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Patrizia — PATRIZIA Immobilien — Q2 2013 Earnings Presentation

59 slides from Patrizia's earnings presentation, September 2013

  1. Slide 1: PATRIZIA Immobilien AG

    PATRIZIA Immobilien AG The fully integrated real estate investment company Business Model, Financials and Market September 2013 PATRIZIA Immobilien AG PATRIZIA Bürohaus | Fuggerstraße 26 | 86150 Augsburg | T +49 821 50910-000 | F +49 821 50910-999 | immobilien@patrizia.ag | www.patrizia.ag

  2. Slide 2: Agenda

    Agenda  BUSINESS MODEL  Outlook 2013 and beyond  Business Development Q2/H1 2013  PATRIZIA Share APPENDIX  German Residential and Commercial Market  Sustainability  Financial Calendar and Contact Details PATRIZIA Immobilien AG| © 2013 2

  3. Slide 3: PATRIZIA − Owner-led and independent of banks since 1984

    PATRIZIA − Owner-led and independent of banks since 1984 THE FULLY INTEGRATED REAL ESTATE INVESTMENT COMPANY  Founded in 1984 by Wolfgang Egger, CEO and majority shareholder (51.62%)  PATRIZIA is a real estate investment house, i.e. a real estate investor and full service provider  Offering direc

  4. Slide 4: The PATRIZIA Real Estate Value Chain

    The PATRIZIA Real Estate Value Chain – Covering the Whole Life-Cycle of Real Estate Re-Investment Research & Options Analysis Realisation/ Identification of Cash Inflow Investment Targets and Potentials Sales Management (Residential Property Due Resale, Block Sale) Diligence & Acquisition Management

  5. Slide 5: PATRIZIA – New structure in accordance with AIFMD

    PATRIZIA – New structure in accordance with AIFMD PATRIZIA PATRIZIA PATRIZIA PATRIZIA PATRIZIA GERMANY FRANCE LUXEMBOURG NORDICS UK INVEST- Own Investment1 Co-Investments2 Co-Investments2 Co-Investments2 Co-Investments2 MENTS       Co-Investments2  Investment  Investment  Investment  Inves

  6. Slide 6: PATRIZIA – Organisational growth

    PATRIZIA – Organisational growth PATRIZIA PURSUES THREE DIFFERENT MODELS FOR ORGANISATIONAL GROWTH DISTINGUISHED INDIVIDUAL EXPERIENCED TEAM INCOME PRODUCING ENTITY PATRIZIA builds up a country PATRIZIA signs an experienced PATRIZIA acquires, integrates and organisation from scratch around a Team sp

  7. Slide 7: PATRIZIA Strategy

    PATRIZIA Strategy PATRIZIA – THE LEADING FULLY INTEGRATED REAL ESTATE INVESTMENT COMPANY IN EUROPE REAL ESTATE LEADING FULLY INTEGRATED INVESTMENT COMPANY EUROPE  PATRIZIA is the  Covering the complete  Investment for third  Focus on European preferred contact for real estate value chain parties

  8. Slide 8: Own Portfolio Germany

    Own Portfolio Germany SALE OF PATRIZIA‘S OWN PORTFOLIO1 UNTIL YEAR-END 2015  Sale of approx. 1,800 units per year  Sale of 442 units in H1 2013 (384 individual sales, 58 en bloc)  Stable to increasing sales prices in residential property resale (EUR 2,626/sqm) and block sales (EUR1,931/sqm)  Ave

  9. Slide 9: Overview Co-Investments

    Overview Co-Investments CONTINUE THE EVOLUTION OF PATRIZIA TO A EUROPEAN MULTI-SECTOR INVESTMENT AND ASSET MANAGER GERMANY RESIDENTIAL  WohnModul I  Süddeutsche Wohnen GmbH „Südewo“  GBW AG COMMERCIAL  PATRoffice Real Estate GmbH & Co. KG  DEIKON 1 UK COMMERCIAL  Plymouth Sound LP  Winnersh H

