Paramount Corp. Bhd. · MYX:PARAMON
Paramount Corp. Bhd — Investor Presentation (February 2024)
45 slides from Paramount Corp. Bhd's investor presentation, February 2024
Slide 1: Investor Presentation February 2024
INVESTOR PRESENTATION FEBRUARY 2024
Slide 2: Cautionary Note on Forward-Looking Statements
This presentation contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects” and similar expressions that do not relate to h
Slide 3: Table of Contents
Table of Contents 1 Introduction to Paramount 2 Business Update 3 Balance Sheet & Capital Structure 4 Portfolio Composition 5 Paramount Club 6 ESG Strategy 7 Appendix 3
Slide 4: Paramount at a Glance
Paramount at a Glance Paramount prides itself on being a best-in-class owner and operator of high- quality, Class A office properties in New York and San Francisco. Ticker: PGRE 1978 13.8 MM SQUARE FEET NYSE-LISTED COMPANY FOUNDED IN (across 18 assets) (1) ~$8.4 B (2) $330 MM (3) 87.7% TOTAL AUM CAS
Slide 5: Office Centric Business with High-quality Properties, Commanding Premium Rents
Office Centric Business with High-quality Properties, Commanding Premium Rents 95% Exposure to Trophy and Class A office rent revenues with limited retail exposure 6.3 years Average lease term for office leases New York – 7.3 years San Francisco – 3.7 years $87/sqft Annualized rent 5
Slide 6: High Credit Quality Tenant Base
High Credit Quality Tenant Base PGRE's Share of Square Feet % of Ann. (1) (2) Top 10 Tenants Expiration Date Occupied Rent (3) (3) 1. Various 344,010 4.8% Industr y Diversification – % 2. 6/2024 (4) 328,543 (4) 4.6% o f A n n u a l i z e d R e n t (2) Other Professional 3. 1/2031 288,823 4.4% Servic
Slide 7: Experienced and Diverse Management Team
Experienced and Diverse Management Team Executive Management ALBERT BEHLER WILBUR PAES PETER BRINDLEY GAGE JOHNSON ERMELINDA BERBERI Chairman, Chief Executive Chief Operating Officer, Chief Head of Real Estate General Counsel Chief Accounting Officer Officer & President Financial Officer & Treasurer
Slide 8: Business Update
1 Introduction to Paramount 2 Business Update 3 Balance Sheet & Capital Structure 4 Portfolio Composition 5 Paramount Club 6 ESG Strategy 7 Appendix 8
Slide 9: 2024 Key Guidance Assumptions
2024 Key Guidance Assumptions LEASING ACTIVITY SAME STORE NOI 650,000 – 900,000 square feet Cash (6.0%) – (4.0%) GAAP (4.5%) – (2.5%) SAME STORE POOL Removed Non-Core Assets 111 Sutter Street Market Center CORE FFO COMPOSITION SAME STORE LEASED % Cash NOI $1.40 S/L & FAS 141 Adj. 0.09 2023 YE, as re
Slide 10: 2024 Core FFO Bridge
2024 Core FFO Bridge $0.88 $0.87 ($0.20)(1) Consensus Adjusted $0.85 $0.65 Consensus $0.71 $0.82 $0.79 $0.08 ($0.02) ($0.05) $0.06 $0.76 $0.76 $0.06 ($0.03) $0.73 ($0.01) $0.70 $0.70 $0.67 $0.64 $0.61 $0.58 2023 Significant Free Rent Burn- Termination S/L Rent & FAS Interest and Interest G&A 2024 Ad
Slide 11: Impact of Non-Core Assets
Impact of Non-Core Assets (in thousands, except per share amounts) 2023 2023 Assumptions(1) Core FFO Adj. for non- Core FFO 2024 Adj. for non- 2024 As Reported core assets As Adjusted FFO core assets Core FFO Cash NOI $ 369,500 $ 14,700 $ 354,800 $ 331,000 $ 1,500 $ 329,500 S/L Rent & FAS 141 Adj. 5
Slide 12: 2024 Core FFO Bridge – Alternative Presentation
