Q2 – 2018 Investor Presentation
Forward–Looking Statements This presentation contains "forward-looking information" as defined under Canadian securities laws which reflect management’s expectations regarding objectives, plans, goals, strategies, future growth, results of operations, performance, business prospects and opportunities of WPT Industrial Real Estate Investment Trust (the “REIT"), including statements concerning the Transaction (as defined herein) providing access to additional capital resources and enhanced and diversified cash flows, achievement of the targeted US$1.0 B in equity for the venture with Canada Pension Plan Investment Board and Alberta Investment Management Corporation (the “Venture”), achievement of increased property acquisition through the Venture pipeline, expected private capital management and incentive fees, expected availability of WPT Capital Advisors, LLC-managed properties for acquisition and the length of employment for the internalized employees. The words “plans”, “expects”, “scheduled”, “estimates”, “intends”, “anticipates”, “projects”, “believes”, or variations of such words and phrases (including negative variations) or statements to the effect that certain actions, events or results “may”, “will”, “could”, “would”, “might”, “be achieved”, or “continue” and similar expressions identify forward-looking statements. These statements reflect the REIT's current expectations regarding future events and operating performance, the REIT’s future growth potential and other prospects and opportunities, results of operations, demographic and industry trends and future legislative and regulatory approaches with respect to matters affecting the REIT and speak only as of the date of this presentation. Forward looking statements are necessarily based on a number of estimates, beliefs and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies which could cause actual results to differ materially from those that are disclosed in such forward-looking statements. While considered reasonable by management of the REIT as of the date of this presentation, any of these estimates, beliefs or assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those estimates, beliefs or assumptions could be incorrect. When relying on forward-looking statements to make decisions, the REIT cautions readers not to place undue reliance on these statements, as forward-looking statements involve significant risks and uncertainties and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not the times at or by which such performance or results will be achieved, if achieved at all. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including but not limited to those factors discussed or referenced under the “Risk Factors” section of the REIT’s MD&A and the REIT’s annual information form (the “AIF”) for the year ended December 31, 2017. This presentation does not constitute or form part of any offer for sale or solicitation of any offer to buy or subscribe for any securities nor shall it or any part of it form the basis of or be relied on in connection with, or act as any inducement to enter into, any contract or commitment whatsoever. The information contained in this presentation concerning the REIT and its affiliates does not purport to be all-inclusive or to contain all the information that a prospective purchaser or investor may desire to have in evaluating whether or not to make an investment in the REIT. The information is qualified entirely by reference to the REIT’s MD&A and the AIF. The term debt-to-gross book value (“GBV”) included in this presentation is used by management to measure, compare and explain the operating results and financial performance of the REIT and is not recognized terms under IFRS. Management believes this term is a relevant measures in comparing the REIT’s performance to industry data, the REIT’s ability to earn and distribute cash returns to holders of the REIT’s trust units, and the REIT’s ability to meet its ongoing obligations. This term does not have a standardized meaning prescribed by IFRS and may not be comparable to a similarly titled measure presented by other issuers. 2
Overview WPT Industrial Real Estate Investment Trust is the only Canadian-listed REIT focused exclusively on the U.S. Industrial Sector
