Hey, thank you so much. Appreciate it, yeah. Ready? Yeah, let's do it. Hello, everybody. This is Moishe presenting Strawberry Fields. Hello. For all those who were not at the OptimumBank presentation only 3 minutes ago, I'm Moishe Gubin. I'm CEO, chairman, and founder of Strawberry Fields REIT. We are on the New York Stock Exchange under the ticker STRW. We're a healthcare REIT with about $1.6 billion of real estate, about $175 million in rent, and about $75 million of free cash flow. I know, I know, we're not a micro-cap company, but we pretend we are so we can come to these events. These are our highlights. Our company started about 22 years ago, almost 23. October 31st will be 23 years, where my partner and I started buying real estate. We started with buying our first nursing home.
We're originally nursing home operators, both from New York. I'm a Queens boy, my partner is a Brooklyn boy. We did not know each other as kids, even though we had the same friends in high school. My friends were at his wedding, his friends were at my wedding, and we never met each other. We ended up working for a really bad company about 25 years ago, and we realized we wanted to get out of that company as bad as we could. It was the first time in my career that I actually worked for a corporate company. Before that, I was always working mom and pop. I knew who the boss was. I knew who I worked for. I felt good working hard, making a living for my boss and making a living for myself.
We bought our first building, and that was October 31st, 2003. We built up the business since then, and we spun off to create Strawberry Fields in 2015, which was basically the real estate of, at the time, I think it was about 33 buildings that we spun into this company. Since then, we grew. We grew to today, we're about 143, something like that, 143 buildings. 143 licenses, 133 buildings, something like that. I truly, at this point, it's like when you're living the dream and God really took care of I'm lucky, obviously. You get to a certain point where we have a nice running organization and a war machine. We buy stuff, we lease it out, we collected the rents, 100% of our rent collection over the last eight years.
We're returning altogether about a 17%-18% return, 5.5% dividend yield, plus AFFO per share growth annually of 12%-11%. We'll get to it in the slides. We're a really, really strong company. We're in 10 states currently. We have a deal that we announced recently to bring us to the 11th state. Dividend yield, like I said, is about 5.5%. We're expecting an AFFO per share for 2026 be $1.36. Everybody here familiar with the term AFFO? Okay, a lot of folks don't use that term. It's basically free cash. What you would call It's not NOI, but it's basically after paying everything, including principal paydown. This is the free cash that we're left with, and it takes away the straight-line rent.
In GAAP accounting, you're forced to do, if you do a 10-year lease with somebody and it has annual escalators, you take it, you add up all the lease payments, you divide it by 10, then you do a bell curve amortization chart. At the beginning, you're booking a higher rent number but receiving less, at the end, you're booking a lower rent number and receiving more. That's called straight-line rent that GAAP initiated, I don't know, maybe 10 years ago at this point. Again, our AFFO, which is really the net, net cash. We're going to talk about it a little bit later. You talk about once you pay everything out, that's the amount you have available to distribute. If you wanted to distribute it, you want it to be 100% payout ratio.
In our case, it would be $75 million of what we'd be distributing. In our case, since we're only doing a payout ratio of 46%, we're distributing less money, then we're using the rest of the money to go buy more assets. That's why we have that share growth, which other guys don't have. You look at our peers. Our peers basically distribute 100% of their free cash. When they have to buy something, they dilute their shareholders by running an ATM, or they use a line of credit, then they pay down their line of credit by doing an ATM. We run a little bit different than those guys. We're also smaller. We're probably one of the smallest REITs on the New York Stock Exchange that's traded. We're holding our own against our peers, thank God.
Our EBITDA for first quarter was $32 million. We expect that to be per share about $2.25. Our business, the way we manage the company is by managing the balance sheet and by managing the asset. I've been saying that line for 20 years now. We manage the asset by having our asset managers visiting the properties twice a year, talking to the tenants all the time. Our tenant is one whole building. We have a total together of 15,000 residents or nursing home patients in nursing homes, but we're one tenant per building. We have 143 tenants, but really that equates to each one of those tenants have 100 or 200 or 300 of their own tenants. We manage the balance sheet, like I was saying, is based on the debt side.
