Emira Property Fund Ltd. · JSE:EMI
Emira Property Fund — H1 2019 Earnings Presentation
99 slides from Emira Property Fund's earnings presentation, Feb 14, 2019
Slide 1: Interim Results Presentation
EMIRA PROPERTY FUND INTERIM RESULTS PRESENTATION 14 FEBRUARY 2019
Slide 2: Agenda
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 1 AGENDA OVERVIEW FINANCIALS PORTFOLIO INVESTMENT › Reflections 2018 › Distribution statement › Directly held SA › Residential › Key metrics › Balance sheet portfolio performance › Enyuka › 5-year track record › Funding › Disposals ›
Slide 3: Emira Property Fund
EMIRA PROPERTY FUND
Slide 4: Reflections 2018
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 3 REFLECTIONS 2018 › Reduction of › Increased offshore › Bolton in Rosebank › Portfolio in office portfolio › US co-investments › 34.9% stake in good shape › <25% of total assets › 6 assets Transcend Residential › 80 assets › 44-20 b
Slide 5: Key metrics at December 2018
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 4 KEY METRICS AT DECEMBER 2018 DISTRIBUTIONS NAV TENANT PER SHARE PER SHARE VACANCIES RETENTION +3.1% +1.5% to 1 783 3.7% 88% ACQUISITIONS DISPOSALS CAPEX PROJECTS LTV USD18.3m R1.8bn offices R224m 41%/37% TRANSCEND 34.9%
Slide 6: 5-year track record
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 5 5-YEAR TRACK RECORD 2 000 74 150 1 800 145 72 1 600 1 801 1 751 1 759 1 735 1 761 1 735 1 783 1 747 1 400 1 650 1 732 1 698 140 70 1 200 1 470 1 511 1 621 1 386 1 346 1 434 1 480 135 1 358 1 429 68 1 000 130 800 66 125 600 64 120 4
Slide 7: Emira Property Fund
” GREG BO CF Yo EMIRA PROPERTY FUND
Slide 8: Distribution statement
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 7 DISTRIBUTION STATEMENT R’000 DEC 17 DEC 18 % CH Revenue 840 678 869 863 3.5 Property expenses (303 743) (324 684) 6.9 Net direct property income 536 935 545 179 1.5 Gross property expenses to revenue ratio (%) 36.1 37.3 Net propert
Slide 9: Distribution statement continued
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 8 DISTRIBUTION STATEMENT continued R’000 DEC 17 DEC 18 % CH Net operating income b/f 490 023 487 580 (0.5) Income from investments Enyuka 35 985 37 542 4.3 Growthpoint Australia (GOZ) 29 491 27 123 (8.0) USA 2 740 27 449 >100.0 Trans
Slide 10: Distribution per share (cents)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 9 DISTRIBUTION PER SHARE (cents) 1.3 6.4 (1.8) 0.4 (4.2) 4.7 1.2 80 0.6 0.4 3.1 (1.0) (0.8) (1.2) 72.86 3.3 0.4 (1.0) (0.2) 70.65 (1.8) 70 (0.5) (2.6) (2.4) 60 Sold properties Transcend Dec 17 Enyuka AUD interest Dec 18 GOZ Net ZAR f
Slide 11: Balance sheet
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 10 BALANCE SHEET R’000 DEC 17 DEC 18 % CH Investment properties 12 727 12 710 (0.1) Investments Enyuka 614 659 7.7 GOZ 941 918 (2.4) USA 100 760 660.0 Transcend – 528 >100.0 Other assets 531 527 (1.1) Total assets 14 913 16 102 8.0 I
Slide 12: LTV analysis post office portfolio disposal
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 11 LTV ANALYSIS POST OFFICE PORTFOLIO DISPOSAL 31-DEC-18 31 Dec 18 30 Jun 19 Disposal 13 000 Transaction Income producing assets Investment properties sold R1,8bn 8 000 Loan + equity provided R340,0m 3 000 Cash into debt R1,5bn (2 00
Slide 13: 1.5% increase in NAV per share
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 12 NET ASSET VALUE PER SHARE (cents) 1 800 8 17 1 1 783 (2) 6 3 (3) 1 758 73 1 750 76 (5) 1 700 1 710 1 681 1 650 Jun 18 Investment GOZ Enyuka Transcend USA Foreign Revaluation Change in Dec 18 properties investments exchange of deri
