communities that thrive...2021/03/04 · ipo –3q10 4q20 ipo –3q10 4q20 80.3% $10.43 88.2%...

INVESTOR PRESENTATION

COMMUNITIESTHAT THRIVELOCAL CONNECTIONS

FOURTH QUARTER 2020

WHITESTONE RE IT INVESTOR PRESENTATION FOURTH QUARTER 20202

SERVING OURSTAKEHOLDERS

SERVING SHAREHOLDERS by generating attractive

returns from properties that appreciate in value and

hedge against inflation

SERVING LOCAL NEIGHBORHOODS by leasing,

managing, owning and operating community centers

in Texas and Arizona’s fastest growing cities

SERVING ENTREPRENEURIAL TENANTS to achieve

the American dream and mitigating against economic

downturns successfully

WHITESTONE REIT


AT A GLANCE:(1)

Properties 58

Gross Leasable SF 5.0 Million

Tenants 1,391

Occupancy 88.2%

Consecutive Monthly Dividends(2)

126

Average Base Rent/SF $19.43

Total Enterprise Value(3)

$1.045 Million

Total Estimated Real Estate Asset Value(4)

$1.3 Billion

Credit Facility $515.0 Million

Long Term Bonds $100.0 Million

Equity Market Capitalization(3)

$399.5 Million

Management Team’s Collective Experience 60+ Years

Board Independence 5 of 6

Inside Ownership(5)

6.3%

WHITESTONE REIT


WHAT CRITICAL FACTORS DRIVEWHITESTONE’S SUCCESS?

Premier Locations in High Growth Markets

“Consumer Driven” Business Model

Value Enhancement Focus

Capital Management & Strong Performance


WE OWN PROPERTIES WHEREPEOPLE WANT TO LIVE

Geographic Footprint(1)

WHITESTONE KNOWS ITS:

Markets

Neighborhoods

Consumers

Targeted Acquisition Strategy

PREMIER LOCATIONS IN HIGH

GROWTH MARKETS

1%

43%

15%

13%

28%

Chicago

Phoenix

Austin & SanAntonio

Dallas

Houston


WE OWN PROPERTIES WHEREPEOPLE ARE MOVING


GROWTH MARKETS

Austin 9.7%

San Antonio 8.8%

Phoenix 6.6%

Houston 8.0%

Dallas – Fort Worth 9.7%

Population in Millions

0 2 4 6 8

Estimated 5 – Year MSA

Population Growth Rate

2017 – 2022(1)

AZ

TX

CO

TNNC

GA

FL

CURRENT MARKETS

Texas

Houston, Austin, Dallas,Ft. Worth, San Antonio

Arizona

Phoenix, Scottsdale, Mesa, Gilbert, Chandler

POTENTIAL EXPANSION

Florida

Georgia

North Carolina

Tennessee

Colorado


PROPERTIES STRATEGICALLY SITUATED IN HIGH HOUSEHOLD INCOME NEIGHBORHOODS


GROWTH MARKETS

$109,625

$105,606

$101,108

$96,240 $95,182$93,494

$91,011

$88,765

$83,796$81,939 $81,162

$78,298

$75,234 $74,466

$70,833$69,533

$51,241

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

UBA FRT BFS REG WSR ROIC RPAI UE KIM AKR RPT SITC KRG WRI CDR BRX WHLR

Median H

HI (3 m

ile radius)

17 Publicly Traded US Shopping center REITs

Peer

Average:

$85,149

National

Average:

$63,174


WE PROACTIVELY APPLY OURBUSINESS MODEL

WE ANALYZE

Demographic Analysis and Consumer

Psychographics

WE PROVIDE

Community Services to Consumers Not

Available Through eCommerce

WE DELIVER

Proactive Leasing and Property

Management

“CONSUMER DRIVEN” BUSINESS MODEL


WE ACQUIRE PROPERTIESTHAT ARE:

MISMANAGED

OVERLEVERAGED

FORECLOSED / IN RECEIVERSHIP


AND “TURN THEMAROUND”


WE ANALYZEOUR MARKETS

OPEN AIR DESIGNS

& Gathering Areas

EXPANDABLE

Square Footage

TARGETS

Entrepreneurial Tenants

CONSUMER

Centric Focus

OPTIMIZES

Lifestyle Mix

FULLY MANAGED

& Leased by Owner



OUR APPLIED USE OF CONSUMER PSYCHOGRAPHICS

1 The data collected through interviews and analytics helps in developing insights and translating it into the optimal tenant mix.

2 Application of psychographics to creatively design Whitestone’s communities.

3 Once the characteristics of the consumers are known, strengths and needed improvements of our target market become apparent.

