UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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FORM
CURRENT REPORT
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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Item 2.02. Results of Operations and Financial Condition
On February 10, 2022, Alpine Income Property Trust, Inc., a Maryland corporation (the "Company"), issued an earnings press release and an investor presentation relating to the Company’s financial results for the quarter and year ended December 31, 2021. Copies of the press release and investor presentation are attached hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by reference.
The information in Item 2.02 of this Current Report, including Exhibits 99.1 and 99.2 is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, unless it is specifically incorporated by reference therein.
Item 7.01. Regulation FD Disclosure
On February 10, 2022, the Company issued an earnings press release and an investor presentation relating to the Company’s financial results for the quarter and year ended December 31, 2021. Copies of the press release and investor presentation are attached hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by reference.
The furnishing of these materials is not intended to constitute a representation that such furnishing is required by Regulation FD or other securities laws, or that the materials include material investor information that is not otherwise publicly available. In addition, the Company does not assume any obligation to update such information in the future.
The information in Item 7.01 of this Current Report, including Exhibits 99.1 and 99.2 is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act or the Exchange Act, unless it is specifically incorporated by reference therein.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
99.1 Earnings Press Release dated February 10, 2022
99.2 Investor Presentation dated February 10, 2022
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: February 10, 2022
Alpine Income Property Trust, Inc.
By: /s/ Matthew M. Partridge
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
Press Release
Contact:Matthew M. Partridge
Senior Vice President, Chief Financial Officer & Treasurer
(386) 944-5643
mpartridge@alpinereit.com
FOR IMMEDIATE RELEASE | ALPINE INCOME PROPERTY TRUST REPORTS FOURTH |
DAYTONA BEACH, FL – February 10, 2022 – Alpine Income Property Trust, Inc. (NYSE: PINE) (the “Company” or “PINE”) today announced its operating results and earnings for the quarter and year ended December 31, 2021.
Select Highlights
| ◾ | Reported Net Income per diluted share attributable to the Company of $0.64 and $0.89 for the quarter and year ended December 31, 2021, respectively. |
| ◾ | Reported FFO per diluted share of $0.42 and $1.58 for the quarter and year ended December 31, 2021, respectively. |
| ◾ | Reported AFFO per diluted share of $0.41 and $1.59 for the quarter and year ended December 31, 2021, respectively. |
| ◾ | Acquired 26 net lease retail properties during the fourth quarter of 2021 for total acquisition volume of $101.6 million, reflecting a weighted average going-in cash cap rate of 6.2%. |
| ◾ | Sold two net lease office properties during the fourth quarter of 2021 for a sales price of $24.5 million at an exit cap rate of 7.5%, generating a gain on sale of $9.1 million. |
| ◾ | Paid a cash dividend for the fourth quarter of 2021 of $0.27 per share, a 5.9% increase over the Company’s previous quarterly cash dividend and an annualized yield of 5.6% based on the closing price of the Company’s common stock on February 9, 2022. |
| ◾ | During the year ended December 31, 2021, the Company acquired 68 net lease properties for total acquisition volume of $260.3 million, reflecting a weighted average going-in cash cap rate of 6.8%. |
| ◾ | During the year ended December 31, 2021, the Company sold three net lease properties for total disposition volume of $28.3 million at a weighted average exit cap rate of 7.2%, generating aggregate gains of $9.7 million. |
| ◾ | Paid cash dividends during the full year 2021 of $1.015 per share, a 23.8% increase over the Company’s full year 2020 cash dividends. |
Page 1
Quarterly Operating Results Highlights
The table below provides a summary of the Company’s operating results for the quarter ended December 31, 2021 (in thousands, except per share data):
|
| Three Months Ended December 31, 2021 |
| Three Months Ended December 31, 2020 | Variance to Comparable Period in the Prior Year | ||||
Total Revenues |
| $ | 9,470 |
| $ | 5,385 |
| $ 4,085 | 75.9% |
| | | | | | | | | |
Net Income |
| $ | 9,549 |
| $ | 216 |
| $ 9,333 | 4,320.8% |
Net Income Attributable to PINE |
| $ | 8,302 |
| $ | 186 |
| $ 8,116 | 4,363.4% |
Net Income per Diluted Share Attributable to PINE | $ | 0.64 |
| $ | 0.02 |
| $ 0.62 | 3,100.0% | |
| | | | | | | | | |
FFO (1) |
| $ | 5,443 |
| $ | 3,162 |
| $ 2,281 | 72.1% |
FFO per Diluted Share (1) |
| $ | 0.42 |
| $ | 0.36 |
| $ 0.06 | 16.7% |
AFFO (1) |
| $ | 5,365 |
| $ | 3,106 |
| $ 2,259 | 72.7% |
AFFO per Diluted Share (1) |
| $ | 0.41 |
| $ | 0.36 |
| $ 0.05 | 13.9% |
| | | | | | | | | |
Dividends Declared and Paid, per Share |
| $ | 0.270 |
| $ | 0.220 |
| $ 0.050 | 22.7% |
(1) | See the “Non-GAAP Financial Measures” section and tables at the end of this press release for a discussion and reconciliation of Net Income to non-GAAP financial measures, including FFO, FFO per diluted share, AFFO and AFFO per diluted share. |
Annual Operating Results Highlights
The table below provides a summary of the Company’s operating results for the year ended December 31, 2021 (in thousands, except per share data):
|
| Year Ended December 31, 2021 |
| Year Ended December 31, 2020 | Variance to Comparable Period in the Prior Year | ||||
Total Revenues |
| $ | 30,128 |
| $ | 19,248 |
| $ 10,880 | 56.5% |
| | | | | | | | | |
Net Income |
| $ | 11,462 |
| $ | 1,146 |
| $ 10,316 | 900.2% |
Net Income Attributable to PINE |
| $ | 9,964 |
| $ | 985 |
| $ 8,979 | 911.6% |
Net Income per Diluted Share Attributable to PINE | $ | 0.89 |
| $ | 0.11 |
| $ 0.78 | 709.1% | |
. | | | | | | | | | |
FFO (1) |
| $ | 17,726 |
| $ | 10,808 |
| $ 6,918 | 64.0% |
FFO per Diluted Share (1) |
| $ | 1.58 |
| $ | 1.23 |
| $ 0.35 | 28.5% |
AFFO (1) |
| $ | 17,904 |
| $ | 9,189 |
| $ 8,715 | 94.8% |
AFFO per Diluted Share (1) |
| $ | 1.59 |
| $ | 1.04 |
| $ 0.55 | 52.9% |
| | | | | | | | | |
Dividends Declared and Paid, per Share |
| $ | 1.015 |
| $ | 0.820 |
| $ 0.195 | 23.8% |
(1) | See the “Non-GAAP Financial Measures” section and tables at the end of this press release for a discussion and reconciliation of Net Income to non-GAAP financial measures, including FFO, FFO per diluted share, AFFO and AFFO per diluted share. |
Page 2
CEO Comments
“Our record fourth quarter capped off a very productive year as we exceeded our FFO and AFFO guidance, meaningfully grew our cash dividend, significantly increased the size and diversity of our high-quality net lease portfolio and provided one of the best total returns in the net lease REIT sector,” said John P. Albright, President and Chief Executive Officer of Alpine Income Property Trust. “We enter 2022 with excellent momentum, an outsized relative dividend yield and a robust acquisition pipeline that has us well-positioned to continue to drive strong growth and attractive risk-adjusted returns.”
Acquisitions
During the three months ended December 31, 2021, the Company acquired 26 high-quality net lease properties for total acquisition volume of $101.6 million, reflecting a weighted average going-in cash cap rate of 6.2%. As of the acquisition date, the properties had a weighted average remaining lease term of 8.1 years, were located in 11 different states, and were leased to tenants operating in 12 retail sectors including the sporting goods, home improvement, home furnishings, dollar stores, casual dining, convenience store and farm & rural supply sectors. Approximately 32% of annualized base rents acquired are generated from a tenant or the parent of a tenant with an investment grade credit rating and more than 34% of annualized base rents acquired are from ground leased properties.
During the year ended December 31, 2021, the Company acquired 68 net lease properties for total acquisition volume of $260.3 million, reflecting a weighted average going-in cash cap rate of 6.8%. As of the acquisition date, the properties had a weighted average remaining lease term of 8.1 years and were located in 26 different states. Approximately 37% of annualized base rents acquired are generated from a tenant or the parent of a tenant with an investment grade credit rating and more than 14% of annualized base rents acquired are from ground leased properties.