  10. Slide 10: Co-Investments Germany – WohnModul I

    Co-Investments Germany – WohnModul I Business Base: Acquire – Add value – Sell; PATRIZIA is doing the entire management RESIDENTIAL / REAL ESTATE DEVELOPMENTS WOHNMODUL I SICAV-FIS (balanced as participation)  Actively managed co-investment with a German pension fund  The co-investment covers PATR

  11. Slide 11: The Strategy of Co-Investments

    The Strategy of Co-Investments SIGNIFICANT INCREASE OF INVESTMENT VOLUME  In addition to funds in which PATRIZIA has no equity stake of its own, we intend offering a larger number of co-investments that will increasingly replace our own 100% investments  Our own stake depends on the investment and

  12. Slide 12: Income Structure – Service Business

    Income Structure – Service Business INCREASING ASSETS UNDER MANAGEMENT WILL GENERATE A HIGHER PROPORTION OF INCOME AND INCREASE EARNINGS VISIBILITY Management services generated revenues of EUR 36.8mn in H1, thereof EUR17.7mn out of co-investments and EUR 19.1mn* from third party business 2012: EUR

  13. Slide 13: Co-Investments Germany – Residential (I)

    Co-Investments Germany – Residential (I) Business Base: Buy to long-term hold SÜDDEUTSCHE WOHNEN GMBH FORMERLY LBBW IMMOBILIEN GMBH Closing in March 2012  Gross purchase price: EUR 1.435bn  PATRIZIA’s equity stake in the co-investment: EUR15mn (2.5% of equity), 12 partners  21,000 residential uni

  14. Slide 14: Co-Investments Germany – Residential (II)

    Co-Investments Germany – Residential (II) Business Base: Buy to long-term hold GBW AG PATRIZIA WINS BID FOR BAYERNLB’ SHARES IN GBW Closing in May 2013  Acquisition of 96.52% of all shares on day one  Thereof 91.93% from BayernLB, 1.62% from DKB and 2.97% from a private investor  Gross purchase p

  15. Slide 15: Co-Investments Germany – Commercial (I)

    Co-Investments Germany – Commercial (I) Business Base: Acquire – Add value – Sell; PATRIZIA is doing the entire management PATROFFICE FIRST PATRIZIA CO-INVESTMENT  Founded in 2007, planed duration 7 years  Investment in German real estate, mixed use properties with commercial focus  Co-investors

  16. Slide 16: Co-Investments Germany – Commercial (II)

    Co-Investments Germany – Commercial (II) Business Base: Buy to long-term hold DEIKON ACQUISITION OF A PORTFOLIO OF 86 GERMAN RETAIL PROPERTIES Closing expected in Nov. 2013  PATRIZIA itself is aiming for an equity participation in the final co-investment-structure  Gross purchase price of EUR 178m

  17. Slide 17: PATRIZIA UK

    PATRIZIA UK ACQUISITION OF UK BASED TAMAR CAPITAL GROUP LTD (‘TAMAR’) TAMAR – FULLY CONSOLIDATED SINCE APRIL 2013  Real estate investment and asset management company (established in 2009, management buy-out in 2011)  The international team covers: investment management, asset management, deal sou

  18. Slide 18: Third Party Business – German Spezialfonds

    Third Party Business – German “Spezialfonds” Business Base: Buy to long-term hold, no PATRIZIA equity stake in it TWO ASSET MANAGEMENT COMPANIES OFFER SPECIAL FUNDS RESIDENTIAL: PATRIZIA WOHNINVEST KAG, AUGSBURG  Founded and built up in 2007 COMMERCIAL: PATRIZIA GEWERBEINVEST KAG, HAMBURG  Acquire

  19. Slide 19: Asset Allocation of Funds and Co-Investments

    Asset Allocation of Funds and Co-Investments Sectors Geographical Footprint of Assets* 2.4% 2.2% 1.8% 2.0% 2.9% 11.7% 5.7% 78.8% 4.1% 2.8% 18.3% 59.6% 1.9% 1.8% 1.5% 1.4% 0.9% 0.3% 0.4% 0.1% 0.3% Residential Light Industrial Germany Sweden Belgium Hungary Office Health / Care France Netherlands Irel

