Investor Presentation February 2015

Transcription

1 Investor Presentation February

2 Forward-Looking Statements In addition to historical information, this presentation contains forward-looking statements under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Camden operates, management's beliefs, and assumptions made by management. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties which are difficult to predict. Factors which may cause the Company s actual results or performance to differ materially from those contemplated by forward-looking statements are described under the heading Risk Factors in Camden s Annual Report on Form 10-K and in other filings with the Securities and Exchange Commission (SEC). Forward-looking statements made in this presentation represent management s opinions as of the date of this presentation, and the Company assumes no obligation to update or supplement these statements because of subsequent events. 2

3 Outlook for Multifamily Industry Same property net operating income ( NOI ) projected above long-term trend for next several years Strong demand from: Growing Echo Boom population with high propensity to rent Large share of jobs going to the age cohort Pent-up demand from young adults living at home or with roommates Homeownership rate declining steadily and negative sentiment toward home ownership New supply still being met by strong demand Echo Boom Population Aged (millions) Favorable Demographics Trends* Over 60% of this age group choose to rent Year-Year Change in Employment (000) Young Adults Steadily Finding Employment* Annual Change in U.S. Population Aged (20-34) millions Pent-Up Demand From Young Adults Living At Home* Potential Pent-Up Moveouts from Home 1.4M more young adults than usual living with Estimated parents in 2013 Home Move-Backs *Source: Witten Advisors 3

4 Negative Sentiment Toward Home Ownership Many people choosing to rent rather than buy Moveout rates from apartment residents purchasing homes have declined dramatically (23% at peak vs. 14% in 2014 for Camden s portfolio) Strong credit scores and significant down payments now required by mortgage lenders Young adults carrying significant amount of student debt Share of U.S. Households Who Own Home 70% 69% 68% 67% 66% 65% 64% 63% 62% Homeownership Rate Continues to Decline 1Q90 4Q90 3Q91 2Q92 1Q93 4Q93 3Q94 2Q95 1Q96 4Q96 3Q97 2Q98 1Q99 4Q99 3Q00 2Q01 1Q02 4Q02 3Q03 2Q04 1Q05 4Q05 3Q06 2Q07 1Q08 4Q08 3Q09 2Q10 1Q11 4Q11 3Q12 2Q13 1Q14 4Q14 4Q14* 63.9% *Source: Witten Advisors seasonally adjusted homeownership rate 4

5 Manageable Levels of Supply Multifamily starts expected to peak in early 2015 then begin to decline Rising construction costs and interest rates make future development starts more challenging Single family rentals don t compete with well-located, amenity-rich apartment homes Multifamily Starts 5+ Rental Starts, trailing 12 months 350, , , , , ,000 50,000 Actual Starts Projected 0 1Q92 1Q93 1Q94 1Q95 1Q96 1Q97 1Q98 1Q99 1Q00 1Q01 1Q02 1Q03 1Q04 1Q05 1Q06 1Q07 1Q08 1Q09 1Q10 1Q11 1Q12 1Q13 1Q14 1Q15 1Q16 1Q17 Deficit of 450,000 starts from Source: Witten Advisors 5

6 Demand projected to exceed supply in most markets 2-year average ratio of estimated job growth to multifamily completions ( ) Long-term Equilibrium Ratio of 5:1 6 Ratio of Jobs to Completions 0.0 Las Vegas Orange County Phoenix Orlando Los Angeles Tampa San Diego Atlanta SE Florida Raleigh CPT Average Dallas Denver Charlotte Washington, DC Austin Houston Source: Witten Advisors and Axiometrics

7 Strategy & Portfolio 7

8 Camden s Strategy Maximize portfolio cash flow growth Create value through development and redevelopment Recycle capital through acquisitions and dispositions with minimal dilution Maintain strong balance sheet with low leverage 8

9 Camden s Operating Portfolio 166 communities 57,832 apartment homes 12 years Average age $1,247 4Q14 Average monthly rental rate per home 95.7% Same property occupancy (as of 2/22/2015) 9

