Kite Realty Group Trust · NYSE:KRG

Kite Realty Group Trust — Investor Presentation (March 2017)

30 slides from Kite Realty Group Trust's investor presentation, Mar 3, 2017

  1. Slide 1: Investor Update March 2017

    INVESTOR UPDATE MARCH 2017 City Center (White Plains, NY) Eddy Street Commons (South Bend, IN)

  2. Slide 2: Company Snapshot

    © 2017 Kite Realty Group kiterealty.com Investor Update | 2 COMPANY SNAPSHOT KITE REALTY GROUP TRUST Note: All data as of 12/31/16. 1.) Source: SNL; Dividend yield calculated as most recent quarterly dividend, annualized and expressed as a percentage of the security price. 2.) Demographic data for i

  3. Slide 3: Kite's Core Model Intertwined in All Aspects

    © 2017 Kite Realty Group kiterealty.com Investor Update | 3 KITE’S CORE MODEL INTERTWINED IN ALL ASPECTS CORPORATE IDENTITY & OPERATIONS HIGH-QUALITY PORTFOLIO PORTFOLIO TRANSFORMATION INVESTMENT GRADE BALANCE SHEET  Long-serving, experienced management team  Community involvement  Top-tier opera

  4. Slide 4: Kite Provides Attractive Investment Opportunity

    © 2017 Kite Realty Group kiterealty.com Investor Update | 4 KITE PROVIDES ATTRACTIVE INVESTMENT OPPORTUNITY 1.) Source: SNL Financial; Total Return (RMS Index) and implied dividend contribution (estimated as RMS less RMZ index) from December 2009 – December 2016. 2.) 2017E FFO per share refers to co

  5. Slide 5: Corporate Identity & Operations

    CORPORATE IDENTITY & OPERATIONS

  6. Slide 6: Company and Portfolio Transformation Since 2010

    © 2017 Kite Realty Group kiterealty.com Investor Update | 6 $1.70 $2.06 2010 2016  Transformed 82% of portfolio into higher- quality assets since 2010 (1)  Obtained investment grade rating by Moody’s and S&P (Baa3 / BBB-)  Increased free cash flow from less than $10mm in 2010 to ~$45mm  Achieved

  7. Slide 7: Kite Consistently Maintains Top-Tier SPNOI Growth

    © 2017 Kite Realty Group kiterealty.com Investor Update | 7 KITE CONSISTENTLY MAINTAINS TOP-TIER SPNOI GROWTH 5.5% 4.9% 4.2% 3.6% 3.6% 3.3% 3.3% 3.3% 3.1% 3.1% 2.5% ROIC AKR KRG EQY REG RPAI WRI BRX FRT DDR KIM QUARTERLY AVERAGE SPNOI GROWTH FROM 2013-2016 (1) Peer Average ~3.6% 1.) Figures exclude

  8. Slide 8: Continued Operational Efficiencies Within Portfolio

    © 2017 Kite Realty Group kiterealty.com Investor Update | 8 CONTINUED OPERATIONAL EFFICIENCIES WITHIN PORTFOLIO 83.4% 85.9% 89.5% 89.6% 89.0% 87.3% 90.1% 89.2% 95.4% 95.3% 95.2% 94.8% 94.9% 95.4% 95.2% 95.4% Q2'13 Q4'13 Q2'14 Q4'14 Q2'15 Q4'15 Q2'16 Q4'16 % Recovery - Retail Portfolio % Leased - Ret

  9. Slide 9: Sustainability and Corporate Responsibility

    © 2017 Kite Realty Group kiterealty.com Investor Update | 9 SUSTAINABILITY AND CORPORATE RESPONSIBILITY COMMITTED TO THE COMMUNITY ENVIRONMENTALLY-CONSCIOUS INTIATIVES TOTAL KITE ENVIRONMENTAL SAVINGS (1) • Facilitate opportunities to meet the needs, improve wellness, and enhance educational experie

