Taking Retail to New Heights Investor Presentation February 2015 31500 Northwestern Highway, Suite 300 Farmington Hills, Michigan 48334 248.350.9900 www.rgpt.com
RPT Company Overview • Ramco-Gershenson Properties Trust owns and manages interests in 80 market dominant, multi-anchored community shopping centers primarily in a dozen major metropolitan markets. • The Company’s shopping centers are tenanted by best-in-class national and regional retailers, including TJ Maxx, Marshalls, LA Fitness, Bed Bath & Beyond, The Home Depot, Nordstrom Rack, Ross Dress for Less, Kohl’s, and Stein Mart. • Ramco- Gershenson’s centers average 260,000 square feet with five national anchors often featuring the trade area’s leading grocer, including Whole Foods, Publix, and Kroger, that generate average annual sales of approximately $515 per square foot. • The Company maintains a strong balance sheet with an investment grade profile and significant liquidity to support its growth initiatives highlighted by a net debt to EBITDA ratio of 5.9x. Woodbury Lakes – Woodbury, MN 2
In Summary-2014 Accomplishments • Acquired $322 million of high-quality shopping centers in trade areas with average household incomes of $85,500 tenanted by best-in-class retailers that pay on average $15.96 per square foot. • Sold 4 non-core shopping centers with average household incomes of $65,200 and average base rents of $8.69. • Redeveloping seven shopping centers for a total cost of $51 million which are expected to produce incremental returns of 10-11%. • Continued to post solid operating metrics highlighted by same-center growth of 3.3%, core portfolio occupancy of 95.5%, and comparable leasing spreads of 6.3%. • Maintained a strong balance sheet with net debt to EBITDA of 5.9x and fixed charge cover of 3.0x. Bridgewater Falls, Hamilton, OH 3
Ramco- Gershenson’s 2015 Business Plan Acquisitions/ Core Operations Redevelopment Dispositions At least $50 million Same-Center NOI Selective acquisitions • • • growth of between with the opportunity investment each year. 2.5% and 3.5%. to add value. Stabilized returns of • Leasing spreads of 6% Evaluate lowest 5% of 10% to 11% on • • to 8%. portfolio for sale incremental costs. Occupancy of >95%. opportunities. • Replace Acquire shopping Increase cash flow • • • underperforming centers with value- through small shop tenants with exciting add opportunities. lease-up and draws. Sell non-core centers increased spreads on • Create “Sense of to generate capital to • renewals. Place” to maintain fund business plan. Strengthen top tenant • relevance. Match funds in a lineup, proactively • Broaden customer competitive • addressing draw and increase acquisition underperforming market dominance. environment. tenancies. 4
CORE OPERATIONS A. Focused on Market Dominant Community Centers B. RPT’s High -Quality Retailers C. A Community Focused Approach D. Managing for Sustainability E. Building Quality-Delivering Results “Our commitment to improving portfolio quality and carefully managing our properties will remain a top priority in 2015.” Deerfield Towne Center – Mason, OH 5
Focused on Market Dominant Community Centers Averaging 260,000 Dominant Square Feet Multi-Anchored 5 Anchors Per Center Community 80% of Base Rent Centers 5-Mile Income of Strong $78,000 Demographics 5-Mile Population of 170,000 Creditworthy 90% Tenants National/Regional Comparable 6.3% Leasing Spreads Shops at Old Orchard, West Bloomfield, MI Note: As of December 31, 2014. GLA and anchor count includes shadow anchor space. 6
RPT’s High -Quality Retailers RPT’s Tenant Exciting Retail Top 10 Tenants Line-up Concepts The Company’s top • 1 4.5% of ABR tenant line-up is dominated by national 2 2.6% of ABR destination oriented retailers providing stability 3 2.5% of ABR in any economic environment. 4 1.8% of ABR The Company is focused • 5 1.8% of ABR on leasing to best-in-class national retailers with 6 strong credit and growth 1.7% of ABR profiles. 7 1.6% of ABR In addition to leading • 8 1.5% of ABR national tenants, the Company leases to the 9 most current regional and 1.5% of ABR local concepts to strengthen each center’s 10 1.4% of ABR merchandise mix. Note: As of December 31, 2014. 7
