Monmouth Real Estate Investment Corporation A Public REIT Since - - PowerPoint PPT Presentation

Monmouth Real Estate Investment Corporation

A Public REIT Since 1968

January 2019 Investor Presentation NYSE: MNR

This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements provide Monmouth Real Estate Investment Corporation’s current expectations or forecasts of future events. Forward-looking statements include statements about Monmouth’s expectations, beliefs, intentions, plans, objectives, goals, strategies, future events, performance and underlying assumptions and other statements that are not historical facts. You can identify forward-looking statements by their use of forward-looking words, such as “may,” “will,” “anticipate,” “expect,” “believe,” “intend,” “plan,” “should,” “seek,” or comparable terms, or the negative use of those words, but the absence of these words does not necessarily mean that a statement is not forward-looking. The forward-looking statements are based on Monmouth’s beliefs, assumptions and expectations of its future performance, taking into account all information currently available to it. Forward-looking statements are not predictions of future

• events. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are

known to Monmouth. Some of these factors are described under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as included in Monmouth’s Annual Report on Form 10-K for the fiscal year ended September 30, 2018 and its other periodic reports filed with the Securities and Exchange Commission, which are accessible on SEC’s Electronic Data Gathering, Analysis and Retrieval website, or “EDGAR” at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with other cautionary statements that are included in this presentation and in Monmouth’s SEC filings. These and other risks, uncertainties and factors could cause Monmouth’s actual results to differ materially from those included in any forward-looking statements it makes. Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for Monmouth to predict those events or how they may affect it. Except as required by law, Monmouth is not obligated to, and does not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance

• n these forward-looking statements, as events described or implied in such statements may not occur.

This presentation may include references to “FFO”, “Core FFO” and “AFFO”, which are non-GAAP financial measures. A reconciliation of “FFO”, “Core FFO” and “AFFO” to the most comparable GAAP financial measures is included in our most recent Annual Report on Form 10-K and/or our Supplemental Information package as of September 30, 2018, furnished to shareholders on Form 8-K, and is available on our website at www.mreic.reit.

2

Select Properties

Kansas City MSA Lexington MSA Phoenix MSA

3

Indianapolis MSA Oklahoma City MSA

Company Overview

Memphis MSA Indianapolis MSA

▪ Single tenant, net-leased Industrial REIT specializing in well-located, modern properties subject to long-term leases primarily to investment grade tenants or their subsidiaries ▪ Property portfolio contains 21.6 million square feet, consisting of 113 properties with 98.9% occupancy ▪ Geographically diversified portfolio across 30 states with a focus on major seaports, major intermodal ports, and major airports ▪ Quality roster of investment grade tenants ▪ 80% of rental revenue from investment grade tenants or their subsidiaries, including Amazon, Anheuser Busch, Beam Suntory, Coca-Cola, FedEx, Home Depot, International Paper, National Oilwell, Shaw Industries, Sherwin-Williams, Siemens, United Technologies and other high-quality companies ▪ Strong recent growth ▪ Monmouth successfully grew GLA by approximately 100% during the past five years ▪ In fiscal 2018, closed on seven properties with approximately 2.7 million square feet for $282.3 million ▪ Thus far in fiscal 2019, closed on two properties totaling approximately 474,000 square feet for $113.1 million ▪ Current acquisition pipeline includes one property containing approximately 269,000 square with a total purchase price of $40.9 million ▪ Conservative capital structure ▪ 34.9% Net Debt to Total Market Capitalization ▪ 7.1x Net Debt/Adjusted EBITDA ▪ 2.4x Fixed Charge Coverage ▪ 11.7 years Weighted Average Debt Maturity

Source: MNR 10-K and subsequent press releases

4

Portfolio Overview

▪ 113 properties geographically diversified across 30 states, totaling approximately 21.6 million square feet of GLA ▪ Highest occupancy rate in the Industrial REIT sector at 98.9% ▪ Currently in our fourth consecutive year of above 98% occupancy ▪ Most modern industrial property portfolio ▪ Youngest weighted average building age in the Industrial REIT sector at 8.6 years ▪ Average building size is approximately 192,000 square feet ▪ Weighted average lease maturity is 8.0 years ▪ Weighted average rent per square foot is $6.22 ▪ Simple business model ▪ No off-balance sheet joint ventures ▪ No in-house development division ▪ No significant non-income producing land

