MEMPHIS, Tenn.–(BUSINESS WIRE)–Jernigan Capital, Inc. (NYSE: JCAP), a leading capital partner for
self-storage entrepreneurs nationwide, today announced results for the
quarter ended March 31, 2019.

First Quarter Highlights include:

• Earnings per share and adjusted earnings per share of $0.35 and $0.52,
  respectively, both above the high end of guidance ranges provided with
  the Company’s fourth quarter 2018 earnings release;
• Continued transition to property ownership with on-balance sheet
  purchase of the developer’s interest in the Company’s New Haven
  development property investment and purchase by the Company’s joint
  venture with Heitman of the developers’ interests in the Atlanta 1,
  Jacksonville, Atlanta 2, and Denver development property investments –
  Company now has direct or indirect fee ownership in 63% of the
  facilities for which it has financed development and that have been
  open for business more than 12 months;
• Closed on two development investments, in Stamford, Connecticut and
  Staten Island, New York, with an aggregate commitment amount of $21.7
  million;
• Leasing commenced on the Generation V self-storage facilities
  underlying four development property investments in which the Company
  has an aggregate committed investment of $29.1 million, 49.9% profits
  interests and ROFRs; and
• Increased book value per common share to $19.02 at March 31, 2019 from
  $18.35 at March 31, 2018.

“The Company is off to a great start in 2019,” stated Dean Jernigan,
Executive Chairman of Jernigan Capital, Inc. “As the development cycle
approaches its fifth year, we remain selective in committing to new
development opportunities, focusing exclusively on select submarkets
with strong demographics that have been largely overlooked this
development cycle. Year-to-date we have closed three new development
investments in Staten Island, NY, Stamford, CT, and Long Island, NY,
three submarkets that exhibit the compelling demographics that we expect
will drive strong demand and excellent returns over time.”

John Good, Chief Executive Officer of the Company, added, “Our first
quarter results reflect another quarter of strong execution, with
revenue, earnings per share and adjusted earnings per share exceeding
the high end of our quarterly guidance ranges. We posted 89% growth in
total revenues and 103% growth in adjusted earnings compared to the
first quarter of 2018. Our portfolio of state-of-the-art Generation V
self-storage properties continues to progress through construction and
lease-up, with 46 facilities, representing 65% of self-storage projects
that we have financed, open and operating as of the end of the first
quarter.”

“We continue to see opportunities to acquire developer interests in our
core development investments,” Mr. Good continued. “In January, our
joint venture with Heitman acquired developers’ interests in two
facilities in the Atlanta MSA, one facility in the Jacksonville MSA and
one facility in the Denver MSA, and in March we acquired the developer’s
interest in our New Haven, Connecticut development property. We have now
purchased our developers’ interests in eight facilities on balance sheet
and in four facilities within our joint venture. With those acquisitions
and the three development investment commitments year-to-date, we have
committed almost 50% of the midpoint of our full year 2019 investment
guidance range of $85 million to $115 million.”

“From a capital perspective, we continue to be extremely focused on
maximizing stockholder value by properly matching investments with the
optimal capital sources, including our recently upsized credit facility
and our common stock ATM program,” Mr. Good added. “Our investment
commitments including 2019 closing guidance are fully covered through
mid-2020, and we have positioned ourselves to maintain conservative
leverage levels in the range of 25% to 30% of total assets for the
foreseeable future.”

Financial Highlights

Earnings per share and adjusted earnings per share for the three months
ended March 31, 2019 were $0.35 and $0.52, respectively, which are each
$0.13 above the high end of the Company’s guidance range provided in the
Company’s fourth quarter 2018 earnings release.

Net income attributable to common stockholders for the three months
ended March 31, 2019 was $7.1 million, or $0.35 per share, and adjusted
earnings were $10.6 million, or $0.52 per share, representing increases
of $5.3 million, or 303%, and $5.4 million, or 103%, over the $1.8
million and $5.2 million of earnings and adjusted earnings,
respectively, reported for the first quarter of 2018.