Dispositions
During the three months ended December 31, 2021, the Company sold two office properties located in Orlando, Florida leased to Hilton Grand Vacations for a sales price of $24.5 million, representing an exit cap rate of 7.5%. The sale of the properties generated a gain of $9.1 million.
During the year ended December 31, 2021, the Company sold three net lease properties for total disposition volume of $28.3 million, representing a weighted average exit cap rate of 7.2%. The sale of the properties generated aggregate gains of $9.7 million.
Development
During the year ended December 31, 2021, the Company signed a new store development lease with an established grocer to develop and construct a 23,000 square foot building on an undeveloped outparcel at one of the Company’s existing properties in Jacksonville, Florida (the “Development Opportunity”). The Development Opportunity will have an initial lease term of 15 years, is anticipated to begin construction in 2022 and is subject to customary due diligence and approvals.
Page 3
Income Property Portfolio
The Company’s portfolio consisted of the following as of December 31, 2021:
Number of Properties | 113 |
Square Feet | 3.3 million |
Weighted Average Remaining Lease Term | 7.9 years |
States where Properties are Located | 32 |
Occupancy | 100% |
| |
% of Annualized Base Rent attributable to Retail Tenants (1) | 92% |
% of Annualized Base Rent attributable to Office Tenants (1) | 8% |
% of Annualized Base Rent subject to Rent Escalations (1) | 45% |
% of Annualized Base Rent attributable to Investment Grade Rated Tenants (1)(2) | 45% |
% of Annualized Base Rent attributable to Credit Rated Tenants (1)(3) | 74% |
Any differences a result of rounding.
(1) | Annualized Base Rent (“ABR”) represents the annualized in-place straight-line base rent required by the tenant’s lease. ABR is a non-GAAP financial measure. We believe this non-GAAP financial measure is useful to investors because it is a widely accepted industry measure used by analysts and investors to compare the real estate portfolios and operating performance of REITs. |
(2) | The Company defines an Investment Grade Rated tenant as a tenant or the parent of a tenant with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Associated of Insurance Commissioners of Baa3, BBB-, NAIC-2 or higher. |
(3) | The Company defines a Credit Rated Tenant as a tenant or the parent of a tenant with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners. |
The Company’s portfolio included the following top tenants as of December 31, 2021:
Tenant | Credit Rating (1) |
| % of Annualized Base Rent |
Wells Fargo | A+ | | 8% |
At Home | B | | 6% |
Hobby Lobby | N/A | | 6% |
Academy Sports | B+ | | 5% |
Dollar General | BBB | | 5% |
Walmart | AA | | 4% |
Walgreens | BBB | | 4% |
Lowe’s | BBB+ | | 4% |
Dollar Tree/Family Dollar | BBB | | 3% |
Sportsman’s Warehouse | N/A | | 3% |
Total | | | 48% |
Any differences a result of rounding.
(1) | Credit rating is from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners, as applicable, as of December 31, 2021. |
Page 4
The Company’s portfolio consisted of the following industries as of December 31, 2021:
Industry |
|
| % of Annualized Base Rent |
Home Furnishings | | | 12% |
General Merchandise | | | 12% |
Sporting Goods | | | 9% |
Financial Services | | | 9% |
Dollar Stores | | | 8% |
Grocery | | | 6% |
Pharmacy | | | 6% |
Convenience Store | | | 5% |
Entertainment | | | 5% |
Home Improvement | | | 4% |
Consumer Electronics | | | 4% |
Casual Dining | | | 3% |
Health & Fitness | | | 3% |
Automotive Parts | | | 2% |
Off-Price Retail | | | 2% |
Specialty Retail | | | 2% |
Other (1) | | | 2% |
Farm & Rural Supply | | | 1% |
Quick Service Restaurant | | | 1% |
Office Supplies | | | 1% |
Total | 26 Industries |
| 100% |
Any differences a result of rounding.
(1) | Includes 7 industries collectively representing 2% of the Company’s ABR as of December 31, 2021. |
Page 5
The Company’s portfolio included properties in the following states as of December 31, 2021:
State |
|
| % of Annualized Base Rent |
Texas | | | 18% |
Oregon | | | 9% |
North Carolina | | | 8% |
Georgia | | | 6% |
Florida | | | 6% |
Ohio | | | 6% |
Arizona | | | 5% |
Michigan | | | 4% |
South Carolina | | | 3% |
Oklahoma | | | 3% |
Massachusetts | | | 3% |
New Jersey | | | 3% |
New Mexico | | | 3% |
Minnesota | | | 3% |
Washington | | | 2% |
Alabama | | | 2% |
New York | | | 2% |
Nevada | | | 2% |
Wisconsin | | | 2% |
West Virginia | | | 1% |
Maryland | | | 1% |
Missouri | | | 1% |
Mississippi | | | 1% |
Indiana | | | 1% |
Kentucky | | | <1% |
Maine | | | <1% |
South Dakota | | | <1% |
Kansas | | | <1% |
California | | | <1% |
Virginia | | | <1% |
Pennsylvania | | | <1% |
Arkansas | | | <1% |
Total | 32 States |
| 100% |
Any differences a result of rounding.
Page 6
Capital Markets and Balance Sheet
During the quarter ended December 31, 2021, the Company completed the following notable capital markets activities:
| ◾ | The Company issued 151,673 common shares under its ATM offering program at a weighted average gross price of $19.04 per share, for total net proceeds of $2.8 million. |
During the year ended December 31, 2021, the Company completed the following notable capital markets activities:
| ◾ | Executed a 5-year, $60.0 million unsecured term loan (the “2026 Term Loan”). The 2026 Term Loan matures in May 2026 and includes an accordion option that allows the Company to request additional lender commitments up to a total of $160.0 million. |
| ◾ | Assumed an existing $30.0 million secured mortgage, which bears a fixed interest rate of 4.33%, in connection with the acquisition of six properties from CTO Realty Growth, Inc., a publicly traded real estate investment trust and the sole member of the Company’s external manager. The mortgage note matures in October 2034 and is prepayable without penalty beginning in October 2024. |
| ◾ | Executed a 5-year, $80.0 million unsecured term loan (the “2027 Term Loan”). The 2027 Term Loan matures in January 2027 and includes an accordion option that allows the Company to request additional lender commitments up to a total of $200.0 million in the aggregate. |
| ◾ | Completed an inaugural follow-on underwritten public offering of 3,220,000 shares of common stock, which included the underwriters' full exercise of their option to purchase additional shares. Total net proceeds were $54.3 million after deducting the underwriting discount and expenses. |
| ◾ | Issued 479,640 OP Units at an $18.85 per OP Unit value for a total value of $9.0 million in connection with the acquisition of ten net lease properties. |
| ◾ | Issued 761,902 common shares under the ATM offering program at a weighted average gross price of $18.36 per share, for total net proceeds of $13.8 million. |
The following table provides a summary of the Company’s long-term debt as of December 31, 2021:
Component of Long-Term Debt | Principal | Interest Rate | Maturity Date | |||||
Revolving Credit Facility |
| $ | 99.0 million |
| 30-Day LIBOR + [1.35% - 1.95%] |
| November 2023 | |
2026 Term Loan (1) |
| $ | 60.0 million |
| 30-Day LIBOR + [1.35% - 1.95%] |
| May 2026 | |
2027 Term Loan (2) |
| $ | 80.0 million |
| 30-Day LIBOR + [1.25% - 1.90%] |
| January 2027 | |
Mortgage Note Payable – CMBS Portfolio |
| $ | 30.0 million |
| 4.33% |
| October 2034 | |
Total Debt/Weighted Average Rate |
| $ | 269.0 million |
| 2.10% |
|
|
|
(1) | Effective May 21, 2021, the Company utilized interest rate swaps to fix LIBOR and achieve a weighted average fixed interest rate of 0.81% plus the applicable spread on the $60.0 million 2026 term loan balance. |
(2) | Effective September 30, 2021, the Company utilized interest rate swaps, inclusive of its redesignation of the existing $50.0 million interest rate swap entered into as of April 30, 2020, to fix LIBOR and achieve a weighted average fixed interest rate of 0.53% plus the applicable spread on the $80.0 million 2027 term loan balance. |
Page 7
As of December 31, 2021, the Company held an 87.1% interest in Alpine Income Property OP, LP, the Company’s operating partnership (the “Operating Partnership” or “OP”). There were 1,703,494 OP Units held by third parties outstanding and 11,454,815 shares of the Company’s common stock outstanding, for total outstanding common stock and OP Units held by third parties of 13,158,309, as of December 31, 2021.
