D/b/a Centerspace · NYSE:CSR
D/b/a Centerspace — Investors Real Estate Trust — Shareholder Meeting (September 2018)
20 slides from D/b/a Centerspace's shareholder meeting presentation, Sep 18, 2018
Slide 1: Annual Shareholder Meeting
Annual Shareholder Meeting September 2018 NYSE: IRET
Slide 2: Forward-looking statements
Certain statements in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from expected resu
Slide 3: www.iretapartments.com Annual Meeting | September 2018 3
www.iretapartments.com Annual Meeting | September 2018 3
Slide 4: Board of Trustees
Jeffrey P. Caira Michael T. Dance Mark O. Decker Jr. Emily Nagel Green CHAIR Linda J. Hall Terrance P. Maxwell John A. Schissel Mary J. Twinem www.iretapartments.com Annual Meeting | September 2018 4
Slide 5: Now Dedicated Multifamily Company
Now Dedicated Multifamily Company Focused Management Team Drives Operating Efficiencies Single Segment Property Specialist Engaged to Effect Improvement G&A and Operating Expenses Strong Markets and Distinct Geography Improved Capital Structure Positioned for Future Growth Combination of Core and Va
Slide 6: Delivering on stated goals and renewed business strategy
Delivering on stated goals and renewed business strategy Evolution of Business Strategy – Focus and Flexibility PAST PRESENT FUTURE Multifamily Multifamily Multifamily Focus 31% Multifamily 95% (% of NOI) 100% Leverage Leverage Leverage Leverage 41% 40% (% of Book Value) 56% Unsecured Secured Secure
Slide 7: We are a premier multifamily company delivering exposure to strong Midwest markets
We are a premier multifamily company delivering exposure to strong Midwest markets Minot MT ND Grand Forks Billings Bismarck MN St. Cloud WI Rapid City SD Minneapolis Sioux Falls Rochester IA NE Omaha Denver CO Topeka KS Highlights Portfolio Evolution • 87 communities with 13,703 apartment homes % o
Slide 8: Newer communities in the Midwest have shown strong performance since 2010
Newer communities in the Midwest have shown strong performance since 2010 Rent Growth CAGR Revenue Growth CAGR For communities built since 2010 For communities built since 2010 4.1% 3.5% 3.9% 2.8% 3.1% 2.4% 2.2% 2.3% 1.6% 1.9% Midwest South West Northeast National Avg Midwest South West Northeast Na
Slide 9: Targeted Geography Has Strong Market Fundamentals
Targeted Geography Has Strong Market Fundamentals DENVER 2010-2017 Population CAGR 1.77% Unemployment Rate 2.9% Median Household Income $71,926 Median Home Price $462,900 TWIN CITIES Multifamily % of Housing Stock(1) 26.8% 2010-2017 Population CAGR 1.01% 2014-2017 Rent CAGR 5.38% Unemployment Rate 2
Slide 10: Five markets plus Minneapolis and Denver expected to make up 78% of proforma FY19 NOI
These five markets plus Minneapolis and Denver are expected to make up 78% of proforma FY19 NOI Rochester, MN Omaha, NE Grand Forks, ND St. Cloud, MN Bismarck, ND Population 218,280 933,316 102,414 197,759 132,142 Median Household Income $70,078 $62,247 $48,671 $56,620 $65,527 Unemployment Rate(1) 2
Slide 11: Our portfolio has demonstrated more volatility
Our portfolio has demonstrated more volatility Year-Over-Year Same-Store Revenue % Change IRET Multifamily Multifamily Peers 7.0% 5.0% 3.0% 1.0% (1.0%) (3.0%) (5.0%) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2014 2015 2016 2017 2018 2019 Sources: Company Filings, SNL Notes: 1) M
Slide 12: North Dakota's cycle drove volatility
North Dakota’s cycle, Minot and Williston in particular, drove volatility Year-Over-Year Same-Store Revenue % Change Minot & Williston Bismarck & Grand Forks Others 15.0% 10.0% 5.0% 0.0% (5.0%) (10.0%) (15.0%) (20.0%) (25.0%) (30.0%) (35.0%) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q
Slide 13: We must control expense growth in the future...
We must control expense growth in the future... Year-Over-Year Same-Store Expense % Change IRET Multifamily Multifamily Peers 20.0% 16.0% 12.0% 8.0% 4.0% 0.0% (4.0%) (8.0%) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2014 2015 2016 2017 2018 2019 Sources: Company Filings, SNL Note
Slide 14: ...to drive consistent Net Operating Income growth
...to drive consistent Net Operating Income growth Year-Over-Year Same-Store Net Operating Income % Change IRET Multifamily Multifamily Peers 15.0% 10.0% 5.0% 0.0% (5.0%) (10.0%) (15.0%) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2014 2015 2016 2017 2018 2019 Sources: Company Fil
Slide 15: Westend, Dylan, Park Place, Oxbo
Westend Dylan Location: Denver, CO Location: Denver, CO Profile: Urban Core Profile: Urban Core Constructed: 2015 Constructed: 2016 Homes: 390 Homes: 274 Purchase Price: $128.7M Purchase Price: $90.6M Park Place Oxbo Location: Plymouth, MN Location: St. Paul, MN Profile: Suburban Value-Add Profile:
Slide 16: Operational Enhancements
Total Multifamily NOI Average Revenue / Home $90M $1,774 $41M $1,061 $724 FY 2012 FY 2018 FY 2012 Current Same- Current Non Same- Store(1) Store (1) Multifamily Homes Operational Enhancements • Placing full focus on our residents and our communities 13,703 • Growing our team of operational specialis
Slide 17: Total Capitalization and Debt Summary
$ in thousands, except where noted $1.5B Total Capitalization % of Weighted Weighted Debt Summary Amount Total Avg. Rate Avg. Maturity $99M $667M Total Secured Debt $466,555 70% 4.65% 5.4 Years Preferred Total Debt (1) Equity Preferred Secured Debt Unsecured LOC Balance $130,000 20% 3.83% 3.0 Years
Slide 18: Prudent capital allocation provides greater opportunities to reinvest and grow
Prudent capital allocation provides greater opportunities to reinvest in and grow our business Continue Disciplined Investment Strategy • Improve portfolio efficiency and quality through targeted redevelopment of existing assets and new acquisitions • Continue active portfolio management • Increase
Slide 19: Stronger Balance Sheet, Stronger Markets, Operational Enhancements, Governance
Stronger Balance Sheet Stronger Markets Operational Enhancements Best in Class Governance www.iretapartments.com Annual Meeting | September 2018 19
Slide 20: Investor Relations Contact
Investor Relations Contact: Jonathan Bishop ir@iret.com 701.837.7104
Investors Real Estate Trust — Shareholder Meeting (September 2018) on 6ix