Total revenues for the three months ended March 31, 2019 were $9.9
million, representing an increase of $4.7 million, or 89% over revenues
for the comparable period in 2018. The increase in revenues is primarily
attributed to the increase in the outstanding principal balances on the
Company’s investment portfolio.

General and administrative expenses, excluding fees to the manager, for
the three months ended March 31, 2019 and 2018 were $1.8 million.
Included in these amounts were stock-based compensation expense of $0.3
million for the three months ended March 31, 2019 and 2018.

Net income attributable to common stockholders and adjusted earnings for
the quarter ended March 31, 2019 also includes increases in the fair
value of investments of $8.8 million compared to increases of $4.3
million for the comparable period in 2018. This represents a $4.5
million, or 104%, year-over-year increase from the quarter ended March
31, 2018.

Subsequent Events

In April, the Company closed a new development investment in Long
Island, New York with a $23.5 million commitment.

Capital Markets Activities

As of March 31, 2019, the Company had borrowed $27 million of $118
million of total availability under its secured revolving credit
facility. The Company expects availability under its credit facility to
continue to increase over the remainder of 2019 as the Company adds
existing on-balance sheet operating properties to the borrowing base.

During the first quarter, the Company issued an aggregate $2.9 million
of common stock under the Company’s at-the-market (“ATM”) program at an
average share price of $21.43, a 12.7% premium to the Company’s reported
book value per share as of December 31, 2018. The Company had $72.2
million available on its current common stock ATM Program at March 31,
2019.

Dividends

On February 22, 2019, the Company declared cash and stock dividends on
its Series A Preferred Stock. The cash dividend of $2.2 million was paid
on April 15, 2019 to holders of record on April 1, 2019. A stock
dividend of 2,125 shares of additional Series A Preferred Stock was
issued on April 15, 2019 to holders of record on April 1, 2019 for an
aggregate value of $2.1 million pursuant to the terms of the Stock
Purchase Agreement.

On February 22, 2019, the Company declared a cash dividend on its
Series B Preferred Stock. The cash dividend of $0.7 million was paid on
April 15, 2019 to holders of record on April 1, 2019.

Additionally, on February 22, 2019, the Company declared a dividend of
$0.35 per common share. The dividend was paid on April 15, 2019 to
common stockholders of record on April 1, 2019.

Second Quarter Guidance

The following table reflects earnings per share and adjusted earnings
per share guidance ranges for the three months ending June 30, 2019.
Such guidance is based on management’s current expectations of Company
investment and acquisition activity (including fair value appreciation,
the expected timing of construction progress and receipts of
certificates of occupancy, and the assumptions regarding the timing of
acquisitions of developer interests), the operational and new supply
dynamics of the self-storage markets in which the Company has invested,
and overall economic conditions, including interest rate
levels. Adjusted earnings is a performance measure that is not
specifically defined by accounting principles generally accepted in the
United States (“GAAP”) and is defined as net income attributable to
common stockholders (computed in accordance with GAAP) plus stock
dividends to preferred stockholders, stock-based compensation expense,
and depreciation and amortization on real estate assets. For more
information about our calculation of adjusted earnings, see “Non-GAAP
Financial Measures” below.

The Company is also reaffirming its previously issued guidance for full
year 2019. Net income attributable to common stockholders is expected to
be between $0.82 and $1.46 per share, and adjusted earnings is expected
to be between $1.52 and $2.13 per share.

