Safehold Inc. New · NYSE:SAFE
Safehold Inc. New — Safety, Income & Growth — Q3 2017 Earnings Presentation
22 slides from Safehold Inc. New's earnings presentation, Oct 26, 2017
Slide 1: Q3'17 Earnings Results
Safety, Income & Growth Inc. The Ground Lease Company Q3’17 Earnings Results October 26, 2017 (NYSE: SAFE)
Slide 2: Forward-Looking Statements and Other Matters
Forward-Looking Statements and Other Matters This release may contain forward-looking statements. All statements other than statements of historical fact are forward-looking statements. These forward-looking statements can be identified by the use of words such as “illustrative”, “representative”, “
Slide 3: Q3'17 Highlights
Q3’17 Highlights The company reported Q3 2017 results of: $ in Thousands Per Share Note: Results for Q3 2017 do not include any percentage rent from the Hilton Western Portfolio, which is paid annually Net Income (Loss) ($721) ($0.04) and recorded in the first quarter. If the prior year’s FFO(1) $
Slide 4: Q3'17 Earnings Overview
Section 1 – Earnings Q3’17 Earnings Overview SAFE, initially capitalized on April 14, 2017 with investments by iStar and two institutional investors, completed its initial public offering on June 27, 2017. Three Months Ended For the Period 9/30/17 4/14/17 – 9/30/17 Net Income ($721) ($2,325)(1) per
Slide 5: Income Statement
Section 1 – Earnings Income Statement Three Months Ended For the Period 9/30/2017 4/14/17 – 9/30/17 Revenues: Ground lease and other lease income $6,172 $10,374 Other income 84 86 Total revenues $6,256 $10,460 Costs and expenses: Interest expense $2,445 $4,313 Real estate expense 472 897 Depreciatio
Slide 6: FFO / AFFO
Section 1 – Earnings FFO / AFFO Three Months Ended For The Period 9/30/2017 4/14/17 – 9/30/17 Net income ($721) ($2,325) Add: Real estate related depreciation and amortization 2,266 4,139 FFO $1,545 $1,814 FFO $1,545 $1,814 Less: Straight-line rental income (1,378) (2,422) Add: Amortization of real
Slide 7: Portfolio Roll Forward
Section 2 – Portfolio Portfolio Roll Forward # of Ground Lease Basis Assets Real Estate, 6/30/2017 14 $481 Acquisitions: LifeHope Medical Campus 1 $16 Real Estate, 9/30/2017 15 $497 Future Commitments: Great Oaks Multifamily 1 $34 Note: $ in millions. Safety, Income & Growth Inc. The Ground Lease Co
Slide 8: New Investment: LifeHope Medical Campus
Section 2 – Portfolio New Investment: LifeHope Medical Campus 3333 Old Milton Parkway – Alpharetta, GA A 117K rsf, 6-story medical office building on 10.2 acres. The property will be renovated Asset Description and converted into a class-A building, which is currently expected to take 12+ months. So
Slide 9: Forward Commitment: Great Oaks Multi-Family
Section 2 – Portfolio Forward Commitment: Great Oaks Multi-Family Raleigh Road & Via del Oro – San Jose, CA Asset Description A luxury multi-family project containing 301 units currently under construction in San Jose, CA Source New origination in conjunction with iStar(1) Forward Commitment SAFE ha
Slide 10: Geographic Diversification by MSA
Section 2 – Portfolio Geographic Diversification by MSA Seattle 18.3% Detroit Minneapolis 0.4% 14.6% Salt Lake City 1.6% San Francisco Milwaukee 4.4% 11.3% Washington 1.9% 4.1% Atlanta San Diego Durango 28.6% 6.5% 5.6% 2.8% Los Angeles Dallas Note: Percentages based on total Ground Lease Basis of $4
Slide 11: Portfolio Stratification
Section 2 - Portfolio Portfolio Stratification 20-60 yrs Industrial 1% 1% Office 22% 4.0-5.0x Hospitality 6% Lease Term >60 yrs Property Type 47% <20 yrs 49% Remaining(2) 50% $497MM Property NOI to W.A. 66.5 yrs Ground Rent Multi-Family 5.0x+ 30% 55% W.A. 4.6x(1) 3.0-4.0x 39% 50-60% <30% Fixed 29% 3
