23 slides from Safehold Inc. New's earnings presentation, 2022
Slide 1: Q3 '22 Earnings Results
Q3 ‘22 EARNINGS RESULTS
Slide 2: Forward-Looking Statements and Other Matters
Forward-Looking Statements and Other Matters This presentation may contain forward-looking statements. All statements other than statements of historical fact are forward-looking statements. These forward- looking statements can be identified by the use of words such as “illustrative”, “representati
Slide 3: Forward-Looking Statements and Other Matters
Forward-Looking Statements and Other Matters Inflation Adjusted Yield / CPI Adjustments: Safehold™ originated ground leases typically include a periodic rent increase based on prior years cumulative CPI growth with the initial lookback year generally starting between lease year 11 and 21. These CPI
Slide 4: The Next Step in Safehold's Progression
The Next Step in Safehold’s Progression A Better Safehold Safehold and iStar have agreed to combine to create the only self-managed, pure-play ground lease company in the public markets Better Better Better Structure Cost & Economics Debt & Equity Profile Enhances governance, Lowers costs as New Imp
Slide 5: Q3 '22 Highlights
Q3 ’22 Highlights Strong Solid Sizable Earnings Investments Capital Sources $46.4m $284m $756m Net Gain from Sale of a New Ground Lease Cash & Credit Facility Ground Lease Investments(1) Availability(2) 52% $597m $2.0b Quarterly Y/Y Net UCA Growth Caret Valuation based on Revenue Growth Most Recent
Slide 6: Investment Activity
Investment Activity Quarterly Activity Origination Metrics 6 ground lease transactions $284m (1) All multifamily Originations 5 markets (1 new market) $255m Funded $29m Unfunded 2 new clients, 4 repeat clients (2) 6.0% w.a. Inflation Adjusted Yield • 5.8% with 0% inflation $303m 37% w.a. GLTV (3) Fu
Slide 7: Portfolio Growth
Portfolio Growth Q3 ’22 Investments $6.1b 18x Growth (1) Since IPO $4.0b $2.9b $1.5b $0.8b $0.3b IPO Q3 '18 Q3 '19 Q3 '20 Q3 '21 Q3 '22 (6/22/2017) Note: Please see the “Important Note re COVID-19” in the front of this presentation for a statement about metrics this quarter. Pictures of properties t
Slide 8: Earnings Results
Earnings Results Quarterly Year-to-Date Results Results Y/Y Y/Y Q3 ‘22 Q3 ‘21 YTD ‘22 YTD ‘21 Growth Growth Revenue $71.7m $47.3m 52% $196.9m $135.0m 46% Net Income GAAP $66.1m $20.2m 227% $113.6m $51.8m 119% Attributable to Safehold Inc. Excluding Merger & common Caret Related Costs (1) shareholder
Slide 9: Attractive Ground Lease Realization
Attractive Ground Lease Realization In Q3 ’22, Safehold sold a ground lease in the Washington D.C. MSA for $136.0m, generating a gain for Safehold of approximately $55.8m (gross of Caret allocations to third parties) Safehold originally purchased the asset in December 2020 for $76.7 million After pa
Slide 10: Inflation Captured Cash Flows
Inflation Captured Cash Flows (Current Portfolio Gross Book Value: $5,786m) CPI Lookbacks continue periodically through the life of the lease, which can provide meaningful inflation capture unlike the long-term fixed-rate bonds we benchmark against.(1) In-Place with 0% Inflation Annualized Cash Yiel
Slide 11: Portfolio Metrics
Portfolio Metrics (Current Portfolio Gross Book Value: $5,786m) Property Type Lease Term >60 yrs Office Multifamily 94% 45% 35% (36 Assets) (66 Assets) Lease Term Underlying Remaining Property w/ Ext. (128 Assets) (W.A. 93 Years) <20 yrs 4% Hotel 20-60 yrs 12% 2% Mixed Use & Other Life Science (16 A
Slide 12: Geographic Breakdown
