Sila Realty Trust, Inc. · NYSE:SILA
Sila Realty Trust — BofA Securities 2024 Global Real Estate Conference
40 slides from Sila Realty Trust's conference presentation, Sep 9, 2024
Slide 1: BofA Securities 2024 Global Real Estate Conference
BofA Securities 2024 Global Real Estate Conference Skillful and Thoughtful Investing
Slide 2: Disclosures
Disclosures Forward Looking Statements Certain statements contained herein, other than historical fact, may be considered “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, and
Slide 3: Sila Realty Trust net lease healthcare REIT
Sila Realty Trust is a net lease REIT specializing in institutional quality healthcare properties with a ‘Shareholder First’ mentality. We are an investor in real estate properties across the healthcare continuum of services. Applying a core sector asset approach, we believe Sila offers investors th
Slide 4: Introductions
Introductions 4 Michael A. Seton President and Chief Executive Officer Founder and Board Member Kay C. Neely Executive Vice President and Chief Financial Officer Christopher K. Flouhouse Executive Vice President and Chief Investment Officer Miles F. Callahan Senior Vice President Capital Markets and
Slide 5: Sila Realty Trust At a Glance
Portfolio Highlights Financial Highlights 26.4% Net Debt Leverage Ratio(2) 3.1x Net Debt to EBITDAre Ratio(3) $587M Liquidity(4) Sila Realty Trust At a Glance Sila Realty Trust, Inc. is a net lease REIT with a strategic focus on investing in the significant, growing, and resilient healthcare sector
Slide 6: Pure-Play in High Quality Healthcare Assets
Pure-Play in High Quality Healthcare Assets NYSE Listing Day | June 13, 2024
Slide 7: Net Lease REIT Focused on High-Quality Healthcare Assets
Healthcare trends are shifting patients to cost-effective, easy-to-access, healthcare settings, driving demand for strategic asset classes along the healthcare continuum. H ig h e s t A c u it y (H ig h e s t C o s t S e tt in g s ) L o w e s t A c u ity (L o w e s t C o s t S e ttin g s ) Acute Car
Slide 8: Large Growing Market in a Defensible Sector
Large Growing Market in a Defensible Sector1 Capitalizing on favorable macro tailwinds driving demand for healthcare settings that are cost efficient while delivering personalized quality of care. (1) U.S. Census Bureau (2) Peterson-KFF analysis of 2021 Medical Expenditure Panel Survey (3) Center fo
Slide 9: Proven Track Record of Value Creation
Proven Track Record of Value Creation Fort Smith Healthcare Facility, Arkansas
Slide 10: Investment criteria and in-house management
• On-campus or off-campus facilities in retail-type locations • Strong visibility and access with ample parking • High growth areas near population clusters that are convenient to patients/customers • Near and convenient to the tenant’s patient referral sources • Large patient catchment areas • Clas
Slide 11: Acquisitions and dispositions history
Acquired 11 Properties for $105M 2018 Acquired 67 Properties for $1,302M(3) 2019 Acquired 3 Properties for $16M 2020 Acquired 4 Properties for $71M 2021 Acquired 7 Properties for $157M 2022 Acquired 2 Properties for $70M 2023 Acquired 8 Properties for $164M(5) YTD 2024 Sold 1 Property for $3M Sold 2
Slide 12: Broad Acquisition Sourcing Network Affords Opportunity to be Highly Selective
Broad Acquisition Sourcing Network Affords Opportunity to be Highly Selective 86.6% Pass - Do Not Fit Investment Strategy 13.4% Presented to Management 3.2% LOI Sent to Seller 1.4% LOI Accepted 1.2% Closed Medical Outpatient Buildings Inpatient Rehabilitation Facilities Other Healthcare Facilities I
Slide 13: Market, location and tenant credit analysis
• Rent growth, supply/demand, absorption, construction, vacancy, etc. • Markets that have recession resistant attributes such as universities and government presence • Major employers in the market Market Analysis • Target markets with population growth at or above national average • Demographics st