96.0% 95.9% 97.7% 99.6% 99.3% 99.6% 98.9% 90.0% 91.0% 92.0% 93.0% 94.0% 95.0% 96.0% 97.0% 98.0% 99.0% 100.0% FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Current

Occupancy

100.0% 86.0% 93.0% 53.0% 100.0% 100.0% 92.0% 69.0%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0% FY 2011 FY 2012 FY 2013 FY 2014* FY 2015 FY 2016 FY 2017 FY 2018**

Tenant Retention

5

Charlotte MSA

Consistent Results

* Only 438,000 square feet, representing 4% of total GLA, came due in fiscal 2014. 60,400 sf of the 208,400 sf that did not renew was re-tenanted. ** Three buildings containing 184,000 total square feet, or 12% of the expiring square footage were sold and one building containing 218,000 square feet, or 14% of the expiring square footage was re-tenanted. Source: MNR 10-K and subsequent press releases

Portfolio Growth

6

9.6 11.2 13.9 16.0 18.8 21.2 21.8 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0 22.0 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E

Total Square Feet (in Millions)

Total GLA Total Real Estate Assets

$0.628 $0.744 $0.941 $1.171 $1.432 $1.720 $1.834 $0.4 $0.6 $0.8 $1.0 $1.2 $1.4 $1.6 $1.8 $2.0 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E

Total Real Estate Assets ($ in Billions)

Source: MNR 10-K and subsequent press releases

Capital Structure

$0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Total Market Capitalization ($ in Billions) Common Equity Preferred Equity Debt

7

Source: MNR 10-K and subsequent press releases

Financial Highlights

Source: MNR 10-K and subsequent press releases

Gross Revenue Adjusted Funds from Operations per Share

$10 $30 $50 $70 $90 $110 $130 $150 $170 2014 2015 2016 2017 2018

+ 27% + 19%

$0.00 $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 $0.90 2014 2015 2016 2017 2018

8

$ in Millions

+ 19% + 9% + 10% + 14% + 23%

▪ Gross Revenue has grown at an average annual rate of 22% over the past five years ▪ AFFO per share has grown at an average annual rate of 14% over the past five years

+ 23%

Ecommerce Trends and MNR’s Portfolio

Source: U.S. Census Bureau

▪ The entire retail industry continues to shift its focus from traditional brick and mortar stores to ecommerce platforms which has led to significant demand for large, modern industrial distribution centers ▪ U.S. ecommerce sales are expected to increase to over $525 billion in 2018 ▪ Excluding food, fuel, and auto, ecommerce represents approximately 16% of total U.S. retail sales ▪ Monmouth was early in anticipating consumer spending’s shift from traditional stores to internet sales ▪ Today, Monmouth’s vast FedEx holdings represent an integral part of the ecommerce ecosystem

ECommerce Sales

$- $100 $200 $300 $400 $500 $600 2011 2012 2013 2014 2015 2016 2017 2018E $ in Billions CAGR: 16.0% 9

Global Retail Sales

0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 5 10 15 20 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018E Online Sales (LHS) In-Store Sales (LHS) % Online (RHS) $ in Trillions

Source: Goldman Sachs

▪ Global consumer habits continue to change resulting in ever greater market share taking place online ▪ Global ecommerce sales are expected to rise to $2.4 trillion this year

10

Source: K.C. Conway, Director of Research, Chief Economist, Alabama Center for Real Estate

11

• Q. What is it about the

“Golden Triangle” that makes it tops in GDP, Logistics & Supply-Chain?

• A. Best “Freightways!”

MREIC’s Portfolio: 87 of 113 properties are located within the “Golden Triangle” The Golden Mfg & Logistics Triangle: SE (#1 @ 22%) + SW + Great lakes = 47% US GDP

The “Golden Triangle” – It’s “All about Logistics!”