As of December 31, 2021, the Company’s net debt to Pro Forma EBITDA was 8.1 times, and as defined in the Company’s credit agreement, the Company’s fixed charge coverage ratio was 6.2 times. As of December 31, 2021, the Company’s net debt to total enterprise value was 49.6%. The Company calculates total enterprise value as the sum of net debt and the market value of the Company's outstanding common shares and OP Units, as if the OP Units have been converted to common shares.
Dividend
On November 22, 2021, the Company announced a cash dividend for the fourth quarter of 2021 of $0.27 per share, payable on December 30, 2021 to stockholders of record as of the close of business on December 9, 2021. The 2021 fourth quarter cash dividend represented a 5.9% increase over the Company’s previous quarterly dividend and a payout ratio of 64.3% and 65.9% of the Company’s 2021 fourth quarter FFO per diluted share and AFFO per diluted share, respectively.
During year ended December 31, 2021, the Company paid cash dividends of $1.015 per share, a 23.8% increase over the Company’s full year 2020 cash dividends. The dividends paid in 2021 represent payout ratios of 64.2% of full year 2021 FFO per diluted share and 63.8% of full year 2021 AFFO per diluted share.
2022 Outlook
The Company’s initial 2022 outlook assumes stable or improving economic activity, strong underlying business trends related to each of our tenants and other significant assumptions.
The Company’s outlook for 2022 is as follows:
| | Outlook Range for 2022 | ||
| | Low | | High |
Acquisitions |
| $200 million | to | $250 million |
Dispositions |
| $40 million | to | $50 million |
FFO per Diluted Share |
| $1.53 | to | $1.58 |
AFFO per Diluted Share |
| $1.51 | to | $1.56 |
Weighted Average Diluted Shares Outstanding |
| 17.0 million | to | 18.5 million |
Fourth Quarter 2021 Earnings Conference Call & Webcast
The Company will host a conference call to present its operating results for the quarter and year ended December 31, 2021 tomorrow, Friday, February 11, 2022, at 9:00 AM ET. Stockholders and interested parties may access the earnings call via teleconference or webcast:
Teleconference:
USA (Toll Free):1 (877) 815-0077
International: 1 (631) 625-3206
Page 8
Please dial in at least fifteen minutes prior to the scheduled start time and use the code 3796094 when prompted.
A webcast of the call can be accessed at: https://edge.media-server.com/mmc/p/mqy6ijb4. To access the webcast, log on to the web address noted above or go to http://www.alpinereit.com and log in at the investor relations section of the website.
About Alpine Income Property Trust, Inc.
Alpine Income Property Trust, Inc. (NYSE: PINE) is a publicly traded real estate investment trust that acquires, owns and operates a portfolio of high-quality net leased commercial income properties.
We encourage you to review our most recent investor presentation which is available on our website at http://www.alpinereit.com.
Safe Harbor
This press release may contain “forward-looking statements.” Forward-looking statements include statements that may be identified by words such as “could,” “may,” “might,” “will,” “likely,” “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “continues,” “projects” and similar references to future periods, or by the inclusion of forecasts or projections. Forward-looking statements are based on the Company’s current expectations and assumptions regarding capital market conditions, the Company’s business, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, the Company’s actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include general business and economic conditions, continued volatility and uncertainty in the credit markets and broader financial markets, risks inherent in the real estate business, including tenant defaults, potential liability relating to environmental matters, illiquidity of real estate investments and potential damages from natural disasters, the impact of the COVID-19 Pandemic and its variants on the Company’s business and the business of its tenants and the impact on the U.S. economy and market conditions generally, other factors affecting the Company’s business or the business of its tenants that are beyond the control of the Company or its tenants, and the factors set forth under “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and other risks and uncertainties discussed from time to time in the Company’s filings with the U.S. Securities and Exchange Commission. Any forward-looking statement made in this press release speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.
Non-GAAP Financial Measures
Our reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). We also disclose Funds From Operations (“FFO”) Adjusted Funds From Operations (“AFFO”), and Pro Forma Earnings Before Interest, Taxes, Depreciation and Amortization (“Pro Forma EBITDA”), all of which are non-GAAP financial measures. We believe these non-GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs.
FFO, AFFO, and Pro Forma EBITDA do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund cash requirements; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operations as reported on our statement of
Page 9
cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures.
We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. NAREIT defines FFO as GAAP net income or loss adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries.
To derive AFFO, we modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to non-cash revenues and expenses such as straight-line rental revenue, amortization of deferred financing costs, amortization of above- and below-market lease related intangibles, non-cash compensation, and other non-cash income. Such items may cause short-term fluctuations in net income but have no impact on operating cash flows or long-term operating performance. We use AFFO as one measure of our performance when we formulate corporate goals.
To derive Pro Forma EBITDA, GAAP net income or loss is adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries, non-cash revenues and expenses such as straight-line rental revenue, amortization of deferred financing costs, above- and below-market lease related intangibles, non-cash compensation, and other non-cash income or expense. Cash interest expense is also excluded from Pro Forma EBITDA, and GAAP net income or loss is adjusted for the annualized impact of acquisitions, dispositions and other similar activities.
FFO is used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers primarily because it excludes the effect of real estate depreciation and amortization and net gains or losses on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. We believe that AFFO is an additional useful supplemental measure for investors to consider because it will help them to better assess our operating performance without the distortions created by other non-cash revenues or expenses. We also believe that Pro Forma EBITDA is an additional useful supplemental measure for investors to consider as it allows for a better assessment of our operating performance without the distortions created by other non-cash revenues, expenses or certain effects of the Company’s capital structure on our operating performance. FFO, AFFO, and Pro Forma EBITDA may not be comparable to similarly titled measures employed by other companies.
Page 10
Alpine Income Property Trust, Inc.
Consolidated Balance Sheets
(In thousands, except share and per share data)
| As of | ||||
| December 31, 2021 |
| December 31, 2020 | ||
ASSETS |
|
|
| ||
Real Estate: |
|
|
|
|
|
Land, at Cost | $ | 178,172 |
| $ | 83,210 |
Building and Improvements, at Cost |
| 266,236 |
|
| 142,679 |
Total Real Estate, at Cost |
| 444,408 |
|
| 225,889 |
Less, Accumulated Depreciation |
| (15,419) |
|
| (6,550) |
Real Estate—Net |
| 428,989 |
|
| 219,339 |
Cash and Cash Equivalents |
| 8,851 |
|
| 1,894 |
Restricted Cash | | 646 | | | — |
Intangible Lease Assets—Net |
| 58,821 |
|
| 36,881 |
Straight-Line Rent Adjustment |
| 1,838 |
|
| 2,045 |
Other Assets |
| 6,369 |
|
| 2,081 |
Total Assets | $ | 505,514 |
| $ | 262,240 |
LIABILITIES AND EQUITY |
| |
|
|
|
Liabilities: |
| |
|
|
|
Accounts Payable, Accrued Expenses, and Other Liabilities | $ | 2,363 |
| $ | 1,984 |
Prepaid Rent and Deferred Revenue |
| 2,033 |
|
| 1,055 |
Intangible Lease Liabilities—Net |
| 5,476 |
|
| 3,299 |
Long-Term Debt |
| 267,740 |
|
| 106,809 |
Total Liabilities |
| 277,612 |
|
| 113,147 |
Commitments and Contingencies |
| |
|
|
|
Equity: |
| |
|
|
|
Preferred Stock, $0.01 par value per share, 100 million shares authorized, no shares issued and outstanding as of December 31, 2021 and December 31, 2020 |
| — |
|
| — |
Common Stock, $0.01 par value per share, 500 million shares authorized, 11,454,815 shares issued and outstanding as of December 31, 2021 and 7,458,755 shares issued and outstanding as of December 31, 2020 |
| 114 |
|
| 75 |
Additional Paid-in Capital |
| 200,906 |
|
| 132,878 |
Dividends in Excess of Net Income |
| (6,419) |
|
| (5,713) |
Accumulated Other Comprehensive Income (Loss) |
| 1,922 |
|
| (481) |
Stockholders' Equity |
| 196,523 |
|
| 126,759 |
Noncontrolling Interest |
| 31,379 |
|
| 22,334 |
Total Equity |
| 227,902 |
|
| 149,093 |
Total Liabilities and Equity | $ | 505,514 |
| $ | 262,240 |
Page 11
Alpine Income Property Trust, Inc.
