Table of Contents
Third Quarter 2018 
1
Forward Looking Statements
This Supplemental Information package contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). These forward-looking statements include, without limitation, statements about our estimates, expectations, predictions and forecasts of our future business plans and financial and operating performance and/or results, including our full-year 2018 earnings guidance, our ability to successfully source, structure, negotiate and close investments in self-storage facilities, our ability to fund our outstanding future investment commitments, the availability, terms and our rate of deployment of equity capital and our ability to increase borrowing base of our credit facility, as well as statements of management’s goals and objectives and other similar expressions concerning matters that are not historical facts. When we use the words “may,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” or similar expressions or their negatives, as well as statements in future tense, we intend to identify forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, beliefs and expectations, such forward-looking statements are not predictions of future events or guarantees of future performance and our actual financial and operating results could differ materially from those set forth in the forward-looking statements. Some factors that might cause such differences are described in the section entitled “Risk Factors” in our most recent Annual Report on Form 10-K for the year ended December 31, 2017, and those set forth in our other reports and information filed with the Securities and Exchange Commission (“SEC”), which factors include, without limitation, the following:
| | |
| | our ability to successfully source, structure, negotiate and close investments in self-storage facilities; |
| | changes in our business strategy and the market’s acceptance of our investment terms; |
| | our ability to fund our outstanding and future investment commitments; |
| | our ability to obtain certificates of occupancy at the facilities in which we invest; |
| | the future availability for borrowings under our credit facility (including borrowing base capacity and the availability of the accordion feature); |
| | availability, terms and our rate of deployment of equity and debt capital; |
| | our manager’s ability to hire and retain qualified personnel; |
| | changes in the self-storage industry, interest rates or the general economy; |
| | the degree and nature of our competition; |
| | volatility in the value of our assets carried at fair market value; |
| | potential limitations on our ability to pay dividends at historical rates; |
| | limitations in our existing and future debt agreements on our ability to pay distributions; |
| | the impact of our outstanding preferred stock on our ability to execute our business plan and pay distributions on our common stock; and |
| | general volatility of the capital markets and the market price of our common stock. |
Given these uncertainties, undue reliance should not be placed on our forward-looking statements. We assume no duty or responsibility to publicly update or revise any forward-looking statement that may be made to reflect future events or circumstances or to reflect the occurrence of unanticipated events. We urge you to review the disclosures concerning risks in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our most recent Annual Report on Form 10-K for the year ended December 31, 2017 and in other documents that we file from time-to-time with the SEC.
Non-GAAP Financial Measures
Adjusted Earnings is a non-GAAP measure and is defined as net income attributable to common stockholders plus stock dividends payable to preferred stockholders, stock-based compensation expense, depreciation and amortization on real estate assets, loss on modification of debt, and other expenses. Management uses Adjusted Earnings and Adjusted Earnings per diluted share as key performance indicators in evaluating the operations of the Company's business. The Company is a capital provider to self-storage developers and believes that these measures are useful to management and investors as a starting point in measuring its operational performance because they exclude various equity-based payments (including stock dividends) and other items included in net income that do not relate to or are not indicative of its present and future operating performance, which can make periodic and peer analyses of operating performance more difficult. The Company’s computation of Adjusted Earnings and Adjusted Earnings per share may not be comparable to other key performance indicators reported by other REITs or real estate companies. Reconciliations of Adjusted Earnings and Adjusted Earnings per share to Net income attributable to common stockholders and Earnings per share, respectively, are provided in the attached table entitled “Calculation of Adjusted Earnings.”
Third Quarter 2018 2
Press Release – October 2018
Jernigan Capital Reports Third Quarter Earnings per Share and Adjusted Earnings per Share at Top End of Guidance Range
MEMPHIS, Tennessee, October 31, 2018 / Business Wire / Jernigan Capital, Inc. (NYSE: JCAP), a leading capital partner for self-storage entrepreneurs nationwide, today announced results for the quarter ended September 30, 2018, and reaffirmed earnings per share and adjusted earnings per share guidance for full-year 2018.
Third Quarter Highlights include:
| § | | Earnings per share and adjusted earnings per share of $0.57 and $0.75, respectively – results are at the top end of guidance ranges provided with the Company’s second quarter 2018 earnings release. |
| § | | Quarterly net income attributable to common stockholders of $11.2 million represents a 169% increase over $4.1 million reported for third quarter of 2017; quarterly adjusted earnings of $14.5 million represents a 192% increase over $5.0 million reported for third quarter 2017. |
| § | | Continued execution of business plan to own new self-storage properties in top markets through buyout of developer partner’s interest in Charlotte facility – Company now wholly-owns six of the initial 11 self-storage facilities financed in 2015. |
| § | | Received net proceeds in excess of recorded fair value of the Company’s original loan investment in a self-storage project in suburban Tampa area. |
| § | | Construction completed and operations commenced for nine additional Generation V self-storage development properties in which JCAP has an aggregate committed investment of $97.4 million. |
| § | | Continued to source high-quality financing of the Company’s development commitments by procuring from one of the Company’s existing syndicate banks $24.9 million of first mortgage loans on three of the Company's wholly-owned self-storage facilities. |
“We are very pleased with our third quarter results and our achievements through the first nine months of the year,” stated Dean Jernigan, Executive Chairman of Jernigan Capital, Inc. “Our strong results are the fruits of a best in class team, focused site selection and meticulous underwriting. We are also excited to have acquired 100% ownership of the state-of-the art self-storage facility that we financed in Charlotte during our inaugural year, furthering our objective to own a substantial majority of the facilities we finance.”
John Good, Chief Executive Officer of the Company added, “Our third quarter results reflect 170% growth in total revenues, 97% growth in earnings per share and 114% growth in adjusted earnings per share compared to the comparable quarter in 2017. Moreover, we are beginning to reap the benefits of the record investment year we experienced in 2017, as twelve new Generation V stores opened for business in top markets since the end of the second quarter. Our developer partners have now delivered 36 of the 68, or over 50%, of the self-storage projects we have financed. During the third quarter, we experienced the first monetization of an existing investment, as our developer partner of a suburban Tampa project that opened in April 2016 was sold to a third party with net proceeds to JCAP exceeding the fair value at which the investment was recorded at the time of the transaction.”
“During the quarter we procured an aggregate $24.9 million of first mortgage debt financing on three of our wholly-owned self-storage facilities and issued the remaining $15.0 million of preferred stock under our 2016 preferred stock purchase agreement with Highland Capital,” stated Mr. Good. “Our investment commitments are now fully-covered through the back end of 2019 and we have positioned ourselves to maintain conservative leverage levels for the foreseeable future.”
Financial Highlights
Earnings per share and adjusted earnings per share for the three months ended September 30, 2018 were $0.57 and $0.75, respectively, which is in line with the top end of the Company’s guidance range. Earnings per share and adjusted earnings per share for the nine months ended September 30, 2018 were $1.16 and $1.80, respectively.
Net income attributable to common stockholders for the three months ended September 30, 2018 was $11.2 million, an increase of $7.0 million, or 169%, over the $4.1 million net income attributable to common stockholders for the comparable quarter in 2017. Net income attributable to common stockholders for the nine months ended September 30, 2018 was $19.2 million, an increase of $8.7 million, or 84%, over the $10.4 million reported for the comparable nine month period in 2017.
