Kimco Realty Investor Day 2013
KIMCO INVESTOR DAY 2013
Agenda
Introduction
1:00 - 1:10pm
Milton Cooper, Executive Chairman
Kimco Strategy & Direction
1:10 - 1:25pm
Dave Henry, Vice Chairman, President and CEO
Shopping Center Portfolio Strategy
1:25 - 2:10pm
Conor Flynn, EVP and COO
Acquisition & Disposition Strategy
2:10 - 2:25pm
Scott Onufrey, Senior Vice President
Q&A
2:25 – 2:40pm
Dave Henry, Conor Flynn, Scott Onufrey
Break
2:40 – 2:55pm
Regional Leadership Panel
2:55 – 3:40pm
Kelly Smith, Managing Director, Canadian Operations
Rob Nadler, President, Central Region
Armand Vasquez, President, Western Region
Paul Puma, President, Southern Region
Tom Simmons, President, Eastern Region
The “Plus”
3:40 – 3:50pm
Ray Edwards,Vice President of Retailer Services
Financial Highlights & Strategy
3:50 – 4:15pm
Glenn Cohen, EVP, CFO, and Treasurer
Q&A
4:15 – 4:55pm
Dave Henry, Conor Flynn, Glenn Cohen
Summary & Closing
4:55 – 5:00pm
Dave Henry, Vice Chairman, President and CEO
2
SAFE HARBOR
The statements in this presentation, including targets and assumptions, state the Company’s
and management’s hopes, intentions, beliefs, expectations or projections of the future and are
forward-looking statements. It is important to note that the Company’s actual results could
differ materially from those projected in such forward-looking statements. Factors that could
cause actual results to differ materially from current expectations include the key assumptions
contained within this presentation, general economic conditions, local real estate conditions,
increases in interest rates, foreign currency exchange rates, increases in operating costs and
real estate taxes. Additional information concerning factors that could cause actual results to
differ materially from those forward-looking statements is contained from time to time in the
Company’s SEC filings, including but not limited to the Company’s report on Form 10-K.
Copies of each filing may be obtained from the Company or the SEC.
Westlake Shopping Center | Daly City, CA
3
Union Crescent Plaza | Union, NJ
Milton Cooper
Executive Chairman
4
Sunset Valley Marketfair | Austin,TX
David Henry
President and CEO
5
COMPANY SNAPSHOT
Largest Owner and Operator of Premier Shopping Centers in North America
History
Started in 1958 | IPO that initiated Modern REIT Era
NYSE listed (1991) | S&P 500 Index (2006)
Dividend
$0.90(1) annually, ~4.4% yield at 11/29/13
Retail Portfolio 841 properties totaling 123M sf
Footprint
42 States, Puerto Rico, Canada, Latin America
Occupancy(2)
Current: 94.1% | All-time high: 96.3% (12/31/07)
Credit Rating
Investment Grade: BBB+
S&P
Baa1
BBB+
Moody’s
Fitch
Note: Portfolio statistics as of 9/30/13 updated for subsequent acquisition and disposition activity through 11/30/13
(1) Reflects 7.1% dividend increase declared on 10/29/13
(2) Pro rata
Focused on Total Shareholder Return
6
TOTAL RETURN ANALYSIS
Total Return %
11.9%
11.5%
13.0%
11.0%
11.2%
6.1%
1 Year
3 Year
KIM
Since IPO
NAREIT Equity REIT Index
Source: Bloomberg
Historical Total Returns Exceed Equity REIT Index
7
KIMCO CHARACTERISTICS
Great
Properties
Great
People
• 41% of U.S. properties are located in
the top 10 MSAs
• Successful entrepreneurial culture
for over 50+ years
• Highly diversified portfolio
• Talented and experienced operating
team
‒ Across 42 States and 7 Canadian
provinces
‒ 58% grocery/food component
• Largest landlord for Costco, TJX,
Home Depot, Target, Ross Dress for
Less, Kohl’s, Walgreens and Dollar
Tree (1)
‒ 28 years average industry service
‒ Across 28 regional offices
• Industry-leading relationships with
deep local expertise
(1)
By ABR amongst our peer group: DDR, EQY, FRT, REG, and WRI.
Size & Scale Supported by Talented & Experienced Management Team
8
KEY MESSAGES
Kimco Has Executed on the “Back to Basics” Strategy
• Vastly improved the quality of our portfolio
• Monetized approximately $1B of Latin American assets
• Essentially exited all non-retail investments
• U.S. occupancy reaching 94%
• Grew pro-rata NOI to approximately $1B
• Improved balance sheet metrics (Net debt to recurring EBITDA 5.4x)
• Reducing joint ventures
Kimco Act II …The Transformation Continues
9
WE HAVE EXECUTED
Commitment: Focus on Retail
2008
Where We Were
2013
Where We Are
2014
Where We Are Going
17%
Non-retail
83%
Non-retail
98%
100% (1)
(1) Projection
based on materiality and subject to market conditions
By 2014, All Recurring Earnings Contributions Coming from Retail
10
THE CASE FOR RETAIL REAL ESTATE: TODAY’S MARKET
Supply Remains Historically Low…
Strip Center Supply Growth (GLA)
12%
10%
8%
6%
4%
2%
0%
Source: Green Street Advisors
11
THE CASE FOR RETAIL REAL ESTATE: TODAY’S MARKET
…And Retailers Continue to Expand
Retailer Planned Store Openings
Yearly Average
84,000
81,000
78,000
75,000
72,000
69,000
66,000
63,000
2009
2010
2011
2012
2013
YTD
• More than 81,000 store openings scheduled over the next two years(1)
• U.S. retail market occupancy increased with net absorption totaling 18.4M sf
during 3Q13(2)
(1) RBC
Capital Markets, “Retail REITs: November National Retailer Demand Monthly (NRDM)” November 2013
Group, “The CoStar Retail Report: National Retail Market” Third Quarter 2013
(2) CoStar
12
KIMCO PORTFOLIO: DIVERSIFIED BY TENANT (ABR)
3.0%
2.9%
2.4 %
1.8%
1.7%
1.6%
1.5%
1.4%
1.2%
1.1%
“A” Rated
• ~13,600 leases with 7,100
tenants
• Well-staggered lease maturity
with limited rollover in any
given year; averages ~8% over
next 10 years
Strong credit tenant base
• Top 20 publicly traded tenants
average YTD stock price
increase: > 47%
• 7 of the top 10 tenants are
investment grade
Solid Tenant Mix with Quality Credit
13
RETAILER BASE: MINIMAL EXPOSURE TO INTERNET
Portfolio Composition by ABR
92%
Internet
Resistant
Necessity-based,
Discount Goods
& Services
8%
Internet
Vulnerable
Books & Video
Office Supplies
Electronics
Diversified Portfolio: Strong Retailers with a Developed Omni-channel Presence
14
DI VERSIFIED BY GEOGRAPHY:
State
42 STATES AND 7 CANADIAN PROVINCES
Properties
SF(M)
ABR
California
107
18.4
13.5%
Florida
71
10.2
8.9%
New York
61
6.5
8.3%
Texas
50
7.3
4.8%
Pennsylvania
40
4.9
4.6%
New Jersey
27
4.1
4.2%
All Other U.S.
369
49.0
37.1%
Puerto Rico
7
2.2
3.2%
Canada
67
12.7
10.1%
799
115.3
94.7%
42
7.3
5.3%
841
122.6
100%
Subtotal U.S. & Canada
Latin America
Total
Note: Portfolio statistics as of 9/30/13 updated for subsequent acquisition and disposition activity through 11/30/13
Diversification Reduces Risk
15
THREE YEARS OF TRANSFORMATION…WHAT’S NEXT?