4 Whitestone designs to differentiate our properties and customer experiences.

BABY BOOMER

GEN X

MILLENNIAL

GEN Z



OUR TENANT MIX

TENANT % of ABR(1)

% of GLA(1)

Restaurant & Food Service 23% 18%

Grocery 9% 14%

Financial Services 9% 6%

Salons 8% 7%

Medical & Dental 8% 7%

Non-Retail 6% 4%

General Retail 5% 7%

Apparel 4% 4%

Home Décor & Improvement 5% 7%

Education 4% 5%

Fitness 4% 5%

Local Services 3% 2%

Wireless 2% 1%

Off-Price 2% 4%

Pet Supplies & Services 2% 2%

Entertainment 2% 2%

Pharmacy & Nutrition 2% 2%

Sporting Goods 1% 1%

Postal Services 1% 1%

Automotive Supply & Services - 1%

Other - -

Total 100% 100%



WE PROACTIVELY LEASE TO CRAFTTHE OPTIMAL TENANT MIX


9.4%

8.2%

7.0%

10.3% 10.1% 10.0%

8.9%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

2014 2015 2016 2017 2018 2019 2020

Leasing Spreads(1)

862966

676 638724

953 982

0

200

400

600

800

1000

1200

2014 2015 2016 2017 2018 2019 2020

Executed Leases Sq. Ft.

(New and Renewal)


Upcoming Lease Expirations

(Sq. Ft. in 000’s)

• Weighted average remaining lease term= 4.0 years

• Potential to capture growth from below market leases

WE PROACTIVELY LEASE TO CRAFTTHE OPTIMAL TENANT MIX(continued)


Whitestone has nationally-

aligned, commission-driven

leasing teams that employ 5

key practices:

1 Shorter duration, 3 – 5 year terms

2 Annual increases of 2 – 3%

3 Personal guarantees

4 No lease covenants

5 No lease co-tenancies

783

654 593

689 654

265

162 146 160

65

-

200

400

600

800

2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Expiring Leases Sq. Ft.


WE CAPITALIZE ON THE INTRINSIC VALUE IN OUR PORTFOLIO

VALUE ENHANCEMENT FOCUS

Expanding Tenant Space and Property Square Footage

Development and Redevelopment

Increasing Occupancy in Turnaround Properties

Growing Property NOI Square Foot by Square Foot


OUR RESULTS CONFIRM OUR LONG-TERM APPROACH TO INCREASING VALUE


YEARS VALUE-ADD

2010/2011 35%

2012 20%

2013 21%

YEARS VALUE-ADD

2014 6%

2015 4%

2016/2020 8%

Improved yields by 173bps on average on acquisitions from 2010 to 2020

Number ofGLA

Sq. Ft. in Unlevered Yield on Total Cost

Acquisitions (000's) Initial(1) Current(2) Change (bps)

2010/2011 10 658 7.1% 9.4% +225bps

2012 5 675 7.2% 8.6% +143bps

2013 5 677 7.2% 8.7% +151bps

'10-'13 Total / W.A.(3) 20 2,011 7.2% 8.9% +173bps

Early results improving yields on more recent acquisitions (2014 – 2020)

Number ofGLA

Sq. Ft. inUnlevered Yield on Total Cost

Acquisitions (000's) Initial(1) Current(2) Change (bps)

2014 8 631 7.5% 8.0% +45bps

2015 7 482 6.7% 6.9% +24bps

'14-’20 Total / W.A.(3) 20 1,898 6.8% 7.2% +43bps

2016/2020 5 778 6.6% 7.1% +50bps


OUR VALUE-ADD BEGINS AT THE TIME OF ACQUISITION & CONTINUES...with operational results that have produced increasing occupancy and growing rent per square foot.


OPERATING STATISTICS

2010 - 2020

Occupancy Growth 10%

ABR Growth 86%

IPO – 3Q10 4Q20 IPO – 3Q10 4Q20

80.3% $10.43

88.2% $19.43

OCCUPANCY ABR PER SQ.FT.

INCREASING OCCUPANCY GROWING RENT LEVELS


GROW VALUE AND MINIMIZE RISK


(20.00)

(15.00)

(10.00)

(5.00)

0.00

SSNOI Growth Rate FY20 Change Due to COVID (%)

WSR: -4%Peer Average: -9.31%

SAME STORE NOI PERFORMS BETTER THAN PEER AVERAGE IN GOOD YEARS:

SAME STORE NOI PERFORMS BETTER THAN PEERS IN DOWN YEARS:

(1.00)

(0.50)

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

SSNOI Growth Rate FY18 Change (%)

WSR: +3.3%Peer Average: +1.8%

WSR: +2.4%Peer Average: +2%

(5.00)

