Crombie Real Estate Investment Trust · TSX:CRR.UN
Crombie Real Estate Investment Trust — Q4 2021 Earnings Presentation
38 slides from Crombie Real Estate Investment Trust's earnings presentation, Mar 18, 2022
Slide 1: Proven Stability and Sustainable Growth
Proven Stability and Sustainable Growth Investor Presentation March 2022
Slide 2: Cautionary statements
Cautionary statements Forward-looking Information: Readers are cautioned that such forward looking statements are subject to certain risks and uncertainties that could cause actual This presentation contains forward-looking statements that results to differ materially from these statements. Crombie
Slide 3: A leader in Canadian real estate
A leader in Canadian real estate Strong, stable portfolio with opportunity for growth High-quality grocery-anchored VECTOM1 focused value- Strong financial position with portfolio driving strong, enhancing development access to multiple sources of predictable cash flow growth pipeline capital $5.3-7
Slide 4: Crombie continues to outperform the TSX and Real Estate Sector
Crombie continues to outperform the TSX and Real Estate Sector1 Crombie REIT S&P/TSX Capped REIT Index 600 S&P/TSX Composite Index Crombie REIT CAGR 10.9% 500 Total Return¹ (Indexed) 400 S&P/TSX Capped REIT Index CAGR 8.4% 300 S&P/TSX Composite CAGR 6.7% 200 100 0 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10
Slide 5: Well-positioned with defensive portfolio
Well-positioned with defensive portfolio Property % of Full % of Q4 % of Full Type Year 2020 2021 Gross Year 2021 Gross Rent Rent Gross Rent Collected Collected Collected Retail 96% 99% 99% Office 99% 100% 100% Retail-related industrial 100% 100% 100% Total 96% 99% 99% 5
Slide 6: Near-term priorities
Near-term priorities Deliver strong risk-adjusted returns and accelerate NAV and AFFO growth per unit Stable Portfolio Robust Development Strong Financial Pipeline Condition • Elevating portfolio quality and • Focused on high growth mixed- • Disciplined and innovative capital strength use urban and
Slide 7: High-quality, sustainable property portfolio underpins growth platform
High-quality, sustainable property portfolio underpins growth platform Strong, Stable Strategic Partnership Development Strong Financial Highly Skilled Team Portfolio Pipeline Condition and Caring Culture Well-positioned Aligning strategies with Focused on high growth Optimal low-cost capital Attrac
Slide 8: Strong, stable portfolio of high-quality properties
Strong, stable portfolio of high-quality properties Low-risk property portfolio backed by grocery and pharmacy tenants generates stable cash flow Annual minimum rent Gross leasable area by asset type by market class >69% Retail-related industrial of AMR derived from 5.7% Rest of Canada VECTOM tenant
Slide 9: Built in organic growth drives value creation
Built in organic growth drives value creation Long-term earnings and cash flow stability Same-asset property cash NOI2 +2.4% Q4 2021 $64,442 ~5.3% net property income Q4 2020 $62,935 growth1 for the three months Renewal spreads ended December 31, 2021 is Q4 2021 primarily due to income from complete
Slide 10: Strategic partnership with Empire identifying and unlocking future value
Strategic partnership with Empire identifying and unlocking future value Capitalizing on a wide range of strategic transactions with Empire 86% 12.2 years • Developing highly-tailored properties designed of retail properties weighted average remaining to meet Empire’s current and future needs anchor
Slide 11: Balancing defensive grocery-anchored portfolio with offensive mixed-use development strategy
Balancing investment in a defensive grocery- anchored portfolio with an offensive mixed-used development strategy Aligning strategies with Empire to maximize value Montreal and Calgary Customer creation Fulfillment Centres A prime example of strong relationship with Empire and development expertise
Slide 12: Voilà Hub and Spoke Concept
Voilà Hub and Spoke Concept Accelerate the build-out of Empire’s online grocery home delivery service There are two types of opportunities for Crombie to participate in spoke locations. Crombie can (i) purchase land and develop a greenfield spoke facility; or (ii) repurpose existing space within our