  20. Slide 20: PATRIZIA’s Group Equity

    PATRIZIA’s Group Equity ASSETS UNDER TIED INVESTMENT SHARE IN MANAGEMENT CAPITAL INVESTMENT AS OF 30 JUNE 2013 IN EUR MN IN EUR MN IN % OWN PORTFOLIO 5,510 330.6 94.9 - 100 Investment property (fair value) and inventories (at cost)1 661 196.7 100 Operating PATRIZIA companies2 299 12.0 100 PATRIZIA G

  21. Slide 21: Agenda

    Agenda  Business Model  OUTLOOK 2013 AND BEYOND  Business Development Q2/H1 2013  PATRIZIA Share APPENDIX  German Residential and Commercial Market  Sustainability  Financial Calendar and Contact Details PATRIZIA Immobilien AG| © 2013 21

  22. Slide 22: Outlook 2013 and beyond

    Outlook 2013 and beyond ASSETS UNDER MANAGEMENT  Increase by at least EUR 1bn p. a.  Own investments  sale of approx. 1,800 units p. a.  sell off the entire stock of own property as far as possible by the end of 2015  Co-investments  PATRIZIA’s own stake up to10%, depending on investment and p

  23. Slide 23: Agenda

    Agenda  Business Model  Outlook 2013 and beyond  BUSINESS DEVELOPMENT Q2/H1 2013  PATRIZIA Share APPENDIX  German Residential and Commercial Market  Sustainability  Financial Calendar and Contact Details PATRIZIA Immobilien AG| © 2013 23

  24. Slide 24: Growth of PATRIZIA since 2007

    Growth of PATRIZIA since 2007 DEVELOPMENT ASSETS UNDER MANAGEMENT1, 2 (IN EUR BILLION) / EMPLOYEES  Due to the GBW transaction the target of EUR 10bn AuM by the end of 2015 has already been reached in Q2 2013  Further increase by at least EUR 1bn p. a.  Increase in AuM from 2007 to H1 2013: 364%

  25. Slide 25: Key Performance Indicators

    Key Performance Indicators  Operating result H1 2013: EUR 18.1mn  Equity Ratio 30.06.2013: 36.5%  Gross sales margin H1 2013: 14% investment property, 24% inventories Operating result Equity ratio Gross sales margins 50 40% 40% 36.5% 43.9 35.4% 40 30% 28.1% 30% 24.3% 23.9% 30 28.8 22.3% 20.0% 19.

  26. Slide 26: Development of the Operating Result

    Development of the Operating Result OPERATING RESULT 45 47-49 35 43.9 25 28.8 15 18.1 4.0 2.7 5 12.4 -5 -12.4 -15 2007 2008 2009 2010 2011 2012 H1 2013 2013e INVESTMENTS MANAGEMENT SERVICES 100% 100% Target 2013 - 2015 80% 80% 80% 80% 60% Target 60% 67% 67% 2013 - 2015 40% 49% 40% 51% 20% 33% 33% 20

  27. Slide 27: Development of the Operating Result by Half-Year

    Development of the Operating Result by Half-Year H2 HAS ALWAYS DELIVERED THE STRONGEST IMPACT ON THE GROUP‘S RESULT 2007 2008 2009 2010 2011 2012 2013e EUR -12.4mn EUR 4.0mn EUR 2.7mn EUR 12.4mn EUR 28.8mn EUR 43.9mn EUR 47-49mn -21% -79% >-100% >100% >-100% >100% 50% 50% 6% 94% 31% 69% ca. 38% ca.

  28. Slide 28: Reconciliation of the Operating Result

    Reconciliation of the Operating Result IMPROVED OPERATING RESULT  First tranche of the acquisition fee for the GBW transaction in Q2/2013  Asset Management fee for Südewo and GBW in Q2/2013 EUR‘000 Q2 2013 Q2 2012 H1 2013 H1 2012 FY 2012 EBIT 5,326 5,379 7,835 18,157 44,739 Amortisation of intangi

  29. Slide 29: Development of Revenues from H1 2012 to H1 2013

    Development of Revenues from H1 2012 to H1 2013 150 +10% 140 58.7 148.5 130 134.4 31.1 120 110 100 103.4 -11.4 90 5.8 -1.1 -2.8 89.8 80 -5.8 1.7 70 60 50 40 30 20 10 0 Total Purchase Total Purchase Purchase Rental Revenues Revenues Other Total Purchase Total receipts price revenues price Price reven