Additionally, the Company continues to monitor its 2019 fair value
guidance with updated estimates of construction progress, timing of the
receipt of certificates of occupancy from its development partners and
the movement of interest rates and spreads. Of the estimated $30.0
million to $40.0 million of fair value appreciation in 2019, the Company
recognized $8.8 million during the first quarter, and expects $6.0
million to $8.0 million to be recognized in the second quarter, $5.5
million to $9.0 million to be recognized in the third quarter, and $9.7
million to $14.2 million to be recognized in the fourth quarter. The
Company’s 2019 fair value guidance reflects updated estimates of the
timing of construction completion of the self-storage facilities
underlying certain of our development investments, as well as the timing
of stabilization of facilities in which we have invested. Timing of fair
value appreciation is heavily dependent upon construction progress and
the timing of construction completion, both of which are subject to
factors outside the control of the Company and the Company’s development
partners. Moreover, when the Company acquires the developer’s interest
in a self-storage project that the Company has financed, the Company no
longer accounts for such investment under the fair value method, so
acquisitions of developer interests have a potentially material effect
on future fair value recognized in the Company’s financial statements.
As such, the amount and exact timing of fair value recognition is
subject to change.

Refer to the Company’s First Quarter 2019 Supplemental Information
Package for more information.

Conference Call and Webcast Information

The Company will host a webcast and conference call on Thursday, May 2,
2019 at 8:00 a.m. Eastern Time to discuss the financial results and
recent events. A webcast will be available on the Company’s website at
investors.jernigancapital.com. To listen to a live broadcast, access the
site at least 15 minutes prior to the scheduled start time in order to
register and download and install any necessary audio software. The
replay of the webcast will be available on the Company’s website until
Thursday, May 16, 2019.

Supplemental financial and operating information for the quarter ended
March 31, 2019 is available on the Company’s website under Financials –
Quarterly Supplemental Information.

To Participate in the Telephone Conference Call:

Dial in at least 15 minutes prior to start time.

Domestic: 1-877-407-0792
International: 1-201-689-8263

Conference Call Replay:

Domestic: 1-844-512-2921
International: 1-412-317-6671
Passcode:
13681074

The replay can be accessed until midnight Eastern Time on Thursday, May
16, 2019.

About Jernigan Capital, Inc.

Jernigan Capital is a New York Stock Exchange-listed real estate
investment trust (NYSE: JCAP) that provides debt and equity capital to
private developers, owners and operators of self-storage facilities with
a view to eventual outright ownership of facilities we finance. Our
mission is to maximize shareholder value by accumulating a multi-billion
dollar investment portfolio consisting of the newest, most attractive
and best located self-storage facilities in the United States through a
talented and experienced team demonstrating the highest levels of
integrity, dedication, excellence and community.

Forward-Looking Statements

This press release includes “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995,
including statements relating to our full-year and second quarter 2019
guidance and the assumptions underlying such guidance, our ability to
successfully source, structure, negotiate and close investments in and
acquisitions of self-storage facilities, the market dynamics of the MSAs
in which our investments are located, our ability to fund our
outstanding future investment commitments, our ability to own and manage
our real estate assets, the availability, terms and our rate of
deployment of equity capital and our ability to increase the borrowing
base of our credit facility. The ultimate occurrence of events and
results referenced in these forward-looking statements is subject to
known and unknown risks and uncertainties, many of which are beyond our
control. These forward-looking statements are based upon the Company’s
present intentions and expectations, but the events and results
referenced in these statements are not guaranteed to occur. The Company
undertakes no duty or responsibility to publicly update or revise any
forward-looking statement to reflect future events or circumstances or
to reflect the occurrence of unexpected events. Investors should not
place undue reliance upon forward-looking statements. For a discussion
of these and other risks facing our business, see the information under
the heading “Risk Factors” in the Company’s Annual Report on Form 10-K,
and those set forth in the Company’s other reports and information filed
with the Securities and Exchange Commission (“SEC”), which are
accessible on the SEC’s website at www.sec.gov.

Non-GAAP Financial Measures

Adjusted Earnings is a non-GAAP measure and is defined as net income
attributable to common stockholders plus stock dividends to preferred
stockholders, stock-based compensation expense, depreciation and
amortization on real estate assets, depreciation and amortization on SL1
Venture real estate assets, and other expenses. Management uses Adjusted
Earnings and Adjusted Earnings per 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.”

Contacts

Jernigan Capital, Inc.
David Corak
(901) 567-9580
[email protected]