Slide 14: Debt funding mix (Rm)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 13 DEBT FUNDING MIX (Rm) LONG TERM RENEWALS CONCLUDED 700 TO BE SETTLED POST 31 DEC 18 FINALISING RENEWAL TERMS 600 UNDRAWN AVAILABLE DEBT 500 400 R'm 300 200 100 - FEB MAR MAR MAR APR MAY SEP SEP SEP SEP NOV NOV NOV MAR JUN SEP NOV
Slide 15: Interest rate swap profile
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 14 INTEREST RATE SWAP PROFILE 1 200 1 000 800 600 400 200 - JUN 19 DEC 19 JUN 20 DEC 20 JUN 21 DEC 21 JUN 22 DEC 22 JUN 23 JUN 24 DEC 24 Hedged debt Weighted average Weighted average 71.8% duration to expiry all in interest rate (90%
Slide 16: Directly held SA portfolio performance
= = a : Sar DIRECTLY HELD SA PORTFOLIO PERFORMANCE Grill & Skybar ULANA vAN ‘BILJON C00 PROPERTY FUND
Slide 17: Directly held SA property portfolio summary
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 16 DIRECTLY HELD SA PROPERTY PORTFOLIO SUMMARY NUMBER OF PROPERTIES 200 150 150 146 141 148 146 142 100 111 104 50 0 DEC 11 DEC 12 DEC 13 DEC 14 DEC 15 DEC 16 DEC 17 DEC 18 NUMBER OF PROPERTIES PER SECTOR – 2017 VS 2018 50 40 46 44 4
Slide 18: Directly held SA property portfolio summary
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 17 DIRECTLY HELD SA PROPERTY PORTFOLIO SUMMARY 2017 VALUE SPLIT PER SECTOR (%) R12.7bn 2018 VALUE SPLIT PER SECTOR (%) R12.7bn (excl. The Bolton) (incl. The Bolton) 41% OFFICES 42% URBAN RETAIL 15% INDUSTRIAL 15% RESIDENTIAL 44% 41%
Slide 19: Directly held SA property portfolio summary
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 18 DIRECTLY HELD SA PROPERTY PORTFOLIO SUMMARY AVERAGE VALUE PER m² +7% R/m² 2% 20 000 16 541 16 304 16 518 15 801 15 000 12 370 12 582 10 000 5 362 5 553 5 000 0 OFFICE URBAN RETAIL INDUSTRIAL TOTAL DEC 17 DEC 18 AVERAGE VALUE PER P
Slide 20: Office sector exposure – quality improvement
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 19 OFFICE SECTOR EXPOSURE – QUALITY IMPROVEMENT NUMBER OF PROPERTIES AVERAGE VALUE PER PROPERTY (Rm) 44 2011 52 2018 73 118 GRADE OF OFFICE PORTFOLIO BY VALUE (%) 2011 GRADE OF OFFICE PORTFOLIO BY VALUE (%) 2018 P-GRADE 49% 61% A-GRA
Slide 21: Portfolio after the office portfolio disposal
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 20 DIRECTLY HELD SA PROPERTY PORTFOLIO AFTER THE OFFICE PORTFOLIO DISPOSAL BEFORE AFTER (31 DEC 18) Number of total properties 104 80 Number of office properties 44 20 Average value per property (portfolio) R120m R133m Average value
Slide 22: Portfolio after the office portfolio disposal
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 21 DIRECTLY HELD PROPERTY PORTFOLIO AFTER THE OFFICE PORTFOLIO DISPOSAL 2018 VALUE SPLIT PER SECTOR (%) R10.8bn 2018 GLA SPLIT PER SECTOR (%) 0.8m m² (incl. The Bolton) (excl. The Bolton) 49% 39% OFFICES URBAN RETAIL 18% INDUSTRIAL 1
Slide 23: Vacancy profile by GLA (%)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 22 VACANCY PROFILE BY GLA (%) 18% 16.1% 16% 14% 12% 9.4% 10% 8% 7.0% 5.6% 6% 4.5% 3.1% 3.7% 3.7% 4% 2.2% 2.0% 2.1% 2% 1.2% 0% OFFICE URBAN RETAIL INDUSTRIAL TOTAL (SAPOA 11.1%) (SAPOA 4.4%) (SAPOA 3.3%) December 2018 September 2018 J
Slide 24: Tenant retention
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 23 TENANT RETENTION (%) 100% 80% 88% 85% 75% 77% 79% 60% 73% 71% 70% 66% 40% 20% 0% GROSS RENTALS m² NO. OF LEASES DEC 16 DEC 17 DEC 18 Expiries of 190 414m² equals 258 leases or R16.8m gross rentals per month
Slide 25: Major lease expiries by gross rental: 1H19
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 24 10 MAJOR LEASE EXPIRIES BY GROSS RENTAL: 1H19 PROPERTY TENANT LEASE END GLA (m²) STATUS RTT ACSA Park RTT Group Dec 18 46 673 Renewed – 6 years Trans Caledon Tunnel Tuinhof * Dec 18 3 757 Renewed – 3 years Authority Trellidor Trel