  30. Slide 30: Split of Revenues – H1 2013

    Split of Revenues – H1 2013  Purchase price revenues from investment property exceed once again those of inventories (EUR 58.7mn vs. EUR 30.6mn) 150  130 Revenues from management services improved by 26% to EUR 36.8mn (H1 2012: 29.3mn)  Co-Investments: H1 2013 EUR 17.7mn (+10.5%) 58.7 110  Reven

  31. Slide 31: Staff Costs

    Staff Costs DEVELOPMENT OF STAFF COSTS  Significant increase by 37.8% to EUR 29.7mn (H1/2012: EUR 21.6mn)  Higher staff numbers affected the entire six months  30 June 2013 / 2012 in comparison: staff: 636 vs. 536 (+19%), FTE: 585 vs. 512 (+14%)  Higher provisions for long-term variable compensa

  32. Slide 32: Income from Participations

    Income from Participations  The co-investment business is accounted in the P&L in the items “income from participations” / “earnings from companies accounted for using the equity method”  But the acquisition fee is accounted in the P&L in the “revenues” item  Q2 2013: income from participations E

  33. Slide 33: Key Financial Figures

    Key Financial Figures REVENUES AND EARNINGS (EUR‘000) Q2 2013 Q2 2012 H1 2013 H1 2012 FY 2012 Total revenues 47,660 43,639 89,761 103,374 229,238 Total operating performance 50,730 40,472 89,791 88,722 196,111 EBT 11,557 4,680 17,787 9,027 28,621 Operating result1 10,487 5,783 18,139 13,520 43,892 N

  34. Slide 34: Further Improvement of the Financial Situation

    Further Improvement of the Financial Situation BANK LOANS VS. EQUITY RATIO  Bank loans has been reduced by 16% since year-end 2012  Reduce bank liabilities and the two bonded loans (EUR 77mn) to EUR 350mn till 31 Dec 2013 100% 1,200 1,262 90% 1,162 1,000 1,070 80% 70% 800 841 Target 2013 60% 51.2%

  35. Slide 35: Net Asset Value

    Net Asset Value NAV / INVESTMENTS SEGMENT REPRESENTS 28% OF THE OPERATING RESULT FOR H1  Investment property and inventories were sold in H1 2013 at a profit with a gross margin of 13.7% and 23.9% respectively, thus confirming the value retention of the properties  The whole service business that

  36. Slide 36: Own Portfolio – Single Unit and Block Sales

    Own Portfolio – Single Unit and Block Sales RELEVANT START OF SALES IN 2008 442 UNITS SOLD IN H1 2013 OUT OF THE OWN PORTFOLIO units 2,000 1,803 1,842 1,800 1,709 1,002 1,097 1,600 785 7 1,400 1,198 1,200 722 1,000 946 289 924 800 801 745 442 600 487 657 58 400 487 476 384 200 0 2007 2008 2009 2010

  37. Slide 37: Co-Investments and Third Parties – Single Unit and Block Sales

    Co-Investments and Third Parties – Single Unit and Block Sales RELEVANT START OF SALES IN 2011 665 UNITS SOLD IN H1 2013 OUT OF CO-INVESTMENTS AND FOR THIRD PARTIES units 987 1,000 900 800 408 7 700 665 600 509 181 77 500 20 400 171 300 406 2 482 200 311 100 20 42 0 41 2007 -2010 2011 2012 H1 2013 S

  38. Slide 38: Agenda

    Agenda  Business Model  Outlook 2013 and beyond  Business Development Q2/H1 2013  PATRIZIA SHARE APPENDIX  German Residential and Commercial Market  Sustainability  Financial Calendar and Contact Details PATRIZIA Immobilien AG| © 2013 38

  39. Slide 39: PATRIZIA Share

    PATRIZIA Share PATRIZIA SHARE AT A GLANCE SHARE PRICE DEVELOPMENT 2013: +4% ISIN DE000PAT1AG3 10.0 € SIN (Security Identification Number) PAT1AG 9.5 € Code P1Z 9.0 € No. of shares in issue 57,343,000 8.5 € H1 2013 high*/ low* EUR 9.75 / EUR 6.05 8.0 € Closing price at 30 June 2013* EUR 7.72 7.5 € Sh

