Empire State Realty Trust, Inc. · NYSE:ESRT
Empire State Realty Trust — Investor Presentation (January 2022)
29 slides from Empire State Realty Trust's investor presentation, January 2022
Slide 1: Investor Presentation
Investor Presentation January 2022
Slide 2: Contents
Overview New York City Focus Flight To Quality Contents Sustainability Leadership & Scorecard Strong & Flexible Balance Sheet ESRT Portfolio Office ESB Observatory Retail Multifamily Meet the Team: ESRT Management Appendix 2 | 29
Slide 3: Profit from the NYC Recovery
ESRT OVERVIEW Profit from the § Modernized for 21st Century NYC Recovery OFFICE § Contracted revenue growth § Sustainability, Energy Efficiency, Indoor Environmental Quality, ESB § Instant and sustained upside with NYC tourism recovery Healthy Building Leader OBSERVATORY § Inflation hedge from § Out
Slide 4: Flight To Quality At Price Points Accessible to the Broadest Range of Tenants
ESRT OVERVIEW Flight To Quality At Price Points Accessible to the Broadest Range of Tenants: “ESRT’s largely pre-war buildings are attractive to tenants for whom ‘flight to quality’ means leadership in indoor environmental quality, healthy buildings, energy efficiency and amenities.” December 21, 20
Slide 5: Flight To Quality
ESRT OVERVIEW Flight To Quality Great Fundamentals Green Power “250 West 57th Street has great infrastructure ESRT Became the Nations Largest 100% and good architecture. It’s not just an old building; User of Green Power in Real Estate it’s a pre-war trophy. Buildings of this era were built Entire P
Slide 6: Sustainability Leader
ESRT OVERVIEW Sustainability Leader § Read our Sustainability Report HERE § Board of Directors’ oversight of ESG with specific responsibility in committee charters § Alignment with Science Based Targets initiative (SBTi) 1.5-degree scenario § Empire State Building net-zero by 2030, NYC office portfo
Slide 7: Sustainability Scorecard
ESRT OVERVIEW Sustainability Scorecard ESRT’s Assets Are Our Progress vs. The Competition Centrally Located Average scores across portfolio Energy Efficiency ESRT TARGET (ENERGY STAR Certified) 75% EMPIRE STATE REALTY TRUST 76% AVG. NYC REIT 30% Walk score Air Quality and HVAC 93 ESRT TARGET (WELL H
Slide 8: Strong & Flexible Balance Sheet
ESRT OVERVIEW Strong & Debt Maturity (in $MM’s)2 Flexible Weighted Avg. Maturity: 7.4 years Balance Sheet 1200 Weighted Avg. Interest Rate: 3.9% Optionality $1,018 1000 § External growth § Share buybacks 800 $383 § Office and retail portfolio 100% owned 600 aa Metrics1 400 $315 $319 $635 § Net Debt/
Slide 9: Attractive Value Proposition
OFFICE Attractive Value New Build Class A Proposition New Construction Modernized, Energy “We have made the decision to relocate our New York Headquarters since 2008 Efficient, Indoor Office to 1400 Broadway to be in a Environmental more energy-efficient building that Quality, Healthy aligns with ou
Slide 10: Resilient and Future-Proofed
OFFICE Resilient and Future-Proofed § 9.4 million square feet across 14 buildings § Modernized for the 21st Century § Substantially lower price point versus new construction/aged Class A; superior product to Class B § Tenant-only amenities § No fines in 2024 under Local Law 97 Tenant Mix Consumer Go
Slide 11: Centrally Located Near Mass Transit
OFFICE Centrally Located Near Mass Transit One Grand Central Place Empire State Building 1359 Broadway GRAND CENTRAL TERMINAL PORT AUTHORITY TERMINAL 1350 Broadway 111 W 33rd St 1333 Broadway PENN STATION 250 W 57th St 1400 Broadway 501 7th Ave 11 | 29
Slide 12: Contracted Rents & Tenant Expansions
OFFICE & RETAIL Contracted Rents & Contracted Rents of $44: SLNC and Free-Rent Burn-Off Tenant Expansions $50 $45 $40 $42.53M $43.97M (In $Millions) $35 $20.71M $19.38M $30 Select Signed Leases Not Commenced: $25 $20.94M $20 $4.04M $15 LinkedIn at Empire State Building $10 $23.15M $23.26M $16.90M §
Slide 13: World Icon, Proven Performer
ESB OBSERVATORY World Icon, Significant Upside to NYC Tourism Recovery Proven Consistent performance amid economic cycles and new attractions Performer Observatory annual revenue1 (millions) One World Observatory Opens (1.0 Million New $165M $140.0 9/11 Museum Opens (3.1 Million Visitors Visitors es
Slide 14: Recovery & Per Capita Revenue
ESB OBSERVATORY Recovery Growth in Observatory Revenue Per Capita1 & Per Capita $50 Revenue $40 $30 New Developments § July 2020 - converted to a $20 2Q 1 5 2Q 1 6 2Q 1 9 2Q 1 7 3 Q 17 2Q 1 8 1Q 2 0 3 Q 18 2Q 2 1 timed-entry attraction model. 3 Q 15 4Q 15 3 Q 16 4Q 16 3 Q 19 4Q 19 2Q 2 0 14 4Q 17 3
Slide 15: Retail Portfolio Highlights