Third Quarter 2018 3
Adjusted earnings for the three months ended September 30, 2018 were $14.5 million, a 192% increase over the $5.0 million adjusted earnings for the comparable quarter of 2017. Adjusted earnings for the nine months ended September 30, 2018 was $29.8 million compared to $12.4 million for the comparable nine month period in 2017, a 140% increase.
Total revenues for the three and nine months ended September 30, 2018 were $9.1 million and $21.5 million, respectively, representing increases of $5.7 million, or 170%, and $13.3 million, or 161%, over total revenues for the three and nine months ended September 30, 2017, respectively. The increase in revenues is primarily attributed to the increase in the outstanding principal balances on the Company’s investment portfolio and the increase in rental and other property-related income derived from the Company’s self-storage real estate owned.
General and administrative expenses, excluding management fees to the manager, for the three and nine months ended September 30, 2018 were $1.7 million and $5.6 million, compared to $1.4 million and $4.3 million for the comparable 2017 periods, respectively. Included in these amounts were stock-based compensation expense (“SBE”) of $0.4 million and $0.3 million for the three months ended September 30, 2018 and 2017, respectively, and $1.5 million and $1.0 million for the nine months ended September 30, 2018 and 2017, respectively. The increase in SBE was primarily due to additional restricted stock grants to certain officers and employees of the Company’s external manager during 2017 and 2018. General and administrative expenses also increased as a result of annual compensation increases as well as the addition of a senior executive employee at the Company’s external manager during 2018.
On August 28, 2018, the limited liability company that owned the self-storage project underlying the Company’s Tampa 1 investment sold the property to a third party and distributed net proceeds from the sale to the Company in settlement of its first mortgage loan and 49.9% Profits Interest. In addition to full repayment of the Company’s underlying mortgage loan having outstanding principal of $5.3 million, it received proceeds of $725,000 comprised of $106,000 of prepayment penalty which is recognized in interest income from investments and $619,000 which is recognized as realized gain on investments. These proceeds exceeded the Company’s fair value recognized on this investment through June 30, 2018 by $54,000.
Net income attributable to common stockholders and adjusted earnings for the three and nine months ended September 30, 2018 also include increases in the fair value of investments of $11.1 million and $24.0 million, respectively, compared to increases of $3.4 million and $9.1 million for the comparable periods in 2017. This represents a $7.7 million, or 227%, and $14.9 million, or 165%, year-over-year increase from the three and nine months ended September 30, 2017, respectively. During 2017, the Company consummated 32 on-balance sheet development investments totaling $408.8 compared to three on-balance sheet development investments totaling $25.6 million in 2016. The increase in the fair value of investments is driven primarily by construction progression on the Company’s 2017 investments.
Capital Markets Activities
As of September 30, 2018, the Company had issued 125,000 shares of its Series A Preferred Stock and received $125.0 million in gross proceeds pursuant to the terms of a purchase agreement between the Company and Highland Capital Management (the “Purchase Agreement”). The Company has now issued all shares of Series A Preferred Stock available for issuance under the Purchase Agreement. During the quarter, the Company did not issue any shares of common stock or Series B preferred stock under its ATM programs, and continues to have approximately $20.6 million of capacity under its common stock ATM program and $43.4 million under its Series B preferred stock ATM program.
As of September 30, 2018, the Company had no borrowings under its secured revolving credit facility and had $81.5 million in total availability. The Company expects such availability to increase over the balance of 2018 and 2019 as the Company’s on-balance sheet self-storage investments continue to achieve certificates of occupancy and commence lease-up.
During the three months ended September 30, 2018, the Company obtained term loans in the aggregate principal amount of $24.9 million, which are secured by the Company's three wholly-owned self-storage facilities in Orlando, Florida and Atlanta, Georgia.
Dividends
On July 31, 2018, the Company declared cash and stock dividends on its Series A Preferred Stock. The cash dividend of $2.0 million was paid on October 15, 2018 to holders of record on October 1, 2018. A stock dividend of 109,494 shares of common stock was issued on October 15, 2018 to holders of record on October 1, 2018 for an aggregate value of $2.1 million pursuant to the terms of the Stock Purchase Agreement.
On July 31, 2018, the Company declared a cash dividend on its Series B Preferred Stock. The cash dividend of $0.7 million was paid on October 15, 2018 to holders of record on October 1, 2018.
Additionally, on July 31, 2018, the Company declared a dividend of $0.35 per common share. The dividend was paid on October 15, 2018 to common stockholders of record on October 1, 2018.
Third Quarter 2018 4
Full-Year 2018 Guidance
The Company is reaffirming its earnings per share guidance range of $1.77 to $2.25 and adjusted earnings per share guidance range of $2.57 to $3.05 for the full-year 2018. Such guidance is based on management's current expectations of Company investment activity (including fair value appreciation and the expected timing of construction progress), the operational and new supply dynamics of the self-storage markets in which the Company has invested, and overall economic conditions.
The guidance above is based on the following key assumptions that could have an impact on the Company’s financial results:
| · | | Utilization of debt over the remaining course of the year with expected borrowings at year-end of $55.0 million to $65.0 million. |
| · | | No change in the key assumptions used to value the Company’s investments other than the assumption of one 25 basis points interest rate increase for the remainder of 2018. |
Additionally, the Company continues to monitor the construction progress of its investments with its development partners. Timing of fair value appreciation is heavily dependent upon construction progress, which is subject to factors outside the control of the Company’s development partners. As such, the exact timing of fair value recognition is subject to change.
Refer to the Company’s Third Quarter 2018 Supplemental Information Package for more information.
Third Quarter 2018 5
Jernigan Capital, Inc.
