Choice Properties Real Estate Investment Trust · TSX:CHP.UN
Choice Properties Real Estate Investment Trust — Q1 2024 Earnings Presentation
66 slides from Choice Properties Real Estate Investment Trust's earnings presentation, Apr 25, 2024
Slide 1: First Quarter Report 2024
2024 First Quarter Report Places People Thrive™
Slide 2: Forward Looking Statement
Forward Looking Statement Certain statements contained in this document constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to Choice Properties REIT’s (the "Trust”) future outlook and anticipated events or results and may include stat
Slide 3: Q1 2024 Financial and Operating Performance
Q1 2024 Financial and Operating Performance Q1 2024 Q4 2023 Q12023 $0.259 $0.255 $0.244 FFO(1) /unit /unit /unit +1.6% +6.1% $0.239 $0.176 $0.227 AFFO(1) /unit /unit /unit +35.8% +5.3% $238.5M $238.5M $232.9M Same-Asset NOI, Cash Basis(1) -- +2.4% 97.9% 98.0% 97.7% Occupancy -0.1% +0.2% 6.9x 7.2x 7.
Slide 4: Contents
Contents ••Purpose-Driven Strategy Canada’s Premier REIT ••Proven Strategic Framework ••Our Near-Term Focus ••3 Strategic Asset Classes ••Winning Retail Portfolio Market Leading Portfolio ••High-Demand Industrial ••Mixed-Use & Residential • Developing with Purpose Transformational Development ••Deve
Slide 5: Canada's Premier REIT
Canada’s Premier REIT ChoiceProperties
Slide 6: Canada's Premier REIT
Canada’s Premier REIT Leading where it matters most (1) Unmatched Necessity- Strategic Relationship with Largest in Canada Based Portfolio Canada’s Leading Retailer High-quality 82% Necessity-based 56% Loblaw tenancy(3) 700+ properties retail portfolio(2) Strategic asset 38M Grocery-anchored Relatio
Slide 7: Purpose-Driven Strategy
Purpose-Driven Strategy Choice Properties is a leading Real Estate Investment Trust that creates enduring value by building places where people thrive. We bring this to life by improving how our tenants and communities come together to live, work, and connect. This includes our industry leadership i
Slide 8: Proven Strategic Framework
Proven Strategic Framework Creating Preservation Stable and growing Increases in NAVand G O ALS Enduring Value: of capital cash flows distribution overtime Maintaining Care 1 market-leading portfolio Ownership P R IO R IT IE S Sustaining VALU ES 2 operational excellence Respect CORE Delivering 3 Val
Slide 9: Our Near-Term Focus
Our Near-Term Focus 1 Maintaining 2 Sustaining 3 Delivering Priorities market-leading operational development portfolio excellence pipeline Executing on our near-term Maximizing value in our Industrial opportunity Building for core asset classes Delivering best-in-class property Creating value by th
Slide 10: Market Leading Portfolio
Market Leading Portfolio ChoiceProperties
Slide 11: 3 Strategic Asset Classes
3 Strategic Asset Classes A high-quality national footprint where Canadians live and work 705 Income Producing Properties 66.1 M Square Feet $16.7B Fair Value(1) Retail Industrial Mixed-Use & Portfolio Mix by Properties Under Residential Asset Class(2) Development Predominately Flexible well-located
Slide 12: 3 Strategic Asset Classes
3 Strategic Asset Classes Percentage of NO(1) 97.9% Total Occupancy (1) Calculated as a % of total NOI on a proportionate share cash basis for the three months ended March 31, 2024
Slide 13: Stable and Consistent Occupancy
Stable and Consistent Occupancy Period-End Occupancy Occupancy by Asset Class Retail 97.7% Industrial 98.8% Mixed-Use & 94.7% Residential(1) Total 97.9% (1) Segment includes remaining office properties; occupancy disclosed excludes residential units.
Slide 14: Long-Term Leases
Long-Term Leases High quality tenants provides cash flow stability Lease Expiry by Year Weighted Average Lease Term Loblaw Ancillary Total 6.3 5.3 5.9 years years years
Slide 15: Winning Retail Portfolio
winning Retail Portfolio Necessity-based, well-located properties supported by strong anchor tenants 15
Slide 16: Winning Retail Assets
Winning Retail Assets Predominantly necessity-based grocery anchored retail portfolio 44.8M 573 sq. ft. of GLA properties $11.1B 97.7% fair value(1) occupancy (1) Proportionate share basis.
