The Irreplaceable Corner TM Company Disclosure Cautionary Statement - - PowerPoint PPT Presentation

the irreplaceable corner tm company disclosure
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The Irreplaceable Corner TM Company Disclosure Cautionary Statement - - PowerPoint PPT Presentation

The Irreplaceable Corner TM Company Disclosure Cautionary Statement Regarding Forward-Looking Statements The Company has made forward-looking statements in these materials which are subject to risks and uncertainties. These statements are based


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The Irreplaceable CornerTM Company

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www.amreit.com 2

Disclosure

Cautionary Statement Regarding Forward-Looking Statements The Company has made forward-looking statements in these materials which are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of the Company, and on the information currently available to the Company. When used or referred to in these materials, these forward-looking statements may be preceded by, followed by or otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “plans,” “estimates,” “projects” or similar expressions, or statements that certain events or conditions “will” or “may” occur. These forward-looking statements are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements:

  • revenue of the Company may be lower than expected
  • occupancy rates from the Company’s properties may deteriorate or fail to recover as predicted;
  • the Company may not be able to sustain the rental rate increases upon lease renewals that it has recently experienced;
  • the Company may experience tenant defaults due to recessionary conditions, as well as tenant bankruptcies and abandonments of leases;
  • general economic conditions, either internationally or nationally or in the jurisdictions in which the Company is doing business, may be less favorable than

expected;

  • legislative or regulatory changes, including changes in environmental regulation, may adversely affect the businesses in which the Company is engaged;
  • there may be environmental risks and liability under federal, state and foreign environmental laws and regulations; and
  • changes may occur in the securities or capital markets.

Where to Find Additional Information The Company’s stock is registered with the Securities and Exchange Commission (“SEC”) under the 1933 Securities Act and complies with the filing requirements

  • f the 1934 Securities Act. As such, the Company has made its quarterly Form 10Q and Annual Form 10K filings that are available at the SEC’s website at

www.sec.gov. Additionally, the Company maintains a web site at www.amreit.com where these public filings can be obtained as well as other corporate and property information. Except for its ongoing obligations to disclose material information as required by the federal securities laws, the Company has no intention or obligation to update these forward-looking statements.

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Where Have We Been – Vision 2010

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Vision 2010 - Phases

Phase I: Business Model – changes to reach greater efficiency and reduce volatility

  • f earnings. This phase includes the elimination of the general contracting

business and IBD Securities business. G&A Savings of approximately $4.5 million per year. Phase I was executed during the 3rd and 4th quarters of 2008. Phase II: Capital Structure – changes to reach greater efficiency and reduce volatility of earnings. This will include the simplification of AmREIT’s equity capitalization into one Class of stock, the consolidation of AmREIT into REITPlus and the privatization of the Company. Phase II was executed during 2009. Phase III: Growth & Liquidity – made possible by Phase I and II as we pursue our goal of listing on the NYSE or through an institutional recapitalization.

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Phase I – Business Model Changes $1.8 million $10 million Transaction Fee Required To Reach FFO Goal (including bonus) 50 70

  • No. of Employees

$7.8 million $14.8 million G & A Budgeted 2010 Pre- Phase I

AmREIT AmREIT

Development Development

Property Management Property Management Leasing Leasing Asset Management Asset Management General Contracting General Contracting IBD Securities IBD Securities

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AmREIT $450 Million $8 Million

AmREIT, Inc.

Phase II – Capital Structure (Three Step Combination) Step One: Privatization through voluntary De-listing of Class A Shares from trading on NYX Step Two: Re-domicile AmREIT from Texas to Maryland Step Three: Reverse merger of AmREIT into REITPlus AmREIT

A – 5.3 million shares C – 4.1 million shares D – 11.0 million shares

Simplified capital structure with one class of stock outstanding

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Strong Balance Sheet, No Material Near Term Maturities

16% $ 29,966 2017+ 11% $ 20,000 2016 27% $ 49,000 2015 24% $ 43,985 2013 8% $ 14,417 2012 11% $ 20,205 2011 3% $ 5,083 2010 Percent

  • f Total

Outstanding Amount Year Secured Debt Maturities

  • Total debt represents 48.7% of appraisal value, or approximately 56% of un-depreciated book basis.

