Attached files
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| 8-K - FORM 8-K 06/11/2012 - KITE REALTY GROUP TRUST | form8k_06112012.htm |
Meetings with Investors & Analysts New York,
NY
NY
NAREIT REITWeek 2012
June
2012
2012
KITE HEADQUARTERS Indianapolis, IN
KITE REALTY GROUP
2
DISCLAIMER
This presentation contains certain statements that are not historical fact and may constitute forward-
looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks, uncertainties and other factors which
may cause the actual results of the Company to differ materially from historical results or from any
results expressed or implied by such forward-looking statements, including, without limitation: national
and local economic, business, real estate and other market conditions, particularly in light of the recent
slowing of growth in the U.S. economy; financing risks, including the availability of and costs associated
with sources of liquidity; the Company’s ability to refinance, or extend the maturity dates of, its
indebtedness; the level and volatility of interest rates; the financial stability of tenants, including their
ability to pay rent and the risk of tenant bankruptcies; the competitive environment in which the
Company operates; acquisition, disposition, development and joint venture risks; property ownership
and management risks; the Company’s ability to maintain its status as a real estate investment trust
(“REIT”) for federal income tax purposes; potential environmental and other liabilities; impairment in the
value of real estate property the Company owns; risks related to the geographical concentration of our
properties in Indiana, Florida and Texas; assumptions underlying our anticipated growth sources; and
other factors affecting the real estate industry generally. The Company refers you to the documents filed
by the Company from time to time with the Securities and Exchange Commission, specifically the
section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2011, which discuss these and other factors that could adversely affect the Company’s
results. The Company undertakes no obligation to publicly update or revise these forward-looking
statements (including the FFO and net income estimates), whether as a result of new information, future
events or otherwise.
looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks, uncertainties and other factors which
may cause the actual results of the Company to differ materially from historical results or from any
results expressed or implied by such forward-looking statements, including, without limitation: national
and local economic, business, real estate and other market conditions, particularly in light of the recent
slowing of growth in the U.S. economy; financing risks, including the availability of and costs associated
with sources of liquidity; the Company’s ability to refinance, or extend the maturity dates of, its
indebtedness; the level and volatility of interest rates; the financial stability of tenants, including their
ability to pay rent and the risk of tenant bankruptcies; the competitive environment in which the
Company operates; acquisition, disposition, development and joint venture risks; property ownership
and management risks; the Company’s ability to maintain its status as a real estate investment trust
(“REIT”) for federal income tax purposes; potential environmental and other liabilities; impairment in the
value of real estate property the Company owns; risks related to the geographical concentration of our
properties in Indiana, Florida and Texas; assumptions underlying our anticipated growth sources; and
other factors affecting the real estate industry generally. The Company refers you to the documents filed
by the Company from time to time with the Securities and Exchange Commission, specifically the
section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2011, which discuss these and other factors that could adversely affect the Company’s
results. The Company undertakes no obligation to publicly update or revise these forward-looking
statements (including the FFO and net income estimates), whether as a result of new information, future
events or otherwise.
3
COMPANY OVERVIEW
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Stable Operating Portfolio
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• Owned interests in 63 operating properties totaling approximately 9.5 million square feet of
gross leasable area (GLA) • Diverse tenant base: Largest tenant (Publix) represents only 3.0% of annualized base rent
• 5 mile demographics: Population - 126,000; Average Household Income - $85,000
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Increased Leasing & Operating
Productivity
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• Same property net operating income for the first quarter of 2012 increased 5.4% over the
same period in the prior year. • Revenue from property operations increased 9.8% in the first quarter over the prior year.
• 10 consecutive quarters of positive cash rent spreads.
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Development & Redevelopment
Progress |
• Delray Marketplace: Construction continues at Delray Marketplace in Delray Beach, Florida
and scheduled to open in November 2012. • New Hill Place: Target closed on the purchase of a 12.8 acre parcel in March 2012 at New
Hill Place Phase I near Raleigh, North Carolina. A loan commitment has been received to fund construction and site work has commenced. • Four Corner Square: Demolition work is underway at Four Corner Square near Seattle,
Washington. A loan commitment has been received to fund construction. • Oleander Place: Whole Foods at Oleander Place in Wilmington, North Carolina opened at
the end of May 2012. • The Centre: Signed anchor lease with Earth Fare subsequent to quarter end.
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Debt & Capital Markets
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• Closed on a $125 million unsecured seven-year term loan.
• Closed on an amendment to the $200 million unsecured revolving credit facility that reduced
the interest rate and extended the maturity date. • No 2012 maturities remain and only $4.1 million matures over the next 12 months.
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Information as of March 31, 2012
LEASING
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PORTFOLIO SAME STORE NOI TRENDS
KITE REALTY GROUP
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LEASED PERCENTAGES: RETAIL OPERATING PORTFOLIO
KITE REALTY GROUP
CASH RENT SPREADS
KITE REALTY GROUP
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Q1
2012
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FY
2011
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FY
2010
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New Leases
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13.5%
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8.6%
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9.8%
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Renewals
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0.4%
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2.9%
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<3.5%>
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Weighted Total
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7.2%
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6.4%
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5.1%
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• Ten consecutive quarters of positive aggregate cash rent spreads
QUALITY RETAIL TENANT BASE
KITE REALTY GROUP
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(1) Annualized base rent represents the monthly contractual rent for March 2012 for each applicable tenant multiplied by 12. Excludes tenant reimbursements.
(2) S&P credit ratings for parent company as of 4/20/2012.