Financial Highlights- Trailing Five Quarters
(unaudited, in thousands, except share and per share data)
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�� | | | | | | | | | | | | | | | |
| | Three months ended |
| | September 30, | | June 30, | | March 31, | | December 31, | | September 30, |
| | 2018 | | 2018 | | 2018 | | 2017 | | 2017 |
Operating Data: | | | | | | | | | | | | | | | |
Interest income, rental-related income and other revenues | | $ | 9,091 | | $ | 7,241 | | $ | 5,216 | | $ | 3,930 | | $ | 3,361 |
JV income | | | 440 | | | 435 | | | 550 | | | 516 | | | 730 |
Total revenues and JV income | | | 9,531 | | | 7,676 | | | 5,766 | | | 4,446 | | | 4,091 |
General & administrative expenses | | | (3,599) | | | (3,616) | | | (3,122) | | | (2,597) | | | (2,422) |
Property operating expenses of real estate owned | | | (473) | | | (420) | | | (311) | | | (83) | | | (114) |
Depreciation and amortization of real estate owned | | | (854) | | | (887) | | | (702) | | | (238) | | | (172) |
Interest expense | | | (467) | | | (638) | | | (416) | | | (296) | | | (323) |
Loss on modification of debt | | | - | | | - | | | - | | | - | | | (232) |
Other expenses | | | - | | | - | | | (290) | | | - | | | - |
Subtotal | | | 4,138 | | | 2,115 | | | 925 | | | 1,232 | | | 828 |
Realized gain on investments | | | 619 | | | - | | | - | | | - | | | - |
Net unrealized gain on investments | | | 11,060 | | | 8,623 | | | 4,320 | | | 1,738 | | | 3,384 |
Other interest income | | | 147 | | | 59 | | | 109 | | | 155 | | | 245 |
Net income | | | 15,964 | | | 10,797 | | | 5,354 | | | 3,125 | | | 4,457 |
Net income attributable to preferred stockholders | | | (4,790) | | | (4,580) | | | (3,595) | | | (423) | | | (310) |
Net income attributable to common stockholders | | $ | 11,174 | | $ | 6,217 | | $ | 1,759 | | $ | 2,702 | | $ | 4,147 |
Plus: stock dividends payable to preferred stockholders | | | 2,125 | | | 2,125 | | | 2,125 | | | 44 | | | 132 |
Plus: stock-based compensation | | | 385 | | | 777 | | | 345 | | | 272 | | | 296 |
Plus: depreciation and amortization on real estate assets | | | 854 | | | 887 | | | 702 | | | 238 | | | 172 |
Plus: loss on modification of debt | | | - | | | - | | | - | | | - | | | 232 |
Plus: other expenses | | | - | | | - | | | 290 | | | - | | | - |
Adjusted Earnings | | $ | 14,538 | | $ | 10,006 | | $ | 5,221 | | $ | 3,256 | | $ | 4,979 |
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Basic earnings per share attributable to common stockholders | | $ | 0.58 | | $ | 0.40 | | $ | 0.12 | | $ | 0.19 | | $ | 0.29 |
Diluted earnings per share attributable to common stockholders | | $ | 0.57 | | $ | 0.40 | | $ | 0.12 | | $ | 0.19 | | $ | 0.29 |
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Adjusted Earnings per share attributable to common stockholders - diluted | | $ | 0.75 | | $ | 0.64 | | $ | 0.36 | | $ | 0.23 | | $ | 0.35 |
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Dividends declared per share of common stock | | $ | 0.35 | | $ | 0.35 | | $ | 0.35 | | $ | 0.35 | | $ | 0.35 |
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Weighted-average shares of common stock outstanding: | | | | | | | | | | | | | | | |
Basic | | | 19,184,172 | | | 15,274,459 | | | 14,247,174 | | | 14,108,415 | | | 14,042,350 |
Diluted | | | 19,459,751 | | | 15,564,317 | | | 14,555,337 | | | 14,295,639 | | | 14,244,345 |
Shares of common stock outstanding: | | | 19,364,339 | | | 19,254,141 | | | 14,447,043 | | | 14,429,055 | | | 14,235,848 |
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Balance Sheet Data: | | | | | | | | | | | | | | | |
Cash and cash equivalents | | $ | 42,624 | | $ | 43,331 | | $ | 15,238 | | $ | 46,977 | | $ | 54,999 |
Self-Storage Investment Portfolio: | | | | | | | | | | | | | | | |
Development property investments at fair value | | | 335,509 | | | 302,245 | | | 239,754 | | | 228,233 | | | 188,540 |
Bridge loan investments at fair value | | | 81,862 | | | 79,581 | | | 77,435 | | | - | | | - |
Operating property loans at fair value | | | 2,440 | | | 5,862 | | | 5,885 | | | 5,938 | | | 5,990 |
Self-storage real estate owned | | | 74,444 | | | 61,896 | | | 61,633 | | | 15,827 | | | 15,827 |
Accumulated depreciation on self-storage real estate owned | | | (2,915) | | | (2,061) | | | (1,174) | | | (472) | | | (233) |
Self-storage real estate owned, net | | | 71,529 | | | 59,835 | | | 60,459 | | | 15,355 | | | 15,594 |
Investment in and advances to self-storage real estate venture | | | 14,401 | | | 14,846 | | | 14,759 | | | 13,856 | | | 12,573 |
Total assets | | | 556,228 | | | 509,860 | | | 417,252 | | | 314,634 | | | 284,193 |
Gross assets | | | 559,143 | | | 511,921 | | | 418,426 | | | 315,106 | | | 284,426 |
| | | | | | | | | | | | | | | |
Senior loan participation | | | - | | | - | | | 732 | | | 718 | | | 668 |
Secured revolving credit facility | | | - | | | - | | | 30,000 | | | - | | | - |
Term loans, net of unamortized costs | | | 24,578 | | | - | | | - | | | - | | | - |
Total liabilities | | | 40,689 | | | 16,122 | | | 43,944 | | | 8,814 | | | 8,434 |
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Total equity | | | 515,539 | | | 493,738 | | | 373,308 | | | 305,820 | | | 275,759 |
Common book value / common shares outstanding | | $ | 18.38 | | $ | 18.13 | | $ | 18.35 | | $ | 18.58 | | $ | 18.71 |
Third Quarter 2018 6
Jernigan Capital, Inc.
Consolidated Balance Sheets- Trailing Five Quarters
(unaudited, in thousands)
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| | As of |
| | September 30, | | June 30, | | March 31, | | December 31, | | September 30, |
| | 2018 | | 2018 | | 2018 | | 2017 | | 2017 |
Assets: | | | | | | | | | | | | | | | |
Cash and cash equivalents | | $ | 42,624 | | $ | 43,331 | | $ | 15,238 | | $ | 46,977 | | $ | 54,999 |
Self-Storage Investment Portfolio: | | | | | | | | | | | | | | | |
Development property investments at fair value | | | 335,509 | | | 302,245 | | | 239,754 | | | 228,233 | | | 188,540 |
Bridge loan investments at fair value | | | 81,862 | | | 79,581 | | | 77,435 | | | - | | | - |
Operating property loans at fair value | | | 2,440 | | | 5,862 | | | 5,885 | | | 5,938 | | | 5,990 |
Self-storage real estate owned, net | | | 71,529 | | | 59,835 | | | 60,459 | | | 15,355 | | | 15,594 |
Investment in and advances to self-storage real estate venture | | | 14,401 | | | 14,846 | | | 14,759 | | | 13,856 | | | 12,573 |
Other loans, at cost | | | 4,818 | | | 1,361 | | | 1,103 | | | 1,313 | | | 1,754 |
Deferred financing costs | | | 1,503 | | | 1,644 | | | 1,565 | | | 2,004 | | | 3,813 |
Prepaid expenses and other assets | | | 1,327 | | | 975 | | | 884 | | | 776 | | | 734 |
Fixed assets, net | | | 215 | | | 180 | | | 170 | | | 182 | | | 196 |
Total assets | | $ | 556,228 | | $ | 509,860 | | $ | 417,252 | | $ | 314,634 | | $ | 284,193 |
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Liabilities: | | | | | | | | | | | | | | | |
Senior loan participation | | $ | - | | $ | - | | $ | 732 | | $ | 718 | | $ | 668 |
Secured revolving credit facility | | | - | | | - | | | 30,000 | | | - | | | - |
Term loans, net of unamortized costs | | | 24,578 | | | - | | | - | | | - | | | - |
Due to Manager | | | 2,309 | | | 1,887 | | | 1,405 | | | 1,484 | | | 1,438 |
Accounts payable, accrued expenses and other liabilities | | | 2,235 | | | 2,916 | | | 3,155 | | | 1,138 | | | 1,035 |
Dividends payable | | | 11,567 | | | 11,319 | | | 8,652 | | | 5,474 | | | 5,293 |
Total liabilities | | $ | 40,689 | | $ | 16,122 | | $ | 43,944 | | $ | 8,814 | | $ | 8,434 |
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Equity: | | | | | | | | | | | | | | | |
Series A Cumulative preferred stock | | $ | 122,137 | | $ | 107,168 | | $ | 72,181 | | $ | 37,764 | | $ | 9,445 |
Series B Cumulative preferred stock | | | 37,425 | | | 37,463 | | | 35,988 | | | - | | | - |
Common stock | | | 193 | | | 192 | | | 144 | | | 144 | | | 142 |
Additional paid-in capital | | | 364,108 | | | 361,636 | | | 277,194 | | | 276,814 | | | 272,726 |
Accumulated deficit | | | (8,324) | | | (12,721) | | | (12,199) | | | (8,902) | | | (6,554) |
Total equity | | | 515,539 | | | 493,738 | | | 373,308 | | | 305,820 | | | 275,759 |
Total liabilities and equity | | $ | 556,228 | | $ | 509,860 | | $ | 417,252 | | $ | 314,634 | | $ | 284,193 |
Third Quarter 2018 7
Jernigan Capital, Inc.