Remaking the Supply-Chain – A GREAT story for Mid-Central & SE U.S. The GDP Golden Triangle

Portfolio Markets & Panama Canal Expansion

Source: MNR 10-K, subsequent press releases, Parsons Brinckerhoff Panama Canal Expansion Study, June 2012; Panama Canal Authority, Canal Expansion Programs – Components Report April 2012, Washington Post: “Modernization of the Panama Canal”; January 2013

▪ Monmouth’s acquisition pipeline currently comprises one new build-to-suit industrial property containing approximately 269,000 square feet, which is leased to FedEx Ground, with a purchase price of $40.9 million

▪ Over 70% of the U.S. population lives east of the Mississippi River ▪ Following nine years of construction costing $5.4 billion, the Panama Canal expansion project opened on June 26, 2016 ▪ North American ports have been spending billions of dollars in order to prepare for these larger ships ▪ These ships have more than twice the cargo capacity of the older ships ▪ The expanded Panama Canal allows larger vessels an approximate 29 day shorter transit time from the Atlantic to the Pacific oceans ▪ Container traffic has been rapidly shifting to the East Coast ports

12

Eastern Coastal East Coast Inland Gulf coast & Mississippi valley Non-impacted markets Existing Properties Acquisitions Under Contract

Source: K.C. Conway, Director of Research, Chief Economist, Alabama Center for Real Estate

13 https://www.logisticsmgmt.com/article/u.s._ports_ update_part_1_expanded_panama_canal_chang es_the_balance

According to its latest throughput figures, the Panama Canal transited a total of 13,548 vessels during its fiscal year 2017, representing a 3.3% increase compared to totals the year before. Thanks to the larger Neopanamax vessels now able to transit the expanded Canal, the growth in traffic translated into a 22.2% increase in total annual tonnage from 2016, and helped the Panama Canal surpass the already ambitious cargo projection of reaching 399 million tons. “These record figures reflect not only the industry’s confidence in the expanded Canal, but also illustrate our continued ability to transform the global economy and revitalize the maritime industry,” says Jorge Quijano, Panama Canal administrator.

Following the close of its September 30, 2017 fiscal year, Panama canal authorities announced that the entrepot welcomed a record 403.8 million tons – the largest amount of annual volume ever transited in its 103-year history. Industry analysts say the impact on U.S. ocean cargo gateways will soon become evident.

The Panama Canal currently serves 29 major liner services, including 15 Neopanamax liner services, primarily on the U.S. East Coast to Asia trade

• route. Chris Rogers, an analyst with the global trade consultancy Panjiva,

notes that the diversion of Asian-inbound traffic from U.S. West Coast ports to those on the East Coast “took a step forward” with Panama Canal expansion. Data shows shipments to Southeast ports increased by 26.9 % over FY 2016, while those to California increased by a more modest 7.7 % (Source: Chris Rogers with Panjiva).

Expanded Panama Canal Changes the Balance

Source: K.C. Conway, Director of Research, Chief Economist, Alabama Center for Real Estate

14

SE – MidAtlantic Ports growing 3X-4X West coast Ports

SE & VA TEU Growth is Unmatched

SC had 45% TEU Container Growth 2011-2016

High Quality Tenant Base

▪ 80% of rental revenue is from investment grade tenants or subsidiaries ▪ Higher investment grade tenant base than any other REIT ▪ Rental roster includes Amazon, Anheuser Busch, Beam Suntory, Coca-Cola, FedEx, Home Depot, International Paper, Keurig Dr Pepper, Milwaukee Tool, National Oilwell, Shaw Industries, Sherwin Williams, Siemens, Snap-on, ULTA, United Technologies and other high quality companies ▪ Monmouth began investing in properties leased to FedEx in 1994 ▪ Recent acquisitions include five properties consisting of an additional 1.2 million square feet leased to FedEx ▪ Fifteen FedEx expansion projects completed since Fiscal 2014, increasing the rent and lease terms of these facilities

Largest Percentage of Investment Grade Tenants in the REIT Sector

15

Source: MNR 10-K and subsequent press releases

FedEx Ground, 41.2% FedEx Express, 7.1% Milwaukee Tool, 4.0% Shaw Industries, 3.8% ULTA, 3.1% Amazon.com Services, 3.1% Jim Beam Brands, 2.8% International Paper, 2.7% TreeHouse, 2.6% Remaining Tenants, 29.6% FedEx Ground, 53.6% FedEx Express, 6.0% Amazon.com Services, 2.9% Shaw Industries, 2.6% Milwaukee Tool, 2.3% ULTA, 2.0% International Paper, 1.9% TreeHouse, 1.7%

• B. Braun Medical,

1.6% Jim Beam Brands, 1.5% Remaining Tenants, 23.9%

High Quality Tenants

Square Footage by Tenant Annual Rent by Tenant

16

Source: MNR 10-K and subsequent press releases

FDX and its subsidiaries represent 59.6% of Annual Rent FDX and its subsidiaries represent 48.3% of Square Footage

