EXHIBIT 99.1
[LOGO OF REGENCY REALTY APPEARS HERE]
[Collage of Color Photographs of Shopping Centers]
The First National Operating, Ownership and Services Company
Focused on Grocery-Anchored Infill Retail Centers
[LOGO OF REGENCY REALTY APPEARS HERE]
In addition to historical information, this presentation contains
forward-looking statements under the Federal Securities Law. These statements
are based on current expectations, estimates, and propositions about the
industry and markets in which Pacific Retail Trust and Regency Realty operate,
management's beliefs and assumptions made by management.
Forward-looking statements are not guarantees of future performance and involve
certain credit risks and uncertainties, which are difficult to predict.
Actual operating results may be affected by changes in national and local
economic conditions, competitive market conditions, weather, obtaining
government approvals, and meeting development schedules, and therefore may
differ materially from what is expressed or forecasted in the presentation.
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SUMMARY OF MERGER
. Share Exchange Ratio 0.48:1.0
. Name Regency Realty Corporation
. Total Market Capitalization(1) $2.030 Billion
. Total Book Assets $2.184 Billion
. Board Composition 4 Independent from Regency, 3 Independent
from Pacific Retail, 3 from Management, 3
from Security Capital U.S. Realty
. Senior Management Martin Stein, Jr. - Chairman and Chief
Executive Officer
Mary Lou Rogers - President and Chief
Operating Officer
. Headquarters Jacksonville, Florida
. Regional Offices Atlanta, Cincinnati, Denver, Dallas, Los
Angeles, St. Louis, San Francisco, Seattle
. Proposed Time Table Joint Proxy Statement filed -- October 9,
1998
Mail Joint Proxy Statement to Shareholders --
November 13, 1998
Shareholder Vote / Closing -- December 1998
(1) Equity market capitalization based on October 9, 1998 share price of $20.50.
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RATIONALE FOR MERGER
. Favorable financial impact
. Enhanced and more sustainable FFO growth rate
. Strengthened capital structure
. Immediate and long-term accretion
. Creates a national platform
. Grocery-anchored infill strategy
. Research-based Retail Operating System
. Customer-driven development program
. Enhanced management team
. Similar systems and cultures
. Operating and development capabilities
. Customer relationships
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FINANCIAL IMPACT OF MERGER
. Higher FFO growth rate
. Strengthened capital structure
. Doubles total book assets to $2.2 billion
. Reduces debt from 35.8% to 30.7%
. Provides $600 million of credit capacity
. Immediate and long-term accretion
. Financial and operating synergies of $5.1 million
. FFO accretion of $0.03 in 1999 and $0.06 in 2000
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CREATING A NATIONAL PLATFORM
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194 Centers Operating or Under Development
$2.2 Billion Total Assets
22.5 Million Square Feet
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[Map indicating locations of Regency and Pacific
Retail Properties and Targeted Markets]
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NEIGHBORHOOD INFILL RETAIL CENTERS
------
[Aerial Photograph of [Color photograph of [Illustration of
Shopping Center Kroger Anchor Store] Shopping Center
Location] Layout]
Protected Infill Necessity-driven Retenanting/
------ Demand Remerchandising
Locations (Grocery Anchors) Opportunities
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Research-Driven Investment Strategy
Regency National
Average/(1)/ Average
------------ --------
Population 75,000 N/A
Average Household Income $66,660 $53,473
Projected 5-Year Population Growth 10.4% 4.3%
(1) For population within 3-mile radius of Regency retail centers. Includes
Pacific Retail centers.
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Attractive Trade Area Demographics
[Color photograph of Hyde Primary Trade Area Analysis
Park Kroger] ---------------------------
Household Income $55,245
Case Study: Hyde Park Plaza Population 113,185
Cincinnati, Ohio Kroger/Thriftway Sales $68.2 Million
Weekly Shopper Visits 43,400
[Color Map of
Hyde Park
Trade Area]
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DOMINANT GROCERS = FRANCHISE VALUE
Primary Trade Area (PTA)
. Grocer is primary traffic generator
. Consumers average 2.2 trips per week to
[Color Map Showing grocery store
North Hills Primary
Trade Area] . Focus on dominant grocers in the
submarket (ranked #1 or #2 in PTA)
. Target grocery chain's top stores
North Hills Plaza ---
Austin, Texas
Note: Ranked by gross sales.
Source: Trade Dimensions.
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DOMINANT GROCERS = FRANCHISE VALUE
Number of Regency Chain
Stores Average/(1)(2)/ Average/(2)(3)/
--------- --------------- ---------------
Publix 25 $22,623 $19,534
Kroger 23 $25,536 $17,336
Safeway/Vons 18 $23,777 $15,547
Winn-Dixie 14 $12,827 $11,700
Tom Thumb/Randall's 10 $24,099 $20,211
Albertsons/Max Foods 9 $18,034 $17,076
Fred Meyer/QFC/Ralphs/
Food 4 Less/Hughes 7 $19,992 $15,661
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AVERAGE/(4)/ $21,000 $17,500
$21 Million Annual Sales Translates into 14,000 Shopper Visits Each Week
(1) Based on stores reporting sales.
