Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - DUKE REALTY CORP | d8k.htm |
| EX-99.1 - PRESS RELEASE - DUKE REALTY CORP | dex991.htm |
 Duke
Realty Announces Major Transactions December 20, 2010
Exhibit 99.2 |
 2
Forward-Looking Statements
This slide
presentation
and
certain
of
our
other
filings
with
the
Securities
and
Exchange
Commission
contain
statements
that
constitute
“forward-looking
statements”
within
the
meaning
of
the
Securities
Act
of
1933 and the Securities Exchange Act of 1934 as amended by the Private Securities
Litigation Reform Act of 1995. These forward-looking statements
include, among others, our statements regarding (1) our differentiated
portfolio and market-specific asset strategy; (2) strategic initiatives with respect to our assets,
operations and capital; (3) our pro forma capital position following the execution
of the industrial joint venture acquisition; and (4) the assumptions
underlying our expectations. Prospective investors are cautioned that
any such forward-looking statements are not guarantees of future performance and involve
risks and uncertainties, and that actual results may differ materially from those
contemplated by such forward-looking statements. A number of
important factors could cause actual results to differ materially from those
contemplated by forward-looking statements in this slide presentation and our filings with the
Securities and Exchange Commission. Many of these factors are beyond our
ability to control or predict. Factors that could cause actual results
to differ materially from those contemplated in this slide presentation and
our filings with the Securities and Exchange Commission include the other factors set
forth in our filings with the Securities and Exchange Commission, including our
annual report on Form
10-K, quarterly reports on Form 10-Q and current reports on Form
8-K. We believe these forward- looking statements
are
reasonable,
however,
undue
reliance
should
not
be
placed
on
any
forward-looking
statements, which are based on current expectations. We do not assume any
obligation to update any forward-looking statements as a result of new
information or future developments or otherwise. |
 Asset
Strategy
Operations
Strategy
Capital
Strategy
Focused on executing our business strategy
3
Continued Progress On Strategic Initiatives
•
2010
Asset
dispositions
of
$630
million,
including
the
announced
joint
venture transaction with CB Richard Ellis Realty Trust (“CBRERT”) ($414
million proceeds to Duke Realty)
•
60% Office; 70% Midwest
•
Total acquisitions of $930 million, including announced $450 million South
Florida portfolio and $300 million Dugan Realty joint venture
•
78% Industrial; 22% Office
•
Strong leasing momentum: over 20 million square feet of new and renewal
leasing activity
•
Increasing occupancy; currently 89%
•
High tenant retention rate of 78.8%
•
Raised $1.2 billion of capital year-to-date; including disposition transactions
•
Bond tender/refinance of $280 million and repurchased $109 million shares
of preferred Series O
•
Approximately $770 million undrawn LOC; $21 million cash at 9/30/10
Note: Third Quarter Year to Date plus Pro forma effect of CBRERT and Premier transactions
|
 4
Asset Strategy: Overview
Portfolio by product type
September 30, 2009
Southeast
25%
Midwest
53%
West
1%
South
8%
East
13%
Southeast
30%
Midwest
40%
West
5%
South
10%
East
15%
Portfolio by region
Office
55%
Industrial
36%
Medical Office
5%
Office
25%
Industrial
60%
Medical Office
15%
After CBRERT and Premier
Industrial
42%
Office
49%
Retail 3%
Medical
Office 6%
Midwest
49%
Southeast
27%
South
11%
East
12%
West
1%
2013 Goal
Retail
4%
Strategic transactions reduce office concentration in Midwest and
increase industrial and medical office investment |
 5
Asset Strategy: Progress To Date
