NEXUS REIT BUILDING THE
FOUNDATION FOR THE NEXT CANADIAN
“BLUE CHIP” REIT
ANNUAL GENERAL MEETING
June 28, 2017NEXUS REAL ESTATE INVESTMENT TRUST
2INVESTOR PRESENTATION | JUNE 2017NEXUS
ABOUT THIS PRESENTATION
No reliance may be placed for any purpose whatsoever on the information contained in this presentation or the completeness or accuracy of such information. Norepresentation or warranty, express or implied, is given by or on behalf of Nexus REIT (the “REIT”), or its unitholders, trustees, officers or employees or any otherperson as to the accuracy or completeness of the information or opinions contained in this presentation, and no liability is accepted for any such information or opinions.
FORWARD-LOOKING INFORMATION
This presentation contains forward-looking statements which reflect the REIT’s current expectations and projections about future results. Often, but not always, forward-looking statements can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does notanticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occuror be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance orachievements of the REIT to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in thispresentation. Such forward-looking statements are based on a number of assumptions that may prove to be incorrect, including, but not limited to: the ability of the REITto obtain necessary financing or to be able to implement its business strategies; satisfy the requirements of the TSX Venture Exchange with respect to the plan ofarrangement; obtain unitholder approval with respect to the plan of arrangement; the level of activity in the retail, office and industrial commercial real estate markets inCanada, the real estate industry generally (including property ownership and tenant risks, liquidity of real estate investments, competition, government regulation,environmental matters, and fixed costs, recent market volatility and increased expenses) and the economy generally. While the REIT anticipates that subsequent eventsand developments may cause its views to change, the REIT specifically disclaims any obligation to update these forward-looking statements. These forward-lookingstatements should not be relied upon as representing the REIT’s views as of any date subsequent to the date of this presentation. Although the REIT has attempted toidentify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be otherfactors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to beaccurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance onforward-looking statements. The factors identified above are not intended to represent a complete list of the factors that could affect the REIT.
This presentation includes industry data and forecasts obtained from independent industry publications, market research and analyst reports, surveys and other publiclyavailable sources and in certain cases, information is based on the REIT’s own analysis and information or its analysis of third-party information. Although the REITbelieves these sources to be generally reliable, market and industry data is subject to interpretation and cannot be verified with complete certainty due to limits on theavailability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey.Accordingly, the accuracy and completeness of this data is not guaranteed. The REIT has not independently verified any of the data from third party sources referred toin this presentation nor ascertained the underlying assumptions relied upon by such sources.
All figures in C$ unless otherwise noted.
NOTICE TO THE READER
3INVESTOR PRESENTATION | JUNE 2017NEXUS
NEXUS REIT
Picture of Nexus REIT as Section Divider
Evolution of Nexus REIT
2017 ANNUAL GENERAL MEETING
4INVESTOR PRESENTATION | JUNE 2017NEXUS
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Ne
xu
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ark
et
Ca
p (
$M
)Key Milestones
1.2.
3.
4. 5. 6.
7.
9.
8.
Key Events
Total return since
inception: 37.7%
Jan. 14, 2014: Completes the acquisition of 10 properties for $68.0M partly funded through a VTB to TriWest for $34.0M and the
