% of NOI (C) 2 Geographic Diversity (1
Slide 17: Portfolio Highlights
PORTFOLIO HIGHLIGHTS As of May 31, 2019 CONSOLIDATED TOMOKA Transitioning to Single-Tenant Over Time 17 Portfolio Mix (% = as a % of Total NOI) (1) Weighted average for Single-Tenant portfolio only is 9.3 years Annual NOI (C) ≈$32.8mm Wgtd. Avg. Lease Term 8.3 yrs. (1) Square Feet ≈2.3mm High Qualit
Slide 18: Top Tenants Versus Peers
TOP TENANTS VERSUS PEERS CONSOLIDATED TOMOKA Which Would You Rather Own? 18 BBB 3.4% BBB- 3.3% BBB 3.0% BBB 2.6% B- 5.5% 8.9 46% 63%/37%/0% Discount -2% Stock Price vs NAV(1)(4) Avg. Lease Term (1)(4) Leverage Level (1) (4) Retail/Office/Other (4) 14.0 32% 83%/17%/0% Premium 25% B+ 2.4% NR 1.7% NR 1
Slide 19: How CTO's Portfolio Stacks Up
HOW CTO’S PORTFOLIO STACKS UP CONSOLIDATED TOMOKA Stronger Demographics = Better Markets & Long-Term Real Estate 19 Three Mile Population(1)(3) Implied Cap Rate(2) 3-Mile Avg. Household Income(1)(3) CTO info as of May 31, 2019 Peer implied cap rates info from Janney Montgomery Scott LLC as of May 31
Slide 20: Liquidity & Leverage
LIQUIDITY & LEVERAGE CONSOLIDATED TOMOKA Net Debt to TEV ≈ 45% Fixed Rate Debt ≈ 50% Unsecured Debt ≈ 79% Weighted Average Rate = 4.01% Average Duration 4.2 years As of May 31, 2019 (unless otherwise noted) Debt Schedule (E) ($ in millions) Liquidity Position ($ in 000’s) Total Commitment of Credit
Slide 21: Returning Capital to Shareholders
RETURNING CAPITAL to SHAREHOLDERS (B)(D) CONSOLIDATED TOMOKA Cumulative From 2013 Through 5/31/19 Consistent Approach Accretive to NAV 21 Cumulative Shares Purchased Cumulative $ Repurchased ($ in millions) Share Buybacks(B)(D) % of CTO Shares outstanding 0.00% 0.44% 2.05% 2.60% 2.32% 2.89% (1) Incl
Slide 22: Returning Capital to Shareholders
RETURNING CAPITAL to SHAREHOLDERS CONSOLIDATED TOMOKA 2012 Through Q2 2019 Disciplined Approach to Returning Capital 22 Annualized Dividend per Share INCREASING DIVIDEND + PAID QUARTERLY Dividends(G) Cumulative % increase in Dividend 50% 75% 100% 200% 350% 575% Note: 2019 based on annualization of Q
Slide 23: 2019 Guidance
2019 GUIDANCE CONSOLIDATED TOMOKA Monetizing Land Growing Free Cash Flow Recycling Capital 23 FY2019 Guidance Q1 2019 Actual (unless otherwise noted) Earnings Per Share (Basic) (1)(2) $6.75 - $7.50 $0.25 Incremental EPS (Basic) From Dispositions (2) $2.25 - $2.75 $0.96 Acquisition of Income-Producin
Slide 24: Appendix
CONSOLIDATED TOMOKA 24 APPENDIX
Slide 25: Single-Tenant Portfolio
CONSOLIDATED TOMOKA (1) Two properties Single-Tenant Portfolio (C) APPENDIX 25 As of May 31, 2019 (C) Lease contains rent escalations (1) Tenant/Building S&P Credit Rating Location Property Type Asset Type Rentable Square Feet Remaining Lease Term % of NOI Fidelity N/A Albuquerque, NM Office Single
Slide 26: Single-Tenant Portfolio
CONSOLIDATED TOMOKA Single-Tenant Portfolio (C) APPENDIX 26 As of May 31, 2019 (C) Lease contains rent escalations (1) Property formerly leased to Barnes & Noble, now subject to Ground Lease with WaWa, rent expected to commence in 2020 (1) Tenant/Building S&P Credit Rating Location Property Type Ass
Slide 27: Multi-Tenant Portfolio
CONSOLIDATED TOMOKA Multi-Tenant Portfolio APPENDIX 27 (C) As of May 31, 2019 (C) Lease contains rent escalations Tenant/Building S&P Credit Rating Location Property Type Asset Type Rentable Square Feet Remaining Lease Term % of NOI 3600 Peterson NR Santa Clara, CA Office Multi-Tenant 75,841 2.8 7.5
Slide 28: Top Income Property: Albuquerque, New Mexico
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 28 As of May 31, 2019 Albuquerque, New Mexico Asset Type Single-Tenant Office Tenant Fidelity Real Estate S&P Rating NR % of Portfolio NOI 10.4% Square Feet 210,067 Acres 25.34 Remaining Term 9.5 Year Built 2009 Purchase Date Oct 2018 Occupancy 100
Slide 29: Top Income Property: Hillsboro, Oregon
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 29 As of May 31, 2019 Hillsboro, Oregon Asset Type Single-Tenant Office Tenant Wells Fargo Bank, N.A. S&P Rating A+ % of Portfolio NOI 9.6% Square Feet 211,863 Acres 18.92 Remaining Term 6.6 Year Built 1978/2009 Purchase Date Oct 2017 Occupancy 100
Slide 30: Top Income Property: Raleigh, North Carolina
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 30 As of May 31, 2019 Raleigh, North Carolina Asset Type Single-Tenant Office Tenant Wells Fargo Bank, N.A. S&P Rating A+ % of Portfolio NOI 8.4% Square Feet 450,393 Acres 40.56 Remaining Term 5.3 Year Built 1996/1997 Purchase Date Nov 2015 Occupan
