Apartment Investment And Management Company · NYSE:AIV
Apartment Investment And Management — Investor Presentation (August 2011)
21 slides from Apartment Investment And Management's investor presentation, Aug 9, 2011
Slide 1: Investor Presentation August 2011
Investor Presentation August 2011
Slide 2: Forward-Looking Statements and Other Information
Forward-Looking Statements and Other Information This presentation contains forward-looking statements within the meaning of the federal securities laws, including statements regarding projected results and specifically forecasts of 2011 financial results. These forward-looking statements are based
Slide 3: Aimco Has a Simple Business Strategy
Aimco Has a Simple Business Strategy Own and operate a broadly diversified portfolio of B/B+ quality apartment homes; Concentrate capital in the 20 largest markets in the United States; Continuously upgrade our portfolio by selling assets with lower projected returns and reinvesting those proceeds i
Slide 4: Aimco Overview
Initial Public Offering completed in 1994 with $315 million capitalization. Aimco doubled in size every 18 months from 1994 - 2002 through several corporate mergers and large portfolio acquisitions. Since 2002, Aimco has continued to improve the quality and geographic focus of its portfolio through
Slide 5: Aimco Portfolio: Conventional Portfolio
Market-rate rents B/B+ asset quality Concentrated in 20 markets Significant redevelopment opportunities Aimco Portfolio Conventional Portfolio Conventional Portfolio Manhattan Boston Philadelphia Suburban NY / NJ Washington- NoVa-MD Orange County Los Angeles Denver Phoenix Chicago Dallas / Ft Worth
Slide 6: Asset Quality in Aimco's Markets
Asset Quality in Aimco's Markets Aimco defines quality by comparing rents to local market averages A-quality: rents greater than 125% of market average B-quality: rents 90% - 125% of market average C-quality: rents less than 90% of the market average Rent versus local market average represents Aimco
Slide 7: Disciplined Portfolio Management
Disciplined Portfolio Management Conventional portfolio transformation Conventional portfolio transformation Excludes casualties and property management expenses. NOI less assumed capital replacement expenditures of $850 per unit. $8.6 billion of sales of lower-rated assets from 2004 through June 20
Slide 8: Aimco Portfolio: Affordable Portfolio
Rents generally paid, in whole or in part, by a government agency. Rates adjust annually, brought to market approximately every five years. Higher occupancy and lower turnover than Conventional Portfolio. Financing costs compare favorably to Conventional Portfolio. Aimco Portfolio Affordable Portfol
Slide 9: Investment Strategy
Investment Strategy Method of Funding New Investments Critical to Decision-Making Investment Options Sell Real Estate/Issue Equity Increase Ownership in Existing Assets: portfolio average FCF IRR (G&A savings accretive to FFO) Reduce Leverage: 6% to 8% levered IRR Acquire Real Estate: Generally 7% t
Slide 10: Operating Platform: Property Operations Focus
Customer Service: Provide our residents with consistent service in clean, safe and attractive communities. Resident Selection & Retention: Attract and retain credit-worthy residents who are good neighbors. Revenue Management: Centralized revenue management system leverages people, processes and tech
Slide 11: Reliable Operating Results
* Average of AvalonBay, Camden, Equity Residential, Essex, Home Properties and UDR results as reported individually by SNL Financial. Reliable Operating Results Operating performance exceeds peer average year-to-date and over the last one, three and five years. Apartment markets are recovering and m
Slide 12: Accelerating Rental Rate Growth
Accelerating Rental Rate Growth Aimco's focus is NOI growth, which takes into consideration the balance between rate, occupancy levels and turnover costs. Turnover remains at approximately 33%.
Slide 13: Apartment Demand is Strong
60% to 70% of people aged 20 to 34 opt for rental housing.* This age cohort is projected to increase by 2.5 million people in the next three years, and 3.5 million over the next five years. * Source: Green Street Advisors Historically, people aged 60 and over have had a propensity to rent of approxi
Slide 14: Jobs are Returning; People With Highest Propensity to Rent are Getting Jobs
Economist Tom Lawler study results as posted on his blog, CalculatedRisk.com, and quoted in several prominent news publications. Source: BLS Current Population Survey, July 8, 2011. Represents year-over-year change in the civilian labor force, as defined by the BLS and used in the computation of BLS
Slide 15: Apartment Supply is Limited
Source: U.S. Census Bureau, Housing and Household Economic Statistics Division Long-term average 2Q 2011 homeownership rate is lowest since 1Q 1998. Every 1% decline in the homeownership rate translates into more than 1 million rental households. New supply remains limited in the short term. By 2013
Slide 16: Revenue growth projections versus peers
* Represents average revenue growth computed by Aimco based on 1) the average of revenue growth projections published by REIS, PPR and AXIOMetrics as of 1Q 2011, and 2) peer market allocation, weighted based on revenues, as reported in 1Q 2011 company reports. Aimco does not endorse or affirm the pr
Slide 17: Magnify Returns with Low-Risk Leverage
Leverage Strategy Leverage Strategy * For purposes of this analysis, peer group is comprised of AvalonBay, BRE, Camden, Colonial Properties, Equity Residential, Essex, Home Properties, Mid-America Apartments, Post Properties and UDR, companies that report weighted-average maturity. Source: SNL Finan
Slide 18: Aimco Value Proposition
Aimco Value Proposition Apartment demand, driven by favorable, predictable demographics, is strong. Apartment supply is limited and will return slowly as developers restart programs after several years on the sidelines. Favorable demand and supply fundamentals lead to rent growth. Aimco's portfolio
Slide 19: Aimco Growth Opportunity Greater than Peers
Earnings and Dividend Aimco's opportunity for dividend increases is greater than peers due to higher AFFO growth rate and current low payout ratio. Data source: Green Street Advisors, Real Estate Securities Monthly, August 1, 2011. Excludes impact of $0.15 of charges in 2011 associated with Freddie
Slide 20: Aimco's Shares are Priced at a Discount
By all measures, Aimco is a stronger company today. However, when compared to peers and to historical valuations, Aimco shares trade at a greater discount than they did during 2005. Measure (1) 2005 YTD2Q 2011 % Change Average rents $811 $1,070 +32% NOI margin 55% 62% +12% Free cash flow margin 47%
Slide 21: Aimco's Shares are Priced at a Discount: Data Sources
Data Sources: Company reports; SNL Financial Operating statistics for Aimco's conventional portfolio. Peer group comprised of AvalonBay, BRE, Camden, EQR, Home Properties, Mid-America Apartments, Post Properties and UDR. Colonial Properties has been excluded due to non-comparability of multi-family
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