D/b/a Centerspace · NYSE:CSR
D/b/a Centerspace — Investors Real Estate Trust — REITworld (November 2020)
24 slides from D/b/a Centerspace's conference presentation, Nov 16, 2020
Slide 1: REITworld
S N ° N a oO 2 & wo > ie} 2 REITworld
Slide 2: Safe Harbor Statement and Legal Disclosure
SAFE HARBOR STATEMENT AND LEGAL DISCLOSURE Certain statements in this press release and the accompanying Supplemental Operating and Financial Data are based on our current expectations and assumptions, and are “forward- looking statements” within the meaning of Section 27A of the Securities Act of 1
Slide 3: Company Snapshot
COMPANY SNAPSHOT Focused on Growth In Multifamily Strong Midwest markets led by Differentiated Minneapolis and Denver Markets Nashville a new target market Internal Growth Enhanced operating platform Opportunity PORTFOLIO SUMMARY Value‐Add Deep value-add pipeline . Founded in 1970, celebrating 50 Ye
Slide 4: Portfolio Overview
PORTFOLIO OVERVIEW Differentiated Portfolio‐ Strong Midwest Markets Percent of 2020 NOI by State Avg. Rev Region Homes per Occ. Mino (1) GrandMinot Grand Forks Home t Mino Target Markets Billings t Forks Minneapolis, MN 2,537 $1,620 6% Bismarck 18% Billings 46% Rochester, MN 1,711 $1,315 Bismarck Bi
Slide 5: COVID-19 Update
COVID‐19 UPDATE Focusing Efforts to Maintain Collections and Retain Occupancy Impact by State Q3 2020 % of Total October 2020 Bad Q3 2020 Bad Debt Q2 2020 Bad Debt Q1 2020 Bad Debt State Communities Homes Revenue Debt % of Revenue % of Revenue % of Revenue % of Revenue Minnesota 32 5,438 50.5% 2.2%
Slide 6: Operational and Margin-Enhancing Initiatives
OPERATIONAL AND MARGIN‐ENHANCING INITIATIVES Margin Growth through Operational Opportunities & Thoughtful Acquisitions and Dispositions Strong Operating Platform Buying Efficient Communities Same-Store communities continue to see NOI and gross margin growth Communities acquired have a weighted avera
Slide 7: Value-Add Opportunity
VALUE‐ADD OPPORTUNITY Enhancing Portfolio Through Value‐Add Projects Highlights New SouthFork Clubhouse . For 2020, 13 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 8: 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. . Post‐acquisition rents were optimized prior to initiating valu
Slide 9: Capital Recycling
CAPITAL RECYCLING Significantly Improved the Quality and Multifamily Focus of Our Portfolio • $1.1B of dispositions since August 2016 • Used disposition proceeds to purchase four multifamily communities in Denver, five multifamily communities in Minneapolis, fund two multifamily development mezzanin
Slide 10: Capital Recycling: Improved Portfolio Metrics
CAPITAL RECYCLING Improved Portfolio Metrics We focus our energy and capital on improving Multifamily portfolio quality has improved since 2017 3 Long‐Term Metrics 2017(1) September 2020 Communities Communities 100 67 Portfolio Quality Homes Homes 13,212 11,910 Homes per Community Homes per Communit
Slide 11: Capital Structure
SEPTEMBER 30, 2020 CAPITAL STRUCTURE Stable and Flexible Balance Sheet $1.7B Total Capitalization % of Wtd Avg Wtd Avg Debt Summary Amount Total Int Rate Maturity Total Secured Debt 314,511,157 44% 3.99% 5.23 $912M Secured Debt Common Line of Credit 135,000,000 19% 2.97% 1.92 18% Equity Term Loans 1
Slide 12: Recent Acquisitions
RECENT ACQUISITIONS Focus on Expanding Our Portfolio In Target Markets of Minneapolis and Denver Parkhouse Ironwood Lugano at Apartments Apartments Cherry Creek Denver, CO Minneapolis, MN Denver, CO Suburban Suburban Suburban $144.7 million $46.3 million $99.3 million . A 465‐unit community built in
Slide 13: Unemployment
UNEMPLOYMENT IRET lowest unemployment rate among peers and 32% below the US Average September 2020 Weighted Average Unemployment Rate state unemployment rate weighted by unit count 10.4% 9.2% 9.4% 8.6% 8.8% 8.1% 7.8% 7.8% 7.8% 7.8% 7.9% 7.9% 7.4% 7.2% 7.3% 6.7% 5.3% IRET IRT MAA AMH BRG UMH CPT NXRT
Slide 14: 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 15: Denver
DENVER Maintaining Growth – Robust In‐Migration Continues, We Seek Additional Scale, Our Portfolio Performing Well MARKET HIGHLIGHTS . Diverse economy and major hub of technology, energy, aviation and bioscience; 23 Fortune 1,000 companies have their headquarters in CO . #2 on U.S. News Best Places
Slide 16: 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 economy
Slide 17: Focused Secondary Market Presence
FOCUSED SECONDARY MARKET PRESENCE These Four Markets, Plus Minneapolis‐St. Paul and Denver Make Up 80% of Pro Forma NOI Rochester, MN Omaha, NE Grand Forks, ND St. Cloud, MN Population 216,035 922,891 101,991 196,598 Median Household Income $71,501 $65,227 $53,413 $59,792 Unemployment Rate(1) 5.9% 4
Slide 18: 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 19: 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 20: Investment Highlights
INVESTMENT HIGHLIGHTS Differentiated Market Exposure Internal Growth Opportunities Value‐Add Opportunities Flexible Balance Sheet Best in Class Governance www.iretapartments.com 20
Slide 21: Appendix
Appendix www.iretapartments.com 21
Slide 22: 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 23: Reconciliation to Non-GAAP Measures
RECONCILIATION TO NON‐GAAP MEASURES www.iretapartments.com 23
Slide 24: 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
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