Slide 12: Pipeline
Section 2 – Portfolio Pipeline San San Jose Francisco San Antonio 3% Multiple 4% 3% Locations Dallas 4% 3% $1.1B Pipeline Los Angeles 6% Other 13% Philadelphia 8% Location (MSA) $812MM New York Chicago 22% 16% Under Review Washington D.C. 18% Hospitality $278MM Acquire Mixed Use 4% 20% 8% Active Neg
Slide 13: Value Bank of $993MM or $54.56 per Share
Section 2 – Portfolio Value Bank of $993MM or $54.56 per Share At expiration or earlier termination of its Ground Leases, SAFE’s reversion rights create additional potential value to stockholders by allowing SAFE to take title to the buildings / improvements on its land(1) $993MM Value Bank is c
Slide 14: Credit Metrics
Section 3 – Capital Structure Credit Metrics As of September 30, 2017 Target leverage of (i) 25% of CPV and (ii) 2x debt to equity 10 years+ of interest protection Leverage Annualized Earnings to Fixed Charges Annualized FCCR GAAP As Adjusted Book Debt $227 Net income (loss) ($2.9) AFFO $8.1 Boo
Slide 15: Debt Overview
Section 3 – Capital Structure Debt Overview As of September 30, 2017 Debt Profile Debt Maturity Profile 2022 W.A. Maturity is 10 years $300(1) Jun.(1) $300 L+135 2027 $227(2) Apr.(2) $227 3.77%(3) Revolver Capacity Total $527 3.10%(4) 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 Hedge Prof
Slide 16: Balance Sheet
Section 3 – Capital Structure Balance Sheet As of As of September 30, 2017 June 30, 2017 Assets Real estate Real estate, gross $413,145 $406,844 Accumulated depreciation (2,752) (1,251) Real estate, net 410,393 405,593 Real estate-related intangibles, net 81,955 73,428 Ground lease assets, net 492,3
Slide 17: Appendix
Appendix Safety, Income & Growth Inc. The Ground Lease Company 16
Slide 18: Glossary
Appendix Glossary Ground Lease Basis Ground Lease Basis is the historical purchase price paid by SAFE to acquire or originate a ground lease. The current combined value of the land, buildings and improvements relating to a commercial property, as if there was no Ground Combined Property Value Lease
Slide 19: Explanation of FFO and AFFO
Appendix Explanation of FFO and AFFO We present FFO and AFFO because we consider them to be important supplemental measures of our operating performance and believe that they are frequently used by securities analysts, investors and other interested parties in the evaluation of REITs. FFO is a widel
Slide 20: Asset Summary
Appendix Asset Summary Underlying In Place Property NOI to Location Lease Expiration Contractual Rent Base Rent TTM Total Income Ground Rent Property (MSA) Property Type / As Extended Escalations (Annualized)(1) % Rent(2) Cash / GAAP(3) Coverage(4) Doubletree Seattle Airport(5)(6) Seattle, WA Hospit
Slide 21: End Notes
Appendix End Notes (1) Annualized cash base rental income in place as of September 30, 2017. (2) Total percentage cash rental income during the 12 months ended September 30, 2017. (3) Total GAAP Income reflects total cash rent adjusted for non-cash income and expenses, primarily consisting of straig
Slide 22: End Notes – (cont'd)
Appendix End Notes – (cont’d) (11) The property is currently under renovation. We expect renovations to be completed in April 2018. Represents underwritten expected NOI at the property upon stabilization and our estimated Ground Rent Coverage. (12) Base rent is subject to increase every 4 years base
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