Locatjon is Everything. Strategy + Executjon = Results CONFIDENTIAL
Nearly 50 years of experience in retail investment Transactjon history that includes over 400 assets totaling $4.0 billion Over 60 dedicated retail real estate professionals Experience, Low-leverage, fmexible balance sheet Expertjse, Strong local market expertjse in CA, AZ, TX, and Vision CO, IL, NC, GA Key relatjonships with Kroger, Albertsons, Publix , and Sprouts Board of Directors consistjng of three independents and six total members 2
Path to Instjtutjonalizatjon 1970-2015 Syndicatjon Years Westwood Financial founded by Steven Fogel and Howard Banchik Acquired 69 assets via syndicatjon in Los Angeles, primarily apartment buildings Transitjoned from apartment buildings to unanchored retail centers Grew syndicatjon model to over 100 retail assets and approximately $1.7 billion in AUM 2016-2020 Instjtutjonalized, Post Roll-Up Years Completed Consolidatjon Transactjon on September 1, 2016 with the roll up of 550 limited partnerships into a limited liability company Established Board of Directors Extended debt duratjon to over six years by transitjoning balance sheet lenders from local banks and CMBS to banks and life insurance lenders Purchased approximately $200 million of real estate including high-profjle assets such as Lake Houston (H-E-B), Arbors at Mallard Creek (Trader Joe’s), Decatur Crossing (Sprouts), and Kingsbury Center (Lincoln Park, IL) Hired Matu Lougee as EVP, Finance and David Malayil as EVP, Leasing Transitjoned Co-CEO structure with single CEO role; Mark Bratu, formerly CIO of DDR Corp. and Sr. Managing Director at CBRE, and lead-independent board director of Westwood Financial since 2016, was named CEO on January 1, 2019 Closed on an inaugural, syndicated, revolving credit facility with $95 million of capacity priced at Libor + 185 basis points Acquired two unanchored shopping centers, located in Phoenix, AZ and Chicago, IL, for $17.8 million at an average cap rate of 6.8% Executed inaugural tender ofger; 57 investors tendered at 25% discount to NAV for a total of approximately $16.5M; achieved 8.0% NAV/share accretjon Increased same store EBITDA by 5.5% in 2019 4 3
PLATFORM AND PORTFOLIO OVERVIEW (PRE-COVID) Employee Count 57 Rent PSF: Total $19.22 Centers: Owned 73 Rent PSF: <10,000 SF $27.70 Centers: Third Party Managed 39 Leased Rate 93.6% Tenant Count (1) 1,530 Renewal Leasing Spreads (2) 6.9% Square Feet (1) 9.6 million Populatjon (3 mile) 102,000 Gross Asset Value Fund $1.4 billion HH Income (3 mile) $97,000 Grocery Sales PSF/Occupancy Cost $556/2.5% Fund Leverage 50% % of NOI – Top 30 MSA’s 83% Interest Rate (Wtd. Avg.) 4.2% Offjces Los Angeles (HQ) Top Lenders KeyBank; PPM; Phoenix; Dallas; Atlanta; Natjonwide; Unum (1) Includes owned, adjacent and managed (2) 2019; excludes anchors 4
I. Westwood Portgolio
I. WESTWOOD PORTFOLIO STRATEGICALLY POSITIONED IN GROWTH MARKETS... Chicago MSA (3) Raleigh MSA (42) 9.4M Populatjon 1.4M Populatjon Denver MSA (19) 2.9M Populatjon Charlotue MSA (23) IL 2.6M Populatjon Los Angeles MSA (2) 13.3M Populatjon CO CA NC Dallas MSA (4) 7.5M Populatjon AZ GA Atlanta MSA (10) 5.9M Populatjon Phoenix MSA (11) 4.9M Populatjon TX FL Houston MSA (5) 7M Populatjon Offjces MSA demographics based on fjve year average estjmates from 2019-2023 Source: ESRI; Green Street Atlas Target States 6