A Community Focused Approach Our Three Tiered Approach: 1. Merchandising Right mix of best-in-class national tenants and exciting regional and local retailers that drive traffic to the center and are unique to each community’s tastes and interests. 2. Placemaking Inviting environments to increase time spent at each center, improve shopper experience, and promote customer loyalty. 3. Marketing Identify and create opportunities that along with our “RPT Signature Events” will solidify the center’s importance within the Community. Front Range Village – Fort Collins, CO 8
Managing for Sustainability Nagawaukee Center – Waukesha, WI Deerfield Towne Center – Mason, OH The Shoppes at Fox River – Waukesha, WI RPT is committed to promoting the interests of society and its environment by thoughtfully • considering and responding to the impact of the Company’s business activities as it relates to its key stakeholders. The Company is aware of its presence in the community and the social and environmental • impact of owning and managing shopping centers. Everyday thousands of people visit a Ramco property creating a significant impact on both the social and environmental landscape. RPT’s Active Environmental Sustainability Initiatives Include: • Restoration, expansion and preservation of natural habitats including wetlands. • Installation of amenities friendly to mass transit including park-n-ride sites and bike paths. • Reduction in the use of potable water for irrigation by capturing run-off water supplies and rain sensor installation. • Reusing demolished portions of sites for parking lot bases and other structures. • Utilizing energy efficient LED lighting with automatic dusk to dawn timers. • Recycling milled asphalt for parking lot installation/improvement. 9
Building Quality - Delivering Results RPT has successfully transformed its portfolio over the last five years evidenced by its commitment to ever increasing average base rents and generating strong same- center NOI growth. Increasing Average Base Rents Generating Same-Center NOI Growth $13.20 4.0% $13.00 3.3% 3.3% 3.0% 3.0% $12.70 $12.35 2.0% $12.20 1.4% 1.0% $11.70 $11.54 $11.32 0.0% 2010 2011 2012 2013 2014 $11.20 $10.98 -1.0% $10.70 2010 2011 2012 2013 2014 -2.0% -1.6% 10
ACQUISTIONS AND DISPOSTIONS A. Focused on 12 Top Metropolitan Markets B. 2014 High-Quality Acquisitions C. Capital Recycling Drives Quality and Value “Recycling Capital from lower quality assets into high-quality investments will be a strong driver of both NOI and NAV growth this year.” Woodbury Lakes – Woodbury, MN 11
Focused on 12 Top Metropolitan Markets Michigan now accounts for only Minnesota #16 29% of the Minneapolis – Company’s rents. St. Paul RPT’s Top Markets 3.2% of ABR Milwaukee #39 MSA SE Michigan RPT’s top 12 metropolitan 5.1% of ABR #14 MSA 24% of ABR markets account for nearly Denver Chicago #21 MSA 90% of its pro rata Toledo #3 MSA 7.5% of ABR #89 MSA 4.1% of ABR annualized base rents. 3.3% of ABR Cincinnati #28 MSA The Company is focused on St. Louis 9.5% of ABR #19 MSA top MSAs; 11 of the 6.0% of ABR Atlanta Company’s targeted 12 #9 MSA 3.7% of ABR markets are in the top 40 MSAs in the US. Jacksonville #40 MSA 5.9% of ABR Taken together, the12 MSAs are home to 121 Fortune Tampa Bay 500 company headquarters #18 MSA 5.8% of ABR and 42.7 million people. SE Florida #8 MSA 11.3% of ABR 12
2014 High-Quality Acquisitions The Company invested $322 million in market dominant, multi-anchored shopping centers with significant value-add potential which builds earnings growth and enhances portfolio quality. ABR: $5.7 million $21.38 psf TOTAL GLA: 317,603 (Owned 305,086) MAJOR TENANTS: ABR: $8.5 million $19.38 psf Minnesota #16 TOTAL GLA: 792,945 (Owned: 459,307) Minneapolis – St. MAJOR TENANTS: Paul Denver Woodbury Lakes – Woodbury, MN Cincinnati #21 MSA Front Range Village – Fort Collins, CO #28 MSA ABR: $6.6 million $13.93 psf TOTAL GLA: 627,202 (Owned 503,502) MAJOR TENANTS: Quality Markers ABR: $2.5 million $9.15 psf TOTAL GLA: 277.533 Avg. Base Rent, MAJOR TENANTS: psf of $15.96 Bridgewater Falls - Hamilton, OH Avg. Household Income of $85,500 Buttermilk Towne Center – Crescent Springs, KY 13
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