Kimco is Committed to Total Shareholder Return Plus by:
Transforming
Our Portfolio =
Great Assets in
Great Locations
Redeveloping &
Leveraging
Operational
Excellence
Simplifying
Our Business
Model
Creating Value Via
Opportunistic
Retail Activities;
THE “PLUS”
Simplification, Growth and Value Creation
16
KIMCO STRATEGY
• Acquiring high quality assets
‒ 73 U.S. shopping centers acquired for $1.8B since
2010 Investor Day
Transforming
Our Portfolio =
Great Assets in
Great Locations
‒ Concentrate on key markets where Kimco has
scale, physical presence, long standing relationships
and properties which possess strong demographics
‒ Focus on larger properties with potential for
additional redevelopment, entitlements, and value
creation
• Exiting non-core markets and lower quality/“at risk”
assets
‒ 139 U.S. shopping centers sold for $1.2B since
2010 Investor Day
Aggressive Efforts to Further Extract Value
17
KIMCO STRATEGY
•
Reducing JV platform; buying partner interests
accretively
‒ Acquired 12 JV properties for ~$541M
Simplifying
Our
Business
Continue
to
Model the
Simplify
Business
‒ Reduced the number of JV properties from
551 to 419 since 2010
•
Maintaining a strong balance sheet with an
investment grade credit rating
•
Monetizing Latin America assets
‒ South America: lack of scale & difficulty
achieving risk adjusted return
‒ Mexico: capital market activity providing
liquidity for a timely exit
Deliberate Approach to Becoming a More Focused Kimco
18
KIMCO STRATEGY: UPDATE ON LATIN AMERICA ASSET SALES
• What’s sold
‒ 26 shopping centers and 84 industrial
properties in Latin America for a gross price
of $1.08B
Simplifying
Our Business
Model
‒ Kimco share of proceeds: $348M
• What’s left: Net investment of $450M
‒ 5 properties in South America -- should be
completed by YE13
‒ 41 shopping centers remaining in Mexico –
26 in active negotiations and should be
completed in 1H14
‒ Finalizing a contract with a Mexican REIT to
sell 9 properties for a gross sales price of
~MXN2.0B (USD$154M)
Now Focused on U.S. and Canada
19
KIMCO STRATEGY: GROW NAV & EARNINGS
Redeveloping &
Leveraging
Operational
Excellence
•
Continue to increase occupancy
•
Growing redevelopment pipeline to $816M
•
Small shop lease-up
•
Embedded organic NOI growth (rent steps,
below market leases)
•
Opportunistic/accretive acquisitions
•
Continue to replace higher rate maturing debt
•
Strength of regional team
•
Leverage technology and sustainability to reduce
costs
Dependable Value Creation through Relentless Execution
20
KIMCO STRATEGY
• 50 years of relationships with retailers and
experience when opportunities arise
• Work directly with retailers on:
Creating Value Via
Opportunistic
Retail Activities;
THE “PLUS”
‒ Sale leasebacks
‒ Bankruptcy expertise
‒ Repositioning underperforming retail
locations
‒ Retail real estate financing
The “PLUS” That Further Enhances Returns
21
KIMCO IS POISED TO DELIVER ADDITIONAL VALUE…
• Aggressively transforming & simplifying portfolio  more focused footprint of
high quality assets
• Limited new retail supply plus strong retailer demand for space
• Significant value creation opportunities through:
‒ Expanding redevelopment pipeline
‒ Embedded NOI growth
‒ Retailer investments
‒ Dynamic and enterprising regional operating team
• Remain committed to increasing the dividend commensurate with FFO growth
…And Deliver a Strong Total Shareholder Return
22
Westlake S.C. | Daly City, CA
Conor Flynn
EVP and COO
23
UPDATE SINCE ASSUMING COO ROLE
• Previously served as President of Western Region
• Assumed COO position in May 2013
• Deep dive into the portfolio with a focus on growth
• Site visits; visited > 80% of portfolio
• Improved cross-regional communication: leverage, size, scale and experience
• Developed operating strategy to support long-term NOI growth of 3%+; acutely
focused on:
‒ Portfolio repositioning/quality enhancement
‒ Leasing initiatives and operating best practices
‒ Redevelopment: building a “war chest”
Supported by Strong Regional Operating Team
24
EXPERIENCED, DEEP OPERATIONAL TEAM
National Presence, Operating Locally
Tom Simmons, President
Eastern Region
251 Properties
GLA: 27.8M sf
Occupancy: 96.2%
Kelly Smith, Managing Dir.
Canada
67 Properties
GLA: 12.7M sf
Occupancy: 95.8%
Armand Vasquez, President
Western Region
188 Properties
GLA: 31.3M sf
Occupancy: 92.4%
Rob Nadler, President
Central Region
162 Properties
GLA: 22.2M sf
Occupancy: 96.2%
Paul Puma, President
Southern Region
131 Properties
GLA: 21.3M sf
Occupancy: 93.8%
Note: Amounts are shown on gross basis. Portfolio statistics as of 9/30/13 updated for subsequent acquisition and disposition activity through 11/30/13
Average 28 Years Experience with Local Market Expertise
25
U.S. RECYCLING RESULTS
Transformation of the Portfolio: Shifting Toward High Growth Markets
(1)
2010
2013
810
732
111,703
102,571
92.3%
94.5%
220 bps
Pro-rata ABR/sf
$11.62
$12.95
11.4%
Demographics
Average HHI
$79,975
$85,595
7.0%
Median HHI
$68,427
$72,325
5.7%
Estimated Population
106,117
108,926
2.6%
1,369
1,440
5.2%
Number of Properties
Gross GLA (000’s)
Portfolio Metrics
Pro-rata Occupancy
Household Density
Note: Demographics weighted by pro-rata ABR
(1)
Progress
Portfolio statistics as of 9/30/13 updated for subsequent acquisition and disposition activity through 11/30/13
Shift Has Resulted in Higher Quality Portfolio, Improved Operating Metrics
26
U.S. KEY TERRITORIES: FOCUSED ON DEMOGRAPHICS
GLA
ABR
Tot. Pop.
GLA
ABR
Tot. Pop.
1.3M sf
$14.0M
2.6M
GLA
ABR
Tot. Pop.
1.2M sf
$15.8M
3.3M
GLA
ABR
Tot. Pop.
3.1M sf
$29.9M
9.5M
MN
NY
5.3M sf
$86.7M
9.2M
GLA
ABR
Tot. Pop.
11.7M sf
$170.4M
20.5
GLA
ABR
Tot. Pop.
3.2M sf
$29.9M
4.3M
1.0M sf
$9.5M
2.4M
WA
4.9M sf
$66.5M
7.0M
OR
GLA
ABR
Tot. Pop.
GLA
ABR
Tot. Pop.
PA
IL
10.9M sf
$187.5M
30.3M
GLA
ABR
Tot. Pop.
13.1M sf
$192.6M
14.9M
GLA
ABR
Tot. Pop.
4.6M sf
$51.2M
6.8M
GLA
ABR
Tot. Pop.
10.2M sf
$117.4M
16.3M
WV VA
CO
CA
GLA
ABR
Tot. Pop.
MO
NC
AZ
SC
TX
GA
FL
GLA
ABR
Tot. Pop.
6.0M sf
$71.8M
17.0M
GLA
ABR
Tot. Pop.
2.0M sf
$14.7M
2.8M
GLA
ABR
Tot. Pop.
