Manulife Us Reit · SGX:BTOU
Manulife Us Reit — Merger or Acquisition (September 2019)
20 slides from Manulife Us Reit's merger presentation, Sep 19, 2019
Slide 1: Acquisition of 400 Capitol, Sacramento, California
Acquisition of 400 Capitol Sacramento, California 19 September 2019
Slide 2: Important Notice
Important Notice This presentation shall be read in conjunction with Manulife US REIT’s announcement dated 19 September 2019 published on SGXNet. This presentation is for information purposes only and does not constitute or form part of an offer, invitation or solicitation of any offer to purchase o
Slide 3: Contents
Contents 1 Overview of 400 Capitol 2 Rationale and Key Benefits of the Acquisition 3 Conclusion 4 Appendix 3
Slide 4: Overview of 400 Capitol, Sacramento, California
Overview of 400 Capitol, Sacramento, California 29-storey top Class A office building, Description located in Sacramento’s CBD Top Tallest in Sacramento, instantly recognisable Class A office tower with best- in-class features Location 400 Capitol Mall, Sacramento, California Asset Land Tenure Freeh
Slide 5: Rationale and Key Benefits of the Acquisition
PROXIMITY TO THE CALIFORNIA STATE “THE KAY” NEARBY EAST SAC AND CAPITOL LAND PARK NEIGHBORHOODS 400 Capitol GOLDEN 1 CENTER DOWNTOWN COMMONS CLOSE BY THE R STREET CORRIDOR OLD SACRAMENTO PROMINENT LOCATION ON CAPITOL MALL Rationale and Key Benefits of the Acquisition
Slide 6: Rationale and Key Benefits of the Acquisition
Rationale and Key Benefits of the Acquisition 1 Entry into California’s Capital – Flourishing Economy and Thriving Office Market Prime Location, Top Class A Tower, 5-Star Amenities Attracting Multiple High-Quality 2 Tenants 3 Improve Tenant and Net Property Income Diversification 4 Accretive Acquisi
Slide 7: Sacramento: Capital of World's 5th Largest Economy, California
1 Sacramento: Capital of World’s 5th Largest Economy1, California Flourishing Economy and Live Work Play Environment Located in the Heart of California • One of the strongest economies in California – average Gross Metropolitan Product annual growth rate of 3.2% (2013 – 2018), exceeding U.S. average
Slide 8: >US$2.0 b Investment Rejuvenating Sacramento
1 >US$2.0 b Investment Rejuvenating Sacramento Healthcare Hub, Residential, Hospitality and Retail Projects Driving Economy and Office Market Sports and entertainment venue 1.5 m sq ft of office, residential, retail and hotel 1 US$47 m committed by Sacramento’s City Council to improve access to
Slide 9: Thriving Office Market – High Barriers to Entry
1 Thriving Office Market – High Barriers to Entry • Limited CBD supply with high Class A replacement cost of ~ US$700 per sq ft • Competitive micro market has average vacancy of 6.3%1 vs Class A average vacancy of 11.3%2 • Strong growth in economy leading to office demand and robust rent growth Hist
Slide 10: Top Class A Tower with 5-Star Amenities and Spectacular Views
Top Class A Tower with 5-Star Amenities and Spectacular 2 Views Distinctive Design 5-star Onsite Amenity Base Designed by the renowned architectural firm Hellmuth, Fitness center, heated lap pool, conference rooms, Obata & Kassabaum and recently renovated lobby abundant parking, fine dining, gourmet
Slide 11: Strong Occupancy and Long WALE with Upside Potential
2 Strong Occupancy and Long WALE with Upside Potential • Occupancy of 94.9%1 with average 2.3% rental escalations p.a. Retention rate of > 80.0% for expiring leases for last 3 years • Average in-place rent is up to 11.5% below potential asking rental rate of the property Long WALE by NLA of 5.9 Ye
Slide 12: Top 10 Tenants by GRI has Long WALE of 6.4 Years
2 Top 10 Tenants by GRI has Long WALE of 6.41 Years Top 10 Tenants (% of GRI) Tenant Sector NLA (sq ft) % of GRI Wells Fargo2 Finance and Insurance 52,618 10.3 WeWork Real Estate 47,316 10.0 Weintraub Genshlea & Chediak Legal 44,900 9.1 Kronick Moskovitz Legal 30,659 8.5 Orrick Herrington & Sutcliff
Slide 13: Tenant and Net Property Income Diversification
3 Tenant and Net Property Income Diversification Current Portfolio: Trade Sector by GRI Enlarged Portfolio: Trade Sector by GRI Architectural and Administrative and Accounting, 1.8% Manufacturing,Administrative and Engineering, 1.9% Manufacturing, Support Services, 1.0% Architectural and 1.6% Suppor
Slide 14: Accretive Acquisition Enhances Unitholders' Returns
4 Accretive Acquisition Enhances Unitholders’ Returns Purchase Price 0.9% below Appraised Value DPU Accretion of 2.3% 200.5 2 3.11 US Cents US$ m 198.8 3.04 Valuation 1 Purchase Price 1H 2019 1H 2019 (Pre-Acquisition) (Post-Acquisition) Gearing Reduced by 0.5% NAV per Unit Accretion of 0.6% 37.1 0.8
Slide 15: Possible Entry into FTSE EPRA Nareit Index at Next Review
5 Possible Entry into FTSE EPRA Nareit Index at Next Review • Possible entry into FTSE EPRA Nareit Developed Asia Index • May result in positive re-rating of Manulife US REIT upon index inclusion Pro-forma Market Capitalisation Total Market Cap: Total Market Cap: US$1.422 b US$1.271 b EPRA NAREIT Fr
Slide 16: Conclusion
Conclusion
Slide 17: Accretive Acquisition Fortifies Portfolio
Accretive Acquisition Fortifies Portfolio 1 Entry into California’s Capital – Flourishing Economy and Thriving Office Market Prime Location, Top Class A Tower, 5-Star Amenities Attracting Multiple High-Quality 2 Tenants 3 Improve Tenant and Net Property Income Diversification 4 Accretive Acquisition
Slide 18: Appendix
Appendix
Slide 19: Appendix: Portfolio Overview
Appendix: Portfolio Overview Figueroa Michelson Peachtree Plaza Exchange Penn Phipps Centerpointe Capitol2 Washington, Location Los Angeles Irvine Atlanta Secaucus Jersey City Atlanta Virginia Sacramento D.C. Property Type Class A Trophy Class A Class A Class A Class A Trophy Class A Class A Complet
Slide 20: Napa Valley, California
Napa Valley, California For enquiries, please contact: Ms Caroline Fong, Head of Investor Relations Direct: (65) 6801 1066 Email: carol_fong@manulifeusreit.sg Manulife US Real Estate Management Pte. Ltd. (Company registration no. 201503253R) 8 Cross Street, #16-03 Manulife Tower, Singapore 048424 ht
Manulife US REIT — Merger or Acquisition (September 2019) on 6ix