Sunstone Hotel Investors, Inc. · NYSE:SHO
Sunstone Hotel Investors — Investor Presentation (September 2011)
21 slides from Sunstone Hotel Investors's investor presentation, September 2011
Slide 1: Company Presentation
SUNSTONE HOTEL INVESTORS, INC Company Presentation September 2011
Slide 2: Forward-Looking Statements
SUNSTONE HOTEL INVESTORS, INC Forward-Looking Statements This presentation contains forward-looking statements that have been made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. These statements relate to future events or our future financial performance. In some
Slide 3: Company Profile
SUNSTONE HOTEL INVESTORS, INC Company Profile Hotel investment company with an enterprise value of over $2.4 billion Capital Structure / Valuation Metrics Sunstone Portfolio Metrics Shares 118.3M Hotels 32 Stock Price (September 15, 2011) $5.95 Rooms 13,206 Equity Market Cap $704M 2010 Pro Forma Rev
Slide 4: Deep and Aligned Management Team
SUNSTONE HOTEL INVESTORS, INC Deep and Aligned Management Team Newly redefined management team singularly focused on driving shareholder value Ken Cruse President & CEO Hotel/Real Estate: 20 years Marc Hoffman John Arabia EVP & COO EVP & CFO Hotel/Real Estate: 34 years Hotel/Real Estate: 25 years Gu
Slide 5: Institutional Quality Portfolio
SUNSTONE HOTEL INVESTORS, INC Institutional Quality Portfolio Exceptional portfolio of thirty-two institutional-quality, primarily upper-upscale hotels 1,190-room Hilton San Diego Bayfront 781-room Renaissance Orlando 460-room Doubletree Guest Suites 16.0% of 2010 Hotel EBITDA 5.7% of 2010 Hotel EBI
Slide 6: Balanced Geographic Distribution
SUNSTONE HOTEL INVESTORS, INC Balanced Geographic Distribution Geographically diverse portfolio located primarily in urban markets, particularly concentrated on the coasts 2010 Total EBITDA by Region (number of hotels in parenthesis) Mid-West (7) 12% Northeast (9) 43% • DC/Baltimore 17% (3) West (12
Slide 7: Expanding our Reach
SUNSTONE HOTEL INVESTORS, INC Expanding our Reach We own a geographically diverse portfolio located primarily in urban markets, particularly concentrated on the coasts 2010 EBITDA 2010 EBITDA Hotel Rooms (in millions) Hotel Rooms (in millions) Northeast Region West Region Marriott Boston Long Wharf
Slide 8: Proven Acquisitions Execution
SUNSTONE HOTEL INVESTORS, INC Proven Acquisitions Execution Three major urban hotels acquired at attractive spreads to our WACC in off-market deals 2010 Metrics(1) Doubletree Guest JW Marriott New Hilton San Diego Total Suites Times Square Orleans Bayfront No. Keys 460 494 1,190 2,144 RevPAR $302.25
Slide 9: Rapidly Increasing EBITDA
SUNSTONE HOTEL INVESTORS, INC Rapidly Increasing EBITDA Cash flow growth driven by disciplined investments and proactive asset management Pro Forma Adjusted Corporate EBITDA Buildup $225.0 $8.1- $19.1 $200.0 $175.0 $58.6 $210- $150.0 $14.6 $201.9 $221 $157.9 $125.0 $100.0 2010 Actual Adjusted Sold H
Slide 10: Mission and Business Plan
SUNSTONE HOTEL INVESTORS, INC Mission and Business Plan Mission Sunstone will generate superior, risk-adjusted shareholder returns through disciplined acquisitions of institutional-quality hotels, proactive asset management, and by maximizing financial flexibility and minimizing our cost of capital
Slide 11: Value Enhancing Initiatives
SUNSTONE HOTEL INVESTORS, INC Value Enhancing Initiatives Improving portfolio quality and growth through select renovations In 2011, we expect to invest approximately $120 – $140 million renovating and repositioning our portfolio. Most of these projects were completed in the first half of 2011, in
Slide 12: Recent Renovations
SUNSTONE HOTEL INVESTORS, INC Recent Renovations Improving portfolio quality and growth through select renovations Marriott Boston Long Wharf lobby renderings: COMPANY PRESENTATION • PAGE 12
Slide 13: Recent Renovations
SUNSTONE HOTEL INVESTORS, INC Recent Renovations Improving portfolio quality and growth through select renovations Renaissance Washington D.C. completed lobby renovation: COMPANY PRESENTATION • PAGE 13
Slide 14: Recent Renovations
SUNSTONE HOTEL INVESTORS, INC Recent Renovations Improving portfolio quality and growth through select renovations Philadelphia Marriott completed lobby renovation: COMPANY PRESENTATION • PAGE 14
Slide 15: Recent Renovations
SUNSTONE HOTEL INVESTORS, INC Recent Renovations Improving portfolio quality and growth through select renovations Renaissance Orlando themed pool experience and 10,000 sq. ft. function lawn - completed: COMPANY PRESENTATION • PAGE 15
Slide 16: Recent Renovations
SUNSTONE HOTEL INVESTORS, INC Recent Renovations Improving portfolio quality and growth through select renovations Renaissance Orlando themed pool experience and 10,000 sq. ft. function lawn - completed: COMPANY PRESENTATION • PAGE 16
Slide 17: Maximizing Financial Flexibility
SUNSTONE HOTEL INVESTORS, INC Maximizing Financial Flexibility Maintaining strong liquidity and access to capital. and lowering our cost of capital through a gradual and methodical reduction of our leverage Highly equitized acquisitions that will enhance our growth profile and if investment return
Slide 18: Maximizing Financial Flexibility
SUNSTONE HOTEL INVESTORS, INC Maximizing Financial Flexibility Maintaining strong liquidity and access to capital and lowering our cost of capital through a gradual and methodical reduction of our leverage 9.0x 2.40x Measured improvement of leverage profile Cyclical cash flow growth and 8.0x 2.2
Slide 19: Maximizing Financial Flexibility
SUNSTONE HOTEL INVESTORS, INC Maximizing Financial Flexibility Well staggered debt maturity schedule consisting of low rated, primarily single-asset secured mortgage debt Following the Doubletree refinance, ’12-’14 debt maturities of approximately $95M and principal amortization of $70M equate to le
Slide 20: Investment Thesis
SUNSTONE HOTEL INVESTORS, INC Investment Thesis Sunstone will generate superior, risk-adjusted shareholder returns through disciplined acquisitions of institutional-quality hotels, proactive asset management, and by maximizing financial flexibility and minimizing our cost of capital High-quality p
Slide 21: Company Presentation
SUNSTONE HOTEL INVESTORS, INC Company Presentation September 2011
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