Slide 17: Strong Necessity-Based Retail Anchor Tenants
Strong Necessity-Based Retail Anchor Tenants Reliable and stable cash flow +64% of retail revenue from Loblaw banners +68% of retail revenue is from grocery and pharmacy +82% of retail revenue from necessity-based retail Calculated as a % of the retail segment’s gross rental revenue on a proportiona
Slide 18: Retail Footprint
(1) Retail Footprint 85% of properties located at key intersections Square Footage Necessity- NOI(1) (M) based(2) Neighbourhood Centres 39.4 88% 89% Power Centres 5.4 12% 35% Total 44.8 82% (1) Calculated as a % of the retail segment’s NOI on a proportionate share cash basis for the three months end
Slide 19: Strong Tenant Retention
Strong Tenant Retention Reliable and stable cash flow Lease Expiry by Year 97.7% in-place occupancy • Staggered renewals • High probability of renewal • Strong covenant tenants
Slide 20: High-Demand Industrial
High-Demand Industrial High-quality generic industrial assets in key distribution markets
Slide 21: High-Demand Industrial
High-Demand Industrial Flexible well-located industrial portfolio 19.5M 121 sq. ft. of GLA properties $3.9B 98.8% fair value(1) occupancy (1) Proportionate share basis.
Slide 22: High-Demand Industrial
(1) High-Demand Industrial 86% of industrial assets are generic and nigh quality Square Footage % of Total (M) • Distribution 16.8 86% . Warehouse (2) 2.7 14% Total GLA 19.5 (1) Calculated as a % of total GLA as at March 31,2024. (2) Warehouse includes certain Small Bay assets. Q1 2024 • High-Demand
Slide 23: Resilient Industrial Tenant Base
Resilient Industrial 29% Tenant Base Loblaw gross revenue(1) Top 10 Industrial Tenants(1) 1 Loblaw 2 Amazon 3 Canada Cartage 4 Wonderbrands 5 PetValu 6 NFIIPD 7 Uline Canada Corporation 8 Canadian Tire 9 Kimberly-Clark 10 Alberta Gaming, Liquor and Cannabis (1) Calculated as a % of the industrial se
Slide 24: Significant Embedded Growth
Significant Embedded Growth Major Market Breakdown Choice Market $9.16 Avg. Rent(1) Avg. Rent(2) Vancouver $13.91 $21.48 Choice avg. in-place rent(1) Calgary $8.14 $11.35 $16.06 Greater Toronto Area $8.88 $18.09 Greater Montreal Market avg. rent(2) $9.88 $16.03 Area (1) Average in-place rent per squ
Slide 25: Mixed-Use & Residential
Mixed-Use & Residential Purpose-built rental in key markets
Slide 26: Mixed-Use & Residential
Mixed-Use & Residential Transit oriented mixed-use and residential portfolio 1.8M 11 sq. ft. of GLA(1) properties S0.9B 94.7% fair value(2) Occupancy(3) (1) 1.8 million sq. ft. of GLA includes 0.7 million sq. ft. associated with Choice’s 923 residential units. (2) Proportionate share basis (3) Occup
Slide 27: Mixed-Use & Residential Properties
Mixed-Use & Residential Properties Liberty House The Brixton Mount Pleasant Village Element Residential Residential Residential Residential Toronto, ON Toronto, ON Brampton, ON Ottawa, ON Units 440 units Units 397 units Units 302 units Units 252 units Ownership 50% Ownership 50% Ownership 50% Owners
Slide 28: Transformational Development