1.0M sf
$12.0M
5.4M
Median HHI in Our Key Territories is 11% Higher Than U.S. Average
27
HOW WE LOOK AT OUR PORTFOLIO: OPERATING METRICS
Site
Count
Total
GLA
Occupancy
%
Rent/
SF
Total NOI
%
Tier I Properties
533
51.5M
95.2%
$14.05
70%
Tier II Properties
108
11.9M
96.6%
$9.71
12%
Sale Candidates
91
8.1M
87.6%
$10.60
7%
U.S. Subtotal
732
71.5M
94.5%
$12.95
89%
Canada
67
7.0M
95.3%
$15.59
11%
78.5M
94.6%
$13.19
100%
North America Total 799
•
Tier 1 properties : Properties located in our key territories
•
Tier II properties: Long-term sale candidates (3 to 5 years)/properties outside key territories
•
Sale candidates: To be sold over next 1 to 3 years
Note: Amounts are shown on pro-rata basis. Portfolio statistics as of 9/30/13 updated for subsequent acquisition and disposition activity through 11/30/13
Tier I Makes Up 70% of NOI in North America
28
HOW WE LOOK AT OUR PORTFOLIO: DEMOGRAPHICS
Household
Density
Median
HHI
Average
HHI
Population
Tier I Properties
1,570
77,366
90,978
120,485
Tier II Properties
942
51,484
63,930
64,244
Sale Candidates
1,083
58,810
70,252
76,758
U.S. Subtotal
1,443
72,288
85,552
109,147
Canada
1,635
63,337
89,995
115,369
1,465
71,301
86,042
109,834
53,132
72,208
North America Total
U.S. Average
Note: Demographics based on a 3-mile radius weighted by pro-rata ABR for portfolio population as of 11/30/13
29
PORTFOLIO DISSECTION
Kimco Portfolio Metrics Compare Favorably to Peers
KIM
KIM
U.S.
Tier I
Portfolio Portfolio
Peer
Avg.(1)
U.S.
Shopping
Center
Average(2)
Average Population
109K
120K
101K
97K
Median Household Income
72K
77K
67K
67K
Average Gross Occupancy
94.6%
95.2%
94.5%
89.9%
Pro-rata ABR/sf
$12.95
$14.05
$17.40
$14.04
(1) Peers:
include FRT, REG, EQY, WRI & DDR
Green Street Advisors & Co-Star
KIM portfolio as of 11/30/13; KIM demographics based on a 3-mile radius weighted by pro-rata ABR
(2) Sources:
30
ABR DISSECTION
•
•
•
Insight #I:
Insight #2:
Insight #3:
Ground Lease Population Reduces Average ABR
Vintage Lease Population Reduces Average ABR
Ratio of Anchor to Non-Anchor GLA Reduces Average ABR
% of GLA
% of ABR
Rent/ SF
2013 Total Population
Impact of:
Ground Leases
100%
100%
$12.95
15%
11%
$9.53
Vintage Leases
17%
13%
$10.27
2013 Population Less Ground & Vintage
Leases
ABR
Impact
∆ = ($1.43)
$14.38
Tenant-Type Ratio of $14.38/sf: Anchor = 74% of GLA at $11.35/sf Average
31
ABR DISSECTION
Insight #4: Bias toward Highest Quality Anchors Correlates with Lower ABR
Peer Comparison
Credit Quality of Top 20 Tenants vs. Portfolio ABR
HIGH
% of
TOP 20
Tenants
Rated
“A”
LOW
KIM
12
D
10
DDR
8
WRI
6
EQY
4
$12.00
$14.00
LOWER
$16.00
REG
$18.00
ABR
FRT
$20.00
$22.00
$24.00
HIGHER
Source: S&P and Company Reports
32
CONTINUED PORTFOLIO STRENGTHENING
U.S. Occupancy Trend
Historical
All-Time
High
96.3% - 96.5%
93.9%
94.4%
93.1%
92.4%
4Q10
4Q11
4Q12
3Q13
4Q16 E
33
CONTINUED PORTFOLIO STRENGTHENING
New Leasing Spreads: KIM vs. Peer Average
20.2%
14.4%
21.6%
11.9%
13.6%
8.4%
9.3%
9.3%
4.5%
Trailing
4 Qtrs
Trailing
8 Qtrs
Trailing
12 Qtrs
KIM
Trailing
16 Qtrs
4.1%
Trailing
20 Qtrs
Peer Average
Source: Peer company documents
Peer group includes: FRT, REG, EQY, WRI, DDR and AKR
Data updated through 09/30/13
34
CONTINUED PORTFOLIO STRENGTHENING
Total Leasing Spreads: KIM vs. Peer Average
9.9%
8.6%
9.0%
6.8%
Trailing
4 Qtrs
Trailing
8 Qtrs
6.3%
5.4%
Trailing
12 Qtrs
KIM
4.5%
3.6%
Trailing
16 Qtrs
4.6%
3.6%
Trailing
20 Qtrs
Peer Average
Source: Peer company documents
Peer group includes: FRT, REG, EQY, WRI, DDR and AKR
Data updated through 09/30/13
35
EMBEDDED VALUE IN OUR PORTFOLIO
U.S. Portfolio
~ 10K Leases | 68M sf
Anchor Leases (≥ 10K sf)
Small Shop Leases (<10K sf)
•
~2,000 Leases, 53.4M sf
•
~8,000 Leases,14.7M sf
•
78% of occupied GLA, 62% of ABR
•
22% of occupied GLA, 38% of ABR
•
$10.13 Avg. rent / sf
•
$23.06 Avg. rent / sf
Anchor Value Creation: Driving Rental Growth & Improving Tenant Mix
• 97.4% occupied with limited new supply in the market
• Spread on new leases:
‒ Trailing 4 quarters: 53%+
‒ Trailing 12 quarters: 39%+
• Existing anchor leases = 59%+ spread on blended mark-to-market
• Nearly 20% of leases are 20 years or older: 77% below market
36
EMBEDDED VALUE IN OUR PORTFOLIO
Continued Upside for Anchor Spaces
• 10% of leases expiring through 2017 = 24%+ spread on mark-to-market
• Expiring leases through 2017 include:
‒ 5 Kmart leases; 253% below market
‒ 11 office supply leases; 37% below market
Notable 2014 Maturing Anchor Leases
• Renaissance Centre in FL: Whole Foods to replace Baer’s Furniture = 669%+ spread
• Bellmore S.C. in NY: National pet supply store to replace Rite Aid = 136%+ spread
• Westwood Plaza in SC: Regional grocer to replace Office Depot = 49%+ spread
37
EMBEDDED VALUE IN OUR PORTFOLIO
Runway to NOI through Small Shop Space
Small Shop Value Creation: Opportunity
• Current small shop occupancy = 84.7%; 360bps increase since 1Q 2011
• Small shop space occupancy target: 90% by 2016
• Equates to approximately $21M of new pro-rata annualized base rent
Small Shop Leasing Initiatives
• Implement bounty program for executed small shop leases with positive spreads
• “Clicks to Bricks” program: attracting web-based retailers to a “Bricks & Mortar”
location
• Small shop regional operator portfolio reviews
• Expanded marketing focus on service-oriented users (e.g. , quick-service
restaurants, urgent care, dental clinic, hair salons, etc.)