(2) In thousands.
(3) Source: Trade Dimensions and companies' financial reports.
(4) Includes all stores in portfolio reporting sales.
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DOMINANT GROCERS = FRANCHISE VALUE
Regency Chain
Average/(1)/ Average/(2)/
Number of (Per Square (Per Square
Stores Foot) Foot)
--------- ------------ ------------
Publix 25 $518.98 $436.00
Kroger 23 $438.02 $403.00
Safeway/Vons 18 $554.11 $495.08
Winn-Dixie 14 $286.94 $278.00
Tom Thumb/Randall's 10 $466.85 $457.13
Albertsons/Max Foods 9 $356.73 $417.60
Fred Meyer/QFC/Ralphs/
Food 4 Less/Hughes 7 $415.81 $419.58
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AVERAGE/(3)/ $437,09 $398.21
(1) Based on stores reporting sales.
(2) Source: Trade Dimensions and companies' financial reports.
(3) Includes all stores in portfolio reporting sales.
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Cycle-Resistant Property Type
. Grocery anchors
Grocery Sales
. Provide daily use goods
. Sustainable sales per square foot
. Credit tenants
. Long-term leases [Graph Showing Amount of Grocery Sales
By Year]
. Limited supply
. Infill locations
. Highly fragmented industry
. Lack of institutional capital
Source: Progressive Grocer Annual Report.
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Adding Value through Retenanting/
Remerchandising Opportunities
Trade Area Analysis Remerchandising Plan
[Color Map Showing Northeast [Illustration Showing Casa Linda
Dallas Trade Area] Remerchandising Plan]
Northeast Dallas Casa Linda Plaza
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Creating Value through Regency's
Preferred Customer Initiative
. Multiple locations with 79 leading retailers nationwide
. Regency's PCI program builds a national brand
. National roll-out of innovative new retail concepts
[Color Photographs of Preferred Customer Signs]
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CUSTOMER-DRIVEN DEVELOPMENT
. $446 million developments/redevelopments
. Development driven by leading
grocery anchors
. 50%-75% pre-leasing
before construction
------ [Map Showing
Development Property Locations]
. 10.5%+ average yield
on current development
projects
. 11 Kroger-anchored shopping center
developments in process or under contract
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Customer-Driven Redevelopment
. Excellent infill location in high-growth market
. Anticipated completion in February 1999
[Aerial Photograph of
Roswell Village] . Projected stabilized yield of 10.5%
. 6 additional Publix-anchored shopping center
developments in process or under contract
[Illustration of Roswell Village]
Roswell Village
Roswell (Atlanta), Georgia
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THIRD-PARTY SERVICES
23 Eckerd build-to-suits in process
or under contract
[Color Photograph of Eckerd Store]
[Color Photograph of Stein Mart]
16 new stores identified
or opened for Stein Mart in 1998
Generating $7 million of gross profits in 1998
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FFO PER SHARE GROWTH
[Bar Graph Showing FFO Per Share Growth By Year]
(1) First Call consensus estimates.
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ATTRACTIVE VALUATION/(1)/
1999 FFO Multiples
[Bar Graph Showing Peer Group FFO Multiples]
(1) Stock prices as of October 9, 1998. First Call consensus estimates.
$23 Stock Price at 9.3x Average Multiple for Peer Group
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EXPERIENCED MANAGEMENT TEAM
Name Title Years in Industry
---- ----- -----------------
Martin E. Stein, Jr. Chairman and Chief Executive Officer 21
Mary Lou Rogers President and Chief Operating Officer 20
Bruce Johnson Chief Financial Officer 26
James Buis Managing Director - Investments Southwest 26
John Delatour Managing Director - Operations West 15
Bob Gillander Managing Director - Investments Atlantic 19
Brian Smith Managing Director - Investments Pacific 15
Jim Thompson Managing Director - Operations East 17
Lee Wielansky Managing Director - Investments Midwest 15
Total of 40 Officers with an Average of 18 Years Experience
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[Color Photograph Collage of Shopping Centers]
THE FIRST NATIONAL OPERATING, OWNERSHIP AND SERVICES COMPANY
FOCUSED ON GROCERY-ANCHORED INFILL RETAIL CENTERS
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FINANCIAL SUMMARY/(1)/
In thousands
(except per share data) Regency Pacific Combined
------- ------- --------
Total Book Assets $1,139,258 $1,045,040 $2,184,298
Equity Market Capitalization/(2)/ $ 681,759 $ 749,712 $1,278,905
Common Shares Outstanding/(3)/ 29,722 68,048 62,386
Preferred Stock $ 80,000 $ 0 $ 80,000
Line of Credit Outstanding $ 89,731 $ 173,600 $ 263,331
Term Debt $ 317,796 $ 90,236 $ 408,032
Total Debt/Total Book Assets 35.8% 25.3% 30.7%
Dividend Per Share $ 1.76 $ 0.76 $ 1.76
Fully Diluted FFO Per Share/(4)/ $ 2.25 $ 1.01 NA
Payout Ratio 78.2% 75.3% 75 - 78%
(1) As of June 30, 1998.