Slide 14: Annual Lease Escalation Structure
Annual Lease Escalation Structure 12.4% 87.6% 16.4% 83.6% CPI Contractual ABR(1) Leases(2) • Experienced management team has a proven record of negotiating and closing on meaningful acquisitions and strategic dispositions • Supportive year-over-year internal growth through 2.2% weighted average annu
Slide 15: Robust Portfolio Delivers Strong Operating Metrics
Robust Portfolio Delivers Strong Operating Metrics NYSE Listing Day | June 13, 2024
Slide 16: Geographic Diversification
We seek to acquire and own healthcare real estate diversified across the country, with a focus on “Smile State” markets with strong demographic, economic, and social drivers. (1) Represents each state’s annualized June 2024 contractual base rent as a percentage of total annualized June 2024 contract
Slide 17: Sponsor Strength and Recognition
Market leading healthcare providers across the country put their trust in our facilities to provide the highest quality healthcare settings. Sponsor Strength and Recognition3 17 Logos represent top 10 tenant diversification
Slide 18: Property Type and Tenant/Sponsor Diversification
Property Type Diversification(1) (ABR(2), Properties) 37.4% 91 28.6%, 19 34.0%, 27 Medical Outpatient Building Inpatient Rehabilitation Facility Surgical and Specialty Facilities Tenant/Sponsor Diversification(2)(4) 36.4% 28.1% 35.5% Investment Grade Rated Tenant/Guarantor or Affiliate Rated Tenant/
Slide 19: Tenant Lease Expiration Schedule
Tenant Lease Expiration Schedule(2)(3) 0.0M 0.5M 1.0M 1.5M 2.0M $0M $20M $40M $60M S q u a re F e e t A B R (4 ) ABR Expiring Leased Sq Ft (1) Master leases account for a single lease. (2) The table includes tenants who have been moved to the cash basis of accounting for revenue recognition purposes
Slide 20: Sila Demonstrates Strong Metrics Relative to Peers
8.2 Yrs 11.9 Yrs 5.9 Yrs SILA Net Lease Peer Average Healthcare Peer Average Long Lease Term 97.5% 99.6% 92.7% SILA Net Lease Peer Average Healthcare Peer Average Portfolio Leased 3.1x 5.1x 5.9x SILA Net Lease Peer Average Healthcare Peer Average Low Leverage (Net Debt / EBITDAre) 99.9% 99.1% 79.5%
Slide 21: Fortified Balance Sheet to Fund Future Growth
Fortified Balance Sheet to Fund Future Growth Reading Healthcare Facility, Pennsylvania
Slide 22: Balance Sheet Highlights and Debt Maturity Schedule
Sila’s management team has built a balance sheet that we believe positions the Company for growth and provides insulation from adverse and unpredictable market dislocations. Debt Maturity Schedule(3) $275 M $250 M 2024 2025 2026 2027 2028 2029 T e rm L o a n U n d ra w n $ 5 0 0 M R e v o lv e r Bal
Slide 23: 2024 acquisitions
Sila has an opportunistic ability to continue optimizing our portfolio composition on top of already possessing a curated and sizable assortment of high- quality and diversified healthcare net lease assets as demonstrated by our 2024 acquisitions. Fort Smith Healthcare Facility Fort Smith, Arkansas
Slide 24: Experienced Leadership Team
Experienced Leadership Team NYSE Listing Day | June 13, 2024
Slide 25: Company history and Putting Shareholders First
Founding of Sila Realty Trust, Inc. 2014 Founding of predecessor company. 2010 Sale of predecessor company’s data center portfolio 2018 Merger with predecessor company, creating size and scale of healthcare portfolio 2019 Internalization of management and rebranding to Sila Realty Trust, Inc. 2020 S
Slide 26: Experienced Management Team
Cycle-tested management team with proven operating experience and extensive knowledge of the existing portfolio and tenant partners. Experienced Management Team5 26 Michael A. Seton President and Chief Executive Officer • 30+ years of experience in real estate investment and finance, completing bill
Slide 27: Board of Directors
Our Board of Directors brings industry insights, strong business expertise and diverse perspectives to Sila. * Denotes Independent Director Jonathan Kuchin, Chairman of the Board* Member of Audit Committee • Formerly Tax Partner at PWC - Focused on public and private REITS, SEC reporting for public
