Investor Presentation February/March 2012 For the period ended - - PowerPoint PPT Presentation

Investor Presentation

February/March 2012

For the period ended December 31, 2011.

Committed to Quality

• Ramco-Gershenson is a leading shopping center REIT focused on the ownership
• f high-quality shopping centers in major metropolitan markets.
• The Company’s assets primarily consist of large, multiple-anchor shopping

centers and market dominant supermarket centers.

• Our business plan is centered on three key objectives:
• Increasing the quality of our income stream through the lease-up of existing

vacancies and the replacement of underperforming tenancies with leading national retailers as well as the pursuit of opportunities to add value through redevelopment.

• Acquiring high-quality properties in metropolitan markets with capital

recycled from the disposition of lesser quality, non-core assets.

• Maintaining a strong balance sheet that promotes financial flexibility.
• 2

Major Accomplishments in 2011

3

All of the Company’s 2011 achievements support our commitment to quality:  Improved the core portfolio leased occupancy rate to 93.5% at year-end, compared to 91.0% at the end of 2010.  Signed 14 mid-box leases with national retailers including Bed, Bath & Beyond, buy buy Baby, Marshalls, Ross Dress for Less, Michaels, PetSmart, DSW Shoe Warehouse, and LA Fitness.  Increased same-center net operating income by 1.4%.  Sold four non-core shopping centers for a total of $58 million, including the fourth quarter sale of Taylors Square, the Company’s only center in South Carolina, at an average cap rate of 7.0%.  Entered the St. Louis, Missouri market acquiring two high-quality, market-dominant shopping centers with an aggregate purchase price of $77 million, at an average cap rate of 7.5%.  Closed over $400 million in financing, including $100 million of convertible preferred stock at 7.25%, $130 million in unsecured term loans, and a new $175 million unsecured line of credit.  Improved debt to EBITA to 7.0x, compared to 8.5x in 2010.

Our Properties and Markets

Focused on Metropolitan Markets

5

1MSA per US Census Bureau. Annualized base rents reported at 100%. 2Based on a three-mile trade area. 3Includes anchor-owned space.

• 80% of the Company’s total annualized

base rents come from ten leading MSA markets.[1]

• The Company’s centers in these markets

have an average trade area population

• f 66,217 and an average household

income of $83,191. [2]

• The centers in these markets are

primarily:

• Large, multiple-anchor shopping

centers with approximately 225,000 square feet and average

• ver 2 anchors per center.[3]
• Market-dominant supermarket

anchored centers producing above average sales of $445 per square foot.

• Have an average leased occupancy

rate of 93.7%.

Ramco’s top markets.

Metro Detroit Indianapolis Columbus

• Ft. Lauderdale/P. Beach

Milwaukee Jacksonville Atlanta Chicago

• St. Louis

Tampa/Sarasota

A Focus on High-Quality Properties: Large, Multiple-Anchor Shopping Centers

6 The Company’s shopping centers are predominantly multiple-anchor properties:

• 87% of shopping centers in our top markets are anchored by two or more national retailers.[1]
• Characteristics of our multiple-anchor shopping centers:
• Located in metropolitan markets with high barriers to entry.
• Positioned at dominant retail intersections.
• Diversified tenant mix of value oriented, destination retailers.
• Resilient to market downturns with multiple-anchor tenancies, while providing catalyst for

strong NOI growth potential.

1Based on Annualized Base Rents as of December 31, 2011, for those properties in the

Company’s top ten markets.

A Focus on High-Quality Properties: Market Dominant Supermarket Centers

7 The Company’s shopping center portfolio also includes market dominant grocery-anchored properties:

• 50% of shopping centers in our top markets are anchored by the leading supermarket in their

respective trade areas.[1][2]

• Characteristics of our market dominant supermarket shopping centers:
• High average annual sales of $445 per square foot.
• Top supermarket tenants include Publix, Kroger, Jewel-Osco, Meijer, and Whole Foods.
• Typically part of a shopping center that has at least one additional anchor tenant.

1Based on Annualized Base Rents as of December 31, 2011, for those centers in the

Company’s top ten markets.

2 Includes centers with one or more anchor and anchor-owned space.

Promoting Diverse, Credit-Quality Tenants

8

1Source: Latest tenant filings per CreditRiskMonitor for the quarter ended December 31, 2011.