Transformational Development
Slide 29: Developing with Purpose
Developing with Purpose Diversifying our tenant base while delivering steady growth Retail Intensifications Near-Term Industrial Mixed-Use & Residential Delivering steady growth and Capitalizing on market trends with Transforming communities with maintaining portfolio quality 6.0M sq. ft of high-qua
Slide 30: Development Pipeline Positioned for Growth
Development Pipeline Positioned for Growth Driving near, medium and long-term value 16.7M sq. ft. Sq.ft.(1) In Planning Zoned & Ready Active Total Retail - 0.1 M 0.1 M ► 0.2M Industrial - 4.2M 1.8M ► 6.0M Mixed-Use & Residential 6.9M 3.6M - ► 10.5M Total 6.9M 7.9M 1.9M ► 16.7M (1) At the Trust's Sha
Slide 31: On the Move
On the Move Strengthening our portfolio with active development projects Projects under Sq. ft. upon Total active development completion(1) investment(1) Retail 14 0.1 M $62M Industrial 2 1.8M S349M Residential(2) 1 - S2M Total 17 1.9M $413 M (1) Estimated upon completion, at the Trust's Share. (2)
Slide 32: Industrial Development Pipeline
Industrial Development Pipeline Immense near-to-medium term opportunity within active and in planning developments Choice Caledon Business Park (Buildings A&H) 6.0M sq. ft. zonecl(1) Caledon, ON 2 Projects 364 Net Developable Acres(1)(2) 0.9M 2024 completions sq. ft(1) Rendering 5.1M 2025+ completio
Slide 33: Mixed-Use and Residential Development Pipeline
Mixed-Use and Residential Development Pipeline Significant future growth Golden Mile 25 Photography Dr. 13 Toronto, ON Toronto, ON Projects in planning 10.5M Potential Density sq.ft (1) Potential 3,597 total units 2,356 total units 12,257 Residential Units(1) 19 acres 7.7acres 3.2M sq. ft. 2.1 M sq.
Slide 34: Prudent Financial Management
Prudent Financial Management
Slide 35: Measuring Financial Success
Measuring Financial Success Proven Stability. Positioned for Growth. Stable and growing cash flows FINANCIAL GOALS Priorities from existing portfolio • Maximizing value in our core asset classes 1 • Improving quality through balanced capital recycling Preservation Maintaining • Delivering best-in-cl
Slide 36: Significant Financial Capacity
Significant Financial Capacity 1.9x BBB (High) below peer average(2) DBRS credit rating $12.9B 6.9 unencumbered assets(1) 8.9 7.6 7.5 7.3 7.2 7.2 $1.5B unused portion of 2018 2019 2020 2021 2022 2023 Q12024 revolving credit facility(1) (3) Adjusted Debt to EBITDAFV (1) As at March 31, 2024. (2) Sour
Slide 37: Capital Structure Targets
Capital Structure Targets Maintaining financial stability Mortgages and $1.6B 9% Secured Facilities(4) Q12024 Target Range Unsecured $5.4b Unused portion of Debentures $1.5B > $1.0B revolving credit facility 31% Unsecured Credit Facility $0.0B ($I.5B total capacity) Adjusted Debt to EBITDAFV(1) 6.9x
Slide 38: Debt Maturity Profile
(1) Debt Maturity Profile 4.02% 5.7 Well-balanced debt ladder Years WAIR(2) WATM(2) (1) As of March 31, 2024, on a proportionate share basis. (2) Reflects senior unsecured debentures and fixed-rate secured debt.