Consolidated Statements of Operations
(unaudited, in thousands, except per share data)
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| | | | | | | | | | | | |
| | Three months ended | | Nine months ended |
| | September 30, | | September 30, |
| | 2018 | | 2017 | | 2018 | | 2017 |
Revenues: | | | | | | | | | | | | |
Interest income from investments | | $ | 8,086 | | $ | 3,173 | | $ | 19,051 | | $ | 7,759 |
Rental and other property-related income from real estate owned | | | 970 | | | 160 | | | 2,398 | | | 328 |
Other revenues | | | 35 | | | 28 | | | 99 | | | 174 |
Total revenues | | | 9,091 | | | 3,361 | | | 21,548 | | | 8,261 |
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Costs and expenses: | | | | | | | | | | | | |
General and administrative expenses | | | 1,727 | | | 1,386 | | | 5,579 | | | 4,336 |
Management fees to Manager | | | 1,872 | | | 1,036 | | | 4,758 | | | 2,373 |
Property operating expenses of real estate owned | | | 473 | | | 114 | | | 1,204 | | | 188 |
Depreciation and amortization of real estate owned | | | 854 | | | 172 | | | 2,443 | | | 233 |
Other expenses | | | - | | | - | | | 290 | | | - |
Total costs and expenses | | | 4,926 | | | 2,708 | | | 14,274 | | | 7,130 |
| | | | | | | | | | | | |
Operating income | | | 4,165 | | | 653 | | | 7,274 | | | 1,131 |
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Other income (expense): | | | | | | | | | | | | |
Equity in earnings from unconsolidated real estate venture | | | 440 | | | 730 | | | 1,425 | | | 1,747 |
Realized gain on investments | | | 619 | | | - | | | 619 | | | - |
Net unrealized gain on investments | | | 11,060 | | | 3,384 | | | 24,003 | | | 9,066 |
Interest expense | | | (467) | | | (323) | | | (1,521) | | | (757) |
Loss on modification of debt | | | - | | | (232) | | | - | | | (232) |
Other interest income | | | 147 | | | 245 | | | 315 | | | 479 |
Total other income | | | 11,799 | | | 3,804 | | | 24,841 | | | 10,303 |
Net income | | | 15,964 | | | 4,457 | | | 32,115 | | | 11,434 |
Net income attributable to preferred stockholders | | | (4,790) | | | (310) | | | (12,965) | | | (1,033) |
Net income attributable to common stockholders | | $ | 11,174 | | $ | 4,147 | | $ | 19,150 | | $ | 10,401 |
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Basic earnings per share attributable to common stockholders | | $ | 0.58 | | $ | 0.29 | | $ | 1.17 | | $ | 0.94 |
Diluted earnings per share attributable to common stockholders | | $ | 0.57 | | $ | 0.29 | | $ | 1.16 | | $ | 0.94 |
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Dividends declared per share of common stock | | $ | 0.35 | | $ | 0.35 | | $ | 1.05 | | $ | 1.05 |
Third Quarter 2018 8
Jernigan Capital, Inc.
Calculation of Adjusted Earnings and Reconciliation to Net Income Attributable to Common Stockholders
(unaudited, in thousands, except share and per share data)
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| | | | | | | | | | | | | | | |
| | Three months ended |
| | September 30, | | June 30, | | March 31, | | December 31, | | September 30, |
| | 2018 | | 2018 | | 2018 | | 2017 | | 2017 |
Net income attributable to common stockholders | | $ | 11,174 | | $ | 6,217 | | $ | 1,759 | | $ | 2,702 | | $ | 4,147 |
Plus: stock dividends payable to preferred stockholders | | | 2,125 | | | 2,125 | | | 2,125 | | | 44 | | | 132 |
Plus: stock-based compensation | | | 385 | | | 777 | | | 345 | | | 272 | | | 296 |
Plus: depreciation and amortization on real estate assets | | | 854 | | | 887 | | | 702 | | | 238 | | | 172 |
Plus: loss on modification of debt | | | - | | | - | | | - | | | - | | | 232 |
Plus: other expenses | | | - | | | - | | | 290 | | | - | | | - |
Adjusted Earnings | | $ | 14,538 | | $ | 10,006 | | $ | 5,221 | | $ | 3,256 | | $ | 4,979 |
| | | | | | | | | | | | | | | |
Adjusted Earnings per share attributable to common stockholders - diluted | | $ | 0.75 | | $ | 0.64 | | $ | 0.36 | | $ | 0.23 | | $ | 0.35 |
| | | | | | | | | | | | | | | |
Weighted average shares of common stock outstanding - diluted | | | 19,459,751 | | | 15,564,317 | | | 14,555,337 | | | 14,295,639 | | | 14,244,345 |
| | | | | | |
| | | | | | |
| | Nine months ended |
| | September 30, 2018 | | September 30, 2017 |
Net income attributable to common stockholders | | $ | 19,150 | | $ | 10,401 |
Plus: stock dividends payable to preferred stockholders | | | 6,375 | | | 503 |
Plus: stock-based compensation | | | 1,507 | | | 1,023 |
Plus: depreciation and amortization on real estate assets | | | 2,443 | | | 233 |
Plus: loss on modification of debt | | | - | | | 232 |
Plus: other expenses | | | 290 | | | - |
Adjusted Earnings | | $ | 29,765 | | $ | 12,392 |
| | | | | | |
Adjusted Earnings per share attributable to common stockholders - diluted | | $ | 1.80 | | $ | 1.12 |
| | | | | | |
Weighted average shares of common stock outstanding - diluted | | | 16,540,367 | | | 11,108,540 |
Third Quarter 2018 9
Jernigan Capital, Inc.
