Stag Industrial, Inc. · NYSE:STAG
Stag Industrial — Investor Presentation (June 2021)
29 slides from Stag Industrial's investor presentation, June 2021
Slide 1: 2021 – Spring
2021 – SPRING
Slide 2: Forward-Looking Statements & Definitions
FORWARD-LOOKING STATEMENTS & DEFINITIONS Forward-Looking Statements This supplemental information package contains certain 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. STAG
Slide 3: Thoughtful Approach to Industrial Real Estate
THOUGHTFUL APPROACH TO INDUSTRIAL REAL ESTATE STAG Industrial is an owner and operator of industrial real estate Platform able to address a large opportunity in an attractive Only pure-play industrial asset class REIT active across the Relative value investment strategy driven by a robust entire dom
Slide 4: Significant Transformation Since IPO
SIGNIFICANT TRANSFORMATION SINCE IPO Portfolio strengthened and diversified Investment grade balance sheet achieved PORTFOLIO TRANSFORMATION IPO 1 Q1 2021 Square feet (millions) 14.2 99.1 Properties 93 494 Number of States 26 39 Flex / Office (% ABR) 21.1% 0.6% BALANCE SHEET STRENGTHENED IPO Q1 2021
Slide 5: Building Blocks of Growth
BUILDING BLOCKS OF GROWTH NORMALIZED EXPECTATIONS OVER HISTORICAL TREND 2021 GUIDANCE NOTES NEXT FIVE YEARS Average cash same store NOI Cash same store NOI growth of 2.0% - 3.0% Cash same store NOI growth of 2.0% - Highest level of initial guidance growth of ~1.0% over past six • Retention range of
Slide 6: Operational Expertise Focused on Maximizing Cash Flow
OPERATIONAL EXPERTISE FOCUSED ON MAXIMIZING CASH FLOW Regional asset management supported by local brokers on all new and renewal leasing transactions Customer Solutions Group with corporate and portfolio wide context to execute on opportunities within portfolio Capital Projects Group oversees all p
Slide 7: Multi-Faceted Approach to Creating Value
MULTI-FACETED APPROACH TO CREATING VALUE CASE STUDIES: VALUE ADDED THROUGH OPERATIONS Multi-Site Value Creation – Northern IN Uncertain Tenancy – Garland, TX Long Term Extension – Memphis, TN Acquired the building in October 2020 Acquired the building in April 2014 at 100% occupancy Acquired in Sept
Slide 8: Value Creation Through Development
VALUE CREATION THROUGH DEVELOPMENT Property Location Opportunity 8 Campus Drive Burlington, NJ Acquired 500,000 SF building with RETURN PROFILE Exit 6A of NJ Turnpike 25 acres of excess land in 2015 Development Plan 110% + Profit Margin Subdivided the excess 25 acres for the development project Full
Slide 9: Demonstration of Portfolio Premium
DEMONSTRATION OF PORTFOLIO PREMIUM PORTFOLIO 2016 2018 2016 PORTFOLIO 2018 PORTFOLIO DISPOSITIONS PORTFOLIO PORTFOLIO CHARACTERISTICS Number of buildings 6 7 Square feet 1.6 million 1.8 million Average building size 261,593 SF 250,494 SF WA lease term 4.2 years 6.5 years RETURN PROFILE Acquisition c
Slide 10: Industrial Real Estate Offers Attractive Opportunity
INDUSTRIAL REAL ESTATE OFFERS ATTRACTIVE OPPORTUNITY Large and highly Stable cash flow due to E-commerce and supply fragmented asset class GDP growth and high tenant retention and chain reconfiguration The 20 largest owners of U.S. industrial personal consumption drive low capital expenditure provid
Slide 11: Large Target Market
BROAD BASED OPPORTUNITY SET LARGE TARGET MARKET U.S. industrial market is more than $1 trillion in total size1 $1 Trillion Total Industrial Market1 0.5% STAG’s opportunity set spans the top 60+ markets in the U.S. Relative value investment strategy across all fungible industrial markets enhances val
Slide 12: Process Driven Approach to Address Attractive Opportunity
PROCESS DRIVEN APPROACH TO ADDRESS ATTRACTIVE OPPORTUNITY Value created via granular approach to acquisitions across a broad opportunity set – relative value investment strategy employed with portfolio premium value created upon acquisition Perceived risk of single-tenant assets frequently creates r
Slide 13: Emphasis on Diversification
EMPHASIS ON DIVERSIFICATION PORTFOLIO WIDELY DIVERSIFIED ACROSS ATTENTION TO DIVERSIFICATION GEOGRAPHY, TENANT, INDUSTRY, LEASE REDUCES RISK AND ENHANCES VALUE TERM Portfolio spans Largest market exposure is Portfolio includes 60+ markets less than 8% of ABR exposure to 45+ industries Largest tenant
Slide 14: Sophisticated and Diverse Tenant Base
SOPHISTICATED AND DIVERSE TENANT BASE In-depth tenant credit analysis and ongoing credit monitoring TENANT REVENUE EXPOSURE BY ABR 35.0% 30.6% 30.0% Dedicated credit analysis team of five professionals (three CFA charter holders) 25.0% 22.3% 20.0% Focus on single-tenant industrial real estate result