10 Geographic Diversity & Market Balance Las Vegas 6.2% Denver 4.2% Washington, DC 16.5% LA/Orange County 6.6% San Diego/Inland Empire 3.8% Phoenix 3.7% Dallas 6.3% Austin 2.9% Houston 13.1% Corpus Christi 3.1% Atlanta 5.8% Tampa 6.6% Raleigh 4.2% Charlotte 4.9% Orlando 5.1% Southeast Florida 7.0% Percentage of NOI by Market 4Q14 Actual (Including pro-rata share of NOI from JV communities) 10

11 Growth Drives Results Top 25 Metro Areas For Estimated Gains: Employment Growth (in thousands) Rank Metro area Gain 1 New York-Wayne NY-NJ Houston-Baytown TX Los Angeles-Long Beach CA Dallas-Plano TX Atlanta-Sandy Springs GA Chicago-Naperville IL Phoenix-Mesa-Scottsdale AZ Seattle-Bellevue WA Orlando FL Austin-Round Rock TX Denver-Aurora CO Washington-Arlington DC-VA-MD-WV Minneapolis-St. Paul MN-WI Fort Worth-Arlington TX Santa Ana-Anaheim CA San Francisco-San Mateo CA San Diego-Carlsbad CA Tampa-St. Petersburg FL San Antonio TX Philadelphia PA Riverside-San Bernardino CA Miami-Miami Beach FL Las Vegas-Paradise NV Portland-Vancouver OR-WA San Jose-Sunnyvale CA Population Growth (in thousands) Over 96% of Camden s NOI is derived from these markets Rank Metro area Gain 1 Houston-Baytown TX Phoenix-Mesa-Scottsdale AZ Dallas-Plano TX Atlanta-Sandy Springs GA Los Angeles-Long Beach CA New York-Wayne NY-NJ Orlando FL Washington-Arlington DC-VA-MD-WV Riverside-San Bernardino CA Austin-Round Rock TX Fort Worth-Arlington TX Las Vegas-Paradise NV San Antonio TX Charlotte-Gastonia NC-SC Denver-Aurora CO San Diego-Carlsbad CA Seattle-Bellevue WA West Palm Beach-Boynton Beach FL Tampa-St. Petersburg FL Minneapolis-St. Paul MN-WI Fort Lauderdale-Pompano Beach FL Miami-Miami Beach FL Santa Ana-Anaheim CA Raleigh-Cary NC Chicago-Naperville IL Source: Moody s Analytics December 2014 Highlighted represents Camden markets 11

12 New Leases/Renewals Average change in same property new lease and renewal rates vs. expiring lease rates when signed 8% 6% 4% 2% 0% -2% 1Q14 2Q14 3Q14 4Q14 1Q15* *1Q15 Preliminary Data through 2/28/2015 New Leases Renewals 12

13 Rents Continue To Rise Average Monthly In-Place Rents (Camden s Same Property Portfolio) $1,240 $1,230 $1,227 $1,220 $1,210 $1,205 $1,200 $1,190 $1,188 $1,180 $1,175 $1,170 $1,160 1Q14 2Q14 3Q14 4Q14 13

14 Household Income Growing Average Household Income for Camden s Residents (Same Property Portfolio) $90,000 $88,000 $87,600 $86,000 $84,600 $84,000 $83,000 $82,000 $82,000 $80,000 1Q14 2Q14 3Q14 4Q14 14

15 Rent-to-Income Ratios Favorable Average Rent-to-Income Ratio for Camden s Residents (Same Property Portfolio) 18% 17% 17.2% 17.2% 17.1% 16.8% 16% 1Q14 2Q14 3Q14 4Q14 15

16 Same Property Occupancy (as of 2/22/15) 97% 96% 95% 94% 93% 16 Southeast Florida Dallas Charlotte Phoenix Las Vegas Southern California Denver Orlando Tampa Austin CPT Average Houston Raleigh Atlanta Washington, DC Occupancy by Market

17 4-Year Average Same Property Growth vs. Peers Revenue Growth ( Average) 8% 6% 4% 2% 0% ESS CPT EQR PPS AVB UDR AIV MAA AEC HME NOI Growth ( Average) 8% 6% 4% 2% 0% ESS CPT EQR AVB UDR PPS AIV HME MAA AEC Source: Company Financial Reports 17