Slide 26: Lease expiry profile by gross rental (%)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 25 LEASE EXPIRY PROFILE BY GROSS RENTAL (%) 60% Hundreds 48.9 50% 45.1 40.6 40% 30% 23.7 23.9 22.5 23.4 20% 18.0 16.7 10.8 10.1 11.2 10% 1.0 0.4 0.3 1.5 0.5 1.5 0.0 0.0 0.0 0% VACANCY VACATED EXPIRIES ROLLED YEAR 1 YEAR 2 YEAR 3 YEAR
Slide 27: Reversions – total (gross rentals)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 26 REVERSIONS – TOTAL (GROSS RENTALS) AVG. AVG. NEW INCREASE/ SECTOR AREA EXPIRY RENTAL LEASE RENTAL (DECREASE) % Office 26 965 151.47 145.62 -3.9 Urban retail 21 136 160.76 162.76 1.2 Industrial 107 030 57.43 56.76 -1.2 Total Dec 18
Slide 28: Year-on-year like-for-like growth in net income
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 27 YEAR-ON-YEAR LIKE-FOR-LIKE GROWTH IN NET INCOME (static portfolio) 12% 9.7% 10% 7.9% 7.9% 7.8% 8% 6.1% 6% 3.8% 4% 2% 0% -2% GROSS INCOME EXPENSES NET INCOME DEC 17 DEC 18 GROSS INCOME EXPENSES Contractual escalations and filling o
Slide 29: Retail trading statistics
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 28 RETAIL TRADING STATISTICS Trading density growth Foot count growth Spend per head growth +1.4% -1.1% +3.1% › Black Friday sales are cannibalising December sales › Trading conditions and environment remain difficult with pressure o
Slide 30: Major lease expiries by gross rental: 2H19
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 29 10 MAJOR LEASE EXPIRIES BY GROSS RENTAL: 2H19 PROPERTY TENANT LEASE END GLA (m²) STATUS 7 Naivasha Road * Group M Ap 19 4 673 Expecting to vacate Expecting to renew – Corporate Park 66 * PSG Wealth Jun 19 3 161 3 years Finalising
Slide 31: In conclusion
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 30 IN CONCLUSION Solid portfolio results despite challenging local economy, political uncertainties and property fundamentals under pressure
Slide 32: Emira Property Fund
EMIRA PROPERTY FUND
Slide 33: Rosebank residential to rent – The Bolton
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 32 ROSEBANK RESIDENTIAL TO RENT – THE BOLTON › 282 units, focus on LSM 7 – 8 › Final completion end of May 2019 › 203 units completed › Total value on completion R207m › 65% let on completed units (of which R194m spent) › Yield >10.5
Slide 34: Transcend – Residential
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 33 TRANSCEND – RESIDENTIAL Acquisition of 34.9% stake Portfolio of 21 residential properties, in Transcend Residential Fund 4 691 units › Cost price R300m › Lower LSM, value properties › Mezzanine loan R143m at 10.5% interest › IHS m
Slide 35: Enyuka
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 34 ENYUKA 15 original assets 7 new assets Additional acquisitions R653m acquired R444m in pipeline
Slide 36: Enyuka – lower LSM retail
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 35 ENYUKA – LOWER LSM RETAIL VACANCY 2.8% LFL GROWTH 6.2% WALE 2.8 YEARS (DEC 17 – 3.8%)
Slide 37: Disposals
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 36 DISPOSALS No assets transferred Office Portfolio Disposal Sale agreements concluded in 1H19 › R1.8bn (25 assets) › Cresta Corner (R94m) › R818m (11 assets) transferred › Umgeni B (R25.5m) to date › Retain a R320m 5 year mezz loan
Slide 38: Other
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 37 OTHER › Sale of 2.0m GOZ shares at AUD3.80 (ave cost AUD1.97) › Balance of 24m GOZ shares remain (3.3% of shares in issue)
Slide 39: Rebalancing (%) – total assets
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 38 REBALANCING (%) – TOTAL ASSETS JUN 18 DEC 18 DEC 18 POST OFFICE DISPOSAL GOZ 6.5 5.9 6.7 9.6% 10.8% 12.2% US 3.1 4.9 5.5 OFFICE 35.3 33.7 24.7 URBAN RETAIL 36.2 34.5 39.1 INDUSTRIAL 13.1 86.0% 12.5 85.0% 14.2 83.0% RESIDENTIAL 1.1