  10. Slide 10: High-Quality Portfolio

    HIGH-QUALITY PORTFOLIO

  11. Slide 11: High-Quality, Diverse Tenant Base and Geography

    © 2017 Kite Realty Group kiterealty.com Investor Update | 11 Midwest 17.2% Northeast 11.1% Mid- Central 17.5%West 12.2% Southeast 17.7% Florida 24.3% HIGH-QUALITY, DIVERSE TENANT BASE AND GEOGRAPHY Top Tenants By ABR # Stores % ABR 1 Publix 16 2.8% 2 TJ Maxx 22 2.5% 3 Petsmart 20 2.2% 4 Bed Bath & B

  12. Slide 12: Asset Quality Supported by Market Demographics

    © 2017 Kite Realty Group kiterealty.com Investor Update | 12 ASSET QUALITY SUPPORTED BY MARKET DEMOGRAPHICS ASSETS ACROSS THE TOP 5 MARKETS SUPERIORLY POSITIONED Average Household Income ($000s) Source: STI: Popstats; information based on a 3-mile radius for the KRG portfolio. $75 $91 $87 $75 $84 $6

  13. Slide 13: Necessity Driven and Internet Resistant Retailer Base

    © 2017 Kite Realty Group kiterealty.com Investor Update | 13 INTERNET RESISTANT 49.7% SERVICES, ENTERTAINMENT 18.4% GROCERY, SPECIALTY STORES 15.7% RESTAURANTS 15.6% OMNI-CHANNEL 42.1% SOFT GOODS 18.1% HOME IMPROVEMENT GOODS 10.6% DISCOUNT RETAILERS 9.6% SPORTING GOODS 3.8% NON-RESISTANT 8.2% ELECTR

  14. Slide 14: Investment Grade Balance Sheet

    INVESTMENT GRADE BALANCE SHEET

  15. Slide 15: Resilient Balance Sheet

    © 2017 Kite Realty Group kiterealty.com Investor Update | 15 RESILIENT BALANCE SHEET  Moody’s / S&P Ratings: Baa3 / BBB-  Fixed Charge Coverage: 3.3x (1)  Net Debt / Adjusted EBITDA: 7.0x  Secured Debt / Undepreciated Total Assets: 16.9%  Unencumbered Assets / Total Assets: ~65%  Weighted Aver

  16. Slide 16: Further Enhanced Financial Flexibility

    © 2017 Kite Realty Group kiterealty.com Investor Update | 16 2010 2016 1.5x higher FURTHER ENHANCED FINANCIAL FLEXIBILITY NET DEBT / ADJUSTED EBITDA 2010 2016 FLOATING RATE EXPOSURE 21% 7% -1,400 bps FIXED CHARGE COVERAGE 2010 2016 7.0x ~2x lower 9.1x  Continue to improve investment grade metrics 

  17. Slide 17: Efficient Funding Structure Relative to Peers

    © 2017 Kite Realty Group kiterealty.com Investor Update | 17 EFFICIENT FUNDING STRUCTURE RELATIVE TO PEERS DDR BRX REG RPAI EQY ROIC WRI KRG RPT KIM WEIGHTED AVERAGE MATURITIES SCHEDULE AND WEIGHTED AVERAGE INTEREST RATE Weighted Average Interest Rate 6.4 Years 4.0% Weighted Average Debt Maturity No

  18. Slide 18: Well-Staggered Debt Maturity Profile

    © 2017 Kite Realty Group kiterealty.com Investor Update | 18 WELL-STAGGERED DEBT MATURITY PROFILE SCHEDULE OF DEBT MATURITIES ($000s) (1) 7 39 45 170 215 215 11 80 200 200 95 80 75 300 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027+ Mortgage Debt Line of Credit Term Loan Private Placement Se

  19. Slide 19: Portfolio Transformation

    PORTFOLIO TRANSFORMATION

  20. Slide 20: 3-R Opportunities & In-Process Redevelopment Projects

    © 2017 Kite Realty Group kiterealty.com Investor Update | 20 3-R OPPORTUNITIES & IN-PROCESS REDEVELOPMENT PROJECTS 3-R PLATFORM  Redevelop: substantial renovations; e.g. teardowns, remerchandising, exterior / interior improvements  Repurpose: substantial alterations including changing the product-

