The Investor and Capital Markets Perspective December 1, 2011 - - PowerPoint PPT Presentation

The Investor and Capital Markets Perspective

Private Equity, Pension Funds, Lifecos and REITS

December 1, 2011

The Investor and Capital Markets Perspective Private Equity, Pension Funds, Lifecos and REITS q y, ,

• Phil Gillin, Senior Managing Director, Head of Canadian Real Estate

Sun Life Assurance Company of Canada

• Don Clow President & CEO
• Don Clow, President & CEO

Crombie REIT

• Stephen Taylor, President & COO

Morguard Investments Limited

• Blair Tamblyn, President & CEO

Timbercreek Asset Management Inc Timbercreek Asset Management Inc.

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Phil Gillin Senior Managing Director Head of Canadian Real Estate Sun Life Assurance Company of Canada

The Village at Thunderbird Centre Geographic Location Geographic Location

Sunwood Square Meadowvale Shopping Centre Westgate Shopping Centre Village At Thunderbird Centre

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The Village at Thunderbird Centre Aerial Photo Aerial Photo

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The Village at Thunderbird Centre North Complex Photos North Complex Photos

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The Village at Thunderbird Centre North Complex Site Plan North Complex Site Plan

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The Village at Thunderbird Centre South Complex Photos South Complex Photos

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The Village at Thunderbird Centre South Complex Site Plan South Complex Site Plan

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Don Clow P id t &CEO President &CEO Crombie REIT

✓

Everyday Performance Everyday Performance

Toronto Real Estate

• Toronto Real Estate

Forum

• Donald Clow FCA , CEO

, December 2011

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• 1. Well Located and Diversified Portfolio

136 Properties 136 Properties 12.3 million feet of GLA $1 8 Billion FMV Assets $1.8 Billion FMV Assets $900M Market Cap 47 Year Operating History ea Ope at g sto y

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6 1

14 14

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• 1. Well Located and Diversified Portfolio

Portfolio Characteristics

• Defensive portfolio - approx 80%
• f properties are grocery

anchored + Avalon Mall, St John’s is one of the Top 20 regional malls anchored Avalon Mall, St John s is one of the Top 20 regional malls in Canada

• Average lease term is one of the longest in the REIT space at

approximately 10 years

• Outside of Sobeys no other tenant represents more than 1.9%
• f

annual minimum rent annual minimum rent

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• 2. High Quality Cash Flow

Quality covenants

• Over 50%
• f annual minimum rent from investment grade tenants
• > 89%
• f annual rent derived from national and regional tenants
• In line with investment grade REITs

S t NOI g th S ame asset NOI growth

• S

ame-asset property NOI long term growth of 1-2%

S trong Anchor Tenant: S

• beys

S trong Anchor Tenant: S

• beys
• S

econd largest grocery anchor in Canada (approximately $15B in sales)

• Investment grade rated
• S

trong same store sales growth

• Growing national footprint (1300+ stores)

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• 3. Moderate & Conservative Leverage with Ample Liquidity
• Leverage of 50-60%
• f GBV (Including Converts)
• One of the longest average mortgage terms in the REIT space - 7.4 years

Focus on longer term debt duration (e.g. – 20 year mortgage at 5.06% )

• Liquidity - $150-200 million Revolver ($100M undrawn) + $80M

unencumbered assets

• S

ustainable payout ratios –Target 95%

• f AFFO Growth traj ectory and
• rganic improvements in existing assets should allow us to attain this goal in

the medium term

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• 4. Significant Future Growth Potential

Multiple growth strategies

• Internal growth – growing same-asset NOI, LUI and

Development Development

• $300-$500 million pipeline from S
• beys - $100M per year
• S

ylvie Lachance leads S

• beys Development
• S
• beys lease “ ROFR’s”
• 3rd party acquisitions – target = $100M per year of high

quality properties

• Runnymede – “ learn how to win”

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• 3. Significant Future Growth Potential

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Stephen Taylor P id t & COO President & COO Morguard Investments Limited

Morguard Group A U d M Assets Under Management

Retail $4 5 $4.5 Residential $1 3

AUM by Investor PRL $ 1 5 B

$1.3

PRL $ 1.5 B Sep Acc’ts $ 4.8 B MRC $ 2.4 B MRT $ 2 0 B

Industrial $1.7

MRT $ 2.0 B $ 10.7 B

Office $3.2

Market Cap (Nov 24, 2011) MRC $959 MM

(13 MM h $73 96)