2024 Core FFO Bridge – Alternative Presentation (Excluding Non-Core Assets(1)) $0.88 $0.87 ($0.01) ($0.16)(2) $0.86 $0.85 $0.08 ($0.02) $0.82 ($0.04) $0.79 $0.08 ($0.03) ($0.01) $0.76 $0.76 $0.73 $0.70 $0.67 $0.64 $0.61 $0.58 2023 Adjustment for 2023 Core FFO Significant Free Rent Burn- Termination
Slide 13: Lease Expirations – Total Portfolio
Lease Expirations – Total Portfolio PGRE's Share of Sq. Ft. of Expiring Leases – Total Portfolio 5,000 4,564ksf 4,500 4,000 3,500 3,000 2,500 58.5% 5-Year Average: 651ksf 2,000 or 8.3% per annum 1,500 1,042ksf 957ksf 1,000 764ksf 500 13.3% 12.2% 9.8% 238ksf 253ksf 3.0% 3.2% 0 2024 2025 2026 2027 202
Slide 14: Lease Expirations – Core Portfolio
Lease Expirations – Core Portfolio (1) PGRE's Share of Sq. Ft. of Expiring Leases - Core Portfolio 5000 4,524ksf 4500 4000 3500 3000 2500 2000 5-Year Average: 588ksf 60.6% 1500 or 7.9% per annum 998ksf 910ksf 1000 681ksf 500 13.4% 12.2% 9.1% 205ksf 147ksf 2.7% 2.0% 0 2024 2025 2026 2027 2028 Thereaf
Slide 15: Lease Expirations – Core Portfolio (continued)
Lease Expirations – Core Portfolio (continued) 4500 PGRE's Share of Sq. Ft. of Expiring Leases - New York 4,055ksf Key Upcoming Roll 4000 (> 50k square feet at PGRE share) 3500 3000 2024 Clifford Chance (329ksf)(2) 2500 Leerink Partners (70ksf) 2000 69.3% 1500 5-Year Average: 358ksf or 6.1% per annu
Slide 16: Balance Sheet & Capital Structure
1 Introduction to Paramount 2 Business Update 3 Balance Sheet & Capital Structure 4 Portfolio Composition 5 Paramount Club 6 ESG Strategy 7 Appendix 16
Slide 17: Capital Structure Overview
Capital Structure Overview Liquidity ($ in Millions) (6) Capital Structure $1,219.1 (in thousands, except per share amounts) At Green Street $469.1 (1) NAV Stock Price $7.50 Common Shares 217,366 $750.0 Operating Partnership Units 19,468 Total Shares / Units Outstanding 236,834 Equity Market Capital
Slide 18: Debt Maturity Schedule – As of 12/31/23 (at share)
Debt Maturity Schedule – As of 12/31/23 (at share) $1,600 $1,514.9MM Weighted Average Maturity – 3.1 years $1,400 $1,200 $1,134.0MM $1,000 (1) 111 Sutter $800 60 Wall $80.0 $28.8 $586.6MM (2) $600 One Market $477.8 Market Center $400 $277.3 $200 $150.0MM $1.1MM $0 2024 2025 2026 2027 2028 Thereafter
Slide 19: Debt Maturity Schedule – Pro-forma (at share)
Debt Maturity Schedule – Pro-forma (at share) $1,600 $1,514.9MM Weighted Average Maturity – 3.9 years $1,400 $1,200 $1,162.8MM (2) 60 Wall $28.8 $1,000 $800 $600 $566.5MM (1) One Market $416.5 $400 $200 $1.1MM $0 2024 2025 2026 2027 2028 Thereafter % of Total Debt 51.6% 12.5% 0.0% 35.9% 0.0% 0.0% Ma
Slide 20: Debt Roll-forward (at share)
Debt Roll-forward (at share) (Amounts in millions) Property Level Debt Non-Core Increase (Secured) 12/31/2023 Assets (Decrease) Pro forma New York $ 2,672.8 $ - $ - $ 2,672.8 (1) (2) San Francisco 990.0 (357.3) (61.3) 571.4 Other 1.1 - - 1.1 $750MM Credit Facility (Unsecured) - - - - Pro rata share
Slide 21: Portfolio Composition
1 Introduction to Paramount 2 Business Update 3 Balance Sheet & Capital Structure 4 Portfolio Composition 5 Paramount Club 6 ESG Strategy 7 Appendix 21
Slide 22: Irreplaceable Portfolio of Class A/Trophy Assets – New York
Irreplaceable Portfolio of Class A/Trophy Assets – New York 4 1 1633 5 900 Third 1 2 6 Broadway Avenue 3 8 ▪ 2.5MM ▪ 0.6MM 5 sq. ft. sq. ft. ▪ 96.4% ▪ 82.4% leased leased New York ▪ 25% of G A V (2) ▪ 4% of G A V (2) 2 1301 Avenue of 6 712 Fifth ▪ 8.7MM Square Feet the Americas Avenue ▪ 1.8MM ▪ 0.6M
Slide 23: Irreplaceable Portfolio of Class A/Trophy Assets – San Francisco