38
U.S. SAME-SITE NOI DRIVERS
Achieving 3-Year Average Same-Site NOI Growth: 3.0%+
Leasing
70 - 100 bps
•
•
•
•
Awaiting rent commencements
Renewals & options
Occupancy gains
Mark-to-market
Organic Growth
120 - 150 bps
•
•
•
•
Contractual rent bumps
Ancillary income
Percentage rent
Improving credit loss
Value Creation
60 - 100 bps
• Redevelopment
• Re-tenanting
• Pads/outlots
39
PROPERTY REDEVELOPMENT
Increasing Portfolio Value
• Aggressive pursuit of
redevelopment opportunities
within portfolio
Cottman & Bustleton Center | Philadelphia, PA
BEFORE
• Focus remains on Key Territories
and highly productive centers
• Potential for ground-up
development
AFTER
• Target ROI of >10%
‒ Total redevelopment yield
range of 8% - 16%
40
REDEVELOPMENT PIPELINE: ~$816M ($539M KIMCO SHARE)
Gross Costs by Stage ($MM)
Gross Costs by Project Type ($MM)
$326
$30
Redevelopments
$76
Active
Value Creation
Planning
Pads/Outlots
$710
Evaluation
$215
$275
Gross Costs by Estimated Year of Completion ($MM)
$323
$208
Gross Costs
Pro Rata Costs
$247
$249
$150
$115
Gross: $127M
$36 $27
2013
Future Costs
Pro-rata: $99M
2014
2015
2016 & Future
41
REDEVELOPMENT CASE STUDIES
COMPLETED
Westlake Shopping Center | Daly City, CA
42
OVERVIEW
Westlake Shopping Center | Daly City, CA
Gross
Costs
Incremental
NOI
ROI
Prior to Investor Day 2010
$79.0M
$8.8M
12%
Since Investor Day 2010
$1.8M
$0.6M
35%
• Added roadway through site, promoting vehicle and pedestrian traffic
• Expanded Safeway (8K sf) with over 50% increase in ABR/sf ($12/sf to $18.80/sf)
• Erected two parking structures, improved façade, signage, lighting and landscaping
• First national site to successfully offer vertical retailing to Home Depot and Cost
Plus World Market
• Increased GLA by 96K sf to 686K sf
Incremental Value Creation: $107.5M
43
Westlake Shopping Center | Daly City, CA
BEFORE
AFTER
44
Westlake Shopping Center | Daly City, CA
BEFORE
AFTER
45
OVERVIEW
Richmond Shopping Center | Staten Island, NY
Gross
Costs
Incremental
NOI
ROI
$4.6M
$2.2M
42%
• Redeveloped existing Kmart (102K sf) for new Target (142K sf) and added Miller's
Ale House (8K sf)
• Other new credit tenants added to the site include
complement existing tenants and form nice co-tenancies
• New tenancy coupled with updated exteriors throughout the center, including
Pathmark, have revitalized the site and improved the stability of the recurring NOI
and cap rate
Incremental Value Creation: $35.4M
46
Richmond Shopping Center | Staten Island, NY
BEFORE
AFTER
47
Richmond Shopping Center | Staten Island, NY
BEFORE
AFTER
48
REDEVELOPMENT CASE STUDIES
IN PROGRESS
Wilde Lake | Columbia, MD
49
OVERVIEW
Wilde Lake | Columbia, MD
Gross
Costs
Incremental
NOI
ROI
$17.9M
$1.5M
9%
• 250 residential rental units and retail redevelopment replacing a vacant food anchor
• Recaptured an old underutilized gas pad and will redevelop into new CVS
Pharmacy pad site
• Received building permits and planning board approval; Presently under
construction
• Redevelopment will be a LEED-certified project
Incremental Value Creation: $5.7M
50
Wilde Lake | Columbia, MD
BEFORE
AFTER
51
Wilde Lake | Columbia, MD
BEFORE
AFTER
52
OVERVIEW
Pompano Beach | Pompano, FL
Gross
Costs
Incremental
NOI
ROI
$10.9M
$1.2M
11%
• Property situated along major retail corridor in Pompano Beach
• Opportunistically terminated Kmart lease early to demolish building and redevelop
property
• Build-to-suit leases with Whole Foods (40K sf) and The Sports Authority (35K sf)
• Construction of both new stores will soon be underway
• Vacant outparcel restaurant was demolished and a new “People Dedicated to
Quality” (PDQ) restaurant was built ground-up in its place and is open for business
Incremental Value Creation: $9.9M
53
Pompano Beach | Pompano, FL
BEFORE
AFTER
54
Pompano Beach | Pompano, FL
BEFORE
AFTER
55
OVERVIEW
Cupertino Village | Cupertino, CA
Gross
Costs
Incremental
NOI
ROI
$16.0M
$1.2M
8%
Cupertino
Village
• Entitlements to build 23K sf (Retail A & B)
• Creation of three points of connectivity to the new Apple II Campus
• Redesigning interior courtyard and adding amenities, such as Wi-Fi, to create a
functional off-site work experience
• Upgrading the traditional town and country design to a more modern design
• Construct a two-story parking structure
• Broadening the national / regional retailers to diversify tenant mix beyond the
traditional Asian influence
Incremental Value Creation: $8.9M
56
Cupertino Village | Cupertino, CA
BEFORE
AFTER
Phase II not included
57
Cupertino Village | Cupertino, CA
BEFORE
AFTER
58
OVERVIEW
Fairview City Centre | Fairview Heights, IL
Gross
Costs
Incremental
NOI
ROI
$19.0M
$2.1M
11%
• Acquisition of ground lease position
• Recapture of Kmart lease and demolition of building
• Office Max downsize and relocation
• New Sports Authority, Fresh Thyme Farmers Market and Home Goods
• Upgrade of site improvements, landscaping and lighting
Incremental Value Creation: $8.7M
59
Fairview City Centre | Fairview Heights, IL
BEFORE
AFTER
60
Fairview City Centre | Fairview Heights, IL
BEFORE
AFTER
61
REDEVELOPMENT CASE STUDIES
FUTURE
Westwood Plaza| Charleston, SC
62
OVERVIEW
Westwood Plaza | Charleston, S.C.
Gross
Costs
Incremental
NOI
ROI
$7.8M
$0.8M
11%
• Redevelop shopping center currently anchored by TJ Maxx, Office Depot and
Barnes & Noble
• Located along the heavily trafficked Sam Rittenberg Parkway, minutes from
Charleston’s Historic District
• Relocate and right-size Office Depot, relocate TJX to the adjacent vacant box and
construct a new 50K sf supermarket adjacent to Barnes & Noble
• Renovate existing storefronts to be compatible with the new supermarket façade
along with the addition of a new parking field and lights
• Expected completion: 2015
Incremental Value Creation: Estimated $5.6M
63
Westwood Plaza | Charleston, S.C.
BEFORE
AFTER
64
Westwood Plaza | Charleston, S.C.
BEFORE
AFTER
65
OVERVIEW
Hylan Plaza | Staten Island, NY
Gross
Costs
Incremental
NOI
ROI
$26.6M
$2.4M
9%
• Full redevelopment based upon expiration of existing anchors in 2017
• Start entitlement process for full redevelopment in 2014
• Rare opportunity for large national anchor retailer to gain access to Staten Island
market with high barriers to entry
• National grocer and series of junior anchor boxes will be created to complement
shopping center
• Expected completion: 2019
Incremental Value Creation: Estimated $14.3M
66
Hylan Plaza | Staten Island, NY
BEFORE
AFTER
AFTER
67
Hylan Plaza | Staten Island, NY
BEFORE
AFTER
AFTER
68
SUMMARY
Intense Focus on Operational Execution
• Leasing, Leasing, Leasing: Anchor and small shop initiatives in place to drive
occupancy to new highs
• Transformation strategy well underway; focused on high quality assets in key
territories
• Disciplined approach to disposing assets; balanced approach to minimize dilution
• Significant redevelopment opportunity; large pipeline of additional value creation
Elevating Our Game and Aggressively Transforming Our Portfolio
69
Santee Trolley Square | Santee, CA
Scott Onufrey
Senior Vice President
70
ASSET ACQUISITIONS
A Refined Approach to Buying Great Assets
• Focus on 15 Key Territories
Santee Trolley Square, Santee, California
─ Consist of the largest MSAs in the U.S.