2015 27% 2016 11% 2017+ 16% 2012 8% 2010 3% 2011 11% 2013 24%

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Where we are going – Vision 2012

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AmREIT: Strategic Planning Vision 2012 - Objective

To provide superior long term returns to Institutional Investors over differing economic cycles (objective)

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AmREIT: Strategic Planning Vision 2012 - Advantage

Through our 26 years of best of class local acquisition, capitalization,

  • peration and redevelopment expertise

(advantage)

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AmREIT: Strategic Planning Vision 2012 - Scope

And our relentless focus upon the maximization of value on retail & mixed use Irreplaceable Corners ™ within Texas-- the top job growth market in the U.S. & 12th largest economy in the world, ahead of Mexico, Russia and India (GDP). (scope)

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AmREIT: Strategic Planning Vision 2012 - Believability

And through leveraging our $1 Billion platform, experienced management team and a portfolio that ranks higher in qualitative measurements than the gold standard of the industry, to become the preferred retail & mixed use investment choice of the best Institutional Investors in the U.S. (believability)

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Our Markets Regional Focus, Local Sharpshooter

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Where We Invest and Why

Rank Region 2008-2013 1 Dallas-Fort Worth-Arlington TX 295,700 2 Houston-Baytown TX 225,200 3 San Antonio-Austin-Round Rock TX 201,000 4 Washington-Arlington DC-VA-MD-WV 166,200 5 Los Angeles-Long Beach CA 120,000 6 Chicago-Naperville IL 92,800 7 New York-Wayne NY-NJ 89,500 8 Minneapolis-St. Paul MN-WI 82,500 9 Philadelphia PA 74,800 10 St Louis MO-IL 71,900 EMPLOYMENT GROWTH PROJECTIONS Ranked by Job Growth from 2008-2013 Rank Region 2008-2013 1 Dallas-Fort Worth-Arlington TX 693,900 2 Houston-Baytown TX 621,600 3 Atlanta-Sandy Springs GA 579,800 4 Phoenix-Mesa-Scottsdale AZ 546,800 5 Los Angeles-Long Beach CA 488,300 6 San Antonio-Austin-Round Rock TX 472,000 7 Washington-Arlington DC-VA-MD-WV 269,400 8 Chicago-Naperville IL 259,100 9 New York-Wayne NY-NJ 236,100 10 Riverside-San Bernardino CA 213,300 POPULATION GROWTH PROJECTIONS Ranked by Population growth from 2008 to 2013

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Houston, Dallas, San Antonio/Austin … The

Source: David Winans, GMAC Real Estate, 2009

Houston is headquarters to 29 Fortune 500 Companies (2

nd

behind NY) Port of Houston is the 2

nd busiest port in the World

Dallas is headquarters to 25 Fortune 500 Companies (3

rd behind

NY and Houston) DFW airport ranks 3

rd in the US

79% of all US-Mexico traded passes through Texas Lowest cost of living of any major MSA in the US

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AmREIT, Inc. Real Estate Platform – Poised for Growth

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AmREIT Advised Funds Joint Ventures

Real Estate Investment Platform

Total Real Estate Platform Approaching $1 Billion

AmREIT Balance Sheet $450 Mil Institutional Joint Ventures $160 Mil Advised Funds

“High Net Worth Individuals”

$300 Mil

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Uptown Park

Corner of Post Oak Blvd. and Loop 610

AmREIT

3 Miles 5 Miles Estimated Population: 131,556 426,010 Estimated Ave. HHI: $105,321 $89,900 Year Acquired: 2005 Land Area: 16.85 acres Retail SF: 169,110 SF Traffic Counts: Vehicles Per day Loop 610 300,000 Post Oak 40,000 approx.

High daytime population with neighboring complementary uses of residential, office and hotel. Development potential for 200 room hotel and 200,000 s.f. office. Increased market rents from high $20’s to low $40’s. NOI exceeding initial underwriting by $800,000.

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South Bank on the Riverwalk; San Antonio, TX

AmREIT The Alamo and Riverwalk are the #1 and #2 tourist destinations in Texas. Due to percentage rent, NOI was $190,000 more than the original projection upon acquisition. Tenant sales have increased consistently for

  • ver 10 years.