Schedule of Owned Properties
As of September 30, 2018
(unaudited, dollars in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | Fair Value | | | | | | | | | | | | | | | | | | | | | | | |
Location | | | | | | | | | Recognized | | | | | Projected | | Stabilized | | Stabilized | | | | | | | | | |
(MSA) | | Date | | Date | | Cash | | Through Date | | Gross | | Stabilized | | Yield on | | Yield on | | Size | | Months | | % Physical |
Address | | Opened | | Acquired | | Basis (1) | | Acquired | | Basis (2) | | NOI (3) | | Cash Basis | | Gross Basis | | (NRSF) (4) | | Open (5) | | Occupancy (5) |
Orlando 1/2 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
11920 W Colonial Dr. | | 5/1/2016 | | 8/9/2017 | | | 12,047 | | | 3,780 | | | 15,827 | | | 1,095 | | | 9.1 | % | | | 6.9 | % | | | 93,965 | | 30 | | | 86.7 | % |
Atlanta 2 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
340 Franklin Gateway SE | | 5/24/2016 | | 2/2/2018 | | | 8,766 | | | 2,900 | | | 11,666 | | | 759 | | | 8.7 | % | | | 6.5 | % | | | 66,137 | | 29 | | | 84.5 | % |
Atlanta 1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
5110 McGinnis Ferry Rd | | 5/25/2016 | | 2/2/2018 | | | 10,467 | | | 2,704 | | | 13,171 | | | 864 | | | 8.3 | % | | | 6.6 | % | | | 71,968 | | 29 | | | 83.8 | % |
Jacksonville 1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
1939 East West Pkwy | | 8/12/2016 | | 1/10/2018 | | | 8,686 | | | 2,947 | | | 11,633 | | | 709 | | | 8.2 | % | | | 6.1 | % | | | 59,847 | | 27 | | | 90.9 | % |
Pittsburgh | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
6400 Hamilton Ave | | 5/11/2017 | | 2/20/2018 | | | 7,414 | | | 1,976 | | | 9,390 | | | 688 | | | 9.3 | % | | | 7.3 | % | | | 48,024 | | 18 | | | 33.7 | % |
Charlotte 1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
9323 Wright Hill Rd | | 8/18/2016 | | 8/31/2018 | | | 10,525 | | | 2,221 | | | 12,746 | | | 869 | | | 8.3 | % | | | 6.8 | % | | | 87,380 | | 26 | | | 58.9 | % |
Total Owned Properties | | | | $ | 57,905 | | $ | 16,528 | | $ | 74,433 | | $ | 4,984 | | | 8.6 | % | | | 6.7 | % | | | | | | | | | |
| | |
| (1) | Cash basis represents the sum of the funded principal balance of the loan (net of unamortized origination fees), cash consideration (inclusive of transaction costs), assumed liabilities, and net property working capital acquired, all as of the date of acquisition. Pittsburgh cash basis also includes $468k of construction costs incurred after the date of acquisition to bring the asset to a state that will allow it to generate its projected stabilized NOI. |
| (2) | Gross basis represents cash basis as defined above plus fair value appreciation recognized through the date of acquisition. |
| (3) | Net operating income (NOI) is a non- GAAP financial measure that excludes from operating income the impact of depreciation and general and administrative expense. Projected stabilized NOI represents NOI at an expected time in the future when operations at the facility have stabilized from lease up occupancy and rental rates. |
| (4) | The net rentable square feet (“NRSF”) includes only climate controlled and non-climate controlled storage space. It does not include retail space, office space, non-covered RV space or parking spaces. |
| (5) | As of October 28, 2018. |
Third Quarter 2018 10
Jernigan Capital, Inc.
Schedule of Completed Projects
As of September 30, 2018
(unaudited, dollars in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Location | | | | | | | | Remaining | | | | | | | | | | | | | | | |
| | (MSA) | | | | | Funded | | Unfunded | | | | | | Size | | Date | | Months | | % Physical |
Closing Date | | Address | | Commitment | | Investment | | Commitment (1) | | Fair Value | | | (NRSF) (2) | | Opened | | Open (3) | | Occupancy (3) |
7/2/2015 | | Milwaukee | | | | | | | | | | | | | | | | | | | | | | | | |
| | 420 W St Paul Ave | | | 7,650 | | | 7,643 | | | 7 | | | 8,885 | | | | 81,755 | | 10/9/2016 | | 25 | | | 57.5 | % |
7/31/2015 | | New Haven | | | | | | | | | | | | | | | | | | | | | | | | |
| | 453 Washington Ave | | | 6,930 | | | 6,807 | | | 123 | | | 8,693 | | | | 64,225 | | 12/16/2016 | | 22 | | | 67.3 | % |
10/27/2015 | | Austin | | | | | | | | | | | | | | | | | | | | | | | | |
| | 251 N AW Grimes Blvd | | | 8,658 | | | 7,683 | | | 975 | | | 8,844 | | | | 77,199 | | 3/16/2017 | | 19 | | | 67.6 | % |
1/4/2017 | | New York City 1 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 1775 5th Ave | | | 16,117 | | | 16,117 | | | - | | | 21,506 | | | | 105,347 | | 9/29/2017 | | 13 | | | 53.9 | % |
8/14/2015 | | Raleigh | | | | | | | | | | | | | | | | | | | | | | | | |
| | 1515 Sunrise Ave | | | 8,792 | | | 8,351 | | | 441 | | | 8,514 | | | | 60,171 | | 3/8/2018 | | 8 | | | 23.6 | % |
11/17/2016 | | Jacksonville 2 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 45 Jefferson Rd | | | 7,530 | | | 7,034 | | | 496 | | | 8,825 | | | | 70,255 | | 3/27/2018 | | 7 | | | 29.5 | % |
1/31/2017 | | Atlanta 4 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 4676 S Atlanta Rd | | | 13,678 | | | 11,835 | | | 1,843 | | | 14,321 | | | | 105,288 | | 7/12/2018 | | 4 | | | 8.5 | % |
2/24/2017 | | Orlando 3 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 12709 E Colonial Dr | | | 8,056 | | | 7,051 | | | 1,005 | | | 8,238 | | | | 70,625 | | 7/26/2018 | | 3 | | | 10.8 | % |
4/20/2017 | | Denver 2 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 3110 S Wadsworth Blvd | | | 11,164 | | | 8,827 | | | 2,337 | | | 10,515 | | | | 74,521 | | 7/31/2018 | | 3 | | | 8.9 | % |
6/29/2017 | | Boston 1 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 329 Boston Post Rd | | | 14,103 | | | 12,311 | | | 1,792 | | | 13,581 | | | | 90,463 | | 8/8/2018 | | 3 | | | 9.1 | % |
4/14/2017 | | Louisville 1 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 2801 N Hurstbourne Pky | | | 8,523 | | | 6,029 | | | 2,494 | | | 7,260 | | | | 66,526 | | 8/15/2018 | | 2 | | | 11.9 | % |
