D/b/a Centerspace · NYSE:CSR
D/b/a Centerspace — Investors Real Estate Trust — REITweek 2020
23 slides from D/b/a Centerspace's conference presentation, Jun 1, 2020
Slide 1: REITweek 2020 June 2-4, 2020
REITWEEK 2020 JUNE 2-4,2020
Slide 2: Safe Harbor Statement and Legal Disclosure
SAFE HARBOR STATEMENT AND LEGAL DISCLOSURE Certain statements in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual resu
Slide 3: Company Snapshot
COMPANY SNAPSHOT Focused on Growth In Multifamily Increased exposure in Differentiated Minneapolis and Denver Markets Nashville a new target market Internal Growth Enhanced operating platforms Opportunity with minimal capital needs PORTFOLIO SUMMARY Value-Add . Founded in 1970, celebrating 50 Years
Slide 4: Portfolio Overview: Strong Midwest Markets
PORTFOLIO OVERVIEW Strong Midwest Markets Percent of Pro Forma 2020 NOI by State Mino Avg. Rev per Mino GrandMinot Grand Forks Target Markets Region Homes t Occ. Home (1) Billings t Forks 5% Bismarck 20% Minneapolis, MN 2,355 $1,616 Billings Bismarck Bismarck 49% St. Cloud Rochester, MN 1,711 $1,312
Slide 5: Same-Store Trends and Metrics
SAME-STORE TRENDS AND METRICS Solid Q1 with 3.9% Revenue Growth First Quarter Comparison by Region Year-Over-Year % Change Wtd Avg Wtd Avg Wtd Avg YoY Region % of NOI Homes Revenue Expenses NOI Occupancy(1) Rent(2) Rent Growth Minneapolis, MN 23.1% 1,987 3.8% 7.5% 1.1% 94.2% $1,485 2.8% Rochester, M
Slide 6: COVID-19 Update
COVID-19 UPDATE Focusing Efforts to Maintain Collections and Retain Occupancy Impact by State April & May % Credit Card April & May April & May of Total Shelter in Halt of Late Fees Payment Fee 2020 Bad Debt 2020 Bad Debt State Communities Homes Charges Place Order Evictions Prohibited Waiver % of R
Slide 7: Operational and Margin-Enhancing Initiatives
OPERATIONAL AND MARGIN-ENHANCING INITIATIVES Focusing Efforts to Harvest Organic Growth Opportunity from Operational Initiatives Same-Store Gross Margin (1) Same-Store NOI Margin 73% 60% 72% 74% 59% 61% 71% 75% 58% 62% 70% 4.7% 76% 57% 63% increase in 1.5% gross increase in 69% margin 77% 56% NOI ma
Slide 8: Value-Add Opportunity
VALUE-ADD OPPORTUNITY Enhancing Portfolio Through Value-Add Projects Highlights New SouthFork Clubhouse . For 2020, 15 communities have been completed or are in the process of value add projects . Value-add opportunities across the portfolio feature unit renovations, common areas, and adding ameniti
Slide 9: Value-Add Case Study
VALUE-ADD CASE STUDY Enhancing Portfolio Through Value-Add Projects Opportunity . SouthFork, a value orientated multifamily community located in a south Before metro suburb of Minneapolis, was acquired in February 2019 for $44 million. . Rents were optimized before value-add initiative to redevelop
Slide 10: Capital Recycling
CAPITAL RECYCLING Significantly Improved Portfolio We focus our energy and capital on improving Multifamily portfolio quality has improved since 2017 3 Long-Term Metrics FY2017 Today Communities Communities 87 70 Portfolio Quality Homes Homes 12,885 12,135 Homes per Community Homes per Community NAV
Slide 11: March 31, 2020 Capital Structure
MARCH 31, 2020 CAPITAL STRUCTURE Stable and Flexible Balance Sheet % of Wtd Avg Wtd Avg $1.5B Total Capitalization Debt Summary $ Amount Total Int Rate Maturity Total Secured Debt 329,987,796 48% 4.01% 5.54 Debt SummaryTotal Unsecured Debt 353,000,000 52% 3.83% 5.69 $726M Secured Debt $683M Line of