Estimated # of Tourists: 21 million Year Acquired: 2005 Retail SF: 47,000 SF

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3 Miles 5 Miles Estimated Population: 148,619 410,882 Estimated Ave. HHI: $110,381 $83,529 Year Acquired: 2004 Retail SF: 144,623 SF Traffic Counts: Vehicles Per Day Buffalo Speedway 21,750 Westpark Drive 27,600 US 59 Frontage Rd. 151,000

Center is anchored by the top grossing Kroger in Texas and the southwest region. Tremendous in-fill location off Highway 59 at the entrance to the affluent West University submarket.

Plaza in the Park

Houston, Texas

AmREIT

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Purchased by an AmREIT-affiliated fund along with JP Morgan Asset Management in February 2008. 616,372 s.f. shopping center including all anchor spaces on lease and 15 pad sites

Shadow Creek Ranch Town Center

Corner of Hwy 288 and FM 518 (Broadway); Pearland, Texas

Institutional JV

Anchor tenants include HEB Plus!, Academy Sports + Outdoors, Hobby Lobby and Ashley Furniture. Pad site tenants include Denny’s, Frost Bank, Comerica, Taco Cabana, Wachovia Bank and Compass Bank.

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3 Miles 5 Miles Estimated Population: 118,100 389,689 Estimated Ave. HHI: $47,512 $198,278 Year Acquired: 2006 Land Area: 26 acres Retail SF: 325,000 SF Traffic Counts: Vehicles Per Day Buckner 39,760 Garland 35,242

The second oldest shopping center in Dallas; construction began on Casa Linda Plaza in 1945. Includes 3 of 4 corners. Dense population despite inclusion of White Rock Lake in the 3-mile ring $6 million renovation completed

Casa Linda Shopping Center

Corner of Garland and Buckner; Dallas, Texas

Advised Funds

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3 Miles 5 Miles Estimated Population: 202,894 571,045 Estimated Ave. HHI: $72,599 $72,317 Year Acquired: 2007 Land Area: 20.7 acres Traffic Counts: Vehicles Per Day Westheimer 74,260 Gessner 30,460 Total 104,720

Redeveloping a grocery anchored infill project with new Safeway guaranteed ground lease and existing Walgreens.

Woodlake Square

Corner of Westheimer and Gessner; Houston, Texas

Advised Funds

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3 Miles 5 Miles Estimated Population: 174,988 455,151 Estimated Ave. HHI: $93,626 $88,349 Year Acquired: 2006 Land Area: 3.29 acres Office SF: 133,507 SF Traffic Counts: Vehicles Per Day Westheimer 58,980 Yorktown 11,200

Bought 3.3 acre site with a 133,500 s.f. office building as a re-development opportunity on an Irreplaceable Corner™. aLoft Hotel, a Starwood hotel, opened August 13, 2009.

5433 Westheimer

Corner of Westheimer and West Alabama; Houston, Texas Advised Funds

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5433 Westheimer

Advised Funds

After Before

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Location, Location, Location Demographics & Operational Performance

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Portfolio Quality

Source: Merrill Lynch Research, AmREIT Demographics

FRT EQY National Avg WRI REG KIM DDR

AmREIT

Shopping Center Avg $40,000 $45,000 $50,000 $55,000 $60,000 $65,000 $70,000 $75,000 $80,000 $85,000 $90,000 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200

Households Per Square Mile Median Household Income in a 3 Mile Radius

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Portfolio Occupancy

Source: Company Public Filings

Occupancy

88.0% 90.0% 92.0% 94.0% 96.0% 98.0% 100.0% 2005 2006 2007 2008 2009 2010E

DDR EQY WRI KIM REG FRT AmREIT

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Portfolio Leasing Spreads – Location Matters

Source: Company Public Filings

Leasing Spreads

  • 6.0%
  • 1.0%

4.0% 9.0% 14.0% 19.0% 2005 2006 2007 2008 2009

DDR EQY WRI KIM REG FRT AmREIT

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Occupancy & Leasing Spreads

Source: Company Public Filings

Occupancy/Leasing Spreads 2005 - 2009

DDR WRI KIM REG FRT EQY

AmREIT

91.0% 92.0% 93.0% 94.0% 95.0% 96.0% 97.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0%

Leasing Spreads Occupancy

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Occupancy & Same Store Growth

Source: Company Public Filings (KIM excluded as they did not report SSNOI for 2006 and 2005

Occupancy/Same Store 2005 - 2009

DDR WRI REG FRT EQY

AmREIT

91.0% 92.0% 93.0% 94.0% 95.0% 96.0% 97.0% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0%

Same store NOI growth Occupancy

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Performance Summary

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Comparable Company Metrics – Best in Class

Multiple as of April 2010, SS NOI, Occ and Leasing Spread as 5-year average, Leverage & Payout as of 12/31/2009.

