W. P. Carey Inc. Reit · NYSE:WPC
W. P. Carey Inc. Reit — Carey W P & — New York Society of Security Analysts 14th Annual REIT Conference (April 2004)
27 slides from W. P. Carey Inc. Reit's conference presentation, Apr 14, 2004
Slide 1: WPC Corporate Overview
WPC Corporate Overview New York Society of Security Analysts 14 th Annual REIT Conference April 14, 2004 Serving Investors Since 1973 © Copyright W. P. Carey & Co. LLC 2004
Slide 2: Table of Contents
Table of Contents 2 Page Corporate Overview 3-5 Market Opportunity 6 Unique Business Model 7-8 Diversified Stable Portfolio 9-11 Management/Advisory Business 12-17 W. P. Carey Fundamentals 18-26 Running the Business as Owners 27
Slide 3: Returns Since W. P. Carey's Merger in 2000
Corporate Overview Returns Since W. P. Carey’s Merger in 2000 3 50 75 100 125 150 175 200 225 250 6/28/2000 2000 2001 2002 2003 WPC NAREIT S&P 500
Slide 4: Growth in FFO since NYSE listing in 1998
Since listing on the NYSE in 1998, funds from operations have grown at a 17% compound annual growth rate. Growth in FFO Corporate Overview ($ in millions) 4
Slide 5: Leading Sale-Leaseback Investor
Corporate Overview Leading Sale-Leaseback Investor 30 years as premier sale-leaseback investor Expertise across many industries Ability to underwrite extremely complex transactions 5
Slide 6: Domestic Market Opportunity
Approximately 24% of commercial real estate is owner-occupied, representing over $1 trillion in investment opportunity Domestic Market Opportunity Ownership of U.S. Commercial Real Estate* *(Source: Jones Lang LaSalle) 6
Slide 7: Unique Business Model
Unique Business Model W. P. Carey & Co. LLC OWNS MANAGES Generates 54% of its revenue by managing day-to-day operations and new real estate investments $800 million in net-leased real estate Generates 46% of its revenue through rental income from its owned assets. $4.4 billion in net-leased real est
Slide 8: Why a Limited Liability Company (LLC)?
Unique Business Model LIMITED LIABILITY COMPANY OWNS C Corp Carey Asset Management CURRENT STRUCTURE MANAGES Taxation – More efficient than REIT or C-Corp. Minimizes corporate level taxation Operating flexibility – Less restrictive than a REIT on sources of revenue and real estate business activity
Slide 9: Diversified Stable Portfolio
W. P. Carey & Co. LLC OWNS $800 million in net-leased real estate Generates 46% of its revenue through rental income from its owned assets. Diversified Stable Portfolio 9 MANAGES DIVERSIFIED STABLE PORTFOLIO
Slide 10: Diversified Income
Diversified Income 5.0% - 7.5% 0 2.5% - 5.0% 2 2.5% or Less 95 10 OWNS W. P. Carey & Co. LLC Diversified Stable Portfolio % of Total Revenues # of Tenants/Guarantors Only two tenants represent more than 2.5% of W. P. Carey’s total revenues MANAGES
Slide 11: CheckFree Corporation Corporate Office Headquarters Campus
Diversified Stable Portfolio Location: Norcross, GA Purchase Price: $42 million Lease Term: December 2015 Rent Escalation Provision: CPI Indexed CheckFree Corporation Corporate Office Headquarters Campus 11 OWNS W. P. Carey & Co. LLC MANAGES
Slide 12: Management/Advisory Business
Management/Advisory Business W. P. Carey & Co. LLC MANAGES Generates 54% of its revenue by managing day-to-day operations and new real estate investments. $4.4 billion in net-leased real estate 12 OWNS CPA ® REITS
Slide 13: Management/Advisory Business: Institutional and Individual Investors
Institutional - Carey Institutional Properties (CIP ® ) - Variety of pension fund clients - Formerly exclusive CalPERS advisor for net lease asset class Individual - Corporate Property Associates (CPA ® ) series - More than 80,000 investors in CPA ® funds - Sold through relationships with UBS Financ
Slide 14: Unusually Valuable Franchise
Unusually Valuable Franchise Superior Performance - All funds have met or exceeded investor expectations - No full-term investor has lost money in any program - Ten programs have gone full cycle to liquidity with average annual return of 12% - Distributed 680 dividends with 89% of those larger than
Slide 15: Convergence of Two Major Trends
Convergence of Two Major Trends Investor interest in yield investments Corporations facing capital market constraints Investor interest in yield investments and stability Corporate capital constraints and desire to shed real estate W. P. Carey & Co. LLC Management/Advisory Business W. P. Carey & Co.
