September 2021 Investor Presentation - Pivoting toGrowth
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Advancing Simplification, Pivoting to Growth September 2021 Investor Presentation
Statements in this presentation that are not historical facts are forward-looking statements within the
SAFE meaning of the Private Securities Litigation Reform Act of 1995 that involve a number of risks and
uncertainties that could cause actual results to differ materially from those contemplated by the relevant
HARBO R forward-looking statements.
These forward-looking statements include, but are not limited to, statements regarding possible or
STATEMENT assumed future results of operations, business strategies, growth opportunities and competitive positions,
as well as the rapidly changing challenges with, and the Company's plans and responses to, the novel
coronavirus (COVID-19) pandemic and related economic disruptions. Such forward-looking statements
speak only as of the date the statements were made and are not guarantees of future performance.
Forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors
that could cause actual results and the timing of certain events to differ materially from those expressed in
or implied by the forward-looking statements. These factors include, but are not limited to, prevailing
market conditions and other factors related to the Company's REIT status and the Company's business, risks
associated with COVID-19 and its impacts on the Company's businesses, results of operations, liquidity and
financial condition, the evaluation of alternatives by the Company related to its materials and construction
business and by the Company's joint venture related to the development of Kukui‘ula, generally discussed
in the Company's most recent Form 10-K, Form 10-Q and other filings with the SEC. The information in this
presentation should be evaluated in light of these important risk factors. We do not undertake any
obligation to update the Company's forward-looking statements.
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 2
SUPERIOR
M A R K E T F U N D A M E N TA L S
Dynamic, Growing Market with Structural Limitations
on New Supply
HIGH-QUALITY
PORTFOLIO
ADVANCING Irreplaceable Assets with
Embedded Growth Opportunities
SIMPLIFICATION,
PIVOTING TO S I M P L I F I C AT I O N
NEARING COMPLETION
Facilitates Pivot Back to CRE Investments
GROWTH
STRONG
BALANCE SHEET
Supports Accelerated Investment Activity
COMMITMENT TO
C O R P O R AT E R E S P O N S I B I L I T Y
Significant Progress in ESG Initiatives in Recent Years
Partners for Hawai‘i
Hawai’i Alexander & Baldwin I NYSE: ALEX 3
KAUAI OAHU
I R R E P L A C E A B L E A S S E T S
O UTSTA ND ING
MAUI
PO RTFO LIO
Strategically located portfolio of
high-quality, needs-based retail, industrial
and ground lease assets $104.2M HAWAI‘I ISLAND
Largest portfolio of grocery-anchored, neighborhood Total NOI (2019; Pre-COVID)
shopping centers in Hawai‘i OAHU
Hawai‘i GDP I 74%
The “one-stop shop” for new market
entrants with both retail and light
industrial/distribution needs
$94.3M Q2 2021 NOI I 73%
Total NOI (2020) MAUI
High-performing market with compelling
growth opportunities Hawai‘i GDP I 11%
• Many retail chains’ top-performing stores are Q2 2021 NOI I 13%
in Hawai‘i (e.g., Sam’s Club, Safeway,
Home Depot and California Pizza Kitchen) $28.5M OTHER ISLANDS
• 32%1 of nation’s top-25 retailers and QSRs Total NOI (Q2 2021) Hawai‘i GDP I 15%
do not currently have any operational
Q2 2021 NOI I 14%
Hawai‘i locations
2: Per State of Hawai‘i DBEDT data.
1: Per QSR Magazine and National Retail Federation data. Note: See appendix for a statement on management’s use of non-GAAP financial measures and reconciliations.
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 4
Estimated return
Return of 10% Return of 11%
of 9% on
on repositioning on repositioning
repositioning
capital spent and capital spent and
capital spend and
current occupancy current occupancy
current occupancy
of 99.1%. of 100%.
of 94.0%.
