Global Net Lease, Inc. · NYSE:GNL
Global Net Lease — Investor Presentation (May 2021)
34 slides from Global Net Lease's investor presentation, May 11, 2021
Slide 1: Global Net Lease Common Stock Offering
Global Net Lease Common Stock Offering Investor Presentation
Slide 2: Disclaimer
DISCLAIMER 2 References in this presentation to the "Company," "we," "us" and "our" refer to Global Net Lease, Inc . ("GNL") and its consolidated subsidiaries . This presentation makes no representations or warranties and no person has been authorized to make any representations on behalf of the Com
Slide 3: Company Highlights
COMPANY HIGHLIGHTS High - Quality, Mission Critical, Net Lease Focused Portfolio : High portfolio occupancy of 99.7% coupled with complete first quarter original Cash Rent collection of 100% (1) , highlighting strong overall operating performance 1 Strong Balance Sheet: Includes $500 million of seni
Slide 4: Portfolio Highlights
4 PORTFOLIO HIGHLIGHTS Portfolio Overview Q1’21 Q1’20 Properties 306 288 Square Feet (millions) 37.2 34.2 Tenants 130 126 Industries 48 46 Countries 10 9 Leased 99.7% 99.6% Weighted - Average Remaining Lease Term (1) 8.3 years 9.0 years % of SLR derived from Investment Grade Tenants (2)(3) 66.3% 66.
Slide 5: Strong Cash Rent Collection
5 STRONG CASH RENT COLLECTION Mission critical industrial and distribution assets and high Investment Grade rated tenancy (1) continued to support GNL’s strong first quarter collection rate of 100% of Original Cash Rent (2) First Quarter 2021 Rent Collection (Total Portfolio) First Quarter 2021 Rent
Slide 6: 100% Collected from Top Twenty Tenants
6 100% COLLECTED FROM TOP TWENTY TENANTS Collected 100% of first quarter Original Cash Rent due from top twenty Tenants (1) , representing 48% of first quarter Original Cash Rent Top Twenty Tenants Tenant Investment Grade Rating Country % of Q1’2021 Original Cash Rent Collected % of Portfolio Origin
Slide 7: Well Balanced Portfolio Supports Continued Growth
7 Investment Grade 66% Non - Investment Grade 34% Metal Processing 4% WELL BALANCED PORTFOLIO SUPPORTS CONTINUED GROWTH As of March 31, 2021. 1. Metric based on SLR . Refer to SLR definition included in the footnotes on page 4. 2. Refer to Investment Grade Rating definition included in the footnotes
Slide 8: Attractive Portfolio in Line with Investment Grade Rated Peers
8 ATTRACTIVE PORTFOLIO IN LINE WITH INVESTMENT GRADE RATED PEERS Well - positioned, diversified portfolio with large concentration of investment grade tenants as compared to investment grade rated peers Weighted - Average Remaining Lease Term (1) Occupancy Percentage Investment Grade Tenants (2) Ind
Slide 9: GNL Metrics Back to or Above Pre-Pandemic Level
9 Significant Upside Potential $60.1 $68.1 Q4'19 Q1'21 GNL METRICS BACK TO OR ABOVE PRE - PANDEMIC LEVEL 1. Cash Rent collected includes both contractual rents and deferred rents paid during the period. See Slide 4 for further detail s. 2. For Q1’21 Net Loss per Share was ($0.01) and for Q1’20, Net
Slide 10: Well Diversified Tenant Base
10 Tenant Rating Country Property Type % of SLR (1) Baa2** U.S. / Canada Distribution 4% Baa1 U.S. / Italy Industrial / Distribution 4% Aaa** U.S. Office 4% Baa3* U.K. Office 3% Aa3 NETH Office 3% Baa3* U.S. Industrial / Distribution 3% Baa1 U.S. Industrial 3% Baa2 U.S. Distribution 3% Aa1** FIN Ind
Slide 11: Focus on High-Quality Tenants
11 Office Distribution Industrial FOCUS ON HIGH - QUALITY TENANTS Only Focused on Markets with Quality Sovereign Debt Ratings (S&P) U.S. Luxembourg Germany The Netherlands Canada Finland U.K. France Spain Italy AA+ AAA AAA AAA AAA AA+ AA AA A BBB Moody’s: A1 Moody’s: Aaa Moody’s: Aa3 Moody’s: Aa3 Mo
Slide 12: Differentiated Investment Strategy