Geographic Breakdown (Current Portfolio Gross Book Value $5,786m) Seattle Northeast 39% Portland (22 assets) Minneapolis West Milwaukee Boston Sacramento 26% Detroit (35 assets) San Francisco Central New York Denver Salt Lake City 3% Chicago Philadelphia (6 assets) Baltimore San Jose Washington, D.C
Slide 13: Capital Structure
Capital Structure Debt Overview Credit Ratings Non-Recourse Secured $1,498m Baa1 Total Moody’s (Upgraded to Positive Outlook in Q3 ’22) Unsecured Notes $3.8b Pro-Rata Held by JVs $1,375m $272m Unsecured Revolver BBB+ $630m Fitch ($720m remaining capacity) (Stable Outlook) (1) 24 year w.a. maturity (
Slide 14: Estimated Unrealized Capital Appreciation
Estimated Unrealized Capital Appreciation (1) $10.5b Total Square Feet: 32.7m 83% +$597m CAGR in Q3 ’22 Multifamily Office Since IPO 14.4m 13.2m $6.7b Sq. Ft. Sq. Ft. (15.9k Units) $5.1b Mixed Use Hotel Life Science & Other $2.8b 3.8m 0.7m 0.7m $1.6b Sq. Ft. Sq. Ft. Sq. Ft. (5.1k Keys) $0.4b IPO Q3
Slide 15: Caret Update
Caret Update In Q3 ’22, we announced that MSD Partners committed to purchase 1.0% of the total authorized Caret Units for an aggregate $20.0 million implying a valuation of $2.0 billion with no redemption options(1) Caret Ownership • Inclusive of all commitments, Safehold will own ~83% of outstandin
Slide 16: Caret Timeline
Caret Timeline 2H ’18: Formed a subsidiary called “Caret” Feb ’22: to track the capital appreciation Outside investors participate in above Cost Basis. Employee Series A round(4) performance-based incentive plan created 100+ +$8.9b Baa1/BBB+ Assets(1) UCA(2) Credit Rating(3) May ’19: Management ince
Slide 17: Appendix
APPENDIX Safehold
Slide 18: Income Statements
Appendix Income Statements For the three months ended September 30, For the nine months ended September 30, 2022 2021 2022 2021 Revenues: Interest income from sales-type leases $54,736 $30,145 $146,014 $83,244 Operating lease income 16,507 16,992 49,925 51,367 Other income 453 144 1,004 390 Total re
Slide 19: Balance Sheets
Appendix Balance Sheets September 30, 2022 December 31, 2021 Assets: Net investment in sales-type leases $3,066,113 $2,412,716 Ground Lease receivables 1,326,632 796,252 Real estate: Real estate, at cost 740,971 740,971 Less: accumulated depreciation (32,864) (28,343) Real estate, net 708,107 712,62
Slide 20: Portfolio Reconciliation
Appendix Portfolio Reconciliation IPO (6/22/17) 9/30/18 9/30/19 9/30/20 9/30/21 9/30/22 Net investment in Sales-Type Leases - - $465 $1,089 $1,802 $3,066 Ground Lease receivables - - 73 $480 $691 $1,327 Pro-rata interest in Ground Leases held as equity method investments - - - $344 $439 $444 Real es
Slide 21: Earnings Reconciliation
Appendix Earnings Reconciliation For the three months ended September 30, For the nine months ended September 30, 2022 2021 2022 2021 Net income attributable to Safehold Inc. common shareholders $66,077 $20,204 $113,628 $51,844 Less: Gain on sale of Net Investment in Lease (55,811) - (55,811) - Less
Slide 22: Unrealized Capital Appreciation Details
Appendix Unrealized Capital Appreciation Details Refer to the Glossary in the Appendix for a definition of Owned Residual Portfolio, Unrealized Capital Appreciation (“UCA”), and “Combined Property Value” (“CPV”). SAFE relies in part on CBRE’s appraisals of the CPV of our portfolio in calculating UCA
Slide 23: Glossary
Appendix Glossary Aggregate Cost Basis Represents Cost Basis plus unfunded commitments. For unfunded commitments, it represents the aggregate future amount to be paid under the commitments. Represents the Current Portfolio plus unfunded commitments. For unfunded commitments, it represents the aggreg