Florida, 10.2% Texas, 8.2% Georgia, 7.6% Ohio, 7.2% Kentucky, 6.0% South Carolina, 5.9% Mississippi, 5.4% Indiana, 4.6% Illinois, 4.4% North Carolina, 4.3% Remaining States, 36.2% Florida, 11.7% Texas, 10.3% Georgia, 7.8% South Carolina, 7.1% Ohio, 6.7% New Jersey, 5.0% Illinois, 4.6% North Carolina, 4.2% Michigan, 4.2% Kentucky, 3.8% Remaining States, 34.6%

Geographic Focus

Annual Rent by State Square Footage by State

17

▪ Our 21.6 million square foot portfolio is well diversified across 30 states

Source: MNR 10-K and subsequent press releases

Summary Portfolio Metrics

Source: SNL Financial (1) Occupancy for MNR and peers based on SEC reports available as of 12/31/18. (2) On a per square foot weighted average basis, MNR’s portfolio is 8.6 years old. This chart uses simple average instead of weighted average for comparative purposes because some of our peers do not publish weighted average.

18

Current Occupancy (1) Rate Average Building Age (in Years) (2) Rent Roll (% next 3 years by base revenues)

98.9% 98.5% 97.6% 97.1% 96.9% 96.9% 95.4% 94.0%

90.0% 92.0% 94.0% 96.0% 98.0% 100.0% MNR TRNO FR EGP DRE PLD STAG PSB

11.8% 30.5% 42.2% 44.4% 44.5% 46.8% 51.7% 52.1%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% MNR DRE TRNO PLD STAG FR EGP PSB

13 15 19 19 31 31 32

• 10

20 30 40 MNR DRE EGP PLD FR STAG TRNO

▪ Highest

• ccupancy rate

in the sector ▪ Youngest portfolio among peers ▪ Limited near term rent roll

Fiscal 2018 Acquisitions

▪ Monmouth has completed over $1 billion in acquisitions and more than doubled portfolio GLA over the past five years ▪ In fiscal 2018, Monmouth acquired seven industrial properties, of which 85% are net leased to investment grade tenants or their subsidiaries for approximately $282.3 million, containing approximately 2.7 million square feet ▪ Thus far in fiscal 2019, Monmouth acquired two properties containing approximately 474,000 square feet for $113.1 million ▪ Monmouth’s acquisition pipeline currently contains approximately 269,000 square feet, consisting of a new build-to-suit property, which is leased to FedEx Ground with a purchase price of $40.9 million

Fiscal 2018 Acquisitions

Subsequent to FY2018

Charleston, SC Oklahoma City, OK Savannah, GA Daytona Beach, FL Mobile, AL Charleston, SC Atlanta, GA Trenton, NJ Savannah, GA Tenant: Credit Rating: (S&P/Moody’s) BBB/Baa2 AA-/Baa1 AA/Aa2 NR AA-/Baa1 BBB/Baa2 BBB/Baa2 BBB/Baa2 BBB/Baa2 Year Built: 2017 2017 2018 2018 2018 2018 2018 2017 2018 Size (sf): 121,683 300,000 831,764 399,440 362,942 265,318 373,750 347,145 126,520 Acres: 16.2 123.0 62.4 27.5 31.3 48.9 92.6 62.0 29.4 Purchase Price: $21,872,170 $30,250,000 $57,483,636 $30,750,540 $33,688,276 $47,174,296 $61,113,264 $85,248,352 $27,832,780 Price/SF: $179.75 $100.83 $69.11 $76.98 $92.82 $177.80 $163.51 $245.57 $219.99 Lease Maturity: 8/31/2032 10/31/2027 9/30/2027 4/1/2028 11/30/2028 6/30/2033 2/28/2033 6/30/2032 10/31/2028 Annualized Rental Revenue: $1,315,000 $1,884,000 $3,551,000 $2,130,000 $2,020,000 $2,713,000 $3,801,000 $5,328,000 $1,755,000

19

Source: MNR 10-K and subsequent press releases

Select Recent Acquisitions

FedEx Ground – Orlando, FL MSA – 310,922 sf

20

Source: MNR 10-K and subsequent press releases

Walmart has recently constructed two large ecommerce fulfillment centers (one on each side of our FedEx facility) totaling 2.35 million square feet, illustrating the strong demand for our locations.

