Starwood Property Trust Inc. · NYSE:STWD
Starwood Property Trust — NAREIT REITWeek 2010
17 slides from Starwood Property Trust's conference presentation, Jun 9, 2010
Slide 1: Starwood Property Trust, Inc. NAREIT REITWeek 2010
Starwood Property Trust, Inc. NAREIT REITWeek 2010 June 10, 2010
Slide 2: Forward-Looking Statements
1 Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are based on the Company’s current expectations and beliefs, as well as a number of assumptions concerning future events. These state
Slide 3: Overview
Overview Starwood Property Trust, Inc. (“STWD”) is a real estate investment trust that is focused primarily on originating, financing, and acquiring commercial mortgage whole loans, bridge loans, B-notes, mezzanine loans, CMBS, and on making other commercial real estate-related debt investments Form
Slide 4: Investment Thesis
Investment Thesis 3 Building Leading “Gen 4” CRE Finance Company Historic and Long-Term Business Opportunity No Legacy Assets Large Capital Raise Which Generates Economies of Scale Looming Refinancing Crisis & Rising Transaction Volume Premier Sponsorship, Strong Track Record & Disciplined Underwrit
Slide 5: Origination, Underwriting, In-House Servicing and Financing
4 Origination / Sourcing Underwriting In-House Servicing / Asset Management Continue to build out team of originators and pursue origination joint ventures Established relationships with multiple borrowers, the government / FDIC, financial institutions, and local / national real estate investors Dee
Slide 6: Premier Sponsorship With Relevant Experience; Building Dedicated Management Team
5 Starwood Capital Group (“SCG”) is a global private real estate investment firm with $16 billion in AUM which has acquired ~$21 billion of assets and invested ~$7.5 billion of equity since inception in 1991 Developed a fully integrated mezzanine origination platform in the mid 90’s (Starwood Financ
Slide 7: Proven Investment Discipline
All investment and disposition data is representative of the equity investments made or disposed of during the given time period. While others talk about discipline, Starwood significantly withdrew from the equity market when returns moved to entirely backloaded, residual-only investments and curren
Slide 8: Looming Refinancing Crisis in Commercial Real Estate Market
Looming Refinancing Crisis in Commercial Real Estate Market CRE debt maturities Source: Deutsche Bank, Intex, Mortgage Bankers Association and Federal Reserve CMBS loans on watch list by vintage Source: Cushman & Wakefield and Bloomberg Loan Balance % of Year’s Issuance on Watch List ($ in billions)
Slide 9: CRE Transaction Volume and Prices
Deteriorating fundamentals and reduced access to capital have resulted in dramatic declines in transactional activity and real estate prices Source: J.P. Morgan, Real Capital Analytics, Bloomberg. 2009 data is through October 31, 2009 (latest available). Moody’s CPPI index is represented by the Mood
Slide 10: Senior Mortgage Financing is Beginning to Return
Senior Mortgage Financing is Beginning to Return 9 Improved CMBS Market and More Affordable A-Notes Cheaper / Larger Debt Envelope & Increased Demand for Junior Debt New Lending Opportunities for STWD at Desirable Yields Tightened Spreads DDR, Flagler, and Inland Western REIT Securitizations RBS Mul
Slide 11: Current Investment Pursuits
Current Investment Pursuits 10 STWD Is Built To Evolve with the Market B-Note & Mezzanine Note Origination / Acquisition Renovation / Repositioning Loans Whole Loan Origination / Acquisition International Loans CMBS FDIC / Government Banks / Financial Institutions Local Broker, Borrower, Developer R
Slide 12: Investment Philosophy
Investment Philosophy Safety and income Disciplined focus on capital preservation Patient deployment of capital for the appropriate risk-adjusted reward Practical, high quality interaction with borrowers to structure appropriate loans Diversified portfolio by both geography and property type Adaptiv
Slide 13: Portfolio Summary as of May 31, 2010
Portfolio Summary as of May 31, 2010 12 Investment Book Value (‘000) % of Total Weighted Avg. Life First Mortgage Loans $ 675,760 58% 3.1 Years Multi-Asset CMBS $ 202,682 18% 1.7 Years Subordinate Loans $ 186,897 16% 2.8 Years Single Borrower CMBS $ 46,312 4% 5.0 Years RMBS $ 39,263 3% 0.9 Years Oth
Slide 14: Building a Diversified Portfolio
Building a Diversified Portfolio 13 (1) Based upon Net Investment including Minority Interests Investment Type(1) Property Type(2) Geography(3) All figures as of May 31, 2010. (2) Based upon Book Value (3) Based upon Book Value
Slide 15: TIAA Portfolio Overview
TIAA Portfolio 14 Overview: Acquired a $502.9mm loan portfolio from TIAA on 2/26/10. Conservative, low leverage seasoned fixed rate loans. The portfolio is secured by retail and office assets totaling 4.5mm SF across 10 states. Favorable Financing: Closed $280mm of matched-term financing at L + 300
Slide 16: Originated Loan Summary
Originated Loan Summary 15 Transaction Highlights Loan Balance(1) LTV(2) Power Center Orland Park, IL First Mortgage “Cash-In” refinancing of a well positioned retail center in Orland Park, IL. Strong institutional sponsorship. $16.0 MM 44% Boutique Hotel Laguna Beach, CA First Mortgage Beachfront l
Slide 17: Poised to Put Additional Capital to Work
16 Poised to Put Additional Capital to Work $219 Million(1) Available Cash $115 Million 2010 Projected Loan Repayments + (1) As of May 31, 2010. $334 Million Investment Capacity + Leveraging Existing Assets & Planned Incremental Financing Facility