Slide 40: Offshore: USA investment strategy
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 39 OFFSHORE USA INVESTMENT STRATEGY
Slide 41: Offshore investment
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 40 OFFSHORE INVESTMENT FY17 FY18 FY19 Pre USA Post USA Diversification of assets 0.6% DPS improvement Better ZAR returns, and tenant income in FY18 locked-in growth rates 2.8% DPS improvement in 1H19
Slide 42: Total US retail sales remain healthy
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 41 TOTAL US RETAIL SALES REMAIN HEALTHY Total retail sales increased 6.1% y-o-y Core retail sales increased by 50bps in Q3, the largest gains since 2012 in Q3 and are up 5.5%, driven by food services and non-store retailers
Slide 43: Supply/demand equation of retail space remains compelling
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 42 SUPPLY/DEMAND EQUATION OF RETAIL SPACE REMAINS COMPELLING Total retail completions continued to decline in Q3, driving up rent and demand for prime assets
Slide 44: Emira co-investment with Rainier
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 43 EMIRA CO-INVESTMENT WITH RAINIER › 40 – 49% equity investment, co-invested › Deal-by-deal basis › Unanimous decisions › Partner with similar logic › Dallas, Texas based › USD1.2bn of assets › 18 professional staff under management
Slide 45: Emira/Rainier investment thesis
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 44 EMIRA/RAINIER INVESTMENT THESIS › Class A+ open air retail power centers › Generally above USD25 000 000 › Must have grocery component › Secondary and tertiary markets › Top quartile asset in market or sub-market » Value offering
Slide 46: US geographical exposure
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 45 US GEOGRAPHICAL EXPOSURE Ohio Nebraska Indiana Virginia Missouri Oklahoma Alabama Dallas Key: Texas States with owned assets Florida Owned asset location Pipeline asset location Rainier / Continuum HQ
Slide 47: Woodlands Square – Tampa, Florida
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 46 WOODLANDS SQUARE – TAMPA, FLORIDA (26 OCT 2018) PURCHASE GLA OCCUPANCY EMIRA EQUITY CASH PRICE INVESTMENT YIELD USD64.0m 314 699ft2 96.16% USD12.20m USD 11.82% YIELD SITE EXTENT WALE (49.57% equity 7.82% 1 232 312ft2 8.34 years st
Slide 48: Truman's Marketplace – Grandview, Missouri
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 48 TRUMAN’S MARKETPLACE – GRANDVIEW, MISSOURI (24 DEC 2018) PURCHASE GLA OCCUPANCY EMIRA EQUITY CASH PRICE INVESTMENT YIELD USD30.7m 308 209ft2 98.54% USD6.1m USD 11.12% YIELD SITE EXTENT WALE (49.51% equity 8.79% 1 683 594ft2 7.45 y
Slide 49: US portfolio at a glance
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 50 US PORTFOLIO AT A GLANCE Belden Crossing 32 East Moore Plaza Stony Creek Woodlands Square Truman’s Marketplace Number of Property Average Emira total properties portfolio value value per ft² equity investment 6 USD294.2m USD156.45
Slide 50: US portfolio at a glance
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 51 US PORTFOLIO AT A GLANCE Belden Crossing 32 East Moore Plaza Stony Creek Woodlands Square Truman’s Marketplace Vacancy Weighted average Weighted average GLA by GLA lease expiry annual rental per ft² 1 880 439ft2 3.43% 5.80 years U
Slide 51: FY19 strategic allocations
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 52 FY19 STRATEGIC ALLOCATIONS OFFICES OFFSHORE RESIDENTIAL › Office portfolio disposal › USD50m invested to date › Transcend stake executed completed (to 5.5%) › June 20 target of 5 – 10% › Further USD20m by June 19 of total assets (
Slide 52: FY19 outlook