18 2014 Reported Same Property Growth vs. Peers Revenue Growth (2014) 8% 6% 4% 2% 0% ESS CPT AIV UDR EQR AVB MAA HME PPS AEC NOI Growth (2014) 10% 8% 6% 4% 2% 0% ESS EQR AIV UDR CPT MAA AVB AEC PPS HME Source: Company Financial Reports 18

19 2015 Expected Same Property Growth vs. Peers Revenue Growth (Midpoint of Guidance Range) 8% 6% 4% 2% 0% ESS CPT AIV EQR AVB UDR MAA AEC HME PPS NOI Growth (Midpoint of Guidance Range) 10% 8% 6% 4% 2% 0% ESS AIV EQR UDR AVB CPT HME MAA AEC PPS Source: Company Financial Reports 19

20 2015 Guidance EARNINGS AS OF 1/28/2015 FFO per share $ $4.56 EPS per share $1.47- $1.67 SAME PROPERTY PERFORMANCE Revenue Growth 3.75% % Expense Growth 4.50% % NOI Growth 3.00% % Average Occupancy 95.2% TRANSACTIONS Acquisitions Dispositions Development Starts $100 - $300 million $100 - $300 million $100 - $300 million 20

21 Acquisitions, Dispositions & Development 21

22 2014/2015 Acquisition and Disposition Activity Year Total Average Monthly Purchase Closing Acquisitions Location Built Homes Rent per unit Price Date Camden Fourth Ward Atlanta, GA $1,587 $63M 10/29/2014 Year Total Average Monthly Sale Closing Dispositions Location Built Homes Rent per unit Price Date Camden River Atlanta, GA $1,011 $53M 11/10/2014 Camden Glen Lakes Dallas, TX $47M 11/18/2014 Camden Club Orlando, FL $52M 12/4/2014 Camden Lakeside Tampa, FL $22M 12/9/2014 Camden Pinehurst Charlotte, NC $45M 12/18/2014 Camden Ridgecrest Austin, TX $29M 1/15/2015 Camden Bayside Tampa, FL $85M 1/30/2015 Total ,963 $908 $333M Year Total Average Monthly Sale Closing Dispositions (JV) Location Built Homes Rent per unit Price Date Camden Braun Station San Antonio, TX $871 $22M 2/12/2014 Camden Piney Point Houston, TX ,211 $44M 2/27/2014 Total $1,099 $66M 22

23 Development Activity Completed and stabilized 11 communities with 3,098 apartment homes since 2011 Total cost of $494M Estimated value creation of $185M or $2.03 per share to NAV 15 communities currently under construction or in lease-up Total cost of $1.1B Estimated value creation of over $300M or $3.34 per share to NAV $543M additional projects in future development pipeline 23

24 Current Development Pipeline ($ in millions) Estimated Total Total Initial Construction Stabilized % Wholly-Owned Projects Location Homes Cost Occupancy Completion Operations Leased (1) Camden Boca Raton Boca Raton, FL 261 $52 3Q14 4Q14 3Q15 81% Camden La Frontera Round Rock, TX Q14 1Q15 4Q15 75% Camden Lamar Heights Austin, TX Q14 1Q15 4Q15 62% Camden Foothills Scottsdale, AZ Q14 4Q14 3Q15 55% Camden Flatirons Denver, CO Q14 2Q15 3Q16 42% Camden Paces Atlanta, GA Q14 3Q15 4Q16 31% Camden Hayden Tempe, AZ Q14 2Q15 3Q15 17% Camden Chandler Chandler, AZ Q15 1Q16 1Q17 5% Camden Glendale Glendale, CA Q15 3Q15 1Q16 - Camden Gallery Charlotte, NC Q15 1Q16 3Q16 - Camden Victory Park Dallas, TX Q15 1Q16 1Q18 - The Camden Los Angeles, CA Q16 4Q16 2Q17 - Camden Lincoln Station Denver, CO Q16 2Q17 1Q18 - Camden McGowen Station Houston, TX Q17 4Q17 1Q19 - Subtotal 4,430 $1,036 Joint Venture Project Camden Southline Charlotte, NC 266 $48 1Q15 3Q15 4Q15 6% Grand Total 4,696 $1,084 (1) As of 2/22/

25 Development Camden Boca Raton Boca Raton, FL Camden Foothills Scottsdale, AZ Camden La Frontera Round Rock, TX Camden Lamar Heights Austin, TX Camden Flatirons Denver, CO Camden Paces Atlanta, GA 25