─ Markets where Kimco has scale and an
efficient operating platform
─ Local offices supply “boots on the ground”
• Low risk / high quality
• High barriers to entry
• Redevelopment potential with embedded growth
• Grocer, national big-box-anchored centers
• Strong tenancy and rollover opportunities
73 Properties ($1.8B) Acquired Since Investor Day 2010
71
ASSET ACQUISITIONS PROCESS
Diligent, Disciplined Approach…
Deals vetted by
Regional President,
Acquisition Officer,
COO and SVP
Detailed due
diligence performed
by independent risk
team
Deal presented to
Investment
Committee
Investment
Committee reviews
every deal
Deals > $100M
require BoD
approval
Asset
acquired
…Focused on High Quality with Exceptional Returns
72
ASSET DISPOSITIONS
A Systematic Approach to Upgrading the Portfolio
• Non-core properties located in secondary
and tertiary markets – operationally
inefficient
West Gates S.C., Rochester, New York
• Limited growth potential, higher risk
‒ CAGR < 1.5%
‒ Chronic vacancy > 10%
• Initiated aggressive recycling program in 2010
• 139 U.S. shopping centers have been sold for
$1.2B
• 91 identified as sale candidates today
Aggressive Approach to Dispositions Continues
73
REDUCING JV PARTNERSHIPS – SIMPLIFYING THE STORY
Kimco as Buyer - Benefits Serve Partners and Kimco
• Minimal due diligence costs and time to close
• Certainty of close for the partner
• Most secured debt on properties can be assumed quickly and inexpensively
• Negotiated transactions result in no / reduced brokerage commissions
• Property history and operation are well known by Kimco providing an excellent
fundamental understanding of the property for additional investment
• No additional overhead required associated with additional equity investment
Anticipate a Reduction of More Than 72 JV Properties in Two Years
74
REDUCING JV PARTNERSHIPS - SIMPLIFYING THE STORY
Achieved Significant Reductions in JV Portfolio Since 2010
Properties
551
$12.3B
Gross
Investment
Gross SF
419
$10.7B
2010
2013
83.4M
65.0M
Path Forward Promising…Excellent Reservoir of Opportunities
75
REDUCING JV PARTNERSHIPS - SIMPLIFYING THE STORY
What You Can Expect Going Forward
• We are committed to reducing our JV ownership structure over time
• Acquiring three grocery-anchored shopping centers from JV with LaSalle; one
property remains JV and will be dissolved during 2H14
• Potential for dividing assets among Kimco and partners and / or selling assets to
partners to facilitate process and focus on key territories
• Currently taking KIF I to market
‒ >$400M portfolio; Kimco owns 39.5%
‒ Kimco retains the right to bid
‒ 10 of 12 assets located in key territories
Opportunity Potential: $2B Over the Next 36 Months
76
RESULTS
Shift Has Resulted in Higher Quality Portfolio, Improved Operating Metrics
Acquisitions
Dispositions
73
139
9,587
14,471
Pro-rata Occupancy
95.7%
85.7%
1,000 bps
Pro-rata ABR/sf
$14.17
$8.91
59.0%
Average HHI
$92,884
$65,715
41.3%
Median HHI
$78,325
$58,143
34.7%
Estimated Population
92,523
75,734
22.2%
Household Density
1,273
1,047
21.6%
Number of Properties
Gross GLA (000s)
Progress
Portfolio Metrics
Demographics
Note: Demographics weighted by pro-rata ABR. Includes U.S. acquisition & disposition activity through 11/30/2013
More to Come During the Next Three Years
77
UPGRADING THE PORTFOLIO
ACQUIRED
SOLD
ACQUIRED
Westerville Plaza, Westerville, Ohio
(MSA: Columbus)
Santee Trolley Square, Santee, California
(MSA: San Diego-Carlsbad-San Marcos)
78
UPGRADING THE PORTFOLIO
SOLD
ACQUIRED
Woodforest S.C., Houston, Texas
(MSA: Houston-Sugar Land-Baytown)
Greeley Commons, Greeley, Colorado
(MSA: Greeley)
79
UPGRADING THE PORTFOLIO
SOLD
ACQUIRED
Salem Plaza, Trotwood, Ohio
(MSA: Dayton)
Shops at Kildeer, Kildeer, Illinois
(MSA: Chicago-Joliet-Naperville)
80
UPGRADING THE PORTFOLIO
SOLD
ACQUIRED
Mount Rose Plaza, York, Pennsylvania
(MSA: York-Hanover)
Dulles Town Crossing, Sterling,Virginia
(MSA: Washington-Arlington-Alexandria)
81
UPGRADING THE PORTFOLIO
SOLD
ACQUIRED
Kmart Plaza, Brunswick, Ohio
(MSA: Cleveland-Elyria-Mentor)
The Marketplace at Factoria, Bellevue, Washington
(MSA: Seattle-Tacoma-Bellevue)
82
UPGRADING THE PORTFOLIO
SOLD
ACQUIRED
Lafayette S.C., Lafayette, Indiana
(MSA: Lafayette)
Towson Place, Towson, Maryland
(MSA: Baltimore-Towson)
83
UPGRADING THE PORTFOLIO
SOLD
ACQUIRED
Value City S.C., Ottawa, Illinois
(MSA: Ottawa-Streator)
The Shops at District Heights, District Heights, Maryland
(MSA: Washington-Arlington-Alexandria)
84
UPGRADING THE PORTFOLIO
ACQUIRED
ACQUIRED
Centre Court, Pikesville, Maryland
(MSA: Baltimore-Towson)
Midtown Commons S.C., Knightdale, North Carolina
(MSA: Raleigh-Cary)
85
UPGRADING THE PORTFOLIO
ACQUIRED
ACQUIRED
Woodbridge S.C., Sugar Land, Texas
(MSA: Houston-Sugar Land-Baytown)
Grand Oaks Village, Orlando, Florida
(MSA: Orlando-Kissimmee-Sanford)
86
UPGRADING THE PORTFOLIO
ACQUIRED
ACQUIRED
Davidson Commons, Davidson, North Carolina
(MSA: Charlotte-Gastonia-Rock Hill)
Wexford Plaza, Pittsburgh, Pennsylvania
(MSA: Pittsburgh)
87
UPGRADING THE PORTFOLIO
ACQUIRED
ACQUIRED
City Heights Center, San Diego, California
(MSA: San Diego-Carlsbad-San Marcos)
Wilton River Park S.C., Wilton, Connecticut
(MSA: Bridgeport-Stamford-Norwalk)
88
UPGRADING THE PORTFOLIO
ACQUIRED
ACQUIRED
Hawthorn Hills Square, Vernon Hills, Illinois
MSA: Chicago-Joliet-Naperville
Columbia Crossing II, Columbia, Maryland
MSA: Baltimore-Towson
89
UPDATE ON RECENT DEALS
New England Portfolio Acquisition
• Contract to acquire a portfolio of 24 retail assets totaling 1.4M sf with assets in
Massachusetts (21), Connecticut (1) and New Jersey (2 )
• Purchase Price of $270M
• Rare opportunity to purchase portfolio located in a challenging-to-penetrate
market: Boston MSA
• Provides meaningful scale in a Top 10 MSA
• Strong CAGR due largely to contractual rent bumps in existing leases and
advancing below market rents as leases roll to market
• Excellent internal growth engine with significant long-term redevelopment
opportunities
Increased Presence in Key Territories
90
NEW ENGLAND PORTFOLIO
Brighton, Massachusetts
Danbury, Connecticut
Cambridge, Massachusetts
Medford, Massachusetts
Abington, Massachusetts
91
UPDATE ON PENDING DEALS
Selected Closed and Pending Transactions
• Recently completed the acquisition of two grocery and one drug-store-anchored
properties totaling $36M in the New York suburb of Clark, NJ
• Two assets under contract in Houston totaling $102M
• Two assets under contract in North Carolina totaling $123M (Charlotte & Raleigh)
• Pending partner buyout of three grocery-anchored properties in the BaltimoreWashington Corridor totaling $93M
92
Transformation…
…Roadmap to our
future portfolio
U.S. PORTFOLIO TRANSFORMATION
Investor Day 2010
 Sites Sold Since 2010
 Kimco Sites
Kimco Offices
MSA’s
Key Territories
94
U.S. PORTFOLIO TRANSFORMATION
Current Disposition Candidates

Sites Acquired

 Kimco Sites
Kimco Offices
MSA’s
Key Territories
95
U.S. PORTFOLIO TRANSFORMATION
Tier 1 and Tier II Properties
 Tier 1
 Tier II
Kimco Offices
MSA’s
Key Territories
96
U.S. PORTFOLIO TRANSFORMATION
Longer Term Portfolio Footprint – Tier 1
 Kimco Sites
Kimco Offices
MSA’s
Key Territories
A More Focused Kimco
97
SUMMARY
Portfolio Transformation Is Well Underway and Will Continue…
• Acquisition/disposition activity is producing results
‒ Focused geographies
‒ Larger assets
‒ Higher growth potential
‒ Stronger metrics
• JV buyout progress has been strong with more potential ahead
‒ Simplify our ownership structure
‒ Reduce mortgage debt
‒ Increase efficiency by consolidating invested capital into fewer assets
• Transformation and Simplification are leading to increased Total Shareholder Return
Investment Activity Geared Towards Portfolio Quality/Higher Multiple
98
Sunset Valley Marketfair | Austin,TX
Q&A
99
Centre Court | Pikesville, MD
Regional Overview
100
CANADA REGION – KELLY SMITH
Properties
Sq. Ft.