(2) Equity market capitalization based on October 9, 1998 share price of $20.50.
(3) Includes redeemable operating partnership units outstanding and Pacific
Retail's preferred stock which is convertible 1:1.
(4) Regency Realty FFO based on First Call consensus estimate.
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IMPLIED CAPITALIZATION RATE FOR PACIFIC RETAIL/(1)/
Common Stock/(2)/ $ 727.75
Preferred Stock and Total Liabilities 308.40
---------
Total Asset Value $1,036.15
Development Pipeline (15.25)
Third Party and For Sale Assets (6.23)
Other Assets/(3)/ (17.08)
Total Cost of Shopping Centers $ 997.59
---------
Adjusted Net Operating Income $ 89.74
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NOI YIELD/CAPITALIZATION RATE 9.0%
(1) As of June 30, 1998. In millions, except percentages.
(2) Includes redeemable operating partnership units.
(3) Includes land held for future development, value of tax-exempt debt, and
other assets.
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MERGER = ECONOMIC VALUE ADDED
Pacific Retail Initial NOI Yield 9.2%
Expected NOI Growth Rate 3.0%
----
Total Unleveraged Return 12.2%
Regency Long-Term Cost of Capital:
Equity 13.5%
Debt 7.5%
----
Total Cost of Capital (60% equity, 40% debt) 11.1%
Total Return in Excess of Cost of Capital 110 bps
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Current Valuation = Discount Net Asset Value/(1)/
Adjusted Net Operating Income $ 192.16
Capitalization Rate/(2)/ 8.88%
---------
Value of Operating Properties $2,163.60
Development Pipeline $ 27.25
Third Party and For Sale Assets 59.24
Other Assets/(3)/ 55.35
---------
Total Value of Assets $ 141.84
Preferred Stock and Liabilities (816.36)
---------
Net Asset Value $1,489.08
Fully Diluted Common Shares 60.92
---------
Net Asset Value Per Share $ 24.44
Share Price (as of October 9, 1998) $ 20.50
Premium/(Discount) to Net Asset Value (19.2%)
(1) As of June 30, 1998. In millions, except per share amounts and
percentages.
(2) Blended cap rate of 9.00% for Regency's properties and 8.75% for Pacific's
properties.
(3) Includes investments in unconsolidated partnerships, cash and cash
equivalents and other tangible assets.
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Sustainable Growth at a Compelling Price
1999 FFO '97-'99 FFO FFO
Multiple/(1)/ CAGR/(1)/ Growth Ratio
------------- ----------- ------------
REGENCY 8.3x 12.0% 0.69x
Kimco 9.9x 16.7% 0.59x
New Plan Excel 9.1x 14.3% 0.63x
Developers Diversified 7.9x 11.3% 0.70x
Weingarten 10.5x 7.8% 1.35x
Federal Realty 9.3x 5.9% 1.57x
------ ------ -----
Peer Group Average 9.3x 11.2% 0.97x
(1) Stock prices as of October 9, 1998. First Call consensus estimates.
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CAPITALIZATION MEASURES/(1)/
Equity Debt to Total Floating Rate Fixed Charge
Market Value Market Debt to Total Coverage
in Millions Capitalization Market Capitalization Ratio/(2)/
------------ -------------- --------------------- ------------
REGENCY $1,278.9 33.1% 8.7%/(3)/ 4.1x
Kimco $2,118.6 28.4% 0.6% 3.0x
New Plan $2,078.9 27.1% 0.0% 3.7x
Weingarten $1,088.3 30.0% 6.2% 3.4x
Federal Realty $ 853.3 42.9% 7.0% 2.3x
Developers Diversified $ 983.3 40.9% 7.3% 2.4x
(1) Based on Q2 financial information. Stock prices as of October 9, 1998.
(2) Based on "Comparative Valuation of REITs," Merrill Lynch & Co., October 7,
1998.
(3) Adjusted for July 1998 $100 million debt offering.