The Changing of The Guard

Before

21

Source: MNR

▪ The Big Town Mall was for many years the largest mall in Texas, and today…

The Changing of The Guard

After

22

Source: MNR

▪ This large 65 acre parcel situated six miles east of downtown Dallas is now the site of Monmouth’s new 352,000 sf FedEx facility.

Select Recent Acquisitions (continued)

ULTA Ecommerce Fulfillment Center

Indianapolis, IN MSA – 671,354 sf

23

Source: MNR 10-K and subsequent press releases

GE CATA

(Center for Additive Technology Advancement)

Pittsburgh, PA MSA – 125,860 sf

Acquisition Pipeline

▪ Our acquisition pipeline consists of one property comprising approximately 269,000 square feet with a purchase price of $40.9 million ▪ Lease commences in the first half of fiscal 2020 ▪ Acquisition included in the pipeline has a lease maturity of 15 years ▪ Monmouth actively looks for new built-to-suit opportunities near already owned FedEx facilities ▪ Six FedEx expansion projects completed within the last two years with a total cost of $12.4 million as well as a 250,000 sf expansion for Milwaukee Tool at a total cost of $9.8 million ▪ These expansions resulted in extending the weighted average lease terms by approximately 11 years and produced approximately 10% returns on cost from increased rents ▪ Monmouth maintains excellent relationships with top merchant builders 24

Built-to-Suit Built-to-Suit Built-to-Suit Infrastructure Installation

Source: MNR 10-K and subsequent press releases

Lease Expirations Are Well Dispersed

▪ Minimal rent roll down risk observed on lease renewals ▪ Weighted average lease maturity currently at 8.0 years ▪ Weighted average rent per occupied square foot of $6.22 ▪ National average rent psf for industrial real estate currently is $6.11 and trending higher ▪ Monmouth historically averages approximately 90% annual tenant retention: 100% renewed in Fiscal 2015 and 2016, 92% renewed in Fiscal 2017, and 69% in Fiscal 2018

0 sq. ft. 500 sq. ft. 1,000 sq. ft. 1,500 sq. ft. 2,000 sq. ft. 2,500 sq. ft. 3,000 sq. ft. 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034

$10.15 $5.54 $5.59 $4.57 $5.68 $5.71 $6.35 $5.13 $3.98 $8.08 $5.40 $8.92

Fiscal Year

GLA 2.4% 1.8% 5.6% 5.3% 7.7% 7.3% 11.1% 4.5% 10.6% 11.9% 6.0% 4.8% 4.4% 9.6% 3.0% 2.6% ABR 2.2% 1.6% 4.1% 4.8% 7.1% 7.5% 9.2% 5.9% 9.4% 10.3% 5.4% 5.5% 5.3% 13.8% 4.8% 1.7%

Expiring Square Footage (000’s)

25

Expiring square footage (‘000’s) Average rent per occupied square foot of expiring square footage above each bar

$5.57 $5.47 $7.41 $7.10

(1) In fiscal 2019, approximately 1.5 million square feet was originally set to expire, out of which 802,595 square feet has thus far been renewed. This bar represents the 681,395 square feet still remaining to be renewed. Source: MNR 10-K and subsequent press releases, GLA: Gross Leasable Area, ABR: Annual Base Rent

Favorable US Industrial Fundamentals

Source: CBRE Research & Green Street

▪ Current economic indicators are very favorable for the US industrial real estate sector and Monmouth’s portfolio due to: ▪ Rising GDP ▪ Rampant growth in ecommerce ▪ Limited new construction over the past 8 years ▪ Manufacturing growth due to increased domestic energy production ▪ Continued benefits from the recently completed Panama Canal expansion

US Industrial Construction (000’s) US Industrial Occupancy

100,000 200,000 300,000 400,000 2004 2006 2008 2010 2012 2014 2016 2018 85% 90% 95% 100% 2004 2006 2008 2010 2012 2014 2016 2018

95.6% 267,000

26

US Cap Rates

4% 6% 8% 10% 2004 2006 2008 2010 2012 2014 2016 2018

5.0%

Securities Portfolio Historic Performance (Fiscal Year)

(1) Fiscal Year beginning balance (2) Fiscal Year end balance Source: MNR 10-K and subsequent press releases .