A I K A H I PA R K S H O P P I N G
PEARL HIGHLANDS CENTER
LAU HALA SHOPS
CENTER Reversion of Ground Lease Asset,
Reversion of
Refresh of Asset and Redevelopment of Aging Asset and
Ground Lease Asset
Effective Leasing GLA Expansion
IRREPLACEABLE ASSETS WITH EMBEDDED GROWTH UPSIDE
E X P E R T I S E I N U N L O C K I N G V A L U E - A D D O P P O R T U N I T I E S
Partners for Hawai’i Alexander & Baldwin I NYSE: ALEX 5
High Retail and Industrial Performance
Due to Market Factors
Fundamentals Drive
Performance
$32.59 vs $20.29
D Y N A M I C M A R K E T W I T H S U B S TA N T I A L A&B Q2 2021 Q2 2021 Peer*
BARRIERS TO ENTRY Retail ABR PSF Average
Retail ABR PSF
HAWAI‘I MARKET: $14.98
A&B Q2 2021
vs $8.48
Q2 2021 Peer*
SUPERIOR LONG - T ERM Industrial ABR PSF Average
Industrial ABR PSF
FUNDAMENTALS Source: Green Street Advisors and
Company disclosures; comparative
data set represents strip retail and industrial
$797 +6%
REITs under Green Street coverage.
A&B Full-Year 2020 Average Increase Over Prior Year
Traditional Grocer Sales Average Traditional Grocer Sales
Strong Consumer Demand Due to Supply Constraints Due to
Favorable Market Metrics Long Entitlement Process
5-Year Hawai‘i Forecasts Lengthy &
(Growth Rates Annualized; 2.8% 3.0% Complex 3-5 3-5 3-5
Rankings 1-50 Entitlement
with 1 being best) JOB GROWTH INCOME GROWTH Process YEARS FOR YEAR FOR STATE YEARS FOR COUNTY
COUNTY LAND USE URBAN URBAN ZONING
GENERAL PLAN DESIGNATION
#3 #4 INCLUSION
RANK IN RANK IN
Source: Green Street Advisors.
JOB GROWTH OUT OF
50
INCOME GROWTH OUT
OF 50 9 to 15 years
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 6
IDENTIFIED ASSET VALUE
At June 30, 2021
Internal capital sources
to fuel CRE growth
Land Ops.
FA C I L I TAT E S P I V OT B A C K T O $236.9M
CRE INVESTMENTS
76% Materials &
Construction
24%
SIMPLIFICATIO N CRE-Identified
Assets Value CRE $2.0B
$202.1M
Other $25.5M
Non-CRE
Assets Value
$1,491.5M
NEARING 22 10
Asset Value
• Land Operations
CO MPLETIO N Retail
Properties
Industrial
Properties
• 25,900-acre land portfolio
• Development-for-sale
Well-positioned for continued simplification.
Expect to achieve vision of becoming a pure-play 4 50+ portfolio
Hawai‘i commercial real estate company in near Office Ground Leases • Materials & Construction
term. Properties on 149 Acres businesses
Steady monetization of non-core assets to date HAWAI‘I NOI
and strong prospects for continued simplification
in 2021 have strengthened balance sheet and 2020 $94.3M
enabled a renewed focus on CRE growth. Nearly
Fourfold
2019 (Pre-COVID) $104.2M
Hawai‘i NOI
Increase
2012 $26.7M Since 2012
0 20 40 60 80 100 120
$ in Millions
Partners for Hawai‘i
Hawai’i Alexander & Baldwin I NYSE: ALEX 7
Note: See appendix for a statement on management’s use of non-GAAP financial measures and reconciliations.