(4.00)

(3.00)

(2.00)

(1.00)

0.00

1.00

2.00

3.00

4.00

5.00

SSNOI Growth Rate FY19 Change (%)


WE INCREASE SHAREHOLDER VALUE…through prudent capital allocations


INVESTMENTS ARE RISK ADJUSTED

Category Anticipated Return

Acquisitions 10% to 12%

Re-Development 12% to 15%

Development 15% to 18%



ANNUAL ACQUISITION VOLUME

(in millions)

$250

$200

$150

$100

$50

$-

2011 2012 2013 2014 2015 2016 2017 2018 to

2020

POST

COVID-19

WE INCREASE SHAREHOLDER VALUE…through investment in acquisitions


WE INCREASE SHAREHOLDER VALUE…through development & redevelopment


IDENTIFIED STRATEGIC

DEVELOPMENTS (4)

• Total Investment Cost: $199.1M

• Incremental NOI: $19.7M

• Unlevered Return: 9.9%

• Market Value @ 6% Cap Rate: $328.6M

• Value Created: $129.5M

IDENTIFIED TACTICAL

DEVELOPMENTS/REDEVELOPMENTS (6)



• Unlevered Return: 34%



IDENTIFIED PAD SITE

DEVELOPMENTS (13)



• Unlevered Return: 9.4%




CASE STUDY: OUR FUTURE STRATEGIC DEVELOPMENT OPPORTUNITIES


BLVD DEVELOPMENT

Uptown, Houston

• Purchased in 2017

• Rooftop cinema added in 2018

• Entitled for future development, 1.4 acres

• 137K add’l GLA: mixed use, retail & office

• Development cost: $72M

• NOI: $6.8M

• Potential value add: $40M

MIXED USE, RETAIL, OFFICE

OPEN-AIR

ROOFTOP

CINEMA


CASE STUDY: OUR FUTURE STRATEGIC DEVELOPMENT OPPORTUNITIES(continued)


VILLAGE SQUARE

DEVELOPMENT

Mesa, Arizona

• Purchased in 2013

• Entitled for future – 4.7 acres

• 200K add’l GLA: mixed use, retail & office

• 340 unit multifamily & hotel pad sites to lease

• Development cost: $115M

• NOI: $11.3M

• Potential value add: $87M

340 UNIT MULTIFAMILY

HOTEL PAD SITE

GROUND LEASEMIXED USE, RETAIL, OFFICE


CAPITAL MANAGEMENT

& STRONG PERFORMANCE

COVID-19 RESPONSEOur Business Discipline for a Downturn Ensured Capital Preservation & Improved Financial Flexibility

BALANCE SHEET

ACTIONS TAKEN

OPERATIONAL

PERFORMANCERESULTS TO DATE

• $30.0M Credit Facility Draw Down

• $31.0M Dividend Reduction

• $30M COVID Borrowings Repaid

by Year End 2020

• $50.0M Pending Acquisition Suspended

• +$1.0M Expense Reduction

• Dividend Increased 2.4%

in February 2021

• $230.0M Development Pause

SHOPPING CENTER INDUSTRY

LEADING RENTAL REVENUE

COLLECTIONS(1)

Quarter WSR

Peer Group

Average

2Q20 81% 72%

3Q20 90% 87%

4Q20 95% 93%


CAPITAL MANAGEMENT


WE ALLOCATE CAPITAL ACROSS THE PORTFOLIO AND TO NEW ACQUISITIONS

We maintain a capital investment

management strategy to:

1. Make new acquisitions

2. Re-develop and upgrade our existing

properties and

3. Build on land adjacent to our

properties throughout the portfolio


5-Year Goal

5-Year Goal

CAPITAL MANAGEMENT


LONG-TERM GOALSReducing Leverage and G&A as a Percent of Revenue

LOWERING DEBT LEVERAGE

• Increasing cash flows from lease up of vacant spaces and rate increases• Selectively disposing of “highly levered” properties• Financing future acquisitions with a lower debt component

SCALING G&A

• Reducing general and administrative expenses• Increasing revenue through lease up of vacant spaces and rental rate increases• Growing our asset base

Debt/EBITDA Ratio

4Q15

8.95x

4Q17

8.5x

Feb 2018

Long Term Plan

Announced

2023

6x – 7x

Year End

2020

9.2x (1)

G&A/Revenue

4Q15

20%

4Q17

18.8%

2023

8% – 10%

Year End

2020

16.9% (1)

…

…

Feb 2018

Long Term Plan

Announced


CAPITAL MANAGEMENT


TRACK RECORDDespite COVID, Whitestone Still Produced Industry Leading, Long-term, Positive Total Shareholder Returns(YEAR ENDING 12.31.20)

