Spear Reit Ltd. · JSE:SEA
Spear Reit — Investor Presentation (February 2023)
20 slides from Spear Reit's investor presentation, Feb 28, 2023
Slide 1: Pre-Close Investor Presentation
Pre-Close Investor Presentation YEAR ENDED 28 FEBRUARY 2023 PRESENTATION DATE: 28 FEBRUARY 2023 PROPERTY PEOPLE PLANET PRE-CLOSE INVESTOR PRESENTATION / YEAR ENDED 28 FEBRUARY 2023 11
Slide 2: Table of Contents
TABLE OF CONTENTS 1. ENVIRONMENTAL UPDATE 2. SPEAR OPERATIONAL UPDATE 3. FY2023 SALIENT DETAILS − YTD JANUARY 2023 4. SECTORAL PERFORMANCE − FY2023 5. OUTLOOK Radnor Road, Bellville 6. GUIDANCE 7. QUESTIONS PRE-CLOSE INVESTOR PRESENTATION / YEAR ENDED 28 FEBRUARY 2023 22
Slide 3: Environmental Update
01 ENVIRONMENTAL UPDATE EMAIL QUESTIONS TO INFO@SPEARPROP.CO.ZA Mega Park, Bellville PRE-CLOSE INVESTOR PRESENTATION / YEAR ENDED 28 FEBRUARY 2023 33
Slide 4: Environmental Update: The Mission and Operating Environment
1. ENVIRONMENTAL UPDATE THE MISSION To be the leading Western Cape-focused REIT and to consistently grow our distribution per share ahead of inflation and within the top quartile of our peer group. YTD JANUARY 2023 OPERATING ENVIRONMENT – LIGHT IN THE DARKNESS YTD FY2023 operating context has been O
Slide 5: Spear Operational Update
02 SPEAR OPERATIONAL UPDATE Viking Business Park, Epping PRE-CLOSE INVESTOR PRESENTATION / YEAR ENDED 28 FEBRUARY 2023 55
Slide 6: Operational Update
2. SPEAR OPERATIONAL UPDATE YTD JANUARY 2023 OPERATIONAL UPDATE FY2023 OPERATIONAL FOCUS AREA CURRENT STATUS Commercial vacancy exposure mitigation Commercial Uptick in letting enquiries continues Vacancy creep mitigation Vacancy Interest rates Increase in portfolio letting activity = encouraging ma
Slide 7: Salient Details
03 SALIENT DETAILS YTD JANUARY 2023 Blackheath Park, Blackheath PRE-CLOSE INVESTOR PRESENTATION / YEAR ENDED 28 FEBRUARY 2023 77
Slide 8: Portfolio Snapshot
3. SALIENT DETAILS − YTD JANUARY 2023 PORTFOLIO SNAPSHOT 30 ASSETS NUMBER OF PROPERTIES R4.24BN (0.85%) R146M R10 303/M2 ASSET VALUE ASSET VALUE AVERAGE AVERAGE PROPERTY DECREASE PROPERTY VALUE VALUATION (FY2022) LETTING 7.4% AVERAGE IN-FORCE ESCALATIONS 426 531M2 93% 27 MONTHS R96.20/M2/PM GLA OCCU
Slide 9: Financial Snapshot
3. SALIENT DETAILS − YTD JANUARY 2023 FINANCIAL SNAPSHOT PROPOSED ON TRACK DISTRIBUTION FINAL PAYOUT RATIO TO BOARD 5%−7% DIPS GROWTH FORECAST PROPOSED 95% FINAL ±93% FY2023 43.41% SA REIT COST-TO- 6.50% SA REIT ADMIN 95% PAYOUT RATIO AVERAGE INCOME RATIO COST-TO-INCOME TANGIBLE NET ASSET VALUE (TNA
Slide 10: Total Collections
3. SALIENT DETAILS − YTD JANUARY 2023 TOTAL COLLECTIONS (AS AT 23 FEBRUARY 2023) 96% 100% R574 310 R560 835 97.65% COLLECTED TO BILLED YTD BILLED (R’000) COLLECTED COLLECTED (R’000) PER SECTOR TO BILLED 97% 99% Collections include billings for February 2023 Year-to-date collections have been in line
Slide 11: Letting Activity
3. SALIENT DETAILS − YTD JANUARY 2023 LETTING ACTIVITY YTD FY2023 Expiries and Gross rental Average gross Renewals/ Gross new Average gross Rental vacated at expiry expiry rental New lets rental new rental reversion GLA R'000 R/m² GLA R'000 R/m² % Commercial 29 489 4 399 149 24 830 3 561 143 (3.86)
Slide 12: Balance Sheet and Funding Update
3. SALIENT DETAILS − YTD JANUARY 2023 FEB 2023 BALANCE SHEET AND FUNDING UPDATE FORECAST FY2022 COVENANTS WEIGHTED AVERAGE 33 39 FEB 2023 VARIABLE EXPIRY MONTHS MONTHS COVENANTS YTD JAN 2023 FORECAST WEIGHTED AVERAGE 19 31 FIXED EXPIRY MONTHS MONTHS 36.50% LTV 50% 39.80% TO YTD JULY FY2022 37.50% WE
Slide 13: Sectoral Performance
04 SECTORAL PERFORMANCE FY 2023 Northgate Park, Brooklyn PRE-CLOSE INVESTOR PRESENTATION / YEAR ENDED 28 FEBRUARY 2023 13 13
Slide 14: Sectoral Performance: Retail, Commercial, Industrial
4. SECTORAL PERFORMANCE − YTD 2023 OPERATING ENVIRONMENT RECOVERING AMID MACRO CHALLENGES RETAIL (48 951M2 GLA) COMMERCIAL (131 379M2 GLA) INDUSTRIAL (229 538M2 GLA) Trading has been consistent with positive tenant Letting activity improving across office Robust performance, well located and versati
Slide 15: Hospitality and General Business and Portfolio Update
4. SECTORAL PERFORMANCE − YTD 2023 HOSPITALITY (16 663M2 GLA) GENERAL BUSINESS AND PORTFOLIO UPDATE 15 on Orange delivering 100% fixed net income to Spear to end-January 2023 Operating environment remains challenging Disposal effective date: 2 February 2023 Industrial and Retail portfolio trading re
Slide 16: Outlook
05 OUTLOOK Nampak, Epping PRE-CLOSE INVESTOR PRESENTATION / YEAR ENDED 28 FEBRUARY 2023 16 16
Slide 17: Outlook
5. OUTLOOK OUTLOOK The Western Cape real estate sector has maintained resilience across Management remains committed to further NAV unlock for property types YTD shareholders through the development and redevelopment of embedded portfolio bulk rights and share buybacks Good governance across provinc
Slide 18: Guidance
06 GUIDANCE Blackheath Park, Blackheath PRE-CLOSE INVESTOR PRESENTATION / YEAR ENDED 28 FEBRUARY 2023 18 18
Slide 19: Guidance
6. GUIDANCE ASSETS GUIDANCE Spear’s FY2023 guidance as advised to the market in May 2022 remains on track, being a DIPS growth of 5%–7% on CONSISTENT FY2022 DIPS. OBSESSIVE TENANTS FOCUS FY2023 guidance was based on the following assumptions: • No further Covid-related lockdowns • Vacancies are redu
Slide 20: Thank You / Questions
7. QUESTIONS THANK YOU QUESTIONS? Email questions to info@spearprop.co.za Live Q&A with CEO and CFO after presentation Sable Square, Minerton PRE-CLOSE INVESTOR PRESENTATION / YEAR ENDED 28 FEBRUARY 2023 20 20