GCP Asset Backed Income Fund Ltd. · LSE:GABI
GCP Asset Backed Income Fund — GCP Student Living — H1 FY2021 Earnings Presentation
29 slides from GCP Asset Backed Income Fund's earnings presentation, March 2021
Slide 1: Student December 2020 Interim Results
STUDENT DECEMBER 2020 INTERIM RESULTS March 2021
Slide 2: Important Notice
IMPORTANT NOTICE This presentation (the "Presentation") has been prepared by Gravis No undertaking, representation, warranty or other assurance, express or Capital Management Limited (the "Investment Manager“ or “Gravis”) and implied, is made or given by or on behalf of the Company or the is for inf
Slide 3: Contents
CONTENTS - Introduction - Where, what and how - The London Advantage - December 2020 update - Operating performance - Portfolio update - ESG - UK student accommodation market - Portfolio fundamentals - Conclusion - Appendices STUDENT ScapeScape Bloomsbury,CGI ScapeShoreditch Brighton 3
Slide 4: Introduction
INTRODUCTION GCP Student Living plc (“the Company”) - GCP Student is the only UK REIT focused on modern, purpose-built private student accommodation in and around London - The Company seeks to provide attractive total returns in the longer term - Investments located primarily in and around London, w
Slide 5: Where, What and How
WHERE, WHAT AND HOW THE THREE FUNDAMENTALS WHERE THE ng ASSETS ARE LOCATED Primary focus High supply-side in and around London barriers WHAT THE Vv COMPANY Intelligent design Large-scale assets BUYS to optimise benefiting from long-term returns operating efficiencies Q HOW THE COMPANY OPERATES GCP S
Slide 6: The London Advantage
THE LONDON ADVANTAGE The London student accommodation market Student accommodation supply is underpinned by surplus long term and demand in London 2019/20 demand Supply constrained: 500,000 Land availability & planning tax 450,000 The London Plan 400,000 International Outlook for development of new
Slide 7: December 2020 Update
DECEMBER 2020 UPDATE Stable NAV for the quarter with positive sector outlook Portfolio Quarter FY21 movement movement NAV 171.38p 0.2% 0.2% Valuation £1.03bn 0.2%* 0.2%* - PBSA transactional activity supportive of PBSA valuations - Scape Brighton opened to students from September Income - Bo
Slide 8: Operating Performance - Income Statement
OPERATING PERFORMANCE - INCOME STATEMENT Commentary For period ended 31 December 2020 31 Dec 20 31 Dec 19 £’000 £’000 Rental income 16,949 24,587 Rental income decreased by 31% in the period, due to reduced occupancy as international mobility became Operating expenses (6,248) (5,236) restricted due
Slide 9: Operating Performance - Balance Sheet
OPERATING PERFORMANCE - BALANCE SHEET At 31 December 2020 Commentary 31 Dec 20 30 Jun 20 £’000 £’000 Assets Investment property increased by 2.9% due to capital expenditure on Scape Brighton and Circus St and modest valuation uplifts. Investment property 1,039,040 1,009,838 Cash and cash equivalents
Slide 10: Portfolio update
Portfolio update STUDENT Scape Bloomsbury
Slide 11: Portfolio Overview
PORTFOLIO OVERVIEW At 31 December 2020 80% 2 4 3 1 7 6 5 Property 11 1 Scape Mile End 2 Scape Wembley 3 Scape Shoreditch 4 Scape Bloomsbury 5 Scape Greenwich 6 The Pad, Egham 8 7 Podium, Egham 9 10 8 Scape Guildford 9 Circus Street, Brighton* 10 Scape Brighton Water Lane Apartments, 11 Bristol STUDE
Slide 12: Portfolio Overview
PORTFOLIO OVERVIEW At 31 December 2020 Commercial Year Book % of Property Beds Valuation Location NIY space completed cost portfolio (sqft) Scape Shoreditch 541 2015 £166.8m £209.7m London 20% 4.32% 49,000 Scape Bloomsbury 432 2018 £167.3m £194.7m London 19% 4.00% nil Scape East 588 2012 £94.3m £163
Slide 13: Liquidity
LIQUIDITY The Company is well capitalised At 31 December 2020 the Company: - remained lowly levered, with an LTV of 24% - had cash reserves of c.£44m - had remaining capital commitments of c.£5m across Circus St and Scape Brighton to be funded from equity to use resources efficiently The Company con
Slide 14: Covid-19 - Academic Year 2020/21