80

70

60

50

40

30

20

10

0

WSR

UB

A

RO

IC

WR

I

BR

X

REG

KR

G

BFS

KIM

RP

AI

RP

T

FRT

UE

AK

R

SITC

CD

R

WH

LR

Pe

rce

nta

ge R

etu

rn (

%)

17 Publicly Traded US Shopping Center REITS

WSR #1 in Shopping Center Industry Total Shareholder Return % - 5 Year

WSR TSR: +1.13%Peer Average TSR: -29.82%


CAPITAL MANAGEMENT


TRACK RECORDSignificant Growth Rates Despite Industry Headwinds

2020 REVENUE 2020 NOI

$21.6

$28.2

$37.8

$47.2

$62.1

$70.3

$83.8

$89.9 $88.6

2011 2012 2013 2014 2015 2016 2017 2018 2019

CAGR – 13.4%

$9,627 $13,017

$20,796

$28,153

$35,754 $39,379

$47,090 $48,778

$44,935

2011 2012 2013 2014 2015 2016 2017 2018 2019

CAGR – 9.8%

2020 COVID

5 – YEAR CAGR(1)

6.2% Growth in Revenue

6.2% Growth in NOI

2.6% Growth in FFO Core

$46.6

$62.1$72.4

$93.4$104.4

$126.0$133.8 $130.8

$125.9

2012 2013 2014 2015 2016 2017 2018 2019 2020COVID

CAGR: 6.2%

$28.2

$37.8

$47.2

$62.1$70.3

$83.8$89.9 $88.6

$83.9

2012 2013 2014 2015 2016 2017 2018 2019 2020COVID

CAGR: 6.2%

$13,017

$20,796

$28,153

$35,754$39,379

$47,090$48,778$44,935

$40,704

2012 2013 2014 2015 2016 2017 2018 2019 2020COVID

CAGR: 2.6%

12.6% Growth in Revenue

13.4% Growth in NOI

9.8% Growth in FFO Core

2019 PRE-COVID

5 – YEAR CAGR(1)

2020 FFO CORE


CAPITAL MANAGEMENT


TRACK RECORDCreating Long-Term Value: 15 Years of Sustained Growth

Year Revenue NOI FFO-Core Dividends Debt, netBookEquity

WAShares NAV/Share NAV

Estimated Cap Rate

Market Value

ImpliedCap Rate

NAV Above (Below) Market

Value

2020 $125,793 $83,903 $40,704 $25,714 $628,298 $338,326 43,811 $17.58 $1,398,383 6.0% 8.6% $420,912

2019 130,860 88,578 44,935 46,682 640,310 353,098 42,386 $ 19.72 $ 1,476,300 6.0% 7.3% $ 258,693

2018 133,856 89,949 48,778 46,099 644,119 359,150 41,623 $ 20.54 $ 1,499,150 6.0% 7.8% $344,733

2017 125,959 83,849 47,090 41,713 655,924 358,318 37,343 $ 23.03 $ 1,516,094 6.0% 7.6% $ 322,058

2016 104,437 70,345 39,379 32,640 541,344 267,643 29,025 $ 20.07 $ 1,123,788 6.6% 7.7% $ 165,064

2015 93,416 62,081 35,754 28,946 497,160 246,991 26,113 $ 16.61 $ 930,986 7.2% 8.3% $ 120,209

2014 72,382 47,230 28,153 26,089 389,857 213,323 23,264 $ 14.62 $ 730,000 7.6% 7.5% $ (11,376)

2013 62,145 38,635 20,796 20,985 257,786 220,915 18,869 $ 14.33 $ 528,255 8.5% 8.8% $ 18,190

2012 46,554 28,915 13,017 16,328 184,064 172,887 14,461 $ 13.68 $ 381,880 9.0% 8.9% $ (5,361)

2011 34,915 21,588 9,627 12,019 122,195 130,707 10,747 $ 15.68 $ 290,700 9.0% 10.5% $ 40,616

2010 31,533 19,250 7,920 7,407 83,350 84,283 5,856 $ 20.37 $ 202,632 9.5% 11.3% $ 32,613

2009 32,685 19,694 8,618 6,926 95,507 66,859 5,261 $ 19.28 $ 196,940 10.0%

2008 31,201 18,366 4,236 8,672 87,014 67,172 5,261 $ 18.37 $ 183,660 10.0%

2007 30,982 18,029 6,001 9,507 72,650 52,843 5,261 $ 20.46 $ 180,290 10.0%

2006 29,840 16,307 8,993 9,831 58,065 58,914 5,261 $ 19.96 $ 163,070 10.0%


OUR COMMITMENT TOESG INITIATIVESManages investment risk and ensures sustainability for our stakeholders

1 | Environmental Highlights

2 | Social Highlights

3 | Corporate Governance Highlights

4 | COVID-19 Response

CAPITAL MANAGEMENT



IMPLEMENTED ESG INITIATIVES

• Implementation of an ESG Committee.