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SECURITY CAPITAL U.S. REALTY OWNERSHIP/(1)/
Value of Investment
------------------------------------
Percent Before
Shares Ownership Announcement/(2)/ Current/(3)(4)/
------ --------- ----------------- ---------------
Pacific Retail 47.0 69.0% $610.8 $462.3
Regency 11.7 39.4 274.7 240.3
---- ---- ------ ------
Total/(4)/ 34.3 54.9% $885.5 $702.6
(1) In millions, except percentages.
(2) Based on September 23, 1998 stock price of $23.4375 for Regency and $13.00
stock price of last equity offering for Pacific Retail.
(3) Based on October 9, 1998 stock price of $20.50.
(4) Exchange ratio of 0.48 applied to Pacific Retail shares.
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Retail Merger Analysis
Implied FFO/(2)/
Company Premium/(1)/ Multiple Paid Accretion/(3)/
------- ----------- --------------- ---------
Regency/Pacific Retail N/A 9.2x 1.2%
Kimco/Price 9.8% 11.6x 4.6%
New Plan/Excel 33.1% 15.8x (4.0)%
Bradley/Mid-America (12.4)% 2.7x 2.7%
----------- ------------- ---------
Average 10.2% 10.0x 1.1%
(1)Based on average closing share prices for the 30 days prior to transaction
announcement.
(2)FFO multiples are based on analysts' consensus for the calendar year
following the merger announcement.
(3)Based on analysts' consensus estimates and accretion amounts provided by
management for the first full year of operations following the merger
announcement.
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Capital Allocation by Market
% of
Committed % of Committed
Market GLA Investment/(1)/ Total GLA Investment
------ ----- --------------- --------- ----------
Southern California 2,486,531 $ 347,757,701 10.2% 14.2%
Northern California 1,259,905 191,997,799 5.2% 7.8%
Pacific Northwest 1,406,804 188,494,096 5.8% 7.7%
Colorado/Arizona 1,197,043 104,111,994 4.9% 4.2%
Texas 3,724,736 358,005,912 15.2% 14.6%
Midwest 2,589,631 244,860,418 10.6% 10.0%
Mid-Atlantic 520,479 48,576,019 2.1% 2.0%
Southeast 5,396,266 519,377,514 22.1% 21.2%
Florida 5,842,915 450,081,670 23.9% 18.3%
---------- -------------- ------ ------
24,424,310 $2,453,263,123 100.0% 100.0%
========== ============== ====== ======
As of 6/30/98
(1) Includes future contract commitments.
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REGENCY IS THE ONLY NATIONAL COMPANY FOCUSED ON
GROCERY-ANCHORED CENTERS
Percent
Geographic Major Product Percent Grocery
Focus Markets Focus Retail/(1)/ Anchor/(2)/
---------- ------- ------------ ----------- -----------
REGENCY NATIONAL FL, CA, TX, NEIGHBORHOOD 100% 87%
GA, OH, NC INFILL
Kimco National FL, PA, IL, Community/ 98% 24%
TX, OH Neighborhood
Developers Diversified Midwest/ OH, FL, MO Power/Community 99% 52%
Southeast
Weingarten Southwest TX Community/ 81% N/A
Neighborhood
New Plan Excel National GA, NY, OH Power/Community 74%/(3)/ N/A
CA, NC, FL, TN
Federal Realty National MD, VA, NJ, PA Neighborhood/ 100% 50%
Community/"Mainstreet"
(1) Percent of total portfolio.
(2) Percent of retail component of total portfolio.
(3) Includes 52 apartment communities comprised of 12,400 units (assumption of
1,000 square feet per unit).
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REGENCY WILL PLAY KEY ROLE IN CONTINUED
CONSOLIDATION OF GROCERY BUSINESS
Actual 1997 Estimated 2002 Top 10 Food Retailers' Market Share
Top U.S. Food Retailers Market Share Market Share
- ----------------------- ------------ --------------
Albertson's(15) 3.2% 8.7%
American Stores* 4.2
Safeway(18) 5.0 7.7
Wal-Mart 2.4 7.7
Kroger(33) 5.9 6.6
Ahold USA 3.2 5.4
Fred Meyer(8) 1.2 4.9
Publix(33) 2.5 3.2
Winn Dixie(17) 3.0 3.2
Food Lion(2) 2.2 2.8
A&P(3) 2.3 2.1
H.E.B.(2) 1.1 1.3
---- ----
36.2% 53.6%
[Bar Graph Showing Top Food Retailers Market Share By Country]
Source: Harvard Business School; Merrill Lynch & Co.
* To be purchased by Albertson's.
Source: Merrill Lynch & Co.
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ENHANCED BALANCE SHEET/(1)/
Pre-Merger Post-Merger
$1,096.8 Million $2,030.3 Million
[Pie Graph Showing Pre-Merger [Pie Graph Showing Post-Merger
Debt and Equity] Debt and Equity]
Provides $600 Million of Credit Capacity
(1) Stock price as of October 9, 1998.