  40. Slide 40: Market Cap of PATRIZIA since April 2006

    Market Cap of PATRIZIA since April 2006 DEVELOPMENT OF THE PATRIZIA MARKET CAP  Increase in market cap from January 2012 to July 2013 by 163% 1,400 31.12.2006: EUR 1,176mn 1,200 1,000 800 30.08.2013: EUR 424mn 600 400 200 28.11.2008: EUR 50mn 0 2006 2007 2008 2009 2010 2011 2012 2013 PATRIZIA Immob

  41. Slide 41: Ranking: Market Cap and Turnover since 2006

    Ranking: Market Cap and Turnover since 2006 POSITIVE DEVELOPMENT OF THE PATRIZIA MARKET CAP AND THE TURNOVER Rank market cap July 2013: 74 Rank turnover July 2013: 68 2006 2007 2008 2009 2010 2011 2012 2013 40 50 60 70 80 90 100 110 120 Rank Market Cap Rank Turnover PATRIZIA Immobilien AG| © 2013 41

  42. Slide 42: Share Price Development of PATRIZIA

    Share Price Development of PATRIZIA SHARE PRICE DEVELOPMENT OF PATRIZIA LAST 12 MONTHS: +50% 10 € 9€ 8€ 7€ 6€ 5€ 4€ SHARE PRICE PATRIZIA IMMOBILIEN AG – SINCE IPO 25 € 20 € Suprime Crisis 15 € 10 € 5€ 0€ PATRIZIA Immobilien AG| © 2013 42

  43. Slide 43: Reasons to invest in PATRIZIA

    Reasons to invest in PATRIZIA PATRIZIA IMMOBILIEN AG  Integrated full-service investment house focused on private and institutional real estate investors  Local presence combined with a European market experience  Network built over 30 years providing off-market access to property  Leading fund

  44. Slide 44: Agenda

    Agenda  Business Model  Outlook 2013 and beyond  Business Development Q2/H1 2013  PATRIZIA Share APPENDIX  GERMAN RESIDENTIAL AND COMMERCIAL MARKET  Sustainability  Financial Calendar and Contact Details PATRIZIA Immobilien AG| © 2013 44

  45. Slide 45: Investment Prospects of Regional Residential Markets in Germany

    Investment Prospects of Regional Residential Markets in Germany Regional analysis in Germany necessary An analysis of the opportunities and risks of residential investments needs to be carried out at local level and to include both supply and demand factors. On the supply side above all the provisio

  46. Slide 46: Regional Population Growth until 2030 – By Districts

    Regional Population Growth until 2030 – By Districts EXPECTED CHANGE FROM 2009 TO 2013 IN PERCENT below -15% -15% to below -10% -10% to below -5% -5% to below 0% 0% to below 5% 5% and more Source: Handelsblatt 2013-05-13, Bundesinstitut für Bau-, Stadt- und Raumforschung, BiB, Statistisches Bundesam

  47. Slide 47: Vacancy Rates – Cities and Districts

    Vacancy Rates – Cities and Districts Eastern Germany suffers from higher vacancy VACANCY IN MULTY-FAMILY HOME below 2% 2% to below 4% 4% to below 6% 6% to below 8% 8% and more Source: Immobilien Zeitung, empirica PATRIZIA Immobilien AG| © 2013 47

  48. Slide 48: Rural Exodus continues − Benefit Cities

    Rural Exodus continues − Benefit Cities GROWING AND SHRINKING CONGREGATIONS IN GERMANY Communities strong growth growth shrinking strong shrinking Evaluated data base: Population development 2005 - 2010 Net migration 2008 - 2010 Workplace Development 2005 - 2010 Unemployment rate 2009/2010 Real powe

  49. Slide 49: DAX and MDAX Companies with their Headquarters

    DAX and MDAX Companies with their Headquarters DAX MDAX Source: PATRIZIA Research, as of 7 May 2013 PATRIZIA Immobilien AG| © 2013 49

