Granite Real Estate Investment Trust · TSX:GRT.UN
Granite Real Estate Investment Trust — Investor Presentation (November 2019)
20 slides from Granite Real Estate Investment Trust's investor presentation, November 2019
Slide 1: Granite REIT Investor Presentation November 2019
GRANITE REIT Investor Presentation November 2019
Slide 2: Presentation of Certain Information
PRESENTATION OF CERTAIN INFORMATION Unless otherwise indicated in this presentation, all information is presented as of September 30, 2019 and all financial information that is identified as refers to the three month period ending September 30, 2019. For definitions of certain non-IFRS measures used
Slide 3: Granite Highlights
GRANITE HIGHLIGHTS ORGANIZATIONAL PRINCIPLES PORTFOLIO OVERVIEW FINANCIAL PERFORMANCE 82 income-producing Long-term total return focused properties + 6 development 78% AFFO POR Q3 2019 properties 15% net leverage ratio Conservative and flexible 36.1M square feet capital structure GRT.UN on TSX and G
Slide 4: Granite Highlights – ESG
GRANITE HIGHLIGHTS – ESG ENVIRONMENTAL SOCIAL GOVERNANCE Promote energy efficiency and sustainable practices at our 100% independent Board Promote employee well-being excluding CEO properties Reduce use of resources and Experienced board members promote waste diversion Promote volunteerism and with
Slide 5: Granite's Evolution
GRANITE’S EVOLUTION Income-Producing Properties Summary Then - December 31, 2011 Now - September 30, 2019 13.8M SF 6.8M SF 14.1M SF Multi-Purpose Multi-Purpose Special Purpose $827M 20.8M SF $802M $1,089M Modern $4.0B Logistics/Distribution $1.9B $2,137M Value Value 8.9M SF Special Purpose $1,008M 2
Slide 6: Portfolio Transformation Strategy
PORTFOLIO TRANSFORMATION STRATEGY Invest Focus on modern facilities that selectively/opportunistically in Target markets with superior meet the demands of evolving property types and economic conditions and market E-Commerce and traditional markets benefiting from fundamentals distribution users tec
Slide 7: Financial Performance
FINANCIAL PERFORMANCE Historical Operating Performance ($M) Distributions and Payout Ratios 91% $245 82% 80% 85% $231 71% 78% 78% $223 $223 78% $216 $214 71% 69% 68% 68% $2.80 $203 $2.72 $196 $2.60 $188 $187 $185 $2.43 $183 $181 $181 $2.30 $170 $170 $2.21 $2.11 $162 $158 $158 $159 $1.99 $154 $145 $1
Slide 8: GRT Historical Performance
GRT HISTORICAL PERFORMANCE Total Return vs TSX Composite & TSX Capped REIT Indices Cumulative Total Return % Annualized Total Return % 220% 30% 208.5% 195% 25% 170% 145% 20% 120% 96.9% 15% 95% 70% 10% 74.3% 45% 5% 20% 0% -5% 1Yr 2Yr 3Yr 5Yr Granite REIT TSX Capped REIT Index TSX Composite Index Gran
Slide 9: Globally Diversified Portfolio
GLOBALLY DIVERSIFIED PORTFOLIO Nine countries - 88 properties - 36.1 million square feet GERMANY 11 properties 3.5M SF POLAND 2 properties 0.3M SF ENGLAND CANADA 1 property 0.1M SF 26 properties 5.9M SF CZECH NETHERLANDS REPUBLIC 4 properties 1 property UNITED STATES 1.7M SF 0.3M SF 31 properties 16
Slide 10: Portfolio Segmentation by Geography
PORTFOLIO SEGMENTATION BY GEOGRAPHY By Income Producing Property Fair Value By Annualized Revenue $630M $40.4M 16% 16% $48.5M 20% 24% $950M $799M 21% $4.0B $247M 25% $62.7M 39% $95.0M 39% $1,593M By Square Feet By Number of Income-Producing Properties 5.9M SF 6.0M SF 17% 16% 18 22% 32% 26 8.1M SF 23