Slide 16: Growth in Assets Under Ownership and Management
($ in millions) Growth in Assets Under Ownership and Management W. P. Carey & Co. LLC MANAGES Total assets under management and ownership have grown at a compound annual rate of 23% over the last 24 years Management/Advisory Business 16 OWNS
Slide 17: Assets Under Management Growth
Assets Under Management Growth Management/Advisory Business ($ in billions) Year-Over-Year Growth in Assets Under Management 26% December 2002 December 2003 W. P. Carey & Co. LLC MANAGES 17 billion billion OWNS
Slide 18: Serving Investors Since 1973
Serving Investore Since 1973 www.wpcarey.comt
Slide 19: WPC Financial Results
WPC Financial Results (in thousands except per share amounts) 19 Revenues: $92,500 $86,670 $80,840 $46,911 $84,255 $88,060 Expenses: $21,603 $16,134 $15,116 $29,435 $42,592 $43,698 Net Income: $35,761 $46,588 $62,878 $1.02 $1.28 $1.65 12 Months Ended 12 Months Ended 12 Months Ended 12/31/01 12/31/02
Slide 20: WPC Financial Results: Funds from Operations
WPC Financial Results (in thousands except per share amounts) Funds from Operations Funds from Operations (in millions) 20 $60 $80 $100 $120 2001 2002 2003 2003 2002 2001 $3.00 $2.80 $2.60 $2.40 $2.20 $2.00 Funds From Operations: $84,160 $102,013 $105,518 $2.41 $2.81 $2.78 $84 $102 $106 $2.78 $2.81
Slide 21: WPC Financial Results: Per Share and Balance Sheet
WPC Financial Results (in thousands except per share amounts) 21 Per Share: $2.41 $2.81 $2.79 $1.704 $1.72 $1.73 141% 163% 161% 34,952 36,265 38,008 Balance Sheet: $915,883 $893,524 $906,505 $200,515 $186,049 $180,193 $95,000 $49,000 $29,000 12 Months Ended 12 Months Ended 12 Months Ended 12/31/01 1
Slide 22: WPC Capital Structure
WPC Capital Structure (in thousands except per share amounts) 22 Market Capitalization: WPC $966,364 $209,193 $1,175,557 WPC NAREIT 82% 61% 18% 39% 2.5% 19% Source: NAREIT, SEC Filings, SNL DataSource Equity Market Capitalization Debt Market Capitalization Total Market Capitalization Equity % of Tot
Slide 23: WPC Conservative Approach
WPC Conservative Approach W. P. Carey & Co. and its affiliates continue to provide investors with a safe, steady flow of income and have paid more than 680 consecutive dividends. Dividend Coverage Since Listing 23
Slide 24: FFO Multiple vs. REIT Peer Group
FFO Multiple vs. REIT Peer Group W. P. Carey Current Valuation 24 Close 4/12/03 2003 FFO FFO Multiple AMB Property $32.10 $2.13 15.1 Alexandria Real Estate $57.75 $4.23 13.7 Capital Automotive REIT $29.42 $2.40 12.3 Commercial Net Lease Rlty $17.18 $1.46 11.8 Lexington Corp. Properties $19.25 $ 1.82
Slide 25: Dividend Yield vs. REIT Peer Group
Dividend Yield vs. REIT Peer Group W. P. Carey Current Valuation WPC is currently yielding over 240 basis points above the 10-Year Treasury while the NAREIT Equity Index is yielding 150 basis points above the 10-Year Treasury 25 Close 4/12/03 FFO Multiple Yield Div. Coverage AMB Property $32.10 15.8
Slide 26: FFO Multiple vs. Investment Manager Peer Group
FFO Multiple vs. Investment Manager Peer Group W. P. Carey Current Valuation 26 Close 4/12/03 2003 Net Income P/E Ratio Alliance Capital $36.93 $2.11 17.5 Franklin Resources $57.06 $2.22 25.7 BlackRock $63.90 $2.36 27.1 Eaton Vance $39.21 $1.60 24.5 Federated Investors $31.75 $ 1.83 17.3 Janus Capit
Slide 27: Running the Business as Owners
Running the Business as Owners 13.90% Fortune 500 16.71% Equity REIT Industry 8.16% Peer Group 39.70% WPC % of Management Ownership as of 2003 Proxy Season 27
Carey W P & — New York Society of Security Analysts 14th Annual REIT Conference (April 2004) on 6ix