Slide 13: Development pipeline drives future value creation
Development pipeline drives future value creation Creating our vision of how people want to live, work, shop, and play Primarily mixed-use, high density developments in urban centers Major development pipeline 74% located in VECTOM 1 Pipeline properties with zoning 19% approval 1 1 11 5 5 Pipeline p
Slide 14: Unlocking value with strong development pipeline
Unlocking value with strong development pipeline 31 development pipeline projects 6 705,000 sq.ft commercial GLA 495,000 sq.ft residential GLA 6 178,000 sq.ft commercial GLA 300,000 sq.ft retail-related 25 1,150,000 sq.ft commercial GLA 9,852,000 sq.ft residential GLA completed near-term1,2 medium p
Slide 15: Development pipeline completions drives value creation
Development pipeline completions drives value creation 2020 2021 2022+ Q1 2020 Belmont Market Q3 2020 Avalon Mall Phase I Q1 2021 Q1 2022 Davie Street Bronte Village Q4 2020 Avalon Mall Phase II Residential Q2 2020 Davie Street Retail CFC 3 Calgary, AB Q4 2020 Montreal CFC Q3 2021 Le Duke 15
Slide 16: Substantially Completed Major Developments
Substantially Completed Major Developments Substantial Estimated Total Commercial Residential Residential Property CMA Ownership Completion Project Cost GLA GLA Units Date ($ in millions) Belmont Market1,2 Victoria 100% Q1 2020 160,000 - - $93.0 Davie Street – Retail1 Vancouver 100% Q2 2020 54,000 -
Slide 17: Near-term major development pipeline
Near-term major development pipeline Focus on mixed-use developments in Canada's top urban and suburban markets Retail-related Property CMA Commercial GLA Residential GLA Residential Units industrial GLA Bronte Village1 Toronto 54,000 - 466,000 481 Voilà CFC 3 (Calgary) 1 Calgary - 300,000 - - Westh
Slide 18: Major development pipeline
Major development pipeline # Property CMA Site Size Project Timing (acres) 1 Bronte Village1 Toronto 6 Near-term 2 Voilà CFC 31 Calgary 25 Near-term Total of 31 major 3 Westhill on Duke Halifax 1 Near-term 4 Belmont Market - Phase II Victoria 2 Near-term developments, incl. 8 5 Broadway & Commercial
Slide 19: Distinct Opportunities for Value Recognition
Distinct Opportunities for Value Recognition Significant entitlement of development lands Lynn Valley, Vancouver, Rendering accelerates growth Completion of development projects increases fair value, NAV and AFFO growth Developments increase urban concentration and diversification 19
Slide 20: Building Financial Strength
Building Financial Strength Interest coverage1,2 $1.8B $508M BBB (low) Fair value of Available 3.13x negative trend unencumbered liquidity DBRS rating provides assets Debt to Adjusted attractive unsecured debt EBITDA1,2 financing As at December 31, 2021 8.25x Debt to Gross Book Value Optimal Low-Cos
Slide 21: Financial strength and flexibility
Financial strength and flexibility Strategically deploying capital to build long-term value for our stakeholders As at December 31 2021 2020 2019 2018 2017 Over the last three years, disposed of Available Liquidity $508 $472 $449 $312 $438 ~$784M of assets and (millions) reinvested ~$459M in Unencum
Slide 22: Access to ample liquidity
Access to ample liquidity JV facilities sufficient to complete construction costs Balance as at Authorized Available Facility Maturity Date December 31, 2021 Amounts Liquidity Revolving Credit Facility $12M $400M $388M June 30, 2025 Bilateral Credit Facility $10M $130M $120M June 30, 2023 Subtotal $
Slide 23: Innovative capital funding
Innovative capital funding Strategic capital management priorities • Maintain multiple sources of both debt and equity financing • Keeping in line with maintaining multiple sources of debt; subsequent Q4 2021, Crombie issued $200 million in equity financing, the net proceeds were used to repay outst
Slide 24: Well-Laddered Debt Maturity Profile
Well-Laddered Debt Maturity Profile Extending Weighted Average Term to Maturity $286M of maturing debt in 2022 Increasing allocation to with weighted average interest unsecured debt, allowing $700 5.0% rate of 3.93% Millions for additional future financing flexibility 4.5% $600 4.0% $500 3.5% 3.0% $
Slide 25: Environmental, social, and governance (ESG) considerations