Consolidated Statements of Operations
(In thousands, except share, per share and dividend data)
(Unaudited) Three Months Ended | Year Ended | ||||||||||
December 31, 2021 | December 31, 2020 | December 31, 2021 | December 31, 2020 | ||||||||
Revenues: | |||||||||||
Lease Income | $ | 9,470 | $ | 5,385 | $ | 30,128 | $ | 19,248 | |||
Total Revenues |
| 9,470 |
| 5,385 |
| 30,128 |
| 19,248 | |||
Operating Expenses: | | | | | |||||||
Real Estate Expenses | 1,284 | 611 | 3,673 | 2,316 | |||||||
General and Administrative Expenses | 1,340 | 1,125 | 5,027 | 4,660 | |||||||
Depreciation and Amortization |
| 5,025 |
| 2,946 |
| 15,939 | |
| 9,949 | ||
Total Operating Expenses |
| 7,649 |
| 4,682 |
| 24,639 |
| 16,925 | |||
Gain on Disposition of Assets | | 9,131 | | | — | | | 9,675 | | | 287 |
Net Income from Operations |
| 10,952 |
| 703 | 15,164 | 2,610 | |||||
Interest Expense | 1,403 | 487 | 3,702 | 1,464 | |||||||
Net Income |
| 9,549 |
| 216 |
| 11,462 |
| 1,146 | |||
Less: Net Income Attributable to Noncontrolling Interest | (1,247) | (30) | (1,498) | (161) | |||||||
Net Income Attributable to Alpine Income Property Trust, Inc. | $ | 8,302 | $ | 186 | $ | 9,964 | $ | 985 | |||
| | | | ||||||||
Per Common Share Data: | | | | | |||||||
Net Income Attributable to Alpine Income Property Trust, Inc. | | | | | |||||||
Basic | $ | 0.73 | $ | 0.02 | $ | 1.02 | $ | 0.13 | |||
Diluted | $ | 0.64 | $ | 0.02 | $ | 0.89 | $ | 0.11 | |||
Weighted Average Number of Common Shares: | | | | | |||||||
Basic | 11,347,778 | 7,458,755 | | 9,781,066 | | 7,588,349 | |||||
Diluted (1) | 13,051,272 | | 8,682,609 | | 11,246,227 | | 8,812,203 | ||||
| | | | ||||||||
Dividends Declared and Paid | $ | 0.270 | $ | 0.220 | $ | 1.015 | $ | 0.820 | |||
Page 12
Alpine Income Property Trust, Inc.
Non-GAAP Financial Measures
Funds From Operations and Adjusted Funds From Operations
(Unaudited)
(In thousands, except per share data)
| Three Months Ended |
| Year Ended | ||||||||
| December 31, 2021 |
| December 31, 2020 |
| December 31, 2021 |
| December 31, 2020 | ||||
Net Income | $ | 9,549 |
| $ | 216 |
| $ | 11,462 |
| $ | 1,146 |
Depreciation and Amortization |
| 5,025 |
|
| 2,946 |
|
| 15,939 |
|
| 9,949 |
Gain on Disposition of Assets | | (9,131) | | | — | | | (9,675) | | | (287) |
Funds from Operations | $ | 5,443 |
| $ | 3,162 |
| $ | 17,726 |
| $ | 10,808 |
Adjustments: | | |
| | |
| | |
|
| |
Straight-Line Rent Adjustment | | (214) |
| (287) |
| (607) |
| (1,524) | |||
COVID-19 Rent Repayments (Deferrals), Net | | 22 |
|
| 160 |
|
| 430 |
|
| (378) |
Non-Cash Compensation | | 78 |
|
| 67 |
|
| 309 |
|
| 268 |
Amortization of Deferred Financing Costs to Interest Expense | | 126 |
|
| 55 |
|
| 362 |
|
| 188 |
Amortization of Intangible Assets and Liabilities to Lease Income | | (89) |
| | (30) |
| | (257) |
| | (108) |
Other Non-Cash (Income) Expense |
| (1) |
|
| (12) |
|
| (18) |
|
| (22) |
Recurring Capital Expenditures |
| — |
|
| (9) |
|
| (41) |
|
| (43) |
Adjusted Funds from Operations | $ | 5,365 |
| $ | 3,106 |
| $ | 17,904 |
| $ | 9,189 |
|
| |
|
| |
|
| |
|
| |
FFO per Diluted Share | $ | 0.42 |
| $ | 0.36 |
| $ | 1.58 |
| $ | 1.23 |
AFFO per Diluted Share | $ | 0.41 |
| $ | 0.36 |
| $ | 1.59 |
| $ | 1.04 |
Page 13
Alpine Income Property Trust, Inc.
Non-GAAP Financial Measures
Reconciliation of Net Debt to Pro Forma EBITDA
(Unaudited)
(In thousands)
| Three Months Ended | |
| December 31, 2021 | |
Net Income | $ | 9,549 |
Adjustments: | | |
Depreciation and Amortization | | 5,025 |
Gain on Disposition of Assets | | (9,131) |
Straight-Line Rent Adjustment | | (214) |
Non-Cash Compensation | | 78 |
Amortization of Deferred Financing Costs to Interest Expense | | 126 |
Amortization of Intangible Assets and Liabilities to Lease Income | | (89) |
Other Non-Cash (Income) Expense | | (1) |
Interest Expense, Net of Deferred Financing Costs Amortization | | 1,278 |
EBITDA | $ | 6,621 |
| | |
Annualized EBITDA | $ | 26,484 |
Pro Forma Annualized Impact of Current Quarter Acquisitions and Dispositions, Net (1) | | 5,582 |
Pro Forma EBITDA | $ | 32,066 |
| | |
Total Long-Term Debt | | 267,740 |
Financing Costs, Net of Accumulated Amortization | | 1,260 |
Cash and Cash Equivalents | | (8,851) |
Restricted Cash | | (646) |
Net Debt | $ | 259,503 |
| | |
Net Debt to Pro Forma EBITDA | 8.1x | |
(1) | Reflects the pro forma annualized impact on Annualized EBITDA of the Company’s acquisition and disposition activity during the three months ended December 31, 2021. |
Page 14
Exhibit 99.2
| February 2022 INVESTOR PRESENTATION |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com COMPANY PROFILE 2 Ticker Symbol (NYSE) PINE Equity Market Capitalization 1 $254M Total Enterprise Value (TEV) $514M TEV Per Square Foot $157/foot Net Debt to TEV 2 50% Annualized Dividend Yield 5.6% % of Covering Analysts with a Buy or Outperform Rating 1 89% Common Shares & OP Units Outstanding 4 13.2M Number of Net Lease Properties 113 Number of States with a Property 32 Total Portfolio Square Feet 3.3M Current Occupancy 100% Annualized Base Rent (ABR) $36.9M % of ABR from Credit Rated Tenants 3 74% % of ABR from MSAs Over One Million People 5 63% % of ABR from Ground Leased Assets 9% Well - Positioned for Growth High - Quality, Resilient Net Lease Portfolio As of 12/31/2021, unless otherwise noted. 1. As of 2/8/2022. 2. Net debt to Total Enterprise Value is the Company’s outstanding debt, minus the Company’s cash, cash equivalents and restrict ed cash, as a percentage of the Company’s enterprise value. 3. A credit rated, or investment grade rated tenant (rating of BBB - , Baa3 or NAIC - 2 or higher) is a tenant or the parent of a tenan t with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners (NAIC). 4. As of 12/31/2021, there were 1,703,494 OP Units held by third parties outstanding in Alpine Income Property OP, LP, the Compa ny’ s operating partnership (the “Operating Partnership” or “OP”). 5. MSA, or metropolitan statistical area, is the formal definition of a region that consists of a city and surrounding communiti es that are linked by social and economic factors, as established by the U.S. Office of Management and Budget. |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com Payout Ratio % INVESTMENT HIGHLIGHTS 3 Meaningful Valuation Upside with In - Place Yield and Long - Term Growth As of 2/10/2022. $ in millions. 1. All dividend yields, payout ratios and 2022E FFO multiples are based on the closing stock price on February 8, 2022, using cu rre nt annualized dividends and 2022E FFO per share estimates for the peer net lease companies from the Stifel Triple - Net REITs Comp Sheets 2/6/2022 report. 2022E FFO per share for PINE is the midpo int of guidance, as provided on February 10, 2022. 2. Based on 2021 Average Household Income (5 - mile) and 2021 Total Population (5 - mile) data from Esri. Inflation Protection by Investing Below Replacement Cost PINE’s total enterprise value (TEV) is $157 square foot, allowing shareholders to invest below replacement cost in a portfolio rooted in higher growth, major markets throughout the United States. Significant Discount to Peer Group PINE trades at nearly half the 2022E FFO multiple as compared to the top peer, implying significant valuation upside. Stable & Attractive Dividend PINE has grown its quarterly dividend by 35% since the beginning of 2020 and now provides the highest dividend yield with one of the lowest implied payout ratios of its net lease peer group. Small Asset Base Provides Opportunity for Outsized Growth PINE has thoughtfully grown its portfolio by more than 250% since inception, focusing on high - quality real estate and well - performing tenants. 