Whitestone REIT (WSR) Nareit REIT Week: 2024 Investor Conference summary

Company overview and differentiation

• Focuses on open-air retail centers in Texas and Arizona, targeting high-growth Sun Belt markets.

• Centers are convenience-focused with a tenant mix emphasizing food, self-care, health, fitness, financial, logistics, education, and entertainment.

• Majority of tenants are small businesses occupying less than 10,000 sq ft, making up 75% of revenue.

• Emphasizes community connections and local knowledge, leveraging technology to understand consumer needs.

• Benefited from pandemic-driven shifts toward suburban, neighborhood-based retail.

Leadership transition and strategic changes

• CEO transition in early 2022 led to a 50% change in the executive team, including the former CEO.

• Focused on operational excellence, increasing occupancy by over 230 basis points since Q4 2021.

• Improved tenant quality and revenue, with average base rent up 15% and eight consecutive quarters of nearly 20% leasing spreads.

• Enhanced shareholder relations through governance changes, board refreshment, and poison pill elimination.

• Reduced net debt to EBITDA from 10.2x to 7.8x, targeting 6.6-7x by year-end, aided by exiting a non-performing JV.

Portfolio performance and growth outlook

• Forecasting 11% FFO per share growth for the year, with most debt maturities locked in through 2027.

• Supply-demand fundamentals are strong, supporting continued earnings growth projections for 2025 and 2026.

• Achieved 5.3% same-store NOI growth since 2022, with ongoing 3-4% annual growth translating to about 7% FFO growth per share.

• Actively manages tenant mix to optimize traffic and revenue, focusing on best-in-class operators.