I. WESTWOOD PORTFOLIO …WITH SUPERIOR DEMOGRAPHICS... REIT Peers Rent 3 Mile 3 Mile Tap PSF Household Income Populatjon Score Brixmor $13.89 $72,000 86,000 56 Kimco $16.08 $84,000 124,000 70 Kite (1) $17.37 - - - Regency $21.59 $94,000 146,000 80 Retail Opportunity Investments $20.12 $92,000 118,000 73 Retail Propertjes of America $19.36 $87,000 145,000 69 RPT Realty (1) $15.40 $79,000 100,000 - Site $17.47 $83,000 110,000 71 Weingarten $19.17 $76,000 122,000 70 REIT Average $17.83 $83,000 119,000 70 Westwood Financial $19.22 $97,000 102,000 75 (1) Tap Score and/or demographics unavailable 7
I. WESTWOOD PORTFOLIO ...FOCUSED ON ESSENTIAL TENANTS... 70% 64% 60% 50% % of NOI 40% 30% 24% 20% 12% 10% 0% Grocery-Anchored Grocery-Anchored Unanchored Strip/ (owned) (unowned) Urban Retail (38) (18) (16) 8
I. WESTWOOD PORTFOLIO ...THAT ARE INTERNET-RESISTANT... Tenant Concentratjons Portgolio Compositjon by SF SF % Total Base % Total Rank Tenant Stores (in 000’s) SF Rent Rent (in 000’s) 1 Kroger 14 643 13.6% $5,467 6.1% 2 Albertsons / Safeway 10 442 9.4% $4,608 5.1% F&B and Food, Beverages, Grocery Grocery Services & Services 3 Publix 5 266 5.7% $2,854 3.2% 43% 43% 38% 38% d 4 Sprouts 4 127 2.7% $1,848 2.1% Grocery 5 Petsmart 3 63 1.4% $1,475 1.6% 6 Hy-Vee 2 130 2.8% $1,204 1.3% Other 7 H-E-B 1 80 1.7% $1,165 1.3% (1) 8 Bed Bath & Beyond 2 44 0.9% $943 1.1% 19% 9 LA Fitness 1 45 1.0% $941 1.0% 10 Subway 21 28 0.6% $870 1.0% 63 1,873 39.7% $21,375 23.8% (1) Includes: Child/Baby, Home Furnishing, Offjce Supplies, Pet Stores, Others 9
I. WESTWOOD PORTFOLIO ...AND COMMAND A PREMIUM RELATIVE VALUATION Strip Center Nominal Cap Rates Cap Rates Neighborhood Center NOI Concentratjon 7.3% 87% 6.8% 6.6% 6.6% 6.5% 6.3% 6.3% 5.7% 5.5% 52% 35% 21% 17% 17% 12% 10% 6% BRX SITC KRG RPAI WRI UE WF REG ROIC Source: Green Street Advisors for peers; WF is based on third party BOVs 10
II. Westwood Platgorm
II. WESTWOOD PLATFORM WESTWOOD IS THE INDUSTRY LEADER IN MANAGING SMALL SHOP TENANTS... % of Small Shop Square Footage 60% Generates the highest SSNOI and lowest capex 50% 40% 30% 20% 10% 0% WF ROIC AKR REG WRI RPAI KRG FRT BRX RPT KIM SITC 12
II. WESTWOOD PLATFORM ...REPRESENTED BY BEST IN CLASS COLLECTIONS... Rent Collectjons Cash - Within Month Cash - Afuer Month End Deferrals 100% 7% 90% 13% 7% 5% 80% 21% 13% 70% 60% 50% 79% 40% 69% 70% 30% 20% 10% 0% April May June 13 As of July 19, 2020
II. WESTWOOD PLATFORM ...WITH A GROCERY AND SERVICE-ORIENTED PORTFOLIO... Collectjons by Category (2Q20) 100% 90% 80% 70% % of Base Rent Collected 60% 50% 40% 30% 20% 10% 0% Grocery Conven. Financial Specialty Medical General F & B Beauty Apparel Health & Drug % of Total 23% 2% 5% 14% 6% 9% 24% 9% 4% 4% 14 Note: “Specialty” includes pet stores, smoke shops, telecommunicatjon, etc. “General” includes dry cleaning, massage/spa, tailoring, etc.
II. WESTWOOD PLATFORM ...AND BEST IN CLASS SHOP LEASING RESULTS... Change in Small Shop Leased Rate 1Q19 - 1Q20 (in basis points) 450 400 350 300 250 200 150 100 50 (50) (100) (150) WF (1) WRI REG AKR KRG SITC BRX RPAI FRT (1) Grey bar represents 39 managed propertjes, which experienced an increase of 414 basis points from 1Q19 to 1Q20 15
II. WESTWOOD PLATFORM ...WHILE PRODUCING THE HIGHEST ROI ON NEW LEASING FY2019 New Lease Payback Period (Years) 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 REG WF BRX KIM RPT RPAI SITC WRI KRG 16
IV. Appendix
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