COVID-19 - ACADEMIC YEAR 2020/21 Pandemic continues to impact the sector Collected vs budgeted income for AY 2020/21 and portfolio Portfolio has faced operational challenges caused by the pandemic Budget - The Company agreed to a 6-week rent concession for eligible students £60.1m unable to occupy t
Slide 15: ESG
GCP STUDENT ~ Scape Brighton
Slide 16: Gravis Responsible Investment Approach
GRAVIS RESPONSIBLE INVESTMENT APPROACH At Gravis we involve ourselves in long-term projects that offer a human dimension, investing in assets that will be needed by the UK for many years to come - Our long-term approach enables us to engage with investee - Allocating time and resources to adhere to
Slide 17: GCP Student ESG Approach
GCP STUDENT ESG APPROACH GCP Student's ESG policies and credentials The Global Real Estate Sustainability Benchmark provides comparable and reliable data on the ESG performance of investments. Under its 2020 submission the Company achieved: • 2 ‘Green Stars’ on its Real Estate Assessment and a score
Slide 18: UK student accommodation market
UK student accommodation market STUDENT
Slide 19: UCAS Update
UCAS UPDATE January applicant data shows strong growth in students looking to start in September 2021 On 18 February UCAS published their January deadline Growth in student acceptances application statistics for the 2021/22 cycle. 200% Non EU 190% EU (excluding UK) Total undergraduate applications a
Slide 20: Application Trends
APPLICATION TRENDS Accelerated divergence in university Change in student applications by application rates ranking of UK universities (2012-2020) 60% For the 2020/21 UCAS cycle, Higher Tariff providers had a 13% increase in acceptances vs a 1% increase for lower tariff % change from 50% institution
Slide 21: UK Student Investment Market
UK STUDENT INVESTMENT MARKET Portfolio valuations supported by Notable recent transactions transactional activity Estimated Transaction Location Beds Value yield* Background KKR Portfolio National 2,163 £291m 4.75% - Student accommodation is an institutional asset class Scape Canalside Mile End 412
Slide 22: Conclusion
Conclusion STUDENT 22 Scape Shoreditch
Slide 23: Portfolio Fundamentals
PORTFOLIO FUNDAMENTALS The investment manager remains confident of the portfolio’s long-term prospects LONDON WEIGHTING ON CAMPUS STUDIO CENTRIC 80% weighting towards London All assets are either on- Portfolio is 80% weighted campus or are within a 10- towards studios London is a global centre of mi
Slide 24: Conclusion
CONCLUSION The Investment Manager is confident of the long-term prospects of PBSA - Covid-19 lockdown and travel restrictions are impacting the Company and uncertainty remains for the rest of the 20/21 academic year - Focussed on the safety and wellbeing of students and staff - The Company is well p
Slide 25: Contact Information
CONTACT INFORMATION Nick Barker nick.barker@graviscapital.com 020 3405 8521 Joe McDonagh joe.mcdonagh@graviscapital.com 020 3405 8523 Gravis Capital Management Limited 24 Savile Row London, W1S 2ES www.graviscapital.com STUDENT
Slide 26: Appendices
Appendices STUDENT
Slide 27: Investment Objectives
INVESTMENT OBJECTIVES The Company targets attractive total returns in the longer term TOTAL RETURN PORTFOLIO QUALITY DIVERSIFICATION To generate attractive total Focus on modern, private The Company invests and returns in the longer term. student residential manages its assets with the accommodation
Slide 28: Company Highlights – At a Glance
COMPANY HIGHLIGHTS – AT A GLANCE The Company has increased NAV and income since IPO while reducing its cost of debt 220p 7p 6.00% 50% 6.15p 6.15p 210p Ordinary share price 5.95p 6p 5.50p 5.60p 5.66p 5.75p 200p EPRA NAV 5.00% 190p 40% 5p 180p 4.00% 170p 30% 4p 160p 3.00% 150p 3p 20% 140p 130p 2.00% 2
Slide 29: Portfolio Demographics
PORTFOLIO DEMOGRAPHICS The portfolio has a diverse student mix #1 British #1 Royal Holloway #2 Chinese #2 UCL #3 Indian #3 QMUL #4 French #4 Sussex Level of study #5 American #5 Brighton Undergraduate Postgraduate Top five nationalities Top five higher 72% 28% education institutions attended by resi