Strategy + Executjon = Results CONFIDENTIAL Nearly 50 years of - - PowerPoint PPT Presentation
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
Locatjon is Everything.
CONFIDENTIAL
Low-leverage, fmexible balance sheet Strong local market expertjse in CA, AZ, TX,
Key relatjonships with Kroger, Albertsons,
Board of Directors consistjng of
Nearly 50 years of experience in retail investment Over 60 dedicated retail real estate professionals Transactjon history that includes over 400 assets totaling $4.0 billion
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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
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
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
Increased same store EBITDA by 5.5% in 2019
1970-2015 2016-2020
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Employee Count 57 Centers: Owned 73 Centers: Third Party Managed 39 Tenant Count (1) 1,530 Square Feet (1) 9.6 million Gross Asset Value Fund $1.4 billion Grocery Sales PSF/Occupancy Cost $556/2.5% % of NOI – Top 30 MSA’s 83% Offjces Los Angeles (HQ) Phoenix; Dallas; Atlanta; Rent PSF: Total $19.22 Rent PSF: <10,000 SF $27.70 Leased Rate 93.6% Renewal Leasing Spreads (2) 6.9% Populatjon (3 mile) 102,000 HH Income (3 mile) $97,000 Fund Leverage 50% Interest Rate (Wtd. Avg.) 4.2% Top Lenders KeyBank; PPM; Natjonwide; Unum
(1) Includes owned, adjacent and managed (2) 2019; excludes anchors 4
Offjces Target States
MSA demographics based on fjve year average estjmates from 2019-2023 Source: ESRI; Green Street Atlas
CA AZ TX CO IL FL GA NC
Los Angeles MSA (2) 13.3M Populatjon Phoenix MSA (11) 4.9M Populatjon Houston MSA (5) 7M Populatjon Denver MSA (19) 2.9M Populatjon Chicago MSA (3) 9.4M Populatjon Charlotue MSA (23) 2.6M Populatjon Raleigh MSA (42) 1.4M Populatjon Atlanta MSA (10) 5.9M Populatjon Dallas MSA (4) 7.5M Populatjon
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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
$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
$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
70% 60% 50% 40% 30% 20% 10% 0%
% of NOI
Grocery-Anchored (owned) (38)
64% 24% 12%
Grocery-Anchored (unowned) (18) Unanchored Strip/ Urban Retail (16)
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Tenant Concentratjons
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% 3 Publix 5 266 5.7% $2,854 3.2% 4 Sprouts 4 127 2.7% $1,848 2.1% 5 Petsmart 3 63 1.4% $1,475 1.6% 6 Hy-Vee 2 130 2.8% $1,204 1.3% 7 H-E-B 1 80 1.7% $1,165 1.3% 8 Bed Bath & Beyond 2 44 0.9% $943 1.1% 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%
Portgolio Compositjon by SF
(1) Includes: Child/Baby, Home Furnishing, Offjce Supplies, Pet Stores, Others
Grocery 43% Other 19% F&B and Services 38% d
Food, Beverages, & Services 38%
(1)
Grocery
Grocery 43%
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Strip Center Nominal Cap Rates
Cap Rates Neighborhood Center NOI Concentratjon
BRX SITC KRG RPAI WRI UE WF REG ROIC
7.3% 6.8% 6.6% 6.6% 6.5% 6.3% 6.3% 5.7% 5.5% Source: Green Street Advisors for peers; WF is based on third party BOVs 17% 17% 10% 21% 12% 35% 52% 87% 6%
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% of Small Shop Square Footage
Generates the highest SSNOI and lowest capex
60% 50% 40% 30% 20% 10% 0%
WF ROIC AKR REG WRI RPAI KRG FRT BRX RPT KIM SITC
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April May June
Cash - Within Month Cash - Afuer Month End Deferrals
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
69% 21% 7% 70% 13% 13% 7% 5% 79%
Rent Collectjons
As of July 19, 2020 13
Collectjons by Category (2Q20)
% of Base Rent Collected 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
Grocery Conven. Financial Specialty Medical General F & B Beauty Apparel Health & Drug 23% 2% 5% 14% 6% 9% 24% 9% 4% 4% Note: “Specialty” includes pet stores, smoke shops, telecommunicatjon, etc. “General” includes dry cleaning, massage/spa, tailoring, etc.