We're managing between fixed and variable rate loans, we'll get to that in a slide going forward. We're an income-producing real estate company, which is what a REIT is. We primarily lease our properties on all triple net properties, 10-year leases with two five-year renewals, 3% annual escalators, guarantees of the leases. It's pretty bulletproof. Right now, our portfolio, which we're going to get to, is over a 2 times rent coverage in our portfolio. The one quirk in our company, which might be a block to some shareholders to invest, is that 45% of our portfolio is leased to related parties to me. That number was 100% 12 years ago, we're diluting ourselves as fast as we can by growing the portfolio, not with me being a related party to the tenant.
That's gone from 100 down to 45, it's a process because when you're making money, you don't want to just get out of a business, right? It's got to be buy more to dilute. Same thing with the shareholders. My partner and I own 75% of the stock. We own it as OP Units, and because of REIT rules, since we're OP tenant and landlord, we can't own more than 10% together of our voting stock. We have a class where it's just non-voting common at the end of the day. We want to keep this as a legacy asset. We want our grandchildren collecting rent checks here. The only way to dilute us is by growing and bringing in other investors, and by growing the company and buying more assets.
Our properties are, like it says here, Arkansas, Illinois, Indiana, Kansas, Kentucky, Missouri, depending on who you are, Ohio, Oklahoma, Tennessee, and Texas. We are the pure play SNF, skilled nursing facilities. 92% of our portfolio are skilled nursing facilities. We have a couple of LTACs, and the rest of them are in assisted livings. We finance a lot of our debt. It's really divided almost a third, a third, a third between HUD debt, Israeli bond debt. We were number 14 to go public in Israel in 2015, and we floated our first bond in 2015. Since then, I think we've done eight series and probably 15 issuances. Most recently, we had what they say a successful issuance in a bad marketplace with a war going on with Iran and everything else.
We were still able to raise, I don't even remember, it was $80 million, which you take the shekel, it's ILS 250 million shekel in a marketplace. I guess we're proud of that. This is just a summary. Like I said, 132 owned assets, and one long-term lease. We have a floor of a hospital in Indiana. Otherwise, we have a bunch of properties. There's 10 properties of that group that have a split between a nursing home and an assisted living or a nursing home and a hospital. 15,600 total beds. We have a pipeline. That pipeline is, God willing, we will close with a bogey that we're shooting for every year is between $100 and $150 million of purchases. Everything we buy is at a 10 cap, should be stated. Annualized adjusted AFFO, about $75 million. EBITDA $128. Net debt 49%, so we're not highly levered.
That really number is lower. We're not taking actual appraised value versus that number's probably a lower number. We have less than six times net debt to EBITDA. Like I said, our rent coverage is over two times. Again, our whole goal, we buy something, we earn 10% unlevered return on the asset we're buying. Our tenants start at a one and a quarter rent coverage. They work their way to two times rent coverage, so I know that I'm certain that I'm going to get my rent. I take that rent, I pay my debt, I have the excess money, I dividend out to my shareholders, and then whatever I have left over is we buy more assets. That's like REIT made easy for folks that don't know REIT, this kind of stuff.
This is our growth, this is only the last 10 years. Again, started 33 facilities, up to 143. You could see, we didn't go crazy. A lot of these other guys become a CEO, someone gives them money, then they just go hog wild and buy stuff. We've been the slow and steady tortoise and hare kind of story. Me being the founder of the company, I'm just not crazy about just throwing money around. This is a legacy asset that we want to take care of, and we want it to exist for a long time. We're a little bit more conservative than our peers. We're very, very disciplined, and you see that in how we grew and how we grow. This is what our map looks like. When we first started, we used to visit every property, me and my partner.