Slide 15: Balance Sheet Discipline
BALANCE SHEET DISCIPLINE CONSERVATIVE BALANCE SHEET POSITIONED TO SUPPORT GROWTH Conservative Capitalization Fixed Rate (in $ millions) Borrower - $57 $0 Secured Preferred 12.7% Debt Equity Floating (revolving credit facility only) 0.8% 0.0% $1,783 $5,468 Unsecured Common Equity at 87.3% Debt Market
Slide 16: Compelling Valuation
COMPELLING VALUATION Growing Income FFO MULTIPLE1 Internal growth with long history of success managing portfolio External growth with large opportunity set and robust investment pipeline Established built-to-suit takeout partner to developers nationwide 18.4x STAG Value Creation Attractive asset cl
Slide 17: ESG - Environmental
ESG - ENVIRONMENTAL GREEN LEASE LEADERS AWARD RECIPIENT SOLAR PANEL INSTALLATION Recognizes forward-thinking companies that utilize energy Leverage rooftop square footage to create clean energy efficient and sustainable leases Gold level awarded in 2020 Eight installations totaling 12 MW completed S
Slide 18: ESG - Social and Governance
ESG - SOCIAL AND GOVERNANCE Our Charitable Action Committee proudly supports a SOCIAL diverse group of nonprofit organizations RESPONSIBILITY Focus on efforts supporting children, young adults, equality, and social justice Support provided through donations and significant volunteering Oversee a Cha
Slide 19: Appendix
APPENDIX STAG Industrial, Inc. 19
Slide 20: Chicago
CHICAGO MARKET #1 7.2% ABR CHICAGO SUPPLY AND DEMAND CHICAGO AVAILABILITY AND RENT GROWTH 30,000,000 13.0% $7.00 25,000,000 12.0% $6.50 11.0% $6.00 20,000,000 10.0% $5.50 15,000,000 9.0% $5.00 10,000,000 8.0% $4.50 7.0% $4.00 5,000,000 6.0% $3.50 - 5.0% $3.00 2013 2014 2015 2016 2017 2018 2019 2020
Slide 21: Chicago
CHICAGO MARKET #1 7.2% ABR RECENT TENANT ACTIVITY CHICAGO IS THE NATION’S PREMIER FREIGHT HUB STAG Industrial, Inc. 21
Slide 22: Philadelphia
PHILADELPHIA MARKET #2 6.4% ABR PHILADELPHIA SUPPLY AND DEMAND PHILADELPHIA AVAILABILITY AND RENT GROWTH 30,000,000 14.0% $7.00 25,000,000 12.0% $6.00 10.0% $5.00 20,000,000 8.0% $4.00 15,000,000 6.0% $3.00 10,000,000 4.0% $2.00 5,000,000 2.0% $1.00 - 0.0% $0.00 2013 2014 2015 2016 2017 2018 2019 20
Slide 23: Strategic Location
PHILADELPHIA MARKET #2 6.4% ABR Region encompasses Philadelphia Metro and STRATEGIC Central PA/Lehigh Valley LOCATION Central to East Coast population centers and truck routes servicing them 1 Tenant Activity in Recent Years 1. Map outline based on Costar Research market boundaries STAG Industrial,
Slide 24: Greenville/Spartanburg
GREENVILLE/SPARTANBURG MARKET #3 5.2% ABR GREENVILLE SUPPLY AND DEMAND GREENVILLE AVAILABILITY AND RENT GROWTH 10,000,000 12.0% $4.25 $4.00 8,000,000 10.0% $3.75 6,000,000 $3.50 $3.25 4,000,000 8.0% $3.00 2,000,000 $2.75 6.0% $2.50 - 2013 2014 2015 2016 2017 2018 2019 2020 2013 2014 2015 2016 2017 2
Slide 25: Greenville/Spartanburg
GREENVILLE/SPARTANBURG MARKET #3 5.2% ABR BMW has invested $10 billion in its Spartanburg plant since 1994. Products include all new X6 announced in July 2019 Inland port at Greer has significantly outperformed expectations with record volume in May 2019 of more than 204 thousand TEUs handled Strate
Slide 26: Non-GAAP Financial Measures & Other Definitions
NON-GAAP FINANCIAL MEASURES & OTHER DEFINITIONS Acquisition Capital Expenditures: We define Acquisition Capital Expenditures as Recurring and Non-Recurring Capital Expenditures identified at the time of acquisition. Acquisition Capital Expenditures also include new lease commissions and tenant impro
Slide 27: Non-GAAP Financial Measures & Other Definitions
NON-GAAP FINANCIAL MEASURES & OTHER DEFINITIONS Earnings before Interest, Taxes, Depreciation, and Amortization for Real Estate (EBITDAre), Adjusted EBITDAre, Annualized Adjusted EBITDAre, and Run Rate Adjusted EBITDAre: We define EBITDAre in accordance with the standards established by the National
Slide 28: Non-GAAP Financial Measures & Other Definitions
NON-GAAP FINANCIAL MEASURES & OTHER DEFINITIONS GAAP: We define GAAP as generally accepted accounting principles in the United States. Liquidity: We define Liquidity as the amount of aggregate undrawn nominal commitments the Company could immediately borrow under the Company’s unsecured debt instrum
Slide 29: Non-GAAP Financial Measures & Other Definitions
NON-GAAP FINANCIAL MEASURES & OTHER DEFINITIONS Recurring Capital Expenditures: We define Recurring Capital Expenditures as capital items required to sustain existing systems and capital items which generally have a shorter useful life. Recurring Capital Expenditures funded by parties other than the