Information as of March 31, 2012
DEVELOPMENT/REDEVELOPMENT
KITE REALTY GROUP
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DELRAY MARKETPLACE
Delray Beach, Florida
Delray Beach, Florida
Development Update
• Including anchors Publix and Frank
Theatres, we currently have 26
executed leases. The center is
approximately 73% pre-leased or
committed.
Theatres, we currently have 26
executed leases. The center is
approximately 73% pre-leased or
committed.
• Vertical construction is underway and
tenant deliveries will begin in July.
tenant deliveries will begin in July.
• The $93 million project is scheduled
to open in November 2012.
to open in November 2012.
KITE REALTY GROUP
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FOUR CORNER/MAPLE VALLEY
Maple Valley, Washington
Maple Valley, Washington
Development Update (cont.)
•Commenced construction in Q1, 2012.
•Three anchor leases for 80,000 total square
feet are fully executed with Grocery Outlet,
Johnson’s Home & Garden, and Walgreens.
feet are fully executed with Grocery Outlet,
Johnson’s Home & Garden, and Walgreens.
•Received a loan commitment from US Bank
for $22.8 million with a closing expected in
June.
for $22.8 million with a closing expected in
June.
•The $24 million project is scheduled to
partially open in late 2012.
partially open in late 2012.
KITE REALTY GROUP
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OLEANDER PLACE
Wilmington, North Carolina
Wilmington, North Carolina
Development Update (cont.)
• The February 2011 acquisition of
the Lowe’s Foods anchored
center was redeveloped as a
Whole Foods in just 15 months.
the Lowe’s Foods anchored
center was redeveloped as a
Whole Foods in just 15 months.
• The Whole Foods opened on
May 28, 2012; significantly
increasing the overall value of the
asset.
May 28, 2012; significantly
increasing the overall value of the
asset.
• The project is 80.5% pre-leased
or committed as of March 31,
2012.
or committed as of March 31,
2012.
Before
After
KITE REALTY GROUP
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HIGH QUALITY RECENTLY COMPLETED REAL ESTATE
Rivers Edge
• Successfully redeveloped and was
100% leased as of March 31, 2012.
100% leased as of March 31, 2012.
• Anchored by Nordstrom Rack, The
Container Store, buybuy Baby, Arhaus
Furniture, and BGI Fitness.
Container Store, buybuy Baby, Arhaus
Furniture, and BGI Fitness.
Eddy Street Commons
• Successfully developed and was
95.4% leased as of March 31,
2012.
95.4% leased as of March 31,
2012.
• Anchored by Urban Outfitters,
Hammes Bookstore, and University
of Notre Dame.
Hammes Bookstore, and University
of Notre Dame.
KITE REALTY GROUP
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HIGH QUALITY RECENTLY COMPLETED REAL ESTATE
Cobblestone Plaza
• Successfully developed and was
92.2% leased as of March 31, 2012.
92.2% leased as of March 31, 2012.
• Anchored by Whole Foods, Party City,
and All Pets Emporium.
and All Pets Emporium.
South Elgin Commons
• Successfully developed and was
100% leased as of March 31, 2012.
100% leased as of March 31, 2012.
• Anchored by LA Fitness, Toys “R”
Us/Babies “R” Us, Ross Stores and
a non-owned Super Target.
Us/Babies “R” Us, Ross Stores and
a non-owned Super Target.
• Currently under contract to sell.
DEBT & CAPITAL MARKETS
KITE REALTY GROUP
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BALANCE SHEET PROGRESS
• Annual debt maturities of less than $50 million through 2015.
• Unencumbered asset pool increased to over 40% of total assets and continues to
expand.
expand.
KITE REALTY GROUP
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DEBT AND CAPITAL MARKETS UPDATE
Primary Balance Sheet Initiatives
• Manage floating rate debt to a target of 20% of total debt.
• De-levering in process through NOI growth, non-core asset sales, and select
acquisitions.
acquisitions.
Significant 2012 Debt Transactions
• Closed on $125 million unsecured seven-year term loan with an interest rate of
LIBOR plus 210 to 310 basis points.
LIBOR plus 210 to 310 basis points.
• Closed on an amendment to the $200 million unsecured revolving credit facility
that reduced the interest rate by 35 basis points and extended the term to April
30, 2017, including a one-year extension option.
that reduced the interest rate by 35 basis points and extended the term to April
30, 2017, including a one-year extension option.
• Finalize construction loans for development at Four Corner Square/Maple Valley
and New Hill Place - Phase I.
and New Hill Place - Phase I.
KITE REALTY GROUP
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SCHEDULE OF DEBT MATURITIES
Substantially completed goal of extending and staggering our near-term debt maturities
Information as of March 31, 2012 (1)
(1) As adjusted for April placement of term loan and amendment of unsecured line of credit.
(2) Chart excludes annual principal payments and net premiums on fixed rate debt.
(3) Assumes the Company exercises the one year extension option on unsecured line of credit.
KITE REALTY GROUP
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CASH NOI GROWTH
• Projected cash NOI growth from executed leases at recently completed developments and a
redevelopment.
redevelopment.
Information as of March 31, 2012
• Additional cash NOI growth from Delray Marketplace, New Hill - Phase I, and Four Corner
(which have recently commenced construction) will occur over the next 12 to 18 months.
(which have recently commenced construction) will occur over the next 12 to 18 months.
• Our Debt-to-EBITDA ratio will improve as tenants who have executed leases take occupancy
and developments/redevelopments open.
and developments/redevelopments open.