I was living in South Bend, Indiana. My partner was living in Chicago, Illinois. We're both from New York, like I said, but this is where we were living. We started by buying a building that was 81 miles from my house and an hour and a half drive from him because of traffic from Chicago. We continued to grow those portfolios the way we did. Like our legacy assets are the ones that are in northern Illinois and Indiana, and that's currently what our related party portfolio is Indiana, Illinois, or northern Illinois, and Tennessee. We've grew, we're a big fan of Are you guys familiar with the master lease structure? You guys know what that is?
Instead of me leasing one property to one guy, I lease him five properties under one lease, so that if something happens in one of those properties, he can't walk away. It's an all or none deal. If his portfolio is performing, right, and he has one that's struggling, I'm still guaranteed to get 10 years of rent. Which is at a 10 cap, right? I make my money back and then some on a worst case scenario, and that's been our portfolio. We will only go into a new state when there's a big enough portfolio that I could do a master lease. Or it's contiguous, like Nebraska in theory. If somebody from northern Missouri wanted to go into Nebraska, in theory, I could go into Nebraska and put that into one portfolio. This is our management team. Jeff Bajtner is sitting over there.
He's fourth row back. Greg is our CFO, who's not here. Steven Greenfield drives me crazy. He's a lawyer. If you've been in on the last one and this one, you could tell that I really love my lawyers, but they drive me crazy. Like, it's the worst. Our board of directors, we have a strong board. Mark Myers has been a broker for nursing homes stuff, for healthcare stuff for, it says 30 years, but the guy's older than dirt, so it's got to be more like 50, 60 years. Jack Levine, also a good accountant from Miami Beach. It's like if you're a sports fan, you use the analogy of you play the hot team, like we're running a hot team. We're like everything's running perfectly. We get our rents, we collect our receivables like the first of the month.
The books are clean. We have two audit firms, Deloitte and another audit firm, because we do our stuff in IFRS and in GAAP. Our stuff is immaculate. Governance is in order, SOX is in order. Everything that you would think of at a microcap event, that I should be a mess, I'm the opposite. Where governance-wise, everything is literally spot on, and I'm proud of that. Anyway, next item is our disciplined underwriting. Again, we already talked about some of this is we start with a 10% unlevered cash on cash return. We lever up usually about 50%, like we saw on the other slides, at 49%. That gets our return a little higher. All the leases are 10-year to 5-year renewals, 3% annual increases.
Really similar to the bank conversation we had now 20 minutes ago, what makes our company different is, my background is as a nursing home operator. When I'm meeting a new tenant, we don't just randomly say, "Okay, you're fine, let's go put you in there," or, "You have money, therefore we'll just lease to you." I sit there and I give them a whole, I grill them. I'm like, "Where did you learn? Who taught you? What did you do? How does your structure work? What's your corporate governance look like?" If you're a regular real estate guy, a guy who shows up with cash, and he's willing to give you his guarantee and he's willing to give you money, you'll lease it to the guy. Our business, not so much. We have people's lives at stake.
It's a business that people think you have bad guys in the business. I want to always try to push that we do business with good guys, and we're taking care of people, and the whole nine yards. That's been a secret sauce to us, because we haven't had really tenants Even tenants that went bad, they gave us notice, and we found the replacement tenant, and we never lost them a dollar of rent. Things worked out pretty good, and they continue to work out pretty good. These are our tenants. Some of them, the bigger ones, Reliant is in Missouri, Hill Valley is in Kentucky, Oasis is in Arkansas. This is just the industry. The barriers of entry, you can't just build a new nursing home next door to some other nursing home.
The license itself, it's a new license, it's not transferable building to building. I don't have a risk of a guy being my tenant and then him building a new building down the block and then taking the license and running away from me. He can't do that. That license stays with my building, and that prevents people from doing anything. Besides that, the cost of construction today for healthcare is ridiculous. There's no new nursing homes in America today. Whenever you hear politicians talking about nursing homes, reality is they can't close any nursing homes down because they're expecting the silver tsunami, for people to, the baby boomers that are aging into it. You can't have less nursing home beds because, at this point, you need them to because they're going to get filled up and there's nothing new being built.