Occupancy
Acquired (since 2010)
Sold (since 2010)
67
12.7M
95.8%
6 sites (1.0M sf, $246.1M)
1 site (50K sf, $11.2M)
Macroeconomic Overview
Trends
• Stable economy with strong banking sector,
employment and population growth
• Recent consolidation: Loblaw, Sobeys,
Leons
• Triple A credit rating (one of few globally)
• Retailer expansion: Target, Nordstrom,
Saks, Cabela’s, Marshalls
• Budget surplus by 2014/15 (conservative
government estimate)
Opportunities
• Emergence: Outlet malls
Risks
• Limited supply/solid demand; cap rates
below 6% for grocery-anchored centers
• Downsizing: Staples and Best Buy store
closures (no impact to Kimco)
• Organic growth: lease bumps, lease-up and
density increases
• Sears continued unwinding/restructuring
• Potential to convert JV interests
101
CENTRAL REGION – ROB NADLER
Properties
Sq. Ft.
Occupancy
Acquired (since 2010)
Sold (since 2010)
162
22.2M
96.2%
13 sites (2.2M sf, $283.6M)
45 sites (7.0M sf, $503.5M)
Macroeconomic Overview
Trends
• Texas economy robust; leads nation in job
and population growth
• New construction gaining momentum
in Dallas/Fort Worth & Houston
• Chicago adding higher paying professional
jobs; 1.4% job growth in 2013
• Health care industry seeking traditional
retail locations
• Minneapolis-St. Paul employers on track for
25-year-high job growth
• Grocery competition heating up;
farmer’s market concepts well received
Opportunities
Risks
• Active redevelopment projects; expanding
pipeline of future projects
• Commodity-based retailers exposure to
e-commerce
• Significant junior anchor rent increases in
key submarkets amid strong sales and
limited relocation opportunities
• Consumer spending: region’s NOI
growth reliant on re-leasing spreads with
occupancy level above 96%
102
WESTERN REGION – ARMAND VASQUEZ
Properties
Sq. Ft.
Occupancy
Acquired (since 2010)
Sold (since 2010)
188
31.3M
92.4%
17 sites (2.7M sf, $587.1M)
26 sites (2.0M sf, $157.4M)
Macroeconomic Overview
• Large increases in home values in major
MSAs raising home equity
• Supply constraints continue to drive demand
in Bay Area, Seattle, Los Angeles & Portland
Opportunities
Trends
• Seattle: Growth in technology
companies continue to drive consumer
demand
• Los Angeles County: Improving job
growth & residential values
Risks
• Acquisition of privately owned outparcels
and adjacent centers
• Downsizing in office supply sector to
optimize square footage
• New retail concepts and adaptive uses
increase demand for retail space
• Consumers are still very walletconscious; continue to manage more
with less
103
SOUTHERN REGION – PAUL PUMA
Properties
Sq. Ft.
Occupancy
Acquired (since 2010)
Sold (since 2010)
131
21.3M
93.8%
20 sites (2.1M sf, $344.6M)
34 sites (3.4M sf, $266.5M)
Macroeconomic Overview
• Strong economic growth in key employment
sectors in most markets
• New housing starts and tourism are
trending up from the previous year
• Robust recovery in Florida & Southeast
Opportunities
• North & South Carolina: very attractive
market for major corporations
• Puerto Rico: tenant sales remain strong
with continued demand from national
retailers
Trends
• Retailer expansion: Bed Bath & Beyond,
Nordstrom Rack, Fresh Market, LA
Fitness
• Unemployment levels at or below the
national average
Risks
• Small shop exposure
• Increase in sales tax and Patente tax
(license to do business) in Puerto Rico
104
EASTERN REGION – TOM SIMMONS
Properties
Sq. Ft.
Occupancy
Acquired (since 2010)
Sold (since 2010)
251
27.8M
96.2%
23 sites (2.6M sf, $545.7M)
34 sites (2.0M sf, $220.9M)
Macroeconomic Overview
• Stable population & job growth
• Significant barriers to entry
• “Recession Proof” markets
Trends
• Cap rates well below national cap rates
for last eight quarters
• Fierce competition among grocery
tenants
• Continued shift from big box leasing to
small store leasing
Opportunities
• 4 of Top 10 MSAs in Eastern region: Boston,
NY Metro, Philadelphia & Wash./Balt.
Risks
• Downsizing: Staples & Office Depot
• Boston expansion
• Robust redevelopment pipeline
105
Westlake S.C. | Daly City, CA
Q&A
106
City Heights Center | San Diego, CA
Ray Edwards
Vice President, Retailer Services
107
CREDIT QUALITY
Proactive Monitoring Enables Kimco
to Get in Front of Issues
Proprietary
Watchdog Model
Inputs
Financo Credit
Monitor
U.S. Bad Debt As a % of Revenues
1.2%
1.1%
1.0%
Creditntell
0.9%
Credit Ratings
S&P
Fitch
Moody’s
Retailer Credit
Ranking System
(RCRS)
0.8%
0.7%
0.6%
Operating
Performance,
Financial Condition
Trend Analysis
Industry Trends
0.5%
2010
2011
2012
2013
Current Events
Credit Risk Management a Core Competency
108
WATCH LIST
Watch List for Top 50 Retailers (by ABR) Updated Monthly Based on RCRS ++
Centralized Monitoring
KIM Avg:
1.8
1.0
Excellent Credit
2.0
Good to Average Credit
Proactively Utilized by Management:
3.0
Watch; Monitor Closely
• Identify replacement tenants,
negotiate early terminations and
value creation opportunities
3.5
High Perceived Risk
• Greater acquisition due diligence
Watch List
Loss
Mitigation
Captures 54% of Portfolio by GLA
• Scrutinize lease renewals
4.0
Bankruptcy
• Limit tenant improvement packages
on new leases
Systematic Watch List Monitoring Process Provides Early Warning
109
KEY DIFFERENTIATOR: THE “PLUS”
Ability to Act Opportunistically with Retailer-Controlled Real Estate…
(Acquire/Release
to tenants)
(Designation
Rights)
(Acquire/Release to tenants)
(Acquire/Release to tenants)
Pre -1991
1995
1997
1998
(Designation
Rights)
(Real Estate Financing/ Designation
Rights)
(Real Estate Financing)
(Real Estate Financing)
2002
• Decades of retail property experience and
financial acumen resulting in solid track
record of unlocking real estate value for
retailers
• Current economic environment coupled with
strong retail relationships should continue to
yield profitable investment opportunities
2003
2005
(Consortium acquires
five grocery banners)
(Real Estate Financing)
(Acquire/Real Estate Financing)
2001
(Real Estate Financing)
(Privatization)
(Acquire/Reposition)
(Acquire/Sale Leasebacks)
(Acquire 60 leases)
(Bond Purchase)
2006
2007
2008
2013
• Remain focused on working directly with
retailers on:
‒ Sale leasebacks
‒ Bankruptcy transactions
‒ Repositioning underperforming retail
locations
‒ Retail real estate financing
…Has Led to Long History of Value Creation
110
VALUE CREATION CASE STUDY: ALBERTSONS -- 2006
Deal Background
SUPERVALU
• Acquired
core grocery
business
Kimco
Consortium
CVS
• Acquired 600
non-core
Albertsons
• CA, TX, FL
Kimco
Investment:
• $51M
• 13.5%
Stake
• Acquired
pharmacy
division
111
VALUE CREATION CASE STUDY: ALBERTSONS -- 2006
Deal Economics and Outcome
Turnaround
Story
•
•
•
•
•
•
•
•
Year 1
Hired Bob Miller as CEO
~125 unprofitable locations closed
N. California division sold to
SaveMart
Year 2
Sold 50% of FL stores to Publix
Cash
distributions
totaling $245M
or 483% from
2007 - 2012
Current Investment
13.6% ownership maintained
190+ store locations
No outstanding debt
Remaining book value: $0
Significant Embedded Value
The “PLUS”
112
CURRENT INVESTMENT: SUPERVALU (SVU) -- 2013
•
•
Partnered with consortium from original Albertsons deal
Two-step transaction
Transaction Step 1
•
Acquired five grocery banners; 877
properties for $3.3B
Transaction Step 2
•
Acquired 18% of SVU common stock
@ $4.11 share (as of 3/21/13)
‒ 8.2M SVU shares totaling $33.6M
•
•
•
416 owned/ground leased properties;
22.0M sf or ~$150/sf
SVU Stock Price: $6.45 (as of 11/29/13)
(1)
Unrealized Gain: ~$19M
Well below replacement cost (N. & S.