12 DIFFERENTIATED INVESTMENT STRATEGY Geography Asset Type Property Fundamentals Credit Quality Structure and Pricing • Focus on U.S. and strong sovereign debt rated countries in Continental Europe • Strategically located industrial and distribution facilities • Mission critical, single tenant net l
Slide 13: Second Quarter Acquisitions and Pipeline
13 *Represents Moody’s Implied Rating’ ** Represents Tenant or Guarantor Parent Rating even if not a guarantor on the lease. 1. Represents the contract purchase price and excludes acquisitions costs which are capitalized per GAAP. 2. Average Cap Rate is a rate of return on a real estate investment p
Slide 14: McLaren Transaction Overview
14 Transaction Overview Tenants McLaren Services Limited (2) McLaren Automotive (1) Property Type Industrial Location Woking , United Kingdom Purchase Price (1) $236.3 Square Feet 841,000 Lease Term (years) 20 Years Weighted Average Annual Rent Escalator 1.25% to 4.00% x In the second quarter 2021,
Slide 15: Second Quarter Acquisition: McLaren Group Global Headquarters
15 State - of - the - Art, Mission - Critical Campus : The award - winning campus serves as the world headquarters for McLaren and is well geographically located near Central London and Heathrow Airport, and hosts approximately 1,000 workers SECOND QUARTER ACQUISITION: MCLAREN GROUP GLOBAL HEADQUART
Slide 16: Global Geographic Balance
16 GLOBAL GEOGRAPHIC BALANCE Note: Metrics as of March 31, 2021 unless otherwise noted. 1. Refer to basis for metric calculation included in the footnotes on page 4. 2. Metric based on SLR. Refer to SLR definition included in the footnotes on page 4. U.S. and Canada Number of Assets: 237 Weighted -
Slide 17: Portfolio Enhancement
17 Office 48% Industrial/Distribution 47% Retail 5% United States & Canada 65% Europe 35% Office 46% Industrial/Distribution 49% Retail 5% PORTFOLIO ENHANCEMENT Continued Focus Towards Industrial and Distribution Properties and Geographic Diversification United States 65% Europe 35% Property Type Co
Slide 18: Lease Extensions and Expiration Schedule
18 In Q1’21, GNL completed three strategic lease extensions and executed an LOI for another lease renewal and expansion project, encompassing 626,000 square feet and $4.1 million of annual base rent if the LOI leads to a definitive agreement (1) Q1’21 Lease Extensions (2) Auchan Lease Extension and
Slide 19: Management and Governance
19 • Joined GNL as an Independent Board Member on March 2017 • Currently serves as an independent director and chairman of the audit committee for Roman DBDR Tech Acquisition Corp. • Previously served in various roles on the Boards of Herbalife Nutrition Ltd., Caesars Entertainment Inc., Icahn Enter
Slide 20: First Quarter 2021 Key Highlights
20 $36.2 $40.4 Net Loss Common Stock Dividends AFFO ($0.8) Net Loss Common Stock Dividends AFFO Q1’21 Net Loss, AFFO (5) and Common Stock Dividends ($mm) First Quarter 2021 Key Highlights • Total second quarter closed and pipeline acquisitions of $257 million with a Going - in Cap Rate of 9.3% and a
Slide 21: Recent $500 Million Notes Offering
21 Transaction Highlights • On December 16, 2020, GNL completed a $500 million senior unsecured notes offering. The notes are rated investment grade by S &P and BB+ rated by Fitch. The notes issuance represents a significant milestone as GNL focuses on issuing more unsecured debt on attractive term
Slide 22: Continued Focus on Driving Earnings Growth
22 $3,173 $3,421 $3,763 $4,319 $4,295 1/1/2017 1/1/2018 1/1/2019 1/1/2020 1/1/2021 CONTINUED FOCUS ON DRIVING EARNINGS GROWTH Historical Revenue Growth Core Funds From Operations (1) Real Estate Assets at Cost Adjusted Funds From Operations (1) $259 $282 $306 $330 $358 2017 2018 2019 2020 Q1'21 Annu