M U LT I - P R O N G E D A P P R O A C H ACTIVE INVESTMENTS TEAM P O T E N T I A L U T I L I Z AT I O N
New acquisitions expected in 2021 OP Units to facilitate tax-advantaged transactions
GROW CRE 150-YEAR HISTORY
Successfully operating in high-performing, high barrier
DEEP EXPERTISE
In development and redevelopment
to entry Hawai‘i market
PORTFOLIO HAWAI‘I “SHARPSHOOTER” GROW CRE PORTFOLIO
THROUGH EXISTING GROUND LEASE, REDEVELOPMENT
Deep market knowledge providing superior Internal options through existing entitled land,
AND ENTITLED LAND OPPORTUNITIES
sourcing advantages, including off-market and ground lease and redevelopment opportunities
first look opportunities
Vast growth opportunities in preferred asset types
Grocery or drugstore INDUSTRIAL ASSET
A N C H O R E D R E TA I L A S S E T
OWNERSHIP IN HAWAI‘I 15 anchored assets OWNERSHIP IN HAWAI‘I 10 Industrial assets
2%
2.2M Sq. Ft. of GLA 1.2M Sq. Ft. of GLA
22%
92.3% Occupancy 97.8% Occupancy
Of Total Improved 98% Of Total Improved
78%
62% Property NOI in 2020 23% Property NOI in 2020
Sq. Ft. of GLA Sq. Ft. of GLA
A&B Other
~10M Total Market A&B Other ~60M Total Market
Partners for Hawai‘i
Hawai’i Alexander & Baldwin I NYSE: ALEX 8
$20 M
Improved Debt Characteristics
• Weighted-average interest rate
STRO NG • Weighted-average maturity
$443M
BALANCE SHEET EFFECTIVE PRIOR
FULL RANGE OF FINANCIAL TOOLS
AND AMPLE LIQUIDITY TO SUPPORT 9/1/2021 6/30/2021 $423 M
A C C E L E R AT E D C R E G R O W T H
$0.813.64%
to $0.87 $0.69 to $0.77
4.15% TOTAL LIQUIDITY I 442.8M
7%
4.3toyears
10% 1% to
4.0 4%
years CASH I $19.9M
UNDRAWN REVOLVER I $422.9M
To improve our financial tools as we focus on growth of our portfolio:
After completing recast of credit facility,
no material debt maturities until 2024
• Completed a recast of our credit facility, which includes favorable changes to all unsecured
debt covenants
• Completed note purchase agreement amendments to our Prudential Private Placement and
AIG notes to conform covenants with bank credit facility
• Established an At-the-Market equity issuance program, though no imminent issuance is As of June 30, 2021, Net Debt to TTM
anticipated Consolidated Adjusted EBITDA was 5.4x,
− Combined with existing share repurchase authorization, provides us robust capital market tools as we down from 6.4x last quarter and from
complete our simplification efforts and pivot to growth 7.1x one year ago
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 9
IMPROVING HAWAI‘I’S COMMUNITIES AND CREATING VALUE FOR STAKEHOLDERS AS PARTNERS FOR HAWAI‘I
COMMITMENT
TO CO RPO RATE ENVIRONMENTAL SOCIAL GOVERNANCE
• Lau Hala Shops • Supported 230 local • Increased Board
RESPO NSIBILITY redevelopment in
Kailua won two awards,
organizations and non-
profits during 2020
independence, and
enhanced gender and
including prestigious ethnic diversity
Proactive ESG agenda implemented over past several
national gold award • Recognized by Nareit as
years, consistent with Company’s DNA and local
from ICSC Silver Award winner for • Board refresh adds new
commitment Diversity, Equity and perspectives and keeps
Inclusion the CEO and Chairman
Published second Corporate Responsibility Report roles separate
with enhanced GHG and SASB disclosures • Recognized by Pacific
Business News as
2020 Nareit Diversity, Equity & Inclusion (DEI) Corporate Award winner
Silver Award Winner; other local and national awards at Business of Pride
for ESG efforts Awards
RECENT ESG
RECOGNITIONS
LINK TO VIDEO
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 10Number of Properties 86+
Retail (“Needs-Based”) 22
Industrial 10
Ground Lease 50+
Office 4
Total GLA (Sq. Ft.)1 3.9 M
Retail 2.5M
Industrial 1.2M
Office 0.1M
Ground Leases 149 acres
Alexander & Baldwin Portfolio Leased Occupancy % 94.0%
BUSINESS OVERVIEW* Portfolio Economic Occupancy % 92.2%
Total Portfolio Rent Spread 11.5%
Total portfolio rent spread for trailing four quarters 7.2%
Annualized Base Rent (ABR) Per Sq. Ft. $26.66
Retail $32.59
Industrial $14.98
Office $32.78
% of Retail ABR from Anchored Properties
89%
(Grocery/Pharmacy/Warehouse Club)
Equity Market Cap $1.3B
Net Debt to TTM Consolidated Adjusted EBITDA 5.4x
Total Liquidity $442.8M
*As of June 30, 2021
1: Due to rounding, Total GLA does not foot to portfolio segments.