9/20/2016 | | Charlotte 2 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 1010 E 10th St | | | 12,888 | | | 10,052 | | | 2,836 | | | 11,093 | | | | 76,985 | | 8/30/2018 | | 2 | | | 5.7 | % |
9/28/2017 | | Louisville 2 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 3415 Bardstown Rd | | | 9,940 | | | 7,220 | | | 2,720 | | | 8,644 | | | | 74,304 | | 8/31/2018 | | 2 | | | 10.4 | % |
Total Completed Development Loans | | $ | 134,029 | | $ | 116,960 | | $ | 17,069 | | $ | 138,919 | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
3/2/2018 | | Miami 6 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 590 NW 137th Ave | | | 13,370 | | | 13,370 | | | - | | | 17,179 | | | | 76,665 | | 8/12/2016 | | 27 | | | 78.2 | % |
3/2/2018 | | Miami 4 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 1103 SW 3rd Ave | | | 20,201 | | | 19,970 | | | 231 | | | 22,229 | | | | 74,685 | | 10/9/2016 | | 25 | | | 77.5 | % |
3/2/2018 | | Miami 8 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 2434 West 28th Lane | | | 13,553 | | | 13,241 | | | 312 | | | 13,325 | | | | 51,923 | | 12/12/2016 | | 23 | | | 83.3 | % |
3/2/2018 | | Miami 7 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 18460 Pines Blvd | | | 18,462 | | | 17,156 | | | 1,306 | | | 15,341 | | | | 86,880 | | 3/26/2018 | | 7 | | | 27.9 | % |
3/2/2018 | | Miami 5 | | | | | | | | | | | | | | | | | | | | | | | | |
| | 4001 NW 77th Ave | | | 17,738 | | | 16,492 | | | 1,246 | | | 13,788 | | | | 77,075 | | 8/13/2018 | | 3 | | | 5.7 | % |
Total Completed Bridge Loans | | $ | 83,324 | | $ | 80,229 | | $ | 3,095 | | $ | 81,862 | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Total Completed Projects | | $ | 217,353 | | | | | | | | | | | | | | | | | | | | | |
| | |
| (1) | Commitment is fixed during underwriting at an amount deemed sufficient to cover interest carry and excess operating expenses over rental revenue during lease-up and deferred developer’s fees (if any) payable upon stabilization. Remaining unfunded commitment on completed projects is expected to be utilized primarily for such purposes. To the extent not needed for such purposes, such commitment will not be advanced. |
| | |
| (2) | The NRSF includes only climate controlled and non-climate controlled storage space. It does not include retail space, office space, non-covered RV space or parking spaces. |
| | |
| (3) | As of October 28, 2018. |
| | |
| | |
Third Quarter 2018 11
Schedule of Projects in Progress
As of September 30, 2018
(unaudited, dollars in thousands)
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | Location | | | | | | | | Remaining | | | | | | | | | | Estimated |
| | (MSA) | | | | | Funded | | Unfunded | | | | | Size | | Construction | | C/O |
Closing Date | | Address | | Commitment | | Investment | | Commitment | | Fair Value | | (NRSF) (2) | | Start Date | | Quarter (1) |
1/18/2017 | | Atlanta 3 | | | | | | | | | | | | | | | | | | | |
| | 1484 Northside Dr NW | | | 14,115 | | | 4,751 | | | 9,364 | | | 4,642 | | | 92,935 | | Q4 2017 | | Q2 2019 |
2/24/2017 | | New Orleans | | | | | | | | | | | | | | | | | | | |
| | 2709 Severn Ave | | | 12,549 | | | 7,273 | | | 5,276 | | | 7,943 | | | 86,765 | | Q3 2017 | | Q1 2019 |
2/27/2017 | | Atlanta 5 | | | | | | | | | | | | | | | | | | | |
| | 56 Peachtree Valley Rd NE | | | 17,492 | | | 11,458 | | | 6,034 | | | 12,190 | | | 84,988 | | Q3 2017 | | Q1 2019 |
3/1/2017 | | Fort Lauderdale | | | | | | | | | | | | | | | | | | | |
| | 5601 NE 14th Ave | | | 9,952 | | | 4,854 | | | 5,098 | | | 5,389 | | | 79,279 | | Q1 2018 | | Q1 2019 |
3/1/2017 | | Houston | | | | | | | | | | | | | | | | | | | |
| | 1070 Brittmoore Rd | | | 13,630 | | | 7,233 | | | 6,397 | | | 8,637 | | | 133,035 | | Q4 2017 | | Q4 2018 |
4/20/2017 | | Denver 1 | | | | | | | | | | | | | | | | | | | |
| | 6206 W Alameda Ave | | | 9,806 | | | 5,407 | | | 4,399 | | | 5,690 | | | 60,171 | | Q1 2018 | | Q1 2019 |
5/2/2017 | | Atlanta 6 | | | | | | | | | | | | | | | | | | | |
| | 2033 Monroe Dr | | | 12,543 | | | 9,521 | | | 3,022 | | | 11,364 | | | 81,170 | | Q2 2017 | | Q4 2018 (3) |
5/2/2017 | | Tampa 2 | | | | | | | | | | | | | | | | | | | |
| | 9185 Ulmerton Rd | | | 8,091 | | | 3,440 | | | 4,651 | | | 3,409 | | | 71,400 | | Q1 2018 | | Q1 2019 |
5/19/2017 | | Tampa 3 | | | | | | | | | | | | | | | | | | | |
| | 2460 S Falkenburg Rd | | | 9,224 | | | 5,786 | | | 3,438 | | | 6,535 | | | 70,888 | | Q3 2017 | | Q4 2018 |
6/12/2017 | | Tampa 4 | | | | | | | | | | | | | | | | | | | |
| | 3201 32nd Ave S | | | 10,266 | | | 7,857 | | | 2,409 | | | 10,053 | | | 73,500 | | Q4 2017 | | Q4 2018 (3) |
6/19/2017 | | Baltimore | | | | | | | | | | | | | | | | | | | |
| | 1835 Washington Blvd | | | 10,775 | | | 7,476 | | | 3,299 | | | 8,037 | | | 84,700 | | Q3 2017 | | Q4 2018 |
6/28/2017 | | Knoxville | | | | | | | | | | | | | | | | | | | |
| | 7807 Kingston Pike | | | 9,115 | | | 6,186 | | | 2,929 | | | 6,684 | | | 72,281 | | Q3 2017 | | Q4 2018 |
6/30/2017 | | New York City 2 | | | | | | | | | | | | | | | | | | | |
| | 465 W 150th St | | | 26,482 | | | 22,397 | | | 4,085 | | | 22,905 | | | 40,593 | | Q4 2017 | | Q4 2018 |
7/27/2017 | | Jacksonville 3 | | | | | | | | | | | | | | | | | | | |
| | 2004 Edison Ave | | | 8,096 | | | 5,472 | | | 2,624 | | | 6,496 | | | 68,050 | | Q4 2017 | | Q4 2018 |
8/30/2017 | | Orlando 4 | | | | | | | | | | | | | | | | | | | |
| | 9001 Eastmar Commons | | | 9,037 | | | 4,749 | | | 4,288 | | | 5,214 | | | 77,125 | | Q1 2018 | | Q1 2019 |
9/14/2017 | | Los Angeles 1 | | | | | | | | | | | | | | | | | | | |
| | 943-959 W Hyde Park Blvd | | | 28,750 | | | 8,180 | | | 20,570 | | | 7,838 | | | 120,038 | | Q1 2019 | | Q3 2020 |
9/14/2017 | | Miami 1 | | | | | | | | | | | | | | | | | | | |
| | 4250 SW 8th St | | | 14,657 | | | 5,940 | | | 8,717 | | | 5,576 | | | 69,175 | | Q2 2018 | | Q3 2019 |
10/12/2017 | | Miami 2 | | | | | | | | | | | | | | | | | | | |
| | 880 W Prospect Rd | | | 9,459 | | | 1,087 | | | 8,372 | | | 834 | | | 58,000 | | Q1 2019 | | Q2 2020 |
10/30/2017 | | New York City 3 | | | | | | | | | | | | | | | | | | | |
