Charter Hall Long Wale Reit · ASX:CLW
Charter Hall Long Wale Reit — Merger or Acquisition (December 2020)
39 slides from Charter Hall Long Wale Reit's merger presentation, Dec 9, 2020
Slide 1: Acquisitions and equity raising
For personal use only Charter Hall Long WALE REIT Acquisitions and equity raising 9 December 2020 Not for release to US wire services or distribution in the United States 76-78 Pitt Street, Sydney
Slide 2: Important notice
Acquisitions and equity raising Important notice For personal use only Important Notice This presentation ("Presentation") has been prepared by and is the sole responsibility of Charter Hall WALE Limited (ABN 20 610 772 202, Australian Financial Services Licence Number 486721) (“Responsible Entity”)
Slide 3: Important notice (cont.)
Acquisitions and equity raising Important notice (cont.) For personal use only Forward-looking statements This Presentation contains certain “forward-looking statements”, including expectations about the success of the Placement. The words “forecast”, “estimate”, “likely”, “anticipate”, “believe”, “
Slide 4: Agenda
For personal use only 1. Transaction overview 5 Appendix Agenda 2. Acquisitions overview 3. CLW portfolio impact 8 11 A. Pro forma metrics B. Summary of key risks 20 23 Acquisitions and 4. Sources and uses of funds 16 C. International Offer Restrictions 30 equity raising 5. Equity raising overview 1
Slide 5: Transaction overview
Acquisitions and equity raising Transaction overview For personal use only ‒ Charter Hall Long WALE REIT ("CLW") is pleased to announce that it has entered into agreements to acquire the following properties: ‒ A 100% interest in 76-78 Pitt Street, Sydney NSW via a sale and leaseback to Telstra for
Slide 6: Transaction overview (cont.)
Acquisitions and equity raising Transaction overview (cont.) For personal use only ‒ Including the impact of the Acquisitions and Placement, and based on information currently available (including with respect to the COVID-19 pandemic) and barring any unforeseen events, CLW reaffirms guidance previo
Slide 7: Strategic rationale
Acquisitions and equity raising Strategic rationale Well located, strategic long WALE properties with predominant NNN lease terms4 For personal use only 1 2 Strategic properties weighted to core Sydney locations NNN leases with long-term growing income Acquisitions increase the REIT’s NSW exposure
Slide 8: Acquisitions overview – 76-78 Pitt Street, Sydney, NSW
Acquisitions and equity raising Acquisitions overview – 76-78 Pitt Street, Sydney, NSW Prime CBD property with secure, long-term growing income and future optionality For personal use only Property details Property and transaction overview Address 76-78 Pitt Street, Sydney NSW Property type Telco Ex
Slide 9: Acquisitions overview – Bunnings Caboolture, QLD
Acquisitions and equity raising Acquisitions overview – Bunnings Caboolture, QLD New Bunnings development to be leased on an initial 12 year term For personal use only Property details Property and transaction overview Address 459 Pumicestone Road, Caboolture QLD Property type Long WALE Retail ‒ New
Slide 10: Acquisitions overview – The Parap Tavern, Darwin, NT
Acquisitions and equity raising Acquisitions overview – The Parap Tavern, Darwin, NT Recently refurbished Darwin pub with a 15 year, NNN lease to Endeavour Group For personal use only Property details Property and transaction overview Address 15 Parap Road, Darwin NT Property type Long WALE Retail ‒
Slide 11: CLW portfolio impact
Acquisitions and equity raising CLW portfolio impact Australia’s largest and most diversified long WALE REIT For personal use only Pre-Acquisition1 Acquisition Portfolio Post-Acquisition Number of properties 456 3 459 Property valuation $3,908m $319m $4,227m Proportion of NNN leases 50% 91% 53% Weig
Slide 12: Tenant diversification
Acquisitions and equity raising Tenant diversification Expands CLW’s relationships with existing high quality tenants For personal use only Major tenants1 19% 4% 16% 3% 14% 3% 13% 2% 7% 2% 6% 1% 6% 1% 1. Weighted by net passing income (REIT ownership interest) Charter Hall Long WALE REIT 12
Slide 13: Tenant diversification (cont.)