Includes the combined wholly-owned and joint venture portfolio.

• The Company continually

evaluates its tenant roster and proactively manages its retail exposure.

• Recently Kmart dropped off the

Company’s top ten tenant list.

• The Company capitalizes on its

strong retailer relationships to replace underperforming tenants with national credits that have long-term growth potential.

• The Company’s portfolio is well-

balanced with national and regional tenancies. Local tenants represent less than 20%

• f the overall tenant profile.

Top Ten Tenants Credit Rating S&P/Moody's [1] Number of Leases % of Annualized Base Rental Revenue

T.J. Maxx/Marshalls A/A3 23 4.4% Home Depot BBB+/A3 3 2.0% Dollar Tree NR/NR 31 1.9% Publix Super Market NR/NR 8 1.8% OfficeMax B-/B1 11 1.7% Jo-Ann Fabrics B2/B 6 1.6% Burlington Coat Factory NR/NR 5 1.5% PetSmart BB/NR 7 1.5% Bed Bath & Beyond/buy buy Baby BBB+/NR 6 1.4% Best Buy BBB-/Baa2 5 1.4%

Leasing and Asset Management Initiatives

Adding High-Quality National Retailers

10

In 2011, the Company continued to improve the quality of its shopping center portfolio by filling mid-box vacancies, terminating and refilling dark but paying retailers, and replacing at risk tenants with high-quality national retailers.

• Signed 14 new mid-box leases with national, credit-quality tenants including; Bed, Bath & Beyond, buy buy Baby,

Marshalls, Michaels, PetSmart, DSW Shoe Warehouse, and LA Fitness.

• Proactively responded to Border’s pending bankruptcy by releasing two of three stores to national credit anchors.
• Leased 9 of 11 vacancies created by the bankruptcy of Linens ‘N Things and Circuit City.
• Generating creative solutions to accommodate mid-box anchors’ smaller format stores.
• All mid-box retailers signed in 2010 and 2011 will be in occupancy by the end of 2012 achieving full year income

effect in 2013. 2011 2010 Number of new mid-box leases signed 14 23 Unleased mid-boxes 8 15 Dark and Paying Anchors 4 9

Re-Anchoring Case Study

11

Mission Bay Plaza

Boca Raton, FL

• Mission Bay is a 260,000 square

foot dominant, multiple- anchored shopping center that commands average base rents

• f approximately $21.00 per

square foot.

• Re-anchoring project involved

the replacement of a vacated Albertson’s store with Golfsmith and The Fresh Market.

• The value-add project also

included the signing of a new 20 year land lease with TD Bank.

• Signed over 20,000 square feet
• f small shop space in tandem

with the re-anchoring project.

• Center is currently 93.0%

leased.

Toys “R” Us LA Fitness Office Max

Albertsons

Re-Anchoring Case Study

12

Marketplace of Delray

Delray Beach, FL

• The Marketplace of Delray is a

230,000 square foot dominant, multiple-anchored shopping center in a large and affluent trade area.

• Value-add re-anchoring project

included the downsizing of Office Depot to their newest format.

• Downsizing allowed for the

addition of Dollar Tree and Ross Dress for Less.

• Signed over 15,000 square feet
• f small shop space in tandem

with re-anchoring project.

Vacant Local Anchors

Office Depot Winn-Dixie Beall’s Outlet

Ramp-Up in Leasing Efforts Producing Results

13 In 2011, Ramco-Gershenson was successful in improving efficiencies in its lease process:

• Implemented new short-form lease reducing cost and time spent on lease documentation.
• Compressed the timeline from securing tenant interest through execution to store opening.
• Initiated program of fixed CAM charges with annual increases.

Improving Operating Metrics Year-End 2011 Year-End 2010 Leasing Velocity 2,029,980 SF 2,461,752 SF Average Base Rent, per square foot $11.32 $10.98 Renewal Retention Rate 82% 75% Renewal Leasing Spreads 1.5%

• 6.0%

Comparable Lease Spreads[1] 1.4% n/a Leased Occupancy 93.5% 91.0% Same Center NOI 1.4%

• 1.6%

The Company’s commitment to an aggressive leasing effort produced improved operating results:

1For spaces vacant less than 12 months.