Irreplaceable Portfolio of Class A/Trophy Assets – San Francisco 1 One Market 5 55 Second Plaza Street San Francisco ▪ 1.6MM sq. ft. ▪ 0.4MM sq. ft. ▪ 94.7% ▪ 86.7% leased leased ▪ 4.3MM Square Feet ▪ 12% of G A V (2) ▪ 2% of G A V (2) ▪ 80.8% Leased (1) 2 One Front 6 111 Sutter ▪ 29% of GAV (2) Str
Slide 24: Fund & Managed Assets
Fund & Managed Assets 1 718 Fifth 4 CNBB Fund & Managed Avenue ▪ 19K sq. ft. ▪ 225K sq. ft. Assets ▪ New York ▪ Washington, D.C. ▪ 0.8MM Square Feet 2 745 Fifth Avenue ▪ 535K sq. ft. ▪ New York 3 700 Eighth Avenue ▪ 26K sq. ft. ▪ New York 24
Slide 25: Paramount Club
1 Introduction to Paramount 2 Business Update 3 Balance Sheet & Capital Structure 4 Portfolio Composition 5 Paramount Club 6 ESG Strategy 7 Appendix 25
Slide 26: Introducing Paramount Club
Introducing Paramount Club PA R A M O U N T C LU B Welcome to a new era of business. One where the bounda ries between work a nd inspiration blur. W here innovation is met with integ rity a nd a mbitions a re ignited. W here intellectua l excha nge is the cur rency a nd ca ma raderie is the dividend
Slide 27: Paramount Club Transcends Traditional Amenities
Paramount Club Transcends Traditional Amenities C O N C E N T R AT E & C O L L A B O R AT E Pr ior itize productivity a nd forge mea n ing fu l con nections. We ha ve a ra nge of flexible options to su it you r i nd ividua l schedu le a nd style of work: AU D I TOR IUM B USINESS LOUNGE TR A I NI NG
Slide 28: Excellence Has an Address
Excellence Has an Address DESTINAT I O N COMMUNITY Pa ra mount C lub is a destination that Pa ra mount C lub is a dy na mic brings together a dy na mic community of community of a ccomplished a ccomplished professiona ls. professiona ls who pursue excellence in a ll dimensions. 28
Slide 29: Paramount Club in Depth
Paramount Club in Depth Paramount Club is a dynamic community of accomplished professionals. Loca ted in the hea r t of M idtown M a nha tta n, a t 6th Ave a nd 52nd S treet, we offer 32,0 0 0S F of exper tly a ppointed d ining, wellness, conferencing, a nd enter ta inment exper iences to su it thei
Slide 30: ESG Strategy
1 Introduction to Paramount 2 Business Update 3 Balance Sheet & Capital Structure 4 Portfolio Composition 5 Paramount Club 6 ESG Strategy 7 Appendix 30
Slide 31: ESG Commitment
ESG Commitment • Paramount continues to be an industry leader in ESG initiatives. Success in this space has helped us: • Manage operating costs, • Attract and retain premium tenants, and ultimately • Enhance portfolio value. • Pursuing ESG strategies has positioned us, our partners, and our investor
Slide 32: ESG Oversight & Integration
ESG Oversight & Integration • Our Board of Directors vested the Audit Committee with oversight over Environmental and Social matters. Oversight for Governance resides with the Nominating & Corporate Governance Committee. • Sustainability Committee has been created to implement the Company’s ESG goal
Slide 33: Sustainability from Coast to Coast
Sustainability from Coast to Coast 33
Slide 34: ESG Highlights
ESG Highlights Note: Slide reflects Office REIT Portfolio 34
Slide 35: ESG Frameworks – History of Improvements
ESG Frameworks – History of Improvements Framework 0-10; lower Negligible- Scoring A-F Y/N 1-5 Stars AAA-CCC Y/N Y/N Y/N is better Severe E=10 No 2018 N 4 Stars N/A S=10 N N N/A N Response G=7 E=4 No 2019 N 5 Stars BB S=1 Y N N/A N Response G=7 E=4 2020 C N 5 Stars BB S=2 Y N Low N G=8 E=2 2021 B- Y