  50. Slide 50: SDAX and TecDAX Companies with their Headquarters

    SDAX and TecDAX Companies with their Headquarters SDAX TecDAX Source: PATRIZIA Research, as of 7 May 2013 PATRIZIA Immobilien AG| © 2013 50

  51. Slide 51: European House Prices: Two Faces with many Facets

    European House Prices: Two Faces with many Facets 190 190 170 170 150 150 130 130 110 110 90 90 70 70 Q1 2003 Q1 2005 Q1 2007 Q1 2009 Q1 2011 Q1 2003 Q1 2005 Q1 2007 Q1 2009 Q1 2011 FI BE FR NO SE DK ES UK IE Eurozone DE CH AT PT Source: PATRIZIA Research, EZB, Lloyds Banking Group, SCB, SSB PATRIZI

  52. Slide 52: Rents and Inflation: No general Outperformance

    Rents and Inflation: No general Outperformance Rent (Top 7) vs. Inflation Re-letting in the stock New Construction − first use (Index 1991 = 100) (Index 1980 = 100) (Index 1980 = 100) 150 275 14.00% 275 14.00% 250 12.00% 250 12.00% 140 225 10.00% 225 10.00% 200 8.00% 200 8.00% 130 175 6.00% 175 6.00

  53. Slide 53: German Investment Market – Residential with increasing Importance

    German Investment Market – Residential with increasing Importance EUR 80 bn 100% 90% EUR 70 bn 80% EUR 60 bn 70% EUR 50 bn 60% 59 EUR 40 bn 50% 24 49 40% EUR 30 bn 26 30% EUR 20 bn 21 24 20% 25 20 EUR 10 bn 11 10% 13 15 11 7 6 4 4 0% EUR bn 2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008

  54. Slide 54: Mietspiegel (Rent Index)

    Mietspiegel (Rent Index) THE MOST COMMON BENCHMARK FOR EXISTING RENTS IS A CITY-SPECIFIC MIETSPIEGEL The “Mietspiegel” is an index of local residential markets rents published by each major municipality in Germany every two years. The rent index contains “average” rents for apartments for each sub-m

  55. Slide 55: Agenda

    Agenda  Business Model  Outlook 2013 and beyond  Business Development Q2/H1 2013  PATRIZIA Share APPENDIX  German Residential and Commercial Market  SUSTAINABILITY  Financial Calendar and Contact Details PATRIZIA Immobilien AG| © 2013 55

  56. Slide 56: Sustainability has always been a Focus for PATRIZIA

    Sustainability has always been a Focus for PATRIZIA PATRIZIA PROJECT DEVELOPMENT HIGHLIGHTS “FEUERBACHSTRASSE“ IN FRANKFURT/MAIN The construction of six city villas and one apartment block has earned the pre-certificate in gold, the highest distinction awarded by the German Sustainable Building Coun

  57. Slide 57: Agenda

    Agenda  Business Model  Outlook 2013 and beyond  Business Development Q2/H1 2013  PATRIZIA Share APPENDIX  German Residential and Commercial Market  Sustainability  FINANCIAL CALENDAR AND CONTACT DETAILS PATRIZIA Immobilien AG| © 2013 57

  58. Slide 58: Financial Calendar, Conferences and Roadshows

    Financial Calendar, Conferences and Roadshows September 5–6  EPRA, Paris 16  UBS Best of Germany Conference, New York 17 – 19  Roadshow with Berenberg Bank in New York, Boston, Chicago 23  German Corporate Conference, Goldman Sachs International and Berenberg Bank, Munich 24  UniCredit German I

  59. Slide 59: Contact Details

    Contact Details ARWED FISCHER MARGIT MILLER VERENA SCHOPP DE CFO HEAD OF IR ALVARENGA MANAGER IR PATRIZIA Immobilien AG PATRIZIA Immobilien AG PATRIZIA Immobilien AG PATRIZIA Bürohaus PATRIZIA Bürohaus PATRIZIA Bürohaus Fuggerstrasse 26 Fuggerstrasse 26 Fuggerstrasse 26 86150 Augsburg 86150 Augsburg

PATRIZIA Immobilien — Q2 2013 Earnings Presentation on 6ix