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 53 FY19 OUTLOOK › DPS growth of 3.1% for 1H19 » Similar growth for 2H19 › Continuing to do the basics well › Solidifying the base for growing distributions
Slide 53: Thank you
EMIRA PROPERTY FUND THANK YOU
Slide 54: Annexures
EMIRA PROPERTY FUND ANNEXURES
Slide 55: Debt mix analysis
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 56 DEBT MIX ANALYSIS CURRENCY ZAR AUD USD TOTAL Income producing assets 14 017 918 760 15 696 Total facilities (Rm) 6 866 – – 6 866 Reclassified as foreign debt through CCIRS (Rm) (1 611) 893 719 – Adjusted total facilities (Rm) 5 25
Slide 56: Debt covenants
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 57 DEBT COVENANTS TRANSACTION TRANSACTION TRANSACTION CORPORATE CORPORATE CORPORATE CORPORATE VALUE OF FACILITY FACILITY LTV LTV LTV LTV LTV ICR ICR PROPERTIES AVAILABLE DRAWN COVENANT ACTUAL ACTUAL COVENANT ACTUAL* COVENANT ACTUAL (
Slide 57: Foreign income: weighted average hedged rate
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 58 FOREIGN INCOME: WEIGHTED AVERAGE HEDGED RATE PER REPORTING PERIOD GOZ USA Forward rate against ZAR: AUD USD Jun 19 R11.14 R13.96 Dec 19 R11.34 R14.21 Jun 20 R11.64 R14.74 Dec 20 R11.33 R15.11 Jun 21 R11.85 R15.45 Dec 21 – R15.83 J
Slide 58: Cost-to-income ratio (%)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 59 COST-TO-INCOME RATIO (%) 40% 37.9% 37.3% 35% 36.1% 30% 25% 20% 20.4% 17.9% 15% 17.1% 10% 5% 0% GROSS NET DEC 16 DEC 17 DEC 18
Slide 59: Property expense analysis (%)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 60 PROPERTY EXPENSE ANALYSIS (%) MUNICIPAL CHARGES 67 71 SECURITY EXPENSES 8 8 SERVICE CONTRACTS 6 6 RENT AND LEVIES PAID 4 4 MAINTENANCE 4 4 BAD DEBTS 3 2 LEASING EXPENSES 4 3 STAFF EXPENSES 1 1 MARKETING EXPENSES 1 1 CONSUMABLES 1
Slide 60: Valuation parameters
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 61 VALUATION PARAMETERS DEC 2017 DEC 2018 Direct property portfolio Valuation (Rm) * 12 727 12 710 % of the portfolio valued externally 0% 0% Average value per property (Rm) ** 113 120 Average discount rate (%) *** 14.3 14.1 Average
Slide 61: Geographic spread by no. of buildings
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 62 GEOGRAPHIC SPREAD BY NO. OF BUILDINGS: 2017 vs 2018 60 50 45 44 40 38 30 24 23 20 20 18 17 17 16 12 11 10 3 3 1 1 1 1 0 JOHANNESBURG PRETORIA WESTERN CAPE KWAZULU-NATAL BLOEMFONTEIN MPUMALANGA DEC 17 DEC 18 DEC 18 EXCLUDING OFFICE
Slide 62: Geographic spread by value
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 63 GEOGRAPHIC SPREAD BY VALUE GEOGRAPHICAL SPREAD BY VALUE (%) 2017 GEOGRAPHICAL SPREAD BY VALUE (%) 2018 22 21 2 JOHANNESBURG 8 11 29 PRETORIA 34 13 WESTERN CAPE 13 EASTERN CAPE KWAZULU-NATAL BLOEMFONTEIN MPUMALANGA 42 41 GEOGRAPHIC
Slide 63: Geographic spread by GLA
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 64 GEOGRAPHIC SPREAD BY GLA GEOGRAPHICAL SPREAD BY GLA (%) 2017 GEOGRAPHICAL SPREAD BY GLA (%) 2018 3 1 31 JOHANNESBURG 9 3 14 PRETORIA 38 WESTERN CAPE 42 14 EASTERN CAPE 14 KWAZULU-NATAL BLOEMFONTEIN MPUMALANGA 27 31 GEOGRAPHICAL SP
Slide 64: Focus on A- and P-grade properties
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 65 OFFICE SECTOR EXPOSURE OF TOTAL PORTFOLIO – BY VALUE (%) 35 40 30 36 30 35 30 25 30 25 20 20 17 15 15 10 10 5 5 2 5 0 0 2011 2018 2018 EXCLUDING 2011 2018 2018 EXCLUDING OFFICE PORTFOLIO OFFICE PORTFOLIO DISPOSAL DISPOSAL B-GRADE
Slide 65: Vacancy profile by sector and grade – by GLA
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 66 VACANCY PROFILE BY SECTOR AND GRADE – BY GLA (%) 18% Hundreds 16.0 16% 14% 12% 11.2 11.2 10.5 10% 8% 7.3 7.0 6% 5.4 4.4 3.9 3.7 3.7 3.7 4% 2.7 3.0 2.4 1.8 2.0 2.0 2.0 2% 1.1 0% PRIME + OFFICE A OFFICE B URBAN RETAIL INDUSTRIAL TOT