The barriers of entry, growing demand, low supply of nursing homes, high barriers of entry, very regulated. I think the three most highly regulated people always said was banking, nursing homes, and atomic nuclear energy. Everyone may ask me, "Moishe, when are you getting into nuclear energy? That's the only one missing from your portfolio." This is just the aging demographic. You could see the amount of money they're spending in Medicare. It goes up and up. This is our company. Isn't that beautiful? You look at the growth rate on the AFFO, nice trajectory. You look at the EBITDA growth, nice trajectory. Asset growth. This is net assets for GAAP. This doesn't value what the current market value.
We have about another $500 million of market value of our assets that we're listing here based on historic cost or net cost, and that's the base rent growth. Any questions before I go on? Yes, sir. I'll tell you like this. Yesterday I'm sitting in my office and I see my phone ring. A guy, Chris Brogden, and I'm like, "Hey, buddy, what's going on?" He goes, "I want you to buy that building from me." I said, "What building?" He tells me a building in Indiana. Now, I'm his first and only call. I go, "Chris, what do you want me to pay you for it?" He says to me, he says, "Listen, I don't know. Whatever market is, I'm going to sell to you at a discount.
I already know you're going to close the deal or whatever it is." I went to Jeff and basically told him to work on it, and we'll see where it goes. That's how it happens every day of the week. It's not every single one that's that eager and says, "Here's the keys, just write me a check." I don't know if you could tell from my personality, I'm an easygoing, friendly guy, and I go run around and I bullshit with anybody, for the most part. Okay. If I've been doing that, and I've helped out a bunch of guys in the business for years and years. I've mentored people in all kinds of business and all kinds of stuff, and I don't mind doing it. I actually enjoy it in some weird way. It's mildly entertaining as well.
Years later, these people that are in these industries, nursing homes, for example, they look to me almost like a rabbi. "Rabbi, help me. I want to do this, I want to do this, I want to do this, I want to do this. What's the advice?" I give unbiased, as best as I could be. I am a human, so I might have a motive for myself. Most of the time, it's supposed to be unbiased advice. When you have that relationship with that industry, and I'm not saying I know everybody, I'm not saying I'm liked by everybody, but the reality is I have that relationship with that industry. They have NIC conferences, they're called, NIC, twice a year.
When I walk into a room, and they'll tell you, I end up having an audience around me because they're all people that I've helped, and they want to say hello, and they want to see what's going on, and they want to do business with us. That's been a major help for us to get source deals. I'm not just a blank check Welltower guy, like a corporate suit somewhere. I'm the guy that they know and they could talk to. That's how we source deals and that's how it's continuously been. When we buy something from somebody, they've usually come back to sell us something else over and over and over and over, and that's been very good for our portfolio. Anybody else? Yes, sir. Do one at a time. I'm not going to remember. We have 143. Oh, you're talking about the stock.
We have, what do we have? $43 million of, 43 million shares of OP Units, and they convert one for one. Yeah, exactly. Exactly the same. Our dividend date was yesterday, and I'm an OP Unit. I'll get exactly on the same day, June 30th, I'll get the same $0.17 per share that the regular shareholder gets. There's nothing special. If anything, it has less rights because it doesn't get to vote. Good? Anybody else? All right. This is just our stock price. Today we're trading at $13.30, $13.40, overall it looks okay for the last few years. It's not as strong as I want it to be.
The one thing I'm really proud of is the amount of shareholders we have, we've been doing this literally We try with some of those guys that charge you a lot of money for IR, every single one that we've talked to didn't end up doing anything. We end up on our own with grassroots, talking to people, pick up shareholders. I always tell people, just, I'm telling you, my cellphone number is on my business card, okay? Send me a screenshot when you buy the stock. You're in Schwab, you're in somewhere else, send me a screenshot, make me feel good. Even if it's five shares, just let me see it. I feel good about it. That's the amount of shareholders have gone up. Our growth rate, base rent, we talked about this. There. This is one of my favorite slides.