26 Development Camden Hayden Tempe, AZ Camden Glendale Glendale, CA Camden Gallery Charlotte, NC Camden Chandler Chandler, AZ Camden Victory Park Dallas, TX The Camden Los Angeles, CA Camden Lincoln Station Denver, CO Camden McGowen Station Houston, TX Camden Southline (JV) Charlotte, NC 26

27 Future Development Projects ($ in millions) Total Projected Estimated Project Location Homes Cost Camden NoMa II Washington, DC 405 $116 Camden Shady Grove Rockville, MD Camden Buckhead Atlanta, GA Camden Conte I/II Houston, TX Camden Atlantic Plantation, FL Total 2,003 $543 27

28 Capital Structure & Liquidity 28

29 Strong Capital Structure ($ in millions as of 12/31/14) Equity* $6,735 Mortgages $906 Senior Unsecured Notes $1, x debt-to-ebitda 4.4% weighted average interest rate on all debt 92.4% fixed-rate debt 67.0% unsecured debt Unsecured Lines of Credit $0 Total Market Capitalization = $9.5 Billion 6.3 years weighted average maturity of debt Manageable debt maturities over next several years *Based on closing share price of $73.84 on 12/31/

30 Manageable Debt Maturities Future scheduled maturities excluding Line of Credit (as of 12/31/14) ($ in millions) $1,600 $1,400 $1,416.8 $1,200 $1,000 $800 $600 $400 $200 $0 $646.5 $251.8 $249.0 $177.4 $ Thereafter 30

31 Liquidity (as of 12/31/14) $500M availability under unsecured credit facilities $313M equity issuance available under ATM program Sufficient liquidity to meet near-term capital needs Unencumbered asset pool of approximately $6.0B 31

32 Summary 32

33 Why Camden? Experienced management team with proven history of performance and sound business plan Consistent long-term focus and commitment to high-growth markets Strong balance sheet with ample liquidity Well-positioned to capitalize on future opportunities Ranked #11 by FORTUNE Magazine as one of the 100 Best Companies to Work For in America 33

34 Definitions and Disclosures FFO The National Association of Real Estate Investment Trusts ( NAREIT ) currently defines FFO as net income (computed in accordance with accounting principles generally accepted in the United States of America ("GAAP")), excluding gains (or losses) associated with previously depreciated operating properties, real estate depreciation and amortization, impairments of depreciable assets, and adjustments for unconsolidated joint ventures. Our calculation of diluted FFO also assumes conversion of all potentially dilutive securities, including certain non-controlling interests, which are convertible into common shares. We consider FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions of operating properties, and depreciation, FFO can assist in the comparison of the operating performance of a company s real estate investments between periods or to different companies. Net Operating Income (NOI) NOI is defined by the Company as total property income less property operating and maintenance expenses less real estate taxes. The Company considers NOI to be an appropriate supplemental measure of operating performance to net income attributable to common shareholders because it reflects the operating performance of our communities without allocation of corporate level property management overhead or general and administrative costs. EBITDA EBITDA is defined by the Company as earnings before interest, taxes, depreciation and amortization, including net operating income from discontinued operations, excluding equity in (income) loss of joint ventures, (gain) loss on sale of unconsolidated joint venture interests, gain on acquisition of controlling interest in joint ventures, gain on sale of discontinued operations, net of tax, and income (loss) allocated to non-controlling interests. The Company considers EBITDA to be an appropriate supplemental measure of operating performance to net income attributable to common shareholders because it represents income before non-cash depreciation and the cost of debt, and excludes gains or losses from property dispositions. 34

35 Non-GAAP Reconciliations Expected FFO Expected FFO is calculated in a method consistent with historical FFO, and is considered an appropriate supplemental measure of expected operating performance when compared to expected earnings per common share (EPS). A reconciliation of the ranges provided for diluted EPS to expected FFO per diluted share is provided below: 2015 Range Low High Expected earnings per common share - diluted $1.47 $1.67 Expected real estate depreciation Expected adjustments for unconsolidated joint ventures Expected income allocated to non-controlling interests Expected FFO per share - diluted $4.36 $

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