Slide 66: Vacancy loss by gross rental (%)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 67 VACANCY LOSS BY GROSS RENTAL (%) 16% Hundreds 14.3 14% 12% 10.2 10% 8% 7.3 6% 5.4 4.9 4% 3.2 3.2 3.4 2.9 2.4 2.5 2.0 2.0 2.0 1.8 2% 1.1 0% OFFICE URBAN RETAIL INDUSTRIAL TOTAL DEC 16 DEC 17 DEC 18 DEC 18 EXCLUDING OFFICE PORTFOLIO
Slide 67: Vacancy loss by sector and grade
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 68 VACANCY LOSS BY SECTOR AND GRADE – BY GROSS RENTAL (%) 18% 16.4 16% 15.5 14% 12% 10.4 9.9 10% 8.0 8% 7.0 6% 4.5 3.8 4% 3.1 3.2 3.2 3.4 2.9 2.4 2.2 2.0 2.0 2.5 2.1 2% 1.2 0% PRIME + OFFICE A OFFICE B URBAN RETAIL INDUSTRIAL TOTAL D
Slide 68: 10 major lease expiries by GLA: 1H19
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 69 10 MAJOR LEASE EXPIRIES BY GLA: 1H19 PROPERTY TENANT LEASE END GLA (m²) STATUS RTT ACSA Park RTT Group Dec 18 46 673 Renewed – 6 years Defy Defy Appliances Sep 18 9 729 Tenant vacated Trellidor Trellidor Sep 18 7 794 Renewed – 3 y
Slide 69: 10 major lease expiries by GLA: 2H19
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 70 10 MAJOR LEASE EXPIRIES BY GLA: 2H19 PROPERTY TENANT LEASE END GLA (m²) STATUS Finalising lease terms – 14-16 Boston Circle Bidvest Data Jun 19 7 533 3 years 7 Naivasha Road * Group M Apr 19 4 673 Expecting to vacate Steelpark Ind
Slide 70: Lease expiry profile by GLA (%)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 71 LEASE EXPIRY PROFILE BY GLA (%) 60% Hundreds 50% 47.8 44.2 40% 37.4 30% 22.4 23.9 21.8 19.6 20% 17.3 15.3 10.7 9.3 10.4 10% 7.1 4.5 4.7 0.6 0.4 0.3 0.7 0.3 1.3 0% VACANCY VACATED EXPIRIES ROLLED YEAR 1 YEAR 2 YEAR 3 YEAR 4+ (31/12
Slide 71: Lease expiry profile – offices by GLA
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 72 LEASE EXPIRY PROFILE – OFFICES BY GLA (%) 45% Hundreds 39.8 40% 35.2 35% 29.3 30% 24.9 25% 23.1 20.5 20% 19.0 17.5 17.0 16.1 15.8 15% 13.8 9.4 9.5 10% 5.6 5% 1.4 0.9 0.9 0.0 0.3 0.1 0% VACANCY VACATED EXPIRIES YEAR 1 YEAR 2 YEAR 3
Slide 72: Lease expiry profile – urban retail by GLA
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 73 LEASE EXPIRY PROFILE – URBAN RETAIL BY GLA (%) 70% Hundreds 60% 57.4 57.7 58.4 50% 40% 30% 20% 16.3 15.0 17.0 15.9 13.7 13.1 11.4 10% 3.9 5.2 5.0 3.1 2.2 2.0 0.5 0.0 0.0 1.7 0.6 0% VACANCY VACATED EXPIRIES YEAR 1 YEAR 2 YEAR 3 YEA
Slide 73: Lease expiry profile – industrial by GLA
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 74 LEASE EXPIRY PROFILE – INDUSTRIAL BY GLA (%) 50% Hundreds 46.2 45% 39.1 40% 36.9 35% 30% 28.6 27.4 25% 23.5 21.7 20.5 20% 15.7 15% 12.4 10.5 10% 7.2 6.4 5% 1.2 2.1 0.4 0.0 0.0 0.0 0.1 0.0 0% VACANCY VACATED EXPIRIES YEAR 1 YEAR 2
Slide 74: Lease expiry profile – offices by gross rental
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 75 LEASE EXPIRY PROFILE – OFFICES BY GROSS RENTAL (%) 50% Hundreds 44.5 45% 39.7 40% 35% 31.5 30% 26.7 27.5 27.0 24.4 25% 20% 15.8 16.1 16.2 16.5 15% 10.2 10% 5% 1.7 0.9 0.8 0.0 0.0 0.0 0.0 0.3 0.2 0% VACANCY VACATED EXPIRIES YEAR 1
Slide 75: Lease expiry profile – urban retail by gross rental
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 76 LEASE EXPIRY PROFILE – URBAN RETAIL BY GROSS RENTAL (%) 60% Hundreds 55.0 53.5 52.6 50% 40% 30% 19.5 20% 17.9 17.1 18.2 17.0 17.6 10.9 10% 6.1 6.3 3.3 3.4 0.0 0.0 0.0 0.7 0.1 0.0 0.9 0% VACANCY VACATED EXPIRIES YEAR 1 YEAR 2 YEAR
Slide 76: Lease expiry profile – industrial by gross rental
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 77 LEASE EXPIRY PROFILE – INDUSTRIAL BY GROSS RENTAL (%) 50% 47.3 Hundreds 45% 39.7 40% 38.7 35% 29.5 30% 27.1 24.6 25.1 25% 21.4 20% 14.7 15% 11.4 11.8 10% 8.2 5% 0.0 0.0 0.0 0.0 0.2 0.0 0.2 0.0 0.0 0% VACANCY VACATED EXPIRIES YEAR