  21. Slide 21: Portofino Shopping Center (Houston, TX) Case Study

    © 2017 Kite Realty Group kiterealty.com Investor Update | 21 PORTOFINO SHOPPING CENTER (HOUSTON, TX) CASE STUDY: A TWO-PHASED PROJECT PHASE I  Demolition/expansion of existing vacant space to accommodate Nordstrom Rack and rightsizing existing Old Navy store  Shop relocation and façade renovations

  22. Slide 22: City Center (White Plains, NY): A Case Study

    © 2017 Kite Realty Group kiterealty.com Investor Update | 22 CITY CENTER (WHITE PLAINS, NY): A CASE STUDY  Reactivating street-level retail and enhancing overall shopping experience  Located in a premier business district, ranked 5th in annual sales volume in New York  Renovation complete in Nove

  23. Slide 23: Bolton Plaza (Jacksonville, FL): A Case Study

    © 2017 Kite Realty Group kiterealty.com Investor Update | 23 BOLTON PLAZA (JACKSONVILLE, FL): A CASE STUDY  Demolition of small shops to make way for a new Aldi and a new Marshalls  Aldi construction set to commence and Marshalls scheduled to open in Q1’17  Total Cost: $6.0-$7.0 million  % Total

  24. Slide 24: Internal NOI Growth Opportunities

    © 2017 Kite Realty Group kiterealty.com Investor Update | 24 INTERNAL NOI GROWTH OPPORTUNITIES 2017 expected same-property NOI growth of 2-3% with additional growth from our current development pipeline and future 3-R projects Operating Properties  Positive cash rent spread on renewals – goal of 8-

  25. Slide 25: Forward-Looking Statements

    © 2017 Kite Realty Group kiterealty.com Investor Update | 25 FORWARD-LOOKING STATEMENTS This supplemental information package contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such state

  26. Slide 26: Non-GAAP Financial Measures: FFO

    © 2017 Kite Realty Group kiterealty.com Investor Update | 26 NON-GAAP FINANCIAL MEASURES Funds from Operations Funds from Operations (FFO) is a widely used performance measure for real estate companies and is provided here as a supplemental measure of operating performance. We calculate FFO in accor

  27. Slide 27: Non-GAAP Financial Measures: EBITDA

    © 2017 Kite Realty Group kiterealty.com Investor Update | 27 NON-GAAP FINANCIAL MEASURES Earnings Before Interest Expense, Income Tax Expense, Depreciation and Amortization (EBITDA) We define EBITDA, a non-GAAP financial measure, as net income before depreciation and amortization, interest expense a

  28. Slide 28: Appendix – Reconciliation of FFO to Net Income

    © 2017 Kite Realty Group kiterealty.com Investor Update | 28 APPENDIX – RECONCILIATION OF FFO TO NET INCOME 1.) “FFO of the Operating Partnership" measures 100% of the operating performance of the Operating Partnership’s real estate properties. “FFO attributable to Kite Realty Group Trust common sha

  29. Slide 29: Appendix – Reconciliation of Same Property NOI to Net Income

    © 2017 Kite Realty Group kiterealty.com Investor Update | 29 APPENDIX – RECONCILIATION OF SAME PROPERTY NOI TO NET INCOME 1.) Same property analysis excludes operating properties in redevelopment as well as office properties (Thirty South Meridian and Eddy Street Commons). 2.) Excludes leases that a

  30. Slide 30: Appendix – Reconciliation of EBITDA / Adjusted EBITDA to Net Income

    © 2017 Kite Realty Group kiterealty.com Investor Update | 30 APPENDIX – RECONCILIATION OF EBITDA / ADJUSTED EBITDA TO NET INCOME 1.) Represents Adjusted EBITDA for the three months ended 12/31/16 multiplied by four. December 31, Consolidated net income 3,900$ Adjustments to net income: Depreciation

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