69% 5.6% FCPT O NTST STOR NNN SRC PINE ADC EPRT 2022E FFO Payout Ratio Dividend Yield 20.0x 17.4x 16.0x 15.8x 15.7x 14.4x 14.2x 12.5x 12.4x NTST O ADC EPRT FCPT STOR NNN SRC PINE $47 $75 $99 $117 $139 $220 $275 $377 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 2021 IPO Q4 2019 Cumulative Investment Activity Since IPO 2022E FFO Multiple 1 Avg Avg Total Enterprise Value of $157 per square foot $90,850 Total Portfolio Weighted Average 5 - Mile Average Household Income 2 166,500 Total Portfolio Weighted Average 5 - Mile Total Population 2 1 1 |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com FULL YEAR 2021 HIGHLIGHTS 4 2021 FFO Per Share 1 $1.58 Year - Over - Year FFO Growth 28% 2021 AFFO Per Share 1 $1.59 Year - Over - Year AFFO Growth 53% Q4 Quarterly Dividend Per Share $0.270 Q3 Quarterly Dividend Per Share $0.255 Q2 Quarterly Dividend Per Share $0.250 Q1 Quarterly Dividend Per Share $0.240 2021 Dividend Per Share Growth 23% Sector - Leading Earnings Growth Consistent Dividend Growth As of 12/31/2021. $ in millions, except per share data. 1. See the “Non - GAAP Financial Information” section and tables at the end of this presentation for a discussion and reconciliation of Net Income to non - GAAP financial measures. Contractual Base Rent Collections Portfolio Occupancy Q4 2021 100% Q4 2021 100% Q3 2021 100% Q3 2021 100% Q2 2021 100% Q2 2021 100% Q1 2021 100% Q1 2021 100% Scaling Investment Platform Reliable & Defensive Portfolio Acquisitions Volume Cash Cap Rate Q4 2021 $101.6 6.2% Q3 2021 $55.4 6.8% Q2 2021 $81.3 7.3% Q1 2021 $21.9 8.2% |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com 20.0x 17.4x 16.0x 15.8x 15.7x 14.4x 14.2x 12.5x 12.4x NTST O ADC EPRT FCPT STOR NNN SRC PINE SIGNIFICANT IMPLIED VALUATION UPSIDE 5 As of 2/10/2022. 1. All 2022E FFO multiples are based on the closing stock price on February 8, 2022, using current annualized dividends and 2022 E F FO per share estimates for the peer net lease companies from the Stifel Triple - Net REITs Comp Sheets 2/6/2022 report. 2022E FFO per share for PINE is the midpoint of guidance, as provided on Fe bruary 10, 2022. 2022E FFO Multiple 1 Peer Average 15.7x PINE trades at a 3.3x valuation discount to the peer group average, implying significant upside |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com 69% 5.2% 4.4% 3.7% 5.1% 4.9% 5.6% 5.6% 4.3% 4.1% FCPT O NTST STOR NNN SRC PINE ADC EPRT 2022E FFO Payout Ratio Dividend Yield RELATIVE OUTSIZED IN - PLACE DIVIDEND YIELD 6 As of 2/10/2022. 1. All dividend yields and payout ratios are based on the closing stock price on February 8, 2022, using current annualized divi den ds and 2022E FFO per share estimates for the peer net lease companies from the Stifel Triple - Net REITs Comp Sheets 2/6/2022 report. 2022E FFO per share for PINE is the midpoint of guidance , as provided on February 10, 2022. 2022E FFO Dividend Payout Ratio % Peer Average 4.7% PINE’s dividend is strongly supported by a conservative payout ratio and a portfolio built with an intense focus on real estate fundamentals and long - term stability .. 1 1 |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com DISCIPLINED INVESTMENT STRATEGY 7 Emphasizing Attractive Supply/Demand Market Dynamics National focus, with an emphasis on major metropolitan statistical areas that exhibit attractive population trends, business - friendly policies and strong underlying supply/demand fundamentals Real Estate Fundamentals and Analytics Driven Underwriting Real estate oriented underwriting utilizing consumer location data analytics, competition indexing, market rent benchmarking and comprehensive risk assessments Industry - Leading Tenants and Well - Performing Operating Sectors Focused on aligning with tenants operating in essential business sectors, displaying stable and resilient operating trends and/or a forward - thinking, omni - channel strategy Relative Asset Value Investing Through Long - Term Relationships Concentrated on relative value - investing through deep broker, developer and tenant relationships and management’s ability to identify high - quality risk - adjusted opportunities in a highly fragmented transaction market |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com ACCELERATING INVESTMENT EXECUTION 8 $ in millions. 1. Portfolio Growth represents the aggregate gross purchase price of the assets in the portfolio as of December 31, 2021, compar ed to the aggregate gross purchase price of the assets in the portfolio as of December 31, 2019. $47 $75 $99 $117 $139 $220 $275 $377 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 2021 IPO Q4 2019 Cumulative Investment Activity Since IPO More than 250% Accretive Portfolio Growth 1 Since Inception (24 months) PINE has consistently invested in high - quality net leased properties, with a focus on industry - leading tenants and essential business sectors, driving outsized risk - adjusted returns and positioning its portfolio for long - term value creation .. |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com IMPROVING PORTFOLIO SIZE & DIVERSITY 9 2019 (IPO) As of 12/31/2021. 1. A credit rated, or investment grade rated tenant (rating of BBB - , Baa3 or NAIC - 2 or higher) is a tenant or the parent of a tenan t with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners (NAIC). Number of Net Lease Properties 20 48 113 Number of States with a Property 12 18 32 Total Portfolio Square Feet 0.9M 1.6M 3.3M Occupancy 100% 100% 100% Annualized Base Rent (ABR) $13.3M $21.1M $36.9M Top Tenant as a % of ABR 21% Wells Fargo (S&P: A+) 15% Wells Fargo (S&P: A+) 8% Wells Fargo (S&P: A+) Top Sector as a % of ABR 21% Financial Services 15% General Merchandise 12% Home Furnishings Top State as a % of ABR 26% Florida 21% Florida 18% Texas % of ABR from Credit Rated Tenants 1 89% 83% 74% 2020 2021 |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com MAJOR MARKET NET LEASE PORTFOLIO 10 As of 12/31/2021. 1. MSA, or metropolitan statistical area, is the formal definition of a region that consists of a city and surrounding communiti es that are linked by social and economic factors, as established by the U.S. Office of Management and Budget. The names of the MSA have been shortened for ease of reference. 2. As ranked by Urban Land Institute & PWC in the ‘2022 Emerging Trends in Real Estate’ publication. > 10% 5% - 10% 2% - 5% < 2% ▪ Southeast and Southwest weighted portfolio, benefitting from population shifts and attractive supply/demand dynamics ▪ 63% of ABR comes from metropolitan statistical areas 1 with more than one million people ▪ 43% of ABR comes from the high - growth states of Florida, Texas, North Carolina, Arizona and Georgia ▪ 40% of ABR comes from Urban Land Institutes Top 30 Markets 2 % of Annualized Base Rent By State Houston, TX 11% Portland, OR 9% Atlanta, GA 5% Phoenix, AZ 5% Detroit, MI 4% Dallas, TX 4% Boston, MA 3% Canton, OH 3% Philadelphia, PA 3% Albuquerque, NM 3% Tampa, FL 3% Jacksonville, FL 2% Tulsa, OK 2% Seattle, WA 2% Duluth, MN 2% Charlotte, NC 2% Raleigh, NC 2% Reno, NV 2% Dayton, OH 2% Columbia, SC 2% Austin, TX 2% Whitewater, WI 2% Florence, SC 2% Winston - Salem, NC 2% Asheville, NC 1% Denotes a MSA with over one million people; Bold denotes a Top 30 ULI Market 2 |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com EXCELLENT PORTFOLIO DEMOGRAPHICS 11 As of 12/31/2021. 1. MSA, or metropolitan statistical area, is the formal definition of a region that consists of a city and surrounding communiti es that are linked by social and economic factors, as established by the U.S. Office of Management and Budget. The names of the MSA have been shortened for ease of reference. 2. As ranked by Urban Land Institute & PWC in the ‘2022 Emerging Trends in Real Estate’ publication. 3. Based on 2021 Average Household Income (5 - mile) and 2021 Total Population (5 - mile) data from Esri. Total Portfolio Weighted Average 5 - Mile Average Household Income 3 $90,850 ▪ 50% of portfolio ABR comes from the top 10 MSAs 1 , with the majority coming from the high - growth markets of Houston, Atlanta, Phoenix, Dallas and Boston ▪ Properties in the top 10 MSAs have a weighted average 5 - mile average household income of $101,000 3 ▪ Properties in the top 10 MSAs have a weighted average 5 - mile total population of 219,000 people 3 Houston, TX 11% Portland, OR 9% Atlanta, GA 5% Phoenix, AZ 5% Detroit, MI 4% Dallas, TX 4% Boston, MA 3% Canton, OH 3% Philadelphia, PA 3% Albuquerque, NM 3% Tampa, FL 3% Jacksonville, FL 2% Tulsa, OK 2% Seattle, WA 2% Duluth, MN 2% Charlotte, NC 2% Raleigh, NC 2% Reno, NV 2% Dayton, OH 2% Columbia, SC 2% Austin, TX 2% Whitewater, WI 2% Florence, SC 2% Winston - Salem, NC 2% Asheville, NC 1% Denotes a MSA with over one million people; Bold denotes a Top 30 ULI Market 2 Total Portfolio Weighted Average 5 - Mile Total Population 3 166,500 |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com HOUSTON GROUND LEASE PORTFOLIO 12 1. MSA, or metropolitan statistical area, is the formal definition of a region that consists of a city and surrounding communiti es that are linked by social and economic factors, as established by the U.S. Office of Management and Budget. The names of the MSA have been shortened for ease of reference. 