Slide 77: Reversions renewals (gross rentals)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 78 REVERSIONS RENEWALS (GROSS RENTALS) AVG. AVG. NEW INCREASE/ SECTOR AREA EXPIRY RENTAL LEASE RENTAL DECREASE % Office 21 360 153.98 148.78 -3.4 Urban retail 19 806 166.13 168.43 1.4 Industrial 97 532 57.82 56.80 -1.8 Total Dec 18 1
Slide 78: Reversions new leases (gross rentals)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 79 REVERSIONS NEW LEASES (GROSS RENTALS) AVG. AVG. NEW INCREASE/ SECTOR AREA EXPIRY RENTAL LEASE RENTAL DECREASE % Office 5 605 142.05 133.61 -5.9 Urban retail 1 330 80.69 78.68 -2.5 Industrial 9 498 53.55 56.27 5.1 Total Dec 18 16 4
Slide 79: Properties excluded from like-for-like
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 80 PROPERTIES EXCLUDED FROM LIKE-FOR-LIKE The following are excluded from December FY19 numbers: Purchases › 1 West land, Quagga land Disposals › Brandwag & Kosmos flats, 1289 Heuwel Avenue, 284 Oak Avenue, Southern Life Plaza, Cochr
Slide 80: Leases concluded: Emira portfolio FY19
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 81 LEASES CONCLUDED: EMIRA PORTFOLIO FY19 NEW RENEWAL TOTAL Number of leases 90 219 309 Total m² 25 472 145 378 170 850 Average duration (years) 3.3 2.7 2.9 Lease value (Rm) 154.61 701.97 856.58 The weighted average duration for the
Slide 81: Escalations (%)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 82 ESCALATIONS (%) 8.2% Hundreds 8.0 8.0% 7.9 7.9 7.8% 7.7 7.7 7.6 7.6 7.6 7.6% 7.5 7.4 7.4 7.4% 7.3 7.2% 7.0% 6.8% OFFICE URBAN RETAIL INDUSTRIAL TOTAL DEC 16 DEC 17 DEC 18
Slide 82: Emira net rentals
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 83 EMIRA NET RENTALS (excl. parking stores and vacancies) NO. OF OCCUPIED AVG. NET RENTAL SECTOR BUILDINGS GLA (m²) (R/m²) Office: P-Grade 5 72 162 168.87 Office: A-Grade 29 165 487 135.17 Office: B-Grade 10 58 578 108.18 Urban retai
Slide 83: 10 major lease expiries by GLA: FY20
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 84 10 MAJOR LEASE EXPIRIES BY GLA: FY20 PROPERTY TENANT LEASE END GLA (m²) STATUS Little Green Isando (20 Anvil Road) Sep 19 12 250 Expecting to renew Beverages Epping Warehouse Transpaco Aug 19 5 480 Expecting to renew (WGA) Steiner
Slide 84: 10 major lease expiries by gross rental: FY20
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 85 10 MAJOR LEASE EXPIRIES BY GROSS RENTAL: FY20 PROPERTY TENANT LEASE END GLA (m²) STATUS Little Green Isando (20 Anvil Road) Sep 19 12 250 Expecting to renew Beverages Professional Boundary Terraces Dec 19 2 748 Expecting to renew
Slide 85: Tenant grading – by GLA (%)
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 86 TENANT GRADING – BY GLA (%) TOTAL PORTFOLIO (%) PER SECTOR (%) 80% 71 Hundreds 18 70% 59 60% 53 52 50% 40% A B C 29 30% 27 23 59 21 17 18 23 18 20% 12 10% 0% OFFICE URBAN RETAIL INDUSTRIAL TOTAL GRADING “A” Large national tenants,
Slide 86: Tenant exposure by GLA
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 87 TENANT EXPOSURE BY GLA TOP 10 TENANTS OF THE TOTAL PORTFOLIO (%) TENANT EXPOSURE – TOP TEN TENANTS (%) RTT GROUP 6.0 PICK N PAY 4.7 MASSMART 2.7 SHOPRITE CHECKERS 1.8 23 77 PEPKOR 1.6 WOOLWORTHS 1.4 DEVLAND 1.4 DEPT OF PUBLIC WORK
Slide 87: Tenant exposure by gross rental
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 88 TENANT EXPOSURE BY GROSS RENTAL TOP 10 TENANTS OF THE TOTAL PORTFOLIO (%) TENANT EXPOSURE – TOP 10 TENANTS (%) MASSMART 3.7 PICK N PAY 3.4 RTT GROUP 3.1 PEPKOR 2.2 KING PRICE INSURANCE 1.9 21 79 SA LOCAL GOVERNMENT 1.6 SHOPRITE CH
Slide 88: Directly held SA property portfolio – Edcon exposure