conversion to a REIT
Feb. 4, 2014: Announces first monthly cash distribution in the amount of $0.00742 per unit
July 16, 2014: Completes the acquisition of three properties $36.7M partly funded by a $20.0M public offering
July - Aug. 2015: Completes the acquisition of three properties for $38.0M partly funded through a VTB of $14.3M
Dec. 17, 2015 Completes the acquisition of two properties for $12.1M partly funded through a VTB of $5.3M
Aug. 22, 2016: Completes the acquisition of a property for approximately $8.4M partly funded through a VTB of $1.9M
Apr. 3, 2017: Completes the merger of Edgefront and Nobel to create Nexus, a $300M diversified REIT
June 6, 2017: Announces a $147M strategic acquisition (the Sandalwood Portfolio), financed through a $55M bought deal
equity offering and a $15 concurrent private placement by RFA Capital
June 20, 2017 Pro-forma market cap after the Sandalwood Portfolio acquisition
1
2
3
4
5
6
7
8
9
5INVESTOR PRESENTATION | JUNE 2017NEXUS
1) Peer average is the simple average of Pro REIT, BTB REIT, True North Commercial REIT, Summit Industrial Income REIT, and Melcor REIT (where data is available)
2) AFFO payout ratio adjusted for unit based asset management and trustee fees
Weighted Average Lease Term (years)
OccupancyDecreasing AFFO Payout Ratio
Debt to Assets
(1)
(1) (1)
(1)
Consistent Financial & Operating Performance
59% 60%
58%
49%
51%
49%
2014 2015 2016
Peer Average
Edgefront
95%
92%
94% 95%
92%
83%
2014 2015 2016
Peer Average
Edgefront(2)
5.9 5.4
5.2
11.9
9.8
8.3
2014 2015 2016
Peer Average
Edgefront
95% 95%
95%
100% 100% 100%
2014 2015 2016
Peer Average
Edgefront
6INVESTOR PRESENTATION | JUNE 2017NEXUS
Nexus – Canada’s Next “Blue Chip” REIT
2017 ANNUAL GENERAL MEETING
7INVESTOR PRESENTATION | JUNE 2017NEXUS
• Diversified sector exposure and introduction into new geographical markets
• Immediate synergies driven by internalization of experienced management team
• Combined portfolio possesses the ability to deliver solid AFFO/unit growth
• Robust pipeline of high quality acquisition assets sourced through strategic partners
Canada’s Next Blue Chip REIT
• Single tenant, industrial focused REIT with 20 properties located
throughout Canada
• Portfolio consisted of 100% occupied industrial real estate assets
that were care free with contractual rent increases
• Supported by TriWest Capital Partners, one of Canada’s leading
private equity firms with ~$1.3 billion in AUM
• Growth oriented REIT with 16 commercial properties, 15 of which
were located in the Greater Montreal Area and one in Ottawa-
Gatineau
• Primary market focus was unique among junior REITs
• Strategic relationship with RFA Capital Partners, a real estate
private equity firm which has invested in over $15 billion of
commercial mortgages and real estate since 1996
✓✓
✓
✓
✓
Nobel Real Estate Investment Trust (“Nobel”)Edgefront Real Estate Investment Trust (“Edgefront”)
$125M in Market Cap
36 Properties Across Canada
8INVESTOR PRESENTATION | JUNE 2017NEXUS
1
2
3
8
4
2
2
7 1
6
Edgefront Properties
Industrial
Office
Retail
Mixed-Use
Nobel Properties
Nexus consists of a diversified portfolio of 36 properties located across Canada, combining Nobel’s asset diversity
with Edgefront’s geographic diversity
16
20
Nationwide Asset Base
9INVESTOR PRESENTATION | JUNE 2017NEXUS
1.2
0.8 2.0
Edgefront Nexus
$7.9
$3.0
$1.1 $12.0
Edgefront Nexus
$13.4
$7.0 $1.1 $21.5
Edgefront Nexus
Tenant LocationRemaining Lease
Term (years)
% of
Total Revenues
AB, NWT, BC, SK 8.4 26%
Lethbridge, AB 12.1 9%
Calgary, AB 7.5 8%
Grand Prairie, AB 8.9 6%
Dorval, QC 12.5 5%
1) After stabilization of 2045 Stanley
2) Shown at ownership interests
(2)
(1)(1)
Nobel portfolioStabilization of
2045 Stanley
Nobel portfolio
& G&A
synergies
Stabilization of
2045 Stanley
Nobel portfolio
& G&A
synergies
Stabilized NOI ($M)
NOI by Sector(1)Key Tenants
Stabilized AFFO ($M) GLA (M Sq. Ft.) NOI by Province/Territory(1)
Robust, Diversified Portfolio with Broad Tenant Base
40.0%
37.7%
6.4%
6.2%
5.9%3.4% 0.4%
AB QC BC SK ON NWT PEI