Cali., Chicago, Philly, Boston)
13.6% Investment: $37M
(1)
Subject to a 2-year lock-out
113
Union Crescent Plaza | Union, NJ
Glenn Cohen
EVP and Chief Financial Officer
114
TRANSFORMATION SINCE 2010
The Story: Steady FFO Growth with a Transforming Portfolio and Improved Balance Sheet
• We are “back to basics” and continue to simplify the business
‒ Focus is on U.S. and Canada retail real estate
‒ Completed sale of non-retail investments
‒ South America exit nearing completion; accelerating sale of Mexico assets
• Continued to shift mix toward higher quality assets in better markets
‒ Since 2010, transformed 20% of portfolio via divestitures (including non-retail) and
acquisitions
‒ Sold over $1.0B worth of shopping centers
• Intensified focus on operational efficiency and returns
• Accessed low-cost capital and improved capital structure
• Delivered consistent, predictable results
Significant Progress in All Operational Disciplines
115
A SUCCESSFUL THREE YEARS…AND MORE AHEAD
Recurring FFO Has Grown
at Steady 5% CAGR
$1.14
$1.26
$1.20
Consistently Raised Dividend Commensurate
with Recurring FFO/Share Growth
$0.84
$1.32 $1.33
$0.64
2010
2011
2012
2013
2010
$0.72
2011
$0.76
2012
2013
Key Success Drivers
• Simplification/focus on the core
• Portfolio transformation/improved asset quality
•
Increased operational efficiency
•
De-risked and lower-cost balance sheet
116
ACCESSED LOW COST CAPITAL AND REBALANCED CAPITAL STRUCTURE
• Issued $800M in perpetual preferred equity, replacing higher coupon perpetual preferred
• Refinanced over $1B of maturing debt at lower rates, maintaining a well-laddered maturity profile
• Since 2009, Kimco has NOT had a common equity issuance
6/30/10
9/30/13
Total Market Cap: $10.6B
Total Market Cap: $13.8B
6%
2%
8%
12%
7%
1%
Unsecured Debt
Mortgage Debt
52%
24%
60%
28%
Common Equity
Unsecured Debt
Preferred Stock
Non-controlling Interest
Equity Content
Mortgage Debt
117
EXCELLENT PROGRESS ON LEVERAGE
Net Debt Maintained at ~$4B While Recurring EBITDA Has Increased…
$735
Recurring
EBITDA
($MM)
~6% CAGR
$694
$646
$617
$590
$4.3
$3.9
$4.0
$4.1
$4.1
2009
2010
2011
2012
2013E*
7.3x
6.4x
6.2x
5.9x
12/31
Net Debt
($B)
5.6x
S&P: BBB+
Moody’s: Baa1
Fitch: BBB+
* 2013 Figures represent the midpoints of our ranges
…And at 5.5x – 6.0x Net Debt/Recurring EBITDA Range, We Are at Target Leverage Level
118
BALANCE SHEET METRICS
Investor Day
2010
Today
Debt/Market-cap
40.3%
31.8%
Net Debt/Gross Assets
36.4%
33.7%
Net Debt/Recurring EBITDA
6.6x
5.4x
Fixed Charge Coverage
2.4x
2.9x
Maintain Balance Sheet Strength
119
WELL-STAGGERED DEBT MATURITY PROFILE
Consolidated Debt
Weighted Avg. Fixed Rate: 5.34%
$MM
$1,200
Weighted Avg. Floating Rate: 2.08%
$900
17%
12%
$600
$300
20%
13%
12%
7%
2%
10%
6%
$2013
2014
2015
2016
2017
Secured
Unsecured
2018
Line of Credit
2019
2020
0%
2021
1%
2022
Thereafter
Unsecured Term Loan
JV Debt (1)
Weighted Avg. Fixed Rate: 5.38%
31%
$2,000
Weighted Avg. Floating Rate: 2.57%
$MM
$1,600
$1,200
17%
$800
$400
$-
8%
10%
1%
2013
2014
2015
8%
8%
2016
2017
Kimco Share
2018
3%
4%
2019
2020
Partner Share
2021
7%
2022
3%
Thereafter
Note: Percentages represent what is maturing as a % of the total debt stack as of 9/30/13
(1)
Kimco share of JV debt has been reduced from $2.9B to $2.2B since Investor Day in 2010
120
BALANCE SHEET STRATEGY
• Positioned to access capital at all times in multiple forms
• Preserve strong liquidity position; $1.75B available from unsecured line
of credit
• Repay maturing mortgage debt of over $600M by 2016; continue
increasing unencumbered asset pool of over 390 assets
• Maintain strong balance sheet metrics
‒ Net Debt to EBITDA, as adjusted: 5.5x – 6.0x
‒ Fixed charge coverage: 2.5x+
• Maintain strong investment grade ratings; stable outlook
‒ S&P: BBB+ | Moody’s: Baa1 | Fitch: BBB+
121
TOTAL SHAREHOLDER RETURN
Transformation Has Driven Solid Returns Since 2009
Total Shareholder Return(1)
1 Year
3 Year
Total to Date
12/31/09 – 12/31/10
12/31/09 – 12/31/12
12/31/09 – 10/31/13
39%
62%
64%
86%
28%
76%
71%
REIT
Avg.
S&P
500
36%
15%
KIM REIT Avg.S&P 500
KIM
KIM REIT Avg.S&P 500
KIM
NAREIT Equity Index
S&P 500
(1) Dividends
& Capital Appreciation
122
We are “Back”…
…So What’s Next?
123
GROWING NOI IN THE EXISTING PORTFOLIO
$1,115
($MM)
$3
$990
Canada $100
$3
$2
$2
$44
$30
U.S.
$795
$110
$925
$22
$34
U.S. &
Latin Am.
Sales
$95
2013
BASE
(Cancun to Cambridge)
($15)
Dilution
from
Asset
Sales
Organic
Growth/
Contractual
Rent Steps
Leasing
and
Lease-up
to 96.5%
Redev.