Multiple SSNOI Occ. Lease Spread Leverage PayOut FRT 19.6 2.9% 95.8% 14.0% 62.0% 75.0% AmREIT NA 5.2% 95.9% 10.1% 60.0% 71.0% AKR 16.9 1.9% 94.8% N/A 75.0% 58.0% BFS 18.3 1.5% 93.7% 0.2% 61.0% 72.0% REG 17.3 1.2% 91.7% 9.1% 51.0% N/A WRI 14.3 1.2% 92.7% 8.3% 52.0% 65.0% EQY 17.8 0.9% 92.7% 6.4% 56.0% 65.0% KIM 14.7 N/A 92.8% 12.6% 49.0% 88.0% DDR 12.7 1.1% 94.4% 7.3% 61.0% N/A Average 16.45 2.0% 93.8% 8.5% 58.6% 70.6%

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AmREIT, Inc.: The Team

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AmREIT – Management Team

  • H. Kerr Taylor

Founder, Chairman, CEO Over 30 years of experience and a 25 -year track record in the commercial real estate industry and fiduciary to over 6,000 investors.

Chad Braun

Executive Vice President & CFO President, AmREIT Securities Company 15 years of commercial real estate experience, helped grow AmREIT from $100 million to approximately $1 Billion in assets.

Tenel Tayar

Senior Vice President & Chief Investment Officer Over 15 years of commercial real estate experience and responsible for approximately $1 billion in real estate transactions.

Charles Scoville

Senior Vice President & Director of Operations Over 25 years of commercial real estate experience and responsible for leasing, property management, leasing and asset management.

Brett Treadwell

Managing Vice President - Finance Former senior manager with PriceWaterhouse Coopers. Has over 17 years of experience in the accounting and financial reporting industry.

Ron Lindsey

Managing Vice President - Development Almost 30 years of commercial real estate experience and responsible for over $600 million in real estate transactions.

Steve Hefner

Managing Vice President - Director of Dallas Operations 20 years of experience in the commercial real estate industry and responsible for over $1 billion in acquisitions and $500 million in dispositions.

Jason Lax

Managing Vice President - Construction 10 years of commercial real estate experience providing construction and construction management services . Formerly with Trammell Crow and Exxon/Mobile.

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Independent Board of Directors

Mack D. Pridgen, III Attorney with tax and audit experience and top executive of Highwoods (NYSE) while they grew from $250 million to $4.5 Billion. Scot J. Luther CEO and founder of retail real estate development company. Brent M. Longnecker Former national partner with Deloitte Touche, author

  • f eight books on governance and compensation

and CEO of national consulting organization.

H.L. “Hank” Rush, Jr.

CEO Star of Hope. Formerly top executive of BMC Software and Stewart Title.

Phillip Taggart

President and Chief Executive Officer of Taggart Financial Group, Inc. and co-author of “Taking Your Company Public”.

Robert S. Cartwright, Jr.

Graduate of Harvard (BA) and Stanford (PHD). Distinguished professor of Rice University.

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Next Steps for: Conformity, Growth, Liquidity

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Thoughts on next steps… Vision 2012

Potential Steps/Sources for Growth and Liquidity: 1. IPO on New York Stock Exchange

  • Traditional Public REIT Structure
  • Concern over FFO Multiples and Size

2. Institutional Joint Ventures – Property Level/Fund Creation

  • Maintain entity and strategic control
  • Efficiency concerns and fragmented growth

3. Institutional Investment – Balance Sheet

  • Increase and Expand AmREIT Balance Sheet with Liquidity
  • Lose Control and Concern over Alignment

4. Sell the Company

  • Not a Desire – We have a Vision of Growth and Liquidity
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Good Things Happen on Great Real Estate™

Pound for Pound… Best Located Portfolio in Texas Thank You

www.amreit.com