Trade Street Residential — Merger or Acquisition (June 2015)
20 slides from Trade Street Residential's merger presentation, Jun 5, 2015
Slide 1: Creating a leading regional multifamily platform
Independence Realty Trust Creating a leading regional multifamily platform June 2015
Slide 2: Disclaimer
Disclaimer SAFE HARBOR STATEMENT UNDER THE PRIVATE LITIGATION REFORM ACT OF 1995 This presentation may include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-l
Slide 3: Who are we?
Who are we? IRT is an apartment REIT focused on building a portfolio of well-located apartment properties which generate attractive current returns, stable occupancy and the potential for rent increases and improved operating efficiency – Listed on the NYSE MKT in August 2013 – “IRT” – Targets marke
Slide 4: Management team
Management team Scott F. Schaeffer Chairman and CEO – Independence Realty Trust, Inc. Chairman and CEO – RAIT Financial Trust Been with RAIT Financial Trust for 15 years serving in a variety of roles Extensive real estate experience (30 years) specializing in acquiring and financing investments in a
Slide 5: Independent Board of Directors
Independent Board of Directors William Dunkelberg Independent director since February 2011 Chairman of the board of directors since July 2005 and member of the audit committee since 2003 of Liberty Bell Bank Served as chief economist for the National Federation of Independent Business, a nonprofit i
Slide 6: Sponsor: RAIT Financial Trust
Sponsor: RAIT Financial Trust (NYSE: RAS) RAIT is a multi-strategy commercial real estate company organized as an internally-managed REIT with $4.6 billion of assets under management as of March 31, 2015 – RAIT’s IPO – January 1998 Scalable “in-house” commercial real estate platform with over 775 em
Slide 7: Transformative combination
Transformative combination On May 11, 2015 IRT entered into a definitive merger agreement to acquire TSRE 1 Enhanced scale – Combined scale will provide an enhanced platform to pursue accretive acquisitions and transformational opportunities – Number of properties increase from 31 to 50(a) – Number
Slide 8: The combination will provide enhanced scale
1 The combination will provide enhanced scale… Combined company expected to have over $1.4 billion of total capitalization and over $500 million of equity market capitalization ($ in millions) Independence Realty Trust Trade Street Residential Independence Realty Trust Trade Street Residential Prope
Slide 9: A continuation of IRT's regional market expansion strategy
1 …and is a continuation of IRT’s regional market expansion strategy Since January 2014, IRT has acquired 40 properties totaling 11,254 units, representing ~4x unit growth(a) Oklahoma Portfolio Louisville Portfolio Trade Street Residential Purchase Date February 28, 2014 Purchase Date December 8, 20
Slide 10: Improved operating margins, portfolio quality and average age
2 The combination will result in improved operating margins, portfolio quality and average age Independence Realty Trust Trade Street Residential Independence Realty Trust Trade Street Residential C 13% B 27% C 8% Property class breakdown(a) A 25% B 62% A 73% A 45% B 47% Average base rent $827 $1,03
Slide 11: New assets have high occupancy and ABR
2 New assets have high occupancy and ABR… Fountains Southend Location Charlotte, NC Year Built / Renovated 2013 Number of units 208 Year completed 2013 Average base rent $1,247 Occupancy 97.9% Average unit size (square feet) 844 Key highlights Class A multifamily community located just outside of do
Slide 12: Will significantly enhance IRT's portfolio quality
2 …and will significantly enhance IRT’s portfolio quality Talison Row at Daniel Island Location Daniel Island, SC Year Built / Renovated 2013 Number of units 274 Year completed 2013 Average base rent $1,383 Occupancy 95.6% Average unit size (square feet) 989 Key highlights Class A apartment building
Slide 13: Accelerates penetration of high-growth regional markets
3 Accelerates penetration of high-growth regional markets TSRE’s complementary portfolio increases IRT’s geographic diversification, adding exposure to 8 new high quality regional markets and increasing presence in 3 existing markets TSRE market statistics 2015E – 2019E CAGR Market Units Pop. growth
Slide 14: Embedded growth opportunities and meaningful synergy potential
4 Embedded growth opportunities and meaningful synergy potential The merger presents a unique opportunity to reduce the combined company G&A costs to industry norms As a part of the transaction, IRT and RAIT have agreed to change the base asset management construct from 0.75% of total assets to 1.5%
Slide 15: Transformative combination
Transformative combination Enhanced scale Improved portfolio quality Accelerates market penetration Immediate financial benefit Independence Realty Trust 15
Slide 16: Appendix
Independence Realty Trust Appendix
Slide 17: Pro forma balance sheet for March 31, 2015
Pro forma balance sheet for March 31, 2015 ($ in thousands) IRT Historical Bayview Adjustments IRT Historical, As Adjusted TSRE Historical Pro Forma Adjustments Consolidated Pro Forma (1) (2) (3) (4) Assets Investment in real estate at cost $689,867 $25,031 – $714,898 $587,509 $45,824 (5) $1,348,231
Slide 18: Pro forma income statement for three months ended March 31, 2015
Pro forma income statement for the three months ended March 31, 2015 ($ in thousands) IRT Historical Bayview Adjustments IRT Historical, As Adjusted TSRE Historical Pro Forma Adjustments Consolidated Pro Forma (1) (2) (3) (4) Revenue Rental Income $19,443 $564 – $20,007 $14,113 – $34,120 Tenant reim
Slide 19: Pro forma income statement for twelve months ended December 31, 2014
Pro forma income statement for the twelve months ended December 31, 2014 ($ in thousands) IRT Historical 2014 Acquisitions Bayview Adjustments IRT Historical, As Adjusted TSRE Historical Pro Forma Adjustments Consolidated Pro Forma (1) (2) (3) (4) (5) Revenue Rental income $44,834 $32,546 $2,267 – $
Slide 20: Cira Centre, Philadelphia contact details
Independence Realty Trust Cira Centre 2929 Arch Street, 17th Floor Philadelphia, PA 19104 (215) 243-9000 Independence Realty Trust 20
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