• Published Whitestone’s inaugural Corporate Responsibility & Sustainability Report in 2020.

• Engagement with ESG rating agencies, proxy advisors and ESG benchmarking platforms including ISS ESG, SASB, GRESB, S&P, MSCI, Sustainalytics , Bloomberg and others to target areas of improvement.

• Formal establishment of ESG policies: Sustainability Statement; Human Rights Policy; Vendor Code of Conduct; OSHA Policy and a Charter for the ESG Committee.

• Inaugural participation in ISS ESG and SSgA R-Factor surveys in 2020.

CAPITAL MANAGEMENT



1 | ENVIRONMENTAL HIGHLIGHTS

• In 2021, initiated a Green-e Energy Certified Efficiency Program and executed contracts of approximately 22 million kilowatt hours

• On-going transition to energy efficient lighting, air filtration systems, and roofing

• Replaced 40,000 sf of roofing with environmentally-friendly, 0% ozone-depleting and CFC free material

• Installed replacement LED lighting across approximately 20% of our portfolio.

• On-going assessment and installation of recharging stations for electric vehicles

• Improving walkability and accessibility at properties by designing walking and bicycle paths

• Retrofitting properties to comply with ADA standards

CAPITAL MANAGEMENT



2 | SOCIAL HIGHLIGHTS

• In 2020, improved our ISS “Social’ score from a “10” to a “2” rating (Rating Scale: 1 to 10; “1” being the best)

• Properties serve multi-culturally diverse neighborhoods with ~85 Whitestone employees that speak over 30 different languages and dialects

• Whitestone’s Charitable & Philanthropic Activities where members of senior management donate a percentage of their personal time to develop, teach and train junior associates; teach and lecture at well-regarded universities; perform volunteer work with organizations in Kenya, Rwanda, and India; and donate personal time and money to special causes.

CAPITAL MANAGEMENT



3 | CORPORATE GOVERNANCE HIGHLIGHTS

• Board declassification with annual elections of all Trustees began in 2020

• Appointment of Lead Independent Director in 2019

• Five out of six 2020 Trustees are Independent

• Independent Compensation Consultant since 2018

• Engaged in executive compensation discussions with 87% of our institutional shareholder base and improved our 2020 Say on Pay Vote result from 36% to over 70% in just two years.

• Engagement with ISS Consulting since 2018

• Stock ownership guidelines for NEOs established in 2018: 3-5x base salary

CAPITAL MANAGEMENT



4 | COVID-19 RESPONSE

• Maintaining open lines of communication and are in contact with 100% of our tenants

• Established Whitestone REIT’s “COVID CARES” Tenant Counseling team to work closely with tenants helping them apply for COVID 19 CARES Act Relief Resources, including the Paycheck Protection Program (PPP loans), the U.S. Small Business Administration (SBA) Coronavirus Assistance program, and other resources

• Created a website link providing stakeholders with information regarding healthcare related best practices and local/regional updates regarding operations at our centers during the crisis

CAPITAL MANAGEMENT



• We have a premier portfolio

• We are strategy driven and execution focused to produce results

• We have the platform to produce excellence in execution

• We have significant opportunities for growth

• We have a track record of superior return on investment

• We have a strong belief in the value of diversity, sustainability and good corporate governance


APPENDIX

• Forward-Looking Statements

• FFO, FFO Core , NOI , and EBITDA Reconciliation

• Footnotes


FORWARD-LOOKING STATEMENTSThis presentation contains forward looking statements within the meaning of Section 27 A of the Securities Act of 1933 as amended, and Section 21 E of the Securities Exchange Act of 1934 as amended Forward looking statements provide our current expectations or forecasts of future events and are not statements of historical fact These forward looking statements include information about possible or assumed future events, including, among other things, discussion and analysis of acquisitions and the impact of such acquisitions on Whitestone REIT, or the Company, including expected financing developments, capitalization rates and internal rates of return, the financial condition and results of operations of the Company, anticipated capital expenditures required to complete projects, amounts of anticipated cash distributions to the Company’s shareholders in the future and other matters These forward looking statements are not historical facts but are the intent, belief or current expectations of the Company’s management based on its knowledge and understanding of the Company’s business and industry Forward looking statements are typically identified by the use of terms such as “ may,”“ will,”“ should,”“ potential,”“ predicts,”“ anticipates,”“ expects,”“ intends,”“ plans,”“ believes,”““or the negative of such terms and variations of these words and similar expressions, although not all forward looking statements include these words These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond the Company’s control, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward looking statements.

