Slate Grocery Reit Class U · TSX:SGR.U
Slate Grocery Reit Class U — Q2 2024 Earnings Presentation
23 slides from Slate Grocery Reit Class U's earnings presentation, Aug 7, 2024
Slide 1: Slate Grocery REIT Investor Update Q2 2024
Slate Grocery REIT Investor Update Q2 2024
Slide 2: Slate Grocery REIT – Overview
Slate Grocery REIT – Overview 95% Pure-play grocery- anchored focused SGR.UN TSX-Listed $2.4B Asset value 1, 2 116 Properties All U.S. locations 1 15.2M Square feet 1 23 States 1 $12.56 PSF in-place rent 1 Note: Amounts are in US$. 1 As of June 30, 2024. 2 Amount is shown at proportionate interest,
Slide 3: Outlook on Grocery
Outlook on Grocery Wedgewood Commons, Port St. Lucie, FL
Slide 4: Why Grocery Real Estate?
Why Grocery Real Estate? Necessity Based Critical to day-to-day life Defensive Asset Class Historical outperformance in periods of economic volatility Facilitates Omni-Channel Distribution All purchase methods require brick-and-mortar stores Supply Chain Efficiencies Stores near end-consumers optimi
Slide 5: Consumers Require Essential Goods in Good and Bad Times
Consumers Require Essential Goods in Good and Bad Times Food retailers comprise 18 of the 25 largest consumer good distributors globally1 Top 25 Global Retailers, Ranked by Revenue Walmart Inc Amazon Costco Schwarz Group Home Depot Kroger Non-Food JD.com Retailer, Walgreens 19% Aldi Target CVS Lowe'
Slide 6: Retail Space is Supply Constrained
Retail Space is Supply Constrained Retail has experienced the lowest amount of new supply amongst competing property types and is projected to sustain this favorable trend in coming years Cumulative New Supply – Historical and Forecasted 14.0% 12.0% 11.6% 10.0% 9.5% 9.5% 8.7% 8.0% 6.0% 5.8% 4.0% 2.2
Slide 7: Grocery Stores Facilitate the Last Mile
Grocery Stores Facilitate the Last Mile Grocery stores play a critical role in distributing food and other essential goods to end consumers by facilitating the last mile of food logistics 89% Over 94% of grocer sales are fulfilled using of Grocer Sales physical stores In Store Purchasing 5% of Groce
Slide 8: Shopping Center Fundamentals Remain Strong
Shopping Center Fundamentals Remain Strong Demand for grocery-anchored centers and limited new construction has resulted in record-low new supply and accretive rent mark-to-market opportunities Shopping Centers – Rent Comparison1 Shopping Centers – Overall Vacancy & Base Rent2 $PSF per annum $23.50
Slide 9: Operations and Strategy Update
Operations and Strategy Update Tanglewood Commons, Winston-Salem, NC
Slide 10: World Class Grocery and Essential Based Tenants
World Class Grocery and Essential Based Tenants Top five tenants Essential tenancies Omnichannel distribution SGR’s portfolio is comprised of the world’s High concentration of essential and grocery SGR’s properties are key to the distribution largest, most sophisticated, credit-worthy tenants of in-
Slide 11: Strong Presence in Growing Markets
Strong Presence in Growing Markets Top States #3 New York > 11% of GLA 5% - 10% of GLA % of GLA 11% < 5% of GLA # of Properties 12 #2 Top 5 MSAs North Carolina % of GLA Dallas 5% % of GLA 13% Atlanta 5% # of Properties 16 Charlotte 5% Greenville 4% Rochester 4% #4 Georgia % of GLA 7% Top 5 Regions #
Slide 12: Upside Through Under Market Rents
Upside Through Under Market Rents Historically low vacancy rates combined with under market rents provide significant opportunity to grow NOI across the portfolio 6.5% Shopping Center Vacancy Rate1 $25.00 $21.80 $22.51 $23.06 $23.38 $20.96 $21.30 $20.00 39.1% GLA Expiring in the next 3 years In-Plac
Slide 13: Near-Term Loan Maturities
Near-Term Loan Maturities SGR is engaged in positive discussions with lenders to extend its upcoming corporate revolver and term loan facilities that expire in 2024 & 2025 94.8% $500 33% $450 4.5% $400 Weighted Avg. $350 23% Interest Rate 21% $300 Fixed Rate Debt $250 $200 12% $150 $100 $50 2% 5% 4%
Slide 14: Operational Excellence
Operational Excellence Strong Leasing Fixed-Rate Debt ESG Integration 707K +10.0% 94.8% 349 1.4M Total SF Total Spread As of Q2 2024 Signed Green Leases Total Square Footage Robust leasing volumes Fixed majority of the REIT’s Advanced key ESG initiatives at strong rental rate debt & actively address
Slide 15: The Investment Opportunity
The Investment Opportunity Sheridan Square, Miami-Fort Lauderdale, FL
Slide 16: Trading Discount to Net Asset Value
Trading Discount to Net Asset Value Significant discount to NAV despite having the lowest in-place rents and highest grocery-anchored percentage $32.02 $32.07 8.3% $24.63 7.5% $23.39 7.4% 7.4% 7.2% $22.39 6.9% 6.9% $19.95 6.6% $20.84 $20.09 $20.69 $20.29 6.8% 6.8% $17.12 6.0% 5.9% 5.9% $15.24 $12.56
Slide 17: Environmental, Social & Governance
Environmental, Social & Governance ESG Priorities Current ESG Initiatives • Energy, carbon, water and waste data collection will support Managing climate change risks and opportunities IFRS/ISSB 1 sustainability and climate reporting requirements. • Energy audits are being considered to support the
Slide 18: Closing Thoughts
Closing Thoughts Grocery-anchored real estate facilitates the last mile of food logistics and has proven its resiliency and ability to perform in various market conditions The REIT’s in-place rents are significantly below market, providing runway for long-term revenue growth and value creation Manag
Slide 19: Additional Information
Additional Information Mooresville Town Square, Mooresville, NC
Slide 20: Strong Corporate Governance
Strong Corporate Governance Compensation, Governance Independent Audit Committee Investment Committee and Nominating Committee Andrea Stephen Yes Member Chair Member (Chair of the Board) Colum Bastable Yes Chair Member Member Christopher Chee Yes Member Patrick Flatley Yes Member Marc Rouleau Yes Me
Slide 21: Analyst Coverage
Analyst Coverage CIBC Capital Markets Raymond James Sumayya Syed Brad Sturges sumayya.syed@cibc.com brad.sturges@raymondjames.ca Cormark Securities RBC Capital Markets Sairam Srinivas Pammi Bir ssrinivas@cormark.com pammi.bir@rbccm.com Scotiabank Himanshu Gupta himanshu.gupta@scotiabank.com Slate Gr
Slide 22: Disclaimer
Disclaimer Forward-Looking Statements This presentation contains forward-looking information within the meaning of applicable securities laws. These statements include, but are not limited to, statements concerning the REIT’s objectives, its strategies to achieve those objectives, as well as stateme
Slide 23: Slate Asset Management contact
Slate Asset Management 121 King Street W, Suite 200 Toronto, ON M5H 3T9 slateam.com