Hawai’i
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 11CRE PORTFOLIO CONTINUES TO
PERFORM VERY WELL
Improved tenant performance as Hawai‘i’s economy recovers, with NOI
up nearly 13% over prior quarter and up nearly 29% year-over-year
STRONG DEMAND PERSISTS FOR
NON-CORE ASSETS
Surge in demand for Hawai‘i real estate has supported monetization
efforts of non-core assets
W I T H I N TA R G E T E D
LEVERAGE RANGE,
AT 5 . 4 T I M E S E B I T D A
Shrinks non-CRE asset base and supports pivot back to growth
Q2 2021 HIGHLIGHTS: via acquisitions
S E C O N D C O N S E C U T I V E Q U A R T E R LY
STRONG PERFORMANCE DIVIDEND INCREASE
CONTINUES Dividend is just a penny below pre-COVID levels at $0.18 per share
following 2-cent, or 12.5%, increase
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 12REVISED
GUIDANCE
The Company increased its annual 2021 guidance ORGANIC SAME-STORE GROWTH
Significant contractual rent step-ups across Same-Store portfolio, including
to reflect its improved outlook $1+ million in ground lease growth
I N C R E M E N TA L G R O W T H F R O M D E V E L O P M E N T
• Core FFO per diluted share AND REDEVELOPMENT
New economic occupancy at Ho‘okele Shopping Center and Aikahi Park
• CRE Same-Store NOI Shopping Center: high-six-figure incremental NOI in 2021 and additional
upside beyond this year
COLLECTIONS
REVISED PRIOR
AND BAD DEBT RESERVES
Cash recoveries related to reserves established in 2020 may continue to
$0.81 to $0.87 $0.69 to $0.77
provide an upside opportunity in 2021
7% to 10% 1% to 4%
Note: See appendix for a statement on management’s use of
non-GAAP financial measures and reconciliations.
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 13COMMERCIAL
R EA L ESTAT E
Partners for Hawai’i Alexander & Baldwin I NYSE: ALEX 14A B R E X P O S U R E BY C AT E G O R Y A S O F Q 2 2 0 2 1
PORTFOLIO Strategically diversified portfolio of primarily
grocery-anchored, community-based retail and
CO MPO SITIO N O F services well positioned for an evolving market
a s p e o p l e ’s l i v e s i n c r e a s i n g l y a r e c e n t e r e d
IRREPLACEABLE ASSETS around their neighborhoods.
Portfolio Composition ABR Exposure by Category
% of ABR
Ground/Industrial/Office Essential Retail Non- Essential Retail
18%
16%
Non-Essential
14%
Retail
12%
19% 10%
Essential 8%
Retail/Restaurants 6%
Ground Leases, 4%
Industrial and
48% 2%
Office 0%
33%
Partners for Hawai‘i
Hawai’i Alexander
Alexander & Baldwin
& Baldwin I NYSE:ALEX
I NYSE: ALEX 15ABR BY ANCHORED PROPERTY TYPE
HIGH - QUALITY AS S ETS
Total Portfolio ABR by Anchored Property Type Retail ABR by Anchored Property Type
Office
4%
Strip Retail
Industrial 11%
16%
Grocer/ Warehouse
Pharmacy Club
43%1 22%
Ground
16% Grocer/Pharmacy
67%
Strip Retail
7% Warehouse
Club
14%
1: Includes Shadow-Anchored
89% of Retail ABR is derived from centers anchored
by Grocery, Pharmacy or Warehouse Clubs
Partners for Hawai’i Alexander & Baldwin I NYSE: ALEX 16HIGH - QUALITY TENANTS
Top Ten Tenants
Tenant1 # of Leases ABR Status2 Category
7 $7,425 Paying
Grocery –
National
Low Exposure to Green Street
1 $3,308 Paying
Warehouse – “National Watchlist” Tenants
National
Drugstore –
6 $2,752 Paying
National
Fitness –
Strip Center REITs - Watchlist & Bankruptcy Tenants
1 $2,640 Paying
National (Estimated % of Pro-Rata Rent)
9%
7 $2,045 Paying Grocery – Local
8%
Discount –
2 $1,992 Paying 7%
National
6%
Moving –
2 $1,889 Paying 5%
National
4%
Materials &
3%
1 $1,636 Paying Construction –
Local 2%
Beauty – 1%
3 $1,508 Paying
National
0%
3 $1,358 Paying Pet – National SITC RPAI KIM UE BRX AKR WRI FRT ROIC REG ALEX
BK Tenants Watchlist Tenants
Total 33 $26,553
1: Excludes ground leases. The leased premises in the GP/RM Prestress, LLC lease is yard space and therefore, not included in Source: Green Street Advisors Strip Center Sector Report, August 2020.