Forward-looking statements that were true at the time made may ultimately prove to be incorrect or false You are cautioned not to place undue reliance on forward looking statements The Company undertakes no obligation to update or revise forward looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results Factors that could cause actual results to differ materially from any forward looking statements made in this presentation include the Company's ability to meet its long term goals, its assumptions regarding its earnings guidance, including its ability to execute effectively its acquisition and disposition strategy, to continue to execute its development pipeline on schedule and at the expected costs, and its ability to grow its NOI as expected, which could be impacted by a number of factors, including, among other things, its ability to continue to renew leases or re let space on attractive terms and to otherwise address its leasing rollover its ability to successfully identify, finance and consummate suitable acquisitions, and the impact of such acquisitions, including financing developments, capitalization rates and internal rate of return the Company’s ability to reduce or otherwise effectively manage its general and administrative expenses, including in connection with the recent proposed nomination of trustees by a shareholder of the Company the Company’s ability to fund from cash flows or otherwise distributions to its shareholders at current rates or at all current adverse market and economic conditions lease terminations or lease defaults the impact of competition on the Company's efforts to renew existing leases changes in the economies and other conditions of the specific markets in which the Company operates economic, legislative and regulatory changes, including the impact of the Tax Cuts and Jobs Act of 2017 the success of the Company's real estate strategies and investment objectives and the Company's ability to continue to qualify as a REIT under the Internal Revenue Code of 1986 as amended The forward-looking statements should be read in light of these factors and the factors identified in the “Risk Factors” included in the Company’s most recent Annual Report on Form 10 K, Quarterly Reports on Form 10 Q and other reports and information that it files with the Securities and Exchange Commission, or the SEC

This presentation is not an offer to sell, nor a solicitation of an offer to buy securities, nor shall there be any sale of securities in any state or jurisdiction in which the offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.

The Company obtained the industry, market and competitive position data used in this presentation from (i) its own internal estimates and research of third party company websites and other sources,sources, (ii) industry and general publications and research or (iii) studies and surveys conducted by third parties Such sources generally do not guarantee the accuracy or completeness of included information While the Company believes that the information included in this presentation from such publications, research, studies, surveys and websites is reliable, it has not independently verified data from these third party sources While the Company believes its internal estimates and research are reliable, neither such estimates and research nor such definitions have been verified by any independent source

This presentation contains supplemental financial measures that are not calculated pursuant to U S generally accepted accounting principles, or GAAP, including EBITDA, FFO, FFO Core, and NOI These non GAAP measures are in addition to, not a substitute for or superior to, measures of financial performance prepared in accordance with GAAP A reconciliation of non GAAP measures to GAAP measures is contained in the Appendix to this presentation.

APPENDIX


FFO(1), FFO Core(2), NOI(3), andEBITDA(4) Reconciliation

APPENDIX

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Net income attributable to Whitestone REIT 1.1$ 0.1$ 3.8$ 7.5$ 6.7$ 7.9$ 8.3$ 21.4$ 23.7$ 6.0$

Depreciation and amortization of real estate assets 7.6 10.1 13.3 16.0 19.7 22.2 26.3 25.4 26.5 28.1

Depreciation and amortization of real estate assets of unconsolidated real estate partnership 2.9 2.3 1.7

(Gain) loss on sale or disposal of assets and properties (0.2) 0.1 0.1 (1.8) 0.2 (3.3) 0.2 (4.5) (0.6) 0.4

(Gain) loss on sale of assets and properties of discontinued operations, net (0.6) -

Gain on sale or disposal of properties or assets of unconsolidated real estate partnership (6.3) (13.8) 0.1

Net income attributable to nonconrolling interests 0.2 - 0.1 0.2 0.1 0.2 0.2 0.6 0.5 0.1

FFO 8.7$ 10.3$ 17.3$ 21.9$ 26.7$ 27.0$ 35.0$ 39.4$ 38.0$ 36.4$

Rent support agreement - - 0.2 0.2 - - - - - -

Relocation agreement - 2.2 - - - - - - - -

Non cash share-based compensation - - 2.3 4.7 7.4 10.2 10.4 6.8 6.5 6.1

Legal settlement 0.2 (0.2) - - - - - - - -

Proxy contest costs - - - - - - - 2.5 - -

Early debt extinguishment costs of unconsolidated real estate partnership 0.1 - -

Gain on loan forgiveness (1.7)