Dividend Income ($ in Millions) Net Realized Gains ($ in Millions)

27

$5.4 $8.5 $12.4 $16.2 $19.9 $25.6 $32.5 $45.6

$2.4 $3.0 $3.1 $3.9 $3.9 $3.7 $5.6 $6.9 $13.1

$0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $50 2010 2011 2012 2013 2014 2015 2016 2017 2018 $7.8 $13.9 $21.0 $23.2 $24.0 $28.4 $30.7 $30.8

$2.6 $5.2 $6.0 $7.1 $2.2 $0.8 $4.4 $2.3 $0.1

$0 $5 $10 $15 $20 $25 $30 $35 2010 2011 2012 2013 2014 2015 2016 2017 2018

Annual Amount Cumulative Amount since 2010 Annual Amount Cumulative Amount since 2010 Fiscal Year Securities Portfolio Cost (1) Securities Available for Sale (1) Dividend Income Net Realized Gain on Sale

• f Securities

Change in Unrealized Gain/(Loss)(2) Total Return Total Return % 2010 $24,027,834 $27,824,665 $2,387,757 $2,609,149 $6,319,226 $11,316,132 47.10 2011 32,401,668 42,517,725 2,981,534 5,238,203 (7,747,894) 471,843 1.46 2012 41,896,896 44,265,059 3,144,837 6,044,065 3,015,774 12,204,676 29.13 2013 56,301,236 61,685,173 3,861,374 7,133,252 (3,394,669) 7,599,957 13.50 2014 43,462,472 45,451,740 3,863,136 2,166,766 (1,867,912) 4,161,990 9.58 2015 59,190,047 59,311,403 3,707,498 805,513 (5,562,959) (1,049,948)

• 1.77

2016 59,982,840 54,541,237 5,607,403 4,398,599 18,383,870 28,389,872 47.33 2017 60,662,627 73,604,894 6,919,973 2,311,714 (6,371,702) 2,859,985 4.71 2018 117,194,205 123,764,770 13,099,316 111,387 (31,315,144) (18,104,441)

• 15.45

Total $45,572,828 $30,818,648 $(28,541,410) $47,850,066

• Avg. 15.07%

Securities Portfolio Historic Performance (continued)

Source: MNR 10-K, subsequent press releases and SNL Financial as of 9/30/18 .

28

MREIC REIT Portfolio (%) FISCAL YEAR MSCI REIT Index (RMS)(%) S&P 500 Index (%) MREIC vs. MSCI REIT Index (RMS) Outperformance in BPS ∆ MREIC vs. S&P 500 Index Outperformance in BPS ∆ 2010 47.10 30.54 10.16 1656 3694 2011 1.46 1.26 1.14 20 32 2012 29.13 32.44 30.20

• 331
• 107

2013 13.50 6.63 21.59 687

• 809

2014 9.58 13.26 19.73

• 368
• 1015

2015

• 1.77

9.47

• 0.61
• 1124
• 116

2016 47.33 19.83 15.43 2750 3190 2017 4.71 0.54 18.61 417

• 1390

2018

• 15.45

4.78 15.22

• 2023
• 3067

Average 15.07 13.19 14.61 187 46

20 40 60 80 100 120 140 160 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 MREIC RMS S&P 500

135.6% 131.5%

Total Return

118.8%

Conservative Balance Sheet

▪ Conservative capital structure ▪ 34.9% Net Debt to total market capitalization ▪ 7.1x Net Debt/Adjusted EBITDA ▪ 2.4x fixed charge coverage ▪ 79% fixed rate debt, weighted average interest rate of 4.1% ▪ Limited debt maturities each year through 2023 ▪ 79% of debt consists of modest LTV asset level mortgage financing ▪ Weighted average mortgage maturity of 11.7 years, representing one of the longest debt maturity schedules in the REIT sector ▪ $354.2 million in potential liquidity ▪ $154.9 million in REIT marketable securities ▪ $90.0 million available on our $200 million unsecured revolving line of credit, plus an additional $100 million potentially available on an accordion feature ▪ $9.3 million in cash ▪ Subsequent to fiscal yearend, completed our first Common Stock

• ffering since 2014, with the sale of 9.2 million shares generating gross

proceeds of $138 million

Source: MNR 10-K and subsequent press releases (1) All dollar amounts except stock price are in millions

