Independence Realty Trust, Inc. · NYSE:IRT
Independence Realty Trust — Investor Presentation (June 2016)
28 slides from Independence Realty Trust's investor presentation, Jun 6, 2016
Slide 1: Independence Realty Trust June 2016
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Slide 2: Forward-looking statements
This presentation may include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on current expectations, estimates and projections ab
Slide 3: Who are we?
IRT is a REIT focused on building a portfolio of well-located apartment properties which generate attractive risk adjusted returns, stable occupancy and the potential for property appreciation through rent increases and improved operating efficiency 9.23%(2) dividend yield; listed on the NYSE MKT in
Slide 4: Experienced management team
Scott F. Schaeffer Chairman & CEO Chairman and CEO – Independence Realty Trust, Inc. Over 16 years at RAIT Financial Trust serving in a variety of roles Extensive real estate experience (over 30 years) specializing in acquiring and financing commercial real estate Previously, led the real estate gro
Slide 5: Investment Highlights
Portfolio With Stable Growth and Resilient Through Economic Cycles Highly Attractive Industry and Market Fundamentals Commitment to Prudently Recycling Capital Enhanced Scale and Improved Portfolio Quality and Market Penetration Post Trade Street Merger Strong Sponsor with Significant Alignment of I
Slide 6: Enhanced Scale and Improved Portfolio Quality Post Trade Street Merger
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Slide 7: TSRE Acquisition Consistent with External Growth Track Record
TSRE Acquisition Consistent with External Growth Track Record At IPO (August 16, 2013) Pre TSRE Merger (September 30, 2015, excludes TSRE) Post TSRE Merger (March 31, 2016) Total # of Properties 8 31 48 Total # of Units 2,004 9,055 13,502 Average Base Rent ($)(1) $791 $848 $952 Average Occupancy (%)
Slide 8: TSRE Acquisition Accelerates Market Penetration
TSRE Acquisition Accelerates Market Penetration Legacy IRT properties Recent Disposition Economies of Scale Legacy TSRE properties Source: Company information.
Slide 9: Commitment to Prudently Recycling Capital
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Slide 10: Commitment to Prudently Recycling Capital
Commitment to Prudently Recycling Capital Continuously evaluate whether to sell properties to strengthen presence in target markets by considering: Whether the asset has reached its economic potential Market and economic conditions Property margins and ongoing capital requirements Source: Company in
Slide 11: Portfolio With Stable Growth and Resilient Through Economic Cycles
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Slide 12: Affordable B/B+ Grade Positioning Highly Defensive
Affordable B/B+ Grade Positioning Highly Defensive A B C Homeownership rates declining Higher income tenants move down in a recession Renters move down to Class B as aggressive rent increases outstrip income growth Capture households moving down in a recession Capture seniors who sell homes to fund
Slide 13: Stable Cash Flow Profile
Stable Cash Flow Profile Historic Rent / Unit Growth IRT Top 5 Submarkets(1) vs Gateway Markets Source: REIS, Company filings. Markets comprise Atlanta, Austin, Louisville, Memphis and Oklahoma City. Weighted by number of units. Same store growth disclosed. AvalonBay Communities, Inc. (“AVB”), Equit
Slide 14: Highly Attractive Industry and Market Fundamentals
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Slide 15: Attractive Apartment Industry Dynamics Support Strong Demand
Attractive Apartment Industry Dynamics Support Strong Demand Positive Demographic Factors Demand for rental housing will remain strong as a result of a strengthening job market and positive household formation growth Population growth in IRT’s markets have grown by 1.44% in 2015 compared to 1.07% in
Slide 16: Positive Demographics
Positive Demographics Migration Outpacing New Supply Projected Net Migration / Projected Completions(1) Represents the number of people migrating to markets for every one unit delivered Population Growth Source: REIS Data, RAIT Financial Trust. Completions data for the IRT markets of Asheville NC, J
Slide 17: Strong Employment Outlook
Strong Employment Outlook Job Growth Outpacing New Supply Projected Jobs / Projected Completions(1) Employment Growth Source: REIS Data, RAIT Financial Trust. Completions data for the IRT markets of Asheville NC, Jackson MS, and Huntsville AL are not tracked by REIS and therefore projected migration
Slide 18: Household Formation
Household Formation Household Formation Growth(1) Source: REIS Data, RAIT Financial Trust, Census 2016 figures are projections as reported by REIS as of Q1 2016. IRT weighted averages are based on the company’s owned properties as of May 2016. Household formation data for the IRT markets of Ashevill
Slide 19: Strong Sponsor with Significant Alignment of Interests
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Slide 20: Sponsored by RAIT
Sponsored by RAIT Multi-strategy commercial real estate company with $5.9 billion of assets under management as of March 31, 2016 RAIT’s IPO – January 1998 Scalable “in-house” commercial real estate platform Over 800 employees including property management personnel In-house legal team, asset manage
Slide 21: Strong Alignment of Interests Between Sponsor and Stockholders
RAIT is the largest stockholder in IRT with 7.3 million shares or approximately 15% of IRT’s outstanding common stock as of June 1, 2016 RAIT controls entities that advise and manage IRT and its properties Externally managed by Independence Realty Advisors, a wholly-owned subsidiary of RAIT Properti
Slide 22: Investment Highlights
Portfolio With Stable Growth and Resilient Through Economic Cycles Highly Attractive Industry and Market Fundamentals Commitment to Prudently Recycling Capital Enhanced Scale and Improved Portfolio Quality and Market Penetration Post Trade Street Merger Strong Sponsor with Significant Alignment of I
Slide 23: Appendix
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Slide 24: Financial & Operational Highlights
Financial & Operational Highlights (a)Same store includes 28 properties which represents 8,277 units. (b)Net debt equals total debt less cash and cash equivalents. Annualized assuming the TSRE merger which closed September 17, 2015 occurred at the beginning of the period. See appendix for reconcilia
Slide 25: Reconciliation of NOI to GAAP net income (loss)
Reconciliation of NOI to GAAP net income (loss) (Dollars in thousands, except share and per share amounts) NET OPERATING INCOME (NOI) BRIDGE Dollars in thousands For the Three-Months Ended March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015 March 31, 2015 Reconciliation of NOI to GAAP
Slide 26: Reconciliation of Net Income to FFO and Core FFO
Reconciliation of Net Income (loss) to Funds From Operations and Core Funds From Operations (Dollars in thousands, except share and per share amounts) STATEMENTS OF OPERATIONS, FFO & CORE FFO TRAILING 5 QUARTERS Dollars in thousands, except per share data For the Three-Months Ended March 31, 2016 De
Slide 27: Reconciliation of Adjusted EBITDA to Net Income
Reconciliation of Adjusted EBITDA, Before Acquisition Expenses to Net Income (loss) (Dollars in thousands, except share and per share amounts) ADJUSTED EBITDA RECONCILIATIONS Dollars in thousands For the Three-Months Ended March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015 March 31, 2
Slide 28: Definitions
Definitions Average Effective Monthly Rent per Unit Average effective rent per unit represents the average of gross rent amounts, divided by the average occupancy (in units) for the period presented. We believe average effective rent is a helpful measurement in evaluating average pricing. This metri
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