Acquisitions and equity raising Tenant diversification (cont.) High proportion of investment grade tenants For personal use only Independent credit rating - key tenants1 ‒ Brisbane City Council ‒ Arnott's ‒ Inghams ‒ Metcash AAA ‒ Linfox 11% ‒ Coates Hire Not rated AA+ 23% 4% AA- 3% BBB 13% A- 37% B
Slide 14: Tenant resilience
Acquisitions and equity raising Tenant resilience Resilient and defensive sector exposures For personal use only Portfolio income exposure to key defensive tenant industries1,2 Telecommunications (19%) Government (16%) Grocery & distribution (15%) Convenience retail (14%) 242 Exhibition Street, Melb
Slide 15: Lease expiry profile
Acquisitions and equity raising Lease expiry profile Long dated portfolio WALE of 14.2 years For personal use only 14.2 years 21.6% 20.5% 13.9% 13.0% 9.4% 9.4% 7.5% 7.0% 7.1% 7.1% 6.7% 6.3% 5.9% 5.3% 5.0% 4.3% 4.0% 4.2% 3.9% 4.5% 4.2% 3.6% 3.4% 3.7% 3.4% 2.9% 2.7% 1.5% 1.4% 1.5% 0.8% 0.7% 0.7% 0.7%
Slide 16: Sources and uses of funds
Acquisitions and equity raising Sources and uses of funds Acquisitions to be partially funded by a $250 million institutional placement For personal use only ‒ The REIT will undertake a fully underwritten institutional placement of $250 million to partially fund the Acquisitions and associated trans
Slide 17: Equity raising overview
Acquisitions and equity raising Equity raising overview Fully underwritten institutional placement For personal use only Structure ‒ A fully underwritten institutional placement to raise $250 million to partially fund the Acquisitions and associated transaction costs ‒ Fixed issue price of $4.65 per
Slide 18: Timetable
Acquisitions and equity raising Timetable For personal use only Event Date Trading halt and announcement of the Acquisitions and Placement Wednesday, 9 December Placement bookbuild Wednesday, 9 December Trading of securities recommences on the ASX Thursday, 10 December Settlement of new securities i
Slide 19: Conclusion
Acquisitions and equity raising Conclusion For personal use only 76-78 Pitt Street is a unique acquisition of a long WALE, NNN property in the Sydney CBD which provides secure, growing income supported by high underlying land value Bunnings Caboolture and the Parap Tavern are long leased propert
Slide 20: Appendix A
76-78 Pitt Street, Sydney Appendix A For personal use only Charter Hall Long WALE REIT
Slide 21: Reconciliation of portfolio metrics
Appendix A Reconciliation of portfolio metrics For personal use only Change from Dec-20 Jun-20 pro forma adjusted Jun-20 pro forma adjusted Jun-201 Change from Acquisitions revaluations (pre-Acquisitions) (post-Acquisitions) Number of properties 456 - 456 3 459 Property valuation $3,758m $150m $3,90
Slide 22: Pro forma balance sheet
Appendix A Pro forma balance sheet For personal use only Jun-201 Sep-20 DRP and Oct-20 Dec-20 revaluations Acquisitions and Jun-20 pro forma (A$m) SPP proceeds2 Placement adjusted Cash 38.4 - - - 38.4 Investment properties 1,879.2 - 53.1 309.6 2,241.8 Equity accounted investments 1,188.3 - 97.0 9.8
Slide 23: Appendix B
Appendix B For personal use only Charter Hall Long WALE REIT 76-78 Pitt Street, Sydney
Slide 24: Summary of key risks
Appendix B Summary of key risks For personal use only Investors should carefully consider the risk factors described below. Additional risk factors and uncertainties that are not RISKS RELATING TO CLW known to the Responsible Entity, Charter Hall WALE Limited (Responsible Entity) at the time of this
Slide 25: Summary of key risks (cont.)