Acquisition costs 0.7 0.7 1.0 1.4 1.7 2.1 1.6 - 0.4

FFO Core 9.6$ 13.0$ 20.8$ 28.2$ 35.8$ 39.4$ 47.0$ 48.7$ 44.9$ 40.7$

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020


General and Administrative Expenses 6.7 7.6 10.9 15.3 20.3 23.9 23.9 23.3 21.7 21.3

Depreciation and amortization 7.8 10.2 13.1 15.7 19.8 22.5 27.2 25.6 26.7 28.3

Executive Relocation Expense - 2.2 - - - - - - - -

Equity in earnings of real estate partnership (8.4) (15.1) (0.9)

Interest expense 6.4 8.7 10.0 10.6 14.9 19.2 23.7 25.2 26.3 25.8

Interest, dividend and other investment income (0.5) (0.3) (0.2) (0.1) (0.3) (0.4) (0.4) (1.0) (0.7) (0.2)

Provision for income taxes 0.2 0.3 0.3 0.3 0.4 0.3 0.4 0.3 0.4 0.4

(Gain) loss on sale or disposal of assets and properties (0.3) 0.1 - 0.1 0.2 (3.3) 0.2 (4.6) (0.9) (0.0)

Management fee, net of related expenses - - - - - - - (0.2) - 0.3


Loss (gain) on sale of assets and properties of discontinued operations, net - - - - - - - - (0.6)

Income from discontinued operations - - (0.3) (0.5) - - - - -

Loss on disposal of assets - - - - - - - 0.1 - 0.4

Gain on sale of property from discontinued operations - - - (1.9) - - - - 0.2

NOI, adjustments for unconsolidated real estate partnership - - - - - - - 7.7 6.3 4.2


NOI 21.6$ 28.9$ 37.8$ 47.2$ 62.1$ 70.3$ 83.8$ 89.9$ 88.5$ 83.9$

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020


Depreciation and amortization 7.8 10.2 13.4 16.0 19.8 22.5 27.2 25.7 26.7 28.3

Executive Relocation Expense - 2.2 - - - - - - -

Equity in earnings of real estate partnership (8.4) (15.0) (0.9)

Interest expense 6.4 8.7 10.2 10.6 14.9 19.2 23.7 25.2 26.3 25.8

Provision for income taxes 0.2 0.3 0.3 0.3 0.4 0.3 0.4 0.3 0.4 0.4

Profit sharing expense - - - - - - - - -

Loss on disposal of assets - - - - - - - 0.1 0.2 0.4

(Gain) loss on sale or disposal of properties 0.1 0.1 0.1 (1.8) 0.2 (3.3) 0.2 (4.6) (0.9)

Loss (gain) on sale of assets and properties of discontinued operations, net (0.6)


EBITDAre adjustments for unconsolidated real estate partnership - - - - - - - 7.4 5.9 3.5


EBITDAre 15.8$ 21.6$ 27.9$ 32.9$ 42.1$ 46.8$ 60.3$ 67.6$ 67.2$ 61.8$


FOOTNOTESPage 3:

(1) As of December 31, 2020 and WSR common shares and operating units of $7.97 per share, except where indicated.

(2) Through February 25, 2021.

(3) As of February 25, 2021 and WSR common shares and operating units of $9.43 per share

(4) Based on TTM NOI as of December, 31, 2020 at a capitalization rate of 6%.

(5) As of the latest Definitive Proxy Filing on April 3, 2020.

Page 5:

Note: Portfolio includes 1 property in Chicago.

(1) As a percentage of portfolio NOI as of September 30 , 2020.

Page 6:

Note: Portfolio includes 1 property in Chicago.

(1) Source: Claritas, 5 year projection as of April 2017.

Page 7:

(1) Source: S&P Global Market January 2020.

Page 13:

(1) As of September 30, 2020

Page 14:

(1) Annual leasing spread represents the year over year percentage increase in contractual rent per square foot for lease

renewals and new leases executed during the trailing twelve months for the respective period.

Page 18:

Source: Company management.

(1) Initial yield calculated as initial NOI divided by purchase price.

(2) Current yield defined as 1Q20 property level NOI annualized divided by gross book value of real estate assets,

undepreciated as of March 31, 2020.

(3) Weighted average calculated based on gross invested capital (purchase price plus additional investment)

Page 19:

(1)

Page 27:

(1) Source: Company filings as of December 24, 2020. Peers include Acadia Realty Trust, Brixmor Property Group Inc.,

Cedar Realty Trust Inc., Federal Realty Investment Trust, Kimco Realty Corp., Kite Realty Group Trust, RPT Realty, Regency

Centers Corp., Retail Opportunity Investments Corp., Retail Properties of America, Inc., Saul Centers Inc., Site Centers Corp,

Urban Edge Properties, Urstadt Biddle Properties Inc., Weingarten Realty Investors, and Wheeler REIT Inc.