2. Based on 2021 Average Household Income (5 - mile) and 2021 Total Population (5 - mile) data from Esri. 3. A credit rated, or investment grade rated tenant (rating of BBB - , Baa3 or NAIC - 2 or higher) is a tenant or the parent of a tenan t with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners (NAIC). ▪ Nine properties spread across more than 26 acres in a heavily trafficked, affluent submarket in the Houston MSA 1 o Excellent visibility along I - 45 (146,486 vehicles per day) and Bay Area Boulevard (36,184 vehicles per day) ▪ 48% of ABR comes from investment grade rated tenants 3 ▪ Over 200,000 people in a 5 - mile radius 2 ▪ Nearby retailers include Costco, Apple, HEB, Dick’s Sporting Goods, Best Buy, Lifetime Fitness, Hobby Lobby & HomeGoods ▪ Ground lease structure means the tenants made significant investments in the asset improvements (building, etc.) |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com Home Furnishings 12% General Merchandise 12% Sporting Goods 9% Financial Services 9% Dollar Stores 8% Grocery 6% Pharmacy 6% Convenience Stores 5% Entertainment 5% Home Improvement 4% Other 24% 100% EXCELLENT TENANT CREDIT TRANSPARENCY 13 As of 12/31/2021. 1. A credit rated, or investment grade rated tenant (rating of BBB - , Baa3 or NAIC - 2 or higher) is a tenant or the parent of a tenan t with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Association of Insurance Commissioners (NAIC). ▪ 74% of ABR comes from tenants or the parent of a tenant that are credit rated 1 ▪ 71% of ABR comes from tenants or the parent of a tenant that are publicly traded ▪ Nearly half of ABR comes from leases with contractual rent increases in the lease ▪ 9% of ABR comes from ground lease assets where PINE owns the land, and the tenant has a meaningful investment in the improvements ABR % Investment Grade 45% Not Rated 26% Non - Investment Grade 29% |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com STRONG AND STABLE TOP TENANT BASE 14 Credit Rating 1 As of 12/31/2021. 1. A credit rated, or investment grade rated tenant (rating of BBB - , Baa3 or NAIC - 2 or higher) is a tenant or the parent of a tenan t with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Associated of Insurance Commissioners (NAIC). A+ 8% B 6% N/A 6% B+ 5% BBB 5% AA 4% BBB 4% BBB+ 4% BBB 3% N/A 3% 52% 100% ABR % OTHER 1% 2% 5% 11% 3% 10% 5% 12% 13% 8% 31% Lease Rollover Schedule % of ABR Expiring 7.9 Years of Weighted Average Lease Term Remaining |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com HIGH - QUALITY TOP TENANT BASE 15 As of 2/8/2022, unless otherwise noted. Top six tenants based on published information available through each company’s website as of February 8, 2022. Comparably high - quality top six tenant base at a discounted valuation EDUCATION GROUP |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com FINANCIAL STRENGTH 16 Equity Market Capitalization 1 $254M Net Debt Outstanding 2 $260M Total Enterprise Value (TEV) $514M Well - Capitalized Balance Sheet As of 12/31/2021, unless otherwise noted. $ in millions. 1. As of 2/8/2022. 2. Net Debt Outstanding is the Company’s outstanding debt, minus the Company’s cash, cash equivalents and restricted cash. 3. Net Debt to TEV (Total Enterprise Value) is the Company’s outstanding debt, minus the Company’s cash, cash equivalents and re str icted cash, as a percentage of the Company’s enterprise value. 4. See the “Non - GAAP Financial Information” section and tables at the end of this presentation for a discussion and reconciliation of Net Income to non - GAAP financial measures. 5. Reflects $99.0 million outstanding under the Company’s $150 million senior unsecured revolving credit facility; the Company’s se nior unsecured revolving credit facility matures in November 2023 and includes a one - year extension option, subject to satisfaction of certain conditions; the maturity date reflected assumes the Company exercises the one - year extension option. Q4 2021 50% Q4 2021 8.1x Q3 2021 44% Q3 2021 6.9x Q2 2021 35% Q2 2021 5.7x Q1 2021 43% Q1 2021 6.9x Q4 2020 45% Q4 2020 7.3x Limited Capital Needs for Growth Efficient Leverage Profile $99 $30 $60 $80 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Revolving Credit Facility Secured Unsecured Staggered Debt Maturity Schedule Net Debt to TEV 3 Net Debt to Pro Forma EBITDA 4 Debt Outstanding 5 PINE has demonstrated an improved and thoughtful approach to accessing capital and has an efficient cost of debt with a weighted average interest rate on its debt outstanding of 2 .. 1 % .. ▪ Including extension options, PINE has no debt maturities until November 2024 ▪ $60+ million of liquidity via cash, restricted cash and revolving credit facility availability ▪ Revolving credit facility represents the only floating interest rate exposure |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com CONSISTENT DIVIDEND GROWTH 17 $0.060 $0.200 $0.200 $0.200 $0.220 $0.240 $0.250 $0.255 $0.270 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 IPO Q4 2019 Dividend Per Share Paid 2020 2021 Growing, Well - Covered Dividend ▪ Current midpoint of guidance 1 implies a 69% 2022E FFO per share dividend payout ratio ▪ Six dividend raises since the IPO, five increases in the past five quarters ▪ 35% increase in the quarterly cash dividend since the beginning of 2020 Annualized Per Share Cash Dividend $1.08 Annualized Per Share Cash Dividend Yield 5.6% As of 2/9/2022, unless otherwise noted. 1. 2022E FFO per share for PINE is the midpoint of guidance, as provided on February 10, 2022. |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com 2022 GUIDANCE 18 2022 guidance was provided in the Company’s Fourth Quarter and Full Year 2021 Operating Results press release filed on Februa ry 10, 2022. The Company’s 2022 guidance assumes stable or improving economic activity, strong underlying business trends related to each of our tenants and other significant assumptions .. Full - Year 2022 Low High Acquisitions $200 million - $250 million Dispositions $40 million - $50 million FFO Per Diluted Share $1.53 - $1.58 AFFO Per Diluted Share $1.51 - $1.56 Weighted Average Diluted Shares Outstanding 17.0 million shares - 18.5 million shares |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com RESEARCH COVERAGE 19 Baird Wes Golladay Outperform $22.00 B. Riley Craig Kucera Buy $23.00 BTIG Mike Gorman Buy $23.00 Colliers Barry Oxford Buy $22.00 Janney Rob Stevenson Buy $22.00 Jones Research Jason Stewart Buy $23.00 Raymond James RJ Milligan Outperform $23.00 Stifel Simon Yarmak Buy $21.50 Truist Anthony Hau Hold $20.00 Total / Average 89% $22.17 Near Unanimous Buy or Outperform rated by Independent Analysts As of 2/8/2022. Institution Price Target Rating Covering Analyst |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com 20 Aligned Ownership CTO currently owns an approximate 16% interest in PINE, meaningfully aligning its interests with PINE shareholders Independent Board of Directors PINE has its own independent Board of Directors and realizes significant economies of scale from the 18 - member CTO team without the corresponding G&A expense Shadow Pipeline for External Growth PINE has a potential shadow pipeline within the CTO portfolio as a result of its right of first refusal on all CTO single ten ant net lease asset sales Internalization on the Horizon Internalization of management for PINE is anticipated in the future when the Company approaches or exceeds critical mass Opportunities for Collaboration PINE reviews transaction opportunities resulting from CTO’s acquisition efforts that it otherwise would not see in the market th rough normal single tenant acquisition efforts and relationships Alpine Income Property Trust is externally managed by CTO Realty Growth (NYSE : CTO) under an agreement that, combined with CTO’s ownership in PINE, provides economies of scale, significant shareholder alignment and a flexible/collapsible structure .. Benefits and Alignment of External Management Notable Management Agreement Terms ▪ Five - year initial term, with one - year extension options thereafter ▪ Quarterly management fee of 0 .. 