76.7%
16.3%
4.9% 2.1%
Industrial Office Mixed-Use Retail
10INVESTOR PRESENTATION | JUNE 2017NEXUS
1) Bsaed on issue price
2) EBITDA after stabilization of 2045 Stanley
3) Based on consensus analyst estimates
Nexus – Financial Metrics
Unit Price(1) (C$) $2.10
Basic Units Outstanding (M) 59.7
Market Capitalization(1) (C$M) $125.4
Cash (C$M) $2.3
Debt (C$M) $165.0
Enterprise Value (C$M) $288.0
Debt to EBITDA(2) multiple 9.4x
Debt to Gross Book Value (%) 57.0%
Interest Coverage(2) multiple 3.1x
Annual Distribution per Unit ($) $0.16
Yield (%) 7.6%
Analyst Consensus Information(3)
Consensus Target Price ($) $2.38
Consensus NAV per Unit ($) $2.28
Consensus 2017E AFFO Payout Ratio (%) 78.0%
11INVESTOR PRESENTATION | JUNE 2017NEXUS
Overview:• Privately held real estate investment and
asset management firm • One of Canada’s leading private equity firms
Founded: • 1996 • 1998
Strategic Partner: • Nobel • Edgefront
Experience in
Real Estate:
• Invests in office, retail, industrial and
multi-family properties in the major
Canadian markets as well as mortgages
and CMBS
• Over the past 20 years, has invested in
over $15B of commercial mortgages
• Indirectly own a significant amount of real
estate through current ownership of 17
companies
• Primarily focused on the industrial sector
in Western Canada
Headquarters: • Toronto, ON • Calgary, AB
Other:• Canada’s first and largest investor in non-
investment grade CMBS
• 19 years experience investing in 38
companies representing a broad cross-section
of the economy
Sourced
Acquisitions:• 26 acquisitions sourced through RFA • 14 acquisitions sourced through TriWest
Strong partnerships to provide pipeline for accretive growth
Strategic Relationships with Access to Quality Assets
12INVESTOR PRESENTATION | JUNE 2017NEXUS
Name Title
Board of TrusteesManagement Team
Experience
1) Also serves as a trustee
2) Chair of the board of trustees of Nexus
Kelly
Hanczyk(1) Co-CEO
• Former CEO of Edgefront REIT
• Former CEO and Trustee of TransGlobe
Apartment REIT
• Extensive experience in all disciplines of
industrial, commercial and residential
real estate
Jean
Teasdale(1) Co-CEO
• Former CEO of Nobel REIT
• CEO and Founder of Maestri Terra, a
real estate management and
development company
• Served as VP, Real Estate and
Commercial Services at Aeroport de
Montreal
• Extensive experience in real estate
development, management and
financing
Robert
ChiassonCFO
• Former CFO of Edgefront REIT
• Former Corporate Controller of InStorage
REIT
• Former Director of Accounting and
Finance of Samuel Manu-Tech
• Obtained the CPA, CA designation while
articling with KPMG
Lorne
Jacobson(2) Edgefront
• Co-founder and Vice Chairman of TriWest
Capital Partners
• Former partner of Bennett Jones LLP
Mario
ForgioneEdgefront
• Principal and Managing Partner of
Windermere Realty Corp.
• President and Co-Founder of Edgemere
Capital
• Former Managing Partner and Governor to
the OHL, of the Mississauga Ice Dogs
Brad Cutsey Edgefront
• President of InterRent REIT
• Former Managing Director, Real Estate
Investment Banking at Dundee Capital
Markets
Ben Rodney Nobel
• Principal and Managing Partner of RFA
Capital
• Has structured and closed over $15B of
Canadian real estate and mortgage
transactions
Nick
Lagopoulosn/a
• Principal and Managing Partner of RFA
Capital
• Previously with GE Capital and Credit
Suisse
NameFormer
BoardExperience
Leadership Team
13INVESTOR PRESENTATION | JUNE 2017NEXUS
Internalized Asset Management Structure
InterRent
Allied PropertiesMainstreet
First Capital Realty
Pure Industrial
CREITRioCan
Pure Multi-Fam
Killam Apt
Choice Properties
SmartREIT
CTGranite
H&RDream Office
CrombiePlaza Retail
Northview Apt Artis
CominarOneREIT
CAPREIT
Boardwalk REIT
8.0x
11.0x
14.0x
17.0x
20.0x
23.0x
26.0x
$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 $9,000
2017E
P /
AF
FO
Market Cap (C$M)
Automotive
Slate Retail
Slate OfficeSummit
Melcor
PROMorguard
Agellan
Dream Global
Inovalis
Dream Industrial
BTB
WPT
Morguard NAR
8.0x
9.0x
10.0x
11.0x
12.0x
13.0x
14.0x
15.0x
16.0x
$0 $200 $400 $600 $800 $1,000 $1,200 $1,400