This is basically the math that I talked about. We have $75 million of free cash after we pay everything, okay? From there, we dividend out 47%, which is the $0.17 a share, or this is going to be based off of $0.16 or $0.15. It might be a little bit off. Anyway, the leftover cash is about $40 million. From that $40 million, if I take a 50% leverage, I could go buy $80 million of assets. That $80 million of assets will return a 10%, or a little bit better than 10% it'll be because half of that is debt. It'll bring me, let's say, 13%. I pay off the debt on the half of it. I'm netting out for every shareholder another seven, 8%. That all make sense to everybody in the room? You end up taking this $40 million.
Instead of giving it away to the shareholders, I take that $40 million into an asset that's going to make money for all the shareholders to the clip of another $3 million to share amongst the friends, right? This is exactly what we're doing. If you look at the share growth, it's 10.7%. What I said before, you take this plus the five-point whatever, it comes out to about 16% annual return. We expect that to be better than that, and this year we're on target to beat all of our numbers. That's every year, we beat our numbers year in, year out. This is an interesting slide. I think I'm running out of time, so I don't know if I have enough time to talk about this. Basically, this is our maturity schedule for our debt.
To someone who really is that interested, we're I guess an anomaly, where our debt structure was done, and I did it, and I could take the blame for it. I didn't do it exactly the right way, the way all my peers do it. It should be, and we're fixing it right now, so this is the year that it gets fixed, where we have normal, every year, over four years, 25% of the debt matures so that every year we can work on next year's maturities to roll it into five years from now so that we never have, like, where we have a big debt maturing at any given time. That's what this schedule is. Feel free to read it. Feel free to chase me down, I'm glad to walk you through it.
This is just talking about in the nursing homes what the payer types are, this is not a surprise. Most of the money in the nursing homes are funded by the government, both federal and state. The state gets funded by the feds, it's really all federal funds for the most part. This is fun. This for me is fun. Maybe not for you. If you take a look at our portfolio, this used to be literally one tenant, so it was like the whole color. I'm colorblind, so whatever color that is, it would be one whole color of that, or split between Illinois and Indiana was two. This now has it where we don't have any. We have one big tenant at 25%. Everything else is high single digits or double digits.
This just shows you that at the end of the day, if you're worried about a risk of something happening, we're diversified in concentration, based on state and by operator. This was not easy to do, by the way. At the end of the day, you can't design a portfolio that easily. Especially when you see a deal and the deal makes sense number-wise, and you go, "Oh, I want to do this." To manage to this is really, I'm super proud of this and I like this slide a lot. This is us versus our peers, based on return. 26% return for the stock. This is I think the last 12 months. Our trading multiple, you could see we're trading way below our peers, which would tell you to be strong buy. We have seven analyst coverage.
I think everybody's at a buy, or maybe one neutral and everyone else is a buy. Average price target is probably $16 a share. Our payout ratio, again, is the lowest from all of our peers. Our dividend yield is right in line with the middle of the group. This is the pure play. This is what I was talking about before. Almost 92% of all of our stuff is SNFs, and where no one else has that. If you believe in that business. All right, I'm really running out of time. Yes, sir. The answer to you is no.
I qualify that by the people that are investors, including myself, if a deal came along and we needed to pump in money, like, ASAP, besides the ATM, besides having an active, what is S3 or whatever it is, to be able to go and issue and do a prospectus and actually trade, and actually raise money. We have a bunch of availability to be able to do that. We don't have a stockpile of cash, but we have wherewithal to be able to take on debt or equity to be able to do that. Take a look at our share growth. AFFO per share growth means per share, how much money it's growing. We're beating everybody fair and square. That's our presentation. Any other questions or are we done? Thank you for your time.