GLA.
2: Current status as of June 30, 2021.
Partners for Hawai’i Alexander
Alexander & Baldwin
& Baldwin I NYSE:ALEX
I NYSE: ALEX 172020
KAIMUKI
SECURE, WITH UPSIDE SHOPPING CENTER
Kaimuki Shopping Center ground
GROUND LEASES lease FMV reset resulted in a 29%
ABR increase with additional
contract steps in years 3 and 7.
1 Tenant leases land and operates property for
lease term 2021
A&B collects ground rent, including FMV and HART
2 contractual escalations and/or percentage rent Honolulu County ground lease
during the lease term contractual step-up resulted in a
37% ABR increase.
3 Building and other tenant improvements revert
to A&B upon expiration or tenant default
BENEFITS • Ground lease payment is senior to all other financial FUTURE OPPORTUNITY
obligations
WINDWARD CITY
• Costs of ownership are passed to tenant; minimal SHOPPING CENTER
landlord ownership and operating expenses Windward City Shopping Center
• No capital expenditure or tenant improvement costs ground lease FMV reset upcoming
in 2023, with similar recent FMV
• Minimal property management required resets resulting in 30% to 70%
• Significant value creation upside at lease reversion and ABR increases.
FMV reset
Partners for Hawai’i Alexander & Baldwin I NYSE: ALEX 18GROWTH FRO M VALUE -
ADD REDEVELO PMENT
EXISTING ASSETS WITH OPPORTUNITIES TO
D E P L OY C A P I TA L AT AT T R A C T I V E R E T U R N S
AIKAHI PARK SHOPPING CENTER
• $18.8 million redevelopment at 98,000-sq. ft. center in Kailua remains on budget
• Substantial completion of central shops
After closing the recast credit facility,
• Safeway’s exterior fully renovated no material debt maturities until 2024
• Starbucks grand opening was in May
• Expected to generate incremental NOI in 2021 and additional upside upon
completion
As of June 30, 2021, Net Debt to TTM
Consolidated Adjusted EBITDA was
8.2% to 9% $1.7M 5.4x, down from 6.4x last quarter and
RETURN ON OVERALL COSTS ANTICIPATED
INCREMENTAL ANNUAL from 7.1x one year ago
NOI UPLIFT
Partners for Hawai‘i Alexander
Alexander & Baldwin
& Baldwin I NYSE:ALEX
I NYSE: ALEX 19C O M P E T I T I V E A D V A N T A G E A T M A U I B U S I N E S S P A R K I I
GROUND - UP DEVELO PMENT O F
CO MMERCIAL ASSETS
M AU I B U S I N E S S PA R K I I
R E TA I L
Ho’okele Shopping Center
• Phase one development of
71,400-sq. ft. center complete
• Safeway grocery store, gas
station, and convenience store
anchor property
• Strong phase one leasing
activity continues
• Expected stabilized yield of
approximately 8%
INDUSTRIAL
Highly desirable commercial and
light industrial development
given proximity to Kahului
• 60.3 acres remaining of light industrial lots in Kahului, Maui Airport, Kahului Harbor and main
Maui roadways
• Flexible zoning for light industrial, retail and office use
• Strategically developing and offering build-to-suit lease arrangements for tenants,
while monetizing select parcels to owner-users
Partners forHawai‘i
Partners for Hawai‘i Alexander
Alexander & Baldwin
& Baldwin I NYSE:ALEX
I NYSE: ALEX 20GROWTH VEHICLES CRE GROWTH
VIA ACQUISITIONS
CRE PO RTFO LIO Focused on growth via acquisitions as non-core disposition process continues. Deep
market knowledge and long-standing relationships provide an acquisition advantage,
INVESTMENTS with off-market or first look opportunities.