Appendix B Summary of key risks (cont.) For personal use only Tenants and Rental Income Co-ownership risk Distributions made by the REIT are largely dependent on the rents received from tenants across the The REIT holds a number of interests in its portfolios with its partners through joint co-owner
Slide 26: Summary of key risks (cont.)
Appendix B Summary of key risks (cont.) For personal use only As property values fluctuate, so too may returns from property assets. Rental and occupancy levels may Management performance change as a result of changes in the property market and this may affect the distributions paid by the REIT The
Slide 27: Summary of key risks (cont.)
Appendix B Summary of key risks (cont.) For personal use only This may create a conflict of interest. Related party transactions also carry a risk that they could be the REIT's portfolio, which may be exacerbated by the impact of COVID-19. In the event that an event of assessed and monitored less ri
Slide 28: Summary of key risks (cont.)
Appendix B Summary of key risks (cont.) For personal use only Insolvency Occupational health and safety In the event of any liquidation or winding up of the REIT, the claims of the REIT's creditors, including any There is a risk that liability arising from occupational health and safety matters at a
Slide 29: Summary of key risks (cont.)
Appendix B Summary of key risks (cont.) For personal use only standards could materially adversely affect the financial performance and position reported in the REIT's Macro-economic financial statements. Changes in the general economic outlook both in Australia and globally may impact the performan
Slide 30: Appendix C
76-78 Pitt Street, Sydney Appendix C For personal use only Charter Hall Long WALE REIT
Slide 31: International Offer Restrictions
Appendix C International Offer Restrictions For personal use only This document does not constitute an offer of new stapled securities ("New Securities") of CLW in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Securitie
Slide 32: International Offer Restrictions (cont.)
Appendix C International Offer Restrictions (cont.) For personal use only United Kingdom Neither this document nor any other document relating to the offer has been delivered for approval to the Financial Conduct Authority in the United Kingdom and no prospectus (within the meaning of section 85 of
Slide 33: Appendix D
76-78 Pitt Street, Sydney Appendix D For personal use only Charter Hall Long WALE REIT
Slide 34: Underwriting arrangement
Appendix D Underwriting arrangement For personal use only J.P. Morgan Securities Australia Limited, Morgan Stanley Australia Securities Limited and UBS AG, Australia Branch will be acting as joint bookrunners, joint lead managers and several underwriters of the Placement (Underwriters). The Responsi
Slide 35: Underwriting arrangement (cont.)
Appendix D Underwriting arrangement (cont.) For personal use only • any statement in a certificate to be provided under the Underwriting Agreement is false, misleading or deceptive; • any information supplied by or on behalf of CLW to the Underwriters in final form is or becomes misleading or decept
Slide 36: Appendix E
The Parap Tavern, Darwin Appendix E For personal use only Charter Hall Long WALE REIT
Slide 37: Glossary
Appendix E Glossary For personal use only ASX Australian Securities Exchange Calculated as the ratio of net drawn debt (excluding unamortised debt establishment costs) to total tangible assets, Balance sheet gearing less cash The return of a property or portfolio of properties calculated by dividing
Slide 38: Contact information
Appendix E Contact information For personal use only Avi Anger Scott Martin Darryl Chua Philip Cheetham Fund Manager Head of Finance Deputy Fund Manager Head of Listed Investor Relations Charter Hall Long WALE REIT Charter Hall Long WALE REIT Charter Hall Long WALE REIT Charter Hall Group Charter Ha
Slide 39: For personal use only
For personal use only Sydney Head Office Melbourne Brisbane Perth Adelaide Level 20, No.1 Martin Place Level 14, 570 Bourke Street Level 3, The Annex Level 5, St Georges Square Level 2, 80 Pirie Street Sydney, NSW, 2000 Melbourne VIC 3000 275 George Street 225 St Georges Terrace Adelaide SA 5000 Bri
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