Slide 23: Key Debt Metrics and Maturity
23 $11 $21 $331 $227 $82 $690 $126 $290 $ 500 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 2021 2022 2023 2024 2025 Thereafter Mortgages Credit Facility Unsecured Notes 1% 4% 6% 12% 9% 6% 2% 11% 49% KEY METRICS Metric Q1’2021 Net Debt to Enterprise Value (1) 49.9% Net Debt to Adjusted EBITDA (annuali
Slide 24: Enhanced Capital Structure
24 5.4 5.2 5.1 5.4 5.1 3.1% 3.2% 3.1% 3.3% 3.3% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 0.0 1.0 2.0 3.0 4.0 5.0 6.0 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Weighted-Average Maturity Weighted-Average Interest Rate ENHANCED CAPITAL STRUCTURE GNL’s recent $500 million notes offering added capital
Slide 25: Appendix
GNL D GLOBAL NET LEASE APPENDIX
Slide 26: Comprehensive Hedging Program
26 COMPREHENSIVE HEDGING PROGRAM Hedging Foreign Currency Exchange Risk • Provides protection against a weakening in the value of EUR and GBP versus the U.S. Dollar associated with the Company’s foreign property operations Interest Rate Swaps: Fixing Interest on Floating Rate Debt • Cost effective t
Slide 27: Risk Factors
27 RISK FACTORS The following are some of the risks and uncertainties, although not all risks and uncertainties, that could cause our actual results to differ materially from those presented in our forward - looking statements . • We may be unable to acquire properties on advantageous terms or our p
Slide 28: Risk Factors (Continued)
28 RISK FACTORS (CONTINUED) • In owning properties we may experience, among other things, unforeseen costs associated with complying with laws and regulations and other costs, potential difficulties selling properties and potential damages or losses resulting from climate change . • We depend on our
Slide 29: Definitions
29 DEFINITIONS • Due to certain unique operating characteristics of real estate companies, as discussed below, the National Association of Real Estate Investment Trusts ("NAREIT"), an industry trade group, has promulgated a measure known as funds from operations ("FFO"), which we believe to be an ap
Slide 30: Definitions (Continued)
30 DEFINITIONS (CONTINUED) • In calculating Core FFO, we start with FFO, then we exclude certain non - core items such as acquisition, transaction and other costs, as well as certain other costs that are considered to be non - core, such as debt extinguishment costs, fire loss and other costs relate
Slide 31: Definitions (Continued)
31 DEFINITIONS (CONTINUED) • Excluding income and expense items detailed above from our calculation of AFFO provides information consistent with management's analysis of the operating performance of the Company . Additionally, fair value adjustments, which are based on the impact of current market f
Slide 32: Non-GAAP Reconciliations
32 NON – GAAP RECONCILIATIONS Three Months Ended March 31, 2021 March 31, 2020 EBITDA: Net income (loss) $ 4,184 $ 9,601 Depreciation and amortization 39,684 33,533 Interest expense 21,368 16,440 Income tax expense 2,080 959 EBITDA 67,316 60,533 Equity based compensation 2,577 2,488 Acquisition, tra
Slide 33: FFO and AFFO Reconciliations
33 FFO AND AFFO RECONCILIATIONS Three Months Ended March 31, 2021 March 31, 2020 December 31, 2019 Funds from operations (FFO): Net (loss) income attributable to common stockholders (in accordance with GAAP) $ (832) 5,038 9,263 Depreciation and amortization 39,684 33,533 31,989 Gain on dispositions
Slide 34: Annual FFO and AFFO Reconciliations
34 ANNUAL FFO AND AFFO RECONCILIATIONS Twelve Months Ended December 31, 2017 December 31, 2018 December 31, 2019 December 31, 2020 Funds from operations (FFO): Net income (loss) attributable to common stockholders (in accordance with GAAP) $ 20,731 1,082 34,535 (7,775) Impairment charges — 5,000 6,3