| | 5203 Kennedy Blvd | | | 14,701 | | | 4,222 | | | 10,479 | | | 3,752 | | | 68,660 | | Q4 2017 | | Q4 2019 |
11/16/2017 | | Miami 3 | | | | | | | | | | | | | | | | | | | |
| | 120-132 NW 27th Ave | | | 20,168 | | | 3,912 | | | 16,256 | | | 3,315 | | | 96,295 | | Q4 2018 | | Q1 2020 |
11/21/2017 | | Minneapolis 1 | | | | | | | | | | | | | | | | | | | |
| | 2109 University Ave W | | | 12,674 | | | 1,307 | | | 11,367 | | | 1,157 | | | 88,838 | | Q2 2018 | | Q3 2019 |
12/1/2017 | | Boston 2 | | | | | | | | | | | | | | | | | | | |
| | 10 Hampshire Rd | | | 8,771 | | | 2,313 | | | 6,458 | | | 2,271 | | | 76,710 | | Q4 2017 | | Q1 2019 |
12/15/2017 | | New York City 4 | | | | | | | | | | | | | | | | | | | |
| | 6 Commerce Center Dr | | | 10,591 | | | 1,469 | | | 9,122 | | | 1,312 | | | 78,425 | | Q2 2018 | | Q4 2019 |
12/27/2017 | | Boston 3 | | | | | | | | | | | | | | | | | | | |
| | 19 Coolidge Hill Rd | | | 10,174 | | | 2,519 | | | 7,655 | | | 2,333 | | | 62,700 | | Q4 2018 | | Q1 2020 |
12/28/2017 | | New York City 5 | | | | | | | | | | | | | | | | | | | |
| | 375 River St | | | 16,073 | �� | | 5,796 | | | 10,277 | | | 5,613 | | | 90,200 | | Q4 2018 | | Q4 2019 |
2/8/2018 | | Minneapolis 2 | | | | | | | | | | | | | | | | | | | |
| | 3216 Winnetka Ave N | | | 10,543 | | | 5,720 | | | 4,823 | | | 5,962 | | | 83,026 | | Q2 2018 | | Q1 2019 |
3/30/2018 | | Philadelphia | | | | | | | | | | | | | | | | | | | |
| | 550 Allendale Rd | | | 14,338 | | | 4,691 | | | 9,647 | | | 4,374 | | | 69,383 | | Q2 2018 | | Q3 2019 |
4/6/2018 | | Minneapolis 3 | | | | | | | | | | | | | | | | | | | |
| | 101 American Blvd West | | | 12,883 | | | 2,681 | | | 10,202 | | | 2,532 | | | 86,075 | | Q3 2018 | | Q4 2019 |
5/1/2018 | | Miami 9 | | | | | | | | | | | | | | | | | | | |
| | 10651 W Okeechobee Rd | | | 12,421 | | | 2,626 | | | 9,795 | | | 2,369 | | | 70,538 | | Q1 2019 | | Q4 2019 |
5/15/2018 | | Atlanta 7 | | | | | | | | | | | | | | | | | | | |
| | 2915 Webb Rd | | | 9,418 | | | 117 | | | 9,301 | | | 23 | | | 76,519 | | Q3 2018 | | Q3 2019 |
5/23/2018 | | Kansas City | | | | | | | | | | | | | | | | | | | |
| | 510 Southwest Blvd | | | 9,968 | | | 525 | | | 9,443 | | | 423 | | | 77,188 | | Q3 2018 | | Q4 2019 |
Third Quarter 2018 12
6/7/2018 | | Orlando 5 | | | | | | | | | | | | | | | | | | | |
| | 7212 W Sand Lake Rd | | | 12,969 | | | - | | | 12,969 | | | - | | | 76,147 | | Q4 2018 | | Q4 2019 |
6/12/2018 | | Los Angeles 2 | | | | | | | | | | | | | | | | | | | |
| | 7855 Haskell Ave | | | 9,298 | | | 4,518 | | | 4,780 | | | 4,484 | | | 116,022 | | Q3 2019 | | Q4 2020 |
Total Projects in Progress | | $ | 419,029 | | $ | 171,483 | | $ | 247,546 | | $ | 179,356 | | | | | | | |
| | |
| (1) | Estimated C/O dates represent the Company’s best estimate as of September 30, 2018 based on project specific information learned through underwriting and communications with respective developers. These dates are subject to change due to unexpected project delays/efficiencies. |
| (2) | The NRSF includes only climate controlled and non-climate controlled storage space. It does not include retail space, office space, non-covered RV space or parking spaces. |
| (3) | This facility received a temporary C/O or C/O subsequent to September 30, 2018. |
Third Quarter 2018 13
Schedule of Heitman JV Development Projects Completed and in Progress
As of September 30, 2018
(unaudited, dollars in thousands)
Development Projects Completed:
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | Location | | | | | | | | Remaining | | | | | | | | | | | | | | |
| | (MSA) | | | | | Funded | | Unfunded | | | | | Size | | Date | | Months | | % Physical |
Closing Date | | Address | | Commitment | | Investment | | Commitment (1) | | Fair Value | | (NRSF) (2) | | Opened | | Open (3) | | Occupancy (3) |
7/19/2016 | | Jacksonville | | | | | | | | | | | | | | | | | | | | | | | |
| | 3211 San Pablo Rd S | | | 8,127 | | | 7,422 | | | 705 | | | 11,677 | | | 80,621 | | 7/26/2017 | | 15 | | | 77.6 | % |
9/28/2016 | | Columbia | | | | | | | | | | | | | | | | | | | | | | | |
| | 401 Hampton St | | | 9,199 | | | 8,715 | | | 484 | | | 9,741 | | | 70,935 | | 8/23/2017 | | 14 | | | 51.7 | % |
8/15/2016 | | Atlanta 2 | | | | | | | | | | | | | | | | | | | | | | | |
| | 11220 Medlock Bridge Rd | | | 8,772 | | | 8,121 | | | 651 | | | 8,878 | | | 70,189 | | 9/14/2017 | | 13 | | | 45.0 | % |
4/15/2016 | | Washington DC | | | | | | | | | | | | | | | | | | | | | | | |
| | 1325 Kenilworth Ave NE | | | 17,269 | | | 16,713 | | | 556 | | | 19,771 | | | 90,115 | | 9/25/2017 | | 13 | | | 53.7 | % |
8/25/2016 | | Denver | | | | | | | | | | | | | | | | | | | | | | | |
| | 2255 E 104th Ave | | | 11,032 | | | 10,123 | | | 909 | | | 12,610 | | | 85,575 | | 12/14/2017 | | 10 | | | 49.5 | % |
5/14/2015 | | Miami 1 | | | | | | | | | | | | | | | | | | | | | | | |
| | 490 NW 36th St | | | 13,867 | | | 12,039 | | | 1,828 | | | 14,354 | | | 75,770 | | 2/23/2018 | | 8 | | | 34.6 | % |
4/29/2016 | | Atlanta 1 | | | | | | | | | | | | | | | | | | | | | | | |
| | 1801 Savoy Dr | | | 10,223 | | | 9,575 | | | 648 | | | 10,767 | | | 71,150 | | 4/12/2018 | | 7 | | | 27.1 | % |
12/22/2016 | | Raleigh | | | | | | | | | | | | | | | | | | | | | | | |
| | 7710 Alexander Town Blvd | | | 8,877 | | | 8,163 | | | 714 | | | 9,745 | | | 64,103 | | 6/8/2018 | | 5 | | | 16.1 | % |
9/25/2015 | | Fort Lauderdale | | | | | | | | | | | | | | | | | | | | | | | |
| | 812 NW 1st St | | | 13,230 | | | 11,608 | | | 1,622 | | | 15,009 | | | 87,384 | | 7/26/2018 | | 3 | | | 10.9 | % |
Total Completed Development Projects | | $ | 100,596 | | $ | 92,479 | | $ | 8,117 | | $ | 112,552 | | | | | | | | | | | |
| | |
| (1) | Commitment is fixed during underwriting at an amount deemed sufficient to cover interest carry and excess operating expenses over rental revenue during lease-up and deferred developer’s fees (if any) payable upon stabilization. Remaining unfunded commitment on completed projects is expected to be utilized primarily for such purposes. To the extent not needed for such purposes, such commitment will not be advanced. |