MRC $959 MM

(13 MM shares at $73.96)

MRT $861 MM

(57 MM units at $15.10)

Morguard Corporation 2011 I P 2011 Investment Program

Available Equity Capital q y p

$350 - $550 MM

(excludes proceeds of asset sales or equity issues) ( p q y )

Investment Strategy

Canada USA Core 10% 40% Value Add 25% 25%

Morguard Corporation 2011 I E l C d 2011 Investment Examples - Canada

Tweedsmuir Residential - Toronto 150 Elgin - Ottawa Bramalea City Centre - Brampton

Bramalea City Centre I f E i

2006 St biliz d

Impact of Expansion

2006 Stabilized GLA (‘000’s sf) 1,221 1,478 NOI $22.8 $38.1 Cap Rate 6.75% 5.75% Market Value $331 $662 Market Value $331 $662 Debt $100 $259 Net Asset Value $231 $401 Development Cost $183 Incremental NOI $15.3 8.4% (on DC) $

( )

Capital Appreciation $148 28.8% (on OMV + DC)

Morguard Corporation 2011 I E l USA 2011 Investment Examples - USA

Boynton Town Centre - Florida Douglas Emmett Fund X Los Angeles

Boynton Town Centre A i i i P Acquisition Parameters

GLA (‘000’s sf) 224 NOI $4.5 Purchase Price $59 Debt $38 (at 5%) Debt $38 (at 5%) Net Asset Value $21 ROI (C R ) 7 6% ROI (Cap Rate) 7.6% ROE 12.4%

Blair Tamblyn P id t & CEO President & CEO Timbercreek Asset Management Inc.

TIMBERCREEK

Asset Management g

TORONTO REAL ESTATE

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FORUM 2011

TIMBERCREEK SNAPSHOT

• $1.7 billion in Assets Under Management (2 public / 5 private vehicles)
• Integrated National platform: 400 Employees; 10 regional offices
• 2012 Capital Program: +/‐ $250 million across platform

$1.7B UNDER MANAGEMENT

Private Equity

Di R l E

Private Debt

M t I t t

Public Equity / Debt

Direct Real Estate Assets: $1.3 Billion Mortgage Investments Assets: $350 Million Global Real Estate Securities Assets: $100 Million

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DIRECT INVESTMENT – EQUITY: VALUE VALUE – ADD / OPPORTUNISTIC: TORONTO, ON ADD / OPPORTUNISTIC: TORONTO, ON ,

B E F O R E A F T E R

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DIRECT INVESTMENT – DEBT: ACQUISITION CREDIT FACILITY ACQUISITION CREDIT FACILITY - ONTARIO ONTARIO

UNDERWRITING SITE VISITS DUE DILIGENCE

Loan Amount $40,000,000 Loan-to-Value First Mortgage: Up to 75% Second Mortgage: Up to 85%

COMMITTEE REVIEW

Term 18 months Loan Type Fully Open Revolving Facility Effective Interest Rate Blended 8.75%

FUNDED

PAGE 29 Payment Interest-only PAGE 29

Popper Questions

Question 1 Audience Participation Question For being such a great audience, Gorgeous George P. has decided to give each audience member $10,000 to invest one of two ways; $ , y ; 1) in a mattress, or 2) in the S&P/TSX Index. ) The catch is that the group that has the highest net worth on July 1, 2012 gets ALL of the money from the other group as well. By a show of hands which group would you be in?

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Question 2 George P. gives each panel member a $50,000 honorarium for participating in this panel on the condition that an investment decision must be made this morning before we leave the hall.........each is asked where he would place the money: a) as a down payment on a downtown Toronto condo to be delivered in 2014 b) in the TSX REIT index fund c) in a private syndicate investing in office and industrial properties d) in Target common shares e) in Canada Savings Bonds

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Question 3 In addition to the original $50,000, Generous George gives each panel member an additional $100,000 for winning the "BEST PANEL" award. The only provision is that each member must invest it with one of the other panel members for a 5 year term. First, where within your company would you invest the $100,000 contribution? S d h i h d h b ' i t t l hi h ld i k Second, having heard each member's investment plan, which company would you pick to invest your money with and why?

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Q & A