Slide 28: Commitment to Corporate Governance
✓ Experienced Board of Directors, Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee ✓ Majority independent Board of Directors (83%), who bring a diverse array of backgrounds, experience, and perspectives ✓ 10+ years as an SEC registrant (since inception) Boar
Slide 29: Commitment to Corporate Responsibility
Commitment to Corporate Responsibility Tree Planting Volunteer Event | April 24, 2024
Slide 30: Corporate responsibility initiatives
Sila believes in maintaining a healthy, prosperous, and sustainable work environment through stewardship of the environment, the community, the employees, and strong corporate governance practices. • Sila seeks to own healthcare properties that are important to the communities they serve • Sila prom
Slide 31: Appendix
Appendix Tampa Healthcare Facility II, Florida
Slide 32: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Adjusted Fair Value of Real Estate Investments Adjusted fair value of real estate investments is calculated using the real estate values determined as of the most recent NAV (as defined below), adjusted for property acquisitions and dispositions, major capit
Slide 33: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Earnings Before Interest, Taxes, Depreciation, Amortization, Rent and Management Fees (EBITDARM) The Company utilizes EBITDARM, a supplemental non-GAAP performance measure, to evaluate the core operations of our tenants and/or guarantors (together, the “Obli
Slide 34: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms Funds from Operations (FFO), Core FFO, and Adjusted FFO (AFFO) FFO, a non-GAAP financial measure, is calculated consistent with NAREIT’s definition, as net income (loss) (calculated in accordance with GAAP), excluding gains (or losses) from sales of real est
Slide 35: FFO, Core FFO and AFFO reconciliation
Non-GAAP Measures and Definition of Terms Funds from Operations (FFO), Core FFO, and Adjusted FFO (AFFO) (Cont’d) December 31, December 31, March 31, June 30, 2022 2023 2024 2024 Net income (loss) attributable to common stockholders (7,978)$ 24,042$ 14,980$ 4,628$ Adjustments: Depreciation and amort
Slide 36: Liquidity, Net Debt and NAV definitions
Liquidity A financial metric that represents the outstanding cash and cash equivalents combined with the remaining borrowing base availability on the Company’s credit facility at a point in time. Net Debt Net debt, a non-GAAP financial measure, represents principal debt outstanding less cash and cas
Slide 37: Net Operating Income, Cash NOI and Same Store Cash NOI
Net Operating Income (NOI), Cash NOI and Same Store Cash NOI NOI, a non-GAAP financial measure, is defined as rental revenue, less rental expenses, on an accrual basis. Cash NOI is calculated to exclude the impact of GAAP adjustments to rental revenue and rental expenses, consisting of straight-line
Slide 38: NOI reconciliation table
December 31, December 31, March 31, June 30, 2022 2023 2024 2024 Rental revenue 179,986$ 189,065$ 50,639$ 43,554$ Rental expenses (17,950) (20,196) (5,554) (5,849) Net operating income 162,036 168,869 45,085 37,705 Adjustments: Straight-line rent adjustments, net of write-offs (7,261) (2,197) (1,176
Slide 39: Non-GAAP Measures and Definition of Terms
Non-GAAP Measures and Definition of Terms 39 Remaining Lease Term The number of periods remaining in each tenant’s lease, calculated on a weighted average basis using annualized base rent. Rent Escalation The amount of base rent increases that are included within each tenant’s lease, calculated on a
Slide 40: Contact Information
Contact Information Corporate Address www.SilaRealtyTrust.com 1001 Water Street Suite 800 Tampa, FL 33602 Miles Callahan Senior Vice President, Capital Markets & Investor Relations IR@silarealtytrust.com
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