375 % , calculated on equity, net of share buybacks and issuance costs ▪ Terminable with payment of a one - time fee of 3 x the average management fee for the preceding 24 - months EXTERNAL MANAGEMENT ALIGNMENT |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com EXPERIENCED MANAGEMENT TEAM 21 John P. Albright , President & Chief Executive Officer Former Co - Head and Managing Director of Archon Capital, a Goldman Sachs Company; Executive Director of Merchant Banking – Investment Management at Morgan Stanley; and Managing Director of Crescent Real Estate (NYSE: CEI). Matthew M. Partridge , Senior Vice President, Chief Financial Officer & Treasurer Former Chief Operating Officer and Chief Financial Officer of Hutton; Executive Vice President, Chief Financial Officer and S ecr etary of Agree Realty Corporation (NYSE: ADC); and Vice President of Finance for Pebblebrook Hotel Trust (NYSE: PEB). Steven R. Greathouse , Senior Vice President & Chief Investment Officer Former Director of Finance for N3 Real Estate; Senior Associate of Merchant Banking – Investment Management at Morgan Stanley; and Senior Associate at Crescent Real Estate (NYSE: CEI). Daniel E. Smith , Senior Vice President, General Counsel & Corporate Secretary Former Vice President and Associate General Counsel of Goldman Sachs & Co. and Senior Vice President and General Counsel of Crescent Real Estate (NYSE: CEI). Lisa M. Vorakoun , Vice President & Chief Accounting Officer Former Assistant Finance Director for the City of DeLand, Florida and Audit Manager for James Moore & Company, an Accounting and Consulting Firm. Helal A. Ismail , Vice President – Investments Former Associate of Jefferies Real Estate Gaming and Lodging Investment Banking and Manager at B - MAT Homes, Inc. Alpine Income Property Trust is led by an experienced management team with meaningful shareholder alignment, deep industry relationships and a strong long - term track record .. |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com 22 Committed Focus Committed to maintaining an environmentally conscious culture, the utilization of environmentally friendly & renewable products, and the promotion of sustainable business practices Tenant Alignment Alignment with environmentally aware tenants who have strong sustainability programs and initiatives embedded into their corporate culture and business practices Alpine Income Property Trust, through its external manager, is committed to sustainability, strong corporate governance, and meaningful corporate social responsibility programs .. Social Responsibility Environmental Responsibility CORPORATE RESPONSIBILITY Corporate Governance ▪ Independent Chairman of the Board and 5 of 6 Directors classified as independent ▪ Annual election of all Directors ▪ Annual Board of Director evaluations ▪ Stock ownership requirements for all Directors ▪ Prohibition against hedging and pledging Alpine Income Property Trust stock ▪ Robust policies and procedures for approval of related party transactions ▪ Opted out of business combination and control share acquisition statutes in the Maryland General Corporation Law ▪ All team members adhere to a comprehensive Code of Business Conduct and Ethics policy Inclusive and Supportive Company Culture Dedicated to an inclusive and supportive office environment filled with diverse backgrounds and perspectives, with a demonstrated commitment to financial, mental and physical wellness Notable Community Outreach Numerous and diverse community outreach programs, supporting environmental, artistic, civil and social organizations in the community |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com KEY TAKEAWAYS 23 As of 12/31/2021, unless otherwise noted. 1. 2022E FFO per share for PINE is the midpoint of guidance, as provided on February 10, 2022. Significant Discount to Peer Group Meaningful potential upside in valuation as PINE has the lowest 2022E FFO multiple of its net lease peer group. Stable & Growing Dividend PINE has grown its quarterly dividend by 35% since the beginning of 2020 and currently has a 2022E FFO 1 payout ratio of approximately 69%, one of the lowest implied payout ratios of the net lease peer group. Small Asset Base is an Opportunity for Outsized Growth Small asset denominator means management can drive outsized growth relative to its net lease peers. Disciplined Investment Strategy Real estate and credit - focused underwriting, targeting investments that exhibit strong demographic trends, leased to high - quality, industry - leading tenants. High - Quality, Stable and Growing Portfolio Portfolio rooted in publicly - traded/credit - rated tenants, and larger markets means there is a high - quality, stable asset base and an opportunity to add a diverse array of new tenants, markets and sectors. Financial Strength Balance sheet with ample liquidity and no near - term debt maturities provides financial stability and flexibility. Aligned Sponsorship & Management Externally managed by CTO Realty Growth (NYSE: CTO), a publicly traded REIT that owns 16% of PINE and is committed to internalization of management once critical mass is attained. |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com DISCLAIMER 24 This presentation may contain “forward - looking statements .. ” Forward - looking statements include statements that may be identified by words such as “could,” “may,” “might,” “will,” “likely,” “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “continues,” “projects” and similar references to future periods, or by the inclusion of forecasts or projections .. Forward - looking statements are based on the Company’s current expectations and assumptions regarding capital market conditions, the Company’s business, the economy and other future conditions .. Because forward - looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict .. As a result, the Company’s actual results may differ materially from those contemplated by the forward - looking statements .. Important factors that could cause actual results to differ materially from those in the forward - looking statements include general business and economic conditions, continued volatility and uncertainty in the credit markets and broader financial markets, risks inherent in the real estate business, including tenant defaults, potential liability relating to environmental matters, illiquidity of real estate investments and potential damages from natural disasters, the impact of the COVID - 19 Pandemic and its variants on the Company’s business and the business of its tenants and the impact on the U .. S .. economy and market conditions generally, other factors affecting the Company’s business or the business of its tenants that are beyond the control of the Company or its tenants, and the factors set forth under “Risk Factors” in the Company’s Annual Report on Form 10 - K for the year ended December 31 , 2021 and other risks and uncertainties discussed from time to time in the Company’s filings with the U .. S .. Securities and Exchange Commission .. Any forward - looking statement made in this presentation speaks only as of the date on which it is made .. The Company undertakes no obligation to publicly update or revise any forward - looking statement, whether as a result of new information, future developments or otherwise .. References in this presentation : 1. All information is as of December 31 , 2021 , unless otherwise noted .. 2. Annualized straight - line Base Rent (“ABR” or “Rent”) and the statistics based on ABR are calculated based on our current portfolio as of December 31 , 2021 .. 