% of Total 14
Change in Small Shop Leased Rate 1Q19 - 1Q20 (in basis points)
WF(1) WRI REG AKR KRG SITC BRX RPAI FRT 450 400 350 300 250 200 150 100 50 (50) (100) (150)
(1) Grey bar represents 39 managed propertjes, which experienced an increase of 414 basis points from 1Q19 to 1Q20
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FY2019 New Lease Payback Period (Years)
REG WF BRX KIM RPT RPAI SITC WRI KRG 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0
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Mark Bratu is the Chief Executjve Offjcer of Westwood Financial. Prior to joining Westwood, he served as a Senior Managing Director with CBRE’s Capital Markets and led Retail Investment Services for the Americas. Mark oversaw more than 125 commercial real estate professionals with 25 focused on instjtutjonal clients. Prior to joining CBRE, Mark was Chief Investment Offjcer for SITC (formerly DDR), responsible for acquisitjons and dispositjons. SITC is a publicly traded REIT focused on open air shopping centers with 400 propertjes across the United States. During his tenure, SITC acquired more than $4 billion and sold over $2 billion in retail centers. Prior to SITC, Mark was an Executjve Director with Morgan Stanley Real Estate, providing investment leadership for the fjrm’s opportunity funds and separate account clients. He also worked at Lend Lease and Prentjss Propertjes in acquisitjons, dispositjons, development and asset management. Matu Lougee is the Executjve Vice President of Finance and Accountjng. He oversees all capital markets, investor relatjons, strategic planning and analysis, and accountjng functjons. Prior to joining Westwood in 2017, he spent ten years at public shopping center REIT SITC where he oversaw investor relatjons, asset management, and transactjons. He is a graduate of Colgate University. David Malayil is the Executjve Vice President of Leasing and Legal. He oversees all leasing, lease administratjon, and legal work for the organizatjon, as well as being a member of the Executjve Leasing Commituee for the Fund and its managed assets. Prior to joining Westwood, David was a Vice President of Big Box, Theater and Peripheral Leasing for the Macerich Company for 15
Doug Howell is the Vice President of Asset Management and has been with Westwood Financial for nearly 11 years. Doug manages a team of 14 Property Managers and Assistant Property Managers handling all of the day to day operatjons and management of Westwood’s portgolio. Prior to joining Westwood, Doug was with Cencor Realty Services for nine years. Miki Antunovich is the Vice President of Investor Relatjons, Tax and Accountjng. He has 25 years of progressive experience in real estate with a background encompassing taxatjon with an emphasis on partnerships, $400m+ 1031 exchange structuring, reverse exchanges, 704(b) basis tracking and cost segregatjon studies. Miki has an advanced accountjng background encompassing fjnancial reportjng, consolidatjon, general ledger, fjxed assets, accounts receivable/payable, debt, treasury management, payroll and all areas of audit. He graduated from California State University, Fresno with a BS in Business Administratjon with an emphasis in Accountjng. Bretu Johnston is the Vice President of Operatjons. Bretu received his degree from Denison University and has been with Westwood Financial since 2002. Over the last ten years Bretu has supervised systems and technology for the company and has implemented many strategic initjatjves, including the automatjon of core business functjons. Most recently, Bretu has acted as project manager of the massive, multj-year restructuring of corporate process and instjtutjonalizatjon of technology infrastructure, which has resulted in streamlined operatjons and positjoned the company for rapid growth.
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Juyuan Wei is the Vice President of Strategic Planning and Analysis and has been with Westwood for the past two years. He leads the Strategic Planning & Analysis team which is responsible for fjrm-wide fjnancial analytjcs, quarterly forecastjng, and annual
fjnancial reportjng along with real estate KPI metrics. Dana Rainford is the Head of Human Resources. She has over 15 years of HR experience with a strong track record in leading
In her current role, Dana is responsible for leading Westwood’s overall human resources strategy including talent acquisitjon;
Tim Chung is the Associate General Counsel and manages the legal department on a wide range of legal matuers such as leasing,
worked at Morrison & Foerster. Tim received a BA from UCLA and a JD from Southwestern Law School and is a lecturer in law at UCLA Law School and USC Law School. Nadia Gregoriou is the Director of Accountjng. She is a Certjfjed Public Accountant with over 15 years of post-qualifjcatjon
servicing commercial real estate companies including CIM Group and DLC Management. At CIM, she served as a Corporate Accountjng Manager, overseeing corporate accountjng and the implementatjon of ASC 606. At DLC, she served as the Financial Reportjng Manager, overseeing the property accountjng team and external reportjng functjons of a large retail portgolio consistjng
accountjng team. Volker Schramm is the Director of Marketjng and has been with Westwood since 2013. He has over 25 years of experience as a creatjve marketjng and design professional with a history of functjonal experience and a consistent record of identjfying and delivering marketjng and branding solutjons. Prior to Westwood, Volker managed the branding and communicatjons for TELACU, one of the largest community development corporatjons in the natjon. He oversaw the marketjng needs of its 12 diverse subsidiaries which included real estate, constructjon, fjnance, and educatjon.
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Executjve Role Tenure (Former Firm) Mark Bratu CEO 30 years (CBRE; SITC; MSREF) Matu Lougee EVP, Finance & Accountjng 12 years (SITC) David Malayil EVP, Leasing 18 years (Macerich) Juyuan Wei VP, SP&A 12 years (Irvine Co.) Doug Howell VP, Property Management 30 years (Weitzman) Dana Rainford Head of HR 13 years (Citj) Board Members Mark Bratu Westwood Financial Martjn Caverly 2120 Partners Chris Lee CEL & Associates Founders & Co-Chairmen of the Board Steven Fogel 49 Years Howard Banchik 49 Years Department Count Property Management 16 Accountjng 12 Leasing 7 Services 5 Transactjons 3 Capital Markets/Investor Relatjons 3 Legal 3 Strategic Planning & Analysis 2 Systems 2 Human Resources 1 Marketjng 1
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Westwood Financial (310) 820-5443 11440 San Vicente Boulevard, Suite 200 Los Angeles, CA 90049
Mark Bratu
Chief Executjve Offjcer mbratu@westfjn.com
Matu Lougee
Executjve Vice President, Finance & Accountjng mlougee@westfjn.com
David Malayil
Executjve Vice President, Leasing dmalayil@westfjn.com
Doug Howell
Vice President, Property Management dhowell@westfjn.com
Juyuan Wei
Vice President, Strategic Planning & Analysis jwei@westfjn.com
Miki Antunovich
Vice President, Investor Relatjons, Tax & Accountjng mantunovich@westfjn.com