VIA 1031 EXCHANGES
RECENT ACQUISITIONS (LATE 2018 – EARLY 2019)
Local presence provides
access to off-market $1.0B 90%+ Ag land sale proceeds fully reinvested in A&B’s preferred asset classes of grocery-
anchored, industrial and ground leases; geographically balanced between Oahu and
pipeline: Invested First-look or
since 2013 off-market neighbor islands.
acquisitions
Grocery-Anchored Industrial Ground Lease
Retail Assets Assets Assets
Actively looking to strategically grow CRE portfolio, focused on
industrial and anchored retail assets, with ample future growth
opportunities for both asset classes within Hawai‘i
Target property types
• Anchored & strip retail centers • Sale-leasebacks with creditworthy
• Industrial/flex warehouses businesses Queens’ MarketPlace Kapolei Enterprise Center Kapolei Business Park West Lot 31
• Mixed-use urban with retail • Leased-fee interests
components • Retail/industrial development
opportunities
UPREIT
Structure can provide unique diversification, liquidity and estate benefits to sellers
Waipouli Town Center Opule Street Industrial Home Depot Iwilei
Partners for Hawai’i Alexander &Alexander
Baldwin –&
Alexander Baldwin
&Partners II NYSE:
Baldwin for ALEX
Hawaii
NYSE: ALEX 21 21COVID
U P DAT E
Partners for Hawai’i Alexander & Baldwin I NYSE: ALEX 22CO VID UP D AT E :
MO D E ST RE ST RICTIO NS Hawai‘i Epidemic Curve
1/1/2021 – 9/18/2021
SUCCE SSFUL IN
CURBIN G D E LT A SURGE
IN H AWAI‘I
• 2020 Hawai‘i COVID restrictions led to best health outcomes in
nation, but severe impact to economy
• 2021 recovery in tourism and employment has been dramatic,
with arrivals approaching pre-pandemic levels through most of
summer; July arrivals nearly 90% of 2019 level
• Delta variant surge led to reinstatement of gathering
restrictions, but no stay-at-home order or increased restrictions
on tourism
• Gatherings limited to no more than 10 people indoors
and 25 outdoors
• 50% capacity rules for restaurants and gyms and 6 ft
distancing still in effect
• Governor’s suggestion that visitors stay away has had modest
impact on arrivals
• COVID case counts have dropped in September as gathering
limits seem to be working Source: COVID-19 State of Hawai‘i Portal, Data as of 9/20/2021.