Pipeline
(2) Assumes
Additional
Acquisitions (1)
$80
(2)
2016E
(1) Acquisition NOI in addition to the reinvestment of sale proceeds
proceeds from U.S. & Latin America sales reinvested into new U.S. assets
124
RECURRING RETAIL EARNINGS GROWTH
($MM)
814
860
225
240
42
589
2010
620
2011
Consolidated Retail
~947
914
41
264
270
to
274
650
672
to
677
40
2012
2013E
JV Retail
~1064
233
to
245
~980
248
to
259
21
717
to
735
2
2014E
814
to
836
2016E
Non-Retail
Retail Contribution Expected to Be 100% by the End of 2014
125
GUIDANCE TRACK RECORD
Kimco Has Delivered Consistent, Predictable Results in Recent Years
2011 (1)
FFO,
As Adjusted
Per Share
SS NOI
Growth
Occupancy
Growth
2012
2014 (2)
2013
Guidance
Actual
Guidance
Actual
Guidance
Forecast
Guidance
$1.17 $1.21
$1.20
$1.22 $1.26
$1.26
$1.28 $1.33
~$1.32 1.33
$1.36 $1.40
0.0% 2.0%
1.6%
1.5% 3.5%
2.3%
2.5% 3.5%
~3.5%
2.50% 3.50%
+50 – 75
bps
+70
bps
+50 –
100
bps
+70
bps
+50 – 75
bps
~+50
bps
+50 – 75
bps
Delivered within Guidance Range
Guidance represents the initial guidance for each year
(1) U.S. only for same-site NOI & occupancy
(2) Same-site NOI & occupancy exclude Latin America
126
2014 FUNDS FROM OPERATIONS (FFO) GUIDANCE
FFO ($MM)
FFO/Share (2)
(3)
2013F
2014 Assumptions
(3)
2014F
2013F
2014F
$942 – $951
$965 – $994
$2.29 – $2.31
$2.34 – $2.41
20 – 23
1–4
0.05 – 0.06
0.00 – 0.01
Financing Costs
(273) – (275)
(266) – (272)
(0.66) – (0.67)
(0.64) – (0.66)
G&A
(126) – (128)
(122) – (127)
(0.31) – (0.31)
(0.30) – (0.31)
Other
(22) – (24)
(18) – (21)
(0.05) – (0.06)
(0.04) – (0.05)
$541 – $547
$560 – $578
$1.32 – $1.33
$1.36 – $1.40
29 – 29
0–0
0.07 – 0.07
0–0
$570 – $576
$560 – $578
$1.39 – $1.40
$1.36 – $1.40
(20) – (20)
0–0
(0.05) – (0.05)
0–0
$550 - $556
$560 - $578
$1.34 – $1.35
$1.36 – $1.40
Recurring:
Retail
Non-Retail
Total FFO, as Adjusted
Transactional Income, Net(1)
FFO Before Impairments
Impairments
FFO(2)
•
Acquisition of shopping
centers: $950M to
$1,100M (Kimco cash
contribution $675M to
$775M) (4)
•
Disposition of shopping
centers including Latin
America sales: $650M to
$750M (Kimco proceeds
$625M to $700M)
(1)
Includes normal course of business events such as outparcel sales, acquisition fees and other transactional events
Reflects the potential impact if certain units were converted to common stock at the beginning of the period
Reflects diluted per share basis
(4)
Difference between acquisition price and cash contribution reflects assumed debt
(2)
(3)
127
SOURCES & USES OF CAPITAL – NO COMMON EQUITY NEEDED
2013(1)
SOURCES ($MM)
Retail Portfolio Recycling Dispositions
2014 – 2016(1)
$690
$1,200
Non-Retail Dispositions
330
80
Debt Financings
640
2,100
FAD After Common Dividends
100
300
40
120
$1,800
$3,800
$815
$1,625
575
1,550
40
275
295
350
$1,725
$3,800
Excess/(Shortfall)
$75
$0
Net Debt/ Recurring EBITDA
5.6x
5.8x
Fixed Charge Coverage
2.9x
2.9x
~63%
~65%
Other
Total Sources
USES ($MM)
Consolidated Debt Repayment
Retail Portfolio Recycling Acquisitions
Development/Redevelopment
Other
Total Uses
Recurring FFO Payout %
(1)
2013 is a full-year projection, while 2014 – 2016 is a cumulative projection
128
SUMMARY
We Will Build on Our Successes and Continue to Drive Total Shareholder Return (“TSR”)
• Clear, compelling investment thesis
• Laser focus on what we do best – owning & operating
retail assets
• Strong execution at portfolio/property level
• Responsible, efficient capital structure providing strong
access to capital on multiple fronts
• Consistent, predictable results
Simple, Straightforward Value Creation
129
Santee Trolley Square | Santee, CA
Q&A
130
CLICK TO EDIT MASTER TITLE STYLE
• Click to edit Master text styles
‒ Second level
›
Third level
‒
Fourth level
‒ Fifth level
Airport Plaza | Farmingdale, NY
Closing Remarks
131
WHY KIMCO
1.
Largest owner & operator of shopping centers with 50 years of history
and retail expertise
2.
Strong balance sheet and related credit ratings with excellent liquidity
3.
Growth embedded in U.S. shopping center portfolio through leasing and
redevelopment
4.
Additional value creation via intense focus on active portfolio
management and capital recycling
5.
Proven opportunistic investor in retail real estate owned by U.S.
retailers - The “Plus”
Transforming, Simplifying and Redeveloping to Grow TSR
132
Wilton River Park S.C. | Wilton, CT
Appendix
SAFE HARBOR
The statements in this news release state the company's and management's intentions, beliefs, expectations or projections
of the future and are forward-looking statements. It is important to note that the company's actual results could differ
materially from those projected in such forward-looking statements. Factors which may cause actual results to differ
materially from current expectations include, but are not limited to (i) general adverse economic and local real estate
conditions, (ii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or a
general downturn in their business, (iii) financing risks, such as the inability to obtain equity, debt or other sources of
financing or refinancing on favorable terms to the company, (iv) the company’s ability to raise capital by selling its assets, (v)
changes in governmental laws and regulations, (vi) the level and volatility of interest rates and foreign currency exchange
rates, (vii) risks related to our international operations, (viii) the availability of suitable acquisition and disposition
opportunities, and risks related to acquisitions not performing in accordance with our expectations, (ix) valuation and
risks related to our joint venture and preferred equity investments, (x) valuation of marketable securities and other
investments, (xi) increases in operating costs, (xii) changes in the dividend policy for the company’s common stock, (xiii)
the reduction in the company’s income in the event of multiple lease terminations by tenants or a failure by multiple
tenants to occupy their premises in a shopping center, (xiv) impairment charges and (xv) unanticipated changes in the
company’s intention or ability to prepay certain debt prior to maturity and/or hold certain securities until maturity.
Additional information concerning factors that could cause actual results to differ materially from those forward-looking
statements is contained from time to time in the company's Securities and Exchange Commission (SEC) filings, including
but not limited to the company's Annual Report on Form 10-K for the year ended December 31, 2012. Copies of each
filing may be obtained from the company or the SEC.
The company refers you to the documents filed by the company from time to time with the SEC, specifically the section
titled "Risk Factors" in the company's Annual Report on Form 10-K for the year ended December 31, 2012, as may be
updated or supplemented in the company’s Quarterly Reports on Form 10-Q and the company’s other filings with the
SEC, which discuss these and other factors that could adversely affect the company's results.
134
RECONCILIATION OF FFO TO NET INCOME
2013F
(2)
(2)
2014F
2013F
2014F
FFO
$550 – $556
$560 – $578
$1.34 – $1.35
$1.36 – $1.40
Depreciation and amortization
(252) – (260)
(256) – (264)
(0.61) – (0.63)
(0.62) – (0.64)
Depreciation and amortization real estate JVs(1)
(122) – (130)
(118) – (126)
(0.30) – (0.32)
(0.29) – (0.31)
29 – 36
4 – 12
0.07 – 0.09
0.01 – 0.03
Gain on disposition of JV operating properties(1)
108 – 116
4 – 12
0.26 – 0.28
0.01 – 0.03
Impairments of operating properties, net of tax(1)
(145) – (145)
0–0
(0.35) – (0.35)
0–0
Net income available to common shareholders
$168 – $173
$194 – $212
$0.41 – $0.42
$0.47 – $0.51
Gain on disposition of operating properties
(1)
Net of non-controlling interests
Reflects diluted per share basis
Certain reclassifications of prior year amounts have been made to conform with the current year presentation
(2)
135