3. Dividends are set by the Board of Directors and declared on a quarterly basis and there can be no assurances as to the likelihood or amount of dividends in the future .. 4. A credit rated, or investment grade rated tenant (a tenant carrying a rating of BBB - , Baa 3 or NAIC - 2 or higher) is a tenant or the parent of a tenant with a credit rating from S&P Global Ratings, Moody’s Investors Service, Fitch Ratings or the National Associated of Insurance Commissioners (NAIC) .. 5. Contractual Base Rent (“CBR”) represents the amount owed to the Company under the terms of its lease agreements at the time referenced .. |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com NON - GAAP FINANCIAL INFORMATION 25 Our reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”) .. We also disclose Funds From Operations (“FFO”), Adjusted Funds From Operations (“AFFO”) and Pro Forma Earnings Before Interest, Taxes, Depreciation and Amortization (“Pro Forma EBITDA”), all of which are non - GAAP financial measures .. We believe these non - GAAP financial measures are useful to investors because they are widely accepted industry measures used by analysts and investors to compare the operating performance of REITs .. FFO, AFFO and Pro Forma EBITDA do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund cash requirements ; accordingly, they should not be considered alternatives to net income as a performance measure or cash flows from operations as reported on our statement of cash flows as a liquidity measure and should be considered in addition to, and not in lieu of, GAAP financial measures .. We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT .. NAREIT defines FFO as GAAP net income or loss adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write - downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries .. To derive AFFO, we modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to non - cash revenues and expenses such as straight - line rental revenue, amortization of deferred financing costs, amortization of above - and below - market lease related intangibles, non - cash compensation, and other non - cash income .. Such items may cause short - term fluctuations in net income but have no impact on operating cash flows or long - term operating performance .. We use AFFO as one measure of our performance when we formulate corporate goals .. To derive Pro Forma EBITDA, GAAP net income or loss is adjusted to exclude extraordinary items (as defined by GAAP), net gain or loss from sales of depreciable real estate assets, impairment write - downs associated with depreciable real estate assets and real estate related depreciation and amortization, including the pro rata share of such adjustments of unconsolidated subsidiaries, non - cash revenues and expenses such as straight - line rental revenue, amortization of deferred financing costs, above - and below - market lease related intangibles, non - cash compensation, and other non - cash income or expense .. Cash interest expense is also excluded from Pro Forma EBITDA, and GAAP net income or loss is adjusted for the annualized impact of acquisitions, dispositions and other similar activities .. FFO is used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers primarily because it excludes the effect of real estate depreciation and amortization and net gains or losses on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions .. We believe that AFFO is an additional useful supplemental measure for investors to consider because it will help them to better assess our operating performance without the distortions created by other non - cash revenues or expenses .. We also believe that Pro Forma EBITDA is an additional useful supplemental measure for investors to consider as it allows for a better assessment of our operating performance without the distortions created by other non - cash revenues, expenses or certain effects of the Company’s capital structure on our operating performance .. FFO, AFFO, and Pro Forma EBITDA may not be comparable to similarly titled measures employed by other companies .. |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com NON - GAAP FINANCIAL MEASURES RECONCILIATION 26 Alpine Income Property Trust, Inc. Consolidated Statements of Operations (Unaudited) (In thousands, except share, per share and dividend data) Three Months Ended Year Ended December 31, 2021 December 31, 2020 December 31, 2021 December 30, 2020 Revenues: Lease Income $ 9,470 $ 5,385 $ 30,128 $ 19,248 Total Revenues 9,470 5,385 30,128 19,248 Operating Expenses: Real Estate Expenses 1,284 611 3,673 2,316 General and Administrative Expenses 1,340 1,125 5,027 4,660 Depreciation and Amortization 5,025 2,946 15,939 9,949 Total Operating Expenses 7,649 4,682 24,639 16,925 Gain on Disposition of Assets 9,131 – 9,675 287 Net Income from Operations 10,952 703 15,164 2,610 Interest Expense 1,403 487 3,702 1,464 Net Income 9,549 216 11,462 1,146 Less: Net Income Attributable to Noncontrolling Interest (1,247) (30) (1,498) (161) Net Income Attributable to Alpine Income Property Trust, Inc. $ 8,302 $ 186 $ 9,964 $ 985 Per Common Share Data: Net Income Attributable to Alpine Income Property Trust, Inc. Basic $ 0.73 $ 0.02 $ 1.02 $ 0.13 Diluted $ 0.64 $ 0.02 $ 0.89 $ 0.11 Weighted Average Number of Common Shares: Basic 11,347,778 7,458,755 9,781,066 7,588,349 Diluted 1 13,051,272 8,682,609 11,246,227 8,812,203 Dividends Declared and Paid $ 0.270 $ 0.220 $ 1.015 $ 0.820 1 .. Includes the weighted average impact of 1 , 703 , 494 shares underlying OP units including ( i ) 1 , 223 , 854 shares underlying OP Units issued to CTO Realty Growth, Inc .. and (ii) 479 , 640 shares underlying OP Units issued to an unrelated third party .. |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com NON - GAAP FINANCIAL MEASURES RECONCILIATION 27 Three Months Ended Year Ended December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 Net Income $ 9,549 $ 216 $ 11,462 $ 1,146 Depreciation and Amortization 5,025 2,946 15,939 9,949 Gain on Disposition of Assets (9,131) - (9,675) (287) Funds from Operations $ 5,443 $ 3,162 $ 17,726 $ 10,808 Adjustments: Straight - Line Rent Adjustment (214) (287) (607) (1,524) COVID - 19 Rent Repayments (Deferrals), Net 22 160 430 (378) Non - Cash Compensation 78 67 309 268 Amortization of Deferred Financing Costs to Interest Expense 126 55 362 188 Amortization of Intangible Assets and Liabilities to Lease Income (89) (30) (257) (108) Other Non - Cash (Income) Expense (1) (12) (18) (22) Recurring Capital Expenditures – (9) (41) (43) Adjusted Funds from Operations $ 5,365 $ 3,106 $ 17,904 $ 9,189 FFO per diluted share $ 0.42 $ 0.36 $ 1.58 $ 1.23 AFFO per diluted share $ 0.41 $ 0.36 $ 1.59 $ 1.04 Alpine Income Property Trust, Inc. Non - GAAP Financial Measures Funds From Operations and Adjusted Funds From Operations (Unaudited) (In thousands, except per share data) |
| © 2022 Alpine Income Property Trust, Inc. | alpinereit.com NET DEBT TO PRO FORMA EBITDA RECONCILIATION 28 Alpine Income Property Trust, Inc. Non - GAAP Financial Measures Reconciliation of Net Debt to Pro Forma EBITDA (Unaudited) (In thousands) 1. Reflects the pro forma annualized impact on Annualized EBITDA of the Company’s acquisition and disposition activity during th e t hree months ended December 31, 2021. Three Months Ended December 31, 2021 Net Income $ 9,549 Adjustments: Depreciation and Amortization 5,025 Gain on Disposition of Assets (9,131) Straight - Line Rent Adjustment (214) Non - Cash Compensation 78 Amortization of Deferred Financing Costs to Interest Expense 126 Amortization of Intangible Assets and Liabilities to Lease Income (89) Other Non - Cash (Income) Expense (1) Interest Expense, net of Deferred Financing Costs Amortization 1,278 EBITDA $ 6,621 Annualized EBITDA $ 26,484 Pro Forma Annualized Impact of Current Quarter Acquisitions and Dispositions, Net 1 5,582 Pro Forma EBITDA $ 32,066 Total Long - Term Debt 267,740 Financing Costs, Net of Accumulated Amortization 1,260 Cash (8,851) Restricted Cash (646) Net Debt $ 259,503 Net Debt to Pro Forma EBITDA 8.1x |
| INVESTOR PRESENTATION Investor Inquiries: Matthew M. Partridge, Chief Financial Officer, (386) 944 - 5643, mpartridge@alpinereit.com |
