Postal Realty Trust, Inc. · NYSE:PSTL
Postal Realty Trust — Q4 2023 Earnings Presentation
21 slides from Postal Realty Trust's earnings presentation, Feb 27, 2024
Slide 1: Investing in America's Logistics Network
INVESTING IN AMERICA’S LOGISTICS NETWORK February 2024
Slide 2: Only publicly traded REIT focused on USPS-leased properties
AS THE ONLY PUBLICLY TRADED REAL ESTATE INVESTMENT TRUST FOCUSED ON PROPERTIES LEASED TO THE USPS, POSTAL REALTY TRUST (NYSE: PSTL) IS AT THE INTERSECTION OF REAL ESTATE AND CRITICAL LOGISTICS INFRASTRUCTURE. PSTL HAS THE SCALE, INDUSTRY KNOWLEDGE AND SEASONED TEAM TO CONSOLIDATE THIS HIGHLY FRAGMEN
Slide 3: PSTL Investment Overview: Reasons to Invest
PSTL INVESTMENT OVERVIEW REASONS TO INVEST Singularly positioned to consolidate and institutionalize large fragmented market Critical logistics infrastructure supporting e-commerce and last-mile delivery Strong federal government-supported credit tenant with high retention rate Attractive returns ge
Slide 4: Attractive Return Profile – Based on Proven Results
LONG-TERM INVESTMENT PROPOSITION ATTRACTIVE RETURN PROFILE – BASED ON PROVEN RESULTS Margin Expansion Accretive Organic Dividend Yield & Potential; Growing Acquisitions NOI Growth Dividend Growth Liquidity o Acquired properties o 99% weighted o Attractive dividend o Cash G&A as a in 2023 at 7.7% ave
Slide 5: Diversified Real Estate Portfolio
PORTFOLIO DIVERSIFIED REAL ESTATE PORTFOLIO 14% 28% ANNUALIZED GROSS RENT1 35% 23% MIDWEST NORTHEAST SOUTH WEST 1,517 5.9MM 49 Properties Owned Interior Sq. Ft. States2 99.6% 34MM+ ~3 YEARS Occupancy Site Sq. Ft. Weighted Average Lease Term3 Note: Figures as of February 23, 2024, for PSTL’s owned po
Slide 6: Highly Fragmented Market, Ripe for Consolidation
MARKET OPPORTUNITY HIGHLY FRAGMENTED MARKET, RIPE FOR CONSOLIDATION PRIVATELY OWNED o PSTL’s portfolio represents ~6% 92MM SQUARE FEET of the leased market1 o Nearly 17,000 different lessors of properties leased to the USPS OWNED BY PSTL 5.9MM SQUARE FEET o Next top 20 largest portfolio owners combi
Slide 7: Opportunity to Gain Considerable Market Share
MARKET OPPORTUNITY OPPORTUNITY TO GAIN CONSIDERABLE MARKET SHARE Long-standing relationships within the industry Reputation—active buyers for 30 years, well-known as the largest owner and a trusted resource1 Experienced in-house acquisitions team generating off-market transactions LAST-MILE2 FLEX3 I
Slide 8: USPS's Irreplaceable Logistics Network
LOGISTICS NETWORK USPS’S IRREPLACEABLE LOGISTICS NETWORK CRITICAL INFRASTRUCTURE SUPPORTS E-COMMERCE AND LAST-MILE DELIVERY o Amazon, UPS, FedEx, and DHL all tap into the USPS’s logistics AS E-COMMERCE HAS network every day GROWN, THE USPS’ o USPS’s unmatched logistics network has high barriers to e
Slide 9: Favorable Lease Structure
GOVERNMENT-SUPPORTED CREDIT TENANT FAVORABLE LEASE STRUCTURE LEASE STRUCTURE: INFLATION PROTECTIONS: ✓ Most commonly five years in duration ✓ Lease duration allows the continual opportunity for renewals at market rents ✓ Various forms of modified double net leases (typical USPS responsibilities incl
Slide 10: Stable Credit Tenant with Consistently High Retention
GOVERNMENT-SUPPORTED CREDIT TENANT STABLE CREDIT TENANT WITH CONSISTENTLY HIGH RETENTION 99% 100% 100% 100% 100% 100% 99% 99% 99% 98% 98% Historical Weighted Average Lease Retention Rate1 96% Federal government-supported credit USPS operating lease payments represented only 1.5% of the USPS’s total