U.S. Exposure Through Fully-Integrated Platform Seasoned management team with extensive knowledge of the U.S. industrial sector Unit price and annual distribution of $0.76/unit in U.S. Dollars Access to high-barrier U.S. markets through off-market private capital acquisition pipeline 4
Proven Growth Strategies MAINTAINING CONTRACTUAL OFF-MARKET FEE REVENUE CONSISTENTLY RENT INVESTMENT FROM THIRD- HIGH INCREASES PIPELINE PARTY OCCUPANCY CAPITAL WPT ROLLING EXTENSIVE INTERNAL EXTERNAL MANAGEMENT RENTS TO INDUSTRY GROWTH GROWTH MARKET AT PLATFORM RELATIONSHIPS RENEWAL PROPERTY ENTRY INTO PARTNERSHIPS STRATEGIC EXPANSION NEW U.S. WITH PREMIER FINANCING AND GLOBAL MARKETS INVESTORS DEVELOPMENT 5
AVG. CEILING HEIGHT 2 INVESTMENT PROPERTIES 31’ 55 ……………………………… AVG. BLDG. SIZE (SQ. FT.) 2 ……………………………… 332,000 TOTAL SQUARE FEET OF GLA 18,089,827 ………………………………… AVG. TENANT SIZE (SQ. FT.) 2 ………………………………… 150,000 FAIR VALUE OF INVESTMENT ………………………………………. PROPERTIES AVG. ASSET AGE (YEARS) 2 $1.0B 14 1. As at June 30, 2018 2. Industrial assets only 6
Expanding U.S. Footprint 1 / Washington D.C 1. As at June 30, 2018 7
High-Quality Tenant Base % of Total Annualized GLA Occupied (%) of Total Portfolio Tenant Industry Base Rent 1 (‘000s sq. ft.) 1 GLA 1 General Mills Operations, LLC Consumer Products 5.6% 1,512.6 8.4% Continental Tire the Americas Consumer Products 5.0% 740.9 4.1% Unilever Home & Personal Care Consumer Products 4.9% 1,262.6 7.0% Zulily, LLC E-Commerce 3.7% 737.5 4.1% Keystone Automotive 2 Consumer Products 3.6% 633.6 3.5% Fullbeauty Brands, Inc. E-Commerce 3.0% 741.1 4.1% Radial, Inc. E-Commerce 2.8% 543.5 3.0% CEVA Logistics U.S. Inc. Third Party Logistics 2.8% 648.8 3.6% Amazon.com E-Commerce 2.7% 572.0 3.2% Honeywell International Inc. Consumer Products 2.7% 754.0 4.2% Total 36.8% 8,146.6 45.2% 1. As at June 30, 2018 2. Comprised of two leases with Keystone Automotive Operations, Inc. and Keystone Automotive Industries, Inc.; both wholly-owned subsidiaries of LKQ Corporation. 8
Well-Positioned Balance Sheet 1 2 3.1 years Weighted average mortgage term to maturity 2 3.8% Weighted average effective interest rate 43.4% Total debt to GBV 3.1x Fixed charge coverage ratio 7.1x Debt to adjusted EBITDA $76mm Credit facility availability 1. As at June 30, 2018 2. Excludes the REIT’s credit facility 9
Staggered Debt Maturity 1 Debt Maturities by Year 100.0 90.0 87.7 3.8% 80.0 70.0 73.7 Maturities ($ in Millions) 60.0 Weighted average 50.0 interest rate 53.2 40.0 41.0 30.0 32.1 32.1 26.4 20.0 10.0 - 2018 2019 2020 2021 2022 2023 2024 4.5% 3.4% 3.1% 4.6% 3.8% 3.7% 3.5% Weighted Average Interest Rate of Maturities 1. As at June 30, 2018 and excludes the REIT’s credit facility 10
Staggered Lease Maturity Schedule Lease Expiration (% of GLA) by Year ¹ 3.8 years 19.7% 16.9% Weighted average 16.5% remaining lease term 12.8% 11.9% 11.3% 6.0% 4.9% 2018 2019 2020 2021 2022 2023 2024 2025+ 9 2 20 14 27 23 14 6 13 1. As at June 30, 2018 Number of Leases Expiring 2. Includes one month-to-month lease 11
Upcoming Lease Renewals 1 2018 2 totaling 6.0% of the portfolio expiring in 2018, including: As at 6/30/2017, the REIT had 4 leases totaling 2.1% of the portfolio remaining to be renewed. 9 leases • The Clorox Company: 364,000 sq. ft. • KGP Logistics: 311,100 sq. ft. 2018 2018 • UPS: 300,000 sq. ft. 2019 20 leases totaling 11.9% of the portfolio expiring in 2019, including: • CEVA Logistics U.S. Inc: 648,750 sq. ft. • Amazon.com: 572,000 sq. ft. Significant lease renewals completed as at June 30, 2018 : • Honeywell: 754,000 sq. ft. 3-year renewal with initial base rent increase of 8.0% and annual base rent increases of 2% thereafter • XPO Logistics: 194,660 sq. ft. 3.8-year renewed with initial base rent increase of 10.5% and annual base rent increases of 2% thereafter 1. As at June 30, 2018 12 2. Includes one month-to-month lease
Track Record of Growing Unitholder Value 1 252.5 250 230 210 195.5 190 170 154.0 150 130 129.6 110 90 70 Mar-13 Jun-13 S ep-13 Dec-13 Mar-14 Jun-14 S ep-14 Dec-14 Mar-15 Jun-15 S ep-15 Dec-15 Mar-16 Jun-16 S ep-16 Dec-16 Mar-17 Jun-17 S ep-17 Dec-17 Mar-18 Jun-18 WIR (US $) WIR (CAD$) S &P/ TS X Composite Index (CAD$) S &P/ TS X Capped REIT Index (CAD$) 1. Unit price growth from IPO – June 30, 2018 13
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