Environmental, social, and governance (ESG) considerations 1 Environment Social Governance 1 • Sustainable construction • Talent attraction, • Board composition and and design development, and governance retention • Energy consumption • Risk management • Diversity, equity, and inclusion • Healthy, s
Slide 26: 2021 sustainability highlights
2021 sustainability highlights 29 electric vehicle $14.9M invested in ~2M square feet of charging stations1 at LED upgrades at 154 portfolio BOMA BEST properties across the properties since 2020 1 certified country Environmental 54% of senior 26% of hires in the 66% of internal leadership under the
Slide 27: Crombie's sustainable path forward
Crombie’s sustainable path forward Key initiatives: Collecting, monitoring, and tracking against our sustainability data using Measurabl Assessing and incorporating recommendations for climate-related financial disclosure from the Task Force on Climate-Related Financial Disclosures (TCFD) Continue t
Slide 28: Q4 2021 financial highlights
Q4 2021 financial highlights Stable, predictable results demonstrate consistency and reliability of grocery-anchored portfolio Property revenue Q4 2021 Driven by $103,832 • Increased rental revenue from development activity, strong occupancy, and modernizations. Q4 2020 $ 97,060 +6.98% Operating inc
Slide 29: Long-term value creation
Long-term value creation Strong, stable portfolio with opportunity for growth Value-enhancing Strategic partnership Strong financial major development with Empire position pipeline Grow grocery-anchored Collaboration with Empire Ample cost-effective capital, retail & advance drives operational stabi
Slide 30: Appendix
Appendix Investor Presentation
Slide 31: Crombie-at-a-glance
Crombie-at-a-glance Portfolio Overview1 Portfolio Fair Value by Market Class Investment Properties $5.0B VECTOM Rest of Canada Gross Leasable Area 17,861,000 sq.ft 40.7% 32.9% Committed Occupancy 96.2% $5.0B 2021 Same-Asset Cash NOI Growth2 5.0% Renewal Leasing Spreads 3.4% Major Markets Renewals 90
Slide 32: Featured major developments
Featured major developments Meaningful value creation arising from development projects in VECTOM Davie Street Bronte Village Le Duke Voilà CFC 3 Vancouver, BC Oakville (Toronto), ON Montreal, QC Calgary, Alberta 32
Slide 33: Featured properties: Davie Street
Featured properties Davie Street is Crombie’s first major mixed-use development. A significant milestone was achieved in the first quarter of 2021 as Zephyr, the residential component of the development, reached substantial completion. Zephyr is owned in partnership with Westbank and contains 330 re
Slide 34: Featured properties: Bronte Village
Featured properties Bronte Village will be a special luxury rental opportunity in a vibrant, unique and highly sought after community. This 50% JV development will include 481 units of refined rental living and a 30,000 sq.ft Farm Boy, which opened in June 2021. Substantial completion is expected in
Slide 35: Featured properties: Le Duke
Featured properties Reaching substantial completion in the third quarter of 2021, Le Duke is nestled between the blossoming Griffintown neighborhood and the charming Old Port of Montreal with the recently completed Bonaventure Expressway sitting just outside. In partnership with Prince Developments,
Slide 36: Featured properties: Voilà CFC 3
Featured properties The Calgary Voilà CFC will be the third Empire grocery e-commerce fulfillment hub in Canada. Powered by Ocado plc’s leading technology, this will further enrich Crombie’s footprint in VECTOM and continue to diversify Crombie’s portfolio. Crombie acquired the 25-acre site in June
Slide 37: Calculation of non-GAAP measures
Calculation of non-GAAP measures1 Debt to Gross Book Value 2021 2020 2019 2018 2017 Debt $ 2,263,318 $ 2,491,191 $ 2,317,265 $ 2,488,665 $ 2,514,266 Gross Fair Value 5,273,052 5,040,231 4,740,281 4,878,752 5,001,499 Debt to Gross Fair Value 42.9 % 49.4 % 48.9% 51.0% 50.3% Debt to Trailing 12 Months
Slide 38: Investor relations contacts
Clinton Keay, CFO and Secretary [email protected] (902) 755-8100 Ruth Martin, Director, Investor Relations and Financial Analysis [email protected] (902) 759-0164 crombiereit.com
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