Partnersfor
Partners forHawai‘i
Hawai‘i Alexander & Baldwin I NYSE: ALEX 23CRE RECOVERY
CRE NOI Grew 13% Over Prior Quarter CRE NOI Growth
As Cash Collections Continue to Trend Upward As Covid-Related NOI Charges Decline
30 44 $29.5 $7.5
Covid-Related NOI Charges, Net ($M)
42 $28.5 $6.5
28
Cash Collections ($M)
$27.5
40 $5.5
26 $26.5
NOI ($M)
NOI ($M)
38 $4.5
$25.5
36 $3.5
24 $24.5
34 $2.5
$23.5
22
32 $22.5 $1.5
20 30 $21.5 $0.5
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
NOI Collections NOI Covid-Related NOI Charges (Net)
Partners forHawai‘i
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 24Q2 2021
CRE BAD DEBT RES ERVE
• $14.3 million total reserve as of the end of Q2 2021
• Resort retail responsible for about one-fifth of reserve, despite being just 4% of portfolio
Office Ground Leases
Industrial 1% 1%
10%
Resort
Retail
Resort Retail Ground Leases 4%
19% 16%
Office
4%
Q2 2021 Q2 2021 Retail
Non-
Bad Debt Reserve Industrial
ABR - Portfolio Resort
16% 60%
Retail Non-Resort
69%
Partners for Hawai’i Alexander & Baldwin I NYSE: ALEX 25MOVING FORWARD
OUR
ACTIONS
Business Advocacy Communication Operations Tenant Assistance Cost Control
Continuity
Fully operational Continued Business resources and Increased safety Marketing and operational Continued strategic
workforce with collaboration with local reopening information measures and support, and guidance in expense and capital
phased return to and national provided to ensure signage to welcome accessing government relief spending reductions
office starting in organizations to tenants are well more visitors and resources to partially offset
March advocate for further informed successful BOPIS cash flow impact
Organized with local partners to
reopening the island program in place
provide food boxes to our
economy impacted tenants and their
employees
Proactively provided deferrals
to highest-risk tenants and
addressed rent relief requests
on a case-by-case basis to
Partners for Hawai‘i protect long-term health and Alexander & Baldwin I NYSE: ALEX 26
cash flows of tenantsCASE STUDY
SUPPORTING
OUR TENANTS
A&B created a free Seek & Treat Scavenger Hunt for kids and
families to have physically-distanced fun, while driving foot “Fantastic idea, well executed and such a home run for Merchant’s Row.
traffic to tenants across our shopping centers in Kailua Town. We got so many customers that didn’t know about our store, or even how Hekili Street has
changed over the years. We’ve already had return customers that discovered us from the
seek & treat!” ― Kailua Town Tenant
Media coverage through a Additional online and Over 1,200 kids and Center’s website saw
local news station and social media push their families joined a 157% increase in
community newspaper created buzz the scavenger hunt, website views
creating additional compared to the
shopping and dining annual Halloween
traffic event the prior year
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 27COMMITMENT TO
CO R P O R AT E
RESPONSIBILITY
Partners for Hawai’i Alexander & Baldwin I NYSE: ALEX 28SUPPO RTING O UR COMMUNITIES A&B allocated 20% of its annual giving budget in 2020 to support non-profits on the frontline of COVID-19 relief and to provide stability to those most affected by the impacts of this pandemic in key communities, working with trusted long-term non-profit partners. Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 29
ALIGNED WITH COMMITMENT TO PRINCIPLES OF ESG
BOARD OF
DIREC TO RS UPDATE
BOA RD O F DI RECTO RS ME T RI CS
2016 Now
CHAIR Non-Independent Independent
INDEPENDENT (NYSE) 70%* 86%
Eric Yeaman Doug Pasquale John Leong
Independent Director Lead Independent Director Independent Director
FEMALE 20% 29%
Since 2012 Since 2018 Since October 1, 2020
CURRENT/FORMER Chairman of the Board since Highly respected young leader
3 1
A&B CEO October 1, 2020 in Hawai‘i
ETHNICALLY DIVERSE 50% 43% Brings valuable environmental
and non-profit perspectives
REIT EXPERTISE 10% 43%
*Includes a former CEO who was deemed independent under NYSE standards.