Page 29:

(1) Year ended December 31, 2019, includes pro rata share of revenue from equity investment in real estate partnership.

APPENDIX

Page 31:

(1) Note: Dollars in millions, CAGR Timeframe January 1, 2016 through December 31, 2020. Includes Pro rata share of investment in real estate partnership.

Page 32:

(1) Includes pro rata share of equity investment in real estate partnership .

(2) Based on the share price on the December 31st of the corresponding year.

Page 42:

(1) FFO: Management believes that FFO is a useful measure of the Company's operating performance. The Company computes FFO as defined by NAREIT, which

states that FFO should represent net income available to common shareholders (computed in accordance with GAAP) excluding gains or losses from sales of

operating assets, impairment charges and extraordinary items, plus depreciation and amortization of operating properties, including the Company's share of

unconsolidated real estate joint ventures and partnerships. FFO does not represent cash flows from operating activities determined in accordance with GAAP and

should not be considered an alternative to net income as an indication of the Company's performance or to cash flow from operations as a measure of liquidity or

ability to make distributions and service debt. Management considers FFO a useful additional measure of performance for an equity REIT because it facilitates an

understanding of the operating performance of its properties without giving effect to real estate depreciation and amortization, which assumes that the value of real

estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, management believes that FFO

provides a more meaningful and accurate indication of the Company's performance and useful information for the investment community to compare Whitestone

to other REITs since FFO is generally recognized as the industry standard for reporting the operations of REITs. Other REITs may use different methodologies for

calculating FFO, and accordingly, the Company's FFO may not be comparable to other REITs. The Company presents FFO per diluted share calculations that are

based on the outstanding dilutive common shares plus the outstanding OP units for the periods presented.

(2) FFO Core: Management believes that the computation of FFO in accordance with NAREIT's definition includes certain non-cash and non-comparable items that

affect the Company's period-over-period performance. These items include, but are not limited to, legal settlements, non-cash share-based compensation expense,

rent support agreement payments received from sellers on acquired assets and acquisition costs. In addition, the Company believes that FFO Core is a useful

supplemental measure for the investing community to use in comparing the Company to other REITs as many REITs provide some form of adjusted or modified

FFO. However, other REITs may use different adjustments, and the Company's FFO Core may not be comparable to the adjusted or modified FFO of other REITs.

(3) NOI: Management believes that NOI is a useful measure of the Company's property operating performance. The Company defines NOI as operating revenues

(rental and other revenues) less property and related expenses (property operation and maintenance, insurance and real estate taxes). Because NOI excludes

general and administrative expenses, depreciation and amortization, involuntary conversion, interest expense, interest income, provision for income taxes, gain or

loss on sale or disposition of assets and capital expenditures and leasing costs, it provides a performance measure that, when compared year over year, reflects the

revenues and expenses directly associated with owning and operating commercial real estate properties and the impact to operations from trends in occupancy

rates, rental rates and operating costs, providing perspective not immediately apparent from net income. The Company uses NOI to evaluate its operating

performance since NOI allows the Company to evaluate the impact of factors, such as occupancy levels, lease structure, lease rates and tenant base, have on the

Company's results, margins and returns. In addition, management believes that NOI provides useful information to the investment community about the Company's

property and operating performance when compared to other REITs since NOI is generally recognized as a standard measure of property performance in the real

estate industry. However, NOI should not be viewed as a measure of the Company's overall financial performance since it does not reflect general and

administrative expenses, depreciation and amortization, involuntary conversion, interest expense, interest income, provision for income taxes, gain or loss on sale

or disposition of assets, and the level of capital expenditures and leasing costs necessary to maintain the operating performance of the Company's properties.

Other REITs may use different methodologies for calculating NOI, and accordingly, the Company's NOI may not be comparable to that of other REITs.

(4) EBITDA: Management believes that EBITDA is an appropriate supplemental measure of operating performance to net income attributable to the Company. The

Company defines EBITDA as operating revenues (rental and other revenues) less property and related expenses (property operation and maintenance, insurance

and real estate taxes) and general and administrative expenses. Management believes that EBITDA provides useful information to the investment community about

the Company's operating performance when compared to other REITs since EBITDA is generally recognized as a standard measure. However, EBITDA should not

be viewed as a measure of the Company's overall financial performance since it does not reflect depreciation and amortization, involuntary conversion, interest

expense, provision for income taxes, gain or loss on sale or disposition of assets, and the level of capital expenditures and leasing costs necessary to maintain the

operating performance of the Company's properties. Other REITs may use different methodologies for calculating EBITDA and, accordingly, the Company's EBITDA

may not be comparable to other REITs.

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