Expiration Square Feet % of Ann. Top 15 Tenants1 Date Occupied Base Rent 2 RETAIL 1. 1/2029 11,334 13.0% Portfolio 2. 10/2029 56,730 9.0% Highlights 3. 10/2031 34,192 8.5% 4. 11/2030 46,644 5.5% § 710K SF portfolio of irreplaceable street 5. 1/2038 44,1673 5.4% retail assets 6. 7/2022 34,670 3.5% §
Slide 16: Recent Acquisition
MULTIFAMILY Recent Acquisition § Immediately accretive to FFO § Total price: $307M ($435K per unit1) § Inclusive of $187M assumed debt § 90% interest § Initial yield on cost ~4%; mid-5% stabilized cap rate by 2025 § Favorable market trends § 95% occupancy § Demand recovery underway; migration back t
Slide 17: The Victory
PORT MULTIFAMILY AUTHORITY TERMINAL The Victory 561 10th Avenue High Quality Amenities and Attractive, PENN STATION Larger Layouts At A Glance § 41st Street and 10th Avenue Midtown West Submarket Fundamentals1 § Just North of Hudson Yards 7% and Manhattan West 6% Vacancy Rate 5% § 45 Floors, 417 Uni
Slide 18: 345 E94th Street
MULTIFAMILY 345 E94th Street High Quality Amenities and Attractive, Larger Layouts At A Glance THE FRICK Hospital § 94th Street and 1st Avenue § 2nd Avenue Subway Q Line Upper East Side Submarket Fundamentals1 § 30 Floors, 208 Units 6% § Unit Mix: Studio, 1BR, 2BR Vacancy Rate 5% 4% § 24-hour concie
Slide 19: ESRT Management
MEET THE TEAM ESRT Management Anthony E. Malkin Christina Chiu Thomas P. Durels Thomas N. Keltner, Jr. Chairman, President & Executive Vice President Executive Vice President, Executive Vice President, Chief Executive Officer & Chief Financial Officer Real Estate General Counsel 33 years with ESRT 2
Slide 20: Appendix
Overview Sustainability Achievements and Leadership Appendix Social Responsibility and Governance Environmental Goals & Progress Energy & Emissions Waste & Water Indoor Environmental Quality & ESG Certification Reconciliation of Non-GAAP Measures Disclaimer 20 | 29
Slide 21: Sustainability
OVERVIEW Sustainability Indoor Environmental Quality (IEQ) § MERV filters and increased ventilation § Active bi-polar ionization, in select spaces, neutralizes 99.92% of coronaviruses1 § Portfolio-wide low/no VOC materials § Annual air and water testing Transparency § Sustainability Reporting in ali
Slide 22: Achievements & Leadership
SUSTAINABILITY Achievements & Leadership Achievements § #1 Most Energy Efficient REIT in NYC based Industry Leadership on kgCO2 PSF, per Green Street Advisors1 & Engagement Policy Leadership at National State and City Levels ü WELL Living Lab/Mayo Clinic § Our Chairman, President and CEO, Anthony E.
Slide 23: Social Responsibility & Governance
Social Responsibility & Governance Social Responsibility Governance § Diversity, Equity and Inclusion (DE&I) § Board Diversity § Disclose diversity metrics which include gender and race/ethnicity § 22% female / 78% male (Board, leadership, overall) § 22% minority / 78% white § Inclusion Committee in
Slide 24: Energy & Emissions
ENVIRONMENTAL GOALS & PROGRESS Energy & Emissions Energy Goals Status Progress Emission Goals Status Progress Achieve net-zero 23% reduction in 50% reduction in greenhouse gas greenhouse gas emissions energy use intensity 25% reduction in energy emissions across the intensity through 20201 by 20351
Slide 25: Waste & Water
ENVIRONMENTAL GOALS & PROGRESS Waste & Water Waste & Recycling Goals Status Progress Water Conservation Goals Status Progress 30% reduction 75% waste 2018 baseline: 22% in water usage diversion 2020: 35% by 20351 rate by 20351 75% goal for waste Reduce water 30% reduction goal by Reduce waste usage
Slide 26: Indoor Environmental Quality & ESG Certification
ENVIRONMENTAL GOALS & PROGRESS Indoor Environmental Quality & ESG Certification IEQ Goals Status Progress ESG Certification Goals Status Progress Achieved GRESB 1st commercial portfolio Continue to 5 Star Rating, Green Star in the Americas to achieve report to Recognition for the Improve the IEQ GRE
Slide 27: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures Three Months Ended Year Ended Reconciliation of Net Income to NOI and September 30, June 30, March 31, December 31, September 30, December 31, Cash NOI 2021 2021 2021 2020 2020 2020 Net income (loss) $ (10,183) $ 4,411 $ (3,191) $ 710 $ (12,269) $ (22,889) Add: Ge
Slide 28: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures Three Months Ended Twelve Months to September March 31, December 31, Date 30, 2021 June 30, 2021 2021 2020 Rental revenue $ 498,263 $ 125,455 $ 125,091 $ 126,231 $ 121,486 Tenant expense reimbursement 59,373 14,103 15,706 14,000 15,564 Deduct: Straight-line rental
Slide 29: Disclaimer
This presentation includes “forward looking statements” within the meaning of the federal securities laws. Forward-looking statements may be identified by the use of words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates,” “contemplates
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