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 30SUPERIOR
M A R K E T F U N D A M E N TA L S
Dynamic, Growing Market with Structural Limitations
on New Supply
HIGH-QUALITY
PORTFOLIO
ADVANCING Irreplaceable Assets with
Embedded Growth Opportunities
SIMPLIFICATION,
PIVOTING TO S I M P L I F I C AT I O N
NEARING COMPLETION
Facilitates Pivot Back to CRE Investments
GROWTH
STRONG
BALANCE SHEET
Supports Accelerated Investment Activity
COMMITMENT TO
C O R P O R AT E R E S P O N S I B I L I T Y
Significant Progress in ESG Initiatives in Recent Years
Partners for Hawai‘i
Hawai’i Alexander & Baldwin I NYSE: ALEX 31APPENDIX Partners for Hawai’i Alexander & Baldwin I NYSE: ALEX 32
CRE NET OPERAT ING INCO ME
RECONCILIATION OF GAAP TO NON- GAAP MEASURES
DOLLARS IN MILLIONS
Three Months Ended Three Months Ended
Change
June 30, 2021 June 30, 2020
CRE Operating Profit (Loss) $18.6 $8.9 $9.7
Plus: Depreciation and amortization 9.5 10.6 (1.1)
Less: Straight-line lease adjustments (1.0) 1.3 (2.3)
Less: Favorable/(unfavorable) lease amortization (0.2) (0.5) 0.3
Plus: Other (income)/expense, net (0.1) 0.1 (0.2)
Plus: Selling, general, administrative and other expenses 1.7 1.8 (0.1)
NOI $28.5 $22.2 $6.3
Less: NOI from acquisitions, dispositions and other adjustments (0.7) (0.6) (0.1)
Same-Store NOI $27.8 $21.6 $6.2
Note: Additional information is included in the Company’s quarterly Supplemental Information report, which is furnished
to the SEC and available at www.alexanderbaldwin.com.
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 33FUNDS FROM O PERAT IO NS ( FFO)
AND CO RE FFO
RECONCILIATION OF NET INCOME (LOSS) AVAILABLE TO A&B COMMON SHAREHOLDERS TO FFO AND CORE FFO
DOLLARS IN MILLIONS
Three Months Ended Three Months Ended
June 30, 2021 June 30, 2020
Net income (loss) available to A&B common shareholders $12.8 $(4.7)
Depreciation and amortization of commercial real estate properties 9.5 10.6
Gain on the disposal of commercial real estate properties, net - -
FFO $22.3 $5.9
Exclude items not related to core business:
Land Operations Operating (Profit) (9.1) (4.0)
Materials & Construction Operating (Profit) Loss 1.9 6.9
Loss from discontinued operations 0.1 0.6
Income (loss) attributable to noncontrolling interest 0.2 -
Income tax expense (benefit) - -
Non-core business interest expense 3.1 3.7
Core FFO $18.5 $13.1
Partners for Hawai‘i Note: Additional information is included in the Company’s quarterly Supplemental Information report, which is furnished Alexander & Baldwin I NYSE: ALEX 34
to the SEC and available at www.alexanderbaldwin.com.CO RE FUNDS F RO M O PERAT IONS (CORE FFO)
RECONCILIATION OF CORE FFO STARTING FROM COMMERCIAL REAL ESTATE OPERATING PROFIT
DOLLARS IN MILLIONS
Three Months Ended Three Months Ended
June 30, 2021 June 30, 2020
CRE Operating Profit $18.6 $8.9
Depreciation and amortization of commercial real estate properties 9.5 10.6
Corporate and other expense (6.0) (2.3)
Core business interest expense (3.6) (4.1)
Core FFO $18.5 $13.1
Note: Additional information is included in the Company’s quarterly Supplemental Information report, which is furnished
to the SEC and available at www.alexanderbaldwin.com.
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 35CO NSOLIDAT ED
ADJUSTED EBITDA
RECONCILIATION OF CONSOLIDATED NET INCOME TO CONSOLIDATED ADJUSTED EBITDA
DOLLARS IN MILLIONS
TTM TTM
June 30, 2021 June 30, 2020
Net Income (Loss) $27.2 $(45.0)
Depreciation and amortization 51.3 54.5
Interest expense 28.4 31.5
Income tax expense (benefit) (0.3) (0.9)
Consolidated EBITDA $106.6 $40.1
Asset impairments related to the M&C segment - 55.3
Consolidated Adjusted EBITDA $106.6 $95.4
Note: Additional information is included in the Company’s quarterly Supplemental Information report, which is furnished
to the SEC and available at www.alexanderbaldwin.com.
Partners for Hawai‘i Alexander & Baldwin I NYSE: ALEX 36You can also read