201
7E
P/
AF
FO
Market Cap (C$M)
Internally Managed REITs
Externally Managed REITs
NAR
Nexus is partly benefiting from a valuation bump related to its recent internalization; REITs with internalized asset manager
functions typically trade ~5x higher (on a P/AFFO basis), even when considering size
<$1B Market CapAverage: 16.8x
<$1B Market CapAverage: 12.0x
14INVESTOR PRESENTATION | JUNE 2017NEXUS
10500 Avenue Ryan – Dorval, QC 10340 Cote de Liesse – Montreal, QC
955 Boulevard Michele-Bohec – Blainville, QC 1600 Rue Montgolfier – Laval, QC
❖ Located in Dorval in close proximity to the Trans Canada Highway; fully
occupied by Dicom Transportation Group Canada Inc. on a lease expiring
in December 2029
❖ Newly renovated office property located in the borough of Lachine in
Montreal, near the Pierre-Elliott-Trudeau international airport and Highways
20 & 40; tenants include Gestidev and HollisWealth Management
❖ Newly built office building located near Highway 15 in Blainville’s business
park; the main tenants are Above Security (part of the Hitachi Group),
Public Works and Government Services Canada, and Sun Life Financial
with leases expiring between May 2024 and May 2028
❖ Strategically located at the corner of Highway 13 and Boulevard Saint-Martin,
the fully occupied building includes the headquarters of Crescendo Systems
Corporation, occupying 21,031 sq. ft. under a lease expiring in 2025, and
Shimadzu Canada under a lease expiring in 2021
GLA (sq ft) 52,372
Type Office
Occupancy 100.0%
GLA (sq ft) 26,281
Type Office
Occupancy 95.0%
GLA (sq ft) 33,461
Type Office
Occupancy 100.0%
GLA (sq ft) 27,097
Type Office
Occupancy 100.0%
Select Nexus Properties
15INVESTOR PRESENTATION | JUNE 2017NEXUS
3501 Griffen Rd. North – Lethbridge, AB 4700 & 4750 102 Avenue – Calgary, AB
455 Welham Road – Barrie, ON 12104 & 12110, 17th Street – Edmonton, AB
❖ Acquired on July 15, 2014 and leased under a long-term lease to Triple M
housing that expires on July 14, 2029. Located in close proximity to
Highway 3.
❖ Located in close proximity to Highway 2 and acquired on August 25, 2015,
this property is leased under a long-term lease to Canada Cartage that
expires on December 31, 2024
❖ Located in close proximity to Highway 400 and acquired on July 17, 2015,
this property is leased under a long-term lease to Prodomax Automation
that expires on June 16, 2025
❖ Acquired on January 14, 2014 and leased under a long-term lease to
Westcan Bulk Transport that expires on November 14, 2025. Located in
close proximity to Highway 100.
GLA (sq ft): 229,000
Land (acres) 31.4
Occupancy: 100%
Built/Ren: 2008 / 2012
GLA (sq ft): 29,471
Land (acres) 13.5
Occupancy: 100%
Built/Ren: 2009
GLA (sq ft): 109,366
Land (acres) 7.3
Occupancy: 100%
Built/Ren: 1998 / 2015
GLA (sq ft): 116,582
Land (acres) 34.0
Occupancy: 100%
Built/Ren: 1973 / 2011
Select Nexus Properties
16INVESTOR PRESENTATION | JUNE 2017NEXUS
Overview of the Sandalwood Portfolio Acquisition
2017 ANNUAL GENERAL MEETING
17INVESTOR PRESENTATION | JUNE 2017NEXUS
Asset Overview:
• 8 office properties (7 Class I office properties)
• 1 industrial property
• 17 retail properties
Acquisition Cap Rate: • 7.3% (Purchase price of ~$147M, $97 per sq. ft.)
NTM NOI: • $10.8 million
Debt / GBV: • 56.5%
GLA:• 1.5 million sq. ft. (at 100% interest in 2 properties
and 50% interest in 24 properties)
Financing:
• Assumption of $75.8M in debt and new mortgage
financing of $8.5M
• ~$55M bought deal public equity offering
• Concurrent $15M private placement with RFA Capital
• Vendor to receive a portion of purchase price in
Nexus units via VTB of $2.0M
Target AFFO Accretion: • 4.0% - 5.0% (at issue price of $2.10)
Background to Transaction
Sandalwood Transaction
Map of Quebec Properties
Asset / Transaction Highlights
Greater
Montreal Area
Greater
Quebec City
Area
• On June 5, 2017, Nexus announced and waived diligence and
certain other conditions in its agreements to acquire a portfolio
of assets located in GMA and GQCA from vending entities
associated with and/or related to Sandalwood Management Inc.