Slide 31: Top Income Property: Santa Clara, California
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 31 As of May 31, 2019 Santa Clara, California Asset Type Multi-Tenant Office Tenant Adesto Technologies Centrify Corp. S&P Rating NR % of Portfolio NOI 7.5% Square Feet 75,841 Acres 5.42 Remaining Term 2.8 Year Built 1978/2015 Purchase Date Oct 201
Slide 32: Top Income Property: Jacksonville, Florida
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 32 As of May 31, 2019 Jacksonville, Florida Asset Type Multi-Tenant Office Tenant Raymond James Northwestern Mutual S&P Rating NR % of Portfolio NOI 6.3% Square Feet 136,856 Acres 3.40 Remaining Term 2.8 Year Built 2003 Purchase Date Jul 2015 Occup
Slide 33: Top Income Property: Orlando, Florida
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 33 As of May 31, 2019 Orlando, Florida Asset Type Single-Tenant Office Tenant Hilton Grand Vacations S&P Rating BB+ % of Portfolio NOI 5.5% Square Feet 133,914 Acres 14.84 Remaining Term 7.5 Year Built 1988/2000 Purchase Date Jan 2013 Occupancy 100
Slide 34: Top Income Property: Falls Church, Virginia
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 34 As of May 31, 2019 Falls Church, Virginia Asset Type Single-Tenant Retail Tenant 24-Hour Fitness S&P Rating NR % of Portfolio NOI 4.2% Square Feet 46,000 Acres 3.09 Remaining Term 8.6 Year Built 2012 Purchase Date May 2019 Occupancy 100% Demogra
Slide 35: Top Income Property: Aspen, Colorado
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 35 As of May 31, 2019 Aspen, Colorado Asset Type Single-Tenant Retail Tenant A.G. Hill S&P Rating NR % of Portfolio NOI 4.0% Square Feet 19,596 Acres n/a Remaining Term 18.7 Year Built 2015 Purchase Date Feb 2018 Occupancy 100% Demographics 3-mile
Slide 36: Top Income Property: Katy, Texas
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 36 As of May 31, 2019 Katy, Texas Asset Type Single-Tenant Retail Tenant Lowe’s S&P Rating BBB+ % of Portfolio NOI 2.8% Square Feet 131,644 Acres 15.48 Remaining Term 7.7 Year Built 1997 Purchase Date Apr 2014 Occupancy 100% Demographics 3-mile Pop
Slide 37: Top Income Property: Brandon, Florida
CONSOLIDATED TOMOKA Top 10 Income Property APPENDIX 37 As of May 31, 2019 Brandon, Florida Asset Type Single-Tenant Retail Tenant LA Fitness S&P Rating B+ % of Portfolio NOI 2.6% Square Feet 45,000 Acres 5.28 Remaining Term 12.9 Year Built 2006 Purchase Date Apr 2017 Occupancy 100% Demographics 3-mi
Slide 38: The Map
APPENDIX CONSOLIDATED TOMOKA The Map 38
Slide 39: Active Adult Community Development on Land Sold by CTO
APPENDIX CONSOLIDATED TOMOKA > 700 Homes Sold Since Opening in Q4 2017 Active Adult Community – 3,400 Total Homes Planned Development in Progress on Land Sold by CTO 39 Commercial/Retail Development LPGA Blvd New Phases Amenities Under Construction
Slide 40: Tomoka Town Center Luxury Rental Community
APPENDIX CONSOLIDATED TOMOKA At Tomoka Town Center 276-Unit Luxury Rental Community Development in Progress on Land Sold by CTO 40 Projected development costs $39 million Leasing Commencement Q1 2019
Slide 41: Sam's Club Development on Land Sold by CTO
APPENDIX CONSOLIDATED TOMOKA Membership Wholesale Club Only New Development of Sam’s Club in U.S. Development in Progress on Land Sold by CTO 41 Opening July 2019
Slide 42: Distribution Center & Office Development
APPENDIX CONSOLIDATED TOMOKA New Distribution Center & New Office Development in Progress on Land Sold by CTO 42 Last Mile Distribution Center for Amazon Future Home of Costa Del Mar
Slide 43: New Multi-Family Property, LPGA Blvd
APPENDIX CONSOLIDATED TOMOKA New Multi-Family Location 300 Unit Multi-Family Property 43 Development in Progress on Land Sold by CTO LPGA Blvd
Slide 44: Self Storage Property Development
APPENDIX CONSOLIDATED TOMOKA Williamson Blvd. & Mason Avenue Self Storage Property 44 Development in Progress on Land Sold by CTO
Slide 45: End Notes
END NOTES CONSOLIDATED TOMOKA 45 End Notes references utilized in this presentation There can be no assurances regarding the value ultimately received for the Company’s assets, or in the case of the transactions under contract, the likelihood that such transactions will close or the timing or final
Slide 46: Contact Us
NYSE American: CTO 2019 REITWEEK PRESENTATION Falls Church, Virginia Winston Salem, North Carolina CTO’s 50TH YEAR on the NYSE Contact Us Investor Relations: Mark E. Patten P: 386.944.5643 mpatten@ctlc.com For additional information, please see our most recent Annual Report on Form 10-K, copies of w