| | |
| (2) | The NRSF includes only climate controlled and non-climate controlled storage space. It does not include retail space, office space, non-covered RV space or parking spaces. |
| | |
| (3) | As of October 28, 2018. |
| | |
| | |
Development Projects In Progress:
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | Location | | | | | | | | Remaining | | | | | | | | | | Estimated |
| | (MSA) | | | | | Funded | | Unfunded | | | | | Size | | Construction | | C/O |
Closing Date | | Address | | Commitment | | Investment | | Commitment | | Fair Value | | (NRSF) (2) | | Start Date | | Quarter (1) |
5/14/2015 | | Miami 2 | | | | | | | | | | | | | | | | | | | |
| | 1100 NE 79th St | | | 14,849 | | | 13,622 | | | 1,227 | | | 15,202 | | | 74,113 | | Q2 2016 | | Q4 2018 (3) |
7/21/2016 | | New Jersey | | | | | | | | | | | | | | | | | | | |
| | 10 Central Ave | | | 7,828 | | | 4,403 | | | 3,425 | | | 4,803 | | | 59,020 | | Q2 2017 | | Q4 2018 |
Total Development Projects in Progress | | $ | 22,677 | | $ | 18,025 | | $ | 4,652 | | $ | 20,005 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Total Heitman JV Investments | | $ | 123,273 | | $ | 110,504 | | $ | 12,769 | | $ | 132,557 | | | | | | | |
| | |
| (1) | Estimated C/O dates represent the Company’s best estimate as of September 30, 2018 based on project specific information learned through underwriting and communications with respective developers. These dates are subject to change due to unexpected project delays/efficiencies. |
| (2) | The NRSF includes only climate controlled and non-climate controlled storage space. It does not include retail space, office space, non-covered RV space or parking spaces. |
| (3) | This facility received a temporary C/O or C/O subsequent to September 30, 2018. |
Third Quarter 2018 14
Closed Investments by Geography
As of September 30, 2018
Third Quarter 2018 15
Capital Sources and Investment Uses
As of September 30, 2018
(dollars in millions)
| | | |
| | | |
Estimated Capital to be Used in Investing Activities (1) | | | |
Contractual investment obligations: | | | |
Development property investments | | $ | 265 |
Bridge loan investments | | | 3 |
Self-storage real estate venture | | | 1 |
Total Committed Investments | | $ | 269 |
Remaining Prospective Commitments per FY 2018 guidance: | | | 40 |
Total to Fund Investments | | $ | 309 |
| | | |
| | | |
Estimated Sources of Capital | | | |
Cash and Cash Equivalents as of September 30, 2018 | | $ | 43 |
Identified loan repayment (expected in Q4 2018) | | | 17 |
Identified secured debt on one wholly-owned property (expected in Q4 2018) | | | 8 |
Remaining credit facility capacity (2) | | | 200 |
Remaining capital needs | | | 41 |
Total Sources | | $ | 309 |
| | |
| (1) | Does not include financing spend, positive operating cash flow or any additional purchases of developers’ interest. |
| (2) | Assumes our ability to increase the capacity under our Credit Facility through the exercise of the accordion feature. As of September 30, 2018, $81.5 million was available for borrowing under the Credit Facility. |
The company may use any combination of the following capital sources to fund its $41 million of remaining capital needs:
| · | | Refinancing of JCAP mortgage indebtedness (49.9% profits interest and ROFR retained) - $60 million to $70 million |
| · | | Potential sales of current investments that JCAP does not wish to own or acquire - $20 million |
| · | | Series B preferred ATM issuances - $10 million |
| · | | Common stock issuances (ATM) - $20 million |
| · | | Secured debt on individual properties - $5 million to $10 million |
| · | | Joint venture financing proceeds - $5 million to $10 million |
Timing of Funding $309 million of Remaining Commitments
Third Quarter 2018 16
Capital Structure
As of September 30, 2018
(dollars in millions)
| | | |
| | | |
Credit Facility Outstanding | | $ | - |
Term Loans | | | 25 |
Series A Preferred Stock | | | 125 |
Series B Preferred Stock | | | 39 |
Common Stock | | | 374 |
Total Capital | | $ | 563 |
Third Quarter 2018 17
Jernigan Capital, Inc.
Company Information
| | | |
Corporate Headquarters | Trading Symbol | Investor Relations | Information Requests |
6410 Poplar Avenue | Common shares: JCAP | 6410 Poplar Avenue | To request an Investor Relations |
Suite 650 | 7.00% Series B Preferred Stock: JCAP- | Suite 650 | package or annual report, please |
Memphis, TN 38119 | PR B | Memphis, TN 38119 | visit our website at |
901.567.9510 | Stock Exchange Listing | 901.567.9510 | www.jernigancapital.com |
| New York Stock Exchange | | |
Executive Management
| |
Dean Jernigan | John A. Good |
Executive Chairman | Chief Executive Officer |
| |
Jonathan Perry | David Corak |
President and Chief Investment Officer | Senior Vice President of Corporate Finance |
| |
Kelly P. Luttrell | |
Senior Vice President, Chief Financial Officer, Treasurer and Corporate Secretary | |
Independent Directors
| |
Mark O. Decker | James D. Dondero |
Director | Director |
| |
Howard A. Silver | Harry J. Thie |
Director | Director |
Equity Research Coverage
| |
Baird Equity Research | B. Riley FBR |
RJ Milligan | Tim Hayes |
rjmilligan@rwbaird.com | timothyhayes@brileyfbr.com |
| |
Jefferies LLC | KeyBanc Capital Markets |
Omotayo Okusanya | Todd M. Thomas |
tokusanya@jefferies.com | tthomas@key.com |
| |
Raymond James & Associates | |
Jonathan Hughes | |
jonathan.hughes@raymondjames.com | |
Any opinions, estimates, forecasts or predictions regarding Jernigan Capital’s performance made by these analysts are theirs alone and do not represent opinions, estimates, forecasts or predictions of Jernigan Capital or its management. Jernigan Capital does not by its reference above or distribution imply its endorsement of or concurrence with such opinions, estimates, forecasts or predictions.
Third Quarter 2018 18