ACQUISITIONS
DISPOSITIONS
Q4 2009
$15
Q4 2009
$144
Q1 -
Q3 2010
479
Q1 -
Q3 2010
196
Q4 2010 –
Premier
450
Q4 2010 –
CBRERT
414
Proforma Total
$944
Proforma Total
$754
Progress to Date
Total Value
Assumed Debt
Net
Dispositions
$754
($0)
$754
Acquisitions
$944
($450)
$494
Excess Cash
$260
Significant progress on Asset Strategy with negligible effect on
current
earnings and positive growth profile on assets acquired
Less than 50 Bps
difference in Cap
Rates |
 6
Contribution to CBRERT Joint Venture
On December 15, 2010, Duke Realty announced an agreement to contribute $517
million of suburban office assets into its existing joint venture with CBRERT
First closing to be completed by December 31, 2010; value at $174 million
Remaining $343 million of assets contributed by end of second quarter 2011
Duke Realty will retain a 20% ownership interest
Consistent with long-term strategy of decreasing investment in suburban office
Reduces
suburban
office
concentration
from
55%
at
September
30,
2009
to
49%
(1)
Continued fee generation from asset management and other property related services
Generates capital that can be re-deployed into targeted acquisitions and deleveraging
Estimated proceeds of $414 million
Enhances relationship with a strategic Partner
Strategic disposition of suburban office in alignment with objectives
(1) Pro forma for both CBRERT and Premier transactions |
 7
Suburban Office Joint Venture Portfolio Overview
Geographic Footprint % Square Footage
Asset Snapshots
Minneapolis
( 17%)
Chicago
(7%)
Houston
(5%)
Dallas
(6%)
South Florida
(13%)
Cincinnati
(18%)
Columbus
(22%)
St. Louis
(8%)
Raleigh
(4%)
3.1 Million Square Feet
Pointe West I
Dallas
Norman Pointe I and II
Minneapolis
Sam Houston Crossing
Houston
One and Two Easton Oval
Columbus
Strategic contribution reduces office concentration in Midwest markets
Regency Creek I
Raleigh
One Conway Park
Chicago
533 and 555 Maryville Ctr
St. Louis
Landings Building I and II
Cincinnati
Nationwide
Columbus |
 8
On December 15, 2010, Duke Realty announced its agreement to acquire a $450 million
portfolio of primarily industrial properties from Premier Commercial Realty totaling over 4.9
million square feet located in South Florida
–
Portfolio is approximately 86% leased
Creates dominant industrial market position in Broward and Palm Beach counties
Acquisition is consistent with stated strategy
–
Increasing investment in high-growth, high barrier to entry industrial markets
–
Rapid deployment of proceeds from CBRERT joint venture transaction
–
Portfolio composition:
–
4.5 million square feet of industrial
–
400,000 square feet of office
Premier Realty Portfolio Acquisition
Attractive acquisition consistent with our strategy |
 Premier
Portfolio Overview Geographic Footprint
Asset Snapshots
Strategic acquisition of bulk industrial in high barrier markets
9
Premier Gateway Center @
Quantum
Premier Park of Commerce
Park Central Business Park
Sample 95 Business Park
Copans
Business Park
Westport Business Park
Atlantic Business Center
Crossroads Business Park
A
B
C
B
A
C
D
E
F
E
D
F
G
H
I
G
H
I
16%
14%
4%
8%
58%
Pompano Beach
Plantation
(office)
Boyton
Beach
Palm Beach
Central Broward
18%
3%
79%
Bulk
Industrial
Service Center
Office
Premier Airport Center |
 10
Our Goals
Our Targets to Obtain These Goals
•
Lower leveraged
•
Reduce to 45% leverage
Non-Strategic property and land sales
Increase portfolio occupancy to normalized
levels
•
Product focused
•
Increase bulk industrial investment
Industrial
>
60%
Office < 25%
Medical >15%
•
Concentrated in high
growth markets
•
Align investment and resources to high
growth markets; dispose/exit non-strategic
areas
Differentiated asset strategy within tighter
geographic focus
Vision Road Map: Future Duke Realty
The announced transactions are consistent with our vision
|