Debt Maturities Total Market Capitalization (1)

Equity, 54% Debt, 35% Preferred, 11%

Total Shares Outstanding (9/30/18) 81,503,134 Stock Price (9/30/18) $16.72 Equity Market Capitalization $1,362.7 Mortgage Notes Payable 711.5 Loans Payable 186.6 Total Debt $898.1 Total Preferred 287.2 Total Market Capitalization $2,548.1

29

$0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 2019 2020 2021 2022 2023 Thereafter

7.9% 5.5% 23.0% 48.4% 9.6% 5.6%

Total Debt ($ in Millions)

Dallas MSA

Loans Payable Mortgages

% of Total Debt Outstanding

Long Term Cash Dividend

Source: SNL Financial

▪ Monmouth has maintained or increased its dividend for 27 consecutive years ▪ On October 2, 2017, Monmouth increased its dividend by 6.25% to $0.68 per year, marking our second dividend increase in 3 years. These 2 dividend increases total 13% ▪ Current AFFO dividend payout ratio is a conservative 77% ▪ Monmouth was one of the only REITs that maintained its dividend throughout the Great Recession ▪ 100% cash dividends since inception

$0.57 $0.58 $0.58 $0.58 $0.58 $0.58 $0.58 $0.60 $0.60 $0.60 $0.60 $0.60 $0.60 $0.60 $0.60 $0.60 $0.60 $0.64 $0.64 $0.68 $0.68

$0.50 $0.52 $0.54 $0.56 $0.58 $0.60 $0.62 $0.64 $0.66 $0.68 $0.70

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019E

Dividends Per Share

30

Peer Analysis

Source: SNL Financial as of 12/31/18 NOTE: MNR peers include DRE, EGP, FR, PLD, PSB, STAG and TRNO

Dividend Yield 2018E FFO Multiple 2018E FFO Payout Ratio Total Debt/Total Market Capitalization

31

26.7x 20.4x 19.6x 19.4x 19.4x 17.6x 13.9x 13.1x

0.0x 5.0x 10.0x 15.0x 20.0x 25.0x 30.0x TRNO PSB EGP PLD DRE FR STAG MNR

35.25% 28.8% 26.5% 25.0% 19.8% 19.8% 19.2% 2.4%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% MNR STAG EGP FR DRE PLD TRNO PSB

5.9% 5.7% 3.4% 3.4% 3.3% 3.3% 3.1% 2.8%

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% STAG MNR DRE PLD PSB EGP FR TRNO

79.4% 72.9% 71.7% 65.3% 64.4% 63.6% 61.7% 54.7%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% STAG TRNO MNR PSB DRE PLD EGP FR

Total Return Performance

Source: SNL Financial as of 12/31/18

12Year

• 150
• 100
• 50

50 100 150 200 250 300 350 400

12/31/2006 4/30/2007 8/31/2007 12/31/2007 4/30/2008 8/31/2008 12/31/2008 4/30/2009 8/31/2009 12/31/2009 4/30/2010 8/31/2010 12/31/2010 4/30/2011 8/31/2011 12/31/2011 4/30/2012 8/31/2012 12/31/2012 4/30/2013 8/31/2013 12/31/2013 4/30/2014 8/31/2014 12/31/2014 4/30/2015 8/31/2015 12/31/2015 4/30/2016 8/31/2016 12/31/2016 4/30/2017 8/31/2017 12/31/2017 4/30/2018 8/31/2018 12/31/2018

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Dividend Yield

5.9% 5.7% 3.4% 3.4% 3.3% 3.3% 3.1% 2.8%

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% STAG MNR DRE PLD PSB EGP FR TRNO

MNR Peer Group RMS

217.11% 49.86% 62.77%

▪ Monmouth is one of the top performing REITs over a 2, 10 and 20 year period ▪ Slide utilizes 12 year period to illustrate long term performance including during the Global Financial Crisis

Key Investment Highlights

Best-in-Class Single Tenant Net-Lease Industrial Portfolio

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Geographically Diversified with a High Quality Tenant Base Demonstrated Portfolio, Earnings, and Dividend Growth Conservative Balance Sheet Experienced & Aligned Management Team with 6% Ownership Well Positioned for Future Growth

Monmouth Real Estate Investment Corporation www.MREIC.reit