Slide 11: Lease Expirations Provide Opportunity to Drive NOI Growth
ATTRACTIVE RETURN PROFILE LEASE EXPIRATIONS PROVIDE OPPORTUNITY TO DRIVE NOI GROWTH YEAR NUMBER OF LEASES SQUARE FEET ANNUAL RENT1 % OF TOTAL RENT1 2024 194(2) 1,080,013 $8,646,299 15.6% 2025 214 608,414 $7,100,051 12.8% 2026 305 1,106,476 $10,875,657 19.7% 2027 431 1,372,088 $14,106,510 25.5% 2028
Slide 12: Meaningful Growth Since IPO
ATTRACTIVE RETURN PROFILE MEANINGFUL GROWTH SINCE IPO Annual Acquisitions ($ in millions)(1) Cumulative Acquisitions ($ in millions)(1) $130 $123 $537 $118 $459 $47 $30 $78 $336 $88 $218 $65 $67 $56 $88 $35 $18 $21 $22 FY'20 FY'21 FY'22 FY'23 2019 Post IPO FY'20 FY'21 FY'22 FY'23 Last-Mile Flex Indu
Slide 13: Well Capitalized Balance Sheet
CONSERVATIVE BALANCE SHEET WELL CAPITALIZED BALANCE SHEET $8.0MM DEBT MATURITY SCHEDULE $125.0MM $200.0MM TOTAL $75.0MM CAPITALIZATION $636.4MM $395.4MM No Notable Near-term $33.0MM Debt Maturities $32.8MM $8.0MM $0.2MM 2024 2025 2026 2027 2028 Thereafter Unsecured Term Loans Other Debt Market Value
Slide 14: Decades of Experience and Institutional Knowledge
LEADERSHIP DECADES OF EXPERIENCE AND INSTITUTIONAL KNOWLEDGE Andrew Spodek Chief Executive Officer o Founder and CEO o More than 20 years of experience focused on investing in and managing USPS properties o Serves on the board of directors of the Association of United States Postal Lessors Jeremy Ga
Slide 15: Committed to Corporate Responsibility and Sustainable Business Practices
ENVIRONMENTAL, SOCIAL & GOVERNANCE (ESG) COMMITTED TO CORPORATE RESPONSIBILITY AND SUSTAINABLE BUSINESS PRACTICES ENVIRONMENTAL SOCIAL GOVERNANCE o Multi-disciplinary ESG committee, o Focused on ensuring PSTL employee o Independent Board of Directors led including several senior executives, welfare,
Slide 16: Appendix
APPENDIX 17
Slide 17: Portfolio by Asset Class
APPENDIX PORTFOLIO BY ASSET CLASS LAST-MILE1 PROPERTIES UNDER 2,500 INTERIOR SQUARE FEET Property Count Interior Sq. Ft. Annualized Base Rent Annualized Base Rent PSF 963 1.3MM $14.2MM $10.82 FLEX2 PROPERTIES 2,500 - 50,000 INTERIOR SQUARE FEET Property Count Interior Sq. Ft. Annualized Base Rent An
Slide 18: Last-Mile
APPENDIX LAST-MILE WEST JEFFERSON, OH WHITEHOUSE, OH o Acquired as part of a 14-property portfolio from o Located just five miles from Toledo Express a long-term portfolio owner Airport, Whitehouse is growing quickly with over five subdivisions currently underway o ~2,300 sq. ft. well-utilized facil
Slide 19: Flex
APPENDIX FLEX HOMESTEAD, FL MURPHYS, CA o Located on the southern tip of Miami-Dade o Murphys, CA is a former gold mining settlement, and County in a highly trafficked retail pocket today is known for its local vineyards, wine tasting o ~11,000 sq. ft. post office that plays a pivotal rooms, and res
Slide 20: Industrial
APPENDIX INDUSTRIAL WARRENDALE, PA MILWAUKEE, WI o Over 300,000 sq. ft. processing & distribution o ~575,000 sq. ft. USPS logistics hub with center strategic location in Downtown Milwaukee o Modern logistic facility approximately 14 miles along mixed-use corridor from the Pittsburgh International Ai
Slide 21: Disclaimer and Definitions
APPENDIX DISCLAIMER AND DEFINITIONS This presentation regarding the Company contains “forward-looking statements.” Forward-looking statements include statements identified by words such as “could,” “may,” “might,” “will,” “likely,” “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,”