Slide 36: Corporate Reduction Goals
Corporate Reduction Goals • Paramount has set ambitious reduction targets for energy, emissions, water, and waste that we are on track to achieve by 2025. • These targets encourage innovation, garner Executive Management and Board-level attention, and galvanize reduction efforts across the entire or
Slide 37: Pathway to Decarbonization
Pathway to Decarbonization Setting an interim emission reduction target to drive action 100% of electricity used matched by renewable purchases Lowering the on-site energy consumption of our portfolio Pilot internal shadow carbon price Replacing fossil fuel burning equipment with electric Report Sco
Slide 38: Diversity, Equity & Inclusion (DE&I) Strategy
Diversity, Equity & Inclusion (DE&I) Strategy We are committed to expand our DE&I initiatives, which include additional disclosures on these issues. • Oversight of DE&I aspects by two committees of the Board (Audit, NCGC) • Increase the consideration of diverse candidates for Board-level positions •
Slide 39: Appendix
1 Introduction to Paramount 2 Business Update 3 Balance Sheet & Capital Structure 4 Portfolio Composition 5 Paramount Club 6 ESG Strategy 7 Appendix 39
Slide 40: Reconciliation of Non-GAAP Measures – FFO
Reconciliation of Non-GAAP Measures FFO (unaudited and in thousands, except share and per share amounts) Three Months Ended Year Ended December 31, 2023 December 31, 2022 September 30, 2023 December 31, 2023 December 31, 2022 Reconciliation of net loss to FFO and Core FFO: Net loss $ (271,727) $ (39
Slide 41: Reconciliation of Non-GAAP Measures – NOI
Reconciliation of Non-GAAP Measures NOI (unaudited and in thousands) Three Months Ended Year Ended December 31, 2023 December 31, 2022 September 30, 2023 December 31, 2023 December 31, 2022 Reconciliation of net loss to NOI and Cash NOI: Net loss $ (271,727) $ (39,581) $ (25,061) $ (371,303) $ (28,1
Slide 42: Reconciliation of Non-GAAP Measures – Same Store Cash NOI
Reconciliation of Non-GAAP Measures SAME STORE RESULTS - CASH NOI (unaudited and in thousands) SAME STORE CASH NOI (1) Three Months Ended December 31, 2023 Total New York San Francisco Other PGRE's share of Cash NOI for the three months ended December 31, 2023 $ 87,805 $ 61,918 $ 26,657 $ (770) Leas
Slide 43: Reconciliation of Non-GAAP Measures – Same Store NOI
Reconciliation of Non-GAAP Measures SAME STORE RESULTS - NOI (unaudited and in thousands) SAME STORE NOI (1) Three Months Ended December 31, 2023 Total New York San Francisco Other PGRE's share of NOI for the three months ended December 31, 2023 $ 92,533 $ 64,423 $ 28,850 $ (740) Lease termination i
Slide 44: Appendix: Definitions
Appendix: Definitions Annualized Rent represents the end of period monthly base rent plus escalations in accordance with the lease terms, multiplied by 12. Funds from Operations ("FFO") is a supplemental measure of our performance. FFO is presented in accordance with the definition adopted by the Na
Slide 45: Appendix: Definitions (Cont’d)
Appendix: Definitions (Cont’d) PGRE’s Share of Total Debt represents our share of debt of consolidated and unconsolidated joint ventures, based on our percentage ownership in the underlying assets. We believe that PGRE’s share of total debt provides useful information to investors regarding our fina
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