Slide 12: Recent Acquisitions
RECENT ACQUISITIONS Focus on Expanding Our Portfolio In Target Markets of Minneapolis and Denver Ironwood Lugano at FreightYard Apartments Cherry Creek Townhomes and Flats Minneapolis, MN Denver, CO Minneapolis, MN $46.3 million $99.3 million $26.0 million . A 182‐unit community built in 2018 . 328
Slide 13: Minneapolis
MINNEAPOLIS Our Largest Market – On-Strategy Capital Allocation Remains as Market Continues to Perform MARKET HIGHLIGHTS . Culturally vibrant and economically diverse metro driven by major employment in health and life sciences, food and water, consumer retail, financial services, and manufacturing;
Slide 14: Denver
DENVER Maintaining Growth – Robust In-Migration Continues, We Seek Additional Scale, Our Portfolio Performing Well MARKET HIGHLIGHTS . Highly desirable quality of life and recreational amenities with strong appeal for millennials and outdoor enthusiasts . Diverse economy and major hub of technology,
Slide 15: Nashville
NASHVILLE New Target Market – A National Growth Leader in Household Income, Jobs and Millennial Population MARKET HIGHLIGHTS . True live-work-play community with a lively cultural scene boasting the highest concentration of music industry establishments in the nation and a diverse and growing econom
Slide 16: Focused Secondary Market Presence
FOCUSED SECONDARY MARKET PRESENCE These Four Markets, Plus Minneapolis-St. Paul and Denver Make Up 81% of Pro Forma NOI Rochester, MN Omaha, NE Grand Forks, ND St. Cloud, MN Population 222,835 955,246 101,017 202,678 Median Household Income $75,176 $66,916 $55,808 $62,863 Unemployment Rate 2.6% 3.3%
Slide 17: Best in Class Governance
BEST IN CLASS GOVERNANCE High Caliber Leadership Focused on High Quality Governance Executive Management Team Mark O. Decker, Jr. John A. Kirchmann Anne M. Olson PRESIDENT AND CEO EVP AND CFO EVP AND COO IRET rated ISS’s top score of 1 - indicating highest quality corporate governance practices and
Slide 18: ESG Report Highlights
ESG REPORT HIGHLIGHTS Strong Focus on Environmental, Social, and Corporate Governance Completed LED lighting upgrades at 25 communities Energy Efficiency Only ENERGY STAR rated appliances used for replacement Provide shared cost water services encouraging lower consumption Serving the broader commun
Slide 19: Investment Highlights
INVESTMENT HIGHLIGHTS Differentiated Market Exposure Internal Growth Opportunities Value-Add Opportunities Flexible Balance Sheet Best in Class Governance www.iretapartments.com 19
Slide 20: Appendix
Appendix www.iretapartments.com 20
Slide 21: Reconciliation to Non-GAAP Measures
RECONCILIATION TO NON-GAAP MEASURES Reconciliation of Net Income (Loss) Available to Common Shareholders to Funds From Operations and Core Funds From Operations We use the definition of FFO adopted by the National Association of Real Estate Investment Trusts, Inc. (“Nareit”). Nareit defines FFO as n
Slide 22: Reconciliation to Non-GAAP Measures
RECONCILIATION TO NON-GAAP MEASURES www.iretapartments.com 22
Slide 23: Reconciliation to Non-GAAP Measures: Adjusted EBITDA
RECONCILIATION TO NON-GAAP MEASURES Reconciliation of Net Income (Loss) Available to Common Shareholders to Adjusted EBITDA Adjusted EBITDA is earnings before interest, taxes, depreciation, amortization, gain/loss on sale of real estate and other investments, impairment of real estate investments, g