Slide 11: Portfolio Segmentation by Category
PORTFOLIO SEGMENTATION BY CATEGORY Income-Producing Properties by Value Segmented by Category Multi-Purpose Properties 36 Properties 6.8 M SF (∼189K SF/property) $0.83 B Fair Value (∼$122/SF) WALT: 5.4 years $52.4 M Annualized Revenue (∼$7.69/SF) 21% Magna Concentration: 76% Concentration in the GTA
Slide 12: Development Pipeline
DEVELOPMENT PIPELINE Dallas, Texas Plainfield, Indiana Altbach (Stuttgart), Germany Mississauga, Ontario Incorporate development into our growth plans to enhance total return & platform value 12
Slide 13: Lease Expiration Profile
LEASE EXPIRATION PROFILE Lease Expiration by Annualized Revenue Annualized Overall Revenue $247M WALT 6.0 Years Occupancy 99.7% 60 Canada USA Austria Europe 42.7% 50 23.6% Annualized Revenue (C$M) 40 30 13.6% 12.9% 20 5.2% 10 2.0% 0.0% 0 2019 2020 2021 2022 2023 2024 2025+ % of Annualized Rev. 0.0%
Slide 14: High Quality & Creditworthy Tenant Base
HIGH QUALITY & CREDITWORTHY TENANT BASE Annualized Credit Top 10 Tenants GLA % WALT Revenue % Rating Other Tenants Magna 43% 37% 5.5 A (low) Global E-Commerce Provider 6% 6% 20.0 AA (low) ADESA 3% 1% 9.8 BB (low) Restoration Hardware 3% 3% 8.6 NR Ingram Micro 2% 3% 5.3 BBB (low) MARS Petcare 2% 3% 2
Slide 15: Balance Sheet Strength
BALANCE SHEET STRENGTH Capitalization Debt Maturity Profile Unit Price (10/31/2019) $65.22 $600 Units Outstanding 54.1 $500 Market Capitalization $3,525 $400 Credit Facility $0 (C$M) Debentures 3.788% due Jul/21 $250 $300 Debentures 3.873% due Nov/23 $400 $200 Term Loan 0.522% due Dec/24 $245 Term L
Slide 16: Credit Metrics Summary
CREDIT METRICS SUMMARY • The following table was sourced from DBRS’ Canadian Real Estate Peer Comparison dated May 2019. DBRS Canadian Real Estate Peer Comparison1: Peer Group Granite Rank Granite Average Among Peer Group Total Debt to Capital 32.4% 48.8% #2 Total Debt to EBITDA 6.5x2 9.6x #1 Cash F
Slide 17: Financial Flexibility & Target Long-Term Leverage Ratio
FINANCIAL FLEXIBILITY & TARGET LONG-TERM LEVERAGE RATIO • Strong balance sheet provides pathway for measured growth with potential for further diversification and optimization of the portfolio • Target long term net leverage ratio of ∼30 - 35% while maintaining patient and opportunistic approach to
Slide 18: Canadian Real Estate Debt Peer Comparison
CANADIAN REAL ESTATE DEBT PEER COMPARISON1 Total Debt-to-Capital Total Debt-to-EBITDA 80% 18.0x 16.0x 70% 14.0x 60% 12.0x 50% 10.0x 40% 8.0x 6.0x 30% 4.0x 20% 2.0x 10% 0.0x Granite has the lowest leverage within DBRS1 universe of Canadian Real Estate entities 1 Source: DBRS Canadian Real Estate Peer
Slide 19: Canadian Real Estate Debt Peer Comparison
CANADIAN REAL ESTATE DEBT PEER COMPARISON1 EBITDA Interest Coverage Distributions/Cash Flow from Operations2,3 120% 12.0x 100% 10.0x 80% 8.0x 60% 6.0x 4.0x 40% 2.0x 20% 0.0x 0% Granite has leading cash flow coverage metrics among DBRS1 universe of Canadian Real Estate entities 1 Source: DBRS Canadia
Slide 20: Leadership Team
LEADERSHIP TEAM Kevan Gorrie Teresa Neto • President and Chief Executive Officer • Chief Financial Officer • Over 20 years of real estate experience in • Over 30 years of varied business experience, Canada, the United States and Germany. including ∼10 years as a CFO for publicly- • Previously served
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