CoreCivic Investor Presentation Q4 2020
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Core Value is in the Real Estate, But Our Business Model is Flexible
We have been responsive to the needs of our government partners and those needs have evolved over our nearly 40
year history
•
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Early Stages
Operational Cost Efficiencies →
Private sector operating existing government
owned facilities (Emergence of Managed-
Only Model)
Rapid Population Growth → New
government owned facility construction with the
private sector providing the operations
(Expansion of Managed-Only Model)
Emerging Federal Needs → Federal law
enforcement agencies had emerging capacity
needs (Emergence of Owned/Managed
Model)
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●
Rapid Growth Phase
Rapid Population Growth & Lack of
Appropriations for New Capacity →
Our federal and state partners increasingly
found it difficult to receive sufficient funding to
meet their capacity needs, which led to the
private sector delivering a real estate solution
(Growth of Owned/Managed Model)
Continuing Federal Needs → Federal
law enforcement agencies continued to have
expanded capacity needs, and they did not
have a desire to operate detention facilities
(Growth of Owned/Managed Model)
Current Market
• Inmate Population Growth Slows → Reduction in the need for new facility
construction to expand capacity & increasingly competitive market in the Managed-
Only business compresses margins (Exit Managed-Only Model)
•
•
Aging Correctional Infrastructure → Existing stock of government owned
correctional facilities have reached the end of their useful life. Appropriations for
replacement capacity remains unavailable, but our partners have a desire to
maintain government operations (Emergence of Lease-Only Model)
Existing Capacity → Privately owned correctional infrastructure provides
mission-critical capacity to our government partners (Continuation of
Owned/Managed Model)
Continuing Federal Needs → Federal law enforcement agencies continue
to depend on the real estate provided by the private sector and are not interested
in changing their law enforcement mission (Continuation of Owned/Managed
Model)
Real Estate continues to be the biggest challenge to our government partners due to the high cost of construction, but
some partners are interested in government controls of the day-to-day facility operations. This led to the creation of
the lease-only model provided in our CoreCivic Properties segment
We have successfully converted multiple facilities from an owned/operated model in
our Safety segment to the lease-only model provided in our Properties segment¹
CoreCivic currently leases to states our California City Corrections Center, Southeast Correctional Complex and North Fork Correctional Facility, each of which was previously Company operated.
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