Slide 39: Environmental, Social & Governance Program
Environmental, Social & Governance Program
Slide 40: Building Healthy, Resilient Communities
Building Healthy, Building Healthy, Resilient Communities Resilient Communities Commitment to ESG practices is ESG program is focused integral to our purpose of around two pillars which creating enduring value. align with stakeholder interests: Aspire to develop healthy, resilient communities throug
Slide 41: Leading by Example in ESG
Leading by Example in ESG Read our ESG Report to learn more about our sustainability strategy, initiatives, and achievements www.choicereit.ca/sustainability A close-up of solar panels Description automatically generated Q1 2024 • Leading by Example in ESG 41
Slide 42: Appendices
Appendices ChoiceProperties
Slide 43: Transformational Industrial Development
Transformational Industrial Development
Slide 44: Choice Caledon Business Park, Caledon, ON
Choice Caledon Business Park • 380-net acres of industrial Caledon, ON development land • Excellent access to major highways and intermodals • Strong labour pool • Multi-phase industrial park • New generation logistic space • Phase 1 underway: 90-acre ground lease with Loblaw • Partner: Rice Group
Slide 45: Mixed-Use & Residential in Planning
Mixed-Use & Residential in Planning
Slide 46: Grenville & Grosvenor, Toronto, ON
Grenville & Grosvenor • 1-acre site in Downtown Toronto, ON Toronto • 700+ units • Provincial Affordable Housing Lands Program • Transit accessible • Partner: Greenwin 99 97 91 Walk Score Transit Score Bike Score
Slide 47: Golden Mile, Toronto, ON
• 19-acre site in Toronto • Adjacent to two new Golden Mile - Toronto. ON transit stations along Eglinton Crosstown LRT • Large mixed-use community • High density residential and retail
Slide 48: Golden Mile Phase 1, Toronto, ON
Golden Mile Phase 1 Toronto, ON • 1 rental tower and 2 condo towers • 1,350 units • Mixed-use • Community innovation district • Partner: Daniels
Slide 49: 720 Broadview Ave., Toronto, ON
720 Broadview Ave. • 3.3-acresite Toronto, ON • 500 units • 1 residential building • Directly across from Broadview TTC subway station • New grocery store • Dedicated public park
Slide 50: 2280 Dundas St. W - Toronto, ON
2280 Dundas St. W - Toronto, ON
Slide 51: 2280 Dundas St. W, Toronto, ON
2280 Dundas St.w • 13-acre site in Downtown Toronto, ON Toronto • Major transit hub (TTC, GO Train, UP Express) • Large mixed-use community • High density residential, retail and office
Slide 52: Parkway Forest Dr., Toronto, ON
Parkway Forest Dr. • 3-acresite Toronto, ON • 382 units • 1 residential building • Close proximity to Don Mills TTC subway station • Partner: Woodbourne Canada
Slide 53: 25 Photography Dr. - Toronto, ON
25 Photography Dr. - Toronto, ON
Slide 54: 25 Photography Dr., Toronto, ON
25 Photography Dr. • 7.7 -acre site Toronto, ON • 7 mixed-use buildings • Major transit hub (Eglinton Crosstown LRT, GO Train, UP Express) • Community integration
Slide 55: 685 Warden Ave., Toronto, ON
685 Warden Ave. • 6.5-acresite Toronto, ON • 1,500 units • 6 residential buildings • Directly adjacent to Warden TTC subway station • Dedicated public park
Slide 56: 985 Woodbine Ave. - Toronto, ON
985 Woodbine Ave. - Toronto, ON
Slide 57: 985 Woodbine Ave., Toronto, ON
985 Woodbine Ave. • 1.7-acre site in Toronto, ON Downtown Toronto • Two mid-rise rental residential buildings • 622 units • Directly adjacent to Woodbine TTC subway station • Grocery retail at-grade
Slide 58: 449 Carlaw Ave. - Toronto, ON
• 5.6-acre site • 3 mixed-use buildings • 1,080 units • Transit-oriented community • Future stop on Ontario Line 449 Carlaw Ave. - Toronto, ON
Slide 59: Immense Value Opportunity
Immense Value Opportunity Choice Properties continues to grow and create value through its pipeline of potential commercial and mixed-use developments.
Slide 60: Toronto
Toronto • 50 properties in the City of Toronto • Significant long-term development potential Retail 39 Q Industrial 1 Mixed-use & 5 Residential Q PUD 5 50
Slide 61: 17 Leslie St., Toronto, ON
17 Leslie st. • 6-acre site Toronto , ON • Close proximity to Queen Streetcar
Slide 62: 10 Lower Jarvis St., Toronto, ON
10 Lower Jarvis St. • 4-acresite Toronto, ON • Core downtown location
Slide 63: Greater Vancouver Area
Greater Vancouver Area • 19 properties in the GVA • Significant long-term development potential. Retail 16 Industrial 3 19
Slide 64: North Road, Coquitlam, BC
North Road • 7.8-acre site in city Coquitlam,BC centre • Access to two lines of Vancouver SkyT rain • Revitalization into mixed-use community • High density residential and retail
Slide 65: Montréal
Montréal • 38 properties in the GMA • Significant long-term development potential Retail 36 Industrial 2 38 Q1 2024 • Appendices • Immense Value Opportunity
Slide 66: Choice Properties
ChoiceProperties
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