Capital Recycling

Enhancing Quality through Capital Recycling

15

Dispositions:

• Identified $25-50 million of non-core properties to be sold in 2012.
• Sales will generate capital for investment in high-quality centers in target markets.
• Recycling program goals include improving the Company’s trade area demographic

profile and portfolio quality as well as reducing the concentration in its top two markets by diversifying into strong markets. Acquisition Criteria:

• Metropolitan, in-fill locations with high average household incomes.
• Multiple-anchor or market dominant supermarket anchored centers.
• Opportunities to drive additional income and value.

High-Quality Acquisition

16

Town & Country

Town and County (St. Louis), Missouri

Acquisition Highlights:

• Affluent trade area with 3 mile population of 65,771 and average

household incomes of $115,790.

• Anchored by Whole Foods, one of only two Whole Foods in the

metropolitan area. Shadow-anchored by Target.

• Lease-up, outparcel, and mid-box pad opportunity.
• Second acquisition of a multiple-anchor shopping center, with a

market dominant grocer, in metropolitan St. Louis.

Value-Added Redevelopment and Development

Redevelopment and Development Opportunities

18

Redevelopment

• The Company has a long history of adding value to its shopping centers through creative

redevelopments completing over 50 projects in the past 15 years.

• Two redevelopments are currently under construction:
• An expanded Whole Foods (35,000 SF) at Shops on Lane in Arlington, OH, which is

also anchored by Bed, Bath & Beyond.

• A new LA Fitness (45,000 SF) at Peachtree Hill in Duluth, GA, which is also anchored

by Kroger. Development

• Multiple-anchor Parkway Shops development project commenced in Jacksonville, Florida

adjacent to the Company’s River City Marketplace shopping center. The combination of the two centers solidifies the Company’s retail dominance in the North Jacksonville, Florida area.

• Goal of selling or developing 20%, or approximately $16 million, of non-productive land in

2012.

In Process Redevelopment

19

• Dominant, upscale shopping center in

close proximity to The Ohio State University is being expanded to meet the needs of a growing trade area.

• Approximately doubling the size of

Whole Foods to new prototype store while eliminating 10,000 square feet of unproductive shop space.

• Upon completion, the Whole Foods/Bed,

Bath & Beyond anchored shopping center will be 100% occupied.

Demographics (3 mile): Population 116,585 HH Income $64,239 Scheduled Completion Date: September 2012

Shops on Lane Avenue

Upper Arlington (Columbus), Ohio

Parkway Shops Development

20

Project Specifications:

• Phase 1: Approximately 90,000 square feet, anchored by Dick’s Sporting Goods and Marshalls, plus 20,000 SF of small shop space.
• Anchors represent approximately 80% of GLA.
• Planned outparcel sales of approximately $6.0 million.
• 11% return on incremental costs.
• Adjacent to the Company’s 900,000 square foot River City Marketplace.

Existing River City Marketplace

Building and Maintaining a Strong Balance Sheet

Continuing to Fortify a Sound Capital Structure

22

.

The Company has focused its efforts on reducing leverage, improving debt metrics, increasing liquidity, and enhancing financial flexibility. The following 2011 activities supported these goals:

• Raised $100 million of convertible preferred stock at 7.25%.
• Closed a new three-year $175 million unsecured line of credit.
• Closed a new five-year $75 million unsecured term loan at a fixed rate of 3.47%.
• Closed a new seven-year $60 million unsecured term loan at a fixed rate of 4.20%.
• Generated $58 million in non-core asset sales.
• Increased pool of unencumbered assets to approximately $565 million.

Improved Capital Structure

23

1Total Net Consolidated Debt includes capital lease obligations, net of cash. 2Excludes pro rata share of unconsolidated joint venture debt. 3Based upon year-to-date EBITDA annualized.

Improving Debt Metrics December 31, 2011 December 31, 2010 Total Net Consolidated Debt[1][2] $512.7 million $568.1 million Average Term[2] 6.1 years 4.7 years Debt to EBITDA[3] 7.0x 8.5x Interest Coverage Ratio[3] 2.5x 2.0x Fixed Charge Coverage Ratio[3] 1.8x 1.8x Unencumbered Assets $565 million <$100 million

At December 31, 2011, the Company had $12 million in cash and $144 million in borrowing capacity under its $175 million unsecured line of credit.