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 89 DIRECTLY HELD SA PROPERTY PORTFOLIO – EDCON EXPOSURE › 1.1% of gross rental * › 0.9% of total GLA › 10 leases » 4 CNA leases » 5 Jet leases » 1 Edgars lease › Cancelled Edgars lease in Market Square and re-let to Clicks › Nonrenew
Slide 89: Potential new capex projects – not committed
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 90 POTENTIAL NEW CAPEX PROJECTS – NOT COMMITTED MAJOR PROJECTS VALUE CONSTRUCTION BEING CONSIDERED TYPE m² (R) TIME Ben Fleur – PV project PV n/a 8 893 762 2 months Corobay Corner – External painting Office 13 610 2 000 000 2 months
Slide 90: Sustainability planning
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 91 SUSTAINABILITY PLANNING CLEAN ENERGY PRODUCTION WATER EFFICIENCY ENVIRONMENTAL › The portfolio has 3 complete › Water harvesting and efficiency continues › Emira has partnered with the WWF solar PV farm projects: to be the focus o
Slide 91: Disposals – last 12 months
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 92 DISPOSALS – LAST 12 MONTHS BOOK SALE EXIT GLA VALUE PRICE YIELD EFFECTIVE PROPERTY LOCATION SECTOR (m2) (Rm) (Rm) (%) DATE Brooklyn Office Park Pretoria Office 5 186 46.8 46.8 8.5 Mar 18 The Pinnacle Cape Town Office 11 867 132.4
Slide 92: Top ten properties by value
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 93 TOP TEN PROPERTIES BY VALUE PROPERTY NODE CLASSIFICATION GLA (m2) MAJOR TENANTS Wonderpark Pretoria Regional 90 916 Pick n Pay (12 867m²), Game (5 292m²), Checkers (4 709m²), Shopping Centre North Shopping centre Woolworths (4 642
Slide 93: Enyuka
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 94 ENYUKA DEC 16 DEC 17 DEC 18 Number of properties 15 21 22 GLA of properties 80 037m2 106 697m2 120 556m2 Property portfolio value R584m R901m R1 097m Average value per m² R7 305 R8 428 R9 249 Average value per property R39m R43m R
Slide 94: US buyers and sellers
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 95 WHO IS BUYING AND SELLING WHAT IN THE US US BUYERS AND SELLERS: NET ACQUISITIONS, BY SOURCE AND PROPERTY SECTOR, 1 JULY 2017 TO 30 JUNE 2018
Slide 95: US portfolio
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 96 US PORTFOLIO PROPERTY Belden Park 32 East Moore Plaza Stony Creek Woodlands Truman’s Total Crossing Square Marketplace North Canton, Cincinnati, Corpus Christi, Noblesville, Tampa, Grandview, LOCATION Ohio Ohio Texas Indiana Flori
Slide 96: US portfolio
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 97 US PORTFOLIO PROPERTY Belden Park 32 East Moore Plaza Stony Creek Woodlands Truman’s Total Crossing Square Marketplace ACQUISITION DATE 17 Oct 17 19 Jan 18 18 Jan 18 28 Mar 18 26 Oct 18 24 Dec 18 PURCHASE PRICE (USD) 67 000 000 29
Slide 97: US portfolio – leasing
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 98 US PORTFOLIO – LEASING AVG. AVG NEW AVG INCREASE/ AREA EXPIRY RENTAL LEASE RENTAL DURATION DECREASE NO. (ft2) (USD/ft2 p.a) (USD/ft2 p.a) (Years) (%) Reversions Renewals 5 19 983 24.82 24.48 5.09 -1.4 New leases* 2 4 343 30.91 34.
Slide 98: US portfolio – leasing expiry profile by GLA
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 99 US PORTFOLIO – LEASING EXPIRY PROFILE BY GLA 70% Hundreds 64.2 60% 50% 40% 30% 21.1 20% 10.1 10% 3.4 0.0 0.0 1.2 0% VACANCY VACATED EXPIRIES YEAR 1 YEAR 2 YEAR 3 YEAR 4+ (31/12/18) (31/12/18) ROLLED OVER (2H19) (FY20) (FY21) (FY22
Slide 99: Forward-looking statements
EMIRA PROPERTY FUND RESULTS FOR THE SIX MONTHS TO 31 DECEMBER 2018 100 FORWARD-LOOKING STATEMENTS This results presentation contains certain forward-looking statements relating to the financial performance and position of the Group. All forward-looking statements are solely based on the views and co