("Sandalwood"), a private real estate firm dually headquartered
in Austin, Texas and Montreal, Quebec
18INVESTOR PRESENTATION | JUNE 2017NEXUS
Sandalwood Portfolio Acquisition – Highlights
Immediate accretion of 4-5% to adjusted funds from operations per unit
1
2
3
4
5
Attractive valuation metrics
• Proportionate interest in Sandalwood is being acquired at an attractive 7.3% cap rate
• Off-market transaction sourced through Nexus’ strong relationship with RFA Capital
RFA Capital will invest an additional $15M in Nexus through a concurrent private
placement
Strong tenant roster with many investment grade credit-rated tenants
• Canadian Tire, Metro, Dollarama, Provigo, Staples, IBM, Xerox, BMO and National Bank
Significantly enhances Nexus’ position as a leading diversified REIT
• 78% increase in owned GLA
• ~50% increase in gross book value (~$450M)
• Increased presence in the stable GMA and GQCA markets
6Partnership with Sandalwood provides access to a proprietary pipeline of potential
future acquisitions (above and beyond the ROFO)
19INVESTOR PRESENTATION | JUNE 2017NEXUS
Overview of Select Properties
Select Old Montreal Properties
Select Greater Quebec City Area Properties
20INVESTOR PRESENTATION | JUNE 2017NEXUS
Portfolio and Tenant Information
Key TenantsPortfolio Overview
Pro Forma NOI
1) At Nexus ownership interests; Portfolio approximates ~2.5M sq. ft. at 100% interest
Tenant GLA % Credit Rating
9.5% BBB+
9.2% BBB
3.9% BBB
2.6% BB+
2.2% BBB
1.8% A+
0.7% AA-
0.5% A
0.2% A+
Total 30.5%
Property Name Location(2) Owned
%
GLA
(Sq. Ft.)(1)
Asset Class
LE Centre de Victoriaville GQCA 100% 375,788 Retail
400 Place St. John St John 100% 159,927 Office
Les Halles d'Anjou GMA 50% 52,699 Retail
Place L'Ormiere GQCA 50% 57,198 Retail
Place Liray GQCA 50% 22,310 Retail
LE Centre Nicolet GMA 50% 44,192 Retail
Place Sorel GMA 50% 58,174 Retail
LE Centre Sherbrooke GMA 50% 85,477 Retail
Place Orleans GQCA 50% 16,206 Retail
Galeries Orford GMA 50% 66,860 Retail
Galeries de L'Erable GQCA 50% 49,806 Retail
Place Mont-Marie GQCA 50% 21,638 Retail
LE Centre Ste-Anne GQCA 50% 44,313 Retail
Place Cote Joyeuse GQCA 50% 32,231 Retail
LE Centre la Pocatiere GQCA 50% 104,400 Retail
LE Centre Forestville Forestville 50% 27,981 Retail
Les Galeries Taschereau GMA 50% 106,991 Retail
LE Centre Brossard GMA 50% 21,675 Retail
329 de la Commune GMA 50% 10,563 Class I
353 St. Nicolas GMA 50% 17,816 Class I
410 St. Nicolas GMA 50% 77,466 Class I
360 Notre Dame GMA 50% 14,950 Class I
63 des Bresoles GMA 50% 19,839 Class I
321 de la Commune GMA 50% 5,751 Class I
127, 137 & 145 St. Pierre GMA 50% 16,839 Class I
425 Rue Guy GMA 50% 20,484 Industrial
1,531,571
51.3%
25.7%
19.7%
3.3%
Industrial Retail Office Mixed-Use
41.0%
34.9%
12.6%
3.9%
3.6%2.3% 1.7%
GMA
Western Canada
GQCA
ON
Maritime
NWT
GOA
21INVESTOR PRESENTATION | JUNE 2017NEXUS
Edgefront Nexus Nexus Pro Forma
Market Capitalization ($M) $87.1 $125.4 $197.4
Enterprise Value ($M) $171.0 $288.0 $449.8
Assets ($M) $176.0 $289.5 $446.9
Debt / Assets 48.1% 57.0% 57.0%
GLA (Sq. Ft. in Ms) - At Interest % 1.2 2.0 3.5
Number of Properties (1) 20 36 62
Nexus Market Metrics – Post Sandalwood Portfolio Acquisition
1) Includes 50%-owned properties
22INVESTOR PRESENTATION | JUNE 2017NEXUS
Focus for 2017
Lease up and
Repositioning of
2045 Stanley
Internal Growth
Opportunities
Integration of the
Edgefront and Nobel
Platforms and
Sandalwood
Portfolio
Identification and
Execution of Off
Market Pipeline
Acquisitions
1 2
34
23INVESTOR PRESENTATION | JUNE 2017NEXUS
Kelly HanczykCo-CEO
Phone: (416) 906-2379
Email: [email protected]
Jean TeasdaleCo-CEO
Phone: (514) 840-9339
Email: [email protected]
Contact Information
Rob ChiassonCFO
Phone: (403) 817-9496
Email: [email protected]