Eliminating Near-Term Debt Maturities

24

• Extended average consolidated debt maturities to 6.1 years in 2011, compared to 4.7 years in 2010.
• Only $15.0 million of debt maturing in 2012.

[1]$75 million term loan shown assuming company exercises option to extend maturity one year from 2015 to 2016.

$0.0 $50.0 $100.0 $150.0 $200.0 $250.0 2012 2013 2014 2015 2016 2017 2018 2019+

($ in millions)

Mortgage Unsecured JV Mortgage (at pro rata share)

$15.0 $82.4 $31.3 $92.2 $77.1

Debt Maturity Schedule as of December 31, 2011

$89.7[1] $113.4 $86.2

2012 FFO Guidance

25

The Company’s 2012 business plan is focused on three key objectives; driving high- quality NOI in its core shopping centers, executing on a capital recycling program designed to increase overall portfolio quality, and maintaining a sound capital structure. The Company’s FFO guidance for the full-year 2012 is $0.94 to $1.02 per diluted share. The 2012 guidance is based on the following key assumptions:  Core portfolio leased occupancy of between 93.0% - 94.0%.  An increase in same-center net operating income of 1.0% - 2.0%.  Management and leasing fees of approximately $3.0 million.  General and administrative expenses of approximately $19.0 million.  Gains on land sales of $1.0 million to $2.0 million.  Acquisitions of $25 million to $50 million.  Dispositions of non-core assets of up to $50 million.

Quality of FFO Strengthened in 2012

26

An ever increasing percentage of FFO is being generated by the Company’s core

• perations. This improvement in the quality of FFO between 2011 and 2012 is

reflected in the following accomplishments and assumptions:  Improving income quality achieved through leases with national, creditworthy tenants such as TJ Maxx, Bed, Bath & Beyond, and Ross Dress for Less.  Increasing and sustainable income from joint ventures.  Lower lease termination fees and gains on land sales expected.  Lower leverage in a primarily fixed rate debt structure.  A stronger impact from cash rents weighed against a projected negative impact from straight-line rents.

Long-Term Strategic Objectives

• Generate sustainable same-center NOI growth of between 2.5% to 3.5% each year,

through aggressive leasing and asset management initiatives.

• Execute on a capital recycling program designed to grow the Company, enhance the

quality of the portfolio and increase market concentration in targeted trade areas through the acquisition of high-quality shopping centers and the disposition of non- core properties.

• Continue to maintain a strong, flexible balance sheet to support the achievement of

the Company’s long-term goals.

27

Safe Harbor Statement

28

Information included herein contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the “Securities Act”, and Section 21E of the Securities Exchange Act of 1934, as amended, or the “Exchange Act.” You can identify these forward-looking statements by our use of the words “believe,” “anticipate,” “plan,” “expect,” “may,” “might,” “should,” “will,” “intend,” “estimate,” “predict” and similar expressions, whether in the negative or

• affirmative. These forward-looking statements represent our expectations or beliefs concerning future events, including:

statements regarding future developments and joint ventures, rents, returns, and earnings; statements regarding the continuation of trends; and any statements regarding the sufficiency of our cash balances and cash generated from

• perating, investing, and financing activities for our future liquidity and capital resource needs. We caution that although

forward-looking statements reflect our good faith beliefs and reasonable judgment based upon current information, these statements are not guarantees of future performance and are qualified by important factors that could cause actual results to differ materially from those in the forward-looking statements, because of risks, uncertainties, and factors including, but not limited to: the final size of the offering; our success or failure in implementing our business strategy; economic conditions generally and in the commercial real estate and finance markets specifically; our cost of capital, which depends in part on our asset quality, our relationships with lenders and other capital providers; our business prospects and outlook; changes in governmental regulations, tax rates and similar matters; and our continuing to qualify as a REIT. Further, we have included important factors under the heading “Risk Factors” and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2010, and other periodic reports, that we believe could cause our actual results to differ materially from the forward-looking statements that we make. All forward-looking statements are made as of the date hereof or the date specified herein, based on information available to us as of such date. Except as required by law, we do not undertake any obligation to update our forward-looking statements or the risk factors contained herein to reflect new information or future events or otherwise. You are cautioned not to place undue reliance on forward-looking statements.

Investor Presentation

February/March 2012

For the period ended December 31, 2011.